Indus Towers Ltd.-இன் இயக்குநர் அறிக்கை
Mar 31, 2023
Your Directors are pleased to present the Seventeenth Boardâs Report on the business and operations of Indus Towers Limited (âthe Companyâ) together with the audited Financial Statements for the Financial Year ended March 31,2023.
Indus Towers is a provider of tower and related infrastructure sharing services. We are one of the largest telecom tower companies in India basis the number of towers and colocations operated by the Company. The business of Indus Towers is to deploy, own, operate and manage passive infrastructure pertaining to telecommunication operations. The Company provides access to its towers, primarily to wireless telecommunication service providers, on a shared basis under long-term contracts. Your Company has a nationwide presence with operations in all 22 telecommunication circles in India and caters to all wireless telecommunication service providers in India.
As of March 31, 2023, Indus Towers owned and operated 192,874 towers with 342,831 co-locations in 22 telecommunication circles.
The Financial Statements of the Company have been prepared in accordance with the Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (âthe Actâ) read with Companies (Accounts) Rules, 2014.
A. Consolidated financial results as per Ind AS
|
? Millions |
||
|
Year ended |
Year ended |
|
|
Particulars |
March 31, |
March 31, |
|
2023 |
2022 |
|
|
Revenue* |
283,818 |
277,172 |
|
EBIDTA* |
97,670 |
149,429 |
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Profit Before Tax |
27,593 |
84,307 |
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Profit After Tax |
20,400 |
63,731 |
|
B. |
Standalone financial results as per Ind AS |
? Millions |
|
|
Year ended |
Year ended |
||
|
Particulars |
March 31, |
March 31, |
|
|
2023 |
2022 |
||
|
Revenue* |
283,818 |
277,082 |
|
|
EBIDTA'' |
97,674 |
149,305 |
|
|
Profit Before Tax |
27,620 |
84,243 |
|
|
Profit After Tax |
20,433 |
63,671 |
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|
*excluding other income |
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During the Financial Year 2022-23, there is no change in the Authorized Share Capital of the Company, and it stood at H 35,500,000,000/- divided into 3,550,000,000 equity shares of h 10/- (h Ten) each.
During the Financial Year 2022-23, there is no change in the Companyâs issued, subscribed, and paid-up equity share capital.
As on March 31, 2023, the issued, subscribed and paid-up equity share capital of the Company stood at H 26,949,369,500/-divided into 2,694,936,950 Equity Shares of H 10/- (h Ten) each fully paid-up.
Fund raised during the Financial Year
Issuance of rated, listed, unsecured, redeemable NonConvertible Debentures (âNCDsâ) by way of Private Placement
During the Financial Year 2022-23, the Company has raised, by way of Private Placement, total 15,000 NCDs of face value of H 10 Lakh each amounting to H 1,500 Crore in three series which were allotted on December 07, 2022 as details below:
⢠Series I Debentures: 7,500 NCDs amounting to H 750 Crore, maturing on December 07, 2024
⢠Series II Debentures: 3,750 NCDs amounting to H 375 Crore, maturing on June 07, 2025
⢠Series III Debentures: 3,750 NCDs amounting to H 375 Crore, maturing on December 07, 2025
These NCDs are listed on National Stock Exchange of India Limited (NSE).
The Company has not transferred any amount to the General Reserve for the Financial Year ended March 31, 2023.
The Board of Directors of the Company has not declared any dividend for the Financial Year 2022-23.
As per Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âthe Listing Regulationsâ), the top 1000 listed companies based on the market capitalization shall formulate a dividend distribution policy. Accordingly, the Dividend Distribution Policy was adopted by the Board of Directors of the Company to set out the parameters and circumstances that will be taken into account by the Board in determining the distribution of dividend to its shareholders and / or retaining profits earned by the Company. The dividend distribution policy is available on the Companyâs website at https://www.industowers.com/wp-content/themes/ indus/pdf/policv/Dividend-Policv.pdf.
As on the date of this report, CRISIL Limited rated their LongTerm Rating to CRISIL AA / Stable, Short-term rating to CRISIL A1 (Reaffirmed) and Bond rating to CRISIL AA / Stable. It also reaffirmed the Commercial Papers Rating to CRISIL A1 assigned to the Company. Further, ICRA Limited rated the NonConvertible Debentures rating to [ICRA] AA (Stable), Term Loans rating to [ICRA] AA (Stable), Fund based/ Non-fund based rating to [ICRA] AA (Stable) and rating of unallocated limits to [ICRA] AA (Stable)/ A1 . It also reaffirmed the Commercial Papers Rating to [ICRA] A1 and issuer rating to [ICRA] AA (Stable) assigned to the Company.
Transfer of amount to Investor Education and Protection Fund
Pursuant to the provisions of Section 124 of Companies Act, 2013 read with Rules made thereunder during the Financial Year 2022-23, the Company has transferred an
amount of H 136,721/- (Rupees One Lakh Thirty Six Thousand Seven Hundred and Twenty One Only) pertaining to final dividend on equity shares for Financial Year 2014-15, which remained unpaid/ unclaimed for a period of seven years, to Investor Education and Protection Fund (IEPF) established by the Central Government.
Further, 185 equity shares of the Company on which the dividend remained unpaid/ unclaimed for a period of seven consecutive years were also transferred to IEPF in accordance with the Act and Rules thereunder after giving due notice to the concerned shareholders.
The investors whose shares and dividend amount have been transferred to IEPF may claim their shares and seek a refund in accordance with the provisions of law. The details regarding the above along with the process for claiming the unpaid dividend / shares is available on the website of the Company at https:// www.industowers.com/investor/shares/.
The Company has also uploaded the details of unpaid and unclaimed dividend amounts lying with the Company as on the date of closure of previous Financial Year i.e. March 31, 2022 on the website of the Company at https://www.industowers. com/%20investor/shares/?var=1657517893.
In accordance with the provisions of Rule (2A) of Rule 7 of Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, Ms. Samridhi Rodhe, Company Secretary & Compliance Officer of the Company, has been appointed as the Nodal Officer of the Company. The details are available on the Companyâs website at www.industowers.com.
The Company has not accepted any deposit and as such no amount of principal or interest was outstanding as on the date of the Financial Statements.
Directors and Key Managerial Personnel
Induction, Re-appointment and Resignation
During the Financial Year, the following changes took place in the Board:
Appointments and Re-appointments
- Mr. Sunil Sood (DIN: 03132202), was appointed as an Additional Director in the category of a Non-Executive NonIndependent Director w.e.f June 30, 2022. The shareholders
in their meeting held on August 23, 2022, approved the appointment of Mr. Sood as a Director, liable to retire by rotation.
- Ms. Anita Kapur (DIN: 07902012) was re-appointed as an Independent Director for a second term of five years w.e.f. January 17, 2023, till January 16, 2028, with the approval of shareholders in their meeting held on August 23, 2022.
- Mr. Pankaj Tewari (DIN: 08006533) was appointed as an Additional Director in the category of Non-Executive NonIndependent Director of the Company w.e.f. October 8, 2022. Thereafter the shareholders through postal ballot/ e-voting on December 30, 2022, have approved the appointment of Mr. Tewari as a Director, liable to retire by rotation.
- Mr. Prachur Sah (DIN: 07871676) was appointed as an Additional Director designated as Managing Director & Chief Executive Officer (MD & CEO) of the Company w.e.f. January 3, 2023, for a period of five years. Thereafter, the shareholders through postal ballot/e-voting on April 01, 2023, have approved the appointment of Mr. Sah as MD & CEO for a period of 5 years.
- Mr. Ramesh Abhishek (DIN: 07452293) was appointed as an Additional Director in the category of Independent Director for a term of five consecutive years w.e.f. January 3, 2023 till January 2, 2028. Thereafter, the shareholders, through postal ballot/e-voting on April 01,2023, have approved the appointment of Mr. Abhishek as an Independent Director for a period of five years.
- Mr. Harjeet Singh Kohli (DIN: 07575784), Mr. Randeep Singh Sekhon (DIN: 08306391) and Mr. Ravinder Takkar (DIN: 01719511), will retire by rotation at the ensuing AGM and, being eligible, have offered themselves for reappointment. The Board, on the recommendation of the HR, Nomination and Remuneration Committee, recommends their re-appointment as Directors liable to retire by rotation at the ensuing AGM.
In the opinion of the Board, all the directors, including the directors appointed/ re-appointed during the year, possess the requisite qualifications, experience, expertise, proficiency and hold high standards of integrity.
Brief resume, nature of expertise, disclosure of relationships between directors inter-se, details of directorships and Committee membership held in other companies of the Directors proposed to be appointed/ re-appointed, along with their shareholding in the Company, as stipulated under Secretarial Standard- 2 and Regulation 36 of the Listing Regulations, is appended as an Annexure to the Notice of the ensuing AGM.
Resignations
- Mr. Balesh Sharma (DIN: 07783637), Non-Executive NonIndependent Director of the Company resigned from the Board w.e.f. June 30, 2022.
- Mr. Bimal Dayal (DIN: 08927887), resigned from the Board and from the position of Managing Director & CEO of the Company w.e.f. September 17, 2022.
The Board placed on record its deepest gratitude and appreciation towards valuable contribution made by the outgoing Directors.
Save and except the above, there was no change in the Directors or KMPs of the Company during the year under review.
Declaration by Independent Directors
Pursuant to Section 149(7) of the Act, the Company has received declarations from all Independent Directors confirming that they meet the criteria of independence as specified in Section 149(6) of the Act, as amended, read with Rules framed thereunder and Regulation 16(1)(b) of the Listing Regulations. In terms of Regulation 25(8) of the Listing Regulations, the Independent Directors have confirmed that they are not aware of any circumstance or situation which exists or may be reasonably anticipated that could impair or impact their ability to discharge their duties with an objective independent judgement and without any external influence and that they are independent of the Management.
The Independent Directors have also confirmed that they have complied with the Companyâs Code of Conduct and that they are registered on the databank of Independent Directors maintained by the Indian Institute of Corporate Affairs. The Directors have further confirmed that they are not debarred from holding the office of director under any SEBI order or any other such authority.
The Board of Directors of the Company have taken on record the aforesaid declaration and confirmation submitted by the Independent Directors.
Policy on Nomination, Remuneration and Board Diversity
The Company believes that building a diverse and inclusive culture is integral to its success. A diverse Board will be able to leverage different skills, qualifications, professional experiences, perspectives and backgrounds, which is necessary for achieving sustainable and balanced development. The Board has adopted a Policy on Nomination, Remuneration and Board Diversity, on appointment and remuneration of Directors, Key Managerial Personnel & Senior Management.
The Policy, inter-alia, includes criteria, terms and conditions for determining qualifications, competencies and positive attributes for appointment of Directors (executive and non-executive including independent directors), Key Managerial Personnel and persons who may be appointed in Senior Management positions, their remuneration and diversity in the Board etc. The detailed policy is available on the website of the Company at https://www.industowers.com/wp-content/themes/indus/pdf/ SE/2020/Nomination-Policv.pdf.
Annual Board Evaluation and Familiarisation Programme for the Board Members
The Company has adopted a structured induction programme for orientation and training of Directors at the time of their joining. A note on the familiarisation programme is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
The HR, Nomination and Remuneration Committee, has put in place a robust framework for evaluation of the Board, Board Committees and Individual Directors including the Independent Directors, Chairman and MD & CEO. Customized questionnaires were circulated, responses were analysed, and the results were subsequently discussed by the Board. Recommendations arising from the evaluation process were duly considered by the Board to further augment its effectiveness. A detailed update on the Board Evaluation is provided in the report on Corporate Governance which forms part of this Integrated Report.
During the Financial Year 2022-23, the Board of Directors met 9 times i.e. on May 05, 2022; July 27, 2022; August 02, 2022; September 26, 2022; October 08, 2022; October 27, 2022; December 22, 2022; January 24, 2023 and March 24, 2023. The period between any two consecutive meetings of the Board of Directors of the Company was not more than 120 days.
The details regarding composition, number of Board meetings held, and attendance of the Directors during the Financial Year 2022-23 are set out in the Report on Corporate Governance which forms part of this Integrated Report.
The Company has several Board Committees which have been established as part of the best corporate governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes. As on March 31,2023, the Board has 5 Committees, namely, Audit & Risk Management Committee, HR, Nomination and Remuneration Committee,
Corporate Social Responsibility (CSR) Committee, Stakeholdersâ Relationship Committee, Environmental, Social and Governance (ESG) Committee. Additionally, the Board has formed Special Committee of Directors and Committee of Directors for Fund Raising. The details with respect to the composition, powers, roles, terms of reference, number of meetings held etc. of the Committees during the Financial Year 2022-23 and attendance of the members at each Committee meeting is provided in the Report on Corporate Governance which forms part of this Integrated Report.
All the recommendations made by the Committees of the Board including the Audit & Risk Management Committee were accepted by the Board.
Subsidiary/ Joint Venture/ Associate Company
As on March 31, 2023, the Company has a wholly owned subsidiary named Smartx Services Limited. In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements of the Company and its subsidiary, which forms part of this Integrated Report. A statement in Form AOC- 1, containing the salient features of the Financial Statements of the subsidiary company is annexed as Annexure A to this report. The statement also provides the details of the performance and financial position of the subsidiary company.
Audited Financial Statements of Smartx Services Limited for the Financial Year 2022-23 have been placed on the website of the Company at www.industowers.com and the same will also be available electronically for inspection by the members during the AGM. The audited Financial Statements of the subsidiary company are available for inspection at the Companyâs registered office and registered office of the subsidiary company. Shareholders interested in obtaining a copy of the audited financial statements of the subsidiary company may write to the Company Secretary at the Companyâs registered office.
The Company does not have any joint venture company or an associate company as on March 31,2023.
At Indus Towers, we believe that our people are key to the success of our business. Indus Towers has set an example for several organizations in India by leading the way and demonstrating how putting people front and center in organizational initiatives can lead to achieving higher levels of business performance.
We have our employees at the core of business who deliver and sustain the service delivery by living the core values of the organization- Excellence, Customer, Integrity, Teamwork
and Environment (ExCITE). They relentlessly work towards our vision to Strive for Customer Delight through continuous Innovation. Many employees and organizations spent last year settling into their new ways of working after the initial, prolonged disruption of the pandemic subsided. This adjustment period coincided with an uncertain economy, continued resignations and âquiet quittingâ making headlines amid declining employee engagement after a decade of growth.
The Gallup Exceptional Workplace Award (2023) awarded to Indus Towers is a testament to the fact that despite these challenges, we as an organization stood strong with our values and built a culture that thrives in the new work environment. For a young organization like Indus Towers, which operates in the B2B space, defining and percolating an organization wide culture and becoming an employer of choice are two important and interrelated aspects. The fact that we have received this award for the 10th consecutive year establishes the fact that to be among the most engaged workplaces across the world, we must continue to put people first and continue to make employee engagement a cultural priority in our business strategy.
During our journey, we realized that the first step in creating an employer brand is to define and articulate the culture which proves to be a differentiating factor for external and internal employees. Connecting and engaging with 3,249 employees spread across our 22 circles has become possible through our constant communication. Our leadership has a strong connect with all employees and focusing on their well-being is their priority. They regularly connect with the teams to guide them on how to efficiently manage people and productivity during critical times. Throughout the year, the leadership stood by their people in times of crisis, valuing their relentless efforts and providing all type of support that was needed.
The year gone by was transformational yet extremely demanding for our workforce at Indus. While on one side rigor on 5G roll out was one of the biggest ask from our customers, there has been a war of talent in the market for this niche skill. To address the situation in time, we ensured that we proactively start upskilling our current workforce. We invested in our talent through various training interventions and awareness sessions delivered by the Leaders and Subject Matter Experts to get 5G ready and ensured that we deliver on the expectations of our valued customers. At Indus, we constantly strive to build and sustain a culture of high performance and recognise that our employees play a crucial role in catalyzing growth and innovation in the organization. We aim to build a future-ready, resilient, and nimble workforce. Our strategic approach to creating a pool of best-in-class talent is guided by a three-dimensional approach:
⢠Attracting the right talent
⢠Retaining the better
⢠Advancing the best
Our unique employee value proposition and integrated approach to employee development align organizational values with the personal values of the employees thus helping them achieve breakthrough results.
The communication strategy at Indus has been instrumental in keeping the morale of the employees high while ensuring their engagement at the same time. At Indus Towers, we believe in embracing technology and continue to use it to our advantage to make processes simpler and more efficient. We continue to automate our processes, use of the systems and technological shifts have made it even more important for people to become âfit for the futureâ, both as professionals and as individuals. Keeping this in mind, we constantly organize various learning and development initiatives for our employees. While during the pandemic we capitalized on virtual and online learning, this year we also brought back many classroom training interventions. Keeping the development opportunities relevant and engaging, this was a year of many new launches for Indus Towers when it came to future ready capability building for our employees. We reviewed our existing courses and made improvements as per the changing needs, future skills and Training Needs identified. As part of our commitment towards holistic development, employees are continuously being encouraged to go for external certifications and MDP programs from elite institutions like ISB, IIMs, etc. At Indus, we focus on building an overall employee experience and engagement & well-being forms the core of it. Our aim is to make our people proud of the work they do at Indus. We not only want them to excel, but we also want them to realize their contribution to the organization and provide them opportunities to learn and grow.
Diversity and Inclusion is at the heart of Indus. Over the years we have been constantly working on strengthening our policies and processes to provide a safe, equal and inclusive work environment for all. We have been successful in onboarding diverse talent not only for office-based roles but also in the field. While being an engineering and hardcore technical organization, where availability of diverse talent is limited, share of women in our total employee population is 6.3% and we are determined to improve this year on year.
Continuing our efforts to ensure a conducive and safe environment for women employees, we have a mandatory training on POSH added to our online learning module. We also have a neutral Internal Complaints Committee which investigates and takes appropriate action on any concerns related to harassment raised by employees. Apart from this, many engagement initiatives are planned and calendarized for D&I. Talks by Women Leaders were held for I-WIN network, which is a Pan Indus womenâs network focused on networking, learning and growing. Year 2022 marked the launch of Gender Sensitization Workshops. This is
an organization wide effort to build an inclusive workplace for our employees and create awareness on the ground to address gender sensitive issues.
To retain, promote and motivate the best talent in the Company and to develop a sense of ownership among employees, the Company has instituted an Employee Stock Option Scheme 2014 (âESOP Scheme 2014â) with the approval of Shareholders of the Company. The said scheme is in compliance with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (âESOP Regulationsâ). The HR, Nomination and Remuneration Committee monitors the Companyâs ESOP scheme. The Company also had another ESOP Scheme (âESOP Scheme - 2008â) under which no fresh grants are made, and all options granted under the Scheme have been dealt with.
In accordance with the ESOP Regulations, the Company had set up Indus Towers Employeesâ Welfare Trust (ESOP Trust) for the purpose of implementation of ESOP Schemes. Both the ESOP schemes are administered through ESOP Trust, whereby shares held by the ESOP Trust are transferred to the employees, upon exercise of stock options as per the terms of the Scheme. In terms of ESOP Regulations, neither the ESOP Trust nor any of its trustees had exercised voting rights in respect of the shares of the Company held by the ESOP Trust.
During the Financial Year 2022-23, ESOP Trust has purchased 525,000 equity shares from the open market and HR, Nomination and Remuneration Committee has granted 782,303 stock options under the ESOP Scheme 2014. A detailed report with respect to options exercised, vested, lapsed, exercise price, vesting period etc. under ESOP Scheme 2008 and ESOP Scheme 2014 is disclosed on the website of the Company at https://www.industowers.com/investor/shares/.
A certificate from Chandrasekaran Associates, Secretarial Auditors of the Company, certifying that the ESOP schemes are implemented in accordance with the ESOP Regulations and the resolutions passed by the Members of the Company, are available for inspection by the Members in electronic mode and copy of the same will also be available for inspection at the registered office of the Company and during the AGM.
During the previous year, there were no material changes in the aforesaid ESOP scheme of the Company and the ESOP scheme are in compliance with ESOP regulations.
Auditors and Auditorsâ Report Statutory Auditors & their Report
In terms of the provisions of Section 139 of the Companies Act, 2013, M/s Deloitte Haskins & Sells LLP, Chartered Accountants, (firm registration number 117366W/ W-100018) (âDeloitteâ) were re-appointed as the Statutory Auditors of the Company by the shareholders in the 16th Annual General Meeting (âAGMâ) of the Company held on August 23, 2022, for a period of five years i.e. from the conclusion of 16th AGM till the conclusion of 21st AGM of the Company, to be held in the year 2027.
Further, they are qualified to continue as Statutory Auditors of the Company and satisfy the independence criteria in terms of the applicable provisions of the Act and Code of Ethics issued by the Institute of Chartered Accountants of India.
The Board has duly examined the Statutory Auditorâs Report on the Standalone and Consolidated Financial Statements of the Company for the Financial Year ended March 31, 2023, which is self-explanatory. The report does not contain any observation, disclaimer, qualification, or adverse remarks.
Further, no fraud has been reported by the Statutory Auditors in terms of Section 143(12) of the Companies Act, 2013 during the Financial Year.
Secretarial Auditors & their Report
The Company had appointed M/s. Chandrasekaran Associates, Company Secretaries, New Delhi, to conduct its Secretarial Audit for the Financial Year ended March 31, 2023. The Secretarial Auditors have submitted their report, confirming compliance by the Company on applicable provisions as stated in their report. The Report does not contain any qualification, observation, disclaimer, or adverse remark except following:
The Company had received an adjudication order from the Securities Exchange Board of India (âSEBIâ) dated June 27, 2022 for violation of erstwhile Regulation 3(12) of SEBI (Share Based Employees Benefits) Regulations, 2014 w.r.t. non-appropriation of the excess 5,32,862 equity shares held by ESOP Trust of the Company and a fine of Rs. 1,00,000/- was imposed by SEBI.
The Company denies violation of Regulation 3(12) of the erstwhile SEBI (Share Based Employee Benefits) Regulations, 2014, however, has paid the prescribed penalty on ground of interpretational differences.
The Secretarial Audit Report for the Financial Year 2022-23 is annexed as Annexure B to this report.
The Board has re-appointed M/s. Chandrasekaran Associates, Company Secretaries, New Delhi, as the Secretarial Auditors of the Company for the Financial Year 2023-24.
Internal Auditor and Co-source Partner
The Company has in place a robust Internal Audit team which is headed by the Internal Auditor and ably supported by reputable independent firms.
Mr. Sarabhjit Singh is the Internal Auditor of the Company and PricewaterhouseCoopers Private Limited (PwC) and ANB Solutions Private Limited (ANB) were engaged as the cosourced partners for the year.
The audit conducted by the Internal Auditor and co-sourced partners is based on an internal audit plan, which is reviewed each year in consultation with the Audit & Risk Management Committee. As per the report of the Internal Auditor, the policies, processes, and internal controls in the Company are generally adhered to, while conducting the business.
Corporate Social Responsibility (CSR)
In line with the companyâs vision of Connecting Lives across nation, the CSR initiatives of the Company are guided to ensure sustainable development and inclusive growth while taking care of People, Planet, and organizational goals. The CSR Vision of Indus endeavors on taking an active role in transforming the lives of communities by designing and implementing projects that works towards socio-economic upliftment of the communities. The Company has made conscious efforts to ensure that CSR interventions are need-based, community-oriented, sustainable, and thereby positively impact the quality of lives and also those present in the ecosystem.
At Indus, we believe that our business thrives in a strong and sustainable society and therefore our commitments, focus on integrity, empathy and ethics shape the Indus value system. As a socially responsible organization, we harmonize our short term and long-term goals to consistently strive to serve society in a holistic manner to create a larger social impact. CSR activities through partnership with the government, particularly at the local level, and not-for-profit sector, plays a vital role not only for effective implementation of CSR activities but also for long-term sustainability and to achieve measurable change brought about by social initiatives.
The CSR Policy aligns with the Missions of National Priority and the Sustainable Development Goals (SDGs) of India. The policy is recommended by Corporate Social Responsibility (CSR) Committee and approved by the Board. It has a deep focus on governance and transparency and outlines the Companyâs CSR Strategy to bring about a positive impact on the community and environment through various CSR interventions.
Indus CSR activities are aligned with Schedule VII of the Companies Act and majorly focus on:
⢠Promoting Quality Education and Digital Education for children, youth and adults in rural and urban areas
⢠Digital Skill Development and Livelihood Enhancement for vulnerable communities
⢠Promoting Smart Agri for farmers by leveraging Technology
⢠Scholarship Program for higher education including students with disabilities.
⢠Support to Paraplegic Rehabilitation Centre for Armed Forces Ex- service men
⢠Holistic development of abandoned and parentless children
⢠Promote Community initiatives
⢠Healthy and Safer community environment and capacity building of health Infrastructure
⢠Energy Access for livelihood promotion thereby promote Safe and Clean Energy
⢠Environment Sustainability and Swachh Bharat initiatives including Research & development
⢠Support Disaster Relief initiatives
CSR programs at Indus are implemented by credible partners and are compliant to execute social development projects. These partners are selected based on a robust due diligence process. All our projects are closely monitored and governed by the Board of Directors and the CSR Committee and managed by the CSR council members.
Company-wide, Indus utilizes its strengths and resources to benefit local communities. Individually, our employees through volunteering programs actively engage in community service and contribute their time, efforts, and resources to bring in positive change in community.
In accordance with the requirements of Section 135 of the Companies Act, 2013 and rules made thereunder, the Company has constituted the CSR Committee. The composition and terms of reference of the CSR Committee is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
The Company has also formulated a Corporate Social Responsibility Policy, to ensure that the CSR programs of the Company reflect its vision and values and are aligned with the applicable regulatory requirements.
The CSR Policy is available at the website of the Company at https://www.industowers.com/wp-content/uploads/2022/05/ CSR-Policy.pdf. The details of the composition of CSR Committee, CSR projects, programmes and the Annual Action Plan are also available on the website of the Company.
During the Financial Year 2022-2023, the Company was required to spend H 984.23 Mn (2% of average net profits for the last 3 years) towards the CSR activities out of which the Company has spent H 914.85 Mn till March 31,2023. The remaining amount of H 69.38 Mn towards the ongoing projects has been transferred to the unspent CSR Account of the Company in compliance with the requirement of Section 135(6) of the Companies Act, 2013.
A detailed update on the CSR initiatives of the Company is provided in the Social Capital section, which forms part of this Integrated Report. The Annual Report on Corporate Social Responsibility u/s 135 of the Companies Act, 2013 is annexed as Annexure C to this Report.
In line with our philosophy of being a highly transparent and responsible company and considering IR as a journey, the Company has adopted âIntegrated Reportâ in accordance with the International Integrated Reporting Council (IIRC) framework.
The Integrated Report covers the capital approach of IIRC Framework as well as the value that the Company creates for its stakeholders.
Business Responsibility and Sustainability Report
In accordance with the Regulation 34(2)(f) of Listing Regulations read with SEBI Circular no. SEBI/HO/CFD/CMD-2/P/CIR/2021/562 dated May 10, 2021, the Business Responsibility & Sustainability Report (âBRSRâ) for the Financial Year 2022-23, describing the initiatives taken by the Company from environmental, social and governance perspective forms part of this Integrated Report.
Management Discussion and Analysis Report
The Management Discussion and Analysis Report for the Financial Year under review, as stipulated under Regulation 34 of the Listing Regulations, is presented in a separate section, forming part of this Integrated Report.
The Company is committed to benchmark itself with global standards and adopting the best corporate governance practices. The Board constantly endeavors to take the business forward in such a way that it maximizes the long-term value for the stakeholders. The Company has put in place an effective corporate governance system which ensures that the provisions of the Listing Regulations are duly complied with.
A detailed report on the Corporate Governance pursuant to the requirements of the Listing Regulations forms part of this Integrated Report.
A certificate from the Statutory Auditors of the Company, M/s Deloitte Haskins & Sells LLP, Chartered Accountants, confirming compliance of conditions of corporate governance as stipulated in the Listing Regulations is annexed as Annexure D to this report.
Risk management is embedded in Indus Towersâ operating framework. The Company believes that risk resilience is key to achieving higher growth. To this effect, there is a robust process in place to identify key risks across the Company and prioritize relevant action plans to mitigate these risks. The Risk Management framework is reviewed periodically by the Board and the Audit & Risk Management Committee, which includes discussing the management submissions on risks, prioritizing key risks and approving action plans to mitigate such risks.
The Company has a duly approved Risk Management Policy for effective corporate governance and development of sustainable business. The objective of this policy is to have a well-defined approach to risk and to define an ongoing and consistent process for identifying, evaluating, escalating, monitoring, and reporting the significant risks faced in the short and near future. The policy suggests framing an appropriate response for the key risks identified, to make sure that risks are adequately addressed or mitigated.
The Internal Audit function along with Chief Risk Officer assists the Audit & Risk Management Committee on an independent basis with a review of the risk assessment and associated management action plans.
Operationally, risk is being managed at the top level by the Management Committee, chaired by the Managing Director & Chief Executive Officer.
Detailed discussion on Risk Management forms part of Management Discussion & Analysis under the section âRisks and Concernsâ which forms part of this Integrated Report. At present, in the opinion of the Board of Directors, there are no risks which may threaten the existence of the Company.
Internal Financial Controls and their adequacy
The Company has established a robust framework for internal financial controls. The Company has in place adequate controls, procedures, and policies ensuring orderly and efficient conduct of its business, including adherence to the Company policies, safeguarding its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information. During the year, such controls were assessed and no reportable material weaknesses in the design or operation were observed. Accordingly, the Board is of the opinion that the Companyâs internal financial controls were adequate and effective during the Financial Year 2022-23. The Internal financial controls of the Company have been further discussed in detail in the Management Discussion & Analysis section.
Code of Conduct/ Vigil Mechanism
We have a well defined Code of Conduct that serves as a guiding tool to align our organsational culture with individual conduct.
The Code of Conduct and vigil mechanism of the Company is available on the website of the Company at www.industowers.com.
A brief note on the highlights of the Ombudsman Policy/ Whistleblower Policy and compliance with Code of Conduct is also provided in the Report on Corporate Governance which forms part of this Integrated Report.
We at Indus Towers believe that quality control acts as an important differentiator and driving force behind customer delight through the achievement of high uptime and decreasing energy cost across our footprint.
We continue to fine tune our quality strategies in line with our expanding footprints with the aim of ensuring First Time Right.
The multi-pronged strategies are continually refined in line with changing field dynamics. The stage inspection of on-site work is undertaken by quality engineers for new build sites and major upgrades. Quality audits by independent agencies are undertaken on a regular basis to ensure additional controls. Preventive maintenance audits, process and design improvement and control ensure standardization and quality of workmanship.
We have continued with major project audits such as Electrical Hygiene Audits, Fire Solution Audits, Civil Audits, Refurbished Equipment Audits. Tower maintenance and Foundation strengthening audits to enhance the performance of sites from a long-term performance and safety perspective. As a unique exercise, we have been imparting product and process trainings to vendors / partners along with quality team on the field, thereby contributing to the organizationâs cause of delivering products at right time and at low price while maintaining the desired quality standards.
Quality also assures that products comply with specifications through pre-dispatch inspection of products.
Other Statutory Disclosures Related Party Transactions
A detailed note on the procedure adopted by the Company in dealing with contracts and arrangements with Related Parties is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
All arrangements / transactions entered into by the Company with its related parties during the year were in ordinary course of business and on an armâs length basis. Particulars of material transactions with related parties, under the provisions of the Companies Act, 2013, are given in form AOC- 2 as Annexure E to this report.
The names of related parties and details of transactions with them under Ind AS - 24 have been included in Note no. 39 of the Standalone Financial Statements for the Financial Year ended March 31,2023.
The Policy on the Related Party Transactions is available on the website of the Company at https://www.industowers.com/wp-content/themes/indus/pdf/2022/RPT Policy.pdf.
Significant and material orders
There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and the Companyâs operations in future.
Material changes and commitments affecting financial position between the end of Financial Year and date of the report
There is no material change or commitment affecting the financial position of the Company between the end of Financial Year and date of the report.
Particulars of loans, guarantees or investments
The details of loans given, investments made or guarantees given are provided in Note no. 6, 7 and 12 of the Standalone Financial Statements for the Financial Year ended March 31, 2023.
Commercial Papers
During the Financial Year, the Company has raised H 23,250 Mn through issuance of Commercial Papers in various tranches. As on March 31, 2023, the Company has no outstanding Commercial Papers.
Particulars of Employees
Disclosures relating to remuneration of Directors u/s 197(12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed as Annexure F to this report.
Particulars of employeesâ remuneration as required under Section 197(12) of the Act read with Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this report. However, in terms of the provisions of the first proviso to Section 136(1) of the Act, the Integrated Report is being sent to the Shareholders excluding the aforementioned information. The information will be available on the Companyâs website at https://www. industowers.com and will also be available for inspection at the registered office of the Company on all working days (Monday to Friday) between 11.00 a.m. and 1.00 p.m. upto the date of AGM and a copy of the same will also be available electronically for inspection by the members during the AGM. Any member interested in obtaining such information may write to the Company Secretary at the Registered Office of the Company up to the date of the ensuing Annual General Meeting.
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo
The details of energy conservation, technology absorption and foreign exchange earnings and outgo as required under Section 134(3) of the Companies Act, 2013, read with the Rule 8 of Companies (Accounts) Rules, 2014 is annexed herewith as Annexure G to this report.
Disclosure under Section 197(14) of Companies Act, 2013
The Company does not have any holding company.
The Managing Director & CEO and the Chairman of the Company do not receive any remuneration or commission from the subsidiary company.
Annual Return
In terms of provisions of Section 92, 134(3)(a) of the Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules, 2014, the draft Annual Return having all the available information of the Company as on March 31, 2023, is available on the website of the Company at www.industowers.com.
Maintenance of Cost Records
The Company is not required to maintain cost records as specified under Section 148(1) of the Companies Act, 2013.
Proceeding under Insolvency and Bankruptcy Code, 2016
There were no proceedings, either filed by the Company or against the Company, pending under the Insolvency and Bankruptcy Code, 2016 as amended, before the National Company Law Tribunal or other Courts as on March 31, 2023.
Change in the Nature of Business
There was no change in nature of the business of the Company during the financial year ended on March 31,2023.
The details of difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the banks or financial institutions along with the reasons thereof
There is no one time settlement done with bank or any financial institution.
Prevention of Sexual Harassment at Workplace
The Company has an Internal Complaints Committee for providing a redressal mechanism pertaining to sexual harassment of employees at workplace. Details of the same including the details of the complaints received are provided in the Report on Corporate Governance, which forms part of this Integrated Report.
Pursuant to the provisions of Section 118 of the Companies Act, 2013, the Company has complied with the applicable provisions of the Secretarial Standards issued by the Institute of Companies Secretaries of India and notified by Ministry of Corporate Affairs.
Directorsâ Responsibility Statement
Pursuant to Section 134(5) of the Companies Act, 2013, the Directors to the best of their knowledge and belief confirm that:
I. In the preparation of the annual accounts for the year ended March 31, 2023, the applicable accounting standards had been followed and there is no material departure from the same;
II. The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year ended March 31,2023, and of the profit of the Company for the year ended on that date;
III. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
IV. The Directors had prepared the annual accounts on a going 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 are operating effectively;
VI. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.
The Directors wish to place on record their appreciation for the assistance and co-operation extended by customers, strategic investors, shareholders, bankers, vendors, business partners, various agencies and departments of Government of India and State Governments where Companyâs operations are existing and look forward to their continued support in the future.
The Directors would also like to place on record their sincere appreciation for the valuable contribution, unstinted efforts and the spirit of dedication shown by the employees of the Company at all levels.
For and on behalf of the Board of Directors of Indus Towers Limited N Kumar Prachur Sah
Date: April 26, 2023 Chairman Managing Director & CEO
Place: Gurugram DIN: 00007848 DIN: 07871676
Mar 31, 2022
Your Directors are pleased to present the Sixteenth Boardâs Report on the business and operations of Indus Towers Limited (formerly Bharti Infratel Limited) (âthe Companyâ) together with the audited financial statements for the financial year ended March 31,2022.
Indus Towers is a provider of tower and related infrastructure sharing services. We are one of the largest telecom tower companies in India basis the number of towers and co-locations operated by the Company. The business of Indus Towers is to deploy, own, operate and manage passive infrastructure pertaining to telecommunication operations. The Company provides access to its towers, primarily to wireless telecommunication service providers, on a shared basis under long-term contracts. Your Company has a nationwide presence with operations in all 22 telecommunication circles in India and caters to all wireless telecommunication service providers in India.
As of March 31,2022, Indus Towers owned and operated 185,447 towers with 335,791 co-locations in 22 telecommunication circles.
As one of the largest telecom tower companies in India, it is imperative that Indus Towers combats the COVID-19 pandemic by ensuring seamless connectivity to the customers while maintaining and ensuring employeesâ safety and well-being. Our employees worked overtime to ensure that the vital connectivity is maintained at all times while enforcing social distancing and other safety protocols to contain the spread of the second and third waves of the pandemic during the financial year 2022.
The financial statements of the Company have been prepared in accordance with the Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (âthe Actâ) read with Companies (Accounts) Rules, 2014.
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A. Consolidated financial results as per Ind AS ? Millions |
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|
Particulars |
Year ended March 31, 2022 |
Year ended March 31,20211 |
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|
Revenue2 |
277,172 139,543 |
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EBIDTA2 |
149,429 72,599 |
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Profit before Tax |
84,307 47,569 |
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Profit after Tax |
63,731 37,790 |
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1 Basis Equity Method 2 Revenue & EBITDA are excluding other income B. Standalone financial results as per Ind AS ? Millions |
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Particulars |
Year ended March 31, 2022 |
Year ended March 31, 2021 |
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|
Revenue1 |
277,082 139,508 |
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EBIDTA1 |
149,305 72,586 |
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Profit before Tax |
84,243 43,160 |
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Profit after Tax |
63,671 33,382 |
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1 Revenue & EBITDA are excluding other income |
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The results for the previous financial year include the results of erstwhile Indus Towers Limited which merged with and into the Company w.e.f. November 19, 2020 for the period subsequent to that date till the end of the financial year (Refer Notes of the Standalone/Consolidated Financial Statements for further details). Accordingly, the figures for the previous financial year ended March 31,2021 are not comparable with the figures of the current financial year ended March 31,2022.
During the financial year 2021-22, there is no change in the Authorized share capital of the Company and it stood at ? 35,500,000,000/- divided into 3,550,000,000 equity shares of ? 10/- (? Ten) each.
During the year, there was no change in the Companyâs issued, subscribed and paid-up equity share capital.
As on March 31,2022, the issued, subscribed and paid-up equity share capital of the Company is ? 269,493,69,500/- divided into 2,694,936,950 Equity Shares of ? 10/- (? Ten) each fully paid-up.
The Company has not transferred any amount to the General Reserve for the financial year ended March 31,2022.
On May 5, 2022, the Board has declared an interim dividend of H 11/- per equity share of ? 10/- each fully paid up (110% of face value) amounting to ? 29,644.31/- Mn for the financial year 2021-22.
Dividend Distribution Policy
As per Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âthe Listing Regulationsâ), top 1000 listed companies based on the market capitalization shall formulate a dividend distribution policy. Accordingly, the policy was adopted by the Board of Directors of the Company to set out the parameters and circumstances that will be taken into account by the Board in determining the distribution of dividend to its shareholders and / or retaining profits earned by the Company. The dividend distribution policy is available on the Companyâs website at https://www.industowers.com/wp-content/themes/ indus/pdf/policv/Dividend-Policv.pdf.
As on the date of this report, CRISIL Limited rated their LongTerm Rating to CRISIL AA / Stable, Short-term rating to CRISIL A1 (Reaffirmed) and Bond rating to CRISIL AA / Stable. It also reaffirmed the Commercial Papers Rating to CRISIL A1 assigned to the Company. Further, ICRA Limited rated the NonConvertible Debentures rating to [ICRA] AA (Stable), Term Loans rating to [ICRA] AA (Stable), Fund based/ Non-fund based rating to [ICRA] AA (Stable) and rating of unallocated limits to [ICRA] AA (Stable)/ A1 . It also reaffirmed the Commercial Papers Rating to [ICRA] A1 and issuer rating to [ICRA] AA (Stable) assigned to the Company.
Transfer of amount to Investor Education and Protection Fund
Pursuant to the provisions of Section 124 of Companies Act, 2013 during the Financial Year 2021-22, the Company has transferred an amount of ? 150,260/- (Rupees One Lakh Fifty
Thousand Two Hundred and Sixty Only) pertaining to final dividend on equity shares for financial year 2013-14, and ? 1,64,619/- (Rupees One Lakh Sixty Four Thousand Six Hundred and Nineteen Only) pertaining to interim dividend for financial year 2014-15, which remained unpaid/ unclaimed for a period of seven years, to Investor Education and Protection Fund (IEPF) established by the Central Government.
Further, 241 equity shares of the Company on which the dividend remained unpaid/ unclaimed for a period of seven consecutive years were also transferred to IEPF in accordance with the Act and rules thereunder after giving due notice to the concerned shareholders.
The investors whose shares and dividend amount have been transferred to IEPF may claim their shares and seek refund in accordance with the provisions of law. The details regarding the above along with the process for claiming the unpaid dividend / shares is available on the website of the Company at https:// www.industowers.com/investor/shares/.
The Company has also uploaded the details of unpaid and unclaimed dividend amounts lying with the Company as on August 3, 2021 (date of last Annual General Meeting) on the website of the Company at https://www.industowers.com/ investor/shares/?var=1657517893.
Nodal Officer
In accordance with the provisions of Rule (2A) of Rule 7 of Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, Ms. Samridhi Rodhe has been appointed as the Nodal Officer of the Company. The details are available on the Companyâs website at www.industowers.com.
Deposits
The Company has not accepted any deposit and as such no amount of principal or interest was outstanding as on the date of the balance sheet.
Directors and Key Managerial Personnel
Induction, Re-appointment and Resignation
Pursuant to the provisions of the Companies Act, 2013, Mr. Bimal Dayal (DIN: 08927887), Managing Director & CEO, Mr. Thomas Reisten (DIN: 06900067) and Mr. Gopal Vittal (DIN: 02291778), Non-Executive Non-Independent Directors of the Company
will retire by rotation at the ensuing AGM and being eligible, have offered themselves for re-appointment. The Board, on the recommendation of the HR, Nomination and Remuneration Committee, recommends their re-appointment as Directors liable to retire by rotation at the ensuing AGM.
Ms. Anita Kapur (DIN: 07902012) is going to complete her first term as an Independent Director of the Company on January 16, 2023. On the recommendation of the HR, Nomination and Remuneration Committee, the Board in its meeting held on May 5, 2022, subject to the approval of the shareholders, has reappointed her as an Independent Director for a further term of five years w.e.f. January 17, 2023 to January 16, 2028. The Company has received requisite notice from a member under Section 160 of the Companies Act, 2013 proposing the appointment of Ms. Anita Kapur as Independent Director. The Board recommends her re-appointment at the ensuing AGM. In the opinion of the Board, she possesses requisite qualifications, experience, expertise, proficiency and hold high standards of integrity.
Mr. Balesh Sharma (DIN: 07783637), Non-Executive NonIndependent Director of the Company has resigned from the Board w.e.f. June 30, 2022. The Board placed on record its sincere appreciation for the guidance and contribution made by him during his tenure on the Board.
Pursuant to the provisions of Section 161 and other applicable provisions of the Companies Act, 2013 and applicable provisions of the Listing Regulations and as recommended by HR, Nomination and Remuneration Committee, Mr. Sunil Sood (DIN: 03132202), was appointed as an Additional Director in the capacity of a Non-Executive Non-Independent Director w.e.f June 30, 2022. He will hold office up to the date of ensuing AGM. The Company has received requisite notice from a member under Section 160 of the Companies Act, 2013 proposing the appointment of Mr. Sunil Sood as Director, liable to retire by rotation. The Board recommends his appointment as a Director liable to retire by rotation at the ensuing AGM.
Brief resume, nature of expertise, disclosure of relationships between directors inter-se, details of directorships and Committee membership held in other companies of the Directors proposed to be appointed/ re-appointed, along with their shareholding in the Company, as stipulated under Secretarial Standard- 2 and Regulation 36 of the Listing Regulations, is appended as an Annexure to the Notice of the ensuing AGM.
Declaration by Independent Directors
The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria
of independence as prescribed under Section 149 of the Companies Act, 2013 and Regulation 16 & 25 of the Listing Regulations. The Independent Directors have also confirmed that they have complied with the Companyâs code of conduct.
Policy on Nomination, Remuneration and Board Diversity
The Company believes that building a diverse and inclusive culture is integral to its success. A diverse Board will be able to leverage different skills, qualifications, professional experiences, perspectives and backgrounds, which is necessary for achieving sustainable and balanced development. The Board has adopted a Policy on Nomination, Remuneration and Board Diversity, on appointment and remuneration of Directors, Key Managerial Personnel & Senior Management.
The Policy, inter-alia, includes criteria, terms and conditions for determining qualifications, competencies and positive attributes for appointment of Directors (executive and non-executive including independent directors), Key Managerial Personnel and persons who may be appointed in Senior Management positions, their remuneration and diversity in the Board etc. The detailed policy is available on the website of the Company at https:// www.industowers.com/wpcontent/themes/indus/pdf/Policv-on-Nomination-Remuneration-and-Board-Diversitv.pdf.
Annual Board Evaluation and Familiarisation Programme for Board Members
The Company has adopted a structured induction programme for orientation and training of Directors at the time of their joining. A note on the familiarisation programme is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
The HR, Nomination and Remuneration Committee, has put in place a robust framework for evaluation of the Board, Board Committees and Individual Directors including the Independent Directors, Chairman and MD & CEO. Customized questionnaires were circulated, responses were analysed, and the results were subsequently discussed by the Board. Recommendations arising from the evaluation process were duly considered by the Board to further augment its effectiveness. A detailed update on the Board Evaluation is provided in the report on Corporate Governance which forms part of this Integrated Report.
During the financial year 2021-22, the Board of Directors met 5 times i.e. on April 22, 2021; July 29, 2021; October 25, 2021, January 27, 2022 and February 21, 2022. The period between
any two consecutive meetings of the Board of Directors of the Company was not more than 120 days.
The details regarding composition, number of Board meetings held, and attendance of the Directors during the financial year 2021-22 are set out in the Report on Corporate Governance which forms part of this Integrated Report.
The Company has several Board Committees which have been established as part of the best corporate governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes. As on March 31, 2022, the Board has 6 Committees, namely, Audit & Risk Management Committee, HR, Nomination and Remuneration Committee, Corporate Social Responsibility (CSR) Committee, Stakeholdersâ Relationship Committee, Environmental, Social and Governance (ESG) Committee and Special Committee of Directors. The details with respect to the composition, powers, roles, terms of reference, number of meetings held etc. of the Committees during the financial year 2021-22 and attendance of the members at each Committee meeting is provided in the Report on Corporate Governance which forms part of this Integrated Report.
All the recommendations made by the Committees of the Board including the Audit & Risk Management Committee were accepted by the Board.
Subsidiary/ Joint Venture/ Associate Company
As on March 31, 2022, the Company has a wholly owned subsidiary named Smartx Services Limited.
In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements of the Company and its subsidiary, which forms part of this Integrated Report. A statement in Form AOC- 1, containing the salient features of the financial statements of the subsidiary company is annexed as Annexure A to this report. The statement also provides the details of performance and financial position of the subsidiary company.
Audited financial statements of Smartx Services Limited for the Financial Year 2021-22 have been placed on the website of the Company at www.industowers.com. The audited financial statements of the subsidiary company are available for inspection at the Companyâs registered office and registered office of the subsidiary company. Shareholders interested in obtaining a copy of the audited financial statements of subsidiary company may write to the Company Secretary at the Companyâs registered office.
The Company does not have any joint venture company or an associate company as on March 31, 2022.
At Indus Towers, we believe that our people are key to the success of our business. Indus Towers has set an example for several organizations in India by leading the way and demonstrating how putting people front and center in organizational initiatives can lead to achieving higher levels of business performance.
Its values ExCITE -- Excellence, Customer, Integrity, Teamwork and Environment -- foster a culture of alignment and trust where employees find more fulfilment in their work. Despite unprecedented challenges in the telecom industry in India, Indus Towers has navigated change through its sound people strategy. It is the commitment and dedication of our employees that enabled us to keep nation remain connected even amidst adversities and the challenges posed by the COVID-19 pandemic. Our human capital has, therefore, played a pivotal role in shaping Indus Towers into what we are today.
We are building a culture where change is seen as an ongoing process for self-growth and progress. Its ninth consecutive Gallup Exceptional Workplace Award is a testament to its mission, which reiterates our purpose for existence - to transform lives through sustainable Digital Infrastructure and Services which again has been defined post deliberation of our 3,000 employees coming together to decide what should be the Mission & Vision of the company through a process called Large Scale Interactive Process (LSIP). For a young organization like Indus Towers, which operates in the B2B space, defining and percolating an organization wide culture and becoming an employer of choice are two important and interrelated aspects.
During our journey, we have realized that the first step in creating an employer brand is to define and articulate the culture which proves to be a differentiating factor for external and internal employees. Connecting and engaging with 3,248 employees spread across our 22 circles has become possible through our constant communication especially in time of COVID-19 pandemic. Our leadership has always been the first one to communicate with all employees and focus on their well-being is their priority. Throughout the year, the leadership stood by their people in times of crisis valuing their relentless efforts and providing any type of support that was needed. Not only did they prioritise their health and safety, but also implemented methods to ease anxiety and improve productivity during these tough times.
The communication strategy at Indus has been instrumental in keeping morale of the employees high while ensuring their
engagement at the same time. At Indus Towers, we believe in embracing technology and continue to use it to our advantage to make processes simpler and more efficient. We continue to automate our processes, use the systems and technological shifts have made it even more important for people to become âfit for the futureâ, both as professionals and as individuals. Keeping this in mind, we constantly organize various learning and development initiatives for our employees. Due to the pandemic, new methods of learning have emerged, and our employees continue to adapt with new-age processes. During the year under review, we strengthened our online learning platform- Oracle Learning Cloud (OLC) by conducting e-learning as well as blended learning. We reviewed our existing courses and made improvements as per the changing needs. We conducted a rapid triage of the entire portfolio of learning offerings and set priorities for what will be necessary to adapt to a virtual/blended or digital only format. To ensure employee safety at workplace, every new employee is required to undergo mandatory safety training as well as Competency Development Program (CDP) which introduces them to understand important concepts and their application in the context of their work. As part of our commitment towards holistic development, employees are continuously being encouraged to go for external certifications and MDP programs from elite institutions like ISB, IIMs, etc. At Indus, we focus on building an overall employee experience and engagement & well-being forms the core of it. Our aim is to make our people proud of the work they do at Indus. We not only want them to excel, but we also want them to realize their contribution to the organization and provide them opportunities to learn and grow.
Some of the key initiatives undertaken during the year included:
⢠Volunteering programs organized under Personal Social Responsibility (PSR) was organized involving more than 1,100 volunteers impacting over 9,000 beneficiaries. Joy of Giving Week Celebrated- 793 employees participated in activities such as recycling drive, plantation drive, book donation drive, food distribution, clothes donation, visit to old age home etc.
⢠Conducted financial wellness programs that were designed to help employees manage their finances better Programs were conducted on a regular basis to help employees manage health and stress in work and personal environment focusing on the overall physical and mental wellbeing. Inhouse Doctor and Advisor was onboarded to provide medical consultation. COVID-19 vaccination camps and drives were organized Pan India
⢠Social and emotional wellbeing formed an essential part of our wellbeing programs- Launch of Digital Reward &
Recognition Platform called i-appreciate to appreciate and recognize employees on the go. Regular field connect with employees, virtual/hybrid engagement initiatives were conducted to keep the connect stronger
Diversity and Inclusion is at the heart of Indus, over the years we have been constantly working on strengthening our policies and processes to provide a safe, equal and inclusive work environment for all. We have been successful in onboarding diverse talent not only for office-based roles but also in the field. While being an engineering and hardcore technical organization, where availability of diverse talent is limited, share of women in our total employee population is 5.8% and we are determined to improve this year on year.
Continuing our efforts to ensure a conducive and safe environment for women employees, we have a mandatory training on POSH added to our online learning module, which needs to be completed by all employees within a month of joining. We also have a neutral Internal Complaints Committee which investigates and takes appropriate action on any concerns related to harassment raised by employees. Apart from this, many engagement initiatives are planned and calendarized for D&I. Talks by Women Leaders were held for I-WIN network, which is a Pan Indus womenâs network focused on networking, learning and growing. We celebrated International Womenâs Day with excitement and our women employees who play a transformative role spoke about their experience at Indus that resounded our commitment to create a gender inclusive culture across the telecom infrastructure space. We celebrated the #ToweringWomenofIndus who take it upon themselves to lead purposefully and âBreak the Biasâ.
Employees Stock Option Plan
To retain, promote and motivate the best talent in the Company and to develop a sense of ownership among employees, the Company has instituted two ESOP schemes i.e. Employee Stock Option Scheme 2008 (ESOP Scheme 2008) and Employee Stock Option Scheme 2014 (ESOP Scheme 2014) with the approval of shareholders. The said schemes are in compliance with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, (ESOP Regulations). The HR, Nomination and Remuneration Committee monitors the Companyâs ESOP schemes.
In accordance with the ESOP Regulations, the Company had set up Indus Towers Employeesâ Welfare Trust (formerly Bharti Infratel Employeesâ Welfare Trust) (ESOP Trust) for the purpose of implementation of ESOP Schemes. Both the ESOP schemes are administered through ESOP Trust, whereby shares held
by the ESOP Trust are transferred to the employees, upon exercise of stock options as per the terms of the Scheme. In terms of ESOP Regulations, neither the ESOP Trust nor any of its trustees shall exercise voting rights in respect of the shares of the Company held by the ESOP Trust.
During the financial year 2021-22, Company has granted 656,144 stock options under the ESOP Scheme 2014. A detailed report with respect to options exercised, vested, lapsed, exercise price, vesting period etc. under ESOP Scheme 2008 and ESOP Scheme 2014 is disclosed on the website of the Company at https://www.industowers.com/investor/shares/.
A certificate from Chandrasekaran Associates, Secretarial Auditors of the Company, certifying that the schemes are implemented in accordance with the ESOP Regulations and the resolutions passed by the members, is available for inspection by the members in electronic mode and a copy of the same will also be available for inspection at the registered office of the Company.
Auditors and Auditorsâ Report Statutory Auditors & their Report
In terms of the provisions of Section 139 of the Companies Act, 2013, M/s Deloitte Haskins & Sells LLP, Chartered Accountants, (firm registration number 117366W-W100018) (âDeloitteâ) were appointed as the Statutory Auditors of the Company by the shareholders in the 11th AGM of the Company held on July 22, 2017, for a period of five years i.e. up to 16th AGM (ensuing AGM).
On the recommendation of the Audit & Risk Management Committee, the Board, in its meeting held on May 5, 2022 has recommended the re-appointment of Deloitte as the Statutory Auditors of the Company for a second term of five consecutive years i.e. from the conclusion of ensuing 16th AGM till the conclusion of 21st AGM to be convened in the year 2027. Accordingly, the re-appointment of Deloitte as the Companyâs Statutory Auditors, is placed for approval of the members. The Company has received the consent and a certificate from Deloitte to the effect that their appointment, if made, shall be in accordance with the provisions of Section 141 of the Companies Act, 2013.
The Board has duly examined the Statutory Auditorâs Report on the Standalone and Consolidated Financial Statements of the Company for the financial year ended March 31,2022 which is
self-explanatory. The report does not contain any observations, disclaimer, qualification or adverse remarks.
Further, no fraud has been reported by the Statutory Auditors in terms of Section 143(12) of the Companies Act, 2013 during the year.
Secretarial Auditors & their Report
The Company had appointed M/s. Chandrasekaran Associates, Company Secretaries, New Delhi, to conduct its Secretarial Audit for the financial year ended March 31, 2022. The Secretarial Auditors have submitted their report, confirming compliance by the Company of all the provisions of applicable corporate laws. The Report does not contain any qualification, observation, disclaimer or adverse remark. The Secretarial Audit Report for the financial year 2021-22 is annexed as Annexure B to this report.
The Board has re-appointed M/s. Chandrasekaran Associates, Company Secretaries, New Delhi, as the Secretarial Auditors of the Company for the Financial Year 2022-23.
Internal Auditor and Co-source Partner
The Company has in place a robust Internal Audit team which is headed by the Internal Auditor and ably supported by reputed independent firms.
Mr. Sarabhjit Singh is the Internal Auditor of the Company and PricewaterhouseCoopers Private Limited (PwC) and ANB Solutions Private Limited (ANB) were engaged as the Cosourced Partners for the year.
The audit conducted by the Internal Auditor and Co-sourced Partners is based on an internal audit plan, which is reviewed each year in consultation with the Audit & Risk Management Committee. As per the report of Internal Auditor, the policies, processes, and internal controls in the Company are generally adhered to, while conducting the business.
Corporate Social Responsibility (CSR)
The CSR Vision of Indus endeavors on taking an active role and responsibility in transforming the lives of communities by designing and implementing projects that works towards socio-economic upliftment of the communities. The efforts of the Company not only impact the development of the direct beneficiaries, but also attempt to enhance the quality of lives of those who are present in the ecosystem which drive positive change. At Indus, we believe that our business thrives on a strong and sustainable society and
therefore our commitments, focus on integrity, empathy and ethics shape the Indus value system.
On the recommendation of Corporate Social Responsibility (CSR) Committee, Board has approved the CSR Policy, which outlines the Companyâs CSR strategy to bring about a positive impact on society through various CSR Projects/Programs. Over the years, we have made valuable contributions by impacting lives of more than 3.7 million beneficiaries. Our CSR initiatives are aligned with sustainable development goals of India and are undertaken as per Schedule VII of the Companies Act.
Presently, the Key focus areas include:
⢠Promoting Quality Education for children and adults in rural and urban areas
⢠Digital literacy for children and adults in rural and urban areas
⢠Scholarship program for students with disability to pursue higher education of their choice
⢠Vocational skills training to youth belonging to marginalized communities
⢠Holistic development of abandoned children
⢠Providing infrastructural support in the area of sanitation
⢠Support government in the disaster relief and rehabilitation initiatives
Company-wide, Indus utilizes strengths and resources to benefit local communities. Individually, our employees through volunteering program actively engage in community service and contribute their time and resources to bring in positive change in community.
CSR programs at Indus are implemented by credible partners and are compliant to execute social development projects. These partners are selected on the basis of a robust due diligence process. All our projects are closely monitored and governed by the Board of Directors and the CSR Committee and managed by the CSR council members.
In accordance with the requirements of Section 135 of the Companies Act, 2013 and rules made thereunder, the Company has constituted CSR Committee. The composition and terms of reference of the CSR Committee is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
The Company has also formulated a Corporate Social Responsibility Policy, to ensure that the CSR programs of the Company reflect
its vision and values and is aligned with the applicable regulatory requirements. The CSR Policy is available at the website of the Company at https://www.industowers.com/wp-content/ uploads/2022/05/CSR-Policv.pdf. The details of the composition of CSR Committee, CSR projects, programmes and the Annual Action Plan are also available on the website of the Company.
During the year, the Company was required to spend H 573.03 Mn (2% of average net profits for the last 3 years) towards the CSR activities. Post adjustment of excess spent of H 154.79 Mn. in the previous financial year, the Board has approved h 418.24 Mn as CSR expenditure for financial year 2021-22 out of which the Company has spent H 356.29 Mn till March 31, 2022. The remaining amount of H 61.95 Mn towards the ongoing projects has been transferred to the unspent CSR Account of the Company in compliance with the requirement of Section 135(6) of the Companies Act, 2013.
As a socially responsible organisation, we harmonize our shortterm and long-term goals to consistently strive to serve society in a holistic manner to create a larger social impact. The Company is fully committed to the governmentâs vision of corporate social responsibility towards the society and is taking all the efforts for Indiaâs sustainable development by embedding wider economic, social and environmental objectives.
A detailed update on the CSR initiatives of the Company is provided in the Social Capital section, which forms part of this Integrated Report. The Annual Report on Corporate Social Responsibility u/s 135 of the Companies Act, 2013 is annexed as Annexure C to this Report.
SEBI vide circular dated February 6, 2017 has recommended voluntary adoption of Integrated Reporting by the top 500 listed companies in India. In line with its philosophy of being a highly transparent and responsible company and considering IR as a journey, the Company adopts âIntegrated Reportâ in accordance with the International Integrated Reporting Council (IIRC) framework.
The Integrated Report covers capital approach of IIRC Framework as well as the value that the Company creates for its stakeholders.
Business Responsibility and Sustainability Report
In accordance with the amended Regulation 34(2)(f) of Listing Regulations read with SEBI Circular no. SEBI/HO/CFD/CMD-2/P/CIR/2021/562 dated May 10, 2021, the Company has voluntary adopted Business Responsibility & Sustainability
Reporting (BRSR) for the financial year 2021-22, describing the initiatives taken by the Company from environmental, social and governance perspective. The said report forms part of this Integrated Report.
Management Discussion and Analysis Report
The Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 of the Listing Regulations, is presented in a separate section, forming part of this Integrated Report.
The Company is committed to benchmark itself with global standards and adopting best corporate governance practices. The Board constantly endeavors to take the business forward in such a way that it maximizes long term value for the stakeholders. The Company has put in place an effective corporate governance system which ensures that the provisions of Listing Regulations are duly complied with.
A detailed report on the corporate governance pursuant to the requirements of the Listing Regulations forms part of this Integrated Report.
A certificate from the Statutory Auditors of the Company, M/s Deloitte Haskins & Sells LLP, Chartered Accountants, confirming compliance of conditions of corporate governance as stipulated in Listing Regulations is annexed as Annexure D to this report.
Risk management is embedded in Indus Towersâ operating framework. The Company believes that risk resilience is key to achieving higher growth. To this effect, there is a robust process in place to identify key risks across the Company and prioritize relevant action plans to mitigate these risks. Risk Management framework is reviewed periodically by the Board and the Audit & Risk Management Committee, which includes discussing the management submissions on risks, prioritizing key risks and approving action plans to mitigate such risks.
The Company has duly approved a Risk Management Policy. The objective of this Policy is to have a well-defined approach to risk. The Policy lays down broad guidelines for timely identification, assessment and prioritization of risks affecting the Company in the short and foreseeable future. The Policy suggests framing an appropriate response for the key risks identified, so as to make sure that risks are adequately addressed or mitigated.
The Internal Audit function assists the Audit & Risk Management Committee on an independent basis with a review of the risk assessment and associated management action plans.
Operationally, risk is being managed at the top level by Management Committee, chaired by the Managing Director & Chief Executive Officer.
Detailed discussion on Risk Management forms part of Management Discussion & Analysis under the section âRisks and Concernsâ, which forms part of this Integrated Report. At present, in the opinion of the Board of Directors, there are no risks which may threaten the existence of the Company.
Internal Financial Controls and their adequacy
The Company has established a robust framework for internal financial controls. The Company has in place adequate controls, procedures and policies, ensuring orderly and efficient conduct of its business, including adherence to the Company policies, safeguarding its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information. During the year, such controls were assessed and no reportable material weaknesses in the design or operation were observed. Accordingly, the Board is of the opinion that the Companyâs internal financial controls were adequate and effective during the financial year 2021-22. The Internal financial controls of the Company have been further discussed in detail in the Management Discussion & Analysis section.
Code of Conduct/ Vigil Mechanism
The Code of Conduct and vigil mechanism of the Company is available on the website of the Company at www.industowers. com.
A brief note on the highlights of the Ombudsman Policy/ Whistleblower Policy and compliance with Code of Conduct is also provided in the Report on Corporate Governance which forms part of this Integrated Report.
We at Indus Towers believe that quality control acts as an important differentiator and driving force behind customer delight through achievement of high uptime and decreasing energy cost across our footprint.
We continue to fine tune our quality strategies in line with our expanding footprints with the aim of ensuring First Time Right.
The multi-pronged strategies are continually refined in line with changing field dynamics. The stage inspection of on-site work is undertaken by quality engineers for new build sites and major upgrades. Quality audits by independent agencies are undertaken on a regular basis to ensure additional controls. Preventive maintenance audits, process and design improvement and control ensures standardization and quality of workmanship.
We have continued with major project audits such as Electrical Hygiene Audits, Fire Solution Audits, Civil Audits, Refurbished Equipment Audits. Tower maintenance and Foundation strengthening audits to enhance the performance of sites from a long-term performance and safety perspective. As a unique exercise, we have been imparting product and process trainings to vendors/partners along with quality team on the field, thereby contributing to the organizationâs cause of delivering products at right time and at low price while maintaining the desired quality standards.
Quality also assures that products comply to specifications through pre-dispatch inspection of products.
Other Statutory Disclosures Related Party Transactions
A detailed note on procedure adopted by the Company in dealing with contracts and arrangements with Related Parties is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
All arrangements / transactions entered by the Company with its related parties during the year were in ordinary course of business and on an armâs length basis. Particulars of material transactions with related parties, under the provisions of the Companies Act, 2013, are given in form AOC- 2 as Annexure E to this report.
Names of related parties and details of transactions with them under Ind AS - 24 have been included in Note no. 39 of the standalone financial statements for the financial year ended March 31,2022 on Page no. 418.
The Policy on the Related Party Transactions is available on the website of the Company at https://www.industowers. com/wpcontent/themes/indus/pdf/Policy-on-Related-PartyTransactions.pdf.
Significant and material orders
There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and the Companyâs operations in future.
Material changes and commitments affecting financial position between the end of financial year and date of the report
There are no material changes and commitments affecting the financial position of the Company between the end of Financial Year and date of the report.
Particulars of loans, guarantees or investments
The details of loans given, investments made or guarantees given are provided in Note no. 6, 7 and 12 of the Standalone financial statements for the financial year ended March 31,2022.
Commercial Papers
During the year, the Company has raised H 34,000 Mn through issuance of Commercial Papers in various tranches. As on March 31, 2022, the Company has outstanding Commercial Papers amounting to H 9,000 Mn listed on National Stock Exchange of India Limited.
Particulars of Employees
Disclosures relating to remuneration of Directors u/s 197(12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure F to this report.
Particulars of employeesâ remuneration as required under Section 197(12) of the Act read with Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this report. However, in terms of the provisions of the first proviso to Section 136(1) of the Act, the Integrated Report is being sent to the shareholders excluding the aforementioned information. The information will be available on the Companyâs website at https://www. industowers.com/ and will also be available for inspection at the registered office of the Company on all working days (Monday to Friday) between 11.00 a.m. and 1.00 p.m. upto the date of AGM and a copy of the same will also be available electronically for inspection by the members during the AGM. Any member interested in obtaining such information may write to the Company Secretary at the Registered Office of the Company. up to the date of the ensuing Annual General Meeting. Any member interested in obtaining such particulars, may write to the Company Secretary at the registered office of the Company.
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo
The details of energy conservation, technology absorption and foreign exchange earnings and outgo as required under
Directorsâ Responsibility Statement
Pursuant to Section 134(5) of the Companies Act, 2013, the Directors to the best of their knowledge and belief confirm that:
I. In the preparation of the annual accounts for the year ended March 31,2022, the applicable accounting standards had been followed and there is no material departure from the same;
II. The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year ended March 31,2022, and of the profit of the Company for the year ended on that date;
III. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
IV. The Directors had prepared the annual accounts on a going 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 are operating effectively;
VI. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.
Acknowledgements
The Directors wish to place on record their appreciation for the assistance and co-operation extended by customers, strategic investors, bankers, vendors, business partners, various agencies and departments of Government of India and State governments where Companyâs operations are existing and look forward to their continued support in the future.
The Directors would also like to place on record their sincere appreciation for the valuable contribution, unstinted efforts and the spirit of dedication shown by the employees of the Company at all levels.
Section 134(3) of the Companies Act, 2013, read with the Rule 8 of Companies (Accounts) Rules, 2014 is annexed herewith as Annexure G to this report.
Disclosure under Section 197(14) of Companies Act, 2013
The Company does not have any holding company.
The Managing Director & CEO and the Chairman of the Company do not receive any remuneration or commission from the subsidiary company.
Annual Return
In terms of provisions of Section 92, 134(3)(a) of the Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules, 2014, the draft Annual Return having all the available information of the Company as on March 31, 2022, is available on the website of the Company at www.industowers.com.
Maintenance of Cost Records
The Company is not required to maintain cost records as specified under Section 148(1) of the Companies Act, 2013.
Prevention of Sexual Harassment at Workplace
The Company has an Internal Complaints Committee for providing a redressal mechanism pertaining to sexual harassment of employees at workplace. Details of the same including the details of the complaints received is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
Pursuant to the provisions of Section 118 of the Companies Act, 2013, the Company has complied with the applicable provisions of the Secretarial Standards issued by the Institute of Companies Secretaries of India and notified by Ministry of Corporate Affairs.
Mar 31, 2021
Your Directors are pleased to present the Fifteenth Boardâs Report on the business and operations of Indus Towers Limited (formerly Bharti Infratel Limited) (âthe Companyâ) together with the audited financial statements for the Financial Year ended March 31,2021.
Indus Towers is a provider of tower and related infrastructure sharing services. Following the amalgamation of erstwhile Indus Towers Limited with and into your Company during the year under review, we are one of the largest telecom tower companies in India basis the number of towers and co-locations operated by the Company. The business of Indus Towers is to deploy, own, operate and manage passive infrastructure pertaining to telecommunication operations. The Company provides access to its towers, primarily to wireless telecommunication service providers, on a shared basis under longterm contracts. Your Company has a nationwide presence with operations in all 22 telecommunication circles in India and caters to all wireless telecommunication service providers in India.
Post-merger, the combined strength and highly complementary footprints of both the Companies will enable your Company to offer high quality shared passive infrastructure services needed to support the pan-India expansion of wireless broadband services using 4G/4G /5G technologies for the benefit of Indian consumers and businesses.
As of March 31, 2021, Indus Towers owned and operated 179,225 towers with 322,438 co-locations in 22 telecommunication circles.
We have entered into Master Service Agreements (MSAs) with our customers. The MSAs are long-term contracts which set out the terms on which access is provided to the Companyâs towers, with all service providers being offered substantially the same terms and receiving equal treatment at towers where they have installed their active infrastructure. Under the MSAs, Indus Towers enters into service contracts in respect of individual towers. The MSAs and service contracts govern the Companyâs relationship with its customers, the services provided, the applicable charges and incorporate annual escalation clauses in respect of the applicable charges. This provides stability to our business and provides visibility with regard to future revenues.
As one of the largest telecom tower companies in India, it is imperative that Indus Towers combats the COVID-19 pandemic by
providing minimal disruption to the customers while maintaining and ensuring employee safety and well-being.
Our employees are working overtime to ensure that the vital connectivity is maintained at all times while enforcing social distancing and other safety protocols to contain the spread of the second wave of Corona Virus that we are all facing. 100% of our employees are able to seamlessly work from home and deliver service to all our customers. Our offices all over India have been operating with minimal or no staff. To effectively respond to and manage our operations through this crisis, the Company triggered and has followed its business continuity plan. This response has reinforced customer confidence on Indus Towers, and they have expressed their appreciation for keeping their businesses running under most challenging conditions.
The passive infrastructures as well as active telecom operations of the customers are actively engaged in fulfilling the surge in demand arising out of the evolution of India as a digital market. Technological change and industry disruption seem to be accelerating and digital information networks are linking individuals, organizations, and nations as never before. India continues to witness strong data growth trends with ~30% in Financial Year 21 over the last year.
The Company recovered from an adverse impact of the pandemic in the first quarter of Financial Year 21 to post three consecutive good quarters in terms of delivery of towers and co-locations. The Company shall calibrate its business depending upon the extent of the impact of the pandemic.
The financial statements of the Company have been prepared in accordance with the Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014.
A. Consolidated financial results as per Ind AS1
|
(H Millions) |
||
|
Particulars |
Year ended March 31,2021 |
Year ended March 31,2020 |
|
Revenue2 |
139,543 |
67,430 |
|
EBIDTA2 |
72,599 |
36,176 |
|
Profit before Tax |
47,569 |
37,875 |
|
Profit after Tax |
37,790 |
32,987 |
|
1 Basis Equity Method 2Revenue & EBITDA are excluding other income |
||
|
B. Standalone financial results as per Ind AS (H Millions) |
||
|
Particulars |
Year ended March 31,2021 |
Year ended March 31,2020 |
|
Revenue1 |
139,508 |
67,383 |
|
EBIDTA1 |
72,586 |
36,170 |
|
Profit before Tax |
43,160 |
24,122 |
|
Profit after Tax |
33,382 |
17,466 |
|
1Revenue & EBITDA are excluding other income |
||
The results for the current financial year include the results of erstwhile Indus Towers Limited which merged with and into the Company w.e.f. November 19, 2020 for the period subsequent to that date till the end of the Financial Year (Refer Note 3 to the Standalone/Consolidated Financial Statements for further details). Accordingly, the figures for the current Financial Year ended March 31, 2021 are not comparable with the figures of the previous Financial Year ending March 31,2020.
Share Capital
Pursuant to the effectiveness of Scheme of amalgamation, the authorized share capital of the Company has been increased from H 35,000,000,000 divided into 3,500,000,000 equity shares of H 10/- (H Ten) each to H 35,500,000,000 divided into 3,550,000,000 equity shares of H 10/- (H Ten) each.
During the year under review, the Company had issued 845,328,704 equity shares of face value of H 10/- each pursuant to amalgamation of erstwhile Indus Towers Limited with and into the Company in accordance with the provisions of Companies Act, 2013 (Act) and SEBI Regulations. Consequent to the above, the issued, subscribed and paid-up equity share capital of the Company as on March 31,2021, is H26,949,369,500 divided into 2,694,936,950 Equity Shares of H 10/- each fully paid-up.
Transfer to Reserves
The Company has not transferred any amount to the General Reserve for the Financial Year ended March 31,2021.
Dividend
The Board, on July 27, 2020, had declared the 1st interim dividend of H 2.30/- per equity share of H 10/- each fully paid up (23% of face value) for Financial Year 2020-21 amounting to H 4,254 Mn. On January 28, 2021, the Board declared the 2nd interim dividend of H 17.82/- per equity share of H 10/- each fully paid up (178.2% of face value) for Financial Year 2020-21 amounting to H 48,023 Mn,
thereby resulting in a total dividend of H 20.12/- per equity share of H 10/- each fully paid up (201.2% of face value) for the Financial Year 2020-2021 amounting to H 52,277 Mn.
Dividend Distribution Policy
As per Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âthe Listing Regulationsâ), top 500 listed companies based on the market capitalization shall formulate a dividend distribution policy. Accordingly, the policy was adopted by the Board of Directors of the Company to set out the parameters and circumstances that will be taken into account by the Board in determining the distribution of dividend to its shareholders and / or retaining profits earned by the Company. The Dividend Distribution Policy is available on the website of the Company at https://www. industowers.com/wp-content/themes/indus/pdf/policy/Dividend-Policy.pdf and is annexed as Annexure A to this report.
Post-merger, CRISIL Limited and ICRA Limited migrated its ratings of erstwhile Indus Towers Limited to the Company. As on the date of this report, CRISIL Limited rated their Long-Term Rating to CRISIL AA / Stable, Short-term rating to CRISIL A1 (Reaffirmed) and Bond rating to CRISIL AA / Stable. It also reaffirmed the Commercial Papers Rating to CRISIL A1 assigned to the Company. Further, ICRA Limited rated the Non-Convertible Debentures rating to [ICRA] AA (Stable), Term Loans rating to [ICRA] AA (Stable), Fund based/ Non-fund based rating to [ICRA] AA (Stable) and rating of unallocated limits to [ICRA] AA (Stable)/ A1 . It also reaffirmed the Commercial Papers Rating to [ICRA] A1 and issuer rating to [ICRA] AA (Stable) assigned to the Company.
Transfer of amount to Investor Education and Protection Fund
Pursuant to the provisions of Section 124 of the Act, during the Financial Year 2020-21, the Company has transferred an amount of H 235,542 (Rupees Two Lakh Thirty Five Thousand Five Hundred Forty Two Only) pertaining to final dividend on equity shares for Financial Year 2012-13, lying in âUnpaid Equity Dividend 2013â, which remained unpaid/ unclaimed for a period of seven years, to Investor Education and Protection Fund (IEPF) established by the Central Government.
Further, 840 equity shares of the Company on which the dividend remained unpaid/ unclaimed for a period of seven consecutive years were also transferred to IEPF in accordance with the Act and rules thereunder after giving due notice to the concerned shareholders.
The investors whose shares and dividend amount have been transferred to IEPF may claim their shares and seek refund in
accordance with the provisions of law. The details regarding the above along with the process for claiming the unpaid dividend / shares is available on the website of the Company at https://www. industowers.com/investor/shares/.
The Company has also uploaded the details of unpaid and unclaimed dividend amounts lying with the Company as on August 3, 2020 (date of last Annual General Meeting) on the website of the Company at www.industowers.com.
In accordance with the provisions of Rule (2A) of Rule 7 of Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, Ms. Samridhi Rodhe has been appointed as the Nodal Officer of the Company. The details are available on the Companyâs website at www.industowers.com.
The Company has not accepted any fixed deposit and as such no amount of principal or interest was outstanding as on the date of balance sheet.
Amalgamation of erstwhile Indus Towers Limited with and into the Company w.e.f. November 19, 2020
On April 24, 2018, the Board had approved a Scheme of arrangement and amalgamation between the Company and erstwhile Indus Towers Limited which provided for amalgamation of erstwhile Indus Towers Limited with and into the Company on a going concern basis, subject to all necessary approvals.
The Scheme had received all regulatory approvals. The Honâble National Company Law Tribunal, Chandigarh Bench approved the Scheme vide its order dated May 31,2019 read with its order dated October 22, 2020. Upon completion of other actions/ conditions precedent for the Scheme to become effective and extension of time allowed by the Honâble NCLT, the Scheme became effective on November 19, 2020 upon filing of the certified copy of NCLT order with the Registrar of Companies.
Upon implementation of the Scheme and allotment of shares, in compliance with the provisions of the Companies Act, 2013 and Listing Regulations, and in accordance with the restated Articles of the Company, Vodafone Group (through its subsidiaries) also became promoter of your Company with 28.12% shareholding. The shareholding of Bharti Airtel Group,
existing promoters of the Company was reduced from 53.51% to 36.73%, and consequently, the Company ceased to be a subsidiary of Bharti Airtel Limited. 35.15% Shares were held by public shareholders. Subsequently, Bharti Airtel Group acquired additional ~5% shares in the Company.
Through detailed planning on integration, your Company ensured nil disruption âday 0â and has been functioning as a unified Company from day 1 towards its customers, employees, and business partners. The processes, policies and system integration are underway. Even in this unprecedented time, your Company is progressing well as per the plan and timeliness to ensure common ways of working for all in the Company.
Change in name of the Company
The Scheme of arrangement and amalgamation between erstwhile Indus Towers and the Company provided that upon effectiveness of the Scheme, the name of the Company i.e. Bharti Infratel Limited will be changed to âIndus Towers Limitedâ.
Upon compliance with all statutory provisions, filings and thereafter issuance of certificate of name change by the Registrar of Companies, the name of your Company changed to âIndus Towers Limitedâ w.e.f. December 10, 2020.
Directors and Key Managerial Personnel
Induction, Re-appointment and Resignation
During the year, the shareholders have approved the re-appointment of Mr. Devender Singh Rawat as Managing Director & CEO (DIN: 06798626) w.e.f. April 1, 2020 up till the date of last AGM i.e. August 3, 2020. Mr. Rawat resigned from the Board w.e.f. aforesaid date.
Mr. Bimal Dayal (DIN: 08927887) was appointed as Managing Director of the Company w.e.f. October 22, 2020 till the effective date of merger i.e. November 19, 2020.
Upon effectiveness of the merger, the Board of the Company was reconstituted in accordance with the restated Articles of the Company w.e.f. conclusion of the Board meeting held on November 19, 2020.
Mr. Balesh Sharma (DIN: 07783637), Mr. Gopal Vittal (DIN: 02291778), Mr. Harjeet Singh Kohli (DIN: 07575784), Mr. Randeep Singh Sekhon (DIN: 08306391), Mr. Ravinder Takkar (DIN: 01719511), and Mr. Thomas Reisten (DIN: 06900067) were appointed on the Board as additional directors in the category of Non-Executive Non-Independent directors. Being eligible, it is proposed to appoint them as directors of the Company, liable to retire by rotation, in the ensuing AGM.
Subject to shareholders approval, Mr. Sharad Bhansali (DIN: 08964527) and Ms. Sonu Bhasin (DIN: 02872234) were appointed as Non-Executive Independent Directors, not liable to retire by rotation, w.e.f. the conclusion of the Board meeting held on November 19, 2020 for a term of 5 (Five) years.
In the opinion of the Board, they possess requisite qualifications, experience, expertise, proficiency and hold high standards of integrity.
Mr. Akhil Kumar Gupta (DIN: 00028728), Mr. Bharat Sumant Raut (DIN: 00066080), Mr. Bimal Dayal (DIN: 08927887), Mr. Jitender Balakrishnan (DIN: 00028320), Dr. Leena Srivastava (DIN: 00005737), Mr. Rajinder Pal Singh (DIN: 02943155) and Mr. Tao Yih Arthur Lang (DIN: 07798156) resigned from the Board w.e.f. the conclusion of the Board meeting held on November 19, 2020.
Mr. Narayanan Kumar (DIN: 00007848) was appointed as the initial Chairman of the Board w.e.f. conclusion of the Board meeting held on November 19, 2020.
Mr. Bimal Dayal (DIN: 08927887) was appointed as Chief Executive Officer of the Company w.e.f. November 19, 2020 and the Board had recommended to the shareholders, his appointment as Managing Director & CEO of the Company for a period of 5 years commencing from the date of approval of the shareholders. The Shareholders of the Company approved his appointment as Managing Director & CEO on January 8, 2021 through postal ballot.
Pursuant to the provisions of the Companies Act, 2013, Mr. Rajan Bharti Mittal (DIN: 00028016), Non-Executive Non-Independent Director of the Company will retire by rotation at the ensuing AGM and being eligible, has offered himself for re-appointment. The Board recommends his re-appointment as Director at the ensuing AGM.
Ms. Pooja Jain was appointed as Chief Financial Officer w.e.f. June 4, 2020. Upon effectiveness of merger, she has resigned w.e.f. the close of business hours on November 30, 2020. Mr. Manish Dawar was appointed as Chief Financial Officer of the Company w.e.f. December 1, 2020, however, he could not join due to unavoidable reasons. Mr. Vikas Poddar was appointed as Chief Financial Officer of the Company w.e.f. January 12, 2021.
The Board placed on record its sincere appreciation for the guidance and contribution made by the outgoing directors during their tenure on the Board. The Board acknowledged the phenomenal contribution made by Mr. Akhil Gupta, Chairman towards the growth of the Company since inception. The Board also appreciated the contribution made by Ms. Pooja Jain during her tenure.
Declaration by Independent Directors
The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of
independence as prescribed under Section 149 of the Companies Act, 2013 and Regulation 16 & 25 of the Listing Regulations. The Independent Directors have also confirmed that they have complied with the Companyâs code of conduct.
Policy on Nomination, Remuneration and Board Diversity
The Company believes that building a diverse and inclusive culture is integral to its success. A diverse Board will be able to leverage different skills, qualifications, professional experiences, perspectives and backgrounds, which is necessary for achieving sustainable and balanced development. The Board has adopted a Policy on Nomination, Remuneration and Board Diversity, which sets out the criteria for determining qualifications, positive attributes and independence of a director. The detailed policy is available on the website of the Company at https://www.industowers.com/wp-content/themes/indus/pdf/Policy-on-Nomination-Remuneration-and-Board-Diversitv.pdf and is annexed as Annexure B to this report.
Annual Board Evaluation and Familiarisation Programme for Board Members
The Company has adopted a structured induction programme for orientation and training of Directors at the time of their joining. A note on the familiarisation programme is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
The HR, Nomination and Remuneration Committee, has put in place a robust framework for evaluation of the Board, Board Committees and Individual Directors including the Independent Directors, Chairman and MD & CEO. Customized questionnaires were circulated, responses were analysed, and the results were subsequently discussed by the Board. Recommendations arising from the Evaluation process were duly considered by the Board to further augment its effectiveness. The Board further noted that the Board and the Committees have been reconstituted recently. A detailed update on the Board Evaluation is provided in the report on Corporate Governance which forms part of this Integrated Report.
During the Financial Year 2020-21, the Board of Directors met 10 times i.e. on April 23, 2020; June 3, 2020; June 24, 2020; July 27, 2020; August 31,2020; October 22, 2020; November 19, 2020; November 20, 2020; January 12, 2021 and January 28, 2021. The period between any two consecutive meetings of the Board of Directors of the Company was not more than 120 days.
The details regarding composition, number of Board meetings held and attendance of the Directors during the Financial Year 2020-21 are set out in the Report on Corporate Governance which forms part of this Integrated Report.
The Company has several Board Committees which have been established as part of the best corporate governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes. As on March 31, 2021, the Board has 4 Committees, namely, Audit & Risk Management Committee; HR, Nomination and Remuneration Committee; Corporate Social Responsibility (CSR) Committee and Stakeholdersâ Relationship Committee. The Committee of Directors (COD) was dissolved w.e.f. November 19, 2020. The details with respect to the composition, powers, roles, terms of reference, number of meetings held etc. of the Committees during the Financial Year 2020-21 and attendance of the members at each Committee meeting is provided in the Report on Corporate Governance which forms part of this Integrated Report.
All the recommendations made by the Committees of the Board including the Audit & Risk Management Committee were accepted by the Board.
Subsidiary/ Joint Venture/ Associate Company
As on March 31,2021, the Company has a wholly owned subsidiary named Smartx Services Limited. The joint venture company i.e. erstwhile Indus Towers Limited had merged with the Company w.e.f. November 19, 2020 thereby resulting in dissolution of erstwhile Indus Towers Limited without any winding up proceeding.
In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements of the Company and its subsidiary, which forms part of this Integrated Report. A statement in Form AOC- 1, containing the salient features of the financial statements of the subsidiary company is annexed as Annexure C to this report. The statement also provides the details of performance and financial position of the subsidiary company.
Audited financial statements of Smartx Services Limited for the Financial Year 2020-21 have been placed on the website of the Company at www.industowers.com. The audited financial statements of the subsidiary company is available for inspection at the Companyâs registered office and registered office of the subsidiary company. Shareholders interested in obtaining a copy of the audited financial statements of subsidiary company may write to the Company Secretary at the Companyâs registered office.
The Company does not have any joint venture company or an associate company as on March 31,2021.
At Indus Towers, we believe that our people are key to the success of our business. While we boast of having telecom industryâs best
talent in the Company, our aim is to sustain our fervor as an employer of choice for prospective employees and provide an enriching career to them. We enabled the nation to remain connected even amidst adversities and the challenges posed by the recent COVID-19 pandemic. It is the commitment and dedication of our employees that help us to address challenges and remain motivated to overcome every obstacle on our way. Our human capital has, therefore, played a pivotal role in shaping Indus Towers into what we are today.
Indus Towers has been named as one of The Gallupâs Exceptional Workplace. This is a testament to our vision of transforming lives by enabling communication. Indus Towers has led the way and demonstrated how putting people front and center of their organizational initiatives can lead to achieving higher levels of business performance. For a young organization like Indus Towers, which operates in the B2B space, defining and percolating an organization wide culture and becoming an employer of choice are two important and interrelated aspects. During our journey, we have realized that the first step in creating an employer brand is to define and articulate the culture which proves to be a differentiating factor for external and internal employees.
Connecting and engaging with nearly 3,442 employees spread across our 22 circles has become possible through our constant communication especially in the third quarter. Communication on changes within the organization on account of merger to revised employee-related policies, from wellbeing initiatives to quizzes and workshops, it has been instrumental in keeping morale of the employees high while ensuring their engagement at the same time.
At Indus Towers, we believe in embracing technology and use it to our advantage to make processes simpler and more efficient. Our shift to the acclaimed Oracle Recruiting cloud has enabled us to digitize the recruitment process completely.
Demographic and technological shifts have made it even more important for people to remain âfit for the futureâ, both as professionals and as individuals. We constantly organize various learning and development initiatives for our employees. Due to the pandemic, adapting to new methods of working emerged as the need of the hour. During the year under review, we migrated from classroom learning to a technology driven approach, through a virtual platform -Oracle Learning Cloud (OLC). We continued partnership with Lynda - LinkedIn Learning last year. Through such digital learning platform, employees are able to access world class content on the go. During the year under review, we introduced various new courses such as Mod 0 in 8 regional languages, 25 Ready Behavioural Courses and more than 15 Technical Webinars, creating a repository of more than 100 online modules of Behavioural and Functional/ Technical training. To ensure employee safety at workplace, every
new employee is required to undergo mandatory safety training and existing employees have to undergo annual refresher training. As part of our commitment towards holistic development, employees are continuously being encouraged to go for external certifications and MDP programs from elite institutions like ISB, IIMs, etc.
At Indus Towers, employee well-being and safety have always been a priority. In order to ease anxiety and offer support during the pandemic, we planned various initiatives to ensure the safety of our employees and their family members. A cross functional leadership team (CSC- COVID-19 Steering Committee) was formed and spearheaded by the MD & CEO. Additional health insurance for COVID-19 was offered to employees and the Company continuously monitored and tracked COVID-19 cases on a daily basis to provide adequate support of the Company. PPE kits were provided and travel passes were arranged for field employees to ease their movement and ensure their safety.
Diversity and Inclusion is at the heart of Indus, over the years we have been constantly working on strengthening our policies and processes to provide a safe, equal and inclusive work environment for all.
We have been successful in onboarding talent not only for office-based roles but also in the field. Despite being an engineering and hardcore technical organization, where availability of diverse talent is limited, share of women in our total employee population is 6.4% and we are determined to improve this year on year. With focused efforts on hiring viz. minimum 30% of all CVs shared for a role to be women candidates, extra mark up to search partners for closing a position with diversity candidates and special building a pipeline through internal referrals, we are sure to improve our overall diversity number in the years to come.
Continuing our efforts to ensure a conducive and safe environment for women employees, we have a mandatory training on POSH added to our online learning module, which needs to be completed by all employees within a month of joining. We also have a neutral Internal Complaints Committee which investigates and takes appropriate action on any concerns related to harassment raised by employees. Apart from this, many engagement initiatives are planned and calendarized for D&I. This year, our MD & CEO Mr. Bimal Dayal, launched the I-WIN network on Womenâs day, which is a Pan Indus womenâs network focused on networking, learning and growing. This was followed by a week-long celebration of Embracing Diversity, focused at holistic well-being of our employees. The week included virtual sessions on physical, legal and financial well-being of women, self-defense, contests and quizzes and an open house with leadership.
To retain, promote and motivate the best talent in the Company and to develop a sense of ownership among employees, the Company has instituted two ESOP schemes i.e. Employee Stock Option Scheme 2008 (ESOP Scheme 2008) and Employee Stock Option Scheme 2014 (ESOP Scheme 2014) with the approval of shareholders. The said schemes are in compliance with the SEBI (Share Based Employee Benefits) Regulation, 2014, (ESOP Regulations). The HR, Nomination and Remuneration Committee monitors the Companyâs ESOP schemes. The Company will continue with the existing Scheme post effectiveness of merger.
In accordance with the ESOP Regulations, the Company had set up Indus Towers Employeesâ Welfare Trust (formerly Bharti Infratel Employeesâ Welfare Trust) (ESOP Trust) for the purpose of implementation of ESOP Schemes. Consequent to the change in name of the Company, the name of the Trust was changed to Indus Towers Employeesâ Welfare Trust. Both the ESOP schemes are administered through ESOP Trust, whereby shares held by the ESOP Trust are transferred to the employees, upon exercise of stock options as per the terms of the Scheme. In terms of ESOP Regulations, neither the ESOP Trust nor any of its trustees shall exercise voting rights in respect of the shares of the Company held by the ESOP Trust.
During the Financial Year 2020-21, Company has granted 490,785 stock options under the ESOP Scheme 2014. A detailed report with respect to options exercised, vested, lapsed, exercise price, vesting period etc. under ESOP Scheme 2008 and ESOP Scheme 2014 is disclosed on the website of the Company at https://www. industowers.com/investor/shares/.
A certificate from M/s Deloitte Haskins & Sells LLP, Chartered Accountants, Statutory Auditors, with respect to ESOP Scheme 2008 and ESOP Scheme 2014 would be placed before the shareholders at the ensuing AGM and a copy of the same will also be available for inspection at the registered office of the Company.
Auditors and Auditorsâ Report
Statutory Auditors & their Report
In terms of the provisions of Section 139 of the Companies Act, 2013, M/s Deloitte Haskins & Sells LLP, Chartered Accountants, (firm registration number 117366W-W100018) (âDeloitteâ) were appointed as the Statutory Auditors of the Company by the shareholders in the 11th AGM of the Company held on July 22, 2017, for a period of five years i.e. up to 16th AGM of the Company.
The Board has duly examined the Statutory Auditorâs Report on the Standalone and Consolidated Financial Statements of the Company for the Financial Year ended March 31, 2021 which is self-explanatory. The report does not contain any observations, disclaimer, qualification or adverse remarks.
Further, no fraud has been reported by the Statutory Auditors in terms of Section 143(12) of the Companies Act, 2013 during the year.
Secretarial Auditors & their Report
The Company had appointed M/s. Chandrasekaran Associates, Company Secretaries, New Delhi, to conduct its Secretarial Audit for the Financial Year ended March 31, 2021. The Secretarial Auditors have submitted their report, confirming compliance by the Company of all the provisions of applicable corporate laws. The Report does not contain any qualification, observation, disclaimer or adverse remark. The Secretarial Audit Report for the Financial Year 2020-21 is annexed as Annexure D to this report.
The Board has re-appointed M/s. Chandrasekaran Associates, Company Secretaries, New Delhi, as Secretarial Auditors of the Company for the Financial Year 2021-22.
Internal Auditor and Internal Assurance Partner
The Company has in place a robust Internal Audit team which is headed by the Internal Auditor and ably supported by reputed independent firms.
Up till the effectiveness of merger, Mr. Sudeep Chopra was the Internal Auditor of the Company and M/s. Ernst & Young LLP were the Internal Assurance Partners to conduct the internal audit. Upon effectiveness of merger, Mr. Sarabhjit Singh was appointed as the Internal Auditor of the Company and PricewaterhouseCoopers Private Limited (PwC) and ANB Solutions Private Limited (ANB) were engaged as the Internal Assurance Partners for the remainder term of the year.
The audit conducted by the Chief Internal Auditor and Internal Assurance Partners is based on an internal audit plan, which is reviewed each year in consultation with the Audit & Risk Management Committee. As per the report of Internal Auditor, the policies, processes, and internal controls in the Company are generally adhered to, while conducting the business.
The Board, on the recommendation of the Audit & Risk Management Committee, has re-appointed PwC and ANB as the Internal Assurance Partners for the Financial Year 2021-22.
Corporate Social Responsibility (CSR)
The CSR vision of Indus Towers aims at taking active role and responsibility in transforming the lives of communities through longterm value creation for all stakeholders by improving their socioeconomic status. Indus believes in sustainable development and growing business in a socially and environmentally responsible way. As an important participant of the society, Indus along with all its employees believe to be committed to create positive social change through base-level intervention and volunteering. Being an industry leader, Indus believes that this position brings great responsibility and commitment towards society.
Over the years, we have undertaken various CSR initiatives linked to sustainable development goals to bring the bottom-up community transformation and their overall structural change. Currently, our CSR focus areas include:
Quality Education both formal and informal for children from rural areas
Digital literacy for children and adults in rural and urban areas
Scholarship program for underprivileged children to pursue higher education.
Scholarship program for people with disability to pursue higher education of their choice.
Vocational skills training to youth belonging to marginalized communities.
Livelihood promotion through sustainable energy.
Contributing to food, hunger and nutrition needs of children. Education and rehabilitation of abandoned children.
Support government in disaster relief and rehabilitation initiatives.
Supporting other need-based initiatives.
In addition to the above, Indus employees through volunteering program actively engage in community service and contribute their time and resources to bring in positive change in community and wherever possible fill in the social gaps.
Our CSR project beneficiaries are part of our larger family of stakeholders. Drawing from the vision and mission statement of the Company through CSR, Indus proactively engages with the society and have made positive changes to their lives which are very encouraging and successful to the core. The initiatives in education, rural development, institutional strengthening, skill development and sanitation forms the
Our work towards social development through CSR encompasses much more than just social outreach programmes. We also maintain and align our business processes and goals to make it more prosperous, equitable and self-sufficient.
In accordance with the requirements of Section 135 of the Companies Act, 2013 and rules made thereunder, the Company has constituted CSR Committee. The composition and terms of reference of the CSR Committee is provided in the Report on Corporate Governance, which forms part of this Integrated Report. The Company has also formulated a Corporate Social Responsibility Policy, to ensure that the CSR programs of the Company reflect its vision and values and is aligned with the applicable regulatory requirements. The details of the Composition of CSR Committee, CSR projects and programmes and the CSR Policy of the Company is available on the website of the Company at https://www. industowers.com/wp-content/themes/indus/pdf/CSR-Policy.pdf .
During the year, the Company has spent H 706.40 Mn (2.11% of the net profit) on the CSR activities. As a socially responsible organisation, we harmonize our short-term and long-term goals to consistently strive to serve society in a holistic manner to create a larger social impact. The Company is fully committed to the governmentâs vision of corporate social responsibility towards the society and is taking all the efforts for Indiaâs sustainable development by embedding wider economic, social and environmental objectives.
A detailed update on the CSR initiatives of the Company is provided in the social capital section, which forms part of this Integrated Report. The Annual Report on Corporate Social Responsibility u/s 135 of the Companies Act, 2013 is annexed as Annexure E to this Report.
SEBI vide circular dated February 6, 2017 has recommended voluntary adoption of Integrated Reporting by the top 500 listed companies in India. In line with its philosophy of being a highly transparent and responsible company and considering IR as a journey, the Company adopts âIntegrated Reportâ in accordance with the International Integrated Reporting Council (IIRC) framework. The Integrated Report covers capital approach of IIRC Framework as well as the value that the Company creates for its stakeholders.
Business Responsibility Report
As stipulated under the Listing Regulations, the Business Responsibility Report, describing the initiatives taken by the Company from environmental, social and governance perspective
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Management Discussion and Analysis Report
The Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 of the Listing Regulations, is presented in a separate section, forming part of this Integrated Report.
The Company is committed to benchmark itself with global standards for providing good corporate governance. The Board constantly endeavors to take the business forward in such a way that it maximizes long term value for the stakeholders. The Company has put in place an effective corporate governance system which ensures that the provisions of Listing Regulations are duly complied with.
A detailed report on the corporate governance pursuant to the requirements of the Listing Regulations forms part of this Integrated Report.
A certificate from the auditors of the Company, M/s Deloitte Haskins & Sells LLP, Chartered Accountants, confirming compliance of conditions of corporate governance as stipulated in Listing Regulations is annexed as Annexure F to this report.
Risk management is embedded in Indus Towersâ operating framework. The Company believes that risk resilience is key to achieving higher growth. To this effect, there is a robust process in place to identify key risks across the Company and prioritize relevant action plans to mitigate these risks. Risk Management framework is reviewed periodically by the Board and the Audit & Risk Management Committee, which includes discussing the management submissions on risks, prioritizing key risks and approving action plans to mitigate such risks.
The Company has duly approved a Risk Management Policy. The objective of this Policy is to have a well-defined approach to risk. The Policy lays down broad guidelines for timely identification, assessment and prioritization of risks affecting the Company in the short and foreseeable future. The Policy suggests framing an appropriate response for the key risks identified, so as to make sure that risks are adequately addressed or mitigated.
The Internal Audit function assists the Audit & Risk Management Committee on an independent basis with a review of the risk assessment and associated management action plans.
Operationally, risk is being managed at the top level by Management Committee, chaired by the Managing Director & Chief Executive Officer
Detailed discussion on Risk Management forms part of Management Discussion & Analysis under the section âRisks and Concernsâ, which forms part of this Integrated Report. At present, in the opinion of the Board of Directors, there are no risks which may threaten the existence of the Company.
Internal Financial Control and their adequacy
The Company has established a robust framework for internal financial controls. The Company has in place adequate controls, procedures and policies, ensuring orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information. During the year, such controls were assessed and no reportable material weaknesses in the design or operation were observed. Accordingly, the Board is of the opinion that the Companyâs internal financial controls were adequate and effective during the Financial Year 2020-21. The Internal financial controls of the Company have been further discussed in detail in the Management Discussion & Analysis section.
Code of Conduct/ Vigil Mechanism
The Code of Conduct and vigil mechanism of the Company is available on the website of the Company at www.industowers.com.
A brief note on the highlights of the Ombudsman Policy/ Whistleblower Policy and compliance with Code of Conduct is also provided in the Report on Corporate Governance which forms part of this Integrated Report.
We, at Indus Towers, believe that Quality Control acts as an important differentiator and driving force behind customer delight through achievement of high uptime and decreasing energy cost across our footprint.
We continue to fine tune our Quality strategies in line with our aim of ensuring First Time Right and site safety. The multi-pronged strategies have been refined in line with changing field scenarios. We continue to undertake pre-dispatch inspection of all major and minor material. The stage inspection of on-site work is undertaken by quality engineers for 100% of all new build sites and upgrades. Quality Audits by independent agencies on a regular basis ensures additional controls. Preventive maintenance Audits, Process and Design improvement and Control ensure standardization and quality
of workmanship. As a regular practice, we have been aggressively carrying out tower maintenance.
We have continued major projects such as Tower maintenance, Foundation strengthening, creation of As-built site drawings and integration of site data on a central platform âOne Viewâ. Our efforts are always towards zero fire exercise; for ensuring the same, we have enabled teams with thermal scanners and have been carrying out regular audits of each site to ensure site quality control measures are in place. As a unique exercise, we have been imparting product and process trainings to vendor/partners along with quality team on the field, thereby contributing to the organizationâs cause of delivering products at right time and at low price while maintaining the desired quality standards.
The referred activities have transformed the output and resulted in one of the highest qualities KPI achievement during the past year.
With constant endeavor towards timely pre-dispatch inspection (PDI), Site quality inspections and site corrections, we were able to roll out highest ever new nominals.
Our assistance towards asset re-use post refurbishment and inspection towards improving Asset utilization, Conversion of indoor sites to outdoor for energy costs reduction, electrification of unelectrified sites and energy metering validations continued unbated. This has helped us in our continuous strive towards higher utilization and lower costs, lower energy consumption, lower network outages and improved P&L for operators and us.
Related Party Transactions
A detailed note on procedure adopted by the Company in dealing with contracts and arrangements with Related Parties is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
All arrangements / transactions entered by the Company with its Related Parties during the year were in ordinary course of business and on an armâs length basis. Particulars of material transactions with related parties, under the provisions of the Companies Act, 2013, are given in form AOC- 2 as Annexure G to this report.
Names of Related Parties and details of transactions with them under Ind AS - 24 have been included in Note no. 41 of the standalone financial statements for the Financial Year ended March 31, 2021 on page 331.
The Policy on the Related Party Transactions is available on the website of the Company at https://www.industowers.com/wp-content/themes/indus/pdf/Policy-on-Related-Party Transactions.pdf.
Significant and material orders
There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and the Companyâs operations in future other than the orders passed by Honâble Tribunal, disclosed in the significant developments section of this report.
Material changes and commitments affecting financial position between the end of Financial Year and date of the report
There are no material changes and commitments affecting the financial position of the Company between the end of Financial Year and date of the report.
Particulars of loans, guarantees or investments
The details of loans given, investments made or guarantees given are provided in Note no. 6, 7, 8 and 14 of the Standalone financial statements for the year ended March 31,2021.
Commercial Papers
During the year, the Company has raised funds through issuance of Commercial Papers in various tranches. As on the date of this report, the Company has outstanding Commercial Papers amounting to H 17,700 Mn listed on National Stock Exchange of India Ltd.
Particulars of Employees
Disclosures relating to remuneration of Directors u/s 197(12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure H to this report.
Particulars of employee remuneration as required under Section 197(12) of the Act read with Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this report. However, in terms of the provisions of the first proviso to Section 136(1) of the Act, the Integrated Report is being sent to the shareholders excluding the aforementioned information. The said information is available for inspection by the members at the registered office of the Company up to the date of the ensuing Annual General Meeting. Any member interested in obtaining such particulars, may write to the Company Secretary at the registered office of the Company.
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo
The details of energy conservation, technology absorption and foreign exchange earnings and outgo as required under Section 134(3) of the Companies Act, 2013, read with the Rule 8 of Companies (Accounts) Rules, 2014 is annexed herewith as Annexure I to this report.
Disclosure under Section 197(14) of Companies Act, 2013
Following the merger of erstwhile Indus Towers Limited with and into the Company, w.e.f. November 19, 2020 the Company does not have any holding company. The Managing Director & CEO and the Chairman of the Company do not receive any remuneration or commission from the subsidiary company.
Annual Return
In terms of provisions of Section 92, 134(3)(a) of the Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules, 2014, the draft Annual Return having all the available information of the Company as on March 31, 2021, is available on the website of the Company at www.industowers.com.
Maintenance of Cost Records
The Company is not required to maintain cost records as specified under Section 148(1) of the Companies Act, 2013.
Sexual Harassment of Women at Workplace
The Company has an Internal Complaints Committee for providing a redressal mechanism pertaining to sexual harassment of women employees at workplace. Details of the same including the details of the complaints received is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
Pursuant to the provisions of Section 118 of the Companies Act, 2013, the Company has complied with the applicable provisions of the Secretarial Standards issued by the Institute of Company Secretaries of India and notified by Ministry of Corporate Affairs.
Directorsâ Responsibility Statement
Pursuant to Section 134(5) of the Companies Act, 2013, the Directors to the best of their knowledge and belief confirm that:
I. In the preparation of the annual accounts for the year ended March 31,2021, the applicable accounting standards had been followed and there is no material departure from the same;
II. The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year ended March 31, 2021 and of the profit of the Company for the year ended on that date;
III. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
IV. The Directors had prepared the annual accounts on a going 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 are operating effectively;
VI. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.
The Directors wish to place on record their appreciation for the assistance and co-operation extended by customers, strategic investors, bankers, vendors, business partners, various agencies and departments of Government of India and State governments where Companyâs operations are existing and look forward to their continued support in the future.
The Directors would also like to place on record their sincere appreciation for the valuable contribution, unstinted efforts and the spirit of dedication shown by the employees of the Company at all levels.
For and on behalf of the Board of Directors of Indus Towers Limited (formerly Bharti Infratel Limited)
N Kumar Bimal Dayal
Date: April 22, 2021 Chairman Managing Director & CEO
Place: Gurugram DIN: 00007848 DIN: 08927887
Mar 31, 2019
Dear Members,
Your Directors are pleased to present the Thirteenth Boardâs Report on the business and operations of the Company together with the audited financial statements for the financial year ended March. 31, 2019.
Business Overview
Bharti Infratel is a provider of tower and related infrastructure sharing services. On a consolidated basis, we are one of the largest pan-India tower infrastructure providers, based on the number of towers owned and operated by Bharti Infratel and Indus Towers, which are represented by Bharti Infratelâs 42% equity interest in Indus Towers. The business of Bharti Infratel and Indus Towers is to acquire, build, own and operate towers and related infrastructure. Bharti Infratel and Indus Towers provide access to their towers primarily to wireless telecommunication service providers on a shared basis under long-term contracts. We cater to all wireless telecommunication service providers in India.
We have a nationwide presence with operations in all 22 telecommunication circles in India, with Bharti Infratel and Indus Towers having operations in 4 overlapping circles.
As of March. 31, 2019, Bharti Infratel owned and operated 40,388 towers witRs. 76,341 co-locations in 11 telecommunication circles while Indus Towers operated 1,23,546 towers witRs. 229,483 colocations in 15 telecommunication circles. With Bharti Infratelâs towers and its 42% interest in Indus Towers, we have an economic interest in the equivalent of 92,277 towers and 172,724 colocations in India as of March. 31, 2019.
We have entered into Master Service Agreements (MSAs) with our customers. The MSAs are long-term contracts which set out the terms on which access is provided to Bharti Infratelâs and Indusâ towers, with all service providers being offered substantially the same terms and receiving equal treatment at towers where they have installed their active infrastructure. Under the MSAs, Bharti Infratel and Indus Towers enter into service contracts in respect of individual towers. The MSAs and service contracts govern Bharti Infratelâs and Indusâ relationship with their customers, the services provided, the applicable charges and incorporate annual escalation clauses in respect of the applicable charges. This provides stability to our business and provides visibility with regard to future revenues.
Financial Highlights
A. Consolidated financial results as per Ind AS
(Rs. Mn)
|
Particulars |
Year ended March. 31, 2019 |
Year ended March. 31, 2018 |
|
Revenue1 |
68,262 |
66,212 |
|
EBITDA1 |
31,666 |
31,865 |
|
Profit before Tax |
35,527 |
35,292 |
|
Profit after Tax |
24,938 |
24,937 |
1 Revenue & EBITDA are excluding other income
B. Standalone financial results as per Ind AS
(Rs. Mn)
|
Particulars |
Year ended March. 31, 2019 |
Year ended March. 31, 2018 |
|
Revenue1 |
68,217 |
66,180 |
|
EBITDA1 |
31,680 |
31,854 |
|
Profit before Tax |
36,651 |
32,270 |
|
Profit after Tax |
27,790 |
24,139 |
1 Revenue & EBITDA are excluding other income
Share Capital
During the year, there was no change in the Companyâs issued, subscribed and paid-up equity share capital. On March. 31, 2019, it stood at RS.18,496,082,460 represented by 1,849,608,246 equity shares of RS.10 each.
Transfer to Reserves
The Company has not transferred any amount to the General Reserve for the financial year ended March. 31, 2019.
Dividend
During the year, the Board, on October 24, 2018, had declared an interim dividend of RS.7.5 per equity share of RS.10 each fully paid up (75% of face value) for FY 2018-19 amounting to RS.13,872 Mn (excluding tax on dividend). The Board has also declared a 2nd interim dividend of RS.7.5 per equity share of RS.10 each fully paid up (75% of face value) for FY 2018-19 amounting to RS.13,872 Mn (excluding tax on dividend) on April 24, 2019.
Dividend Distribution Policy
As per Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âthe Listing Regulationsâ), top 500 listed companies based on the market capitalization shall formulate a dividend distribution policy. Accordingly, the policy was adopted by the Board of Directors of the Company to set out the parameters and circumstances that will be taken into account by the Board in determining the distribution of dividend to its shareholders and / or retaining profits earned by the Company. The Dividend Distribution Policy is available on the Companyâs website at www.bharti-infratel.com and is annexed as Annexure A to this report.
Fixed Deposits
The Company has not accepted any fixed deposit and as such no amount of principal or interest was outstanding as on the date of balance sheet.
Significant Developments
Amalgamation of Indus Towers Limited with and into Bharti Infratel Limited
The Board of Directors of the Company had at its meeting held on April 24, 2018, approved amalgamation of Indus Towers Limited into and with the Company (Infratel) subject to necessary statutory and other approvals as maybe required to create a pan-India listed tower Company, with over 163,000 towers operating across all 22 telecom service areas in India.
Key Highlights of the merger are:
- The merged Company will fully own the business of Bharti Infratel and Indus Towers. Its name will be changed to Indus Towers Limited and it will continue to be listed on the BSE Limited and National Stock Exchange of India Limited.
- The merged Company will be governed by a shareholdersâ agreement. Bharti Airtel (existing promoter) and Vodafone Group will jointly control the merged Company.
- Share exchange ratio considered for the purpose of merger scheme is consistent with recommendations of independent valuer which has been opined to be fair by merchant bankers.
- The Board of the merged Company will be re-constituted in accordance with the shareholdersâ agreement and the Chairman of the Board will be an independent director.
- The combination of the two companiesâ highly complementary footprints will create a tower operator with the ability to offer the high quality shared passive infrastructure services needed to support the pan-India expansion of wireless broadband services using 4G /5G technologies for the benefit of Indian consumers and businesses.
The Company has received approval from the Competition Commission of India (CCI) on June 29, 2018 and has also received no-objection from BSE Limited and National Stock Exchange of India Limited on July 24, 2018. The Equity Shareholders and Unsecured Creditors of the Company have approved the amalgamation in their respective meetings held on February 2, 2019. Subsequently, an application for sanction of the scheme has been filed with National Company Law Tribunal, Chandigarh Bench (âNCLTâ) and has been admitted. The Scheme shall become effective upon receipt of necessary approvals and other condition precedents.
Directors and Key Managerial Personnel
Induction, Re-appointment and Resignation
Anita Kapur (DIN: 07902012) was appointed as an Independent Director of the Company by the shareholders at the last Annual General Meeting (AGM) of the Company held on July 24, 2018. She will hold the office for a term of five years i.e. up till January 16, 2023.
Pursuant to the provisions of the Companies Act, 2013, D S Rawat (DIN: 06798626), Director of the Company will retire by rotation at the ensuing AGM and being eligible, has offered himself for re-appointment. The Board recommends his re-appointment as Director at the ensuing AGM.
Sanjay Nayar (DIN: 00002615), Non-Executive Director of the Company has resigned from the Board w.e.f. conclusion of Board meeting dated January 23, 2019. The Board placed on record its sincere appreciation for the guidance and contribution made by him during his tenure on the Board.
Pursuant to the provisions of Section 161 and other applicable provisions of the Companies Act, 2013 and applicable provisions of the Listing Regulations and as recommended by HR, Nomination and Remuneration Committee, Prakul Kaushiva (DIN: 08285582), was appointed as an Additional Director in the capacity of a Non-Executive Director w.e.f January 24, 2019. He will hold office upto the date of ensuing AGM. The Company has received requisite notice from a member under Section 160 of the Companies Act, 2013 proposing the appointment of Prakul Kaushiva as Director, liable to retire by rotation. The Board recommends his appointment as a Director liable to retire by rotation at the ensuing AGM.
Bharat Sumant Raut (DIN: 00066080), Jitender Balakrshnan (DIN: 00028320), Leena Srivastava (DIN: 00005737) and Narayanan Kumar (DIN: 00007848) have completed their present terms as Independent Directors of the Company on March. 31, 2019. On the recommendation of the HR, Nomination and Remuneration Committee, the Board in its meeting held on January 23, 2019 subject to the approval of shareholders, has re-appointed them as Independent Directors for a further term of five years w.e.f. April 01, 2019. The Board recommends their re-appointment at the ensuing AGM.
Brief resumes, nature of expertise, disclosure of relationships between directors inter-se, details of directorships and Committee membership held in other companies of the Directors proposed to be appointed/ re-appointed, along with their shareholding in the Company, as stipulated under Secretarial Standard- 2 and Regulation 36 of the Listing Regulations, is appended as an Annexure to the Notice of the ensuing AGM.
Pankaj Miglani, Chief Financial Officer has resigned w.e.f. August 9, 2018. The Directors placed on record their appreciation for the contribution made by him during his tenure. The Board in its meeting held on June 22, 2018 has appointed Subramanian Balasubramanian as the Chief Financial Officer of the Company w.e.f. August 10, 2018.
Declaration by Independent Directors
The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under Section 149 of the Companies Act, 2013 and Regulation 16 & 25 of the Listing Regulations. The Independent Directors have also confirmed that they have complied with the Companyâs code of conduct.
Policy on Nomination, Remuneration and Board Diversity
The Company believes that building a diverse and inclusive culture is integral to its success. A diverse Board will be able to leverage different skills, qualifications, professional experiences, perspectives and backgrounds, which is necessary for achieving sustainable and balanced development. The Board has adopted a Policy on Nomination, Remuneration and Board Diversity, which sets out the criteria for determining qualifications, positive attributes and independence of a Director. The detailed policy is available on the Companyâs website at http://www.bharti-infratel. com/cps-portal/web/pdf/Policy%20on%20Nomination,%20 Remuneration%20and%20Board%20Diversity%20update.pdf and is annexed as Annexure B to this report.
Annual Board Evaluation and Familiarisation Programme for Board Members
A note on the familiarisation programme adopted by the Company for orientation and training of the Directors, and the Board Evaluation process undertaken in compliance with the provisions of the Companies Act, 2013 and Listing Regulations is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
The HR, Nomination and Remuneration Committee, in consultation with external agency hired for the purpose of Board Evaluation, has put in place a robust framework for evaluation of the Board, Board Committees and Individual Directors. Customized questionnaires were circulated, responses were analyzed and the results were subsequently discussed by the Board. Recommendations arising from the Evaluation process were duly considered by the Board to further augment its effectiveness. A detailed update on the Board Evaluation is provided in the report on Corporate Governance which forms part of this Integrated Report..
Board Meetings
During FY 2018-19, the Board of Directors met 6 times i.e. on April 23, 2018; April 24, 2018; June 22, 2018; July 25, 2018; October 24, 2018 and January 23, 2019. The period between any two consecutive meetings of the Board of Directors of the Company was not more than 120 days.
The details regarding composition, number of Board meetings held and attendance of the Directors during FY 2018-19 are set out in the Report on Corporate Governance which forms part of this Integrated Report.
Board Committees
The Company has several Board Committees which have been established as part of the best corporate governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes. As on March. 31, 2019, the Board has 5 Committees, namely, Audit & Risk Management Committee; HR, Nomination and Remuneration Committee; Corporate Social Responsibility (CSR) Committee; Stakeholdersâ Relationship Committee and Committee of Directors. The details with respect to the composition, powers, roles, terms of reference, number of meetings etc. of the Committees held during the FY 2018-19 and attendance of the members at each Committee meeting is provided in the Report on Corporate Governance which forms part of this Integrated Report.
All the recommendations made by the Committees of the Board including the Audit & Risk Management Committee were accepted by the Board.
Subsidiary/ Joint Venture/ Associate Company
As on March. 31, 2019, the Company has a wholly owned subsidiary named Smartx Services Limited. The Company has a joint venture named Indus Towers Limited which is in the process of amalgamating with the Company.
In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements of the Company, its subsidiary and joint venture, which forms part of the Integrated Report. A statement in Form AOC- 1, containing the salient features of the financial statements of the subsidiary and Joint Venture Company is annexed as Annexure C to this report. The statement also provides the details of performance and financial position of the subsidiary and joint venture.
Audited financial statements of Smartx Services Limited for FY 2018-19 have been placed on the website of the Company, www.bharti-infratel.com. The audited financial statements of the subsidiary company is available for inspection at the Companyâs registered office and registered office of the subsidiary company. Shareholders interested in obtaining a copy of the audited financial statements of subsidiary company may write to the Company Secretary at the Companyâs registered office.
Human Resources
At Bharti Infratel, we believe people excellence is the foundation for building a culture of service excellence. Our aim is to sustain our fervor as an employer of choice and we have outlined our key focus areas during the year to achieve that goal.
We completed 11 glorious years of our establishment last year. For an eleven year old organization growing at a steady pace, it is important that the organization culture is well defined and articulated amongst all employees. Infratel is a B2B company with little or no brand presence for the end customer. It is therefore imperative for us to make our presence felt as a preferred employer to potential employee segments enabling us to attract and retain the ârightâ fits from across industries. We realized that the first step to creating an employer brand was to define and articulate the culture for Bharti Infratel which will be our USP and differentiating factor as a brand for external and internal employees. We therefore conducted a study not only to define and articulate the culture at Bharti Infratel but also create a transformation roadmap for enabling change and aligning our systems and processes to the organization and leadership expectation. The clear themes emerging out of the study were around Collaboration, People Orientation and Innovation.
Safety is viewed as a key parameter to demonstrate commitment to our people and the community at large. It is an integral part of our decision-making and is the prime consideration in all spheres of our activities. We have an effective Safety Policy in place that strives for zero fatality and prevents all workplace injuries. In order to ensure safe work practices, Cardinal Safety Rules and Consequence Management Matrix have been framed and implemented. This year to drive better awareness and consciousness on Safety we observed National Safety Week from March. 4th-11th, through Slogan contest, poster making, Safety quiz, My Safety Story, etc. Safety Training continues to be an area of focus where we ensure all new joiners complete mandatory safety training and existing employees go through refresher training.
With employee strength of nearly 1235 (on Standalone basis) spread across our 11 circles and 74 zones, Last Mile Connect continues to be critical to drive and uphold employee motivation, engagement and loyalty. Connect forums & open house sessions were held across locations. The teams were recognized for their efforts and they were made aware of the processes and policies. Special emphasis was placed towards induction and orientation of new employees.
In our continued endeavor to increase the Gender Diversity within the organization, we took an atypical route to attract women talent both at the field and non-field roles. We were successful in creating an audio visual depicting the opportunities, challenges and the work environment that we provide to our employees. We have seen positive traction with the overall Diversity Numbers move from 9.4% to 10.4% and with field roles Diversity number improving from 11% to 16%. In order to retain our women talent, there in on-going effort to conduct Gender Sensitization workshops across geographies to increase awareness about the individual differences that both sexes bring to work. The two pronged approach of attraction and retention has shown sustainable results.
To enable employees to take onus of their development, Infratel has partnered with Lynda - LinkedIn Learning for accessing world class content on the go! This was a revolutionary step as with digitalization, employees can fulfil multi-level skill development by advancing from basic to expert level for any particular skill at his/her own pace. WitRs. 98% activation rate of Linkedin Learning, employees have been accessing customized learning paths to fulfil individual capability gaps. While new employees receive training to familiarize them with our operations and processes, the existing employees were trained to enhance their efficiency levels by classroom interventions, e-learning programs, coaching, external certifications, Management Development Programs from elite institutes like ISB, IIMs. With our continuous commitment towards holistic development of our employees, we recognise that there are other sources of professional development in addition to internal trainings by way of sponsored diploma/ degree qualification upskilling. At Infratel, we strongly believe in empowering our employees through taking charge of their career and development, thereby co- creating their own individual trajectories. 100% of the employees who had selfnominated for developmental interventions were trained in FY 201819. 100% mandatory e-learning compliance has been ensured for FY 2018-19.
Employees Stock Option Plan
To retain, promote and motivate the best talent in the Company and to develop a sense of ownership among employees, the Company has instituted two ESOP schemes i.e. Employee Stock Option Scheme 2008 (ESOP Scheme 2008) and Employee Stock Option Scheme 2014 (ESOP Scheme 2014) with the approval of shareholders. The said schemes are in compliance with the SEBI (Share based Employee Benefits) Regulation, 2014, (ESOP Regulations). The HR, Nomination and Remuneration Committee monitors the Companyâs ESOP schemes.
In accordance with the ESOP Regulations, the Company had set up Bharti Infratel Employeesâ Welfare Trust (ESOP Trust) for the purpose of implementation of ESOP Schemes. Both the ESOP schemes are administered through ESOP Trust, whereby shares held by the ESOP Trust are transferred to the employees, upon exercise of stock options as per the terms of the Scheme. In terms of ESOP Regulations, neither the ESOP Trust nor any of its trustees shall exercise voting rights in respect of the shares of the Company held by the ESOP Trust.
During FY 2018-19, Company has granted 157,708 stock options under the ESOP Scheme 2014. A detailed report with respect to options exercised, vested, lapsed, exercise price, vesting period etc. under ESOP Scheme 2008 and ESOP Scheme 2014 is disclosed on the website of the Company at http://www.bharti-infratel.com/ cps-portal/web/shares.html.
A certificate from M/s Deloitte Haskins & Sells LLP, Chartered Accountants, Statutory Auditors, with respect to ESOP Scheme 2008 and ESOP Scheme 2014 would be placed before the shareholders at the ensuing AGM and a copy of the same will also be available for inspection at the registered office of the Company.
Auditors and Auditorsâ Report
Statutory Auditors & their Report
In terms of the provisions of Section 139 of the Companies Act, 2013, M/s Deloitte Haskins & Sells LLP, Chartered Accountants, (firm registration number 117366W-W100018) (âDeloitteâ) were appointed as the Statutory Auditors of the Company by the shareholders in the 11th AGM of the Company for a period of five years i.e. up to 16th AGM, subject to the ratification of appointment by members at every AGM. The requirement to place the matter relating to ratification of appointment by members at every AGM has been done away by the Companies (Amendment) Act, 2017 w.e.f. May 7, 2018. The Board has duly examined the Statutory Auditorâs Report on the Standalone and Consolidated Financial Statements of the Company for the financial year ended March. 31, 2019 by M/s Deloitte Haskins & Sells LLP, Chartered Accountants, which is self-explanatory. The report does not contain any observations, disclaimer, qualification or adverse remarks.
Further, no fraud has been reported by the Statutory Auditors in terms of Section 143(12) of the Companies Act, 2013 during the year.
Secretarial Auditor & their Report
The Company had appointed M/s. Chandrasekaran Associates, Company Secretaries, New Delhi, to conduct its Secretarial Audit for the financial year ended March. 31, 2019. The Secretarial Auditor has submitted its Report, confirming compliance by the Company of all the provisions of applicable corporate laws. The Report does not contain any qualification, observation, disclaimer or adverse remark. The Secretarial Audit Report for the FY 201819 is annexed as Annexure D to this report.
The Board has re-appointed M/s. Chandrasekaran Associates, Company Secretaries, New Delhi, as Secretarial Auditor of the Company for the FY 2019-20.
At Bharti Infratel, CSR has become embedded with its business operation and our employees also participate with great enthusiasm in creating a positive social change and supporting our ground level interventions through volunteering. The objective of Companyâs CSR initiatives is to improve the quality of life of communities through long term value creation for all stakeholders. Our social initiatives include providing education to underprivileged children in rural areas across several geographies, scholarship support to students with disabilities to pursue or continue higher education of their choice, providing safe water and sanitation facilities in rural and urban areas and schools, creating awareness on water, sanitation and hygiene, skilling unemployed youth belonging to marginalized communities and supporting research on education & environment sustainability challenges to suggesting policy mechanisms for improving the education scenario and sustainability of renewable energy.
Our CSR project beneficiaries have become a part of our larger family of stakeholders and the change these interventions have brought to their lives has been very encouraging - a skilled youth can now be more hopeful of getting a job and becoming economically independent, a girl child in a rural area can dream of pursuing education of her choice, a student with disability can break barriers of inaccessibility to scale new heights in education, explore new professions and no longer remain an invisible minority. Our work towards social development through CSR encompasses much more than just social outreach programs. We also maintain and align our business processes and goals to make a more deep-rooted impact on the societyâs sustainable development.
In accordance with the requirements of Section 135 of the Companies Act, 2013, the Company has constituted a CSR Committee. The composition and terms of reference of the CSR Committee is provided in the Report on Corporate Governance, which forms part of this Integrated Report. The Company has also formulated a Corporate Social Responsibility Policy, which is available on the Companyâs website at https://www.bharti-infratel.com/cps-portal/web/pdf/Corporate%20Social%20 Responsibility%20Policy 07062018.pdf.
During the year, the Company has spent approximately RS.414 Mn (1.88% of the net profit of last three years) on the CSR activities. As a socially responsible Company, the Company is persistently exploring new opportunities to increase its CSR expenditure to the prescribed level to create larger social impact. With this view, the Company has identified and implemented a new project during the year under review. The Board, on the recommendation of the CSR Committee, has allocated ~ RS.440 Mn (2% of the net profits) towards various CSR projects for FY 2018-19. Since, the new project was identified for implementation during the later part of the year, the entire allocated amount was not disbursed pending the stage of implementation of the new project. The Company is fully committed to the governmentâs vision of corporateâs social responsibility towards the society and is taking all the efforts for Indiaâs sustainable development by embedding wider economic, social and environment objectives.
A detailed update on the CSR initiatives of the Company is provided in the Corporate Social Responsibility section, which forms part of this Integrated Report. The Annual Report on Corporate Social Responsibility u/s 135 of the Companies Act, 2013 is annexed as Annexure E to this Report.
Integrated Reporting
SEBI vide circular dated February 6, 2017 has recommended voluntary adoption of Integrated Reporting (IR) from 2017-18 by the top 500 listed companies in India. In line with its philosophy of being a highly transparent and responsible company and considering IR as a journey, the Company adopts âIntegrated Reportâ in accordance with the International Integrated Reporting Council (IIRC) framework. The Integrated Report covers capital approach of IIRC Framework as well as the value that your Company creates for its stakeholders.
Business Responsibility Report
As stipulated under the Listing Regulations, the Business Responsibility Report, describing the initiatives taken by the Company from environmental, social and governance perspective forms a part of this Integrated Report.
Management Discussion and Analysis Report
The Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 of the Listing Regulations, is presented in a separate section, forming part of this Integrated Report.
Corporate Governance
The Company is committed to benchmark itself with global standards for providing good corporate governance. The Board constantly endeavors to take the business forward in such a way that it maximizes long term value for the stakeholders. The Company has put in place an effective corporate governance system which ensures that the provisions of Listing Regulations are duly complied with.
A detailed report on the corporate governance pursuant to the requirements of the Listing Regulations forms part of this Integrated Report.
A certificate from the auditors of the Company, M/s Deloitte Haskins & Sells LLP, Chartered Accountants, confirming compliance of conditions of corporate governance as stipulated in Listing Regulations is annexed as Annexure F to this report.
Risk Management
Risk management is embedded in Bharti Infratelâs operating framework. The Company believes that risk resilience is key to achieving higher growth. To this effect, there is a robust process in place to identify key risks across the Company and prioritize relevant action plans to mitigate these risks. Risk Management framework is reviewed periodically by the Board and the Audit & Risk Management Committee, which includes discussing the management submissions on risks, prioritizing key risks and approving action plans to mitigate such risks.
The Company has duly approved a Risk Management Policy. The objective of this Policy is to have a well-defined approach to risk. The policy lays down broad guidelines for timely identification, assessment and prioritization of risks affecting the Company in the short and foreseeable future. The Policy suggests framing an appropriate response action for the key risks identified, so as to make sure that risks are adequately addressed or mitigated.
The Internal Audit function is responsible to assist the Audit & Risk Management Committee on an independent basis with a complete review of the risk assessment and associated management action plans.
Operationally, risk is being managed at the top level by Executive Committee, chaired by the Managing Director & Chief Executive Officer and at operating level by Executive Committees of Circles headed by Circles Business Head.
Detailed discussion on Risk Management forms part of Management Discussion & Analysis under the section âRisks and Concernsâ, which forms part of this Integrated Report. At present, in the opinion of the Board of Directors, there are no risks which may threaten the existence of the Company.
Internal Financial Control and their adequacy
The Company has established a robust framework for internal financial controls. The Company has in place adequate controls, procedures and policies, ensuring orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial information. During the year, such controls were assessed and no reportable material weaknesses in the design or operation were observed. Accordingly, the Board is of the opinion that the Companyâs internal financial controls were adequate and effective during FY 2018- 19. The Internal financial controls of the Company have been further discussed in detail in the Management Discussion & Analysis section.
Vigil Mechanism
The Code of Conduct and vigil mechanism of the Company is available on the Companyâs website at www.bharti-infratel.com.
A brief note on the highlights of the Whistleblower Policy and compliance with Code of Conduct is also provided in the Report on Corporate Governance which forms part of this Integrated Report.
Quality Control
Quality Control continues to be an important driving force behind customer delight through achievement of high uptime and decreasing energy cost across our footprint.
We continue to fine tune our quality strategies in line with our aim of ensuring First Time Right. The multi-pronged strategies have been refined in line with changing field scenarios. We continue to undertake pre-dispatch inspection of all major and minor material. Stage inspection of on-site work is being undertaken by on-roll quality engineers for 100% of all new build sites and upgrades. Quality audits by independent agencies on a regular basis ensures additional controls. Preventive maintenance audits, process and design improvement and control ensures standardization and quality of workmanship. This has augmented operations and maintenance efforts throughout the lifecycle.
We have continued major projects such as tower maintenance, foundation strengthening and creation of as-built site drawings and have integrated the site data on a central platform âOne Viewâ. Last year we ensured automated quality submissions, ensembling as built drawing details into One View and initiated thermographic camera trial to improve site safety and equipment life. The referred activities have transformed the output and resulted in one of the highest quality KPI achievement during past years.
A major exercise was instituted this year for asset re-use post refurbishment and inspection towards improving asset utilization, conversion of in-door sites to outdoor for energy costs reduction and electrification of un-electrified sites. This has helped us in our continuous strive towards higher utilization and lower costs, lower energy consumption, lower network outages and improved P&Lâs for both operator and us.
Other Statutory Disclosures
Related Party Transactions
A detailed note on procedure adopted by the Company in dealing with contracts and arrangements with Related Parties is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
All arrangements / transactions entered by the Company with its Related Parties during the year were in ordinary course of business and on an armâs length basis. Particulars of material related party transactions are given in form AOC- 2 as Annexure G to this report.
Names of Related Parties and details of transactions with them under Ind AS - 24 have been included in Note no. 42 of the standalone financial statements for the year ended March. 31, 2019 on page 302.
The Policy on the Related Party Transactions is available on the Companyâs website.
Significant and material orders
There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and the Companyâs operations in future.
Material changes and commitments affecting financial position between the end of financial year and date of the report
There are no material changes and commitments affecting the financial position of the Company between the end of financial year and date of the report.
Particulars of loans, guarantees or investments
The details of loans given, investments made or guarantees given are provided in Note no. 7, 8 and 15 of the Standalone financial statements for the year ended March. 31, 2019.
Particulars of Employees
Disclosures relating to remuneration of Directors u/s 197(12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure H to this report.
The information as required to be provided in terms of Section 197 (12) of the Companies Act, 2013 read with Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure I to this report.
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo
The details of energy conservation, technology absorption and foreign exchange earnings and outgo as required under Section 134(3) of the Companies Act, 2013, read with the Rule 8 of Companies (Accounts) Rules, 2014 is annexed herewith as Annexure J to this report.
Disclosure under Section 197(14) of Companies Act, 2013
Neither the Managing Director & CEO nor the Chairman & Whole-time Director of the Company receive any remuneration or commission from its holding or subsidiary company.
Extract of Annual Return
In terms of provisions of Section 92, 134(3)(a) of the Companies Act, 2013 read with Rule 12 of Companies (Management And Administration) Rules, 2014, the extract of Annual Return of the Company in form MGT-9 is annexed as Annexure K to this report.
Sexual Harassment of Women at Workplace
The Company has an Internal Complaints Committee for providing a redressal mechanism pertaining to sexual harassment of women employees at work place. Details of the same including the details of the complaints received is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
Secretarial Standards
Pursuant to the provisions of Section 118 of the Companies Act, 2013, the Company has complied with the applicable provisions of the Secretarial Standards issued by the Institute of Companies Secretaries of India.
Directorsâ Responsibility Statement
Pursuant to Section 134(5) of the Companies Act, 2013, the Directors to the best of their knowledge and belief confirm that:
I. In the preparation of the annual accounts for the year ended March. 31, 2019, the applicable accounting standards had been followed and there is no material departure from the same;
II. The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year ended March. 31, 2019 and of the profit of the Company for the year ended on that date;
III. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
IV. The Directors had prepared the annual accounts on a âgoing concern basisâ;
V. The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively;
VI. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.
Acknowledgements
The Directors wish to place on record their appreciation for the assistance and co-operation extended by customers, strategic investors, shareholders, bankers, vendors, business partners, various agencies and departments of Government of India and State governments where Companyâs operations are existing, supporting the Companyâs various projects.
The Directors would also like to place on record their sincere appreciation for the valuable contribution, unstinted efforts and the spirit of dedication shown by the employees of the Company at all levels in ensuring an excellent all round operational performance.
For and on behalf of the Board
Akhil Gupta
Date: April 24, 2019 Chairman
Place: New Delhi DIN: 00028728
Mar 31, 2018
Dear Members,
The Directors are pleased to present the Twelfth Boardâs Report on the business and operations of the Company together with the audited financial statements for the financial year ended March.31, 2018.
Business Overview
Bharti Infratel is a provider of tower and related infrastructure sharing services. On a consolidated basis, we are one of the largest pan-India tower infrastructure providers, based on the number of towers owned and operated by Bharti Infratel and Indus Towers, which are represented by Bharti Infratelâs 42% equity interest in Indus Towers. The business of Bharti Infratel and Indus Towers is to acquire, build, own and operate towers and related infrastructure. Bharti Infratel and Indus Towers provide access to their towers primarily to wireless telecommunication service providers on a shared basis under long-term contracts. We cater to all telecom operators in India. Our three largest customers are Bharti Airtel, Vodafone India and Idea Cellular, which are the three leading wireless telecommunication service providers in India by wireless revenue.
We have a nationwide presence with operations in all 22 telecommunication circles in India, with Bharti Infratel and Indus Towers having operations in 4 overlapping circles.
As of March.31, 2018, Bharti Infratel owned and operated 39,523 towers witRs.88,665 co-locations in 11 telecommunication circles while Indus Towers operated 1,23,639 towers witRs.278,408 co-locations in 15 telecommunication circles. With Bharti Infratelâs towers and its 42% interest in Indus Towers, we have an economic interest in the equivalent of 91,451 towers and 205,596 co-locations in India as of March.31, 2018.
We have entered into Master Service Agreements (MSAs) with our customers. The MSAs are long-term contracts which set out the terms on which access is provided to Bharti Infratelâs and Indusâs towers, with all service providers being offered substantially the same terms and receiving equal treatment at towers where they have installed their active infrastructure. Under the MSAs, Bharti Infratel and Indus Towers enter into service contracts in respect of individual towers. The MSAs and service contracts govern Bharti Infratelâs and Indusâs relationship with their customers, the services provided, the applicable charges and incorporate annual escalation clauses in respect of the applicable charges. This provides stability to our business and provides visibility with regard to future revenues.
Financial Highlights
A. Consolidated financial results as per Ind AS
(H Mn)
|
Particulars |
Year ended March.31, 2018 |
Year ended March.31, 2017 |
|
Revenue1 |
66,212 |
60,847 |
|
EBIDTA1 |
31,865 |
28,525 |
|
Profit before Tax |
35,292 |
35,797 |
|
Profit after Tax |
24,937 |
27,470 |
1Revenue & EBITDA are excluding other income
B. Standalone financial results as per Ind AS
(H Mn)
|
Particulars |
Year ended March.31, 2018 |
Year ended March.31, 2017 |
|
Revenue1 |
66,180 |
60,847 |
|
EBIDTA1 |
31,854 |
28,526 |
|
Profit before Tax |
32,270 |
33,357 |
|
Profit after Tax |
24,139 |
27,050 |
1Revenue & EBITDA are excluding other income
Share Capital
During the year, there was no change in the Companyâs issued, subscribed and paid-up equity share capital. On March.31, 2018, it stood at RS.18,496,082,460 represented by 1,849,608,246 equity shares of RS.10 each.
Transfer to Reserves
The Company has not transferred any amount to the General Reserve for the financial year ended March.31, 2018.
Dividend
The Board has recommended a final dividend of RS.14 per equity share of RS.10 each fully paid up (140% of face value) for FY 2017-18 amounting to RS.25,895 Mn (excluding tax on dividend). The payment of final dividend is subject to the approval of shareholders at the ensuing Annual General Meeting (âAGMâ) of the Company.
Dividend Distribution Policy
As per Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âthe Listing Regulationsâ), top 500 listed companies based on the market capitalization shall formulate a dividend distribution policy. Accordingly, the policy was adopted by the Board of Directors of the Company to set out the parameters and circumstances that will be taken into account by the Board in determining the distribution of dividend to its shareholders and / or retaining profits earned by the Company. The Dividend Distribution Policy is available on the Companyâs website at www.bharti-infratel.com and is annexed as Annexure A to this report.
Fixed Deposits
The Company has not accepted any fixed deposit and as such no amount of principal or interest was outstanding as on the date of balance sheet.
Directors and Key Managerial Personnel
Induction, Re-appointment and Resignation
Pursuant to the provisions of Section 149, 152, schedule IV and other applicable provisions of the Companies Act, 2013 and applicable provisions of Listing Regulations, Anita Kapur (DIN: 07902012), was appointed as an Additional Director in the capacity of Independent Director w.e.f January 17, 2018 for a term of 5 years in terms of section 161 of the Companies Act 2013. She will hold office upto the date of ensuing AGM. The Company has received notice from a member proposing the candidature of Anita Kapur under Section 160 of the Companies Act, 2013. The Board recommends her appointment as an Independent Director at the ensuing AGM.
Pursuant to the provisions of the Companies Act, 2013, Tao Yih Arthur Lang (DIN: 07798156), Director of the Company will retire by rotation at the ensuing AGM and being eligible, has offered himself for re-appointment. The Board recommends his re-appointment at the ensuing AGM.
Akhil Gupta (DIN: 00028728), Chairman of the Company, will be completing his present term on July 31, 2018. On the recommendation of the HR, Nomination and Remuneration Committee, the Board in its meeting held on April 23, 2018 subject to the approval of shareholders, has re-appointed Akhil Gupta as Executive Chairman of the Company for a further term of five years w.e.f. August 01, 2018. The Board recommends his re-appointment at the ensuing AGM.
Brief resume, nature of expertise, details of directorships held in other companies of the Directors proposed to be appointed/ re-appointed, along with their shareholding in the Company, as stipulated under Secretarial Standard- 2 and Regulation 36 of the Listing Regulations, is appended as an Annexure to the Notice of the ensuing AGM.
Shweta Girotra, Company Secretary has resigned w.e.f. September 13, 2017. The Directors placed on record their appreciation for the contribution made by her during her tenure. Samridhi Rodhe has been appointed as the Company Secretary and Compliance Officer of the Company w.e.f. January 17, 2018.
Declaration by Independent Directors
The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under section 149 of the Companies Act, 2013 and the Listing Regulations. The Independent Directors have also confirmed that they have complied with the Companyâs code of conduct.
Policy on Nomination, Remuneration and Board Diversity
The Company believes that building a diverse and inclusive culture is integral to its success. A diverse Board will be able to leverage different skills, qualifications, professional experiences, perspectives and backgrounds, which is necessary for achieving sustainable and balanced development. The Board has adopted a Policy on Nomination, Remuneration and Board Diversity, which sets out the criteria for determining qualifications, positive attributes and independence of a Director. The detailed policy is available on the Companyâs website at http://www.bharti-infratel. com/cps-portal/web/pdf/Policy%20on%20Nomination,%20 Remuneration%20and%20Board%20Diversity%20update.pdf and is annexed as Annexure B to this report.
Annual Board Evaluation and Familiarisation Programme for Board Members
A note on the familiarisation programme adopted by the Company for orientation and training of the Directors, and the Board evaluation process undertaken in compliance with the provisions of the Companies Act, 2013 and Listing Regulations is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
The HR, Nomination and Remuneration Committee, in consultation with external agency hired for the purpose of Board evaluation, has put in place a robust framework for evaluation of the Board, Board Committees and Individual Directors. Customized questionnaires were circulated, responses were analyzed and the results were subsequently discussed by the Board. Recommendations arising from the evaluation process will be considered by the Board to optimize its effectiveness.
Board Meetings
During FY 2017-18, the Board of Directors met 4 times on May 8, 2017; July 24, 2017; October 30, 2017 and January 17, 2018. The period between any two consecutive meetings of the Board of Directors of the Company was not more than 120 days.
The details regarding composition, number of board meetings held and attendance of the Directors during FY 2017-18 are set out in the Report on Corporate Governance which forms part of this Integrated Report.
Board Committees
The Company has several Committees which have been established as a part of the best corporate governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes. As on March.31, 2018, the Board has 5 Committees, namely, Audit & Risk Management Committee; HR, Nomination and Remuneration Committee; Corporate Social Responsibility (CSR) Committee; Stakeholdersâ Relationship Committee and Committee of Directors. The details with respect to the composition, powers, roles, terms of reference, no. of meetings etc. of the Committees held during the FY 2017-18 and attendance of the Directors at each meeting is provided in the Report on Corporate Governance which forms part of this Integrated Report.
All the recommendations made by the committees of the Board including the Audit & Risk Management Committee were accepted by the Board.
Subsidiary/ Joint Venture/ Associate Company
As on March.31, 2018, Company has a wholly owned subsidiary named Smartx Services Limited. The Company has a joint venture named Indus Towers Limited. There was no change in the joint venture during the financial year under review.
In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements of the Company, its subsidiary and joint venture, which forms part of the Integrated Report. A statement in Form AOC- 1, containing the salient features of the financial statements of the subsidiary and joint venture company is annexed as Annexure C to this report. The statement also provides the details of performance and financial position of the subsidiary and joint venture.
Audited financial statements of Smartx Services Limited for FY 2017-18 have been placed on the website of the Company, www.bharti-infratel.com. The audited financial statements of the subsidiary company is available for inspection at the Companyâs registered office and registered office of the subsidiary company. Shareholders interested in obtaining a copy of the audited financial statements of subsidiary company may write to the Company Secretary at the Companyâs registered office.
Human Resources
At Bharti Infratel, we believe people excellence is the foundation for building a culture of service excellence. Our aim is to sustain our fervor as an employer of choice and we have outlined our key focus areas during the year to achieve that goal.
We completed 10 glorious years of our establishment last year. For a ten year old organization growing at a steady pace, it is important that the organization culture is well defined and articulated amongst all employees. Infratel is a B2B company with little or no brand presence for the end customer, it is therefore imperative for us to make our presence felt as a preferred employer to potential employee segments enabling us to attract and retain the ârightâ fits from across industries. We realized that the first step to creating an employer brand was to define and articulate the culture for Bharti Infratel which will be our USP and differentiating factor as a brand for external and internal employees. We therefore conducted a study not only to define and articulate the culture at BIL but also create a transformation roadmap for enabling change and aligning our systems and processes to the organization and leadership expectation. The clear themes emerging out of the study were around Collaboration, People Orientation and Innovation.
Safety is viewed as a key parameter to demonstrate commitment to our people and the community at large. It is an integral part of our decision-making and is the prime consideration in all spheres of our activities. We have an effective Safety Policy in place that strives for zero fatality and prevents all workplace injuries. In order to ensure safe work practices, Cardinal Safety Rules and Consequence Management Matrix have been framed and implemented. This year to drive better awareness and consciousness on Safety we observed National Road Safety Week (Jan 11-17) and National Safety Week (Mar 5-9), through Slogan contest, poster making, Safety quiz, My Safety Story, etc. Safety Training continues to be an area of focus where we ensure all new joiners complete mandatory safety training and existing employees go through refresher training.
With employee strength of nearly 1247 (on Standalone basis) spread across our 11 circles and 74 zones, Last Mile Connect continues to be critical to drive and uphold employee motivation, engagement and loyalty. Connect forums & open house sessions were held across locations. The teams were recognized for their efforts and they were made aware of the processes and policies. Special emphasis was placed towards induction and orientation of new employees.
In our continued endeavor to increase the Gender Diversity within the organization, we took an atypical route to attract women talent both at the field and non-field roles. We were successful in creating an audio visual depicting the opportunities, challenges and the work environment that we provide to our employees. We have seen positive traction with the overall Diversity Numbers move from 7% to 9.4%, and with field roles Diversity number improving from 4.9% to 12.5%. In order to retain our women talent, there in on-going effort to conduct Gender Sensitization workshops across geographies to increase awareness about the individual differences that both sexes bring to work. The two pronged approach of attraction and retention has shown sustainable results.
At Infratel, we strongly believe in identifying and developing internal talent to meet our growth objectives and drive business performance. Given the dynamic state of business in todayâs market, it is imperative that we proactively identify the weak spots and build capabilities of our mid-level leaders to be able to lead teams and deliver results even more efficiently & effectively. Addressing talent gaps and developing internal talent takes precedence at Infratel. The potential of our future leaders is critical to the organizationâs success and hence we follow a structured mechanism to assess and develop our mid-level leaders so as to build a sustainable pipeline of internal talent. This year, we carried out an extensive study to create the leadership success profile defining key behaviors from operations, business and people stand point. This was followed by an assessment of most of our mid-level leaders at BIL to understand the current level of potential and identify capability gaps against the leadership success profile. We have further built a focused and dedicated development approach for bridging the identified capability gaps and preparing them for future leadership roles.
Employees Stock Option Plan
To retain, promote and motivate the best talent in the Company and to develop a sense of ownership among employees, the Company has instituted two ESOP schemes i.e. Employee Stock Option Scheme 2008 (ESOP Scheme 2008) and Employee Stock Option Scheme 2014 (ESOP Scheme 2014) with the approval of shareholders. The said schemes are in compliance with the SEBI (Share based Employee Benefits) Regulation, 2014, (ESOP Regulations). The HR, Nomination and Remuneration Committee monitors the Companyâs ESOP schemes.
In accordance with the ESOP Regulations, the Company had set up Bharti Infratel Employeesâ Welfare Trust (ESOP Trust) for the purpose of implementation of ESOP Schemes. Both the ESOP schemes are administered through ESOP Trust, whereby shares held by the ESOP Trust are transferred to the employees, upon exercise of stock options as per the terms of the Scheme. In terms of ESOP Regulations, neither the ESOP Trust nor any of its trustees shall exercise voting rights in respect of the shares of the Company held by the ESOP Trust.
During FY 2017-18, Company has granted 114,694 stock options under the ESOP Scheme 2014. A detailed report with respect to options exercised, vested, lapsed, exercise price, vesting period etc. under ESOP Scheme 2008 and ESOP Scheme 2014 is disclosed on the website of the Company at http://www.bharti-infratel.com/cps-portal/web/shares.html.
A certificate from M/s Deloitte Haskins & Sells LLP, Chartered Accountants, Statutory Auditors, with respect to ESOP Scheme 2008 and ESOP Scheme 2014 would be placed before the shareholders at the ensuing AGM and a copy of the same will also be available for inspection at the registered office of the Company.
Auditors and Auditorsâ Report Statutory Auditors
In terms of the provisions of Section 139 of the Companies Act, 2013, M/s Deloitte Haskins & Sells LLP, Chartered Accountants, (firm registration number 117366W-W100018) (âDeloitteâ) were appointed as the Statutory Auditors of the Company by the shareholders in the 11th AGM of the Company for a period of five years i.e. up to 16th AGM. The said appointment is subject to ratification by the members at every AGM.
The Company has received a letter from M/s Deloitte Haskins & Sells LLP, Chartered Accountants, confirming their eligibility under section 139 and 141 of the Companies Act, 2013. The Board has recommended ratification of appointment of M/s Deloitte Haskins & Sells LLP, Chartered Accountants, to the shareholders at the ensuing AGM till the next AGM. The annual ratification of auditors at the next AGM for their remaining term as aforesaid, shall be done, if required by the law.
Auditorâs Report
The Board has duly examined the Statutory Auditorâs Report on the Standalone and Consolidated Financial Statements of the Company for the financial year ended March.31, 2018 by M/s Deloitte Haskins & Sells LLP, Chartered Accountants, which is self-explanatory. The report does not contain any observations, disclaimer, qualification or adverse remarks.
Further, no fraud has been reported by the Statutory Auditorsâ in terms of Section 143(12) of the Companies Act, 2013 during the year.
Secretarial Auditor & their Report
The Company had appointed M/s. Chandrasekaran Associates, Company Secretaries, New Delhi, to conduct its Secretarial Audit for the financial year ended March.31, 2018. The Secretarial Auditor has submitted its Report, confirming compliance by the Company of all the provisions of applicable corporate laws. The Report does not contain any qualification, observation, disclaimer or adverse remark. The Secretarial Audit Report for the FY 201718 is annexed as Annexure D to this report.
The Board has re-appointed M/s. Chandrasekaran Associates, Company Secretaries, New Delhi, as Secretarial Auditor of the Company for the FY 2018-19.
Corporate Social Responsibility
At Bharti Infratel CSR has become embedded with its business operation and our employees also participate with great enthusiasm in creating a positive social change and supporting our ground level interventions through volunteering. Our social initiatives include providing education to underprivileged children in rural areas across several geographies, scholarship support to students with disabilities to pursue or continue higher education of their choice, providing safe water and sanitation facilities in rural and urban areas and schools, creating awareness on water, sanitation and hygiene, skilling unemployed youth belonging to marginalized communities and supporting research on education & environment sustainability challenges to suggesting policy mechanisms for improving the education scenario and sustainability of renewable energy.
Our CSR project beneficiaries have become a part of our larger family of stakeholders and the change these interventions have brought to their lives has been very encouraging - a skilled youth can now be more hopeful of getting a job and becoming economically independent, a girl child in a rural area can dream of pursuing education of her choice, a student with disability can break barriers of inaccessibility to scale new heights in education, explore new professions and no longer remain an invisible minority. Our work towards social development through CSR encompasses much more than just social outreach programs, we also maintain and align our business processes and goals to make a more deep-rooted impact on the societyâs sustainable development.
In accordance with the requirements of Section 135 of the Companies Act, 2013, the Company has constituted a CSR Committee. The composition and terms of reference of the CSR Committee is provided in the Report on Corporate Governance, which forms part of this Integrated Report. The Company has also formulated a Corporate Social Responsibility Policy, which is available on the Companyâs website at http://www.bharti-infratel.com/cps-portal/web/pdf/Corporate%20Social%20 Responsibility%20Policy 07062018.pdf.
The Company has made CSR contribution of RS.211.56 Mn under Section 135 of Companies Act, 2013 and the Company has also contributed RS.2.07 Mn to other charitable causes, during FY 2017-18.
The consolidated contribution of the Company towards various CSR activities during FY 2017-18 is RS.213.63 Mn (i.e. 1.07% of net profit of last three years). Since the external evaluation of new projects is planned in FY18-19, any new or scaling up of the current projects will be decided post the assessment. The Company will duly explore new opportunities or scale up current projects to increase its CSR expenditure to the prescribed level. As a socially responsible company, the Company is committed to play a larger role in Indiaâs sustainable development by embedding wider economic, social and environmental objectives.
A detailed update on the CSR initiatives of the Company is provided in the Corporate Social Responsibility section, which forms part of this Integrated Report. The Annual Report on Corporate Social Responsibility u/s 135 of the Companies Act, 2013 is annexed as Annexure E to this Report.
Business Responsibility Report
As stipulated under the Listing Regulations, the Business Responsibility Report, describing the initiatives taken by the Company from environmental, social and governance perspective forms a part of this Integrated Report.
Management Discussion and Analysis
The Management Discussion and Analysis Report for the year under review, as stipulated under the Listing Regulations, is presented in a separate section, forming part of this Integrated Report.
Corporate Governance
Your Company is committed to benchmark itself with global standards for providing good corporate governance. The Board constantly endeavours to take the business forward in such a way that it maximises long term value for the stakeholders. The Company has put in place an effective corporate governance system which ensures that the provisions of Listing Regulations are duly complied with.
A detailed report on the corporate governance pursuant to the requirements of the Listing Regulations forms part of this Integrated Report.
A certificate from the auditors of the Company, M/s Deloitte Haskins & Sells LLP, Chartered Accountants, confirming compliance of conditions of corporate governance as stipulated in Listing Regulations is annexed as Annexure F to this report.
Risk Management
Risk management is embedded in Bharti Infratelâs operating framework. The Company believes that risk resilience is key to achieving higher growth. To this effect, there is a robust process in place to identify key risks across the Company and prioritize relevant action plans to mitigate these risks. Risk Management framework is reviewed periodically by the Board and the Audit & Risk Management Committee, which includes discussing the management submissions on risks, prioritizing key risks and approving action plans to mitigate such risks.
The Company has duly approved a Risk Management Policy. The objective of this Policy is to have a well-defined approach to risk. The policy lays down broad guidelines for timely identification, assessment and prioritization of risks affecting the Company in the short and foreseeable future. The Policy suggests framing an appropriate response action for the key risks identified, so as to make sure that risks are adequately addressed or mitigated.
The Internal Audit function is responsible to assist the Audit & Risk Management Committee on an independent basis with a complete review of the risk assessment and associated management action plans.
Operationally, risk is being managed at the top level by Executive Committee, chaired by the Managing Director & CEO and at operating level by Executive Committees of Circles headed by Circles Business Head.
Detailed discussion on Risk Management forms part of Management Discussion & Analysis under the section âRisks and Concernsâ, which forms part of this Integrated Report. At present, in the opinion of the Board of Directors, there are no risks which may threaten the existence of the Company.
Internal Financial Control and their adequacy
The Company has established a robust framework for internal financial controls. The Company has in place adequate controls, procedures and policies, ensuring orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial information. During the year, such controls were assessed and no reportable material weaknesses in the design or operation were observed. Accordingly, the Board is of the opinion that the Companyâs internal financial controls were adequate and effective during FY 2017- 18. The Internal financial controls of the Company have been further discussed in detail in the Management Discussion and Analysis section.
Vigil Mechanism
The Code of Conduct and vigil mechanism of the Company is available on the Companyâs website at www.bharti-infratel.com.
A brief note on the highlights of the Ombudsperson Policy and compliance with Code of Conduct is also provided in the Report on Corporate Governance which forms part of this Integrated Report.
Quality Control
Quality control has been one of the prime forces behind customer delight through achievement of highest uptime and lowest energy cost across our footprint.
We have been consistently upgrading our quality strategies in line with our vision of ensuring First Time Right. Multi-pronged strategies have been adopted to strengthen the quality process including Pre-dispatch inspection of all major material, on-site inspection during installation work in progress, Quality audits post completion of work, preventive maintenance audits to ensure appropriate Controls, process orientation and control of designs, materials, and workmanship at site, operations and maintenance throughout the lifecycle.
Last year we had initiated three major activities for further strengthening of quality within organization i.e. up gradation of tower maintenance activities, creation of as built site drawings, integration of last quality leg into CIT via tablets. The referred activities have transformed the output and resulted in one of the highest quality KPI achievement during past years.
To further strengthen the already initiated journey, this year we are planning to put up all the collected data from our activities on a central platform âOne Viewâ. This should help to us in continuing to support organization in optimum utilization of equipment throughout designed lives thus ensuring lower costs, lower network outages and improved P&Lâs for both operators and us.
Other Statutory Disclosures Related Party Transactions
A detailed note on procedure adopted by the Company in dealing with contracts and arrangements with Related Parties is provided in the Report on Corporate Governance, which forms part of this Integrated Report.
All arrangements / transactions entered by the Company with its Related Parties during the year were in ordinary course of business and on an armâs length basis. Particulars of material related party transactions are given in form AOC- 2 as Annexure G to this report.
Names of Related Parties and details of transactions with them under Ind AS - 24 have been included in Note no. 43 of the standalone financial statements for the year ended March.31, 2018 on page 275.
The Policy on the Related Party Transactions is available on the Companyâs website.
Significant and material orders
Pursuant to the Order of the Regional Director, New Delhi dated April 02, 2018, the Company shifted its registered office from NCT of Delhi to the State of Haryana w.e.f. April 17, 2018. The Company has also altered its Object Clause during the year under review. Certificate of registration from ROC approving the alteration of Object Clause was received on MarcRs.23, 2018.
There are no other significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Companyâs operations in future.
Material changes and commitments affecting financial position between the end of financial year and date of the report
There are no material changes and commitments affecting the financial position of the Company between the end of financial year and date of the report.
Particulars of loans, guarantees or investments
The details of loans given, investments made or guarantees given are provided in Note no. 7, 8 and 15 of the Standalone financial statements for the year ended March.31, 2018.
Particulars of Employees
Disclosures relating to remuneration of Directors u/s 197(12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure H to this report.
The information as required to be provided in terms of Section 197 (12) of the Companies Act, 2013 read with Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure I to this report.
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo
The details of energy conservation, technology absorption and foreign exchange earnings and outgo as required under Section 134(3) of the Companies Act, 2013, read with the Rule 8 of Companies (Accounts of Companies) Rules, 2014 is annexed herewith as Annexure J to this report.
Disclosure under Section 197(14) of Companies Act, 2013
Neither the Managing Director & CEO nor the Chairman & Whole-time Director of the Company receive any remuneration or commission from its holding or subsidiary company.
Extract of Annual Return
In terms of provisions of Section 92, 134(3)(a) of the Companies Act, 2013 read with Rule 12 of Companies (Management And Administration) Rules, 2014, the extracts of Annual Return of the Company in form MGT-9 is annexed as Annexure K to this report.
Directorsâ Responsibility Statement
Pursuant to Section 134(5) of the Companies Act, 2013, the Directors to the best of their knowledge and belief confirm that:
I. In the preparation of the annual accounts for the year ended March.31, 2018, the applicable accounting standards had been followed and there is no material departure from the same;
II. The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year ended March.31, 2018 and of the profit of the Company for the year ended on that date;
III. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
IV. The Directors had prepared the annual accounts on a âgoing concern basisâ;
V. The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively;
VI. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.
Acknowledgements
The Directors wish to place on record their appreciation for the assistance and co-operation extended by customers, strategic investors, bankers, vendors, business partners, various agencies and departments of Government of India and State governments where Companyâs operations are existing, supporting the Companyâs various projects.
The Directors would also like to place on record their sincere appreciation for the valuable contribution, unstinted efforts and the spirit of dedication shown by the employees of the Company at all levels in ensuring an excellent all round operational performance.
For and on behalf of the Board
Akhil Gupta
Date: April 23, 2018 Chairman
Place: New Delhi DIN: 00028728
Mar 31, 2017
Dear Members,
The Directors are pleased to present the Eleventh Boardâs Report on the business and operations of the Company together with the audited financial statements for the financial year ended March 31, 2017.
Business Overview
Bharti Infratel is a provider of tower and related infrastructure sharing services. On a consolidated basis, we are one of the largest pan-India tower infrastructure providers, based on the number of towers owned and operated by Bharti Infratel and Indus Towers, which are represented by Bharti Infratelâs 42% equity interest in Indus Towers. The business of Bharti Infratel and Indus Towers is to acquire, build, own and operate towers and related infrastructure. Bharti Infratel and Indus Towers provide access to their towers primarily to wireless telecommunication service providers on a shared basis under long-term contracts. We cater to all telecom operators in India. Our three largest customers are Bharti Airtel, Vodafone India and Idea Cellular, which are the three leading wireless telecommunication service providers in India by wireless revenue.
We have a nationwide presence with operations in all 22 telecommunication circles in India, with Bharti Infratel and Indus Towers having operations in 4 overlapping circles.
As of March 31, 2017, Bharti Infratel owned and operated 39,099 towers with 89,263 co-locations in 11 telecommunication circles while Indus Towers operated 122,730 towers with 288,913 co-locations in 15 telecommunication circles. With Bharti Infratelâs towers and its 42% interest in Indus Towers, we have an economic interest in the equivalent of 90,646 towers and 210,606 co-locations in India as of March 31, 2017.
We have entered into Master Service Agreements (MSAs) with our customers. The MSAs are long-term contracts which set out the terms on which access is provided to Bharti Infratelâs and Indusâs towers, with all service providers being offered substantially the same terms and receiving equal treatment at towers where they have installed their active infrastructure. Under the MSAs, Bharti Infratel and Indus Towers enter into service contracts in respect of individual towers. The MSAs and service contracts govern Bharti Infratelâs and Indusâs relationship with their customers, the services provided, the applicable charges and incorporate annual escalation clauses in respect of the applicable charges. This provides stability to our business and provides visibility with regard to future revenues.
Financial Highlights
A. Consolidated financial results as per Ind AS
(Rs, Millions)
|
Particulars |
Year ended March 31, 2017 |
Year ended March 31, 2016 |
|
Revenue1 |
60,847 |
55,583 |
|
EBIDTA1 |
28,525 |
25,097 |
|
Profit before Tax |
35,797 |
29,791 |
|
Profit after Tax |
27,470 |
22,474 |
1Revenue & EBITDA are excluding other income
B. Standalone financial results as per Ind AS
_(Rs, Millions)
|
Particulars |
Year ended March 31, 2017 |
Year ended March 31, 2016 |
|
Revenue1 |
60,847 |
55,583 |
|
EBIDTA1 |
28,526 |
25,098 |
|
Profit before Tax |
33,357 |
18,723 |
|
Profit after Tax |
27,050 |
13,274 |
1Revenue & EBITDA are excluding other income
Indian Accounting Standard (Ind AS)
The Ministry of Corporate Affairs (MCA), vide its notification in the Official Gazette dated February 16, 2015, notified the Ind AS applicable to certain class of Companies. Ind AS has replaced the existing Indian GAAP prescribed under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014. For Bharti Infratel, Ind AS is applicable from April 1, 2016, with a transition date of April 1, 2015 and IGAAP as the previous GAAP
The reconciliation and description of the effect of the transition from IGAAP to Ind AS have been provided in Note no. 44 of the standalone and consolidated financial statements for the year ended March 31, 2017.
Share Capital
During the year, the Company has extinguished 47,058,823 equity shares of Rs, 10/- each consequent upon the Buy-back of equity shares of the Company. The paid up share capital of the Company has decreased from Rs, 18,966,670,690 to Rs, 18,496,082,460 represented by 1,849,608,246 equity shares of Rs, 10 each as on March 31, 2017.
Buy-back of Equity Shares
During the year under review, the Company had completed Buy-back of 47,058,823 equity shares (representing 2.48% of total pre Buy-back equity share capital) of Rs, 10/each at a price of Rs, 425/- per equity share aggregating Rs, 19,999,999,775 (Rupees One Thousand Nine Hundred Ninety Nine Crores Ninety Nine Lakhs Ninety Nine Thousand Seven Hundred and Seventy Five Only), excluding the transaction costs viz. brokerage, applicable taxes such as securities transaction tax, service tax, stamp duty etc. The Buy-back size represented 19.30 % of the total paid up equity capital and free reserves of the Company as per the audited accounts of the Company for the financial year ended March 31, 2016. The Buy-back of shares from the shareholders of the Company was on proportionate basis through tender offer route as prescribed under the Companies Act, 2013 and the Securities and Exchange Board of India (Buy-back of Securities) Regulations, 1998, as amended.
The Buy-back is a capital allocation decision taken with the objective of seeking a fairer valuation of the Companyâs stock while improving the Companyâs Return on Equity, and increasing shareholder value in the longer term.
Transfer to Reserves
The Company has not transferred any amount to the General Reserve for the financial year ended March 31, 2017.The Company has transferred Rs, 471 Mn from General reserve to Capital Redemption Reserve (CRR) in respect of Buy-back of 47,058,823 equity shares of face value of Rs, 10/- each of the Company.
Dividend
The Board has recommended a final dividend of Rs, 4 per equity share of Rs, 10 each fully paid up (40% of face value) for FY 2016-17 amounting to Rs, 7,398 Mn (excluding tax on dividend). The payment of final dividend is subject to the approval of shareholders at the ensuing Annual General Meeting (AGM) of the Company.
During the year, the Board had also paid an interim dividend of Rs, 12 per equity share of Rs, 10 each fully paid up (120% of face value) for FY 2016-17 amounting to Rs, 22,195 Mn (excluding tax on dividend).
The total dividend (excluding dividend tax) for FY 2016-17 is Rs, 29,593 Mn.
Dividend Distribution Policy
As per Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âthe Listing Regulationsâ), top 500 listed companies based on the market capitalization shall formulate a dividend distribution policy. Accordingly, the policy was adopted by the Board of Directors of the Company to set out the parameters and circumstances that will be taken into account by the Board in determining the distribution of dividend to its shareholders and / or retaining profits earned by the Company. The Dividend Distribution Policy is available on the Companyâs website at www.bharti-infratel.com and is annexed as Annexure A to this report.
Fixed Deposits
The Company has not accepted any fixed deposit and as such no amount of principal or interest was outstanding as on the date of balance sheet.
Details of utilization of IPO proceeds
Pursuant to the Initial Public Offer in December, 2012, the Company collected Rs, 31,657 Mn (net of selling shareholdersâ proceeds). The Company had, in terms of Prospectus, proposed to utilize the IPO Proceeds towards objects of the Issue by March 31, 2016. Whilst the Company had made best efforts to utilize the IPO proceeds as per the terms of the Issue, Rs, 9,403 Mn. was pending utilization as on December 31, 2015 for which the Company had obtained approval of the shareholdersâ by way of special resolution through Postal Ballot for variation in terms of the Objects of the Issue.
During the year, the Company has fully utilized the IPO proceeds towards the Object of the Issue as stated in the prospectus and / or as approved by the shareholders through postal ballot dated March 21, 2016.
For details of utilization of IPO proceeds subsequent to approval of the shareholdersâ, please refer Note no. 41 of the standalone financial statements for the year ended March 31, 2017 on page no. 271.
Directors and Key Managerial Personnel
Induction, Re-appointment and Resignation Mark Chin Kok Chong, Non-Executive Director of the Company has resigned from the Board w.e.f. conclusion of the Board Meeting held on May 8, 2017. The Board placed on record itsâ sincere appreciation for help, guidance and contribution made by the outgoing Director during his tenure on the Board.
Sanjay Omprakash Nayar and Tao Yih Arthur Lang were appointed as Additional Directors designated as NonExecutive Directors on the Board w.e.f. May 8, 2017 and conclusion of Board Meeting held on May 8, 2017 respectively. The Company has received requisite notice from a member under Section 160 of the Companies Act, 2013, along with deposit of '' 1,00,000/- for each Director proposing the appointment of Sanjay Omprakash Nayar and Tao Yih Arthur Lang as Non-Executive Directors, liable to retire by rotation at the ensuing AGM.
Rajan Bharti Mittal was appointed as Non-Executive Director by the shareholders at the last AGM of the Company. Pursuant to the provisions of the Companies Act, 2013, Rajan Bharti Mittal, Director of the Company, is liable to retire by rotation at the forthcoming AGM and being eligible, has offered himself for re-appointment.
D S Rawat, Managing Director & CEO has completed his present term as Managing Director & CEO on March 31, 2017. On the recommendation of the HR, Nomination and Remuneration Committee, the Board in its meeting held on January 23, 2017, subject to approval of shareholders has re-appointed D S Rawat as Managing Director & CEO of the Company for a further term of 3 years w.e.f. April 1, 2017.
A brief resume, nature of expertise, details of other directorships and other information of the Directors proposed to be appointed/ re-appointed as stipulated in Secretarial Standard 2 and Regulation 36 of the Listing Regulations is appended as an annexure to the notice of ensuing AGM.
Declaration by Independent Directors
The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under Section 149 of the Companies Act, 2013 and the Listing Regulations. The Independent Directors have also confirmed that they have complied with the Companyâs code of conduct.
Policy on Nomination, Remuneration and Board Diversity
The Company believes that building a diverse and inclusive culture is integral to its success. A diverse Board will be able to leverage different skills, qualifications, professional experiences, perspectives and backgrounds, which is necessary for achieving sustainable and balanced development. The Board has adopted a Policy on Nomination, Remuneration and Board Diversity, which sets out the criteria for determining qualifications, positive attributes and independence of a Director. The detailed policy is available on the Companyâs website at http://www. bharti-infratel.com/cps-portal/web/pdf/Policy%20on%20 Nomination,%20Remuneration%20and%20Board%20 Diversity 28092016.pdf and is annexed as Annexure B to this report.
Annual Board Evaluation and Familiarization Programme for Board Members
A note on the familiarization programme adopted by the Company for orientation and training of the Directors, and the Board evaluation process undertaken in compliance with the provisions of the Companies Act, 2013 and Listing Regulations is provided in the Report on Corporate Governance, which forms part of this Annual Report.
The HR, Nomination and Remuneration Committee has put in place a robust framework for evaluation of the Board, Board Committees and Individual Directors. Customized questionnaires were circulated, responses were analyzed and the results were subsequently discussed by the Board. Recommendations arising from the evaluation process will be considered by the Board to optimize its effectiveness.
Board Meetings
During FY 2016-17, the Board of Directors met 5 times i.e. on April 26, 2016; July 26, 2016; October 24, 2016; January 23, 2017 and March 22, 2017. The period between any two consecutive meetings of the Board of Directors of the Company was not more than 120 days.
The details regarding composition, number of board meetings held and attendance of the Directors during FY 2016-17 are set out in the Report on Corporate Governance which forms part of this Annual Report.
Board Committees
The Company has several Committees which have been established as a part of the best corporate governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes. As on March 31, 2017, the Board has 5 Committees, namely, Audit and Risk Management Committee; HR, Nomination and Remuneration Committee; Corporate Social Responsibility (CSR) Committee; Stakeholdersâ Relationship Committee and Committee of Directors. The details with respect to the composition, powers, roles, terms of reference, no. of meetings etc. of the Committees held during FY 2016-17 and attendance of the Directors at each meeting is provided in the Report on Corporate Governance which forms part of this Annual Report.
All the recommendations made by the committees of the Board including the Audit & Risk Management Committee were accepted by the Board.
Subsidiary/ Joint Venture/ Associate Company
As on March 31, 2017, the Company has a wholly owned subsidiary in the name of Smartx Services Limited. During the year, name of Bharti Infratel Services Limited, another wholly owned subsidiary Company was Struck-off from the register of Companies by the Registrar of Companies, NCT of Delhi and Haryana. The details of such striking off was published in the Official Gazette of Ministry of Corporate Affairs.
Further, the Company has a joint venture in the name of Indus Towers Limited. There was no change in the joint venture during the financial year under review.
In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements of the Company, its subsidiary and joint venture, which forms part of the Annual Report. A statement in Form AOC-1, containing the salient features of the financial statements of the subsidiary and Joint Venture Company is annexed as Annexure C to this report. The statement also provides the details of performance and financial position of the subsidiary and joint venture.
Audited financial statements of Smartx Services Limited for FY 2016-17 have been placed on the website of the Company, www.bharti-infratel.com. The audited financial statements of the subsidiary is available for inspection at the Companyâs registered office and registered office of the subsidiary Company. Shareholders interested in obtaining a copy of the audited financial statements of subsidiary may write to the Company Secretary at the Companyâs registered office.
Human Resources
At Bharti Infratel, we believe people excellence is the foundation for building a culture of service excellence. Our aim is to sustain our fervor as an employer of choice and we have outlined our key focus areas during the year to achieve this goal. Bharti Infratel has been recognized as one of the âBest Employersâ by Aon Hewitt for the 3rd time in a row and âGreat Place To Workâ for the 1st time during FY 2016-17.
We would be celebrating 10 glorious years of our establishment this year and it was an opportune time to reassess our cultural dimensions. Our work culture ensures safety, good health, development of capabilities, quality of life and overall well-being of our employees.
Safety is viewed as a key parameter to demonstrate commitment to our people and the community at large. It is an integral part of our decision-making and is the prime consideration in all spheres of our activities. We have an effective Safety Policy in place that strives for zero fatality and prevents all workplace injuries. In order to ensure safe work practices, Cardinal Safety Rules have been framed and implemented. We also implemented the Consequence Management Matrix this year to ensure strict implementation of the Cardinal safety Rules.
We undertook various initiatives during the year advocating our vision to promote a gender diverse and inclusive environment. This was the year wherein we challenged ourselves and Industry mind-set by hiring women for unconventional roles. Women hiring for frontline roles is one such successful experiment. Gender sensitization workshops were held wherein efforts were channelized to create awareness on behaviors, language and conduct to be observed with others.
With an employee strength of nearly 1,261 (on Standalone basis) spread across our 11 circles and 74 zones, Last Mile Connect became critical to drive and uphold employee motivation, engagement and loyalty. Many connect forums, open house sessions were arranged across all locations, functions and teams last year where the employees could voice their concerns and thoughts, the teams were recognized for their efforts and they were made aware of the processes and policies.
This year we yet again worked with renewed focus and enthusiasm to recognize our employees who are contributing to the success of organization. We introduced several new category of awards to encourage the managers to strengthen the culture of recognition in their teams. This profound culture of recognition has inadvertently become the stepping stone for strengthening the culture of performance in the organization.
Employees Stock Option Plan
To retain, promote and motivate the best talent in the Company and to develop a sense of ownership among employees, the Company has instituted two ESOP schemes
i.e. Employee Stock Option Scheme 2008 (ESOP Scheme 2008) and Employee Stock Option Scheme 2014 (ESOP Scheme 2014) with the approval of shareholders. The said schemes are in compliance with the SEBI (Share based Employee Benefits) Regulation, 2014 (ESOP Regulations). The HR, Nomination and Remuneration Committee monitors the Companyâs ESOP schemes.
In accordance with the ESOP Regulations, the Company had set up Bharti Infratel Employeesâ Welfare Trust (ESOP Trust) for the purpose of implementation of ESOP Schemes. Both the ESOP schemes are administered through ESOP Trust, whereby shares held by the ESOP Trust are transferred to the employee, upon exercise of stock options as per the terms of the Scheme. In terms of ESOP Regulations, neither the ESOP Trust nor any of its trustees shall exercise voting rights in respect of the shares of the Company held by the ESOP Trust.
During FY 2016-17, Company has granted 105,239 stock options under LTI Plan 2015 read with ESOP Scheme 2014. A detailed report with respect to options exercised, vested, lapsed, exercise price, vesting period etc. under ESOP Scheme 2008 and ESOP Scheme 2014 is disclosed on the website of the Company at http://www.bharti-infratel.com/ cps-portal/web/shares.html.
A certificate from M/s S.R. Batliboi & Associates LLP, Chartered Accountants, Statutory Auditors, with respect to ESOP Scheme 2008 and ESOP Scheme 2014 would be placed before the shareholders at the ensuing AGM and a copy of the same will also be available for inspection at the registered office of the Company.
Auditors and Auditorsâ Report Statutory Auditors
Under Section 139 of the Companies Act, 2013, and the rules made there under, it is mandatory to rotate the Statutory Auditors on completion of the maximum term permitted under the said section. S. R. Batliboi & Associates, LLP, Chartered Accountants, shall be completing their tenure as the Companyâs Statutory Auditors and shall hold office till the conclusion of ensuing 11th AGM.
On the recommendation of the Audit & Risk Management Committee, the Board, in its meeting held on May 8, 2017 subject to the approval of the shareholders has recommended the appointment of Deloitte Haskins & Sells LLP, Chartered Accountants, (firm registration number 117366W-W100018) (âDeloitteâ) as the Statutory Auditors of the Company. Deloitte will hold office for a term of five consecutive years i.e. from the conclusion of ensuing 11th AGM till the conclusion of 16th AGM to be convened in the year 2022, subject to ratification by the members at every AGM. Accordingly, the appointment of Deloitte as the Companyâs Statutory Auditors, is placed for approval of the members. The Company has received a certificate from Deloitte to the effect that their appointment, if made, shall be in accordance with the provisions of Section 141 of the Companies Act, 2013. The first year of audit will be of the financial statements for the year ending March 31, 2018, which will include the audit of the quarterly financial statements for the year.
Auditorâs Report
The Board has duly examined the Statutory Auditorâs Report on the Standalone and Consolidated Financial Statements of the Company for the financial year ended March 31, 2017 by M/s S. R. Batliboi & Associates LLP, which is self-explanatory. The report does not contain any observations, disclaimer, qualification or adverse remarks.
Further, no fraud has been reported by the Statutory Auditorsâ in terms of Section 143(12) of the Companies Act, 2013 during the year.
Secretarial Auditor & their Report
The Company had appointed M/s. Chandrasekaran Associates, Company Secretaries, New Delhi, to conduct its Secretarial Audit for the financial year ended March 31, 2017. The Secretarial Auditor has submitted its Report, confirming compliance by the Company of all the provisions of applicable corporate laws. The Report does not contain any qualification, observation, disclaimer or adverse remark. The Secretarial Audit Report for FY 2016-17 is annexed as Annexure D to this report.
The Board has reappointed M/s. Chandrasekaran Associates, Company Secretaries, New Delhi, as Secretarial Auditor of the Company for FY 2017-18.
Corporate Social Responsibility
With each passing year, our CSR project beneficiaries have become a part of our larger family of stakeholders. It is encouraging to see how our support can change the life and empower the marginalized, be it children - especially girl child living in rural areas, unskilled women in urban slums, unemployed youth awaiting economic opportunities and people with disabilities who seek inclusion in the mainstream. Our work towards social development through CSR encompasses much more than social outreach programmes. We also maintain and align our business processes and goals to make a more deep-rooted impact on the societyâs sustainable development.
In accordance with the requirements of Section 135 of the Companies Act, 2013, the Company has constituted a CSR Committee. The composition and terms of reference of the CSR Committee is provided in the Report on Corporate Governance, which forms part of this Report.
The Company has also formulated a Corporate Social Responsibility Policy, which is available on the Companyâs website at http://www.bharti-infratel.com/cps-portal/web/ pdf/Corporate%20Social%20Responsibility%20Policy.pdf.
The Company is committed to increase its CSR impact over the years and has added few new projects during the year under review. On the recommendation of the CSR Committee and the Board, in addition to the CSR contribution of Rs, 171.18 Mn under Section 135 of Companies Act, 2013, the Company has also contributed Rs, 50 Mn to Bharti Foundation for promotion of education of underprivileged children under Section 35AC of the Income Tax Act, 1961 and has contributed Rs, 3 Mn to other charitable causes, during FY 2016-17. The said contributions of Rs, 50 Mn by the Company are as prescribed under Schedule VII of the Companies Act, 2013 and represents 0.31% of the net profit before tax of the Company for last three financial years. However, since the Company has availed a benefit under Section 35AC of Income Tax Act, 1961, the same is treated as other contribution by the Company and not considered towards prescribed 2% CSR contribution under Section 135 of Companies Act, 2013. The consolidated contribution of the Company towards various CSR activities during FY 2016-17 is Rs, 224.18 Mn (i.e. 1.37% of net profit of last three years), which is a marginal increase of 5.05% vis-a-vis consolidated contribution of Rs, 213.40 Mn in FY
2015-16.
Being in the initial years of implementation, the Company is persistently exploring new opportunities to increase its CSR expenditure to the prescribed level. As a socially responsible company, the Company is committed to play a larger role in Indiaâs sustainable development by embedding wider economic, social and environmental objectives.
A detailed update on the CSR initiatives of the Company is provided in the Corporate Social Responsibility section, which forms part of this Annual Report.
The Annual Report on Corporate Social Responsibility u/s 135 of the Companies Act, 2013 is annexed as Annexure E to this Report.
Business Responsibility Report
As stipulated under the Listing Regulations, the Business Responsibility Report, describing the initiatives taken by the Company from environmental, social and governance perspective forms a part of this Annual Report.
Management Discussion & Analysis
The Management Discussion & Analysis Report for the year under review, as stipulated under the Listing Regulations, is presented in a separate section, forming part of this Annual Report.
Corporate Governance
The Company is committed to benchmarking itself with global standards for providing good corporate governance. The Board constantly endeavors to take the business forward in such a way that it maximizes long term value for the stakeholders. The Company has put in place an effective corporate governance system which ensures that the provisions of Listing Regulations are duly complied with.
A detailed report on the corporate governance pursuant to the requirements of Listing Regulations forms part of this Annual Report.
A certificate from the auditors of the Company, M/s S. R. Batliboi & Associates LLP Chartered Accountants, confirming compliance of conditions of corporate governance as stipulated in Listing Regulations is annexed as Annexure F to this report.
Risk Management
Risk management is embedded in Bharti Infratelâs operating framework. The Company believes that risk resilience is key to achieving higher growth. To this effect, there is a robust process in place to identify key risks across the Company and prioritize relevant action plans to mitigate these risks. Risk Management framework is reviewed periodically by the Board and the Audit & Risk Management Committee, which includes discussing the management submissions on risks, prioritizing key risks and approving action plans to mitigate such risks.
The Company has duly approved a Risk Management Policy. The objective of this Policy is to have a well-defined approach to risk. The policy lays down broad guidelines for timely identification, assessment and prioritization of risks affecting the Company in the short and foreseeable future. The Policy suggests framing an appropriate response action for the key risks identified, so as to make sure that risks are adequately addressed or mitigated.
The Internal Audit function is responsible to assist the Audit & Risk Management Committee on an independent basis with a complete review of the risk assessment and associated management action plans.
Operationally, risk is being managed at the top level by Executive Committee, chaired by the Managing Director & CEO and at operating level by Executive Committees of Circles headed by Circles Business Head.
Detailed discussion on Risk Management forms part of Management Discussion & Analysis under the section âRisks and Concernsâ, which forms part of this Annual Report. At present, in the opinion of the Board of Directors, there are no risks which may threaten the existence of the Company.
Internal Financial Controls and their adequacy
The Company has established a robust framework for internal financial controls. The Company has in place adequate controls, procedures and policies, ensuring orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial information. During the year, such controls were assessed and no reportable material weaknesses in the design or operation were observed. Accordingly, the board is of the opinion that the Companyâs internal financial controls were adequate and effective during FY 2016- 17. The Internal financial controls of the Company have been further discussed in detail in the Management Discussion and Analysis section.
Vigil Mechanism
The Code of Conduct and Vigil Mechanism of the Company is available on the Companyâs website at www.bharti-infratel.com.
A brief note on the highlights of the Ombudsperson Policy and compliance with Code of Conduct is also provided in the Report on Corporate Governance which forms part of this Annual Report.
Quality Control
Quality control has been one of the prime forces behind customer delight through achievement of highest uptime and lowest energy cost across our footprint.
We have been consistently upgrading our quality strategies in line with our vision of ensuring First Time Right. Multipronged strategies have been adopted to strengthen the quality process including pre-dispatch inspection of all major material, on-site inspection during installation work in progress, quality audits post completion of work, preventive maintenance audits to ensure appropriate controls, process orientation and control of designs, materials, and workmanship at site, operations and maintenance throughout the lifecycle.
This year too we have initiated further steps towards everlasting quality journey in the form of:
1. Integration of Tablets with Infratelâs Central IT system to ensure flawless data analytics and quick turnaround time.
2. As Built Drawing creation along with regular Preventive Maintenance Audit activity to ensure reproduction of site conditions for tabletop analytics without any cost to ensure timely Up gradation /necessary corrections.
3. Maintenance process for tower and civil structures has been further strengthened to ensure optimized utilization of assets throughout their design life.
Through our quality control effort we continue to ensure optimum utilization of equipment throughout designed lives thus ensuring lower costs, lower network outages and improved margins for both, operators and us.
Other Statutory Disclosures Related Party Transactions
A detailed note on procedure adopted by the Company in dealing with contracts and arrangements with Related Parties is provided in the Report on Corporate Governance, which forms part of this Annual Report.
All arrangements / transactions entered by the Company with its Related Parties during the year were in ordinary course of business and on an armâs length basis. Particulars of material related party transactions are given in form AOC-2 as Annexure G to this report.
Names of Related Parties and details of transactions with them under Ind AS - 24 have been included in Note no. 40 of the standalone financial statements for the year ended March 31, 2017 on page no. 269.
The Policy on the Related Party Transactions is available on the Companyâs website.
Significant and material orders
There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Companyâs operations in future.
Material changes and commitments affecting financial position between the end of financial year and date of the report
There are no material changes and commitments affecting the financial position of the Company between the end of financial year and date of the report.
Particulars of loans, guarantees or investments
The details of loans given, investments made or guarantees given are provided in Note no. 7 and 14 of the Standalone financial statements for the year ended March 31, 2017.
Particulars of Employees
Disclosures relating to remuneration of Directors u/s 197(12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure H to this report.
The information as required to be provided in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure I to this report.
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo
The details of energy conservation, technology absorption and foreign exchange earnings and outgo as required under Section 134(3) of the Companies Act, 2013, read with the Rule 8 of Companies (Accounts of Companies) Rules, 2014 is annexed herewith as Annexure J to this report.
Disclosure under Section 197(14) of Companies Act, 2013
Neither the Managing Director & CEO nor the Whole-time Director of the Company receive any remuneration or commission from its holding or subsidiary Company.
Extract of Annual Return
In terms of provisions of Section 92, 134(3)(a) of the Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules, 2014, the extracts of Annual Return of the Company in form MGT-9 is annexed as Annexure K to this report.
Directorsâ Responsibility Statement
Pursuant to Section 134(5) of the Companies Act, 2013, the Directors to the best of their knowledge and belief confirm that:
I. I n the preparation of the annual accounts for the year ended March 31, 2017, the applicable accounting standards had been followed and there is no material departure from the same;
II. The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year ended March 31, 2017 and of the profit of the Company for the year ended on that date;
III. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
IV. The Directors had prepared the annual accounts on a âgoing concern basisâ;
V. The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively;
VI. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.
Acknowledgements
The Directors wish to place on record their appreciation for the assistance and co-operation extended by customers, strategic investors, bankers, vendors, business partners, various agencies and departments of Government of India and State governments where Companyâs operations are existing, supporting the Companyâs various projects.
The Directors would also like to place on record their sincere appreciation for the valuable contribution, unstinted efforts and the spirit of dedication shown by the employees of the Company at all levels in ensuring an excellent all round operational performance.
For and on behalf of the board
Rajan Bharti Mittal D S Rawat
Date: May 8, 2017 Director Managing Director & CEO
Place: New Delhi (DIN: 00028016) (DIN:06798626)
Mar 31, 2016
Dear Members,
The Directors are pleased to present the Tenth Board''s Report on the
business and operations of the Company together with the audited
financial statements for the financial year ending March 31, 2016.
Business Overview
Bharti Infratel is a provider of tower and related infrastructure
sharing services. On a consolidated basis, we are one of the largest
PAN India tower infrastructure providers, based on the number of towers
owned and operated by Bharti Infratel and Indus Towers, which are
represented by Bharti Infratel''s 42% equity interest in Indus Towers.
The business of Bharti Infratel and Indus Towers is to acquire, build,
own and operate towers and related infrastructure. Bharti Infratel and
Indus Towers provide access to their towers primarily to wireless
telecommunication service providers on a shared basis under long-term
contracts. Our three largest customers are Bharti Airtel (together with
Bharti Hexacom), Vodafone India and Idea Cellular, which are the three
leading wireless telecommunication service providers in India by
wireless revenue.
We have a nationwide presence with operations in all 22
telecommunication circles in India, with Bharti Infratel and Indus
Towers having operations in 4 overlapping circles.
As of March 31, 2016, Bharti Infratel owned and operated 38,458 towers
with 81,632 co-locations in 11 telecommunication circles while Indus
Towers operated 119,881 towers with 270,006 co-locations in 15
telecommunication circles. With Bharti Infratel''s towers and its 42%
interest in Indus Towers, we have an economic interest in the
equivalent of 88,808 towers and 195,035 co-locations in India as of
March 31, 2016.
We have entered into Master Service Agreements (MSAs) with our
customers. The MSAs are long-term contracts which set out the terms on
which access is provided to Bharti Infratel''s and Indus''s Towers, with
all service providers being offered substantially the same terms and
receiving equal treatment at towers where they have installed their
active infrastructure. Under the MSAs, Bharti Infratel and Indus Towers
enter into service contracts in respect of individual towers. The MSAs
and service contracts govern Bharti Infratel''s and Indus''s relationship
with their customers, the services provided, the applicable charges and
incorporate annual escalation clauses in respect of the applicable
charges. This provides stability to our business and provides
visibility with regard to future revenues.
Financial Highlights
A. Consolidated financial results as per Indian Generally Accepted
Accounting Principles
(Rs. Millions)
Year ended Year ended
March 31, 2016 March 31, 2015
Revenue1 123,084 116,683
EBITDA 54,031 50,108
Profit before Tax 36,207 30,515
Profit after Tax 23,820 19,924
1Revenue & EBITDA are excluding other income
B. Standalone financial results as per Indian Generally Accepted
Accounting Principles
(Rs. Millions)
Year ended Year ended
March 31, 2016 March 31, 2015
Revenue1 55,957 53,889
EBITDA 25,378 24,007
Profit before Tax 19,843 32,737
Profit after Tax 13,234 27,252
1Revenue & EBITDA are excluding other income
Share Capital
During the year, the Company has allotted 2,897,776 equity shares under
the ESOP Scheme 2008. Thus, the paid up share capital of the Company
has increased from Rs. 18,937,692,930 to Rs. 18,966,670,690 represented
by 1,896,667,069 equity shares of Rs. 10 each fully paid up as on March
31, 2016.
Transfer to Reserves
The Company has not transferred any amount to the General Reserve for
the financial year ended March 31, 2016.
Dividend
The Board has recommended a dividend of Rs. 3 per equity share of Rs.
10 each fully paid up (30% of face value) for FY 2015-16 amounting to
Rs. 5,690 Mn (excluding tax on dividend).
The payment of dividend is subject to the approval of the shareholders
at the ensuing annual general meeting of the Company.
Material Changes and Commitment Affecting the Financial Position
Between the End of the Financial Year and Date of Report of the Balance
Sheet
Buy-Back of Equity Shares
The Board of Directors, at its meeting held on April 26, 2016, approved
the Buy-back of fully paid-up equity shares of the Company (''Equity
Shares'') at a price not exceeding Rs. 450/- per Equity Share payable in
cash for a total consideration not exceeding Rs. 2,000 Crores (Rupees
Two Thousand Crores Only) excluding transaction costs viz. brokerage,
applicable taxes such as securities transaction tax, service tax, stamp
duty, etc., which is 19.3% of the total paid-up equity capital and free
reserves as per the audited financial statement of the Company for the
financial year ended March 31, 2016, through the Tender Offer route.
The Buy-back is subject to regulatory and other approvals, if any,
including the shareholders'' approval by way of special resolution
through Postal Ballot.
The Board has authorised the Committee of Directors to finalise the
terms of Buy-back and administer the Buy-back procedure.
Deposits
The Company has not accepted any deposit and as such, no amount of
principal or interest was outstanding as on the date of balance sheet.
Details of Utilisation of IPO Proceeds
Pursuant to the Initial Public Offer in December, 2012, the Company has
received Rs. 31,657 Mn (net of selling shareholders'' proceeds). The
Company had, in terms of Prospectus, proposed to utilise the IPO
Proceeds towards objects of the Issue by March 31, 2016. Whilst the
Company had made best efforts to utilise the IPO proceeds as per the
terms of the Issue, Rs. 9,403 Mn was pending utilisation as on December
31, 2015 for which the Company has obtained approval of the
shareholders'' by way of special resolution through Postal Ballot for
variation in terms of the Objects of the Issue.
For details of utilisation of IPO proceeds subsequent to approval of
the shareholders'', please refer note no. 39 of the standalone financial
statements for the year ended March 31, 2016 on page 224.
Directors and Key Managerial Personnel
Inductions, Re-appointments, Retirements & Resignations
In line with the Company''s policy on Independent Directors, Mr. Vinod
Dhall has retired from the Board w.e.f. September 2, 2015. Further,
during the previous financial year, Mr. Rakesh Bharti Mittal,
Non-Executive Director resigned from the Board w.e.f. January 27, 2016.
The Board placed on record its'' sincere appreciation for help, guidance
and contribution made by the outgoing Directors during their tenure on
the Board.
Mr. Rajan Bharti Mittal was appointed as a Non-Executive Additional
Director on the Board w.e.f. January 27, 2016. The Company has
received requisite notice from a member under Section 160 of the
Companies Act, 2013, along with deposit of Rs. 1,00,000/- proposing the
appointment of Mr. Rajan Bharti Mittal as the Company''s Non-Executive
Director, liable to retire by rotation at the ensuing AGM.
Pursuant to the provisions of the Companies Act, 2013, Mr. Mark Chin
Kok Chong, Director of the Company, is liable to retire by rotation at
the forthcoming AGM and being eligible, has offered himself for
re-appointment.
A brief resume, nature of expertise, details of other directorships and
other information of the Directors proposed to be appointed/
re-appointed as stipulated in Secretarial Standard 2 and Regulation 36
of the Listing Regulations is appended as an annexure to the notice of
ensuing AGM.
During the year, Mr. R P Singh was appointed as an Independent Director
on the Board w.e.f. July 15, 2015 and his tenure was fixed by the
members at the last AGM held on August 11, 2015.
Mr. Anupam Garg, Company Secretary has resigned w.e.f. July 22, 2015.
The Directors placed on record their appreciation for the contribution
made by him during his tenure. The Board in its meeting held on July
22, 2015 has appointed Ms. Shweta Girotra as the Company Secretary and
Compliance Officer of the Company w.e.f. July 23, 2015.
Declaration by Independent Directors
The Company has received declarations from all the Independent
Directors of the Company confirming that they meet with the criteria of
independence as prescribed under Section 149 of the Companies Act, 2013
and the Listing Regulations. The Independent Directors have also
confirmed that they have complied with the Company''s code of conduct.
Policy on Nomination, Remuneration and Board Diversity
The Company believes that building a diverse and inclusive culture is
integral to its success. A diverse Board, among others, will enhance
the quality of decisions by utilising different skills, qualifications,
professional experience and knowledge of the Board members necessary
for achieving sustainable and balanced development. Accordingly, the
Board has adopted a Policy on Nomination, Remuneration and Board
Diversity, which sets out the criteria for determining qualifications,
positive attributes and independence of a Director. The detailed policy
is available on the Company''s website at www.bharti-infratel.com and is
annexed as Annexure A to this report.
Annual Board Evaluation and Familiarisation Programme for Board Members
A note on the familiarisation programme adopted by the Company for
orientation and training of the Directors, and the Board evaluation
process undertaken in compliance with the provisions of the Companies
Act, 2013 and the Listing Regulations is provided in the Report on
Corporate Governance, which forms part of this Annual Report.
Board Meetings
During FY 2015-16, the Board of Directors met 4 (four) times on April
27, 2015; July 22, 2015; October 23, 2015 and January 27, 2016. The
period between any two consecutive meetings of the Board of Directors
of the Company was not more than 120 days.
The details regarding composition, number of board meetings held and
attendance of the Directors during FY 2015-16 are set out in the Report
on Corporate Governance, which forms part of this Annual Report.
Board Committees
The Company has several Committees which have been established as a
part of the best corporate governance practices and are in compliance
with the requirements of the relevant provisions of applicable laws and
statutes. As on March 31, 2016, the Board has 5 Committees, namely,
Audit and Risk Management Committee; HR, Nomination and Remuneration
Committee; Corporate Social Responsibility (CSR) Committee;
Stakeholders'' Relationship Committee and Committee of Directors. The
details with respect to the compositions, powers, roles, terms of
reference, no. of meetings etc. of the Committees held during the FY
2015-16 and attendance of the Directors at each meeting is provided in
the Report on Corporate Governance which forms part of this Annual
Report.
Subsidiary / Associate and Joint Venture Company
During the FY 2015-16, Smartx Services Limited was incorporated as a
wholly owned subsidiary Company. Bharti Infratel Services Limited,
another wholly owned subsidiary Company has applied to the Registrar of
Companies for striking-off its name from the register of Companies.
Company has a joint venture in the name of Indus Towers Limited, there
was no change in the joint venture during the financial year under
review.
In accordance with Section 129(3) of the Companies Act, 2013, the
Company has prepared consolidated financial statements of the Company,
its subsidiaries and joint venture, which forms part of the Annual
Report. A statement in Form AOC - 1, containing the salient features of
the financial statements of the subsidiaries and Joint Venture Company
is annexed as Annexure B to this report. The statement also provides
the details of performance and financial position of each of the
subsidiary and joint venture.
Audited financial statements of Smartx Services Limited for FY 2015-16
and Statement of Accounts of Bharti Infratel Services Limited as on
March 30, 2016 have been placed on the website of the Company,
www.bharti-infratel.com. The audited financial statements of the
subsidiaries are available for inspection at the Company''s registered
office and registered office of respective companies. Shareholders
interested in obtaining a copy of the audited financial statements of
subsidiaries may write to the Company Secretary at the Company''s
registered office.
Human Resources
At Bharti Infratel, our workforce is fundamental to the business
strategy and its success. We venture to offer an encouraging,
empowering and engaging environment where employees are ardent towards
achieving customer excellence and realising the vision of the Company.
We commenced FY 2015-16 with an endeavour to fortify our stature as
''Employer of Choice''. In order to deliver on this agenda, we undertook
various initiatives.
In order to satisfy our jobs with continuous improvement, we launched
the concept of ''Infratel DNA'', to provide our leadership a direction
towards achieving the corporate vision. This DNA forms the anchor of
our Talent Acquisition, Performance Management, Leadership Development
and our Succession planning processes.
A second initiative was the launch of the ''Applause Online'' program,
which aims at recognising teams and individuals who deliver superior
performance with imbibed Infratel values. This portal provides real
time recognition to our human resources.
A major aspect of our success is also from the initiative of iLearn.
This is wrapped around the theme of ''Own Your Development'', where
employees have a marketplace for all their learning needs. This builds
a culture where the workforce is responsible for their career,
development and a holistic growth.
To ensure relentlessly exceeding business targets, we introduced the
''360° Feedback'', to provide a holistic feedback to our middle and
senior management. To foster the culture of safety and to ensure
compliance of safety norms, we also launched the ''Consequence
Management Guidelines''.
Finally, to take workforce diversity to a new high, we not only
organised a ''Women in Business'' Conclave, but also introduced the
initiative of ''Bits n Bytes''. This platform provides high women connect
network in all circles. We also conducted the Gender Sensitisation
Workshop for all our employees, to ensure employee integrity, at every
level.
Employees Stock Option Plan
To retain, promote and motivate the best talent in the Company and to
develop a sense of ownership among employees, the Company has
instituted two ESOP schemes i.e. Employee Stock Option Scheme 2008
(ESOP Scheme 2008) and Employee Stock Option Scheme 2014 (ESOP Scheme,
2014) with the approval of shareholders. The said schemes are in
compliance with the SEBI (Share based Employee Benefits) Regulation,
2014, (ESOP Regulations) The HR, Nomination and Remuneration Committee
administers and monitors the Company''s ESOP schemes.
During FY 2015-16, the Company has allotted 2,897,776 equity shares
pursuant to exercise of stock options under ESOP Scheme, 2008.
In accordance with the ESOP Regulations, 2014, the Company had set up
Bharti Infratel Employees'' Welfare Trust (ESOP Trust) for the purpose
of implementation of employees'' stock option schemes. Since October,
2015, both the ESOP schemes are administered through ESOP Trust,
whereby shares held by the Trust are transferred to the employee, upon
exercise of stock options as per the terms of the Scheme. In terms of
ESOP Regulations, neither the ESOP Trust nor any of its trustees shall
exercise voting rights in respect of the shares of the Company held by
the ESOP Trust.
During the year, Company has formulated LTI Plan - 2015 under ESOP
Scheme, 2014 and has granted 90,261 stock options under the said Plan.
A detailed report with respect to options exercised, vested, lapsed,
exercise price, vesting period etc. under ESOP Scheme, 2008 and ESOP
Scheme, 2014 is disclosed on the website of the Company at http://
www.bharti-infratel.com/cps-portal/web/shares.html.
A certificate from M/s S. R. Batliboi & Associates LLP Chartered
Accountants, Statutory Auditors, with respect to ESOP Scheme, 2008 and
ESOP Scheme, 2014 would be placed before the shareholders at the
ensuing AGM and a copy of the same will also be available for
inspection at the registered office of the Company.
Auditors and Auditors'' Report Statutory Auditors
In terms of the provisions of Section 139 of the Companies Act, 2013,
M/s S. R. Batliboi & Associates LLP, were appointed as the Statutory
Auditors of the Company by the shareholders in the 8th AGM held on
August 4, 2014 for a period of three years i.e. up to the conclusion of
the 11th AGM of the Company.
The said appointment is subject to ratification by the members at every
AGM. Accordingly, the Board has recommended ratification of appointment
of M/s S. R. Batliboi & Associates LLP, Chartered Accountants, by the
shareholders at the forthcoming AGM. The Company has received a letter
from M/s S. R. Batliboi & Associates LLP, Chartered Accountants,
confirming their consent and eligibility under Section 139 and 141 of
the Companies Act, 2013.
Auditors'' Report
The Board has duly examined the Statutory Auditor''s Report to the
accounts, which is self-explanatory. The report does not contain any
observations, disclaimer, qualification or adverse remarks.
Secretarial Auditors & Their Report
The Company had appointed M/s. Chandrasekaran Associates, Company
Secretaries, New Delhi, to conduct its Secretarial Audit for the
financial year ended March 31, 2016. The Secretarial Auditors have
submitted their report, confirming compliance by the Company of all the
provisions of applicable corporate laws. The Report does not contain
any qualification, observations, disclaimer or adverse remark. The
Secretarial Audit Report is annexed as Annexure C to this report.
The Board has reappointed M/s. Chandrasekaran Associates, Company
Secretaries, New Delhi, as Secretarial Auditor of the Company for the
FY 2016-17.
Corporate Social Responsibility (CSR)
At Bharti Infratel, Corporate Social Responsibility (CSR) encompasses
much more than social outreach programmes. Over the years, the Company
has aligned its business processes and goals to make a more deep-rooted
impact on the society''s sustainable development.
In accordance with the requirements of Section 135 of the Companies
Act, 2013, the Company has constituted a CSR Committee. The composition
and terms of reference of the CSR Committee is provided in the Report
on Corporate Governance, which forms part of this Report.
The Company has also formulated a Corporate Social Responsibility
Policy, which is available on the Company''s website at
http://www.bharti-infratel.com/cps-portal/web/
pdf/Corporate%20Social%20Responsibility%20Policy.pdf.
During FY 2015-16, the Company has spent Rs. 209.4 Mn. towards the CSR
activities and a balance of Rs. 45.6 Mn was left unspent. The Company
had increased/ scaled up the intervention for CSR activities as
prescribed in the Company''s CSR policy and there was an increase of
approx 22% in the total CSR spend vis-a-vis last year i.e. from Rs.
173 Mn in financial year 2014-15 to Rs. 209.4 Mn this year. As a
socially responsible company, our Company is committed to increase its
CSR impact and spend over the coming years, with its aim of playing a
larger role in India''s sustainable development by embedding wider
economic, social and environmental objectives. As the Company has added
new projects and scaled up the existing ones, there will be increased
CSR spend in coming years.
A detailed update on the CSR initiatives of the Company is provided in
the Corporate Social Responsibility section, which forms part of the
Annual Report.
The Annual Report on Corporate Social Responsibility u/s 135 of the
Companies Act, 2013 is annexed as Annexure D to this Report.
Business Responsibility Report
As stipulated under the Listing Regulations, the Business
Responsibility Report, describing the initiatives taken by the Company
from environmental, social and governance perspective forms a part of
this Annual Report.
Management Discussion and Analysis
The Management Discussion and Analysis Report for the year under
review, as stipulated under the Listing Regulations, is presented in a
separate section, forming part of this Annual Report.
Corporate Governance
Your Company is committed to benchmarking itself with global standards
for providing good corporate governance. The Board constantly
endeavours to take the business forward in such a way that it maximises
long term value for the stakeholders. The Company has put in place an
effective corporate governance system which ensures that the provisions
of the Listing Regulations are duly complied with.
A detailed report on the corporate governance pursuant to the
requirements of the Listing Regulations forms part of this Annual
Report.
A certificate from the auditors of the Company, M/s S. R. Batliboi &
Associates LLP, Chartered Accountants, confirming compliance of
conditions of corporate governance as stipulated in the Listing
Regulations is annexed as Annexure E to this report.
Risk Management
Risk management is embedded in the operating framework of Bharti
Infratel. The Company believes that managing risks goes hand in hand
with maximising returns. To this effect, there is a robust process in
place to identify key risks across the Company and prioritise relevant
action plans to mitigate these risks. Risk Management Framework is
reviewed periodically by the Board and the Audit and Risk Management
Committee which includes discussing the management submissions on
risks, prioritising key risks and approving action plans to mitigate
such risks.
The Company has a Risk Management Policy approved by Audit and Risk
Management Committee and the Board. The objective of this policy is to
have a well-defined approach to risk. The Policy lays broad guidelines
for the appropriate authority so as to be able to do timely
identification, assessment, and prioritisation of risks affecting the
Company in the short and foreseeable future. The Policy suggests
framing an appropriate response action for the key risks identified so
as to make sure that risks are adequately compensated or mitigated.
The Internal Audit function is responsible to assist the Audit and Risk
Management Committee on an independent basis with a full status of the
risk assessment and management. Detailed discussion on Risk Management
has been given as apart of Management Discussions Analysis under the
section "Risks and Concerns", which forms part of this Annual Report.
Internal Finance Control
The Company has in place a robust and comprehensive internal financial
control system for all the major financial transactions to ensure
orderly and efficient conduct of its business, including adherence to
Company''s policies and procedures, the safeguarding of its assets, the
prevention and detection of frauds and errors and reliability of
financial reporting. The Internal financial controls of the Company
have been further discussed in detail in the Management Discussion and
Analysis section.
Vigil Mechanism
The Code of Conduct and vigil mechanism of the Company is posted on the
website of the Company at www.bharti- infratel.com.
A brief note on the highlights of the Ombudsperson Policy and
compliance with Code of Conduct is also provided in the Report on
Corporate Governance which forms part of this Annual Report.
Quality Control
The Company has established well-structured quality processes and
systems at every stage of the Company''s work, from designs, materials,
and workmanship at site, operations and maintenance throughout the
lifecycle. The Company also undertake validation of passive assets,
factory testing and regular quality checks. The Company is empowering
quality team with PDA Tablets to ensure real time information and
proper documentation for effective quality control.
The Company has adopted the following quality assurance practices
stage-wise:
1. Pre-dispatch inspection of all major material such as tower
components, DG sets, battery banks, power interface equipment;
2. On-site inspection during installation work in progress;
3. Quality audits post completion of work to ensure process
completion;
4. Preventive maintenance audits during operation and maintenance of
sites to ensure timely maintenance of equipment and basic site hygiene;
and
5. Maintenance of tower and civil structures to ensure optimised
utilisation of assets throughout their design life.
The Company has a Standard Quality Process and Guidelines for civil,
tower and electrical works and a Quality Assurance Plan ("QAP") for
pre-dispatch inspection for effective material verification at vendor
premises. Regular project reviews, governance meetings and third party
audits are conducted on a regular basis in order to encourage
maintenance of quality and ensure that tower assets are strictly in
accordance with Company''s approved specifications.
These quality assurance practices enable us to maintain high
performance standards across the network, resulting in key long-term
advantages:
a. Good asset life as per specifications and designs;
b. High network uptime for customers, with fewer network outages; and
c. High levels of customer satisfaction due to hassle-free active
infrastructure installation.
Other Statutory Disclosures
Related Party Transactions
A detailed note on procedure adopted by the Company in dealing with
contracts and arrangements with Related Parties is provided in the
Report on Corporate Governance, which forms part of this Annual Report.
All arrangements / transactions entered by the Company with its related
parties during the year were in ordinary course of business and on an
arm''s length basis. Particulars of material related party transactions
are given in form AOC- 2, annexed as Annexure F to this report.
Names of Related Parties and details of transactions with them have
been included in Note no. 35 of the standalone financial statements for
the year ended March 31, 2016 under Accounting Standard 18 on page 218.
The Policy on the Related Party Transactions is available on the
Company''s website at www.bharti-infratel.com.
Significant and Material Orders
There are no significant and material orders passed by the regulators
or courts or tribunals impacting the going concern status and Company''s
operations in future.
Particulars of Loans, Guarantees or Investments
The details of loans given, investments made or guarantees given are
provided in the standalone financial statement in Note no. 12,13,15 and
18.
Particulars of Employees
Disclosures relating to remuneration of Directors u/s 197(12) of the
Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 is annexed as
Annexures G to this report.
The information as required to be provided in terms of Section 197(12)
of the Companies Act, 2013 read with Rule 5(2) of Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 is
annexed as Annexures H to this report.
Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo
The details of energy conservation, technology absorption and foreign
exchange earnings and outgo as required under Section 134(3) of the
Companies Act, 2013, read with the Rule 8 of Companies (Accounts of
Companies) Rules, 2014 is annexed as Annexure I to this report.
Extract of Annual Return
In terms of provisions of Section 92, 134(3)(a) of the Companies Act,
2013 read with Rule 12 of Companies (Management and Administration)
Rules, 2014, the extracts of Annual Return of the Company in form MGT-9
is annexed as Annexure J to this report.
Directors'' Responsibility Statement
Pursuant to Section 134(5) of the Companies Act, 2013, the Directors to
the best of their knowledge and belief confirm that:
I. In the preparation of the annual accounts for the year ended March
31, 2016, the applicable accounting standards had been followed and
there is no material departure from the same;
II. The Directors had selected such accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year ended March 31, 2016
and of the profit of the Company for the year ended on that date;
III. The Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 2013, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
IV. The Directors had prepared the annual accounts on a ''going 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 are operating effectively;
VI. The Directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems are
adequate and are operating effectively.
Acknowledgements
The Directors wish to place on record their appreciation for the
assistance and co-operation extended by customers, strategic investors,
bankers, vendors, business partners, various agencies and departments
of Government of India and State Governments where Company''s operations
are existing, supporting the Company''s various projects.
The Directors would also like to place on record their sincere
appreciation for the valuable contribution, unstinted efforts and the
spirit of dedication shown by the employees of the Company at all
levels in ensuring an excellent all round operational performance.
For and on behalf of the Board
Akhil Gupta
Date : April 26, 2016 Chairman
Place: Gurgaon DIN: 0028728
Mar 31, 2013
Dear Shareholders,
The Directors are delighted to present the Seventh Annual Report on
the business and operations of the Company together with audited
financial statement and accounts for the financial year ending March
31, 2013.
OVERVIEW
The business of Bharti Infratel Limited and Indus Towers Limited
(Indus) is to acquire, build, own and operate tower and related
infrastructure. We have a nationwide presence with operations in all 22
telecommunication circles in India, with Bharti Infratel and Indus
having operations in 4 overlapping circles.
In order to capitalize on the opportunities for tower sharing in the
Indian telecommunications market, Bharti Airtel, Bharti Infratel,
Vodafone India and Idea Cellular agreed to establish Indus as an
independently managed joint venture that provides non-discriminatory
shared tower services to all wireless telecommunication service
providers. Bharti Infratel, Vodafone India and Aditya Birla Telecom
hold 42%, 42% and 16% shareholding interest in Indus, respectively.
Subject to certain exceptions, Bharti Infratel and Indus do not compete
with each other in any telecommunication circle, they do not have any
conflicts of interest in this regard and are able to work closely with
each other and benefit from the synergies generated by the nationwide
coverage and large scale of their operations.
Bharti Infratel and Indus provide access to their towers primarily to
wireless telecommunication service providers on a shared basis, under
long-term contracts. Bharti Infratel''s and Indus'' three largest
customers are Bharti Airtel (together with Bharti Hexacom), Vodafone
India and Idea Cellular, which are the three leading wireless
telecommunication service providers in India by wireless revenue.
On a consolidated basis, we are one of the largest tower infrastructure
providers in India, based on the number of towers that Bharti Infratel
owns and operates and the number of towers owned or operated by Indus,
that are represented by Bharti Infratel''s 42% equity interest in Indus.
As of March 31, 2013, Bharti Infratel owned and operated 35,119 towers
with 63,573 co-locations in 11 telecommunication circles while Indus
operated 111,819 towers with 221,511 co-locations in 15
telecommunication Circles. With Bharti Infratel''s towers and Bharti
Infratel''s 42% interest in Indus, we have an economic interest in the
equivalent of 82,083 towers and 156,608 co-locations in India as of
March 31, 2013.
Your Company achieved success during the year in gaining its share of
the market from all leading telecom operators in its circles of
operations, despite several regulatory and business developments, which
impacted the telecom industry. The Company observed significant
improvement in network uptime delivery during the year, recording the
highest ever uptime.
The directors are pleased to inform that the Customer Satisfaction
Scores, based on an independent survey, reflect that the Company has
excelled on all customer satisfaction aspects as is evident from the
higher customer satisfaction scores. Our Network Health Report, a
monthly update on overall health of the network, is well received and
appreciated by most customers.
On May 31, 2011, the Subsidiary Company "Bharti Infratel Ventures
Limited" filed a ''Scheme of Arrangement'' before Hon''ble High Court of
Delhi whereby the Subsidiary Company will merge with Indus, with
appointed date as April 1, 2009. The Hon''ble High Court of Delhi vide
its order dated April 18, 2013 has sanctioned the said Scheme of
Arrangement. The Scheme will be effective on filing the Hon''ble High
Court''s order with Registrar of Companies (RoC).
FINANCIAL RESULTS AND RESULTS OF OPERATION
Financial highlights of operations of the Company as on March 31, 2013
are as follows:
A. Consolidated financial results as per Indian Generally Accepted
Accounting Principles
(Figures in Rs. Mn)
Particulars Year ended Year ended
March 31, 2013 March 31, 2012
Revenue1 102,720 94,521
EBITDA1 38,354 35,344
Profit before Tax 15,307 11,282
Profit after Tax 10,025 7,491
1 Revenue and EBITDA are excluding other income.
B. Standalone financial results as per Indian Generally Accepted
Accounting Principles
Particulars Year ended Year ended
March 31, 2013 March 31, 2012
Revenue1 44,601 41,582
EBITDA1 17,772 16,356
Profit before Tax 13,216 6,867
Profit after Tax 10,098 4,492
1 Revenue and EBITDA are excluding other income.
GENERAL RESERVE
Out of the total profit of Rs. 10,098 Mn on a standalone basis of
Bharti Infratel Limited for the financial year ended March 31, 2013, an
amount of Rs. 2,426 Mn has been transferred to the General Reserve.
DIVIDEND
The Board has recommended a final Dividend of Rs. 3.00 per equity share
of the face value of Rs. 10 each fully paid up (i.e. 30%) for the
financial year 2012-13, amounting to Rs. 6,629 Mn (inclusive of Rs. 963
Mn as tax on Dividend). The payment of dividend is subject to the
approval of the shareholders at the ensuing annual general meeting of
the Company. The Company has paid interim dividend(s) on September 7,
2012 @ Rs. 2.50 per equity share of Rs. 10 each fully paid up
comprising of:
a. dividend of Rs. 1.50 per equity share of Rs. 10 each fully paid up
(i.e. 15%), amounting to Rs. 3,038 Mn (inclusive of Rs. 424 Mn as tax
on Dividend) out of the accumulated profits earned up to March 31, 2012
and
b. dividend of Rs. 1.00 per equity share of Rs. 10 each fully paid up
(i.e. 10%), amounting to Rs. 2,025 Mn (inclusive of Rs. 283 Mn as tax
on Dividend) out of profits of the Company for the current year i.e. FY
2012-13.
SHARE CAPITAL
During the year, the share capital of your Company was altered as
follows:
a. The authorised share capital was increased from Rs. 6 Bn to Rs. 35
Bn by creation of 2.90 Bn equity shares of Rs. 10 each.
b. 1,161,605,820 equity shares of Rs. 10 each were allotted on August
23, 2012 as Bonus shares in the ratio of 2:1.
c. 146,234,112 equity shares of Rs. 10 each were allotted on December
22, 2012 under the initial public offering at a premium of Rs. 210.90.
d. 100,212 equity shares of Rs. 10 each were allotted on March 19,
2013 under the ESOP scheme at a premium of Rs. 99.67.
e. Consequent to above, the paid up share capital of the Company has
increased from Rs. 5,808,029,100 to Rs. 18,887,430,540 represented by
1,888,743,054 equity shares of Rs. 10 each.
INITIAL PUBLIC OFFER
Bharti Infratel has listed its equity shares on the NSE and BSE in
India on Friday, December 28, 2012. The issue, comprising of 146.23 Mn
fresh equity shares and 42.67 Mn equity shares on offer for sale (OFS)
by the selling shareholders, opened for subscription during December
11-14, 2012 was oversubscribed 1.26 times. The reserved portion of
Qualified Institutional Buyers (QIBs) was oversubscribed 2.84 times.
The Company raised Rs. 32,303 Mn from the public issue excluding Rs.
9,425 Mn pertaining to the OFS by the selling shareholders, namely
Compassvale Investments Pte. Ltd., GS Strategic Investments Limited,
Anadale Limited and Nomura Asia Investment (IB) Pte. Ltd.
The Company intends to use issue proceeds from the IPO for the
installation of new towers, upgradation and replacement on existing
towers, green initiatives at tower sites and general corporate
purposes.
Bharti Infratel has been included in the FTSE Global Equity Indices
starting January 7, 2013. Bharti Infratel was added to FTSE All-World
Index (Large Cap) with an investability weighting of 9% and also to
FTSE All-Emerging Index.
FTSE''s flagship global benchmark, the FTSE All-World, is used by
investors worldwide to structure and benchmark their international
equity portfolios. The FTSE global equity universe covers over 7,400
securities in 47 different countries and captures 98% of the world''s
investable market capitalization.
The stock has also been shifted from category B to category A Stock of
BSE.
FIXED DEPOSITS
The Company has not accepted any fixed deposits and, as such, no amount
of principal or interest was outstanding as of the date of Balance
Sheet.
SUBSIDIARY COMPANY
As on March 31, 2013, the Company has one wholly owned subsidiary
(100%), viz, Bharti Infratel Ventures Limited. The statement of
Company''s interest in its wholly owned subsidiary, Bharti Infratel
Ventures Limited under Section 212(1)(e) of the Companies Act, 1956 is
annexed herewith and forms part of the Directors'' Report.
Pursuant to General Circular No. 2/2011 dated February 8, 2011 issued
by the Ministry of Corporate Affairs, Government of India, the Board of
Directors have consented for not attaching the balance sheet, statement
of profit & loss and other documents as set out in section 212(1) of
the Companies Act, 1956 in respect of its subsidiary company for the
year ended March 31, 2013. The statement pursuant to the circular is
annexed as part of the notes to the consolidated accounts of the
Company on page 121 of the Annual Report.
Annual accounts of the subsidiary, along with related information are
available for inspection at the Company''s registered office. Copies of
the annual accounts of the subsidiary company will also be made
available to the Company''s investors upon request.
AUDITORS
The Statutory Auditors of the Company M/s. S.R. Batliboi & Associates
LLP (formerly known as M/s. S.R. Batliboi & Associates), Chartered
Accountants shall retire at the conclusion of forthcoming annual
general meeting. They have given the Company a notice regarding their
unwillingness to be reappointed.
M/s. S.R. Batliboi & Co. LLP, Chartered Accountants, have given their
consent to act as statutory auditors of the Company and a certificate
confirming therein that their appointment, if made, will be within the
limits prescribed u/s 224(1B) of the Companies Act, 1956 has been
received from them.
M/s. S.R. Batliboi & Co. LLP, Chartered Accountants, is an independent
audit firm and none of your directors are related or interested in it,
whether directly or indirectly.
AUDITORS'' REPORT
The Board has duly examined the statutory auditors'' report on accounts
and clarifications, wherever necessary, have been included in the Notes
to Accounts section of the Annual Report.
As regards the comment under para xxi of the annexure to the
independent auditors'' report to address the issues of fraud pertaining
to electricity payments and asset pilferage, the company has taken
appropriate steps including legal action against the external parties
involved etc. The Company is further strengthening its internal control
systems to reduce the probability of occurrence of such events in
future.
SECRETARIAL AUDIT REPORT
Keeping with the high standards of corporate governance adopted by the
Company and also to ensure proper compliance with the provisions of
various corporate laws, the regulations and guidelines issued by the
Securities and Exchange Board of India and the listing agreement, the
Company has voluntarily started Secretarial Audit from a practicing
company secretary firm.
M/s. Chandrasekaran Associates have been conducting the Secretarial
Audit of the Company on continuous basis. They have submitted their
report confirming the compliances with all the applicable provisions of
various corporate laws. The Secretarial Audit Report is provided
separately in the Annual Report.
DIRECTORS
Pursuant to the provisions of the Companies Act, 1956, Mr. Akhil Gupta,
Director of the Company, is liable to retire by rotation at the
forthcoming annual general meeting and being eligible, offers himself
for re-appointment. Further, the term of Mr. Akhil Gupta as Managing
Director will expire on July 31, 2013. Your Board, based on the
recommendations of the HR & ESOP Compensation Committee, proposes the
re-appointment of Mr. Akhil Gupta for a further period of 5 years as
per the terms and conditions mentioned in the Notice of ensuing annual
general meeting and in terms of the articles of association of the
Company. Mr. Akhil Gupta would not be liable to retire by rotation.
Since the date of last Directors'' Report Mr. Rakesh Bharti Mittal, Mr.
Bharat Sumant Raut, Mr. Jitender Balakrishnan, Mr. Vinod Dhall and Mr.
Sanjay Nayar were appointed w.e.f. September 3, 2012 and Mr. Murray
Philip King and Ms. Leena Srivastava were appointed w.e.f. November 5,
2012 as additional director(s) of the Company to hold office up to the
date of forthcoming annual general meeting.
The Company has received notices under section 257 of the Companies
Act, 1956 proposing the appointment of Mr. Rakesh Bharti Mittal, Mr.
Bharat Sumant Raut, Mr. Jitender Balakrishnan, Mr. Vinod Dhall, Mr.
Sanjay Nayar, Mr. Murray Philip King and Ms. Leena Srivastava as
Director(s) liable to retire by rotation.
Your Board recommends their appointment/ re-appointment at the ensuing
annual general meeting.
A brief resume, nature of expertise, details of directorships held in
other public limited companies and other information of the directors
proposing appointment/re-appointment pursuant to clause 49 of the
Listing Agreement with the Stock Exchanges is appended as an annexure
to the notice of ensuing annual general meeting.
Mr. Sunil Bharti Mittal, Mr. Rohit Sipahimalani and Mr. Inder Walia
resigned from the Board on September 3, 2012. The Board places on
record its sincere appreciation for the guidance rendered by Mr.
Mittal, Mr. Sipahimalani and Mr. Walia.
CORPORATE GOVERNANCE
Your Company is committed to benchmarking itself with global standards
for providing good corporate governance. The Chairman and Directors
constantly endeavour to take the business forward in such a way that it
maximizes long term value for the stakeholders. The Company has put in
place an effective corporate governance system which ensures that the
provisions of Clause 49 of the listing agreement are duly complied
with.
A detailed report on the corporate governance pursuant to the
requirements of clause 49 of the listing agreement forms part of the
Annual Report. A certificate from the auditors of the Company, M/s. S.
R. Batliboi & Associates LLP, Chartered Accountants, confirming
compliance of conditions of corporate governance as stipulated in
Clause 49 is annexed to the report as Annexure A.
BOARD COMMITTEES AND ITS COMPOSITION
In accordance with the listing agreement requirements, the details of
the Board committees are presented as part of the Corporate Governance
Report.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
At Bharti Infratel, CSR is a way of life and is well integrated with
our business strategy. Detailed information on the initiatives of the
Company towards CSR activities is provided in the Corporate Social
Responsibility section of the Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In accordance with the listing agreement requirements, the Management
Discussion and Analysis report is presented in a separate section
forming part of the Annual Report.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The statement as required under Section 217(1)(e) of the Companies Act,
1956 read with the Companies (Disclosure of Particulars in the report
of the Board of Directors) Rules, 1988 as amended is given in Annexure
B to this report.
HUMAN RESOURCES
At Bharti Infratel, we strongly believe that employee engagement is a
key pillar towards building organisational effectiveness. The primary
objective of achieving a high employee engagement is to create passion
in all that we do and enable the workforce towards meeting and
surpassing the performance expectations, leading to long-term success.
We strongly believe that our people are our competitive advantage and
the key to shaping our future.
Our people embody our core values and define who we are. We have 1,256
on roll employees on a standalone basis.
The Company believes in the values of pioneering, service orientation &
continuous improvement, positive, passionate & involved and respect &
fairness for all stakeholders aligned to the vision. To facilitate
leadership development and groom individuals for larger leadership
roles, the Company has developed a robust Leadership Competency
Framework which defines the essential competencies and behavioural
manifestations that are required for future development planning.
EMPLOYEES STOCK OPTION PLAN
Employees continue to be the key driving force of the organization and
remain a strong source of our competitive advantage. Therefore, to
develop a sense of ownership among the employees within the
organization, the Company instituted an employee stock option scheme
namely Employee Stock Option Scheme 2008 ("ESOP Scheme 2008"). The
objective of ESOP Scheme 2008 is employee engagement and long term
retention by providing employees of the Company an opportunity to
participate in the Company''s anticipated valuation enhancement by
contributing to superior performance and shareholder returns. The
Company undertook a bonus issue of equity shares in the ratio of two
equity shares for every one equity share held on August 23, 2012.
Pursuant to the adjustment made as a result of this bonus issue, the
total number of options that can be granted under ESOP Scheme 2008 is
16,215,000.
During the year under review, 100,212 equity shares were allotted to
the employees upon exercise of stock options.
Disclosure in compliance with clause 12 of the Securities and Exchange
Board of India (Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999, as amended, is provided in Annexure
C to this report.
A certificate from M/s. S.R. Batliboi & Associates LLP, Chartered
Accountants, Statutory Auditors, with respect to the ESOP Scheme 2008
would be placed before the shareholders at the ensuing annual general
meeting and a copy of the same will also be available for inspection at
the registered office of the Company.
PARTICULARS OF EMPLOYEES
The information as required to be provided in terms of section 217(2A)
of the Companies Act, 1956 read with Companies (Particulars of
Employees) Rules, 1975 have been set out in Annexure D to this report.
QUALITY CONTROL
Your Company has established well structured quality processes and
systems at every stage of its work, from designs, materials,
workmanship at site, operations and maintenance through the entire
lifecycle of the towers and related services. The Company has adopted
the following stage-wise quality assurance practices:
- pre-dispatch inspection of all major material such as tower
components, DG sets, shelters and battery banks;
- on-site inspection during works in progress such as civil,
electrical and tower installation works;
- quality audits post completion of works to ensure process
completion; and
- preventive maintenance audits during operation and maintenance of
sites to ensure timely maintenance of equipment and basic site hygiene.
Your Company has a Standard Quality Process and Guidelines for civil,
tower and electrical works and a Quality Assurance Plan ("QAP") for
pre-dispatch inspection for effective material verification at vendor
premises. Regular project reviews, governance meetings and third party
audits are conducted on a regular basis in order to encourage
maintenance of quality and ensure that towers are strictly in
accordance with Company''s approved specifications.
These quality assurance practices enable us to maintain high
performance standards across the network, resulting in key long-term
advantages:
- good asset life as per specifications and designs;
- high network uptime for customers, with fewer network outages; and
- high levels of customer satisfaction due to hassle-free active
infrastructure installation.
AWARDS & RECOGNITION
Recognising our strong business leadership within the telecom tower
infrastructure space and our world-class service delivery, your Company
was awarded the Top Infrastructure Company Award in the Telecom
Infrastructure category at Dun & Bradstreet - Axis Bank Infra Awards
2012, for the second year in a row.
The Company was conferred the CIO 100 Efficient Enterprise Special
Awards 2012 for using information technology in innovative ways to
deliver business value, create competitive advantage, optimize business
processes and enable overall growth.
Your Company won the PCQUEST Best IT Implementation of The Year Award
2012 for implementing Infratel Enterprise Suite (IES) that was designed
to automate and align business processes within six value streams in
the organization.
For enabling rural telecom penetration in the toughest terrains and
remotest locations, your Company was awarded the 2012 - CNBC Essar
Steel, Infrastructure Excellence Award as the "Telecom Infrastructure
Company of the Year".
The Company was awarded the coveted CIO-APC Green IT Award 2012, for
successfully consolidating and virtualising our data center and making
significant reduction in carbon emissions.
Your Company won the globally acclaimed iCMG IT Architecture Award 2012
for its landmark end-to-end enterprise tool - Infratel Enterprise
Suite. This first of its kinds IT platform within the telecom
infrastructure industry, was awarded the Best Enterprise & IT
Architecture Award in Telecom category, and was recognised for its
intricate stack of technology platforms, integration with multiple
applications and the significant cross-functional benefits which it has
delivered. The category saw participation across 25 countries and over
100 global organisations.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors
to the best of their knowledge and belief confirm that:
I. in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
II. we have selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year ended March 31, 2013 and
of the profit of the Company for that period;
III. we have taken proper and sufficient care 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 fraud and other irregularities;
IV. we have prepared the annual accounts on a going concern basis.
ACKNOWLEDGEMENT
The Directors wish to place on record their appreciation for the
assistance and co-operation extended by customers, strategic investors,
bankers, vendors, business partners, various agencies and departments
of Government of India and State Governments where Company''s operations
are existing, supporting the Company''s various projects.
The Directors would also like to place on record their sincere
appreciation for the valuable contribution, unstinted efforts and the
spirit of dedication shown by the employees of the Company at all
levels in ensuring an excellent all round operational performance.
For and on behalf of the Board
Place: New Delhi Rakesh Bharti Mittal
Date: April 30, 2013 Chairman
Mar 31, 2009
Dear Shareholders,
The Directors are pleased to present the Third Annual Report on the
business and operations of the Company together with audited financial
statement and accounts for the financial year ended March 31, 2009.
Business overview
The Company has been formed with the objective of creating an
independent tower company, by taking over passive infrastructure of
Bharti Airtel Ltd, which would provide passive infrastructure services
to all telecom operators in India on a non-discriminatory basis.
Bharti Infratel Limited deploys, owns and manages passive
infrastructure in 11 telecom circles comprising of 18 states of the
Union of India which comprises of Arunachal Pradesh, Assam, Bihar,
Chattishgarh, Haryana, Himachal Pradesh, Jammu & Kashmir, Jharkhand,
Madhya Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Orissa,
Rajasthan, Tripura, Uttar Pradesh and Uttarakhand.
The Company also holds 42% share in Indus Towers Limited (a Joint
Venture between Bharti Infratel, Vodafone & Idea Cellular). Indus
Towers operates in 16 circles (4 circles common with Infratel, 12
circles on exclusive basis).
Bharti Infratel has 27,548 towers in 11 circles, excluding the 35,066
towers in 12 circles for which the right of use has been assigned to
Indus with effect from 1st Jan 2009. Indus Towers has built 14,484
towers during the financial year ended March 09 and has a portfolio of
95,154 towers including the towers under right to use.
Your Company has implemented a system of robust quality checks. Each
tower which is offered to the customer goes through a Total Quality
Assurance (TQA) check to ensure that each technical specification is
complied with. This audit is conducted by an independent agency.
Further, the Company is in the process of implementing a system in
place for regular audit of towers deployed across the country to ensure
that the towers are maintained in the right condition at all times.
Bharti Infratel Limited has invested in state of the art automated
processes and IT in partnership with IBM to enable and deliver world
class infrastructure uptimes and deployment services. The Company is in
the process of setting up own Tower Operating Center (TOC) with
Multiprotocol Label Switching (MPLS) and General Packet Radio Service
(GPRS) connectivity to all the sites. This TOC and the data centre will
store live information on all the projects being executed across the
country. It also tracks the uptime information and behavior of all the
equipment online, which is processed for preventive action.
Bharti Infratel Limited is committed towards effective and efficient
Energy management in line with its vision of Environment friendliness.
The Company has pioneered several technical innovations in the country
such as use of Green Shelters, Power Interface Units, Passive s Cooling
Material to delay use of DGs, use of Battery Chillers for better energy
efficiencies.
The Company is exploring opportunities and is developing strategy to
enable it to participate in Clean Development Mechanism (CDM) Program
and earn Carbon Credits.
Indus Towers Limited
Indus Towers Limited is a Joint Venture between Bharti Infratel
Limited, Vodafone Essar Limited and Idea Cellular Limited to maintain
and operate tower infrastructure business with an equity structure of
42:42:16 respectively. Indus Towers Ltd. (Indus) is engaged in the
business of providing passive infrastructure at its various
telecommunications sites, along with related operations and maintenance
services to various telecom operators in India on a shared basis.
During last financial year, Indus has rolled out more than 14,000 new
built sites. These sites have been built to cater to the needs of
operators like Airtel, Vodafone, Idea and other telecom operators with
respect to the requirements for rural coverage and to fulfill the
capacity requirements in the existing coverage areas.
In addition to the above, Bharti Infratel, Vodafone and Idea Cellular
would transfer approx. 80,000 sites to Indus by way of merger, which is
underway. In the interim, the three shareholders in Indus have entered
into an arrangement with Indus which gives Indus the right of use of
such assets.
Indus is using state of art infrastructure technology, robust IT
platform and is in the process of implementing a patented Tower
Operating Centre (TOC), a novel concept used for first time in the
world to manage its passive infrastructure elements like PIU, SMPS,
battery bank and DG set remotely.
Indus has a large pool of domain experts in telecom infrastructure
industry.
Financial Results and results of operation
(Figures in '000)
Particulars Year ended/March Year ended-March
31,2009 31,2008
Income including other income 26,173,284 4,471,499
Profit/(Loss) before finance
expenses, 15,046,539 2,497,779
depreciation & amortisation
and taxation
Finance Expenses (Net) 1,115,982 (335,627)
Depreciation & Amortisation (11,788,098) (1,524,056)
Profit/(Loss) before Tax 4,374,423 638,096
Mat Credit 450,895 72,002
Tax Expenses (1.861,941) (291,496)
Net Profit/(Loss) after Tax 2,963,377 418,602
Profit/(Loss) brought forward
from earlier 418,531 (71)
years
Profit V(Loss) carried to
Balance Sheet 3,381,908 418,531
Dividend
The directors believe in the incredible growth potential in the passive
infrastructure sector and the Company should capitalize on these by
expanding and strengthening its existing network. Keeping in view the
Company's need for capital, its growth plans and the intent to finance
those plans through internal accruals to maximum, the Directors do not
recommend any dividend for the year ended March 31, 2009. The Directors
believe this would increase shareholder value and eventually lead to a
higher return threshold.
Fixed Deposits
The Company has not accepted any fixed deposits and, as such, no amount
of principal or interest was outstanding as of the date of Balance
Sheet.
Auditors
The Statutory Auditors of the Company M/s. S R Batliboi and Associates,
Chartered Accountants shall retire at the conclusion of forthcoming
Annual General Meeting and being eligible have offered themselves for
re-appointment. A Certificate has been received from M/s. S R Batliboi
and Associates confirming therein that their appointment, if made, will
be within the limits prescribed u/s 224(1 B) of the Companies Act,
1956.
To have effective governance and internal control mechanism, the
Company has appointed 'Control Solutions International' as internal
auditors of the Company for the financial year 2008- 2009.
Auditors' Report
The Board has duly examined the statutory auditor's report on accounts
and there is no reservation, qualification or adverse remark contained
in the said report.
Directors
Since the date of last Directors' Report, Mr. Sunil Bharti Mittal and
N. Kumar were appointed as additional director(s) of the Company on
29th April 2008 which have been regularised, as director liable to
retire by rotation, in the last annual General Meeting of the Company
held on 22nd July, 2008. Mr. N Kumar is an Independent Director.
During the year under review, Mr. Akhil Gupta has been appointed as
Managing Director of the Company for a period of five years with effect
from 1st August 2008 with remuneration.
Mr. Ashok Juneja has resigned from the services of the board of the
Company. The Board places on record its sincere appreciation for the
services rendered by Mr. Ashok Juneja during his tenure on the Board.
Pursuant to the provisions of the Companies Act, 1956, Ms. Vijaya
Sampath and Mr. Inder Walia, Directors of the Company, are liable to
retire by rotation at the forthcoming Annual General Meeting and being
eligible, offers themselves for re-appointment.
Subsidiary Company
As on 31st March, 2009 the Company has one wholly owned subsidiary
(100%), viz, Bharti Infratel Ventures Limited for the purpose of
demerger of the undertaking comprising of the passive infrastructure of
the Company in 12 Circles viz. Mumbai, Kolkata, Maharashtra, Tamil
Nadu, Kerala, Gujarat, Delhi, Chennai, Kamataka, Andhra Pradesh, Punjab
& West Bengal, and subsequent merger thereof with Indus Towers Limited.
A copy of Balance Sheet, Profit and Loss Account, Directors Report and
Auditors Report thereon of Bharti Infratel Ventures Limited is attached
herewith and form integral part of this report.
The statement of Company's interest in its wholly owned subsidiary,
Bharti Infratel Ventures Limited under Section 212(1)(e) of the
Companies Act, 1956 is annexed herewith and forms part of the
Directors' Report.
Board Committees and its Composition
Since the date of last Director's Report, the Board of Directors has
constituted the following Committees of the Board:
1. Audit Committee
The Audit Committee of the Board was constituted by Board of Directors
on 29th April, 2008 for analyzing, monitoring and reviewing various
financial matters and to perform related activities. As on 31st March
2009, the composition of Audit Committee was as follows:
1. Mr. N. Kumar - Chairman
2. Mr. Akhil Gupta
3. Mr. Carl Ludwig Oliver Haarmann
4. Mr. Padmanabh Sinha
2. HR & ESOP Compensation Committee
The HR and ESOP Compensation Committee of the Board was constituted by
Board of Directors on 29th April, 2008 for analyzing, monitoring and
reviewing various HR and compensation related matters and to perform
related activities. As on 31st March 2009, the composition of HR and
ESOP Compensation Committee was as follows:
1. Mr. Inderjit Walia - Chairman
2. Mr. Carl Ludwig Oliver Haarmann
3. Mr. Padmanabh Sinha
3. Related Party Committee
The Related Party Committee of the Board was constituted by Board of
Directors on 29m April, 2008 to review and approve all commercial
transactions between a shareholder and/or affiliates and company and/or
its subsidiary and all transactions regarded as related part
transactions As on 31st March 2009, the composition of Related Party
Committee was as follows:
1. Mr. Padmanabh Sinha - Chairman
2. Mr. N. Kumar
3. Mr. Carl Ludwig Oliver Haarmann
4. Borrowing Committee
The Board of Directors at their meeting held on 22nd July 2008
constituted the Borrowing Committee for borrowing any sum of money
within the overall limit approved by the Board of Directors and
shareholders. As on 31st March 2009, the composition of Borrowing
Committee was as follows:
1. Mr. Akhil Gupta
2. Mr. InderjitWalia
3. Ms. Vijaya Sampath
Changes in the Capital Structure
Since the date of last Directors' Report, the Authorised Share Capital
of the Company has been increased from INR 10,000,000 (INR Ten Million)
to INR 6,000,000,000 (INR Six Billion) only.
The shareholders of the Company in the second annual general meeting
held on 22nd July 2008, approved the issue of fully paid up bonus
shares of Rs. 10/- each in proportion of 9,999 (Nine Thousand Nine
Hundred Ninety Nine) bonus shares of Rs. 10/- each for every 1 (one)
fully paid up equity share of Rs. 10/- each held by the members by
capitalization of requisite sum standing to the credit of the Company's
General Reserve/Securities premium account.
Pursuant to the said approval of the members 540,445,950 (Five Hundred
Forty Million Four Hundred Forty Five Thousand and Nine Hundred Fifty
Only) fully paid equity shares were allotted as bonus shares to the
existing members of the Company on 21st August, 2008.
As a result of aforesaid allotment of shares, paid up share capital of
the Company stand increased from Rs. 540,500/- (Rs. Five Hundred Forty
Thousand and Five Hundred only) to Rs. 5,405,000,000,/- (Rupees Five
Billion and Four Hundred Five Million Only).
The Company has appointed Karvy Computershare Pvt. Limited to as its
Registrar and Transfer Agent. Equity shares and Compulsorily
Convertible Debentures issued by Company are in electronic form.
Employees
Bharti Infratel has over 600 on roll employees and provides direct
employment to over 3,000 people. This vast pool of human resource is
continuously upgraded in terms of technical and leadership skills
through various in house and outsourced training and development
activities such as process and project management skills and technical
skills such as preventive and breakdown maintenance of equipment.
Significant effort and resources are also directed towards building a
world class leadership pool to manage this highly distributed set of
people across in a very tough environment.
The employees of the Company have contributed most significantly to the
growth and development and have been the cornerstone of its success.
Equally the Company has endeavored to remain an employer of choice,
characterized by a progressive management style with fully empowered
teams across the company.
The Company's HR department constantly works on launching various
initiatives on an ongoing basis to attract and retain qualified,
talented and competent personnel and ensures that the employees are
motivated.
The Company values its human resource and is committed to adopt the
best HR practices. With an objective of employee engagement and long
term retention of the employees by providing them opportunity to
participate in the Company's earnings Employee Stock Option Plan (ESOP)
Policy has been formulated. The policy also helps in retention of
well-performing employees who are contributing to the growth of the
Company. The policy offers substantial discount on the fair value for
exercise of the grants.
Secretarial Audit
Keeping with the high standards of corporate governance adopted by the
Company and also to ensure proper compliance with the provisions of
various corporate laws, the Regulations and Guidelines, the company has
voluntarily started a practice of the Audit of Secretarial matters from
a practicing company secretary.
Statutory statements
The Statement pursuant to Section 217(2A) of the Companies Act, 1956
read with Companies (Particular of Employees) Rules, 1975 is annexed
hereto and forms part of the Report.
Energy Conservation. Technology Absorption and Foreign Exchange
Earnings and Outgo
The Statement as required under Section 217(1)(e) of the Companies Act,
1956, read with the Companies (Disclosure of Particulars in the report
of the Board of Directors) Rules, 1988 as amended is given in Annexure
to this report.
Directors' Responsibility Statement - Section 217(2AA) __
Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors
to the best of their knowledge and belief confirm that:
i. in the preparation of the annual accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures;
ii. they have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the company at the end of the financial year ended 31st March, 2009 and
of the profit of the company for that period;
iii. they have taken proper and sufficient care 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 fraud and other irregularities;
iv. they have prepared the annual accounts on a going concern basis.
Awards and Recognitions
Bharti Infratel Ltd has been adjudged as the 'Telecom infrastructure
Company of the year' at the Essar Steel Infrastructure Excellence
Awards in association with CNBC-TV18. The awards recognize and
felicitate infrastructure companies for their contribution to the
economic development of India.
This, signifies the recognition of initiatives by the Company to
provide passive infrastructure services even in the remotest corners of
India which have been instrumental in expansion of mobile services and
bridging the digital divide.
Corporate Social Responsibility
The Company has during the year donated an amount of Rs. 209,323 to the
Prime Minister Relief Fund.
Acknowledgement
The Directors' wish to place on record appreciation for the assistance
and co-operation extended by Strategic Investors, Bankers, Vendors,
Business Partners, various Agencies and Departments of Government of
India especially the Department of Telecommunications and State
Governments where Company's operations are existing, supporting the
company's various projects.
The Directors' would also like to place on record their sincere
appreciation for the valuable contribution, unstinted efforts and the
spirit of dedication shown by the employees of the Company at all
levels.
For and on behalf of the Board
Sd/-
Place : New Delhi Sunil Bharti Mittal
Date : 28th April 2009 Chairman
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Indus Towers Ltd. குறித்த கூடுதல் தகவல்களை
-
Indus Towers Ltd. டூல்ஸ்
- பல்க் டீல்ஸ்
- பிளாக் டீல்ஸ்
-
Indus Towers Ltd. நிறுவன தகவல்கள்
- நிறுவன சுயவிவரம்
- நிறுவன வரலாறு
- நிர்வாக குழு
- மூலதன வடிவம்
- புராடெக்ட் மிக்ஸ்
- வங்கியாளர்/தணிக்கையாளர்/பதிவாளர்
-
நிறுவன வரலாறு
- மும்பை பங்குச் சந்தையில் விலை வரலாறு
- என்எஸ்இ விலை வரலாறு
-
Indus Towers Ltd. முக்கிய நிதியில் விகிதங்கள்
- விகிதங்கள்
-
Indus Towers Ltd. முடிவுகள்
- காலாண்டு முடிவுகள்
- அரையாண்டு முடிவுகள்
- 9 மாத முடிவுகள்
- வருடாந்திர முடிவுகள்
-
Indus Towers Ltd. நிதியியல் தகவல்கள்
- தணிக்கை முடிவுகள்
- பணப்பாய்வு
- இருப்பு நிலைக்குறிப்பு
-
Indus Towers Ltd. அறிக்கை
- கணக்கியல் கோட்பாடுகள்
- தணிக்கையாளர்கள் அறிக்கை
- இயக்குநர்கள் அறிக்கை
- கணக்கு குறிப்புகள்
-
Indus Towers Ltd. கார்ப்பரேட் அறிவிப்புகள்
- புத்தக முடிவு
- ஈவுத்தொகை
- நிர்வாகக் குழுக் கூட்டங்கள்
- பெயர் மாற்றம்
