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Gati Ltd.

BSE: 532345 Sector: Services
NSE: GATI ISIN Code: INE152B01027
BSE 00:00 | 15 Oct 57.80 2.65






NSE 00:00 | 15 Oct 57.80 2.60






OPEN 55.00
VOLUME 114750
52-Week high 94.85
52-Week low 35.50
P/E 38.79
Mkt Cap.(Rs cr) 627
Buy Price 57.00
Buy Qty 477.00
Sell Price 57.80
Sell Qty 1001.00
OPEN 55.00
CLOSE 55.15
VOLUME 114750
52-Week high 94.85
52-Week low 35.50
P/E 38.79
Mkt Cap.(Rs cr) 627
Buy Price 57.00
Buy Qty 477.00
Sell Price 57.80
Sell Qty 1001.00

Gati Ltd. (GATI) - Director Report

Company director report

Dear Members

Your Directors have great pleasure in presenting the report of the Business andOperations of your Company (‘the Company' or ‘Gati') along with the auditedfinancial statements for the financial year ended March 31 2018. The ConsolidatedPerformance of your Company and its subsidiaries has been referred to wherever required.

Financial Highlights
Rs in mn)
Particulars Consolidated Standalone
2017-18 2016-17 2017-18 2016-17
Total Income 18136 17014 5247 5240
Profit before Finance Cost Depreciation & 1550 1063 886 468
Amortization Expenses Exceptional items & Tax
Less: Finance cost 470 500 193 218
Less : Depreciation and Amortization Expenses 300 298 50 51
Profit before tax & Exceptional items 780 265 643 199
Less: Exceptional items 236 - 236 -
Profit before tax 544 265 407 199
Less: Tax expenses 153 94 62 23
Profit after tax 391 171 345 176
Attributable to
Owners of the company 342 108 345 176
Non –controlling Interest 49 63 - -
Add: other comprehensive Income (net of Tax) (99) 2 2 6
Total comprehensive income 292 173 347 182
Attributable to
Owners of the company 243 110 347 182
Non –controlling Interest 49 63 - -

Your Company has been mandated to adopt Ind AS with effect from 1st April 2017pursuant to Ministry of Corporate Affairs notification dated 16th February 2015 notifyingthe Companies (Indian Accounting Standard) Rules 2015.

Your Company has published Ind AS Financials for the year ended 31st March 2018 alongwith comparable as on 31st March 2017 and Opening Statement of Assets and Liabilities ason 1st April 2016.

The reconciliations and descriptions of the effect of the transition from previous GAAPto Ind AS have been set out in Note 42 in the notes to accounts in the standalonefinancial statement and in Note 54 in the notes to accounts in the consolidated financialstatement.


Your Directors have recommended dividend of 45% (H 0.90 per share) for the financialyear ended March 31 2018 (previous year 40%) subject to the approval of the shareholdersat the ensuing annual general meeting.

Review of Operations

At standalone level your Company recorded a revenue of H 5247 mn EBITDA of H 886 mnPBT of H 407 mn and PAT of H 345 mn as against a revenue of H 5240 mn EBITDA of H 468 mnPBT of H 199 mn and PAT of H 176 mn in the previous year.

During the year under review at consolidated level your Company achieved a revenue ofH 18136 mn EBITDA of H 1550 mn PBT of H 544 mn and PAT of H 391 mn as against arevenue of H 17014 mn EBITDA of H 1063 mn PBT of H 265 mn and PAT of H 171 mnrespectively in the previous year.

Company's performance

Efficient Logistics has been at the heart of India's retail internet growth. Logisticsdecisions influence the e-tailer's businesses in aspects ranging from standardizedcustomer experience to unit delivery economics. The online retail market in India in 2017was estimated at US$17.8 billion in terms of gross merchandise value

(GMV) and grew from US$ 14.5 billion in 2016 at the rate of 23% (Source: KPMG)signalling a rather moderate year for e-Commerce.

Consequently with emphasis on sustaining the profitability during this period yourcompany's e-commerce segment saw the docket volumes drop close to 40% between FY 2016-17and FY 2017-18. However the overall weight fell less than 10% during the same period asyour company steered to increase the share of higher-weight shipments. During the yearunder review the e-Commerce division of your company has recorded revenue of H 1597 mnas against H 2170 mn in the previous period.

While the domestic e-Commerce market growth has been moderate in 2017 the expectedgrowth rate in 2018 is at 60 per cent. The impending consolidation within the e-commercemarket specially the entry of newer participants with long-term vision to become the"everything store" is expected to shape the future of domestic retail.Additionally from your company's perspective the entry of Supply Chain focussedenterprises is anticipated to bring about reinvention of logistics management practices inthe industry. The e-commerce ecosystem is expected to progress towards collaborativelogistics and your company with its wide-ranging portfolio of services will be aformidable player in this arena.

Your company's freight forwarding division which deals in Air/Ocean freight servicescoupled with Customs House agency services saw a drop in revenues from H 661 mn in FY2016-17 to H 465 mn in FY 2017-18. The scaling down of business was a deliberate move torestrict the business to direct customer business only and prevent agency-relatedbusiness.

Your Company operates in petrol and diesel retail segment along with other motor partsand lubricants through its fuel stations division under the Standalone business.Presently it runs five fuel stations mostly in South and Central India. The fuel stationbusiness grew from H 2150 mn in FY 2016-17 to H 2399 mn in FY 2017-18. Your companyanticipates the increase in dealer margin to benefit the profitability of the divisiongoing forward.


Gati-Kintetsu Express Pvt Ltd. (GKEPL)

GKEPL is India's pioneer and leader in Express Distribution and Supply Chain Solutionsand offers an unmatched service offering that brings in local experience with globalexpertise. During the year under review GKEPL recorded revenue of H 11695 mn EBITDA ofH 743 mn and PAT of H 310 mn against a revenue of H 11131 mn EBITDA of H 759 mn and PATof H 315 mn in the previous year.

At the onset of FY2017-18 the core B2B Surface Express volume grew at more than 5%over the same quarter of FY2016-17. This was a reversal from the historical seasonalitywhere the business experienced a volume growth from Q4 FY2016-17 to Q1 FY2017-18.Additionally the high-yield retail portfolio contribution crossed 25% for the first timein almost eight quarters. These were positive indicators that our business had stabilizedfollowing the implementation of the ambitious Shop-Floor automation in FY2017. However Q2FY2018 had a rather sluggish start across industry sector on account of GST roll-out onJuly 1st. The customer industry sectors themselves had to go through the transition. Afterthe initial jitters your company experienced a strong resurgence with core surfacevolumes showing double digit growth in second half of FY2018. Business Development focuson Key Enterprise Accounts (KEA) Customer Service focus on organic growth and operationsfocus on de-growing and lost customers helped deliver double-digit growth across customersegment. Air volumes also showed double-digit growth in fourth quarter.

Going forward your company is encouraged by a number of factors that will contributeto the long-term growth of the GKEPL portfolio. Adapting to the changing logisticsstructure in the post-GST environment your company has taken a series of major networkimprovisations and combined it with an enhanced product portfolio to cater to the evolvingneeds of its customers across industry verticals. Your company is undertaking significantexpansions across eight critical logistics nodes adding up to 8 lakh square feet. Thiswill result in the two-fold plus increase in the distribution and warehousing capacitiesat these vital supply chain demand points. Your company has recently purchased 125 newtrucks in March and is further looking at fuel efficient electric vehicles on a pilotbasis for intra-city service operations in the next quarter. Your company now throughcombination of its superior ground infrastructure and air network promises next day andsame day delivery to a 100 km radius around 8 metro locations. Extending its leadership asa truly multi-modal player your company has been awarded a new train lease tender by theIndian Railways for the Kolkata – Mumbai - Kolkata rail route starting with a 700+tonnes capacity in a round trip. The train has been flagged off on 22nd March 2018. Yourcompany's kiosk network increased by around 50% and coupled with other measures resultedin an increased demand in the B2C segment of the retail business.

Gati Kausar India Ltd. (GKIL)

India's cold chain sector forms the backbone of the food processing and food serviceindustry providing cold storage and refrigerated transportation for a range of businessesincluding Packaged Foods Quick Service Restaurants Pharmaceuticals Animal ProteinFresh Fruit and Vegetables. Increasing consumer demand for quality processed food;stringent regulations for food safety and focus on Good Distribution Practices (GDP) inpharmaceuticals have all helped generate greater need for high-quality cold supply chainsolutions. GKIL already has a visible presence in refrigerated transportation and servesmany a number of popular brands. New Business Development and short-term strategyresulting in increased warehousing utilization on SCM and increased distance run on FTLside. The "Percentage Empty kilometres run" also has been showing a decliningtrend.

During the year under review Gati Kausar recorded a revenue of H 390 mn EBITDA lossof H 44 mn and Loss of H 223 mn against a revenue of H 441 mn EBITDA loss of H 5 mn andLoss of H 155 mn in the previous period.

Going forward the company endeavours to disrupt the Cold Chain market with suchquality design and differentiated services to build a proud Cold chain business. Anetwork of Refrigerated Express Distribution Centers across the country will help yourcompany provide differentiated end-to-end Cold Chain solutions to customers by providingtime-definite cold chain delivery services.

Gati Import Export Trading Limited (GIETL)

GIETL Wholly-Owned Subsidiary works with select clients to provide innovativeGST-ready approaches to traditional distribution and facilitate regional access to globalenterprises. For FY 2017-18 due to volume increases from key customers revenuesincreased from H 592 mn in FY 2016-17 to H 792 mn in FY 2017-18. Your company's strategyis to grow the high-yield Importer of Record (IOR) services for overseas sellers lookingto grow their e-Commerce market in India.

Gati Asia Pacific Pte. Ltd. (APAC)

Your company's APAC subsidiary revenues increased from H 444 mn in FY 2016-17 to H 767mn in FY 2017-18 mainly supported by China-India express volume increase due to growingcross-border e-commerce. Going forward your company will continue to support sellers ononline platforms to participate in Cross-Border e-Commerce to grow APAC volumes.

Consolidated Financial Statements (CFS)

During the year the Board of Directors reviewed the affairs of the subsidiaries. Inaccordance with Section 129(3) of the Companies Act 2013 your company has prepared theconsolidated financial statements of the company which forms part of this Annual Reportin compliance with applicable provisions of the Companies Act 2013 read with the Rulesissued thereunder applicable accounting standards and the provisions of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 (hereinafter referred to as the"Listing Regulations"). Your Company and its subsidiaries has adopted Ind ASfrom April 1 2017 and accordingly the consolidated financial statements have beenprepared on the basis of audited financial statements of your Company its subsidiariesas approved by the respective Board of Directors. The Consolidated Financial Statementstogether with the Auditors' Report form part of this Annual Report.

A separate statement containing the salient features of financial statement of allsubsidiaries of the company in the prescribed Form AOC – 1 forms a part ofconsolidated financial statements in compliance with Section 129(3) and other applicableprovisions if any of the Companies Act 2013 read with Rule 5 of the Companies(Accounts) Rules 2014. The said Form also highlights the financial performance of each ofthe subsidiaries is included in the consolidated financial statements of the Companypursuant to Rule 8(1) of the Companies (Accounts) Rules 2014.

In accordance with Section 136 of the Companies Act 2013 the financial statements ofthe subsidiary companies are available for inspection by the members at the RegisteredOffice of the company during the business hours on all days except Saturdays Sundays andpublic holidays upto the date of the Annual General Meeting (‘AGM'). Any memberdesirous of obtaining a copy of the said financial statements may write to the CompanySecretary at the Registered Office of the Company. The financial statements including theconsolidated financial statements and all other documents required to be attached to thisreport have been uploaded on the website of the Company (


On a standalone basis your directors have decided to retain the entire amount of H344.76 mn in the retained earnings.

Fixed deposits (FD)

As on March 31 2018 fixed deposits of your Company stood at H 145.76 mn out of whichH 9.31 mn remain unclaimed and there were no overdue deposits as on that date. During theyear under review your Company has accepted deposits to the tune of H 93.21 mn. There wasno default in repayment of deposits or payment of interest thereon during the year andthere are no deposits which are in non-compliance with the requirements of the CompaniesAct 2013. The current fixed deposits carry a rating of "A Minus" issued byCredit Analysis and Research Limited (CARE).

Directors and Key Managerial Personnel (KMP)

In accordance with the provisions of Section 152 of the Companies Act 2013 Mr.Yasuhiro Kaneda Director who retires by rotation and being eligible has offer himselffor re-appointment.

In compliance with Regulation 36(3) of the Listing Regulations brief resume of all theDirector proposed to be appointed / re-appointed are attached along with the Notice of theensuing Annual General Meeting.

Apart from the above there have been no changes in Directors and KMP.

Particulars of Employees and related disclosures

The remuneration paid to your Directors is in accordance with the Nomination andRemuneration Policy formulated in accordance with Section 178 of the Companies Act 2013and Regulation 19 of the Listing Regulations. The salient aspects covered in theNomination and Remuneration Policy have been outlined in the Corporate Governance Reportwhich forms part of this report.

The information required under section 197 of the Companies Act 2013 read withCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 (includingany statutory modification(s) or re-enactment(s) thereof for the time being in force) inrespect of Directors/employees of the Company is set out in the Annexure –A tothis report

Declaration on Independent Directors

Pursuant to sub section (6) of Section 149 of the Companies Act 2013 and Regulation16(1)(b) of the Listing Regulations all the Independent Directors of your Company havegiven declaration that they have met the criteria of independence as required under theAct and the regulations.

Remuneration Policy

Your Directors have on the recommendation of the Nomination

& Remuneration Committee framed a policy for selection and appointment ofDirector(s) Senior Management Personnel and their remuneration. The Remuneration Policyforms part of the Corporate Governance Report.

Board Evaluation

Pursuant to the provisions of the Companies Act 2013 and the Listing Regulations theevaluation of all the directors and the Board as a whole was conducted based on thecriteria and framework adopted by the Board and in line with the Guidance Note on BoardEvaluation issued by the Securities and Exchange Board of India on January 5 2017. Theevaluation process has been explained in the Corporate Governance Report.

Board Committees

Detailed composition of the Board committees namely Audit Committee Nomination andRemuneration Committee Corporate Social Responsibility Committee StakeholdersRelationship Committee and Foreign Currency Convertible Committee number of meetings heldduring the year under review and other related details are set out in the CorporateGovernance Report which forms a part of this Report.

Audit committee

The details pertaining to the composition of the audit committee are included in theCorporate Governance Report which is a part of this report.

All the recommendations made by the Audit Committee were accepted by the Board ofDirectors of the Company.

Particulars of Loans Guarantees and Investments

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 read with the Companies (Meetings of Board and its Powers)Rules 2014 forms part of the Financial Statements.

Corporate Social Responsibility (CSR)

In terms of section 135 and Schedule VII of the Companies Act 2013 read with Companies(Corporate Social Responsibility Policy) Rules 2014 made thereunder the Board ofDirectors of your Company have constituted a CSR Committee.

The brief outline of the Corporate Social Responsibility (CSR) Policy of your Companyand the initiatives undertaken on CSR activities during the year are set out in Annexure-Bof this report in the format prescribed in the Companies (Corporate Social ResponsibilityPolicy) Rules 2014. The policy is available on the Company's website.

Related PartyTransactions

In line with the requirements of the Companies Act 2013 and Listing Regulations yourCompany has formulated a Policy on Related Party Transactions which is also available onthe Company's website at The Policy intends to ensure that proper reportingapproval and disclosure processes are in place for all transactions between the Companyand Related Parties.

Related party transactions that were entered during the financial year were on an arm'slength basis and were in the ordinary course of business. There were no material relatedparty transactions i.e. transactions exceeding 10% of the annual consolidated turnover asper the last audited financial statement were entered during the year by your Company.Accordingly the disclosure of Related Party Transactions as required under Section134(3)(h) of the Companies Act 2013 in Form AOC-2 is not applicable.

Meetings of the Board and Committees

Five Meetings of the Board of Directors were held during the year. For details of themeetings of the Board please refer to the report on Corporate Governance which formspart of this report.

Vigil Mechanism

The Whistle-blower Policy has been approved and adopted by Board of Directors of theCompany in compliance with the provisions of Section 177 (10) of the Companies Act 2013and Regulation 22 of the Listing Regulations. Further the Whistle-blower Policy isavailable on the website of your company at

Policy on Prevention of Sexual Harassment at Workplace

As per the requirement of the Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 (‘POSH Act') and Rules made thereunder yourCompany has constituted Internal Committees (IC).

The Company has taken several initiative across the organization to build awarenessamongst employees about the Policy and the provisions of Prevention of Sexual Harassmentof Women at Workplace Act.

During the financial year 2017-18 no complaint of sexual harassment were received bythe Company.

Familiarisation Programme for Independent Directors

Pursuant to the Listing Regulations the Company shall familiarise the IndependentDirectors with the Company their roles rights responsibilities in the Company natureof the industry in which the Company operates business model of the Company etc..

The details of the Familiarisation programme process for the Independent Directorsforms part of the Corporate Governance Report.

Directors' Responsibility Statement

Pursuant to the requirement under section 134(5) of the Companies Act 2013 withrespect to the Directors' Responsibility Statement relating to the Company (Standalone)it is hereby confirmed:

1. That in the preparation of the Accounts for the financial year ended March 31 2018the applicable accounting standards and schedule III of the Companies Act 2013 (includingany statutory modification(s) or re-enactment(s) for the time being in force) have beenfollowed along with the proper explanation relating to material departure;

2. That the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at March 31 2018 andof the profit and loss of the Company for the financial year ended March 31 2018;

3. That proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 (includingany statutory modification(s) or re-enactment(s) for the time being in force) forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

4. That the accounts have been prepared on ‘going concern' basis;

5. The directors had laid down internal financial controls to be followed by thecompany and such internal financial controls are adequate and the Company is constantlyendeavouring to improve the standards of internal control in various areas and takingsteps to strengthen the internal control system to make it commensurate and effective withthe nature of its business;

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

Extract of Annual Return

The details forming part of the extract of the Annual Return in Form MGT-9 inaccordance with Section 92(3) of the Companies Act 2013 read with Companies (Managementand Administration) Rules 2014 is annexed as Annexure – C.

Development and Implementation of Risk Management Policy

The company has a well-defined process in place to ensure appropriate identificationand treatment of risks. Risk identification exercise is inter-woven with the annualplanning cycle which ensures both regularity and comprehensiveness. The identification ofrisk is done at strategic business operational and process levels. While the mitigationplan and actions for risks belonging to strategic business and key critical operationalrisks are driven by senior leadership for rest of the risks operating managers drivesthe conception and subsequent auctioning of mitigation plans.

All risks are well integrated with functional and business plans and are reviewed on aregular basis by the senior leadership.

The Company through its risk management process aims to contain the risks within itsrisk appetite. There are no risks which in the opinion of the Board threaten the existenceof the Company. However some of the risks which may pose challenges are set out in theManagement Discussion and Analysis which forms part of this Annual Report.

Internal Financial Controls

Your Company has established and maintained a framework of internal financial controlsand compliance systems. Based on the framework of internal financial controls andcompliance systems established and maintained by the Company the work performed by theinternal statutory and secretarial auditors and external consultants including the auditof internal financial controls over financial reporting by the statutory auditors and thereviews performed by management and the relevant board committees including the auditcommittee the Board is of the opinion that the Company's internal financial controls wereadequate and your Company is constantly endeavouring to improve the standards of internalcontrol in various areas and taking steps to strengthen the internal control system tomake it commensurate and effective with the nature of its business.

Further the statutory auditors of your company have also issued an attestation reporton internal control over financial reporting (as defined in section 143 of Companies Act2013) for the financial year ended March 31 2018 which forms part to the StatutoryAuditors Report.

Investor Education and Protection Fund

Pursuant to the applicable provisions of the Companies Act 2013 read with InvestorEducation and Protection Fund Authority (Accounting Audit Transfer and Refund) Rules2016 (‘the Rules') all unpaid or unclaimed dividend are required to be transferredby the company to the IEPF established by the Central Government after the completion ofseven years. Further according to the Rules the share in respect of which dividend hasnot been paid or claimed by the shareholders for seven consecutive years or more shallalso be transferred to demat account created by the IEPF Authority. Accordingly thecompany has transferred the unclaimed and unpaid dividend of H 377727/- pertaining tothe FY 2009-10. Further 455138 corresponding shares were transferred as per therequirement of IEPF rules. The details are also available on our website


a) Statutory Auditors

M/s. Singhi & Co. Chartered Accountants (Firm Registration No. 304045E) wereappointed as Statutory Auditors of the Company at the 22nd AGM till the conclusion of the27th AGM. In accordance with the Companies Amendment Act 2017 enforced on 7th May 2018by the Ministry of Corporate Affairs the appointment of Statutory Auditors is notrequired to be ratified at every Annual General Meeting.

The standalone and consolidated financial statements of the Company have been preparedin accordance with the Indian Accounting Standards prescribed under Section 133 of the Actread with relevant rules issued thereunder (Ind AS) and other accounting principlesgenerally accepted in India.

The Auditors' Report for the financial year ended March 31 2018 on the financialstatement of the Company is a part of this Annual Report. The Auditors have given aqualified opinion on the standalone and consolidated financial statements of the Companyas described below:

(i) Auditors Qualification and Emphasis of Matter given in point no. 6 & 8 of theAuditor's Report on standalone financial statements read with Note 6 13 & 16(f) ofthe standalone financial statements are self-explanatory and do not call for any furthercomments.

(ii) Auditors Qualification and Emphasis of Matter given in point no. 6 & 8 of theAuditor's Report on consolidated financial statements read with Note 18 35 59 & 60of the consolidated financial statements are self-explanatory and do not call for anyfurther comments.

b) Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of

Managerial Personnel) Rules 2014 your Company has appointed M/s. DVM & AssociatesLLP to undertake the Secretarial Audit of your Company. The Report of the SecretarialAudit is annexed as Annexure – D. The Secretarial Auditors have given aqualified opinion which is described as below:

"During the year under review the Company have a slight delay in filling upvacancy in the office of Chief Financial Officer as required under Section 203(4) of theCompanies Act 2013. "

Board's Comment:

The company has taken on board Mr. Manoj Gupta Chief Financial Officer (CFO) w.e.f.1st May 2018 i.e. within the period of six month from the date of resignation of theearlier CFO in compliance of the Section 203(4) of the Companies Act 2013 and hisappointment as CFO has been approved by the Board of Directors at their meeting held on6th May 2018.

Further M/s. dvmgopal & Associates Practising Company Secretaries carries outReconciliation of Share Capital Audit every quarter and the report thereon is submitted tothe Stock Exchanges.

Conservation of Energy Technology Absorption and Foreign Exchange Earnings & Outgo

The above information as required under the Companies Act 2013 is annexed as Annexure– E.

Employees Stock Option Scheme

The Schemes are in line with the SEBI (Share Based Employee Benefits) Regulations 2014("SBEB Regulations") and there have been no material changes to the schemesduring the financial year 2017-18. The Company has received a certificate from theAuditors of the Company that the Schemes are implemented in accordance with the SBEBRegulations and the resolutions passed by the members. The certificate would be availableat the Annual General Meeting for inspection by members. The details as required to bedisclosed under the SBEB Regulations and certificate from Auditors are put on theCompany's website and may be accessed at:

Conversion of Zero Coupon unsecured Foreign Currency Convertible Bonds (FCCB)

Your company had 22182 No's of outstanding Zero Coupon unsecured Foreign CurrencyConvertible Bonds (FCCB) at the start of the year which was due for conversion/redemptionin Nov 2016/Dec 2016. In the current Financial Year the company and the bondholders hasentered into a settlement agreement dated May 16 2017 which has been approved by the LokAdalat City Civil Court Legal Service Authority Hyderabad on June 3 2017.

Accordingly during the year under review all the outstanding 22182 No's of FCCB areredeemed/converted as follows:- a. 7528 No's of FCCB are redeemed as per the redemptionnotice received from the bondholders amounting to USD 9999750 in accordance with theterms of the FCCBs set out in the offer circular dated December 12 2011.

b. Allotment of 9999499 equity shares of H 2/- each upon conversion of 7373 No's ofFCCB as per the conversion notice received from the bondholders in accordance with theterms of the FCCBs set out in the offer circular dated December 12 2011.

c. Allotment of 9874726 equity shares of H 2/- each upon conversion of 7281 No's ofFCCB as per the conversion notice received from the bondholders in accordance with theterms of the FCCBs set out in the offer circular dated December 12 2011.

Further there are no FCCBs outstanding as on March 31 2018.

Change in Capital Structure and Listing at Stock Exchanges

The equity shares of your Company continue to be listed and traded on the BSE Ltd.(BSE) and National Stock Exchange of India Ltd. (NSE). During the financial year underreview 290516 equity shares were allotted on exercise of the options vested under theEmployee Stock Option Scheme and 19874225 equity shares were allotted upon conversionof 14654 No's of Foreign Currency Convertible Bonds (FCCBs) and admitted for trading onNSE and BSE. Consequently the Equity Share Capital of your Company increased from H176364108/- comprising of 88182054 equity shares of H 2/- each to H 216693590/-comprising of 108346795 equity shares of H 2/- each as on March 31 2018.

Board Policies

The details of the policies approved and adopted by the Board are provided in Annexure- F to this report.

Corporate Governance

Your Company is committed to maintain the high standards of corporate governance andadhere to the corporate governance requirements set out by Securities and Exchange Boardof India. The Report on corporate governance as stipulated under the Listing Regulationsforms part of the Annual Report and is annexed as Annexure - G. The requisitecertificate from the Practicing Company Secretary confirming compliance with theconditions of corporate governance as stipulated under the aforesaid Regulations formspart of this report.

Management Discussion and Analysis (MD&A)

MD & A Report for the financial year under review as stipulated under Regulation34 of the Listing Regulations is presented in a separate section and forms part of theAnnual Report.


Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the financial yearunder review:

1. Issue of equity shares with differential rights as to dividend voting or otherwise.

2. Issue of shares (including sweat equity shares) to employees of your Company underany scheme save and except ESOS referred to in this Report.

3. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.

4. During the period under review none of the Auditors of the Company have reportedany fraud as specified under the second proviso of Section 143 (12) of the Companies Act2013 (including any statutory modification(s) or re-enactment(s) thereof for the timebeing in force);

5. The Company has complied with Secretarial Standards i.e. SS-1 and SS-2 relating toMeetings of the Board of Directors and General Meetings issued by the Institute ofCompany Secretaries of India.

6. There were no material changes commitments affecting the financial position of yourCompany between the end of financial year (March 31 2018) and the date of the report (May29 2018).


Your Directors thank various departments of Central and State Government Organizationsand Agencies for the continued help and co-operation extended by them to your company.Your Directors also gratefully acknowledge all stakeholders of the Company viz. memberscustomers dealers vendors Financial Institutions banks and other business partners forthe excellent support received from them during the year. Your Directors place on recordtheir sincere appreciation to all employees of the Company for their unstinted commitmentand continued contribution to the Company.

For and on behalf of the Board
K L Chugh
Place: Hyderabad Chairman
Date: May 29 2018 DIN: 00140124