Alldigi Tech Ltd

Dear Shareholders,

The Board takes pleasure in presenting you the twenty fourth Annual Report of your Company for the Financial Year ended March 31, 2023.

1. Financial Performance

Key Parameters of the financial performance (Standalone and Consolidated) of the Company are as follows:

(Rs In Lakhs)

2. Business Outlook

The Company operates two business segments viz Human Resources Operations (HRO) that caters to Payroll and other HR services we provide to our clients and the Digital Business Services (DBS) business which provides voice and non-voice services to domestic and international clients. The DBS business is delivered out of India and Manila, with capability to deliver from America as well. The HRO business is largely delivered out of India and Manila.

The DBS International business has had a great year with good sales wins in the North American market and we believe that this trend will continue in the coming years as well. We have identified Healthcare as a key vertical to focus on with a key client win gaining early traction in volumes. The DBS international business has also seen expansion in some of its services like Background verification and Insurance.

The HRO business has seen growth coming from both new customer wins and organic increase in our existing customer payroll count. We crossed the significant milestone of processing more than 1.2 million monthly employee records during the current year which is a testament to our strong and scalable technology infrastructure. This has clearly established us as the No. 1 player in the Managed services business in India. Allsec manages some of the complex payroll and tax scenarios for both global and domestic organisations across industries. Our labour law and payroll compliance practice complements our payroll business & helps us provide an end-to-end solution for our customers. A quick glance on the financial highlights – At Standalone level, Profit before Tax and Exceptional Item (PBTE) stood at Rs 5,785 lakhs as compared to Rs 11,942 lakhs in the previous year. Your Company has reported Net profit after tax for the current year at Rs 4,632 lakhs as against

Rs 9,753 lakhs for the previous year.

Consolidated Revenues for the year stands at Rs 39,045 lakhs as compared to Rs 31,720 lakhs in the previous year. Consolidated Profit before Tax and Exceptional Item increased to Rs 6,454 lakhs from Rs 6,115 lakhs in the previous year. Net profit after tax stood at Rs 4,886 lakhs from Rs 3,564 lakhs in previous year. Detailed analysis of the results forms part of the Management Discussion and

Analysis (MD&A) report provided separately as part of the Annual Report.

The Company has delivery centers in India at Chennai, Bengaluru & Noida locations. On the international front Allsec has centers in Manila (Philippines) and Dallas (United States of America).

There is no change in the nature of the Company's business.

3. Reserves

The Company has not transferred any amount to the general reserves during the year under review.

4. Transfer of Unclaimed Dividend to Investor Education and Protection Fund

There is no unclaimed dividend that are outstanding for more than 7 years and therefore no amounts are required to be transferred to Investor Education and Protection Fund under Section 125(2) of the Act.

5. Dividend

Your Company declared an interim dividend of Rs 20/- per equity share on October 28, 2022. The Board does not recommend any final dividend for the year.

6. Dividend Distribution Policy

Pursuant to Regulation 43A of the Listing Regulations, the Board of Directors of the Company has formulated a Dividend Distribution Policy. The dividend, if any, to be declared in the future will be paid as per this policy depending on a number of parameters, including but not limited to the Company's profits, capital requirements, overall financial condition, contractual restrictions and other factors considered relevant by the Board. The Dividend Distribution Policy adopted by the Company is available on the Company's website which can be accessed using the link https://www.allsectech.com/ investor-information/

7. Share Capital

The paid up Equity Capital of the Company as on March 31, 2023 stood at Rs 15,23,83,260/-. During the period under review, there is no change in Share Capital of the Company.

8. Subsidiary Companies

The Company has two subsidiaries as at year end namely Allsectech Inc., USA, and Allsectech Manila Inc., Philippines.

The Consolidated Financial Statements of the Company and its subsidiaries are prepared in accordance with Indian Accounting Standards and forms an integral part of this Annual Report.

The Annual Accounts of the said subsidiaries and the related detailed information will be made available to the investors of the Company seeking such information at any point of time. In terms of Section 134 of the Act and Rule 8(1) of the Companies (Accounts) Rules, 2014, the financial position and performance of the subsidiaries are given as an annexure to the Consolidated Financial Statements.

The Company monitors performance of subsidiary companies (list of subsidiary companies has been provided in the financial statements), inter-alia, by the following means: a) Allsectech Inc, US is a material subsidiary of the Company and hence an Independent Director from your Company was appointed in Allsectech Inc as per the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. b) The Audit Committee reviews the financial statements and minutes of the subsidiary companies on a quarterly basis. c) The separate audited accounts of the subsidiary companies are placed on the website of the Company at https://www.allsectech.com/investor-information/. d) Your Company has formulated a Policy on Material Subsidiary as required under SEBI (LODR) Regulations, 2015 and the policy is hosted on the website of the Company under the web link https:// www.allsectech.com/investor-information/.

9. Significant developments / updates for the Financial Year ‘23

Withdrawal of the Scheme of Arrangement between the Company and Quess Corp Limited: During the financial year 2022-23, the Board of Directors of Quess Corp Limited and Allsec Technologies Limited, at their meeting held on 22 June 2022, after considering the recommendation and report of the Audit Committee and the Committee of Independent Directors, had approved the Scheme of Amalgamation of Allsec Technologies Limited ("Transferor Company" or "the Company") with Quess Corp Limited ("Transferee Company") and their respective Shareholders and Creditors (hereinafter referred to as the "Scheme"), subject to necessary approvals of Hon'ble NCLT and relevant Regulatory authorities.

On December 23, 2022, the Board of both Companies considered and approved the proposal of withdrawal of the Scheme under Clause 21.2 of the Scheme considering the changed market scenarios and informed to the Stock Exchanges.

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the Notes to the financial statements forming an integral part of the Annual Report.

In terms of Regulation 34 of SEBI (LODR) Regulations, 2015, the Management Discussion and Analysis Report for the year under review is presented in a separate section, forming an integral part of the Report.

The Board of Directors of your Company consists of three (3) Non-Executive Non-Independent Directors and three (3) Non-Executive Independent Directors. All the Directors of your Company have rich background of highly productive leadership and management. The details of the members of the Board is given in the Corporate Governance section of the Annual Report. a. Director retiring by rotation In accordance with the provisions of Section 152 of the Act read with rules made thereunder and the Articles of Association of the Company, Mr. Guruprasad Srinivasan (DIN:07596207), is liable to retire by rotation at the ensuing AGM and being eligible, has offered himself for re-appointment. A resolution seeking shareholders' approval for his reappointment forms part of the Notice. b. Key Managerial Personnel List of the Key Managerial Personnel served during the period under review is mentioned below :

1. Mr. Ashish Johri - Chief Executive Officer (resigned wef February 15, 2023)

2. Mr. Naozer Dalal – Chief Executive Officer (appointed wef February 16, 2023)

3. Mr. Raghunath P – Chief Financial Officer (resigned wef January 3, 2023)

4. Mr. Gaurav Mehra – Chief Financial Officer (appointed wef January 4, 2023)

5. Ms. Sripiriyadarshini – Company Secretary c. Changes in Directors & Key Managerial Personnel The Board, on the recommendation of the Nomination & Remuneration Committee approved the appointment of Mr. Kamal Pal Hoda (DIN: 09808793), as an Additional Director in the capacity of Non-Executive Non-Independent Director of the Company with effect from January 6, 2023. Approval of shareholders was accorded on March 8, 2023 through Postal Ballot. The Board, approved the appointment of Mr. Naozer Dalal, as the Chief Executive Officer of the Company with effect from February 16, 2023, on the recommendation of the NRC. The Board, approved the appointment of Mr. Gaurav Mehra, as the Chief Financial Officer of the Company with effect from January 4, 2023, on the recommendation of the NRC. Mr. N. Ravi Vishwanath resigned from his directorship with effect from January 6, 2023. Mr. Raghunath P resigned from the position of Chief Financial Officer and Mr. Ashish Johri resigned from the position of Chief Executive Officer with effect from the close of business hours of January 3, 2023 and February 15, 2023 respectively.

13. Independent Directors and Board Evaluation a. Declaration of Independence The Independent Directors of the Company have declared that they meet the criteria of independence in terms of Section 149(6) of the Companies Act, 2013, Regulation 25 of the SEBI (LODR) Regulations, 2015.

During the year under review, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission, if any, and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board/ Committees of the Company.

None of the Directors of the Company is disqualified for being appointed as Directors as specified in Section 164(2) of the Act and Rule 14(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014. b. Annual Board Evaluation Pursuant to Section 134(3) of the Companies Act, 2013 & Rule 8 of the Companies (Accounts) Rules, 2014 and the Listing Regulations, a structured questionnaire was prepared considering the various aspects of Board functioning and composition of Board committees and used to evaluate the performance of the Board. The NRC reviewed the performance of individual Directors based on the formulated criteria for performance evaluation and the Independent Directors considered / evaluated the performance of the Non-Independent Directors in a separate meeting of Independent Directors. The Board members subsequently evaluated performance of the Board, the Committees and Independent Directors as per the criteria and questionnaire developed for the purpose and the Board of Directors expressed their satisfaction with the evaluation process. c. Familiarisation Programme Your Company follows an orientation and familiarization programme through various reports / codes / internal policies for the Independent Directors with a view to update them on the

Company's policies and procedures on a regular basis. Periodic presentations are made at the Board Meetings on business and performance, long term strategy initiatives and risks involved. The details about the familiarization programme have been posted on the website of the Company under the web link https://www.allsectech.com/investor-information/

The Board of Directors acknowledges the responsibility of ensuring compliance with the provisions of Section 134(3)(c) of the Companies Act, 2013. To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements: Your Directors confirm the following that: a. In preparation of the Annual Accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; b. The Directors had 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 the Company at the end of the financial year and of the profit or loss of the Company for that period; c. The Directors had 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 the Company and for preventing and detecting fraud and other irregularities; d. The Directors had prepared the annual accounts on a going concern basis; e. Proper internal financial controls were in place and that the financial controls were adequate and were operating effectively; f. Proper systems were in place so as to ensure compliance with the provisions of all applicable laws and were adequate and operating effectively.

As stipulated under Regulation 34 of the Listing Regulations, the Business Responsibility and Sustainability Report, describing the initiatives taken by the Company from environmental, social and governance perspective forms a part of the Annual Report as ‘Annexure - A'.

16. Audit & Auditors a. Statutory Auditors

M/s. Deloitte Haskins & Sells, Chartered Accountants (Firm Reg. No.:008072S), the Statutory Auditors of the Company were appointed at the 20th Annual General Meeting held on September 30, 2019 for a period of 5 years. The Company has received necessary certificates under Sections 139 and 141 of the Companies Act, 2013, to the effect that they satisfy the conditions under the Companies Act, 2013 and the rules made thereunder for the above appointment. As required under the SEBI (LODR) Regulations 2015, the Statutory Auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

During the year under review, the Auditors have not reported to the Audit Committee any instances of fraud committed against the Company by its officers or employees under Section 143(12) of the Act and therefore no details are required to be disclosed under Section 134(3)(ca) of the Act. b. Internal Auditors The Board, on the recommendation of the Audit Committee, in its meeting held on May 14, 2022 had approved the appointment of M/s. Ernst & Young as the Internal Auditors of the Company for FY23 to conduct the audit on basis of a detailed internal audit plan which is reviewed each year in consultation with the Internal Audit Team and the Audit Committee. Internal Auditors give presentations and provide a report to the Audit Committee on a quarterly basis. The Board, on the recommendation of the Audit Committee, has re-appointed M/s. Ernst & Young as the Internal Auditors for the FY24.

c. 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, the Company has appointed M/s. Mohan Kumar & Associates, Practicing Company Secretaries to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is given as an Annexure - B and forms part of this Report. Pursuant to Regulation 24A of the Listing Regulations, a Secretarial Compliance Report for the financial year ended March 31, 2023 is annexed as ‘Annexure - C' . The Secretarial Auditor in his report has pointed out that under Rule 20 of Companies (Management and Administration) Rules, 2014 relating to the cutoff date for determining the eligibility to vote by electronic means for the Annual General Meeting held on 19^th September, 2022 to be earlier than seven (7) days. The Board of your Company herewith clarifies that the cut-off date for the AGM held on 19^th September, 2022 was determined considering the working days. The Board hereby clarifies and confirms that for future events, seven (7) calendar days shall be considered instead of working days for determining the cut-off date. d. Cost Audit Maintenance of cost records as specified by the Central Government under sub-section (1) of Section 148 of the Act, is not required by the Company and accordingly, such accounts and records are not made and maintained.

Risk Management is an integral part of the business process. Pursuant to Section 134(3)(n) of the Companies Act, 2013, the Company has developed and implemented a Risk Management Policy. The policy has been approved by the Risk Management Committee of the Company on October 28, 2021. The Policy envisages identification of risk and procedures for assessment and minimization of risk.

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to Company's policies, safeguarding of its assets, prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial disclosures. The Internal Audit is performed by an external agency and the main scope of the Audit is to test and review controls, appraisal of risks and business processes, besides benchmarking controls with best practices in the industry. Additionally the Company engages an external agency to review the internal controls on financial reporting. There are no observations from the said review.

The Company has formulated a Policy on Related Party Transactions as approved by the Board and the same is uploaded on the Company's website https://www. allsectech.com/investor-information/ All the related party transactions that were entered into by the Company during the Financial Year 2022-23, were on an arm's length basis and were in the ordinary course of business. All repetitive related party transactions placed before the Audit Committee are within the omnibus approval limits obtained in accordance with the requirements of the SEBI (LODR) Regulations, 2015. The transactions entered into pursuant to such approval are placed periodically before the Audit Committee. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel which may have a potential conflict with the interest of the Company at large. None of the Directors have any pecuniary relationships or transactions vis-?-vis the Company otherwise than disclosed in the Corporate Governance Report, forming part of this report. 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 – D' in Form AOC-2 and the same forms part of this report.

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Company's policy lays down the policy for appointment and remuneration including criteria for determining qualifications, positive attributes, and independence are provided in the Corporate Governance Report forming integral part of this Report. The policy on remuneration can be accessed at web link - https://www.allsectech.com/investor-information/

There are no Employee Stock Option Plans that is currently in vogue.

The information relating to employees to be given under Section 197(12) of the Companies Act, 2013 is given as Annexure - E.

Your Company endeavours to adopt the best prevalent Corporate Governance practices. A detailed report on Corporate Governance, pursuant to the requirements of Regulation 34 of the Listing Regulations, forms an integral part of the Annual Report. A certificate from Mr. A. Mohan Kumar, Practicing Company Secretary, Chennai, confirming compliance to conditions of Corporate Governance, as stipulated under the Listing Regulations, is annexed to the Corporate Governance Report. A statement containing additional information as required under Part II of Schedule V of the Companies Act, 2013 is provided in the Report on Corporate Governance, which forms part of this Annual Report.

In accordance with the requirements of the Companies Act, 2013; your Company has established a Vigil Mechanism / Whistle Blower Policy for Directors and Employees to report genuine concerns. The said Policy meets the requirement of the Vigil Mechanism framework under the Companies Act, 2013 and the members can view the details of the policy on https://www.allsectech. com/investor-information/. No member has been denied access to Vigil Mechanism and no complaints have been received during the year.

Since your Company is in the Information Technology Enabled Services (ITES) business, the provisions relating to conservation of energy and technology absorptions are not applicable. The details of the earnings and expenditure in foreign currency are given below:

The Board of Directors of your Company has constituted the CSR Committee to help the Company to frame, monitor and execute the CSR activities. As per Sec. 135 of the Companies Act 2013, the Board of every Company referred to in sub-section (1), shall ensure that the Company spends, in every financial year, at least 2% of the average net profits of the Company made during the three immediately preceding financial years.

As per computations made under Section 198 of the Companies Act, 2013, the Company must contribute Rs 51 lakhs as CSR Contribution. During the financial year 2022-23, the CSR Committee of the Company had a meeting on July 27, 2022 which approved the contributions made and proposed to the tune of Rs 51 Lakhs towards healthcare and education, which falls under the categories prescribed in Schedule VII of the Companies Act 2013 under (i) Eradicating hunger, poverty and malnutrition, promoting health care including preventive health care and sanitation including contribution to the Swach Bharat Kosh set-up by the Central Government for the promotion of sanitation and making available safe drinking water (ii) promoting education, including special education and employment enhancing vocational skills specially among children, women, elderly and the differently abled and livelihood enhancement project. The report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules 2014 is annexed in Annexure - F and forms an integral part of the Report. The policy has been uploaded on the Company's website at https://www.allsectech. com/investor-information/

Pursuant to the provisions of Section 118 of the Act, the Company has complied with the applicable provisions of the Secretarial Standards issued by the Institute of Company Secretaries of India ("ICSI") and notified by the Ministry of Corporate Affairs ("MCA").

Your Company has not accepted any deposits from the public during the period under review and did not have any outstanding deposits.

There were no significant and material orders passed by the Regulators, Courts or Tribunals that would impact the going concern status of the Company's operation in the future.

During the year, eight (8) meetings of the Board of Directors were held. The details of the meetings are furnished in the Corporate Governance Report that forms part of this Annual Report.

In terms of Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return in the prescribed format is available at https://www.allsectech.com/investor-information/

In order to comply with provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules framed thereunder, the Company has formulated and implemented a policy on prevention, prohibition and redressal of complaints related to sexual harassment of women at the workplace. All women employees either permanent, temporary or contractual are covered under the above policy. The said policy has been uploaded on the internal portal of the Company for information of all employees. An Internal Complaint Committee (ICC) has been set up in compliance with the said Act. During the year, the Committee has not received any complaints.

There are no material changes and commitments affecting the financial position of the Company which has happened between March 31, 2023 and May 8, 2023.

No changes during the year.

The Company has a robust Quality Management, Information Security Management system and Data Privacy framework in place to identify the potential risks, areas of improvement and further to have smooth business operations. ISO 9001:2015, Quality Management System certification for Chennai facility and ISO 27001:2013, Information Security Management System certification for all Allsec's facilities in Chennai, Bengaluru, Noida and Manila cities globally were renewed in Feb' 23 and these are valid till Feb' 24. The PCI DSS compliance certifications for DBS business are renewed in May 22 for Chennai and Manila facilities and in Jan 23 for Bengaluru and Noida facilities respectively. These are valid for 1 year period from the date of renewal. Existing SSAE 18 / ISAE 3402, SOC1, Type II which is a graduated version of SAS 70 Type II audit reporting for HRO payroll business has been performed in Q1 for one client as per their exclusive controls requirements as requested by them and also in Q2 for some clients. Overall, we perform this audit thrice in a year for different time periods of a financial year for complete payroll business to cater to different clients' requirements as a standard practice. This increased frequency makes the system more robust. To fulfil the requirements for one new US Healthcare business program launched in Manila facility this year, we got our Manila facility HIPAA certified in Oct 22. Further, we got existing HIPAA certification for Chennai facility renewed in Jan 23. HIPAA certification is mandatory if we are providing service delivery for any client that deals with US citizens / residents health information and it is an Act of US.

General Data Protection Regulation (GDPR) is a regulation in EU law on data protection & privacy for all individuals within the European Union (EU). It also addresses the requirements to be fulfilled for export of personal data from EU to outside the EU. This act is applicable to all entities which can be located anywhere in the world and have to mandatorily deploy the GDPR framework and controls if they collect or process personally identifiable information (PII) of EU citizens or those residing in EU. We established GDPR framework 4 years ago. We continued strengthening the controls and our system in line with this regulation and its periodic enhancements for the business lines where it is applicable.

Further we continued our efforts in strengthening the systems deployed to fulfil the compliance requirements of Philippines Data Privacy Act and California Consumer Privacy Act (CCPA) for the client programs where these acts are applicable.

The Company is conscious of the importance of environmentally clean and safe operations. The Company's policy requires conduct of operations in such a manner so as to ensure safety of all concerned, compliances of environmental regulations and preservation of natural resources.

Your Company will constantly endeavor to give the best possible services to the investors. Towards this end, the following are some of the initiatives taken by the Company: The investor information section of the website of the Company (www.allsectech.com), furnishes important financial details and other data of frequent reference by the investors as per Regulation 46 of SEBI (LODR) Regulations, 2015. The Company also has a Stakeholders' Relationship Committee to address shareholders' grievances if any and resolve them as & when they are reported. The Company has provided an exclusive email id: investorcontact@allsectech.com for the investors to facilitate the redressal of the queries and complaints of the investors.

The Company has appointed M/s. KFin Technologies Limited as Registrars & Share Transfer Agents for attending to issues relating to physical shares and routine services requests.

Shareholders can also address any unresolved issues or information requests by postal mail to - Company Secretary, Allsec Technologies Ltd, 46C, Velachery Main Road, Velachery, Chennai 600042.

Shareholders are requested to update their email addresses with their respective depository participants so that the Company can provide better services at all times.

Your Directors wish to place on record their appreciation for the excellent support and co-operation given by customers, shareholders, service providers and Government Agencies.

Your Directors also place on record their appreciation and gratitude to Financial Institutions, Auditors and Bankers for their continued support and timely assistance in meeting the Company's resource requirements. Your Directors acknowledge the dedicated services rendered by all the employees of the Company.

For and on behalf of the Board of Directors of Allsec Technologies Limited