You are here » Home » Companies » Company Overview » CL Educate Ltd

CL Educate Ltd.

BSE: 540403 Sector: Others
NSE: CLEDUCATE ISIN Code: INE201M01011
BSE 00:00 | 12 Aug 39.75 0.25
(0.63%)
OPEN

39.95

HIGH

39.95

LOW

39.00

NSE 00:00 | 12 Aug 39.15 -0.55
(-1.39%)
OPEN

40.00

HIGH

40.00

LOW

39.00

OPEN 39.95
PREVIOUS CLOSE 39.50
VOLUME 160
52-Week high 99.80
52-Week low 28.40
P/E
Mkt Cap.(Rs cr) 56
Buy Price 31.65
Buy Qty 100.00
Sell Price 39.95
Sell Qty 135.00
OPEN 39.95
CLOSE 39.50
VOLUME 160
52-Week high 99.80
52-Week low 28.40
P/E
Mkt Cap.(Rs cr) 56
Buy Price 31.65
Buy Qty 100.00
Sell Price 39.95
Sell Qty 135.00

CL Educate Ltd. (CLEDUCATE) - Director Report

Company director report

Dear Member(s)

The Board of Directors of your Company take pleasure in presenting the Twenty ThirdAnnual Report on the business and operations of CL Educate Limited (hereinafter referredto as the "Company" or "CL") together with the Company's AuditedStandalone & Consolidated Financial Statements and the Independent Auditor's Reportthereon for the Financial Year ended March 31 2019.

1. Financial Summary and Highlights

(Rs in Lacs)

S Particulars No.

Standalone

Consolidated

FY 2019 FY 2018 FY 2019 FY 2018
I Revenue From operations 17000.96 15521.39 33925.95 28888.97
II Other income 1510.84 1344.24 1323.66 1291.23
III Total income (I+II) 18511.80 16865.63 35249.61 30180.20
IV Expenses
(a) Cost of material consumed - - 1172.61 1286.76
(b) Purchases of Stock-in-Trade 1107.21 1091.87 32.90 104.22
(c) Changes in inventories of finished goods Stock-in -Trade and work-in-progress (8.93) 10.38 (98.07) 13.49
(d) Employee benefits expense 2569.72 3213.37 5813.21 6109.56
(e) Franchisee expenses 6088.99 5877.89 6944.48 6121.53
(f) Other expenses 6309.84 5778.14 17371.88 14271.32
V Total Operating expenses 16066.84 15971.65 31237.01 27906.88
EBITDA (III-V) 2444.96 893.98 4012.60 2273.32
(g) Finance costs 428.74 340.10 619.88 642.98
(h) Depreciation and amortization expense 808.16 690.13 948.33 846.53
VI Total Expenses 17303.73 17001.88 32805.22 29396.39
Profit before tax (III-VI) 1208.07 (136.25) 2444.39 783.81
Share of profit of equity accounted investees - - 4.58 6.80
VII Profit before tax 1208.07 (136.25) 2448.97 790.60
VIII Tax expense: 227.95 62.34 678.09 466.25
IX Profit from continuing operations for the period (VII-VIII) 980.12 (198.59) 1770.88 324.36
X Profit from discontinued operations - - 226.75 249.58
XI Tax expenses of discontinued operations - - - -
XII Profit from Discontinued operations (after tax) - - 226.75 249.58
XIII Net Profit for the period (IX+XII) 980.12 (198.59) 1997.63 573.94
XIV Other Comprehensive Income 7.10 13.34 15.03 18.71
XVII Total Comprehensive Income for the period (Comprising Profit and Other comprehensive Income for the period ) (XIII+XIV) 987.22 (185.25) 2012.66 592.65
XIX Earnings per equity share (for continuing operation) excluding Other Comprehensive Income
(a) Basic 6.92 (1.40) 12.50 2.29
(b) Diluted 6.92 (1.40) 12.50 2.28
XX Earnings per equity share (for discontinued operation):
(a) Basic - - 1.60 1.76
(b) Diluted - - 1.60 1.76

2. Review of Market Business and Operations

An in-depth analysis of Markets in which CL operates along with its businesses is apart of the Management Discussion & Analysis section.

3. Segment Reporting & Operational Overview

Standalone:

Of the total revenue for the year ended March 31 2019 on a standalone basis approx.91.84% came from Operations while 8.16% came from Other Income.

The company operates in two primary segments: Consumer Test Prep and VocationalTraining. The segment have been identified and reported taking into account the nature ofproducts the differing risks and returns the organization structure and the internalfinancial reporting systems.

The Consumer division mainly consists of Test Prep which includes coaching for highereducation entrance exams like MBA BBA Law Bank SSC Civil Services GATE CA-CPT IASetc. Vocational training includes specific state and central government projectsundertaken.

The revenue from operations was solely earned from the Consumer Test Prep segment. Thiswas primarily due to the conscious decision of the company to reduce its exposure togovernment vocational projects due to its working capital-intensive nature and slowrecovery of receivables from the government. The company is at present taking no newprojects in the Vocational training space.

The segmentation of revenues by business segments on a standalone basis is as follows:

(Rs in Lacs)

Segment FY 2019 % of Total FY 2018 % of Total
Consumer test-prep 17000.96 100% 15521.39 100%
Vocational Training - 0% - 0%
Total Revenue from Operations 17000.96 100% 15521.39 100%

Our revenue from Consumer Test Prep segment increased by 9.53% from Rs. 15521.39 Lacsin FY 2018 to Rs. 17000.96 Lacs in FY 2019 primarily on the account of:

1. Introduction of New product lines - Data School FinSchool and integration ofproducts of Science Parivar (SP) Classes.

2. Introduction of conventional products on MasterClass platform

3. Successful completion of full year ICE GATE operations

4. Moving from GST inclusive pricing model on Test Prep products to GST Exclusive modelthereby improving the average price realized

The Company has identified Geographical as a Secondary Segment. The segmentation ofrevenues by geography on a standalone basis is as follows:

(Rs in Lacs)

Segment FY 2019 % of total FY 2018 % of total
Within India 16328.48 96.04% 15000.10 96.64%
Overseas 672.48 3.96% 521.29 3.36%
Total Revenue from Operations 17000.96 100.00% 15521.39 100.00%

Consolidated:

Of the total revenues for the year ended March 31 2019 on a consolidated basisapprox. 96.24% came from Operations while just 3.76% came from Other Income.

The group has identified the following reportable business segments as primarysegments:

1. Consumer Business

a. Consumer Test-Prep - Includes coaching for higher education entrance exams Like MBALaw BBA RBI Grade B GRE GMAT under the brand Career Launcher and GATE coaching underthe brand ICE GATE Institute Pvt. Ltd.

b. Consumer Publishing - Includes publishing and sale of educational books to relatedand third parties under the brand GK Publications

2. Enterprise Business

a. Enterprise Corporate - The company provides the following services to Corporateclients under the brand Kestone Integrated Marketing Services:

i. Experiential Marketing and Event Management

ii. Digital & MarComm Services

iii. Customized Engagement Programs (CEP)

iv. Manpower Management & Training

v. Strategic Business Solutions

b. Enterprise Institutional - The company provides the following services toInstitutional Clients under the brand CL Media Pvt Ltd. and Accendere Knowledge ManagementServices Pvt. Ltd. :

i. Integrated solutions to Universities

ii. Student recruitment services

iii. Research & incubation services

iv. Career Development Center

Other business segments include; reduced Vocational training and discontinued K-12Operations.

The segments have been identified and reported taking into account the nature ofproducts the differing risks and returns the organization structure and the internalfinancial reporting system.

(Rs in Lacs)

FY 2019 % of Total Revenue FY 2018 % of Total Revenue
Consumer Test-Prep 18208.02 53.67% 15826.82 54.78%
Consumer Publishing 3897.81 11.49% 4382.47 15.17%
Enterprise Corporate 12600.30 37.14% 10196.43 35.30%
Enterprise Institutional 2485.13 7.33% 1767.13 6.12%
Other segment 27.55 0.08% 13.09 0.05%
Inter-Segment Revenue (3292.86) -9.71% (3296.97) -11.41%
Total Revenue from Operations 33925.95 96.24% 28888.97 95.72%

? Our revenue from the Consumer Test Prep segment increased by 15.05% from Rs.15826.82Lacs in FY 2018 to Rs.18208.02 Lacs in FY 2019 primarily on account of:

o Increase in sale of Education & training programs by 21.98% from Rs. 12309.83lacs in FY 2018 to Rs. 15015.20 lacs in FY 2019

o Our revenue from the Consumer Publishing segment decreased by 11.06% from Rs. 4382.57Lacs in FY 2018 to Rs.3897.81 Lacs in FY 2019 due to deferment of certain exams andchange in government policy for Online distributors. The implementation of the newAccounting Standard Ind AS 115 also affected the revenues for this segment. o Ourrevenue from the Enterprise Corporate segment increased by 23.58% from Rs.10196.43 Lacsin FY 2018 to Rs.12600.30 Lacs in FY 2019 due to an increase in revenue from theIntegrated Marketing Solutions by 36.75% to Rs. 11054.75 lacs in FY 2019 as compared toRs. 8084.79 lacs in FY 2018 mainly due increase in no of international clients and a hikein the average revenue per customer

o Our revenue from Enterprise Institutional segment increased by 40.63% fromRs.1767.13 Lacs in FY 2018 to Rs.2485.13 Lacs in FY 2019 primarily due to a higherrevenue from existing clients whilst also growing the client base.

? Others includes revenue from discontinued operations and vocational training.

The Company has identified Geographical as a Secondary Segment. The segmentation ofrevenues by geographical segment on a consolidated basis is as follows:

(Rs in Lacs)

Segment FY 2019 % of total FY 2018 % of total
Within India 32511.80 95.83% 27674.43 95.80%
Overseas 1313.58 4.17% 1214.54 4.20%
Total Revenue from Operations 33925.95 100.00% 28888.97 100.00%

Detailed analysis of the performance of the company and its businesses has beenpresented in the Management Discussion and Analysis section which forms a part of thisreport.

4. Change in the nature of business if any

There was no change in the nature of business of the Company during the year underreview.

5. Scheme of Amalgamation

Pursuant to the recommendations/approval of the Audit Committee and the Board ofDirectors of the Company both dated November 27 2018 an application under Regulation 37of the SEBI (LODR) Regulations 2015 was filed with the National Stock Exchange of IndiaLimited ("NSE") and BSE Limited ("BSE") for the proposed Amalgamationof 5 wholly owned subsidiary Companies of CL Educate Limited - Career Launcher EducationInfrastructure and Services Limited CL Media Private Limited Accendere KnowledgeManagement Services Private Limited G.K. Publications Private Limited and KestoneIntegrated Marketing Services Private Limited with CL Educate Limited.

The scheme has been approved by the NSE & BSE. The Company shall file the firstmotion petition with the Honorable NCLT Chandigarh shortly.

The rationale for the scheme and likely benefits accrued has been discussed in theManagement Discussion and Analysis section which forms a part of this report.

6. Details of Subsidiaries/Joint Ventures/Associate Companies as on the date of thisReport

As on date CL Educate Limited has 9 (nine) subsidiaries (including 3 (three) indirectsubsidiaries) and 2 (two) associate companies to carry on its business activities such asimparting education and training programmes publishing digital marketing providingresearch related services to Institutions and Universities etc. A brief profile of oursubsidiaries and associate companies is given hereunder:

a. Kestone Integrated Marketing Services Private Limited (Kestone)

Kestone was acquired as a wholly owned subsidiary of the Company on April 01 2008.Under our brand Kestone we enjoy strong relationship with corporates to whom we provideour integrated business marketing and sales services. Kestone focuses on a wide varietyof Corporates across various segments and industries.

Kestone provides integrated business marketing and sales services to our corporatecustomers including event management marketing support (including digital marketingsupport in the form of online marketing initiatives to support offline marketingcampaigns) customer engagement (including audience generation lead generation loyaltyand reward programs and contest management) managed manpower and training services.

The total income of Kestone was INR 12126 Lacs in Financial Year 2019 as against INR9815 Lacs in Financial Year 2018 recording an increase by 23.54 % over the previousFinancial Year. The growth in business was driven in part by additional revenues fromBritannia who had engaged with the group for its 100 year celebration.

a.1. Kestone CL Asia Hub PTE. Ltd. Singapore (Kestone CL Asia)

Kestone CL Asia Hub Pte. Ltd. (Previously Known as ‘Kestone Asia Hub Pte. Ltd')Singapore is a Step-Down Subsidiary of

the Company. Kestone CL Asia started doing business in Singapore from Financial Year2016-17. It is currently engaged in providing integrated marketing solutions for productsand services to conduct educational & consulting programs research related servicesetc. for and on behalf of inland and overseas clients and customers. Kestone CL Asia hasalso started a branch office in Dubai inter alia to provide integrated sales &marketing service to corporates & institutions in Middle East.

The total income of Kestone CL Asia has declined from INR 694.80 Lacs in Financial Year2018 to about INR 641.09 Lacs in Financial Year 2019 thus reflecting a decline of 8.83%.The dip in revenues is on account of a contract in the previous financial which wasawarded to the Singapore subsidiary which this year grew in scope and was handed over tothe parent entity for execution in India. Revenue net of the aforementioned transactiongrew substantially from FY 2018 to FY 2019.

a. 2. Kestone CL US Limited Delaware USA (Kestone CL US)

Kestone CL Asia has incorporated a wholly owned subsidiary in USA on March 22 2018 inthe name of Kestone CL US Limited with an objective to provide integrated sales &marketing services to corporates & institutions in USA. Over the course of theFinancial Year Kestone CL US earned revenues of $28416.15.

b. CL Media Private Limited (CL Media)

CL Media as a wholly owned subsidiary of CL was incorporated on February 01 2008. CLMedia provides integrated solutions to educational institutions and universities includingbusiness advisory and outreach support services.

CL Media is currently engaged in the business of content development for studymaterial publishing study material and books and providing sales & marketing servicesand research related services to Institutions and Universities.

The business has shown growth and the total income of CL Media was INR 4598 Lacs inFinancial Year 2019 as against INR 4084 Lacs in Financial Year 2018 an increase of12.58% over the previous Financial Year.

c. G.K. Publications Private Limited (GKP)

GKP was acquired as a subsidiary of the Company on November 12 2011. GKP is now awholly owned subsidiary of the Company. GKP is currently engaged in the business ofdistribution of test preparation guides books and other academic material.

The total income of GKP has decreased from about INR 1884 Lacs in Financial Year 2018to about INR 1488 Lacs in Financial Year 2019 thus reflecting a 21.02% decline. This ispredominantly on account of adoption of IND AS 115 for sales return and increasedprovisioning of expected credit loss. If one were to negate the impact of the twoaforementioned accounting standards the business did not decline over the course of theyear.

d. Accendere Knowledge Management Services Private Limited (AKMS)

AKMS was incorporated under the Companies Act 1956 on September 19 2008. It became awholly owned subsidiary of the Company on April 12 2017. AKMS is currently engaged in thebusiness of facilitating educational institutions and establishing their institutionalcredibility international presence and thought leadership by improving their researchoutput in terms of both the quality and quantity of research articles published by them.

The business of AKMS has shown significant growth and the total income has increasedfrom about INR 278 Lacs in Financial Year 2018 to about INR 382 Lacs in Financial Year2019 thus reflecting a 37.64% growth.

e. Career Launcher Education Infrastructure and Services Limited (CLEIS)

Incorporated on June 16 2005 CLEIS is a wholly owned subsidiary of the Company as ondate. Engaged in the business of providing various infrastructure facilities soft skillseducational and consulting programs the business of CLEIS has since been transferreddetails of which are given below.

Pursuant to a Business Transfer Agreement dated March 16 2017 amended on July 182017 executed amongst CLEIS and B&S Strategy Services Private Limited with CL as aconfirming party the business of running and operating pre-schools and providing schoolmanagement services carried on by CLEIS has since been sold off.

e.1. Career Launcher Infrastructure Private Limited (CLIP)

CLIP a wholly owned subsidiary of CLEIS and hence an indirect subsidiary of CL wasincorporated on February 20 2008. CLIP is engaged in the business of providinginfrastructure facilities for K-12 schools operating under the brand Indus World School.

In March 2017 the group had entered into a Business Transfer Agreement with I-TakeCare Private Limited for the sale of its K-12 infrastructure services business carried onby CLIP. The K-12 business operations are disclosed as discontinued operations in theFinancial Statements. However the transaction is pending closure. Your management intendsto sell the assets and is in discussion with parties for the same.

e. 2. B&S Strategy Services Private Limited (B&S) Associate Company of CLEIS

B&S was incorporated under the Companies Act 1956 on April 09 2009. B&S ismainly engaged in the business of rendering consulting services in the education sectorand managing schools. As on March 31 2019 CL Educate Limited through its wholly ownedsubsidiary company CLEIS held 44.18% of the voting rights in B&S Keeping in mindCompany's significant stake in B&S an associate company of CLEIS the details ofB&S are being shared at the relevant places in this Annual Report.

The business of B&S has shown a decline over the current financial year with thetotal income having decreased from about INR 331 Lacs in Financial Year 2018 to about INR302 Lacs in Financial Year 2019 thus reflecting an 8.65% decline. The drop in revenues ison account of a decline in student admissions as a result of the company discontinuing itsunprofitable chain of feeder playschools.

f. ICE GATE Educational Institute Private Limited (ICE GATE)

ICE GATE was incorporated under the Companies Act 2013 on August 12 2015. ICE GATE isengaged in the business of providing education for students preparing for GraduateAptitude Test in Engineering (GATE) and related exams. Pursuant to the Share Purchase cumShareholders Agreement entered into amongst CL ICE GATE and its Promoters dated October18 2017 CL acquired 50.70% stake (5070 equity shares) in ICE GATE for an aggregatepurchase consideration of 623.61 Lacs. ICE GATE became a subsidiary of the Company witheffect from October 31 2017. The Company has agreed to acquire remaining 49.3%shareholding in ICE GATE over a period of 60 months from the date of the above Agreement.

The total income of ICE GATE was INR 1236 Lacs in Financial Year 2019 as against INR661 Lacs in Financial Year 2018 recording an increase of 86.89% over the previousFinancial Year.

g. Threesixtyone Degree Minds Consulting Private Limited (361DM) Associate Company

361DM incorporated under the Companies Act 1956 on July 06 2006 delivers largescale yet effective learning and education solutions to individuals organizations andeducational institutions. Pursuant to the Investment cum Shareholders Agreement datedAugust 03 2017 entered into amongst the Company 361DM and its Promoters the Companyholds 500000 5% Compulsorily Convertible Preference Shares of 361DM of INR 10 eachissued at a premium of INR 90/- per share. The Company also holds 909 Equity shares of361DM aggregating to 4.41% of paid-up equity share capital of 361DM.

The total income of 361DM was INR 636 Lacs in Financial Year 2019 as against INR 458Lacs in Financial Year 2018 thereby increasing by 38.88% over the previous FinancialYear.

Change in the status of subsidiaries/associate companies/joint venture during theFinancial Year:

There was no change in the status of subsidiaries/associate companies/joint venturesduring the Financial Year 2018-19. No Company became or ceased to be the Company'ssubsidiary joint venture or associate company during the year.

Pursuant to Section 129(3) of the Act read with Rule 5 of the Companies (Accounts)Rules 2014 a statement containing salient features of the Financial Statements of theCompany's Subsidiaries and Associate companies in Form AOC-1 is attached to this report asAnnexure-I.

Pursuant to the provisions of Section 136 of the Act the Audited Standalone &Consolidated Financial Statements of the

Company along with the Audited Financial Statements of its Subsidiaries and Associatesare available on the website of the Company at the web linkhttp://www.cleducate.com/financial.html .

Shareholding in Subsidiary Companies

As on March 31 2019 the Company's shareholding in its direct subsidiaries was asfollows:

a. 1000000 Equity Shares of Rs 10 each comprising of 100% Equity Share Capital inKestone Integrated Marketing Services Private Limited;

b. 190000 Equity Shares of Rs 10 each comprising of 100% Equity Share Capital in G.K. Publications Private Limited;

c. 10000 Equity Shares of Rs 10 each comprising of 100% Equity Share Capital in CLMedia Private Limited;

d. 12000 Equity shares of Rs 10 each comprising of 100% Equity Share Capital inAccendere Knowledge Management Services Private Limited;

e. 9447606 Equity Shares of Rs 10 each comprising of 100% Equity Share Capital inCareer Launcher Education Infrastructure and Services Limited; and

f. 5070 Equity Shares of Rs 10 each comprising of 50.70% Equity Share Capital in ICEGATE Educational Institute Private Limited.

Shareholding in Associate Companies

As on March 31 2019 the Company's holding in its Associate Companies was as follows:

a. 500000 5% Convertible Preference Shares of Rs 10 each comprising of 80.65% ofPreference Share Capital in Threesixtyone Degree Minds Consulting Private Limited;

b. 909 Equity shares of Rs 10 each comprising of 4.41% of Equity Share Capital inThreesixtyone Degree Minds Consulting Private Limited; and

c. 44.18% of the voting rights in B&S Strategy Services Private Limited throughits wholly owned subsidiary company Career Launcher Education Infrastructure and ServicesLimited (CLEIS).

7. Corporate Governance

Pursuant to applicable provisions of the SEBI (LODR) Regulations 2015 a detailedreport on Corporate Governance forms part of this Annual Report. A certificate from M/s.S. Anantha & Ved LLP Company Secretaries (LLP IN: AAH-8229) confirming compliance ofthe conditions of Corporate Governance as stipulated under the Listing Regulations formspart of this Report.

8. Management Discussion & Analysis

Management Discussion and Analysis (MDA) Report for the Financial Year 2018-19 on theoperations and state of affairs of your Company as stipulated under Regulation 34 of SEBI(LODR) Regulations 2015 is given in a separate section forming part of this AnnualReport.

9. Dividend

During the Year under review the Board of Directors declared an interim dividend @ 10%(Re. 1/- per equity share of face value of Rs. 10/- each). The interim dividend declaredon August 07 2018 was paid on August 28 2018.

Considering the business growth plans the Board of Directors does not recommend anyfurther Dividend for the Financial Year 2018-19.

The Dividend policy of the Company (voluntarily adopted by the Board of Directors) isavailable on the website of the Company at the web linkhttp://www.cleducate.com/policies/Dividend-Policy.pdf .

10. Transfer of unclaimed dividend to Investor Education and Protection Fund

There is no amount which is required to be transferred to the Investor Education andProtection Fund as per the provisions of Section 125(2) of the Act.

11. Transfer to Reserves

The Board of Directors has decided to retain the entire amount of profits for FinancialYear 2018-19 in the Profit and Loss Account.

12. Capital and Finance

The paid up Equity Share Capital of the Company as on March 31 2019 was INR 1416.57Lacs. During the year under review the Company has not issued any shares. The Company hasnot issued shares with differential voting rights. It has neither issued employee stockoptions nor sweat equity shares and does not have any scheme to fund its employees topurchase shares of the Company.

During the Financial Year 2018-19 Kestone obtained long term borrowings from TataCapital of INR 750 lacs bearing 12% interest rate to meet its increasing Working Capitalrequirements on account of the business having grown nearly 24%. This changes the Debt toEquity ratio of the company from 0.16 to 0.17. The aforementioned loan will be repaidthrough an equal monthly payout scheme of INR 20.83 lacs over a three (3) year period.

As mandated by the Ministry of Corporate Affairs the financial statements for the yearended on March 31 2019 has been prepared in accordance with the Indian AccountingStandards (Ind AS) notified under Section 133 of the Companies Act 2013 (hereinafterreferred to as "The Act") read with the Companies (Accounts) Rules 2014 asamended from time to time. The estimates and judgements relating to the FinancialStatements are made on a prudent basis so as to reflect in a true and fair manner theform and substance of transactions and reasonably present the Company's state of affairsprofits and cash flows for the year ended March 31 2019. The Notes to the FinancialStatements adequately cover the standalone and consolidated Audited Statements and form anintegral part of this Report.

13. Material changes and commitments

No material changes and commitments affecting the financial position of the Companyhave occurred between end of Financial Year and the date of this report.

14. Material and Significant Orders Passed By Regulators & Courts

There are no significant material orders passed by any Regulators or Courts orTribunals against the Company which would impact the going concern status of the Companyand its future operations.

15. Internal Financial Control Systems

The Company has aligned its current system of Internal Financial Controls with therequirements of the Companies Act 2013. The Internal Control Systems are intended toincrease transparency and accountability in an organisation's process of designing andimplementing a system of internal control. The framework requires a company to identifyand analyse risks and manage appropriate responses. The Company has successfully laid downthe framework and ensured its effectiveness. The Company's internal controls arecommensurate with its size and the nature of its operations. These have been designed toprovide reasonable assurance with regard to recording and providing reliable financial andoperational information complying with applicable statutes safeguarding assets fromunauthorised use executing transactions with proper authorisation and ensuring complianceof corporate policies. CL has a well-defined delegation of power with authority limits forapproving revenue as well as expenditure. Processes for formulating and reviewing annualand long term business plans have been laid down. CL uses a state-of-the-art enterpriseresource planning (ERP) system to record data for accounting consolidation and managementinformation purposes and connects to different locations for efficient exchange ofinformation. It has continued its efforts to align all its processes and controls withbest practices.

Your management assessed the effectiveness of the Company's internal control overfinancial reporting as of March 31 2019. The assessment involved management reviewinternal audit and statutory audit.

The Internal Controls over Financial Reporting are routinely tested and reported byStatutory as well as Internal Auditors in a process that involves a review of theinternal controls and risks in its operations and processes such as IT and generalcontrols accounting and finance procurement employee engagement etc.

During the year under review the internal audit was conducted based on the risk-basedinternal audit plan approved by the Audit Committee. Significant audit observations andfollow up actions thereon were reported to the Audit Committee.

Pursuant to Section 143 of the Act the Statutory Auditor has issued an attestationreport on our Internal Financial Controls over financial reporting.

Qualified opinion by Statutory Auditors on adequacy and operating effectiveness ofInternal Financial Controls over Financial Reporting for CL on a Standalone basis:

a) The company's internal financial control in respect of authorisation of purchase ofgoods and services was not operating effectively which could potentially result in theCompany procuring unnecessary goods and services or procuring goods of lower quality orprocure goods and services at higher prices.

Management Response:

A revised procurement policy has been implemented and approved by the Directors thesame includes a built-in authority matrix which is being followed through a completelyautomated system. Purchase requisition purchase order and receipt of material arerecorded in the ERP module and bills linked to such purchase order are marked and approvedas per the authority matrix. However the new online system experienced some teethingtroubles which have since been rectified.

b) The company's internal financial controls in respect of obtaining periodic balanceconfirmation and preparation of reconciliation of receivables/payables were not operatingeffectively during the year which may result in unwarranted disputes and over/understatement of party balances.

Management Response:

The company is following the Pareto principle of getting balance confirmations andreconciling accounts from those vendors / customers who account for the bulk of thebusiness. This typically used to be an annual exercise which has since been migrated to aquarterly progress. The company will work towards automating this process over the courseof this financial year.

Qualified opinion by Statutory Auditors on adequacy and operating effectiveness ofInternal Financial Controls over Financial Reporting for CL on a Consolidated basis:

a) The company's internal financial control in respect of authorisation of purchase ofgoods and services was not operating effectively which could potentially result in theCompany procuring unnecessary goods and services or procuring goods of lower quality orprocure goods and services at higher prices.

Management Response:

A revised procurement policy has been implemented and approved by the Directors thesame includes a built-in authority matrix which is being followed through a completelyautomated system. Purchase requisition purchase order and receipt of material arerecorded in the ERP module and bills linked to such purchase order are marked and approvedas per the authority matrix. However the new online system experienced some teethingtroubles which have since been rectified.

b) The company's internal financial controls in respect of obtaining periodic balanceconfirmation and preparation of reconciliation of receivables/payables were not operatingeffectively during the year which may result in unwarranted disputes and over/understatement of party balances.

Management Response:

The company is following the Pareto principle of getting balance confirmations andreconciling accounts from those vendors / customers who account for the bulk of thebusiness. This typically used to be an annual exercise which has since been migrated to aquarterly progress. The company will work towards automating this process over the courseof this financial year.

c) In case of one of its subsidiaries Kestone Integrated Marketing Services PrivateLimited Comprehensive procurement policies for purchase of goods and services have notbeen documented which could potentially result in the aforesaid Company

procuring unnecessary goods and services or procuring goods of Lower quality orprocure goods and services at higher prices.

Management Response:

A separate procurement policy is used by Kestone Integrated Management Services PrivateLimited for goods and services. For services quotations are taken from empanelled vendorsbefore selection and this is done by the relevant divisional head with the approval ofthe President. For goods procurement is primarily done in the events management business.A budget is defined for every event within the APEX ERP and any spends are done withinsaid budget.

16. Public Deposits

Your Company has not invited or accepted any deposits from the pubLic/members and thereare no outstanding deposits as on March 31 2019.

17. Auditors and Auditors' Report

Re-appointment of Statutory Auditor

At the AGM held in the year 2014 M/s Haribhakti & Co. LLP Chartered Accountants(Firm Registration No. - 103523W) was appointed as the Statutory Auditor of the Companyfor a term of five years i.e. tiLL the conclusion of the 23rd AGM to be heldin the year 2019.

Looking at the provisions of the Companies Act 2013 M/s. Haribhakti & Co. LLPChartered Accountants is eligible to be re-appointed as the Statutory Auditor of theCompany for a second and Last term of 1 (One) year i.e. for the Financial Year 2019-20.Pursuant to the recommendation of the Audit Committee and subject to the approval of theshareholders the Board of Directors has at its meeting held on May 29 2019re-appointed M/s. Haribhakti & Co. LLP Chartered Accountants as the Statutory Auditorof the Company for the Financial Year 2019-20.

The Company has received written consent and a certificate from the Statutory Auditorstating that they satisfy the eligibility criteria provided under Section 141 of the Actread with the rules made thereunder and that the appointment if approved by the membersof the Company shall be within the prescribed Limits and confirming that they are notdisqualified for such appointment pursuant to the appLicabLe provisions of the Act and theruLes made thereunder.

M/s. Haribhakti & Co. LLP Chartered Accountants has confirmed that it has beensubjected to the peer review process of the Institute of Chartered Accountants of India(ICAI) and it hoLds a vaLid certificate issued by the Peer Review Board of the ICAI.

In this respect the Members are requested to approve the re-appointment of M/sHaribhakti & Co. LLP Chartered Accountants as the Statutory Auditor of the Companyfor a further term of 1 (One) year to hoLd office from the concLusion of the 23rdAnnuaL GeneraL Meeting untiL the concLusion of the 24th AnnuaL GeneraL Meetingof the Company (to be heLd in the year 2020) and to fix their remuneration in this regard.

In this connection the attention of the members is invited to item number 4 of theNotice convening the 23rd AnnuaL GeneraL Meeting of the Company.

Fees paid/payable to Statutory Auditors

The TotaL Fee (ExcLuding other expenses and taxes if any) for aLL services paid/payabLe by CL Educate Limited and its subsidiaries on a consoLidated basis to theStatutory Auditor and aLL entities in the network firm/network entity of which theStatutory Auditor is a part for the FinanciaL Year 2018-19 is mentioned beLow:

(Rs in Lacs)

S. No. Particulars CL Educate Kestone GKP CL Media CLEIS CLIP
a. Statutory Audit Fees 23.00 9.00 4.00 4.50 1.25 1.25
b. Audit of ConsoLidated FinanciaLs 4.00 - - - - -
c. Limited Review Fees (for three quarters) 18.00 - - - - -
d. Other assignments Fees (Special Audit for the half year ended September 30 2019) 4.00 1.75 1.75 0.50
Total 45.00 13.00 5.75 6.25 1.75 1.25

Statutory Auditor's Report

The qualification contained in the Statutory Auditor's report/CARO Report and themanagement's response thereon is given

below:

Qualification on Consolidated Financial Statements:

a) Qualified Opinion

We refer to the qualification which is included by the other statutory auditor of ICEGate Educational Institute Private Limited in the Basis of Qualification paragraph intheir audit report: The Company has more than 10 employees on its roll as at March 312019. However the Company has not registered itself under the provisions of The EmployeesProvident Fund & Miscellaneous Provisions Act 1952 and The Employees State InsuranceAct 1948. The impact of such non-compliance if any is not ascertainable.

Management Response:

This was on account of the Company adding additional employees late in the FinancialYear which took it over the registration threshold. The above matter has been subsequentlyrectified and company has obtained relevant registrations under EPF & MiscellaneousProvisions Act 1952 and The Employee State Insurance Act 1948.

b) CARO Qualification(s)

i. According to the information and explanations given to us and based on the auditprocedures conducted by us we are of the opinion that the terms and conditions of loansgranted by the Company to a parties covered in the register maintained under Section 189of the Act (total loan amount granted Rs. 12.13 Lacs and balance outstanding as atbalance sheet date Rs.542.43 Lacs) are prejudicial to the Company's interest on account ofthe fact that the Company is not charging any interest on such loan.

ii. According to the information and explanations given to us in respect of loansinvestments guarantees and securities the Company has complied with the provisions ofSection 185 and 186 of the Act except for the details given below:

(Rs in Lacs)

Nature of Non-Compliance Name of company/party Amount Involved Balance as at March 31 2019
Interest is not charged on loan Career Launcher Education Foundation 12.13 542.43

Management Response:

In view of there being no current operations of CLEF (one Party) the loan amountremained dormant during this Financial Year and for the interest of CL the outstandingloan amount has been guaranteed by our Promoter entity Blakes Consulting Private Limited.

Secretarial Auditor

Pursuant to the provisions of Section 204 of the Act read with Rule 9 of Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 and Regulation 24A ofthe SEBI (LODR) Regulations 2015 your Directors have on the recommendation of the AuditCommittee appointed M/s. S. Anantha & Ved LLP Company Secretaries Mumbai (LLP IN:AAH-8229) as the Secretarial Auditor of the Company for the Financial Year 2018-19 and2019-20. The Secretarial Audit Report for the Financial Year 2018-19 issued by theSecretarial Auditor does not contain any qualification reservation or adverse remark. Thesame is annexed as Annexure II A.

Secretarial Audit of Material Unlisted Subsidiaries:

The Secretarial Audit Report for the Company's material unlisted subsidiaries i.e.Kestone Integrated Marketing Services Private Limited (Kestone) and Career LauncherEducation Infrastructure and Services Limited (CLEIS) for the financial year ended March31 2019 has been issued by M/s. Jain D & Co. Company Secretaries (C.P No.: 11434)and the same is annexed as Annexure II B.

Internal Auditor

Pursuant to the provisions of Section 138 of the Act and the Companies (Accounts)Rules 2014 on the recommendation of the Audit Committee Value Square Advisors PrivateLimited Business Advisors and Chartered Accountants have been appointed by the Board ofDirectors to conduct internal audit for the Company.

Cost Auditor

Pursuant to the provisions of Section 148 of the Act read with the Companies (CostRecords and Audit) Rules 2014 and the Notification dated December 31 2014 issued by theMinistry of Corporate Affairs your Company is required to get its cost records audited bya cost auditor.

Your Directors have on the recommendation of the Audit Committee appointed M/s. SunnyChhabra & Co. Cost Accountants as the Cost Auditor of the Company. The Cost AuditReport 2018-19 issued by the Cost Auditor does not contain any qualification observationor adverse remark. The same shall be placed before the members at the ensuing AGM.

On the recommendation of the Audit Committee M/s. Sunny Chhabra & Co. CostAccountants has been appointed as the Cost Auditor of the Company for the Financial Year2019-20 by the Board. The remuneration payable to the cost auditor is subject toratification/approval by the members of the Company. Accordingly a resolution seekingmembers' ratification/ approval for the remuneration payable to the Cost auditor isincluded in the Notice convening the 23rd Annual General Meeting along withthe relevant details including the proposed remuneration.

Reporting of fraud by Auditors

During the year under review no instance of fraud has been reported by the StatutoryAuditor Cost Auditor Internal Auditor or the Secretarial Auditor.

18. Directors and Key Managerial Personnel

a. Appointments & Cessations during the Financial Year 2018-19:

i. Mr. Sridar Iyengar Non-Executive Independent Director of the Company resigned fromthe Board of the Company on and with effect from September 30 2018.

ii. Mr. Girish Shivani was appointed as an Additional (Non-Executive Independent)Director on the Board of the Company on and with effect from September 30 2018.

iii. Mr. Sudhir Bhargava a Key Managerial Personnel of the Company resigned from theposition of Chief Financial Officer on and with effect from October 13 2018.

iv. Mr. Arjun Wadhwa was appointed as the Chief Financial Officer a Key ManagerialPersonnel of the Company on and with effect from October 15 2018.

v. Mr. Gopal Jain Non-Executive Non-Independent Director of the Company resigned fromthe Board of the Company on and with effect from November 02 2018.

vi. Mr. Imran Jafar was appointed as an Additional (Non-Executive Non-Independent)Director on the Board of the Company on and with effect from November 02 2018.

vii. Mr. Paresh Surendra Thakker Non-Executive Independent Director of the Companyresigned from the Board of the Company on and with effect from November 15 2018.

b. Appointments & Cessations from the end of Financial Year i.e. March 31 2019till the date of this Report

i.e. August 05 2019:

Mr. SushiL Kumar Roongta Non-Executive Independent Director of the Company resignedfrom the Board of the Company on and with effect from July 26 2019.

The Directors placed on record their appreciation for the valuable contribution made byMr. Sridar Iyengar Mr. Gopal Jain Mr. Paresh Surendra Thakker and Mr. Sushil KumarRoongta as Directors on the Board of the Company and by Mr. Sudhir Bhargava as the ChiefFinancial Officer of the Company during their association with the Company.

c. Retirement by Rotation:

Mr. Satya Narayanan R (DIN: 00307326) Chairman and Executive Director retires byrotation at the ensuing Annual General Meeting and being eligible offers himself forre-appointment. A resolution seeking members' approval to the appointment of Mr. SatyaNarayanan R has been incorporated in the notice convening the 23rd AnnualGeneral Meeting (AGM 2019) of the Company.

d. Proposed Re-appointments at the ensuing AGM:

i. Mr. Girish Shivani who was appointed as an Additional (Non-Executive Independent)Director by the Board of Directors of the Company holds office till the date of theensuing AGM unless appointed thereat. The proposal to appoint Mr. Girish Shivani as aNon-Executive Independent Director forms part of the Notice of the AGM 2019.

ii. Mr. Imran Jafar who was appointed as an Additional (Non-Executive Non Independent)Director by the Board of Directors of the Company holds office till the date of theensuing AGM unless appointed thereat. The proposal to appoint Mr. Imran Jafar as aNon-Executive Non Independent Director forms part of the Notice of the AGM 2019.

iii. The First Term of 5 years of Mr. Viraj Tyagi as an Independent Director expires onSeptember 04 2019. On the recommendation of the NRC Committee the Board has approved there-appointment of Mr. Viraj Tyagi as an Independent Director for a 2nd term of 5 yearscommencing from September 05 2019 up to September 04 2024. The proposal to re-appointMr. Viraj Tyagi forms part of the Notice AGM 2019.

iv. At the Annual General Meeting of the Company held on September 21 2016 themembers of the Company had approved the appointments of and the overall maximummanagerial remuneration payable to Mr. Satya Narayanan R Mr. Gautam Puri and Mr. NikhilMahajan as Executive Directors of the Company for a period of 3 years i.e. from April 012017 to March 31 2020.

On the recommendation of the NRC Committee and subject to the approval of the membersthe Board has approved the re-appointment of Mr. Satya Narayanan R Mr. Gautam Puri andMr. Nikhil Mahajan as the Executive Directors of the Company for a further period of 3(three) years beginning April 01 2020 till March 31 2023 as well as the overall maximumremuneration that may be paid to them for these 3 years. The proposal seeking approval ofthe shareholders to the same forms part of the Notice AGM 2019.

In the opinion of the Board Mr. Girish Shivani Mr. Viraj Tyagi Mr. Imran Jafar Mr.Satya Narayanan R Mr. Gautam Puri and Mr. Nikhil Mahajan possess the requisitequalifications and experience to enable them to contribute effectively to the growth ofthe Company. Hence the Board recommends their appointment/re-appointment.

e. Declaration by Independent Directors

Pursuant to sub-section (7) of Section 149 of the Act the Company has receiveddeclaration from the Independent Directors that they meet the criteria of independencelaid down in Section 149(6) of the Act and Regulation 16(1)(b) of SEBI (LODR) Regulations2015 and that there was no change in their status as Independent Directors during theFinancial Year 2018-19.

A brief profile of each Independent Director on Board of the Company along with theterms and conditions of appointment of Independent Directors are available on the websiteof the Company at the web link http://www.cleducate.com/advisory- board.html andhttp://www.cleducate.com/policies/Draft-Appointment-Letter.pdf .

f. Separate Meeting of Independent Directors

Pursuant to the requirements of Schedule IV of the Act during the Financial Year2018-19 the Independent Directors of the Company met separately on January 31 2019 tointer-alia;

a. Review the performance of Non-Independent Directors and the Board as a whole;

b. Review the performance of the Chairperson of the Company; and

c. Assess the quality quantity and timeliness of flow of information between theCompany Management and the Board that is necessary for the Board to effectively andreasonably perform their duties.

g. Disclosure of Interest in other concerns

The Company has received the Annual disclosure(s) from all the Directors disclosingtheir Directorship/Interest in other concerns in the prescribed format for the FinancialYears 2018-19 and 2019-20.

The Company has received confirmation from all the Directors that as on March 31 2019none of the Directors were disqualified to act as Directors by virtue of the provisions ofSection 164(2) of the Act or were debarred from holding the office of Director by virtueof any SEBI Order or any other such authority.

h. Details of Board & Committee Meetings held during the Financial Year 2018-19

The Board of Directors of the Company met 8 (Eight) times during the Financial Yearunder review. The details of the meetings of the Board including those of its Committeesand of the Independent Directors are given in the Report on the Corporate Governanceforming part of this Annual Report.

i. Annual Evaluation by the Board

The Nomination Remuneration and Compensation Committee (NRC Committee) and the Boardhas adopted a methodology for performance evaluation of the Board committees independentdirectors and non- independent directors of the Company which includes criteria mannerand process for performance evaluation. Criteria in this respect includes; the Boardcomposition and structure effectiveness of board processes information and functioningcontribution of the individual director to the board and committee meetings likepreparedness on the issues to be discussed meaningful and constructive contribution andinputs in meetings etc.

Evaluation of Performance of the Board its committees every director and Chairpersonfor the Financial Year 2018-19 has been done as per the adopted methodology which includesreview discussion and feedback from directors.

j. Key Managerial Personnel

As on March 31 2019 the following persons were the designated Key ManagerialPersonnel of the Company pursuant to Section 2(51) and Section 203 of the Act read withthe rules made thereunder:

a. Mr. Satya Narayanan R Chairman & Executive Director

b. Mr. Gautam Puri Vice Chairman & Managing Director

c. Mr. Nikhil Mahajan Executive Director and Group CEO Enterprise Business

d. Ms. Rachna Sharma Company Secretary and Compliance Officer and

e. Mr. Arjun Wadhwa Chief Financial Officer (with effect from October 15 2018).

19.Composition of Audit Committee

Audit Committee of the Board is duly constituted in accordance with the provisions ofSection 177 (8) of the Act read with Rule 6 of the Companies (Meetings of the Board andits Powers) Rules 2013 and Regulation 18 of the SEBI (LODR) Regulations 2015. Thedetails of its composition powers functions meetings held during the Financial Year2018-19 etc. are given in the Report on Corporate Governance forming part of this AnnualReport. All recommendations of the Audit Committee were accepted by the Board during theFinancial Year 2018-19.

20. Vigil Mechanism / Whistle Blower Policy

Your Company has established a Vigil Mechanism/ Whistle Blower Policy in compliancewith the provisions of Section 177(9) and (10) of the Act read with Rule 7 of theCompanies (Meetings of the Board and its Powers) Rules 2013 and Regulation 22 of SEBI(LODR) Regulations 2015 and Regulation 9A of SEBI (Prohibition of Insider Trading)Regulations 2015 to enable stakeholders (including Directors Employees retainersfranchisees) to report unethical behavior actual or suspected fraud or violation of theCompany's Code of Conduct or instances of leak of unpublished price sensitive information.The Policy provides adequate safeguards against victimization of Director(s)/ employee(s)and provides for direct access to the Chairman of the Audit Committee in exceptionalcases. The Protected Disclosures if any reported under this Policy are to beappropriately and expeditiously investigated by the Ethics Committee. Your Company herebyaffirms that no Director/ employee has been denied access to the Chairman of the AuditCommittee and that no complaints were received during the Financial Year under review. TheVigil Mechanism/ Whistle Blower Policy is available on the website of the Company at theweb link http://www.cleducate.com/policies/Vigil_Mechanism_Policy_CLEducate.pdf .

21. Corporate Social Responsibility

Pursuant to Section 135 of the Act read with the Companies (Corporate SocialResponsibility Policy) Rules 2014 your Company has constituted a Corporate SocialResponsibility Committee (the "CSR Committee"). The Composition and the terms ofreference of the CSR Committee are provided in the Report on Corporate Governance formingpart of this Annual Report. The CSR Policy is available on the website of the Company atthe web link http://www.cleducate.com/policies/CL%20 Educate%20Limited_CSR%20Policy.pdf.

CSR Funds (Past & Present):

Particulars Amount (Rs in Lacs)
CSR Funds required to be spent during Financial Year 2018-19 7.10
Accumulated CSR Funds since the date of applicability of CSR provisions on the 53.41
Company:
CSR amount spent in the Financial Year 2018-19 21.20
CSR Amount pending to be spent (on a cumulative basis) (as on March 31 2019) 32.21

The Company spent the CSR amount directly without any external agency involved.

During the Financial Year 2018-19 the CSR spend of the Company was more than theamount due to be spent calculated as per the provisions of Section 135 of the CompaniesAct 2013.

Further projects are being undertaken by the Company to spend the allocated funds inline with the policy approved by the CSR Committee.

The Annual report on CSR Activities is annexed as Annexure- III.

22. Risk Management Policy

Although there was no mandatory requirement of having a Risk Management Committee inthe Company (applicable to top 500 listed entities determined on the basis of marketcapitalisation as at the end of the immediate previous Financial Year) however theCompany has voluntarily constituted an Internal Risk Management Committee to identify andassess the key risk areas oversee the risk mitigation strategies and implementationthereof.

The Risk Management Committee has been dissloved with effect from August 05 2019.

23. Directors' Nomination and Remuneration

The Nomination Remuneration and Compensation Committee (NRC Committee) of the Companyformulates the criteria for determining qualifications positive attributes andindependence of a director and recommends to the Board the criteria for determining theremuneration for the Directors key managerial personnel and/or other senior levelemployees of the Company.

The process of determining the Remuneration of the Directors is initiated with thegeneral body of shareholders approving the overall maximum managerial remuneration thatmay be paid to the Directors generally over a period of 3 years. Within this overalllimit the actual payout is decided by the Board on the specific recommendation of theNRC Committee (comprising of all Non-Executive Directors with majority of them beingindependent) while keeping the provisions of the Companies Act 2013 in mind.

Details of the Remuneration Recommended by NRC Committee for the Financial Year2018-19:

(Rs in Lacs)

Executive Director Fixed Compensation Variable

Compensation

Total Compensation
1 Mr. Satya Narayanan R 81.90 41.00 122.90
2 Mr. Gautam Puri 81.90 41.00 122.90
3 Mr. Nikhil Mahajan 79.70 39.70 119.40

Details of the Remuneration paid/payable to Executive Directors for the Financial Year2018-19:

(Rs in Lacs)

S. No. Executive Director Fixed Compensation Variable

Compensation1

Total Compensation3
1 Mr. Satya Narayanan R 74.63 41.00 115.63
2 Mr. Gautam Puri 70.91 41.00 111.91
3 Mr. Nikhil Mahajan2 76.792 39.70 116.49

Variable part of compensation pertaining to FY 2018-19 shall be paid to the Directorsin the Financial Year 2019-20.

includes an amount equivalent to 120000 AED that is the remuneration payable to Mr.Nikhil Mahajan out of Company's Dubai business operations. Out of this an amountequivalent to 90000 AED (9 months' compensation) was paid to Mr. Nikhil Mahajan duringthe Financial Year 2018-19. The remaining amount (equivalent to 30000 AED pertaining to3 months' compensation) shall be paid to him during the financial year 2019-20.

 3 Includes Variable part of compensation pertaining to Financial Year2018-19 that shall be paid to the Directors in the Financial Year 2019-20.

Commission payable to Non-Executive Directors for the Financial Year 2018-19:

(Rs in Lacs)

S. No. Non-Executive Independent Directors

Commission 2018-19

Recommended (% of Net Profits) Amount to be Paid (on a pro-rata basis)
1 Mr. Girish Shivani1 0.15% of the net profits 0.95
2 Mr. Viraj Tyagi 0.15% of the net profits 1.89
3 Ms. Madhumita Ganguli 0.15% of the net profits 1.89
4 Mr. Sridar Iyengar2 0.25% of the net profits 1.57
5 Mr. Paresh Thakker3 0.15% of the net profits 1.18
6 Mr. Sushil Kumar Roongta4 0.15% of the net profits 1.89

 1Mr. Girish Shivani was appointed as an Additional (Non-ExecutiveIndependent) Director on the Board of the Company on and with effect September 30 2018.

 2Mr. Sridar Iyengar Non-Executive Independent Director of the Companyresigned from the Board of the Company on and with effect from September 30 2018 and hehas waived off his commission payment (as well as sitting fee) for the Financial Year2018-19.

 3Mr. Paresh Surendra Thakker Non-Executive Independent Director ofthe Company resigned from the Board of the Company on and with effect from November152018 and he has waived off all monetary benefits (commission as well as sitting fee)arising from CL Educate Limited.

 4Mr. Sushil Kumar Roongta Non-Executive Independent Director of theCompany resigned from the Board of the Company on and with effect from July 26 2019.

The Remuneration policy (Recommendation report of NRC Committee for the Financial Year2018-19) is available on the website of the Company at the web linkhttp://www.cleducate.com/policies/recommendation-report-of-nrc-committee-2018-19.pdf .Salient features of the process of determination of the Remuneration of Directors arementioned below:

i. Approval of the Shareholders:

The general body of shareholders approves the overall maximum managerial remunerationthat may be paid to the Directors (Executive as well as Non-Executive) generally over aperiod of 3 years.

ii. Recommendation to the Board by the NRC Committee:

Within the overall limit approved by the shareholders the remuneration payable for aparticular year is recommended by the NRC Committee (comprising of all non-executiveDirectors with majority of them being independent) to the Board taking into account thefollowing key considerations:

a. For Executive Directors:

i) The provisions of Companies Act 2013 and any other law for the time being in forcerelating to Companies;

ii) Market factors;

iii) The executive and operational responsibilities carried out by the Directors forthe Company;

iv) Market salary of people with similar background/educational qualification/experience to ensure that Directors receive a fair compensation and there is"headroom" to pay competitive salaries to the Director's direct reports and forattracting new talent in the Company;

v) Compensation trends for the past years; and

vi) Inflation index;

The NRC Committee recommends the split between fixed and variable salaries payable tothe Executive Directors of the Company for any Financial Year.

For calculating the variable compensation to be actually paid to the ExecutiveDirectors for any Financial Year NRC Committee considers the % achievement vs. budget ontwo metrics- Total Revenue and Total EBIDTA giving equal weightage (50% each) to the twometrics according to a pre-decided formula. Audited results are used for all actualperformance metrics. If audited results are not available then latest interim results areused.

b. For Non-Executive Directors:

i) The provisions of Companies Act 2013 and any other law for the time being in forcerelating to Companies;

ii) Number of meetings attended by the director during the year

iii) Contribution to the Board and Committees and

iv) Participation in the Board matters.

iii. Approval by the Board:

Based on the recommendation of the NRC Committee the Board approves the remunerationin whatever form payable to the Directors for the year.

iv. Ensuring Compliance with the Companies Act 2013

At the year end the Remuneration paid/payable during/for the year is checked againstthe provisional profitability position of the Company in order to comply with therelevant provisions of the Companies Act 2013 and the Rules made thereunder.

24. Particulars of Employees

People are our most valuable asset and your Company places the engagement developmentand retention of talent as its highest priority to enable achievement of organizationalvision.

The relevant information required to be provided under Section 197(12) of the Act readwith Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 is given in Annexure - IV.

The relevant information required to be provided under Section 197(12) of the Act readwith Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Amendment Rules 2016 is given in Annexure - V.

25. Policy on Prevention Prohibition and Redressal of Sexual Harassment at Workplace

The Company has a policy against sexual harassment at workplace and has constitutedInternal Complaints Committee and complied with provisions in this respect as applicableunder the Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013. There was no complaint received from any employee during the year nor is anycomplaint pending or outstanding for redressal as on March 31 2019.

The Company's Policy on sexual harassment at workplace is available on the website ofthe Company at the web link http://www.cleducate.com/policies/Policy-against-Sexual-Harassment.pdf .

26. Particulars of Loans Guarantees and Investments

Details of loans Guarantees and Investments covered under the provisions of Section186 of the Act are given in the notes to the Financial Statements.

27. Particulars of Contracts or Arrangements with Related Parties

All arrangements or transactions entered by the Company with Related Parties during theFinancial Year 2018-19 were in the Ordinary Course of Business and on an Arm's Lengthpricing basis. All Related party transactions are placed for approval before the AuditCommittee and are brought to the notice of the Board on a periodic basis.

During the year under review the Company has not entered into anycontracts/arrangements/transactions with related parties which could be considered asmaterial in accordance with the policy of the Company on material related partytransactions or under Section 188(1) of the Act. Accordingly there are no particulars toreport in Form AOC-2.

Details of the Related Party Transactions as required under Listing Regulations andthe relevant Accounting Standards are given in note no. 45 to the Standalone FinancialStatements.

The Company's Policy on Materiality of Related Party Transactions and on dealing withRelated Party Transactions is available on the website of the Company at the web linkhttp://www.cleducate.com/policies/RPT_Policy_CLEdcuate.pdf .

28. Extract of Annual Return

Pursuant to Section 92 of the Act read with Rule 12 of the Companies (Management andAdministration) Rules 2014 the extract of the Annual Return in prescribed Form MGT-9 isattached as Annexure - VI to this Report.

The extract of Annual Return is also available on the website of the Company at the weblink http://www.cleducate.com /pdf/agm/2019/CL-Educate-MGT-9_Extract-of-Annual-Report_2018-19.pdf.

29. Details of the Amended and Restated CL ESOP Plan 2014 (Formerly known as CL ESOPPlan 2008)

The Company's ESOP Plan - Career Launcher Employee Stock Options Plan 2014 ("CLESOP Plan 2014" or "ESOP Scheme") is administered and monitored by theNomination Remuneration & Compensation Committee of the Board.

During the Financial Year 2018-19;

• The Company renewed its ESOP Scheme for a period of 3 years i.e. from September05 2018 to September 04 2021;

• No fresh grants were made under the ESOP Scheme; and

• No material change was made to the ESOP Scheme.

The Scheme is in compliance with the SEBI (Share Based Employees Benefits) Regulations2014. A certificate from the Statutory Auditor of the Company with regard to theimplementation of the CL ESOP Plan 2014 being in line with the SEBI (Share Based EmployeesBenefits) Regulations 2014 would be placed at the ensuing Annual General Meeting.

The details as required to be disclosed under the Act and SEBI (Share Based EmployeeBenefits) Regulations 2014 are available at the website of the Company at the followingweb link http://www.cleducate.com/policies/CL-Educate-ESOP-Disclosure-for-year-ended-31-03-2019.pdf .

30. Disclosure of Energy conservation Technology Absorption & Foreign ExchangeEarnings & Outgo

The Company does not carry any manufacturing activity. However wherever possible andfeasible continuous efforts have been made for conservation of energy and to minimizeenergy costs and to upgrade the technology with a view to increase the efficiency and toreduce cost of operations.

At CL our aim is to transform the way students learn. With the advent of artificialintelligence and industry 4.0 technologies which promise to transform our everyday livesit becomes imperative for us to utilize them to significantly impact learning outcomes.

In this pursuit of transforming the way our students learn every year we developed ourAI-enabled platform christened as Aspiration.ai. This platform brings together variousintuitive features that come together to make this a truly smart experience.

1. CAT Percentile Predictor (CAT PP): Take for example the CAT percentile predictorwhich has over the years correctly predicted the CAT percentiles of many students up tothe second digit after the decimal point. CAT PP works on a model that takes into accounta student's performance in the mocks. That coupled with the database of students we haveaccumulated over the years gives the model the desired accuracy.

2. IIM Profilizer: It is one of our most important efforts to add value to thestudents' preparation. IIM Profilizer helps the students by giving them a true picture ofwhich IIMs and B-schools can they really make it to and at what percentile. This is a toolthat is AI-driven and has been patented by CL a few years ago and has continued to makestudents more focused in their preparation since then.

3. Support Chatbot: In order to improve the user experience and quick resolution ofqueries a chatbot is deployed in our aspiration.ai dashboard. This is currently in itsBeta state and over the course of its existence garnered a user-rating of 3.8/5 which isa result of continuous improvements in our technological systems.

4. Identity Stitching: With the help of a 3rd party tool Snowplow today we are ableto stitch the user identity and the behavior coming in from various sources. The result ofthis is our DMP data which gives the complete and exact picture of the user journey on ourdigital property. It includes crucial things right from the user source up till thepurchase and post-purchase stages.

5. AI-driven Digital Marketing: While the DMP data gives our marketing efforts a bigboost we utilize AI algorithms to deploy the outcomes of the user analysis. For examplewe utilize the user experience (depicted through the Lead Score) to algorithmically decidewhich advertorial banner to show to the user on the website. This has taken our marketingto an extremely personalized level.

6. Sales and Academic Nudges: Basis the analysis of the user intent we show our onlinee-store visitor relevant nudges. These nudges improve the users' confidence in theproduct. This is a result of our analysis of the user-intent so that relevant nudges canbe shown to the audience.

These and other such efforts continue to serve students who are our paramountimportance.

During the Financial Year under review the Foreign Exchange earnings and outgo were asfollows:

The foreign exchange earnings (on Standalone basis):

(Rs in Lacs)

Particulars FY 2019 FY 2018
Test preparation training services 253.41 228.74
Sale of study material 419.06 288.02
Other income 11.56 4.54
Total 684.03 521.30

The foreign exchange outgo (on accrual basis) (on Standalone basis):

(Rs in Lacs)

Particulars FY 2019 FY 2018
Travelling and conveyance 9.17 9.41
Bank charges 10.72 7.77
Rent 116.26 106.93
Salary and wages 75.52 259.45
Faculty expenses 84.58 61.91
Others 440.32 380.11
Total 736.57 825.58

31. Secretarial Standards issued by the Institute of Company Secretaries of India(ICSI)

Your Company complies with the mandatory Secretarial Standards issued by the ICSI.

32. Statement of Deviation(s) or Variation(s) if any in the Projected Utilization ofNet Proceeds

The Audit Committee as well as the Board of Directors of the Company review and monitorthe utilization of the Proceeds from the IPO on a quarterly basis at their respectivequarterly meetings.

There has been no deviation in the use of the IPO proceeds from the objects stated inthe Offer Document. Neither has there been any deviation between the actual expenditureand the projected utilisation of funds made by the Company in its Offer Document.

The statement indicating utilization of funds raised from the Company's Initial PublicOffering (IPO) as on March 31 2019 is given hereunder:

(Rs in Lacs)

Objects Amount as per prospectus Utilised till March 31 2019
Repayment of loan taken by Career Launcher Infrastructure Private Limited (a stepdown subsidiary) from HDFC Limited 1860.40 1860.40
Meeting the working capital requirements of CL Educate and its subsidiaries namely Kestone Integrated Marketing Services Private Limited and GK Publications Private Limited 5250.00 5250.00
Funding acquisitions and other strategic initiatives 2000.00 2000.00
General corporate purposes *1010.25 1010.25
Total 10120.65 10120.65

The details of utilisation against the IPO proceeds for Funding acquisition and otherstrategic initiatives is as below:

(Rs in Lacs)

Name of Companies
Accendere Knowledge Management Services Private Limited 661.50
ICE Gate Educational Institute Private Limited 623.61
Indiacan Education Private Limited 300.00
Three Sixty One Degree Minds Consulting Private Limited (361 DM) 414.89
Total 2000.00

The Company has fully utilised the IPO proceeds against objects stated in the Offerdocument without there being any deviation between the actual expenditure and theprojected utilisation of funds made by it in its Offer Document.

The aforesaid statement as reviewed by the Audit Committee and the Board of Directorsof the Company is also available on the website of the Company at the web linkhttp://www.cleducate.com/pdf/Statement-of-Utilisation-of-IPO-Proceeds-as-on-March-31-2019.pdf ..

33. Directors' Responsibility Statement

To the best of our knowledge and belief and according to the information andexplanations obtained by us the Board of Directors make the following statements in termsof Section 134(3)(c) of the Act:

a. in the preparation of the Annual Accounts for the Financial Year ended March 312019 the applicable accounting standards have been followed along with proper explanationrelating to material departures if any;

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 as at the end of the Financial Year endedMarch 31 2019 and of the Profits 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 Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

d. the Directors have prepared the Annual Financial Statements/Annual Accounts on a'going concern' basis;

e. the Directors have laid down Internal Financial Controls to be followed by theCompany and that such Internal Financial Controls are adequate and are operatingeffectively; and

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

34. Acknowledgement

Your Directors take this opportunity to thank the Company's customers shareholdersvendors and bankers for their support and look forward to their continued support in thefuture.

Your Directors also place on record their appreciation for the excellent contributionmade by all employees who are committed to strong work ethics excellence in performanceand commendable teamwork and have thrived in a challenging environment.

For and on behalf of Board of Directors of
CL Educate Limited
sd/- sd/-
Gautam Puri Nikhil Mahajan
Vice Chairman & MD Executive Director & Group CEO Enterprise Business
DIN:00033548 DIN: 00033404
Address: R-90 Greater Kailash-I Address: House No. 457 Sector - 30
New Delhi - 110 048 Faridabad - 121 003 Haryana
Place: New Delhi
Date: August 05 2019