policy on directors appointment and remuneration

216 Pages·2017·12.17 MB·English

Subex Limited
Annual Report 2016-17
Ring in the new.
Win in the digital world.
Forward-looking statement
In this Annual Report we have disclosed forward-looking information to enable investors
to comprehend our prospects and take informed investment decisions. This report and
other statements - written and oral - that we periodically make, contain forward-looking
statements that set out anticipated results based on the management’s plans and
assumptions. We have tried, wherever possible, to identify such statements by using
357.33
words such as ‘anticipates’, ‘estimates’, ‘expects’, ‘projects’, ‘intends’, ‘plans’,
‘believes’ and words of similar substance in connection with any discussion of
Revenues future performance.
(Rs. crore) We cannot guarantee that these forward-looking statements will be
realised, although we believe we have been prudent in assumptions.
The achievement of results is subject to risks, uncertainties and
even inaccurate assumptions. Should known or unknown risks
or uncertainties materialise, or should underlying assumptions
95.05 prove inaccurate, actual results could vary materially from
200+ those anticipated, estimated or projected. Readers should
Operating profit bear this in mind.
Customer
(Rs. crore) We undertake no obligation to publicly update any
base forward-looking statements, whether as a result of
new information, future events or otherwise.
900+
Highlights,
FY2016-17 Employee
base
Contents
Corporate identity ...........................................................2 Board of Directors ........................................................19
Message from the MD & CEO ...........................................4 Executive Leadership Team ..........................................20
Our performance in numbers ..........................................7 Board’s Report..............................................................22
Management commentary .............................................8 Corporate Governance Report .....................................52
Key numbers - global telecom industry .......................10 Management Discussion and Analysis ........................66
Operational Leadership Team (OLT) of Subex ..............11 Standalone Financial Statements ................................85
Creating value for 25 years ..........................................16 Consolidated Financial Statements ............................147
Subex Charitable Trust .................................................18 Shareholder Information ............................................208
Ring in the new.
Win in the digital world.
The time has come for Subex to graduate from one level to
another.
The time to transform from a telecom business optimisation
provider to a telecom analytics solution provider.
The time to graduate from providing limited solutions to
global communication service providers to embracing digital
transformation.
In helping customers transform their business models, Subex is
transforming its own.
Emerging better, stronger and larger. This is Subex 3.0.
Subex is a specialised
telecom solutions provider.
Enjoying focused and Background
specialised domain ●●Offering cutting-edge solutions
for global telecom companies for
knowledge.
25 years
●●Driven by a team of experienced
Providing revenue assurance,
professionals, led by Mr. Surjeet
fraud management, partner
Singh (Managing Director and CEO
settlement, asset assurance,
●●Leading global telecom analytics
analytics and IoT security. solution provider
●●Pioneered the concept of capex
Empowering telcos to embark optimisation
on informed strategy.
Location
Helping customers reduce ●●Headquartered in Bengaluru,
India
subscriber churn and
●●Global delivery centres in India,
enhance user experience.
the US and the UK
Enhancing competitiveness ●●Subsidiaries in the US, the UK, the
UAE, Singapore and India
and taking the customer’s
business ahead. Listing
●●Equity shares listed on Bombay
Stock Exchange and National
Stock Exchange. Company’s
securities listed on the London
Awards and accolades Stock Exchange and Singapore
●●Subex and Telefonica Chile won the BSS & OSS Award for Stock Exchange
the ‘Best Fraud Prevention Project’ in the ‘Best Revenue
Assurance /Fraud Solution’ category
Clientele
●●Subex and BTC Botswana awarded the prestigious Global
●●More than 200 clients across
Telecoms Business Innovation Awards 2016 in the
more than 90 countries, including
‘Business Service Innovation’ category
39 of the world’s top 50 telecom
●●Subex was awarded the Pipeline Innovation Award 2016 in operators
the ‘Security & Assurance’ category
| 2 |
SUBEX LIMITED
Annual Report 2016-17
Value pillars
Drive new business models: Enhance customer experience: Optimise enterprise:
Pivot offerings around revenue, Retain existing customers and Enable operational excellence by
open new revenue streams in acquire new customers using focusing on maximising revenue
emerging business areas and allied analytics, leverage business and mitigating business risks,
services, leverage the partner insights to better understand ensuring y-o-y cost savings that
ecosystem customer behaviour for deeper provide resources for investments
engagement
Subexians are committed to achieve total customer satisfaction by delivering high-
Quality statement quality products that meet the needs and expectations of our customers. We are
committed to adhere to quality management system requirements and continually
improve them.
Customer base Employee base Installations Presence Presence
90+ 25+
200+ 900+ 300+
countries years
As on 31st March As on 31st March As on 31st March As on 31st March As on 31st March
2017 2017 2017 2017 2017
| 3 |
We are standing currency debt. The result is
To the
at an important that we stand with a debt
stakeholders
juncture in the of only US$ 28.76 million
history of Subex. and a considerably lighter
Balance Sheet. Subsequent
Over the last four years, to 31st March 2017, the
a considerable focus was Company has repaid US$
invested in transforming 12 million loan thereby,
our Company from a reducing the outstanding
debt-heavy organisation debt to US$ 16.76 million.
to a deleveraged Balance
This transformed Balance
Sheet. From a point in FY13
Sheet empowered Subex
where we had around
to improve its operating
US$100 million in debt, we
performance. During FY17,
progressively equitised our
Subex reported a 10.81%
foreign currency convertible
improvement in revenues
debt and overseas foreign
Message from the MD & CEO
“Subex is uniquely
positioned as a long-
term business partner
in the telecom analytics
space at a time when
telecom players are
embarking on their digital
transformation journeys.”
| 4 |
SUBEX LIMITED
Annual Report 2016-17
and a 46.39% growth in leap. As telcos embark on a and data services and global telecom players.
EBIDTA. The Company repaid new digital transformation cannibalisation by over-
I believe that with great
H21.1 crore of working journey, creating unlimited the-top players offering
opportunity comes
capital debt in 2015-16 and opportunities, I foresee similar services. Hence,
large challenges. The
H18.05 crore in 2016-17, Subex playing a critical communication service
emergence of new business
which strengthened our net trust-based role in helping providers are launching
models has widened
debt-equity ratio from 0.45 these companies graduate new digital services
and deepened risks. For
in 2015-16 and to 0.36 in to stronger business like cloud and hosting,
instance, Yahoo’s market
2016-17, translating into models, enhanced customer M2M and IoT, security,
share declined following
a rating upgrade by India experience and optimised IP communication and
the leak of a confidential
Ratings IND BBB+ from IND costs. collaboration, data and
user base information
BBB. analytics, enterprise
I believe that the coming arising out of hacking.
mobility, finance and
Sectoral changes together of these The result of this new and
payments, among others,
macroeconomic factors and challenging ecosystem
The year under review was
with the objective to
our responsiveness will is a growing premium
marked by exciting realities
enhance customer
pave the way for a new on ‘end-to-end partner
across the global telecom
experience, improve loyalty
chapter in our existence management’ as opposed
landscape. We have seen
and strengthen revenues.
called ‘Subex 3.0’. to the conventional ‘partner
large global telcos acquiring
There is a growing settlement’ platform.
media companies to launch
The Subex 3.0
consensus that digital is
new digital services to own groundwork Subex is attractively placed
indeed the future. Digital
digital content and win the to capitalise on this reality.
Embracing changes transformation is enriching
mindshare of millennial Subex enjoys an established
proactively the customer experience
consumers who expect presence in the assurance
Globally, the telecom and increasing efficiency.
a compelling experience space; the Company’s
industry is undergoing a The advent of digitisation
across all walks of life. In proven ability to counter
dramatic transformation. has transformed the way
an emerging economy security risks are expected
Revenue models of global telcos work, attracting
like India, we saw the to enhance visibility and
telecom companies engagements with digital
emergence of a digital acceptability in the new
are graduating beyond content providers, insurance
service provider who has sectoral environment.
traditional avenues like players, app developers
disrupted the telecom world
voice and data. Subscriber and media companies. By As telcos struggle with
by transforming data into a
bases have begun to 2020, digital services could emerging business and
commodity service.
stagnate following the account for more than 10% technology challenges,
Subex has responded to commoditisation of voice of the overall revenues of they seek engagements
this reality through a digital with service providers
There is a growing consensus that digital is indeed the
future. Digital transformation is strengthening the customer
experience and increasing efficiency. The advent of digitisation
has transformed the way telcos work, attracting engagements
with digital content providers, insurance players, app
developers and media companies.
| 5 |
enjoying access to a of-the-art analytics to organisational structure Our proprietary gold mine
large data quantum and generate business insights empowers our people with of data, coupled with our
a corresponding analytics around Revenue, Product, enhanced accountability domain knowledge and
insight. Subex is best Customers and Risk. and motivates them to technological capabilities
positioned to leverage innovate. The Company has puts us in the best position
With digital transformation,
this opportunity. Over integrated diverse functions to draw meaningful insights
more devices are being
the years, the Company and I am pleased to state for our telco customers
connected with, Gartner
has aggregated a large that, this has resulted in to help them drive new
predicting that 8.4 billion
volume of data from diverse enhanced organisational business models, enhance
‘connected things’ will
installations, which is mined efficiency and helped customer experience and
be in use in 2017, up by
to create new revenue deliver a superior customer optimise their enterprises.
31% from 2016. In such a
streams, generate critical experience.
scenario, increasing focus This is an exciting phase in
insights and graduate the
on IoT security. Subex’s IoT Roadmap for the Subex’s long and storied
end-user experience. This
security solution monitors future 25-year journey and I look
competence in the cutting-
and generates alerts to forward to what the future
edge area of predictive Subex is optimistic of
threats in near real-time holds for the Company and
analytics positions Subex entering a larger number
Internet of Things (IoT) Subexians.
as a long-term telecom of enduring customer
environments. The solution
analytics business partner. engagements translating
focuses on the concept of
into larger ticket contracts.
Offering distinctive holistic ‘cyber resilience’ Regards,
The Subex management
services from asset and incident is confident that this Surjeet Singh
discovery and monitoring
There is increasing evidence represents the start of an Chief Executive Officer and
through response and
to suggest that telcos find exciting phase in its journey, Managing Director
recovery.
the exercise of generating which we call Subex 3.0.
data and extracting usable Creating a
In this exciting Subex
information difficult on
well-governed 3.0 journey, we will
account of domain-related
organisation transition to becoming
challenges and discrete
Subex is among the few a telecom analytics
databases, among other
Indian listed companies solution provider from
reasons.
in its niche that is a business optimisation
Subex is competently professionally-managed provider, which will help
placed to address this around a robust business telcos embrace digital
reality. The Company model. We created an transformation. In line with
possesses a large data operational leadership this strategy, we unveiled a
wealth following years team structure capable new logo, which represents
of engagement with of managing business our vibrancy, energy and
large global telecom operations while fostering a commitment to enhance
companies. The result is a sense of entrepreneurship. value for our customers in
competent use of state- Our simplified the digital era.
| 6 |
SUBEX LIMITED
Annual Report 2016-17
Our performance in numbers
Revenues (H crore) EBIDTA (H crore) EBIDTA (%)
3 6 3 5 7 0 3 7 9
8 4 3 7 2 0 8 1 9
9. 2. 7. 5. 8. 0. 3. 1. 7.
5 2 5 8 6 0 2 2 2
3 3 3 1
5 6 7 5 6 7 5 6 7
1 1 1 1 1 1 1 1 1
4- 5- 6- 4- 5- 6- 4- 5- 6-
1 1 1 1 1 1 1 1 1
0 0 0 0 0 0 0 0 0
2 2 2 2 2 2 2 2 2
2014-15 2014-15 2014-15 2014-15 2014-15 2014-15 2014-15 2014-15 2014-15
| 7 |
FY2016-17 proved the pillars of ‘drive new optimised operations.
to be a watershed business model, enhance
To achieve these daunting
for the global customer experience
business objectives, an
telecom industry and optimise experience’ increasing number of
resulting in the launch of
with digitisation telecom companies turned
Subex 3.0.
emerging as a to specialised service
disruptive force. As revenues from legacy providers like Subex.
businesses weakened
This might suggest that At Subex, we needed to
following the rise of
the going was easy for understand emerging
digital service providers
us during the year under business priorities and
and OTT players, telcos
review, but that would be objectives of CSPs to
became increasingly
far from the truth. At a time provide retrofitted solutions
selective in making fresh
when our key customers leading to sustainable
business investments. They
were challenged by large revenue streams. We
recognised the growing
and frequent security adopted a consultative
need to carve out new
breaches, we repositioned approach; we evolved from
revenue streams, a superior
our business around being a product vendor
customer experience and
to solutions provider; we
Management
commentary
Vinod Kumar Ashwin Chalapathy
Wholetime Director and Wholetime Director,
Chief Operating Officer Chief Technology Officer and
Head of Service Delivery
| 8 |