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Intellect Design Arena Ltd.

BSE: 538835 Sector: IT
NSE: INTELLECT ISIN Code: INE306R01017
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VOLUME 44464
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P/E 71.86
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OPEN 180.45
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VOLUME 44464
52-Week high 226.45
52-Week low 96.50
P/E 71.86
Mkt Cap.(Rs cr) 2,361
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Intellect Design Arena Ltd. (INTELLECT) - Director Report

Company director report

To the members

We are pleased to present the 6th Annual Report on our business and operations for theyear ended 31st March 2017 of Intellect Design Arena

Limited ("Company"). This is our third year of business operations.

1. Results of operations (In Rs. Lakhs except EPS data)

Standalone

Consolidated

Description

Year ended March 31

2017 2016 2017 2016
Income (Including Other 54843.56 56357.40 95549.38 83640.87
Income)
Expenses (Including exceptional items) 57145.46 52885.95 94616.32 84790.74
Profit/(Loss) before Interest (2301.90) 3471.45 933.06 (1149.87)
Depreciation & Tax (PBIDTA)
Finance Charges 1052.30 9.86 1130.24 119.22
Depreciation & amortization 2260.71 1904.52 2413.99 2064.98
Net Profit/(Loss) Before Tax (5614.91) 1557.07 (2611.17) (3334.07)
Provision for tax including - (1075.10) 283.63 (906.32)
Deferred Tax
Net Profit/(Loss) after tax (5614.91) 2632.17 (2894.80) (2427.75)
Add / (Less): Share of Profit / - - 656.22 82.76
(Loss) on Associate Companies
Net Profit / (Loss) (5614.91) 2632.17 (2238.58) (2344.99)
Re-measurement gains/(losses) on defined benefit plans (187.44) (81.48) (194.16) (75.47)
Exchange differences on translation of foreign operations - - (13.99.70) 1312.23
Net movement on cash flow hedges 1223.97 113.00 1223.97 113.00
Other comprehensive income for the year net of tax 1036.53 31.52 (369.89) 1349.76
Total comprehensive income for the year net of tax (4578.38) 2663.69 (2608.47) (995.23)
EPS
Basic Rs. (5.56) 2.61 (2.21) (2.33)
Diluted Rs. (5.56) 2.50 (2.21) (2.33)

Table No. 1.1

Function wise classification of statement of consolidated Profit and Loss

In Rs. lakhs

Year Ended
PARTICULARS
March 31 2017 March 31 2016
INCOME
Income from software product license and related services 91357.50 81065.55
EXPENDITURE
Software development expenses 46326.00 39500.01
Selling and marketing & General and administrative expenses 39102.94 33050.24
Research & Engineering expenses 7192.08 10629.77
Provision for Debts and Write Offs 1233.16 979.62
Total Expenditure 93854.18 84159.64
EBITDA (2496.68) (3094.09)
Depreciation / Amortisation 2413.99 2077.11
Finance Charges 1130.24 119.22
Profit / (Loss) before other income / minority interest (6040.91) (5290.42)
Other Income including exceptional items 3235.56 1869.71
Minority Interest / Share of profit / (loss )
656.24 93.93
of Associate Companies
Profit / (Loss) before tax (2149.11) (3326.78)
Year Ended
PARTICULARS March 31 March 31
2017 2016
Provision for taxation (283.63) 906.32
Profit / (Loss) after tax (2432.74) (2420.46)
Net movement on cash flow hedges &
Exchange differences on translation of foreign operations (175.73) 1425.23
Total comprehensive income for the year net of tax (2608.47) (995.23)

Table No. 1.2

2. Business Performance

The consolidated revenue of the Company for the year ended March 31st 2017 stood atRs.91357.50 lakhs as against Rs.81065.55 Lakhs for the previous year and delivered agrowth of 13%. The consolidated Net Profit/(Loss) for the fiscal year ended March 31st2017 stood at Rs.(2432.74) lakhs as against the previous year's Net Profit/(Loss) ofRs.(2420.46) Lakhs. The Consolidated Reserves and Surplus as of 31st March 2017 stood atRs.54747.69 Lakhs as against Rs.56092.84 Lakhs as of March 31st 2016.

3. Material Changes and Commitments

There were no material changes and commitments from the end of the financial year tillthe date of this report.

4. Subsidiaries

Details of Subsidiary Companies Joint Ventures and Associate Companies and theirfinancial position.

Your Company has 23 (12 direct 1 JV and 10 step down) subsidiary companies and 2Associate Companies for the financial year ended on March 31st 2017. The information asrequired under the first proviso to sub-section (3) of Section 129 is given in Form AOC-1in Annexure [1].

5. Cash & Cash Equivalents

Your Company's has cash reserve of Rs.8650.74 lakhs.

6. Share Capital

The paid up Capital of the Company was increased to Rs.50.87 Crs through shareallotments made against exercise of Options under the ASOP Schemes comprising of101733872 number of equity shares of Rs.5/- each as on March 31st 2017. Theinformation as required under Rule 12(9) of the Companies (Share Capital and Debentures)Rules 2014 and also the information required under the Guidance note of ICAI inrelation to ESOPs are set out in the

Annexure 2 to the Directors' Report.

The details of all the stock option plans including terms of reference and therequirement specified under Regulation 14 of the SEBI (Share-based Employee Benefits)Regulations 2014 is available on the Company's website athttps://www.intellectdesign.com/investor/corporate-governance.asp. The Register of Membersand Share Transfer books of the company will be closed with effect from 11th August 2017to 21st August 2017 (both days inclusive).

7. Corporate Governance

Your Company has been complying with the provisions of Corporate Governance asstipulated in SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015. Aseparate report on Corporate Governance along with Auditors' certificate on compliance ofthe Corporate Governance norms as stipulated under Regulation 27 of the ListingRegulations and Management Discussion & Analysis forming part of this report areprovided elsewhere in this Annual Report.

Disclosure as required under Section II (IV) Part II of Schedule V of Companies Act2013

Name of Director Managing Director or Executive Director
Particulars Anil Kumar Verma Executive Director Arun Jain Managing Director V.Balaraman Independent Director Aruna Krishnamurthy Rao - Independent Director Arun Shekhar Aran Independent Director
Salary 120.00 NIL NIL NIL NIL
1 Benefits and bonuses NIL NIL NIL NIL NIL
Stock Option 205000* NIL 25000* NIL NIL
Pension NIL NIL NIL NIL NIL
Fixed component NIL NIL NIL NIL NIL
2 Performance linked incentive and performance criteria Ser NIL NIL NIL NIL NIL
3vice Contract of the Director NIL NIL NIL NIL NIL
Notice Period of the Director NIL NIL NIL NIL NIL
Severance fees NIL NIL NIL NIL NIL
4 Details of stock option and NIL NIL NIL NIL NIL
Discount details if any
No of Stock options accrued NIL NIL NIL NIL NIL
No. of Stock options NIL NIL NIL NIL NIL
exercisable

Table No. 1.3

* No. of stock options.

8. Transfer to Investor Education and Protection Fund

As required under the provisions of Section 125 and other applicable provisions ofCompanies Act 2013 dividends that remain unpaid/unclaimed for a period of seven yearsare to be transferred to the account administered by the Central Government viz: InvestorEducation and Protection Fund ("IEPF"). Once the amounts that are due for refundare transferred to the IEPF no claim shall lie in respect of those amounts against theCompany. The Company had not declared any dividend so far hence the above provisions arenot applicable to our Company.

9. Conservation of energy technology absorption foreign exchange earnings and outgo

The particulars as prescribed under Section 134(3)(m) of the Act read with Rule 8 ofthe Companies (Accounts) Rules 2014 are set out in the Annexure 3 to this Report.

10. Particulars of employees

Information pursuant to the provisions of Rules 5(2) & 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are attached to thisReport in Annexure [4]. Rule 5(3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 exempts from inclusion the particulars of employeesposted and working outside India not being directors or their relatives drawing more thanRs. 1.02 Crore per financial year or Rs. 8.5 lakhs per month but requires suchparticulars shall be furnished to the Registrar of Companies. Hence the statementincluded in Annexure [4] does not contain the particulars of employees who are posted andworking outside India. Any Member interested in obtaining a copy of such details may writeto the Company in this regard.

11. Directors' responsibility statement as required under Section

134 (5) of the Companies Act 2013

Pursuant to the provisions of Section 134(3)(c) of the Companies Act 2013 theDirectors of your company confirm that: a) In the preparation of the Annual Accounts theapplicable accounting standards had been followed along with proper explanation relatingto material departures; b) The Directors have selected such accounting policies andapplied them consistently and made judgements and estimates that are reasonable andprudent so as to give a true` and fair view of the state of affairs of the company at theend of the financial year and of the loss of the company for that period; c) The Directorshave taken proper and sufficient care for the maintenance of adequate accounting recordsin accordance with the provisions of this Act for safeguarding the assets of the companyand for preventing and detecting fraud and other irregularities. d) The Directors haveprepared the Annual Accounts on a "going concern basis". e) The Board ofDirectors have laid down internal financial controls to be followed by the company andthat such internal financial controls are adequate and were operating effectively. f) TheBoard of Directors have devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

12. Board Meetings Board of Directors Key Managerial Personnel & Committees ofDirectors

(a) Board Meetings:

The Board of Directors of the Company met 8 times during the year 2016-17. The detailsof various Board Meetings are provided in the Corporate Governance Report. The gapintervening between two meetings of the board is as prescribed in the Companies Act 2013(hereinafter "the Act").

(b) Changes in Directors & Key Managerial Personnel

The following changes have happened during the Financial Year 2016-17

1) Dr. Ashok Jhunjhunwala resigned from the Board of the Company on February 03 2017.

2) Mr. Arun Shekhar Aran was appointed as Additional Director by the Board at itsmeeting held on 03rd May 2016 and subsequently was appointed as Independent Director bythe shareholders at the Annual General meeting held on 21st July2016 (c)Re-Appointment

As per Article 34(1) of the Articles of Association of the Company one third of theDirectors are liable to retire by rotation at the Annual General Meeting of the Company.Mr. Anil Kumar Verma Director is liable to retire by rotation and offers himself forre-appointment

(d) Independent Directors

Mr. V.Balaraman and Ms. Aruna Krishnamurthy Rao were appointed as independent directorsat the 3rd AGM held on 17th September 2014 and at the EGM held on 9th October 2014respectively for a period of three (3) years who will continue to be on the Board tillthe conclusion of 6th Annual General Meeting scheduled to be held on 21st August 2017. Mr.Arun Shekhar Aran was appointed as independent director at the 5th Annual General meetingheld on 21st July 2016 for a period of three (3) years till the conclusion of 8th AnnualGeneral meeting

The Company has received necessary declarations from each Independent Director of theCompany under Section 149(7) of the Act that they meet the criteria of independence aslaid down in Section 149(6) of the Act.

(e) Details of remuneration to Directors: The information relating to remunerationof directors as required under Section 197(12) of the Act is given in Annexure [5].

(f) Board Committees

The Company has the following Committees of the Board: 1. Audit Committee 2. Nominationand Remuneration & Compensation committee

3. Stakeholders' Relationship committee 4. Corporate Social Responsibility committee 5.Risk Management Committee

Sub-committees:

1. Share transfer Committee

The composition of each of the above Committees their respective role andresponsibility is as detailed in the Report of Corporate Governance.

The policy framed by the Remuneration and Compensation Committee under the provisionsof Section 178(4) of the Act is as below:

(g) Remuneration policy

The remuneration policy of the Company has been so structured in order to match themarket trends of the IT industry. The Board in consultation with the Nomination andRemuneration & Compensation Committee decides the remuneration policy for Directors.The Company has made adequate disclosures to the members on the remuneration paid toDirectors from time to time. Remuneration/ Commission payable to Directors is determinedby the contributions made by the respective Directors for the growth of the Company.

The Policy of the Company on Director's appointment and remuneration includingcriteria for determining qualifications positive attributes independence of a Directorand other matters as required under Section 178 sub-section 3 of the Companies Act 2013is available. There has been no change in the policy since the last fiscal year. We affirmthat the remuneration paid to the Directors is as per the terms laid out in the nominationand remuneration policy of the Company.

(h) Board Evaluation

As required under the provisions of Section 134(3)(p) and Regulation 27 of the ListingRegulations the Board has carried out an annual performance evaluation of its ownperformance and the manner in which such performance evaluation was carried out is asunder: The performance evaluation framework is in place and has been circulated to all thedirectors to seek their response on the evaluation of the entire Board and independentdirectors. The Nomination and Remuneration &

Compensation Committee has carried out evaluation of director's performance. Thecriteria of evaluation is exercise of responsibilities in a bona fide manner in theinterest of the Company striving to attend meetings of the Board of Directors/ Committeesof which he/she is a member/ general meetings participating constructively and activelyin the meetings of the Board /committees of the Board etc.

(i) Vigil Mechanism

The Company has established a whistle-blower policy and also established a mechanismfor directors and employees to report their concerns. The details of the same is explainedin the Corporate Governance Report.

(j) Related Party Transactions

All related party transactions that were entered into during the financial year were onan arm's length basis and were in the ordinary course of business. There are no othermaterially significant related party transactions made by the Company with PromotersDirectors Key Managerial Personnel or other designated persons which may have a potentialconflict with the interest of the Company at large. The details of the related partytransactions as required under Section 134(3)(h) r/w Rule 8 of the Companies (Accounts)Rules 2014 is attached as Annexure [6].

13. Auditors

Financial Auditors: S.R. Batliboi & Associates LLP Chennai CharteredAccountants who are the Financial Auditors of the Company hold office as financialauditors until the conclusion of the 8th Annual General Meeting of the meeting to be heldin the Calendar year 2019. Their appointment is subject to ratification by the members atthe 6th Annual general meeting. Secretarial Audit: Pursuant to the provisions of Section204 of the Companies Act 2013 and the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 Secretarial Audit has been carried out by Mr. S EshwarPractising Company Secretary and his report is annexed as Annexure [7].

14. Fixed Deposits

Our Company has not accepted any deposits during the financial year and as such noamount of principal or interest was outstanding as on March 31 2017.

15. Social Connect

Ullas Trust

A Social initiative started in 1997 with an aim to integrate associates with the largercommunity to enable them to enjoy the bliss of working with young minds in the countrycontinues to grow into a movement exemplifying the power of inclusive CSR. In its 20 yearjourney the Ullas movement has grown beyond our associate community to include committedpartners to the cause of igniting young minds. These partners include family and friendsof our associates associates from our clients Civil Society Organizations and youthfrom colleges in the districts of Tamil Nadu all united by the common purpose of shapingthe thinking of adolescent young students. Over the 2 decades Ullas has awarded meritscholarships to more than 52000 students across Chennai Delhi Hyderabad Mumbai andPune. While the merit scholarships recognize their academic excellence these

"young achievers" as they are called receive weekend enrichment programsaptly titled as SUMMIT delivered by our associate community through packaged modules of 5interventions of 3 hours each - 15 magical hours per year over the four year period of thechild's association with

Ullas. This academic year over 6200 children from Corporation Government andGovernment-Aided schools in five cities Chennai Delhi Hyderabad Mumbai and Puneattended these intervention programs that aid not just with life skills but also in designthinking. Under the rural re-connect program "Touch The Soil" over 2 lakh youngminds were ignited with the power of "CAN DO" and "Planning" with theactive engagement and support of over 1600 volunteers across 82 districts in 5 states.

Ullas Chennai

Ullas Trust celebrated its 19th Annual workshop on Sep 3rd 2016 at The Music AcademyAuditorium in Chennai. The workshop was all about Igniting Young Minds and celebrated over1230 grade IX Ullas Young

Achievers from 218 - Corporation Government and Government-Aided schools who not onlyparticipated in the aspirational "CAN DO" workshop but also were awarded theUllas Young Achievers Scholarships. The workshop saw real life role models Mr. SunilPaliwal IAS (MD-Aavin Cooperative Milk Federation Tamil Nadu) and Dr. Sankar(Pediatric Orthopedic Surgeon) share their life journey - events and incidents that shapedthem inspire and interact with the students. Continuing its endeavor of recognizing andEncouraging Excellence in Education (EEE) 3 schools one each from corporationgovernment and government aided were awarded the EEE award. Associate volunteersconducted the weekend enrichment program (SUMMIT) across 7 venues in the city (includingour corporate offices) covering over 3752 young achievers from grade 9-12. As part of theTouch The Soil program over 400 volunteers visited 403 schools in the 32 districts of TNigniting over 1.51 lakh grade 9-12 students conducting the Diary of Dreams and Planningworkshop. A total of 3579 scholarships were given to toppers in grade 9 and 10 in thedistrict schools. During this academic year Ullas inducted 68 Higher Education Scholars(26 professional stream and 42 arts and science students) while continuing to support anoverall of 198 Higher Education Scholars who come back as mentors to the incoming UllasYoung Achievers. These Higher Education Scholars not only inspire their juniors but alsodazzle the associate mentors with their commitment and thirst to give back! Ullascontinues to sponsor Easy Learning English (ELE) program of Vidyarambam Trust (VT) forgrade 6 to 8 students in over 25 schools in 5 districts of TN. Vidyarambam Akkas alsodeliver our SUMMIT interventions to over 2500 grade 9 and 10 students in these schoolsfurther extending the engagement with these young minds! In the spirit of partnering withlikeminded partners to reach as many young minds in schools Talent Quest for India (TQI)a student volunteer body movement has taken the SUMMIT Level 1 2 and 3 interventions toover 7200 students (grade 910 and 11) in 19 schools across 15 districts of TN throughtheir army of over 250 college student volunteers from 32 different colleges. The secondedition of Ullas Confluence was held in Feb 2017 to celebrate and recognize these youngTQI volunteers from various colleges across the districts who are giving back selflessly.Common purpose and intent unites these partners with Ullas in reaching not just thestudents from the urban schools but also rural schools enabling dreams and aspirations!

Ullas Mumbai

Mumbai Ullas chapter conducted the "CAN DO" workshop on 26th

November at Damodar Hall Parel celebrating over 530 young achievers from 23 schools(13 Municipal and 10 Govt-Aided schools). The interactive workshop encouraged the studentsto dream big and dream big with conviction. Associate volunteers including over 50volunteers from our client partner - Morgan Stanley conducted SUMMIT in the chapterschools during the weekends reaching out to a total of 1029 students between grade 9 and10. As part of the Touch The Soil program 98 volunteers visited 85 schools in 32 talukasof 10 districts covering 13404 grade 9 and 10 students with 650 scholarships for thetoppers in 9th and 10th and conducting the Diary of Dreams and Planning workshop for theyoung minds.

Ullas Hyderabad

In Hyderabad 280 students enthusiastically participated in the Annual

"CAN DO" Workshop on January 7th 2017 which was held at Sardar Patel

Auditorium in Kesava Memorial Institute of Science and Technology. The Young Achieversenthralled everyone with their rendering of Saraswathi Vandanam and cultural performances.The Diary of Dreams workshop was very interactive and enabled students to share theiraspirational dreams. SUMMIT classes also saw our associate volunteers conduct the weekendintervention program for 280 grade 9 students and 254 grade 10 students at 9 schoolchapters. As part of the Touch the Soil initiative over 80 associate volunteers theirfamily and friends went in teams to 167 schools from 56 talukas in 21 districtsconducting the "CAN DO" and Planning workshop for 22125 students along with1428 merit scholarships for deserving grade 9 and 10 students.

Ullas Delhi

Ullas NCR chapter conducted the Annual CAN DO workshop on 19th November 2016 at ISKCONAuditorium New Delhi. 262 grade 9 young achievers from 20 government and government-aidedschools were inducted into the portals of Ullas Trust. The workshop also saw over 40school teachers and 50 associate volunteers who cheered and supported the young achievers.The weekend enrichment program SUMMIT was conducted by our associate volunteers in schoolchapters and our corporate office for over 874 young achievers (grade 9 to 12) and wasreceived very well by the students and their school authorities. As part of the Touch TheSoil initiative over 40 volunteers travelled to 19 mandals in 12 districts of NCRreaching 9506 students of grade 9-12 from 32 schools inspiring and igniting young mindsdelivering the Diary of Dreams workshop and Planning workshop and also with a meritscholarship to 295 toppers in 9th and 10th.

Ullas Pune

Ullas Pune Chapter continued its engagement with 4 schools this year. The Annual Diaryof Dreams workshop was conducted on Nov 26th 2016 for incoming young achievers coveringover 200 eager students across three locations. A total of 81 scholarships were awarded inthe urban schools as part of the SUMMIT program. 25 volunteers along with family andfriends conducted the subsequent weekend enrichment programs in the schools over 8weekends covering over 860 grade 9 and 10 students. As part of the Touch The Soilinitiative 27 volunteers went to 21 talukas in 7 districts covering 53 district schoolsreaching 10072 students from grade 9 and 10 with the diary of dreams and planningworkshop. 470 scholarships were given to 5 toppers each from grade 9 and 10 in these 53schools. The Ullas movement continues to be strengthened not just by our associates butalso their family and friends and strong long minded partners driven by the commonpurpose of "igniting young minds" and seeding the "CAN DO" spirit.

16) Audit Committee Recommendation

During the year all the recommendations of the Audit Committee were accepted by theBoard. The Composition of the Audit Committee is as described in the Corporate GovernanceReport.

17) Extract of Annual Return

The details forming part of the extract of the Annual Return in Form MGT 9 is annexedherewith as Annexure [8].

18) Significant & Material Orders passed by the Regulators or Courts

During the Financial Year 2016-17 no order has been passed by any regulatoryauthorities or Courts.

19) Particulars of Loans Guarantees and Investments u/s 186*

Investments made during the year 2015-16:

Name of the Investee Currency Face Value Amount in FCY/INR Amount in Lacs
1. Intellect Payments Limited INR 5 25000000 250.00

Table No. 1.4

* The Company has not granted Loans and Guarantees under Section 186 of the CompaniesAct 2013

20) Risk Management Policy

Being a pioneer in the Intellectual property led Business in India the company iscontinuously focusing and committing itself to have a Risk Management system suited forthe Products business.

Towards this the Board has formed a Risk Management Committee with Directors theChief Financial Officer & the Chief Risk Officer as members of the committee. TheCommittee works to mitigate any inherent risks faced by the Business and to meet theincreasing demand of Customer's liability through different means within the overallframework listed below.

Risk Management Framework

Objective

The Organization is subject to certain risks that may affect our ability to operatemay disrupt our business model due to changes in competitive landscape changes inTechnology which may render our capabilities obsolete and thus hamper our ability toserve our customers and protect assets. These risks could adversely affect Customerprojects Employees Shareholders liability to Third Party and risks to Property amongothers. Controlling these risks through a formal process is necessary for the well beingof the Organization and its stakeholders.

The organization's Risk policy identifies these Risks on a continuous basis andproposes mitigation measures. Our risk policy aims to minimize adverse impact of theserisks on Company's growth Profit margins and

People engagement besides Regulatory Compliance. Risk Management has been made anintegral part of the Organization by encouraging Risk Awareness among employees.

Risk Management Framework

The Audit Committee of the Board of Directors oversees the Risk Management process doneby the Risk Committee under the overall direction of the Board of Directors. The RiskManagement Committee consists of the Board of Directors Chief Financial Officer & theChief Risk Officer.

Risk Management Process

Risk Management is a continuous and developing process which runs throughout theOrganization's strategy and the implementation of that strategy. The Risk Management helpsthe organization to proactively manage uncertainties in the internal and externalenvironment and to limit the negative impacts and benefit on the opportunities.

Some of the Major risks and risk mitigation measures can be grouped in the followingfour categories:

2. Operational 3. Financial 4. Legal &
1. Business Risk
Risk Risk Compliance Risk
Recruitment - difficulty in finding
Business Segment Foreign Geo Subsidiary Compliance
Concentration specialized skill Exchange Reporting
New Country Risk due to Large Order to Intellectual
Business Model Entry Risk Commercial Cash cycle and Liquidity Risk Property Protection Risk Internal Financial
Geography General Liability Control
Concentration Cyber & Crime Risk from actions of (IFC) implementation Contractual
Competition Directors and Officers Risk due to Fire Hazards and Accident Compliance

Table No. 1.5

1. Business Risk

1.1. Business Segment Concentration

The company is specialized in BFSI space and could face the risk of concentration in asingle space. However this risk is mitigated to a large extent because the company haspresence in all the 4 sub segments of BFSI namely Corporate Banking Retail BankingCapital Markets and Insurance. These 4 sub segments have different boom and bust cycle andtherefore protect the company. The Company‘s foray into the Payments space throughiPay will further reduce this risk as Payments business is a fairly stable business withless impact of cyclicity.

1.2 Business Model

Our Revenue model is based on Products Business with its License and AMC revenues.There is a possibility that increasing share of business starts to come from Cloud Modelrather than License & AMC Model. This may pose a risk to our Business Model.

The Company keeps a close eye on the changing business scenario. A certain portion ofour revenue is already derived from the Cloud model. Should Cloud model get precedenceover License model the company has the wherewithal to shift the business model.

1.3 Geographic Concentration

Intellect is present across different Geographies which we internally classify as WorldI World II World III countries. World I is Rich countries World II is Middle Incomecountries and World III is the Emerging world. The risk gets mitigated by being present inall the three worlds as the demand from these countries varies across segments andbalances the cyclic nature of business.

1.4 Competition

The company faces competition from large Multinational companies Local companies inthe geography in which we operate and Indian Product companies. While many of thesecompanies are established companies the start ups may also disrupt our business. With aview to stay ahead of the competition an analysis of these competitions in the 4sub-segments and the 3 Worlds is done on a continuous basis. Another lever to mitigatethis risk is the Investments made in R&D which helps us to remain ahead in theinnovation curve.

2. Operational Risk 2.1 Recruitment

The company operates in niche BFSI product space which requires people with specializedskill as against mass recruitment that was followed in Services business. The Companyminimizes the risk through in-depth in-house training & recruitment from top endEngineering colleges and B Schools. Background Checks (BGC) is mandated for all new hirersand is audited from time to time.

2.2 New Country Entry Risk

For any new business opportunity in a new country a Country risk assessment clearancefrom the CRO is a must. Country risk assessments during entry and subsequent mitigationmeasures help in developing a robust knowledge platform and also to understand the localconditions and business culture at the early stages of the business.

2.3 Commercial General Liability Cyber & Crime

The company has a Global leader in Risk & Insurance advisory for advising on therisk and insurance coverage.

Commercial General Liability Insurance - To safeguard against Third Party bodily injuryor property damage arising out of our business operations.

Cyber Liability Insurance - To safeguard against any loss arising out of a securitybreach and or privacy breach that would result in sensitive or unauthorized data orinformation being lost or compromised.

Crime Insurance - To safeguard against any direct financial loss of property money orsecurities arising out the fraudulent activities committed by the employee or in collusionwith others.

2.4 Risks from actions of Directors and Officers

Directors & Officers Liability Insurance - To safeguard against any loss arisingout of a wrongful act made by the Directors Officers and

Employees of the organization with reference to the company's business operations andactivities.

2.5 Risks due to Fire Hazards & Accidents

Standard Fire and Special Perils Insurance - To protect the company's Assets (movable& immovable Assets) from the risk of Fire or Perils. 3. Financial Risk 3.1 ForeignExchange

The company earns a large portion of its revenue in foreign currencies and is exposedto the risk of currency movements. To mitigate this risk the company follows a 2 stepstrategy.

As the first step quotation in foreign currencies is restricted to few selected majorcurrencies. Quotation in any other currency is highly controlled.

The second leg of this strategy is to hedge the foreign earnings after subtracting thelocal expenses.

3.2 Larger Order to Cash cycle and Liquidity Risk

Our customer being large Banks and Financial Institutions the credit worthiness is incomfort even though the cycle is long. The percentage of bad debts is also minimal. Sincethe Products business has a long order to cash cycle the company has identified LiquidityRisk as an area to monitor. The Finance organization headed by the CFO monitors theliquidity position consisting of cash and near cash instruments on a continuous basis.

4. Legal & Compliance Risks

4.1 Subsidiary Compliance Reporting

A well structured framework has been instituted in Unmail the Company's

Enterprise Social Network for Subsidiary Compliance Reporting. The respectiveOperations Directors ensure uploading of the Compliance reports (suitably customized foreach Subsidiary) on a quarterly basis. This process enhances the control and improvesstatutory compliance in each jurisdiction.

4.2 Intellectual Property Protection Risk

Difficulties in protecting out IP in some countries that are pivotal for generatingrevenues are mitigated by registration of the IP in countries that have safe IP protectionlaws.

4.3 Internal Financial Control (IFC)

The company has to comply with additional controls enforced by Section 134 of theCompanies Act 2013. This is to report on the Internal Financial Control in the DirectorsReport and also by the Statutory Auditors. To comply with this the company appointed areputed Chartered Accountant firm to assess the existing control environment and ensurethat the requirements are complied.

4.4 Contractual Compliance

Product development companies are exposed to legal risk arising from Infringement of IPright and Non performance of contractual obligation. The company has established a strongprocess to review and appraise all contracts. As a policy it restricts its obligationunder each contract. The company has adequate Insurance to mitigate against risk of Errorsand Omissions Commercial General Liability.

21) Corporate Social Responsibility

Company has formed Corporate Social Responsibility Committee on October 15th 2014 andfollowing are the members to the Committee :- a) Mr. Anil Kumar Verma Chairman of theCommittee b) Ms. Aruna Rao Member of the Committee c) Mr. Arun Jain Member of theCommittee d) Mr. V. Balaraman Member of the Committee The Company is not required tocontribute towards Corporate Social Responsibility (CSR) as the average profits of theprevious three financial years is negative. However the Company as a responsible corporatecitizen has emerged itself to make contributions in the area of education to Ullas Trust.The Company for making contributions to Ullas Trust had sought the approval of theshareholders in its previous AGM held on 21st July 2016 and the same was approved by theshareholders.

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

The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013. The Internal Complaints

Committee ("ICC") has been set up to redress the complaints receivedregarding sexual harassment. All employees are covered under this policy. The following isthe summary of the complaints received and disposed off during the financial year 2016-17:a) No. of complaints received: NIL b) No. of complaints disposed NIL

23) Listing Fees

The Company confirms that it has paid the annual listing fees for the year 2017-18 toboth National Stock Exchange of India Limited and Bombay Stock Exchange Limited.

24) Acknowledgment

Your Directors take this opportunity to express the gratitude to all investorsclients vendors bankers Regulatory and Government authorities Stock Exchanges andbusiness associates for their cooperation encouragement and continued support extended tothe Company. Your Directors also wish to place on record their appreciation to theAssociates for their continuing support and unstinting efforts in ensuring an excellentall round operational performance at all levels.

By Order of the Board

For Intellect Design Arena Limited

Arun Jain

Chairman and Managing Director

Place: Chennai

Date : July 06 2017

Annexure 1 Form AOC - 1

Statement (Pursuant to first proviso to Sub-Section (3) of Section 129 read with rule 5of Companies (Accounts) Rules 2014) Statement containing salient features of thefinancial statement of Subsidiaries as on 31st Mar 2017

PART ''A'' : Subsidiaries

In Rs Lakhs
Provision Profit after Proposed
Name of the Subsidiary Reporting Period Reporting Currency Exchange Rate Capital Reserves Total Assets Total Liabilities Investment other than Investment in Turnover Profit before Tax for Tax Tax Dividend % of Holding
Subsidiary
1 Intellect Design Arena Pte Ltd. Singapore (+) April-March SGD 46.41 1698.60 1823.96 6588.74 3066.18 - 4757.34 (610.21) 20.95 (631.16) Nil 100%
Intellect Design Arena Limited. United April-March GBP 80.90 617.50 7720.10 16058.13 7720.52 - 29349.83 5230.28 234.43 4995.85 Nil 100%
2
Kingdom (+)
3 Intellect Design Arena SASwitzerland (+) April-March CHF 64.83 112.76 3524.12 4213.40 576.53 - 1157.72 350.48 58.81 291.67 Nil 100%
4 Intellect Design Arena Co. LtdVietnam (+) April-March VND 0.00 22.50 (348.16) 92.91 418.57 - 128.02 (206.79) - (206.79) Nil 100%
5 Intellect Design Arena FZ LLCDubai (+) April-March AED 17.66 203.70 4670.87 9095.24 4220.67 - 12549.96 (348.00) - (348.00) Nil 100%
Intellect Commerce LtdIndia (Formerly April-March INR 1.00 900.00 (504.92) 1100.11 705.03 - 676.36 100.00 39.45 60.55 Nil 100%
6
Known as Polaris Enterprise Solutions Ltd) (+)
7 Laser Soft Infosystems LimitedIndia (+) April-March INR 1.00 783.13 1859.21 4664.10 2021.76 0.45 2190.75 127.87 - 127.87 Nil 100%
8 SFL Properties Private LtdIndia (+) April-March INR 1.00 156.00 489.91 646.38 0.47 - - (4.85) - (4.85) Nil 100%
9 Indigo TX Software Pvt LtdIndia (+) April-March INR 1.00 39.70 95.57 345.65 210.38 - 170.37 (122.50) - (122.50) Nil 100%
10 Intellect Payments Limited India (+) April-March INR 1.00 255.00 - 582.10 327.10 - - - - - Nil 100%
11 Intellect India Limited India (+) April-March INR 1.00 5.00 - 6.55 1.55 - - - - - Nil 100%
12 Sonali Polaris FT LtdBangladesh (+) April-March BDT 0.82 468.15 (1182.48) 1115.50 1829.83 - 2202.93 1027.45 - 1027.45 Nil 51%
January - CLP 0.10 5.02 (180.32) 1070.62 1245.92 - 1220.04 (321.64) - (321.64) Nil 100%
13 Intellect Design Arena Ltda. Chile* December
14 Intellect Design Arena Inc. Canada* April-March CAD 48.59 572.79 (1538.21) 2466.04 3431.46 - 3423.10 (928.72) - (928.72) Nil 100%
15 Intellect Design ArenaPT Indonesia** April-March IDR 0.00 145.10 (348.92) 41.40 245.22 - - (126.48) (9.05) (117.43) Nil 100%
16 FT Grid Pte Ltd Singapore** April-March SGD 46.41 0.04 (1.35) 0.05 1.36 - - - - - Nil 100%
17 Intellect Design Arena Inc.US** April-March USD 64.85 3542.71 (7510.32) 10924.45 14892.06 - 8439.42 (712.60) 5.34 (717.94) Nil 100%
January - PHP 1.29 276.07 (504.90) 2618.62 2847.45 - 1778.55 (110.82) (76.00) (34.82) Nil 100%
18 Intellect Design Arena Phillipines INC **
December
19 Intellect Design ArenaSDN BHD Malaysia** April-March MYR 14.65 77.11 (10.47) 949.94 883.30 - 1005.75 54.34 9.70 44.64 Nil 100%
20 Intellect Design Arena Pte Ltd Australia** April-March AUD 49.58 50.98 (281.58) 147.68 378.27 - 184.75 (141.29) - (141.29) Nil 100%
January - THB 1.88 149.73 (565.98) 25.12 441.37 - 15.06 (252.94) - (252.94) Nil 100%
21 Intellect Design Arena Ltd Thailand** December
April-March INR 1.00 349.90 1720.86 3717.13 1646.37 - 2037.71 11.02 5.00 6.02 Nil 100%
22 SEEC Asia Technologies Private
LimitedIndia***

Table No. 1.6

Notes:

1Indian rupee equivalents of the figures given in foreign currencies in the accounts ofthe subsidiary companies are based on the exchange rates as on 31st Mar 2017 2.*Subsidiaries of Intellect Design Arena Limited UK 3.** Subsidiaries of Intellect DesignArena Pte Ltd Singapore 4.*** Subsidiaries of Intellect Design Arena Inc USA5.Investment includes investments made in step down subsidiaries 6.Information providedabove is based on the IND AS of the Subsidiaries for the financial year ended 31st Mar2017 7.{+) Direct Subsidiaries of Intellect Design Arena ltd 8.Names of subsidiaries whichhave been liquidated or sold during the year - NIL

Part "B": Associates and Joint Ventures

Statement pursuant to Section 129 (3) of the Companies Act 2013 related to AssociateCompanies and Joint Ventures

In Rs. lakhs
Name of Associates / Joint Ventures Adrenalin eSystems Limited NMSWorks Software Private Limited Intellect Polaris Design LLC
1. Latest audited Balance Sheet Date March 31st2017 March 31st2017 March 31st 2017
2. Shares of Associates / Joint Ventures held by the company on the year end
Number of shares 14285502 726256 45
Amount of Investment in Associates/Joint Venture 1877.32 624.14 1380.15
Extent of Holding % 39.93% 36.54% 45%
3. Description of how there is significant influence The Company has the control in excess of 20% of total share capital of Adrenalin eSystems Limited as per Section 2(6) of the Companies Act 2013 and comes under the definition of Associate Company The Company has the control in excess of 20% of total share capital of NMSWorks Software Private Limited as per Section 2(6) of the Companies Act 2013 and comes under the definition of Associate Company The Company has the control in excess of 20% of total share capital of Intellect Polaris Design LLC as per Section 2(6) of the Companies Act 2013 and comes under the definition of Associate Company
Reason why the associate / joint venture is not Holds less than 51% of Share Holds less than 51% of Share Holds less than 51% of Share
4.
consolidated Capital Hence no Control. Capital Hence no Control. Capital Hence no Control *
5Networth attributable to Shareholding as per latest . audited Balance Sheet 2793.79 3440.01 2884.31
6. Profit/ Loss for the year
i. Considered in Consolidation 372.08 347.31 (63.17)
ii. Not Considered in Consolidation 559.74 603.17 (63.17)

Table No. 1.7

* In case of Intellect Polaris Design LLC your Company is doing ProportionateConsolidation 1. Names of associates or joint ventures which are yet to commenceoperations - Nil 2. Names of associates or joint ventures which have been liquidated orsold during the year - Nil

For and on behalf of the Board of Directors of
Intellect Design Arena Limited
Arun Jain Arun Shekhar Aran S.Swaminathan V.V.Naresh
Chairman & Managing Director Director Chief Financial Officer Vice President &
Company Secretary

ANNEXURE 2

Employee Stock Option Plans

Your Company currently administers [4] stock option programs viz. ASOP 2003 ASOP2004 ASOP 2011 which were inherited from the Demerged Company and ISOP 2015 which wasapproved by the members in the meeting held on 29th January 2015 and ISOP 2016 which wasapproved by the members in the meeting held on 21st July 2016. Summary information ofthese various stock option programs of the Company is provided under Notes to Accountsunder Standalone Financial Statements of this Annual Report. All the ESOP schemes areavailable on the website of the Company. Web link for the same ishttp://www.intellectdesign.com/investor/corporate-governance.asp The Company has recordedcompensation cost for all grants using the intrinsic value- based method of accounting inline with prescribed SEBI guidelines. Had compensation been determined under the fairvalue approach described in the Guidance Note on "Accounting for employee sharebased payments" issued by ICAI the Company's net profit and basic and dilutedearnings per share would have reduced to the proforma amounts as indicated:

Information as required under Rule 12(9) (j) (i) to (iii) of the Companies (ShareCapital and Debentures) Rules 2014 is as below: Key Managerial Personnel

Name of the Key ESOPs
Designation
Managerial Personnel Granted
Arun Jain Chairman and Managing Director NIL
Anil Kumar Verma Executive Director 25000
S. Swaminathan Chief Financial Officer 25000
Company Secretary and
V V Naresh
Compliance Officer NIL
Total 50000

Table No. 1.8

Employees who were granted options amounting to 5% or more of options granted duringthe financial year 2016-17:- NIL Employees who were granted options amounting to 1% ormore of issued capital of the Company at the time of grant of options during the financialyear 2016-17 - NIL

ANNEXURE 3

Details of Conservation of Energy Technology Absorption Foreign Exchange Earnings andOutflow

[Clause (m) of sub-section (3) of Section 134 of the Act r/w Rule 8 of the Companies(Accounts) Rules 2014]

Conservation of energy:

? The steps taken / impact on conservation of energy:

- We are continuing to optimize usage of chiller / split / package AC set point tomaintain condition space temperature @ 26 degree centigrade

- We switch off the lights through Manual Control Board thus conserving energy.

- Have initiated Implementation of replacement of LED lights Floor Wise initialprogress made to reduce lighting power consumption

- Auto shutting down of systems to reduce UPS power consumption

- Installation of Solar street lights in Next level campus ? Savings achieved

- In FY 2016 -17 power supply has stabilized in Tamil Nadu reducing the dependency onDiesel which resulted in savings. ? Steps taken by the company for utilizing alternatesources of energy;

- We started purchasing Wind power trading @ Next Level location in FY 2016-17 ?Capital investment on energy conservation equipment;

- Purchase of LED lighting to reduce power consumption @ NxT LvL

- Purchase of VFDs to reduce power consumption in HVAC system

Have obtained ISO certification (ISO 14001:2015) for Environment Management System -October 2016

During FY 2016-17 we have added one more floor at NxT LvL (Second floor operationstarted on 24th Aug 2016 with 583 seats). Based on the increase in occupancy in NxT LvLwe have added 500 Kv by raising additional demand with the EB. We have purchased groupcaptive power from OGPL that brought in savings of Rs.15.00 lakhs approx. With thecontinuous flow of the units we strengthened our relationship with OGPL and propose torenegotiate the unit price for 2017-18 that would bring in additional savings of 3-4lakhs. Current TNEB unit price is Rs.6.35.

IT Infrastructure

Major Upgrades:

Intellect IT Infrastructure is redesigned with two Cloud service providers for test& development to handle BCP / DR. We had also built new DC at NxT LvL Chennai with12 rack capacity to take care of legacy systems and RISC based servers. Data Center DR isbuilt at Goregaon Mumbai with critical services hosted during BCP / DR.

Cloud servers are accessible through MPLS network with 2 last miles. Hence associateshave same experience in accessing cloud as like data center.

Complex network architecture was designed and implemented as Intellect has open networkpockets and secured network pockets to take care of product development which are testedfor possible scenarios.

PBX at Goregaon is replaced as it was EoS and migrated to new one very smoothly.

IT Operations:

Global Monitoring Center at Intellect monitors IT Infrastructure on 24*7 basis able todeliver >99.95% uptime month on-month.

Assets are optimally managed thus saving INR 49L on reuse of repaired assets.

Cloud services are built to take care of BCP/DR requirements which again helped us inachieving cost save of INR 42L per annum

Voice services including telephone calls and voice conference are built with 3 tierredundancy also reducing the voice costs by 20-30%.

New IT infrastructure

The following new IT infrastructure implementations were completed during the pastyear:

Varanasi (40 Seats)

Pune (60 Seats)

NxT LvL - Second Floor (550 Seats)

MIS

After the demerger PeopleSoft the core financial system had to be replaced forIntellect. Top Management decided to use our own QCBS product "EGL" to replacePeopleSoft. EGL was successfully implemented in short time by team Intellect. This waspossible only because of excellent collaboration amongst the various user teams likeFinance HR Admin QCBS and MIS IT team. The cost save on software management &support.

A new data interface was developed to share required Master and Transactional Data tothe QCBS system on regular basis for invoicing and collections.

Intellect adopted the new tool JIRA to record the activities and tasks which can beused to provide evidences during System Audit.

UnMail

This is the social platform used in Intellect. This helps more collaboration andimproves productivity. Following features are enhanced during FY2016-17

1) More Social:

a) The omni-present "Like" - Ability to like Conversations / Circle Topicsand their replies. (Earlier this facility was available only to Broadcasts and IntellectConnect)

b) Follow global posts in your My Notifications. Now we can follow Intellect Connectposts and Circle topics in My Notifications. By default we "follow" all roomactivities.

c) Mention a user in room broadcasts / conversations to get his / her attention. Thispost is highlighted for the mentioned user in My Notifications even if the user is notfollowing the room updates.

2) Advanced Notification Management:

a) Filter Notifications (by app type unread only highlighted updates only)

b) Inline replies / actions to notifications

c) UnFollow a room broadcast / conversation or the global post being followed to stoprecurring notifications on that post

d) Quick visual scan of My Notifications with the photo of the personFT

3) Better Attachment & Image Handling:

a) Now attachments are supported in Broadcasts / Intellect Connect as well. (Earlierthis facility was available only to Conversations / Knowledge Circles)

b) Attachment is treated as a gold copy document with version control. The attachmentgets added to your Room Documents and linked to the post. One would no longer need toattach the same file at multiple places in the thread

c) All the attachments of a thread are listed at the top as a single list with thefacility to update the version or download in addition to support for inline attachmentswithin content.

d) Attachment can now be from the user machine or just a link to existing room document/ private wall document

e) Image can be inserted into a post using drag and drop from your machine folder

4) Enrichments to Apps:

a) Action Items can now be tracked as a Social Flow with notifications and reminders

b) Reviews Customer Commitment Risk can now be tracked as a Social Flow withnotifications

c) Comments to Broadcasts and Intellect Connect now support their own nested one leveldiscussion

d) Folders in Documents and Conversations are now ordered in ascending order of theirname e) Conversations Listing also supports preview now. In addition to the defaultthread-like view post view of a conversation also supports date-wise linear view

f) Displaying User Name instead of user id in posts and notifications.

5) My Messages:

a) Now they are not notified separately on top right band. Its notifications appear inMy Notifications along with notifications of private conversations.

b) Can now be treated as private conversation allow addition of more participants fordiscussion around it

6) The mobile apps

Many of the above features are supported on mobile as well. In addition Mobile appsupports Appreciation credits functionality and Room Member listing with addition /removal of members. Aspects related to Follow / UnFollow and inline replies are availablefor Android users and would be supported in iOS subsequently.

7) Multi-lingual capability

8) Travel Management

Effective Travel Management is the inherent service part of any organization. UnMailbrings the social touch to travel management by capturing all the travel details andflowing the information across right people. By doing this the complete travel processbecomes very lean and transparent.

9) Visitor Management with mobile push notification when visitor is at the site.

10) Milestone POC. Better tracking of milestones. 11) Poll . Organization wide poll.12) Pick of the Day

FT Grid Operations

Background: Being a SAAS delivery model Intellect has to closely work with theapplication team and service partners such as Telecom to ensure end-to-end serviceavailability. Intellect's IT department has six core banking customers four FABXcustomers and one Lending (A PSU home finance company) on FT Grid.

(C) Foreign exchange earnings and Outgo :

Rs. In lakhs
Particulars 2016-17 2015-16
Foreign exchange earnings 34918.12 38773.93
Table No. 1.9
Rs. In lakhs
Particulars 2016-17 2015-16
Foreign exchange outgo 9814.95 5965.97
Table No. 1.10

ANNEXURE 4

Particulars of Employees

Information as required under Rule 5(3) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 and forming part of the

Director's Report for the Financial Year ended March 31 2017

Top 10 employees of the Company employed throughout the year

Employee Name Designation Nature of employment Qualification Age (Years) Previous Employer Total Experience Designation at Previous Date of Joining Amount in Lakhs INR
(in years)
1 Paul Hansford Executive Vice President Service B.E 58 Smartstream Technologies Limited 37 Employment Global Head of Professional 01/12/2014 260.79
2 Swaminathan S Executive Vice President & CFO Service B.Com CA 60 TVS Electronics Limited Over 30 years Services President Strategic 08/02/2007 171.89
3 K. Srinivasan Head Growth Markets IMEA and APAC Service B.Sc PGDM 50 Suntech Business Solutions 27 Accounts & CFO Global Sales Head Senior Vice- 18/03/2008 150.42
4 Govind Singhal President & CEO Service M.Sc (Phy.) B.Sc. (Phy.) 56 Satyam Computers 31 President & 15/12/2008 146.91
5 Rajesh Saxena Executive Vice President Executive Vice Service B.E. PGDM 53 American Express Banking Corporation Orbitech Solutions 31 Integrator Executive Vice President Assistant Vice 31/08/2011 150.10
6 Govind Saxena Ramkumar President Executive Vice Service Service B.Tech M.Tech M.Tech 48 47 Limited J.P. Morgan Services 22 President 1/2/1995 142.16
7 Pechiappan Venkatesh Iyengar President Executive Vice India Pvt Limited 22 Executive Director 14/04/2015 111.66
8 Service B.Com CA ICA 56 Citibank N.A. 32 Vice President 17/11/1997 109.68
Srinivasan President
9 Paramdeep Singh Executive Vice President Service B.E. (EEE) MBA 50 Mind Shaper Technologies Pvt. Ltd. 28 President Private School Business 01/04/2014 100.45
10 Kedarnath President & Business Head Harishankar Udiyavar One Markets Contractual Master of Management Studies Bachelor of Engineering 58 Polaris Consulting & Services Limited 34 President & Chief Solutions Officer 01/04/2016 90.76

Table No. 1.11

Note:- (i) The above ranking of top 10 employees has been done based on their grosssalary

(ii) None of the employees mentioned above are relatives of any Director or Managers ofthe Company

(iii) Above remuneration includes amount paid during the year plus perquisite value ofStock Option and Retirement benefit

Information as required under Rule 5(3) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 and forming part of the Director's Report for theFinancial Year ended March 31 2017

Employee Name Designation Nature of employment Qualification Age (Years) Previous Employer Total Experience (in years) Designation at Previous Employment Date of Joining Amount in Lakhs INR
Executive Vice
1 Govind Saxena Venkatesh Iyengar President Executive Vice Service B.Tech M.Tech 48 Orbitech Solutions Limited 22 Assistant Vice President 1/2/1995 142.16
2 Srinivasan Padmini President Service B.Com CA ICA 56 Citibank N.A. American Express 32 Vice President 17/11/1997 109.68
3 Sharathkumar Executive Vice President Service B.E. M.M. S 48 Technologies-Chennai TVS Electronics 24 Team Leader 18/06/2002 149.11
4 Swaminathan S Executive Vice President & CFO Service B.Com CA M.Sc (Phy.) 60 Limited Over 30 President Strategic Accounts & CFO Senior Vice- 08/02/2007 171.89
5 Govind Singhal President & CEO Service B.Sc. (Phy.) 56 Satyam Computers 31 President & 15/12/2008 146.91
6 Rajesh Saxena Executive Vice President Service B.E. PGDM 53 American Express Banking Corporation 31 Integrator Executive Vice President 31/08/2011 150.10
7 Paul Hansford Executive Vice President Service B.E 58 Smartstream Technologies Limited 37 Global Head of Professional Services 01/12/2014 260.79

Table No. 1.12

Note:- (i) None of the employees mentioned above are relatives of any Director orManagers of the Company

(ii) Above remuneration includes amount paid during the year plus perquisite value ofStock Option and Retirement benefit

Information as required under Rule 5(3) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 and forming part of the Director's Report for theFinancial Year ended March 31 2017 (For the Part of the Year)

Employee Name Designation Nature of employment Qualification Age (Years ) Previous Employer Total Experience (in years) Designation at Previous Employment Date of Joining Amount in Lakhs INR
Guido Leon 1 Vogelzanj Senior Vice President Service Degree in Electrical Engineering & Degree in Economics 47 Symphony 20 Vice President - CRM Technology 18/08/2016 87.52

Table No. 1.13

Note:- (i) None of the employees mentioned above are relatives of any Director orManagers of the Company

(ii) Above remuneration includes amount paid during the year plus perquisite value ofStock Option and Retirement benefit

Information as required under Rule 5(3) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 and forming part of the Director's Report for theFinancial Year ended March 31 2017 - (Resigned)

Employee Name Designation Nature of employment Qualification Age (Years) Previous Employer Total Experience (in years) Designation at Previous Employment Date of Joining Amount in Lakhs INR
1 Vinod Chelambathodi Executive Vice President Service B.Com PGDPM 51 Capgemini India Private Limited 27 Vice President 04/01/2012 75.26
2 Shashi Mohan Chief Technology Officer Service B.E. 54 HA Systems / Oracle 34 Principal 02/06/2008 54.90

Table No. 1.14

ANNEXURE 5

Details of ratio of remuneration to Directors & KMP

[Section 197(12) r/w Rule 5 of Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014]

(i) the ratio of the remuneration of each director to the median remuneration of the employees of the company for the financial year; Name of the Director Ratio to the Median
Anil Kumar Verma Executive Director 14.28
(ii) the percentage increase in remuneration of each director Chief
Name of the Director % increase
Financial Officer Chief Executive Officer Company Secretary or Manager if any in the financial year;
Mr. Arun Jain Managing Director NIL
Mr. Anil Kumar Verma NIL
Mr. S. Swaminathan Chief Financial Officer 7%
Mr. V V Naresh Company Secretary and 7%
Compliance Officer
(iii) the percentage increase in the median remuneration of employees in the financial year; 9.88%
(iv) the number of permanent employees on the rolls of company; 3834 (including 2 whole time directors)
(v) average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration;
Average Increase 6.80%
Key Managerial Personnel :
Company Secretary 7%
Chief Financial Officer 7%
(vi) Affirmation that the remuneration is as per the remuneration policy of the company. Yes the remuneration is as per the Remuneration Policy of the Company.

ANNEXURE 6

Details of Related Party Transactions

(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) ofthe Companies (Accounts) Rules 2014)

1. Details of contracts or arrangements or transactions not at arm's length basis

(a) Name(s) of the related party and nature of relationship - -
(b) Nature of contracts/arrangements/transactions - -
(c) Duration of the contracts/arrangements/transactions - -
(d) Salient terms of the contracts or arrangements or transactions including the value if any - -
(e) Justification for entering into such contracts or arrangements or transactions - -
(f) Date(s) of approval by the Board - -
(g) Amount paid as advances if any: - -
Date on which the special resolution was passed in general meeting as required under first
(h) - -
proviso to section 188

Table No. 1.16

2. Details of material contracts or arrangement or transactions at arm's length basis

in Rs.Lakhs
NAME OF THE RELATED PARTY AND NATURE OF Indigo TX Software Private
Adrenalin e-Systems Limited Laser Soft Infosystems Limited
RELATIONSHIP Limited
Nature of contracts/arrangements/transactions a. Reimbursement of expenses to the Company a. Software Development Expenses a. Software Development Expenses
b. Interest Income from Investment in debt instruments of associates b. Reimbursement of Expenses to the Company b. Reimbursement of Expenses to the Company
c. Reimbursement of Expenses by the Company
c. Reimbursement of expenses by the Company c. Reimbursement of expenses by the d. Loans and advances
e. Maximum amount outstanding during the year
d. Short term loans and advances Company
e. Maximum amount outstanding during the year d. Trade Receivables f. Investments
e. Loans and Advances
f. Investment in Debt Instrument carried at amortized cost f. Maximum amount
outstanding during the
g. Investment year
g. Investments
The Contract will continue till any The Contract will continue till The Contract will continue till any party
Duration of the
party terminate the contract any party terminate the terminate the contract
contracts/arrangements/transactions
contract
Salient terms of the contracts or arrangements or The transactions entered into are in The transactions entered into The transactions entered into are in the
transactions including the value if any the usual course of business and at are in the usual course of usual course of business and at arm's length
arm's length basis. The board took business and at arm's length basis. The board took note of the same in
note of the same in the meeting of the basis. The board took note of the meeting of the directors held on
directors held on 03.05.2017 the same in the meeting of the 03.05.2017
directors held on 03.05.2017
Justification for entering into such contracts or arrangements or transactions a) To avoid misuse of corporate assets and abuse of related party transactions a) To avoid misuse of corporate assets and abuse of related party transactions a) To avoid misuse of corporate assets and abuse of related party transactions b) To ensure compliance with the relevant legal framework set out by regulatory authorities
b) To ensure compliance with the relevant legal framework set out by regulatory authorities b) To ensure compliance with the relevant legal framework set out by regulatory authorities c) To act as a framework for any statement of work that may be entered into between the parties for any service that may be provided by one party to another
c) To act as a framework for any statement of work that may be entered into between the parties for any service that may be provided by one party to another
c) To act as a framework for any statement of work that may be entered into between the parties for any service that may be provided by one party to another
Date of approval by the Board 03.05.2017 03.05.2017 03.05.2017
Amount paid as advances if any a. Reimbursement of expenses to the Company- 15.62 a. Software Development Expenses- 120.53 a. Software Development Expenses- 1140.00
b. Interest Income from Investment in debt instruments 46.20 b. Reimbursement of Expenses to the Company- 51.08 b. Reimbursement of Expenses to the Company- 2075.57
c. Reimbursement of expenses by the Company- 400.69 c. Reimbursement of expenses by the Company- 27.32 c. Reimbursement of Expenses by the Company- 1375.06
d. Short term loans and advances- 846.93 d. Trade Receivables- 1.58 d. Loans and advances- 895.27
e. Maximum amount outstanding during the year 846.93 e. Loans and Advances- 102.65 e. Maximum amount outstanding during the year 1876.25
f. Investment in Debt Instrument carried at amortized cost- 431.24 f. Maximum amount outstanding during the year 103.38 f. Investments-5201.05
g. Investment 1877.33 g. Investments-1702.97