ESDS Unlisted Shares

Annual Report Summary

Annual Report

ESDS Software Solution Limited's annual report for the financial year 2023-2024 includes key information about the company's performance, board of directors, financials, and compliance.

Corporate Information:

• The Board of Directors includes Mr. Piyush Somani as Chairman-cum-Managing Director, Ms. Komal Somani as Whole Time Director, and Mr. Alipt Sharma as Nominee Director. Independent Directors are Mr. Dhandapani T. G., Ms. Pamela Kumar, and Mr. Venkatesh Natarajan.
• Mr. Nadukuru Sita Ramaiah is the Chief Financial Officer, and Mr. Prasad Deokar is the Company Secretary.
• The registered office is located in Nashik, while the corporate office is in Navi Mumbai, Maharashtra.
• Auditors are M/s. Shah Khandelwal Jain & Associates, and Internal Auditors are M/s. Kirtane & Pandit LLP.
• Axis Bank Limited and IndusInd Bank are the bankers, and Piramal Trusteeship Services Private Limited is the Debenture Trustee.

Promoter Information:

• Piyush Prakashchandra Somani, the Promoter, holds 2,68,52,696 Equity Shares, representing 28.91% of the company's issued capital.
• He has over 17 years of experience in the information technology sector and is on the board of ESDS's subsidiaries.

Board of Directors:

• Profiles of each director are provided, detailing their qualifications, experience, and roles within the company.
• Mr. Venkatesh Natarajan was appointed as an Additional Director, Non-executive Director (Independent) on July 1, 2023. His appointment was confirmed by the shareholders on September 30, 2024.
• Ms. Komal Somani will retire by rotation at the upcoming AGM and is eligible for re-appointment.
• The Key Managerial Personnel are Mr. Piyush Somani, Ms. Komal Somani, Mr. Nadukuru Sita Ramaiah, and Mr. Prasad Deokar.
• There have been no changes in management after March 31, 2024.

Financial Performance (FY 2023-24):

• Total Receipts/Gross Sales and Operating Income: ₹2,870.05 million (Standalone), ₹2,921.36 million (Consolidated)
• Profit Before Depreciation, Tax, and Exceptional Items: ₹755.18 million (Standalone), ₹761.09 million (Consolidated)
• Profit/(Loss) Before Tax & Exceptional Items: ₹260.78 million (Standalone), ₹235.57 million (Consolidated)
• Earnings per Equity Share (EPS): ₹1.77 (Basic and Diluted - Standalone), ₹1.35 (Basic and Diluted - Consolidated)
• Revenue from STPI increased by approximately 203% due to increased consumption. Revenue from IGR-LR also increased substantially. The MPPKVCL project started generating full-fledged revenue.
• New orders (TCV) included ₹24.09 Crores from the Mohali Data Centre and others from IGR-LR, Energy Efficiency Services Ltd, MCGM, Maharashtra State Co-operative Bank, and Netlink Software.
• A project worth Rs.6.64 Crores was received from Accenture Solutions.
• An extension of Contract from SJVN Limited amounted to Rs.7.65 Crores in FY 24.
• The Company is in process of delivering STPI Phase III Project in FY 25 which will substantially increase revenue annually by Rs.10.74 Crore.
• Total Contract value has been over Rs.175 Crores in FY 24.
• The Company achieved the highest collection from April 2023 to March 2024, totaling Rs. 260.44 Crores.
• Other Key Metrics (% Change): EBITDA (101.35%), PBT (220.51%), PAT (209.67%), BEBT (15.13%), DEBT/EBITDA Ratio (57.85%), RoE (200.99%).
• Authorised Share Capital: ₹460 million. Paid-up Equity Share Capital: ₹9,28,94,185.
• The Company had allotted 750 unlisted, secured, 10%, Non-Convertible Debentures (“NCDs”) of Rs.10 Lakhs each amounting to Rs.75 Crore for the tenure of 7 years during FY 2022-23.

Other Key Points:

• The Board did not recommend any dividend. Profits are retained for project investments.
• No amount transferred to the General Reserve. However, a Debenture Redemption Reserve of ₹75 million has been created.
• Mandatory Committees have been formed in accordance with IPO and SEBI regulations, including Audit, Nomination and Remuneration, Stakeholders' Relationship, Corporate Social Responsibility, and Risk Management Committees.
• The Company has 4 subsidiaries (2 Indian and 2 Foreign).
• The company website has hosted policies and codes of conduct.
• The Board consists of 2 Executive Directors and 4 Non-Executive Directors, of which 3 are Independent Directors.
• Changes in the Board include Mr. Venkatesh Natarajan's appointment as an Independent Director in July 2023.
• The non-executive independent directors had no pecuniary relationship or transactions with the Company, other than sitting fees, commission, reimbursement of expenses for attending meetings of the Board and its Committees.
• The Key Managerial Personnel as of March 31, 2024, were Mr. Piyush Somani, Ms. Komal Somani, Mr. Nadukuru Sita Ramaiah, and Mr. Prasad Deokar.
• The Board met 6 times during the year.
• The Directors affirmed their responsibility regarding financial statements.
• A policy for Familiarisation Programmes for Independent Directors is in place and hosted on the company website.
• Statutory Auditors are M/s. Shah Khandelwal Jain & Associate, and there were no instances of fraud reported by them. The Auditors' Report on Standalone and Consolidated Financial Statements does not contain any qualification, reservation or adverse remark.
• The Company's internal financial control system is adequate and commensurate with its size and nature of business.
• The Company has a Whistle Blower Policy compliant with Section 177 (10) of the Companies Act, 2013 and Regulations 22 of the SEBI (LODR) Regulation 2015.
• The Company has a Risk Management Policy, and no risks affect the Company's operations on a going concern basis.
• The Company has complied with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. No complaints were received during the year.
• The Company follows best practices for Corporate Governance, although not listed.
• The Company has duly constituted a Corporate Social Responsibility Committee and spent over the required amount of Rs.1.80 Lakhs on CSR activities for FY 2023-24.
• The Company promotes eco-friendly and green initiatives.
• ESDS is an innovation-driven company with its own R&D team.
• There are no employees drawing salary in excess of the limits specified u/s 197 of the Act.
• The Company has an Employee Stock Option Scheme – ESDS ESOP 2021.
• The Company's plant, property, equipment, and stocks are adequately insured.
• The Company is in compliance with Secretarial Standards issued by the Institute of Company Secretaries of India.

Report on Corporate Governance:

• ESDS is committed to high standards of Corporate Governance and aims to maintain transparency and ethical standards.
• The Board of Directors is composed of qualified individuals with expertise, skills, and experience.
• The Board Meetings are governed by a structured agenda, and decisions are backed by comprehensive information.
• The Company has constituted various committees like Audit, Nomination and Remuneration, Stakeholders Relationship, Corporate Social Responsibility and Risk Management Committee.

Audit Committee:

• The audit committee ensures the integrity of financial reporting and compliance.
• The details terms of references and composition of the Committee are provided.
• The members of the Audit Committee duly meet five times.

Nomination and Remuneration Committee:

• The Nomination and Remuneration Committee formulates criteria for determining qualifications and remuneration of directors and key managerial personnel.

Risk Management Committee:

• The Company has constituted Risk Management Committee of Directors to monitor various risks and initiate action for mitigation of risk arising in the operations.
• A process to continuously monitor the existing controls and identify gaps, if any, and implement new and /or improved controls wherever the effect of such gaps would have a material effect on the Company's operations.
• A Corporate Social Responsibility Committee has been constituted and Rs.1.80 Lakhs was spent towards corporate social responsibility.
• Independent Directors have meetings annually and discussed the performance of Board of Directors.

Other Disclosures:

• There have been no materially significant related party transactions.
• No non-compliance by the Company, penalties and strictures imposed.
• The company has implemented a Whistle Blower Policy and is availing its vigil mechanism.

General Shareholder Information:

• Annual General Meeting: Monday, 30th September, 2024 at 11:00 a.m.
• The annual report is sent by email to all the Shareholders of the Company who have registered email ID with Depository or RTA /Company.
• Registrars and Transfer Agents: Link Intime India Private Limited
• 9,28,94,185 Equity shares are held in the electronic mode as on 31th March 2023.

The report also includes standalone and consolidated financial statements, auditor's reports, and other relevant annexures. The report acknowledges the support of various government bodies, business constituents, and investors.