Contents Corporate Information 2 Awards of Excellence 3 Letter to Shareholders 4 Board’s Report 5 Corporate Governance Report 46 Management Discussion and Analysis 65 Business Responsibility Report 76 Standalone Financial Statements 86 Consolidated Financial Statements 153 Annual Report 2019-20 Annual Report 2019-20 CORPORATE INFORMATION Board of Directors: Committees: Mrs. Radhika Roy Audit Committee Executive Co-Chairperson Mr. Kaushik Dutta - Chairperson Mr. John Martin O’Loan Ms. Indrani Roy Dr. Prannoy Roy Executive Co-Chairperson Nomination & Remuneration Committee Ms. Indrani Roy - Chairperson Mr. Kaushik Dutta Dr. Prannoy Roy Non-Executive Independent Director Mr. Kaushik Dutta Mr. John Martin O’Loan Mr. John Martin O’Loan Non-Executive Independent Director Stakeholders’ Relationship Committee Ms. Indrani Roy-Chairperson Ms. Indrani Roy Mrs. Radhika Roy Non-Executive Independent Director Dr. Prannoy Roy Mr. Darius Taraporvala Corporate Social Responsibility Committee Non-Executive Non-Independent Director Dr. Prannoy Roy- Chairperson Mrs. Radhika Roy Key Managerial Personnel: Ms. Indrani Roy Mr. Rajneesh Gupta Chief Financial Officer Mr. Shiv Ram Singh Company Secretary & Compliance Officer Statutory Auditors: B S R & Associates LLP, Chartered Accountants, Building No.10, 8th Floor, Tower B, DLF Cyber City, Phase - II, Gurugram -122002 Phone: +91 124 2358 610 Fax: +91 124 2358 613 Registered Office: B-50 A, 2nd Floor, Archana Complex, Greater Kailash-I, New Delhi-110048 Phone: +91 11 - 4157 7777, 2644 6666 Fax: +91 11 - 49862990 E-mail: [email protected]; Web: www.ndtv.com 2 | Corporate information Corporate Information | 2 Annual Report 2019-20 Annual Report 2019-20 Awards of Excellence: 2019 - 20 NDTV has won major awards this year for its free and fair journalism: • Proving its premium status, NDTV was awarded ‘India’s Most-Trusted News Broadcaster 2019’ (India Region). The award was given by The International Brand Consulting Company, USA. This is the second time that NDTV has won this award; • The Ramon Magsaysay Award: “Harnessing journalism to give voice to the voiceless” - won by Ravish Kumar; • First Gauri Lankesh Memorial Award: For sharp news analysis and uncompromising secular stance – won by Ravish Kumar; • Indian Television Academy (ITA) award in the Best News/Current Affairs category for his daily show Primetime – awarded to Ravish Kumar; • ENBA award (Silver Trophy) in the Best News coverage category for reporting on the Western Rajasthan drought – won by Ravish Ranjan Shukla; • Sunaina’s Story: Winner, Best News Programme, Asian Television Awards 2019; • Sunaina’s Story: Gold winner, TV News Programming, Afaqs MI Award; • Nidhi Razdan’s ‘expose of conspiracy’ in the Kathua rape and murder case: Jury’s Unanimous Choice at the International Press Institute (IPI) Awards 2019; • Ambika Anand: Winner, Best Fashion and Lifestyle Show, Indian Television Awards 2019; • Sonal Mehrotra: Winner, Young Professional of The Year, exchange4media News Broadcasting Awards (ENBA) 2019; • The NDTV Dialogues (Sonia Singh): Runner-Up, Best Talk Show English, ENBA Awards 2019; • Truth vs Hype (Sreenivasan Jain): Runner-Up, Best In-Depth Series, English, ENBA Awards 2019; • Sunaina’s Story: Finalist, Best Current Affairs Programme, English, ENBA Awards 2019. 3 | Awards of Excellence Awards of Excellence | 3 Annual Report 2019-20 Annual Report 2019-20 Dear Shareholders, As always, you are the foundation of our strength, courage and determination to provide free and fair journalism. This is a challenging time for the media, as is being reported every day. Nevertheless, we are so proud to be able to report to you that your company has, for the second year in a row, been profitable. As your NDTV recovers its financial strength, building on the careful gains of the last two years, it has been able to substantially reduce its bank debt. Operating efficiencies, as well as a very controlled and diligent approach to spending, have combined to allow your Company seven profitable quarters of the last eight. Our consolidated results for the NDTV Group also show a marked improvement over earlier years. NDTV continues to be respected, admired and followed for its integrity and its commitment to impartial news. At the start of the year, NDTV reiterated its credo of No Hate-For-Profit: it will never promote communalism or divisiveness in a tawdry attempt to get eyeballs. This mission statement was promoted on our channels and on our hoardings in different cities. Now, the world has adopted a movement to shun news that peddles Hate-For-Profit. In America and other countries, viewers are asking advertisers to shun any news platform that is guilty of Hate-For-Profit. And advertisers abroad are finally listening. Your Company is so proud to have taken the lead on this in India; we hope advertisers here too will listen to viewers’ requests to support news that is not toxic. Similarly, five years ago, NDTV declared it would not run any ads for fairness creams because they promote discriminatory and regressive values. Now, companies that make these creams have announced they will no longer do so. All this proves your Company is guided by values that are worth fighting for. With your support, we operate with principles that focus on equality, unity, and appreciation - and not just tolerance - of diversity. So many of these values are embodied in our Ravish Kumar, who, in September was awarded the Magsaysay Award for his journalism and for “giving voice to the voiceless”. Ravish’s voice, literally and through his work, is inimitable. He has withstood threats and much more as he dives fearlessly everyday into uncovering the real stories of India - ones that you won’t find on other channels but that are essential and are shaping who we are as a country and what we stand for. We know you are as proud of Ravish as we are. This year saw the arrival of Coronavirus. With great speed and responsibility, NDTV provided all employees with a safe working environment with new processes that ensured social distancing. For business, too, quick changes were introduced to ensure that the lockdown and the bruised economy would not force the Company into losses at the end of the year. Details of these changes are in this report. While it is impossible to predict when advertising may return to pre-Covid levels, please know that we are working our hardest to insulate the Company from any adverse economic impact trigged by this unprecedented pandemic. Other challenges confronting us include cash flow constraints and the need to continue consolidating our operations to focus only on our core business, which we have been working on. The next year will be an enormous test of all businesses in India. We know that with your backing and collective grit, and the courage of our convictions, we will navigate a difficult period while upholding the journalism that has repeatedly seen your company awarded “Most-Trusted Broadcaster”. We would also like to thank every single member of NDTV, young and not so young, experienced or new, for raising the standard of journalism in India and for being, at all times, brave truth-seekers. Radhika Roy and Prannoy Roy (Executive Co-Chairpersons) 4 | Letter to Shareholder Letter to Shareholders | 4 Annual Report 2019-20 Board’s Report Board’s Report | 5 Annual Report 2019-20 BOARD’S REPORT Dear Members, The Board of Directors is pleased to present the 32nd Annual Report along with the annual audited financial statements (standalone and consolidated) of the Company for the financial year ended March 31, 2020. FINANCIAL PERFORMANCE (Rs. in million) Particulars Standalone Consolidated Year ended March 31, March 31, March 31, March 31, 2020 2019 2020 2019 Revenue from Operations 2,223.33 2,515.35 3,731.66 3,987.33 Other Income 195.12 226.88 197.95 236.29 Profit/Loss before Depreciation, Finance Costs, 378.82 435.07 725.79 724.27 Exceptional items and Tax Expense Less: Depreciation/ Amortisation/ Impairment 85.12 94.90 108.16 119.16 Profit /Loss before Finance Costs, Exceptional 293.70 340.17 617.63 605.11 items and Tax Expense Less: Finance Costs 163.37 167.02 248.65 278.79 Profit /Loss before Exceptional items and Tax 130.33 173.15 368.98 326.32 Expense Add/(less): Exceptional items - 40.00 - 40.00 Share of Profit/(loss) of equity accounted investees - - -13.90 -80.77 Profit /Loss before Tax Expense 130.33 133.15 355.08 205.55 Less: Tax Expense (Current & Deferred) - - 75.81 91.89 Profit /loss for the year (1) 130.33 133.15 279.27 113.66 Remeasurement of defined benefit obligations (2) -15.35 -16.84 -18.23 -18.25 Total (1+2) 114.98 116.31 261.04 95.41 Non-controlling interest - - 36.97 11.34 Other comprehensive income is attributable to: Non-controlling interest - - -0.66 0.12 Profit /(Loss) for the year carried to Reserves and 114.98 116.31 224.73 83.95 Surplus Balance of profit /Loss for earlier years -3,027.09 -3,143.40 -3,421.26 -3,779.14 Adjustment on transition to IND AS 115 - - - -2.39 Adjustment on transition to new tax rate - - -0.13 - Adjustment on account of surrender of share based - - - 130.48 awards Transfer of share based payment reserve to - - - 154.64 retained earnings Adjustment due to loss of control - - - -8.80 Balance carried forward -2,912.11 -3,027.09 -3,196.66 -3,421.26 During the financial year under review, your company recorded a net profit of Rs. 130.33 million as compared to a net profit of Rs. 133.15 million in the previous year (on standalone basis). The total income of the Company (on standalone basis) reduced by 11.81% to Rs. 2,418.45 million as compared to the total income of Rs.