DIRECTORS
DEAR MEMBERS,
Your Directors are pleased to present the Sixth Annual Report and audited accounts for
the financial year ended 31 March, 2012.
FINANCIAL RESULTS
The following is the summary of financial performance of the Company during the year
under review
| (Rs. in lakhs) |
| Particulars |
2011-12 |
2010-11 |
| Fees |
12,491.11 |
10,243.16 |
| Operating income |
341.09 |
280.87 |
| Revenue from operations |
12,832.20 |
10,524.03 |
| Total expenses |
10,450.91 |
8,594.82 |
| Earnings before interest, tax, depreciation and amortisation |
2,381.29 |
1,929.21 |
| Less: Financial expenses |
4.79 |
0.22 |
| Less: Depreciation & amortisation expenses |
763.81 |
830.23 |
| Add: Other Income |
404.49 |
207.72 |
| Profit before tax |
2,017.18 |
1,306.48 |
| Provision for tax: |
|
|
| Current tax |
731.00 |
576.00 |
| Current tax relating to prior years |
5.85 |
0.00 |
| Deferred tax |
(96.40) |
(95.31) |
| Profit for the year FY 2011-12 |
1,376.73 |
825.79 |
| Prior period items |
0.01 |
0.00 |
| Profit available for appropriations |
1,376.74 |
825.79 |
| Appropriation: |
|
|
| Proposed dividend |
177.97 |
140.69 |
| Dividend Distribution Tax |
28.87 |
22.82 |
| Transfer to General Reserve |
1,169.90 |
662.28 |
|
1,376.74 |
825.79 |
OPERATIONS
The fees collected, after considering discount and concessions stood at Rs.12,491.11
lakhs as against Rs.10,243.16 lakhs for the previous year registering an increase of
around 21.94%. The operating income stood at Rs.341.09 lakhs (Previous year Rs.280.87
lakhs). Earnings before interest, depreciation, tax and amortisation (EBIDTA) increased by
around 23.43% and stood at Rs.2,381.29 lakhs as compared to previous year`s figure of
Rs.1,929.21 lakhs. Profit after tax increased by 66.72% from Rs.825.79 lakhs in the
previous year to Rs.1,376.73 lakhs in the current year.
Of the total Direct Income for FY 2011-12, 48.07% was contributed by School division,
21.03% by Commerce division, 25.98% by Science division and the balance 4.92% was
contributed by other ventures.
DIVIDEND
Your Directors have recommended a dividend of Rs.0.45 (4.5%) per Equity share (previous
year Rs.0.40 per Equity Share) for the financial year ended 31 March, 2012, on a share
capital of Rs.39,54,78,720 divided into 3,95,47,872 Equity shares of Rs.10/- each.
The total dividend payout including Dividend Distribution Tax of Rs.28.87 lakhs
(previous year Rs.22.82 lakhs) would absorb Rs.206.84 lakhs (previous year Rs.163.51
lakhs).
EMPLOYEE STOCK OPTION PLAN
The Company implemented the Employee Stock Options Scheme "ESOP 2011 - II" in
accordance with the Securities and Exchange Board of India (Employees Stock Option Scheme
and Employee Stock Purchase Scheme) Guidelines, 1999 (the SEBI Guidelines"). The
applicable disclosures as stipulated under the SEBI Guidelines as at 31 March 2012 are
provided in Annexure 1 to this Report.
MANAGEMENT`S DISCUSSION AND ANALYSIS REPORT
Management`s Discussion and Analysis Report for the year under review, as stipulated
under clause 49 of the listing agreement with the BSE Ltd. (BSE) and the National Stock
Exchange of India Ltd. (NSE) is presented in a separate section forming part of the Annual
Report.
CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the Accounting Standard AS-21 on Consolidated Financial Statements
read with Accounting Standard AS-23 on Accounting for investments in Associates, the
audited Consolidated Financial Statements are provided in the Annual Report.
SUBSIDIARIES
In accordance with the general circular issued by the Ministry of Corporate Affairs,
Government of India, the Balance Sheet, Profit and Loss Account and other documents of the
Subsidiary company are not being attached with the Balance Sheet of the Company. However
the financial information of the subsidiary companies is disclosed in the Annual Report in
compliance with the said circular. The Company will make available the Annual Accounts of
the subsidiary companies and the related detailed information to any member of the Company
who may be interested in obtaining the same. The annual accounts of the subsidiary
companies will also be kept open for inspection at the Registered Office of the Company
and that of the respective subsidiary companies. The Consolidated Financial Statements
presented by the Company include the financial results of its subsidiary companies.
Details of subsidiary of the Company are covered in Management`s Discussion and Analysis
Report forming part of the Annual Report.
DIRECTORS
Dr. Chhaya Shastri, Mr. Cyrus Driver & Ms. Drushti Desai, Directors of the Company
retire by rotation and being eligible, offer themselves for re-appointment at the ensuing
Annual General Meeting.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with
respect to Directors` Responsibility Statement, it is hereby confirmed that:
(i) in the preparation of the annual accounts for the year under review, the applicable
accounting standards read with requirements set out under Schedule VI to the Companies
Act, 1956, have been followed and there are no material departures from the same;
(ii) the Directors have selected appropriate accounting policies and applied them
consistently and made judgments and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company as at 31 March 2012 and
of profit of the Company for the year ended on that date;
(iii) the Directors have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the Companies Act, 1956
for safeguarding the assets of the Company and for preventing and detecting fraud and
other irregularities; and
(iv) the Directors have prepared the annual accounts of the Company on a `going
concern` basis.
AUDITORS
M/s. Shaparia & Mehta, Chartered Accountants, Statutory Auditors of the Company,
hold office till the conclusion of the ensuing Annual General Meeting and are eligible for
re-appointment.
The Company has received letter / certificate from M/s. Shaparia & Mehta to the
effect that their appointment as Auditors, if made, would be within the limits under
Section 224 (1B) of the Companies Act, 1956 and that they are not disqualified for
reappointment within the meaning of Section 226 of the said Act.
The Notes on Financial Statements referred to in the Auditors` Report are
self-explanatory and do not call for any further comments.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 217(2A) of the Companies Act, 1956, read with the
Companies (Particulars of Employees) Rules, 1975 as amended, the names and other
particulars of the employees are set out in the annexure to the Directors` Report. Having
regard to the provisions of Section 219(1) (b) (iv) of the said Act, the Annual Report
excluding the aforesaid information is being sent to all the members of the Company and
others entitled thereto. Any member interested in obtaining such particulars may write to
the Company Secretary at the Registered Office of the Company.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption and foreign
exchange earnings and outgo as required to be disclosed under Section 217 (1) (e) of the
Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of
Board of Directors) Rules, 1988 are as follows:
i. Part A&Bof the Rules pertaining to Conversation of Energy and Technology
Absorption are not applicable to your Company
ii. Foreign Exchange Earnings and Outgo:
Earnings: Rs.278.53 lakhs - (Previous year Rs.131.08 lakhs) Outgo: Rs.195.24 lakhs
(Previous year Rs.25.25 lakhs)
PUBLIC DEPOSITS
During the year under review, your Company has not accepted any deposits from the
public or the shareholders.
CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of Corporate Governance and
adhere to the Corporate Governance requirements set out by SEBI. The Company has also
implemented several best Corporate Governance practices as prevalent globally. The Report
on Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part
of the Annual Report.
The requisite Certificate from the Auditors of the Company confirming compliance with
the conditions of Corporate Governance as stipulated under the aforesaid Clause 49 is
attached to this Report.
INCREASE IN THE PAID-UP SHARE CAPITAL
In the extraordinary general meeting held on 13 April, 2011, the shareholders approved
(a) the issue of 140,886 options under the Scheme titled "ESOP 2011-I",
convertible into 140,886 Equity shares of Rs.10 each and (b) the issue of 680,966 Equity
Shares at a consideration of Rs.10 per Equity Share to the Associate Trust. The Company
has on 2 June, 2011 allotted 680,966 Equity Shares to the Associate Trust and the options
granted have been exercised and converted into 140,886 equity shares, as a result of which
the share capital of the Company has increased from Rs.343,510,200 divided into 34,351,020
equity shares of Rs.10 each to Rs.351,728,720 divided into 35,172,872 equity shares of
Rs.10. For more details please refer note 3.5 of the Notes forming part of the financial
statements.
APPRECIATION
Your Directors would like to express their appreciation for the assistance and
co-operation received from the financial institutions, banks, Government authorities,
customers, vendors and members during the year under review.
Your Directors also express their appreciation to all the visiting faculty, lecturers,
employees of MT Educare FAMILY for their hard work, commitment, dedicated services
and collective contribution.
For and on behalf of the Board of Directors
Mahesh R. Shetty
Chairman and Managing Director
Place: Mumbai
Date: 26 May, 2012
Annexure 1
DETAILS OF EMPLOYEE STOCK OPTION SCHEME 2011 - II ("ESOP 2011 - II")
The Company instituted the ESOP 2011 - II on 8 April, 2011, pursuant to Board and
Shareholders` resolutions dated 8 April, 2011 and 13 April, 2011, respectively. The
objective of ESOP 2011 - II was to reward the employees for their past association and
performance as well as to motivate them to contribute to the growth and profitability of
your Company.
The Company has granted 272,912 options convertible into 272,912 Equity Shares of face
value Rs.10 each under ESOP 2011 - II, which represents 0.78% of the pre-Issue paid-up
equity capital of your Company. Your Company does not intend to make further grant of
options under ESOP 2011 - II. The following table sets forth the particulars of the
options granted under ESOP 2011 - II:
| Particulars |
Details |
| Options granted |
272,912 |
| The pricing formula |
Under ESOP 2011 - II, Equity Shares pursuant to exercise of the options were issued at
face value, i.e., Rs.10 |
| Exercise price of options |
Rs.10 |
| Total options vested |
Nil |
| Options exercised |
Nil |
| Total number of Equity Shares that would arise as a result of full exercise of options
already granted |
2,72,912 |
|
|
| Options forfeited/lapsed/cancelled |
Nil |
| Variation in terms of options |
Nil |
| Money realised by exercise of options |
Nil |
| Options outstanding (in force) |
2,72,912 |
| Person wise details of options granted to |
|
| (i) Directors and key management employees |
Please see Note 1 below |
| (ii) Any other employee who received a grant in any one year of options amounting to
5% or more of the options granted during the year |
Please see Note 2 below |
| (iii) Identified employees who are granted options, during any one year exceeding 1%
of the issued capital (excluding outstanding warrants and conversions) of your Company at
the time of grant |
Nil |
| Fully diluted EPS on a pre-Issue basis on exercise of options calculated in accordance
with |
NA |
| Accounting Standard (AS) 20 `Earning Per Share` |
|
| Difference between employee compensation cost using the intrinsic value method and the
employee compensation cost that shall have been recognised if the Company had used fair
value of options and impact of this difference on profits and EPS of the Company |
NA. The Company has used the fair value of options for the purpose of recognising
employee compensation cost. |
| Weighted-average exercise prices and weighted-average fair values of options shall be
disclosed separately for options whose exercise price either equals or exceeds or is less
than the market price of the stock |
NA |
| Description of the method and significant assumptions used during the year to estimate
the fair values of options, including weighted-average information, namely, risk-free
interest rate, expected life, expected volatility, expected dividends and the price of the
underlying share in market at the time of grant of the option |
The Company has adopted Black Scholes method to estimate the fair value of options
with the following assumptions: |
| Particulars |
Details |
|
(i) Risk-free interest rate: 8.3%; |
|
(ii) Expected Life: 1.91 years (weighted average of various vesting periods); |
|
(iii) Expected volatility - 33% (Based on historical prices of the peer companies); |
|
(iv) Expected dividends: Nil |
|
(v) Price of underlying share in market at the time of grant of the option: NA |
| Vesting schedule |
Please see Note 3 below |
| Lock-in |
NA |
| Impact on profits of the last three years |
Nil |
| Intention of the holders of equity shares allotted on exercise of options to sell
their shares within three months after the listing of Equity Shares pursuant to the Issue |
NA |
| Intention to sell equity shares arising out of the exercise of shares granted under
ESOP 2011 - II within three months after the listing of equity shares by Directors, senior
managerial personnel and employees amounting to more than 1% of the issued capital
(excluding outstanding warrants and conversions) |
NA |
Note 1: Details regarding options granted to the Directors and Key Management Personnel
under ESOP 2011 - II are set forth below:
| Name of Director/ Key Management Personnel |
Total No. of options granted |
No. of options exercised |
Total No. of options outstanding |
Total No. of Equity Shares held |
| Anish Thakkar |
120,672 |
Nil |
120,672 |
319,967 |
| Chandresh Fooria |
48,091 |
Nil |
48,091 |
422,353 |
| Shrenik Kotecha |
23,607 |
Nil |
23,607 |
231,085 |
| Sujeet Koyoot |
23,607 |
Nil |
23,607 |
231,085 |
| Anup Gandhi |
20,998 |
Nil |
20,998 |
7,000 |
| Ashwin M. Patel |
7,500 |
Nil |
7,500 |
2,500 |
|
|
|
|
|
Note 2: Employees who received a grant in any one year of options amounting to 5% or
more of the options granted during the year under ESOP 2011 - II:
| | Name of Employee |
Total No. of options granted | |
| Anish Thakkar |
120,672 |
| Chandresh Fooria |
48,091 |
| Shrenik Kotecha |
23,607 |
| Sujeet Koyoot |
23,607 |
| Anup Gandhi |
20,998 |
Note 3: Vesting schedule of the options granted under ESOP 2011 - II:
| Date of vesting |
Percentage of options granted under ESOP 2011 - II
(%) |
|
Category - I* |
Category - II* |
Other Employees |
| 30 September, 2012 or the date of expiry of one year from the date of listing of
Equity Shares, whichever is later |
50.00 |
33.33 |
22.22 |
| 30 April, 2013 or the date of expiry of one year from the date of listing of Equity
Shares, whichever is later |
50.00 |
33.33 |
33.33 |
| 30 April, 2014 or the date of expiry of one year from the date of listing of Equity
Shares, whichever is later |
Nil |
33.34 |
44.45 |
*Category-I and Category-II consist of key management personnel of your Company.
For and on behalf of the Board of Directors
Mahesh R. Shetty
Chairman and Managing Director
Place: Mumbai
Date: 26 May, 2012
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