Your Directors are pleased to present the Thirty-First Annual Report of your Company
along with the Audited Financial Statements for the financial year ended March 31, 2021.
Business Update
This financial year was one of your Company's strongest performance over the last
decade and one that demonstrates the unquestionable value and dedication that your Company
brings to clients every day. With the uncertainty of the pandemic front and centre, your
Company came together like no other to ensure the safety and well-being of all employees,
to maintain strong business continuity for all clients, and to contribute to global
COVID-19 relief in the markets we operate.
Through Persistent Foundation, your Company committed to donate $3.3M ($300 per
employee) to COVID-19 relief efforts globally. This funding went to various highly
regarded organizations working on the front lines to provide critical medical equipment,
PPE kits, food to affected families and more. In addition to the funding, the Foundation
logged over 5,000 volunteer hours, with more each day as the second wave bears down hard
in India.
Despite the many challenges brought on by the pandemic, your Company ended the year at
US $566.08M, representing year on year growth of 12.9%. In addition, improved operational
rigour and optimization across all units and enabling functions delivered significant
improvements in EBIT, ending 55.2% year on year. This performance and market momentum
enabled record-high stock performance, driving our market capitalization beyond $2.0B.
Your Company proudly welcomed over 3,000 new team members to support this growth,
bringing the total strength to 13,680 employees globally. This infusion of talent included
the acquisition of CAPIOT, bolstering our expertise in the fastgrowing enterprise
integration market. In addition, Persistent continues to strengthen our leadership team
for the future, including the promotion of Mr. Sandeep Kalra, previously President of TSU
to the Chief Executive Officer of your Company on October 23, 2020.
At the same time, your Company executed industry-leading delivery excellence and
customer satisfaction. Competing against 4,000 other companies in the IT industry, your
Company won the prestigious ISG 2020 Star of Excellence Award for core technologies
globally, as well as for North America, APAC, BFSI and HCLS. These coveted awards are
significant because they result from direct feedback which ISG received from over 100
Persistent clients - more than any provider.
Delivering this strong performance during such uncertain and challenging times was not
easy. Reflecting upon the year gone by, the following three key pillars were fundamental
to your Company's success:
1Resilience
Despite many pressures and unique challenges each of our employees faced during the
pandemic, they remained focused on delivering robust performance and consistent business
continuity for the Company, and more importantly, for the clients.
2Relationships
Our teams carefully listened to their clients' needs and proactively partnered with
them as they charted their path to digital acceleration providing differentiated, higher
value and outcome-based engagement models to strengthen our relationships for the long
term.
3Reinvention
With 30+ years of digital engineering DNA and deep expertise in the latest cloud
technology, your Company worked diligently with its clients to quickly reimagine, develop,
integrate, and manage the new software required to run their now fully digital business.
We will continue to put great focus on these dimensions in the coming year, as they
will no doubt be the bedrock of Persistent's growth in the future. Your Company has the
team to make it happen - it is now all about disciplined execution.
A. Financial Section
Financial Results
The highlights of the financial performance on a consolidated basis for the year ended
March 31, 2021 are as under:
|
(Amount in USD million except EPS and Book Value) |
(Amount in ^ million except EPS and Book Value) |
% Change (based on amounts in ^) |
Particulars |
2020-21 |
2019-20 |
2020-21 |
2019-20 |
|
Revenue from Operations |
566.08 |
501.61 |
41,878.88 |
35,658.08 |
17.45% |
Earnings before interest, depreciation, amortization and taxes |
92.32 |
69.34 |
6,830.15 |
4,929.54 |
38.56% |
Finance Cost* |
0.78 |
0.89 |
57.94 |
63.32 |
(8.50%) |
Depreciation and amortization |
23.73 |
23.35 |
1,755.50 |
1,659.62 |
5.78% |
Other income |
14.57 |
18.53 |
1,077.72 |
1,316.82 |
(18.16%) |
Tax expense |
21.46 |
15.76 |
1,587.66 |
1,120.53 |
41.69% |
Net profit |
60.92 |
47.87 |
4,506.77 |
3,402.89 |
32.44% |
Transfer to general reserve |
27.31 |
22.94 |
2,020.34 |
1,630.89 |
23.88% |
Net worth** |
381.61 |
314.56 |
27,899.35 |
23,799.84 |
17.22% |
Earnings per share (EPS) (Basic) |
0.80 |
0.62 |
58.97 |
44.38 |
32.88% |
Earnings per share (EPS) (Diluted) |
0.80 |
0.62 |
58.97 |
44.38 |
32.88% |
Book value per equity share |
4.99 |
4.12 |
365.06 |
311.41 |
17.22% |
Market value per equity share as on March 31 |
|
|
|
|
|
BSE Limited |
- |
- |
1,918.75 |
551.00 |
248.23 |
National Stock Exchange of India Limited |
- |
- |
1,922.05 |
550.95 |
248.86 |
[Conversion Rate USD 1 = Rs.73.98 for Profit and Loss items; USD 1 = Rs.73.11 for
Balance Sheet items (Financial Year 2020-21) and USD 1 = Rs.71.09 for Profit and Loss
items; USD 1 = Rs.75.66 for Balance Sheet items (Financial Year 2019-20)]
*Includes notional interest on lease liability Rs.57.53 million recognized in
accordance with IND AS - 116 on Leases for the year ended March 31, 2021. (Financial Year
2019-20: Rs.61.22 million)
**Net worth = Equity Share Capital + Reserves and Surplus (excluding Gain on bargain
purchase) + Other Comprehensive Income
The highlights of the financial performance on an unconsolidated basis for the year
ended March 31, 2021 are as under:
|
(Amount in USD million except EPS and Book Value) |
(Amount in Rs. million except EPS and Book Value) |
% Change (based on amounts in Rs.) |
Particulars |
2020-21 |
2019-20 |
2020-21 |
2019-20 |
|
Revenue from Operations |
335.17 |
296.54 |
24,796.08 |
21,081.22 |
17.62% |
Earnings before interest, depreciation, amortization and taxes |
82.58 |
60.90 |
6,109.04 |
4,329.65 |
41.10% |
Finance Cost* |
0.52 |
0.63 |
38.21 |
44.51 |
(14.15%) |
Depreciation and amortization |
7.66 |
7.81 |
566.79 |
555.12 |
2.10% |
Other income |
15.90 |
22.49 |
1,176.16 |
1,599.04 |
(26.45%) |
Tax expense |
22.02 |
17.61 |
1,629.34 |
1,251.83 |
30.16% |
Net profit |
68.27 |
57.35 |
5,050.86 |
4,077.23 |
23.88% |
Transfer to general reserve |
27.31 |
22.94 |
2,020.34 |
1,630.89 |
23.88% |
Net worth** |
378.27 |
303.80 |
27,655.24 |
22,985.38 |
20.32% |
Earnings per share (EPS) (Basic) |
0.89 |
0.75 |
66.09 |
53.17 |
24.30% |
Earnings per share (EPS) (Diluted) |
0.89 |
0.75 |
66.09 |
53.17 |
24.30% |
Book value per equity share |
4.95 |
3.98 |
361.86 |
300.76 |
20.32% |
Market value per equity share as on March 31 |
|
|
|
|
|
BSE Limited |
- |
- |
1,918.75 |
551.00 |
248.23 |
National Stock Exchange of India Limited |
- |
- |
1,922.05 |
550.95 |
248.86 |
[Conversion Rate USD 1 = Rs.73.98 for Profit and Loss items; USD 1 = Rs.73.11 for
Balance Sheet items (Financial Year 2020-21) and USD 1 = Rs.71.09 for Profit and Loss
items; USD 1 = Rs.75.66 for Balance Sheet items (Financial Year 2019-20)]
*Includes notional interest on lease liability Rs.38.09 million recognised in
accordance with IND AS - 116 on Leases for the year ended March 31, 2021. (Financial Year
2019-20: Rs.43.86 million)
**Net worth = Equity Share Capital + Reserves and Surplus + Other Comprehensive Income
Material Events Occurring after Balance Sheet Date
There were no material changes and commitments affecting the financial position of your
Company between the end of the financial year 2020-21 and the date of this report.
Particulars required as per Section 134 of the Companies Act, 2013
As per Section 134 of the Companies Act, 2013 (the Act'), your Company has
provided the Consolidated financial statements as on March 31, 2021. Your Directors
believe that the consolidated financial statements present a more comprehensive picture as
compared to standalone financial statements. These documents are available for inspection
during the business hours at the Registered Office of your Company and the respective
subsidiary companies. A statement showing financial highlights of the subsidiary companies
is enclosed to the consolidated financial statements.
The Annual Report of your Company does not contain full financial statements of the
subsidiary companies, however, your Company will make available the audited annual
accounts and related information of the subsidiary companies in soft copy in line with the
Ministry of Corporate Affair (MCA) Circular dated May 5, 2020 and its extentions from time
to time upon request by any Member of your Company.
Consolidated financial statements
Consolidated financial statements of your Company and its subsidiaries as at March 31,
2021 are prepared in accordance with the Indian Accounting Standard (Ind AS) 110 on
Consolidated Financial Statements' notified by the MCA and forms part of this Annual
Report.
Auditors
Appointment of Statutory Auditors
The Members of your Company at the 30th Annual General Meeting (AGM) held on
July 24, 2020, appointed M/s. Walker Chandiok & Co LLP, Chartered Accountants (Firm
Registration No. 001076N/N500013) as the Statutory Auditors of your Company to hold such
office for a period of 5 (Five) years i.e. up to the conclusion of the 35th AGM
to be held in the calendar year 2025; on or before September 30, 2025.
Further, in terms of the Regulation 33(1)(d) of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 (the Listing Regulations'), the Statutory
Auditors of your Company are subjected to the Peer Review Process of the Institute of
Chartered Accountants of India (ICAI). M/s. Walker Chandiok & Co LLP have confirmed
that they hold a valid certificate issued by Peer Review Board' of ICAI and have
provided a copy of the said certificate to your Company for reference and records.
Secretarial Audit Report
Pursuant to Section 204 of the Act, the Board of Directors had appointed M/s. PVS and
Associates, Practicing Company Secretary as the Secretarial Auditors of your Company for
the financial year 2020-21.
Accordingly, the Secretarial Auditors have given their report, which is annexed hereto
as Annexure A. A single observation mentioned therein by the Secretarial Auditors is self
explanatory in nature.
Reporting of frauds by auditors
During the year under review, neither the statutory auditors nor the secretarial
auditor has reported to the Audit Committee, under Section 143(12) of the Companies Act,
2013, any instances of fraud committed against the Company by its officers or employees,
the details of which would need to be mentioned in the Board's report.
Adequacy of Internal Financial Controls
Your Board is responsible for establishing and maintaining adequate internal financial
control as per Section 134 of the Act.
Your Board has laid down policies and processes in respect of internal financial
controls and such internal financial controls were adequate and were operating
effectively. The internal financial controls covered the policies and procedures adopted
by your Company for ensuring orderly and efficient conduct of business including adherence
to your Company's policies, safeguarding of the assets of your Company, prevention and
detection of fraud and errors, accuracy and completeness of accounting records and timely
preparation of reliable financial information.
Internal Audit
The details of the internal audit team and its functions are given in the Management
Discussion and Analysis Report forming part of this Annual Report.
Disclosure of Cost Audit
Your Company had filed Form 23C for appointment of Cost Auditor relating to its
activities of generation of electricity from windmill turbine under the Companies (Cost
Audit Report) Rules, 2011. However, based on another Circular dated November 30, 2011
issued by the MCA, your Company claimed exemptions from the requirement of the Cost
Auditor for the said purposes and accordingly, had written a letter dated December 19,
2012 to the MCA, Cost Audit Branch, for withdrawal of the appointment of the said Cost
Auditor as well as cancellation of the Form 23C so filed. Reply to the said letter is
awaited from the MCA.
Particulars of Loans and Guarantees given and Investments made
Loans, guarantees and investments covered under Section 186 of the Act form part of the
notes to the financial statements provided in this Annual Report. (Refer notes 6. 15. 16.
34 and 43 of the Standalone Financial Statements)
Transfer to reserves
As per the policy of your Company on transfer of surplus profit to reserves, an amount
of Rs.2,020.34 million has been transferred to the General Reserve and an amount of
Rs.2,026.45 million will be retained in the Statement of Profit and Loss after payment of
dividend. The balance in Profit and Loss Account as on March 31, 2021 is Rs.11,888.23
million.
Fixed Deposits
In terms of the provision of Sections 73 and 74 of the Act read with the relevant
Rules, your Company has not accepted any fixed deposits during the year under report.
Liquidity
Your Company continues to maintain adequate amount of liquidity to meet the necessary
strategic and growth objectives. Your Company aims to balance between earning adequate
returns on liquid assets and the need to cover financial and business risks. As at March
31, 2021, your Company, on an unconsolidated basis, had cash and cash equivalents
(including investments) amounting to Rs.17,711.05 million as against Rs.12,687.08 million
as at March 31, 2020.
The details of cash and cash equivalents (including investments) are as below:
|
|
(In Rs.million) |
Particulars |
As on March 31, 2021 |
As on March 31, 2020 |
Investment in Mutual Funds at fair value |
7,181.94 |
7,339.28 |
Fixed Deposits with scheduled banks |
7,108.47 |
2,643.65 |
Bonds (quoted) |
2,557.92 |
2,171.52 |
Cash and Bank balances |
862.72 |
532.63 |
Total |
17,711.05 |
12,687.08 |
The particulars of expenditure on Research and Development on accrual basis are as
follows:
|
|
(In Rs.million) |
|
Year ended on March 31 |
Particulars |
2021 |
2020 |
Capital expenditure |
- |
1.04 |
Revenue expenditure |
196.72 |
243.05 |
Total research and development expenditure |
196.72 |
244.09 |
As a percentage of total income |
0.76% |
1.08% |
The particulars of foreign exchange earnings and outgo, based on actual inflows and
outflows are as follows:
|
|
(In Rs.million) |
|
Year ended on March 31 |
Particulars |
2021 |
2020 |
Earnings |
21,209.15 |
19,207.33 |
Outgo |
3,770.79 |
5,241.20 |
Update on Fixed Deposits with IL&FS
One of the investments in your Company's treasury portfolio, is in the form of fixed
deposits with Infrastructure Leasing and Financial Services Limited (IL&FS) and
IL&FS Financial Services Limited (IL&FS Group) to the extent of Rs.430 million.
These were due for maturity from January 2019 to June 2019. In view of the uncertainty
prevailing with respect to recovery of outstanding balances from IL&FS Group, your
Company has fully provided for these deposits along with interest accrued thereon till the
date, as the deposits had become doubtful of recovery. Your Company continues to be
hopeful of recovery though with a time lag and continues to monitor developments in the
matter and is committed to take steps including legal action that may be necessary to
ensure full recovery of the said deposits.
Related Party Transactions
The Policy to determine materiality of related party transactions and dealing with
related party transactions as approved by the Board of Directors is available on your
Company's website at https://www.persistent.com/investors/related-party-
transactions-policy/
During the year under report, your Company did not enter into any material transaction
with any party who is related to it as per the Act. There were certain transactions
entered into by your Company with its foreign subsidiaries and other parties who are
related within the meaning of Indian Accounting Standard (Ind AS) 24. Attention of Members
is drawn to the disclosure of transactions with such related parties set out in Note No.
34 of the Standalone Financial Statements, forming part of this Annual Report. The Board
of Directors confirms that none of the transactions with any of related parties were in
conflict with your Company's interest. The list of Related Party Transactions entered into
by your Company for FY 2020-21 (on consolidated basis) are available on
https://www.persistent.com/investors/related-partv-transactions-policv/
The related party transactions are entered into based on considerations of various
business requirements, such as synergy in operations, sectoral specialization and your
Company's long-term strategy for sectoral investments, optimization of market share,
profitability, legal requirements, liquidity and capital resources of subsidiaries.
All related party transactions are entered into on an arm's length basis, are in the
ordinary course of business and are intended to further your Company's interests.
The information on transactions with related parties pursuant to Section 134(3)(h) of
the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure
B in Form No. AOC-2 and the same forms an integral part of this report.
B. Board and its Committees
Board Meetings
The details pertaining to the composition, terms of reference and other details of the
Board of Directors of your Company and the meetings thereof held during the Financial Year
2020-21 are given in the Report on Corporate Governance forming part of this Annual
Report.
Directors and Key Managerial Personnel
During the year under report, the Members of your Company in 30th AGM
confirmed the appointment/re-appointment as follows:
a. Re-appointment of Dr. Anand Deshpande (DIN: 00005721), Chairman and Managing
Director of your Company as the Managing Director of the Company liable to retire by
rotation, to hold office for a period of 5 (Five) years i.e. up to the conclusion of the
35th Annual General Meeting of the your Company to be held on or before
September 30, 2025.
b. Confirmation of appointment of Mr. Praveen Kadle (DIN: 00016814) as an Independent
Director of your Company, not liable to retire by rotation, to hold office for 5 (Five)
consecutive years i.e. up to April 22, 2025.
Further, Mr. Prakash Telang and Mr. Kiran Umrootkar, Independent Directors of your
Company, retired at the conclusion of the 30th AGM of your Company held on July
24, 2020.
During the year under report, Mr. Christopher O'Connor, Executive Director and Chief
Executive Officer resigned effective from August 9, 2020 due to his personal reasons. He
has confirmed that there were no material reasons for his resignation other than the
reason mentioned above.
Subsequently, the Board of Directors, at its meeting held in October 2020, appointed
Mr. Sandeep Kalra, Executive Director and President as the Chief Executive Officer of your
Company with effect from October 23, 2020. Accordingly, his designation changed to
Executive Director and Chief Executive Officer'.
Also, Mr. Sunil Sapre, Executive Director and Chief Financial Officer was appointed as
the Executive Director of your Company for a period of 3 (Three) consecutive years for a
term up to January 26, 2021. Accordingly, his term of appointment ended on January 26,
2021.
During the year under report, your Board has appointed Mr. Sunil Sapre as an Additional
Director (Executive Member) with effect from January 27, 2021 till September 30, 2024
subject to the approval of the Members at the ensuing AGM.
The Board of Directors of your Company at the meeting held on June 10, 2021 recommended
Mr. Sapre's appointment as an Executive Director for the term up to September 30, 2024.
Your Board considered his expertise, wide industry experience and financial acumen for
recommending his appointment. Pursuant to the provisions of the Act, he is liable to
retire by rotation.
Mr. Sapre has confirmed his eligibility and willingness to accept the office of the
Director of your Company, if confirmed by the Members at the ensuing AGM. In the opinion
of your Directors, Mr. Sapre has requisite qualifications and experience and therefore,
your Directors recommend that the proposed resolution relating to the appointment of Mr.
Sapre be passed with the requisite majority. Mr. Sapre's profile forms part of this Annual
Report and has also been provided in the Notice of the 31st AGM.
In terms of Section 152(6) of the Act and Article 137 of the Articles of Association of
your Company, Mr. Sandeep Kalra, Executive Director and Chief Executive Officer is liable
to retire by rotation at the ensuing AGM as he is the Non-Independent Director who is
holding office for the longest period among the Non-Independent Directors on the current
Board.
Mr. Kalra has confirmed his eligibility and willingness to accept the office of the
Director of your Company, if confirmed by the Members at the ensuing AGM. In the opinion
of your Directors, Mr. Kalra possess requisite qualifications and experience and
therefore, your Directors recommend that the proposed resolution relating to the
re-appointment of Mr. Kalra be passed with the requisite majority.
At present, your Company has 6 (Six) Non-Executive Directors who are Independent
Directors. Pursuant to the Regulation 17(1)(b) of the Listing Regulations, every listed
company shall have at least half of its total strength of the Board of Directors as
Independent Directors where Chairman is an Executive Director. Your Company complies with
this requirement.
There is no inter-se relationship between the Directors.
In terms of the Listing Regulations, your Company conducts the Familiarization Program
for Independent Directors about their roles, rights and responsibilities in your Company,
nature of the industry in which your Company operates, business model of your Company
etc., through various initiatives. The details of the same can be found at:
https://www.persistent.com/investors/familiarisation-programme/
Declaration of Independence by Independent Directors
The Board confirms that all Independent Directors of your Company have given a
declaration to the Board that they meet the criteria of independence as prescribed under
Section 149(6) of the Act along with Rules framed thereunder and Regulation 16 of the
Listing Regulations.
They have been already registered with MCA Databank of Independent Directors.
During the Financial Year 2020-21, a separate meeting, exclusively of the Independent
Directors was held on April 25, 2020, in which the Independent Directors have transacted
the following businesses along with few other important strategic and policy related
matters:
1Reviewed performance of the Executive Directors and Management of the Company
2Discussed the quality, quantity and timeliness of the flow of information between the
Directors and the Management of the Company
3Discussed the strategic matters of the Company and current state of the global IT
industry
4Discussed the role of the Executive Management in the recent COVID-19 outbreak and
business continuity plan in the organization
Committees of the Board
The details of the powers, functions, composition and meetings of all the Committees of
the Board held during the year under report are given in the Report on Corporate
Governance forming part of this Annual Report.
Audit Committee
The details pertaining to the composition, terms of reference and other details of the
Audit Committee of the Board of Directors of your Company and the meetings thereof held
during the financial year are given in the Report on Corporate Governance forming part of
this Annual Report. The recommendations of the Audit Committee in terms of its Charter
were considered positively by the Board of Directors of your Company from time to time
during the year under Report.
Nomination and Remuneration Committee
The details including the composition and terms of reference of the Nomination and
Remuneration Committee and the meetings thereof held during the financial year and the
Remuneration Policy of the Company and other matters provided in Section 178(3) of the Act
are given in the Report on Corporate Governance section forming part of this Annual
Report.
The policy for appointment of a new director on the Board is as follows:
The Board of Directors decides the criteria for the appointment of a new director on
the Board from time to time depending on dates of retirement of existing Directors and the
strategic needs of the Company. The criteria include expertise area, industry experience,
professional background, association with other companies and such other important
parameters.
Once the criteria is determined, the Board directs the Nomination and Remuneration
Committee to compile profiles of suitable candidates through networking, industry
associations and business connects. The Nomination and Remuneration Committee considers
each and every profile on the decided parameters and shortlists the candidates.
Shortlisted candidates are then interviewed personally or through tele-conference by the
Members of this Committee.
Once the Committee is convinced about a candidate's competency, his/her business
acumen, commitment towards his/her association with your Company, disclosure of his/her
interest in other entities and his/her availability for your Company on various matters as
and when they arise, it recommends the candidate to the Board of Directors for its further
consideration. Generally, the Board accepts the recommendation by consensus.
Performance Evaluation of the Board, its Committees and Directors
Your Company conducted the annual performance evaluation of the Board, the Chairman,
its various Committees and the Directors individually including Independent Directors. The
performance evaluation was done by an external management consultant who specialized in
Board evaluations. The performance of the Board was evaluated by seeking inputs from all
the directors and senior management. The evaluation criteria include aspects such as the
board composition and structure, effectiveness of board processes, information and
functioning, etc. The evaluation was conducted in March and April 2021 and the findings of
the evaluation were presented at the meetings of the Nomination and Remuneration Committee
and the Board of Directors held in April 2021.
Extract of the qualitative comments received during the Board evaluation for the year
under report were as follows:
1Improvements have been made in focusing Board discussion on strategic issues. This
needs further improvement. This may be due to the new management team that has not
adequately interacted with the Board and with the fact that meetings have not been held in
person and have been only online.
2The risks are changing very fast. More work needs to be done to ensure that we are
managing risks adequately.
3The Investment Committee is a welcome new group which could be leveraged more by the
Management.
Proposed actions based on current year's comments:
1The impact assessment of risks in Risk Repository is a regular activity and is being
conducted on quarter to quarter basis. This activity will be conducted more rigorously
henceforth.
2The Investment Committee of the Company was reconstituted in July 2020 to focus and
particularly assess the investment opportunities through acquisitions, mergers and joint
ventures. The Committee also reviews the previous investments made by your Company during
its periodic meetings.
Previous year's observations (For FY 2019-20) and actions taken are as follows:
For the previous year, the comments received from the external management consultant
were generic in nature and hence there were no specific actions required.
Employees' remuneration
In terms of the provisions of Section 197(12) of the Act read with Rule 5 of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement
showing the names and other particulars of the employees drawing remuneration in excess of
the limits set out in the said rules are provided as Annexure C to the Report.
Employee stock option plans
Your Company has various stock option plans for its employees. Details of the stock
options granted under various employee stock option schemes are provided as Annexure D to
the Report.
During the year under report, no employee has been granted stock options, equal to or
exceeding 1% of the issued capital (excluding outstanding warrants and conversions) of
your Company at the time of grant.
In line with the Ind AS 102 - "Share Based Payments", your Company has
computed the cost of equity-settled transactions by using the fair value of the options at
the date of the grant and recognized as employee compensation cost over the vesting
period.
During the year under report, 187 employees were granted 1,832,500 options under the
Employee Stock Option Plan 2017. No new options or shares were granted to the Independent
Directors of your Company during the year under report.
Shares held by the Independent Directors and Non-Executive Non-Independent Director as
on March 31, 2021 are as under:
Name of the Director |
Shares held (through exercise of vested stock options) |
Shares held (through allotment under a pre IPO scheme) |
Shares held (through market purchase/IPO) |
Total Shares held |
Roshini Bakshi |
NIL |
NIL |
NIL |
NIL |
Pradeep Bhargava |
12,000* |
NIL |
NIL |
12,000 |
Guy Eiferman |
NIL |
NIL |
NIL |
NIL |
Dr. Anant Jhingran |
NIL |
NIL |
NIL |
NIL |
Praveen Kadle |
NIL |
NIL |
NIL |
NIL |
Thomas Kendra |
NIL |
NIL |
NIL |
NIL |
Prof. Deepak Phatak |
NIL |
NIL |
NIL |
NIL |
* Granted before April 1, 2014.
During the year under report, the Nomination and Remuneration Committee have granted
RSU's to the following Director and senior executive of your Company:
Name of the RSU Grantee |
Designation |
Date of Grant |
No. of RSU's |
Sandeep Kalra |
Executive Director and Chief Executive Officer |
November 1, 2020 |
50,000 |
Charles Owen |
Chief Corporate Development Officer |
February 1, 2021 |
15,000 |
During the year under report, pursuant to the resolutions passed by the Nomination and
Remuneration Committee of the Board of Directors by way of circulation, employees
including ex-employees exercised their stock options for shares which were already vested
in their name. During this year, 391,382 (Three Hundred Ninety-One Thousand Three Hundred
and Eighty-Two) i.e. 0.51% Equity Shares of the total Paid-up Capital were transferred by
PSPL ESOP Management Trust to the eligible employees including ex-employees at an
aggregate value of Rs.66.56 million under various ESOP Schemes of your Company.
Your Company has 13 (Thirteen) ESOP Schemes as on March 31, 2021 under which options
were granted to various Independent Directors, employees of the Company and its
subsidiaries, details of which are given elsewhere in this Annual Report.
Corporate Social Responsibility
Your Company formed a Public Charitable Trust Persistent Foundation' in
the Financial Year 2008-09 to institutionalize your Company's CSR initiatives and to
develop a systematic approach to administer the process of grant of donations.
Last year, Persistent Foundation (the Foundation') celebrated its eleventh year
of establishment. During these 12 years, the Foundation has contributed to many projects
spread across different geographies in association with well-known NGOs to reach out to
large number of beneficiaries.
Your Company acknowledges the contribution made by the Foundation in coordinating and
ensuring that the CSR donations made by your Company are being effectively deployed as
proposed and have an impact on the society,
During the year under report, the Foundation was able to continue to create excitement
among employees to participate in socially relevant causes, With cooperation of the
employees of your Company, the Foundation has set up several well-defined programs and
activities for the promotion of education, health, community development and assistance in
natural calamities, These activities are carried out through projects undertaken by the
Foundation with the support of the employees and through the Government authorities,
reputed social organizations and institutions,
In addition to contributing Rs.140 million to the Foundation, your Company made a
donation of Rs.10 million to PM CARES Fund directly, Thus, during the year under report,
your Company donated Rs.150 million i,e, more than 2% of the Average Net Profits of your
Company made during three immediately preceding financial years, The Company has also
donated Rs.10 million to Chief Minister's Relief Fund (COVID-19), Maharashtra which is not
considered as CSR Activity in terms of Sch, VII of the Act.
In the growing concern of COVID-19 pandemic, your Company has taken a decision to make
worldwide donations and has allocated USD 3,30 million towards the same, Details of these
donations form an integral part of Report on CSR activities,
Report on CSR activities of your Company under the provisions of the Act during the
Financial Year 2020-21 is annexed hereto as Annexure E,
A detailed Report on the activities of the Foundation forms an integral part of this as
Report on CSR activities,
CSR Committee and CSR Policy
The Board of Directors of your Company has constituted the CSR Committee to help your
Company frame, monitor and execute the Company's CSR activities under its CSR scope, The
Committee defines the parameters and observes them for effective discharge of the
Company's social responsibility,
The Board of Directors of your Company has further approved the CSR Policy of your
Company to provide a guideline for the Company's CSR activities, The CSR Policy is also
uploaded on your Company's website at
https://www,persistent,com/investors/csr-at-persistent/
The Company's CSR Policy highlights that the need for contributing to the society is
very large and your Company can make a more significant contribution by staying focused on
few areas through its social initiatives, The CSR policy recommends that your Company
should encourage Persistent Foundation to contribute in the following focus areas:
1Health 2Education
3Community Development 4Assistance in Natural Calamities
The constitution of the CSR Committee is provided in the Report on Corporate Governance
section forming part of this Annual Report,
C. Equity and Related Information
Listing with the stock exchanges
The Equity Shares of your Company are listed on BSE Limited (BSE) and the National
Stock Exchange of India Limited (NSE) since April 6, 2010, Listing fees for the Financial
Year 2020-21 have been paid to both BSE and NSE,
Institutional Holding
As on March 31, 2021, the total institutional holding in your Company stood at 48,85%
of the total share capital,
Dividend for the Financial Year 2020-21
The details of the Dividend for the Financial Year 2020-21 and 2019-20 are as follows:
|
Financial Year 2020-21 |
Financial Year 2019-20 |
Type of Dividend |
Interim |
Final |
Interim 1 |
Interim 2 |
Month of Declaration/recommendation |
Jan-21 |
Apr-21 |
Jan-20 |
Mar-20 |
Amount of Dividend Per Equity Share of Rs.10 each (In f) |
14 |
6 |
9 |
3 |
% of Dividend |
140% |
60% |
90% |
30% |
Total Dividend (Amt. in Rs.million) |
1,069.95 |
458.55 |
687.83 |
229.28 |
Dividend Distribution Tax (Amt. in Rs.million)* |
- |
- |
87.47 |
18.67 |
Total Outflow (Including Dividend Distribution Tax) |
1,069.95 |
458.55 |
775.30 |
247.95 |
(Amt. in Rs.million) |
|
|
|
|
Total Dividend Outflow for the year (Amt. in ^ million) |
1,528.50 |
1,023.25 |
*The Finance Act, 2020 in India has repealed Dividend Distribution Tax (DDT). The
dividend income is taxable in the hands of shareholders w.e.f. April 1, 2020.
The payment of final dividend of Rs.6 per share is subject to your approval during the
31st AGM of your Company. The Dividend will be paid out of profits of your
Company.
Out of the interim dividend declared in January 2021, Rs.0.19 million remained
unclaimed as on March 31, 2021.
Your Company has Dividend Distribution Policy and the same has been uploaded on the
website at
https://www.persistent.com/wp-content/uploads/2016/09/Dividend-Distribution-Policy.pdf.
As per the policy, the dividend pay-out ratio shall be maintained up to 40% of the
Consolidated Profit After Tax. The above dividend is in compliance with the Dividend
Distribution Policy of the Company and the pay-out ration for the Financial Year 2020-21
is 33.92% subject to approval by the shareholders for the proposed final dividend.
Pursuant to the Finance Act 2020, dividend income will be taxable in the hands of
shareholders w.e.f. April 1, 2020 and your connect this paragraph for various categories,
the shareholders are requested to refer to the Finance Act, 2020 and amendments thereof.
In this regard, your Company has availed the facility for online submission of Tax
Exemption forms from M/s. Link Intime India Private Limited (Link Intime') wherein
the shareholders can submit their tax-exemption forms along with other required documents.
The requisite form for claiming tax exemption can be downloaded from Link Intime's
website. The URL for the same is as under:
https://www.linkintime.co.in/client-downloads.html On this page, select the General
tab. All the forms are available under the head "Form 15G/15H/10F".
The aforementioned documents (duly completed and signed) are required to be uploaded on
the URL mentioned below: https://linkintime.co.in/formsreg/submission-of-form-15g-15h.html
On this page, the user shall be prompted to select/ share the following information
to register their request.
1Select the company (Dropdown)
2Folio/DP-Client ID 3PAN
4Financial year (Dropdown)
5Form selection
a. Document attachment - 1 (PAN)
b. Document attachment - 2 (Forms)
c. Document attachment - 3 (Any other supporting document)
Please note that the documents (duly completed and signed) should be uploaded on the
website of Link Intime in order to enable the Company to determine and deduct appropriate
TDS/Withholding Tax.
Incomplete and/or unsigned forms and declarations will not be considered by the
Company.
The Members may note that in case the tax on said interim/final dividend is deducted at
a higher rate in absence of receipt of the aforementioned details/documents, option is
available to the Members to file the return of income as per the Income Tax Act, 1961 and
claim an appropriate refund, if eligible.
Transfer of Unclaimed Dividend and corresponding shares to the IEPF Authority
During the year under report, your Company has transferred the unclaimed and unpaid
dividend of Rs.209,720 to the IEPF Authority. Further, 210 corresponding shares on which
the dividend was unclaimed for seven consecutive years have been transferred as per the
requirement of the IEPF Rules. The details are provided in the shareholder information
section of this Annual Report and also available on the website:
https://www.persistent.com/investors/unclaimed-dividend/
The Board has appointed Mr. Amit Atre, Company Secretary, as the Nodal Officer to
ensure compliance with the IEPF rules.
Shares Suspense Account
Your Company operates an Unclaimed Securities Suspense Account' on behalf of the
allottees who were entitled to the Equity Shares under the initial public offering. Some
of the Equity Shares could not be transferred to the respective allottees due to technical
reasons. Such shares are held in Unclaimed Securities Suspense Account', to be
transferred to allottees as and when they approach your Company. Your Company regularly
uploads details of such unpaid/unclaimed shares on your Company's website and on the
website of the MCA as well.
The current balance in the above-mentioned Suspense Account as on March 31, 2021 is 140
Equity Shares owned by 7 allottees. The details of equity shares held in an
Unclaimed Securities Suspense Account' are as follows:
S. No. |
Particulars |
Details |
1\ |
Aggregate number of allottees in the Unclaimed Securities Suspense Account lying at
the beginning of the Financial Year 2020-21 |
7 allottees |
2\ |
Aggregate number of the outstanding equity shares in the Unclaimed Securities Suspense
Account lying at the beginning of the Financial Year 2020-21 |
140 Equity shares |
3\ |
Number of allottees who approached issuer for transfer of shares from Unclaimed
Securities Suspense Account during the Financial Year 2020-21 |
Nil |
4\ |
Number of shares transferred from Unclaimed Securities Suspense Account during the
Financial Year 2020-21 |
Nil |
5\ |
Aggregate number of allottees in the Unclaimed Securities Suspense Account lying at
the end of the Financial Year 2020-21 |
7 allottees |
6\ |
Aggregate number of outstanding equity shares in the Unclaimed Securities Suspense
Account lying at the end of the Financial Year 2020-21 |
140 Equity shares |
Note: Voting rights on the above-mentioned equity shares are kept frozen till the
rightful owner of such equity shares claim these shares. Once the rightful owner claims
these shares, the shares along with accumulated dividend will be transferred to the
rightful owner.
D. ESG
Conservation of energy and technology absorption
Your Company believes that conservation of energy is essential and as a responsible
corporate citizen, your Company must encourage all employees, vendors and other
stakeholders to act on ensuring reduced usage of energy on a perpetual basis.
Your Company has procured various energy saving devices and systems, which help in
conserving energy and has resulted into a significant savings in the energy cost.
Your Company has made the necessary disclosures in this Report in terms of Section
134(3) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014.
Carbon management and sustainable development provide business with some of the
greatest opportunities towards sustainability. Your Company reduced carbon footprints by
taking energy conservation measures. Thanks to the reduced travel, both because of local
commuting and air travel, the carbon footprint this year is lower. Your Company continues
to take various measures on energy saving and sustainability as follows:
Energy Efficiency Activities
1Upgradation of ACs: Existing AC's based on R-22 gas replaced with energy efficient
Inverter based ACs based on environment friendly gases R-32/R-410 /R 407 C
2Regulated & optimized the schedules of lifts, vending machines, ventilation
system, HVAC system etc. as per occupancy 3Great emphasis on Energy Conservation with an
in-house team of experts:
a. LEDs in place of CFLs
b. Ozonators in ACs (which also disinfects the air and makes the air healthier)
c. Setting optimum temp settings for ACs as a SOP
d. Upgradation of ACs to better VRV technology on an ongoing basis
e. Culture of switching off when not in use', actually practiced
4Thermal Solar water heaters for our cafeterias and Gym saved 44,352 kWh per annum
5Energy saving measures are taken right from design stage like double wall
construction, low-e glass for facades and windows with DGUs, maximum use of natural light
and ventilation, underdeck insulation, etc.
6Updated EHS (Environment Health and Safety) Policy
7Usage of Renewable energy for self-use, 54% Units Generated of total requirement
through Rooftop Solar powerplants and owned two Windmills
8Your Company is an ISO 14064: 2018 [Green House Gases (GHGs) Monitoring and Reduction]
certified company, for India operations and facilities, but including global travel
a. Only IT Company in India to be certified to this standard (latest version)
b. Yearly Target is 3% reduction, which we have been surpassing each year
c. We have reduced over 27% of our carbon footprint in last 5 FYs
9All the facilities of your Company in India are ISO certified by DNVGL for Environment
Management Systems ISO
14001:2015 and Occupational Health and Safety Management System Standard by ISO
45001:2018 certifications, after surveillance audit (January 2021)
Renewable Energy Initiatives, Water Management and Waste Management Initiatives of the
Company for the FY 2020-21 are given in the Business Responsibility Report forming part of
this Annual Report.
Customer experience, operational excellence on Green activities
1Employees feel proud of belonging to a green company and volunteer more for green
initiatives like tree plantation, tree maintenance & society awareness related to
sustainability. Employees contributing regularly for Tree Plantation
2LED lighting has improved the ambience and freshness of workplace
3Customers appreciate our initiatives and sense of Social Responsibility during their
visits, including our ISO 14001 and ISO 14064 certification
4Ozonates improved indoor air quality and higher oxygen levels, clearly felt by inmates
as well as visitors.
We are the very few IT companies to have this feature installed in our AC systems
5We are the very few IT companies to have solar panels on almost all our rooftops and
to own two 2.1 MW windmills
6In addition, also installed Solar panels on Pune and Hyderabad Railway Stations and at
Tarachand Hospital, Pune under CSR activity
7Appreciation from NASSCOM for Green IT Initiatives in Pune city
8Insistence on ecofriendly & high efficiency products, is promoting vendors with
such products 9Impact caused by the implementation of Green initiatives on
employee/end user satisfaction'
10Better, healthy and working environment with freshness, greenery, and brighter
workspaces
11Greater bonding with local community and environmental groups 12Zero Accidents till
date in our entire Organization
13Best practices to preserve the environment/health and safety are undertaken by your
Company even during constructing its various premises by using crush sand, fly ash bricks
and double glass unit, use of gypsum and recycled wood to protect the environment
14It is your Company's constant endeavor to conserve and save the Environment and hence
your Company has launched the Green Persistent Movement' to support the same. This
is aimed at encouraging employees to save energy at their homes. Though power cost
constitutes an insignificant part of the total expenses, the financial impact of these
measures may not be material, but it brings in considerable awareness in the employees and
their families
15Lower insurance premiums as risks and liabilities are reduced
16Building corporate image of organization globally
17Reducing Operation and maintenance costs
18Star Rating Scheme by BEE for two commercial buildings of your Company
ESG Journey at Persistent
Our vision goes beyond business and compliance. We acknowledge that success is not a
stand-alone concept, rather it is an intricate combination of many factors including
environmental and social responsibility, and corporate governance (ESG).
We recognize that a strong ESG proposition can create long lasting value for all our
direct and indirect stakeholders. Our core values- Ingenious, Responsible, Persistent and
Confident are all about transforming new ideas while optimizing our resource
utilization', Be responsible and communicate with clarity', and our global practice
demands Respect and openness towards each other, the communities around us and
global society at large', Stay determined in our activities to help our customers
and people around the world to succeed'. We are constantly on a journey of finding
innovative ways to improvise our business conduct.
For this, we understand that it is crucial to identify and assess how we mitigate our
non-financial risks, and take steps in the right direction accordingly.
Our Environmental commitment
Ingenious' - one of our core values is all about doing more with less. In doing
so, we believe in being versatile in action and agile in thought. Our Environment, Health
and Safety (EHS) Policy provides guidelines on conserving environment and continually
improving our EHS performance. It has been our constant endeavor to ensure that we reduce
the carbon footprint of our business activities. We continue to monitor and work towards
reducing our carbon footprint by sourcing energy from renewable sources like solar and
wind energy, and improving energy efficiency. Similarly, as part of our efforts to
safeguard the environment, we have undertaken watershed and rainwater harvesting projects
in rural Maharasthra, regular tree plantation drives, and plastic free campuses. During FY
2020-21, we planted 10,000+ saplings to celebrate increase in the headcount beyond 10,000
mark. Our efforts were recognized with the "Excellence in Sustainability" award
by iNFHRA for the year 2020-21.
All the facilities of your Company in India are certified to the international
environment, health and safety standards namely ISO 14001:2015 and ISO 45001:2018. Also,
all the facilities of your Company in India are certified by AGS for ISO 14064-1:2006 is
upgraded to ISO 14064-1:2018 for greenhouse gas inventory.
Our Social Commitment
As a responsible organization, it is central to our values to give back to the
community and the environment in which we operate. Our CSR Policy guides us for our CSR
activities. Through Persistent Foundation, we continue to support CSR initiatives focusing
on the three pillars viz. Education, Health and Community Development. In the Financial
Year 2020-21, we supported 14 centers for facial cleft and cleft palate. Out of 14
centers, 12 centers have served COVID-19 patients.
Your Company equally pays attention on the social hygiene among the employees.
Corporate Governance
We believe in exceeding the highest standards of corporate governance as it enhances
the long-term value of the company for its stakeholders. The Management at Persistent is
fully committed to implementing best practices in corporate governance to ensure
transparency, accountability and integrity. All the regulatory compliances applicable to
your Company's operations globally are monitored and tracked through a web-based
Compliance Management Tool. We have established policies and committees to deal with
different corporate governance issues. The Company's Ethics Policy, Code of Conduct for
Director and Employees, Vendor Code of Conduct, Code of Conduct for prevention of insider
trading Anti-Corruption, Fraud Risk Management Policy, Anti-human trafficking policy and
Whistle Blower Policy provide guidance for the highest standards of business ethics and
corporate governance.
ESG Way Forward
Year 2021 marks a milestone year for us as we undertake a review of the progress we
have made so far in our sustainability journey, and chart our future path and ambitions.
As the demand and expectations from the larger society, Governments, regulators and
various other stakeholders for transparent and responsible business conduct keep rising,
we see integration of ESG in our business as a business imperative. ESG analysis and
transparent reporting can provide valuable insights and help create long-term value for
our stakeholders.
We are also aware that ESG is linked directly to facilitating top-line growth, reducing
costs. This will also relate to minimizing regulatory and legal interventions, increasing
employee productivity, optimizing investment and capital expenditures.
We will engage more with our stakeholders
We look forward to understanding our stakeholders better by identifying them and
engaging with them more comprehensively. Our objective would be to identify priority areas
for our stakeholders under the broad domains of environment, social and governance. This
will help us to broaden our ESG focus and rank our priorities in consultation with our
stakeholders. Through stakeholder consultations, we would identify the topics material to
out stakeholders. The material topics will be shortlisted and prioritized based on their
impact on our stakeholder and business and initiating actions.
We will establish an ESG strategy and roadmap
The materiality assessment would form the first step towards developing a long term ESG
strategy and goals for Persistent.
We intend to establish clear ESG targets as our "ESG Ambition - 2030" by
focusing on the right issues where we want to create the most impact over long term. A
detailed road map to achieve these strategic ESG goals will be charted with clear
milestones, action plans and responsibilities. The status of our commitment to the ESG
Ambition - 2030 will be communicated in the annual Sustainability Reporting.
We will communicate more comprehensively
Your Company has been communicating its performance on the various ESG aspects through
its Annual Report and the Business Responsibility Report (BRR). We are looking forward to
strengthening our communication on ESG by aligning it with global sustainability goals and
ESG reporting frameworks such as the UN sustainable development goals and the GRI
sustainability reporting standards. The report will set out a structured process for
reviewing and updating our priorities, focus areas and goals, measuring, reporting and
accountability, and will also help us and our stakeholders to benchmark our ESG
performance and practices. We are working towards coming out with our first stand-alone
ESG report based on the GRI standards by early next year.
E. Other Disclosures
Corporate Governance
A separate Report on Corporate Governance with a detailed compliance report as
stipulated under the Listing Regulations and any other applicable law for the time being
in force forms an integral part of this Report.
Compliance Certificate from the Practicing Company Secretary regarding compliance of
conditions of Corporate Governance as stipulated in the Listing Regulations forms an
integral part of this Annual Report.
Management Discussion and Analysis
Report on Management Discussion and Analysis as stipulated under the Listing
Regulations and any other applicable laws for the time being in force based on audited
consolidated financial statements for the Financial Year 2020-21 forms an integral part of
this Annual Report.
Business Responsibility Report
Report on Business Responsibility as stipulated under the Listing Regulations and any
other applicable law for the time being in force describing the initiatives taken by the
Management from an environmental, social and governance perspective forms an integral part
of this Annual Report.
Risk Management Policy
Report on Risk Management based on the risk management policy developed and implemented
at your Company for the Financial Year 2020-21 forms an integral part of this Annual
Report.
Vigil Mechanism (Whistle Blower Policy)
The details of the vigil mechanism (whistle blower policy) are given in the Report on
Corporate Governance forming part of this Annual Report. Your Company has uploaded the
policy on its website at https://www.persistent.com/ethical-practices-at-
persistent-svstems/whistle-blower-policv/
Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013
Your Company has an Anti-Harassment Policy in place which is in line with requirements
of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal)
Act, 2013 (the Act' for this section). All employees (permanent, contractual,
temporary and trainees) are covered under this policy.
Your Company has constituted an Internal Complaints Committee(s) (ICC) across all
Company locations in India and abroad to consider and resolve all sexual harassment
complaints reported to this Committee. The constitution of the ICC is as per the Act and
the Committee includes an external member from NGOs with relevant experience at India
locations. The Ethics Committee at the global locations acts in the capacity of Internal
Complaints Committee where the local laws over there do not enforce constitution of such
committee.
During the year under report, your Company has received one complaint of harassment of
non-sexual nature which was immediately disposed by following the due process. As on March
31, 2021, there were no pending cases of sexual harassment in your Company.
Secretarial Standards
The Ministry of Corporate Affairs notified the Secretarial Standard on Meetings of the
Board of Directors (SS 1), Secretarial Standard on General Meetings (SS-2),
Secretarial Standard on Dividend (SS-3) and Secretarial Standard on Report of the Board of
Directors (SS-4).
The Company complies with Secretarial Standards and guidelines issued by the Institute
of Company Secretaries of India (ICSI).
Other Certifications
The details about the other ISO and Partnership certifications for technical processes
and systems are provided in Annexure Rs.to this Report and which forms an integral part of
this report.
Information Security
Your Company maintains a matured Information Security Management System with Policies,
Processes and Controls to minimize the Cyber Security Risks. The governance and management
of security compliance and risk is reviewed periodically.
Amid the pandemic and complete lockdown across cities where your Company's offices are
located, most employees are required to work from their respective homes. This
unprecedented situation has increased the security risks due to the expansion of the
security perimeter from office premises to individual homes.
Your Company's internal team has taken a holistic and comprehensive approach to address
the need of securing the employees' laptops, their smartphones, the corporate network and
the confidential data against inadvertent and malicious attacks, including the customer
specific security requirements. Specific steps include allocation of laptops to every
employee, installation of disk encryption and next generation antivirus solution, enhanced
data leakage prevention solutions covering laptops and cloud assets and security controls
on personal smartphones. The team has also provisioned critical data backup, improved
incoming email scanning and enhanced the security and network monitoring solutions.
Periodic external security assessments and proactive security drills help us stay vigilant
to security threats. Mandatory annual employee awareness training to reinforce the
security imperatives is key to keeping your Company safe.
Subsidiary Companies, Associate Companies and Joint Ventures
During the year under Report, Valista Limited, Ireland, step down subsidiary of your
Company was dissolved w.e.f. June 24, 2020 as a part of your Company's corporate
restructuring.
Further, your Company acquired 100% shares of Capiot Software Private Limited, India
(Capiot India') in October 2020. Consequently, Capiot India has become wholly owned
subsidiary of your Company. Additionally, Persistent Systems Inc.,
USA (PSI), wholly owned subsidiary of your Company acquired 100% shares of Capiot
Software Inc., USA ("Capiot US") in November 2020. Consequent to the above,
Capiot US has become a wholly owned subsidiary of PSI and Capiot Software Pte Ltd,
Singapore and Capiot Software Pty Ltd, Australia which are the subsidiary companies of
Capiot US have become step- down subsidiary companies of PSI.
On March 23, 2021, Persistent Systems Inc., USA, wholly owned subsidiary of your
Company incorporated Persistent Systems S.R.L, Italy.
The details of the subsidiaries and associates of your Company as on March 31, 2021 are
as under:
|
|
|
Total Income |
Net Profit/(Loss) |
Name of the Entity and Country of incorporation |
Status |
Period of Establishment/ Acquisition* |
For the period/year ended March 31, 2021 (Amount in ^ million) |
For the period/year ended March 31, 2020 (Amount in ^ million) |
For the period/year ended March 31, 2021 (Amount in ^ million) |
For the period/year ended March 31, 2020 (Amount in ^ million) |
Persistent Systems Inc., USA (PSI) |
Wholly Owned Subsidiary |
October 2001 |
24,243.90 |
21,359.80 |
(167.87) |
(320.62) |
Persistent Systems Pte. Ltd., Singapore (Co. Reg. No. 200706736G) |
Wholly Owned Subsidiary |
April 2007 |
9.96 |
24.66 |
(8.59) |
8.55 |
Persistent Systems France S.A.S., France |
Wholly Owned Subsidiary |
April 2011 |
911.80 |
950.48 |
11.51 |
(11.02) |
Persistent Systems Malaysia Sdn. Bhd., Malaysia |
Wholly Owned Subsidiary |
September 2013 |
376.16 |
419.34 |
40.80 |
56.29 |
Persistent Systems Germany GmbH, Germany |
Wholly Owned Subsidiary |
December 2016 |
185.45 |
85.63 |
(5.02) |
(55.87) |
Persistent Telecom Solutions Inc., USA |
Step-down Subsidiary (Wholly Owned Subsidiary of PSI) |
January 2012 |
758.90 |
1,001.84 |
59.96 |
167.32 |
Persistent Systems Mexico S.A. de C.V., Mexico |
Step-down Subsidiary (Wholly Owned Subsidiary of PSI) |
March 2016 |
286.43 |
251.29 |
(10.35) |
23.05 |
Persistent Systems Israel Ltd, Israel |
Step-down Subsidiary (Wholly Owned Subsidiary of PSI) |
February 2016 |
257.64 |
504.06 |
29.29 |
(3.09) |
Aepona Group Limited, Ireland |
Step-down Subsidiary (Wholly Owned Subsidiary of PSI) |
October 2015 |
44.84 |
8.3 |
33.73 |
(122.16) |
Valista Limited, Ireland (Dissolved with effect from June 24, 2020) |
Step-down Subsidiary (Wholly Owned Subsidiary of Aepona Group Limited) |
October 2015 |
0.10 |
0.89 |
(1.08) |
0.23 |
Aepona Limited, United Kingdom |
Step-down Subsidiary (Wholly Owned Subsidiary of Aepona Group Limited) |
October 2015 |
364.20 |
332.74 |
115.93 |
71.99 |
Persistent Systems Lanka (Private) Limited, Sri Lanka |
Step-down Subsidiary (Wholly Owned Subsidiary of Aepona Group Limited) |
October 2015 |
221.01 |
215.66 |
32.46 |
33.04 |
PARX Werk AG, Switzerland |
Step-down Subsidiary (Wholly Owned Subsidiary of Persistent Systems Germany GmbH) |
August 2017 |
655.85 |
527.33 |
11.50 |
(2.72) |
PARX Consulting GmbH, Germany |
Step-down Subsidiary (Wholly Owned Subsidiary of PARX Werk AG) |
August 2017 |
495.38 |
551.02 |
17.62 |
(48.85) |
Youperience GmbH, Germany |
Step-down Subsidiary (Wholly Owned Subsidiary of Persistent Systems Germany GmbH) |
July 2019 |
539.36 |
223.01 |
(44.45) |
(83.36) |
|
|
|
Total Income |
Net Profit/(Loss) |
Name of the Entity and Country of incorporation |
Status |
Period of Establishment/ Acquisition* |
For the period/year ended March 31, 2021 (Amount in ^ million) |
For the period/year ended March 31, 2020 (Amount in ^ million) |
For the period/year ended March 31, 2021 (Amount in ^ million) |
For the period/year ended March 31, 2020 (Amount in ^ million) |
Youperience Limited, United Kingdom |
Step-down Subsidiary (Wholly Owned Subsidiary of Youperience GmbH) |
July 2019 |
93.84 |
101.11 |
(9.29) |
2.33 |
Capiot Software Private Limited, India** |
Wholly Owned Subsidiary |
October 2020 |
136.47 |
NA |
2.30 |
NA |
Capiot Software Inc., USA** |
Step-down Subsidiary (wholly owned subsidiary of PSI) |
November 2020 |
17.81 |
NA |
(1.54) |
NA |
Capiot Software Pty Limited, Australia** |
Step-down Subsidiary (Wholly Owned Subsidiary of Capiot Software Inc.) |
November 2020 |
8.53 |
NA |
2.92 |
NA |
Capiot Software Pte Limited, Singapore** |
Step-down Subsidiary (Wholly Owned Subsidiary of Capiot Software Inc.) |
November 2020 |
|
NA |
1.97 |
NA |
Persistent Systems S.R.L., Italy** |
Step-down Subsidiary (Wholly Owned Subsidiary of PSI) |
March 2021 |
|
NA |
(0.05) |
NA |
Klisma e-Services Private Limited, IndiaA |
Associate Company |
March 2012 |
- |
- |
- |
- |
* Period of Establishment/Acquisition mentioned above is the period in which the
entities are acquired by your Company directly or through its subsidiaries.
** Acquired/incorporated during FY 2020-21. a Under Corporate Insolvency Resolution
Process for liquidation.
The Policy for determining material subsidiaries of your Company is available on your
Company's website at https://www.persistent.com/investors/policv-on-material-subsidiarv/.
According to the said Policy, Persistent Systems Inc., USA is the material subsidiary of
your Company.
Infrastructure
During the Financial Year 2020-21, the total built-up capacity owned by your Company in
India and abroad was 115,478 m2 which is adequate for 8,800+ employees.
The details of owned facilities of your Company are as follows:
Location |
Year of Acquisition/Completion |
Total Built-up Area (m2) |
Total Seating Capacity (Nos) |
Pune |
|
|
|
1Kapilvastu |
1994 |
202 |
35 |
2Panini |
1998 |
929 |
80 |
3Bhageerath |
2002 |
12,170 |
596 |
4Aryabhata - Pingala |
2007 |
31,680 |
2,644 |
5Hinjawadi |
2012 |
41,446 |
3,197 |
Goa |
|
|
|
1Charak |
1997* |
3,280 |
313 |
2Bhaskar |
2014 |
3,762 |
411 |
Location |
Year of Acquisition/Completion |
Total Built-up Area (m2) |
Total Seating Capacity (Nos) |
Nagpur |
|
|
|
1IT Tower |
2003 |
3,708 |
352 |
2Gargi and Maitreyi |
2011 |
17,279 |
1,183 |
Grenoble, France |
2000** |
1,022 |
50 |
Total |
|
115,478 |
8,861 |
* Company occupied this premises in October 2005 as a part of local entity acquisition.
** Company occupied this premises in August 2011 as part of acquisition of the Grenoble
team.
Along with the Company owned premises, your Company also operates from leased
facilities at Canada, France, Germany, India, Israel, Ireland, Malaysia, Mexico, Scotland,
Sri Lanka, Switzerland, USA and UK.
During the financial year 2020-21, due to the pandemic, the majority of employees were
given an option to work from home and only the employees working in essential category
such as Administration and Information Technology attended the office in person.
Annual Return
In accordance with the Companies Act, 2013, the annual return in the prescribed format
(MGT-7) for the Financial Year 2020-21 is available at
https://www.persistent.com/wp-content/uploads/2021/06/annual-return-2021.pdf
Other matters
Your Directors state that no disclosure or reporting is required in respect of the
following items as there were no transactions on these items during the year under report:
1Dr. Anand Deshpande, Chairman and Managing Director and Mr. Sunil Sapre, Executive
Director and Chief Financial Officer of your Company have not received any remuneration or
commission from any of its subsidiaries. However,
Mr. Christopher O'Connor, Executive Director and Chief Executive Director (resigned
w.e.f. August 9, 2020) and Mr. Sandeep Kalra, Executive Director and Chief Executive
Officer have received remuneration from Persistent Systems Inc., USA in addition to
remuneration received from your Company.
2No significant or material orders were passed by the Regulators or Courts or Tribunals
which impact the going concern status and your Company's operations in future.
Awards and recognitions during the Financial Year 2020-21
1Recognition Award' among 200+ companies in India for "Excellence in
Sustainability" by iNFHRA for the year 2020-21.
iNFHRA is an industry body & member-based organization representing Infrastructure,
Facility Management, Human Resource & Realty industry. This an annual award and is
awarded after rigorous scrutiny by a Juries from the Industry from all over India.
The award categories include:
i. Excellence in Best Project Architecture & Corporate
ii. Excellence in BCP for Corporates, Excellence in Corporate Social Responsibility
iii. Excellence in Sustainability
iv. Excellence in Employee Wellness & Health program for remote workers
v. Excellence in Logistics movement
vi. Excellence in CRE (negotiations, rental, space and consolidation)
vii. Excellence in Return to work strategy/new normal
viii. Excellence in Technology/Transport Management
ix. Excellence in Use of Space Planning & Facility Reservation Systems during &
post COVID-19 crisis
2Named among the top service providers in two Zinnov Zones categories consumer
and enterprise software engineering and recognized as a leader across digital
engineering, AI engineering, cybersecurity and platform engineering
3Golden Peacock Award by Institute of Directors (IOD) for Excellence in Corporate
Governance 2020 in a national category of IT Sector
4Technology Wizards 2020 award Persistent IT team won the prestigious Technology
Wizards Award 2020
5Training Top 125 (T125) 2018 Award (International) from Training magazine
6Named a Top 15 Sourcing Standout for Managed Services in the Q1 2021 ISG Global
Index "Booming 15" category for the 5th consecutive quarter
7Recognized as a Star Performer in Everest Group Software Product Engineering Services
PEAK Matrix Assessment 2021
8Persistent cited as Leader' in ISG's Salesforce Ecosystem Partners 2021 Report
for Salesforce Services in U.S. & Germany
9ISG names Persistent a "Rising Star" for Digital Transformation in its 2020
ISG Provider Lens Healthcare Digital Services U.S. report
10Training Top 100 has honored Persistent for the 4th year for demonstrating
successful & creative learning and development program
11Won the third annual ISG Star of Excellence Award 2020, for the quality of its
core technology services, based on direct feedback from more than 100 enterprise
customers. In addition, ISG also named Persistent as a winner in BFSI and Healthcare and
Life Sciences industries, and in North America and APAC region
12Named to ISG's Booming 15 list (service providers with under US $1 billion in
revenue) globally, as well as in the Americas and EMEA regions, as part of the
second-quarter ISG Index. This is the first time the company has been recognized for
its success in the EMEA region
13Winner of the 2020 Workato Partner Awards in the category of Innovation across
OutSystems, Banking and Snowflake. The award was announced at Workato's recent 2020
Partner Summit, held virtually on June 10th and attended by over 600 registered
partners
14Cyber Sentinel Award 2020 was presented to Mr. Avinash Dharmadhikari, CISO Persistent
Systems in December 2020
15Resilient CISO Award was presented to Mr. Avinash Dharmadhikari, CISO Persistent
Systems as part of the 7th Annual Dynamic CISO Excellence Awards 2021
Directors' Responsibility Statement
Your Directors state that:
1In the preparation of the annual accounts, the applicable Accounting Standards have
been followed and there is no material departure;
2Your Directors have selected such accounting policies and applied them consistently
and made judgments and estimates that are reasonable and prudent so as to give a true and
fair view of the state of affairs of your Company as at March 31, 2021 and of the profit
of your Company for that year;
3Your Directors have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Companies Act, 2013 for
safeguarding the assets of your Company and for preventing and detecting fraud and other
irregularities, if any;
4The annual accounts have been prepared on a going concern basis;
5Your Directors, had laid down internal financial controls to be followed by your
Company and that such internal financial controls are adequate and were operating
effectively;
6Your Directors had devised proper systems to ensure compliance with the provisions of
all applicable laws and that such systems are adequate and operating effectively.
Future Outlook
While brighter days are ahead thanks to the rollout of vaccinations, the pandemic has
caused a permanent and long-lasting impact on each of us as individuals and society.
What's more, every single industry sector was disrupted - forcing a reset for many
businesses in terms of the fundamentals of their operations, business model, and value
chain. While certainly this last year was one of the most challenging in recent times, we
will hopefully all be better prepared for similar events and circumstances in the future.
Thanks to substantial technology innovation and adoption and greater confidence in our
resilience as a society for this preparedness.
Organizations that survived and thrived during this challenging period were those that
quickly understood the power of cloud and data, as well as the role both would need to
play in enabling rapid digital acceleration. If organizations did not fully comprehend
that software was the foundation of the business before the pandemic, they most certainly
realize it today. This realization puts Persistent in an advantageous position in the
market as we look ahead. Fundamentally, our client's most pressing needs have come into a
greater phase with our core strengths in digital engineering, CX transformation, cloud and
many other domains.
Today, your Company creates value along a continuum of client needs, pervasive across
industries.
Imagine We design and deliver new digital experiences, revenue streams and
business models to meet rising customer expectations and accelerate growth.
Engineer We streamline software engineering to drive greater innovation,
efficiency, and resiliency across your products and platforms.
Modernize We reinvent applications, infrastructure, and processes for
greater agility by taking full advantage of automation, intelligence and cloud.
Manage We transform and optimize operations, systems, and product
development to reduce costs and facilitate growth.
Your Company will continue to work aggressively to bolster capabilities in these areas,
both organically and inorganically -extending the value we bring to existing clients and
supporting the development of new client relationships. In addition, we will continue to
enhance our partner ecosystem to complement our expertise, open up new channels and
deliver innovation.
During this period of rapid change, we bring to our clients the depth of expertise
delivered with speed, flexibility, accountability and a sense of urgency unmatched in the
market - truly boutique with scale. As a result, we see our growth momentum continuing as
our clients entrust us with more and more critical aspects of their digital
transformation.
As we continue our path to becoming a $1B Company by FY25, we have established several
key initiatives designed to accelerate our pace, with a focus on enhancing our value
propositions, partner ecosystem, operations, account excellence as well as talent
acquisition and development.
In summary, we are optimistic about your Company's future - as the alignment between
client need and our capabilities are fully aligned, and our ability to execute on this
demand has dramatically enhanced.
Acknowledgments and appreciation
Your Board places on record the support and wise counsel received from the Government
of India, particularly the Department of Electronics and Information Technology, the
Ministry of Corporate Affairs, the Ministry of Finance, the Ministry of Commerce and
Industry, the Reserve Bank of India and the Securities and Exchange Board of India
throughout the financial year.
Your Board extends its sincere thanks to the officers and staff of the Software
Technology Parks of India - Pune, Nagpur, Goa and Mumbai, Visakhapatnam Special Economic
Zone - Andhra Pradesh, SEEPZ Special Economic Zone - Mumbai, Cochin Special Economic Zone,
Central Tax and Customs Department, Department of Revenue, Income Tax Department,
Department of Electronics, Director General of Foreign Trade, Industry Ministry of GoM,
Director of Industries, Maharashtra Pollution Control Board, Department of Shops and
Establishments, Department of Telecommunication, Department of Commerce (SEZ Section),
Regional Director of Western Region, Registrar of Companies, Maharashtra, Pune, Goods and
Service Tax Department, Infotech Corporation of Goa Limited, Goa Industrial Development
Corporation, National Stock Exchange of India Limited, BSE Limited, Central Depository
Services (India) Limited, National Securities Depository Limited, Local Municipal
Corporations and Gram Panchayats where Company operates, Maharashtra State Electricity
Distribution Company
Limited, Telangana (erstwhile Andhra Pradesh) State Electricity Board, Telangana State
Industrial Infrastructure Corporation, Maharashtra Industrial Development Corporation,
Bengaluru Municipal Corporation, Karnataka Industrial Development Corporation, BSNL and
Internet Service Providers, District Administration and State Police departments, Export
Promotion Councils, Maharashtra Airport Development Corporation, MIHAN Authority,
Hinjawadi Industries Association (HIA).
Your Board also extends its sincere thanks to M/s. Walker Chandiok & Co LLP,
Chartered Accountants, Statutory Auditors, M/s. Joshi Apte & Co., Chartered
Accountants, Tax Auditors, M/s. PVS and Associates, Company Secretaries, Secretarial
Auditors, Trustees of Persistent Foundation, wing of Ernst & Young LLP, providers of
Compliance Manager Tool and investor relations services and related advisory for their
services to your Company.
Your Board also extends its thanks to ABSA Capital Bank, Axis Bank, Bank of Baroda,
Bank of India, Barclays Bank, Banco Nacional de Mexico S. A., BNP Paribas, Bank of
Tokyo-Mitsubishi, Citibank NA, CommonWealth Bank, DBS Bank, HDFC Bank Limited, Hongkong
and Shanghai Banking Corporation, ICICI Bank Limited, Kotak Mahindra Bank Limited, Silicon
Valley Bank, State Bank of India, Standard Chartered Bank, Syndicate Bank, Union Bank of
India, VR-Bank Ismaning Hallbergmoos Neufahrn eG, Wells Fargo Bank and their officials for
extending excellent support in all banking related activities.
Your Board places on record its deep sense of appreciation for the committed services
of the associates of your Company at all levels.
Your Board thanks the investors and shareholders for placing immense faith in them.
Your Board takes this opportunity to express its sincere appreciation for the
contribution made by the employees at all levels in your Company. The consistent growth
was made possible by their hard work, solidarity, cooperation and support.
|
For and on behalf of the Board of Directors |
|
Dr. Anand Deshpande |
|
Chairman and Managing Director |
Pune, June 10, 2021 |
DIN:00005721 |
|