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Himatsingka Seide Ltd.

BSE: 514043 Sector: Industrials
NSE: HIMATSEIDE ISIN Code: INE049A01027
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VOLUME 38132
52-Week high 400.00
52-Week low 240.90
P/E 17.51
Mkt Cap.(Rs cr) 3,175
Buy Price 0.00
Buy Qty 0.00
Sell Price 319.50
Sell Qty 25.00
OPEN 323.75
CLOSE 324.65
VOLUME 38132
52-Week high 400.00
52-Week low 240.90
P/E 17.51
Mkt Cap.(Rs cr) 3,175
Buy Price 0.00
Buy Qty 0.00
Sell Price 319.50
Sell Qty 25.00

Himatsingka Seide Ltd. (HIMATSEIDE) - Director Report

Company director report

Your Directors are pleased to present the Thirty First Annual Report on the operationsand performance of your Company together with audited financial statements andauditors’ report for the year ended March 31 2016.

1. Business Operations Overview

The financial highlights for the year under review are given below:

(Rs in Lakhs)

Particulars Standalone Consolidated
2015-16 2014-15 Change % 2015-16 2014-15 Change %
Revenue 102066 94841 7.6% 188684 194316 -2.9%
Other Income 4155 3728 11.5% 2006 2088 -3.9%
Material cost 54588 54530 0.1% 112422 125121 -10.1%
% to Revenue 53.5% 57.5% 59.6% 64.4%
EBITDA 28162 18981 48.4% 31205 22153 40.9%
EBIT 24526 15439 58.9% 26338 17689 48.9%
Profit before exceptional items 18403 10934 68.3% 16923 9145 85.1%
Exceptional items
Profit before tax 18403 10934 68.3% 16923 9145 85.1%
Profit aƒer tax 17798 10934 62.8% 16660 9544 74.6%

In the Fiscal year 2015-16 the Consolidated Revenue marginally declined by 2.9% to Rs188648 Lakhs and EBITDA grew by 40.9% to Rs 31205 Lakhs. The increase in EBITDA wasdriven mainly by optimization of costs and increase in operational efficiency across thegroup through various initiatives. Prices of critical raw-material inputs remained stablethrough the year.

Prospects

Growth and efficiency initiatives during the year

During the year 2015-16 the company made significant progress on various initiativesrelating to its Manufacturing and Distribution business. Some of the initiatives thathelped bring additional clarity and operating efficiencies in the business model include

• Significantly enhanced operational efficiencies in manufacturing

• Focused on the optimization of Product Portfolio

• Achieved change of status from SEZ / EOU to DTA for manufacturing divisions

• Consolidated and enhanced revenue streams from Brand Portfolio in key markets

• Merged operating entities in North America to streamline group corporatestructure

• Announced Rs1300 Crores of fresh investments to be made to augment manufacturingcapacities and capabilities

• Made significant progress in turning around European division

Subsidiary Companies

As on March 31 2016 the Company had the following subsidiaries:

• Himatsingka Wovens Private Limited

• Himatsingka Holdings NA Inc.

• Himatsingka America Inc.

• Giuseppe Bellora S.r.l.

• Himatsingka Singapore Pte. Limited

• Twill & Oxford LLC.

With effect from 1st August 2015 the Group’s holding company in North America hasbeen renamed Himatsingka Holdings NA Inc. In addition the two operating subsidiariesDivatex Home Fashions Inc and DWI Holdings Inc have been merged and renamed as HimatsingkaAmerica. Inc.

There has been no material change in the nature of business of these subsidiaries.

As required under section 129(3) the Company has prepared consolidated financialstatements which form a part of the Annual Report.

The consolidated financial statements presented by the Company include the financialresults of its subsidiary companies. Further a statement containing the salient featuresof the financial statements of its subsidiaries in form AOC-1 is annexed to this report asAnnexure 1

Pursuant to section 136 of the Companies Act 2013 the audited financial statements ofthe subsidiaries are available on the Company’s website at http://www.himatsingka.com/financial-information.html.The Balance Sheet Statement of Profit and Loss and other documents of the subsidiarycompanies are kept for inspection at the Registered Office of the Company and that of therespective subsidiary companies. The Company will make available the annual accounts ofthe subsidiary companies and the related information to any member of the Company who maybe interested in obtaining it.

As required under Clause 49 of the listing agreement and Regulation 24 of SEBI (ListingObligations and disclosure requirements) Regulations 2015 the Company has draƒed apolicy for determining material subsidiaries. The policy has been disclosed in theCompany’s website and can be found athttp://www.himatsingka.com/corporate-governance.html

Research and Development

Research and development continues to provide valuable support to our business and hashelped us to keep pace with dynamic market conditions. We continue to give in-houseresearch and innovation the highest priority.

Environment Safety Energy conservation and Technology absorption

Safety and environmental protection remain a key area of focus for the Company.Investments are continuously made in projects that reduce / treat waste and increaseenergy efficiencies. We regularly upgrade our effluent treatment and water recyclingplants to keep abreast with technological advancements. By avoiding carcinogenic azo classdyes we ensure eco-friendly production and worker safety. Our endeavor has been tomaximize the efficient use of energy and ensure the safe and responsible discharge ofresidual wastes while minimizing any adverse environmental impact and waste generation.

2. Dividend

Your Directors in their meeting held on 11th March 2016 declared an interim dividendof 20% (Rs 1.00 per equity share). Further your Directors in their meeting held on 21stMay 2016 recommended a final dividend of 30% (Rs 1.50 per equity share) for the financialyear ended 31st March 2016 subject to approval by the shareholders at the Annual GeneralMeeting.

3. Transfer to Reserves

The Company proposes to transfer an amount of Rs 400 Lakhs to the Debenture RedemptionReserve. Subsequently an amount of Rs 800 Lakhs has been moved back from DebentureRedemption Reserve to General Reserve following the redemption.

4. Extract of Annual Return

In accordance with the Section 92(3) and as required under the section 134(3)(a) theextract of the Annual Return of the Company for the year ended 31st March 2016 is annexedhere to as Annexure 2 in the prescribed form MGT-9.

5. Number of meetings of the Board

The details of the meetings of the Board and the details of the attendance of thedirectors in the meetings are provided in the Corporate Governance Report.

6. Directors’ Responsibility Statement

As required by the provisions of Section 134(3)(c) of the Companies Act 2013 theDirectors’ Responsibility Statement is attached as Annexure 3 forming part of thisreport.

7. Declaration by Independent Directors

The Company has received from each of its Independent Directors the declaration asstipulated under Section 149(7) of the Companies Act 2013 confirming that the directormeets the criteria of independence as laid down under section 149(6) of the Companies Act2013.

8. Nomination and Remuneration Policy

The Company has formed a Nomination and Remuneration Committee as required under theSection 178 of the Companies Act 2013. The Committee has formulated a policy as requiredunder Section 178(3) of Companies Act 2013 stipulating the criteria for determiningqualifications positive attributes and independence of a director and also the criteriarelating to the remuneration for the directors key managerial personnel and otheremployees. The aforesaid policy is annexed to the Boards’ report as Annexure 4.

9. Auditors and Auditors’ Reports Statutory Audit

The Company at its 29th Annual General Meeting held on 23rd September 2014 appointedM/s Deloitte Haskins and Sells Chartered Accountants to hold office till the conclusionof 32nd Annual General Meeting subject to ratification by the members at every AGM. Thereport of Statutory Auditors (appearing elsewhere in the Annual Report) does not have anyqualifications/ adverse remarks.

Secretarial Audit

The Company had appointed Mr. Vivek Bhat Company Secretary in Practice Bengaluru toconduct the secretarial audit as required under Section 204 of the Companies Act 2013.The secretarial audit report given by Mr. Vivek Bhat is appended as Annexure 5 to theBoards’ Report.

In the above mentioned report Mr. Vivek Bhat has made the following comment:

"The company could not spend the eligible profit on Corporate SocialResponsibility measures. However the Company has constituted the CSR Committee and itsconstitution was as per the regulation."

Boards’ Response

The Company started two initiatives under Corporate Social Responsibility. One of whichwas providing "SMART CLASS ROOMS" for the Government Schools around the plant inHassan in partnership with CLT India (Children’s Lovecastles Trust) an organizationthat endeavors providing access to quality education for every child anywhere throughe-learning system in rural high schools.

Another initiative was to provide assistance to Deepshikha an Institute for ChildDevelopment and Mental Health to their school which provides special education tochildren.

As per the provisions the total amount to be spent by the Company on CSR activitiesfor the FY 2015-16 was Rs 150.40 Lakhs. During the year an amount of Rs 77 Lakhs wasspent by the Company.

10. Particulars of Loans Guarantees Investments and Securities made

The particulars of loans made guarantees given investments made and securitiesprovided as per the provisions of Section 186 of the Companies Act 2013 and the relevantrules made thereunder are given in the Notes to the standalone financial statements.

11. Particulars of Contracts or arrangements with related parties

All transactions entered into by the Company with its related parties are at arm’slength and in the ordinary course of business. However the list of material related partytransactions as per the Company’s policy on related party transactions as requiredunder rule 8(2) of Companies (Account) Rules 2014 is annexed to the Boards’ Reportas Annexure 6.

The Company has also formulated a policy on dealing with Related Parties Transactionsas required under Clause 49 of Listing Agreements and Regulation 23 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. The same is available in theCompany’s website at http://www.himatsingka.com/corporate-governance.html.

12. Material changes

No material changes or commitments affecting the financial position of the Company haveoccurred aƒer the closure of the financial year till the date of this report.

13. Exit from EOU & SEZ

The Drapery and Upholstery unit of the Company which was operating as 100% ExportOriented Unit (EOU) has exited out of EOU on November 5 2015 and currently operates as aDomestic Tariff Area Unit (DTA). The final exit order from Office of the DevelopmentCommissioner Cochin Special Economic Zone (CSEZ) dated November 05 2015 has beenreceived by the Company on 13th November 2015.

Bed Linen unit of the Company at Hassan which was operating as Special Economic Zone(SEZ) has exited out of SEZ and currently operates as a Domestic Tariff Area Unit (DTA).The Official Memorandum dated 27th January 2016 along with final exit Notification fromMinistry of Commerce and Industry Department of Commerce SEZ Section has been receivedby the Company.

14. Conservation of energy Technology absorption & Foreign exchange

The details of conservation of energy technology absorption and foreign exchange areannexed to the Boards’ Report as Annexure 7.

15. Risk Management

The Company has developed and implemented a comprehensive risk management policy andframework to counter and mitigate the various risks encountered by the Company. Thedetails of the same are given in the Risk Management section elsewhere in this AnnualReport.

16. Corporate Social Responsibility

The Corporate Social Responsibility (CSR) committee consists of the followingdirectors:

Sl. No. As on 31st March 2016 w.e.f. 21st May 2016
1 Dr. K R S Murthy Dr. K R S Murthy
2. Mr. A K Himatsingka NA
3. Mr. D K Himatsingka Mr. D K Himatsingka
4. Mr. Shrikant Himatsingka Mr. Shrikant Himatsingka

The Committee has devised the CSR policy as required under Section 135 of the CompaniesAct 2013 and the relevant rules made thereunder. As per the provisions the total amountto be spent by the Company on CSR activities for the FY 2015-16 was Rs 150.40 Lakhs.

During the year an amount of Rs 77 Lakhs was spent by the Company. The details of theCSR policy and the CSR spending have been elaborated in the Annexure 8 to this report.

17. Board Performance Evaluation

The Company has during the year conducted an evaluation of the Board as a whole itscommittees and the individual directors including the independent directors as stipulatedin the Nomination and Remuneration policy adopted by the Company. The evaluation wascarried out through different evaluation forms which covered among others the evaluationof the composition of the Board/ committee its effectiveness activities governance andwith respect to the chairman and the individual directors their participation integrityindependence knowledge impact and influence on the Board.

The independent directors of the Company also convened a separate meeting and evaluatedthe performance of the Board the non-independent directors and the chairman.

18. Directors and Key Managerial Personnel

The Board of Directors at its meeting held on 30th January 2016 changed thedesignation of Mr. Shrikant Himatsingka as Executive Director and CEO from ExecutiveDirector.

The Board of Directors at its meeting held on 21st May 2016 appointed Mr. D.K.Himatsingka as Executive Chairman of the Company and appointed Mr. Shrikant Himatsingka asManaging Director & Chief Executive Officer of the Company. The Board also appointedMr. Vasudevan V as an Additional Director designated as Executive Director of the Companyand appointed Ms. Sangeeta Kulkarni as Additional Director (Independent) of the Companywith effect from 21st May 2016. Pursuant to relevent provisions under Companies Act 2013the same has to be ratified by the shareholders in the ensuing Annual General Meeting andit is proposed to appoint the Independent Director and the Executive Director for a periodof 5 years.

In accordance with the provisions of the Companies Act 2013 and Articles ofAssociation of the Company Mr. Aditya Himatsingka retires by rotation and being eligibleoffers himself for re-appointment. His re-appointment will be placed as one of the agendain the ensuing Annual General Meeting.

Retirements and Resignations

• Mr. Dilip J Thakkar resigned as Director and Chairman of the Company with effectfrom 21st May 2016.

• Ms. Jayshree Poddar resigned as Director of the Company with effect from 22ndMay 2016 and shall continue as Head of Designs in the Company.

• Mr. A.K. Himatsingka resigned as Director and Vice Chairman of the Company witheffect from 22nd May 2016.

Your Directors wish to place on record their deep appreciation for the outstandingcontributions and services rendered by Mr. Dilip J Thakkar Mr. A. K. Himatsingkaand Ms. Jayshree Poddar during their tenure as Directors of the Company.

19. Composition of Audit Committee

The Company has constituted an Audit Committee as required under the Companies Act2013. The committee consists of the following directors:

Sl. No As on 31st March 2016 W.e.f. 21st May 2016
1. Mr. Dilip J Thakkar Mr. Rajiv Khaitan
2. Dr. K R S Murthy Dr. K R S Murthy
3. Mr. Rajiv Khaitan Mr. Berjis M Desai
4. N.A. Mr. Shrikant Himatsingka

During the year there have been no incidents where the Board has deviated from therecommendations made by the committee.

20. Vigil Mechanism

As a conscious and vigilant organization Himatsingka Seide Limited believes in theconduct of the affairs of its constituents in a fair and transparent manner by adoptingthe highest standards of professionalism honesty integrity and ethical behaviour. In itsendeavour to provide its employee a secure and a fearless working environment the Companyhas established a "Whistle Blower Policy" as required under the Companies Act2013 and the same is also available in the Company’s website.

Mr. Ashok Sharma Company Secretary has been designated as the Chief ComplianceOfficer under the policy and the employees can report any instance of unethical behaviouractual or suspected fraud or violation of the Company’s code of conduct or ethicspolicy to him.

In exceptional cases where the Whistle Blower is not satisfied with the outcome of theinvestigation and the decision she/ he can make a direct appeal to the Chairman of theAudit Committee and the contact details of the Chairman is also given in the Policy.

During the year no complaints were received under this mechanism.

21. Remuneration of Directors and Key Managerial Personnel a) Details ofDirectors’ remuneration

Rs in Lakhs
Director DIN Sitting fees Salaries and perquisites Commission Total Ratio to Median remuneration of employees Percentage increase over previous year
Dilip J Thakkar 00007339 1.20 Nil 14.00 15.20 14.56 : 1 36.94%
A K Himatsingka 00183698 0.40 Nil 12.00 12.40 11.88 : 1 18.09%
Rajiv Khaitan^ 00071487 1.50 Nil 7.00 8.50 8.14 : 1 37.10%
Dr. K R S Murthy 00167877 1.60 Nil 7.00 8.60 8.24:1 34.37%
Berjis M Desai 00153675 0.30 Nil 7.00 7.30 6.99 : 1 43.14%
D K Himatsingka 00139516 Nil 112.62 206.25 318.87 305.54 : 1 19.14%
Shrikant Himatsingka 00122103 Nil 72.82 206.25 279.07 258.78 : 1 18.53%
Aditya Himatsingka 00138970 Nil 56.55 85.00 141.55 135.63 : 1 16.16%
Jayshree Poddar* 07091651 Nil 33.74 30.00 63.74 61.07 : 1 1032.15%

* Ms. Jayshree Poddar was appointed as a director w.e.f. March 1 2015. ^ Paid toKhaitan & Co.

In the remuneration mentioned above the sitting fees salaries and perquisites formthe fixed component of the total remuneration and the commission is a variable componentlinked to the performance of the Company.

b) Details of the Remuneration of the Key Managerial Personnel (other than Directorsmentioned above)

Key Managerial Personnel Designation Total Remuneration (Rs In Lakhs) Percentage increase over previous year
K P Pradeep President – Finance and Group CFO 139.92 19.15%
Ashok Kumar Sharma AVP – Treasury Taxation & Company Secretary 52.16 33.16%

c) The percentage increase in median remuneration of the employees is 11.84%

d) The number of permanent employees in the rolls of the Company is 3066

e) The key parameters for the variable component of remuneration availed by thedirectors are the amount of responsibilities taken performance of the business specificcontribution made by the director to the overall performance of the Company.

f) During the year there were no employees whose remuneration was higher than thatof the highest paid director.

g) Statement of particulars of employees as required under rule 5(2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014:

Name of the Employee Gross Remune- ration (Rs) Qualification Experience Date of joining Age Previous employment
D K Himatsingka 31887265 B.A. (Hons.) 41 years 1-Aug-85 67 Managing Director Bihar Mercantile Union Ltd.
Shrikant Himatsingka 27907458 B.S. (Econ.) 14 years 15-May-01 36
Aditya Himatsingka 14154927 B.Com. (Hons.) Diploma in Textiles 29 years 1-Jan-88 52
Pradeep K P 13992628 ACA AICWA B.Com. 22 years 2-Nov-07 45 Director Finance Fidelity Business Services India Ltd
Vasudevan V 11920116 B.Sc. 36 years 14-Feb-13 60 Vice President – Raymond Zambaiti
Wilson Maria Doss YR 11344636 MSW 30 years 1-Sep-06 57 Vice President Human Resources Arvind Brands Ltd

22. Corporate Governance

We comply with the corporate governance code as prescribed by the stock exchanges andSEBI. You will find a detailed report on corporate governance as part of this annualreport. The auditor’s certificate on compliance with the mandatory recommendations oncorporate governance is annexed to this report as Annexure – 9.

23. Insurance

The Company’s assets are prone to risks / peril. The major risks / peril areadequately insured.

24. Public Deposits

The Company has not accepted any deposits from the public during the year within themeaning of the Companies Act 2013.

25. Cost Auditors

The Companies (Cost Records and Audit) Rules 2014 has exempted the mandatory costaudit requirements in respect of units located in Special Economic Zones (SEZ) and for100% Export Oriented Units (EOU). In view of this there was no requirement to furnishcost audit of cost records of the Company for its units at Hassan (SEZ) and Doddaballapur(EOU). The Company has exited from the export oriented unit and also exited from thespecial economic zone. Since the Company’s export revenue in foreign exchange forthe financial year 2015-2016 was greater than 75% (seventy five percent) of the totalrevenue of the Company the Company falls within the exemption specified in Clause 4(3) ofThe Companies (Cost Records and Audit) Rules 2014. In view of this there is norequirement to furnish cost audit of cost records of the Company for its units at Hassanand Doddaballapur.

26. Disclosure as required under Section 22 of Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013

The Company is committed to provide a healthy environment to all its employees. Henceit does not tolerate any discrimination and/or harassment in any form. The Company has inplace a Anti Sexual Harrassment Policy and Committee as per the requirements of SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013. TheCompany has not received any complaint during the year.

27. Dividend Distribution Policy

The Board of Directors of the Company have adopted a dividend distribution policy asrequired under Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements)(Second Amendment) Regulations 2016. The policy is attached as Annexure-10

Acknowledgement

Your Directors wish to place on record their appreciation of the continuous effortsmade by all employees in ensuring excellent all-round operational performance. We alsowish to thank our Customers Vendors Shareholders and Bankers for their continuedsupport. Your Directors would like to express their grateful appreciation to the CentralGovernment and Government of Karnataka for their continued co-operation and assistance.

For and on behalf of the Board
Place: Bengaluru D.K. Himatsingka
Date : August 10 2016 Executive Chairman

ANNEXURES TO THE BOARDS’ REPORT

Annexure 1

Statement regarding subsidiary companies as of March 312016

Pursuant to Section 129 of the Companies Act 2013 read with Rule 5 of Companies(Accounts) Rules 2014 – AOC-1

(Rs in Lakhs)
Name of the Subsidiary Himatsingka Wovens Pvt Ltd. Twill & Oxford LLC Himatsingka Singapore Pte Ltd. Himatsingka America Inc. Himatsingka Holdings NA Inc. Giuseppe Bellora S.r.l
1 Capital* 1750 37.35 1082.77 0.03 30843.45 20113.34
2 Reserves (9.98) (316.39) (2122.19) 34058.46 (1577.02) (22453.07)
3 Total Assets 5937.84 238.64 98.38 55678.23 92775.97 9947.78
4 Total Liabilities ^ 4197.82 517.68 1137.80 21619.74 63509.54 12306.66
5 Investments (Other than 19.15
in subsidiaries)
6 Turnover 3242.69 773.68 195.55 158518.09 29705.22 6845.95
7 Profit/(Loss) Before Tax (939.12) (18.30) (336.84) 3133.17 (2702.51) 32.65
8 Provision for Taxation (100.20) 124.14 (660.80)
9 Profit/(Loss) Aƒer Tax (838.92) (18.30) (336.84) 3009.03 (2041.71) 32.65
10 Proposed Dividend
11 Closing exchange rate Rs 18.06/AED Rs 49.11/ SGD Rs 66.33/ USD Rs 66.33/ USD Rs 75.11/ Euro
12 Average exchange rate Rs 17.83/AED Rs 47.26/ SGD Rs 65.47/ USD Rs 65.47/ USD Rs 72.32/ Euro

*(including preference capital and share application money)

^(excluding Capital and Reserves and including current liabilities and provisions)

For and on behalf of the Board of Directors
Dilip J. Thakkar A.K. Himatsingka D.K. Himatsingka
Chairman Vice Chairman Managing Director
Shrikant Himatsingka Pradeep K.P. Ashok Sharma
Executive Director & CEO Chief Financial Officer Company Secretary
Bengaluru
Date: May 21 2016

Annexure 3

Directors’ Responsibility Statement

We the Directors of Himatsingka Seide Limited confirm the following:

(a) in the preparation of the annual accounts the applicable accounting standards hasbeen followed along with proper explanation relating to material departures;

(b) the directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit and loss of the company for that period;

(c) the directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;

(d) the directors have prepared the annual accounts on a going concern basis; and

(e) the directors have laid down internal financial controls to be followed by thecompany and such internal financial controls are adequate and are operating effectively

(f) the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.

For and on behalf of the Board
Place: Bengaluru D.K. Himatsingka
Date : August 10 2016 Executive Chairman

Annexure 4

Nomination and Remuneration Policy

Preamble

Himatsingka Seide Ltd in its constant endeavour to ensure the all-round welfare of itsHuman Resources and their effective application to the growth of the Company hasformulated the following policy in line with the requirements of the Companies Act 2013and the amendment to the Clause 49 of the Listing Agreement (vide SEBI circular no.circular CIR/CFD/POLICY CELL/2/2014 dated April 17 2014) and Regulation 19 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.

Effective Date

The policy is effective from October 1 2014.

Definitions

For the purposes of this policy

"Nomination and Remuneration Committee or Committee" shall mean a Committeeof the Board of Directors of the Company constituted under provisions of Listing agreement/ Regulations and Companies Act 2013.

"Board" means Board of Directors of HSL.

"Company or HSL" shall mean Himatsingka Seide Limited wherever it isreferred to in the policy. "Directors" shall mean the directors of HSL.

"Key Managerial Personnel" or "KMP" shall mean key managerialpersonnel in relation to HSL as defined under the Companies Act 2013 as follows:

(i) the Chief Executive Officer or the managing director or the manager;

(ii) the Company Secretary;

(iii) the Whole-time Director;

(iv) the Chief Financial Officer;

"Policy" shall mean the Nomination and Remuneration Policy.

"Senior Management" for the purpose of this policy shall refer to theemployees of the Company occupying the position of Functional Head (Department Heads) butdoes not include the directors and the KMP.

"Shareholders" shall mean the shareholders of HSL.

"Special Resolution" shall mean a resolution in which the votes cast infavour of the resolution whether on a show of hands or electronically or on a poll asthe case may be by members who being entitled so to do vote in person or by proxy or bypostal ballot are required to be not less than three times the number of the votes ifany cast against the resolution by members so entitled and voting.

The Policy

Part-I: Role of the Committee

The Committee shall:–

1. Identify persons who are qualified to become directors and who may be appointed insenior management in accordance with the criteria laid down;

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

3. Recommend to the Board their appointment and removal;

4. Recommend to the Board a policy relating to the remuneration for the directors keymanagerial personnel and other employees;

5. Carry out evaluation of every director’s performance;

6. Formulate criteria for evaluation of independent directors and the Board.

7. Devise a policy on Board Diversity;

8. Develop a succession plan for the Board Key Managerial Personnel and SeniorManagement.

Part-II: Remuneration policy A. Guiding Principles:

• The remuneration determined under this policy shall have a proper balancebetween fixed pay and performance based variable pay reflecting short term and long termperformance objectives and goals of the Company.

• The remuneration determined shall also ensure a direct relationship with keyresult areas and individual achievements and thereby strongly aligning with the interestsof the Company’s stakeholders.

• The level and composition of remuneration determined shall be reasonable andsufficient to attract retain and motivate Directors and other personnel of the qualityrequired to run the Company successfully.

B. The Remuneration Policy

1. For Executive & Non-Executive Directors:

The Committee shall recommend to the Board the remuneration / commission on Net Profitand perquisites in case of Executive Directors. For Non-Executive Directors the committeeshall recommend to the Board the remuneration which would include commission and sittingfees payable. The acceptance of the recommendation as made by the committee or with anymodifications shall be the discretion of the Board and aƒer deliberation on thematter the Board may approve the remuneration subject to the necessary approvals asrequired under the Companies Act 2013 and rules made thereunder and the SEBI listingagreement / Listing Regulations and any modifications thereto from time to time.

a) Executive Directors:

i. Fixed and Variable pay:

The Managing Director and the Executive Directors shall be eligible for a fixed monthlysalary and perquisites as may be recommended by the Committee and approved by the Board.The break-up of the pay scale and quantum of perquisites including house rent allowanceleave travel assistance employer’s contribution to provident fund gratuity fundclub fees medical reimbursement insurance Company car with driver telephone etc. shallbe decided by the Board on recommendation of the committee and shall be approved by theshareholders.

In addition to the fixed pay and perquisites stated above the Managing Director andExecutive Directors shall be entitled to variable pay by way of commission on net profitsof the Company at rates recommended by the committee subject to the overall limitsprescribed in the Act and necessary approvals as required thereunder from time to time.

ii. Minimum Remuneration:

If in any financial year the Company has no profits or its profits are inadequate itshall pay remuneration to the Managing Director and Executive Directors in accordance withthe provisions of the Act and rules made thereunder. In case the Company is unable tocomply with the aforementioned provisions the remuneration shall be paid with theprevious approval of the Central Government.

iii. Excess Remuneration:

If the Directors receive inadvertently or otherwise any amount directly orindirectly by way of remuneration in excess of the limits prescribed under the Actwithout the necessary approvals as prescribed under the Act he/she shall refund such sumsto the Company and until such sum is refunded hold it in trust for the Company.

The Company shall not waive recovery of such sum unless permitted by the CentralGovernment.

iv. Sitting Fees:

The Executive Directors shall not be liable to receive sitting fees.

b) Non-Executive Directors:

i. Sitting Fees:

The Non-Executive whether Independent or not shall be entitled to receive sitting feesfor attending meetings of the Board and Committees thereof. Provided that such fees shallnot exceed the limits specified under the Act and rules made thereunder. ii. Commission:

In addition to the sitting fees the Non-Executive Directors shall be entitled toreceive remuneration by way of commission of net profit of the Company at ratesrecommended by the committee and approved by the Board and the shareholders of theCompany subject to the limits prescribed under the Act and the rules thereunder.

The travelling and out of pocket expenses if any incurred by the Directors in thecourse of performing their duty as directors of the Company shall be reimbursed to them.

Independent Directors shall not be eligible for employees’ stock options.

2. For KMP and Senior Management:

The remuneration of the KMP not covered above or the Senior Management personnel asthe case may be will be determined by the management on recommendation of the Committee.The remuneration shall include fixed monthly basic salary dearness allowance house rentallowance special allowance etc.; and other perquisites like Company car with drivertelephone etc.

3. For other employees:

The remuneration of all other employees may be determined by the Senior Management inconsultation with the Human Resources department of the Company provided that theremuneration thus fixed shall be sufficient to retain talent and motivate the employees soas to ensure smooth and effective functioning of all the departments of the Company.

Part-III: Board Diversity

It shall be the endeavour of the Committee to ensure that the Board of the Companycomprises of directors having sufficient knowledge and experience in various fields suchas Finance Legal Marketing and such other field as may be advantageous to the Company toensure wise guidance in the functioning and governing of the Company. The Committee shallreview the constitution of the Board annually so as to ensure that the Board consists ofmembers with diversified skills knowledge experience and expertise to meet or exceed therequirements of the Company’s business.

Part-IV: Criteria for selecting directors A. Qualification positive attributes andindependence of directors:

• The Committee will identify persons with high educational qualification richexperience and expertise integrity desirable personal traits and leadership qualitiesand recommend to the Board for appointment as Director KMP or at Senior Management level.The proposed appointee shall possess appropriate skills knowledge experience in one ormore fields of finance accounts audit law management sales marketingadministration research corporate governance technical operation or other disciplinesrelated to the Company’s business. The Committee has the discretion to decide on theage qualification expertise and experience to be possessed by the appointee for theconcerned position depending up on the circumstances of each case.

• The director to be appointed shall be a person adhering to all the eligibilitynorms as specified under the Companies Act 2013 and the rules made thereunder or anystatutory modifications thereof from time to time including the norms for maximum numberof directorships and shall not be a person disqualified under the section 164 of the saidAct.

• Managing/ Whole-time Director:

The Company shall appoint or continue the employment of any person as ManagingDirector/ Whole-time Director who has attained the age of twenty one years and has notattained the age of seventy years.

Provided that appointment/ continuing the term of a person who has attained the age ofseventy years may be made by passing a special resolution in which case the explanatorystatement annexed to the notice for such motion shall indicate the justification forappointing such person.

• Independent Directors:

In case of appointment of Independent Directors it shall be ensured that the proposedappointee is not serving as an Independent Director in more than six listed companies andin case he/she is serving as a whole-time director in any listed company it shall beensured that he/she is not serving as independent director in more than two listedcompanies. Further the person to be appointed shall conform to the norms for anindependent director specified under section 149(6) of the Companies Act 2013 and therules made thereunder and under the SEBI’s listing agreement or any statutorymodifications to the same made from time to time.

Every independent director of the Company shall on the first meeting of the Board inwhich he participates and thereaƒer the first meeting of the Board in every financialyear or whenever there is a change in his/her status as an independent director give adeclaration that he meets the criteria of independence as provided under section 149(6) ofthe Act.

• Non-Executive Directors:

The criteria as specified in the above paragraphs shall mutatis mutandis be applicableto non-executive non-independent directors as well and they shall be liable to retire byrotation.

Tenure: a) Managing Director/ Executive Directors:

The Company shall appoint or re-appoint any person as its Executive Chairman ManagingDirector or Executive Director for a term not exceeding five years at a time. Nore-appointment shall be made earlier than one year before the expiry of term.

b) Independent Director:

An Independent Director shall hold office for a term up to five consecutive years onthe Board of the Company and will be eligible for re-appointment on passing of a specialresolution by the Company and disclosure of such appointment in the Board’s report.

No Independent Director shall hold office for more than two consecutive terms but suchIndependent Director shall be eligible for appointment aƒer expiry of three years ofceasing to become an Independent Director. Provided that an Independent Director shallnot during the said period of three years be appointed in or be associated with theCompany in any other capacity either directly or indirectly.

Independent Directors shall not be liable to retire by rotation.

B. Retirement:

The Directors KMP and Senior Management shall be liable to retire as per theprovisions of the Act and rules made thereunder and the prevailing employees’retirement policy of the Company. However the Board shall have the discretion to retainany Director (other than an Independent Director) KMP Senior Management personnel or anyother employee even aƒer he/she has attained the retirement age as it deems fit forthe benefit of the Company.

C. Succession:

The constitution of the Board the KMP and Senior Management personnel of the Companyshall be in such a manner that it consists of a combination of persons of different agegroups and possessing expertise and skill in the various areas and fields required for theeffective running of the Company so as to ensure smooth succession at all times.

Part-V: Performance Evaluation A. Performance evaluation of the Board/any committee:

The Committee shall carry out the evaluation of effectiveness of the Board and allCommittees of the Board and their functioning on an annual basis such that the same isaligned with the Company’s financial year. It shall lay down the criteria for theabove mentioned evaluation every year. The functioning of the Board shall be evaluated onthe basis of its effectiveness with regard to achievement of the short medium and longterm goals of the Company.

B. Performance evaluation of Directors:

The Committee will carry out the performance evaluation of all Directors KMP andSenior Management Personnel every year such that the evaluation is aligned with theCompany’s financial year. The evaluation criteria shall include measures to test theparticipation and contribution of the Directors integrity skill expertise commitmentand diligence. The committee shall carry out the evaluation of every Director’sperformance in which the Director being evaluated shall not participate.

Further the performance evaluation of independent directors shall be done by theentire Board of Directors excluding the director being evaluated.

On the basis of the report of performance evaluation it shall be determined whether toextend or continue the term of appointment of the independent director.

The directors shall be evaluated with regard to their adherence to and compliance withthe professional conduct role functions and duties as specified in the Code forIndependent Directors in the Schedule IV of Companies Act 2013 including any statutorymodifications made thereto from time to time.

C. Removal:

The Committee may even before the expiry of the term recommend to the Board withreasons recorded in writing removal of a Director KMP or Senior Management Personnelwhere he/ she has attracted any disqualification mentioned in the Act or under any otherapplicable Act rules and regulations thereunder.

Provided that the aforesaid recommendation shall be subject to the provision andcompliance with the said Act rules or regulations.

Part-VI: Other Provisions A. Deviation from the Policy:

The Board in extraordinary circumstances when deemed necessary on recommendation ofthe Committee shall at its discretion accept any reasonable deviation from any elementof this policy in specific cases.

B. Amendments:

Any amendments to this Policy subject to the Act the rules made thereunder and theprovisions of the listing agreement / listing regulations shall be made only by the Boardof Directors of the Company on recommendation of the Committee.

This policy shall be disclosed in the Company’s Annual Report.

Annexure 5

Form No. MR-3 SECRETARIAL AUDIT REPORT

For the Financial Year ended 31st March 2016

[Pursuant to Section 204(1) of the Companies Act 2013 and Rule No. 9 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014]

To

The Members

M/s Himatsingka Seide Limited 10/24 Kumara Krupa Road High Grounds Bengaluru-560001

I have conducted the secretarial audit of the compliance of applicable statutoryprovisions and the adherence to good corporate practices by M/s Himatsingka Seide Limited(hereinaƒer called the Company). Secretarial Audit was conducted in a manner thatprovided me a reasonable basis for evaluating the corporate conducts/statutory compliancesand expressing my opinion thereon.

Based on my verification of the Company’s books papers minute books forms andreturns filed and other records maintained by the Company and also the informationprovided by the Company its officers agents and authorized representatives during theconduct of secretarial audit I hereby report that in my opinion the Company has duringthe audit period covering the financial year ended on 31st March 2016 complied with thestatutory provisions listed hereunder and also that the Company has proper Board-processesand compliance-mechanism in place to the extent in the manner and subject to thereporting made hereinaƒer:

I have examined the books papers minute books forms and returns filed and otherrecords maintained by M/s Himatsingka Seide Limited for the financial year ended on 31stMarch 2016 according to the provisions of:

. The Companies Act 2013 (the Act) and the Rules made thereunder;

. The Securities Contracts (Regulation) Act 1956 (‘SCRA’) and the Rules madethereunder; III. The Depositories Act 1996 and the Regulations and Bye-laws framedthereunder;

IV. Foreign Exchange Management Act 1999 and the Rules and Regulations made thereunderto the extent of investment in overseas subsidiary and External Commercial Borrowings;

V. The following Regulations and Guidelines prescribed under the Securities andExchange Board of India Act 1992 (‘SEBI Act’)

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares andTakeovers) Regulations 2011;

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 1992;

(c) The Securities and Exchange Board of India (Issue of Capital and DisclosureRequirements) Regulations 2009;

(d) The Securities and Exchange Board of India (Employee Stock Option Scheme andEmployee Stock Purchase Scheme) Guidelines 1999;

(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities)Regulations 2008;

(f) The Securities and Exchange Board of India (Registrars to an Issue and ShareTransfer Agents) Regulations 1993 regarding the Companies Act and dealing with client;

(g) The Securities and Exchange Board of India (Delisting of Equity Shares)Regulations 2009; and

(h) The Securities and Exchange Board of India (Buyback of Securities) Regulations1998; VI. Other laws applicable to the Company like Factories Act 1948 The Payment ofGratuity Act etc.

I have also examined compliance with the applicable clauses of the following:

(i) Secretarial Standards issued by The Institute of Company Secretaries of India.

(ii) The Listing Agreements entered into by the Company with the BSE Limited NationalStock Exchange of India Limited. During the period under review the Company has compliedwith the provisions of the Act Rules Regulations Guidelines Standards etc mentionedabove except to the extent as mentioned below:

1. The company could not spend the eligible profit on Corporate Social Responsibilitymeasures. However the Company has constituted the CSR Committee and its constitution wasas per the regulation.

I further report that

The Board of Directors of the Company is duly constituted with proper balance ofExecutive Directors Non-Executive Directors Woman Director and Independent Directors.The Changes in the composition of the Board of Directors that took place during the periodunder review were carried out in compliance with the provisions of the Act. Adequatenotice is given to all directors to schedule the Board Meetings agenda and detailed Noteson agenda were sent at least seven days in advance and a system exists for seeking andobtaining further information and clarifications on the agenda items before the meetingand for meaningful participation at the meeting.

Majority decision is carried through while the dissenting members’ views arecaptured and recorded as part of the minutes.

I further report that there are adequate systems and processes in the companycommensurate with the size and operations of the Company to monitor and ensure compliancewith applicable laws rules regulations and guidelines.

VIVEK BHAT
Place: Bengaluru Practicing Company Secretary
Date : May 16 2016 CP: 8426

This report is to be read with my letter of even date which is annexed as Annexure Aand forms an integral part of this report.

Annexure A

To

The Members

M/s Himatsingka Seide Limited 10/24 Kumara Krupa Road High Grounds Bengaluru-560001.

My report of even date is to be read along with this letter.

1. Maintenance of secretarial record is the responsibility of the management of theCompany. My responsibility is to express an opinion on these secretarial records based onmy audit.

2. I have followed the audit practices and processes as were appropriate to obtainreasonable assurance about the correctness of the contents of the secretarial records. Theverification was done on test basis to ensure that correct facts are reflected insecretarial records. I believe that the processes and practices I followed provide areasonable basis for my opinion.

3. I have not verified the correctness and appropriateness of financial records andBooks of Accounts of the Company.

4. Wherever required I have obtained the Management representation about thecompliance of laws rules and regulations and happening of events etc.

5. The Compliance of the provisions of Corporate and other applicable laws rulesregulations standards is the responsibility of management. My examination was limited tothe verification of procedures on test basis.

6. The Secretarial Audit report is neither an assurance as to the future viability ofthe company nor of the efficacy or effectiveness with which the management has conductedthe affairs of the Company.

Place: Bengaluru
Date : May 16 2016

Annexure 6

Details of Related Party Transactions pursuant to clause (h) of sub-section (3) ofsection 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules 2014

Name of the Related Party Nature of relationship Nature of contract / arrangement / transaction Salient terms Rs in Lakhs
1 Himatsingka Holdings North America Inc. Wholly owned subsidiaries Sale of goods (net) Based on Transfer Pricing guidelines 29721
Interest income Based on Transfer Pricing guidelines 2084
Expenses incurred on behalf of Based on Transfer Pricing guidelines 535
Inter corporate loans recovered during the year As per Agreement 1391
2 Himatsingka America Inc. Wholly owned subsidiaries Sale of goods (net) Based on Transfer Pricing guidelines 49736
Sales commission As per Agreement 51
Selling expenses Based on Transfer Pricing guidelines 362
Recovery of corporate expenses As per Agreement 88
Expenses incurred on behalf of Based on Transfer Pricing guidelines 38
Expenses incurred by Based on Transfer Pricing guidelines 65

 

For and on behalf of the Board
Place: Bengaluru D.K. Himatsingka
Date : August 10 2016 Executive Chairman

Annexure 7

Conservation of energy

Particulars 2015-16 2014-15
(A) Power and fuel consumption:
1. Electricity
a) Purchased Units 9491811 9170677
Total amount Rs 59798408 61597338
Rate / unit Rs 6.30 6.72
b) Own generation
i) Through Diesel generator
Units Units 64656 97351
Units/ Litre of Diesel Oil Units 3.17 11.25
Cost / unit Rs 14.80 12.64
ii) Through Steam turbine / Generator
Units Units 89380192 97271434
Cost / unit Rs 4.74 5.60
2. Coal
Quantity Tons 93543 130776
Total amount Rs 447883871 570213407
Average rate / tonne Rs 4788 4380
3. Furnace oil
Quantity KL 25 105
Total amount Rs 1032576 4768881
Average rate / KL Rs 40605 45427
4. Other/Internal Generation
a) Liquefied Petroleum Gas
Quantity Kg 311663 330720
Total amount Rs 12941678 18440313
Average rate / kg Rs 42 56
b) Briquette Generation
Quantity Kg 2922760 2684736
Total amount Rs 17105585 15392050
Average rate / kg Rs 6 6
(B) Consumption:
Product
(a) Drapery and Upholstery fabric (per meter)
Electricity Unit 8.85 8.79
Furnace oil Litre 1.00 1.00
Coal / Others Nil Nil
Reasons for variation: Due to changes in product-mix.
(b) Spun Silk/ Blended yarns (per Kg)
Electricity Units/Kg 12.24 20.45
Furnace oil Nil Nil
Liquefied Petroleum Gas Rs/Kg 57.30 64.80
Coal / Others Nil Nil
Reasons for variation: Due to changes in product-mix.
LPG costs is higher due to higher prices.
(c) Bed linen (per set)
Electricity Unit/ set 7.89 9.30
Furnace oil Liter/set
Liquefied Petroleum Gas Rs/set 1.97 0.33
Coal / Others Rs/set 72.81 109.23

C. 1) Energy conservation measures taken:

i) Regular preventive maintenance of electric motors

ii) Installation of additional capacitor banks to improve power factor to 0.99

iii) Frequency of steam trap checking has been increased and faulty traps were replaced

iv) Installation of sky lighting and turbo ventilators to reduce the lighting loads

v) Installation of heat recovery system in boiler thermic fluid heater and processmachines to recover the heat

vi) Light fitting were fixed on loom sphere duct to increase the lux level and therebyreducing number of light fittings in weaving

vii) Higher system efficiency of boiler due to steam generated at high pressure andused at lower pressure

viii) Timers were installed for streetlights

ix) Installation of soƒ starter to reduce the energy in higher torque application

x) Electronic ballast were installed in lighting system

xi) Solar street lights installed for new locations wherever required

xii) LED Light fittings installed in general area lighting

xiii) Modification of motor circuit and lowering the capacity (HP) of twisting machines

xiv) Modification of compressed air lines inter linking & grid of compressed lines

xv) Optimizing / adjusting the humidity plant fans blade angle.

xvi)InstallationoflatestversionofAirCompressorwhichhaslowestspecificpowerconsumptionwhichhasresultedinhugeenergy saving (against 5.4 cfm/KW to 6.8 cfm/KW).

xvii) Overall ETP performance has been optimized and operation cost has been reduced inchemicals from Rs 32/Kl to Rs 28 Kl and in Power from 13 KWH/KL to 10 KWH/KL

xviii)Changeofcoalqualityfrom39%TMto35%TMwhichimprovedtheboilerefficiencyandreducedthecoalplantrunninghours

2) Impact of the measures taken for reduction of energy consumption and consequentimpact on the cost of production:

i) Improvement in productivity

ii) Improvement in the life of electrical equipments

iii) Improved efficiency and product quality

iv) Reduction in electrical energy consumption and better illumination

v) Better power factor better utilization of power plant and lower demand in KVA

vi) Optimization of compressor utilization

vii) Reduction in power requirement & Better utilization of the plants

viii) Improved efficiency of boilers.

Research and development (R&D)

a) Specific areas in which the Company carried out R&D:

i) Improvement in the quality of current products

ii) Innovation of new products and processes

iii) Development and appraisal of alternative raw materials

iv) Indigenous substitutes for imported inputs.

b) Benefits derived as a result of the above R&D:

– Improvement in the product quality and development of intricate fabric designsand weaves

c) Future plan of action

– Progression of R&D efforts towards quality enhancement evolution of newdesigns and reduction in operational costs

d) Expenditure on R&D

– For the year 2015-16 the Company incurred Rs 457.49 Lakhs towards recurringexpenditure on R&D. The total R&D expenditure as a percentage of turnover is0.36%.

Technology Absorption: a) Efforts in brief made towards technology absorption adoptionand innovations:

i) Continuous interaction with R&D divisions of overseas designers and buyers

ii) Adaptation of sophisticated technologies in developing new products and designs

iii) Installation of Quantum Clearers in winding machines to eliminate foreign fibrecontamination in spun yarn

iv) Installation of latest technology salt drying equipment to dry the waste saltgenerated in ETP which has resulted in huge saving in solid waste disposal cost

v) Installation of new equipment to augment the waste water recovery to around 93% inthe RO stages and hence reduction in quantity of water to be treated in evaporation whichhas resulted in saving of steam by around 30 TPD

b) Benefits derived as a result of the above efforts:

i) Quality improvement

ii) Reduced costs and increased productivity

c) Information regarding imported technology:

Not applicable

Foreign Exchange Earnings and Outgoings (Rs in Lakhs)
Earnings
Export (FOB Value) 93812.27
Corporate expense recovery from subsidiary 130.44
Interest 2099.41
Outgo
Import of raw material and other inputs 29652.95
Other expenses 2129.47
Net foreign exchange earnings from operations 65362.47
Import of capital goods 136.36

Annexure 8

Annual Report on Corporate Social Responsibility Activities

1. Brief Outline

Corporate Social Responsibility (CSR) is central to the operating philosophy of theCompany as it is the Company’s constant endeavour to ensure that its businessesuphold the highest standards of governance and compliance. The Company proposes to engagein one or more CSR activities falling under the list prescribed under the schedule VII ofthe Companies Act 2013. The Company has draƒed a CSR policy and the same isavailable at its website at www.himatsingka.com.

2. The composition of the CSR Committee

The Corporate Social Responsibility (CSR) committee consists of the followingdirectors:

Sl. No. As on 31st March 2016 w.e.f. 21st May 2016
1. Dr. K R S Murthy Dr. K R S Murthy
2. Mr. A K Himatsingka – N A –
3. Mr. D K Himatsingka Mr. D K Himatsingka
4. Mr. Shrikant Himatsingka Mr. Shrikant Himatsingka

3. Average net profit of the Company for last three financial years is Rs 7519.92Lakhs.

4. The prescribed CSR expenditure for the year is Rs 150.40 Lakhs taken at 2% of theabove mentioned average net profit.

5. Details of CSR spent during the financial year a) Total amount to be spent for thefinancial year was Rs 150.40 Lakhs b) Amount unspent at the end of the year was Rs 73.40Lakhs c) Manner in which the amount spent during the financial year is detailed below:

(1) (2) (3) (4) (5) (6) (7) (8)
Sl. No. CSR project or activity identified Sector in which the project is covered Location of Projects or Programs Amount outlay (budget) project or program wise (Rs) Amount spent on the projects or progarms (Rs) Cumulative expenditure upto the reporting period (Rs) Amount spent direct or through implementing agency
1. Donation towards content develop- ment and implemen- tation of e-learning class room solutions Clause ii of Schedule VII Hassan and Doddaballapur Karnataka (Local Area) 6200000 6200000 (as direct expenditure towards the project) 6200000 Spent through Children’s Lovecastles Trust (CLT)
2. Donation towards Child De- velopment and Mental Health Clause i of Schedule VII Ranchi Jharkhand 1500000 1500000 (as direct expendi- ture towards the project) 1500000 Spent through Deepshikha
Total 7700000

6. The remaining amount has not been spent. The same has been explained in theBoard’s Report.

7. The implementation and monitoring of CSR activities is in compliance with CSRobjectives and Policy of the company.

Sd/- Sd/-
Dr. K R S Murthy Shrikant Himatsingka
(Chairman CSR Committee) (Managing Director & CEO)