Dear Members,
We are pleased to present the 14th Annual Report on our business and
operations for the year ended March 31, 2025 of Intellect Design Arena Limited ("the
Company"). This is our Eleventh year of business operations.
1. Results of operations
(In Rs. Million, except EPS data)
|
Standalone |
Consolidated |
Description |
Year ended March 31 |
|
2025 |
2024 |
2025 |
2024 |
Revenue (including other income) |
16,281 |
17,353 |
25,770 |
25,654 |
Operating expenses (excluding, depreciation and finance cost) |
12,605 |
13,801 |
19,694 |
19,671 |
Finance cost |
23 |
8 |
42 |
26 |
Depreciation and amortisation |
1,040 |
893 |
1,564 |
1,372 |
Profit before share of profit from associate and tax |
2,613 |
2,651 |
4,470 |
4,585 |
Share of (loss)/ profit of associates (net of tax) |
- |
- |
(33) |
27 |
Profit before tax |
2,613 |
2,651 |
4,437 |
4,612 |
Income tax expenses |
675 |
995 |
1,093 |
1,385 |
Profit after tax |
1,938 |
1,656 |
3,344 |
3,227 |
Remeasurement (losses)/gains on defined benefit plans |
(5) |
17 |
(5) |
17 |
Exchange differences on translation of foreign operations |
- |
- |
283 |
134 |
Net movement on cash flow hedges |
(161) |
296 |
(160) |
296 |
Other comprehensive (loss)/income for the year, net of tax |
(165) |
313 |
118 |
447 |
Total comprehensive income for the year, net of tax |
1,773 |
1,969 |
3,462 |
3,674 |
Less: Non-controlling interest |
- |
- |
3 |
14 |
Total comprehensive income for the year (attributable to
owners of the Company) |
1,773 |
1,969 |
3,459 |
3,660 |
EPS |
|
|
|
|
Basic Rs. |
14.15 |
12.23 |
24.29 |
23.72 |
Diluted Rs. |
13.75 |
11.78 |
23.60 |
22.85 |
Table No. 1.1
Function wise classification of Consolidated Statement of Profit and
Loss
In Rs. Million
|
Year Ended |
Particulars |
March 31, 2025 |
March 31, 2024 |
INCOME |
|
|
Revenue from operations |
24,955 |
25,131 |
Other income (includes hedge income) |
815 |
523 |
Total Income |
25,770 |
25,654 |
EXPENSE |
|
|
Total expenditure (excluding, depreciation and others) |
19,694 |
19,646 |
EBITDA |
6,076 |
6,008 |
Depreciation and amortisation |
1,564 |
1,372 |
Others |
91 |
39 |
Profit before tax |
4,421 |
4,597 |
Provision for taxation |
(1,093) |
(1,260) |
Profit after tax (PAT) |
|
|
(attributable to owners of the Company) |
3,328 |
3,337 |
Table No. 1.2
Note: PAT above is without considering one-off exceptional item of MAT
credit write-off INR 125 million during the year ended March 31, 2024
2. State of Company's affairs
The consolidated revenue (including other income) for the year ended
March 31, 2025 stood at Rs. 25,770 million compared to previous year's revenue of Rs.
25,654 million. The consolidated profit after tax for the year ended March 31, 2025 and
March 31, 2024 stood at Rs. 3,344 million and Rs. 3,227 million, respectively. The
consolidated reserves and surplus as of March 31, 2025 stood at Rs. 27,164 million as
against Rs. 23,704 million as of March 31, 2024. For FY 25, the Company has not
transferred any amount to the reserves.
3. Material Changes and Commitments
There has been no material changes and commitments, which affect the
financial position of the Company, that have occurred between the end of the financial
year to which the financial statements relate and the date of this report.
4. Dividend
The Board at its meeting held on May 09, 2025 proposed a final dividend
of Rs. 4 / - plus a special dividend of Rs. 3 /- per equity share of face value of Rs. 5/-
each for the financial year ended March 31, 2025, subject to the approval of shareholders
at the ensuing Annual General Meeting and if approved would result in the cash flow of Rs.
972 million. The Dividend Distribution Policy, in terms of Regulation 43A of the
Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015 ("Listing
Regulations") is uploaded on the Company's website. The web link of the Dividend
Distribution Policy is
https://www.intellectdesign.com/investor/general/2018-apr-dividend-distribution-policy.pdf.
5. Subsidiary and Associate Companies
Details of Subsidiary Companies, Associate Companies, and their
financial position.
As on March 31, 2025 Your Company has 26 subsidiaries (16 direct and 10
step down subsidiaries) and 2 associate companies. A report on the performance and
financial position of each of the subsidiaries and Associates is given in Form AOC-1 in
Annexure 1.
Pursuant to the provisions of Section 136 of the Act, the Standalone
and Consolidated audited financial statements of the Company along with relevant documents
and separate audited financial statements of each of the subsidiaries are available on the
website of the Company.
During the period under review, Intellect AI Technologies Limited
(formerly known as Intellect India Limited), a wholly owned subsidiary of the Company has
undergone the name change. DigiVation Digital Solutions Private Limited has become a
Subsidiary Company with effect from February 21, 2025. No other company has become or
ceased to be subsidiary, joint venture or associate of the Company.
6. Cash Position
Your Company has a cash position of Rs. 10,209 million on a
consolidated basis.
7. Share Capital
The paid-up capital of the Company increased to Rs. 69,42,58,845
through share allotments made against exercise of Options (20,27,696 equity shares) under
the ASOP / ISOP / IIPS Schemes, and comprises 13,88,51,769 equity shares at a face value
of Rs. 5 each as on March 31, 2025. The details of all the stock option plans, including
terms of reference, and the requirements are set out in Annexure 2.
8. Corporate Governance
Your Company has been complying with the provisions of Corporate
Governance as stipulated in SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 (referred as "Listing Regulations"). A separate report on
Corporate Governance, along with the Certificate on Compliance of the Corporate Governance
norms as stipulated under Chapter IV of the Listing Regulations is provided elsewhere in
this Annual
Report. The Management's Discussion & Analysis Report forming
part of this report, is provided elsewhere in this Annual Report.
9. Transfer to Investor Education and Protection Fund
As required under the provisions of Section 125 and other applicable
provisions of Companies Act, 2013 (hereinafter "the Act"), dividend that remains
unpaid/ unclaimed for a period of seven years, are to be transferred to the account
administered by the Central Government viz: Investor Education and Protection Fund
("IEPF").
According to Section 124 of Companies Act, 2013 the Company has
transferred unpaid or unclaimed dividend amount within 7 days after expiry of thirty days
to the account opened by the Company on that behalf in the bank called the Unpaid Dividend
Account. Further pursuant to sub-section (5) of section 124 if the amount has not been
paid or claimed for seven consecutive years or more shall be transferred by the Company to
the Investor Education and Protection Fund (IEPF). There were no unclaimed dividend/
corresponding shares required to be transferred to IEPF for the period under review. The
Nodal Officer for the IEPF Authority is Mr. V V Naresh, Company Secretary and Compliance
Officer and the email id is naresh.vv@intellectdesign.com.
10. Conservation of energy, technology absorption, foreign exchange
earnings and outgo
The particulars as prescribed under Section 134 (3) (m) of the
Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, are set out
in Annexure 3 of this Report.
11. Particulars of employees
(a) The statement containing particulars of employees as required under
Section 197 (12) of the Companies Act, 2013 read with Rule 5 (2) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 does not form part of
this report. In terms of Section 136 of the Act, the same is open for inspection during
working hours at the registered office of your Company. A copy of this statement may be
obtained by the members by writing to the Company Secretary. (b) The ratio of remuneration
of each director to the median remuneration of the employees of the Company and other
details in terms of Section 197 (12) of the Companies Act, 2013 read with Rule 5 (1) of
the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are part
of this report as Annexure 4.
12. Business Responsibility & Sustainability Report
In accordance with Regulation 34(2)(f) of the Listing Regulations,
Business
Responsibility and Sustainability Report ("BRSR") covering
disclosures in the prescribed format for FY 2024-25 forming part of this report, is
provided elsewhere in the Annual Report.
13. Directors' Responsibility Statement as required under Section
134 (5) of the Companies Act, 2013
Pursuant to the provisions of Section 134 (3) (c) of the Companies Act,
2013 the Directors of your Company confirm that: a) In the preparation of the annual
accounts, for the financial year ended March 31, 2025, the applicable accounting standards
have been followed and there are no material departures; b) they have selected such
accounting policies, applied them consistently, and made judgements and estimates that are
reasonable and prudent so as to give a true and fair view of the state of affairs of the
Company at the end of the financial year and of the profit of the Company for that period;
c) they have taken proper and sufficient care for the maintenance of adequate accounting
records in accordance with the provisions of this Act, for safeguarding the assets of the
Company, and for preventing and detecting fraud and other irregularities; d) they have
prepared the annual accounts on a going concern basis; e) they have laid down internal
financial controls to be followed by the Company and that such internal financial controls
are adequate and were operating effectively; and f) they have devised proper systems to
ensure compliance with the provisions of all applicable laws and that such systems were
adequate and operating effectively.
14. Board Meetings, Board of Directors, Key Managerial Personnel &
Committees of Directors
(a) Board Meetings:
The Board of Directors of the Company met 7 times during the year
2024-25. The details of various Board Meetings are provided in the Corporate Governance
Report. The gap intervening between two meetings of the board is as prescribed in the Act.
As on March 31, 2025, the Company has 6 (Six) Directors, with an optimum combination of
Executive and Non-Executive Directors including Independent Woman Director. The Board
comprises of 4 (Four) Non-Executive Directors, out of which 3 (Three) are Independent
Directors.
(b) Changes in Executive Directors, Non - Executive Directors & Key
Managerial Personnel: During the year under review, the following changes have been
made and the details are as under: - Mr. Arun Shekhar Aran has completed his tenure as an
Independent Director and ceased to be a part of the Board of Directors on the conclusion
of the Thirteenth Annual General Meeting held on June 26, 2024.
(c) Director liable to retire by rotation
In terms of Section 152 (6) of the Companies Act, 2013 and as per
Article 34 (l) of the Articles of Association of the Company, one third of the Directors
other than Independent Directors are liable to retire by rotation at the Annual General
Meeting of the Company. Mr. Anil Kumar Verma, Director, (DIN:01957168), is liable to
retire by rotation and offers himself for re-appointment.
(d) Independent Directors
Mr. Arun Shekhar Aran (DIN: 00015335) was re-appointed as an
Independent Director at the 8th AGM held on August 21, 2019 for a second term of Five (5)
years. He ceased to be an Independent Director on completion of two terms in office at the
conclusion of 13th Annual General Meeting of the Company held on June 26, 2024.
Mrs. Vijaya Sampath (DIN:00641110) was appointed as an Independent
Director w.e.f. October 25, 2018 for the first term of 5 years and was regularised at the
AGM held on August 21, 2019. Her re-appointment for a second term of 5 years was approved
at the 12th Annual General Meeting held on July 28, 2023. Mr. Abhay Anant Gupte
(DIN:00389288) was appointed as an Independent Director for the first term of 5 years and
was regularised at the AGM held on August 21 2020. His re-appointment as an Independent
Director for the second term of 5 years was approved on May 22, 2025 through postal
ballot. Mr. Ambrish Pandey Jain (DIN: 07068438) was appointed as an Independent Director
w.e.f May 05, 2022 for the first term of 5 years and was regularised at the AGM held on
July 29, 2022. No Director resigned during the financial year 2024-25. The Company has
received necessary declarations from each Independent Director of the Company under
Section 149 (7) of the Companies Act, 2013, that they meet the criteria of independence as
laid down in Section 149 (6) of the Act and in accordance with Regulation 25(8) of SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015. Further, no
Independent Director is a non-independent Director of another Company on the Board on
which any non-independent Director of the listed entity is an Independent Director and no
Director has been debarred by any order / judgement of any regulator in force. The
Independent directors have affirmed compliance with the Code for Independent Directors
prescribed in Schedule IV to the Companies Act, 2013 and confirmed that he/she is not
aware of any circumstance or situation, which exist or may be reasonably anticipated, that
could impair or impact his/ her ability to discharge duties with an objective independent
judgment and without any external influence and that he/she is independent of the
management. In the opinion of the Board, the Independent Directors of the Company possess
requisite integrity, expertise, experience and proficiency.
(e) Details of remuneration to Directors: The information relating
to remuneration of directors as required under Section 197(12) of the Companies Act, 2013,
is given elsewhere in the report.
(f) Board Committees
The Company has the following Board Committees:
1. Audit Committee
2. Nomination, Remuneration & Compensation Committee
3. Stakeholders' Relationship Committee
4. Corporate Social Responsibility Committee
5. Risk Management Committee
Sub-committees:
1. Share Transfer Committee
2. Cyber Security Committee
The composition of each of the above Committees, their respective role
and responsibility is as detailed in the Report of Corporate Governance. The policy framed
by the Nomination, Remuneration and Compensation Committee under the provisions of Section
178(4) of the Act, is as below:
(g) Remuneration policy: The remuneration policy of the Company
has been so structured as to match the market trends of the IT industry. The Board, in
consultation with the Nomination and Remuneration & Compensation Committee, decides
the remuneration policy for Directors. The Company has made adequate disclosures to the
members on the remuneration paid to the Directors from time to time. Remuneration /
Commission payable to Directors is determined by the contributions made by the respective
Directors for the growth of the Company. The remuneration policy of the Company and other
matters as required under Section 178 (3) of the Act can be accessed through
https://www.intellectdesign.com/investor/general/remuneration-policy.pdf. There has been
no change in the policy since the last fiscal year.
We affirm that the remuneration paid to the Directors are as per the
terms laid out in the remuneration policy of the Company.
(h) Board Evaluation
As required under the provisions of Section 134 (3) (p) of the
Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015, the Board has carried out an annual performance evaluation of its own
performance and that of its committees and individual directors. The manner in which such
performance evaluation was carried out is as under: The performance evaluation framework
is in place. Dr. Ashok Korwar, a renowned management consultant, has had technical
education at IIT Bombay, completing a B.Tech Degree. Subsequently, he also studied
management at Indian Institute of Management, Ahmedabad and completed Ph.D at UCLA
Anderson School of Management. He specialises in strategic thinking, go to market
strategies and executive coaching. He has created and developed workshops on account
management, finance for project managers and Design Thinking. He was appointed to evaluate
the performance of the Directors and made a presentation to the Board summarising the
views and suggestions made by the individual Directors and the Board. The performance of
the Board was evaluated on the basis of criteria such as the Board composition and
structure, effectiveness of Board processes, functioning of Board and its Committees,
review of the performance of Executive Directors, overseeing management of sustainability
impacts, succession planning, strategic planning, etc. The performance of the committees
was evaluated by the Board after seeking inputs from the committee members on the basis of
criteria such as the composition of committees, effectiveness of committee meetings, etc.
The Board reviewed the performance of Individual Directors on the basis of criteria such
as exercise of responsibilities in a bonafide manner in the interest of the Company,
striving to attend meetings of the Board of Directors / Committees of which he/she is a
member / general meetings, participating constructively and actively in the meetings of
the Board/committees of the Board, etc. In a separate meeting of independent directors
held on March 07, 2025, performance of Non-Independent Directors, performance of the
Chairman of the Company and the performance of the Board as a whole were evaluated.
(i) Vigil Mechanism
The Company has established a whistle-blower policy and also a
mechanism for Directors and employees to report their concerns. The details of the same is
explained in the Corporate Governance Report.
(j) Related Party Transactions
All related party transactions that were entered during the financial
year were on arm's length basis and were in the ordinary course of business.
There are no other materially significant related party transactions
made by the Company with Promoters, Directors, Key Managerial Personnel or other
designated persons which may have a potential conflict with the interest of the Company at
large. The details of the related party transactions as required under Section 134 (3) (h)
read with Rule 8 of the Companies (Accounts) Rules, 2014 is given in Form AOC-2 in
Annexure 5.
15. Auditor's Reports and Auditors
Statutory Auditors: M/s. M S K C & Associates (now known as
M/s. M S K C
& Associates LLP) (FRN: 001595S/S000168) Chartered Accountants have
been appointed at the 13th Annual General Meeting held on June 26, 2024 to hold office as
statutory auditors until the conclusion of the 18th Annual General Meeting of the Company.
There are no qualifications or adverse remarks in the Auditor's
Report for the financial year ended March 31, 2025.
In connection with the observation made in the Auditor's Report,
though not in the nature of qualification, the Company uses the accounting software that
has a feature of recording audit trail (edit log) facility and is in the process of
enabling this facility for all relevant transactions in the accounting software used for
maintaining books of account for the Company, its subsidiaries and associates.
Secretarial Auditors: Pursuant to the provisions of Section 204 of
the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, Secretarial Audit has been carried out by M/s B Ravi &
Associates, (FRN: P2016TN052400) Practicing Company Secretaries, Chennai and their report
is annexed as Annexure 6. The Secretarial Audit Report does not contain any
qualifications, reservations, adverse remarks or disclaimer. The Board of Directors has,
based on the recommendation of the Audit Committee and subject to the approval of the
shareholders, proposed the appointment of M/s. B Ravi & Associates, Practicing Company
Secretaries, being a peer reviewed firm as the Secretarial Auditors of the Company to hold
office from the conclusion of the 14th Annual General Meeting until the conclusion of the
19th Annual General Meeting to conduct Secretarial Audit for FY 2025-26 to 2029-30. M/s. B
Ravi & Associates have given their Consent vide letter dated January 07, 2025 for
being appointed as Secretarial Auditors of the Company for five years as per Regulation 24
A of SEBI (LODR) Regulations, 2015. Certified that the appointment, if made, shall be in
accordance with the below mentioned conditions: (a) The firm is eligible for appointment
as it is Peer Reviewed Company Secretary and has not incurred any of the disqualifications
as specified by the Board (b) The proposed appointment is as per the terms provided under
the Act; (c) The proposed appointment is within the limits laid down by or under the
authority of the Act; (d) The list of proceedings against the auditor or audit firm or any
of the partner of the audit pending with respect to professional matters of conduct, as
disclosed in the certificate, is true and correct. Accordingly, resolution for the
appointment of M/s. B Ravi & Associates will form part of the notice convening the
14th AGM.
Internal Auditors:
Pursuant to the provisions of Section 138 of the Companies Act 2013
read with Rule 13 of the Companies (Accounts) Rules, 2014 and other applicable provisions,
the Board has appointed M/s. Capri Assurance and Advisory Services, for a period of 2
years with effect from April 01, 2025 till March 31, 2027 as Internal Auditors on the
recommendation of the Audit Committee.
The Reports of the Internal Auditors' issued by M/s. Sharp &
Tannan, Chartered Accountants has been reviewed and taken on record by the Audit Committee
of the Board of Directors of the Company.
Cost Records and Cost Audit: Maintenance of cost records and
requirements of cost audit as prescribed under Section 148(1) of the Companies Act, 2013
are not applicable for the business activities carried out by the Company.
16. Deposits
The Company has not accepted any deposits during the financial year and
as such, no amount of principal or interest was outstanding as on March 31, 2025.
17 . Reporting of fraud:
During the year under review, there were no instances of fraud required
to be reported by the Statutory Auditors / Secretarial auditors of the Company.
18. Social Connect Ullas Trust
Is the collective social responsibility of Intellect that brings
together our associates with the adolescent young minds in the communities we live and
work in, and even going to back our roots in the districts, to experience the magic of
mentoring young minds! Magic as one experiences the joy of shaping young minds, but also
the reverse learning that one receives from these bright sparks that inspires every mentor
to do more and be more. Since its inception in 1997, Ullas has grown into a thriving
community of dedicated associate volunteer mentors from Intellect, from our Clients, and
other Corporates; partners from Civil Society Organisations, and youth from Colleges all
united by the common purpose of shaping the thinking of adolescent young minds. Over the
27 years, Ullas has sown the seed of a dream, ignited and nurtured over 22 lakhs young
minds across 115 Districts, in 8 States and 2 Union Territories. Primary motive of the
Trust continues to be - to ignite young minds and nurture them during their most
vulnerable space in life (adolescence). This is accomplished through seeding the "Can
Do" spirit, encouraging them to dream big with conviction, positive role model
influences, and enrichment programs delivered by mentors to nurture them towards achieving
their potential and their dreams. Academic Year 2024-25 saw the energy and vigour of Ullas
along with its selfless volunteers and mentors coming together to reach out to Young
Achievers, Higher Education Scholars and the schools and deliver the interventions under
Summit, Touch the Soil and Higher Education
Scholarship Program in alignment with the purpose of "igniting
young minds", and sowing the seeds of "Can Do" spirit in every
intervention.
Highlights of this Academic Year:
Ullas Annual Can Do Workshop Ullas Trust celebrated its 27th
Annual 'Can Do' Workshop in Chennai, a day focused on inspiring dreams, building
resilience, and empowering students to reach their full potential. Around 1,200 new Young
Achievers from Government, Government-Aided, and Corporation schools across Chennai came
together for the event, marking the start of their journey of learning and self-discovery
with Ullas. Mr. Arun Jain, Chairman and Managing Director of Intellect, conducted the
session on Purple House through the story of a young boy named Swami from the Indian
village of Malgudi. In the tale, Swami notices a unique Purple House amidst the usual
white, red, brick, and wooden houses. Driven by curiosity, he explores the house's rooms
Imagination Room, Doing Room, Effective Room, Influencing Room, and Giving Room. The
various rooms are linked to different aspects of the mind, urging listeners to expand
their mental space during adolescence as one would expand the rooms of a house. He
highlighted the importance of learning, listening, observing, reading, and engaging in
dialogue to foster personal growth.
Summit Enrichment Program: Ullas impacted the lives of 5300 plus
students from 394 schools across 6 States (Delhi NCR, Haryana, Maharashtra, Tamil Nadu and
Telangana) through the Summit interventions. These interventions brought cheer and
energised all around from the volunteer mentors to the Young Achievers and Higher
Education Scholars as they traversed from one lesson plan to another shaping their
thinking and personality. It was a joy to witness the essence and ethos of Ullas continue
to flourish creating the intended impact.
Touch The Soil - reconnecting to our roots: With greater resolve
Team Ullas took Ullas interventions to students in the classrooms of district schools. The
enthusiasm of reaching out to children in district schools could be easily seen on the
faces of volunteers. Ullas delivered "Can Do" and "Planning" workshops
to over 1.7 lakhs students from 1079
Schools, 114 Districts across 8 States.
Mission Samriddhi Clusters: Across the Mission Samriddhi
Clusters spread across 13 districts and 3 states UP (1 district), Maharashtra (3
districts) and Tamil Nadu (9 districts), Ullas program is getting great support from the
Panchayat and Community members as they come together along with Ullas coordinators and
Mission Samriddhi partners to ensured vibrant, inspiring interactions with young minds to
Dream Big, with deep conviction. With the support of volunteers, teachers and role models
from the community, the intervention programs were powerful in driving home the "Can
Do" spirit.
Ullas HES Virtual Mentoring Sessions by Global Intellect Associates:
An exciting milestone was reached during an enriching engagement that
was conducted from January 22nd to 25th, 2025, as Ullas successfully organised virtual
mentoring sessions for our Higher Education Scholars (HES) in collaboration with Global
Intellect Associates. This initiative brought together Intellect leaders from across the
globe Vietnam, Thailand, Malaysia, Singapore, Dubai, Frankfurt, Vienna, London,
Cirencester, New York, and Toronto who volunteered to mentor our Higher Education Scholars
(HES). The sessions were a blend of virtual and in-person mentoring, co-hosted by
Intellect-Chennai volunteers and Ullas team members. It prove to be fulfilling moment for
the mentors and the mentee.
Ullas a community of Engaged Givers: "The greatness of a
community is most accurately measured by the compassionate actions of its members Coretta
Scott King". Especially during the most uncertain and perilous times.
These words reflect what the Ullas community is all about a community
made up of our incredible volunteer mentors Friends of Ullas as they are known, our
awesome Alumni from across the globe, our very own inspiring Young Leaders who came
together to collectively lift the spirits of young minds through the various programs. Be
it a 2 hour Summit intervention or a 1-1 mentoring program, our Ullas community was not
just empathetic but "compassion in action"! We could not have done this without
this ONE team!
Yet another extraordinary year where the "purity of purpose"
of Ullas continued to shine bright!
Mission Samriddhi
Mission Samriddhi is a social impact platform dedicated to holistic
development of Rural India, through the design and development of projects that are
sustainable and capable of scale to positively impact the larger population. We harness
the energy of existing programmes, activate and extend self-initiated projects,
collaborate with Development Accelerators / CSOs and participate in the change process.
As suggested by the name, Samriddhi', the unifying value is
prosperity for all. Mission Samriddhi believes in the cumulative strength of Celebrate,
Connect, and Catalyse - Celebrate what is working, Connect people, process and
technologies to drive scale & Catalyse the change by providing competence, confidence,
education and funding. Mission Samriddhi empowers rural and marginalised communities to
dream of change by enhancing their self-worth, overcoming constraints, addressing limiting
beliefs and thereby becoming the agents of their development. Mission Samriddhi believes
Design Thinking is a human-centred approach to problem-solving, thus enabling ordinary
people to do extraordinary things. The Design Thinking process goes beyond the mere use of
Design Thinking Tools. It involves the rigour of understanding requirements stated and
unstated, observing and clustering patterns, connecting the dots, and unearthing blind
spots. Applying Design Thinking, Mission Samriddhi evolved the Community Development
Framework (CDF) in consultation with academicians, policymakers and development
professionals to address the complex development challenges. The Community Development
Framework (CDF) adopts an integrated approach to Personal, Social, Economic, Ecological
and Institutional development, with a firm belief in leveraging three levers- the
Sensitivity of the grass-roots organisations/community, the Agility of the Corporates and
the Scale of the Government. Keeping a cluster of Gram Panchayats as the basic unit of
development, the CDF is implemented in chosen clusters through the Cluster Development
Program (CDP).
Key initiatives in financial year 2024-2025 are:
Project Surakshya - CDP Odisha, a joint initiative with Centre for
Youth and Social Development (CYSD), Bhubaneshwar, is co-funded by EU & Intellect CSR
Project Surakshya - CDP Odisha, the holistic Cluster Development
Programme spread across 60 Gram Panchayats in 5 districts of Odisha, is anchored on
Mission Samriddhi's Community Development Framework (CDF) and covers interventions in
Personal, Social, Economic, Ecological and Institutional Development. This project is
co-funded by the EU and Intellect CSR.
Some of the key interventions of the 3-year programme are:
1. Strengthening grassroots institutions including PRIs across the 12
clusters of Gram Panchayats of 5 Blocks in 5 Districts of Odisha (KBK region).
2. Social security entitlements - ensuring none are left out in these
Gram Panchayats.
3. Train and build a cadre of 500 Community Leaders (1 per village)
through a leadership programme spread across 3 Phases that is rooted in the concept of
value-based leadership, self-responsibility and personal growth - to bring about positive
change in the community.
4. Income enhancement of small and marginal farmers with a focus on
women.
5. Skill development, enterprise promotion with a focus on youth.
Highlights of 2024-25:
1. 9,375 beneficiaries have been supported and connected with
different social security schemes of the government for their respective entitlements
2. Through convergence, 1264 HHs received benefits through
incentives and input support such as seeds, saplings, kits etc. while 450 panchayat
residents were provided training in various agri-allied skills such as mushroom
cultivation, poultry and goat rearing, as alternate sources of income.
3. Installation of 02 cold storage units at Kenduguda and Mathapada
Panchayat of Boipariguda Block was facilitated, to reduce distress sale of perishable
commodities.
4. Convergence with ICDS and the Horticulture Department of Kesinga
Block brought benefit to 494 pregnant women and lactating mothers who each received
10 varieties of seeds to grow nutrition garden and improve their health.
5. 424 PRI, CBO & Village Level Committee members were
capacitated to exercise their roles and responsibilities for effective local
self-governance. OSR (Own Source Revenue) mapping was done in 46 of the 60 target GPs and
the analysis of the status has been documented in the form of a report for further support
and action.
6. 11 Panchayat Support Centres have been set up to help
strengthen the functioning of Panchayati Raj Institutions (PRIs) and also facilitate
entitlement linkage of vulnerable and excluded citizens.
7. 8 SHGs/GPLF covering 60 women were taken through GLIDE workshop to
help promote micro enterprises and have independent incomes.
8. 218 Community Leaders have completed the 3-Phases of the
Power to Community leadership training and mentoring program to address their village
level issues through community action. This helps them to facilitate the prevalence of a
Socially Just & Socially Secure Village. These CLs are bringing about change in their
communities by raising their voice for better connectivity to villages, leading
entitlement drives and raising awareness regarding appropriate functioning of AWWs
9. Facilitated preparation of 128 participatory community led Village
Microplans with LSDG (Localised Sustainable Development Goals) theme focus that will be
incorporated into the GPDP (Gram Panchayat Development Plan) 10. 134 Village Mates
and GRS across 3 Blocks were trained on MGNREGS planning to improve demand for person
days' work and requirement of individual assets. 41 job card holders of the Labour Group
in Muduliguda village of Boipariguda Block were oriented to review and collectively demand
work 11.
10 Ullas Libraries in 02 schools per Block, that would use GROWBY
methodology to improve reading outcomes & build interest in reading, were initiated.
27 children from various panchayats of Boipariguda Block participated in a life/youth
camp. The camp emphasized the importance of self-authority and the ability to make choices
that align with long-term goals. 45 children from 6 schools participated in a Bal sabha
conducted in Hatikhoj GP of Kesinga Block. The President and VP were elected
democratically. They interacted with the Sarpanch and other PRI members helping the
children to understand the process of local governance 12. In 02 health-screening camps,
321 & 159 residents from the villages of
Boipariguda Block were tested for malaria & sickle cell anaemia
respectively. Those tested positive were referred to the nearest PHC for further support.
13.
31 Gram Sabhas were facilitated across the 6 blocks for GPDP
preparation and to improve community participation and ownership.
27 Special Mahila Gram Sabhas were facilitated to allow women to
voice their opinions on issues directly impacting them and allowing them to have a
platform to put forth their requirements.
? TN-CDP (Tamil Nadu-Cluster Development Programme)
Intellect CSR initiatives under the Tamil Nadu Cluster Development
Program (TNCDP) are being implemented in 43 Gram Panchayats spread over 9 Clusters and 8
Districts/Blocks of Tamil Nadu. It reflects a strong commitment to sustainable and
inclusive development across thematic areas such as women empowerment, Livelihood
enhancement Sexual awareness & rights, Student education, Nutrition, Organic farming
and grassroots governance. Below are the key engagements in 2024-25 based on identified
Thematic Areas that align closely with India's broader development
goals and ESG principles.
1. Livelihood Initiative in Villupuram District: Focused on
empowering marginalised women through the Samriddhi Collective.
2. Promoting Sexual and Reproductive Health & Rights (SRHR):
Partnered with Rural Women's Social Education Centre (RUWSEC) to
advance gender, sexual, and reproductive health rights.
3. ULLAS Students Holistic Development Programme:
Implemented to enhance student skills through structured sessions.
4. Nutrition Garden Programme: Initiated to encourage
organic vegetable cultivation across multiple districts.
5. Constitution of Biodiversity Management Committees (BMCs):
Facilitated to establish biodiversity management across regions.
6. Creation of Farmers Producer Organisation (FPO): Launched
a pilot organic farming initiative in Karur Cluster with NABARD support.
7. Students Computer Centres of Excellence: Established to
provide digital training in multiple regions.
8. Strengthening Gram Panchayat Development Plan (GPDP)
Convergence in Panchayats: Supported to enhance development planning in rural areas
9. MGNREGS Planning and Implementation Support: Focused on
handholding and support for project preparation.
19. Audit Committee Recommendation
During the year, all the recommendations of the Audit Committee were
accepted by the Board. The Composition of the Audit Committee is as described in the
Corporate Governance Report. All deferred items of the previous meetings were approved in
the subsequent meetings.
20. Annual Return
Pursuant to Section 92 (3) read with Section 134 (3) (a) of the
Companies Act, 2013, the Annual Return in Form MGT 7 shall be placed on the website of the
Company at www.intellectdesign.com/investor-relations after the conclusion of the 14th
Annual General Meeting.
21. Significant & Material Orders passed by the Regulators or
Courts
During the financial year 2024-25, no order has been passed by any
Regulatory authorities or Courts impacting the going concern status and the
Company's operations in future.
22. Particulars of Loans, Guarantees and Investments u/s 186
During the financial year, there was no loan or guarantee given or
security provided pursuant to Section 186 of the Companies Act, 2013 and the relevant
provisions as applicable have been compiled by the Company. Details of investments made by
the Company are given in the Notes to the Financial Statements.
23. Risk Management Policy
Intellect being a pioneer in the Intellectual property led Business in
India, the Company is continuously focussing and committing itself to have a Risk
Management system suited for the Products business.
Towards this, the Board has formed a Risk Management Committee with
Directors, the Chief Financial Officer and the Chief Risk Officer as members of the
committee. The Committee works to mitigate any inherent risks faced by the Business and to
meet the increasing demand of Customer's liability through different means within the
overall framework listed below.
Risk Management Framework Objective
The organization is exposed to a range of risks that may impact its
ability to operate effectively. These include potential disruptions to our business model
arising from shifts in the competitive landscape and rapid technological advancements that
could render our capabilities obsolete. Such developments may hinder our ability to serve
customers efficiently and safeguard critical assets. These risks could adversely affect
customer engagements, employee well-being, shareholder value, third-party relationships,
and property, among other areas. It is therefore essential to manage these risks through a
structured and formal risk management process to ensure the continued resilience and
success of the organization and its stakeholders.
The organisation's Risk policy facilitates the continuous
identification of these Risks on a continuous basis and proposes mitigation measures. Our
risk policy aims to minimise the adverse impact of these risks on Company's growth,
profit margins and people engagement and regulatory compliance. Risk Management has been
made an integral part of the organisation by encouraging risk awareness among employees.
Risk Management Committee
The Risk Management Committee (RMC) of the Board of Directors oversees
the risk management process under the overall direction of the Board of Directors. The
Risk Management Committee consists of some of the Board of Directors, Chief Financial
Officer and the Chief Risk Officer. The Organisation use BELIEF (Brand, End Customer,
Leadership, Intellectual Property, Execution and Finance) framework for its risk
classification. The RMC is supported by the Information and Cyber Security Sub Committee,
Cloud Risk Council and Enterprise Risk Department to execute the overall risk management
plan and periodically update the Risk Management Committee.
Risk Management Process
Risk management is a continuous and evolving process that is integrated
throughout the organization's strategic planning and the execution of its strategy.
Risk Management enables the organisation to proactively manage
Some of the major risks are classified using BELIEF framework as
follows uncertainties in the internal and external environment, aiming to limit the
negative impacts while capitalizing on opportunities. The process includes risk
identification, risk evaluation, risk prioritisation, risk mitigation, risk monitoring
& review.
BRAND CAPITAL
1. Reputation Risk
The brand and reputation risk may arise from issued related to product
implementation, customer relationships and escalations. This risk can be further
accentuated due to increased use of social media & other internet based applications
in the corporate world. The risk is mitigated by adoption of Product, Delivery &
Customer Excellence processes that ensures effective management of implementation's
and client relationships.
END CUSTOMER CAPITAL
2. Business Risk
2.1 Social, Economic, Political Risk
Volatility in the financial markets coupled with geopolitical
uncertainties, trade war, inflationary trends, recession or unforeseen external events may
have resulting cascading effects on the financial sectors such as cost reduction measures.
Additionally, demographic shifts in usage of technology or financial services by consumer
in general may adversely impact the sale of Intellect products. Intellect mitigates this
risk through its global presence, wide range of products to cater different segments
within the financial sectors, penetration into diversified markets & various
geographies; spread of product concentration and increased partnerships.
2.2 Competition Risk
The Company faces competition from large multinational corporations,
local companies in the geographies where we operate and Indian Product companies. While
many of these are well-established firms, the start-ups also have the potential to disrupt
our business. This may pose challenges to maintain or sustain the business growth or
profitability in a longer run. Intellect makes focussed investments in R&D with
continuous evaluations of product endurance across segments & geographies to ensure
products remain relevant & competitive in the business landscape. Ongoing efforts to
enhance the customer experience through deployments of innovative products, such as
iTurmeric, eMACH.ai, usage of generative AI/ML, competitive pricing through operational
efficiencies, cost optimisation measures & improved implementation's with minimal
defects helps us to remain ahead in the innovation curve.
2.3 Business Model Risk
With the rapid adoption of cloud hosting across the industry, the shift
from a traditional License/AMC-based model to a cloud-native SaaS model continues to
redefine the financial technology landscape. While Intellect has made significant progress
in this transformation, managing the implications on revenue, pricing models, customer
expectations, and operational scalability remains a strategic priority. In parallel,
disruptive technologies such as Big Data, Machine Learning (ML), Artificial Intelligence
(AI), and more recently, Generative AI alongside the proliferation of social and smart
devices, are fundamentally changing how financial services are delivered and consumed.
These shifts require continuous innovation and agility to stay relevant and competitive.
Intellect closely monitors this evolving business environment and proactively takes
strategic actions to adapt. A portion of the Company's revenue is now derived from
cloud-based models through SaaS and subscription offerings. Intellect also makes focused
investments in R&D to keep its products relevant and competitive in the industry
landscape and to develop solutions powered by digital technologies.
2.4 Business Concentration Risk
The Company is specialises in BFSI space and could face the risk of
concentration in a single sector. Significant reliance on a particular product, customer,
segments or geography may heighten the risk of revenue loss & consequentially impact
profitability in event of adverse conditions such as customer exit, volatile geo-political
scenarios, sector specific slowdown etc. However, this risk is largely mitigate through
diversification across lines of business, market segments & geographies.
The Company has presence in all the 4 sub segments of BFSI namely
Corporate Banking, Retail Banking, Capital & Wealth Markets and Insurance. These 4 sub
segments have different boom and bust cycles, providing a natural hedge against
volatility. Additionally, Intellect offers multiple products and has a broad client base
to further de-risk the product / business concentration. Intellect mitigates its geography
concentration risk by having its presence across different geographies.
2.5 Customer Service Management Risk
Intellect has contractual agreements with multiple clients across
various countries with distinct needs, requirements and their legal & operating
environment. Morever, the nature of the contracts are long term and if relationships are
not managed effectively, it could have repercussions on the customer persistency &
business growth. The risk is mitigated through regular assessment of the customer
relationships through customer feedback and satisfaction scores. Mechanisms are built in
to monitor adherence to the contractual clauses with its customers. The robust long-term
strategic relationships are built with the customers to enhance customer satisfaction
& value maximisation along with designing, developing & implementing the products
according to industry needs and requirements.
2.6 Contractual Compliance Risk
As a product based Company, Intellect bears the risk of IP
infringements arising from the use of its products and non-performance of its contractual
obligations. These risks may accentuate if the contractual obligations are not aligned to
Intellect's risk appetite. The Company has an established process in place to review
all contracts. As a policy its obligations under each contract are restricted
appropriately. The Company has adequate Insurance obtained to mitigate against risk of
Errors and Omissions, Commercial General Liability etc. Additionally, the Intellect
actively pursuing the registration of intellectual property rights, including filing
patents for key products, to protect its innovations and strengthen its IP portfolio.
LEADERSHIP CAPITAL
3. People Risk
3.1 Talent Management Risk
The Company operates in the niche BFSI product space, which demands
specialised skills rather than mass hiring typically seen in the IT services sector. Given
the rapid evolution of technologies like AI, cloud computing, and enterprise intelligence,
maintaining a workforce aligned with these capabilities is critical to sustaining
innovation and competitive advantage. The broader IT industry has conventionally faced
high attrition rates and challenges in retaining critical talent. Intellect mitigates this
risk through a combination of strategic hiring and capability development initiatives.
These include targeted recruitment from top engineering institutes, business schools, and
talent hubs in Tier 2 cities, as well as lateral hiring to bring in domain-specific
expertise. The Company places strong emphasis on in-depth, in-house training programs and
structured upskilling pathways, including AI certification programs and innovation-led
initiatives such as Hackathons and Buildathons. Background checks (BGC) are mandated for
all new hires and are periodically audited to ensure compliance and integrity in the
hiring process. These approaches not only address the risk of talent gaps but also present
an opportunity to build an agile, innovation-driven workforce enhancing both employee
retention and organisational performance in the evolving digital landscape.
3.2 Associate Conduct Risk
Robust mechanisms are essential to prevent or minimise inappropriate
conduct such as fraud, sexual harassment, criminal attempts, unethical practices, bribery,
or breaches of Company policies including the Code of Conduct, Conditions of Employment,
and Insider Trading as well as other forms of professional negligence, errors, or
omissions. Inadequate controls in these areas can adversely impact the organisation's
work culture, reputation, asset and property security, and overall business performance.
To mitigate these risks, Intellect has established a comprehensive
framework of policies and processes, supported by adequate training and awareness
programmes for its associates, along with regular monitoring. Policies on whistleblower
protection, escalation protocols, incident management, and response mechanisms implemented
in conjunction with the established Disciplinary Committee enable effective resolution of
any instances of inappropriate conduct.
INTELLECTUAL PROPERTY CAPITAL
4.1 Information & Cyber Security Risk
Internal and external cyber threats if not effectively managed, can
potentially result in data leakage, source code compromise and disruption of core
operations. These incidents can significantly impact Company's brand image and reputation.
The risk is mitigated with the Central Security Group, which governs the information &
cyber security needs and posture for the organisation. Controls are regularly evaluated
through internal and external assessments in the form of audits and certifications like
ISO 27001,
ISO 27017, ISO27018, PCI DSS and SOC2. Intellect's security policy
is maintained across the organization ensuring consistent implementation of cybersecurity
practices. Additionally, cyber liability insurance is maintained to safeguard against any
financial loss arising out of security breaches.
4.2 Data Protection & Privacy Risk
The confidential data of the customers and associates is subjected to
data privacy laws of various states. Inadequate procedures to manage data confidentiality
and privacy can result in data breaches, posing significant reputational and regulatory
risks. The risk gets accentuated on account of heightened regulations or guidelines such
as General Data Protection Regulation (GDPR), India's upcoming Digital Personal Data
Protection Act (DPDPA), as well as widespread usage of emerging technologies used to
enhance customer experience, which may pose challenges to protect data & the privacy
elements. The risk is mitigated by putting data authorisation process in place, provision
of necessary guidance to the delivery teams with data security practices. In line with
this, GDPR related compliance reviews are facilitated for applicable business / functional
teams
Vulnerability Assessment & Penetration Test (VAPT) and Dynamic
Application Security Testing (DAST) is being enforced across all Product releases.
Further, there is an adopting new contractual provisions in existing and new contracts
perhaps. With the DPDPA still evolving, our current processes are being reviewed and
aligned in preparation for future regulatory requirements.
4.3 Intellectual Property Rights Infringement Risk:
a) IP protection: The Company's intellectual property,
including proprietary algorithms, software platforms, data models, trademarks, patents and
other intangible assets is a key driver of its competitive advantage and revenue model.
Given the cross-border nature of fintech services, ensuring robust IP protection across
jurisdictions presents challenges due to varying legal frameworks. To mitigate risks such
as infringement, unauthorised use, or misappropriation, the Company employs a
multi-pronged approach, including:
Registration of IP rights in key geographies with robust legal
frameworks.
Implementation of internal controls and oversight measures to safeguard
proprietary assets.
Partnering with external legal advisors to strengthen risk
identification efforts and support the enforcement of intellectual property rights as
needed.
Granting controlled access to proprietary assets through structured
licensing arrangements while strategically expanding market presence.
This framework ensures the integrity and protection of the
Company's intellectual property, enabling sustained innovation, business continuity,
and long-term value creation.
b) Risk of use of "Open Source" Software
"Open Source" Software (OSS) may be used in some of our
solutions. Failure to abide with the terms of the open source licenses could have a
negative impact on our business. The risk is mitigated through adoption of the open source
policy which facilitates to identify, monitor, review, report & thereby facilitate
restricted & acknowledged usage of the open source software on an ongoing basis. In
addition, the use of commercial Off-The-Shelf (COTS) software is governed by formal
agreements and subject to periodic audits by the IT department. Free and Open Source
Software (FOSS) utilised by business units is reported to the IT department to ensure
central oversight and compliance with internal policies.
EXECUTION CAPITAL
5.1 Global Operations Risk
Global operations may get impacted on account of various factors
inherent to the international business activities and differences in the following: Laws
and Regulations in the banking & financial service, complex tax regimes, licensing
requirements, varied trade / tariff policies & corruption perception index, data
protection and privacy laws, economic sanctions, outbreaks of war, hostilities, terrorism,
mass immigration, international embargoes, economic sanctions and boycotts and staffing
challenges and immigration laws. Specific policies and procedures put in place with regard
to work practices, Code of Conduct, anti-bribery, anti-money laundering, data protection
and privacy etc. In addition, professional consultation from reputed tax firms is sought
periodically to ensure compliance with evolving tax and regulatory requirements.
5.2 Cloud Infrastructure Management Risk
With increasing adoption of cloud technologies, the Company faces
several risks related to cloud operations. These include the need for highly skilled
resources to manage complex cloud environments, navigating unique contractual arrangements
with customers and cloud service providers, ensuring adequate security controls by
third-party vendors, and complying with stringent regulations such as GDPR. The Company is
exposed to the risk of SLA violations or security breaches by cloud service providers,
which could result in financial penalties and reputational damage. To mitigate this risk,
a Cloud Operational Governance Framework has been established to ensure consistent
management of cloud environments across business lines. Periodic reviews are conducted to
evaluate the effectiveness of security measures, internal controls, disaster recovery,
backup processes, SLAs, and service contracts with cloud providers. Additionally, the
Company has obtained ISO 27018 certification to reinforce its commitment to cloud data
security and privacy.
5.3 Product Implementation Risk
Delays, errors or omissions during project implementation's could
hamper our delivery capabilities leading to multiple risks such as delay in collections,
violation of contractual commitments, fines / penalties and reputational damages. The risk
is mitigated through delivery excellence processes, along with continuous monitoring &
reporting of implementation's progress using various tools. Further, the Company
adequately insures itself for any liabilities arising on account of errors & omissions
or any delays.
5.4 Defects or Security Vulnerability Risk
Inability to identify or detect defects or security vulnerabilities in
Intellect's existing or new products either at development stage or subsequently in
the various versions or enhancements of the products. Inability to meet the customer
expectations in its entirety regarding the timeliness and the quality of the defect
resolution process. This may result in refunds, damage claims, termination of existing
arrangements, product replacement or negative publicity impacting future demand
proposition of the product, increased costs (service, maintenance & warranty cost
etc.) Intellect has a comprehensive Delivery Excellence framework and Quality Management
process in place as part of the product design development and implementation lifecycle.
Moreover, extensive testing is performed to identify and resolve any issues which may
adversely affect the functionality, security and other performance of the products and
offerings.
5.5 Compliance Risk
Inadequate or non compliances to the material laws & regulations
applicable in the respective countries having business presence may lead to fines /
penalties / closure of the offices resulting in revenue loss. The Company Secretarial team
monitors the secretarial & compliance related activities. Country specific statutory
compliance requirements of our Overseas Subsidiaries are regularly monitored and reported.
The subsidiary compliance is ensured periodically under various jurisdictions.
5.6 Litigation Risk
As Intellect operates across multiple jurisdictions, it is subject to
diverse regulatory and legal frameworks. Legal proceedings in any geography may have
uncertain outcomes, potentially resulting in monetary penalties, injunctive relief, or
other restrictions that could impact the Company's ability to conduct business in
those regions. To mitigate these risks, a comprehensive contract review process is in
place to evaluate and balance potential financial and reputational exposures. The Company
also has a dedicated legal team that works closely with business units and relevant
stakeholders to assess the scope, terms, and associated legal risks of each deal.
5.7 Business Continuity Risk
In the current global environment, influenced by the aftermath of the
COVID-19 pandemic, increasing geopolitical tensions, rising cyber threats, and
climate-related disruptions, the importance of a robust and adaptive business continuity
framework has become critical. Inadequate or poorly designed business continuity plans
covering people, processes, and technology can significantly impair the organisation's
ability to respond effectively to unforeseen events such as natural disasters, pandemics,
cyberattacks, supply chain disruptions, or other Force Majeure incidents. Such disruptions
may adversely affect service delivery, client obligations, and overall business
performance. To mitigate this risk, Intellect has implemented a comprehensive
enterprise-wide Business Continuity Management (BCM) framework, supported by
project-specific continuity plans. Contractual provisions have been established to address
liabilities arising from Force Majeure events. A dedicated team is responsible for the
continuous monitoring, maintenance, and review of all continuity arrangements. To ensure
operational readiness and resilience, periodic simulations and testing drills are
conducted annually. These measures aim to safeguard stakeholder interests and maintain
uninterrupted operations during adverse conditions.
5.8 Fraud Risk
Mechanisms to prevent, detect, measure, monitor and report the
potential collusion touch points, fraud events or criminal hackings if not robust may
result in revenue leakage, financial losses or reputation damage for the Company. To
mitigate the risk, potential fraud areas are assessed as part of regular audit programmes
including performance of Vulnerability and Penetration testing across product release.
Risks associated with potential fraud for identified design gaps are reported to the
Internal Audit Committee with suitable action plans. Further, Crime insurance cover is
obtained to safeguard against any direct financial loss arising out of fraudulent
activities by associates.
5.9 New Country Entry Risk
Failure to thoroughly study, evaluate, identify, analyse, and address
country specific risks at the point of entry into a new geography can significantly
undermine the organisation's long term strategic objectives and operational
stability. Entering a new market involves a complex interplay of political, economic,
regulatory, social, and cultural dynamics that must be carefully assessed and understood.
As such, every potential business opportunity in a new country should be preceded by a
comprehensive Country Risk
Assessment. This assessment serves as a critical decision making tool,
enabling the organisation to develop a robust and informed knowledge base. It facilitates
a structured understanding of the local environment, covering aspects such as regulatory
frameworks, political stability, economic conditions, legal systems, sociocultural norms,
and potential reputational risks. Early insights gained through this process are essential
for tailoring the business strategy, ensuring regulatory compliance, and fostering local
stakeholder engagement. Moreover, the Country Risk Assessment plays a pivotal role in
designing and implementing appropriate risk mitigation measures. These measures help
safeguard the organisation from unforeseen challenges, reduce exposure to volatility, and
enhance the overall resilience of the business model. By integrating country risk
considerations into the broader strategic planning and risk management framework,
organisations are better positioned to pursue sustainable growth, maintain governance
standards, and protect shareholder value when expanding into new international markets.
5.10 Sustainability Risk
Intellect recognises its responsibility to manage risks associated with
environmental sustainability, social impact, human rights, and corporate governance. These
risks may arise from:
Environmental factors, such as climate change resulting in extreme
weather events linked to increased greenhouse gas emissions, loss of biodiversity due to
habitat destruction, and risks of product obsolescence in the transition to a low-carbon
economy.
Regulatory risks, including non-compliance with evolving
sustainability-related regulations, standards, or disclosure requirements (e.g.,SEBI BRSR
guidelines).
Social risks, such as the potential impact on human rights and
community well-being.
Governance risks, stemming from lapses in ethical conduct,
transparency, or board oversight.
Failure to effectively address these risks could lead to operational
disruptions, reduced investor and client confidence, regulatory penalties, reputational
damage, and financial loss. A comprehensive discussion of these risks, their potential
impacts, and corresponding mitigation measures is provided in the Company's
Sustainability and BRSR (Business Responsibility and Sustainability Reporting) Report.
FINANCIAL CAPITAL
6.1 Liquidity Risk (Larger Order to Cash Cycle)
Our customers being large Banks and Financial Institutions the credit
worthiness is in comfort even though the cycle is long. The percentage of bad debts is
also minimal. Since the Products business has a long order to cash cycle, delays in
conversion of REB into invoicing or recovery of the billed invoices from the clients /
customers may result in strain over the Company to meet their working capital
requirements, recurring, fixed & direct costs which may require increased borrowings,
finance charges and thereby impact the Company's profitability. The risk is mitigated by
arrangement of required credit lines through various Banks, regular monitoring of ageing
of receivables / REB balances by the management and robust recovery & follow-ups
mechanisms with clients / customers. The Company has identified Liquidity Risk as an area
to monitor. The Finance organisation headed by the CFO monitors the liquidity position
consisting of cash and near cash instruments on a continuous basis.
6.2 Market Currency Fluctuation Risk
The Company earns a large portion of its revenue in foreign currencies
and is exposed to the risk of currency movements. To mitigate this risk, the Company
follows a 2 step strategy.
As the first step, quotation in foreign currencies is restricted to a
few selected major currencies. Quotations in other currencies are subject to strict
internal controls and approvals to manage exposure.
Secondly, the Company hedges its net foreign currency earnings
calculated after accounting for local currency expenses, to protect against exchange rate
volatility and minimise financial impact.
6.3 Global Tax Regimes
Intellect operates across multiple geographies, therefore subject to
the tax regulations of various jurisdictions. Amendments to tax regulations, particularly
those governing intellectual property, transfer pricing, or cross-border transactions, may
adversely affect the Company's profitability and expose the firm to regulatory and
reputational risk. This risk is mitigated through proactive consultation with tax
advisors, ongoing assessment of regulatory developments, and active representation through
industry and trade bodies to advocate for stable and transparent IP tax regimes.
Additionally, the Company continues to invest in research and development to create
intellectual property assets, enabling it to avail applicable tax incentives and benefits.
Risk Mitigation through Insurance
The Company has appointed a global leader for Risk & Insurance
advisory to advise on the risk and insurance coverage. The following Insurance coverage is
taken to mitigate risks.
1. Errors & Omissions Insurance - To safeguard against any loss
arising of an error, negligent act or omission which would result in failure in performing
the professional services or duties for others.
2. Cyber Liability Insurance - To safeguard against any loss arising
out of a security breach and or privacy breach that would result in sensitive or
unauthorised data or information being lost or compromised.
3. Crime Insurance - To safeguard against any direct financial loss of
property, money or securities arising out the fraudulent activities committed by the
employee or in collusion with others.
4. Directors & Officers Liability Insurance - To safeguard against
any loss arising out of a wrongful act made by the Directors, Officers and
Employees of the organisation with reference to the Company's
business operations and activities.
5. Commercial General Liability Insurance - To safeguard against Third
Party bodily injury or property damage arising out of our business operations.
6. Standard Fire & Special Perils Insurance - To protect the
Company's Assets (movable & immovable Assets) from the risk of Fire or Perils.
28.4 Financial Reporting Risk Internal Financial Control (IFC)
The Company has to comply with additional controls enforced by Section
134 of the Companies Act 2013. This is to report on the Internal Financial Control in the
Directors Report and also by the Statutory Auditors. Key internal controls over financial
reporting if not designed, identified and operated effectively may result in
mis-statements going unnoticed and impact the true and fair view of the financial /
operational results of the Company. To comply with this, the Company assesses the existing
control environment through regular internal and statutory audits and ensures that the
requirements are complied.
24. Corporate Social Responsibility
The Company has formed Corporate Social Responsibility Committee on
October 15, 2014 and reconstituted on July 24, 2019 and August 05, 2020. Following are the
members of the Committee: a) Mr. Anil Kumar Verma Chairman b) Mr. Abhay Anant Gupte Member
c) Mr. Arun Jain Member As per Section 135 of the Companies Act, 2013, a Company meeting
the applicability threshold, needs to spend at least 2% of its average net profits for the
immediately preceding three financial years on CSR activities. The details of the policy
developed and implemented by the Company is given as a part of Annual Report on CSR as
Annexure 7.
25. Secretarial Standards
The Company complies with all applicable mandatory secretarial
standards as issued by the Institute of Company Secretaries of India.
The Company has devised proper systems to ensure compliance with the
provisions of all applicable Secretarial Standards issued by the Institute of Company
Secretaries of India and that such systems are adequate and operating effectively.
26. Disclosure as required under Section 22 of Sexual Harassment of
Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
The Company has in place an Anti-Sexual Harassment Policy in line with
the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013. The Internal Complaints
Committee ("ICC") has been set up to redress the complaints
received regarding sexual harassment. All employees are covered under this policy. The
following is the summary of the Complaints received and disposed off during the financial
year 2024-25: a) No. of Complaints filed during the year: 2 b) No. of Complaints disposed
during the year: 1 c) No. of Complaints pending as at end of the financial year: 1* *The
Company has received two complaints during the financial year 2024-25 out of which one was
disposed off and one complaint is under investigation as on March 31, 2025
27. Listing Fees
The Company confirms that it has paid the annual listing fees for the
year 2024-25 to both the National Stock Exchange of India Limited and BSE Limited.
28. Certifications
Your Directors would like to appreciate the achievements of the
Governance and Assurance department, which enabled your Company to get certified for ISO
9001 for iDC in Global Consumer Banking (iGCB) business. Your Directors would also like to
appreciate the achievements of Cards Business team and Central Security Group for PCI DSS,
PCI S3 certification, and the achievements of iAI business team and Central Security Group
for SOC 2 certification for Insurance products. Your Directors would also like to
appreciate the achievements of the Central Security Group for ISO 27001, ISO 27017, ISO
27018, ISO 22301 Certifications on Information Security Management System, Cloud Security,
Cloud data Privacy and Business continuity respectively. Your Directors would also like to
appreciate the achievements of the Facilities administration team for ISO 14001
Certification on Environment Management System and for ISO 45001 for Occupational Health
& Safety.
29. Insolvency and Bankruptcy Code, 2016 (31 of 2016)
There was no application made or any proceeding pending under the
Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the financial year. There was no
instance of one-time settlement with any bank or financial institution.
30. General
Your Directors state that no disclosure or reporting is required in
respect of the following items as there were no transactions/events on these items during
the year under review: i. Issue of Equity Shares with differential rights as to Dividend,
voting or otherwise. ii. Issue of Sweat Equity Shares to employees of the Company under
any scheme.
Difference between amount of valuation done at the time of one-time
settlement and the valuation done while taking loan from the Banks or Financial
Institutions.
31. Acknowledgment
Your Directors take this opportunity to express the gratitude to all
investors, clients, vendors, Bankers, Regulatory and Government authorities, Stock
Exchanges and business associates and all other stakeholders for their cooperation,
encouragement and continued support extended to the Company. Your Directors also wish to
place on record their appreciation to the Associates for their continuing support and
unstinting efforts in ensuring an excellent all-round operational performance at all
levels.
|
|
By Order of the Board |
|
|
For Intellect Design Arena Limited |
Place: Chennai |
Arun Jain |
|
Date: |
May 09, 2025 |
Chairman and Managing Director |
|
|
DIN:00580919 |