Quickheal Annualreport
Quickheal Annualreport
Quickheal Annualreport
Sssss Regd. Office: Marvel Edge, Office No. 7010 C & D, 7th Floor,
Opposite Neco Garden Society, Viman Nagar, Pune 411014.
Tel: +91 20 66813232 | Email: info@quickheal.com
CIN - L72200MH1995PLC091408
Dear Sir/Madam,
Subject: Submission of Annual Report 2019-20 and Notice of the 25th Annual General Meeting
(AGM) of the Company
Reference: Our letter No. Ref No.: QHTL/Sec/SE/2020-21/18 dated July 08, 2020
In terms of regulation 34(1) of SEBI (Listing Obligations and Disclosure Requirements), 2015, we
enclose herewith Annual Report 2019-20 and Notice of the 25th Annual General Meeting (AGM) of the
Company.
Today, Company has initiated the process of sending Notice through electronic mode to those
shareholders whose names was recorded in the Register of Members or in the Register of Beneficial
Owners maintained by the Depositories as on Friday, July 10, 2020.
The Company has uploaded the Annual Report 2019-20 on its website
https://www.quickheal.co.in/investors/financial-information#annualResults and AGM Notice is
available at https://www.quickheal.co.in/investors/annual-general-meetings
As permitted, this letter is being submitted under Sd/- mode due to work from home as per the
Government advisory on Covid-19 and as a part of safety measure.
Thanking you.
Sd/-
A. Srinivasa Rao
Company Secretary
www.quickheal.com
EMPOWERING BUSINESSES WITH RIGHT IT SECURITY
THE POWER OF
TWO
Partnering. Securing. Enduring.
Across the pages
Statutory Reports
Management Discussion and Analysis 24
Notice 44
Directors’ Report 58
Report on Corporate Governance 81 Disclaimer
This document contains statements about
Risk Management Report 99
expected future events and financials of Quick
Business Responsibility Report 101 Heal Technologies Limited, which are forward-
looking. By their nature, forward-looking statements
Financial Statements require the Company to make assumptions and are
Consolidated 109 subject to inherent risks and uncertainties. There
is significant risk that the assumptions, predictions
Standalone 163
and other forward-looking statements may not
prove to be accurate. Readers are cautioned not to
Please find our online version at
place undue reliance on forward-looking statements
https://www.quickheal.co.in/investors/financial-
as a number of factors could cause assumptions,
information#annualResults
actual future results and events to differ materially
Or simply scan to download from those expressed in the forward-looking
statements. Accordingly, this document is subject
to the disclaimer and qualified in its entirety by the
assumptions, qualifications and risk factors referred
to in the Management Discussion and Analysis of
this Annual Report.
Financial highlights
2019-20
₹ 2,861 Million+ ₹ 914 Million
Revenue in 2019-20 EBITDA in 2019-20
10.4%
Return on Equity in 2019-20
Shareholding Structure
TWO
needs no special
introduction.
2
Corporate Overview Statutory Reports Financial Statements
We are familiar with the strong forces at Be it the Wright brothers who changed the
way we travel, Larry Page and Sergey Brin
play, when two entities, two points of view of Google who changed the landscape of
modern Internet for us or be it Richard and
or two people come together to create Maurice McDonald of McDonald’s who have
something. completely revolutionised the fast food
industry. The list is endless.
In common parlance, it is often referred to History is witness to the many marvels
as ‘The Power of Two’ or ‘Partnerships’. created by ‘The Power of Two’. However the
unifying thread in all these ‘partnerships’ is
This power compliments diverse thinking the kindred spirit to bring about change and
making a paradigm shift. The undying passion
& skills to metamorphosise into stronger of bringing their ideas to fruition despite all
ideas and penchant to challenge existing hurdles defines their innate character.
norms in order to create positive outcomes. So what does it take to foster a strong
partnership? Is it only the bond that the two
people share, or is it more? Let’s explore…
THE POWER OF
Today, Quick Heal can boast of being the first Indian cybersecurity product company
to be listed on the Bombay Stock Exchange and National Stock Exchange with a solid
international footprint.
The journey of the Katkar brothers was besotted with hurdles. It wasn’t a fairy tale. The
‘Power of Two’ was very clearly at work which helped them overcome their hurdles.
Quick Heal would not have been what it is today, had it not been for Kailash’s sharp
business acumen coupled with Sanjay’s technology expertise. The best the two have
come together to create the best form of the two – Quick Heal.
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Corporate Overview Statutory Reports Financial Statements
25+
Years of innovation in the
cybersecurity industry
40+ Countries
Global presence
Vision Mission
To be the trusted global leader Secure our customers by providing
innovative, most-preferred and valued
in securing the digital world
security solutions, services and knowledge
Protect information and interactions across
networks, devices and things globally
Build a healthy business and organisation
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Corporate Overview Statutory Reports Financial Statements
Quick Heal’s
partnership with
consumers and
enterprises
The new India reflects a new found confidence and enthusiasm
to withstand challenges and emerge as a significant contributor
EMPOWERING BUSINESSES WITH RIGHT IT SECURITY to the global economy.
Home and
SOHO
SME Enterprises &
Government
9 Million+
Active licences globally
Platforms
Laptop
Server
Desktop Notepad
Smart devices
Mobile Tablets
Market Leader
in the retail segment in India
Revenue break-up
20%
80%
Retail
Enterprise and Government
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Corporate Overview Statutory Reports Financial Statements
Quick Heal’s
partnership with
channel partners
The partner ecosystems is the face of the brand.
Quick Heal is committed to delivering the highest
levels of customer experience by ensuring robust
partner policy.
A policy that envisages trust and transparency in our business conduct, training and mentoring of
partner members, process automation and meticulous execution, driven by operating discipline,
forms the bedrock of our partner engagement.
We, at Quick Heal Technologies, value our partner relationship and are committed to their financial
well-being.
Our robust sales and distribution network across the globe enables us to expand our reach in the
market. We work closely with our channel partners to identify potential areas of growth and provide
after-sales support.
Metro Sales
Coverage
Sales Execution Strong presence across
Robust pan India the top metros in India.
coverage Coverage through T1
distributors and T2
resellers
Landscape across
Complementary Class B & C towns
Presence in
Support from Growing presence of T1 Class A Towns
Quick Heal distributors across B & C
Strong distribution
Zonal and regional sales towns. Strong network
across Class A towns
team to engage and of T2 reseleers - across
backed by 72 resellers
support channel Class B and Class C
towns
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Corporate Overview Statutory Reports Financial Statements
Quick Heal’s
partnership with
employees
At Quick Heal, we firmly believe We continue to invest in projects and programs that enhance
employees’ skills and accelerate their output. This is achieved
that by giving employees the through a strong HR Policy framework that focuses on an
amicable work culture and provides employees with adequate
opportunity and support to excel training opportunities. We strive to build a culture of innovation
with several training and development platform and groom the
personally and professionally will change-makers of tomorrow. An open culture with a structured
strengthen their oneness towards learning methodology is helping our teamwork with greater
zeal and ownership and enabling us to becoming an employer
the organisation’s shared vision. of choice.
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Corporate Overview Statutory Reports Financial Statements
Quick Heal’s
partnership
with its
community
Quick Heals partnership with its community
is twofold. One is based on serving society
through meaningful social intervention
programs like cybersecurity awareness,
promotion of education and eradicating
extreme hunger and poverty. The other
pillar of community partnership is through
Quick Heal Academy that helps students
and Corporate India train, skill, prepare and
certify cybersecurity professionals for a
new emerging digital economy.
20,000+
Several current hurdles to development have been identified
by the United Nations Sustainable Development Goals.
Through efforts aimed at eradicating extreme hunger & poverty,
promotion of education, and employment enhancement, Lives directly impacted since 2016
vocational training & cybersecurity awareness, we seek to
provide innovative and technology-based solutions to these
global hurdles. Implemented by the Quick Heal Foundation, Eradicating Extreme Hunger and Poverty
each of these initiatives goes on to help and ensure a future
with a promise of success and security for all.
2,500+
Lives impacted since 2016
Annual Report 2019-20 15
Promotion of cybersecurity
The aspiration to achieve more fuels progress. For those at
the threshold of economic independence, this hope drives
them to achieve great feats. At Quick Heal, we actively seek
to spread the knowledge we have amassed over time and
allow for better economic opportunities for all. We engage
with students and teachers, equipping them with industry
relevant skills and training, to ensure the future bastions of
cybersecurity are prepared for tomorrow’s challenges.
Securing futures through Secure Programming
Earn and Learn – Cybersecurity Volunteers
Faculty Development Program
Cy-Fi Karandak
Street Plays
Promotion of education
Quality education is a significant facet of developed
communities. It enhances opportunities in the long-run and
focuses on the holistic growth of future citizens. We have
identified key areas which prevents students from achieving
their full potential. Our counsellors guide them throughout
these crucial points in their lives – from difficulties in learning
to those that affect their personal sphere.
Life Skills Education
Shalangan Counseling Centre
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Corporate Overview Statutory Reports Financial Statements
Cyber education
Universities Tie-ups
Protecting data,
2011-16 transactions & cloud
transitions
Secured PCs,
network & emails 1996-00
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Corporate Overview Statutory Reports Financial Statements
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Corporate Overview Statutory Reports Financial Statements
532
2016-17 2017-18 2018-19 2019-20 2016-17 2017-18 2018-19 2019-20 2016-17 2017-18 2018-19 2019-20
29
41
38 26 26
32
30
18
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Corporate Overview Statutory Reports Financial Statements
Board of Directors
Mr. Kailash Sahebrao
Mr. Sanjay Sahebrao
Katkar
Katkar
Managing Director & CEO
Joint Managing Director & CTO
Mr. Amitabha
Mr. Shailesh Lakhani
Mukhopadhyay
Non-Executive Director
Independent Director
Serves as the MD at
Over three decades of
Sequoia Capital India.
experience in corporate
Previously worked at
finance, legal and litigation,
Redknee’s India subsidiary
strategy and M&A. Served
as the Managing Director
as the Group CFO of
Thermax
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Corporate Overview Statutory Reports Financial Statements
4.20
3.09
2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20
Rise in cyber-attacks and data breaches scanning, probing, and vulnerable services accounted for over
As the world becomes more interconnected, another significant 61% of these incidents.
factor the industries are grappling with is the increasing A PWC report also indicates that business executives are
number of breaches and sophisticated cyberattacks, driven by acknowledging the increasing high stakes on account of these
different motives. breaches, and hence the need for them to evaluate their cyber
This is evident from 292% increase in cyberattack incidents, risk and focus on building resilience for the same.
from 53,081 in 2017 to 2,08,456 in 2018, reported by the Indian As per IBM survey, globally India has 2nd highest average
Computer Emergency Response Team (CERT-In). Network number of records breaches in 2019.
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Corporate Overview Statutory Reports Financial Statements
Regulatory norms driving security market needs for cloud, multi-factor authentication (MFA) for secure card
The increased frequency and sophistication of cyberthreats, payments and the Securities and Exchange Board of India’s
regulators are beginning to play an active role with increasing (SEBI’s) cyber resilience framework directives are some
supervisory coverage, formulating directives and tightening examples of such guidelines.
regulatory controls. While the cybersecurity products market is estimated to
Regulators are taking cognisance of evolving cyber risks witness a CAGR of 16.9% over three years and reach USD 1.64
and technological advancements and integrating these into Billion by 2022, the market for cybersecurity services will grow
directives and guidelines. Reserve Bank of India (RBI) controls to USD 1.41 Billion by 2022, at a CAGR 14.2%.
BFSI, IT/ITeS and Government are the top three sectors with the largest market share in
cybersecurity expenditure in India
Sectoral segmentation (in USD million)
3,053
1,977 6 %
Million Sectors Growth Rate
Million 15.
GR
CA
518 810 01 BFSI 16.1%
2.4 Impact of COVID-19 can be fully leveraged. The handling of data is a central
component in this context. In today’s digital world, personal
Interconnectivity of devices and the use of sophisticated
data is the fuel that drives much commercial activities online.
technologies such as Internet of Things (IoT), Artificial
However, how this data is used has raised concerns regarding
Intelligence (AI), cloud computing, big data, and analytics have
privacy and the security of information.
created an ecosystem with immense opportunities. However,
cybersecurity risks have been growing alongside the rise of Data Privacy is evolving as a basic right of consumers. In certain
digital world. In 2020, as the world grappled with the COVID-19 countries, it is recognised as a fundamental right, guaranteed
pandemic situation, it increased dependencies on digital tools by the constitution and supporting legal framework. To ensure
which in turn has reinstated the importance of cybersecurity. data protection, countries have now started taking different
approaches which include tackling matters related to data
“Fewer than one in four companies relied on the internet
sovereignty, data localisation, internet governance, handling
for their business operations 10 years ago; now, it is 100%,”
fake news and international law.
reads an Accenture report. While this highlights the rapid
expansion of digital economy, it also reflects the parallel rise Individuals, business and machines are generating enormous
of cybersecurity risks. international flows of data in what has been, to date, a
readily global digital economy. Governments, in response,
The Computer Emergency Response Team of India (CERT-In)
are grappling with the interplay between these international
noted that cyber criminals are exploiting the COVID-19 outbreak
data flows and domestic policy objectives related to privacy,
as an opportunity to send out phishing emails claiming to have
consumer protection, economics, cybersecurity, national
important updates or encouraging donations, impersonating
security and law enforcement.
trustworthy organisations.
In India, the private sector plays a significant role in operating
Cyber-attacks on personal computer networks and routers
critical information infrastructure, particularly in power,
have increased substantially in recent times, as nearly all the
transportation and healthcare. It is now more necessary than
professionals are now working from home. As per CERT-in,
ever before to take cognisance of new directions and shifts in
enterprise VPN servers have now become paramount to a
policies across the world.
company’s backbone, and their security and availability must
be the focus for IT security teams. A thorough risk and gap assessment of the current cyber
resilience of India’s various economic sectors, as well as that
A specific suggestion for IT teams from CERT-In is to
of the governance structure that enforces and manages the
consider Mobile Device Management (MDM) and Mobile
cybersecurity policy and framework is the need of the hour.
Application Management (MAM). MDM and MAM tools can
National cybersecurity projects such as the National Cyber
allow organisations to remotely implement several security
Coordination Centre (NCCC), National Critical Information
measures such as including data encryption, malware scans,
Infrastructure Protection Centre (NCIIPC) and the Computer
and wiping data on stolen devices.
Emergency Response Team (CERT) need to be strengthened,
manifold and reviewed.
3. Regulatory Framework to Ensure
As the global economy shifts further into a connected
Data and Privacy Protection
information space, the relevance of data protection and the
Creating trust online is a fundamental challenge in ensuring need for controlling privacy will further increase. There is no
that the opportunities emerging in the information economy single agreed model for data protection law at this stage.
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Corporate Overview Statutory Reports Financial Statements
However, compatibility is the stated objective of many global 4. Cyber Threats that Caught our
and regional data protection initiatives.
Attention in 2019
3.1. The Personal Data Protection Bill, 2019 The World Economic Forum’s (WEF) “Global Risks Report 2020”
The Personal Data Protection Bill which was tabled and passed states that cybercrime will be the second most-concerning risk
in Lok Sabha in December 2019, is a progressive move in India in for global commerce over the next decade. It also states that
regulating how a user’s data is protected without compromising cybercrime will be the seventh most-likely risk to occur, and
data sovereignty. It will represent a huge shift in the way eighth most impactful.
enterprises handle data.
As one of the leading sources of threat intelligence, research
In July 2017, the Ministry of Electronics and Information and cybersecurity, Quick Heal Security Labs analyses the
Technology (MeitY), Government of India (GoI), constituted threat data fetched from millions of active users across the
a committee of experts under the chairmanship of the retired globe. This helps us secure our users with timely and improved
Supreme Court judge Justice B. N. Srikrishna. The committee protection. While cybersecurity experts made it a point to give
was entrusted with the responsibility of identifying lapses in the a hard time to cyber criminals, there were several previously
present data protection regulations and preparing more robust discovered malware variants that continued to work in the wild
and comprehensive data protection laws. and reappeared as new variants in 2019.
Since its introduction last year, MeitY has solicited comments and Below are the top 10 malwares that caught our attention in
suggestions on the PDP Bill from the public, various stakeholders, 2019:
ministers and consultants. Based on these suggestions, a revised
Personal Data Protection Bill, 2019 (Draft Bill), was cleared by 4.1. LNK.Cmd.Exploit.F
the Union Cabinet on December 4, 2019. The Personal Data Method of propagation: Email attachments and malicious
Protection Bill, 2019 was introduced in Lok Sabha by the MeitY, websites
Mr. Ravi Shankar Prasad, on December 11, 2019. Uses cmd.exe with “/c” command line option to execute
The Bill seeks to provide for protection of personal data of other malicious files
individuals and establishes a data protection authority for the Executes simultaneously a malicious .vbs file with name
same. “help.vbs” along with a malicious exe file
3.2. National Cybersecurity Strategy 2020 The malicious vbs file uses Stratum mining protocol for
Monero mining
India was one of the first few countries to propound a futuristic
National Cyber Security Policy 2013 (NCSP 2013). Since the 4.2. Trojan.Starter.YY4
adoption of NCSP 2013, the technologies, platforms, threats,
Method of propagation: Email attachments and malicious
services and aspirations have changed tremendously.
websites
The Cybersecurity Policy of 2013 is open and technology neutral. Creates a process to run the dropped executable file
But it needs upgradation. The digital economy today comprises
Modifies computer registry settings which may cause a
14-15% of India’s total economy and is targeted to reach 20% by
system crash
2024. India has more than 120 recognised ‘data centres’ and
clouds. Downloads other malware like keyloggers
Slows down the booting and shutting down process of the
The transformational Digital India push as well as Industry 4.0
infected computer
is required to be supported by a robust cyberspace. However,
cyber intrusions and attacks have increased in scope and Allows hackers to steal confidential data like credit card
sophistication targeting sensitive personal and business data, details and personal information from the infected system
and critical information infrastructure, with impact on national
economy and security.
This will also speed up the process of infection Malware drops file in system32 folder and executes it from
dropped location
It infects all running processes
It connects to malicious website, also modifies start page of
It also infects HTML files by appending script in it while in the
browser to another site through registry entry
case of PE file infection it appends itself in the file
Also creates run entry for same dropped file for persistence
It modifies registry entries to ensure its automatic execution
at every system start up 4.8. W32.Sality.U
4.5. VBS.Dropper.A Method of propagation: Removable or network drives
Method of propagation: Web page Injects its code into all running system processes
This malware spreads via malicious web pages It then spreads further by infecting the executable files on
local, removable, and remote shared drives
A web page contains embedded PE file
Tries to terminate security applications and deletes all files
It drops that PE file to specific folder and launches that to
related to any security software installed on the system
perform malicious activity
Steals confidential information from the infected system.
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Corporate Overview Statutory Reports Financial Statements
400 M
350 M
300 M
250 M
200 M
150 M
100 M
50M
M
Trojan Infector Exploit Worm PUA Adware Cryptojacking Ransomware
5. Cybersecurity Trends & Predictions used complex methodologies with the aid of advanced
technologies to prevent easy detection of cyber-attacks.
5.1. Cybersecurity Trends Smartphones emerged as one of the most vulnerable digital
Cybercriminals are using more advanced and scalable tools to devices. Hackers attempted to steal sensitive data in 2019 by
breach user privacy, and they are getting results. Quick Heal targeting popular apps such as WhatsApp to deploy spyware
detected 930 Million threats in 2017, and more than 970 Million and malware.
threats in 2018. Amongst other interesting trends highlighted in the Seqrite
Quick Heal has detected and blocked over 1 Billion known Annual Threat Report 2020 was the growing sophistication
and unknown threats targeting Indian consumers in 2019, of malware attacks. Open-source tools, for instance, were
accounting to over 2.9 Million detections on a daily basis. used to drive the success of Emotet and Phobos ransomware
Consumers in Maharashtra and the Delhi-NCR region were campaigns, while BlueKeep-based RDP attacks have also
targeted the most, with 38 Million and 25 Million detections, grown due to the availability of freely-available exploit kits on
respectively. West Bengal, Karnataka, and Gujarat rounded popular exploitation frameworks.
off the top five states with the most threat detections. Users More alarming, however, was the continued lack of
residing in New Delhi – which saw more than 24 Million threat security awareness amongst enterprises and government
detections in 2019 – were once again identified as the most organisations. Unsecured Remote Desktop Protocol (RDP)
lucrative target for cybercriminals. Other top Indian cities, and Server Message Block (SMB) protocols continued to be
besides New Delhi, with the most threat detections include targeted through brute-force attacks. Spear phishing attack
Mumbai, Bengaluru, Kolkata, and Pune. campaigns leveraging office exploits and infected macros
Security researchers at Quick Heal revealed that cybercriminals were also used extensively by cybercriminals to gain access to
enterprise networks and steal critical data.
Annual Report 2019-20 31
5.2. Cyberthreat Predictions for 2020 quarter, we saw 67% of attacks on Windows 7 itself, which will
increase all the more in 2020 because securityupdates will not
As new advances in AI-driven technologies evolve, utilising
be available for Windows 7.
AI in cyber-attacks will become an even more popular and
dangerous trend. Attackers are predicted to leverage a lot 5.2.7. Increased use of LOLBins
of AI in building a Guerrilla warfare strategy to maximise the Cybercriminals will increase the use of ‘Living Off the Land’
impact of their attacks and throw cyber defences off-balance. techniques to bypass traditional security tools and application
Legacy and new attack tactics are predicted to occur in 2020. whitelisting. They may adopt new techniquesto bypass
Quick Heal sees following kind of cyberattacks to rise in 2020: behavioural-based detections.
5.2.1. Increase in Web Skimming Attacks 5.2.8. Increase in Office Macro-based Attacks Over
Magecart proved to be a prominent web skimming attack in Office Exploits
2019 as well, with thousands of websites compromised to As Microsoft has taken many steps to block MS Office exploits
deliver skimming code. Similar to Magecart, Pipka is another in the newer version of Windows, it is hard to execute exploit
web skimmer which has recently emerged having self-deleting code on Windows. Moreover, exploits are specific to application
code abilities. We suspect that skimming attacks are set to versions, but Macros will execute in all versions of MS Office.
increase in 2020, as we see a huge number of hits for these There are many open source obfuscator and Macro generation
attacks at this point in time. tools freely available to create a Macro-based payload. Many
5.2.2. Look out for more Bluekeep-like Wormable security vendors are also blocking a Macro execution but Excel
Exploits Macro 4.0 is freely available to bypass these techniques.
Until now, publicly available exploit codes for Bluekeep could 5.2.9. Ransomware to Darken the Cloud
only achieve DoS attacks on the victim machine, but it’s only Apart from attacks on individual computers and critical
a matter of time that attackers will figure out ways to exploit infrastructure, ransomware will be directed towards the
the vulnerability to its full potential and perform more severe fairly nascent concept of data stored on the cloud. Cloud
attacks like delivering trojans and ransomware - authors of the infrastructure has vulnerabilities which, perhaps, the attackers
latter are constantly on the lookout for such wormable exploits, are aware of but aren’t brought to the attention of respective
as it makes lateral movement easier. cloud technology developers. Hackers will ensure exploiting
5.2.3. Deepfakes to Cyber-frauds the cloud to steal copious amounts of data.
Deepfakes are fake/manipulated video or audio clips of a
person, created using deep learning technology. This can be 6. Recent Prominent Cyber Threats
used to create fake news and even carry out cyber frauds. That Shook the World
A company’s CEO featuring in a deepfake video asking
colleagues or employees to transfer funds is a classic example 6.1. First American
of deepfake video. Potentially the second-biggest data breach in history took place
at the largest real estate title insurance company in the United
5.2.4. APT attacks on Critical Infrastructures
States, First American. At nearly 900 Million compromised
The recent APT attack on Kudankulam Nuclear Power Plant records, it falls in line only behind Yahoo!’s hack in 2013 that
has emphasised on the significance of security of the critical impacted 3 Billion accounts.
infrastructure. We may witness a rise in such APT attacks on
the critical public infrastructure like transportation networks, The ongoing data leak at First American reportedly involved
power plants, telecommunication systems, etc. Such attacks mortgage documents dating back to 2003 and included
can function in hiding for days, even months, stealing very personal identifying information, bank account numbers,
large chunks of data before being detected. driver’s licenses, social security numbers, tax records and
other stolen information.
5.2.5. Increase in Threat Landscape because of 5G
What makes the massive leak unique is that it wasn’t
With 5G network, everything from your car to refrigerator will
discovered by tech-savvy security experts, but by a real estate
now have access to high-speed connectivity. This will, in turn,
developer, Ben Shoval. By merely changing a single digit in
create more exposure to attacks and more potential entry
the URL, he noticed he could access sensitive documents
points for attackers. Threat actors, organisations & institutions
belonging to others. Making the incident even more egregious
will have a larger landscape to monitor and the growth of the
is that he first tried bringing it to the attention of First American
confidentiality and privacy threats will be unprecedented. Also,
which ignored his warnings. Knowing the gravity of the issue,
the main functions of 5G depend on software rather than the
he then reported it to Brian Krebs, an investigative journalist
hardware which leaves it vulnerable to malicious attacks.
specialising in cybercrime.
5.2.6. Attacks against Windows 7 to increase
6.2. Facebook
Since Microsoft is ending its support for Windows 7 from
January 14, 2020, technical support and software updates While still reeling from the fallout of the Cambridge Analytical
from Windows will no longer be available for users. In the last scandal that was discovered in 2018, Facebook confirmed in
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Corporate Overview Statutory Reports Financial Statements
April’19 that more than 540 Million records showed up in plain 6.5. Hack Attack on Indian Healthcare
sight after accidentally being posted publicly as plain text on
Websites
Amazon’s cloud computing servers.
Indian-based healthcare websites became a victim of cyber-
Then in September’19, despite Facebook’s announcement that it attack recently in 2019. As stated by US-based cybersecurity
was making security improvements by restricting access to data, firms, hackers broke in and invaded a leading India-based
419 Million records including unique Facebook IDs and phone healthcare website. The hacker stole 68 lakh records of
numbers were found to be unprotected by any password at all. patients as well as doctors.
This latest incident increases the risk of spam calls and SIM-
swapping attacks on users’ smartphones — a tactic that relies on 6.6. Attacks in Co-operative Banks using
tricking cell carriers to transfer phone numbers to a hacker. COVID-19 as a Bet
While the entire world was busy fighting COVID-19 pandemic,
6.3. Malware attack on Kudankulam Nuclear
cybercriminals have latched onto the opportunity and used the
Power Plant (KKNPP) theme to propagate numerous cyber-attacks. The latest in line
On October 20, authorities confirmed that India’s largest nuclear is a targeted attack against co-operative banks in India. In April
power station in Kudankulam fell victim to a cyber spy attack, by 2020, Quick Heal Security Labs observed a renewed wave of
the North Korean hacker group-Lazarus. They were allegedly Adwind Java RAT campaign, whose primary target seems to be
willing to grab information on thorium-based reactors, an co-operative banks. These banks are usually small in size and
alternative to uranium. However, The National Power Corporation may not have a large team of trained cybersecurity personnel,
of India (NPCI) initially denied the news but later admitted that which, potentially, has made them a target for cybercriminals.
one of the computers may have been sabotaged. The malware
As with a large percentage of COVID-19 related cyber-attacks,
‘Dtrack’ took advantage of the loopholes in security systems. The
this recent Java RAT campaign also starts with a spear-phishing
attack on KKNPP reflected that a multi-layered defence system is
email. In this case, the email claims to have originated from
required to shield from the new trend of ‘cyberattacks’.
either Reserve Bank of India or a large banking organisation
6.4. Indian Journalists andActivists Spied on within the country. The content of the email refers to new RBI
by Israeli Spyware Pegasus guidelines or a transaction, with detailed information in an
attached file, which is a zip file that contains a malicious JAR
Scores of academicians, lawyers, activists and journalists in India
file. Use of document file extensions (e.g. xlsx, pdf, etc.) in the
were informed by WhatsApp that they were under scrutiny, which
name of the attachment, results in it appearing as an excel
sparked a furore among them.
document or a PDF file, thus luring unsuspecting users into
WhatsApp alleged that the NSO Group built and sold a hacking opening it. The JAR file is Remote admin Trojan that can be run
malware that took advantage of a flaw in the servers. The spyware, on any machine installed with Java including windows, Linux,
called Pegasus helped government spies to hack into phones and Mac.
of around 1,400 users, spread across four continents. Pegasus
Once the user opens the attachment, this JAR file transforms
allowed spies to remotely access everything on the phone. But
into a Remote admin tool (JRat) which can perform various
after the news of cyberattacks rolled out in May, WhatsApp
malicious activities such as keylogging, capturing screenshots,
announced updating new security features to their systems.
downloading additional payloads, and getting user information.
India in Numbers
500Million+
Internet users
450 Million+
Smartphone users
1 out of every
Indians watch online video
3
Source: Think with Google, India. How 3
Indian brands used online video to drive
business results.
October, 2019: Think with Google, India.
A new brand of smartphone shoppers,
December, 2019.
UPI transactions exceeded those of debit and credit cards in both value and volume.
Unsurprisingly, merchants accepting UPI payments surged to over 10 million in the
last two years.
Source: Google Internal Data, India, January to November, 2019 vs January to November, 2018
KPMG Report, Fintech in India – powering mobile payments, August, 2019.
Some Recent Developments and trends show India is on its way to becoming a truly connected nation by
2025
As of January 2020, more than 542 banks have been permitted to provide mobile banking services in India
As per report by Ericsson, India has the world’s highest data usage per smartphone at an average of 9.8 GB per month
Government Initiatives
The government has fast-tracked reforms in the telecom sector and continues to be proactive in providing room for growth
for telecom companies
By March 2020, the government aims to achieve 45 Billion digital transactions for banks with the help of PoS machines,
transactions enabled and merchants, which have been added in firms
The Department of Information Technology intends to set up over 1 Million internet-enabled common service centres across
India as per the National e-Governance Plan
FDI of up to 100% is permitted for infrastructure providers offering dark fibre, electronic mail and voice mail
The government of India has introduced Digital India programme under which all the sectors such as healthcare, retail, etc.
will be connected through internet
34
Corporate Overview Statutory Reports Financial Statements
Digitalisation Journey of Enterprises to employees’ laptops and phone which are not adequate.
All over the world, enterprises are digitalising operations in This was one of the important lessons for the enterprises who
different way, including, design improvement, operational were not flexible in their working style and are now planning
improvement, engineering as well as maintenance to become a flexible work environment company. This trend
improvement. The trend of increasing spend on digitalisation has led to number of companies increasing their cybersecurity
is for the ultimate goal of staying ahead of the curve and spending budget in times when other expenditure items are
increasing the end-to-end efficiency of the enterprise. being scaled back or put on hold.
In India, government initiatives such as Make in India has 8.3. Mobile Security
put the country as a manufacturing hub on world map. Other Work from home or work on the move culture is picking up
government initiatives such as Smart Cities and Digitalisation across the world in recent years which involves considerable
of India has increased focus on automating processes driven part of work done on mobiles and tablets. This trend makes
by Internet of Things (IoT) which allows enterprises to be agile mobile devices critical and integral part of the business, but it is
and flexible. also seen that enterprises are growing increasingly concerned
Post COVID-19 India is expected to see accelerated about this overlooked area of their security strategies and
digitalisation to bring back the growth to normal. Hard hit therefore mobile security is seen going up the ladder in list of
MSME will learn from their losses during lockdown as their the top of the priorities for enterprises.
operations weren’t digitalised and this will lead to accelerated On the retail part, the sheer convenience of shopping and
digitalisation across the industries and sectors. banking with mobile phones has made it an exceedingly
Rapid digitalisation and increased use of IoT across the popular device for digital transactions. According to a KPMG
platforms will call for securing online data which will be open report, digital payments are estimated to witness a CAGR of
to hacks and data breaches due to digitalisation. 12.7% in the number of non-cash transactions by 2021. The
growth is being driven by India which will see a growth in non-
Source: Bloomberg Quint, Ibef.org, Statista, Economic times, Business cash transactions of 20% by 2023, far higher than the United
Today, Google Report: Insights for Brands States, the United Kingdom, China and Japan.
36
Corporate Overview Statutory Reports Financial Statements
Product
Management Team:
Security Labs: Ensures that we build
Detect and analyze the Right Products for
threat vectors across the Right Markets
the globe and provide at the Right Time Product
advanced protection Management Team:
to customers Designing and building
cutting edge products
and solutions
Incidence
Response Team:
Ensures customers are
unaffected by critical
attacks / outrages by Quality Assurance
responding promptly Team:
Relentlessly maintaining
and creating industry
benchmarks for quality
Internet of Things
(IOT) Security Team:
Creating solutions
to ensure all your
connected devices are
secure
Customer Support
Our customer support includes multi-lingual end-user support in English, Hindi and other major regional Indian languages. We
periodically release various articles, technical papers, quarterly threat reports and conduct webinars in the area of security software.
Our customer support service also includes data sheets, product videos and manuals on websites. These provide information on
technical specification’s, installation guide, upgrade mechanisms along with release of various articles, technical papers, quarterly
threat reports and conducting webinars in the area of security software.
38
Corporate Overview Statutory Reports Financial Statements
42
Corporate Overview Statutory Reports Financial Statements
and sell our solutions or choose to use greater efforts to market While we have applied for registration of certain patents in India,
and sell their own solutions or the solutions of our competitors, none of them have been granted so far. Typically, we do not
our business operations will be adversely affected. Adverse obtain signed license agreements from customers who license
changes in our channel partner network or relationships products from us. In these cases, we include an electronic
with channel partners could adversely affect the quantity version of an end-user license in all of our electronically
and pricing of the solutions offered by us which may in turn distributed software and a printed license with our products
materially and adversely affect our business prospects. Quick that are distributed in a box. Although this is common practice
Heal has strong brand recognition in the Indian IT security for software companies that sell off-the-shelf products to have
market which is evident from the fact that it leads the retail licenses that are not signed by the licensee, certain legal
market with more than 30% market share. Our strong brand authorities believe that such licenses may not be enforceable
has helped us to extensively grow our partner network across under the laws of many jurisdictions. Proprietary technology
India. We have built two tier distribution model to ensure the used in our solutions is important to our success. We typically
rightful reach and mitigation of financial risks. Our sales team protect our intellectual property under patent, trademark,
is closely involved in maximising product availability across the copyright and trade secret laws and through a combination
channel and providing technical / sales assistance. of confidentiality procedures, contractual provisions and
other methods, all of which offers only limited protection. For
We provide on-going training (4 technical support centres) to
example, we have been granted four patents in the United
channel partners for providing support services to end users.
States and have registered trademarks such as “Quick Heal”,
This helps us to ensure that our partners are able to effectively
“Guardian”, “Security Simplified®”, “Aapke PC mein kaun rehta
sell our products and remain loyal to our brand.
hai, Virus ya Quick Heal®” and “Surf Canister®” in India. We
11.4. Exposure to High Credit Risk have registered trademarks for “Quick Heal®” and “Seqrite®”
AV retail industry predominantly work on stock and sales in the European Union. We have also obtained trademark
model. This being a hypercompetitive industry, heavy stocking registration for “Quick Heal®” in various countries such as
at all levels plays a pivotal role in driving market share. We Australia, Japan and the United States, among others, where
rely significantly on our channel partners to sell and support we currently do business or are planning to do business.
our solutions and we expect that sales through our channel
partners will continue to account for a significant percentage 12. Internal Control and Systems
of our revenues. Weakness in the end user market could The Company’s internal control systems adequately includes
negatively affect the cash flow of our channel partners or set of rules, policies and procedures that drive business,
distributors and resellers, who could, in turn, delay making increase efficiency and strengthen adherence to policies.
payments to us and impact our working capital. We typically These controls and systems are designed keeping the nature
offer our channel partners around average 60 days of credit. of our business, its size and complexity in mind. Our statutory
Furthermore, a change in the credit quality at one of our and internal auditors review our business and procedures on
channel partners or other counterparties can increase the risk a periodical basis to avoid errors and a systematic flow of our
that such counterparty is unable or unwilling to pay amounts business activities. All the significant observations, if any, are
owed to us, which could directly or indirectly have a material duly acted upon promptly. Reports of the same are thoroughly
adverse effect on our results of operations. We maintain strict reviewed by the Audit Committee at their meeting.
control on credit exposure to our channel partners. While our
sales team continuously works with them to ensure faster sales
turnaround, they also keep a close tab on collections from
13. Cautionary Statement
partner. This document contains statements about expected future
events, financial and operating results of Quick Heal
To mitigate the risk, we are as well working on adding more
Technologies Limited, which are forward looking. By their
primary distributors in this FY and as well directly tying up with
nature, forward looking statements require the Company
1,000+ sub distributors. The sales automation initiative is also
to make assumptions and are subject to inherent risks and
helping us to get real time picture and monitor the stock level
uncertainties. There is significant risk that the assumptions,
at each distributor.
predictions and other forward-looking statements will not
prove to be accurate. Readers are cautioned not to place
11.5. Challenge to protect our proprietary undue reliance on forward-looking statements as several
technology and intellectual property rights factors could cause assumptions, actual future results and
We have a registered Trademark for our Corporate Logo events to differ materially from those expressed in the forward-
“Quick Heal®” and enjoy statutory protection accorded to our looking statements. Accordingly, this document is subject to
Trademark. The protection and enforcement of our intellectual the disclaimer and qualified in its entirely by the assumptions,
property rights in the markets in which we operate is uncertain. qualifications and risk factors referred to in the Management’s
The laws of countries in which we operate or intend to expand Discussion and Analysis of Quick Heal Technologies Limited’s
our operations may afford little or no protection to our patents, Annual Report 2019-20.
copyrights, trade secrets and other intellectual property rights.
Notice is hereby given that the 25th Annual General Meeting SPECIAL BUSINESS:
of the Members of Quick Heal Technologies Limited will be 4. Re - Appointment of Ms. Apurva Pradeep Joshi (DIN:
held on Tuesday, August 11, 2020 at 11:00 A.M. IST through 06608172) as an Independent Director:
Video Conferencing (“VC”) / Other Audio Visual Means
To consider and if thought fit, to pass with or without
(“OAVM”) to transact the following business:
modification(s), the following resolution as a Special
ORDINARY BUSINESS: Resolution:
1. Adoption of Annual Accounts: “RESOLVED THAT pursuant to the provisions of Sections
To consider and adopt (a) the audited standalone financial 149, 150, 152 and other applicable provisions, if any, of
statements of the Company for the financial year ended the Companies Act, 2013(“the Act”) read with Schedule
March 31, 2020 and the reports of the Board of Directors IV to the Act (including any statutory modification(s) or re-
and Auditors thereon; and (b) the audited consolidated enactment(s) thereof, for the time being in force) and the
financial statements of the Company for the financial Companies (Appointment and Qualification of Directors)
year ended March 31, 2020 and the report of Auditors Rules, 2014, as amended from time to time, and regulation
thereon and in this regard, pass the following resolutions 17 of Securities and Echange Board of India (Listing
as Ordinary Resolutions: Obligation and Disclosure Requirements) Regulations ,
(a) “RESOLVED THAT the audited standalone financial 2015 (SEBI LODR Regulations), and Articles of Association
statements of the Company for the financial year of the Company pursuant to the recommendation of the
ended March 31, 2020 and the reports of the Nomination & Remuneration Committee and the Board
Board of Directors and Auditors thereon laid before of Directors, Ms. Apurva Pradeep Joshi (DIN: 06608172),
this meeting, be and are hereby considered and who holds office of Independent Director up to September
adopted.” 23, 2020 and who has submitted a declaration that she
meets the criteria for independence as provided under
(b) “RESOLVED THAT the audited consolidated financial
Section 149(6) of the Act and Regulation 16(1)(b) of the
statements of the Company for the financial year
SEBI LODR Regulations and in respect of whom the
ended March 31, 2020 and the report of Auditors
thereon laid before this meeting, be and are hereby Company has received a notice in writing under Section
considered and adopted.” 160(1) of the Act, from a Member, signifying his intention to
propose Ms. Apurva Pradeep Joshi’s candidature for the
2. To consider interim dividend declared and paid during office of Director, be and is hereby re-appointed as an
the year as final dividend for the financial year ended
Independent Director of the Company, not liable to retire
March 31, 2020.
by rotation, for a second term of five consecutive years
3. Director’s retirement by rotation and re-appointment: commencing from September 24, 2020 up to September
To appoint a director in place of Mr. Kailash Katkar (DIN: 23, 2025.”
00397191), who retires by rotation and, being eligible, “RESOLVED FURTHER THAT the Board of Directors of
offers himself for re-appointment, pass the following the Company (including its committee thereof) and / or
resolution as Ordinary Resolution:
Company Secretary of the Company, be and are hereby
“RESOLVED THAT pursuant to the provisions of Section authorized to do all such acts, deeds, matters and things
152 of the Companies Act, 2013 and Articles of Association as may be considered necessary, desirable or expedient
of the Company Mr. Kailash Katkar (DIN: 00397191), who to give effect to this resolution.”
retires by rotation at this meeting and being eligible, has
5. Re - Appointment of Mr. Mehul Savla (DIN: 02137699)
offered him-self for re-appointment, be and is hereby re-
as an Independent Director:
appointed as a Director of the Company, liable to retire
by rotation and he will be continued to be designated To consider and if thought fit, to pass with or without
as Managing Director and Chief Executive Officer of the modification(s), the following resolution as a Special
Company.” Resolution:
44
Corporate Overview Statutory Reports Financial Statements
Notice (Contd.)
“RESOLVED THAT pursuant to the provisions of Sections amount of ` 250.00 Million out of the current unspent
149, 150, 152 and other applicable provisions, if any, of the amount of ` 468.50 Million as on March 31, 2020 in the
Companies Act, 2013 (“the Act”) read with Schedule IV best interest of the Company for other projects inter alia
to the Act (including any statutory modification(s) or re- including ‘general corporate purposes’.
enactment(s) thereof, for the time being in force) and the
RESOLVED FURTHER THAT the consent of the Members
Companies (Appointment and Qualification of Directors)
be and is hereby accorded to the Board of Directors for
Rules, 2014, as amended from time to time, and regulation
varying the allocation of the unutilized funds out of the
17 of SEBI LODR Regulations and Articles of Association
IPO proceeds for the above stated objects.’’
of the Company pursuant to the recommendation of the
Nomination & Remuneration Committee and the Board 7. Reappointment of Mr. Kailash Katkar as Managing
of Directors, Mr. Mehul Savla (DIN: 02137699), who holds Director & Chief Executive Officer (CEO)
office of Independent Director up to September 23, To consider and, if thought fit, to pass, with or without
2020 and who has submitted a declaration that he meets modification(s), the following as an Ordinary Resolution:
the criteria for independence as provided under Section
“RESOLVED THAT pursuant to the provisions of Section
149(6) of the Act and Regulation 16(1)(b) of the SEBI LODR
196, Section 197, and other applicable provisions, if any, of
Regulations and in respect of whom the Company has
the Companies Act, 2013, read with Schedule V thereof
received a notice in writing under Section 160(1) of the
and the Rules made thereunder, including any statutory
Act, from a Member, signifying his intention to propose
modification(s) or re-enactment thereof, for the time being
Mr. Mehul Savla’s candidature for the office of Director,
in force and subject to Regulation 17(6)(e) of SEBI LODR
be and is hereby re-appointed as an Independent
Regulations and pursuant to the recommendation of the
Director of the Company, not liable to retire by rotation,
Nomination & Remuneration Committee and the Board
for a second term of five consecutive years commencing
of Directors, approval be and is hereby accorded for the
from September 24, 2020 up to September 23, 2025.”
re-appointment of Mr. Kailash Katkar (DIN: 00397191) as
“RESOLVED FURTHER THAT the Board of Directors of Managing Director & CEO of the Company for a period of
the Company (including its committee thereof) and / or 5 years with effect from April 01, 2020 for a period ending
Company Secretary of the Company, be and are hereby March 31, 2025 on the terms and conditions specified in
authorized to do all such acts, deeds, matters and things the Agreement to be entered into between the Company
as may be considered necessary, desirable or expedient and Mr. Kailash Katkar.
to give effect to this resolution.”
RESOLVED FURTHER THAT approval be and is
6. Variation in IPO proceeds: hereby accorded to the payment of remuneration to Mr.
To consider and, if thought fit, to pass with or without Kailash Katkar as set out in the Explanatory Statement
modification, the following resolution as a Special annexed to the Notice and the Board of Directors of the
Resolution: Company be and is hereby authorized to revise the said
remuneration from time to time during the said period of
“RESOLVED THAT pursuant to provisions of Section
five years, subject to the provisions of Section 197 and
27 of Companies Act, 2013, SEBI (Issue of Capital and
Schedule V of the Companies Act, 2013 and the SEBI
Disclosure Requirements) Regulations, 2018, and other
LODR Regulations for the time being in force.
applicable provisions, if any (including any statutory
modifications or re-enactments thereof, for the time RESOLVED FURTHER THAT Mr. Kailash Katkar shall
being in force), consent of the Members of the Company continue to be liable to retire by rotation and this
be and is hereby accorded to the Board to use/deploy appointment shall be subject to his continuance as
part of unutilized funds out of the proceeds of Initial a director of the Company during his tenure and shall
Public Offering (IPO) of its Equity Shares of the Company ipso facto terminate, if he ceases to be director of the
under the object “Advertising and sales promotion, an Company for any reason whatsoever.
RESOLVED FURTHER THAT Mr. Kailash Katkar shall RESOLVED FURTHER THAT approval be and is
continue to hold his office of Managing Director and hereby accorded to the payment of remuneration to Mr.
such appointment as such director shall not be deemed Sanjay Katkar as set out in the Explanatory Statement
to constitute break in his appointment as Chairman and annexed to the Notice and the Board of Directors of the
Managing Director. Company be and is hereby authorized to revise the said
remuneration from time to time during the said period of
RESOLVED FURTHER THAT the Board be and is hereby
five years subject to the provisions of Section 197 and
authorised to do all acts and take all such steps as may
Schedule V of the Companies Act, 2013 and the SEBI
be necessary, proper or expedient to give effect to this
LODR Regulations for the time being in force.
resolution.”
RESOLVED FURTHER THAT Mr. Sanjay Katkar shall
8. Reappointment of Mr. Sanjay Katkar as Joint Managing
continue to be liable to retire by rotation and this
Director & Chief Technical Officer (CTO)
appointment shall be subject to his continuance as
To consider and, if thought fit, to pass, with or without
a director of the Company during his tenure and shall
modification(s), the following as an Ordinary Resolution:
ipso facto terminate, if he ceases to be director of the
“RESOLVED THAT pursuant to the provisions of Section Company for any reason whatsoever.
196, Section 197, and other applicable provisions, if any, of
RESOLVED FURTHER THAT Mr. Sanjay Katkar shall
the Companies Act, 2013, read with Schedule V thereof
continue to hold his office of Joint Managing Director and
and the Rules made thereunder, including any statutory
such appointment as such director shall not be deemed
modification(s) or re-enactment thereof, for the time being
to constitute break in his appointment as Joint Managing
in force and subject to Regulation 17(6)(e) of SEBI LODR
Director.
Regulations and pursuant to the recommendation of the
Nomination & Remuneration Committee and the Board RESOLVED FURTHER THAT the Board be and is hereby
of Directors, approval be and is hereby accorded for authorised to do all acts and take all such steps as may
the re-appointment of Mr. Sanjay Katkar (DIN: 00397277) be necessary, proper or expedient to give effect to this
as Joint Managing Director & CTO of the Company resolution.”
for a period of 5 years with effect from April 01, 2020,
for a period ending March 31, 2025 on the terms and
BY ORDER OF THE BOARD OF DIRECTORS
conditions specified in the Agreement to be entered into
For Quick Heal Technologies Limited
between the Company and Mr. Sanjay Katkar.
Sd/-
Kailash Katkar
Place: Pune Managing Director & CEO
Date: May 21, 2020 (DIN: 00397191)
Registered Office: Marvel Edge, Office No. 7010 C & D, 7th Floor,
Viman Nagar, Pune- 411014. CIN: L72200MH1995PLC091408
Tel: +91 20 66813232, E-mail id: cs@quickheal.co.in
Website: www.quickheal.co.in
46
Corporate Overview Statutory Reports Financial Statements
NOTES
1. In view of the continuing COVID-19 pandemic, the 8. Relevant documents referred to in the accompanying
Ministry of Corporate Affairs (“MCA”) has vide its circular Notice and the Statement is open for inspection by the
dated May 5, 2020 read with circulars dated April 8, Members at the Registered Office of the Company on all
2020 and April 13, 2020 (collectively referred to as working days, except Saturdays, during business hours
“MCA Circulars”) permitted the holding of the Annual up to the date of the Meeting.
General Meeting (“AGM”) through VC / OAVM, without the
9. The Register of Members and Share Transfer Books shall
physical presence of the Members at a common venue. remain closed from August 06, 2020 to August 11, 2020
In compliance with the provisions of the Companies Act, (both days inclusive), for the purpose of AGM.
2013 (“Act”), SEBI LODR Regulations and MCA Circulars,
the AGM of the Company is being held through VC / 10. The Interim dividend, as declared by the Board of
OAVM. Directors, was paid to all the members on March 07,
2020. It is proposed to treat the same as final dividend
2. The relevant details, pursuant to Regulations 26(4) and for the year ended on March 31, 2020.
36(3) of SEBI LODR Regulations and Secretarial Standards
(SS) issued by the Institute of Company Secretaries of 11. Members holding shares in electronic form are requested
India, in respect of Directors seeking re-appointment at to intimate immediately any change in their address
or bank mandates to their Depository Participants
this AGM is annexed.
with whom they are maintaining their demat accounts.
3. Explanatory Statement pursuant to Section 102(1) of Members holding shares in physical form are requested
the Companies Act, 2013, with respect to the Special to advise any change in their address or bank mandates
Business to be transacted as aforesaid is annexed immediately to the Company / Registrar of the Company
hereto. (Link Intime).
4. Since the AGM will be held through VC / OAVM, the 12. The Securities and Exchange Board of India (SEBI)
Route Map is not annexed in this Notice. has mandated the submission of Permanent Account
Number (PAN) by every participant in the securities
5. Pursuant to the provisions of the Act, a Member entitled
market. Members holding shares in electronic form
to attend and vote at the AGM is entitled to appoint a
are, therefore, requested to submit their PAN to their
proxy to attend and vote on his/her behalf and the proxy
Depository Participants with whom they are maintaining
need not be a Member of the Company. Since this AGM
their demat accounts. Members holding shares in
is being held pursuant to the MCA Circulars through
physical form can submit their PAN to the Company / Link
VC / OAVM, physical attendance of Members has been
Intime.
dispensed with. Accordingly, the facility for appointment
of proxies by the Members will not be available for the 13. Non-Resident Indian Members are requested to inform
AGM and hence the Proxy Form and Attendance Slip are Link Intime, immediately of: a) Change in their residential
not annexed to this Notice. status on return to India for permanent settlement. b)
Particulars of their bank account maintained in India with
6. Institutional / Corporate Shareholders (i.e. other than
complete name, branch, account type, account number
individuals / HUF, NRI, etc.) are required to send a
and address of the bank with pin code number, if not
scanned copy (PDF/JPG Format) of its Board or governing
furnished earlier.
body Resolution/Authorization etc., authorizing its
representative to attend the AGM through VC / OAVM 14. The Register of Directors and Key Managerial Personnel
on its behalf and to vote through remote e-voting. and their shareholding and Register of Contracts
The said Resolution/Authorization shall be sent to the and Arrangements in which Directors are Interested,
Scrutinizer by email through its registered email address as maintained under Section 170 and section 189
to jbbhave@gmail.com. respectively of the Companies Act, 2013, will be available
for inspection by the Members at AGM.
7. In case of joint holders, the Member whose name
appears as the first holder in the order of names as per 15. In compliance with the aforesaid MCA Circulars and
the Register of Members of the Company will be entitled SEBI Circular dated May 12, 2020, Notice of the AGM
to vote at the AGM. along with the Annual Report 2019-20 is being sent
only through electronic mode to those Members whose
email addresses are registered with the Company/ their vote electronically. The e-voting module shall be
Depositories. Members may note that the Notice and disabled by CDSL for voting thereafter.
Annual Report 2019-20 will also be available on the
(i) Shareholders who have already voted prior to the
Company’s website www.quickheal.co.in, websites of
meeting date would not be entitled to vote at the
the Stock Exchanges i.e. BSE Limited and National Stock
meeting.
Exchange of India Limited at www.bseindia.com and
www.nseindia.com respectively, and on the website of (ii) The shareholders should log on to the e-voting
CDSL www.evotingindia.com. (On e-Voting website - website www.evotingindia.com.
www.evotingindia.com only notice to be uploaded and (iii) Click on “Shareholders” module.
not Annual Report).
(iv) Now enter your User ID
16. Members attending the AGM through VC / OAVM shall
a. For CDSL: 16 digits beneficiary ID,
be counted for the purpose of reckoning the quorum
under Section 103 of the Act. b. For NSDL: 8 Character DP ID followed by 8
Digits Client ID,
17. The Members who have cast their vote by remote
e-voting prior to the AGM may also attend/ participate in c. Shareholders holding shares in Physical Form
the AGM through VC / OAVM but shall not be entitled to should enter Folio Number registered with the
cast their vote again. Company.
18. Procedure and instructions relating to e-Voting: (v) Next enter the Image Verification as displayed and
Click on Login.
The voting period begins on August 08, 2020 at 12:01
AM (IST) and ends on August 10, 2020 at 5:00 PM (IST). (vi) If you are holding shares in demat form and had
During this period Members’ of the Company, holding logged on to www.evotingindia.com and voted
shares either in physical form or in dematerialized form, on an earlier e-voting of any company, then your
as on the cut-off date of August 05, 2020 may cast existing password is to be used.
(vii) If you are a first time user follow the steps given below:
For Shareholders holding shares in Demat Form and Physical Form
PAN Enter your 10 digit alpha-numeric *PAN issued by Income Tax Department
(Applicable for both demat shareholders as well as physical shareholders)
• Shareholders who have not updated their PAN with the Company/Depository
Participant are requested to use the sequence number sent by Company/
RTA or contact Company/RTA
Dividend Bank Details OR Date of Enter the Dividend Bank Details or Date of Birth (in dd/mm/yyyy format) as
Birth (DOB) recorded in your demat account or in the company records in order to login.
• If both the details are not recorded with the depository or company please
enter the member id / folio number in the Dividend Bank details field as
mentioned in instruction (v).
(viii) After entering these details appropriately, click on other company on which they are eligible to vote,
“SUBMIT” tab. provided that company opts for e-voting through
CDSL platform. It is strongly recommended not to
(ix) Shareholders holding shares in physical form will
share your password with any other person and take
then directly reach the Company selection screen.
utmost care to keep your password confidential.
However, shareholders holding shares in demat
form will now reach ‘Password Creation’ menu (x) For shareholders holding shares in physical form,
wherein they are required to mandatorily enter their the details can be used only for e-voting on the
login password in the new password field. Kindly resolutions contained in this Notice.
note that this password is to be also used by the
(xi) Click on the EVSN for the relevant <Company
demat holders for voting for resolutions of any
Name> on which you choose to vote.
48
Corporate Overview Statutory Reports Financial Statements
NOTES (Contd.)
(xii) On the voting page, you will see “RESOLUTION On submission of the shareholder’s details, an OTP
DESCRIPTION” and against the same the option will be received by the shareholder, which needs to be
“YES/NO” for voting. Select the option YES or NO entered in the link for verification.
as desired. The option YES implies that you assent 2. For Demat shareholders- It is clarified that for
to the Resolution and option NO implies that you permanent registration of e-mail address, the
dissent to the Resolution. Members are requested to register their e-mail
(xiii) Click on the “RESOLUTIONS FILE LINK” if you wish address in respect of demat holdings with their
to view the entire Resolution details. respective Depository Participant (DP) by following
the procedure prescribed by them.
(xiv) After selecting the resolution you have decided
to vote on, click on “SUBMIT”. A confirmation box INSTRUCTIONS FOR SHAREHOLDERS ATTENDING
will be displayed. If you wish to confirm your vote, THE AGM THROUGH VC/OAVM ARE AS UNDER:
click on “OK”, else to change your vote, click on 1. Shareholder will be provided with a facility to
“CANCEL” and accordingly modify your vote. attend the AGM through VC/OAVM through the
CDSL e-Voting system. Shareholders may access
(xv) Once you “CONFIRM” your vote on the resolution, the same at https://www.evotingindia.com under
you will not be allowed to modify your vote. shareholders/members login by using the remote
(xvi) You can also take a print of the votes cast by clicking e-voting credentials. The link for VC/OAVM will be
on “Click here to print” option on the Voting page. available in shareholder/members login where the
EVSN of Company will be displayed.
(xvii) If a demat account holder has forgotten the login
password then Enter the User ID and the image 2. Shareholders are encouraged to join the Meeting
verification code and click on Forgot Password & through Laptops / IPads for better experience.
enter the details as prompted by the system. 3. Further shareholders will be required to allow
(xviii) Shareholders can also cast their vote using CDSL’s Camera and use Internet with a good speed to
avoid any disturbance during the meeting.
mobile app “m-Voting”. The m-Voting app can be
downloaded from respective Store. Please follow 4. Please note that Participants Connecting from Mobile
the instructions as prompted by the mobile app Devices or Tablets or through Laptop connecting
while Remote Voting on your mobile. via Mobile Hotspot may experience Audio/Video
loss due to Fluctuation in their respective network.
PROCESS FOR THOSE SHAREHOLDERS WHOSE
It is therefore recommended to use Stable Wi-Fi or
EMAIL ADDRESSES ARE NOT REGISTERED WITH THE
LAN Connection to mitigate any kind of aforesaid
DEPOSITORIES FOR OBTAINING LOGIN CREDENTIALS
glitches.
FOR E-VOTING FOR THE RESOLUTIONS PROPOSED
IN THIS NOTICE: 5. Shareholders who would like to express their views/
ask questions during the meeting may register
1. For Physical shareholders- The Members of
themselves as a speaker by sending their request in
the Company holding Equity Shares in physical
advance atleast 7 days prior to meeting mentioning
Form and who have not registered their e-mail
their name, demat account number/folio number,
addresses may get their e-mail address registered
email id, mobile number at cs@quickheal.co.in. The
with Link Intime India Pvt Ltd, by clicking the link:
shareholders who do not wish to speak during the
https://linkintime.co.in/emailreg/email_register.
AGM but have queries may send their queries in
html or through their web site www.linkintime.co.in
advance 7 days prior to meeting mentioning their
> Investor Services > E mail / Bank Registration > name, demat account number/folio number, email
select ‘Quick Heal technologies Limited’ and follow id, mobile number at cs@quickheal.co.in. These
the registration process as guided therein. The queries will be replied to by the Company suitably
members are requested to provide details such by email.
as Name, Folio Number, Certificate number, PAN,
6. Those shareholders who have registered
Mobile number and Email ID and also upload the
themselves as a speaker will only be allowed
image of share certificate in PDF or JPEG format (up
to express their views/ask questions during the
to 1 MB) and other supporting.
meeting.
50
Corporate Overview Statutory Reports Financial Statements
NOTES (Contd.)
term of five years from September 24, 2015 to September 23, Both the Independent Directors who are seeking the re-
2020. (“first term” as per the explanation to Section 149(10) and appointment had actively participated in the meetings and
149(11) of the Act. gave timely inputs on the minutes of meetings. They adhered
to the ethical standards & code of conduct of the Company
The Nomination & Remuneration Committee at its Meeting held
and disclosed their non- independence as and when it exists
on May 20, 2020 after taking into account the performance
and also disclosed their interest. They raised valid concerns to
evaluation of these Independent Directors, during their first
the Board and contributed to resolution of issues at meetings.
term of five years and considering the knowledge, acumen,
They have good Interpersonal relations with other directors
expertise and experience in their respective fields and the
and management. They understand the Company and the
contribution made by these Directors during their tenure
external environment in which it operates and contributes to
as an Independent Director since their appointment, has
strategic direction.
recommended to the Board that continued association of
these Directors as Independent Directors would be in the The Company has received a notice in writing pursuant
interest of the Company. Based on the above, the Board to Section 160 of the Companies Act, 2013 from a Member
subject to the approval of shareholders at ensuing AGM, proposing the candidature of Ms. Apurva Joshi and Mr. Mehul
has recommended the re-appointment of these Directors Savla for their appointment as aforesaid to the office of
as Independent Directors on the Board of the Company, to Independent Directors. Both, Ms. Apurva Joshi and Mr. Mehul
hold office for the second term of five consecutive years Savla have confirmed that they fulfil the criteria of Independent
commencing from September 24, 2020 to September 23, Director as set out under Section 149 of the Companies Act
2025. If approved, both these Independent Directors shall not 2013 and have also registered themselves in the Database
be liable to retire by rotation during their term of five years as of Independent Directors as required under the Companies
aforesaid. (Appointment And Qualification of Directors) Rules, 2014.
Brief profiles of the above Independent Directors along with shareholding and other directorships are given below
Pursuant to Regulation 36 of the SEBI LODR Regulations read with SS-2 on General Meetings effective 1 October 2017,:
Particulars Ms. Apurva Joshi Mr. Mehul Savla
Date of Birth 10-04-1989 04-04-1974
Date of Appointment Initial Appointment – August 21, 2015 Initial Appointment – August 21, 2015
Appointment in AGM – 24-09-2015 Appointment in AGM – 24-09-2015
Qualifications Master of Commerce MBA
Experience Dr. Apurva Joshi heads the Technology Mr. Savla, Prior to starting RippleWave
and Due Diligence practice of Riskpro Advisors Private Limited, was with J. P.
Management Consulting Private Limited. Morgan India Private Limited as Executive
Before joining Riskpro, she owned a start- Director – Corporate and Investment
up called Fraudexpress which was started Bank, Equity Capital Markets (India), and
in Solapur and was later merged in Riskpro. ICICI Securities Primary Dealership Limited
Dr. Apurva Joshi is been part of Institute of (erstwhile ICICI Securities Limited) as Vice
Directors (IOD). She is the Fellow Member President – Corporate Finance. He started
of IOD; She is an Individual Member of his career with SEBI where at the time
Institute of Management Consultants of of his resignation, he was working in the
India (IMCI). Derivative Cell.
Expertise in specific functional areas Forensic Audit, Due Diligence, Risk Securities Market
Management
Number of shares held in the Company NIL NIL
List of directorships held in other Riskpro Management Consulting Pvt. Ltd. 1. Ripplewave Advisors Pvt. Ltd.
companies * 2. Vertigrow Offices Pvt. Ltd.
Number of Board Meetings attended 8 6
during 2019-20
Chairperson/Member in the Chairperson – Stakeholder Relationship Chairperson – Nomination & Remuneration
Committees of the Boards of Committee Committee
companies in which she/he is a director
Relationships directors inter se None None
Remuneration last drawn (Including ` 7,70,000 ` 6,70,000
sitting fee & commission)
*Based on disclosures received from the respective Directors.
A copy of the draft letter for the appointment of the above Directors as Independent Directors setting out the terms and conditions
would be available for inspection without any fee by the members at the Registered Office of the Company during normal business
hours on any working day and the same has also been put up on the Company website www.quickheal.co.in.
The other details including the shareholding of these Directors, whose appointment is proposed at item nos. 4 & 5 of the
accompanying Notice, have been given above. The Board recommend the Resolutions for re-appointment of the Independent
Directors at item no. 4 & 5 as Special Resolutions of this notice for your approval.
Ms. Apurva Pradeep Joshi and Mr. Mehul Savla respectively, are concerned or interested in the resolutions of the accompanying
notice relating to their own appointment. None of the other Directors, Key Managerial Personnel and relatives thereof is concerned
or interested in the Resolutions at item nos. 4 & 5.
During the year ended March 31, 2016, the Company had raised ` 4,512.53 Million through public issue, specifically to meet the
objects of the Offer. The utilisation of IPO proceeds during the year ended March 31, 2020, March 31, 2019 and March 31, 2018
against the objects of the Offer is as follows:
(` in Million)
Fund allocated to Actual Unutilised Actual Unutilised
the activities as utilization up to money as on utilization up to money as on
per prospectus March 31, 2020 March 31, 2020 March 31, 2019 March 31, 2019
Advertising and sales promotion 1,110.00 641.50 468.50 496.52 613.48
Capital expenditure on research 418.80 418.47 0.33 391.69 27.11
and development
Purchase, development and 275.95 188.72 87.23 188.72 87.23
renovation of office premises in
Kolkata, Pune and New Delhi
General corporate purposes 537.76 534.31 3.45 285.64 252.12
Total 2,342.51 1,783.00 559.51 1,362.57 979.94
There is an unspent amount of ` 468.50 Million as on March 31, 2020 under the object “Advertising and sales promotion”. In view of
the above, it is proposed to transfer ` 250.00 Million (the Part of unutilized funds) to category “General Corporate Purpose”, where
these funds will be utilized in full in next two years along with the existing unutilized funds in this category.
In terms of Section 27 of the Companies Act, 2013 a Company cannot vary the terms of objects referred to in the prospectus except
subject to the approval of or except on authority given by, the Company in a general meeting. Therefore, the Board of Directors
seeks approval of the Members for use/deployment of part of unutilized amount of the IPO proceeds under the object “Advertising
and sales promotion, which stood at ` 250.00 Million out of the current unspent amount of ` 468.50 Million as on March 31, 2020
for ‘’General Corporate Purposes’’. The Board of Directors also seeks approval of Members for varying the allocation of the
unutilized part of the IPO proceeds for the above stated objects.
52
Corporate Overview Statutory Reports Financial Statements
NOTES (Contd.)
None of the Directors and key managerial personnel (including (c) The aggregate of basic salary, allowances, perquisites
relatives of directors or key managerial personnel) of the and variable incentive of Mr. Kailash Katkar, shall not
Company is concerned or interested, financially or otherwise, be in excess of 2.5% of the Net Profit of the Company
in this resolution except to the extent of their shareholding and (computed in a manner laid down in Section 198 of the
the Board recommends the resolution to be passed as Special Companies Act, 2013) and payment of remuneration shall
Resolution. not be in excess of 5% of the Net Profit of the Company
to all Executive Directors of the Company for each of the
ITEM NO 7: Reappointment of Mr. Kailash Katkar as
financial years from 2020-21 and onwards with effect
Managing Director & CEO
from April 01, 2020 for a period of five years. The details
Mr. Kailash Katkar, aged 53 years, passed his matriculation of his directorships and membership of committees in
examination. He has been associated with the Company other companies are as follows as on March 31, 2020:
since its incorporation and has experience in general
Directorships:
management, strategy, sales, marketing, customer services
and administration. He is the recipient of several awards Name of the Company Designation
including “Entrepreneurs International Honors” for his Data Security Council of India Director
achievement as a first generation entrepreneur in 2002 by Mr. Katkar attended 7 out of 8 meetings of Board of
Charaiveti Entrepreneurs’ International, “GS Parkhe Industrial the Company during the year. Mr. Kailash Katkar holds
Merit Award 2009” awarded by The Maharashtra Chamber 1,87,94,713 equity shares in the Company as on March 31,
of Commerce, Industries and Agriculture, “Maxell Award 2020.
for Maharashtra Corporate Excellence, 2012 - Innovation”
If the Company incurs a loss or its profits are inadequate
awarded by the Maxell Foundation, “CMDA Achievement
in any financial year during the tenure of Mr. Kailash
Award 2010” awarded by the Computer and Media Dealers
Katkar, he may be paid such minimum remuneration as
Association, Pune, “Young Entrepreneurs Award 2012” by the
determined by the Board of Directors or the Nomination
Army Institute of Technology, Pune, “Rashtriya Sanman Award”
& Remuneration Committee of the Board of Directors,
by the National Education and Human Resources Development
within the limits laid down in Section II, Part II of Schedule
Organisation, “SME Entrepreneur – Achievers’ Award 2010-11”
V of the Companies Act, 2013. In such a case, the following
by SME Channels, and “Entrepreneur of the Year 2012” by
perquisites shall not be included in the computation of
Brands Academy. He was reappointed as Managing Director
the ceiling on remuneration in case the Company has
and Chief Executive Officer of the Company on August 28, inadequate profits or loss in that financial year.
2015.
(a) contribution to provident fund, superannuation fund
Brief terms and conditions of appointment of Mr. Kailash Katkar or annuity fund to the extent these either singly or put
are given below: together are not taxable under the Income-tax Act, 1961
(a) Mr. Kailash Katkar shall be paid basic salary, perquisites (43 of 1961);
and allowances in the range of ` 13 Million per annum to (b) gratuity payable at a rate not exceeding half a month’s
` 16 Million per annum. Within this range, the aggregate salary for each completed year of service; and
of basic salary, perquisites and allowances may be (c) encashment of leave at the end of the tenure.
revised by the Board of Directors or the Nomination &
Remuneration Committee from time to time, subject to Particulars as per Section II of Part II of Schedule V of the
maximum annual increase of 15% over the basic salary, Companies Act, 2013 are given below:
perquisites and allowances for the previous year. I. General Information:
1. Nature of industry: The Company is in the business of
(b) Variable incentive of such amount as may be decided by
providing security software products and solutions.
the Board of Directors or the Nomination & Remuneration
Committee of the Board of Directors, from time to time 2. Financial performance based on given indicators
subject to the prescribed limit given under Section 196, Please refer to Financial Statements attached to this
Section 197 and other applicable provisions, if any, of notice.
the Companies Act, 2013, read with Schedule V thereof
3. Foreign investments or collaborations, if any: During the
and the Rules made thereunder, including any statutory
year, the Company made a L7 Defense Ltd., Israel based
modification(s) or re-enactment thereof, for the time
Company.
being in force and SEBI LODR Regulations.
II. Information about the appointee: c) Total remuneration: Subject to an overall ceiling
1. Background details: Please refer to opening paragraphs of 10% the net profits of the Company for all the
in this item for these details. Executive Directors.
2. Past remuneration: During the financial year 2019-20, the d) Perquisites and other details: Please refer to
Company paid ` 14.88 Million to Mr. Kailash Katkar previous paragraphs in this item of business.
54
Corporate Overview Statutory Reports Financial Statements
NOTES (Contd.)
a) Honored with Maharashtra Corporate Excellence 6. Comparative remuneration profile with respect to
(MAXELL) Awards for Excellence in Entrepreneurship industry, size of the company, profile of position and
and for his contribution to the economic and person:
industrial development of Pune City.
The comparative remuneration in the Technology
b) Honored with the J Irwin Miller Award of Excellence Industry for companies with revenues in the range of
by Cummins for his commitment to conducting ` 15.96 Mn to ` 94.45 Mn for the position of a Chairman
business in an ethical manner and for the value KPIT & Executive Director (Whole-time Director) ranged from
partnership has brought to Cummins. ` 21.79 Mn to ` 81.12 Mn for the year 2019-20.
c) Conferred with the prestigious Samata Award by 7. Pecuniary relationship directly or indirectly with the
the Akhil Bhartiya Mahatma Phule Samata Parishad Company or relationship with the managerial personnel,
for his contribution to the economic and industrial if any:
development of Pune City.
Please refer Note No. 39 to the standalone financial
d) Awarded the prestigious Rotary Excellence statements attached.
Award for exemplary leadership and outstanding
III. Other information:
performance, by a chapter in Pune.
1. Reasons of loss or inadequate : Not applicable.
4. Job profile and his suitability: It is proposed to re-appoint profitst
Mr. Sanjay Katkar as a Joint Managing Director & CTO 2. Steps taken or proposed to be : Not applicable.
and Mr. Sanjay Katkar will be responsible for the technical taken for improvement
matters and development of business of the company. 3. Expected increase in productivity : Not applicable.
The previous paragraphs contain information on the and profits in measurable terms
suitability of Mr. Sanjay Katkar for the appointment. An agreement will be entered into between the Company
5. Remuneration proposed: and Mr. Sanjay Katkar subject to the approval of
shareholders in the ensuing AGM and the draft agreement
a) Fixed remuneration: Range of ` 10.98 Million per will be available for inspection at the registered office
annum to ` 25.00 Million per annum over the of the Company from Monday to Friday, between 11.00
tenure. a.m. to 1.00 p.m. upto the date of the AGM. As per the
b) Variable remuneration: As fixed by the Board provisions of Section 196 and 197 of the Companies
of Directors or the Nomination & Remuneration Act, 2013 the appointment of a Managing Director shall
Committee of the Board of Directors from time to be approved by the members at a general meeting of
time subject to the prescribed limit given under the Company. Mr. Sanjay Katkar is related to Mr. Kailash
Section 196, Section 197 and other applicable Katkar. Mr. Sanjay Katkar is brother of Mr. Kailash Katkar.
provisions, if any, of the Companies Act, 2013, Mr. Sanjay Katkar and his relatives will be concerned
read with Schedule V thereof and the Rules made or interested in the ordinary resolution to the extent of
thereunder, including any statutory modification(s) the remuneration payable to him under the authority of
or re-enactment thereof, for the time being in force the resolution. Except Mr. Kailash Katkar, none of the
and SEBI LODR Regulations. other Directors or key managerial personnel or relatives
of other directors or key managerial personnel is
c) Total remuneration: Subject to an overall ceiling
concerned or interested in the proposed resolution. The
of 10% the net profits of the Company for all the
Board of Directors recommends the Ordinary Resolution
Executive Directors.
set forth as Item No. 8 of the notice for approval of the
d) Perquisites and other details: Please refer to shareholders.
previous paragraphs in this item of business.
56
Corporate Overview Statutory Reports Financial Statements
NOTES (Contd.)
21. Pursuant to Regulation 36 of the SEBI LODR Regulations read with SS-2 on General Meetings effective 1 October 2017,
brief profile of the director eligible for re-appointment, vide item no. 3, 7 and 8 is as follows:
Particulars Mr. Kailash Katkar Mr. Sanjay Katkar
DIN 00397191 00397277
Date of Birth & Age November 01, 1966, Age: 53 November 29, 1970, Age: 49
Date of First Appointment to the Board August 7, 1995 August 7, 1995
Qualifications Matriculation Masters in Computer Science
Expertise in Specific Functional Areas Business Administration, general Development of anti-virus software,
management, strategy technology and related services
Experience Quick Heal Technologies Ltd Quick Heal Technologies Ltd
Directorship held in other listed entities Nil Nil
Membership/Chairmanship of Committees of Nil Nil
other listed entities (includes on Audit committee
& Stakeholders Relationship Committee)
Number of Equity Shares held in the Company 1,87,94,713 1,87,94,713
Relationship with any Director (s) and KMPs of Brother of Mr. Sanjay Katkar Brother of Mr. Kailash Katkar
the Company
Number of Meetings Attended During the year 07 08
Remuneration last drawn ` 14.88 millions ` 14.88 millions
Sd/-
Kailash Katkar
Managing Director & CEO Place: Pune
(DIN: 00397191) Date: May 21, 2020
Dear Members,
Quick Heal Technologies Limited
The Board of Directors of your Company is pleased to present the 25th Annual Report along with the audited financial statements,
for the financial year ended March 31, 2020.
1. Financial Results:
(` in Million)
Particulars Consolidated Standalone
2019-2020 2018-2019 2019-2020 2018-2019
Revenue from Operations (Net) 2,861.38 3,149.26 2,834.04 3,129.03
Other Income 315.96 326.67 313.41 325.00
Total Income 3,177.34 3,475.93 3,147.45 3,454.03
Profit Before Tax 1,013.11 1,370.19 1,004.40 1,290.70
Total Tax 269.00 451.95 268.01 451.06
Profit After Tax 744.11 918.24 736.39 839.64
The abovementioned figures are extracted from financial statements prepared in accordance with the Indian accounting
standards (IND AS).
In accordance with Regulation 43A of the SEBI LODR 5. Transfer of Profits to Reserves
Regulations the Company has formulated a Dividend Your Directors have decided not to transfer any amount
Distribution Policy. The dividend declared and paid by the to General Reserve and to carry forward the entire
Company for the financial year 2019-20, is in compliance surplus under the Statement of Profit & Loss.
with the Dividend Distribution Policy. The Dividend
As per section 69 of the Companies Act, 2013, the
Distribution Policy of the Company is also hosted on the
Company has created Capital Redemption Reserve of `
website of the Company and can be viewed at https://
63.64 Million which is equal to the nominal value of the
www.quickheal.co.in/investors/company-policies.
shares bought back as an appropriation from Securities
Premium Reserve.
58
Corporate Overview Statutory Reports Financial Statements
15. Directors & Key Managerial Personnel meetings did not exceed prescribed period of one
As on March 31, 2020, the Board comprised of two hundred twenty days. The particulars of directors present
Executive Directors, four Non-Executive Independent at various Board and Committee meetings are given in
Directors and one Non-Executive Director. The Board is the Corporate Governance Report which forms part of
well diversified and consists of two Women Independent this Report.
Directors.
17. Directors’ Responsibility Statement
Mr. Kailash Katkar (DIN: 00397191), Managing Director Pursuant to Section 134(5) of the Companies Act, 2013,
& CEO of the Company, retires by rotation at the the Board of Directors of your Company to the best of
ensuing AGM and, being eligible, offers himself for re- their knowledge and ability hereby state and confirm
appointment. A Profile of Mr. Kailash Katkar, as required that:
by Regulation 36(3) of the SEBI LODR Regulations are
given in the Notice convening the forthcoming AGM. a) In the preparation of the annual accounts for the year
ended March 31, 2020, the applicable accounting
During the year Mr. Kailash Katkar, Managing Director standards have been followed along with proper
& CEO and Mr. Sanjay Katkar, Joint Managing Director explanation relating to material departures;
& CTO whose term of appointment expired on March
31, 2020 were re-appointed, subject to the approval of b) They have selected such accounting policies and
shareholders, on the same terms and conditions, as per applied them consistently and made judgments and
the recommendation of Nomination and Remuneration estimates that are reasonable and prudent so as to
Committee, by the Board on February 24, 2020 for a give a true and fair view of the state of affairs of the
further term of 5 years w.e.f April 01, 2020. company at the end of the financial year and of the
profit of the company for the same period;
Mr. Kailash Katkar, Managing Director & CEO, Mr. Sanjay
Katkar, Joint Managing Director & CTO, Mr. Nitin Kulkarni, c) The Directors have taken proper and sufficient
Chief Financial Officer and Mr. Srinivasa Rao Anasingaraju, care for the maintenance of adequate accounting
Company Secretary are the Key Managerial Personnel of records in accordance with the provisions of the
the Company within the meaning of sections 2(51) and Companies Act, 2013 for safeguarding the assets
203 of the Companies Act, 2013 read together with the of the company and for preventing and detecting
Companies (Appointment & Remuneration of Managerial fraud and other irregularities;
Personnel) Rules, 2014, as on March 31, 2020. d) The annual accounts have been prepared on a
During the year Mr. Pradeep V. Bhide and Mr. Manu going concern basis;
Parpia, Independent Directors of the Company, resigned e) Proper internal financial controls have been laid
as members of the Board effective April 01, 2019 and down in the company that are adequate and were
May 11, 2019 respectively. The Board places on record operating effectively.
appreciation for their contributions towards the growth of
f) Proper systems to ensure compliance with the
the Company during their tenure of directorship.
provisions of all applicable laws have been devised
Mr. Amitabha Mukhopadhyay was appointed as an and such systems are adequate and are operating
Independent Director of the Company for a term of five effectively.
years on June 10, 2019 and the same was confirmed by
the members in the last AGM of the company held on 18. Declaration of Independence by Independent
July 15, 2019. Directors
The Company has received necessary declarations
16. Board Meetings
from each Independent Director under section 149(7) of
During the financial year 2019-20, 8 (eight) Board the Companies Act, 2013 that he/she fulfils the criteria
meetings were held on April 04, 2019, May 10, 2019, July of independence laid down in Section 149(6) of the
15, 2019, August 08, 2019, October 22, 2019, November Companies Act, 2013 and Regulation 25 of SEBI LODR
14, 2019, February 05, 2020 and February 24, 2020 Regulations.
respectively. The maximum time gap between any two
60
Corporate Overview Statutory Reports Financial Statements
The Independent Directors have complied with the Code experience in their respective fields and the substantial
for Independent Directors prescribed in Schedule IV to contribution made by these Directors during their
the Act and the Code of Conduct for Directors and senior first tenure as an Independent Directors since their
management personnel of the Company. appointment, has recommended to the Board that
continued association of these Directors as Independent
Based on the confirmations/disclosures received from
Directors would be in the interest of the Company.
the Directors under Section 149(7) of the Companies Act
2013 and on evaluation of the relationships disclosed, 19. Performance Evaluation of the Board, its
the following Non-Executive Directors are considered as Committees and Directors
Independent Directors:
The Board has established a comprehensive process to
a. Mr. Amitabha Mukhopadhyay evaluate the performance of the Directors, Committee
b. Ms. Priti Rao and the Board. The performance evaluation matrix
defining the criteria of evaluation for each of the above
c. Mr. Mehul Savla
has been put in place. The performance evaluation of
d. Ms. Apurva Joshi the Independent Directors was carried out by the Board
The first tem of five years of Ms. Apurva Joshi and Mr. (excluding the Director being evaluated). A meeting of
Mehul Savla as Independent Directors of the Company the Independent Directors was held on February 05,
is going to end on the date of ensuing AGM of the 2020 to review the performance of Non-Independent
Company. In this regard, the Nomination & Remuneration Directors and the Board as a whole. The Chairman of the
Committee at its Meeting held on May 20, 2020 after Nomination & Remuneration Committee had updated the
taking into account the performance evaluation of these other members of the Board about the outcome of the
Independent Directors, during their first term of five years process.
and considering the knowledge, acumen, expertise and
The Secretarial Auditor’s Report forms part of this Annual 27. Employee Stock Option Scheme
Report, annexed as Annexure B.
Your Company has two Employee Stock Option Plans
22. Statutory Auditors namely, Employees Stock Option Scheme 2010 and
Employees Stock Option Scheme 2014 for granting
M/s MSKA & Associates, Chartered Accountants (Firm
Term based and performance based Stock Options to
Registration No. 105047W), were appointed by the
Employees.
Shareholders at the 24th AGM held on July 15, 2019 as
Statutory Auditors for a term of five consecutive years to During the year under report, no employee has been
hold office until conclusion of 29th AGM. Pursuant to the granted stock options, equal to or exceeding 1% of the
amendment to Section 139 of the Companies Act, 2013 issued capital (excluding outstanding warrants and
effective from May 07, 2018, ratification by shareholders conversions) of your Company. The details of activities
every year for the appointment of Statutory Auditors is no under the scheme have been summarized in the Notes
longer required and accordingly, the Notice of ensuing forming part of Financial Statements and annexed as
25th AGM does not include the proposal for seeking Annexure D.
shareholders’ approval for ratification of Statutory
28.
Conservation of Energy, Technology
Auditors appointment.
Absorption and Foreign Exchange Earnings
23. Audit Observations and Outgo
There is no Audit observation during the financial year. Particulars required to be furnished under the Companies
The Statutory Auditors have not reported any fraud (Disclosure of Particulars in the Report of Board of
during the financial year. Directors) Rules, 1988 are as under:
Pursuant to the provisions of Section 148(3) of the The operations of the Company involve low energy
Companies Act, 2013 and applicable rules, the Board consumption. The Company has ensured that
has appointed M/s. Bhavesh Marolia & Associates, as adequate measures are being taken to conserve
the Cost Auditors of the Company to conduct an audit energy.
of cost records maintained by the Company for the • Technology Absorption, Adaptation and
financial year 2020-21 at a remuneration of ` 70,000/- Innovation
plus applicable taxes and out of pocket expenses. The
The Company continues to use the latest
same was already approved by shareholders in the 24th
technology for improving the productivity and
AGM of the Company.
quality of its products and services and also focuses
25. Internal Auditors on innovation and protecting consumers around
the world with latest technology. With its continued
The Board appointed Ernst & Young LLP, Chartered
focus on R&D, the Company aims at releasing
Accountants, as Internal Auditors of the Company for the
newer features as well as newer products in retail
financial year 2020-21.
as well as enterprise & government segment.
62
Corporate Overview Statutory Reports Financial Statements
The company has intensified its efforts on unique its CSR objects through the Foundation. The Company
opportunities which the small and mid-size strives to promote Cybersecurity awareness, promotion
businesses are projecting with the digitization of of education and community development. The
India. Developing products that will address the Company’s CSR policy is available on our website at
cyber threats to these businesses and protecting https://www.quickheal.co.in/investors/company-policies.
their valuable data is an important area where the
During the year under review, the Company had spent
Company is innovating. In coming years, more
` 22,850,000/- on CSR activities, out of the total amount
investment will go into R&D of several technologies
of ` 23,826,867/- as per provisions of the Section 135
targeted towards products for enterprise,
of the Companies Act, 2013. Your Company was in the
government and retail segments of your Company.
process of further identifying worthwhile avenues for CSR
• Foreign Exchange earnings and outgo: expenditure during the year and in its absence, there
Total foreign exchange earnings and outgo for the was unspent of ` 976,867/-. The Company continues to
financial year were as follows: remain committed towards undertaking CSR activities for
the welfare of the society.
(` in Million)
Year ended Year ended A Report on CSR activities of your Company under
March 31, 2020 March 31, 2019 the provisions of the Companies Act, 2013 during the
Total foreign 45.90 47.11 financial year 2019-20 is given as Annexure ‘F’.
exchange
outgo 32. Adequacy of Internal Financial Controls
Total foreign 83.67 78.98 The Board of Directors of your Company are responsible
exchange for ensuring that the Internal Financial Controls (“IFC”)
earnings
are laid down in the Company and that such controls are
29. Particulars of Loans, Guarantees and adequate and are operating efficiently and effectively.
Investments The Company’s IFC policies are commensurate with
its requirements and are operating effectively. The IFC
There is no Loans, Guarantees as on March 31, 2020.
covered the policies and procedures adopted by the
However there is one investment as on March 31, 2020
Company for ensuring orderly and efficient conduct
the details of which is given under Notes to the financial
of business including adherence to the Company’s
statements.
policies, safeguarding of the assets of the Company,
30. Related Party Transactions prevention and detection of fraud and errors, accuracy
and completeness of accounting records and the timely
All the related party transactions carried out during the
preparation of reliable financial information.
year were carried out at arm’s length basis and in ordinary
course of business. There were no materially significant 33. Vigil Mechanism (Whistle Blower Policy)
related party transactions with the Company’s Promoters,
The Company has a well laid down Vigil Mechanism
Directors, Management or their relatives, which could
(Whistle Blower Policy), details of which are given in the
have had a potential conflict with the interests of the
Report on Corporate Governance forming a part of this
Company.
Annual Report. The Company has also uploaded the
All the transactions with related parties were approved said Whistle Blower Policy on its website at https://www.
by the Audit Committee and the Board of Directors. The quickheal.co.in/investors/company-policies.
particulars of contracts entered during the year are given
in Form AOC-2 enclosed as Annexure E. 34. Risk Management Policy
The Audit Committee also functions as the Risk
31. Corporate Social Responsibility (‘’CSR’’) Management Committee. The Company has put in
Your Company has a strong commitment towards the place a robust Risk Management Policy which facilitates
society we live in. Your Company had formed a public identification of risks and also mitigation thereof. The Audit
charitable trust ‘Quick Heal Foundation’ and implements Committee is updated on the risks on a quarterly basis.
There are no risks which in the opinion of your directors 37. Extract of Annual Return
threaten the existence of the Company. However, risks The details forming part of the extract of Annual
that may pose a concern including impact of COVID-19 Report, as on March 31, 2020, in Form MGT – 9 is
are explained under Management Discussion and given as per Annexure-G. The same is also available
Analysis which forms part of this Annual Report. on https://www.quickheal.co.in/investors/financial-
information#annualResults
35. Investor Education and Protection Fund:
In accordance with the provisions of Sections 124 and 125 38. Disclosure under the Sexual Harassment
of the Act and Investor Education and Protection Fund of Women at Workplace (Prevention,
(Accounting, Audit, Transfer and Refund) Rules, 2016 Prohibition and Redressal) Act, 2013
(“IEPF Rules”), dividends of a company which remain The Company has in place an Anti-Sexual Harassment
unpaid or unclaimed for a period of seven years from Policy in line with requirements of the Sexual Harassment
the date of transfer to the Unpaid Dividend Account shall of Women at Workplace (Prevention, Prohibition and
be transferred by the company to the Investor Education Redressal) Act, 2013. All employees (permanent,
and Protection Fund (“IEPF”). In terms of the foregoing contractual, temporary, trainees) are covered under this
provisions of the Act, no dividend amount or shares were policy. Internal Committee(s) has been set up across
required to be transferred to the IEPF by the Company all its required locations in India to address complaints
during the year ended March 31, 2020. received regarding sexual harassment.
36. Other matters There were no complaints reported during the financial
Your Directors state that during the financial year under year 2019-20.
review -
39. Material Changes/Events after balance
i. Neither the Managing Director nor the Whole-time sheet date
Director of the Company received any remuneration There were no material changes and commitments
or commission from any of its subsidiaries. affecting the financial position during the period since
ii. The Company has complied with applicable the end of the financial year till the date of this report.
Secretarial Standards issued by the Institute of
40. Acknowledgments
Company Secretaries of India on Meetings of the
Your Board places on record sincere gratitude and
Board of Directors and General Meetings;
appreciation for all the employees. The Board conveys
iii. No significant or material orders were passed by its appreciation for its customers, vendors, investors,
the Regulators or Courts or Tribunals which impact bankers, end users, dealers, distributors, business
the going concern status and the Company’s partners and other business constituents during the year
operations in future. under review. We also thank the support received from
various government and regulatory authorities.
Sd/- Sd/-
Kailash Katkar Sanjay Katkar
Managing Director & CEO Joint Managing Director & CTO
(DIN: 00397191) (DIN: 00397277)
Place: Pune
Date: May 21, 2020
64
Corporate Overview Statutory Reports Financial Statements
Annexure A
Secretarial Audit was conducted for the year ended March 31, (b) The Securities and Exchange Board of India
2020, in a manner that provided me a reasonable basis for (Prohibition of Insider Trading) Regulations, 2015;
evaluating the corporate conducts/statutory compliances of
(c) The Securities and Exchange Board of India (Issue of
the Company and expressing my opinion thereon.
Capital and Disclosure Requirements) Regulations,
Based on my verification of the Company’s books, papers, 2009;
minute books, forms and returns filed and other records
(d) The Securities and Exchange Board of India
maintained by the Company and also the information
(Employee Stock Option Scheme and Employee
provided by the Company, its officers, agents and authorized
Stock Purchase Scheme) Guidelines, 1999 and the
representatives during the conduct of secretarial audit and
Securities And Exchange Board Of India (Share
considering the relaxations granted the Ministry of Corporate
Based Employee Benefits) Regulations, 2014;
Affairs and Securities and Exchange Board of India warranted
due to the spread of the COVID-19 pandemic, I hereby report (e) The Securities and Exchange Board of India
that in my opinion, the Company has, for the year ended (Delisting of Equity Shares) Regulations, 2009; [Not
March 31, 2020 (“Audit Period”), complied with the statutory applicable during the Audit Period]
provisions listed hereunder and also that the Company has (f) The Securities and Exchange Board of India (Issue
proper Board-processes and legal compliance mechanism in and Listing of Debt Securities) Regulations, 2008;
place to the extent, in the manner and subject to the reporting [Not applicable during the Audit Period]
made hereinafter:
(g) The Securities and Exchange Board of India
I have examined the books, papers, minute books, forms and (Registrars to an Issue and Share Transfer Agents)
returns filed and other records maintained by the Company for Regulations, 1993 regarding the Companies Act and
the year ended March 31, 2020 according to the provisions of dealing with client;
the following list of laws and regulations:
(h) The Securities and Exchange Board of India
(i) The Companies Act, 2013 (the Act) and the rules made (Buyback of Securities) Regulations, 1998; : The
there under; Company had concluded the process of buy back
(ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) of shares successfully and has dissolved the
and the rules made there under; Buyback committee during the audit period.
(iii) The Depositories Act, 1996 and the Regulations and Bye- (vi) I further report that having regarded to the compliance
laws framed there under; system prevailing in the company and on examination
of the relevant documents and records in pursuance
66
Corporate Overview Statutory Reports Financial Statements
Annexure B (Contd.)
thereof the company has complied with the following 2. The Company has completed the buy-back of
laws applicable specifically to the company: 63,63,636 equity shares of ` 10 each being 23.87%
of the total paid up equity share capital, at ` 275/-
a) The Information Technology Act, 2000
per equity share in June 2019.
I have also examined compliance with the applicable
3. Mr. Amitabh Mukhopadhyay was appointed as
clauses of the following:
an Independent Director on 10th June, 2019 for a
i. Secretarial Standards issued by The Institute of term of 5 years from 10th June, 2019 to 09th June,
Company Secretaries of India. 2024; which was confirmed with the approval of
ii. The Listing Agreement entered into by the Company shareholders by way of a Special Resolution in the
with National Stock Exchange of India Limited and 24th Annual General Meeting held on 15th July,
BSE Limited and SEBI (Listing Obligations And 2019.
Disclosure Requirements) Regulations, 2015 4. The Statutory Auditors of the Company- S R B C &
During the period under review the Company has CO LLP completed their term of 10 years. M/s. MSKA
complied with the provisions of the Act, Rules, Regulations, & Associates (Firm Registration No. 105047W),
Guidelines, Standards, etc. mentioned above. Chartered Accountants were appointed from the
conclusion of 24th Annual General Meeting to the
I further report that:- conclusion of 29th Annual General Meeting by
The Board of Directors of the Company is duly approval by Members of the Company in the 24th
constituted with proper balance of Executive Directors, Annual General Meeting.
Non-Executive Directors and Independent Directors. 5. The Company has received approval from
Adequate notice is given to all directors to schedule the shareholders in the 24th Annual General Meeting
Board Meetings along with agenda and detailed notes for variation in utilisation of the IPO proceeds.
on agenda in advance, and a system exists for seeking 6. The Company in the Board meeting dated February
and obtaining further information and clarifications on 24, 2020 has appointed Mr. Kailash Sahebrao
the agenda items before the meeting and for meaningful Katkar as Managing Director for second term of 5
participation at the meeting. years with effect from April 1, 2020.
Majority decision is carried through while the dissenting 7. The Company in the Board meeting dated February
members’ views are captured and recorded as part of 24, 2020 has appointed Mr. Sanjay Sahebrao Katkar
the minutes. as Managing Director for second term of 5 years
I further report that there are adequate systems and with effect from April 1, 2020.
processes in the Company commensurate with the size This Report should be read along with Annexure to the
and operations of the Company to monitor and ensure Report which shall be considered to form part of this
compliance with applicable laws, rules, regulations and Report for all purposes.
guidelines.
In accordance with the ICSI Auditing Standards (CSA1 to CSA4), the undersigned wish to state as under-
My responsibility as the Auditor is to express the opinion on the compliance with the applicable laws and maintenance of Records
based on Secretarial Audit conducted by me.
The Secretarial Audit needs to be conducted in accordance with applicable Auditing Standards. These Standards require that the
Auditor should comply with statutory and regulatory requirements and plan and perform the audit to obtain reasonable assurance
about compliance with applicable laws and maintenance of Records.
I am also responsible to perform procedures to identify, assess and respond to the risks of material misstatement or non-compliance
arising from the Company’s failure appropriately to account for or disclose an event or transaction. However, due to the inherent
limitations of an audit including internal, financial and operating controls, there is an unavoidable risk that some Misstatements or
material non-compliances may not be detected, even though the audit was properly planned and performed in accordance with
the Standards.
Accordingly, in my opinion,
1. The Secretarial Audit for the financial year 2019-2020 has been conducted as per the applicable Auditing Standards.
2. I have obtained reasonable assurance that the statements prepared, documents or Records maintained by the Company are
free from misstatement.
3. My responsibility is limited to only express my opinion on the basis of evidences collected, information received and Records
maintained by the Company or given by the Management.
4. The Company has followed applicable laws, act, rules or regulations in maintaining their Records, documents, statements and
has complied with applicable laws or rules while performing any corporate action.
5. Due to COVID-19 pandemic and subsequent lockdown declared by the Central, State and Local governments, physical
verification of documents/ registers/ papers was not possible and hence, we have relied on the scanned copies / emails/
digitally accessible data, information, registers, documents and papers provided by the Company for carrying out the
Secretarial Audit and to that extent our verification of documents and records might have been impacted.
Jayavant B. Bhave
Proprietor
FCS: 4266 CP: 3068
Place: Pune PR No.: 486/ 2016
Date: May 20, 2020 UDIN: F004266B000260093
68
Corporate Overview Statutory Reports Financial Statements
Annexure C
A. Details of the Remuneration as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
1. The percentage increase in remuneration of each Director, Chief Financial Officer and Company Secretary during the financial
year 2019-20, ratio of the remuneration of each Director to the median remuneration of the employees of the Company for
the financial year 2019-20 and the comparison of remuneration of each Key Managerial Personnel (KMP) on CTC basis per
annum, against the performance of the Company are as follows:
Sr. Name of Director / KMP & Designation Remuneration of % increase (decrease) Ratio of Remuneration
No Director / KMP for the in Remuneration in of each Director to the
FY 2019-20 (` Million) the FY 2019-20 Median remuneration
of Employees
1. Kailash Katkar, 14.88 Nil 23.92
Chief Executive Officer & MD
2. Sanjay Katkar, 14.88 Nil 23.92
Jt. MD & Chief Technical Officer
3. Shailesh Lakhani Nil Nil -
Non–Executive Director
4. Mehul Savla 0.45 (16.67%) 0.72
Independent Director
5. P V Bhide * Nil Nil -
Independent Director
6. Apurva Joshi 0.45 (16.67%) 0.72
Independent Director
7. Manu Parpia π Nil Nil -
Independent Director
8. Priti Rao 0.45 (16.67%) 0.72
Independent Director
9 Amitabha Mukhopadhyay @ 0.60 Nil 0.96
10. Nitin Kulkarni, 6.42 7% 10.32
Chief Finance Officer
11. Srinivasa Rao Anasingaraju # 3.70 Nil 5.95
Company Secretary
* Ceased to be Director of the Company effective April 01, 2019.
π Ceased to be Director of the Company effective in May 11, 2019
@ Appointed as Independent Director effective July 15, 2019
# Appointed as Company Secretary effective May 10, 2019.
2. The median remuneration of employees of the company during financial year 2019-20 was ` 6,22,169/-
3. In the financial year 2019-20, there was an increase of 3.69% in the median remuneration of the employees as compared to
that of 2018-19.
4. As on March 31, 2020 there were 942 permanent employees who were on rolls of the Company.
5. Relationship between average salary increase in remuneration & Company’s performance: The Profit After Tax (PAT) for the
financial year ended March 31, 2020 decreased by 18.96% whereas the median remuneration increased by 3.69%
6. Comparison of remuneration of the Key Managerial Personnel(s) against the performance of the Company: The total
remuneration of the Key Managerial Personnel(s) increased by 11.52% from ` 35.76 Million in 2018-19 to ` 39.88 Million in
2019-20, whereas Profit After Tax decreased by 18.96% from ` 918.24 Million in 2018-19 to ` 744.11 Million in 2019-20.
7. The average percentage increase in salaries of employees excluding Key Managerial Personnel(s) was 8.21% over the
previous year. The average increase in salaries of Key Managerial Personnel(s) was 2.3%. The increase in KMP remuneration
were based on the recommendations of the ‘Nominations & Remuneration Committee’ as per the industry benchmark.
8. All remuneration paid is as per the Remuneration Policy of the Company.
B. Details of the employees who were employed throughout the financial year and received a remuneration of ` 10.02
Million or above per annum OR the employees who were employed for a part of the financial year and received
remuneration of ` 0.85 Million p.m. under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:
Name Designation Qualifica- Age Joining Expe- Nature of Total Previous Relation-
tion (Yrs.) Date rience Employ- Remu- Employ- ship with
(Yrs.) ment neration ment any Direc-
(in ` tor of the
Million) Company
Kailash Katkar Managing Matriculation 53 7th August 32 Permanent 14.88 Promoter Brother of
Director & 1995 Mr. Sanjay
CEO Katkar
Sanjay Katkar Joint Master in 49 7th August 23 Permanent 14.88 Promoter Brother of
Managing Computer 1995 Mr. Kailash
Director & Science Katkar
CTO
Vijay Mhaskar Chief Master in 53 16th 33 Permanent 6.59 Avaya India No
# Operating Computer September Pvt. Ltd.
Officer Science 2016
Nagesh Vice Master in 48 2nd April 31 Permanent 10.92 McAfee No
Ayyagari ~ President- Computer 2018 Software
Engineering Science India Pvt
Ltd.
Kuldeep Vice Bachelor in 50 17th June 26 Permanent 17.36 ColorTokens No
Raina President & Computer 2019 India LLP
Global Head Science &
Of Sales Engineering
*Total Remuneration includes salary, allowances, bonus and perquisites.
# ceased to be Employee of the Company effective October 11, 2019
~ ceased to be Employee of the Company effective January 17, 2020
Pursuant to Rule 5(2)(3) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, Mr. Vijay
Mhaskar, Mr. Nagesh Ayyagari and Mr. Kuldeep Raina are not holding 2% or more of the equity shares of the Company
respectively.
Particulars of employees posted and working in a country outside India, not being directors or their relatives, drawing more
than ` 1.02 Crores per annum or ` 8.5 lakhs per month, as the case may be, as may be decided by the Board, shall not be
circulated to the members in the Board’s report, but such particulars shall be filed with the Registrar of Companies while filing
the financial statement and Board Reports. NIL
70
Corporate Overview Statutory Reports Financial Statements
Annexure C (Contd.)
Information as per Rule 5(2) of Chapter XIII of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014
Top ten employees in terms of remuneration drawn during the financial year 2019-20:
Name Designation Qualifica- Age Joining Experi- Nature of Total Remu- Previous Em- Relation-
tion (Yrs.) Date ence Employ- neration ` ployment ship with
(Yrs.) ment any Direc-
tor of the
Company
Sameer Joshi * Head - MBA 46 12-Feb- 20.1 Permanent 1,00,00,000 Amazon Web No
Strategy 2020 Service
Reetu Raina CHRO MBA (HR) 44 23-Dec- 19.8 Permanent 95,00,000 Sterlite No
2019 Technologies
Ltd
Netra Deshpande Senior Bachelor of 46 02-May- 25.1 Permanent 68,84,713 Avya India Pvt No
Director - Engineering 2017 Ltd
Engineering (Computer
Science )
Malini Sathi # Senior MBA ( 51 23-Nov- 28.2 Permanent 68,13,793 Radius Global No
General Marketing) 2015 Services
Manager
- HR
Abhijit Kulkarni $ Head - MCS 40 01-Jan- 17.8 Permanent 63,38,854 -- No
Security (Computer 2002
Labs Science)
Amit Madhav Regional Advanced 45 01-Jul- 14.11 Permanent 62,00,000 McAfee No
Deshmukh Sales Diploma - 2019 Software Ind
Director Computer Pvt Ltd
Software
Deepak Mishra Head - Retail MBA – 43 21-Aug- 20.9 Permanent 61,09,136 Tally Solutions No
Sales Marketing 2017 Pvt Ltd
Prakash Jagdale Associate BCS 40 01-Jan- 17.3 Permanent 61,05,974 -- No
Technical (Computer 2003
Director science )
Himanshu Dubey Director Bachelor of 35 07-Jan- 13.4 Permanent 58,50,000 RSi Retail No
- Security Technology 2019 Solutions Pvt
Labs – B Tech - Ltd
Computer
Engineering
Chandrashekhar Head - IT Masters in 55 19-Nov- 31.6 Permanent 54,00,000 Mphasis Ltd No
Shrikantiah Science 2018
(Electronics,
Computer
Science)
72
Corporate Overview Statutory Reports Financial Statements
Annexure D (Contd.)
Particulars Details
ESOP 2010 ESOP 2014
Description of the method and significant assumptions Our Company has adopted discounted cash flow method to estimate
used during the year to estimate the fair values of the fair value of the options with the following assumptions:
options, including weighted-average information, i. Risk free interest rate: 6.62%;
namely, risk-free interest rate, expected life, expected
ii. Expected life: Grant IV:3.64 - 6.50
volatility, expected dividends and the price of the
underlying share in market at the time of grant of the Grant VI: 3.50 - 6.50
option Grant VII: 3.50 - 6.51
Grant VIII: 3.50 - 6.51
Grant IX: 3.50 - 6.51
Grant X : 3.64 – 6.64
Grant XI: 3.50 – 6.51
Grant XII: 3.76 - 6.51
Grant XIII: 3.50-6.76
Grant XIV: 3.50-6.51
Grant XV: 3.50-7.57
Grant XVI: 3.50-6.51
Grant XVII: 3.50-6.50
iii. Expected volatility: 27%
iv. Expected dividends: 1.21%
v. Price of underlying share in market at the time of Grant XVII of
option: ` 123.60
Vesting schedule Options are vested in four instalments based on performance of the
employee.
Lock-in Nil
Impact on liability for options outstanding of the last two Fiscal 2019-20: ` 1.70 Million
years on fair value Fiscal 2018-19: ` 7.25 Million
Note 1: Details regarding options granted to our Directors and key management personnel are set forth below under ESOP
2010:
Name of director/ Total No. of Total No. of No. of options No. of options Total No.
Key Management options granted options vested* exercised forfeited of options
Personnel outstanding*
NONE
* Options are vested based on the performance of the employee
Note 2: Details regarding options granted to our Directors and key management personnel are set forth below under ESOP
2014:
Name of director/ Total No. of Total No. of No. of options No. of options Total No.
Key Management options granted options vested* exercised forfeited of options
Personnel outstanding**
Nitin Kulkarni 100,000 25,000 Nil Nil 100,000
** Options are vested based on the performance of the employee
Note 3: Employee who received a grant of options amounting to 5% or more of the options granted during the year 2019-20
Name of Employee Total No. of options granted grant price
Kuldeep Raina 50,000 123.60
FORM AOC-2
(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule (2) of the Companies (Accounts) Rules, 2014)
Form for Disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub
section (1) of section 188 of the Companies Act, 2013 including certain arm’s length transaction under third proviso is given below:
Contract 2
Sr. Particulars Details
No.
a) Name (s) of the related party Mr. Kailash Katkar
b) Nature of Relation ship Managing Director & CEO
c) Nature of contracts / arrangements /transaction Leave & License
d) Duration of the contracts/ arrangements / transaction 1 year
e) Salient terms of the contracts or arrangements or transaction Hiring of Property
f) Justification for entering into such contracts or arrangements or transactions Approval of board obtained on
May 10, 2019
g) Contract Value per year (` in Million) 1.02
74
Corporate Overview Statutory Reports Financial Statements
Annexure F
(c) Manner in which the amount spent during the financial year is detailed below:
(1) (2) (3) (4) (5) (6) (7) (8)
Sr. CSR Project Sector in which Projects or Amount (in `) Amount (in Cumulative Amount
No. or activity project is programs outlay (budget) `) spent on expenditure up spent Direct
identified covered projects or projects or to the reporting or through
a) Local area or
programs wise programs period (in `) implementing
other
agency
1. Direct on
b) Specify
projects or
the state and
programs
district where
projects or 2. Overheads
programs was
undertaken
1. Education, Cyber Maharashtra 22,850,000 22,850,000 22,850,000 Through
Social Awareness, Quick Heal
Activity & Environmental Foundation
Administrative sustainability
Overheads
Total 22,850,000 22,850,000 22,850,000
76
Corporate Overview Statutory Reports Financial Statements
Annexure G (Contd.)
IV. Shareholding Pattern (Equity Share Capital Break-up as percentage of Total Equity)
i. Category-wise Shareholding
Category of No. of Shares held at the beginning of the year No. of Shares held at the end of the year %
Shareholders Demat Physical Total % of Demat Physical Total % of Change
Total Total during
Shares Shares the year
A. Promoters
1 Indian
a. Individual / HUF 51,030,720 – 51,030,720 72.32 51,030,720 – 46,762,345 72.83 0.51
b. Central Govt. – – – – – – – – –
c. State Govt.(s) – – – – – – – – –
d. Bodies Corporate – – – – – – – – –
e. Banks / FIs – – – – – – – – –
f. Any other: Relatives of
Promoters
Sub-total (A)(1) 51,030,720 – 51,030,720 72.32 51,030,720 – 46,762,345 72.83 0.51
2 Foreign
a. NRI Individuals – – – – – – – – –
b. Other Individuals – – – – – – – – –
d. Banks / FIs – – – – – – – – –
e. Any other – – – – – – – – –
Sub-total (A)(2) – – – – – – – – –
Total Shareholding of
Promoter
(A) = (A)(1) + (A)(2) 51,030,720 – 51,030,720 72.32 51,030,720 – 46,762,345 72.83 0.51
B. Public Shareholding
1 Institutions – – – – – – – – –
a. Mutual Funds / UTI – – – – - - - - –
b. Banks / FIs 80,562 – 80,562 0.11 82,491 – 82,491 0.12 0.01
c. Central Govt. – – – – – – – – –
d. State Govt.(s) – – – – – – – – –
e. Venture Capital – – – – – – – – –
Funds
f. Insurance - - - -
Companies
g. FIIs – – – – – – – – –
h. Foreign Venture 3,665,410 – 3,665,410 5.19 3,256,661 – 3,256,661 5.07 (0.12)
Capital funds
i. Others Foreign Co. – – – – – – – – –
j. Foreign Portfolio 17,83,834 17,83,834 2.53 14,19,809 14,19,809 2.21 (0.32)
Investor
Sub-total (B)(1) 5529806 - 5529806 7.83 47,58,961 47,58,961 7.40 0.43
2 Non-institutions
a. Bodies Corp. 17,21,067 17,21,067 2.44 11,84,945 11,84,945 1.85 (0.59)
(Indian and
Overseas)
i) Individual 71,90,255 1 71,90,256 10.18 81,69,570 1 81,69,571 12.72 2.54
shareholders
holding nominal
share capital upto `
1 Lakh
Category of No. of Shares held at the beginning of the year No. of Shares held at the end of the year %
Shareholders Demat Physical Total % of Demat Physical Total % of Change
Total Total during
Shares Shares the year
ii) Individual 32,70,647 32,70,647 4.63 20,74,411 20,74,411 3.23 (1.40)
shareholders
holding nominal
share capital in
excess of ` 1 Lakh
c. Others – – – – – – – – –
i) Clearing Member 2,03,161 2,03,161 0.29 1,16,280 1,16,280 0.18 (0.11)
ii) NBFCs registered 1,87,506 – 1,87,506 0.27 5,237 – 5,237 0.00 (0.26)
with RBI
iii) Foreign National 1,000 1,000 0.0014 889 889 0.0014 –
iv) NRI 7,77,391 7,77,391 1.10 4,18,252 4,18,252 0.65 0.45
v) Hindu undivided 6,51,900 6,51,900 0.92 7,12,655 7,12,655 1.11 0.18
Family
vi) Trust 200 200 0.0003 72 72 0.0001 (0.0002)
Sub-total (B)(2) 1,40,03,127 1 1,40,03,128 19.83 1,26,82,312 1 1,26,82,313 19.74 0.09
Total Public 19,53,22,933 1 19,53,22,934 1,74,41,272 1 1,74,41,273 -
Shareholding (B) = (B)
(1) + (B)(2)
C. Shares held by – – – – – – – – –
Custodian for GDRs /
ADRs
D. Grand Total (A+B+C) 7,05,63,653 1 7,05,63,654 100 6,42,03,617 1 6,42,03,618 100 –
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Corporate Overview Statutory Reports Financial Statements
Annexure G (Contd.)
Sr. Name & Type of Transaction Shareholding at the Transactions during the Cumulative Shareholding at
No. beginning of the year - 2019 year the end of the year - 2020
No. of Shares % of Total Date of No. of No. of % of Total
Held Shares of the Transaction Shares Shares Held Shares of the
Company Company
3 ANUPAMA KAILASH KATKAR 5003976 7.09 5003976 7.09
Transfer 14 Jun 2019 (418800) 4585176 7.14
AT THE END OF THE YEAR 4585176 7.14
4 CHHAYA SANJAY KATKAR 5003976 7.09 5003976 7.09
Transfer 14 Jun 2019 (418800) 4585176 7.14
AT THE END OF THE YEAR 4585176 7.14
5 SNEHA KAILASH KATKAR 0 0.0000 0 0.00
Transfer 20 Mar 2020 2567 2567 0.04
AT THE END OF THE YEAR 2567 0.04
Notes:
1. Paid up Share Capital of the Company (Face Value ` 10.00) at the end of the year is 64203618 Shares.
2. The details of holding has been clubbed based on PAN.
3. % of total Shares of the Company is based on the paid up Capital of the Company at the end of the Year.
iv. Shareholding pattern of top ten shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):
Sr. Name of Shareholder Shareholding at the No of Shares Shareholding at the end
No. beginning of the year of the year
No. of % of total Increase Decrease No. of % of total
Shares shares of the Shares shares of the
company company
1. Sequoia Capital India Investment 3,665,410 5.19 - 4,08,749 32,56,661 5.07
Holdings III
2. Jupiter India fund 10,30,164 1.60 - 1,40,809 8,89,355 1.38
3. Ramesh Damani 784,007 1.11 - 4,36,694 3,47,313 0.54
4. Jupiter South Asia Investment 2,38,535 0.37 - 70364 1,68,171 0.27
Company Limited - South Asia Access
Fund
5. Emerging Markets Core Equity Portfolio 1,69,473 0.26 - 14,148 1,55,325 0.24
(The Portfolio) of Dfa Investment
Dimensions Group Inc. (Dfaidg)
6 Globe Capital Market Limited 37674 0.06 2,04,848 1,08,330 1,34,192 0.21
7. Rajesh Bhimrao Ghonasgi 108,630 0.15 5,000 12,096 1,01,534 0.16
8. Mahesh Hemchand Purohit 95,000 0.15 11,853 15000 91,853 0.14
9. Nitin Tandon 96,600 0.15 10,771 85,829 0.13
10. Ariston Capital Services Pvt Ltd - - 85,138 - 85,138 0.13
Sr. Name of Shareholder Shareholding at the No. of Shares Shareholding at the end
No. beginning of the year of the year
No. of % of total Increase Decrease No. of % of total
Shares shares of the Shares shares of the
Company Company
6 Apurva Joshi - - - - - -
7 Amitabha Mukhopadhyay** - - - - - -
8 Shailesh Lakhani - - - - - -
9 Nitin Kulkarni – – – – - -
10 Srinivasa Rao Anasingaraju# – – – – - -
*Mr. Manu Parpia ceased to be Director of the Company effective May 11, 2019.
** Mr. Amitabha Mulhopadhyay appointed as a Director of the Company effective June 10, 2019.
# Mr. Srinivasa Rao Anasingaraju appointed as a Company Secretary of the Company effective May 10, 2019
VI. Indebtedness of the Company including interest outstanding / accrued but not due for payment:
NIL
VIII. Penalties / Punishment / Compounding of Offences: The Company received letters/e-mails from The National Stock Exchange
Limited and from Bombay Stock Exchange Limited regarding delay in submission of Annual Report pursuant to Regulation 34
(1) of SEBI LODR Regulations and consequent fine of ` 75,520/- each for the period of delay.
The Company has made its representation to both the stock exchanges with the reasons and facts. Subsequently, the
Company has received communication from The National Stock Exchange Limited on January 1, 2020 and from Bombay
Stock Exchange Limited on January 7, 2020 regarding withdrawal of the of the said fine amount.
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Corporate Overview Statutory Reports Financial Statements
The Report on the Corporate Governance pursuant to the SEBI LODR Regulations is given below.
2. Board of Directors:
As on March 31, 2020, the Company has seven Directors. Of the seven Directors, five are Non-Executive Directors out of
which four Directors are Independent Directors. The Board of Directors of the Company critically evaluates the Company’s
strategic direction, policies and their effectiveness. The actions of the Board are committed towards sustainably elevating
the Company’s value creation process. The Board of Directors strives to achieve higher standards and provide oversight and
guidance to management in strategy implementation, risk management and fulfillment of stated goals and objectives.
The Board has unrestricted access to all the Company related information. The senior executives, who can provide additional
insights and updates, are also invited at the meetings from time to time.
Except Mr. Kailash Sahebrao Katkar, Managing Director & CEO and Mr. Sanjay Sahebrao Katkar, Managing Director &
CTO, none of our Directors are related to each other.
The Company has received declarations as stipulated under Section 149(7) of the Companies Act, 2013 and as per the
applicable clause(s) of SEBI LODR Regulations from each Independent Director confirming that they are not disqualified
from being appointed /continuing as Independent Director and fulfil the conditions specified under SEBI LODR
Regulations and are thus independent of management. Your Company had also issued formal appointment letters to
all the Independent Directors in the manner provided under the Companies Act, 2013 and SEBI LODR Regulations. The
terms and conditions of the appointment of Independent Directors have been displayed on the website of the Company
and can be accessed through the following link: https://www.quickheal.co.in/investors/company-policies.
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Corporate Overview Statutory Reports Financial Statements
As on March 31, 2020, none of the Directors on the Board is a Director in more than 20 companies (including not more
than 10 Public Limited Companies) as specified in Section 165 of the Companies Act, 2013. None of the Independent
Directors serves as an Independent Director in more than 7 Listed Companies and Member of more than 10 Committees
and Chairman of more than 5 Committees (as specified in SEBI LODR Regulations) across all the public companies in
which he/she is a director.
None of the non- executive directors are holding any shares or convertible instruments in the Company.
(v) Conduct of Board Meetings:
The Board meets at least once in a calendar quarter, inter alia, to approve the quarterly financial results, the strategic
business plan and the annual budget. The annual calendar of Board Meetings is tentatively agreed upon at the beginning
of each year. Additionally, Board Meetings are convened to transact special business, as and when necessary.
Agenda papers, containing all relevant information, are made available to the Board well in advance to enable the Board
to discharge its responsibilities effectively and take informed decisions. Presentations are made to the Board by the
Business and Functional Heads on operations as well as various aspects concerning the Company. The Directors also
have independent access to the Senior Management at all times. The draft Minutes of the Meetings are circulated to the
Directors for their comments and the final minutes are thereafter entered into the Minutes Book within 30 days of the
conclusion of the Meetings.
There is also an effective post meeting follow-up, review and action taken reporting process for the action taken on
decisions of the Board and Committees. The Minutes of the meetings of all the Committees and also the subsidiaries are
placed before the Board for noting.
(vi) Familiarization Programme for Board Members including Independent Directors
The Board members are provided with the requisite documents reports and internal policies to enable them to familiarize
with Company’s business, procedures and practices.
Periodic presentations are also made at the Board and Committee meetings, on business and performance updates
of the Company, global business environment, business strategy and risks involved. The Key Managerial Personnel /
Senior Managerial Personnel through periodic presentations familiarize the Independent Directors with the strategy,
operations and functions of the Company and also appraise the Directors about their roles, rights and responsibilities in
the Company to enable them to make effective contribution and discharge their functions as a Board Member.
The familiarization programme for Independent Directors in terms of the provisions of SEBI LODR Regulations is
uploaded on the website of the Company and can be accessed through following link: https://www.quickheal.co.in/
investors/company-policies.
3. Board Committees
The Committees constituted by the Board play a very important role in the governance structure of the Company. The
composition and the terms of reference of these Committees are approved by the Board and are in line with the requirement
of the Companies Act, 2013 and as per applicable regulations of SEBI LODR Regulations. During the financial year ended
March 31, 2020, there were following 4 (Four) committees of Board viz. Audit Committee, Nomination and Remuneration
Committee, Stakeholders Relationship Committee and Corporate Social Responsibility Committee. The Board in order to
execute buyback process, on March 05, 2019 formed a Buyback committee comprising of Mr. Kailash Katkar, Managing
Director & CEO, Mr. Sanjay Katkar, Joint Managing Director & CTO, Mr. Mehul Savla, Independent Director, Ms. Apurva Joshi,
Independent Director, Mr. Nitin Kulkarni, Chief Financial officer, Mr. Deepak Kalera, Finance controller and Mr. Vinav Agarwal,
Assistant Company Secretary & Compliance Officer. During the year, the committee executed the buyback process as per
SEBI (Buyback of Securities) Regulation, 2018. The Committee was dissolved on July 15, 2019 since the purpose for which it
was formed was duly completed.
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Corporate Overview Statutory Reports Financial Statements
During the year under review, the Audit Committee met on May 10, 2019, August 08, 2019, November 14, 2019 and
February 05, 2020.
Names of Members of the Audit Committee and their attendance at the Meetings are given below:
Name Status Number of Meetings Attended
Mr. Amitabha Mukhopadhyay* Chairperson 03
Mr. Sanjay Katkar Member 03
Ms. Priti Rao Member 04
Ms. Apurva Joshi# Member 01
* Mr. Amitabha Mukhopadhyay appointed as member as well Chairperson of committee w.e.f July 15, 2019
# Ms. Apurva Joshi resigned as member of committee w.e.f July 15, 2019
The Chief Financial Officer regularly attends the Audit Committee Meetings and the Company Secretary acts as the
Secretary to the Audit Committee.
Terms of Reference:
The “Terms of Reference” of the Audit Committee are in conformity with the provisions of Section 177 of the Companies
Act, 2013 read with Companies (Meetings of Board and its Powers) Rules, 2014 and as per applicable Clauses of SEBI
LODR Regulations.
The WBP provides for establishment of Vigil Mechanism for directors and employees to report genuine concerns or
grievances. It encourages all employees, directors and business partners to report any suspected violations promptly
and intends to investigate any bonafide reports of violations. It also specifies the procedures and reporting authority for
reporting unethical behaviour, actual or suspected fraud or violation of the Company’s Code of Conduct or ethics policy
or any other unethical or improper activity including financial irregularities, including fraud, or suspected fraud, wastage
/ misappropriation of Company’s funds/assets etc.
The WBP also provides for adequate safeguards against victimization of employees and directors who avail of the vigil
mechanism and also provide for direct access to the Chairperson of the Audit Committee, in exceptional cases.
During the year under review, the Committee met on May 10, 2019 and on February 24, 2020.
Names of Members of the Committee and their attendance at the Meetings are given below:
Name Status Number of Meetings Attended
Mr. Mehul Savla Chairperson 1
Mr. Amitabha Mukhopadhyay* Member 1
Mr. Kailash Katkar Member 2
Ms. Apurva Joshi# Chairperson 1
* Mr. Amitabha Mukhopadhyay appointed as member of committee w.e.f July 15, 2019
# Ms. Apurva Joshi resigned from the Committee effective July 15, 2019
Terms of Reference:
The Terms of Reference of the Nomination and Remuneration Committee are in conformity with Section 178 of the
Companies Act, 2013.
Details of Remuneration paid to the Directors during the financial year ended March 31, 2020:
(a)
Executive Directors
Sr. Name of the Director Gross salary Commission/ Contribution Total. (in `) Notice period
No. (in `) Incentive (in `) to PF (in `)
1. *Mr. Kailash Katkar 1,19,48,221 13,44,100 Nil 1,32,92,321 6(six) Months
2. *Mr. Sanjay Katkar 1,17,83,342 13,44,100 Nil 1,31,27,442 6(six) Months
* As per the Employment Agreement dated: August 28, 2015, Mr. Kailash Katkar & Mr. Sanjay Katkar have been provided
1(one) car each by the Company.
Particulars of sitting fee paid to the Non-Executive Directors during the financial year ended March 31, 2020 are as
follows:
Sr. Name of the Director *Sitting fees paid(in `)
No.
1. Mr. Amitabha Mukhopadhyay 2,80,000/-
2. Mr. Manu Parpia --
3. Mr. Mehul Savla 2,20,000/-
4. Ms. Apurva Joshi 3,20,000/-
5. Ms. Priti Rao 2,80,000/-
* mentioned sitting fees is exclusive of goods and services tax.
There has been no material pecuniary relationship or transactions between the Company and Non-Executive Directors
during the financial year 2019-20.
During the year under review, no convertible instruments have been issued to any of the Non-Executive Directors of the
Company.
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Corporate Overview Statutory Reports Financial Statements
Pursuant to the SEBI LODR Regulations and Listing Agreement with the Stock Exchanges, Mr. Vinav Agarwal has been
appointed as the Compliance Officer who monitors the share transfer process, interacts with investors and liaises with
the Authorities such as SEBI, Stock Exchanges, and Registrar of Companies etc. The Company complies with the various
requirements of the SEBI LODR Regulations & Listing Agreement and depositories with respect to transfer of shares and
share certificates are sent to them within the prescribed time.
The Committee looks into the grievances of the Shareholders related to transfer of shares, payment of dividend and
non-receipt of annual report and recommends measure for expeditious and effective investor service etc.
The Terms of Reference of the Stakeholders Relationship Committee are in conformity with Section 178 of the Companies
Act, 2013 and Clause 20 of the SEBI LODR Regulations.
The Company has duly appointed Link Intime India Private Limited as Share Transfer Agent (R&T Agent) for servicing the
shareholders holding shares in physical or dematerialized form. All requests for dematerialization of shares are likewise
processed and confirmations thereof are communicated to the investors within the prescribed time.
Names of Members of the Committee and their attendance at the Meetings are given below:
Sr. Name Status No. of Meetings Attended
No.
1. Ms. Priti Rao Chairperson 1
2. Mr. Kailash Katkar Member 1
3. Mr. Sanjay Katkar Member 1
Terms of Reference:
The Terms of Reference of the Corporate Social Responsibility Committee (“CSR Committee”) are in conformity with
Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014.
Sr. Financial Year Date Day Time Number Details of Special Resolutions
No. of Special passed
resolution(s)
Passed
1. 2018-19 July 15, 2019 Monday 11.00 AM 2 (Two) 1. Variation of IPO Proceeds
2. Service of documents to
shareholders through particular
mode
2. 2017-18 August 08, 2018 Wednesday 11:00 AM Nil -
3. 2016-17 August 11, 2017 Friday 11:00 AM 2(Two) 1. Increase in ESOP pool size under
ESOP Scheme 2014
2. Authority to Board for allotment
of increased options under ESOP
Scheme 2014.
During financial year ended March 31, 2020, Company approached the shareholders through postal ballot for the approval of
Buyback of Equity shares of the Company. The details of the postal ballot are as follows:
Date of postal ballot notice: March 07, 2019 Date of Approval: April 12, 2019
Date of declaration of result: April 13, 2019 Voting Period: March 14, 2019 to April 12, 2019
Name of resolution Type of No. of Votes Votes Cast in favour Votes cast against
Resolution polled No. of Votes % No. of Votes %
Approval of Buyback of equity Special 53,085,207 53,084,540 99.99 667 0.00
shares of the Company Resolution
Scrutinizer
Mr. Jayavant B. Bhave of M/s J. B. Bhave & Co., Practising Company Secretaries, was appointed as the scrutinizer for carrying
out the above postal ballot in a fair & transparent manner.
Procedure for Postal Ballot
In compliance with sections 108 and 110 and other applicable provisions of the Companies Act 2013, read with the related
rules, the Company provided the electronic voting (e-voting) facility, in addition to the postal ballot, to all its members. For this
purpose, Company has engaged services of Link Intime India Private Limited.
Postal Ballot notice and form dispatched along with postage prepaid business reply envelopes to registered members/
beneficiaries. The same notice is sent by email to members who have opted to receive communication through the electronic
mode. The company also publishes a notice in the newspapers declaring the details and requirements as mandated by the
Act and applicable rules.
Voting rights are reckoned on the paid-up value of shares registered in the names of the members as on cut-off date.
Members who want to exercise their votes by physical postal ballots are requested to return the forms, duly completed and
signed, to the scrutinizer on or before the close of voting period. Those using the e-voting options are requested to vote
before the close of business hours on the last date of e-voting.
The scrutinizer completed his scrutiny and submitted his report to the Chairman, and the consolidated results of the voting are
announced by the Chairman. The results were also displayed on the Company’s website, www.quicheal.co.in, besides being
communicated to the stock exchanges, depository and registrar and share transfer agent.
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Corporate Overview Statutory Reports Financial Statements
5. Disclosures:
(i) Disclosures on materially significant related party transactions that may have potential conflict with the interests
of Company at large.
The Company has not entered into any transaction of material nature with the Promoters, the Directors or the Management
or their relatives and its subsidiaries or that may have any potential conflict with the interests of the Company. Related
Party transactions are disclosed in the notes to the Financial Statements.
(ii) Details of non-compliance by the Company, penalties, and strictures imposed on the Company by Stock Exchange
or SEBI or any statutory authority, on any matter related to capital markets, during the last three years.
No penalties or strictures have been imposed on the Company by the stock exchanges or SEBI or any other statutory
authorities relating to the above.
However the Company received letters/e-mails from The National Stock Exchange Limited (dated 15th October 2019)
and from Bombay Stock Exchange Limited (dated15th October 2019) regarding delay in submission of Annual Report and
consequent fine of RS. 75,520 each for the period of delay.
The Company applied for waiver of the fine on 24th October 2019. Subsequently, the Company has received
communication from The National Stock Exchange Limited (dated 1st January 2020) and from Bombay Stock Exchange
Limited (dated 7th January 2020) regarding withdrawal of the letter imposing the said fine amount.
(iii) Details of compliance with mandatory requirements and adoption of the non-mandatory requirements of this
clause
The Company has complied with all the mandatory requirements of SEBI LODR Regulations.
(iv) Compliance with non-mandatory requirements (as on March 31, 2020)
The Company has adopted following non-mandatory requirements of SEBI LODR Regulations.
(1) Shareholders’ Rights
The quarterly results are regularly posted on the website of the Company.
(2)
Audit Qualifications
For the financial year under review, there were no audit qualifications in the Company’s financial statements. The
Company continues to adopt best accounting practices.
6. Means of Communication:
i) Quarterly Results The quarterly, half yearly and yearly financial results of the Company are regularly
mailed /sent to the stock exchanges immediately after they are approved by the Board.
They are also published in the Newspapers, in the prescribed format under the SEBI
LODR Regulations.
ii) Newspapers wherein results Financial Express and Dainik Janashakati/ Prabhat
normally published
iii) Any website, where displayed www.quickheal.co.in
iv) Whether it also displays The Company displays the Press Releases as and when released.
official news releases
v) The Presentations made to The Company holds Investor Presentations and meetings from time to time and
institutional investors or to the Presentations made thereat are also sent to the Stock Exchanges as well as displayed
analysts on the website of the Company.
vi) NSE Electronic Application The NEAPS is a web based application designed by NSE for corporate. All periodical
Processing System (NEAPS) compliance filings like shareholding pattern, corporate governance report, media
releases, among others are filed electronically on NEAPS.
vii) BSE Corporate Compliance BSE’s Listing Centre is a web based application designed for corporate. All periodical
& Listing Centre (the ‘Listing compliance filings like shareholding pattern, corporate governance report, media
Centre’) releases, among others are filed electronically on the Listing Centre.
viii) SEBI Complaint Redressal The investor complaints are processed in a centralized web based complaint redressal
System (SCORES) system. The salient features of this system are:
Centralized Data Base of all complaints, online upload of Action Taken Report (ATRs)
by the concerned companies and online viewing by investors of action taken on the
complaint and its current status.
7.8 Stock Market Price Data National Stock Exchange of India Ltd.(NSE) BSE Limited (BSE)
Month’s High Price Month’s Low Price Month’s High Price Month’s Low Price
(in `) (in `) (in `) (in `)
April, 2019 239.95 208.00 240.50 208.05
May, 2019 227.80 165.60 227.70 171.10
June, 2019 193.65 150.10 194.00 150.40
July, 2019 170.35 119.30 176.00 119.25
August, 2019 135.70 100.05 138.70 100.50
September, 2019 146.60 105.55 146.90 105.80
October, 2019 135.85 113.00 135.80 112.00
November, 2019 146.80 125.60 146.60 125.20
December, 2019 141.30 123.00 141.60 123.10
January, 2020 147.35 124.95 147.30 125.15
February, 2020 133.00 111.45 135.05 112.55
March, 2020 119.00 63.10 118.80 62.45
7.9 Registrar & Transfer Agents: Link Intime India Private Limited, - C 101, 247 Park, L.B.S. Marg, Vikhroli (West),
Mumbai – 400083, Phone: 022- 4918 6200
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Corporate Overview Statutory Reports Financial Statements
7.10 Share Transfer System : Share transfer requests for shares in physical form, if any, are registered within 10 – 15
days. In case of shares in electronic form, the transfers are processed by NSDL / CDSL
through the respective Depository Participants.
7.12 Dematerialisation of shares : 6,42,03,617 Nos of Shares has been dematerialised as on March 31, 2020 & 01 no. of
Share was in Physical Form. Trading in equity shares of the Company is permitted only
in dematerialized form.
7.13 Outstanding GDRs/ADRs/ Nil
Warrants or any convertible
instruments, conversion
dates and likely impact on
equity.:
7.14 Plant locations : Nil
7.15 Investor Correspondence: Link Intime India Private Limited
For transfer / dematerialisation C 101, 247 Park, L.B.S. Marg, Vikhroli (West), Mumbai – 400083, Maharashtra, India 022-
of shares, payment of dividend Tel: +91 (22) 4918 6200; Fax: +91 (22) 4918 6195;
on shares, query on Annual email id: : rnt.helpdesk@linkintime.co.in; website: www.linkintime.co.in
Report and any other query
on the shares of the Company.
Shareholders holding shares in electronic mode should address all their correspondence relating to change of
address, bank mandate and status to their respective Depository Participants (DPs).
Important Communication to Members:
Members must be aware that Ministry of Corporate Affairs (MCA) has started a “Green Initiative in the Corporate
Governance”, whereby it has allowed paperless compliances by the Companies in the field of servicing of notice /
documents, including Annual Report through emails. Further, in compliance with Ministry of Corporate Affairs (“MCA”)
has vide its circular dated May 5, 2020 read with circulars dated April 8, 2020 and April 13, 2020 and SEBI Circular
dated May 12, 2020, Notice of the AGM along with the Annual Report 2019-20 is being sent only through electronic
mode to those Members whose email addresses are registered with the Company/ Depositories. Therefore, Members
who have not yet registered their email addresses are requested once again to register their email addresses in
respect of their shareholding in electronic mode with the Depository Participants, including any change in their email
id. Members holding shares in physical mode are requested to register their email addresses with the Company / Link
Intime India Private Limited, the Registrar & Transfer Agent.
8. OTHER INFORMATION
(a) Risk Management Framework:
The Company has an appropriate place mechanism to inform the Board members about the risk assessment and
minimization procedures and periodical reviews to ensure that risk is controlled by the executive management through
the means of a properly defined framework. The Risk Register is presented before the Members of Audit Committee,
every quarter.
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Corporate Overview Statutory Reports Financial Statements
c. Disclosures in relation to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal)
Act, 2013:
The details of the complaints filed, disposed of and pending during the financial year pertaining to sexual harassment is
provided in the Directors’ Report of this Annual report
General Disclosures
a. A summary of transactions with related parties in the ordinary course of business are periodically placed before the
audit committee;
b. The mandatory disclosure of transactions with related parties in compliance with the applicable Accounting
Standards are a part of this Annual Report;
c. The Policy on Related Party Transactions and for determining Material Subsidiaries is disclosed and available in
web link of the company i.e. https://www.quickheal.co.in/investors/company-policies.
d. While preparing the annual accounts in respect of the financial year ended March 31, 2020, no accounting treatment
was different from that prescribed in the Accounting Standards;
e. The Company does not have a material non-listed Indian subsidiary as defined under Regulation 16 of the SEBI
LODR Regulations. However, the Company has unlisted subsidiary companies abroad. The minutes of the Board
meetings of the subsidiary companies are placed at the Board meetings of the Company. Details of significant
transactions and arrangements entered into by the subsidiary companies are noted by the Board. The Audit
Committee of the Company reviews the financial statements of the subsidiary companies, including investments
made by such subsidiaries. The Company has adopted a policy for determining material subsidiaries which is
displayed on the Company’s website https://www.quickheal.co.in/investors/company-policies.
f. The Company has a Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information
and a Code of Conduct to Regulate, Monitor and Report Trading by its employees and other connected persons, in
accordance with the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015.
Mr. Vinav Agarwal, Assistant Company Secretary has been appointed as the Compliance Officer for the purpose of
this Code.
g. The Company has obtained a certificate from M/s J B Bhave & Co., Company Secretaries, Pune that none of the
directors on the board of the company have been debarred or disqualified from being appointed or continuing as
directors of companies by the Board/Ministry of Corporate Affairs or any such statutory authority.
2. Your Company publishes financial results in two newspapers of wide circulation. Further, the financial results
are available on the website of your Company and of the stock exchanges where the shares of your Company
are listed, i.e., BSE Ltd and National Stock Exchange of India Limited. Therefore, no individual intimations are
sent to the shareholders.
During the year ended March 31, 2016, the Company had raised ` 4,512.53 Million through public issue, specifically
to meet the following objects of the Offer. The ‘’Objects of the Issue” in the Prospectus dated February 13,
2016, which included a) Advertising and sales promotion; b) Capital expenditure for research and development;
c) Purchase, development and renovation of office premises in Kolkata, Pune and New Delhi; and d) General
corporate purposes.
There is an unspent amount of ` 468.50 Million as on March 31, 2020 under the object “Advertising and sales
promotion”. In view of the above, it is proposed to transfer ` 250.00 Million (the Part of unutilized funds) out of the
total up-spent of ` 468.50 Million to category “General Corporate Purpose”, where these funds will be utilized along
with the existing unutilized funds in this category.
In terms of Section 27 of the Companies Act, 2013 a Company cannot vary the terms of a contract referred to in the
prospectus except subject to the approval of or except on authority given by, the Company in a general meeting.
Therefore, the Board of Directors seeks approval of the member for use/deployment of part of unutilized amount
of the IPO proceeds under the object “Advertising and sales promotion, an amount of ` 250.00 Million out of the
current unspent amount of ` 468.50 Million as on March 31, 2020 for ‘’General Corporate Purposes’’ in addition
to the Objects of the issue stated in the Prospectus of the IPO of the Company. The Board of Directors also seeks
approval of members for varying the allocation of the unutilized part of the IPO proceeds for the above stated
objects. However, there is no deviation from the stated objects in the Prospectus of the Company pursuant to
Regulation 32 of SEBI LODR Regulations.
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Corporate Overview Statutory Reports Financial Statements
This is to confirm that the Company has adopted a Code of Conduct for its employees including the Managing Director and
Executive Directors. In addition, the Company has adopted a Code of Conduct for its Non-Executive Directors and Independent
Directors. These Codes are available on the Company’s website. I confirm that the Company has in respect of the year ended
March 31, 2020, received from the Senior Management Team of the Company and the Members of the Board a declaration of
compliance with the Code of Conduct as applicable to them. For the purpose of this declaration, Senior Management Team means
the Chief Financial Officer, Company Secretary and the Chief Human Resource Officer as on March 31, 2020.
Kailash Katkar
Managing Director & CEO
To
The Members
Quick Heal Technologies Limited
I have examined the compliance of conditions of corporate governance by Quick Heal Technologies Limited, (“the Company”) for
the year ended on March 31, 2020, as stipulated in Securities and Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015 pursuant to the Listing Agreement of the Company with stock exchanges.
The compliance of conditions of corporate governance is the responsibility of the management. My examination was limited to
procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate
Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.
In my opinion and to the best of my information and according to the explanations given to me and considering the relaxations
granted the Ministry of Corporate Affairs and Securities and Exchange Board of India warranted due to the spread of the COVID-19
pandemic, I certify that the Company has complied with the conditions of Corporate Governance as stipulated in the provisions as
specified in Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 pursuant
to Listing Agreement signed by the Company with stock exchanges.
I further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness
with which the management has conducted the affairs of the Company.
Jayavant B. Bhave
Proprietor
FCS: 4266 CP: 3068
UDIN: F004266B000260357
PR No.: 486/ 2016
Place: Pune
Date: 20th May, 2020
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Corporate Overview Statutory Reports Financial Statements
TO,
The Members of
QUICK HEAL TECHNOLOGIES LIMITED
Office No. 7010 C & D, Marvel Edge, 7th Floor,
Viman Nagar, Pune, Maharashtra, 411014
I have examined the relevant registers, records, forms, returns and disclosures received from the Directors of QUICK HEAL
TECHNOLOGIES LIMITED having CIN: L72200MH1995PLC091408 and having registered office at Marvel Edge 7010 C & D Opposite
NECO garden Society, Viman Nagar Pune- 411014, Maharashtra (hereinafter referred to as ‘the Company’), produced before me
by the Company for the purpose of issuing this Certificate, in accordance with Regulation 34(3) read with Schedule V Para-C Sub
clause 10(i) of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations,2015.
In my opinion and to the best of my information and according to the verifications (including Directors Identification Number (DIN)
status at the portal www.mca.gov.in) as considered necessary and explanations furnished to me by the Company & its officers and
considering the relaxations granted the Ministry of Corporate Affairs and Securities and Exchange Board of India warranted due to
the spread of the COVID-19 pandemic, I hereby certify that none of the Directors on the Board of the Company as stated below for
the Financial Year ending on March 31, 2020 have been debarred or disqualified from being appointed or continuing as Directors
of companies by the Securities and Exchange Board of India, Ministry of Corporate Affairs, or any such other Statutory Authority.
Ensuring the eligibility of for the appointment / continuity of every Director on the Board is the responsibility of the management
of the Company. Our responsibility is to express an opinion on these based on our verification. This certificate is specifically being
issued in accordance with Regulation 34(3) read with Schedule V Para-C Sub clause 10(i) of the Securities Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015 and is neither an assurance as to the future viability of the
Company nor of the efficiency or effectiveness with which the management has conducted the affairs of the Company.
Jayavant B. Bhave
Proprietor
FCS: 4266 CP: 3068
UDIN: F004266B000260357
PR No.: 486/ 2016
Place: Pune
Date: 20th May, 2020
A. We have reviewed financial statements and the cash flow statement for the period April 1, 2019 to March 31, 2020 and that to
the best of our knowledge and belief:
1) these statements do not contain any materially untrue statement or omit any material fact or contain statements that
might be misleading;
2) these statements together present a true and fair view of the Company’s affairs and are in compliance with existing
accounting standards, applicable laws and regulations.
B. There are, to the best of our knowledge and belief, no transactions entered into by the Company during the period April 1,
2019 to March 31, 2020 which is fraudulent, illegal or violative of the Company’s code of conduct.
C. We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluated the
effectiveness of internal control systems of the Company pertaining to financial reporting and we disclosed to the auditors
and the audit committee, deficiencies in the design or operation of such internal controls, if any, of which we are aware and
the steps we have taken or propose to take to rectify these deficiencies.
1) significant changes in internal control over financial reporting during the period April 1, 2019 to March 31, 2020;
2) significant changes in accounting policies during the period April 1, 2019 to March 31, 2020 and that the same have been
disclosed in the notes to the financial statements; and
3) instances of significant fraud of which they have become aware and the involvement therein, if any, of the management
or an employee having a significant role in the Company’s internal control system over financial reporting.
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Corporate Overview Statutory Reports Financial Statements
Overview: The Charter complements and does not replace other existing
Quick Heal Technologies Ltd is one of the leading IT security compliance programs, such as control processes, financial and
solutions company. Each Quick Heal product is designed to operational audits, ISO, quality systems, internal and external
simplify IT security management across the length and depth reviews, etc. This charter is built on globally established
of devices and on multiple platforms. They are customized to principles of sound risk management.
suit consumers, small businesses, government establishments
Objective of Risk Management:
and corporate houses.
The Objective of Enterprise Risk Management is superior
A number of practices and forms are adopted by the achievement of business goals through:
Management while taking decisions and monitoring
- improved and consistent decision making taken by all in
performance, including functional and business review, which
the organisation and
addresses current performance and future direction and
changes thereto, as well as addressing potential risks. As a - a culture of thinking about the downside and upside of
part of strengthening and institutionalizing the decision making decision making based on judgment and data
process and monitoring the exposures that are faced by Quick
In the process regulatory requirements for a Risk Management
Heal, a formalized Enterprise Risk Management System (ERM)
System and Policy are also sought to be complied.
is being implemented on an Enterprise-Wide-Scale.
To realize the risk management objective, the Company aims
Identifying and Managing Risk is a skill that is sought to be
to ensure that:
strengthened through this process and an effort at making
decision making more consistent in a way that the business • The identification and management of risk is integrated in
objectives are met most of the times. The ERM process seeks day to day management of the business
to provide greater confidence to the decision maker and thus
• Risks are identified, assessed in the context of the
enhance achievement of objectives.
measurable scales of Consequence and Likelihood,
As a part of the Corporate Governance requirements under the continuously monitored and managed to an acceptable
Companies Act, 2013 and also under the Listing Agreement of level,
the Stock Exchanges, there is a requirement for Public Listed
• The escalation of risk information is timely, accurate and
Companies to have Risk Management Policy in place.
complete, to support decision making at all management
Quick Heal is committed to ensuring: levels.
• Minimal surprises in performance due to internal and Comprehensive risk identification using a well-structured
external business environment changes systematic process is critical, because a potential risk not
identified will be excluded from further analysis. Identification
• Adherence to applicable regulatory requirements and should include all risks whether or not they are under the
• Help business leaders and management decide on the control of the Company.
rationale for either of; Each Risk Owner must monitor the risks faced by the function
• Taking the risk on a regular basis and more specifically on a quarterly basis
assess the risks that they face as a group based on the
• Safeguards / insurance to taking that risk (i.e. sharing
defined objectives, internal and external context realities and
it with others or avoiding it altogether)
the Stakeholder objectives. It will not be limited to a review of
• Costs of such safeguards vis-à-vis upside / risks already identified but will include a review of the changes
downside of accepting risks in the environment. This review should include identification
for all significant areas. Workshops or brainstorming sessions
• Periodic review of the afore-stated positions
may be conducted amongst the group to identify new risks
The Risk Management Policy establishes a formal framework that may have emerged over a period of time. This review will
of Enterprise Risk Management in Quick Heal and is the basis include a documented analysis of the reasons for all successes
for all ERM related activities in the organization. and failures vis-à-vis the Objectives in the daily working or
projects undertaken and identifying the learning for the future. management plans and implementing them. Treatment
options may include:
RISK ASSESSMENT:
The risk will be assessed on qualitative two fold criteria. The • Accepting the risk level within the established criteria
two components of risk assessment are (a) the likelihood of • Transferring the risk to other parties e.g. insurance
occurrence of the risk event, and (b) the magnitude of impact
• Avoiding the risk by hedging/adopting safer practices or
if the risk event occurs. The combination of likelihood of
policies and
occurrence and magnitude of impact provides the risk level.
• Reducing the likelihood of occurrence and/or
The magnitude of the impact of an event, should it occur and
consequences of risk event.
the likelihood of the event and its associated consequences,
are assessed in 2 stages – Action plans need to be time bound and responsibility driven
to facilitate future status monitoring. Mitigating practices
1. Inherent Risk – Assessment before considering any
and controls shall include determining policies, procedure,
action taken to mitigate the consequence or likelihood of
practices and processes in place and additional resource
risk.
allocation what will ensure that existing level of risks is brought
2. Residual or Controlled Risk – Assessment in the context down to an acceptable level. In many cases significant risk
of the existing controls that mitigate the consequence or may still exist after mitigation of risk level through the risk
likelihood of Risk. treatment process. These residual risks need to be monitored.
The impact and likelihood may be determined using statistical ESCALATION OF RISKS:
analysis and calculations. Alternatively, where no past data are
It is critical to institute an effective system of escalation which
available, subjective estimates may be made which reflect an
ensures that specific issues are promptly communicated and
employees, or group`s degree of belief that a particular event
followed up appropriately. Every employee of the Company
or outcome will occur.
has responsibility of identifying and escalating the risks to
RISK EVALUATION: appropriate levels within the Company. This involves an
Impact and Likelihood are combined to produce a level of risk. assessment of controls to mitigate the risks. In case controls
For each risk, the score for likelihood and impact should be are not performing as designed or the proportion of deviation
multiplied to arrive at combined score. The risk is classified is high there is a need to reassess the Risk and also put in place
into four categories based on combined score (value) that are: a corrective program. The CRO and the Committee heads will
determine whether the risk needs immediate escalation to
1. Extreme next level or it can wait till subsequent periodic review.
2. High All the risks are classified into the following categories while
3. Cautionary & reporting:
4. Acceptable 1. Strategic
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Corporate Overview Statutory Reports Financial Statements
SECTION D: BR INFORMATION
1. Details of Director/Directors responsible for BR
(a) Details of the Director/Director responsible (a)
for implementation of the BR policy/policies 1. DIN Number: 00397191
2. Name : Kailash Katkar
3. Designation : Managing Director & CEO
(b) Details of the BR head (b)
No. Particulars Details
1 DIN Number 00397191
2 Name Kailash Katkar
3 Designation Managing Director & CEO
4 Telephone number 020-66813232
5 e-mail id cs@quickheal.co.in
P1. Business should conduct and govern themselves with Ethics, Transparency and Accountability
P2. Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle
P3. Businesses should promote the wellbeing of all employees
P4. Businesses should respect the interests of, and be responsive towards all stakeholders, especially those who are
disadvantaged, vulnerable and marginalized
P5. Businesses should respect and promote human rights
P6. Business should respect, protect, and make efforts to restore the environment
P7. Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner
P8. Businesses should support inclusive growth and equitable development
P9. Businesses should engage with and provide value to their customers and consumers in a responsible manner
(a) Details of compliance (Reply in Y/N)
No. Questions P1 P2 P3 P4 P5 P6 P7 P8 P9
1 Do you have a policy/ policies for.... Y N Y Y Y N N Y Y
2 Has the policy being formulated in consultation Y N Y Y Y N N Y Y
with the relevant stakeholders?
3 Does the policy conform to any national / Y N Y Y Y N N Y Y
international standards? If yes, specify? (50 words)
The Company has prepared these policies
after reviewing the international and industry
best practices and has discussed internally in
detail before its implementation. The policies
are of international standards and are open for
amendments, as and when required.
4 Has the policy being approved by the Board? Y N Y Y Y N N Y Y
Is yes, has it been signed by MD/ owner/ CEO/ These policies have been signed by the Managing Director
appropriate Board Director?
5 Does the company have a specified committee Y N Y Y Y N N Y Y
of the Board/ Director/ Official to oversee the
implementation of the policy?
Indicate the link for the policy to be viewed online? www.quicheal.co.in
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Corporate Overview Statutory Reports Financial Statements
No. Questions P1 P2 P3 P4 P5 P6 P7 P8 P9
6 Has the policy been formally communicated to all Y N Y Y Y N N Y Y
relevant internal and external stakeholders?
7 Does the company have in-house structure to Y N Y Y Y N N Y Y
implement the policy/ policies.
8 Does the Company have a grievance redressal Y N Y Y Y N N Y Y
mechanism related to the policy/ policies to
address stakeholders’ grievances related to the
policy/ policies?
9 Has the company carried out independent audit/ Y N Y Y Y N N Y N
evaluation of the working of this policy by an
internal or external agency?
(b) If answer to the question at serial number 1 against any principle, is ‘No’, please explain why: (Tick up to 2 options)
No. Questions P1 P2 P3 P4 P5 P6 P7 P8 P9
1 The company has not understood the Principles - - - - - - - - -
2 The company is not at a stage where it finds - - - - - - - - -
itself in a position to formulate and implement the
policies on specified principles
3 The company does not have financial or - - - - - - - - -
manpower resources available for the task
4 It is planned to be done within next 6 months - - - - - - - - -
5 It is planned to be done within the next 1 year - - - - - - - - -
6 Any other reason (please specify) Need for a written policy was not felt. Suitable decision for a
written policy will be taken at appropriate time
3. Governance related to BR
(a) Indicate the frequency with which the Board of Directors, Committee of the Board or CEO to assess the BR performance
of the Company. Within 3 months, 3-6 months, Annually, More than 1 year
This is the first time the Company is publishing Business Responsibility Report. In future, the Company will assess the BR
performance every year.
(b) Does the Company publish a BR or a Sustainability Report? What is the hyperlink for viewing this report? How frequently
it is published?
No
Principle 2
1. List up to 3 of your products or services The Company is in the business of providing IT security solutions. Hence,
whose design has incorporated social these products do not attract social or environmental concerns, risks and/
or environmental concerns, risks and/or or opportunities
opportunities.
2. For each such product, provide the Not Applicable
following details in respect of resource use
(energy, water, raw material etc.) per unit of
product(optional):
(a) Reduction during sourcing/production/
distribution achieved since the previous
year throughout the value chain?
(b) Reduction during usage by consumers
(energy, water) has been achieved since
the previous year?
3. Does the company have procedures in The Company has Procurement Policy in place which considers sustainability,
place for sustainable sourcing (including financial viability of the suppliers, quality of good and services, while procuring
transportation)? any material/sourcing any parts/engaging in any service engagements
(a) If yes, what percentage of your inputs
was sourced sustainably? Also, provide
details thereof, in about 50 words or so.
4. Has the company taken any steps to procure We encourage sourcing from the local vendors. Local sourcing reduces
goods and services from local & small costs, provides local employment benefits and reduced environmental
producers, including communities surrounding footprint in sourcing. However, considering the nature of business and the
their place of work? need for updated technology, we have to go for service engagements with
(a) If yes, what steps have been taken to overseas vendors /service engagements.
improve their capacity and capability of
local and small vendors?
5. Does the company have a mechanism to Company had installed water aerators to optimize the water consumption at
recycle products and waste? If yes what is all taps. This helped the Company to save water at large extent.
the percentage of recycling of products and
waste (separately as <5%, 5-10%, >10%). Also,
provide details thereof, in about 50 words or
so.
Principle 3
1. Please indicate the Total number of employees. 942
2. Please indicate the Total number of employees hired on temporary/contractual/ 93
casual basis.
3. Please indicate the Number of permanent women employees. 152
4. Please indicate the Number of permanent employees with disabilities NA
5. Do you have an employee association that is recognized by management. No
6. What percentage of your permanent employees is members of this recognized NA
employee association?
7*. Please indicate the Number of complaints relating to child labour, forced labour, Nil
involuntary labour, sexual harassment in the last financial year and pending, as on
the end of the financial year.
8. What percentage of your under mentioned employees were given safety & skill a) Permanent Employees - 100%
up-gradation training in the last year? (b) Permanent Women Employees -
(a) Permanent Employees 100%
(b) Permanent Women Employees (c) Casual/Temporary/Contractual
(c) Casual/Temporary/Contractual Employees Employees - 100%
(d) Employees with Disabilities (d) Employees with Disabilities – NA
104
Corporate Overview Statutory Reports Financial Statements
Principle 4
1. Has the company mapped its internal and external Yes
stakeholders? Yes/No
2. Out of the above, has the company identified Yes
the disadvantaged, vulnerable & marginalized
stakeholders.
3. Are there any special initiatives taken by the company Yes Company has taken various special initiatives to engage with
to engage with the disadvantaged, vulnerable and disadvantaged, vulnerable and marginalized stakeholders which are
marginalized stakeholders. If so, provide details as follows:
thereof, in about 50 words or so. a. Community Development-
Work on health, education, livelihood and facilitation of midday
meals for the katkaris.
b. Promotion of Education
Our initiatives help empower young students with crucial life
skills, and address pressing and often ignored challenges and
queries they face, in the academic and personal sphere.
We provide counselling and awareness regarding behavioural
and family problems, addiction, challenges in studies, sex
education, HIV and AIDS awareness, child and sexual abuse
and more
Principle 5
1. Does the policy of the company on human rights The policy extends to the Quick Heal Group
cover only the company or extend to the Group/ Joint
Ventures /Suppliers /Contractors /NGOs /Others?
2. How many stakeholder complaints have been During the year, the Company did not receive any complaint from its
received in the past financial year and what percent stakeholders.
was satisfactorily resolved by the management?
Principle 6
1. Does the policy related to Principle 6 cover only the The policy extends to Quick Heal
company or extends to the Group/Joint Ventures/
Suppliers/Contractors/NGOs/others.
2. Does the company have strategies/ initiatives to Yes, the Company has installed 45KW Solar plant at Thube Park,
address global environmental issues such as climate Shivajinagar Office, Pune. Plant is running & generating more than
change, global warming, etc? Y/N. If yes, please give 5% of it’s total energy requirement for location.
hyperlink for webpage etc.
3. Does the company identify and assess potential Yes
environmental risks? Y/N
4. Does the company have any project related to Clean Company do not generate any hazardous waste.
Development Mechanism? If so, provide details
thereof, in about 50 words or so. Also, if Yes, whether
any environmental compliance report is filed?
5. Has the company undertaken any other initiatives Yes, the Company has installed 45KW Solar plant at Thube Park,
on – clean technology, energy efficiency, renewable Shivajinagar Office, Pune. Plant is running & generating more than
energy, etc. Y/N. If yes, please give hyperlink for web 5% of it’s total energy requirement for location.
page etc.
6. Are the Emissions/Waste generated by the company E-waste generated by the company is in the permissible limit.
within the permissible limits given by CPCB/SPCB for
the financial year being reported?
7. Number of show cause/ legal notices received from Company did not received any show cause/ legal notice during the
CPCB/SPCB which are pending (i.e. not resolved to financial year ended March 31, 2020.
satisfaction) as on end of Financial Year.
Principle 7
1. Is your company a member of any trade and chamber The company is a member of:
or association? If Yes, Name only those major ones a. Association of Antivirus
that your business deals with:
b. Confederation of Indian Industries
c. Data Security Council of India
d. Proventus Angel Network LLP
2. Have you advocated/lobbied through above No
associations for the advancement or improvement of
public good? Yes/No; if yes specify the broad areas
(drop box: Governance and Administration, Economic
Reforms, Inclusive Development Policies, Energy
security, Water, Food Security, Sustainable Business
Principles, Others)
Principle 8
1. Does the company have specified programmes / Company has a Cyber Security Awareness program. Company’s
initiatives/projects in pursuit of the policy related to awareness initiatives aim to do just that, for future bastions of the
Principle 8? If yes details thereof. fight against cyber threats. We directly involve students, teachers
and the public in these initiatives.
Initiatives: Earn and Learn, Cy-Fi Arts Festival, Faculty Development
Program, Student Resource Web Portal and Street Plays
2. Are the programmes/projects undertaken through Projects undertaken are:
in-house team/own foundation/external NGO/ a. Cyber Security Awareness - In house team and college volunteers
government structures/any other organization?
b. Promotion of Education - Pankh NGO
c. Community Development - Kasba Ganpati Samajik Sanstha
d. Cy-Fi Arts Festival - College
e. Streetplays - External team
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Corporate Overview Statutory Reports Financial Statements
Promotion of Education
Quick Heal initiatives in education help secure the futures of
students at especially crucial times during their developing years. In
association with the Pankh Foundation, these are designed to tackle
those problems faced by students which are not being effectively
addressed by existing avenues. They protect students from current
and potential threats to their well-being and create safe environments
for active dialogue.
We provide counselling and awareness regarding behavioural and
family problems, addiction, challenges in studies, sex education, HIV
and AIDS awareness, child and sexual abuse and more.
Impact Figures
14,314 students impacted
26 schools/colleges
Cyber Security Awareness
Earn and Learn
Quick Heal provides training to Computer Science students
regarding cyber-security and safe and responsible practices online.
These volunteers then go on to conduct lessons for others. They
even receive a stipend for these efforts. This activity is carried out
across Maharashtra.
Impact Figures
Students sensitized 5,13,185
Schools covered 1,165
Cy-Fi Arts Festival
This is a unique initiative towards increasing cyber-security
awareness. It is a competitive festival of short films. The initiative
is crafted as a one-of-its kind means of engaging and informing a
growing audience regarding digital behavior and cyber-security. The
project is supported by Maharashtra Cyber.
Faculty Development Program
As part of this initiative, Quick Heal has partnered with select
Computer Science colleges in Maharashtra. The teachers there are
trained in advanced level C and C++, as per industry standards. This
training is based on special modules designed by the Quick Heal
R&D department. They are designed with the objective of supporting
the creation of secure and robust programming applications by the
students.
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Corporate Overview Statutory Reports Financial Statements
To the Members of Quick Heal Technologies Limited affairs of the Group as at March 31, 2020, of consolidated
profit, consolidated changes in equity and its consolidated
Report on the Audit of the Consolidated Financial cash flows for the year then ended.
Statements
Opinion Basis for Opinion
We have audited the accompanying consolidated financial We conducted our audit in accordance with the Standards
statements of Quick Heal Technologies Limited (hereinafter on Auditing (SAs) specified under section 143(10) of the
referred to as the “Holding Company”) and its subsidiaries Act. Our responsibilities under those Standards are further
(Holding Company and its subsidiaries together referred to described in the Auditor’s Responsibilities for the Audit of the
as “the Group”), which comprise the Consolidated Balance Consolidated Financial Statements section of our report. We
Sheet as at March 31, 2020, and the Consolidated Statement are independent of the Group in accordance with the ethical
of Profit and Loss, the Consolidated Statement of Changes requirements that are relevant to our audit of the consolidated
in Equity and the Consolidated Statement of Cash Flows for financial statements in India in terms of the Code of Ethics
the year then ended, and notes to the Consolidated Financial issued by Institute of Chartered Accountant of India (“ICAI”),
Statements, including a summary of significant accounting and the relevant provisions of the Act and we have fulfilled
policies and other explanatory information (hereinafter our other ethical responsibilities in accordance with these
referred to as “the consolidated financial statements”). requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for
In our opinion and to the best of our information and according our opinion.
to the explanations given to us, and based on consideration of
reports of other auditors on separate financial statements and Key Audit Matters
on the other financial information of subsidiaries, the aforesaid Key audit matters are those matters that, in our professional
consolidated financial statements give the information judgment, were of most significance in our audit of the
required by the Companies Act, 2013 (“the Act”) in the manner consolidated financial statements of the current period. These
so required and give a true and fair view in conformity with the matters were addressed in the context of our audit of the
Indian Accounting Standards prescribed under section 133 of consolidated financial statements as a whole, and in forming
the Act read with Companies (Indian Accounting Standards) our opinion thereon, and we do not provide a separate opinion
Rules, 2015 as amended and other accounting principles on these matters.
generally accepted in India, of their consolidated state of
Sr. Key Audit Matter How the Key Audit Matter was addressed in our audit
No.
1 Revenue Recognition Our audit procedures in respect of this area include but are
Refer the disclosures related to Revenue recognition in Note not limited to:
23 to the accompanying Financial Statements. 1. Obtained and read contract with customers and confirmed
our understanding of the Holding Company’s sales
Revenue is recognized in accordance with Ind AS 115,
process, including design and implementation of controls
Revenue from the sale of security software products
and tested the operating effectiveness of these controls.
and devices is recognised when control of the goods is
transferred to the customer at an amount that reflects the 2. Read and understood the Holding Company’s accounting
policy for revenue recognition.
consideration to which the Holding Company expects to be
entitled in exchange for those goods. 3. Confirmed our understanding of the nature of security
software products sold by the Holding Company.
We determined this matter to be a key audit issue as the
application of Ind AS 115 involves certain key judgements 4. Read the customer agreements to test the terms
and conditions for sale of such products including
relating to identification of separate performance obligations,
identification of performance obligations and allocation
determination of basis and its appropriateness for allocation
of the transaction price to such performance obligation
of transaction price to the identified performance obligations;
based on appropriate method, as applicable.
and recognition of such identified performance obligations
5. Discussed with management the key assumptions
based on timing of satisfaction (i.e. over time or point in time)
underlying the Holding Company’s assessment of cost
related to identified performance obligations and tested
mathematical accuracy of the underlying data used
for computation and calculations made by the Holding
Company
Sr. Key Audit Matter How the Key Audit Matter was addressed in our audit
No.
2 Provision for credit loss for accounts receivables We evaluated the judgement and estimation used by
Refer Note 11 of Financial statement. management in recognizing the expected credit loss
provision. Our procedures included, but were not limited to
Trade receivables as on March 31, 2020 amounts to ` 1,454.94
million against which provision of ` 323.32 million was made the following:
towards expected credit loss in the books of account. 1. Obtained understating of the Holding Company’s policy on
We have identified provisioning for credit loss as a key assessment of impairment of trade receivables, including
audit matter as the calculation of credit loss provision is a design and implementation of controls, validation of
complex area and requires management to make significant management review controls. We have tested the
assumptions on customer payment behavior and estimating operating effectiveness of these controls.
the level and timing of expected future cash flows. 2. Requested for and obtained independent balance
confirmations from the Holding Company’s customers on
sample basis.
3. Tested subsequent receipts after the year-end to on
sample basis.
4. Tested ageing of trade receivables for a sample of
customer transactions.
5. Obtained management comments and recovery plans for
trade receivables outstanding for more than 180 days
6. Assessed the trade receivables impairment methodology
applied in the current year and compared the Holding
Company’s provisioning rates against historical collection
data.
3 Assessment of Covid-19 Impact Our audit procedures in respect of this area include but are
The World Health Organization announced a global not limited to:
health emergency because of a new strain of coronavirus 1. Testing the design and operating effectiveness of key
(“COVID-19”) and classified its outbreak as a pandemic on controls (including application controls) over revenue
March 11, 2020. On March 24, 2020, the Indian government recognition and provisions relating to expenses and
announced a strict 21-day lockdown across the country impairment.
to contain the spread of the virus, which has been further 2. Testing of Application controls include testing of
extended till May 31, 2020. This pandemic and response automated controls, reports and system reconciliations.
are creating disruption in global supply chain and adversely
3. Selecting samples based on quantitative and qualitative
impacting most of the industries which has resulted in global
risk factors
slowdown.
4. Testing the selected samples for cut off over revenue
The management has made an assessment of the impact of
recognition
COVID-19 on the Holding Company’s operations, financial
performance and position as at and for the year ended March 5. Testing the selected sample to assess its correct
31, 2020 and has concluded that no there is no impact which classification and provision amount as per extant policy.
is required to be recognised in the financial statements. 6. Verified the management evaluation over assessment of
The full extent and duration of the impact of COVID-19 is Going Concern assumption and Impairment provisions.
currently unknown and the provision made by the Holding
Company based on its estimates involves a significant
amount of judgement including the duration and spread of
the pandemic and any new information that may emerge
concerning the severity of the virus, its spread to other
regions and the actions to contain the virus or treat its impact,
among others. Hence, we have ascertained the assessment
of the impact of Covid-19 as a Key Audit Matter.
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Corporate Overview Statutory Reports Financial Statements
Information Other than the Consolidated Financial In preparing the consolidated financial statements, the
Statements and Auditor’s Report Thereon respective Board of Directors of the companies included in the
The Holding Company’s Board of Directors is responsible Group are responsible for assessing the ability of the Group to
for the other information. The other information comprises continue as a going concern, disclosing, as applicable, matters
the information included in the Director’s Report including related to going concern and using the going concern basis
Annexures to the Director’s Report in the Annual Report of of accounting unless the Board of Directors either intends to
the Holding Company but does not include the consolidated liquidate the Group or to cease operations, or has no realistic
financial statements and our auditor’s report thereon. alternative but to do so.
Our opinion on the consolidated financial statements does not The respective Board of Directors of the companies included
cover the other information and we do not express any form of in the Group are responsible for overseeing the financial
assurance conclusion thereon. reporting process of the Group.
In connection with our audit of the consolidated financial Auditor’s Responsibilities for the Audit of the Consolidated
statements, our responsibility is to read the other information Financial Statements
and, in doing so, consider whether the other information Our objectives are to obtain reasonable assurance about
is materially inconsistent with the consolidated financial whether the consolidated financial statements as a whole
statements or our knowledge obtained in the audit or are free from material misstatement, whether due to fraud
otherwise appears to be materially misstated. If, based on the or error, and to issue an auditor’s report that includes our
work we have performed, we conclude that there is a material opinion. Reasonable assurance is a high level of assurance,
misstatement of this other information, we are required to but is not a guarantee that an audit conducted in accordance
report that fact. We have nothing to report in this regard. with Standards on Auditing (“SAs”) will always detect a material
misstatement when it exists. Misstatements can arise from
Responsibilities of Management and Those Charged with
fraud or error and are considered material if, individually
Governance for the Consolidated Financial Statements
or in the aggregate, they could reasonably be expected to
The Holding Company’s Board of Directors is responsible
influence the economic decisions of users taken on the basis
for the preparation and presentation of these consolidated
of these consolidated financial statements.
financial statements in term of the requirements of the Act
that give a true and fair view of the consolidated financial We give in “Annexure A” a detailed description of Auditor’s
position, consolidated financial performance and consolidated responsibilities for Audit of the Consolidated Financial
cash flows of the Group in accordance with the accounting Statements.
principles generally accepted in India, including the Other Matters
Accounting Standards specified under section 133 of the Act. a. We did not audit the financial statements of 4 subsidiaries
The respective Board of Directors of the companies included whose financial statements reflect total assets of
in the Group are responsible for maintenance of adequate ` 83.51 million as at March 31, 2020, total revenues of
accounting records in accordance with the provisions of the ` 51.29 million and net cash inflows amounting to ` 11.66
Act for safeguarding the assets of the Group and for preventing million for the year ended on that date, as considered
and detecting frauds and other irregularities; the selection in the consolidated financial statements. These financial
and application of appropriate accounting policies; making statements have been audited by other auditors whose
judgments and estimates that are reasonable and prudent; reports have been furnished to us by the Management
and the design, implementation and maintenance of adequate and our opinion on the consolidated financial statements,
internal financial controls, that were operating effectively for in so far as it relates to the amounts and disclosures
ensuring accuracy and completeness of the accounting included in respect of these subsidiaries and our report
records, relevant to the preparation and presentation of the in terms of sub-section (3) of Section 143 of the Act, in
consolidated financial statements that give a true and fair view so far as it relates to the aforesaid subsidiaries, is based
and are free from material misstatement, whether due to fraud solely on the reports of the other auditors.
or error, which have been used for the purpose of preparation b. The consolidated Ind AS financial statements of the
of the consolidated financial statements by the Directors of Company for the year ended March 31, 2019, were
the Holding Company, as aforesaid. audited by another auditor whose report dated May
10, 2019 expressed an unmodified opinion on those
statements.
Our opinion on the consolidated financial statements, and Directors of the Holding Company none of the
our report on Other Legal and Regulatory Requirements directors is disqualified as on March 31, 2020 from
below, is not modified in respect of the above matters with being appointed as a director in terms of Section
respect to our reliance on the work done and the reports 164 (2) of the Act.
of the other auditors and the financial statements and Requirement of Section 164 (2) of the Act is not
other financial information certified by the Management. applicable to all the 4 subsidiaries which are
Report on Other Legal and Regulatory Requirements incorporated outside India.
1. As required by Section 143(3) of the Act, we report, to the f. With respect to the adequacy of internal financial
extent applicable, that: controls over financial reporting of the Group and
a. We have sought and obtained all the information and the operating effectiveness of such controls, refer
explanations which to the best of our knowledge to our separate report in “Annexure B”.
and belief were necessary for the purposes of g. With respect to the other matters to be included in
our audit of the aforesaid consolidated financial the Auditor’s Report in accordance with Rule 11 of
statements. the Companies (Audit and Auditor’s) Rules, 2014, in
b. In our opinion, proper books of account as required our opinion and to the best of our information and
by law relating to preparation of the aforesaid according to the explanations given to us:
consolidated financial statements have been kept i. The consolidated financial statements disclose
so far as it appears from our examination of those the impact of pending litigations on the
books and the reports of the other auditors. consolidated financial position of the Group
c. The Consolidated Balance Sheet, the Consolidated – Refer Note 32 (c) & (d) to the consolidated
Statement of Profit and Loss, the Consolidated financial statements.
Statement of Changes in Equity and the Consolidated ii. The Group did not have any material
Statement of Cash Flow dealt with by this Report are foreseeable losses on long-term contracts
in agreement with the relevant books of account including derivative contracts.
maintained for the purpose of preparation of the
iii. There has been no delay in transferring
consolidated financial statements.
amounts, required to be transferred, to the
d. In our opinion, the aforesaid consolidated financial Investor Education and Protection Fund by the
statements comply with the Accounting Standards Holding Company.
specified under Section 133 of the Act read with
2. As required by The Companies (Amendment) Act, 2017, in
Rule 7 of the Companies (Accounts) Rules, 2014.
our opinion, according to information, explanations given
e. On the basis of the written representations received to us, the remuneration paid by the Holding Company
from the directors of the Holding Company as on to its directors is within the limits laid prescribed under
March 31, 2020 taken on record by the Board of Section 197 of the Act and the rules thereunder.
112
Corporate Overview Statutory Reports Financial Statements
Auditor’s Responsibilities for the Audit of the Consolidated disclosures, and whether the consolidated financial
Financial Statements statements represent the underlying transactions and
As part of an audit in accordance with SAs, we exercise events in a manner that achieves fair presentation.
professional judgment and maintain professional skepticism • Obtain sufficient appropriate audit evidence regarding
throughout the audit. We also: the financial information of the entities or business
• Identify and assess the risks of material misstatement activities within the Group to express an opinion on the
of the consolidated financial statements, whether due consolidated financial statements. We are responsible
to fraud or error, design and perform audit procedures for the direction, supervision and performance of the
responsive to those risks, and obtain audit evidence that audit of the financial statements of such entities included
is sufficient and appropriate to provide a basis for our in the consolidated financial statements of which we are
opinion. The risk of not detecting a material misstatement the independent auditors. For the other entities included
resulting from fraud is higher than for one resulting from in the consolidated financial statements, which have
error, as fraud may involve collusion, forgery, intentional been audited by other auditors, such other auditors
omissions, misrepresentations, or the override of internal remain responsible for the direction, supervision and
control. performance of the audits carried out by them. We
• Obtain an understanding of internal control relevant to remain solely responsible for our audit opinion.
the audit in order to design audit procedures that are We communicate with those charged with governance of
appropriate in the circumstances. Under section 143(3)(i) the Holding Company and such other entities included in
of the Act, we are also responsible for expressing our the consolidated financial statements of which we are the
opinion on whether the company has internal financial independent auditors regarding, among other matters, the
controls with reference to financial statements in place planned scope and timing of the audit and significant audit
and the operating effectiveness of such controls. findings, including any significant deficiencies in internal
• Evaluate the appropriateness of accounting policies control that we identify during our audit.
used and the reasonableness of accounting estimates We also provide those charged with governance with a
and related disclosures made by management. statement that we have complied with relevant ethical
• Conclude on the appropriateness of management’s use requirements regarding independence, and to communicate
of the going concern basis of accounting and, based with them all relationships and other matters that may
on the audit evidence obtained, whether a material reasonably be thought to bear on our independence, and
uncertainty exists related to events or conditions that where applicable, related safeguards.
may cast significant doubt on the ability of the Group From the matters communicated with those charged with
to continue as a going concern. If we conclude that a governance, we determine those matters that were of
material uncertainty exists, we are required to draw most significance in the audit of the consolidated financial
attention in our auditor’s report to the related disclosures statements of the current period and are therefore the key
in the consolidated financial statements or, if such audit matters. We describe these matters in our auditor’s
disclosures are inadequate, to modify our opinion. Our report unless law or regulation precludes public disclosure
conclusions are based on the audit evidence obtained about the matter or when, in extremely rare circumstances,
up to the date of our auditor’s report. However, future we determine that a matter should not be communicated in
events or conditions may cause the Group to cease to our report because the adverse consequences of doing so
continue as a going concern. would reasonably be expected to outweigh the public interest
• Evaluate the overall presentation, structure and content benefits of such communication.
of the consolidated financial statements, including the
For MSKA & Associates
Chartered Accountants
ICAI Firm Registration No. 105047W
[Referred to in paragraph 2(f) under ‘Report on Other audit to obtain reasonable assurance about whether internal
Legal and Regulatory Requirements’ in the Independent financial controls with reference to consolidated financial
Auditors’ Report of even date to the Members of Quick statements was established and maintained and if such
Heal Technologies Limited on the consolidated Financial controls operated effectively in all material respects.
Statements for the year ended March 31, 2020] Our audit involves performing procedures to obtain audit
Report on the Internal Financial Controls under Clause (i) evidence about the internal financial controls with reference
of Sub-section 3 of Section 143 of the Companies Act, 2013 to consolidated financial statements and their operating
(“the Act”) effectiveness. Our audit of internal financial controls with
In conjunction with our audit of the consolidated financial reference to consolidated financial statements included
statements of the Company as of and for the year ended obtaining an understanding of internal financial controls with
March 31, 2020, we have audited the internal financial controls reference to consolidated financial statements, assessing the
with reference to consolidated financial statements of Quick risk that a material weakness exists, and testing and evaluating
Heal Technologies Limited (hereinafter referred to as “the the design and operating effectiveness of internal control
Holding Company”). based on the assessed risk. The procedures selected depend
Clause (i) of Sub-section 3 of Section 143 is not applicable to all on the auditor’s judgement, including the assessment of the
the 4 subsidaries which are incorporated outside India. risks of material misstatement of the consolidated financial
statements, whether due to fraud or error.
Management’s Responsibility for Internal Financial Controls
The Board of Directors of the Holding company are We believe that the audit evidence we have obtained is
responsible for establishing and maintaining internal financial sufficient and appropriate to provide a basis for our audit
controls based on the internal control with reference to opinion on the internal financial controls with reference to
consolidated financial statements criteria established by the consolidated financial statements of the Holding company.
Holding Company considering the essential components Meaning of Internal Financial Controls With Reference to
of internal control stated in the Guidance Note on Audit of Consolidated Financial Statements
Internal Financial Controls Over Financial Reporting issued A Holding company’s internal financial control with reference
by the Institute of Chartered Accountants of India (“the ICAI”). to consolidated financial statements is a process designed
These responsibilities include the design, implementation to provide reasonable assurance regarding the reliability of
and maintenance of adequate internal financial controls financial reporting and the preparation of consolidated financial
that were operating effectively for ensuring the orderly and statements for external purposes in accordance with generally
efficient conduct of its business, including adherence to the accepted accounting principles. A Holding company’s internal
Holding company policies, the safeguarding of its assets, the financial control with reference to consolidated financial
prevention and detection of frauds and errors, the accuracy statements includes those policies and procedures that (1)
and completeness of the accounting records, and the timely pertain to the maintenance of records that, in reasonable detail,
preparation of reliable financial information, as required under accurately and fairly reflect the transactions and dispositions
the Act. of the assets of the Holding company; (2) provide reasonable
Auditor’s Responsibility assurance that transactions are recorded as necessary to
Our responsibility is to express an opinion on the internal permit preparation of consolidated financial statements in
financial controls with reference to consolidated financial accordance with generally accepted accounting principles,
statements of the Holding company based on our audit. We and that receipts and expenditures of the Holding company
conducted our audit in accordance with the Guidance Note on are being made only in accordance with authorizations of
Audit of Internal Financial Controls Over Financial Reporting management and directors of the Holding company; and (3)
(the “Guidance Note”) issued by the ICAI and the Standards provide reasonable assurance regarding prevention or timely
on Auditing prescribed under section 143(10) of the Act, to detection of unauthorized acquisition, use, or disposition of
the extent applicable to an audit of internal financial controls. the Holding company’s assets that could have a material
Those Standards and the Guidance Note require that we effect on the consolidated financial statements.
comply with ethical requirements and plan and perform the
114
Corporate Overview Statutory Reports Financial Statements
Notes As at As at
March 31, 2020 March 31, 2019
Assets
Non-current assets
(a) Property, plant and equipment 5 1,485.09 1,570.04
(b) Capital work-in-progress 34.00 106.33
(c) Intangible assets 6 99.81 77.08
(d) Financial assets
(i) Investments 7 353.32 296.23
(ii) Loans and security deposits 8 3.81 3.75
(iii) Other financial assets 9 3.91 4.04
(e) Deferred tax assets (net) 29 25.86 86.69
(f) Income tax assets (net) 14 167.92 45.54
(g) Other non-current assets 15 5.32 0.52
2,179.04 2,190.22
Current assets
(a) Inventories 10 62.40 53.94
(b) Financial assets
(i) Investments 7 2,745.22 3,602.17
(ii) Trade receivables 11 1,131.62 1,250.52
(iii) Cash and cash equivalents 12 100.72 129.56
(iv) Bank balances other than (iii) above 13 699.53 1,219.44
(v) Loans and security deposits 8 7.74 7.09
(vi) Interest accrued 9 15.26 30.59
(c) Other current assets 15 24.13 44.74
4,786.62 6,338.05
Total Assets 6,965.66 8,528.27
Equity and liabilities
Equity
(a) Equity share capital 16 642.03 705.63
(b) Share application money pending allotment 16 - 0.17
(c) Other equity 17
(i) Retained earnings 4,707.81 4,418.83
(ii) Securities premium 593.84 2,343.38
(iii) Amalgamation reserve 26.45 26.45
(iv) General reserve 450.26 450.26
(v) Capital redemption reserve 63.64 -
(vi) Other reserves (43.35) (47.13)
Total equity 6,440.68 7,897.59
Liabilities
Non-current liabilities
(a) Net employee defined benefit liabilities 21 4.62 18.37
(b) Other non-current liabilities 20 19.63 19.53
24.25 37.90
Current liabilities
(a) Financial liabilities
(i) Trade payables
(a) Total outstanding dues of micro enterprises and small enterprises 18 4.73 0.37
(b) Total outstanding dues creditors other than micro enterprises and
18 382.54 387.50
enterprises
(ii) Other financial liabilities 19 9.04 34.23
(b) Other current liabilities 20 86.68 135.76
(c) Net employee defined benefit liabilities 21 3.94 21.22
(d) Income tax liabilities (net) 22 13.80 13.70
500.73 592.78
Total liabilities 524.98 630.68
Total equity and liabilities 6,965.66 8,528.27
Summary of significant accounting policies 3
The accompanying notes form an integral part of the financial statements.
As per our report of even date For and on behalf of the Board of Directors of
For MSKA & Associates Quick Heal Technologies Limited
Chartered Accountants
ICAI Firm Registration Number: 105047W
Srinivasa Rao
Nitin Manohar Jumani Kailash Katkar Sanjay Katkar Nitin Kulkarni
Anasingaraju
Partner Managing Director Joint Managing Director Chief Financial Officer Company Secretary
Membership Number: 111700 & Chief Executive Officer & Chief Technical Officer
DIN: 00397191 DIN: 00397277 Regs. No. FCS-9901
Place: Pune Place: Pune Place: Pune Place: Pune Place: Pune
Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020
116
Corporate Overview Statutory Reports Financial Statements
As per our report of even date For and on behalf of the Board of Directors of
For MSKA & Associates Quick Heal Technologies Limited
Chartered Accountants
ICAI Firm Registration Number: 105047W
Srinivasa Rao
Nitin Manohar Jumani Kailash Katkar Sanjay Katkar Nitin Kulkarni
Anasingaraju
Partner Managing Director Joint Managing Director Chief Financial Officer Company Secretary
Membership Number: 111700 & Chief Executive Officer & Chief Technical Officer
DIN: 00397191 DIN: 00397277 Regs. No. FCS-9901
Place: Pune Place: Pune Place: Pune Place: Pune Place: Pune
Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020
118
Corporate Overview Statutory Reports Financial Statements
As per our report of even date For and on behalf of the Board of Directors of
For MSKA & Associates Quick Heal Technologies Limited
Chartered Accountants
ICAI Firm Registration Number: 105047W
Srinivasa Rao
Nitin Manohar Jumani Kailash Katkar Sanjay Katkar Nitin Kulkarni
Anasingaraju
Partner Managing Director Joint Managing Director Chief Financial Officer Company Secretary
Membership Number: 111700 & Chief Executive Officer & Chief Technical Officer
DIN: 00397191 DIN: 00397277 Regs. No. FCS-9901
Place: Pune Place: Pune Place: Pune Place: Pune Place: Pune
Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020
120
Corporate Overview Statutory Reports Financial Statements
2. Basis of preparation The financial statements of all entities used for the
purpose of consolidation are drawn up to same reporting
The consolidated financial statements of the Group have
date as that of the Holding Company, i.e., year ended on
been prepared in accordance with Indian Accounting
March 31.
Standards (“Ind AS”) notified under Section 133 of the
Companies Act, 2013 read with Indian Accounting In preparing the consolidated financial statements,
Standards Rules, 2015, as amended and other relevant the Group has used the following key consolidation
provisions of the Act. procedures:
The consolidated financial statements have been a) Combine like items of assets, liabilities, equity,
prepared on a historical cost basis, except for certain income, expenses and cash flows of the Holding
financial assets which have been measured at fair value. Company with those of its subsidiaries. For this
The consolidated financial statements are presented in ` purpose, income and expenses of the subsidiary
millions; except when otherwise indicated. are based on the amounts of assets and liabilities
recognised in the consolidated financial statements
Items Measurement basis
at the acquisition date.
Certain non-derivative financial
Fair value
instruments at fair value b) Offset (eliminate) the carrying amount of the Holding
Equity-settled share based Fair value on the date Company’s investment in each subsidiary and
payment transactions of grant the Holding Company’s portion of equity of each
Defined benefit plan assets Fair value subsidiary.
3. Summary of significant accounting policies c) Eliminate in full intragroup assets and liabilities,
equity, income, expenses and cash flows relating to
The following are the significant accounting policies
transactions between entities of the group. Profits
applied by the Group in preparing its consolidated
or losses resulting from intragroup transactions
financial statements:
that are recognised in assets, such as inventory
a) Principles of consolidation and property, plant and equipment, are eliminated
The consolidated financial statements comprise the in full. However, intragroup losses may indicate
financial statements of the Company and its subsidiaries an impairment that requires recognition in the
as at March 31, 2020. Control is achieved when the consolidated financial statements. Ind AS 12 -
Income Taxes applies to temporary differences rate if the average approximates the actual rate at
that arise from the elimination of profits and losses the date of transaction.
resulting from intragroup transactions. Monetary assets and liabilities denominated in
b) Current versus non-current classification foreign currencies are translated at the functional
currency spot rates of exchange at the reporting
The Group presents assets and liabilities in the balance
date. Exchange differences arising on settlement
sheet based on current/non-current classification.
or translation of monetary items are recognised in
An asset is treated as current when it is: statement of profit and loss.
• Expected to be realised or intended to be sold or Non-monetary items that are measured in terms of
consumed in the normal operating cycle; historical cost in a foreign currency are translated
• Held primarily for the purpose of trading; using the exchange rates at the dates of the initial
• Expected to be realised within twelve months after transactions. Non-monetary items measured at fair
the reporting period; or value in a foreign currency are translated using the
• Cash or cash equivalent unless restricted from exchange rates at the date when the fair value is
being exchanged or used to settle a liability for at determined. The gain or loss arising on translation
least twelve months after the reporting period. of non-monetary items measured at fair value is
treated in line with the recognition of the gain or
All other assets are classified as non-current.
loss on the change in fair value of the item (i.e.,
A liability is treated as current when: translation differences on items whose fair value
• It is expected to be settled in the normal operating gain or loss is recognised in Other comprehensive
cycle; income (‘OCI’) or statement of profit and loss are
• It is held primarily for the purpose of trading; also recognised in OCI or statement of profit and
loss, respectively).
• It is due to be settled within twelve months after the
reporting period; or (ii) Group companies
• There is no unconditional right to defer the On consolidation, the assets and liabilities of the
settlement of the liability for at least twelve months subsidiaries are translated into Indian Rupees at the
after the reporting period. rate of exchange prevailing at the reporting date
The Group classifies all other liabilities as non-current. and their statements of profit and loss are translated
at average exchange rates. Equity items, other than
Deferred tax assets and liabilities are classified as non-
retained earnings, are translated at the spot rate
current assets and liabilities.
in effect on each related transaction date (specific
Operating cycle of the Group is the time between the identification). Retained earnings are translated
acquisition of assets for processing and their realisation in at the weighted average exchange rate for the
cash or cash equivalents. The Group’s normal operating relevant year.
cycle has been considered to be twelve months.
The exchange differences arising on translation for
c) Foreign currencies consolidation are recognised in OCI.
The Group’s consolidated financial statements are d) Fair value measurement
presented in Indian Rupees, which is also the functional
The Group measures financial instruments such as
currency of the Holding Company. For each entity, the
investments in equity shares at fair value at each balance
Group determines the functional currency and items
sheet date.
included in the financial statements of each entity are
measured using that functional currency. Fair value is the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction
(i) Transaction and balances between market participants at the measurement date.
Transactions in foreign currencies are initially The fair value measurement is based on the presumption
recorded by the Group’s entities at their respective that the transaction to sell the asset or transfer the liability
functional currency spot rates at the date the takes place either:
transaction first qualifies for recognition. However, • In the principal market for the asset or liability, or
for practical reasons, the Group uses an average
122
Corporate Overview Statutory Reports Financial Statements
• In the absence of a principal market, in the most • Quantitative disclosures of fair value measurement
advantageous market for the asset or liability. hierarchy (Note 39)
The principal or the most advantageous market must be • Financial instruments risk management objectives
accessible by the Group. and policies (Note 40)
The fair value of an asset or a liability is measured using e) Revenue recognition
the assumptions that market participants would use
Revenue is recognized upon transfer of control of
when pricing the asset or liability, assuming that market
promised products or services to customers in an amount
participants act in their economic best interest.
that reflects the consideration expected to be received in
A fair value measurement of a non-financial asset takes exchange for those products or services.
into account a market participant’s ability to generate
Goods and Services Tax (GST) and all other applicable
economic benefits by using the asset in its highest and
taxes is not received by the Group on its own account.
best use or by selling it to another market participant that
Rather, it is tax collected on value added to the commodity
would use the asset in its highest and best use.
by the seller on behalf of the government and, therefore,
The Group uses valuation techniques that are appropriate these are not economic benefits flowing to the Group.
in the circumstances and for which sufficient data are Accordingly, it is excluded from revenue. The following
available to measure fair value, maximising the use of specific recognition criteria must also be met before
relevant observable inputs and minimising the use of revenue is recognized:
unobservable inputs.
(i) Sale of security software products and
All assets and liabilities for which fair value is measured
devices:
or disclosed in the consolidated financial statements are
categorised within the fair value hierarchy, described as Revenue from the sale of security software products
follows, based on the lowest level input that is significant and devices (goods) is recognised when control of
to the fair value measurement as a whole: the goods are transferred to the customer at an
amount that reflects the consideration to which
• Level 1 - Quoted (unadjusted) market prices in active
the company expects to be entitled in exchange
markets for identical assets or liabilities
for those goods. Revenue from the sale of goods
• Level 2 - Valuation techniques for which the is measured at the fair value of the consideration
lowest level input that is significant to the fair value received or receivable, net of returns and
measurement is directly or indirectly observable allowances, trade discounts and volume rebates.
• Level 3 - Valuation techniques for which the In arrangements for sale of security software, the
lowest level input that is significant to the fair value Group has applied the guidance in Ind AS 115,
measurement is unobservable Revenue, by applying the revenue recognition
For assets and liabilities that are recognised in the criteria for each separately identifiable component
consolidated financial statements on a recurring basis, of a single transaction. The arrangements
the Group determines whether transfers have occurred generally meet the criteria for considering sale
between levels in the hierarchy by re-assessing of security software and related services as
categorisation (based on the lowest level input that is separately identifiable components. For allocating
significant to the fair value measurement as a whole) at the consideration, the Group has measured the
the end of each reporting period. revenue in respect of each separable component
For the purpose of fair value disclosures, the Group of a transaction at its fair value, in accordance with
has determined classes of assets and liabilities on the principles given in Ind AS 115. The Group allocates
basis of the nature, characteristics and risks of the asset and defers revenue for the undelivered items based
or liability and the level of the fair value hierarchy, as on the fair value of the undelivered elements.
explained above. Contract balances:
This note summarises accounting policy for fair value. Contract assets
Other fair value related disclosures are given in the
A contract asset is the right to consideration in
relevant notes.
exchange for goods or services transferred to the
• Significant accounting judgements, estimates and customer. If the Group performs by transferring
assumptions (Note 4) goods or services to a customer before the
customer pays consideration or before payment is When calculating the EIR, the Group estimates
due, a contract asset is recognised for the earned the expected cash flows by considering all the
consideration that is conditional. contractual terms of the financial instrument but
does not consider the expected credit losses.
Trade receivables
Interest income is included under the head “Other
A receivable represents the Group’s right to an income” in the statement of profit and loss.
amount of consideration that is unconditional (i.e.,
only the passage of time is required before payment (ii) Dividends
of the consideration is due). Refer to accounting Income from dividend on investments is accrued in
policies of financial assets in section (q) Financial the year in which it is declared, whereby the Group’s
instruments – initial recognition and subsequent right to receive is established. Dividend income is
measurement. included under the head “finance income” in the
statement of profit and loss.
Contract liabilities
A contract liability is the obligation to transfer g) Taxes
goods or services to a customer for which the Current income tax
Group has received consideration (or an amount Current income tax assets and liabilities are measured
of consideration is due) from the customer. If a at the amount expected to be recovered from or paid to
customer pays consideration before the Group the taxation authorities. The tax rates and tax laws used
transfers goods or services to the customer, a to compute the amount are those that are enacted or
contract liability is recognised when the payment is substantively enacted at the reporting date.
made or the payment is due (whichever is earlier).
Current income tax relating to items recognised outside
Contract liabilities are recognised as revenue when
profit and loss is recognised outside profit and loss (either
the Group performs under the contract.
in OCI or in equity). Current tax items are recognised in
(ii) Income from services: correlation to the underlying transaction either in OCI or
Revenues from support services are recognized directly in equity. Management periodically evaluates
as and when services are rendered. The Company positions taken in the tax returns with respect to
collects GST on behalf of the government and, situations in which applicable tax regulations are subject
therefore, it is not an economic benefit flowing to to interpretation and establishes provisions where
the Company. Hence, it is excluded from revenue. appropriate.
The Company has applied the principal under Ind Deferred tax is provided using the liability method on
AS 115 to identify each performance obligation on temporary differences between the tax bases of assets
licenses sold to customer. Revenue for identified and liabilities and their carrying amounts for financial
performance obligation is recognised over the reporting purposes at the reporting date.
period of time, when such performance obligation Deferred tax liabilities are recognised for all taxable
is rendered. In absence of standalone selling price temporary differences, except:
of the performance obligation, the contract price • When the deferred tax liability arises from the initial
are allocated to each performance obligation of the recognition of goodwill or an asset or liability in a
contract on the basis of cost plus margin approach. transaction that is not a business combination and,
f) Other income at the time of the transaction, affects neither the
accounting profit nor taxable profit and loss;
(i) Interest
• In respect of taxable temporary differences
Interest income is accrued on a time basis, by
associated with investments in subsidiaries,
reference to the principal outstanding and at the
when the timing of the reversal of the temporary
effective interest rate (‘EIR’) applicable. The EIR is
differences can be controlled and it is probable that
the rate that exactly discounts the estimated future
the temporary differences will not reverse in the
cash receipts over the expected life of the financial
foreseeable future
instrument or a shorter period, where appropriate,
to the net carrying amount of the financial asset.
124
Corporate Overview Statutory Reports Financial Statements
Deferred tax assets are recognised for all deductible The cost comprises of the purchase price, and directly
temporary differences, the carry forward of unused attributable costs of bringing the asset to its working
tax credits and any unused tax losses. Deferred tax condition for the intended use. Any trade discounts and
assets are recognised to the extent that it is probable rebates are deducted in arriving at the purchase price.
that taxable profit will be available against which the Each part of item of property, plant and equipment with
deductible temporary differences, and the carry forward a cost that is significant in relation to the total cost of the
of unused tax credits and unused tax losses can be item is depreciated separately. This applies mainly to
utilised except: components for machinery.
• When the deferred tax asset relating to the Capital work in progress comprises of the cost of
deductible temporary difference arises from property, plant and equipment that are not yet ready for
the initial recognition of an asset or liability in a their intended use as at the balance sheet date.
transaction that is not a business combination and, Depreciation on property, plant and equipment is
at the time of the transaction, affects neither the calculated on a written down value (WDV) basis using
accounting profit nor taxable profit and loss; the rates arrived at based on the useful lives estimated
• In respect of deductible temporary differences by the management. The Group has used the following
associated with investments in subsidiaries, rates to provide depreciation on its property, plant and
associates and interest in joint ventures, deferred equipment.
tax assets are recognised only to the extent that it is
Type of Schedule Useful lives Rates
probable that the temporary differences will reverse
assets II life estimated (WDV)
in the foreseeable future and taxable profit will be
(years) by the
available against which the temporary differences management
can be utilised. (years)
The carrying amount of deferred tax assets is reviewed Buildings 60 60 4.87%
at each reporting date and reduced to the extent that 21.90% -
it is no longer probable that sufficient taxable profit will Computers 3 3
63.16%
be available to allow all or part of the deferred tax asset
Electrical
to be utilised. Unrecognised deferred tax assets are re- 10 10 25.89%
installations
assessed at each reporting date and are recognised to
Furniture and 12.00% -
the extent that it has become probable that future taxable 10 10-23
fixtures 25.89%
profits will allow the deferred tax asset to be recovered.
Office 14.20% -
Deferred tax assets and liabilities are measured at the 5 5-15
equipment 45.07%
tax rates that are expected to apply in the year when
Server 6 6 39.30%
the asset is realised or the liability is settled, based
25.00% -
on tax rates (and tax laws) that have been enacted or Vehicles 8 8
31.23%
substantively enacted at the reporting date.
Leasehold premises are amortized on a straight-line
Deferred tax relating to items recognised outside profit
basis over the period of lease, i.e. 30 years.
and loss is recognised outside profit and loss (either in
OCI or in equity). Deferred tax items are recognised in An item of property, plant and equipment is derecognised
correlation to the underlying transaction either in OCI or upon disposal or when no future economic benefits
directly in equity. are expected from its use or disposal. Any gain or loss
arising on derecognition of the asset (calculated as the
Deferred tax assets and deferred tax liabilities are offset
difference between the net disposal proceeds and the
if a legally enforceable right exists to set off current tax
carrying amount of the asset) is included in the statement
assets against current tax liabilities and the deferred
of profit and loss when the asset is derecognised.
taxes relate to the same taxable entity and the same
taxation authority. The residual values, useful lives and methods of
depreciation of property, plant and equipment are
h) Property, plant and equipment reviewed at each financial year end and adjusted
Property, plant and equipment and capital work prospectively, if appropriate.
in progress are stated at cost net of accumulated
depreciation and impairment losses, if any.
126
Corporate Overview Statutory Reports Financial Statements
the rate inherent in the lease unless this is not readily k) Inventories
determinable, in which case the entities incremental Inventories are valued at the lower of cost and net
borrowing rate on commencement of the lease is realisable value.
used. Variable lease payments are only included in the
Cost of inventories have been computed to include all
measurement of the lease liability if they depend on
cost of purchases, cost of conversion and other costs
an index or rate. In such cases, the initial measurement
incurred in bringing the inventories to their present
of the lease liability assumes the variable element will
location and condition.
remain unchanged throughout the lease term. Other
• Raw materials are valued at lower of cost and net
variable lease payments are expensed in the period to
realizable value. However, materials and other
which they relate.
items held for use in the production of inventories is
On initial recognition, the carrying value of the lease
not written down below cost of the finished product
liability also includes:
in which they will be incorporated are expected to
• amounts expected to be payable under any residual be sold at or above cost. Cost of raw material is
value guarantee; determined on a weighted average basis.
• the exercise price of any purchase option granted • Finished goods are valued at lower of cost and net
in favour of the group if it is reasonable certain to realizable value. Cost includes direct material and
assess option; labour and a proportion of manufacturing overhead
• any penalties payable for terminating the lease, if based on normal operating capacity. Cost is
the term of the lease has been estimated determined on a weighted average basis.
on the basis of termination option being exercised. • Traded goods are valued at lower of cost and net
Right of use assets are initially measured at the amount realizable value. Cost included cost of purchase and
of the lease liability, reduced for any lease incentives other costs incurred in bringing the inventories to
received, and increased for: present location and condition. Cost is determined
on weighted average basis.
• lease payments made at or before commencement
of the lease;
• initial direct costs incurred; and Net realizable value is the estimated selling price in the
ordinary course of business, less estimated costs of
• the amount of any provision recognised where the
completion and estimated costs necessary to make the
group is contractually required to dismantle, remove
sale.
or restore the leased asset
Subsequent to initial measurement lease liabilities l) Impairment of non-financial assets
increase as a result of interest charged at a constant rate The Group assesses at each reporting date whether
on the balance outstanding and are reduced for lease there is an indication that an asset may be impaired. If
payments made. Right-of-use assets are amortised on a any indication exists, or when annual impairment testing
straight-line basis over the remaining term of the lease for an asset is required, the Group estimates the asset’s
or over the remaining economic life of the asset if, rarely, recoverable amount. An asset’s recoverable amount is
this is judged to be shorter than the lease term. the higher of an asset’s or cash-generating unit’s (CGU)
When the group revises its estimate of the term of any fair value less costs to sell and its value in use. It is
lease, it adjusts the carrying amount of the lease liability determined for an individual asset, unless the asset does
to reflect the payments to make over the revised term, not generate cash inflows that are largely independent
which are discounted at the same discount rate that of those from other assets or group of assets. When
applied on lease commencement. The carrying value the carrying amount of an asset or CGU exceeds its
of lease liabilities is similarly revised when the variable recoverable amount, the asset is considered impaired
element of future lease payments dependent on a rate or and is written down to its recoverable amount.
index is revised. In both cases an equivalent adjustment In assessing value in use, the estimated future cash flows
is made to the carrying value of the right-of-use asset, are discounted to their present value using a pre-tax
with the revised carrying amount being amortised over discount rate that reflects current market assessments
the remaining (revised) lease term. of the time value of money and the risks specific to
the asset. In determining fair value less costs to sell, When the Group expects some or all of a provision to be
recent market transactions are taken into account, if reimbursed, for example, under an insurance contract,
available. If no such transactions can be identified, an the reimbursement is recognised as a separate asset,
appropriate valuation model is used. These calculations but only when the reimbursement is virtually certain.
are corroborated by valuation multiples, quoted share The expense relating to a provision is presented in the
prices for publicly traded subsidiaries or other available statement of profit and loss net of any reimbursement.
fair value indicators. If the effect of the time value of money is material,
The Group bases its impairment calculation on detailed provisions are discounted using a current pre-tax rate
budgets and forecasts which are prepared separately for that reflects, when appropriate, the risks specific to the
each of the Group’s CGU to which the individual assets liability. When discounting is used, the increase in the
are allocated. These budgets and forecast calculations provision due to the passage of time is recognised as a
are generally covering a period of five years. For longer finance cost.
periods, a long-term growth rate is calculated and applied
n) Contingent liabilities
to project future cash flows after the fifth year.
A contingent liability is a possible obligation that arises
Impairment losses, including impairment on inventories,
from past events whose existence will be confirmed
are recognised in the statement of profit and loss in
by the occurrence or non-occurrence of one or more
those expense categories consistent with the function of
uncertain future events beyond the control of the Group
the impaired asset.
or a present obligation that is not recognized because it is
For assets excluding goodwill, an assessment is made not probable that an outflow of resources will be required
at each reporting date as to whether there is any
to settle the obligation. A contingent liability also arises in
indication that previously recognised impairment losses
extremely rare cases where there is a liability that cannot
may no longer exist or may have decreased. If such
be recognized because it cannot be measured reliably.
indication exists, the Group estimates the asset’s or
The Group does not recognize a contingent liability
CGU’s recoverable amount. A previously recognised
but discloses its existence in the consolidated financial
impairment loss is reversed only if there has been a
statements.
change in the assumptions used to determine the asset’s
recoverable amount since the last impairment loss was o) Retirement and other employee benefits
recognised. The reversal is limited so that the carrying a) Short-term employee benefits
amount of the asset does not exceed its recoverable
The distinction between short-term and long-term
amount, nor exceed the carrying amount that would have
employee benefits is based on expected timing of
been determined, net of depreciation, had no impairment
settlement rather than the employee’s entitlement
loss been recognised for the asset in prior years. Such
benefits. All employee benefits payable within twelve
reversal is recognised in the statement of profit and loss.
months of rendering the service are classified as
Impairment is determined for goodwill by assessing the
short-term benefits. Such benefits include salaries,
recoverable amount of each CGU (or group of CGUs)
wages, bonus, short term compensated absences,
to which the goodwill relates. When the recoverable
awards, ex-gratia, performance pay etc. and are
amount of the CGU is less than its carrying amount, an
recognised in the period in which the employee
impairment loss is recognised. Impairment losses relating
renders the related service.
to goodwill cannot be reversed in future periods.
Intangible assets with indefinite useful lives are tested b) Post-employment benefits
for impairment annually either individually or at the CGU In case of Holding Company:
level, as appropriate and when circumstances indicate
(i) Defined contribution plan
that the carrying value may be impaired.
The Company makes payment to provident
m) Provisions fund scheme which is defined contribution
A provision is recognized when the Group has a present plan. The contribution paid/payable under
obligation as a result of past event; it is probable that the schemes is recognised in the statement
an outflow of resources embodying economic benefits of profit and loss during the period in which
will be required to settle the obligation, and a reliable the employee renders the related service.
estimate can be made of the amount of the obligation.
128
Corporate Overview Statutory Reports Financial Statements
The Company has no further obligations Net interest is calculated by applying the
under these schemes beyond its periodic discount rate to the net defined benefit
contributions. liability or asset. The Company recognises the
The Company recognizes contribution following changes in the net defined benefit
payable to the provident fund scheme as an obligation as an expense in the statement of
profit and loss:
expenditure, when an employee renders the
related services. If the contribution payable • Service costs comprising current service
to the scheme for services received before costs, past-service costs, gains and
balance sheet date exceeds the contribution losses on curtailments and non-routine
already paid, the deficit payable to the scheme settlements; and
is recognized as a liability after deducting the • Net interest expense or income.
contribution already paid. If the contribution
c) Other long term employment benefits:
already paid exceeds the contribution due for
The Company treats accumulated leave expected
services received before the balance sheet
to be carried forward beyond twelve months, as
date, then the excess recognized as an asset
long-term employee benefit for measurement
to the extent that the pre-payment will lead to,
purposes. Such long-term compensated absences
for example, a reduction in future payment or
are provided for based on the actuarial valuation
cash refund.
using the projected unit credit method at the year
(ii) Defined benefit plan end. Actuarial gains/losses are immediately taken
The Company operates a defined benefit plan to the statement of profit and loss and are not
for its employees, viz. gratuity. The present deferred. The Company presents the leave as a
value of the obligation under such defined current liability in the Balance sheet to the extent
benefit plans is determined based on the it does not have an unconditional right to defer its
actuarial valuation using the Projected Unit settlement for 12 months after the reporting date.
Credit Method as at the date of the balance Where the Company has the unconditional legal
and contractual right to defer the settlement for a
sheet. The fair value of plan asset is reduced
period beyond 12 months, the same is presented as
from the gross obligation under the defined
non-current liability.
benefit plans, to recognise the obligation on a
net basis. In case of Subsidiaries:
Re-measurements, comprising of actuarial Retirement benefit in the form of provident fund
gains and losses, the effect of the asset ceiling, is a defined contribution scheme. The Group has
excluding amounts included in net interest on no obligation, other than the contribution payable
the net defined benefit liability and the return to the provident fund. The Group recognizes
on plan assets (excluding amounts included in contribution payable to the provident fund scheme,
net interest on the net defined benefit liability), National Social Security Fund (NSSF - Kenya) as
are recognised immediately in the balance an expenditure, when an employee renders the
sheet with a corresponding debit or credit to related services. If the contribution payable to the
retained earnings through OCI in the period in scheme for services received before balance sheet
which they occur. Re-measurements are not date exceeds the contribution already paid, the
reclassified to the statement of profit and loss deficit payable to the scheme is recognized as a
in subsequent periods. liability after deducting the contribution already
paid. If the contributions already paid exceeds the
Past service costs are recognised in statement
contribution due for services received before the
of profit and loss on the earlier of:
balance sheet date, then the excess recognized
• The date of the plan amendment or as an asset to the extent that the pre-payment will
curtailment; and lead to, for example, a reduction in future payment
• The date that the Company recognises or cash refund.
related restructuring costs There are no other long-term benefits payable to
employees of any of the overseas subsidiaries.
130
Corporate Overview Statutory Reports Financial Statements
ECL is the difference between all contractual cash designed to enable significant increases in credit
flows that are due to the Group in accordance risk to be identified on a timely basis. The Group
with the contract and all the cash flows that the does not have any purchased or originated credit-
entity expects to receive (i.e., all cash shortfalls), impaired (POCI) financial assets, i.e., financial assets
discounted at the original EIR. When estimating the which are credit impaired on purchase/ origination.
cash flows, an entity is required to consider:
a) Financial liabilities
- All contractual terms of the financial instrument
Initial recognition and measurement
(including prepayment, extension, call and
Financial liabilities are classified, at initial recognition,
similar options) over the expected life of
loans and borrowings or payables as appropriate.
the financial instrument. However, in rare
cases when the expected life of the financial All financial liabilities are recognised initially at fair
instrument cannot be estimated reliably, then value and, in the case of loans and borrowings and
the entity is required to use the remaining payables, net of directly attributable transaction
contractual term of the financial instrument costs.
- Cash flows from the sale of collateral held or The Group’s financial liabilities include trade and
other credit enhancements that are integral to other payables.
the contractual terms Subsequent measurement
As a practical expedient, the Group uses a provision The measurement of financial liabilities depends on
matrix to determine impairment loss allowance on their classification, as described below:
portfolio of its trade receivables. The provision
Derecognition
matrix is based on its historically observed default
rates over the expected life of the trade receivables A financial liability is derecognised when the
and is adjusted for forward-looking estimates. At obligation under the liability is discharged or
every reporting date, the historical observed default cancelled or expires. When an existing financial
rates are updated and changes in the forward- liability is replaced by another from the same
looking estimates are analysed. lender on substantially different terms, or the terms
of an existing liability are substantially modified,
ECL impairment loss allowance (or reversal)
such an exchange or modification is treated as
recognized during the period is recognized as
the derecognition of the original liability and the
expense/ (income) in the statement of profit and
recognition of a new liability. The difference in the
loss. This amount is reflected under the head ‘other
respective carrying amounts is recognised in the
expenses’ in the statement of profit and loss. The
statement of profit and loss.
balance sheet presentation for various financial
instruments is described below: Offsetting of financial instruments
- Financial assets measured as at amortised cost Financial assets and financial liabilities are offset
and contractual revenue receivables: ECL is and the net amount is reported in the consolidated
presented as an allowance, i.e., as an integral balance sheet if there is a currently enforceable
part of the measurement of those assets in legal right to offset the recognised amounts and
the balance sheet. The allowance reduces there is an intention to settle on a net basis, to realise
the net carrying amount. Until the asset meets the assets and settle the liabilities simultaneously.
write-off criteria, the Group does not reduce r) Cash and cash equivalents
impairment allowance from the gross carrying
Cash and cash equivalents in the balance sheet
amount
comprise cash at banks and on hand and short-term
- Loan commitments and financial guarantee deposits with original maturity of three months or less,
contracts: ECL is presented as a provision in which are subject to an insignificant risk of changes in
the balance sheet, i.e. as a liability value. In the statement of cash flows, cash and cash
For assessing increase in credit risk and impairment equivalents consist of cash and short term deposits, as
loss, the Group combines financial instruments defined above, net of outstanding bank overdrafts as
on the basis of shared credit risk characteristics they are considered as integral part of the Group’s cash
with the objective of facilitating an analysis that is management.
132
Corporate Overview Statutory Reports Financial Statements
is not yet committed to or significant future investments currencies of the post-employment benefit obligation with
that will enhance the asset’s performance of the CGU at least an ‘AA’ rating or above, as set by an internationally
being tested. The recoverable amount is sensitive to acknowledged rating agency, and extrapolated as
the discount rate used for the DCF model as well as the needed along the yield curve to correspond with the
expected future cash-inflows and the growth rate used expected term of the defined benefit obligation. The
for extrapolation purposes. underlying bonds are further reviewed for quality. Those
having excessive credit spreads are excluded from the
Taxes
analysis of bonds on which the discount rate is based,
Deferred tax assets are recognised for unused tax on the basis that they do not represent high quality
losses to the extent that it is probable that taxable corporate bonds.
profit will be available against which the losses can be
The mortality rate is based on publicly available mortality
utilised. Significant management judgement is required
tables for the specific countries. Those mortality
to determine the amount of deferred tax assets that can
tables tend to change only at interval in response to
be recognised, based upon the likely timing and the level
demographic changes. Future salary increases and
of future taxable profits together with future tax planning
gratuity increases are based on expected future inflation
strategies.
rates for the respective countries.
Defined benefit plans
Fair value measurement of financial instruments
The cost of the defined benefit gratuity plan and other
When the fair values of financial assets and financial
post-employment benefits and the present value of
liabilities recorded in the balance sheet cannot be
the gratuity obligation are determined using actuarial
measured based on quoted prices in active markets,
valuations. An actuarial valuation involves making various
their fair value is measured using valuation techniques
assumptions that may differ from actual developments
including the DCF model. The inputs to these models
in the future. These include the determination of the
are taken from observable markets where possible,
discount rate, future salary increases and mortality
but where this is not feasible, a degree of judgement is
rates. Due to the complexities involved in the valuation
required in establishing fair values. Judgements include
and its long-term nature, a defined benefit obligation
considerations of inputs such as liquidity risk, credit
is highly sensitive to changes in these assumptions. All
risk and volatility. Changes in assumptions about these
assumptions are reviewed at each reporting date.
factors could affect the reported fair value of financial
The parameter most subject to change is the discount instruments. See Note 38 for further disclosures.
rate. In determining the appropriate discount rate for
plans operated in India, the management considers 4 (a) Standards issued but not yet effective
the interest rates of government bonds in currencies Ministry of Corporate Affairs (“MCA”) notifies new
consistent with the currencies of the post-employment standard or amendments to the existing standards.
benefit obligation. For plans operated outside India, There is no such notification which would have been
the management considers the interest rates of high applicable from April 1, 2020.
quality corporate bonds in currencies consistent with the
134
Corporate Overview Statutory Reports Financial Statements
Net block
At March 31, 2019 26.63 14.29 1,300.30 100.81 22.85 28.86 66.44 9.85 1,570.04
At March 31, 2020 26.63 13.61 1,233.44 114.40 15.71 24.60 49.31 7.35 1,485.09
Note:-
1. The value of land has been estimated based on the stamp duty valuation rate.
2. Additions of building includes office building (including share in undivided portion of land) taken on long term lease i.e. 999
years.
3. The Group had elected to continue with the carrying value of property, plant and equipment as recognised in the financial
statements as per previous GAAP and had regarded those values as the deemed cost on the date of transition (i.e. April 1,
2015). The Group has disclosed the gross block and accumulated depreciation above, for information purpose only. The
accumulated depreciation as at April 1, 2015 is ` 228.49.
6. Intangible assets
Net block
At March 31, 2019 76.86 0.22 77.08
At March 31, 2020 99.61 0.20 99.81
1. The Group had elected to continue with the carrying value of intangible assets as recognised in the financial statements
as per previous GAAP and had regarded those values as the deemed cost on the date of transition (i.e. April 1, 2015). The
Group has disclosed the gross block and accumulated depreciation above, for information purpose only. The accumulated
depreciation as at April 1, 2015 is ` 228.49.
7. Investments in others
As at As at
March 31, 2020 March 31, 2019
Non - current investments
Investment carried at amortised cost
Investment in tax free bonds
7.35% Indian Railway Finance Corporation Limited Bonds 33.54 33.54
7.39% National Highway Authority of India Bonds 24.84 24.84
58.38 58.38
Investments at fair value through profit and loss
Investments in mutual funds (quoted)
Investments in mutual funds 273.14 237.85
273.14 237.85
Investments at fair value through OCI
Investment in other equity shares (unquoted)
4,472 (March 31, 2019: 4,472) equity shares of ` 10 each fully paid-up in Smartalyse
66.65 66.65
Technologies Private Limited
Less: Fair value changes routed through OCI (66.65) (66.65)
- -
15,927 (March 31, 2019: Nil) equity shares of USD 18.84 each fully paid-up in L7
21.80 -
Defense
21.80 -
Total non - current investments 353.32 296.23
Current investments
136
Corporate Overview Statutory Reports Financial Statements
As at As at
March 31, 2020 March 31, 2019
Loans and security deposits (unsecured, considered good) (at amortised cost)
Current
Security deposits 7.74 7.09
Total current 7.74 7.09
Loans and security deposits (unsecured, considered good) (at amortised cost)
Non - current
Security deposits 3.81 3.75
Total non - current 3.81 3.75
No loans are due from directors or other officers of the Group either severally or jointly with any other person. Nor any loans are
due from firms or private companies respectively in which any director is a partner, a director or a member.
As at As at
March 31, 2020 March 31, 2019
Current
Interest accrued
on bank balance 15.26 30.59
Total current 15.26 30.59
Non - current
Bank balances
Deposits with remaining maturity of more than twelve months 3.91 4.04
Total non - current 3.91 4.04
10. Inventories
As at As at
March 31, 2020 March 31, 2019
At lower of cost and net realisable value
Raw materials - Security software devices - Unified Threat Management (UTM) 13.35 8.75
Finished goods - Security softwares 49.05 45.19
Total 62.40 53.94
As at As at
March 31, 2020 March 31, 2019
Trade receivables 1,131.62 1,250.52
Trade receivable from related parties (refer note 35) - -
Total 1,131.62 1,250.52
* The management has evaluated credit impairment allowance based on the net outstanding position.
No trade or other receivable are due from directors or other officers of the Group either severally or jointly with any other person.
Nor any trade or other receivable are due from firms or private companies respectively in which any director is a partner, a director
or a member. Trade receivables are non interest bearing and generally on credit terms of 30 to 60 days.
As at As at
March 31, 2020 March 31, 2019
Balances with banks:
On current account 77.45 94.29
On EEFC account 3.09 2.68
Deposits with original maturity of less than three months - 28.37
Cheques on hand 19.55 3.87
Cash on hand 0.63 0.35
Total 100.72 129.56
138
Corporate Overview Statutory Reports Financial Statements
As at As at
March 31, 2020 March 31, 2019
Bank balances
Deposits with remaining maturity of less than twelve months 698.52 1,218.96
Unpaid dividend account 1.01 0.48
Total 699.53 1,219.44
Out of the total deposits, ` 1.02 (March 31, 2019: ` 0.97) are pledged against bank guarantees.
As at As at
March 31, 2020 March 31, 2019
Advance tax (net of provision for tax) 167.92 45.54
Total 167.92 45.54
As at As at
March 31, 2020 March 31, 2019
Current (unsecured, considered good)
Prepaid expenses 20.89 16.47
Balances with government authorities 0.87 1.95
Advance to suppliers 0.52 25.78
Advance to employees - 0.20
Other assets 1.85 0.34
Total current 24.13 44.74
As at As at
March 31, 2020 March 31, 2019
Authorized shares
75,000,000 (March 31, 2019: 75,000,000) equity shares of ` 10 each 750.00 750.00
750.00 750.00
Issued, subscribed and fully paid-up shares
64,203,618 (March 31, 2019: 70,563,654) equity shares of ` 10 each 642.03 705.63
Total issued, subscribed and fully paid-up share capital 642.03 705.63
140
Corporate Overview Statutory Reports Financial Statements
As at As at
March 31, 2020 March 31, 2019
(a) Retained earnings
Balance as at the beginning of the year 4,418.83 3,758.24
Add: Amount transferred from surplus balance in the statement of profit and loss 753.84 915.01
Less: Appropriations
Final equity dividend [amount per share ` 2 (March 31, 2019: ` 3)] 128.40 211.39
Tax on final dividend 26.86 43.03
Interim equity dividend [amount per share ` 4 (March 31, 2019: ` Nil)] 256.81 -
Tax on interim dividend 52.79 -
Balance as at end of the year 4,707.81 4,418.83
142
Corporate Overview Statutory Reports Financial Statements
As at As at
March 31, 2020 March 31, 2019
Total outstanding dues to micro enterprises and small enterprises 4.73 0.37
Total outstanding dues creditors other than micro enterprises and small enterprises 382.54 387.50
Total 387.27 387.87
As at As at
March 31, 2020 March 31, 2019
Other financial liabilities at amortised cost
Payables for purchases of fixed assets 8.03 33.75
Unpaid dividend 1.01 0.48
Total 9.04 34.23
As at As at
March 31, 2020 March 31, 2019
Current
Deferred revenue 23.13 21.60
Tax deducted at source payable 16.75 13.86
GST / Sales tax / VAT payable 35.01 87.19
Other liabilities (includes advances from customers, security deposit and provident
11.79 13.11
fund and other taxes)
Total 86.68 135.76
Non - current
Security deposit 19.63 19.53
Total 19.63 19.53
Total current 86.68 135.76
Total non - current 19.63 19.53
As at As at
March 31, 2020 March 31, 2019
Provision for employee benefits
Current
Provision for gratuity 1.17 13.10
Provision for leave benefits 2.77 8.12
Total 3.94 21.22
Non - current
Provision for gratuity - 18.37
Provision for leave benefits 4.62 -
Total 4.62 18.37
Total current 3.94 21.22
Total non - current 4.62 18.37
As at As at
March 31, 2020 March 31, 2019
Current tax liabilities (net of advance tax) 13.80 13.70
Total 13.80 13.70
144
Corporate Overview Statutory Reports Financial Statements
25. Details related to cost of security software devices and software products
Details of inventory
As at As at
March 31, 2020 March 31, 2019
Raw materials
Security software devices - Unified Threat Management (UTM) 13.35 8.75
13.35 8.75
Finished goods
Security software products 49.05 45.19
49.05 45.19
146
Corporate Overview Statutory Reports Financial Statements
OCI Section
Deferred tax related to items recognised in OCI during the year
Net loss/(gain) on actuarial gains and losses 3.27 (1.71)
Net loss/(gain) on FVTOCI investments - -
Income tax charged / (credited) to OCI 3.27 (1.71)
Reconciliation of tax expense and the accounting profit multiplied by India’s domestic tax rate for the year ended
March 31, 2020 March 31, 2019
Accounting profit before tax 1,013.11 1,370.19
At India's statutory income tax rate of 25.168% (March 31, 2019: 34.944%) 254.98 478.80
Adjustments of tax relating to earlier years (Current and deferred) - 21.69
CSR expenditure 2.88 2.48
Dividend income (17.09) (51.72)
Other non-deductible expenses - (4.21)
Tax impact due to change in Tax Rate 25.09 -
Enterprises tax at foreign subsidiaries 0.99 0.89
Deferred tax asset on losses and unrealised profits not recognised 2.15 4.02
At the effective income tax rate of 25.168% [March 31, 2019: 34.944%] 269.00 451.95
Income tax expense reported in the statement of profit and loss 269.00 451.95
The unused tax losses are incurred by the subsidiaries, which are not likely to generate taxable income in the foreseeable future.
The losses can be carried forward for a period as per local laws applicable to the respective subsidiaries.
Notes:
1. Subsidiaries of the group have undistributed losses, which will be available for deduction in the hands of the Holding Company
on sale of the subsidiary. An assessable temporary difference exist, but no deferred tax asset has been recognised as it is not
probable that the temporary difference will reverse in the foreseeable future.
2. An assessable temporary difference exist on unrealised profits on inventory, but no deferred tax asset has been recognised
as it is not probable that taxable profit will be available with the subsidiaries against which the temporary difference can be
utilised.
3. An assessable temporary difference exist on foreign exchange differences on translation of foreign operations, but no
deferred tax liability has been recognised as it is not probable that the temporary difference will reverse in the foreseeable
future.
4. The Group offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and
current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax
authority.
5. During the year ended March 31, 2020 and March 31, 2019, the parent company has paid dividend to its shareholders.
This has resulted in payment of Dividend Distribution Tax (‘DDT’) to the taxation authorities. The group believes that DDT
represents additional payment to taxation authority on behalf of the shareholders. Hence DDT paid is charged to equity.
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Corporate Overview Statutory Reports Financial Statements
The Group has provided following share-based payment schemes to its employees:
Particulars Details
Date of grant June 10, 2010
Date of board approval June 10, 2010
Date of shareholder’s approval June 10, 2010
Method of settlement Equity
Vesting period 4 years
Exercise period 5 years from date of vesting
Expected life (in years)
Grant I 5.85 - 7.35
Grant II 4.53 - 6.50
Grant III 3.95 - 6.50
Fair value of shares on date of grant ` 37.50 - ` 115.24
Vesting conditions Continued employment and performance
of employee as per contract
The vesting pattern of scheme is as follows:
Time period from the date of grant Cumulative percentage of share vesting
12 months 25%
24 months 50%
36 months 75%
48 months 100%
The Group has provided following share-based payment schemes to its employees
Particulars Details
Date of grant February 6, 2014
Date of board approval February 6, 2014
Date of shareholder’s approval February 6, 2014
Method of settlement Equity
Vesting period 4 years
Exercise period 5 years from date of vesting
Expected life (in years)
Grant V 3.64 – 6.50
Grant VI 3.50 – 6.50
Grant VII 3.50 – 6.51
Grant VIII 3.50 – 6.51
Grant IX 3.50 – 6.51
Grant X 3.64 – 6.64
Grant XI 3.50 – 6.51
Grant XII 3.50 - 6.76
Grant XIII 3.50 – 6.51
Grant XIV 3.50 – 6.51
Grant XV 3.50 – 6.51
Grant XVI 3.50 – 6.51
Grant XVII 3.50 – 6.50
Fair value of shares on date of grant ` 115.24 - ` 294.33
Vesting conditions Continued employment and performance
of employee as per contract
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Corporate Overview Statutory Reports Financial Statements
Manner in which the fair value of the stock option granted during the period was determined:
The weighted average fair value of stock options granted during the year was ` 147.81 (March 31, 2019: ` 66.61). The Black and
Scholes valuation model has been used for computing the weighted average fair value considering the following inputs:
As at As at
March 31, 2020 March 31, 2019
Weighted average share price (`) 147.81 226.00
Exercise price (`) 123.60 179.70
Expected volatility (%) 27% 27%
Historical volatility (%) 0% 0%
Life of the options granted (vesting and exercise period) (in years) 3.76 – 6.51 years 3.50 - 6.51 years
Average risk-free interest rate (%) 6.62% 6.62%
Dividend yield 1.21% 1.21%
The effect of share-based payment transactions on the entity’s statement of profit and loss for the period and on its financial
position:
b. Commitments
As at As at
March 31, 2020 March 31, 2019
Capital commitments:
Estimated amount of contracts remaining to be executed on capital account and
- 4.00
not provided, net of advances
Other commitments:
Commitments in relation to purchases 7.31 7.82
c. Contingent liabilities
As at As at
March 31, 2020 March 31, 2019
Claims against the Group not acknowledged as debts
Service tax [Note (i)] - 1,610.50
Total - 1,610.50
i) During the previous year ended March 31, 2019, The Parent Company had received notice of demand dated March 13, 2019,
in relation to service tax under the provisions of Finance Act, 1994 for ` 387.43 (excluding interest and penalties) covering the
period from April 1, 2016 to June 30, 2017 on supply of anti-virus software in Compact Disk. The Parent Company replied to
the notice of demand to Commissioner of Goods and Service Tax, Pune.
During the earlier years, The Parent Company have received similar notice of demands in relation to service tax under the
provisions of Finance Act, 1994 for ` 1,223.07 (excluding penalty of ` 626.97 and predeposit, if any) covering the period from
March 1, 2011 to March 31, 2016 on supply of anti-virus software in Compact Disk. The Parent Company had filed an appeal
with Customs, Excise and Service Tax Appellate Tribunal, New Delhi for the period March 1, 2011 to March 31, 2014 and with
the Customs, Excise and Service Tax Appellate Tribunal, Mumbai for the period April 1, 2014 to March 31, 2016.
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Corporate Overview Statutory Reports Financial Statements
34. Details of investments made from unutilized portion of public issue raised during the year ended
As at As at
March 31, 2020 March 31, 2019
Investments in fixed deposits of banks 572.50 993.00
Balance in current accounts 0.86 0.79
Total * 573.36 993.79
As per the objects of the offer stated in the prospectus the Total Net Proceeds received by Group by way of IPO should be
deployed during the fiscal years 2016, 2017, 2018 and 2019.
However, if the funds are not utilized within prescribed period for reasons mentioned in prospectus, then such unutilized funds can
be utilized in fiscal year 2020 or any subsequent period as may be determined by the Group.
Based on the above, the Board of Directors of Group in the board meeting dated February 13, 2019 have decided to extend the
utilization of Net Proceeds to the subsequent fiscal years upto March 31, 2021.
* includes in March 31, 2020: ` 13.85 (March 31, 2019: ` 13.85) spent by the Group from bank accounts other than the IPO account.
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Corporate Overview Statutory Reports Financial Statements
Nature of transaction Name of the related party Year ended Year ended
March 31, 2020 March 31, 2019
Kailash Katkar 1.02 0.96
Rent paid Kailash Sahebrao Katkar HUF - 0.80
Sanjay Sahebrao Katkar HUF 1.20 1.09
2.22 2.85
CSR contribution Quick Heal Foundation 22.85 14.20
Sub-total 22.85 14.20
Kailash Katkar 37.59 61.53
Sanjay Katkar 37.59 61.53
Final equity dividend declared and paid for the Anupama Katkar 9.17 15.01
financial year ended March 31, 2020 and March Chhaya Katkar 9.17 15.01
31, 2019 Rajesh Ghonasgi - 0.31
Manu Parpia - 0.11
Abhijit Jorvekar - 0.00
93.52 153.50
Kailash Katkar 75.18 -
Sanjay Katkar 75.18 -
Interim equity dividend declared and paid for the
Anupama Katkar 18.34 -
financial year ended March 31, 2020
Chhaya Katkar 18.34 -
187.04 -
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Corporate Overview Statutory Reports Financial Statements
36. Segment
The Group is engaged in providing security software solutions. The Chief Operating Decision Maker (CODM) reviews the information
pertaining to revenue of each of the target customer group (segments) as mentioned below. However, based on similarity of
activities/products, risk and reward structure, organisation structure and internal reporting systems, the Group has structured its
operations into one operating segment viz. anti-virus and as such there is no separate reportable operating segment as defined
by Ind AS 108 “Operating segments”.For management purposes, the Group reports the details of operating segments based on
the target customer groups as under :
- Retail
- Enterprise and Government
- Mobile
The Chief Operating Decision Maker (CODM) reviews the information pertaining to revenue of each of the segments as mentioned
above for the purposes of decision making with regard to allocation of resources and assessment of its performances. However,
other than revenue, no discrete financial information is available pertaining to abovementioned segments as the assets that are
used in the business are common across all the segments and hence it is not possible to identify discrete financial information for
these segments.
Total assets
As at As at
March 31, 2020 March 31, 2019
From India 6,882.18 8,446.55
From foreign countries 83.48 81.71
Total 6,965.66 8,528.26
Income received from customers located outside India is included in the revenue from foreign countries.
There is no customer who is accounting for more than 10% of the total revenue of the Group.
Disclosure of additional information pertaining to Holding Company and subsidiaries after elimination:
Share in net assets:
Name of the Company As at March 31, 2020 As at March 31, 2019
As a % of Net assets As a % of Net assets
consolidated Amount consolidated Amount
net assets net assets
Holding Company:
Quick Heal Technologies Limited 99.21% 6,389.53 99.25% 7,838.49
Foreign subsidiaries:
Quick Heal Technologies America Inc. -0.09% (5.51) -0.02% (1.31)
Quick Heal Technologies Japan K. K. 0.14% 9.23 0.30% 23.54
Quick Heal Technologies Africa Limited 0.68% 43.62 0.44% 34.56
Seqrite Technologies DMCC 0.06% 3.81 0.03% 2.31
Total 100.00% 6,440.68 100.00% 7,897.59
Share in profit and loss:
Year ended March 31, 2020 Year ended March 31, 2019
As a % of Profit / (loss) As a % of Profit / (loss)
consolidated Amount consolidated Amount
profit or loss profit or loss
Holding Company:
Quick Heal Technologies Limited 101.71% 756.87 101.57% 932.64
Foreign subsidiaries:
Quick Heal Technologies America Inc. -0.09% (0.63) -0.06% (0.54)
Quick Heal Technologies Japan K. K. -2.88% (21.40) -1.53% (14.04)
Quick Heal Technologies Africa Limited 1.01% 7.55 0.11% 0.97
Seqrite Technologies DMCC 0.23% 1.74 -0.09% (0.81)
Total 100.00% 744.12 100.00% 918.23
Financial liabilities
Trade and other payables 387.27 387.87 387.27 387.87
Other financial liabilities 9.04 34.23 9.04 34.23
Total 396.31 422.10 396.31 422.10
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Corporate Overview Statutory Reports Financial Statements
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Corporate Overview Statutory Reports Financial Statements
As per our report of even date For and on behalf of the Board of Directors of
For MSKA & Associates Quick Heal Technologies Limited
Chartered Accountants
ICAI Firm Registration Number: 105047W
Srinivasa Rao
Nitin Manohar Jumani Kailash Katkar Sanjay Katkar Nitin Kulkarni
Anasingaraju
Partner Managing Director Joint Managing Director Chief Financial Officer Company Secretary
Membership Number: 111700 & Chief Executive Officer & Chief Technical Officer
DIN: 00397191 DIN: 00397277 Regs. No. FCS-9901
Place: Pune Place: Pune Place: Pune Place: Pune Place: Pune
Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020
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Corporate Overview Statutory Reports Financial Statements
Sr. Key Audit Matter How the Key Audit Matter was addressed in our audit
No.
1 Revenue Recognition Our audit procedures in respect of this area include but are
Refer the disclosures related to Revenue recognition in Note not limited to:
23 to the accompanying Financial Statements. 1. Obtained and read contract with customers and confirmed
Revenue is recognized in accordance with Ind AS 115, our understanding of the Company’s sales process,
Revenue from the sale of security software products including design and implementation of controls and
and devices is recognised when control of the goods is tested the operating effectiveness of these controls.
transferred to the customer at an amount that reflects the 2. Read and understood the Company’s accounting policy
consideration to which the company expects to be entitled in for revenue recognition.
exchange for those goods. 3. Confirmed our understanding of the nature of security
We determined this matter to be a key audit issue as the software products sold by the Company.
application of Ind AS 115 involves certain key judgements 4. Read the customer agreements to test the terms
relating to identification of separate performance obligations, and conditions for sale of such products including
determination of basis and its appropriateness for allocation identification of performance obligations and allocation
of transaction price to the identified performance obligations; of the transaction price to such performance obligation
and recognition of such identified performance obligations based on appropriate method, as applicable.
based on timing of satisfaction (i.e. over time or point in time)
5. Discussed with management the key assumptions
underlying the Company’s assessment of cost related
to identified performance obligations and tested
mathematical accuracy of the underlying data used for
computation and calculations made by the Company
Sr. Key Audit Matter How the Key Audit Matter was addressed in our audit
No.
2 Provision for credit loss for accounts receivables We evaluated the judgement and estimation used by
Refer Note 11 of Financial statement. management in recognising the expected credit loss
provision. Our procedures included, but were not limited to
Trade receivables as on March 31, 2020 amounts to ` 1,455.55
the following:
million against which provision of ` 323.29 million was made
towards expected credit loss in the books of account. 1. Obtained understating of the Company’s policy on
assessment of impairment of trade receivables, including
We have identified provisioning for credit loss as a key
design and implementation of controls, validation of
audit matter as the calculation of credit loss provision is a
management review controls. We have tested the
complex area and requires management to make significant
operating effectiveness of these controls.
assumptions on customer payment behaviour and estimating
the level and timing of expected future cash flows. 2. Requested for and obtained independent balance
confirmations from the Company’s customers on sample
basis.
3. Tested subsequent receipts after the year-end to on
sample basis.
4. Tested ageing of trade receivables for a sample of
customer transactions.
5. Obtained management comments and recovery plans for
trade receivables outstanding for more than 180 days
6. Assessed the trade receivables impairment methodology
applied in the current year and compared the Company’s
provisioning rates against historical collection data.
3 Provision for Impairment of Investment in subsidiaries We evaluated the judgement and estimation used by
Refer Note 7 of Financial statement. management in recognising the impairment provision in case
of investment in shares. Our procedures included, but were
Investment in subsidiaries as on March 31, 2020 amounts to
not limited to the following:
` 288.79 million against which provision of ` 188.15 million
was made towards impairment in the books of account. 1. Obtained understating of the Company’s policy on
assessment of impairment of investments in shares and
We have considered this as a key audit matter due to the
the assumption used by the management, including
fact that processes and methodologies for assessing and
design and implementation of controls, validation of
determining the recoverable amount of each investments
management review controls.
are based on complex assumptions, that by their nature
imply the use of the management’s judgment, in particular 2. Tested the operating effectiveness of the controls.
with reference to identification of impairment indicators, 3. Obtained and read the valuation report provided by the
forecast of future cash flows relating to the period covered Company’s independent valuation experts, and assessed
by the Company’s strategic business plan, normalized cash the expert’s competence, capability and objectivity
flows assumed as a basis for terminal value, as well as the 4. Evaluated management’s methodology, assumptions and
long-term growth rates and discount rates applied to such estimates used in the calculations
forecasted cash flows.
5. Tested completeness, arithmetical accuracy and validity of
the data used in the calculations
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Corporate Overview Statutory Reports Financial Statements
Sr. Key Audit Matter How the Key Audit Matter was addressed in our audit
No.
4 Assessment of Covid-19 Impact Our audit procedures in respect of this area include but are
The World Health Organization announced a global not limited to:
health emergency because of a new strain of coronavirus 1. Testing the design and operating effectiveness of key
(“COVID-19”) and classified its outbreak as a pandemic on controls (including application controls) over revenue
March 11, 2020. On March 24, 2020, the Indian government recognition and provisions relating to expenses and
announced a strict 21-day lockdown across the country impairment.
to contain the spread of the virus, which has been further 2. Testing of Application controls include testing of
extended till May 31, 2020. This pandemic and response automated controls, reports and system reconciliations.
are creating disruption in global supply chain and adversely
3. Selecting samples based on quantitative and qualitative
impacting most of the industries which has resulted in global
risk factors
slowdown.
4. Testing the selected samples for cut off over revenue
The management has made an assessment of the impact
recognition
of COVID-19 on the Company’s operations, financial
performance and position as at and for the year ended March 5. Testing the selected sample to assess its correct
31, 2020 and has concluded that no there is no impact which classification and provision amount as per extant policy.
is required to be recognised in the financial statements. 6. Verified the management evaluation over assessment of
The full extent and duration of the impact of COVID-19 is Going Concern assumption and Impairment provisions.
currently unknown and the provision made by the Company
based on its estimates involves a significant amount of
judgement including the duration and spread of the pandemic
and any new information that may emerge concerning the
severity of the virus, its spread to other regions and the
actions to contain the virus or treat its impact, among others.
Hence, we have ascertained the assessment of the impact of
Covid-19 as a Key Audit Matter.
Information Other than the Standalone Financial Responsibilities of Management and Those Charged with
Statements and Auditor’s Report Thereon Governance for the Standalone Financial Statements
The Company’s Board of Directors is responsible for the other The Company’s Board of Directors is responsible for the
information. The other information comprises the information matters stated in section 134(5) of the Act with respect to the
included in the Director’s Report including Annexures to the preparation of these standalone financial statements that
Director’s Report in the Annual Report of the Company but give a true and fair view of the financial position, financial
does not include the standalone financial statements and our performance, changes in equity and cash flows of the Company
auditor’s report thereon. in accordance with the accounting principles generally
Our opinion on the standalone financial statements does not accepted in India, including the Accounting Standards
cover the other information and we do not express any form of specified under section 133 of the Act. This responsibility also
assurance conclusion thereon. includes maintenance of adequate accounting records in
accordance with the provisions of the Act for safeguarding of
In connection with our audit of the standalone financial
the assets of the Company and for preventing and detecting
statements, our responsibility is to read the other information
frauds and other irregularities; selection and application
and, in doing so, consider whether the other information is
of appropriate accounting policies; making judgments and
materially inconsistent with the standalone financial statements
estimates that are reasonable and prudent; and design,
or our knowledge obtained in the audit or otherwise appears
implementation and maintenance of adequate internal
to be materially misstated. If, based on the work we have
financial controls, that were operating effectively for ensuring
performed, we conclude that there is a material misstatement
the accuracy and completeness of the accounting records,
of this other information, we are required to report that fact.
relevant to the preparation and presentation of the standalone
We have nothing to report in this regard.
financial statement that give a true and fair view and are free
from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, the Board of Statement of Cash Flow dealt with by this Report are
Directors is responsible for assessing the Company’s ability to in agreement with the books of account.
continue as a going concern, disclosing, as applicable, matters (d) In our opinion, the aforesaid standalone financial
related to going concern and using the going concern basis statements comply with the Accounting Standards
of accounting unless the Board of Directors either intends specified under Section 133 of the Act, read with
to liquidate the Company or to cease operations, or has no Rule 7 of the Companies (Accounts) Rules, 2014.
realistic alternative but to do so.
(e) On the basis of the written representations received
Those Board of Directors are also responsible for overseeing from the directors as on March 31, 2020 taken
the Company’s financial reporting process. on record by the Board of Directors, none of the
directors is disqualified as on March 31, 2020 from
Auditor’s Responsibilities for the Audit of the Standalone
being appointed as a director in terms of Section
Financial Statements
164 (2) of the Act.
Our objectives are to obtain reasonable assurance about
whether the standalone financial statements as a whole (f) With respect to the adequacy of the internal financial
are free from material misstatement, whether due to fraud controls with reference to standalone financial
or error, and to issue an auditor’s report that includes our statements of the Company and the operating
opinion. Reasonable assurance is a high level of assurance, effectiveness of such controls, refer to our separate
but is not a guarantee that an audit conducted in accordance Report in “Annexure C”.
with SAs will always detect a material misstatement when it (g) With respect to the other matters to be included in
exists. Misstatements can arise from fraud or error and are the Auditor’s Report in accordance with Rule 11 of
considered material if, individually or in the aggregate, they the Companies (Audit and Auditors) Rules, 2014, in
could reasonably be expected to influence the economic our opinion and to the best of our information and
decisions of users taken on the basis of these standalone according to the explanations given to us:
financial statements. i. The Company has disclosed the impact of
We give in “Annexure A” a detailed description of Auditor’s pending litigations on its financial position in
responsibilities for Audit of the Standalone Financial its standalone financial statements – Refer
Statements. Note 33(c) &(d) to the standalone financial
statements;
Other Matter
ii. The Company did not have any long-term
(a) The standalone Ind AS financial statements of the
contracts including derivative contracts for
Company for the year ended March 31, 2019, were
which there were any material foreseeable
audited by another auditor whose report dated May
losses.
10, 2019 expressed an unmodified opinion on those
statements. iii. There has been no delay in transferring
amounts, required to be transferred, to the
Our opinion is not modified in respect of these matters.
Investor Education and Protection Fund by the
Report on Other Legal and Regulatory Requirements Company
1. As required by the Companies (Auditor’s Report) Order, 3. As required by The Companies (Amendment) Act, 2017,
2016 (“the Order”), issued by the Central Government in our opinion, according to information, explanations
of India in terms of sub-section (11) of section 143 of the given to us, the remuneration paid by the Company to its
Act, we give in “Annexure B” a statement on the matters directors is within the limits laid prescribed under Section
specified in paragraphs 3 and 4 of the Order, to the 197 of the Act and the rules thereunder.
extent applicable.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and
explanations which to the best of our knowledge For MSKA & Associates
and belief were necessary for the purposes of our Chartered Accountants
audit. ICAI Firm Registration No. 105047W
(b) In our opinion, proper books of account as required
by law have been kept by the Company so far as it Nitin Manohar Jumani
appears from our examination of those books. Partner
(c) The Balance Sheet, the Statement of Profit and Place: Pune Membership No. 111700
Loss, the Statement of Changes in Equity and the Date: May 21, 2020 UDIN: 20111700AAAAAZ7236
166
Corporate Overview Statutory Reports Financial Statements
Auditor’s Responsibilities for the Audit of the Financial in the financial statements or, if such disclosures are
Statements inadequate, to modify our opinion. Our conclusions are
As part of an audit in accordance with SAs, we exercise based on the audit evidence obtained up to the date of
professional judgment and maintain professional skepticism our auditor’s report. However, future events or conditions
throughout the audit. We also: may cause the Company to cease to continue as a going
• Identify and assess the risks of material misstatement of concern.
the financial statements, whether due to fraud or error, • Evaluate the overall presentation, structure and content
design and perform audit procedures responsive to of the financial statements, including the disclosures,
those risks, and obtain audit evidence that is sufficient and whether the financial statements represent the
and appropriate to provide a basis for our opinion. The underlying transactions and events in a manner that
risk of not detecting a material misstatement resulting achieves fair presentation.
from fraud is higher than for one resulting from error, We communicate with those charged with governance
as fraud may involve collusion, forgery, intentional regarding, among other matters, the planned scope and
omissions, misrepresentations, or the override of internal timing of the audit and significant audit findings, including
control. any significant deficiencies in internal control that we identify
• Obtain an understanding of internal control relevant to during our audit.
the audit in order to design audit procedures that are We also provide those charged with governance with a
appropriate in the circumstances. Under section 143(3)(i) statement that we have complied with relevant ethical
of the Act, we are also responsible for expressing our requirements regarding independence, and to communicate
opinion on whether the company has internal financial with them all relationships and other matters that may
controls with reference to financial statements in place reasonably be thought to bear on our independence, and
and the operating effectiveness of such controls. where applicable, related safeguards.
• Evaluate the appropriateness of accounting policies From the matters communicated with those charged with
used and the reasonableness of accounting estimates governance, we determine those matters that were of most
and related disclosures made by management. significance in the audit of the financial statements of the
• Conclude on the appropriateness of management’s use current period and are therefore, the key audit matters. We
of the going concern basis of accounting and, based describe these matters in our auditor’s report unless law or
on the audit evidence obtained, whether a material regulation precludes public disclosure about the matter or
uncertainty exists related to events or conditions that when, in extremely rare circumstances, we determine that a
may cast significant doubt on the Company’s ability matter should not be communicated in our report because
to continue as a going concern. If we conclude that a the adverse consequences of doing so would reasonably
material uncertainty exists, we are required to draw be expected to outweigh the public interest benefits of such
attention in our auditor’s report to the related disclosures communication.
[Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory Requirements’ in the Independent Auditors’ Report]
i. (a) The company has maintained proper records showing full particulars including quantitative details and situation of fixed
assets (Property, Plant and Equipment).
(b) All the fixed assets (Property, Plant and Equipment) have not been physically verified by the management during the
year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the
Company and the nature of its assets. No material discrepancies were noticed on such verification.
(c) According to the information and explanations given to us and on the basis of our examination of the records of the
Company, the title deeds of immovable properties are held in the name of the Company.
ii. The inventory has been physically verified during the year by the management. In our opinion, the frequency of
verification is reasonable. No material discrepancies were noticed on verification between the physical stock and the book
records.
iii. The Company has not granted any loans, secured or unsecured to Companies, Firms, Limited Liability Partnerships (LLP) or
other parties covered in the register maintained under section 189 of the Companies Act, 2013 (‘the Act’). Accordingly, the
provisions stated in paragraph 3 (iii) (a) to (c) of the Order are not applicable to the Company.
iv. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions
of section 185 and 186 of the Act, in respect of loans, investments, guarantees and security made.
v. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits
from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the rules framed there under.
vi. We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the
Company pursuant as specified by the Central Government for the maintenance of cost records under sub-section (1) of
section 148 of the Act and we are of the opinion that prima facie the prescribed accounts and records have been made and
maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are
accurate or complete.
vii. (a) According to the information and explanations given to us and the records of the Company examined by us , in our
opinion, undisputed statutory dues including provident fund, employee’s state insurance, income-tax, sales-tax, service
tax, duty of custom, duty of excise, value added tax, goods and service tax, cess and other statutory dues have generally
been regularly deposited with the appropriate authorities though there has been a slight delay in a few cases.
(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund,
employees’ state insurance, income-tax, service tax, sales-tax, duty of custom, duty of excise, value added tax, goods
and service tax, cess and other statutory dues were outstanding, at the year end, for a period of more than six months
from the date they became payable.
(c) According to the information and explanation given to us and examination of records of the Company, the outstanding
dues of income-tax, goods and service tax, customs duty, cess and any other statutory dues on account of any dispute,
are as follows:
Name of the Nature of dues Amount Period to which Forum where dispute Remarks,
statute ` (in the amount is pending if any
Millions) relates
The Finance Service tax on supply on 285.35 FY 2014-2015 CESTAT, Mumbai
Act, 1994 licenses to end customer **
The Finance Service tax on supply on 377.01 FY 2015-2016 CESTAT, Mumbai
Act, 1994 licenses to end customer **
The Finance Service tax on supply on 371.75 FY 2016-17 Central excise and GST
Act, 1994 licenses to end customer ** Pune Commissionerate
The Finance Service tax on supply on 15.68 FY 2017-18 Central excise and GST
Act, 1994 licenses to end customer ** Pune Commissionerate
168
Corporate Overview Statutory Reports Financial Statements
Name of the Nature of dues Amount Period to which Forum where dispute Remarks,
statute ` (in the amount is pending if any
Millions) relates
Income Tax Tax on account of disallowance 7.00* FY 2013-14 Commissioner of
Act,1961 of expenses on 14A and Income Tax (Appeals)
disallowance of Depreciation
Income Tax Tax on account of disallowance 1.75* FY 2015-16 Commissioner of
Act,1961 of expenses on 14A Income Tax (Appeals)
Income Tax Tax on account of disallowance 6.17* FY 2016-17 Commissioner of
Act,1961 of expenses on 14A and Income Tax (Appeals)
disallowances of Expenses
Kerala Value Charges of suppressing the 0.31 FY 2016-17 Assistant Commissioner
Added Tax Turnover of the consignment (Appeals)
which was an intercompany
transfer.
* The amount of tax is calculated using the tax rates applicable during the relevant assessment year based on the
amount of disallowances / adjustments under dispute.
**Excludes Interest and Penalty if any thereon.
viii. The Company does not have any loans or borrowings from any financial institution, banks, government or debenture holders
during the year. Accordingly, the provision stated in paragraph 3(viii) of the Order is not applicable to the Company.
ix. The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term
loans during the year. Accordingly, the provisions stated in paragraph 3 (ix) of the Order are not applicable to the Company.
x. During the course of our audit, examination of the books and records of the Company, carried out in accordance with the
generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither
come across any instance of material fraud by the Company or on the Company by its officers or employees.
xi. According to the information and explanations given to us and based on our examination of the records of the Company,
the Company has paid/ provided for managerial remuneration in accordance with the requisite approvals mandated by the
provisions of section 197 read with Schedule V to the Act.
xii. In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly,
the provisions stated in paragraph 3(xii) of the Order are not applicable to the Company.
xiii. According to the information and explanations given to us and based on our examination of the records of the Company,
transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of
such transactions have been disclosed in the financial statements as required by the applicable accounting standards.
xiv. According to the information and explanations given to us and based on our examination of the records of the Company, the
Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures
during the year. Accordingly, the provisions stated in paragraph 3 (xiv) of the Order are not applicable to the Company.
xv. According to the information and explanations given to us and based on our examination of the records of the Company, the
Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, provisions
stated in paragraph 3(xv) of the Order are not applicable to the Company.
xvi. In our opinion, the Company is not required to be registered under section 45 IA of the Reserve Bank of India Act, 1934 and
accordingly, the provisions stated in paragraph clause 3 (xvi) of the Order are not applicable to the Company.
[Referred to in paragraph 2(f) under ‘Report on Other Legal Our audit involves performing procedures to obtain audit
and Regulatory Requirements’ in the Independent Auditors’ evidence about the internal financial controls with reference
Report] to standalone financial statements and their operating
Report on the Internal Financial Controls under Clause (i) effectiveness. Our audit of internal financial controls with
of Sub-section 3 of Section 143 of the Companies Act, 2013 reference to standalone financial statements included
(“the Act”) obtaining an understanding of internal financial controls with
reference to standalone financial statements, assessing the
We have audited the internal financial controls with reference
risk that a material weakness exists, and testing and evaluating
to standalone financial statements of Quick Heal Technologies
the design and operating effectiveness of internal control
Limited (“the Company”) as of March 31, 2020 in conjunction
based on the assessed risk. The procedures selected depend
with our audit of the standalone financial statements of the
on the auditor’s judgement, including the assessment of the
Company for the year ended on that date.
risks of material misstatement of the standalone financial
Management’s Responsibility for Internal Financial Controls statements, whether due to fraud or error.
The Company’s Management is responsible for establishing We believe that the audit evidence we have obtained is
and maintaining internal financial controls based on the internal sufficient and appropriate to provide a basis for our audit
control with reference to standalone financial statements opinion on the Company’s internal financial controls with
criteria established by the Company considering the essential reference to standalone financial statements.
components of internal control stated in the Guidance Note on
Meaning of Internal Financial Controls With Reference to
Audit of Internal Financial Controls Over Financial Reporting
Standalone Financial Statements
issued by the Institute of Chartered Accountants of India
(ICAI) (the “Guidance Note”). These responsibilities include A Company’s internal financial control with reference to
the design, implementation and maintenance of adequate standalone financial statements is a process designed to
internal financial controls that were operating effectively for provide reasonable assurance regarding the reliability of
ensuring the orderly and efficient conduct of its business, financial reporting and the preparation of standalone financial
including adherence to Company’s policies, the safeguarding statements for external purposes in accordance with generally
of its assets, the prevention and detection of frauds and errors, accepted accounting principles. A Company’s internal financial
the accuracy and completeness of the accounting records, control with reference to standalone financial statements
and the timely preparation of reliable financial information, as includes those policies and procedures that (1) pertain to the
required under the Act. maintenance of records that, in reasonable detail, accurately
and fairly reflect the transactions and dispositions of the
Auditors’ Responsibility
assets of the company; (2) provide reasonable assurance that
Our responsibility is to express an opinion on the Company’s transactions are recorded as necessary to permit preparation
internal financial controls with reference to standalone financial of standalone financial statements in accordance with
statements based on our audit. We conducted our audit in generally accepted accounting principles, and that receipts
accordance with the Guidance Note and the Standards on and expenditures of the company are being made only in
Auditing, issued by ICAI and deemed to be prescribed under accordance with authorizations of management and directors
section 143(10) of the Act, to the extent applicable to an audit of of the company; and (3) provide reasonable assurance
internal financial controls. Those Standards and the Guidance regarding prevention or timely detection of unauthorized
Note require that we comply with ethical requirements and acquisition, use, or disposition of the company’s assets that
plan and perform the audit to obtain reasonable assurance could have a material effect on the standalone financial
about whether internal financial controls with reference statements.
to standalone financial statements was established and
maintained and if such controls operated effectively in all
material respects.
170
Corporate Overview Statutory Reports Financial Statements
Notes As at As at
March 31, 2020 March 31, 2019
Assets
Non-current assets
(a) Property, plant and equipment 5 1,484.82 1,569.69
(b) Capital work-in-progress 34.00 106.33
(c) Intangible assets 6 99.61 76.86
(d) Investments in subsidiaries 7 100.64 110.30
(e) Financial assets
(i) Investments 7 353.32 296.23
(ii) Loans and security deposits 8 3.81 3.75
(iii) Other financial assets 9 3.91 4.04
(f) Deferred tax assets (net) 29 25.86 86.69
(g) Income tax assets (net) 14 167.92 45.54
(h) Other non-current assets 15 5.32 0.52
2,279.21 2,299.95
Current assets
(a) Inventories 10 62.19 41.41
(b) Financial assets
(i) Investments 7 2,745.22 3,602.17
(ii) Trade receivables 11 1,132.26 1,248.55
(iii) Cash and cash equivalents 12 35.57 79.63
(iv) Bank balances other than (iii) above 13 699.53 1,219.44
(v) Loans and security deposits 8 7.08 6.43
(vi) Interest accrued 9 15.30 30.60
(c) Other current assets 15 23.42 43.34
4,720.57 6,271.57
Total Assets 6,999.78 8,571.52
Equity and liabilities
Equity
(a) Equity share capital 16 642.03 705.63
(b) Share application money pending allotment 17 - 0.17
(c) Other equity 17
(i) Retained earnings 4,747.59 4,466.33
(ii) Securities premium 593.84 2,343.38
(iii) Amalgamation reserve 26.45 26.45
(iv) General reserve 450.26 450.26
(v) Capital redemption reserve 63.64 -
(vi) Other reserves (41.68) (43.30)
Total equity 6,482.13 7,948.92
Liabilities
Non-current liabilities
(a) Net employee defined benefit liabilities 21 4.62 18.37
(b) Other non-current liabilities 20 19.63 19.53
24.25 37.90
Current liabilities
(a) Financial liabilities
(i) Trade payables
(a) Total outstanding dues of micro enterprises and small enterprises 18 4.73 0.37
(b) Total outstanding dues creditors other than micro enterprises and
18 378.87 384.46
small enterprises
(ii) Other financial liabilities 19 9.04 34.23
(b) Other current liabilities 20 83.79 131.49
(c) Net employee defined benefit liabilities 21 3.94 21.12
(d) Income tax liabilities (net) 22 13.03 13.03
493.40 584.70
Total liabilities 517.65 622.60
Total equity and liabilities 6,999.78 8,571.52
Summary of significant accounting policies 3
The accompanying notes form an integral part of the financial statements.
As per our report of even date For and on behalf of the Board of Directors of
For MSKA & Associates Quick Heal Technologies Limited
Chartered Accountants
ICAI Firm Registration Number: 105047W
Srinivasa Rao
Nitin Manohar Jumani Kailash Katkar Sanjay Katkar Nitin Kulkarni
Anasingaraju
Partner Managing Director Joint Managing Director Chief Financial Officer Company Secretary
Membership Number: 111700 & Chief Executive Officer & Chief Technical Officer
DIN: 00397191 DIN: 00397277 Regs. No. FCS-9901
Place: Pune Place: Pune Place: Pune Place: Pune Place: Pune
Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020
172
Corporate Overview Statutory Reports Financial Statements
As per our report of even date For and on behalf of the Board of Directors of
For MSKA & Associates Quick Heal Technologies Limited
Chartered Accountants
ICAI Firm Registration Number: 105047W
Srinivasa Rao
Nitin Manohar Jumani Kailash Katkar Sanjay Katkar Nitin Kulkarni
Anasingaraju
Partner Managing Director Joint Managing Director Chief Financial Officer Company Secretary
Membership Number: 111700 & Chief Executive Officer & Chief Technical Officer
DIN: 00397191 DIN: 00397277 Regs. No. FCS-9901
Place: Pune Place: Pune Place: Pune Place: Pune Place: Pune
Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020
174
Corporate Overview Statutory Reports Financial Statements
As per our report of even date For and on behalf of the Board of Directors of
For MSKA & Associates Quick Heal Technologies Limited
Chartered Accountants
ICAI Firm Registration Number: 105047W
Srinivasa Rao
Nitin Manohar Jumani Kailash Katkar Sanjay Katkar Nitin Kulkarni
Anasingaraju
Partner Managing Director Joint Managing Director Chief Financial Officer Company Secretary
Membership Number: 111700 & Chief Executive Officer & Chief Technical Officer
DIN: 00397191 DIN: 00397277 Regs. No. FCS-9901
Place: Pune Place: Pune Place: Pune Place: Pune Place: Pune
Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020
176
Corporate Overview Statutory Reports Financial Statements
gain or loss on the change in fair value of the item (i.e., For assets and liabilities that are recognised in the
translation differences on items whose fair value gain or standalone financial statements on a recurring basis,
loss is recognised in OCI or statement of profit and loss the Company determines whether transfers have
are also recognised in OCI or statement of profit and occurred between levels in the hierarchy by re-assessing
loss, respectively). categorisation (based on the lowest level input that is
significant to the fair value measurement as a whole) at
c) Fair value measurement
the end of each reporting period.
The Company measures financial instruments such
For the purpose of fair value disclosures, the Company
as investments in equity shares (other than those in
has determined classes of assets and liabilities on the
subsidiaries) at fair value at each balance sheet date.
basis of the nature, characteristics and risks of the asset
Fair value is the price that would be received to sell an or liability and the level of the fair value hierarchy, as
asset or paid to transfer a liability in an orderly transaction explained above.
between market participants at the measurement date.
This note summarises accounting policy for fair value.
The fair value measurement is based on the presumption
Other fair value related disclosures are given in the
that the transaction to sell the asset or transfer the liability
relevant notes.
takes place either:
• Significant accounting judgements, estimates and
• In the principal market for the asset or liability, or
assumptions (refer note 4)
• In the absence of a principal market, in the most
• Quantitative disclosures of fair value measurement
advantageous market for the asset or liability.
hierarchy (refer note 41 and 42)
The principal or the most advantageous market must be
• Financial instruments risk management objectives
accessible by the Company.
and policies (refer note 43)
The fair value of an asset or a liability is measured using
the assumptions that market participants would use d) Revenue recognition
when pricing the asset or liability, assuming that market Revenue is recognized upon transfer of control of
participants act in their economic best interest. promised products or services to customers in an amount
A fair value measurement of a non-financial asset takes that reflects the consideration expected to be received in
into account a market participant’s ability to generate exchange for those products or services.
economic benefits by using the asset in its highest and Goods and Services Tax (GST) and other applicable taxes
best use or by selling it to another market participant that is not received by the Company on its own account.
would use the asset in its highest and best use. Rather, it is tax collected on value added to the commodity
The Company uses valuation techniques that are by the seller on behalf of the government and, therefore,
appropriate in the circumstances and for which sufficient these are not economic benefits flowing to the Company.
data are available to measure fair value, maximising the Accordingly, it is excluded from revenue. The following
use of relevant observable inputs and minimising the use specific recognition criteria must also be met before
of unobservable inputs. revenue is recognized:
All assets and liabilities for which fair value is measured (i) Sale of security software products and devices:
or disclosed in the standalone financial statements are Revenue from the sale of security software products
categorised within the fair value hierarchy, described as and devices (goods) is recognised when control of
follows, based on the lowest level input that is significant the goods are transferred to the customer at an
to the fair value measurement as a whole: amount that reflects the consideration to which
Level 1 - Quoted (unadjusted) market prices in active the company expects to be entitled in exchange
markets for identical assets or liabilities; for those goods. Revenue from the sale of goods
Level 2 - Valuation techniques for which the lowest level is measured at the fair value of the consideration
input that is significant to the fair value measurement is received or receivable, net of returns and
directly or indirectly observable; allowances, trade discounts and volume rebates.
Level 3 - Valuation techniques for which the lowest level In arrangements for sale of security software, the
input that is significant to the fair value measurement is Company has applied the guidance in Ind AS 115,
unobservable. Revenue, by applying the revenue recognition
178
Corporate Overview Statutory Reports Financial Statements
criteria for each separately identifiable component (iii) Revenue from software services:
of a single transaction. The arrangements generally The Company has applied the principal under Ind
meet the criteria for considering sale of security AS 115 to identify each performance obligation on
software and related services as separately licenses sold to customer. Revenue for identified
identifiable components. For allocating the performance obligation is recognised over the
consideration, the Company has measured the period of time, when such performance obligation
revenue in respect of each separable component is rendered. In absence of standalone selling price
of a transaction at its fair value, in accordance of the performance obligation, the contract price
with principles given in Ind AS 115. The Company are allocated to each performance obligation of the
allocates and defers revenue for the undelivered contract on the basis of cost plus margin approach.
items based on the fair value of the undelivered
e) Other income
elements.
(i) Interest
Contract balances:
Interest income is accrued on a time basis, by
Contract assets
reference to the principal outstanding and at the
A contract asset is the right to consideration in
effective interest rate (‘EIR’) applicable. The EIR is
exchange for goods or services transferred to the
the rate that exactly discounts the estimated future
customer. If the Company performs by transferring
cash receipts over the expected life of the financial
goods or services to a customer before the
instrument or a shorter period, where appropriate,
customer pays consideration or before payment is
to the net carrying amount of the financial asset.
due, a contract asset is recognised for the earned
When calculating the EIR, the Company estimates
consideration that is conditional.
the expected cash flows by considering all the
Trade receivables contractual terms of the financial instrument but
A receivable represents the Company’s right to an does not consider the expected credit losses.
amount of consideration that is unconditional (i.e., Interest income is included under the head “Other
only the passage of time is required before payment income” in the statement of profit and loss.
of the consideration is due). Refer to accounting (ii) Dividends
policies of financial assets in section (p) Financial
Income from dividend on investments is accrued
instruments – initial recognition and subsequent
in the year in which it is declared, whereby the
measurement.
Company’s right to receive is established. Dividend
Contract liabilities income is included under the head “Other income”
A contract liability is the obligation to transfer in the statement of profit and loss.
goods or services to a customer for which the f) Taxes
Company has received consideration (or an amount
Current income tax
of consideration is due) from the customer. If a
customer pays consideration before the Company Current income tax assets and liabilities are measured
transfers goods or services to the customer, a at the amount expected to be recovered from or paid to
contract liability is recognised when the payment is the taxation authorities. The tax rates and tax laws used
made or the payment is due (whichever is earlier). to compute the amount are those that are enacted or
Contract liabilities are recognised as revenue when substantively enacted at the reporting date.
the Company performs under the contract. Current income tax relating to items recognised outside
profit or loss is recognised outside profit or loss (either
(ii) Income from services:
in OCI or in equity). Current tax items are recognised in
Revenues from support services are recognized
correlation to the underlying transaction either in OCI or
as and when services are rendered. The Company
directly in equity. Management periodically evaluates
collects GST on behalf of the government and,
positions taken in the tax returns with respect to
therefore, it is not an economic benefit flowing to
situations in which applicable tax regulations are subject
the Company. Hence, it is excluded from revenue.
to interpretation and establishes provisions where
appropriate.
180
Corporate Overview Statutory Reports Financial Statements
An item of property, plant and equipment is derecognised the net disposal proceeds and the carrying amount of the
upon disposal or when no future economic benefits asset and are recognised in the statement of profit and
are expected from its use or disposal. Any gain or loss loss when the asset is derecognised.
arising on derecognition of the asset (calculated as the
Research and development costs
difference between the net disposal proceeds and the
carrying amount of the asset) is included in the statement Research costs are expensed as incurred. Development
of profit and loss when the asset is derecognised. expenditure incurred on an individual project is
recognized as an intangible asset when the Company
The residual values, useful lives and methods of
can demonstrate all the following:
depreciation of property, plant and equipment are
reviewed at each financial year end and adjusted • The technical feasibility of completing the intangible
prospectively, if appropriate. asset so that it will be available for use or sale;
• Its intention to complete the asset;
h) Intangible assets
• Its ability and intention to use or sell the asset;
Intangible assets acquired separately are measured on
initial recognition at cost. Following initial recognition, • How the asset will generate future economic
intangible assets are carried at cost less accumulated benefits;
amortisation and accumulated impairment losses, if • The availability of adequate resources to complete
any. Internally generated intangible assets, excluding the development and to use or sell the asset; and
capitalised development costs, are not capitalised • The ability to measure reliably the expenditure
and the expenditure is recognised in the statement of attributable to the intangible asset during
profit and loss in the period in which the expenditure is development.
incurred. Following the initial recognition of the development
The useful lives of intangible assets are assessed as expenditure as an asset, the cost model is applied
either finite or indefinite. requiring the asset to be carried at cost less any
Intangible assets with finite useful lives i.e. softwares accumulated amortization and accumulated impairment
are amortized on a straight line basis over the period of losses. Amortization of the asset begins when
expected future benefits i.e. over their estimated useful development is complete and the asset is available for
lives of three years. Intangible assets are assessed for use. It is amortized on a straight line basis over the period
impairment whenever there is an indication that the of expected future benefit from the related project, i.e.,
intangible asset may be impaired. the estimated useful life. Amortization is recognized in
The amortisation period and the amortisation method for the statement of profit and loss. During the period of
an intangible asset with a finite useful life are reviewed development, the asset is tested for impairment annually.
at least at the end of each reporting period. Changes i) Leases
in the expected useful life or the expected pattern of Effective April 01, 2019, the Company adopted IND AS
consumption of future economic benefits embodied in 116 “Leases” under the modified retrospective approach
the asset is accounted for by changing the amortisation without restatement of comparatives. The Company
period or method, as appropriate, and are treated as elected to apply the practical expedient to not reassess
changes in accounting estimates. The amortisation whether a contract is or contains a lease at the date
expense on intangible assets with finite lives is of initial application. Contracts entered into before the
recognised in the statement of profit and loss. transition date that were not identified as leases under
Intangible assets with indefinite useful lives are not IND AS 17 were not reassessed. The definition of a lease
amortised, but are tested for impairment annually, under IND AS 116 was applied only to contracts entered
either individually or at the cash-generating unit level. into or changed on or after April 01, 2019
The assessment of indefinite life is reviewed annually As a lessee, the Company previously classified leases
to determine whether the indefinite life continues to as operating or finance leases based on its assessment
be supportable. If not, the change in useful life from of whether the lease transferred substantially all of the
indefinite to finite is made on a prospective basis. risks and rewards of ownership. Under IND AS 116, the
Gains or losses arising from derecognition of an Company recognizes right-of-use assets and lease
intangible asset are measured as the difference between liabilities for most leases.
All leases are accounted for by recognising a right-of-use applied on lease commencement. The carrying value
asset and a lease liability except for: of lease liabilities is similarly revised when the variable
• Leases of low value assets; and element of future lease payments dependent on a rate or
index is revised. In both cases an equivalent adjustment
• Leases with a duration of 12 months or less
is made to the carrying value of the right-of-use asset,
Lease liabilities are measured at the present value of the with the revised carrying amount being amortised over
contractual payments due to the lessor over the lease the remaining (revised) lease term.
term, with the discount rate determined by reference to
the rate inherent in the lease unless this is not readily j) Inventories
determinable, in which case the entities incremental Inventories are valued at the lower of cost and net
borrowing rate on commencement of the lease is realisable value.
used. Variable lease payments are only included in the Cost of inventories have been computed to include all
measurement of the lease liability if they depend on cost of purchases, cost of conversion and other costs
an index or rate. In such cases, the initial measurement incurred in bringing the inventories to their present
of the lease liability assumes the variable element will location and condition.
remain unchanged throughout the lease term. Other
• Raw materials are valued at lower of cost and net
variable lease payments are expensed in the period to
realizable value. However, materials and other
which they relate.
items held for use in the production of inventories is
On initial recognition, the carrying value of the lease not written down below cost of the finished product
liability also includes: in which they will be incorporated are expected to
• amounts expected to be payable under any residual be sold at or above cost. Cost of raw material is
value guarantee; determined on a weighted average basis.
• the exercise price of any purchase option granted in • Finished goods are valued at lower of cost and net
favour of the Company if it is reasonable certain to realizable value. Cost includes direct material and
assess option; labour and a proportion of manufacturing overhead
• any penalties payable for terminating the lease, if based on normal operating capacity. Cost is
the term of the lease has been estimated on the determined on a weighted average basis.
basis of termination option being exercised. • Traded goods are valued at lower of cost and net
Right of use assets are initially measured at the amount realizable value. Cost included cost of purchase and
of the lease liability, reduced for any lease incentives other costs incurred in bringing the inventories to
received, and increased for: present location and condition. Cost is determined
on weighted average basis.
• lease payments made at or before commencement
of the lease; Net realizable value is the estimated selling price in the
ordinary course of business, less estimated costs of
• initial direct costs incurred; and
completion and estimated costs necessary to make the
• the amount of any provision recognised where the sale.
Company is contractually required to dismantle,
remove or restore the leased asset k) Impairment of non-financial assets
Subsequent to initial measurement lease liabilities The Company assesses at each reporting date whether
increase as a result of interest charged at a constant rate there is an indication that an asset may be impaired. If
on the balance outstanding and are reduced for lease any indication exists, or when annual impairment testing
payments made. Right-of-use assets are amortised on a for an asset is required, the Company estimates the
straight-line basis over the remaining term of the lease asset’s recoverable amount. An asset’s recoverable
or over the remaining economic life of the asset if, rarely, amount is the higher of an asset’s or cash-generating
this is judged to be shorter than the lease term. unit’s (CGU) fair value less costs to sell and its value in
use. It is determined for an individual asset, unless the
When the Company revises its estimate of the term of
asset does not generate cash inflows that are largely
any lease, it adjusts the carrying amount of the lease
independent of those from other assets of the Company.
liability to reflect the payments to make over the revised
When the carrying amount of an asset or CGU exceeds
term, which are discounted at the same discount rate that
182
Corporate Overview Statutory Reports Financial Statements
its recoverable amount, the asset is considered impaired benefits will be required to settle the obligation, and
and is written down to its recoverable amount. a reliable estimate can be made of the amount of the
In assessing value in use, the estimated future cash flows obligation.
are discounted to their present value using a pre-tax When the Company expects some or all of a provision to
discount rate that reflects current market assessments be reimbursed, for example, under an insurance contract,
of the time value of money and the risks specific to the reimbursement is recognised as a separate asset,
the asset. In determining fair value less costs to sell, but only when the reimbursement is virtually certain.
recent market transactions are taken into account, if The expense relating to a provision is presented in the
available. If no such transactions can be identified, an statement of profit and loss net of any reimbursement.
appropriate valuation model is used. These calculations If the effect of the time value of money is material,
are corroborated by valuation multiples, quoted share provisions are discounted using a current pre-tax rate
prices for publicly traded subsidiaries or other available that reflects, when appropriate, the risks specific to the
fair value indicators. liability. When discounting is used, the increase in the
The Company bases its impairment calculation on provision due to the passage of time is recognised as a
detailed budgets and forecasts which are prepared finance cost.
separately for each of the Company’s CGU to which m) Contingent liabilities
the individual assets are allocated. These budgets and
A contingent liability is a possible obligation that arises
forecast calculations are generally covering a period of
from past events whose existence will be confirmed
five years. For longer periods, a long-term growth rate is
by the occurrence or non-occurrence of one or more
calculated and applied to project future cash flows after
uncertain future events beyond the control of the
the fifth year. Company or a present obligation that is not recognized
Impairment losses, including impairment on inventories, because it is not probable that an outflow of resources
are recognised in the statement of profit and loss in will be required to settle the obligation. A contingent
those expense categories consistent with the function of liability also arises in extremely rare cases where there
the impaired asset. is a liability that cannot be recognized because it cannot
For assets excluding goodwill, an assessment is made be measured reliably. The Company does not recognize
at each reporting date as to whether there is any a contingent liability but discloses its existence in the
indication that previously recognised impairment losses standalone financial statements.
may no longer exist or may have decreased. If such n) Retirement and other employee benefits
indication exists, the Company estimates the asset’s or
a) Short-term employee benefits
CGU’s recoverable amount. A previously recognised
impairment loss is reversed only if there has been a The distinction between short term and long term
change in the assumptions used to determine the asset’s employee benefits is based on expected timing of
recoverable amount since the last impairment loss was settlement rather than the employee’s entitlement
recognised. The reversal is limited so that the carrying benefits. All employee benefits payable within twelve
amount of the asset does not exceed its recoverable months of rendering the service are classified as
amount, nor exceed the carrying amount that would have short term benefits. Such benefits include salaries,
been determined, net of depreciation, had no impairment wages, bonus, short term compensated absences,
loss been recognised for the asset in prior years. Such awards, ex-gratia, performance pay, etc. and are
reversal is recognised in the statement of profit and loss. recognised in the period in which the employee
renders the related service.
Intangible assets with indefinite useful lives are tested
for impairment annually either individually or at the CGU b) Post-employment benefits
level, as appropriate and when circumstances indicate (i) Defined contribution plan
that the carrying value may be impaired.
The Company makes payment to provident
l) Provisions fund scheme which is defined contribution
A provision is recognized when the Company has a plan. The contribution paid/payable under
present obligation as a result of past event; it is probable the schemes is recognised in the statement
that an outflow of resources embodying economic of profit and loss during the period in which
the employee renders the related service. Net interest is calculated by applying the
The Company has no further obligations discount rate to the net defined benefit
under these schemes beyond its periodic liability or asset. The Company recognises the
contributions. following changes in the net defined benefit
The Company recognize contribution obligation as an expense in the statement of
payable to the provident fund scheme as an profit and loss:
expenditure, when an employee renders the • Service costs comprising current service
related services. If the contribution payable costs, past-service costs, gains and
to the scheme for services received before losses on curtailments and non-routine
balance sheet date exceeds the contribution settlements; and
already paid, the deficit payable to the scheme
• Net interest expense or income.
is recognized as a liability after deducting the
contribution already paid. If the contribution c) Other long-term employment benefits:
already paid exceeds the contribution due for The Company treats accumulated leave expected
services received before the balance sheet to be carried forward beyond twelve months, as
date, then the excess recognized as an asset long-term employee benefit for measurement
to the extent that the pre-payment will lead to, purposes. Such long-term compensated absences
for example, a reduction in future payment or are provided for based on the actuarial valuation
cash refund. using the projected unit credit method at the year
(ii) Defined benefit plan end. Actuarial gains/losses are immediately taken
to the statement of profit and loss and are not
The Company operates a defined benefit plan
deferred. The Company presents the leave as a
for its employees, viz. gratuity. The present
current liability in the Balance Sheet to the extent
value of the obligation under such defined
it does not have an unconditional right to defer its
benefit plans is determined based on the
settlement for 12 months after the reporting date.
actuarial valuation using the Projected Unit
Where the Company has the unconditional legal
Credit Method as at the date of the Balance
and contractual right to defer the settlement for a
sheet. The fair value of plan asset is reduced
period beyond 12 months, the same is presented as
from the gross obligation under the defined
non-current liability.
benefit plans, to recognise the obligation on a
net basis. o) Share based payments
Re-measurements, comprising of actuarial Employees (including senior executives) of the Company
gains and losses, the effect of the asset ceiling, receive remuneration in the form of share-based
excluding amounts included in net interest on payments, whereby employees render services as
the net defined benefit liability and the return consideration for equity instruments (equity-settled
on plan assets (excluding amounts included in transactions).
net interest on the net defined benefit liability),
Equity-settled transactions
are recognised immediately in the Balance
Sheet with a corresponding debit or credit to The cost of equity-settled transactions is determined by
retained earnings through OCI in the period in the fair value at the date when the grant is made using an
which they occur. Re-measurements are not appropriate valuation model.
reclassified to the statement of profit and loss That cost is recognised, together with a corresponding
in subsequent periods. increase in share-based payment (“SBP”) reserves in
Past service costs are recognised in statement equity, over the period in which the performance and/
of profit and loss on the earlier of: or service conditions are fulfilled in employee benefits
• The date of the plan amendment or expense. The cumulative expense recognised for
curtailment; and equity-settled transactions at each reporting date until
the vesting date reflects the extent to which the vesting
• The date that the Company recognises
period has expired and the Company’s best estimate of
related restructuring costs
the number of equity instruments that will ultimately vest.
184
Corporate Overview Statutory Reports Financial Statements
The statement of profit and loss expense or credit for a - The asset is held within a business model
period represents the movement in cumulative expense whose objective is to hold assets for collecting
recognised as at the beginning and end of that period contractual cash flows, and
and is recognised in employee benefits expense. - Contractual terms of the asset give rise on
No expense is recognised for awards that do not specified dates to cash flows that are solely
ultimately vest, except for equity-settled transactions for payments of principal and interest (SPPI) on
which vesting is conditional upon a market or non-vesting the principal amount outstanding.
condition. These are treated as vesting irrespective of This category is the most relevant to the Company.
whether or not the market or non-vesting condition is After initial measurement, such financial assets are
satisfied, provided that all other performance and/or subsequently measured at amortised cost using
service conditions are satisfied. the EIR method. Amortised cost is calculated by
When the terms of an equity-settled award are modified, taking into account any discount or premium on
the minimum expense recognised is the expense had acquisition and fees or costs that are an integral
the terms had not been modified, if the original terms of part of the EIR. The EIR amortisation is included in
the award are met. An additional expense is recognised finance income in the statement of profit and loss.
for any modification that increases the total fair value of The losses arising from impairment are recognised
the share-based payment transaction, or is otherwise in the statement of profit and loss.
beneficial to the employee as measured at the date of
Debt instrument at FVTPL
modification.
FVTPL is a residual category for debt instruments.
The dilutive effect of outstanding options is reflected as
Any debt instrument, which does not meet the
additional share dilution in the computation of diluted
criteria for categorization as at amortized cost or as
earnings per share.
FVTOCI, is classified as at FVTPL.
p) Financial instruments Debt instruments included within the FVTPL
A financial instrument is any contract that gives rise to category are measured at fair value with all changes
a financial asset of one entity and a financial liability or recognized in the statement of profit and loss.
equity instrument of another entity.
Equity investments
a) Financial assets All equity investments in scope of Ind AS 109 are
Initial recognition and measurement of financial measured at fair value. Equity instruments which
assets are held for trading and contingent consideration
recognised by an acquirer in a business combination
All financial assets are recognised initially at fair value
to which Ind AS103 applies are classified as at FVTPL.
plus, in the case of financial assets not recorded at
For all other equity instruments, the Company may
fair value through profit or loss, transaction costs
make an irrevocable election to present subsequent
that are attributable to the acquisition of the financial
changes in the fair value in other comprehensive
asset.
income. The Company makes such election on an
Subsequent measurement instrument-by-instrument basis. The classification is
For purposes of subsequent measurement, financial made on initial recognition and is irrevocable.
assets are classified in the following categories: If the Company decides to classify an equity
- Debt instruments at amortised cost instrument as at FVTOCI, then all fair value changes
- Debt instruments at fair value through profit or on the instrument, excluding dividends, are
loss (FVTPL) recognized in the OCI. There is no recycling of the
amounts from OCI to statement of profit and loss,
- Equity instruments measured at fair value
even on sale of investment. However, the Company
through other comprehensive income
may transfer the cumulative gain or loss within
(FVTOCI)
equity.
Debt instruments at amortised cost Equity instruments included within the FVTPL
A ‘debt instrument’ is measured at the amortised category are measured at fair value with all changes
cost if both the following conditions are met: recognized in the statement of profit and loss.
186
Corporate Overview Statutory Reports Financial Statements
number of ordinary shares outstanding during the year. transfer a goods or service that is distinct or a series of
The earnings considered in ascertaining the Company’s distinct goods or services that are substantially the same
EPS comprise the net profit after tax attributable to and that have the same pattern of transfer to the customer
equity shareholders. The weighted average number of to identify separate performance obligation, transaction
equity shares outstanding during the year is adjusted for price is allocated to each performance obligation that
events of bonus issue, bonus element in a rights issue depicts the amount of consideration to which the entity
to existing shareholders, share split, and reverse share expects to be entitled in exchange for transferring the
split (consolidation of shares) other than the conversion promised goods or services to the customer and point
of potential equity shares that have changed the number of transfer of control in goods or service to determine
of equity shares outstanding, without a corresponding whether the performance obligation is satisfied over time
change in resources. or at a point in time.
The diluted EPS is calculated on the same basis as basic Estimates and assumptions
EPS, after adjusting for the effects of potential dilutive
The key assumptions concerning the future and other key
equity shares. There were no instruments excluded
sources of estimation uncertainty at the reporting date,
from the calculation of diluted earnings per share for the
that have a significant risk of causing a material adjustment
periods presented because of an anti-dilutive impact.
to the carrying amounts of assets and liabilities within the
u) Segment reporting next financial year, are described below. The Company
An operating segment is a component of a company based its assumptions and estimates on parameters
whose operating results are regularly reviewed by the available when the financial statements were prepared.
Company’s Chief Operating Decision Maker (CODM) to Existing circumstances and assumptions about future
make decisions about resource allocation and assess its developments, however, may change due to market
performance and for which discrete financial information changes or circumstances arising that are beyond the
is available. The Company has identified the Managing control of the Company. Such changes are reflected in
Director of the Company as its CODM. the assumptions when they occur.
188
Corporate Overview Statutory Reports Financial Statements
in the future. These include the determination of the Fair value measurement of financial instruments
discount rate, future salary increases and mortality When the fair values of financial assets and financial
rates. Due to the complexities involved in the valuation liabilities recorded in the balance sheet cannot be
and its long-term nature, a defined benefit obligation measured based on quoted prices in active markets,
is highly sensitive to changes in these assumptions. All their fair value is measured using valuation techniques
assumptions are reviewed at each reporting date. including the DCF model. The inputs to these models
The parameter most subject to change is the discount are taken from observable markets where possible,
rate. In determining the appropriate discount rate for but where this is not feasible, a degree of judgement is
plans operated in India, the management considers required in establishing fair values. Judgements include
the interest rates of government bonds in currencies considerations of inputs such as liquidity risk, credit
consistent with the currencies of the post-employment risk and volatility. Changes in assumptions about these
benefit obligation. factors could affect the reported fair value of financial
The mortality rate is based on publicly available mortality instruments. Refer note 41 for further disclosures.
tables for the specific countries. Those mortality 4 (a) Standards issued but not yet effective
tables tend to change only at interval in response to
Ministry of Corporate Affairs (“MCA”) notifies new
demographic changes. Future salary increases and
standard or amendments to the existing standards.
gratuity increases are based on expected future inflation
There is no such notification which would have been
rates for the respective countries.
applicable from April 1, 2020.
Further details about gratuity obligations are given in
note 31.
Net block
At March 31, 2019 26.63 14.29 1,300.30 100.71 22.76 28.86 66.29 9.85 1,569.69
At March 31, 2020 26.63 13.62 1,233.45 114.36 15.63 24.60 49.18 7.35 1,484.82
Note:-
1. The value of land has been estimated based on the stamp duty valuation rate
2. Additions of building includes office building (including share in undivided portion of land) taken on long term lease i.e. 999
years.
3. The Company had elected to continue with the carrying value of property, plant and equipment as recognised in the financial
statements as per previous GAAP and had regarded those values as the deemed cost on the date of transition (i.e. April 1,
2015). The Company has disclosed the gross block and accumulated depreciation above, for information purpose only. The
accumulated depreciation as at April 1, 2015 was ` 228.19.
190
Corporate Overview Statutory Reports Financial Statements
6. Intangible assets
Software Total
Cost (Gross) ( refer note 1)
At April 1, 2018 457.70 457.70
Purchase 14.78 14.78
Disposals - -
At March 31, 2019 472.48 472.48
Purchase 73.21 73.21
Disposals 75.81 75.81
At March 31, 2020 469.88 469.88
Amortisation (Gross) ( refer note 1)
At April 1, 2018 339.39 339.39
Amortisation for the year 56.23 56.23
Disposals - -
At March 31, 2019 395.62 395.62
Amortisation for the year 50.14 50.14
Disposals 75.49 75.49
At March 31, 2020 370.27 370.27
Net block
At March 31, 2019 76.86 76.86
At March 31, 2020 99.61 99.61
1. The Company had elected to continue with the carrying value of intangible assets as recognised in the financial statements
as per previous GAAP and had regarded those values as the deemed cost on the date of transition (i.e. April 1, 2015). The
Company has disclosed the gross block and accumulated amortisation above, for information purpose only. The accumulated
amortisation as at April 1, 2015 was ` 174.39.
As at As at
March 31, 2020 March 31, 2019
Non - current investments
Investment in equity shares (unquoted) (at cost)
Investment in wholly owned subsidiaries
5,000 (March 31, 2019: 4,600) equity shares of JPY 50,000 each fully paid-up in
152.73 139.22
Quick Heal Technologies Japan K.K., Japan
Less: Impairment of investment in Quick Heal Technologies Japan K.K., Japan (152.73) (129.56)
- 9.66
788,000 (March 31, 2019: 788,000) equity shares of USD 1 each fully paid-up in Quick
53.64 53.64
Heal Technologies America Inc., USA
Less: Impairment of investment in Quick Heal Technologies America Inc., USA (10.49) (10.49)
43.15 43.15
11,367,500 (March 31, 2019: 11,367,500) equity shares of KSH 10 each fully paid-up in
76.80 76.80
Quick Heal Technologies Africa Limited, Kenya
Less: Impairment of investment in Quick Heal Technologies Africa Limited, Kenya (24.93) (24.93)
51.87 51.87
As at As at
March 31, 2020 March 31, 2019
300 (March 31, 2019: 300) equity shares of AED 1,000 each fully paid-up in Seqrite
5.62 5.62
Technologies DMCC, UAE
Sub total - Investment in equity shares (unquoted) (at cost) 100.64 110.30
Investment carried at amortised cost
Investment in tax free bonds
7.35% Indian Railway Finance Corporation Limited Bonds 33.54 33.54
7.39% National Highway Authority of India Bonds 24.84 24.84
58.38 58.38
Investments at fair value through profit and loss
Investments in mutual funds (quoted)
Investments in mutual funds 273.14 237.85
273.14 237.85
Investments at fair value through OCI
Investment in other equity shares (unquoted)
4,472 (March 31, 2019: 4,472) equity shares of ` 10 each fully paid-up in Smartalyse 66.65 66.65
Technologies Private Limited
Less: Fair value changes routed through OCI (66.65) (66.65)
15,927 (March 31, 2019: Nil) equity shares of USD 18.84 each fully paid-up in L7
21.80 -
Defense Limited
21.80 -
Sub total - Investments 353.32 296.23
Total non - current investments 453.96 406.53
Current investments
Investments at fair value through profit and loss
Investments in mutual funds (quoted)
Investments in mutual funds 2,745.22 3,602.17
Total current investments 2,745.22 3,602.17
192
Corporate Overview Statutory Reports Financial Statements
As at As at
March 31, 2020 March 31, 2019
Loans and security deposits (unsecured, considered good) (at amortised cost)
Current
Security deposits 7.08 6.43
Total current 7.08 6.43
Loans and security deposits (unsecured, considered good) (at amortised cost)
Non - current
Security deposits 3.81 3.75
Total non - current 3.81 3.75
No loans are due from directors or other officers of the Company either severally or jointly with any other person. Nor any loans are
due from firms or private companies respectively in which any director is a partner, a director or a member.
As at As at
March 31, 2020 March 31, 2019
Current
Interest accrued
on bank balance 15.26 30.60
Advance to subsidiaries (refer note 39 and 40) 0.04 -
Total current 15.30 30.60
Non - current
Bank balances
Deposits with remaining maturity of more than twelve months 3.91 4.04
Total non - current 3.91 4.04
10. Inventories
As at As at
March 31, 2020 March 31, 2019
At lower of cost and net realisable value
Raw materials - Security software devices (Unified Threat Management) 13.35 8.75
Finished goods - Security softwares 48.84 32.66
Total 62.19 41.41
As at As at
March 31, 2020 March 31, 2019
Trade receivables 1,119.55 1,241.25
Trade receivable from related parties (refer note 39) 12.71 7.30
Total 1,132.26 1,248.55
* The management has evaluated credit impairment allowance base on the net outstanding position
No trade or other receivable are due from directors or other officers of the Company either severally or jointly with any other
person. Nor any trade or other receivable are due from firms or private companies respectively in which any director is a partner, a
director or a member. Trade receivables are non interest bearing and generally on credit terms of 30 to 60 days.
For terms and condition relating to related party receivables, refer note 39.
As at As at
March 31, 2020 March 31, 2019
Balances with banks:
On current account 12.30 44.37
On EEFC account 3.09 2.68
Deposits with original maturity of less than three months - 28.37
Cheques on hand 19.55 3.87
Cash on hand 0.63 0.34
Total 35.57 79.63
As at As at
March 31, 2020 March 31, 2019
Bank balances
Deposits with remaining maturity of less than twelve months 698.52 1,218.96
Unpaid dividend account 1.01 0.48
Total 699.53 1,219.44
Out of the total deposits, ` 1.02 (March 31, 2019: ` 0.97) are pledged against bank guarantees.
As at As at
March 31, 2020 March 31, 2019
Advance tax (net of provision for tax) 167.92 45.54
Total 167.92 45.54
194
Corporate Overview Statutory Reports Financial Statements
As at As at
March 31, 2020 March 31, 2019
Current (unsecured, considered good)
Prepaid expenses 20.26 16.06
Balances with government authorities 0.87 1.23
Advance to suppliers 0.52 25.78
Advance to employees - 0.20
Other assets 1.77 0.07
Total current 23.42 43.34
As at As at
March 31, 2020 March 31, 2019
Authorized shares
75,000,000 (March 31, 2019: 75,000,000) equity shares of ` 10 each 750.00 750.00
750.00 750.00
Issued, subscribed and fully paid-up shares
64,203,618 (March 31, 2019: 70,563,654) equity shares of ` 10 each 642.03 705.63
Total issued, subscribed and fully paid-up share capital 642.03 705.63
(a) Reconciliation of equity shares outstanding at the beginning and at the end of the reporting year
The Board of Directors, in their meeting on May 10, 2019, proposed a final dividend of ` 2.00 per equity share and the same
was approved by the shareholders at the Annual General Meeting held on July 15, 2019. The amount was recognized as
distributions to equity shareholders during the year ended March 31, 2020 and the total appropriation was ` 155.26 including
dividend distribution tax.
The Board of Directors, in their meeting held on February 24, 2020, declared and paid an interim dividend of ` 4.00 per equity
share. The amount was recognized as distributions to equity shareholders during the year ended March 31, 2020 and the total
appropriation was ` 309.60 including dividend distribution tax.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the
Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares
held by shareholders.
(c) Shares held by holding/ ultimate holding company and /or their subsidiaries/ associates
None.
(d) Details of shareholders holding more than 5% shares in the Company
As at March 31, 2020 As at March 31, 2019
Nos. % holding Nos. % holding
Equity shares of ` 10 each fully paid-up
Kailash Katkar 1,87,94,713 29.27% 2,05,11,384 29.07%
Sanjay Katkar 1,87,94,713 29.27% 2,05,11,384 29.07%
Anupama Katkar 45,85,176 7.14% 50,03,976 7.09%
Chhaya Katkar 45,85,176 7.14% 50,03,976 7.09%
Sequoia Capital India Investment Holdings III 32,56,661 5.07% 36,65,410 5.19%
The shareholding information has been extracted from the records of the Company including register of shareholders/
members and is based on legal ownership of shares.
(e) Shares reserved for issue under option
For details of shares reserved for issue under ESOP of the Company, please refer note 32.
(f) Buyback of shares
The Board of Directors of the Company at its meeting held on March 5, 2019 and the shareholders by way of postal ballot
on April 13, 2019, approved the buy back of the Company fully paid equity shares of the face value of ` 10 each from its
shareholder/beneficial owners of equity shares of the Company including promoters and promoter group of the Company as
on the record date, on a proportionate basis through the “tender offer” route at a price of ` 275 per share for an aggregate
amount not exceeding ` 1,750 million. The Company completed the Buy Back Process in June 2019 and has complied with all
the requisite formalities with SEBI and ROC.
In accordance with section 69 of the Companies Act, 2013, during the three months ended June 30, 2019, the Company
has created ‘Capital Redemption Reserve’ of ` 63.64 million equal to the nominal value of the shares bought back as an
appropriation from Securities Premium Account.
As at As at
March 31, 2020 March 31, 2019
(a) Retained earnings
Balance as at the beginning of the year 4,466.33 3,884.34
Add: Amount transferred from surplus balance in the statement of profit and loss 746.12 836.41
Less: Appropriations
Final equity dividend [amount per share ` 2 (March 31, 2019: ` 3)] 128.40 211.39
Tax on final dividend 26.86 43.03
Interim equity dividend [amount per share ` 4 (March 31, 2019: ` Nil)] 256.81 -
Tax on interim dividend 52.79 -
Balance as at end of the year 4,747.59 4,466.33
196
Corporate Overview Statutory Reports Financial Statements
As at As at
March 31, 2020 March 31, 2019
(b) Securities premium
Balance as at the beginning of the year 2,343.38 2,327.92
Add: Additions on ESOPs exercised 0.38 12.53
Add: Transferred from ESOP account 0.08 2.93
Less: Utilised for buy back 1,686.36 -
Less: Transferred to Capital redemption reserve 63.64 -
Balance as at end of the year 593.84 2,343.38
FVTOCI reserve
The Company has elected to recognise changes in the fair value of certain investments in equity securities in other comprehensive
income. These changes are accumulated within the FVOCI equity investments reserve within equity. The Company transfers
amounts from this reserve to retained earnings when the relevant equity securities are derecognised.
As at As at
March 31, 2020 March 31, 2019
Total outstanding dues to micro enterprises and small enterprises (refer note 34) 4.73 0.37
Total outstanding dues creditors other than micro enterprises and small enterprises* 378.87 384.46
Total 383.60 384.83
* Includes amount payable to independent directors (refer note 39)
As at As at
March 31, 2020 March 31, 2019
Other financial liabilities at amortised cost
Payables for purchases of fixed assets 8.03 33.75
Unpaid dividend 1.01 0.48
Total 9.04 34.23
Total current 9.04 34.23
198
Corporate Overview Statutory Reports Financial Statements
As at As at
March 31, 2020 March 31, 2019
Current
Deferred revenue (refer note 23) 23.13 21.60
Tax deducted at source payable 16.07 13.84
GST / Vat payable 34.62 87.05
Other liabilities (includes advances from customers, security deposit and provident
9.97 9.00
fund and other taxes)
Total 83.79 131.49
Non - current
Security deposit 19.63 19.53
Total 19.63 19.53
Total current 83.79 131.49
Total non - current 19.63 19.53
Terms and conditions of the above financial and other liabilities:
- Trade payables are non-interest bearing and have an average term of 60 days.
- Payables for purchases of fixed assets are non interest bearing and have an average term of 90 days.
- Other liabilities (other than taxes and deferred revenue) are non interest bearing and have an average term of 45 days.
- Taxes such as tax deducted at source and goods and service tax / vat payable, provident fund and other taxes are non interest
bearing and are generally paid within the due date.
As at As at
March 31, 2020 March 31, 2019
Provision for employee benefits
Current
Provision for gratuity (refer note 31) 1.17 13.00
Provision for leave benefits 2.77 8.12
Total 3.94 21.12
Non - current
Provision for gratuity (refer note 31) - 18.37
Provision for leave benefits 4.62 -
Total 4.62 18.37
Total current 3.94 21.12
Total non - current 4.62 18.37
As at As at
March 31, 2020 March 31, 2019
Current tax liabilities (net of advance tax) 13.03 13.03
Total 13.03 13.03
200
Corporate Overview Statutory Reports Financial Statements
25. Details related to cost of security software devices and software products
Details of inventory
As at As at
March 31, 2020 March 31, 2019
Raw materials
Security software devices - Unified Threat Management (UTM) 13.35 8.75
13.35 8.75
Finished goods
Security software products 48.84 32.66
48.84 32.66
202
Corporate Overview Statutory Reports Financial Statements
OCI Section
Deferred tax related to items recognised in OCI during the year
Net loss/(gain) on actuarial gains and losses 3.27 (1.71)
Net loss/(gain) on FVTOCI investments - -
Income tax charged /(credit) to OCI 3.27 (1.71)
Reconciliation of tax expense and the accounting profit multiplied by India’s domestic tax rate for the year ended
March 31, 2020 March 31, 2019
Accounting profit before tax 1,004.40 1,290.70
At India's statutory income tax rate of 25.168% (March 31, 2019: 34.944%) 252.79 451.02
Adjustments of tax relating to earlier periods (Current and deferred) - 21.69
CSR expenditure 2.88 2.48
Dividend income (17.09) (51.72)
Tax impact on impairment of subsidiaries 5.83 31.80
Tax impact due to tax rate 25.09 -
Other (1.49) (4.21)
*At the effective income tax rate of 25.168% [March 31, 2019: 32.594%] 268.01 451.06
(Calculated on PBT after exceptional items)
Income tax expense reported in the statement of profit and loss 268.01 451.06
The Company offsets the tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and
current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority.
204
Corporate Overview Statutory Reports Financial Statements
As at As at
March 31, 2020 March 31, 2019
Reconciliation of net (liability) / asset:
Opening net defined benefit (liability) / asset (31.37) (27.54)
Expense charged to statement of profit and loss (17.52) (15.60)
Amount recognised in OCI 13.00 (4.94)
Contribution by employer 35.62 17.55
Mortality charges and taxes (0.90) (0.84)
Closing net defined benefit (liability) (1.17) (31.37)
Changes in the present value of the defined benefit obligation (DBO) are as follows:
Opening DBO (68.64) (57.49)
Interest cost (4.39) (3.80)
Current service cost (16.57) (14.21)
Past service cost - -
Benefits paid 11.91 12.21
Remeasurement during the period due to:
Actuarial gain / (loss) arising on account of experience changes on plan liabilities 13.11 (4.23)
Actuarial (loss) / gain arising from change in demographic assumptions 1.74 0.71
Actuarial gain / (loss) arising on account of experience changes (1.78) (1.83)
Benefits paid - -
Closing defined benefit (obligation) / asset recognised in balance sheet (64.62) (68.64)
As at As at
March 31, 2020 March 31, 2019
Changes in the fair value of plan assets:
Opening fair value of plan assets 37.27 29.94
Interest income 3.44 2.41
Contributions by employer 35.62 17.56
Mortality charges and taxes (0.90) (0.84)
Benefits paid (11.91) (12.21)
Actuarial gain / (loss) arising from change in financial assumptions on plan assets (0.20) 0.13
Actuarial gain / (loss) arising on account of experience changes on plan assets 0.13 0.28
Closing fair value of plan assets 63.45 37.27
Actual return on plan assets 3.38 2.83
206
Corporate Overview Statutory Reports Financial Statements
The principal assumptions used in determining gratuity obligations for the Company are shown below:
As at As at
March 31, 2020 March 31, 2019
Discount rate 5.50% 7.00%
Employee turnover 30.00% 22.00%
Expected rate of increment in compensation levels
- First two years 8.00% 10.00%
- Thereafter 8.00% 8.00%
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and
other relevant factors, such as supply and demand in the employment market.
The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to
the period over which the obligation is to be settled. There has been no change in expected rate of return on assets.
A quantitative sensitivity analysis for significant assumptions as at March 31, 2020 and March 31, 2019 is shown below:
As at As at
March 31, 2020 March 31, 2019
Weighted average duration of defined benefit plan obligation 4.36 years 6.14 years
The Company has provided following share-based payment schemes to its employees:
Particulars Details
Date of grant June 10, 2010
Date of board approval June 10, 2010
Date of shareholder’s approval June 10, 2010
Method of settlement Equity
Vesting period 4 years
Exercise period 5 years from date of vesting
Expected life (in years)
Grant I 5.85 - 7.35
Grant II 4.53 - 6.50
Grant III 3.95 - 6.50
Fair value of shares on date of grant ` 37.50 - ` 115.24
Vesting conditions Continued employment and performance
of employee as per contract
The vesting pattern of scheme is as follows:
Time period from the date of grant Cumulative percentage of share vesting
12 months 25%
24 months 50%
36 months 75%
48 months 100%
The details of activities under the scheme have been summarized below:
Year ended March 31, 2020 Year ended March 31, 2019
Number of Weighted average Number of Weighted average
options exercise price (`) options exercise price (`)
Outstanding at the beginning of the year 4,440 37.50 1,00,661 55.96
Granted during the year - - - -
Forfeited during the year 4,440 37.50 1,125 110.00
Exercised during the year - - 95,096 56.33
Expired during the year - - - -
Outstanding at the end of the year - - 4,440 37.50
Exercisable at the end of the year - - - 45.98
The details of exercise price for stock options outstanding at the end of the year are:
As at As at
March 31, 2020 March 31, 2019
Exercise price 37.50 – 110.00 37.50 – 110.00
Number of options outstanding (numbers) - 4,440
Weighted average remaining contractual life of options (in years) - 1.46
Weighted average exercise price 37.50 37.50
The weighted average share price at the date of exercise of these options, as at March 31, 2020 was ` Nil
The weighted average share price at the date of exercise of these options, as at March 31, 2019 was ` 273.86
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Corporate Overview Statutory Reports Financial Statements
The Company has provided following share-based payment schemes to its employees
Particulars Details
Date of grant February 6, 2014
Date of board approval February 6, 2014
Date of shareholder’s approval February 6, 2014
Method of settlement Equity
Vesting period 4 years
Exercise period 5 years from date of vesting
Expected life (in years)
Grant V 3.64 – 6.50
Grant VI 3.50 – 6.50
Grant VII 3.50 – 6.51
Grant VIII 3.50 – 6.51
Grant IX 3.50 – 6.51
Grant X 3.64 – 6.64
Grant XI 3.50 – 6.51
Grant XII 3.50 - 6.76
Grant XIII 3.50 – 6.51
Grant XIV 3.50 – 6.51
Grant XV 3.50 – 6.51
Grant XVI 3.50 – 6.51
Grant XVII 3.50 – 6.50
Fair value of shares on date of grant ` 115.24 - ` 294.33
Vesting conditions Continued employment and performance
of employee as per contract
The vesting pattern of scheme is as follows:
Time period from the date of grant Cumulative percentage of share vesting
12 months 25%
24 months 50%
36 months 75%
48 months 100%
The details of activities under the scheme have been summarized below:
Year ended March 31, 2020 Year ended March 31, 2019
Number of Weighted average Number of Weighted average
options exercise price (`) options exercise price (`)
Outstanding at the beginning of the year 7,11,227 215.99 3,96,365 175.95
Granted during the year 1,19,600 147.81 4,77,300 226.00
Forfeited during the year 2,79,100 210.69 80,563 184.84
Exercised during the year 2,100 113.57 81,875 111.14
Expired during the year - -
Outstanding at the end of the year 5,49,627 203.51 7,11,227 215.99
Exercisable at the end of the year 2,23,527 201.02 6,17,925 111.10
Manner in which the fair value of the stock option granted during the period was determined:
The weighted average fair value of stock options granted during the year was ` 147.81 (March 31, 2019: ` 66.61). The Black and
Scholes valuation model has been used for computing the weighted average fair value considering the following inputs:
As at As at
March 31, 2020 March 31, 2019
Weighted average share price (`) 147.81 226.00
Exercise price (`) 123.60 179.70
Expected volatility (%) 27% 27%
Historical volatility (%) 0% 0%
Life of the options granted (vesting and exercise period) (in years) 3.50 - 6.76 years 3.50 - 6.51 years
Average risk-free interest rate (%) 6.62% 6.62%
Dividend yield 1.21% 1.21%
The effect of share-based payment transactions on the entity’s statement of profit and loss for the period and on its financial
position:
Year ended
March 31, 2020
Lease rentals recognised during the year 13.57
Year ended
March 31, 2020
Short term leases expenses 13.57
Low value lease expenses -
Expenses relating to variable lease payments not included in the measurement of lease liabilities -
Total Lease expense 13.57
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Corporate Overview Statutory Reports Financial Statements
ii) In February 2016, one of the erstwhile distributors instituted a suit at Hon’ble High Court, Calcutta against the Company and
others claiming ₹ 16,100 for various reasons including loss of business profits, loss of capital assets & infrastructure etc. Later,
this matter was transferred to the Commercial Bench of the Hon’ble High Court in November, 2017. The matter is pending
for framing and adjudication of Preliminary issue in this matter in terms of the order passed by the Hon’ble High Court. With
respect to the above matters, the Company believes that the suit is frivolous and defending to seek the leave of the court for
its rejection/dismissal. The Company also believes that they have sufficient grounds based on the facts as well as on point of
law. Accordingly no provision in this regard has been recognised in the financial statements.
iii) One of the erstwhile vendors had filed a First information Report (FIR) in May 2016 at Uttarpara Police Station, West Bengal,
against certain directors of the Company, their wives and other associates alleging embezzlement of his investment and
misappropriation of shares. The police had filed the charge sheet. The Company, its directors and others had filed quashing
applications before Hon’ble Calcutta High Court and obtained stay on proceedings before trial Court. The Company also
believes that police have not conducted proper investigation and have neither collected nor considered relevant records,
documents, statements of witnesses and thus have sufficient and strong arguments on facts as well as on point of law.
34. Details of dues to micro and small enterprises as defined under Micro, Small and Medium
Enterprises Development Act, 2006 (MSMED Act, 2006)
212
Corporate Overview Statutory Reports Financial Statements
36. Details of investments made from unutilized portion of public issue raised during the year ended
As at As at
March 31, 2020 March 31, 2019
Investments in fixed deposits of banks 572.50 993.00
Balance in current accounts 0.86 0.79
Total * 573.36 993.79
As per the objects of the offer stated in the prospectus the Total Net Proceeds received by Company by way of IPO should be
deployed during the fiscal years 2016, 2017, 2018 and 2019.
However, if the funds are not utilized within prescribed period for reasons mentioned in prospectus, then such unutilized funds can
be utilized in fiscal year 2020 or any subsequent period as may be determined by the company.
Based on the above, the Board of Directors of Company in the board meeting dated February 13, 2019 have decided to extend the
utilization of Net Proceeds to the subsequent fiscal years upto March 31, 2021.
* includes in March 31, 2020: ` 13.85 (March 31, 2019: ` 13.85) spent by the Company from bank accounts other than the IPO account.
Year ended March 31, 2020 Year ended March 31, 2019
Yet to be Yet to be
(b) Amount spent during the year Paid Total Paid Total
paid paid
For the purpose of education and social activity 22.85 - 22.85 14.20 - 14.20
38. Particulars of unhedged foreign currency exposures as at the balance sheet date
Related parties with whom transactions have taken place during the year
Kailash Katkar, Managing Director, Chief Executive Officer and ultimate
holding shareholder
Sanjay Katkar, Joint Managing Director, Chief Technical Officer and ultimate
holding shareholder
Vijay Mhaskar, Chief Operating Officer (upto October 11, 2019)
Nitin Kulkarni, Chief Financial Officer
Srinivasa Rao Anasingaraju, Company Secretary (w.e.f. May 10, 2019)
Raghav Mulay, Company Secretary (upto January 16, 2019)
Key management personnel
Mehul Savla, Independent Director
Apurva Joshi, Independent Director
Pradeep Bhide, Independent Director (upto April 01, 2019)
Priti Rao, Independent Director (w.e.f. April 10, 2018)
Sunil Sethy, Independent Directors (upto April 24, 2018)
Shailesh Lakhani, Non-Executive Director
Manu Parpia, Independent Director (upto May 11, 2019)
Amitabha Mukhopadhyay , Independent Director (w.e.f June 10, 2019)
Anupama Katkar (wife of Kailash Katkar and ultimate holding shareholder)
Relatives of key management personnel Chhaya Katkar (wife of Sanjay Katkar and ultimate holding shareholder)
Sneha Katkar (daughter of Kailash Katkar and ultimate holding shareholder)
Kailash Sahebrao Katkar HUF
Enterprises owned by directors or major Sanjay Sahebrao Katkar HUF
shareholders Quick Heal Foundation
Dreambook Production (OPC) Private Limited
214
Corporate Overview Statutory Reports Financial Statements
Nature of transaction Name of the related party Year ended Year ended
March 31, 2020 March 31, 2019
Amitabha Mukhopadhyay 0.60 -
Apurva Joshi 0.45 0.54
Mehul Savla 0.45 0.54
Commission to independent directors
Manu Parpia - 0.54
Pradeep Bhide - 0.54
Priti Rao 0.45 0.54
Sub-total 1.95 2.70
Total 50.72 52.72
Grant Date Expiry Date * Exercise Price March 31, 2020 March 31, 2019
Number Number
outstanding outstanding
February 6, 2014 - 96.25 - -
September 6, 2014 - 110.00 - -
September 24, 2015 - 110.00 - -
November 11, 2016 - 237.40 62,500 62,500
October 10, 2018 - 185.60 25,000 -
* As per the Company policy, the option stands cancel or expire if the employee has not exercised the option within six months
from the date of resignation.
Nature of transaction Name of the related party Year ended Year ended
March 31, 2020 March 31, 2019
Kailash Katkar 1.02 0.96
Rent paid Kailash Sahebrao Katkar HUF - 0.80
Sanjay Sahebrao Katkar HUF 1.20 1.09
2.22 2.85
CSR contribution Quick Heal Foundation 22.85 14.20
Sub-total 22.85 14.20
Quick Heal Technologies 2.67 1.41
Japan K.K
Quick Heal Technologies 7.10 5.51
Sale of security software products America Inc.
Seqrite Technologies DMCC 4.60 5.20
Quick Heal Technologies 9.58 6.15
Africa Limited
23.95 18.27
Nature of transaction Name of the related party Year ended Year ended
March 31, 2020 March 31, 2019
Quick Heal Technologies 13.52 18.97
Japan K.K
Quick Heal Technologies - -
America Inc.
Investments / (Disinvestments)
Seqrite Technologies DMCC - -
Quick Heal Technologies - -
Africa Limited
13.52 18.97
Kailash Katkar 37.59 61.53
Sanjay Katkar 37.59 61.53
Final equity dividend declared and paid for the Anupama Katkar 9.17 15.01
financial year ended March 31, 2019 and March Chhaya Katkar 9.17 15.01
31, 2018 Rajesh Ghonasgi - 0.31
Manu Parpia - 0.11
Abhijit Jorvekar - 0.00
93.52 153.50
Kailash Katkar 75.18 -
Sanjay Katkar 75.18 -
Interim equity dividend declared and paid for the
Anupama Katkar 18.34 -
financial year ended March 31, 2020
Chhaya Katkar 18.34 -
187.04 -
Terms and conditions of transactions with related parties
The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm’s length transactions.
Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. The Company has not
recorded any impairment of receivables relating to amounts owed by related parties (March 31, 2019: ` Nil). This assessment is
undertaken each financial year through examining the financial position of the related party and the market in which the related
party operates.
Balance outstanding
Nature of transaction Name of the related party As at As at
March 31, 2020 March 31, 2019
Quick Heal Technologies
1.76 0.83
Japan K.K
Quick Heal Technologies
5.65 2.12
Trade receivables America Inc.
Seqrite Technologies DMCC 1.63 1.07
Quick Heal Technologies
3.67 3.28
Africa Limited
12.71 7.30
Advances receivable from subsidiaries Seqrite Technologies DMCC 0.04 -
0.04 -
Amitabha Mukhopadhyay 0.60 -
Apurva Joshi 0.45 0.54
Mehul Savla 0.45 0.54
Commission payable to independent directors
Manu Parpia - 0.54
Pradeep Bhide - 0.54
Priti Rao 0.45 0.54
1.95 2.70
216
Corporate Overview Statutory Reports Financial Statements
40. (b) Loans and advances given to subsidiaries and associates and firms / companies in which directors are interested
Advances given to wholly owned subsidiary
Quick Heal Quick Heal Quick Heal Seqrite
Technologies Technologies Technologies Technologies
Japan K.K. America Inc. Africa Limited DMCC
Balance as at March 31, 2020 - - - 0.04
Maximum amount outstanding during the financial year
0.07 - - 0.04
2019-20
Balance as at March 31, 2019 - - - -
Maximum amount outstanding during the financial year
0.01 - - 0.04
2018-19
40. (c) Exceptional items
Exceptional items includes impairment of investment in wholly owned subsidiaries amounting to ` 23.17 (March 31, 2019: `
93.17). The details are as follows:
Financial liabilities
Trade and other payables 383.60 384.83 383.60 384.83
Other financial liabilities 9.04 34.23 9.04 34.23
Total 392.64 419.06 392.64 419.06
The management assessed that the fair value of cash and cash equivalents, trade receivables, trade payables and other current
financial assets and liabilities approximate their carrying amounts largely due to the short term maturities of these instruments.
The significant unobservable inputs used in the fair value measurements categorised within Level 3 of the fair value
hierarchy, together with a quantitative sensitivity analysis as at March 31, 2020 and March 31, 2019 are as shown below:
218
Corporate Overview Statutory Reports Financial Statements
Trade receivables
Customer credit risk is managed by the Company’s established policy, procedures and control relating to customer credit risk
management. Credit quality of a customer is assessed based on an extensive credit rating scorecard and individual credit
limits are defined in accordance with this assessment. Outstanding customer receivables are regularly monitored. On account
of adoption of Ind AS 109, the Company uses expected credit loss model to assess the impairment loss or gain. The Company
follows simplified approach for recognition of impairment loss allowance on Trade receivable.
220
Corporate Overview Statutory Reports Financial Statements
As per our report of even date For and on behalf of the Board of Directors of
For MSKA & Associates Quick Heal Technologies Limited
Chartered Accountants
ICAI Firm Registration Number: 105047W
Srinivasa Rao
Nitin Manohar Jumani Kailash Katkar Sanjay Katkar Nitin Kulkarni
Anasingaraju
Partner Managing Director Joint Managing Director Chief Financial Officer Company Secretary
Membership Number: 111700 & Chief Executive Officer & Chief Technical Officer
DIN: 00397191 DIN: 00397277 Regs. No. FCS-9901
Place: Pune Place: Pune Place: Pune Place: Pune Place: Pune
Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020 Date: May 21, 2020
222
NOTES
224
EMPOWERING BUSINESSES WITH RIGHT IT SECURITY
Website: www.quickheal.co.in