ANNUAL REPORT 2019 HEXAWARE TECHNOLOGIES LIMITED Raising the bar in Transforming Customer Experiences Contents Look out for these Corporate Overview 002-030 throughout the report We are Hexaware 002 Message from the Chairman 004 1 CEO Statement 006 Reference to other Message from the Chief Financial Officer 008 pages within the report Raising The Bar 010 Board of Directors 012 The Management Team 013 Financial Highlights 014 Banking & Financial Services 015 Scan QR code to see For more details log on to Healthcare & Insurance 016 annual report online www.hexaware.com Hi-Tech & Professional Services 018 Travel & Transportation 020 Manufacturing & Consumer 021 Awards for Excellence 022 Transforming IT Services 023 A Responsible Corporate 024 Life @ Hexaware 026 Our Performance Scorecard 030 Statutory Reports 031-128 Notice 031 Directors’ Report 044 Business Responsibility Report 078 Corporate Governance Report 086 Management Discussion & Analysis 108 About Cover The cover design represents how Hexaware is ‘Raising the bar’ in transforming customer Financial Statements 129-212 experiences with the acquisition of Mobiquity Inc. in addition to its capabilities to grow across service Consolidated Financial Statements 129 offerings. The multiplication and the addition sign Standalone Financial Statements 173 symbolise the theme of transformation underlying its aspirations to reach the next level. Experiences lay foundations for aspirations. It is the key to success, leading through unexplored pathways, colouring your imagination in myriad hues and charting a roadmap for greater achievements. Are you ready to experience change? To thrive and succeed Harnessing the power of Here we go! in a fast paced world, automation, we are concentrating our reliance on a flexible on the creation of swift and and agile platform is scalable platforms that can assist Riding on more of a necessity than human-machine collaborations in a luxury. Facilitating the finest possible way. Leveraging the power of Big Data, Artificial seamless interactions Automation Intelligence and Blockchain, we are through automated systematically aiming to empower and Cloud processes leads to better enterprises with processes that will output, every time. And lead to next-level changes designed eventually, it helps to to completely Transform Customer Computing. explore truly incredible Experiences™. experiences. And we are joining the dots to Automate Everything™, Cloudify Everything™ & Transform Customer Experiences™. Annual Report 2019 Hexaware Technologies Limited We are Hexaware Since 1992, with a strong global presence, we are one of the fastest growing IT services companies in the world. We constantly strive to delight our customers with next-generation emerging technologies and innovative solutions that empower them to succeed in a dynamic digital ecosystem. Our strategic objective is to deliver digital transformative solutions Our vision Our mission to our customers To amplify To Transform how IT underpinned by our three strategic pillars human potential Services are delivered using digital and to be the first IT technologies services company in the world where half the Automate workforce is digital Everything TM Core Values Cloudify Everything TM Disruptive Highly Passionate Transform Customer Experiences TM Cool Fearless Attitude Anchored in the Past 002 Corporate Statutory Financial Overview Reports Statements POWERING HUMAN MACHINE 10 COLLABORATION Our brand reflects the progressive change that we are embracing with automation, innovation and artificial intelligence. Our logo symbolises ‘Powering Human- 34 50% 250+ Offices around Digital workforce Customer base Machine Collaboration’. the globe goal The colors of blue, yellow and red evoke our rich legacy, pulsating energy and 19,999 H9,987 Crore fearlessness. Employees as on Market Capitalisation as on 31 December 2019 31 December 2019 Multi-lingual Services offered in over a dozen languages to a wide customer base 003 Annual Report 2019 Hexaware Technologies Limited Message from the Chairman WE REMAIN ONE OF THE FASTEST GROWING IT SERVICES Atul Nishar COMPANY Chairman 004 Corporate Statutory Financial Overview Reports Statements from being a cost-effective back office Dear Shareholders, task to an advanced arena, driving digital 75.6% transformations for leading companies Americas It gives me great pleasure to report that across the globe. Hexaware recorded yet another year of sustained performance in FY 2019. The In the recent past, global enterprises Geography- Company closed the fiscal with significant have rapidly adopted digital technologies. wise improvements in revenues, profitability In a fast paced and ultra-competitive Revenue and margins. The results demonstrate the business environment, possessing the best Company’s excellent execution capabilities technology to deliver optimum performance and tireless efforts to achieve excellence. is critical to business success and sustainability. While the Covid-19 crisis has Performance overview challenged every aspect of our customer’s business, it strongly reinforces our belief Amidst a volatile global economy, the 9.1% 15.3% in the role that technology can play as we strong double-digit growth in topline, APAC Europe move ahead. The emerging technologies sustained profitability and healthy margins like AI, ML, Robotic Automation, IoT and validate Hexaware’s strong business model. AR, among others have helped enterprises We remain one of the fastest growing IT improve productivity, monitor performance, services company, adopting varied routes Mobiquity helps us derive synergies to automate processes and reduce costs. to digitalization, from process automation explore opportunities for new and existing These technologies when combined with to cloud related solutions. At Hexaware, we customers. an innovative approach help organizations offer a vast range of technologically superior to bring about transformational changes solutions that play a pivotal role to enable In addition we continue to widen our to their legacy-based business model. enhanced customer experiences. Our ability presence across the globe. We strive to be With organizations now under tremendous to offer innovation through automation a leader in digital transformation, offering pressure to transform, the role of these to more than 263 clients across different innovative and customized solutions that emerging technologies becomes more vital industries in over 30 countries, truly makes create significant value for our customers. than ever. us a global company and among the leading I wish to express my regards and IT outsourcing companies in Asia. appreciation for all our stakeholders Raising the bar including my fellow Board members, Industry review As digital transformation continues to management team, employees, customers change the operating landscape of several As the global IT industry continues and partners, for their continuous support. industries, we remain in the forefront with to grow steadily, the Indian IT service I am confident that, with our sustained our strategies of – Automate Everything sector continues to be one of the biggest commitment and efforts, Hexaware is TM, Cloudify Everything TM and Transform contributors of the GDP and export perfectly positioned to grow and create Customer Experiences TM. We further revenues. Worldwide IT spending has sustainable value for all. strengthened our Customer Experience been experiencing headwinds primarily strategy with the acquisition of Mobiquity led by the pandemic. However, in the long Inc. a leading digital consultancy. By run the sector will continue to sustain job innovating meaningful digital solutions Atul Nishar creation, direct and indirect, having matured to Transform Customer Experiences™, Chairman 005 Annual Report 2019 Hexaware Technologies Limited CEO Statement AFTER YEARS OF PATIENTLY Dear Shareholders, ACCUMULATING CAPITAL, 2019 was a landmark year for us. After years of patiently accumulating capital, we put it to great work in the form of acquiring WE PUT IT TO GREAT WORK Mobiquity Inc. Every hypothesis we had for the acquisition has been proven true so far, IN THE FORM OF ACQUIRING and we believe it will be a critical driver of growth for years to come. MOBIQUITY INC. The acquisition was not an isolated action. We are continuously strengthening our R. Srikrishna capabilities in our core strategy of Automate Chief Executive EverythingTM, Cloudify EverythingTM and Officer Transform Customer ExperiencesTM. In each of these areas we have built substantial depth, partnerships and people skills. We built the first versions of our now patent pending product AmazeTM and tested it with great success with the initial set of customers. AmazeTM helps replatform applications to the cloud with 60-75% of cost and time savings over traditional approaches by using next generation automation. Much of our market share growth was powered by Automation enabling us to displace larger legacy players in many of our customers. Aside from the acquisition, for Transform Customer Experience, we invested significantly in building capabilities organically in areas complementary to Mobiquity. The war for talent continued to be fierce. The most sustainable way of winning this war is to create talent. We are investing substantially in talent creation and cultural transformation. Over 60% of our employees are in a journey to digital reskilling and we expect close to 100% to be in this journey by end of this year. Own Your Game is a cultural