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AXISCADES Engineering Technologies Ltd.

BSE: 532395 Sector: IT
NSE: AXISCADES ISIN Code: INE555B01013
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VOLUME 34411
52-Week high 243.35
52-Week low 124.00
P/E 57.32
Mkt Cap.(Rs cr) 472
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 131.40
CLOSE 132.85
VOLUME 34411
52-Week high 243.35
52-Week low 124.00
P/E 57.32
Mkt Cap.(Rs cr) 472
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

AXISCADES Engineering Technologies Ltd. (AXISCADES) - Director Report

Company director report

To

The Members

Your Directors have pleasure in presenting the 27th Annual Report on the business andoperations of the Company together with the Financial Statement of the Company for thefinancial year (FY) ended March 312017. The consolidated performance of the Company andits subsidiaries has been referred to wherever required.

1. FINANCIAL RESULTS

(Rs. Million)

Particulars

Standalone

Consolidated

2016-17 2015-16 2016-17 2015-16
Total income 2394.65 2380.00 4990.24 3793.07
Total expenditure (before interest & depreciation) 2082.82 1867.97 4462.62 3219.44
Earnings before interest depreciation amortization and extra-ordinary items 311.83 512.03 527.62 573.63
Interest & finance charges 13.09 17.85 117.33 18.37
Depreciation & amortization 98.99 92.46 142.95 101.86
Earnings before Tax and Exceptional Items 199.75 401.72 267.34 453.40
Exceptional item 4.53 5.93 (5.23) 5.93
Profit before Tax (PBT) 195.22 395.79 272.57 447.47
Provision for Tax - Current & Deferred 67.03 132.99 136.83 157.60
Net Profit after Tax (PAT) 128.19 262.80 135.74 289.87
Minority Interest 0.00 0.00 4.33 4.07
Profit for the period 128.19 262.80 131.41 285.80

PERFORMANCE REVIEW

The Company continued to be the preferred engineering partner to clients in strategictechnology solutions aerospace heavy engineering automotive and industrial products.The year was challenging for us on various fronts. However we continue to invest indeveloping & acquiring competencies diversify into different verticals with anobjective to create a Company which is world-class. The Company has remained focused onbuilding a strong leadership team a targeted sales team and recruitment's of experts fromindustry to scale up different practice lines. These and an emphasis on deliveringmeasurable customer value has laid down a solid platform for accelerated growth in future.The Company has driven diversification of its offerings across new verticals andcompetencies across geographies along with continued strengthening of internal systems andprocesses. With the recently announced proposed JV with Assystem one of the world'sleading engineering company AXISCADES aims to enhance its offerings in the energyvertical.

FINANCIAL HIGHLIGHTS - STANDALONE

Total Income increased by 0.62 % toRs. 2394.65 million in 201617. EBIDTA decreased by39.10 % toRs. 311.83 million in 2016-17. Profit before tax and exceptional items decreasedby 50.28 % toRs. 199.75 million in 2016-17. Net Profit after tax decreased by 51.22 %toRs. 128.19 million in 2016-17.

FINANCIAL HIGHLIGHTS - CONSOLIDATED

Total Income increased by 31.56 % toRs. 4990.24 million in 201617. EBIDTA decreased by8.02 % toRs. 527.62 million in 2016-17. Profit before tax and exceptional items decreasedby 41.04 % toRs. 267.34 million in 2016-17. Net Profit after tax decreased by 54.02 %toRs. 131.41 million in 2016-17.

RESERVES

The Company has not transferred any amount to its reserves for the Financial Year endedMarch 312017.

DIVIDEND

Considering need for conservation of funds for catering to the growth plans of thecompany your Directors consider it expedient to pass over dividend for 2016-17.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

Loans guarantees and investments covered under Section 186 of the Companies Act 2013form part of the Notes to the financial statements provided in the Annual Report.

PUBLIC DEPOSITS

The Company has not accepted/renewed any public deposits and as such no amount onaccount of principal or interest on public deposits under Section 73 of the Companies Act2013 read with Companies (Acceptance of Deposits) Rules 2014 was outstanding as on thedate of the Balance Sheet.

ISSUE AND LISTING OF SHARES

The company's shares are listed on BSE Limited (BSE) and National Stock Exchange ofIndia Limited (NSE). Stock performance and stock data are furnished in the section onCorporate Governance.

During the financial year the Company has issued and allotted 10569937 Equity sharespursuant to the High Court approved Scheme of Amalgamation and therefore the Subscribedand Paid up Share Capital of the Company increased toRs. 188797650 i.e. 37759530Equity shares ofRs. 5/- each.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

The particulars of contracts or arrangements with related parties referred to insection 188(1) of the Companies Act 2013 are furnished in the prescribed form AOC 2 asAnnexure I to this Report. All transactions with the related parties during the financialyear were in the ordinary course of business. The transactions have been approved by theAudit Committee and the Board. Your attention is drawn to the Notes to the financialstatement.

The Company has not entered into any transaction with related parties which can beconsidered material in accordance of with the policy of the Company on material relatedparty transactions formulated as per the requirements of Listing Regulations. The Policyon materiality and dealing with related party transactions formulated and approved by theBoard is posted on the website of the Company and is accessible at www.axiscades.com

MATERIAL CHANGES AND COMMITMENTS

There were no material changes and commitments affecting the financial position of theCompany occurred between the financial year end and the date of this report.

MANAGEMENT DISCUSSION AND ANALYSIS

In terms of the provisions of Regulation 34 of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 a detailedchapter on Management Discussion and Analysis highlighting the Company's strategybusiness environment operations performance risks and outlooks is provided separatelyin this Annual Report.

BUSINESS STRUCTURE SUBSIDIARIES

The Company has the following subsidiaries:

Overseas Subsidiaries
Name of the subsidiary Location/Country
1 AXISCADES Inc. (formerly Axis Inc.) Peoria Illinois USA
2 AXISCADES UK Ltd. (formerly Axis EU Europe Ltd.) Leicestershire UK
3 AXISCADES Technology Canada Inc. (Formerly Cades Technology Canada Inc.) Montreal Quebec Canada
4 Axis Mechanical Engineering Design (Wuxi) Co Ltd Wuxi City China
5 AXISCADES GmbH Germany
Indian Subsidiaries
Name of the subsidiary Location/Country
1 Cades Studec Technologies (India) Private Limited (CSTI) Bengaluru India
2 AXISCADES Aerospace & Technologies Private Limited (ACAT) Bengaluru India
3 AXISCADES Aerospace Infrastructure Private Limited (AAIPL) Bengaluru India
4 Enertec Controls Limited (ECL) Bengaluru India

All overseas subsidiaries and AXISCADES Aerospace & Technologies Private Limited(Indian Subsidiary) are wholly owned by the Company.

In case of other Indian Subsidiaries- Cades Studec Technologies (India) PrivateLimited Company holds 76% of its equity shares.

AXISCADES Aerospace Infrastructure Private Limited - 99.99 % is held by ACAT.

Enertec Controls Limited - 51.84 % is held by ACAT and 48.16% by AAIPL.

There are no associate companies within the meaning of Section 2(6) of the CompaniesAct 2013.

A report on the performance and financial position of each of the subsidiaries as perrule 8(1) of Companies (Accounts) Rules 2014 is furnished under the statement containingsalient features of financial statements of subsidiaries in Form AOC 1 is attached to thisReport as Annexure II pursuant to Section 129(3) of Companies Act 2013.

In accordance with the provisions of Section 136 of the Companies Act 2013 theaudited financial statements of subsidiaries have been placed on the Company's website atwww.axiscades.com . The copies of these documents will be sent if requested by anyshareholder of the Company/ subsidiary interested in obtaining the same. These documentswill also be made available for inspection at the Registered Office of the Company duringbusiness hours on working days.

CONSOLIDATED FINANCIAL STATEMENTS

Pursuant to the provisions of Section 129(3) of Companies Act 2013 read withAccounting Standards (AS) 21 23 and 27 the audited Consolidated Financial Statements arefurnished in the Annual Report.

2. ORGANIZATION DEVELOPMENT

BOARD OF DIRECTORS Retirements and Reappointments

In the ensuing Annual General Meeting Mr. Valmeekanathan S. Director retire byrotation and being eligible offer himself for re-appointment. The Director recommend hisre-appointment at the ensuing Annual General Meeting.

No Independent Director is liable to retire at the ensuing Annual General Meeting(AGM).

Mr. Valmeekanathan S. continued as CEO & Director upto 7th Jan 2017 andthere after continuing as Non-Executive Director.

Mr. Sidhartha Mehra was inducted as the Non-Executive Director (Additional Director) ofthe Company with effect from August 10 2016 and was further re-appointed as an AdditionalDirector in the capacity of Non-Executive w.ef. 26 September 2016. He will be consideredfor reappointment in the ensuing Annual General Meeting.

Mrs. Vimmi M Trehan was reappointed as Additional Director (Woman Independent Director)with effect from March 11 2017 subsequent to her resignation.

Name of the Director Category Date of Appointment / reappointment Date of Approval by Shareholder Date of Resignation / cessation
1 Mr. Sidhartha Mehra Non- Executive Director 10.08.2016 26.09.2016 Proposed in the ensuing AGM 26.09.2016
2 Mr. Amit Gupta Non- Executive Director 12-09-14 07.09.2015 10.08.2016
3 Mrs. Vimmi M. Trehan Independent Director 30-03-2015 Reappointed on 11.03.2017 19-05-2015 Proposed in the ensuing AGM 8.12.2016
4 Mr. Valmeekanathan S. Non-Executive Director 25.02.2014 09.09.2014 Resigned as CEO w.e.f. 08.01.2017 and continuing as Non-Executive Director

HUMAN RESOURCES DEVELOPMENT

The Company is committed to build an environment and where employees are inspired toachieve excellence in their area of functioning. The Human Resource Policy of the Companyis focused on attracting building and retaining best talents. In this direction theCompany has taken several Human Resource initiatives and has strengthened the in-houseHuman Resource Department. Many continuous training and employee development programs areput in place. Company's health policies commits to provide safe and healthy workenvironment to all the employees.

The manpower strength of the Company on consolidated basis stood at 1761 employeesduring the year end.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 (12) of the Companies Act 2013 readwith Rule 5(1) of The Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 is provided as Annexure III to this Report.

The statement of particulars of employees pursuant to Rule 5(2) of Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is attached as AnnexureIV to this Report.

3. CORPORATE GOVERNANCE

The report on Corporate Governance as required under Schedule V of the SEBI (LODR)Regulations 2015 is attached and forms part of the Annual Report. A certificate from theAuditors of the company as regards of compliance of conditions of corporate governance isalso appended to the report.

MEETINGS OF THE BOARD

The Board of the Company met 9 (nine) times during the year. The dates attendance andother particulars of the meetings are furnished in the Report on Corporate Governanceattached to this Report. The intervening gap between any two meetings was within the limitprescribed by the provisions of Companies Act 2013.

COMMITTEES OF THE BOARD

The Audit Committee consists of 5 members namely Mr. Kailash M. Rustagi Mr. PradeepDadlani Mr. Srinath Batni and Dr. Vivek Mansingh Independent Directors and Mr. KedarnathChoudhury Non-executive Director. The Chairman of the Audit Committee is an IndependentDirector.

All the recommendations made by the Audit Committee during the year have been acceptedby the Board.

The Company has also constituted Nomination and Remuneration Committee StakeholdersRelationship Committee and Corporate Social Responsibility Committee as required under theprovisions of Companies Act 2013 and also as required under Listing Regulations and thecomposition scope of their functions responsibilities etc. are given in the CorporateGovernance Section which forms part of this Report.

DECLARATION FROM INDEPENDENT DIRECTORS

The Company has received declarations from all Independent Directors under Section149(7) of the Companies Act 2013 to the effect that they meet the criteria ofindependence as laid down in section 149(6) of the Companies Act 2013. The terms andconditions of appointment of Independent Directors are placed on the website of theCompany at www.axiscades.com

PERFORMANCE EVALUATION OF THE BOARD COMMITTEES AND DIRECTORS

The board of directors has carried out an annual evaluation of its own performanceBoard Committees and individual directors pursuant to the provisions of the Companies Act2013 and SEBI (LODR) Regulations 2015.

The performance of the Board and its committees was evaluated by the Board / Committeeafter seeking inputs from all the directors/members on the basis of the criteria andframework adopted by the Board. The evaluation process has been explained in the CorporateGovernance Report section of the Annual Report.

VIGIL MECHANISM

The Vigil Mechanism of the Company which also incorporates the Whistle blower policyprovides a formal mechanism to all Directors and employees to approach the Chairman of theAudit Committee and make protective disclosures about unethical behavior actual orsuspected fraud or violation of the Company's Code of Conduct or ethics policy. TheWhistle Blower Policy is an extension of the Company Code of Conduct which requires everyemployee to promptly report to the Management any actual or possible violation of the Codeor an event he is aware of that could affect the business or reputation of the Company.The disclosures reported are addressed in the manner and within the time frames prescribedin the Policy. No personnel of the Company were denied access to the Chairman of the AuditCommittee. The Whistle blower policy which also describes the mechanism may be accessed onthe Company's website at www.axiscades.com .

POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION

The company's policy on directors' appointment and remuneration including criteria fordetermining qualifications positive attributes independence of a director and the policyon remuneration of directors key managerial personnel and other employees formulatedpursuant to Section 134(3) (e) and 178 (3) of the Companies Act 2013 are furnished inAnnexure V

RISK MANAGEMENT POLICY

The Company has formulated and implemented a Risk Management Policy which focuses onidentification of elements of risk if any which in the opinion of the Board maythreaten the existence of the Company.

The Company has a risk identification and management frame work appropriate to its sizeand the environment under which it operates. The risk management process involvesidentification and periodic assessment of potential risks and their impact on theoperations profitability growth and continuity and focuses on risk elements relatedcompetitive position in the key market segments business environment statutory andregulatory changes global economy and business scenario Currency exchange ratefluctuations resource constraints etc. and initiating timely preventive as well asremedial actions.

Reporting and control mechanisms ensure timely information availability and facilitatesproactive risk management. These mechanisms are designed to cascade down to the level ofline managers so that risk at the transactional level are identified and steps are takentowards mitigation in a decentralized fashion.

Risks are being continuously monitored in relation to business strategy operations andtransactions statutory/legal compliance financial reporting information technologysystem etc. on inputs from both external and internal sources like key incidents Internalaudit findings etc.

The Board of Directors is responsible for monitoring risk levels on various parametersand the senior management group ensures implementation of mitigation measures ifrequired. The audit committee provides the overall direction on the risk managementpolicies.

PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

I n order to prevent sexual harassment of women at work place your Company has adopteda Policy for prevention of Sexual Harassment of Women at Workplace and has propermechanism to control the same which is commensurate with the nature and size of thebusiness of the company. During the financial year 2016-17 no such complaints werereceived.

4. DIRECTORS'RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) read with Section 134 (3) (c) of the Companies Act 2013your Directors confirm that:

a. i n the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;

b. t hey have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year and of the profitor loss of the Company for that period;

c. they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

d. they have prepared the annual accounts on a going concern basis;

e. they have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and are operating effectively; and

f. t hey have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.

5. AUDITORS AND AUDITORS' REPORT STATUTORY AUDITORS

M/S Walker Chandiok & Co LLP Chartered Accountants (Firm Registration No. 001076N/N500013) were appointed as Auditors of the Company by the shareholders at the AGM held onSeptember 9 2014 (duly ratified in the AGM dated September 7 2015) to hold office untilthe conclusion of the 27th AGM of the Company to be held during the calendar year 2017.

In terms of the first proviso to Section 139 of the Companies Act 2013 the appointmentof M/s S.R. Batliboi & Associates LLP Chartered Accountants shall be placed forapproval at the ensuing AGM. The Company has received a certificate from the auditors tothe effect that their appointment will be in accordance with the provisions of Section 141of the Companies Act 2013.

The Auditors' Report does not contain any qualification reservation or adverse remark.The Auditors' Report is enclosed with the financial statements in this Annual Report.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s Anant B. Khamankar & Co. Company Secretaries to undertake SecretarialAudit of the Company for the financial year 2016-17. The Secretarial Audit Report attachedas Annexure VI forms part of this report. Secretarial Audit Report does not contain anyqualification reservation or adverse remark.

Details in respect of frauds reported by Auditors other than those which are reportableto the Central Government

The Statutory Auditors or the Secretarial Auditors of the Company have not reported anyfrauds to the Audit Committee or to the Board of Directors under section 143(12) of theCompanies Act 2013 including rules made thereunder.

SIGNIFICANT ORDERS BY REGULATORS/COURTS/TRIBUNALS

There are no significant and material orders passed by the regulators or courts whichwould impact the going concern status of the company and its future operations (other thanthe one mentioned below w.r.t. Scheme of Amalgamation).

SCHEME OF AMALGAMATION:

The Board of Directors of the Company has approved the acquisition of AXISCADESAerospace & Technologies Pvt. Ltd. (ACAT) an aerospace defence and homeland securitytechnologies company by way of a Scheme of Amalgamation of its Holding Company namelyIndia Aviation Training Institute Pvt. Ltd. (IAT) with the Company. The said Scheme wassanctioned by the Hon'ble court of Karnataka vide its order dated 4th November 2016 whichcame into effect from 5th December 2016.

EXTRACT OF ANNUAL RETURNS

The extract of Annual Return of your Company as on March 31 2017 prepared pursuant toSection 92(3) of the Companies Act 2013 and the Rules made thereunder in Form MGT-9 isattached as Annexure VII to this Report.

INTERNAL FINANCIAL CONTROLS

Your Company has adopted the policies and procedures for ensuring the orderly andefficient conduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial disclosures. The same has been audited and certified by the StatutoryAuditors of the company in their Audit Report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The company has constituted a Corporate Social Responsibility Committee (CSR Committee)in accordance with the provisions of Section 135 of the Companies Act 2013 and the rulesmade thereunder. The Committee is chaired by an Independent Director. The Company onrecommendation of the CSR Committee has framed a CSR policy in line with Schedule VII ofthe Companies Act 2013. The policy has been posted and is accessible on the company'swebsite at www.axiscades.com .

The annual report on CSR activities is furnished in 'Annexure VIII' to this Report.

6. CONSERVATION OF ENERGY FOREIGN EXCHANGE EARNINGS ETC

The particulars pursuant to Rule 8(3) of Companies (Accounts) Rules 2014 are givenbelow

CONSERVATION OF ENERGY

Being an Information Technology company is not energy intensive. However adequatemeasures have been taken to conserve energy by introducing improved operational methods.The company in its initiative to be ISO14001 - Environmental Management System compliantis adhering to the provisions of E-Waste (Management and Handling) Rules 2011 andBatteries (Management and Handling) rules 2011 by efficiently managing the ACinstallations replacing PC's by VPC and recycling of paper etc.

Foreign Exchange Earnings and Outgo (Standalone)

(Rs. Million)

2016-17 2015-16
Foreign Exchange Earnings (actual inflows) 1913.75 1843.20
Foreign Exchange Outgo (actual outflows) 891.82 817.18

TECHNOLOGY ABSORPTION

The Company has not engaged any imported technology. Since the requirements of thetechnology business are changing constantly your Company has sought to focus on criticalin house technologies and processes which are likely to create value in the foreseeablefuture.

7. FUTURISTIC STATEMENTS

Certain statements made in this section or elsewhere in this report may be futuristicin nature. Such statements represent the intentions of the Management and the effortsbeing put in by them to realize certain goals. The success in realizing these goalsdepends on various factors both internal and external. Therefore the investors arerequested to make their own judgment by taking into account all relevant factors beforemaking any investment decision.

8. GREEN INITIATIVES

As in the previous years this year too we are publishing the Annual Report in theprint version only for the members who have not registered their email address with theCompany / Depository Participant. The Physical copies are sent in the permitted mode.Electronic copies of the Annual Report are sent to all the members whose email addressesare so registered.

ACKNOWLEDGEMENTS

Your Directors deeply appreciate and acknowledge the cooperation and support extendedby Clients Vendors Investors and Bankers various government agencies & regulatorybodies across the globe the Software Technology Park Noida Hyderabad & Bangaloreand other industry forums and agencies like NASSCOM and look forward to their continuedsupport in the future. Your Directors wish to place on record their appreciation of thevaluable contribution made by the employees of the Company at all levels.

For and on behalf of the Board of Directors

sd/- sd/-
Vivek Mansingh Sudhakar Gande
Chairman & Director Vice Chairman & Executive Director
Date: 30 May 2017
Place: Bengaluru

PARTICULARS OF CONTRACT / ARRANGEMENTS WITH RELATED PARTIES

(PURSUANT TO CLAUSE (H) OF SUB-SECTION (3) OF SECTION 134 OF THE ACT AND RULE 8(2) OFTHE COMPANIES (ACCOUNTS) RULES 2014 READ WITH SUB-SECTION (1) OF SECTION 188 OF THECOMPANIES ACT 2013-AOC-2)

1. DETAILS OF CONTRACTS OR ARRANGEMENTS OR TRANSACTIONS NOT AT ARM'S LENGTH BASIS:

Particulars Details
(a) Name(s) of the Related Party and nature of relationship NIL
(b) Nature of contracts / arrangements / transactions NIL
(c) Duration of the contracts / arrangements / transactions NIL
(d) Salient terms of the contracts or arrangements or transactions including the value if any. NIL
(e) Justification for entering into such contracts or arrangements or transactions. NIL
(f) Date(s) of approval by the Board NIL
(g) Amount paid as advances if any NIL
(h) Date on which the special resolution was passed in General Meeting as required under first provision to Section 188 NIL

2. DETAILS OF CONTRACTS OR ARRANGEMENTS OR TRANSACTIONS AT ARM'S LENGTH BASIS:

Particulars Details
(a) Name (s) of the related party AXISCADES Inc. AXISCADES UK Ltd. AXISCADES Technology Canada Inc. AXISCADES Aerospace & Technologies Private Limited AXISCADES GmBH Jupiter Capital Pvt. Ltd.
Nature of relationship Subsidiary Stepdown Subsidiary Subsidiary Subsidiary Subsidiary Holding Co.
(b) Nature of contracts/ arrangements/transaction Buy & Sale of service / Cross charge transactions Buy & Sale of service reimbursement / payment of expenses/ Cross charge transactions Sale of service reimbursement / payment of expenses/ Cross charge transactions Cross charge transactions/ Inter-Corporate Deposits/ Investment Investment / Cross charge transactions Inter-Corporate Deposits
(c) Duration of the contracts/ arrangements/transaction 1.36 Months from 1st Apr 2016 in respect of sale of services 1.36 Months from 1st Apr 2016 in respect of sale of services 1.36 Months from 1st Apr 2016 in respect of sale of services 2. Other transactions on ongoing basis Transactions on ongoing basis/24 Months contract NA Tenure 3 years till 30th May 2019
2. Other transactions on ongoing basis 2. 36 Months from 1st Sept 2016 in respect of purchase of services
3. Other transactions on ongoing basis
(d) Salient terms of the contracts or arrangements or transaction including the value if any Value of transactions during the year. (') Invoices to be raised each month within 10 business days from the end of each month payable within 15 days of receipt of money from the customer. Invoices to be raised each month within 10 business days from the end of each month payable within 15 days of receipt of money from the customer and for making payment it is within 60 days Invoices to be raised each month payable within 30 days Interest 14% pa Tenure 2 years Interest 12% p.a. Tenure 3 years till 30th May 2019
1. Sale of services 165788281 7628529 132884123 - - -
2. Expenses incurred on behalf of 1390531 1161543 2905243 6851689 239368 -
3. Software subscription charges incurred by 12972907 - - - - -
4. Salaries wages and bonus incurred on behalf of - - 5264923 17522872 - -
5. Salaries wages and bonus recovered / staff welfare expense incurred by 29857880 5328043
6. Inter Corporate Deposit (ICD) extended - - - 12500000 - -
7. Interest income - - - 20689315 - -
8. Investment - - - 149999962 1886750 -
9. Inter Corporate Deposit Repaid by - - - 150000000 - -
10. ICD availed from* - - - - - 1600000
11. Books & Periodicals purchased by 72766 - - - - -
12. Services received from - 5692287 - - - -
13. Interest Expenses - - - - - 805973
(e) Date of approval by the Board/ Audit Committee (in respect of contract of sale of services) The transactions were in the ordinary course of business and on arm's length basis. All the sales & purchase transactions are approved by the Audit Committee. ICD transactions are approved by Audit Committee and Board.
(f) Amount paid as advances if any NIL NIL NIL NIL - -

‘Pursuant to the Scheme of Amalgamation approved by the High Court of KarnatakaThe transactions entered into by India Aviation Training Institute Private Limited (IAT)(Transferor Co.) with related parties have been recorded in the books of the mergedentity.

For and on behalf of the Board of Directors

sd/- sd/- sd/-
Vivek Mansingh Sudhakar Gande Kaushik Sarkar
Chairman & Director Vice Chairman & Executive Director Chief Financial Officer
Date: 30 May 2017
Place: Bengaluru

STATEMENT CONTAINING SALIENT FEATURES OF THE FINANCIAL STATEMENT OF SUBSIDIARIES/

ASSOCIATE COMPANIES/JOINT VENTURES (Persuant to first proviso to Sub Section (3) ofSection129 of the Companies Act 2013 read with Rule 5 of the Companies (Accounts) Rules2014 (AOC -1)

AXISCADES Inc. (USA) AXISCADES UK Ltd. (UK) Axis Mechanical Engineering Design (Wuxi) Co. Ltd. (China) AXISCADES Technology Canada Inc. (Canada) AXISCADES GmbH (Germany) Cades Studec Technologies (India) Private Limited (India) AXISCADES Aerospace & Technologies Private Limited (ACAT) (India) AXISCADES Aerospace Infrastructure Private Limited (AAIPL) (India) Enertec Controls Limited (ECL) (India)
1 Financial period ended 31-Mar-17 31-Mar-17 31-Mar-17 31-Mar-17 31-Mar-17 31-Mar-17 31-Mar-17 31-Mar-17 31-Mar-17
2 Reporting currency and Exchange rate 2.1 Reporting Currency USD GBP RMB CAD EUR INR INR INR INR
2.2 Exchange rate as on the last date of the relevant Financial year in the case of foreign subsidiaries 64.8386 80.8797 9.4175 48.7116 69.2476 NA NA NA NA
3 Share capital 145707053 46544326 4242358 4871 1731190 6250000 168385120 41725330 13658690
4 Reserves & surplus 13850757 (35982084) (5588891) 168447560 2701 123904983 1241112950 686732507.55 252462520
5 Total assets 382390248 40198181 1072099 205747454 2185454 150884725 2307072696 729386944 304924443
6 Total Liabilities* 382390248 40198181 1072099 205747454 2185454 150884725 2307072696 729386944 304924443
7 Investments 74501561 - - - - 3499756 1063487662 120300000 3500
8 Turnover 1051369634 145270103 - 287850237 1007972 170503793 1109704476 0 0
9 Profit before taxation (28863956) (36833238) (352312) 47407494 2704 27100798 74595546 (822224) (3240768)
10 Provision for taxation - 1463680 - 12812014 - 9073291 45335742 0 370552
11 Profit after taxation (28863956) (38296918) (352312) 34595480 2704 18027507 29259804 (822224) (3611320)
12 Proposed Dividend - - - - - - - - -
13 % of shareholding 100% 100% Subsidiary of AXISCADES Inc. 100% 100% 100% 76% 100% 99.99% Subsidiary of ACAT 51.84% Subsidiary of ACAT

*Total liabilities includes Share capital and Reserves & Surplus.

The Company does not have any associate or Joint Venture company.

SUBSIDIARY'S PERFORMANCE AND FINANCIAL POSITION:

1. AXISCADES Inc : The revenue grew by 12.55 % as compared to last year due to newcustomer aquisition however the losses were due to increased sales and marketing expensesand competence building activities.

2. AXISCADES UK Ltd: The revenue decreased by 42.69 % due to significant change incustomer budgetary allocation. The losses were due to maintenance of basic work force tobe kept ready for new business opportunity.

3. AXISCADES Technology Canada Inc: The revenue decreased by 22.68 % as compared toprevious year due to outsourcing consolidation at customer end. The profit came down dueto lower revenue.

4. Cades Studec Technologies (India) Pvt. Ltd.: The Revenue has grown by 5.42% .

5. Axis China: The Company is working to obtain customer contract.

6. AXISCADES GmbH : During the year the Company has incorporated a wholly ownedsubsidiary on 16 August 2016 in Germany.

7. The company added 3 subsidiaries during the year as a result of amalgamattion withIndia Aviation Training Institute Private Limited duly approved by the High Court ofKarnataka vide its order dated 4th Novemeber 2016.

8. No subsidiary has been liquidated or sold during the year.

For and on behalf of the Board of Directors

sd/- sd/- sd/- sd/-
Vivek Mansingh Sudhakar Gande Kaushik Sarkar Shweta Agrawal
Chairman & Director Vice Chairman & Executive Director Chief Financial Officer Company Secretary
Date: 30 May 2017
Place: Bengaluru

DETAILS UNDER SECTION 197(12) OF THE COMPANIES ACT 2013 READ WITH RULES 5(1) OF THECOMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014

Rate Particulars
(i) The ratio of remuneration of each Director to the median remuneration a. Sudhakar Gande 55.85
of the employees of the Company for the financial year b. Valmeekanathan S.* 11.44
(ii) The percentage increase in remuneration of each Director Chief a. Sudhakar Gande** 41.49%
Financial Officer Chief Executive Officer Company Secretary in the Financial Year b. Valmeekanathan S.* Not Applicable
c. Kaushik Sarkar 2.7%
d. Shweta Agrawal 16.4%
(iii) The percentage increase in the median remuneration of employees in the financial year. 4.2%
(iv) The number of permanent employees on the rolls of the company 1183
(viii) Average percentile increase already made in the salaries of employees 2.79% (excluding managerial personnel)
other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration. 5.26% (including managerial personnel)
This is based on Remuneration Policy of the Company that rewards people based on their contribution to the success of the company and to ensure that the salaries are competitive to the peers in each geography that we operate in.
(xii) It is hereby affirmed that the remuneration is as per the Remuneration Policy of the Company.

Note: Remuneration excludes the value of perquisites.

* Valmeekanathan S. continued as CEO & Director upto 7 January 2017 and thereaftercontinues as Non-Executive Director.

** The percentage increase in the remuneration of Mr. Sudhakar Gande is on annualizedbasis since he was appointed as Executive Director w.e.f. 14.08.2015. For and on behalf ofthe Board

sd/- sd/-
Vivek Mansingh Sudhakar Gande
Chairman & Director Vice Chairman & Executive Director
Date: 30 May 2017
Place: Bengaluru

STATEMENT SHOWING THE DETAILS OF EMPLOYEES OF THE COMPANY AS PER RULE 5(2) OF THECOMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014:

Details of Top 10 employees in terms of remuneration drawn and employed throughout thefinancial year with an aggregate remuneration ofRs. 1 Crore Two Lakhs (1.02) and above-

Name of the Employee Designation of the Employee Remuneration received during the year Qualification Experience in years Date of commencement of employment Age Last employment held by the employee
Sudhakar Gande Vice Chairman & Executive Director 32880000 M.Tech in Electronics & Computers MBA (Finance) 28 14-08-2015 59 AXISCADES Aerospace Technologies Pvt. Ltd.(Vice Chairman & ED)
Marc Bouzaid Head of BU Engineering Services 12444691 B.Tech 12 08-03-2013 34 Teccon Design and Engineering (Manager)
Valmeekanathan S.* CEO & Director 10149672 BE (Hons) in Mechanical Engineering 32 25-02-2014 53 Independent Consulting (Consultant)
Abhay Sharma VP-Sales 9842089 BE 23 24-09-2012 44 Satyam Computer Service Limited (Program & Relationship Manager)
Oliver Brotzki General Manager 9659758 Graduated Mechanical Engineer 20 20-01-2012 48 3D Contech (Branch Manager)
Kaushik Sarkar Chief Financial Officer 9637812 Masters of Commerce FCA and ACMA 22 12-09-2014 47 Independent Consulting (Consultant)
Sriram Jayakrishna VP-Delivery 9174065 BE 23 09-04-2015 44 Tata Technologies Ltd. (Aero Engineering &Design- Program Management)
Monsieur Sinnasse Canda VP-Sales 8729949 MBA 30 01-10-2015 57 Bull - ATOS Technologies (Vice President)
A Visweswara Rao VP & Head-HR 6573961 MBA 22 16-04-2012 48 BT India Pvt Ltd (Head-HR)
Juergen Kaehm Lead Engineer 6256815 BE 36 01-12-2013 58 3D Contech Designer

* Valmeekanathan S. continued as CEO & Director upto 7 January 2017 and thereaftercontinues as Non-Executive Director.

Employed for part of the year with an average salary of 8.5 lac per month and above-None

Notes: 1. Nature of employment: All the above are in regular employment of the Company.

2. Remuneration includes company's contribution to PF variable pay and excludes thevalue of perquisites.

3. None of the above (together with their spouse and dependent children) holds 2% ormore of the equity shares of the Company except Mr. Sudhakar Gande who holds 4.5% equityshares of the Company.

4. None of the above employees is related to a Director.

For and on behalf of the Board

sd/- sd/-
Vivek Mansingh Sudhakar Gande
Chairman & Director Vice Chairman & Executive Director
Date: 30 May 2017
Place: Bengaluru

NOMINATION AND REMUNERATION POLICY

INTRODUCTION:

The Company is a Service Industry and therefore Company's policy strives to considerhuman resources as its invaluable assets to pay equitable remuneration to all DirectorsKey Managerial Personnel (KMP) and employees of the Company.

In terms of the provisions of the Companies Act 2013 and the listing agreement asamended from time to time the Nomination and Remuneration Committee has formulated thispolicy on nomination and remuneration of Directors Key Managerial Personnel and SeniorManagement (if any) and the same is approved by the Board of Directors.

OBJECTIVE:

• To lay down criteria with regard to identifying persons who are qualified tobecome Directors (Executive Non-Executive and Independent) and persons who may beappointed in Senior Management and Key Managerial positions.

• Formulating Policy for remuneration for the Directors / KMPs and SMPs

• To carry out evaluation of the performance of Directors as well as KeyManagerial and Senior Management Personnel.

• Recommending appointment and removal of Directors KMPs and SMPs

In order to achieve the aforesaid objectives the following policy has been formulatedby the Nomination and Remuneration Committee and adopted by the Board of Directors at itsmeeting held on 23rd June 2014. The revised policy was adopted on 9th September 2014.

EFFECTIVE DATE:

This policy shall be effective from 1st April 2014.

CONSTITUTION OF THE NOMINATION AND REMUNERATION COMMITTEE:

The Board has renamed its Remuneration Committee as Nomination and RemunerationCommittee on 27th March 2014 and reconstituted it on 9th September 2014. The Nominationand Remuneration Committee comprises of following Directors:

• Mr. Srinath Batni (Independent Director)
• Mr. Pradeep Dadlani (Independent Director)
• Mr. Kedarnath Choudhury (Non Executive Director)
• Ms. Shweta Agrawal (Secretary)

The Board has the power to reconstitute the Committee consistent with the applicablestatutory requirements.

APPLICABILITY:

The Policy is applicable to

• Directors (Executive and Non Executive)

• Key Managerial Personnel

• Senior Management Personnel (if any)

GENERAL

• This Policy is divided in three parts: Part - A covers the matters to be dealtwith and recommended by the Committee to the Board Part - B covers the appointment andnomination and remuneration PART - C covers proceedings of the Committee meetings.

• The key features of this Company's policy shall be included in the Board'sReport.

PART - A

MATTERS TO BE DEALT WITH AND RECOMMENDED TO THE BOARD

BY THE NOMINATION AND REMUNERATION COMMITTEE

The Committee shall:

• Formulate the criteria for determining qualifications positive attributes andindependence of a director.

• Identify persons who are qualified to become Director and persons who may beappointed in Key Managerial and Senior Management positions in accordance with thecriteria laid down.

• Recommend to the Board appointment of Director KMP and Senior ManagementPersonnel.

• Performance Evaluation of each Director KMP and Senior Management Personnel forthe purpose of appraisal or removal/ replacement.

• Policy for Remuneration for Director KMP and Senior Management Personnel.

• Monitor the Board Diversity and balanced Board

• Succession planning- recommends to the Board from time to time on long termsuccession plan and also contingency plan in case of exigencies relating to both Board aswell as Executive management.

• Retirement policy-The retirement age of the directors is fixed by the Board ofDirectors in consultation with the Nomination & Remuneration Committee.

PART - B

POLICY FOR APPOINTMENT AND REMOVAL & REMUNERTAION OF

DIRECTOR KMP AND SENIOR MANAGEMENT

• Appointment criteria and qualifications:

1. The Committee shall identify and ascertain the qualification expertise attributesand experience of the person for appointment as Director KMP or at Senior Managementlevel and recommend to the Board his / her appointment.

2. For Recommending any person as Executive Director the Committee shall take intoconsideration the provisions of the Companies Act 2013 read together with the Rulesprescribed there under and Schedule V.

3. For recommending any person as Non-Executive Director/ Independent Director theCommittee shall take into consideration the provisions of the Companies Act 2013 readtogether with the Rules prescribed there under and Schedule IV along with the criteria forindependence defined under Listing Agreement.

• The Committee shall carry out evaluation of performance of every Director KMPand Senior Management Personnel at regular interval (yearly).

• Due to reasons for any disqualification mentioned in the Companies Act 2013rules made there under or under any other applicable Act rules and regulations or on thebasis of performance evaluation the Committee may recommend to the

Board with reasons recorded in writing removal / replacement of a Director KMP orSenior Management Personnel subject to the provisions and compliance of the said Actrules and regulations.

• The Non- Executive / Independent Director may receive remuneration by way offees for attending meetings of Board or Committee thereof. Provided that the amount ofsuch fees shall not exceedRs. One lakh per meeting of the Board or Committee or suchamount as may be prescribed by the Central Government from time to time.

• An Independent Director shall not be entitled to any stock option of theCompany.

PART - C

COMMITTEE PROCEEDINGS

The Chairman of the Committee will report to the Board (at the next Board meeting) onthe proceedings of each Committee meeting bringing forward all Committee recommendationsrequiring Board approval.

The Secretary will: (a) in conjunction with the Chairman of the Committee settleagendas for and arrange meetings of the Committee so as to ensure timely coverage of allthe Committee's business; (b) distribute agendas and supporting papers to Committeemembers sufficiently far in advance of scheduled meetings to permit adequate preparation;(c) keep and distribute minutes of each meeting to Committee members; and (d) circulatecopies of the minutes to the remaining Board members upon request.