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Mindteck (India) Ltd.

BSE: 517344 Sector: IT
NSE: MINDTECK ISIN Code: INE110B01017
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VOLUME 1553
52-Week high 54.40
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P/E 20.28
Mkt Cap.(Rs cr) 66
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Sell Qty 200.00
OPEN 25.00
CLOSE 25.60
VOLUME 1553
52-Week high 54.40
52-Week low 22.05
P/E 20.28
Mkt Cap.(Rs cr) 66
Buy Price 25.60
Buy Qty 3.00
Sell Price 27.75
Sell Qty 200.00

Mindteck (India) Ltd. (MINDTECK) - Director Report

Company director report

To the Members

The Directors hereby present the Twenty-Eighth Annual Report of yourCompany along with the Audited Financial Statements for the Financial Year ended March 312019. The Consolidated performance of the Company and its Subsidiaries has been referredto wherever required.

1. FINANCIAL RESULTS

(in Rs. Million)
Standalone Consolidated
Particulars Year ended March 31 2019 Year ended March 31 2018 Year ended March 31 2019 Year ended March 31 2018
Revenue from operations 1076.30 884.20 2994.10 2968.40
Other income 24.50 19.00 28.50 20.80
Employee benefits expense 656.30 616.50 2028.10 2043.80
Cost of technical sub-contractors 26.70 11.40 479.30 536.90
Other expenses 291.30 218.80 442.70 375.00
Profit before finance cost depreciation taxes amortization 126.50 56.50 72.50 33.50
Finance cost 6.40 2.20 10.00 5.50
Depreciation and Amortization expense 17.40 11.50 18.90 13.00
Exceptional Item - - - 16.20
Profit Before Tax 102.70 42.80 43.60 (1.20)
Tax expense 30.80 23.70 16.20 55.30
Profit After Tax 71.90 19.10 27.40 (56.50)
Paid-up Equity Share Capital 256.20 256.20 252.10 252.10
Earnings Per Share (EPS) 2.81 0.75 1.09 (2.26)

2. COMPANY AFFAIRS

Standalone

On a Standalone basis your Company recorded revenue of Rs. 1076.30million as against Rs. 884.20 million in the after tax stood at Rs. 71.90previousyear.Mindteck'sprofit million as against Rs. 19.10 million in thecorresponding previous year. At an operating margin level Mindteck recorded EBITDA of Rs.126.50 million (11.75%) this year as against Rs. 56.50 million (6.40%) last year.

Consolidated

During the year under review your Company recorded Consolidatedrevenue of Rs. 2994.10 million as against Rs. 2968.40 million in the previous year. Ofthe Consolidated revenue that was recorded 69% is attributed to the US and the balancepertains to the rest of the world.

Mindteck‘s Consolidated profit after tax for the year stood at Rs.27.40 million as against net loss of Rs. 56.50 million in the corresponding previousyear.

At an operating margin level Mindteck recorded EBITDA of Rs. 72.50million (2.40%) this year as against Rs. 33.50 million (1.10%) last year.

There were no material changes and commitments affecting the financialposition of the Company which have occurred between the end of the financial year of theCompany to which the financialstatements relate and the date of the report.

3. DIVIDEND

The Board has recommended a dividend of 10% (Re. 1 per EquityShare of Rs. 10 each) for the year ended March 31 2019. This translates into a totaloutlay of Rs. 30888554 including Dividend Distribution Taxes.

4. BUSINESS FOCUS AND HIGHLIGHTS

Mindteck provides engineering and technology solutions to Fortune 1000companies start-ups leading universities and government entities around the globe. Thecompany is devoted to helping its clients compete innovate and propel forward along thedigital continuum. Mindteck's legacy expertise in embedded systems enterpriseapplications and testing complements newer Analytics Cloud IoT and RPA disciplines andaccompanying solutions and ensures that clients' R&D and technology investmentsare optimised.

Mindteck was ranked as a niche and emerging player in the Zinnov ZonesEngineering and R&D Services Report 2018. As per Zinnov Partner Sidhant Rastogi:"Mindteck has been identified as a niche and emerging player in the Zinnov ZonesER&D ratings 2018. The firm to establish itself as an able service provider for largeenterprises across verticals such as enterprise software storage and medical devices.From a digital engineering perspective the firmis actively working on establishing itsprowess in the IoT space."

Factors underlying the Zone ratings include clientele R&Ddelivery engineering capacity niche capability innovationhasbeenable frameworks andspecific industry alliances partnerships and memberships in global forums.

Mindteck is among a select group of global companies appraised at CMMIDev Ver 1.3 Level 5 of the CMMI Institute's Capability Maturity Model Integration(CMMI). It is also one of the Founding Members of The Atlas of Economic Complexity avisualization tool for research developed by the Center for International Development(CID) at Harvard University.

Global alliances: Intel IoT Solutions Alliance IoT Global

Network Oracle Gold Oracle Cloud GE Digital Alliance and the SmartCities Council India. Partnerships: UiPath noted below.

In 2018 as a part of the company's ongoing commitment to emergingtechnologies Mindteck entered into a partnership with UiPath an industry leader inRobotic

Process Automation (RPA) – a technology that harnesses artificialintelligence to transform business processes.

With RPA software robots are configured to emulate integrate humaninteractions to enable organizations to rapidly automate and benefit from significant costand time efficiencies. In contrast to traditional IT solutions RPA leverages existinginfrastructure without disrupting underlying systems to optimise an organization'sdigital transformation journey.

Analytics

Mindteck's analytics and business intelligence service offeringshelp clients act automatically on their data.

Solutions include: unstructured content analysis unified screeningplatform for the financial services domain and predictive modelling frameworks forinsurance. Reporting support includes: customized mobile dashboards predictiveprescriptive and descriptive business intelligence and analytics along with dataconsolidation management.

Notable analytics projects for the year are as below:

A government project covering 72 government schools with 572 smartclass rooms and 55 labs. Mindteck is providing cloud-based centralized analytics and ERPsolutions along with other best-in–class facilities. Technologies used to developthe software solutions include Angular JS .Net MVC5 Web API HTML 5 SQL server 2018Mongo dB CI/CD model auto scaling cloud infrastructure and IOT.

For a Fortune 500 storage client Mindteck is developing front-endanalytical dashboards.

Engaged with a leading TV manufacturer for AI-based test automation toreduce complex color tuning/ adjustment test times.

For the world's leading power cable manufacturer Mindteck willprovide real-time indoor location tracking and productivity analytics for forklifts andother mobile equipment within their manufacturing facility.

Cloud

Mindteck's Cloud discipline is comprised of a variety ofsolutions including private public and hybrid cloud; application migration anddevelopment; testing. A project highlight for the year at hand involves building andoperating powerful multi-cloud architectures for a cloud computing software company. Thiswill enable end customers to have single point-of-control for managing their ITinfrastructure and applications regardless of project scale. The project engagement alsoincludes cloud testing services for a period of one year.

Internet of Things (IoT)

Mindteck continues to focus on providing monitoring and controlsolutions through the design of various building blocks required for wireless connectivityand system integration for IoT solutions. To address vulnerability from cyber attack withinternet connected devices

Mindteck also focuses on providing secure IoT solutions. Thecompany's in-house technologies in IoT and the smart city space have also helpedreduce solution costs and delivery timelines. A notable win for 2018-19 is the design anddevelopment of a smart medical bin for a pharmaceutical giant including hardware designmechanical design prototype build software development and functional testing

Product Engineering

Mindteck's expertise in end-to-end product engineering is a resultof its rich heritage. Formed by the amalgamation of companies strong in hardware designsystem software development and application development the company has not only retainedthose strengths but also developed them for 27 years and counting.

The company's expertise includes product conceptualizationfeasibility study prototyping hardware design firmware design system software andapplication development system integration quality assurance packaging environmenttesting and certifications.

Important projects for 2018-19 include:

Developing and testing embedded system drivers for a leading lifesciences client that specializes in life sciences analytics. The drivers will enableinteraction between the client's storage capture mechanism and their instruments.

Developing digital control gear to replace the existing analog dimminglighting systems for a client. This is an alternative to open standard Digital SignalInterface (DSI). Mindteck will be designing and developing the control gear includinghardware design application firmware and DALI 2.0 stack development prototypes buildHALT testing pre-compliance and functional testing.

Redesigning an E3-Interface card for one of Asia's largest defenseand engineering companies and targeted for use in the telecom sector. Obsolete componentswill be replaced by available active components without affecting functionality andperformance. Mindteck together with a vendor are designing and developing the E3interface card. The project includes hardware design FPGA firmware design prototypebuild functional testing and production.

Porting and migration of existing software to run on new hardwarearchitecture as well as enhancing the current software for newer features andrequirements for a leading integrated engineering group in the aerospace electronicsland systems and marine sectors. Mindteck will design and develop the software to controlplatform screen doors for specific safety targets in the area of railway safety. Thedevelopment will be in two phases: the first consists of development and testing offirmware on development boards and client-supplied interfaces while the second involvesdevelopment and testing of firmware on actual hardware.

Won two new MS firmware development and hardware production projectswith a leading Singapore-based

Information Communications Technologies (ICT) provider and developer ofsmart city solutions.

An innovative personalized wellness company is consulting Mindteck forthe development of a sleep wellness monitoring device.

Robotic Process Automation

As one or the results of the aforementioned partnership with UiPathMindteck has integrated RPA as a new disciplinewithcorporatesolutionsspecificallytargeted for finance/accounting procurement human resources operations and customersupport. Currently we are building our RPA capabilities through hiring training andcertifications all the while ensuring we build a reusable automation framework.

Testing

Mindteck's hallmark testing discipline spans across domains aswell as legacy and emerging technologies. Solutions include end-to-end automated andmanual test execution and validation; strategy; frameworks and methodologies; functional;automation. Highlights for the year include:

Three-year engagement involving manual automation and cloud testingfor a Fortune 500 storage technology company.

Developing and testing embedded system drivers for a leading lifesciences client.

HALT testing pre-compliance testing and functional testing for a worldleader in sensors and connectors for complex challenges in the harshest environments.

Change in Nature of Business

There were no changes in the Nature of Business of the Company duringthe year.

5. QUALITY

Amidst the rapidly changing technology landscape together withevolving customer expectations Mindteck's Quality team initiated anorganization-wide process transformation journey that encompasses enhancements to existingprocesses the introduction of new lifecycle models and leveraging the latest tools. Thistransformation based on lean and agile concepts reinforces our commitment to deliveringhigh-quality products and services in order to consistently meet ures customerexpectations and comport with the latest International frameworks including CMMIversion 2.0. Progress on this front was appreciated by external auditors during thesuccessful re-certificationof ISO 9001:2015.

During 2018-19 Mindteck's focus on domain-specific standardscontinued with the successful completion of surveillance audits for Medical Devices ISO13495:2016.

We also successfully completed the surveillance audits of ISO27001:2013 related to Information Security.

Repeat business and consistently high customer satisfaction levelsremains a testament to our product and service quality. Our commitment toward ensuringcustomer satisfaction will continue with renewed vigour and unwavering focus in the yearto come.

6. INFRASTRUCTURE

Mindteck has offices in the US Canada UK Singapore

Malaysia Philippines Bahrain Netherlands Germany

Turkey and India. There are also two development centers equipped withR&D laboratories in India (Bengaluru and Kolkata). The infrastructure includes spacefor workstations conference rooms meeting rooms labs and a world-class communicationsystem. This innovative ‘best shore delivery model' has provided our customerswith a mix of onsite offshore near-shore offshore-onsite and other hybrid deliveryoptions across geographies for faster and more efficient delivery of quality services.

7. SUBSIDIARIES

On March 31 2019 Mindteck had seven wholly-owned subsidiaries:Mindteck Inc. (US) Mindteck Middle East S.P.C. (Bahrain) Mindteck Software MalaysiaSDN. BHD. (Malaysia) Mindteck Singapore Pte. Ltd. (Singapore) Mindteck (UK) Limited(UK) Chendle Holdings Limited (British Virgin Islands) and Hitech Parking SolutionsPrivate Limited (India). Mindteck (UK) Limited has two subsidiaries: Mindteck Germany GmbH(Germany) and Mindteck Netherlands B.V. (Netherlands). Mindteck Singapore Pte. Ltd. hasone subsidiary: Mindteck Solutions Philippines Inc. (Philippines) and Mindteck Inc. hasone subsidiary: Mindteck Canada Inc. (Canada).

The Consolidated Financials have been audited and form part of thisAnnual Report. The financials of the subsidiaries have also been audited by the respectiveAuditors. The Consolidated Financials have been prepared and audited in strict compliancewith the applicable

Accounting Standards and SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. All information including (a) capital (b) reserves (c)total assets (d) total liabilities (e) details of investment (except in case of investmentin the subsidiaries) (f) turnover (g) profit before taxation (h) provision for taxation(i) profit after taxation and (j) proposed dividend as directed by the

Ministry of Corporate Affairs has been disclosed in the

Consolidated Financial Statement. Financial Highlights figgiven in thewiththeIndianrupeeequivalentofthe foreign currency along with exchange rate as on closingday of the financialyear and the statement pursuant to Section 129 (3) of the CompaniesAct 2013 in Form AOC-1 forms part of this Board's Report as Annexure-1.

Further the Company undertakes that the annual accounts of theSubsidiary Companies and the related detailed information will be made available to anyinvestor seeking such information at any point of time. The annual accounts of theSubsidiary Companies and related information will also be kept for inspection by anyinvestor at Mindteck's registered office. The Company shall furnish a hard copy ofthe accounts of subsidiaries to any shareholder on demand and a soft copy of accounts isavailable on the Investors section of Company's website www.mindteck.com. TheHolding as well as Subsidiary Companies regularly file the applicable data to variousregulators and government authorities as and when required.

None of the Subsidiaries Joint ventures or Associate companies ceasedduring the year.

8. RELATED PARTY TRANSACTIONS

All Related Party Transactions entered during the financial year wereon an arm's length basis and in the ordinary course of business. There were nomaterial Related Party Transactions made by the Company with Promoters Directors

Key Managerial Personnel or other designated persons and theirrelatives except with its wholly-owned subsidiaries. The particulars of such contracts orarrangements with related party are attached in Annexure-2.

9. LITIGATION

No material litigation was outstanding as on March 31 2019.

The Company has one recovery suit filed in the year 2013 in connectionwith advance payment made for the proposed office premises which was not occupied by theCompany.

10. CHANGES TO SHARE CAPITAL

The Company has not issued any Equity Shares during the FY 2018-19.Hence there is no change in the Share

Capital when compared to last year's Share Capital. The issuedsubscribed and paid up Equity Share Capital was Rs. 256218980 as on March 31 2019.

11. FIXED DEPOSITS

The Company has not accepted any fixed deposits and as such no amountof principal or interest was outstanding as on the Balance Sheet date.

12. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

Loans Guarantees or Investments covered under Section

186 of the Companies Act 2013 forms part of the notes to the FinancialStatements provided in the Annual Report.

13. TRANSFER TO RESERVES

During the year the Company transferred Rs. 71928366 to itsreserves.

14. DIRECTORS

As per Section 152 of the Companies Act 2013 Mr. MeenazDhanani retires by rotation as Director in the ensuing Annual General Meeting and beingeligible offers himself for re-appointment. A brief resume of Mr.

Meenaz Dhanani is included in the Annexure to the Notice of the AnnualGeneral Meeting. Mr. Jagdish Malkani an

Independent Director of the Company was appointed for five (5) yearseffective from August 14 2014 and his term ends on August 13 2019. The Nomination andRemuneration Committee and the Board have recommended the candidature of Mr. JagdishMalkani who fulfils the requisite criteria of an Independent Director for a second term offive (5) years effective from August 14 2019 to the Members of the Company in theensuing Annual General Meeting for their approval.

Declarations by Independent Directors

All Independent Directors have given declarations to the effect thatthey meet the criteria of independence as laid down under Regulation 16(1)(b) and 25 ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 andSub-Section 6 and 7 of Section 149 of the Companies Act 2013.

Board Evaluation

Pursuant to the provisions of the Companies Act 2013 and SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Company has carried out anannual performance evaluation of the Board Individual Directors as well as Committeesand Chairperson.

Board Diversity

The Company places great emphasis on the principle of diversityincluding gender diversity. Diversity throughout the organization makes great businesssense. The Company maintains that appointments to the Board should be based on merit aswell as complementing and expanding the skills knowledge and experience of the

Board as a whole.

Policy on Directors' appointment and remuneration

Mindteck has an appropriate mix of Executive Non-Executive andIndependent Directors to maintain the independence of the Board and separate its functionsof governance and management. As on date the Board consists of eight Directors one ofwhom is Managing

Director and CEO; two are Non-Executive; and five are IndependentDirectors including one woman Director.

The Board periodically evaluates the need for change in its compositionand size. The policy of the Company on Directors' appointment and remunerationincluding criteria for determining qualifications positive attributes independence of aDirector and other matters as provided under Sub-Section (3) of Section 178 of theCompanies Act 2013 adopted by the Board and uploaded on the

Company's website (www.mindteck.com). We affirm that theremuneration paid to the Directors is as per the terms.

Number of meetings of the Board

The Board met four times during the Financial Year the details ofwhich are given in the Corporate Governance report that forms part of this Annual Report.The intervening gap between two meetings was within the limit prescribed by the CompaniesAct 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

Vigil Mechanism/Whistleblower Policy

The Company has established a Whistleblower Policy for DirectorsEmployees and other Stakeholders to report their genuine concern and the said policy isattached as per Annexure-3.

Constitution of Internal Compliance Committee

The Company has complied with the provisions relating to theconstitution of Internal Complaints Committee under the Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013.

15. AUDITORS Statutory Auditor

At the 26th Annual General Meeting held on August 11 2017 Members ofthe Company appointed Statutory Auditor S.R. Batliboi & Associates LLP CharteredAccountants (Firm Registration No. 101049W/E300004) Bengaluru for a period of five (5)years who shall hold the office up to the conclusion of the 31st Annual General Meeting.During the year the Statutory Auditor confirmed its eligibility and independence criteriato hold office.

Secretarial Auditor

CS S Kannan a Practicing Company Secretary was appointed to conductthe Secretarial Audit of the Company for the FY 2018-19 as required under Section 204 ofthe Companies Act 2013 and Rules thereunder. The Secretarial Audit Report for the FY2018-19 forms part of this Board's Report as Annexure-4.

Cost Auditor

The maintenance of cost records as specified by the

Central Government under Sub-Section (1) of Section 148 of theCompanies Act 2013 is not applicable to the Company and accordingly such accounts andrecords are not maintained.

The Board noted the reports provided by the Statutory

Auditor and Secretarial Auditor and confirmed that there are noqualifications reservations or adverse remarks.

16. EXTRACT OF ANNUAL RETURN

In accordance with Section 134(3)(a) of the Companies Act 2013 anextract of the annual return in the prescribed format is attached as Annexure-5 tothe Board's Report.

17. SIGNIFICANT AND MATERIAL ORDERS

There were no significant the Regulators the Courts or Tribunalsimpacting the going concern status and the Company's operation in the future.

The details of Tax Matters are disclosed in the Standalone FinancialStatements.

18. INTERNAL FINANCIAL CONTROL

The Board has adopted the policies and procedures for ensuring theorderly and efficient conduct of its business including adherence to the Company'spolicies safeguarding its assets prevention and detection of frauds and errors accuracyand completeness of the accounting records and timely preparation of the reliablefinancial disclosures.

19. INDEPENDENT DIRECTORS FAMILIARISATION PROGRAMME

Mindteck has an established familiarisation programme for itsIndependent Directors. The business heads Managing Director and the Company Secretarymake presentations on business models nature of industry and its dynamism the rolesresponsibilities and liabilities of Independent Directors. Further updates on businessstatutory law and industry are made available to

Independent Directors especially to the Audit Committee members on anongoing basis by internal teams and Statutory and Internal Auditors on a quarterly basis.

20. PARTICULARS OF EMPLOYEES

The table containing the names and other particulars of employees inaccordance with the provisions of Section 197(12) of the Companies Act 2013 read withRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 is attached as Annexure-6 to the Board's report.

The list of employees who were employed throughout the financial yearand in receipt of remuneration of Rs.102 lakhs or more or employed for part of the yearand in receipt of Rs. 8.50 lakhs or more per month and the List of Top 10 employees underRule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 are in the following page. and material orders passed by

Top 10 employees of the Company based upon the remuneration drawnduring the FY 2018-19

Employee Name

Designation

Remuneration Received (in Rs.)

Nature of Employment

Qualification

Experience (in years)

Date of Commencement of Employment

Age

Last Employment

Percentage of Equity shares held by the employee in the Company

Any such employee is a relative of any Director or manager of the Company and if so name of such Director or Manager

Sanjeev Kathpalia Managing Director and CEO 12486804 Contractual B.Tech (IIT) MBA (IIM) 37 01-Mar-17 66 Senior Advisor to the Prime Minister (Republic of Turkey) 0.12% NO
Prashanth Idgunji Chief Financial Officer 7911101 Employee C.A. CPA 32 28-Aug-17 54 Liquid Hub India Private Limited NIL NO
Arup Banerjee Senior Vice President - MS 5371475 Employee B. Tech 30 08-Jul-11 53 HCL Technologies Ltd 0.02% NO
Surjit Lahiri Vice President - Technology 5192308 Employee B. Tech 27 29-Mar-05 49 Novellus India Pvt Ltd 0.03% NO
Mahendra Balagangadharan(1) Chief People Officer 4444744 Employee B.E. (CS) MPM (HR) 23 24-Oct-17 49 VFS Global Services Pvt. Ltd NIL NO
Shivarama Adiga S. Vice President -Legal and Company Secretary 3998452 Employee C.S M.Com and LLB 41 18-Mar-13 60 Diligent Media Corporation Limited 0.03% NO
Girish Chandrasekhar Pachuveetil Associate Vice President - Delivery 3532020 Employee MS 24 09-Apr-15 51 CGI Info Systems and Management Consultants Pvt. Ltd. NIL NO
Ranjit Balakrishnan Regional Business 3265892 Employee MBA 21 05-Jul-17 44 Sasken Technologies NIL NO
Shreerama Development Manager Senior Vice 3196283 Employee MSc. 22 25-Jun-18 48 Mindtree Limited NIL NO
Muniyoor (2) Ayushman Ghosh President - Delivery Senior Technical Program Manager 3138524 Employee MSc. 27 01-Jul-99 50 PCL Mindware 0.01% NO

(1) Part of the Year-Resigned w.e.f. January 25 2019. (2) Part of theYear- Appointed w.e.f. June 25 2018.

List of employees who were employed throughout the financial year andin receipt of remuneration of Rs.102 lakhs or more or employed for part of the year andin receipt of Rs. 8.50 lakhs or more per month

Employee Name

Designation

Remuneration Received (in Rs.)

Nature of Employment

Qualification

Experience (in years)

Date of Commencement of Employment

Age

Last Employment

Percentage of Equity shares held by the employee in the Company

Any such employee is a relative of any Director or manager of the Company and if so name of such Director or Manager

Sanjeev Kathpalia Managing Director and CEO 12486804 Contractual B.Tech (IIT) MBA (IIM) 37 01-Mar-17 67 Senior Advisor to the Prime Minister (Republic of Turkey) 0.12% NO
Anand Balakrishnan (1) Chief Operating Officer 2623154 Employee CA 26 30-Jan-19 46 Wipro GE Healthcare Private Limited NIL NO

(1) Part of the Year- Appointed w.e.f. January 30 2019.

21. COMMITTEES OF THE BOARD

Currently the Board has four Committees: Audit Committee Nominationand Remuneration Committee Corporate Social Responsibility Committee and StakeholdersRelationship Committee.

A detailed note on the Board and its Committees is provided under theCorporate Governance report in this Annual Report. The composition of the Committees andcompliances as per the applicable provisions of the Act and Rules are as follows:

Name of the Committee Composition of the Committee Highlights of duties responsibilities and activities
Audit Committee Mr. Jagdish Malkani – Chairman The Committee oversees the Company's financial reporting process and disclosures of its financial information to ensure accuracy and reliability.
Mr. Satish Menon– Member
Mr. Guhan Subramaniam – Member
Mr. Sanjeev Kathpalia Member The Company has adopted the Whistleblower Policy for Directors Employees and other Stakeholders to report concerns about unethical behavior actual or suspected fraud or violation of the Company's Code of Business Conduct and Ethics. The Whistleblower Policy is attached as Annexure-3 to the Board's Report.
In accordance with the Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the Company has formulated policies on related party transactions and material subsidiaries. The policies including the Whistleblower Policy are available on the Company's website.
Nomination and Ms. Prochie Mukherji – Chairperson The Committee oversees and administers executive compensation operating under a written charter adopted by the Board of Directors.
Remuneration Committee Mr. Jagdish Malkani – Member
Mr. Guhan Subramaniam – Member
Mr. Subhash Bhushan Dhar –Member
The Committee has designed and continuously reviews the compensation program for the Managing Director and senior executives to align both short and long- term compensation with business objectives and to link compensation with the achievement of measurable performance goals.
The Committee structures compensation to ensure that it is competitive in the global markets in which it operates in order to attract and retain the best talent. The Committee intends to have a combination of stock options and performance-based stocks to align senior employee compensation.
The Nomination and Remuneration Committee has framed the Nomination and Remuneration policy. A copy of the policy is uploaded on the Company's website (Weblink: https://www.mindteck.com/assets/ investor_pdf/Nomination_Remuneration_Policy.pdf).
Corporate Social Responsibility Committee Mr. Yusuf Lanewala Chairman
Mr. Satish Menon – Member The Board has laid out the Company's policy on Corporate Social Responsibility (CSR) and the CSR activities of the Company are carried out as per the instructions of the Committee.
Mr. Sanjeev Kathpalia Member
The Company allocates 2% of its average net profits of three years immediately preceding the financial year for CSR activities to various beneficiaries.
Financial data pertaining to the Company's CSR activities to various beneficiaries for the FY 2018-19 is attached under the prescribed format in Annexure -7 to the Board's Report.
The contents of the CSR policy are available on the Company's website (Weblink: https://www.mindteck. com/assets/investor_pdf/CSR_Policy.pdf)
Stakeholders Relationship Mr. Satish Menon – Chairman The Committee reviews and ensures redressal of investor grievances.
Committee Mr. Meenaz Dhanani – Member
Mr. Sanjeev Kathpalia Member The Committee notes all the grievances of the investors and takes suitable action accordingly.

22. RISK MANAGEMENT

The Company has a robust Enterprise Risk Management (ERM) framework toidentify and evaluate business risk opportunities. This framework seeks to createtransparency minimize adverse impact on business objectives and enhance theCompany's competitive advantage. The business risk policy defines the risk managementapproach across the enterprise at various levels including documentation and reporting.The model has different modes that help in identifying risk trends exposure and potentialimpact analysis at a Company level and also separately for different business segments.

The Company has identified various risks and also has mitigation plansfor each risk identified.

23. CORPORATE GOVERNANCE REPORT

Mindteck recognises good Corporate Governance and is committed to soundcorporate practices based on conscience openness fairness professionalism andaccountability for the benefit of its stakeholders and for long-term success. Mindteckadheres to the standards set by SEBI for Corporate Governance practices as per SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 and a Certificate onCorporate Governance pursuant to Regulation 34 read with Schedule V of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 forms part of this report in Annexure-8.The details of the Directors' remuneration are disclosed in PARA VI of Annexure-5of this Report.

24. MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis is part of this Annual Report.

25. DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to theinformation and explanations obtained by the

Company the Directors made the following statements in terms ofSection 134 (3) (c) of the Companies Act 2013:

a. that in the preparation of the annual financial statements for theyear ended March 31 2019 the applicable accounting standards have been followed alongwith proper explanation relating to material departures if any; b. that such accountingpolicy as mentioned in Note 2 of the Notes to the Financial Statements have been selectedand applied consistently. Judgment and estimates have been made that are reasonable andprudent so as to give a true and fair view of the state of affairs of the Company as atMarch 31 2019 and of the profit of the Company for the year ended on that date; c. thatproper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities; d.that the annual financial statements have been prepared on a going concern basis; e. thatproper internal financial controls were in place and that the financial controls wereadequate and were operating effectively; f. that systems to ensure compliance with theprovisions of all applicable laws were in place and were adequate and operatingeffectively.

26. CSR INITIATIVES

We Care is Mindteck's brand experience framework which encompasseshonoring our commitments and making a lasting difference throughout the organization aswell as externally to clients partners and communities. The cornerstones of the frameworkare Knowledge Opportunity Advocacy Inclusion Goodwill and Respect.

Care is rooted in the ways we engage and enable and fundamental tobuilding and nurturing relationships championing others and stewarding community causes.We Care Ambassadors represent our brand and in concert with others in the Company workto ensure a positive experience. This includes but is not limited to fostering a caringculture and business approach.

Our Corporate Social Responsibility (CSR) commitment is part of WeCare. We believe that through our successes around the globe we should give back in kindand deed. We do what we can to create shared value and steward our resources to createhopeful tomorrows for others. Core pillars of our CSR endeavors are Global Education andLocal Targeted Giving.

We believe in the empowerment of knowledge and how it helps to bringpositive change and stability to society as a whole; we also know that giving to localorganizations that embrace the interests and values of the communities we serve buildsstronger communities and makes business sense.

In FY 2018-19 more than 2% of Mindteck's previous threeyears' average net profits were allocated towards the following India initiatives:Gandhi Old Age Home: In November 2018 Mindteck donated a commercial washing machine tothe Gandhi

Old Age Home. The institution had long expressed the need for a largewashing machine for its residents. The

Home is funded exclusively with the help of private donations.Previously as part of its CSR efforts in FY 2016-17 Mindteck donated an ambulance.

Swami Vivekanand Shiksha Samiti: Mindteck funded the Pink Parkingproject for the City of Bhopal. The dedicated women-only parking spaces were inauguratedon Women's Day at three different sites (New Market Pragati and 10 No. Market).

Mantra4Change: Once again this year Mindteck contributed toward the‘School Readiness Program' for Early Childhood Education (ECE).

27. MINDTECK EMPLOYEES STOCK OPTION SCHEMES

Mindteck believes in the policy of enabling Mindteckers to participatein the ownership of the Company and share in its wealth creation as they are responsiblefor the Management growth and success of the Company. The Company has three EmployeesStock Option Schemes: Mindteck Employees Stock Option Scheme 2005 Mindteck EmployeesStock Option Scheme 2008 and Mindteck Employees Stock Option Scheme 2014. a. MindteckEmployees Stock Option Scheme 2005

During the year ended March 31 2019 under this Scheme the Companygranted 24000 options on

May 29 2018 at an exercise price of Rs. 55.15 per share to eligibleemployees. There has been no variation in the terms of ESOP Scheme during the year. b.Mindteck Employees Stock Option Scheme 2008

During the year ended March 31 2019 under this Scheme the Companygranted 170000 options on

August 14 2018 at an exercise price of Rs. 48.70 to eligibleemployees. There has been no variation in the terms of ESOP Scheme during the year. c.Mindteck Employees Stock Option Scheme 2014

During the year ended March 31 2019 under this Scheme the Companygranted 100000 options on

February 26 2019 at an exercise price of Rs. 34.70 to an eligibleemployee. There has been no variation in the terms of ESOP Scheme during the year.

The Details of the Employees Stock Option Schemes as required underRegulation 14 of SEBI (Share Based Employee Benefits) Regulations 2014 are the website ofthe Company.

(Weblink: https://www.mindteck.com/assets/investor_pdf/Disclosures-pursuant-to-SEBI-Regulations-2014. pdf).

28. MINDTECK EMPLOYEES WELFARE TRUST

The Mindteck Employees Welfare Trust was set up in the year 2000 toimplement the Company's Share

Incentive Scheme. As on March 31 2019 the said Trust holds 416000shares of the Company and has not yet transferred any shares to the Company'semployees under the said scheme.

29. CONSERVATION OF ENERGY RESEARCH AND

DEVELOPMENT TECHNOLOGY ABSORPTION FOREIGN EXCHANGE AND OUTGO

Particulars that are required to be disclosed under SubSection (3)(m)of Section 134 of the Companies Act 2013 read with the Companies (Accounts) Rules 2014are set out in Annexure-9 included in this Report.

30. ACKNOWLEDGEMENTS

The Directors place on record their appreciation of cooperation andcontinued support extended by customers shareholders investors partners vendorsbankers the Government and statutory authorities for the Company's growth. We thankemployees at all levels across the Group for their valuable contribution in our progressand look forward to their continued support.

for and on behalf of the Board of Directors

Yusuf Lanewala Sanjeev Kathpalia
Chairman Managing Director and CEO
(DIN: 01770426) (DIN: 05257060)
Bengaluru India
May 28 2019 on