IBS Hyderabad

Academic Year – 2022-23

ACCOUNTING FOR MANAGERS

Semester 1
Course Faculty: Mrs. Richa Gupta
Section: D
Topic: Analyzing, Interpreting and Drawing Conclusions from the
Annual Report of ‘Apollo Microsystems’

NAME ENROLLMENT NUMBER SEAT NUMBER

Pradyuman Kumar Yadav 22BSPHH01C0809 53
Vrinda 22BSPHH01C1357 54
Shubham Balodi 22BSPHH01C1580 55
Arushi Srivastava 22BSPHH01C0218 56

Learning Outcomes from this Group Project Task: The major learning from this project
was how to analyze a company’s annual report. We also came to know about the different
components of the financial statements, how they can be used for analysis and also draw
meaningful conclusions from them in order to make decisions in the future.
 TABLE OF CONTENTS

S.NO PARTICULARS PAGE NO.

1. INTRODUCTION 2

2. STATEMENT OF PROFIT & LOSS 3

3. BALANCE SHEET 7

4. CASH FLOW STATEMENT 9

5. OTHER REPORTS 11

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 INTRODUCTION
Apollo Micro Systems Limited (AMS) is an electronic, electromechanical and engineering design,
manufacturing and supplies company. It designs, develops and sells high‐ performance, mission and
time critical solutions to Defense, Space and Home Land Security for Ministry of Defense,
government controlled public sector undertakings and private sectors. It offers custom built COTS
(Commercially off‐the shelf) solutions based on specific requirements to defense and space
customers.

AMS continues to leverage state-of-the-art technology to develop innovative and unique solutions
that meet diverse customer requirements. Its ability to sustain in a constantly evolving business
landscape, offer ground-breaking products & solutions and strategic abilities to stay ahead of the
curve has established AMS as a trusted and reputed player in the industry.

The analysis, interpretation and conclusions have been drawn from the Company’s
Consolidated Statements. The results are as follows:

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Consolidated Statement of Profit & Loss
for the year ended 31 March, 2021

(All amounts in Indian Rupees, except share data and where otherwise stated)
PARTICULARS For the year ended 31 For the year ended
March 2021 31 March 2020

INCOME

I. Revenue from operations 2,03,07,20,827 2,45,90,41,260

II Other income 63,56,545 1,59,57,933

III Total income 2,03,71,07,183 2,47,49,99,193

IV Expenses

Cost Of Material Consumed 1,59,41,91,148 1,92,18,00,418

Changes in inventories and work in progress (8,58,36,056) (12,06,94,406)

Employee benefits expense 6,86,15,701 7,62,44,152

Depreciation expense 8,69,01,827 9,89,54,464

Finance costs 16,01,65,780 15,10,44,733

Other expenses 6,84,10,265 9,50,40,631

Total expenses 1,89,25,40,107 2,22,23,89,991

V Profit before tax and exceptional items 14,45,67,077 25,26,09,201

VI Exceptional items - -

VII Profit before tax 14,45,67,077 25,26,09,201

VIII Tax expense

Current tax 1,21,44,827 3,80,14,414

Earlier tax adjustments - 3,68,56,052

Deferred tax 2,99,14,212 3,76,25,958

Total tax expense 4,20,59,039 11,24,96,424

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IX Profit for the year 10,25,08,037 14,01,12,777

Other comprehensive income

X Items that will not be reclassified to profit

or loss:

a) Re-measurement gains/ (losses) on defined 10,10,572 (3,22,119)

benefit plan

b) Income-tax effect (2,94,279) 93,800

Other comprehensive income for the year, net of 7,16,293 (2,28,319)

tax (a+b)

Total comprehensive income (7+8) 10,32,66,030 13,98,84,459

XI Net Profit / (loss) attributable to

a) Owners of the Company 10,25,38,157 -

b) Non- controlling interest (30,120) -

XII Other Comprehensive income attributable

to

a) Owners of the Company (7,16293) -

b) Non-controlling interest

XIII Total Comprehensive income attributable - -

to

a) Owners of the Company 10,32,54,450 -

b) Non- controlling interest (30,120) -

XIV Earnings per equity share (nominal value

of INR 10) in INR

Basic 4.94 6.75

Diluted 4.94 6.75

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What is Statement of Profit and loss?

A statement of profit and loss is a financial statement that summarizes the revenue, costs, and
expenses incurred during a specified period, usually a fiscal quarter or year. It is also called
as Income statement.

1) Revenue from operations: It is defined as the Income generated by an entity from its
daily core business operations.
During FY 2020-21 revenue of the company decreased by 17.42% from Rs.245 crore in FY
2019-20 to Rs 203 crore in FY 2020-21. The decrease in sales was largely on account of
decrease in sales volume of products which decreased by 17.81% from Rs 247 crore in FY
2019-20 to Rs 203 crore in FY 2020-21. PAT declined by 26.18% from Rs 1401.12 crore in
FY 2019-20 to Rs 1025.49 crore in FY 2020-21. Sale of products in the company accounts
for 95.07% of the total revenue. Hence although as there is a slight increase in sale of
services which is 6%, the company has experienced 17.42% decrease of sales revenue for
2020-21.

2) Other Income: Other income comprises of income received as in the form of finance
income. Other income in FY2020-21 decreased to Rs.63.56 lakhs from Rs.159.57 lakhs in
FY2019-20. This is because Bank and financial institution deposits increased from lakhs in
FY2019-20 to Rs.135.36 lakhs in FY2020-21.
This led to the decrease in the Total Income from Rs.24,749.99 lakh in 2019-20 to
Rs.20,370.77 lakhs in FY2020-21.

3) Cost of materials consumed: Cost of materials consumed include:

A) Raw material consumption: This is invariably the raw material cost that the company
requires to manufacture finished goods. The consumption of raw materials decreased by
17.81% from Rs.192.18 lakhs in FY2019-20 to Rs.159.41 lakhs in FY2020-21. The increased
opening stock in FY2019-20 may be due to the unsold items in FY2019-20. Though there is a
pandemic situation in the country they somehow managed to sell off their manufactured
products to the customers.
B) Purchases of raw material: There is a decrease in purchases of raw material by 24.3%
from 206.01 lakhs in FY2019-20 to 155.94 lakhs in FY2020-21. This is due to the covid-19
impact in previous year, the company is forced to keep its unsold material in their unit.
C) Other incidental cost: There is an increase in other incidental cost by 37.96% from
Rs.915.91 lakhs in FY2019-20 to Rs 1263.60 lakhs in FY 2020-21. This is due to the
lockdown which created a rise in the costs.

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4) Change in inventories of finished goods, WIP & stock in trade: Change in the
inventory of finished goods refers to the costs of manufacturing incurred by the company in
the past, but the goods manufactured in the past were sold in the present/current financial
year. Closing stock of inventory in FY2019-20 becomes opening stock for FY2020-21 and
for both the fiscal years the change in inventory goods is in terms of negative value which
means the production of goods became more compared to selling of those goods this is due to
the pandemic situation in the country which resulted in imposing of lockdown worldwide.

5) Employee Benefit Expense: This includes expense incurred in terms of the salaries paid,
contribution to provident and other funds, gratuity, compensated absences, staff welfare
expenses. The company’s Employees benefit expenses decreased by 10% from Rs.762.44
lakhs in FY2019-20 to Rs.686.15 lakhs in FY2020-21. The decrease in expenses is due to
decrease in the number of employees which even reduced the amounts of provident fund,
gratuity expense and staff welfare expenses.

6) Financial Costs: Financial costs is interest costs and other costs that an equity pays when
it borrows funds. The company’s total financial expense increased 6.02% from Rs 151.04
lakhs in FY2019-20 to Rs 160.16 lakhs in FY 2020-21. This is mainly due to increase of bank
charges and commissions increased from Rs.151.04 lakhs in FY2019-20 to Rs.160.16 lakhs
in FY2020-21.

7) Depreciation and amortization: A tangible/intangible asset have to be depreciated over

its useful life. Useful life is defined as the period during which the asset can provide
economic benefit to the company. The depreciation of the tangible assets in FY2020-21 stood
at Rs.869.01 lakhs. This is due to the wear and tear of the company property. Right-of-use
assets are depreciated from the commencement date on a straight-line basis over the shorter
of the lease term and useful life of the underlying asset. From FY2019-20 to FY 2020-21
there is decrease in the value of plant, property and equipment from Rs 5026.14 lakhs to Rs
4856.13 lakhs.

8) Other Expenses: These expenses include Managerial remuneration, consultation charges,

Tour and travelling, printing and stationery, power and fuel, Insurance charges etc. Due to the
decrease in the number of employees, decrease in business development expenses and
decrease in other expenses resulted in the decrease of the other expenses from Rs 950 lakhs in
FY 2019-20 to Rs 684.10 lakhs in FY 2020-21 despite of increase in expenses towards
Corporate social responsibility expenses. As the sales fall in FY2020-21, the profit before tax
declined by 42.75% from Rs.2526.09 lakhs in FY2019-20 to Rs.1446.28 lakhs in FY2020-21.
This decrease in the sales for the FY2020-21 is due to the pandemic in the world.

9) Tax Expenses: Current tax items are recognized in correlation to the underlying
transaction either in OCI or directly in equity. Current income tax is measured at the amount
expected to be paid to the tax authorities in accordance with the income tac Act,1961 and

Page | 7
rules thereunder. The income tax for FY2020-21 stood at Rs 420.78 lakhs compared to
Rs.1124.96 lakhs in FY 2019-20. This is due to the decrease in company’s profit in present
financial year and also new plants have started in different states through which they might
have got tax exempt for certain period.

10) Earnings per Share: Earnings per share are computed by dividing the net profit for the
year attributable to the shareholders’ and weighted average numbers of shares outstanding
during the year. Net profit after tax attributable to shareholders decreased from Rs.4.94 per
share in FY2019-20 to Rs.6.75 per share in FY 2020-21 due to decrease in the profit when
compared to the previous year. As a result, the share price declined drastically.

Consolidated Balance Sheet

as at 31 March, 2021

(All amounts in Indian Rupees, except share data and where otherwise stated)
Particulars For the year For the year
ended (31 March ended (31 March
2021) 2020)

ASSETS

1. Non- Current assets

a) Property, plant and equipment 49,07,81,032 50,26,14,313

b) Capital work-in-progress 52,21,12,156 36,52,31,912

c) Good will 1,89,328 -

d) Other intangible assets 24,07,861 8,02,780

e) Other Non-Current assets 1,19,06,012 -

1,02,73,96,389 86,84,49,005

2 Current assets

a) Inventories 2,25,69,29,521 2,07,94,61,676

b) Financial assets

Trade receivables 1,69,49,83,804 1,35,47,91,601

Cash and cash equivalents 12,80,378 8,80,071

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Other bank balances 13,27,30,291 12,38,83,795

Loans 13,60,721 19,47,946

c) Other current assets 20,30,16,417 22,15,53,755

4,29,03,01,133 3,78,25,18,843

TOTAL ASSETS 5,31,76,97,522 4,65,11,67,848

EQUITY AND LIABILITIES

1. EQUITY

Equity share capital 20,76,38,860 20,75,88,860

Other equity 2,84,44,35,728 2,27,15,63,221

Equity Attributable to Owners of the Company 3,05,20,74,588 2,95,91,52081

Non- Controlling Interest 72,53,056 -

Total equity 3,05,93,27,644 2,95,91,52,081

LIABILITIES

2. Non- Current liabilities

a) Financial Liabilities

i) Borrowings 26,85,880 88,591

b) Deferred tax liabilities, net 16,21,80,051 13,19,71,561

c) Provisions 82,91,436 73,65,699

Total Non-Current Liabilities 17,31,57,367 13,94,25,851

3. Current liabilities

a) Financial Liabilities

i) Borrowings 1,16,06,72,086 82,82,42,375

ii) Trade Payables:

- total outstanding dues of micro enterprises and - -

small enterprises

- total outstanding dues of creditors other than 78,29,80,835 56,93,62,672

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micro enterprises and small enterprises

iii) Other financial liabilities 7,33,61,217 7,82,94,980

b) Other current liabilities 2,69,73,041 1,43,74,796

c) Current tax liabilities, net 4,02,60,706 5,98,70,466

d) Provisions 9,64,625 24,44,626

TOTAL LIABILITIES 2,08,52,12,510 1,55,25,89,916

TOTAL EQUITY AND LIABILITIES 5,31,76,97,522 4,65,11,67,848

What is a Balance Sheet?

The balance sheet displays the company’s total assets and how the assets are financed, either
through either debt or equity. It can also be referred to as a statement of net worth or a
statement of financial position. The balance sheet is based on the fundamental
equation: Assets = Liabilities + Equity.

ASSETS
Non-current assets are a company’s long-term investments that have a useful life of more
than one year.

• We can see that there is a fall in the percentage of non-current assets like Properties,
Plant, and Equipment.
• We also see a substantial increase in the amount of Capital work-in-progress and
other intangible assets.
• It might have acquired or merged with some company, and so goodwill and other
non-current assets came into the picture in the year 2021.
• Overall, we see an increase in the non-current assets.

Current assets are resources that are expected to be used up in the current accounting period
or the next 12 months.

• We can see that there is an increase in the percentage of Inventories, Trade

Receivables, Cash and Cash Equivalents, and other Bank balances.
• We also see a decrease in the percentage of loans given and other current assets.
• Overall, we see an increase in the current assets and also in the total value of assets.

EQUITY & LIABILITIES

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Owner’s Equity is defined as the proportion of the total value of a company’s assets that can
be claimed by its owners and by its shareholders.

• We see that there is a slight change in the equity share capital.

• We see an increase in the percentage of other equity and Equity Attributable to
Owners of the Company as well.
• Non-Controlling Interest can be described as the minority ownership of one business
in another business. A business is said to have a non-controlling interest in another
business if the shareholder of that particular company owns less than 50% of the
outstanding shares of the company.
• We see that non-controlling interest comes into the picture in the year 2021.
• Overall, we see a very slight change in the value of Total Equity.

Non-current liabilities are long-term finances that become due beyond twelve months in
the future.

• We see a substantial increase in Long-term borrowings and Deferred Tax Liabilities.

• We also see an increase in the percentage of provisions over the year.
• Overall, we see a substantial increase in the total non-current liabilities.

Current liabilities are short-term debts with maturity dates within the following twelve-
month period.

• We see a huge rise in the percentage of Short-term borrowings.

• We also see an increase in the percentage of total outstanding dues of creditors and
other current liabilities.
• We see a decrease in the percentage of other financial liabilities, current tax liabilities,
and provisions.
• Overall, we see an increase in the total amount of liabilities and also in the total
amount of Equity and Liabilities.

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Consolidated Statement of Cash Flows
for the year ended 31 March, 2021

(All amounts in Indian Rupees, except share data and where otherwise stated)
Particulars For the year For the year
ended 31 ended 31 March
March 2021 2020

I. Cash flows from operating activities

Profit before tax 14,45,67,077 25,26,09,201

Adjustments to reconcile profit before tax to net cash

flows:

Depreciation of tangible assets 8,69,01,827 9,89,54,464

Finance income (including fair value change in financial (63,86,356) (1,59,57,933)

instruments)

Finance costs (including fair value change in financial 16,01,68,471 15,10,44,733

instruments)

Re-measurement gains on defined benefit plans 10,10,572 (3,22,119)

Operating profit before working capital changes 38,62,61,590 48,63,28,347

Changes in working capital:

Adjustment for (increase)/decrease in operating asset

Trade receivables (34,01,92,204) 33,83,61,660

Inventories (17,74,67,845) (35,06,54,932)

Loans - current 5,87,225 73,12,523

Other assets - current 1,85,37,338 (11,39,10,102)

Other assets - non current - -

Adjustment for (increase)/decrease in operating liabilities

Trade payables 21,07,18,860 19,90,54,647

Other financial liabilities - current (49,33,763) (3,94,86,853)

Other current liabilities 1,25,98,245 (22,23,825)

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Provisions (5,54,264) 22,83,558

Cash generated from operations 10,55,55,182 52,70,65,022

Income taxes paid (3,17,54,589) (5,79,58,385)

Net cash generated from/ (used in) operating activities 7,38,00,593 46,91,06,638

II. Cash flows from investing activities

Purchase of property, plant and equipment (including (23,61,10,117) (26,60,71,491)

capital work in progress)

(Investments in)/ redemption of bank deposits (having (88,46,496) 6,32,47,683

original maturity of more than three months) - net

Interest received (finance income) 63,86,356 1,59,57,933

Net cash used in investing activities (23,85,70,257) (18,68,65,875)

III. Cash flows from financing activities

Share issue proceeds 8,31,200 -

Dividend Paid (1,03,81,943) -

(Repayment) /Proceeds from borrowings, net 33,48,66,038 (20,92,58,934)

Interest paid (16,01,68,471) (15,10,44,733)

Net cash provided by financing activities 16,51,46,824 (36,03,03,668)

Net increase in cash and cash equivalents (I+II+III) 3,77,160 (7,80,62,905)

Cash and cash equivalents at the beginning of the year 9,03,218 7,89,42,976

Cash and cash equivalents at the end of the year (refer 12,80,378 8,80,071
note below)

Note:

Cash and cash equivalents comprise:

Cash on hand 10,86,975 5,55,806

Balances with banks:

- in current accounts 1,93,403 3,24,265

12,80,378 8,80,071

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What is a Cash Flow statement?

A Cash Flow Statement is one of the most important financial statements which reports the
cash generated and spent during a specific period of time (e.g., a month, quarter or year). The
statement of cash flows acts as a bridge between the income statement and balance sheet by
showing how money moved in and out of the business. AS-3 /Ind AS 7 deals with the
preparation of the cash flow statement.

The following can be interpreted from the Cash Flow Statement of Apollo Microsystems:

1) Cash Flow from Operating Activities

Cash flows from operating activities is a section of a company's cash flow statement that
explains the sources and uses of cash from ongoing regular business activities in a given
period. This typically includes net income from the income statement, adjustments to net
income and changes in working capital.

A) Profit before exceptional item and tax:

An exceptional item is a charge incurred by a company that must be noted separately in its
financial report in accordance with Generally Accepted Accounting Principles (GAAP).
Despite the name, such items are considered to be ordinary business charges but they must be
separated out for the sake of financial reporting clarity.

The difference between Profit before exceptional item and tax of 2020 and 2021 is positive,
i.e., Rs. 10,80,42,124 because due to COVID the profits earned by company was less in the
year 2021 i.e., Rs. 14,45,67,077 as compared in the year 2020 i.e., Rs. 25,26,09,201.

B) Adjustment for Depreciation:

Depreciation is a non-cash expense, which means that it needs to be added back to the cash
flow statement in the operating activities section, alongside other expenses such as
amortization and depletion.

In the year 2020, Depreciation and amortization expense is Rs. 9,89,54,464 and in the year
2021 it has come down to Rs. 8,69,01,827. In the year 2021, it is less than the year 2020. It
has an indirect effect on the cash flow and on the cash that has to be paid as tax by the
company.

C) Finance Income:

There was a slowdown in the economy following the nationwide lockdown. The Reserve
Bank of India (RBI) announced a number of measures to provide relief to the affected people.
Also, they cut key policy rates, viz repo rate, reverse repo rate, and the Cash Reserve Ratio
(CRR). So, keeping this explanation in mind the finance income for the year 2021 and 2020
was negative.

D) Finance Cost:

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Financing cost (FC), also known as the cost of finances (COF), is the cost, interest, and other
charges involved in the borrowing of money to build or purchase assets. This can range from
the cost it takes to finance a mortgage on a house, to finance a car loan through a bank, or to
finance a student loan.

Finance cost is more in the year 2021, i.e., Rs. 16,01,68,471 and Rs. 15,10,44,733 in 2020.
We can see an increase in price of finance cost because in the year 2021, companies were
struggling to pay money due to lack of savings so they were borrowing money from banks to
repay their loans or purchase raw materials or anything, so there is an increase in the finance
costs in the year 2021 than 2020.

E) Re-measurement gains on defined benefit plans:

Defined benefit plans provide a fixed, pre-established benefit for employees at retirement.
Employees often value the fixed benefit provided by this type of plan. On the employer side,
businesses can generally contribute (and therefore deduct) more each year than in defined
contribution plans.

Re- measurement gains were less in 2020 i.e., (3,22,119) and increased to 2021 i.e.,
10,10,572 which means employees were given more benefits in 2021 as they worked from
home during Covid times.

G) Operating Profit before working capital changes:

Operating profit before working capital changes is Rs. 38,62,61,590 for the year 2021 and Rs.
48,63,28,347 for the year of 2020.

H) Adjustment for Working Capital Changes

The following are the working capital changes in the cash flow statement:

▪ Trade receivables: In the year 2021 we can see that the trade receivables are negative
i.e., Rs. 34,01,92,204 and for the year 2020 it is positive. The COVID-19 outbreak
lead to a significant increase in the loss rate for trade receivables.

▪ Inventories: We can see that the inventories for both the years, 2021 and 2020 is
negative i.e., the company Apollo Microsystems was not able to recover the cost they
invested in inventories in both the years. The company has also invested less in
inventories in 2021 as compared to 2020.

▪ Loans (Current): The loans have decreased from 2020 i.e., Rs. 73,12,523 to 2021 i.e.,
Rs. 5,87,225 indicating that the company have given less of loans to other companies.

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 ▪ Other Assets (Current): The other current assets were negative in 2020 i.e., Rs.
(11,39,10,102) and positive in 2021 i.e., Rs. 1,85,37,338. This means the company
have more prepaid expenses and other assets as compared to previous year.

▪ Trade Payables: Trade Payables have increased from 2020 i.e., Rs. 19,90,54,647 to
Rs. 21,07,18,860 in 2021. This indicates that the company owes more money to the
creditors in 2021 than in 2020.

▪ Other Current Liabilities: The other current liabilities like outstanding expenses have
gone from negative in 2020 i.e. (22,23,825) to positive in 2021 i.e., Rs.1,25,98,245.
This shows that the company has outstanding expenses and need to pay them.

▪ Provisions: The amount of provisions has reduced from 2020 i.e., Rs. 22,83,558 in
2020 to Rs. (5,54,264). This means the company has put in less amount in the
provisions for this year.

▪ Tax Paid: The taxes paid have reduced from 2020 to 2021. The cash generated from
Operating activities before tax is less in 2021 so the tax paid is also less.

THE CASH GENERATED FROM FINANCING ACTIVITIES HAS INCREASED FROM

2020 i.e., Rs. (36,03,03,668) TO 2021 i.e., Rs. 7,38,00,593. IT IS CASH INFLOW.

2) Cash Flow from Investing Activities

Cash flow from investing activities is the cash that has been generated (or spent) on non-
current assets that are intended to produce a profit in the future. Types of activities that this
may include are capital expenditures, lending money and sale of investment securities.

• Purchase of property, plant and equipment (including capital work in progress) has
reduced from Rs. (26,60,71,491) in 2020 to Rs. (23,61,10,117). It is negative because
it is cash outflow. The reduced amount shows that the company has invested less in
plant and machinery in 2021.
• (Investments in)/ redemption of bank deposits (having original maturity of more than
three months) – net has reduced from Rs. 6,32,47,683 in 2020 to a negative of Rs.
(88,46,496) in 2021. It means the company has invested more in the year 2021 and
has redeemed bank deposits in 2020.
• Interest received has reduced from Rs. 1,59,57,933 in 2020 to Rs. 63,86,356 in 2021.
This means the company has not invested much in the year 2021.

THE CASH SPENT ON INVESTING ACTIVITIES HAS INCREASED FROM 2020

i.e., Rs. (18,68,65,875) TO 2021 i.e., Rs. (23,85,70,257). IT IS CASH OUTFLOW.

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3) Cash Flow from Financing Activities

Cash flow from financing activities (CFF) is a section of a company's cash flow statement,
which shows the net flows of cash that are used to fund the company. Financing activities
include transactions involving debt, equity, and dividends.

• Share issue proceeds is Rs. 8,31,200 in 2021. This means the company has issued
shares in the year 2021 for the general public.
• Dividend Paid on the issued shares is Rs. (1,03,81,943) in the year 2021. It is cash
outflow.
• (Repayment) /Proceeds from borrowings, net is Rs. (20,92,58,934) in 2020. This
means the company has paid this amount worth of borrowings in 2020. In 2021 the
company has borrowed money worth Rs. 33,48,66,038.
• Interest paid has increased from Rs. (15,10,44,733) in 2020 to Rs. (16,01,68,471) in
2021.

THE CASH SPENT ON INVESTING ACTIVITIES HAS INCREASED FROM 2020 i.e.,
Rs. (18,68,65,875) TO 2021 i.e., Rs. 16,51,46,824. IT IS CASH INFLOW FOR 2021 AND
OUTFLOW FOR 2020.

Other Reports

Management Discussion and Analysis Report

Management discussion and analysis (MD&A) is a section of a public company’s annual

report or quarterly filing. The MD&A addresses the company’s performance with qualitative
and quantitative measures.

• The positive growth is expected to continue on the back of greater demand for
solution services and electronic components and devices as countries around the
world adapt remote and contactless technologies in a bid to stop the spread of Covid-
19.
• Electronics manufacturing is expected to increase at annual rate of 30% between
2020-25 and clock Rs.1.15 lakh crore additional production during this period.
• The ecosystem for large scale manufacturing is emerging and Government of India is
also encouraging such initiatives by companies by introducing PLI schemes. It is also
welcoming gesture that Indian Govt is looking forward to release a special PLI
scheme for MSME sector, which would further enhance the potential and unlock the
opportunities in Indian ESDM Sector.
• Policy Support to promote Electronics Manufacturing and initiatives such as “Make in
India”, “Digital India” as well as skill development programs. Introduction of PLI
scheme by Government of India for large scale manufacturers in various sectors and

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 especially ESDM sector is also a big growth driver in years to come to unlock the
opportunities which are untapped or unexplored for long period.
• India’s aerospace and defense industry is expected to consume electronics worth US$
70-72 billion in the next decade, demand for electronics worth US$ 17-18 billion is
expected from projects that are traditionally called system-of-systems (non-platform
based) applications.

Board Director’s Report

Director’s report is a financial disclosure made by director to the shareholders of the

company. It is envisaged to disclose financial status of the company by disclosing company’s
affairs and scope of work along with its subsidiaries. It is basically financial summary of the
company for the whole financial year and future vision too.

• The revenue from operations is Rs 2,03,07,20,827/- against Rs 2,45,90,41,260/- in the

previous year. The Earnings Before Interest, Tax, Depreciation & Amortization
(“EBITDA”) has been reduced by Rs 22.07% to Rs 39,16,96,314/- against Rs
50,26,08,398/- in the previous year.
• The Profit before Tax (“PBT”) for the year under review is Rs 14,46,28,707/- as
against Rs 25,26,09,201/- in the previous year. The Net profit of the Company for the
year under review has been reduced by 26.81% to Rs 10,25,49,737/- against Rs
14,01,12,777/- in the previous year
• The Earning per Share (“EPS”) of the Company for the year under review is Rs 4.94/-
per share basic& diluted.
• The revenue from operations is Rs 2,03,07,20,827/-. The Earnings Before Interest,
Tax, Depreciation & Amortization (“EBITDA”) is Rs 39,16,37,371/-. The Profit
before Tax (“PBT”) for the year under review is Rs 14,45,67,074/-. The Net profit of
the Company for the year under review is Rs 10,25,08,034/-
• The Earning per Share (“EPS”) of the Company for the year under review is Rs 4.94/-
per share basic & diluted. There was no consolidation of accounts for the financial
year 2019-20.

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Corporate Governance Report

Corporate governance reports reflect how corporations monitor the actions, policies, practices
and decisions of the corporation, as well as the effect of their actions on their agents and
affected stakeholders.

• The Board currently comprises of 6 (six) Directors. The Chairman of the Company is
Non- Executive Independent Director. Out of the total strength, 2 (two) (i.e., 1/3rd)
are Non- Executive Independent Directors (including one-woman Independent
Director). The composition of the Board of Directors of the Company is in conformity
with the SEBI (LODR) Regulations, 2015 and the Companies Act, 2013 (‘the Act’).
• Board Committees has been constituted as per the requirement of the Companies Act
2013 and SEBI (LODR). Committees of the Board are Audit Committee, Nomination
and Remuneration Committee, Stakeholders Relationship Committee, Corporate
Social Responsibility Committee, Risk Management Committee and Executive
Committee of Board of Directors and CFO.
• In compliance with Regulation 17 of the SEBI (LODR) Regulations, 2015 and the
Companies Act, 2013, the Company has formulated and adopted Code of Conduct for
its Board of Directors and Senior Management Personnel and has put the same on the
company’s website www.apollo-micro.com under the section “Investors”

Auditor’s Report

An auditor's report is a written letter from the auditor containing their opinion on whether a
company's financial statements comply with generally accepted accounting principles
(GAAP) and are free from material misstatement.

• Company have perused the terms of Export Obligation under Zero Duty EPCG
Scheme. Company have also verified the amount of duty exemption availed under the
scheme
• They have also verified the value and the period with in which export obligation to be
fulfilled and extension of period approved by the Regulatory Authority.
• They have also evaluated the significant judgment made by the management in its
ability to perform the export obligations with in the period permitted for making
provision as per requirement.
• The management expressed their proposals to have a quarterly review from next
financial year for any likelihood and magnitude of any liability to be provided. The
management also agreed to review and provide for during next financial year

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