Proxy advisory firm InGovern Research Services has recommended shareholders should vote for all the three resolutions of Dish TV India, including the adoption of accounts. InGovern is of the view that the management and operations of the company should be viewed as “ongoing”, despite the dispute between the shareholders and the legal battles.
It recommends shareholders to favour the other two resolutions also — re-appointment of Ashok Kurien as a director and remuneration to the auditors.On the financial statements for FY21, the auditors had stated that Dish TV has non-current investment and non-current loans in a wholly-owned subsidiary — Dish Infra Services — of Rs 5,154.12 crore and Rs 741.73 crore, respectively.
Dish Infra Services had negative net current assets and incurred losses in the current year, although it has positive net worth as at March 31, 2021.The management has considered such balances as fully recoverable as of March 31, 2021. However, the management did not carry out a detailed and comprehensive impairment testing in accordance with accounting standards, the auditors had said.
According to InGovern, the auditors had expressed their opinion.“The same qualified opinions in both the standalone and consolidated financial statements were made even in the FY20 and shareholders had voted for the adoption of accounts in that year’s AGM. These same audit qualifications were passed by shareholders,” InGovern said in a note to shareholders.
“There are no new adverse qualifications in FY2020-21 and in the Limited Review reports of the first two quarters of FY2021-22,” InGovern said, adding, the management response has been that these investments were made for content creation and development of OTT platform, and these are fully realisable.
On the remuneration of the auditors, InGovern stated there were no “new adverse audit qualifications” in financial statements of FY21, and Kurien as a director had attended all Dish TV’s meetings.Dish TV has convened its annual general meeting, which was pushed back many times, on December 30 and e-votings for resolutions to be held between December 26 and December 29.
The resolutions are coming up for shareholder approvals in the background of an ongoing dispute between the company’s promoters and Yes Bank, its largest shareholder with a 25.6% stake. A number of legal cases have been filed across the Supreme Court, High Courts and National Company Law Tribunals.This is the first note by InGovern on Dish TV. Earlier, other proxy advisory firms had raised concerns against the direct-to-home TV service provider’s resolutions.