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Tata Investment Corporation Ltd.

BSE: 501301 Sector: Financials
NSE: TATAINVEST ISIN Code: INE672A01018
BSE 00:00 | 26 Feb 1106.05 -14.50
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NSE 00:00 | 26 Feb 1109.75 -11.20
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OPEN 1120.00
PREVIOUS CLOSE 1120.55
VOLUME 4303
52-Week high 1133.90
52-Week low 592.15
P/E 54.32
Mkt Cap.(Rs cr) 5,597
Buy Price 1100.00
Buy Qty 1.00
Sell Price 1104.00
Sell Qty 44.00
OPEN 1120.00
CLOSE 1120.55
VOLUME 4303
52-Week high 1133.90
52-Week low 592.15
P/E 54.32
Mkt Cap.(Rs cr) 5,597
Buy Price 1100.00
Buy Qty 1.00
Sell Price 1104.00
Sell Qty 44.00

Tata Investment Corporation Ltd. (TATAINVEST) - Director Report

Company director report

TO

THE MEMBERS

The Directors present their Eighty Third Annual Report with the Audited Financial Statements for the year ended 31st March 2020.

1. FINANCIAL RESULTS (under Ind AS) :

Standalone

Consolidated

Previous YearPrevious Year
(Rs in crore)(Rs in crore)(Rs in crore)(Rs in crore)
Dividend Interest Net gain on Fair Value changes & Others 149.47181.74143.89177.05
Other Income 0.090.100.090.10
Total Income 149.56181.84143.98177.15
Total Expenses 20.3521.2137.7021.31
Share in Profit and Loss of Associates

-

-(5.52)(8.90)
Profit before tax 129.21160.63100.76146.94
Less: Provision for tax 10.5712.9810.6713.12
Profit after tax 118.64147.6590.09133.82
Non-Controlling Interest --0.44(0.04)
Profit attributable to equity holder of the Company 118.64147.6590.53133.78
Earnings Per Share Basic and Diluted (Rupees) 23.4527.0217.8924.48
Opening balance of retained earnings 677.54577.45757.81669.33
Profits for the year 118.64147.6590.53133.78
Other Comprehensive Income 0.49(0.49)0.49(0.44)
Realised gains on equity shares carried at fair value through OCI 126.55118.78162.13118.72
The Directors have made the following appropriations -
-Dividend (including tax on dividend) (Refer Para 3)*....121.99132.85121.99132.85
-Buy Back expenses -3.47-3.47
-Transfer to Statutory Reserve & Other Reserves 23.8029.5323.8029.87
Closing balance of retained earnings 777.43677.54865.48757.81

* Pertaining to dividend for the Financial Year 2018-19 paid in 2019-20

2. OPERATIONS:

The Standalone Operating Income of the Company is derived from a mix of dividend interest income and other income. The profit from the sale of long-term equity investments (post tax) for the year ended 31st March 2020 is Rs 126.55 crores as compared to Rs 118.78 crores for the FY 2018-19 which have been carried at Fair Value through Other Comprehensive Income. The standalone profit before tax for the year under review is Rs 129.21 crores as against Rs 160.63 crores for the FY 2018-19 whereas the profit after tax for the year under review stands at Rs 118.64 crores as against Rs 147.65 crores for the FY 2018-2019. The Consolidated profit after tax for the year amounted to Rs 90.09 crores as compared to Rs 133.82 crores for the FY 2018-19.

The total number of companies held in the equity / bond portfolio of the Company stands at 88 as on 31st March 2020 out of which 69 are Quoted and 19 are Unquoted companies.

3. DIVIDEND:

The Directors are pleased to recommend a dividend of Rs 18 per share (180%) [previous year Rs 20 per share (200%)] on the paid-up capital of Rs 50.59 crores aggregating Rs 91.07 crores based on the parameters laid down in the Dividend Distribution Policy. Pursuant to Finance Act 2020 dividend income will be taxable in the hands of shareholders w.e.f. 1st April 2020 and the Company is required to deduct tax at source from dividend paid to shareholders at the prescribed rates in the Income Tax Act 1961.

4. TRANSFER TO RESERVES:

The closing balance of the retained earnings of the Company for FY 2019-20 after all appropriation and adjustments was Rs 777.43 crores (as on 31st March 2019'677.54 crores).

5. VALUE CREATED:

Shareholders will recall that for the first time in the Annual Report of 31st March 2015 the Company had shared the Value Created over a 15-year period. The table below analyses the performance of the Company's portfolio rolling over the period to the 15 years prior to the closing of the current financial year 31st March 2020. Value Created is a measure which evaluates the wealth created net of the capital invested by the shareholders. Value Created is the Realisable Value of Investments as on 31st March to which is added Net Other Assets and Fixed assets while any contribution from shareholders is reduced (i.e. equity and share premium). The following table shows the Value Created over 15-year period and comparative returns to the Benchmark.

Year End (31st March)Realisable Value of Investments ( A )Net Current Assets ( B )Shareholder Funds (Equity +Share Premium) ( C )Value Created (A)+(B)-(C)BSE 200
(Rs crs)(Rs crs)(Rs crs)(Rs crs)
20051490.05(23.64)80.311386.10868
20208049.47(75.52)355.627618.333610
Nos of times (X)5.504.16
CAGR12.03%9.97%

Shareholders will be pleased to note that the Value Created has recorded a compounded annual growth rate (CAGR) of 12.03 % vis-a-vis the BSE 200 CAGR of 9.97 % for the 15-year period 31st March 2005 to 31st March 2020. It is heartening that this performance has been achieved while the management has endeavoured to reduce risk of the portfolio with a prudent allocation to unlisted equity and fixed income securities.

The Company has consistently declared dividend which over the last 15 years has aggregated Rs 1430 crores.

6. MANAGEMENT DISCUSSION & ANALYSIS:

A summarised position of the company's portfolio of investments is given below:-

As on 31.03.2020As on 31.03.2019
(Rs in crore)(Rs in crore)
QUOTED INVESTMENTS
Net Book Value 1896.021784.40
Market Value 7287.268511.32
UNQUOTED INVESTMENTS
Net Book value. (including Mutual Funds) 439.80435.17
Estimated value 762.21829.59
TOTAL BOOK VALUE
Net Book value of all investments 2335.822219.57
TOTAL REALISABLE VALUE
Total market value of quoted investments and estimated value of unquoted investments (subject to tax as applicable) 8049.479340.91
BANK DEPOSITS AND INTERCORPORATE DEPOSITS 25.4010.00
TOTAL NUMBER OF COMPANIES (excluding Mutual Funds) 8891
TOTAL EQUITY PER SHARE
After tax (Rs) 15761546

The Directors confirm that all the investments have been made with the intent to hold for long term appreciation to enhance the income from dividends and are not held for trade.

The Company continues to remain invested in leaders in sectors which we believe have the potential to remain value accretive over the long term. The Company continues to invest for the long term while availing opportunities to realize gains endeavouring to maintain its policy of consistent dividend distribution.

The Company invests in Tata and Non-Tata companies both listed and unlisted though investments in Tata companies constitute a larger portion and may be considered for a longer term and are strategic in nature.

The Company endeavours to evaluate opportunities considering the macroeconomics conditions both globally and domestically.

GLOBAL EQUITY MARKETS DURING THE FINANCIAL YEAR 2019-20:

In this Covid-19 impacted environment that we are in today it is indeed difficult to comprehend that just a few months ago the MSCI world Index rose to its all-time high of 2435 as late as 12th February 2020. Thereafter in March almost simultaneously all nations of the world reacted to the potential health risk arising from the spread of Coronavirus Covid-19. Every border was locked down for travel and the nervousness in global sentiment drove markets into a steep correction with the MSCI World Index falling vertically down to 1602 points on 23rd March 2020. The damage to the world economies may have been higher in this lockdown than that experienced during the Financial Crisis in 2009.

It is now an accepted paradigm - the world changed in March 2020. As things stand in May 2020 the world is enveloped with lower demand for many products and industries excess and growing leverage in the balance sheets of the Central Banks governments and companies and unprecedented unemployment and finally a spiral rise in bankruptcies.

Without doubt the War against Covid-19 is the most expensive war ever fought in the history of mankind. The world at large against one unseen enemy. The World Leaders have chosen lockdown as the defence against the Weapon of Mass Destruction - Covid-19. Historians and scientists will one day compute the cost-benefit of choosing Lockdown to save lives against loss of livelihood.

The landscape of industries like Airlines Hotels Online Booking aggregators Oil & Gas has been marred for a long time to come. According to market research by IBIS World a leading business intelligence firm the total revenues for the oil and gas drilling sector (upstream) came to approximately $3.3 trillion in 2019 or approximately 3.8% of the global economy. The exploration and production sector employs approximately 4 million people across 350000 businesses. Even when activity resumes in the world to a New Normal demand for oil will be much lower than 2019. Fortunately the price of oil has moved up to above US$30 per barrel.

A similar negative outlook is for the Hospitality Industry. Until a vaccine is invented and all travellers vaccinated the demand for Travel and Hotel stays may remain subdued.

Indian Equity Markets

The Indian equity indices have tracked the global markets with near perfect correlation. The Sensex peaked to its alltime high on 20th January 2020 to 42274 level and thereafter corrected sharply to 25639 on 24th March 2020 (a fall of 39% in two months). The Index has moved up from those lows to around 32000 in the month of May 2020. Many read this up move as a Bear market rally' which is always also sharp upwards but may not sustain over the year. Many others believe that with the opening up of the economy a promising monsoon substantially higher global liquidity the financial support of the RBI and the Finance Ministry the markets may remain in an uptrend for the better part of the year.

Indian Economy

India has had at least till this report was written globally the lowest per capita number of Covid-19 cases and deaths. Perhaps China can only compare their per capita impacted cases to India. In India it could have been a healthcare calamity if the government had not imposed a complete lockdown. On an optimistic note this will mean that the gradual opening up of the lockdown may result in a relatively faster normalization of activity having averted what may have been substantially higher pain of loss and hopelessness.

Perhaps the biggest opportunity for India could be that many manufacturers want to move out of China as a strategy for de-risking. Japan has announced a USD 2 billion subsidy for such shifts of capacity. Government of India must invite foreign companies with open hands and lay out the red carpet for them. In all areas of government which work with business i.e. Taxation FDI Judiciary and Labour India must become as competitive as Vietnam Thailand Malaysia and Indonesia. The Asian Tigers cannot be the sole winners in this mega metamorphosis of manufacturing relocation. India has to endeavour to become the most attractive destination.

CMIE report says that early estimates of jobs data indicate that the coronavirus effect may have left a devastating impact on the economy sending the urban unemployment rate soaring to 30.9% and overall unemployment rose to 23.4%.

It is imperative that India creates employment opportunities and higher distributable income in the hands of individuals especially millennials for consumption to grow. Manufacturing must make a comeback in India if GDP growth has to once again rise above 7%.

The sudden breakdown in employment opportunities has shown that leveraged consumption growth can be harmful to both borrowers and lenders. India has far higher interest rates than the developed world. Thus growth in demand for discretionary consumption goods which may result in higher unsecured loan exposures may remain subdued.

Needless to say that some of the Investee companies in our portfolio will suffer in these circumstances for the better part of the year. The share prices of these companies may also suffer underperformance.

It is very heartening to note that in a year when the market suffered the worst correction experienced since 2009 your Company's Total Equity (which includes Other Comprehensive Income) has marginally gone up from Rs 7820.21 crores as on 31.03.2019 to Rs 7973.95 crores as on 31.03.20. On a per share basis the Total Equity has increased from Rs 1546 as on 31.03.2019 to Rs 1576 as on 31.03.2020.

What is our strategy going forward? Your company has continued to reduce the number of companies in its portfolio while retaining India's market leaders amongst other competitive and financially strong companies. Your company will allocate its capital between listed equity fixed income and unlisted equity. Management will evaluate and select investments based on high quality governance sustainability and balance sheets. In this disruption we will look for emerging sectors and companies which may become the leaders in the next decade.

7. FIXED DEPOSITS:

The Company has not accepted any public deposits under the provisions of the Companies Act 2013 ('Act').

8. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:

The provisions of section 186 of the Act pertaining to investment and lending activities are not applicable to the company since the company is a Non Banking Financial Company (NBFC) whose principal business is acquisitions of securities. During the year under review the Company has not provided any guarantee.

9. CONSOLIDATED FINANCIAL STATEMENTS:

The Consolidated Financial Statements of the Company form part of the Annual Report.

The annual accounts of the subsidiary company and related detailed information are available on the website of the Company and the same may be obtained by writing to the Company Secretary at the Registered e-mail ID of the Company: ticl@tata.com.

The consolidated financial results reflect the operations of Simto Investment Company Ltd. (Simto) (Subsidiary) and the following Associate Companies namely Tata Asset Management Ltd. Tata Trustee Company Ltd. and Amalgamated Plantations Private Ltd.

The Company has adopted a Policy for determining Material Subsidiaries in terms of Regulation 16(1)(c) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (SEBI Listing Regulations''). The Policy as approved by the Board is uploaded on the Company's website: https://tatainvestment.com/images/Policy%20on%20 Material%20Subsidiaries.pdf

Subsidiary Company

The Company has a subsidiary Simto which is registered as an NBFC with the Reserve Bank of India. In terms of Regulation 16 (1) (c) of the SEBI Listing Regulations Simto is not a material unlisted subsidiary. Simto is engaged in investment activities which allocates capital in the markets to participate in activities other than making investments for the long term which has been the primary activity of the Company for many decades.

Simto has an Issued Capital of Rs 1.53 crores with a net worth of Rs 48.53 crores as on 31st March 2020.

Associate Companies

1. Tata Asset Management Ltd.

The Company holds 32.09% of the equity share capital of Tata Asset Management Ltd. whose principal activity is to act as an investment manager to Tata Mutual fund and the company is registered with Securities Exchange Board of India (SEBI) under the SEBI (Mutual Fund) Regulations 1996. The consolidated turnover of the company during the year was Rs 216.55 crores and Profit after tax for the year was Rs 22.25 crores. The company has a net worth of Rs 272.78 crores as on 31st March 2020.

2. Tata Trustee Company Ltd.

The Company holds 50% of the equity share capital of Tata Trustee Company Ltd. which is acting as the Trustees to Tata Mutual Fund. During the year the turnover of the company was Rs 7.09 crores and Profit after tax for the year was Rs 3.66 crores. The Company has a net worth of Rs 12.83 crores as on 31st March 2020.

3. Amalgamated Plantations Private Ltd.

The Company holds 24.61% of the equity share capital of Amalgamated Plantations Private Ltd. (APPL) which is engaged in the business of cultivation and manufacturing of tea and other allied agricultural products and packaging services. The turnover of APPL during the year was Rs 701.02 crores and registered a loss of Rs 54.80 crores during the financial year 2019-20.

A statement containing the salient features of the financial statements of the subsidiary company and associate companies is annexed to the Financial Statements in Form AOC-1 Annexure A.

10. BOARD AND COMMITTEE MEETINGS:

During the year under review Eight Board Meetings and Eighteen other Committee Meetings were held. The details of the composition of the Board and its Committees and of the Meetings held and attendance of the Directors at such Meetings are provided in the Corporate Governance Report. There have not been any instances during the year when recommendations of the Audit Committee were not accepted by the Board.

11. DIRECTORS' RESPONSIBILITY STATEMENT:

Based on the framework of internal financial controls and compliance systems established and maintained by the Company work performed by the internal statutory and secretarial auditors including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by Management and the relevant Board Committees including the Audit Committee the Board is of the opinion that the Company's internal financial controls were adequate and effective during the financial year 2019-20. -

Accordingly pursuant to Section 134(3)(c) and 134(5) of the Act the Board of Directors to the best of their knowledge and ability confirm that: -

i) in the preparation of the annual accounts the applicable accounting standards have been followed and that there are no material departures;

ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) they have prepared the annual accounts on a going concern basis;

v) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively;

vi) They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

12. RISK MANAGEMENT:

The Company has adopted a Risk Management Policy in accordance with the provisions of the Act and Regulation 17(9) of the SEBI Listing Regulations. It establishes various levels of risks with its varying levels of probability the likely impact on the business and its mitigation measures.

The Internal Auditor evaluates the execution of Risk Management Practices in the Company in the areas of risk identification assessment monitoring mitigation and reporting. Asset Liability Risk Management and IT Strategy and Steering Committee oversees the Risk Management and reports to the Audit Committee as well as the Board of Directors about risk assessment and management procedures and status from time to time.

13. INTERNAL CONTROL SYSTEMS:

The Company maintains appropriate systems of internal controls including monitoring procedures to ensure that all assets and investments are safeguarded against loss from unauthorized use or disposition. Company policies guidelines and procedures provide for adequate checks and balances and are meant to ensure that all transactions are authorized recorded and reported correctly.

The Internal Auditors review the efficiency and effectiveness of these systems and procedures. Added objectives include evaluating the reliability of financial and operational information and ensuring compliances with applicable laws and regulations. The Internal Auditors submit their Report periodically which is placed before and reviewed by the Audit Committee.

14. VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The Company has revised the Whistle Blower Policy to provide a formal mechanism to the Directors and employees to report their concerns about unethical behaviour actual or suspected fraud or violation of the Company's Code of Conduct or ethics policy. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.

15. RELATED PARTY TRANSACTIONS:

All Related Party Transactions that were entered into during the financial year were on an arm's length basis in the ordinary course of business and were in compliance with the applicable provisions of the Act and the Listing Regulations.

There were no materially significant Related Party Transactions made by the Company with Promoters Directors Key Managerial Personnel which may have a potential conflict with the interest of the Company at large.

All Related Party Transactions are placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee is obtained for the transactions which are repetitive in nature. A statement of all Related Party Transactions is placed before the Audit Committee for its review on a quarterly basis specifying the nature value and terms and conditions of the transactions if any.

The Company has adopted a Related Party Transactions Policy. The Policy as approved by the Board is uploaded on the Company's website at the web link: https://tatainvestment.com/images/Policy%20on%20Related%20Party%20Transactions.pdf

Given all the Related Party Transactions during the year under review were at arm's length and in the ordinary course of business and the Company did not enter into any material transaction with any related party and hence Form AOC-2 does not form part of this report.

The details of the transactions with Related Parties are provided in the accompanying financial statements.

16. CORPORATE SOCIAL RESPONSIBILITY (CSR):

I n terms of Section 135 and Schedule VII of the Act the Board of Directors has constituted a Corporate Social Responsibility (CSR) Committee under the Chairmanship of Mr. F N. Subedar. Mr. A. N. Dalal Mr. S. Mukhopadhyay and Mr. V. Chandrasekaran are the other members of the Committee.

Mr. Z. Dubash Independent Director of the Company and a member of the Corporate Social Responsibility (CSR) Committee has retired with effect from 17th March 2020 and the Company has reconstituted the Committee by inducting Mr. Suprakash Mukhopadhyay and Mr. V. Chandrasekaran as the members of the CSR Committee.

The CSR committee of the Board has framed a CSR policy and uploaded it on the website of the company: http://www. tatainvestment.com/images/CSR_Policy.pdf

The Annual Report on CSR activities is annexed herewith as Annexure B.

17. POLICY ON PREVENTION PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORKPLACE:

The Company has adopted a policy on Prevention Prohibition and Redressal of Sexual Harassment at the Workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 and the Rules thereunder. The Policy aims to provide protection to employees at the workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto with the objective of providing a safe working environment where employees feel secure. The Company has also constituted an Internal Complaints Committee known as the Prevention of Sexual Harassment (POSH) Committee to inquire into complaints of sexual harassment and recommend appropriate action.

The Company has not received any complaint of sexual harassment during the financial year 2019-2020.

18. DIVIDEND DISTRIBUTION POLICY:

In term of Regulations 43A of SEBI Listing Regulations the Board of Directors of the Company has adopted a Dividend Distribution Policy which is annexed herewith as Annexure C. The Policy is also available on the website of the Company: http://www.tatainvestment.com/images/Dividend%20Distribution%20Policy.pdf

19. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

20. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

Pursuant to the provisions of the Act and the Company's Articles of Association Mr. F. N. Subedar Director retires by rotation and being eligible offers himself for re-appointment.

During the year under review Mr. H. N. Sinor and Mr. P. P. Shah ceased to be the Directors of the Company w.e.f 5th August 2019 and Mr. Zubin Dubash also ceased to be the Director of the Company w.e.f 17th March 2020. The Board of Directors places on record its appreciation of their valuable support and guidance to the Board during their tenure.

The Board of Directors on the recommendation of the Nomination and Remuneration Committee (NRC) has reappointed Mr. A. N. Dalal as an Executive Director of the Company for a term of five years with effect from 1st January 2020 upto 31st December 2024 subject to the approval of members.

During the year under review the Company appointed Mr. Abhijit Sen and Mr. Jimmy Tata as Independent Directors for a period of five consecutive years w.e.f. 4th August 2019 and the Company also appointed Mr. V. Chandrasekaran as an Independent Director for a period of five consecutive years w.e.f. 16th March 2020 subject to the approval of the Members at the ensuing AGM by way of Ordinary Resolutions.

Pursuant to the provisions of Section 149 of the Act the Independent Directors have submitted declarations that each of them meet the criteria of independence as provided in Section 149(6) of the Act along with Rules framed thereunder and Regulation 16(1)(b) of the SEBI Listing Regulations. In terms of Regulation 25(8) of SEBI Listing Regulations there has been no change in the circumstances affecting their status as Independent Directors of the Company.

During the year under review the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company other than sitting fees commission and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board/Committee of the Company. Pursuant to the provisions of Section 203 of the Act the Key Managerial Personnel of the Company as on 31st March 2020 are: Mr. Amit N Dalal Executive Director and Mr. Manoj Kumar CV Chief Financial Officer and Company Secretary.

Brief particulars and expertise of Directors seeking appointment/re-appointment together with their other directorships and committee membership have been given in the annexure to the Notice of the AGM in accordance with the requirements of the SEBI Listing Regulations and Secretarial Standards.

21. ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND OF INDIVIDUAL DIRECTORS:

Pursuant to the provisions of the Act and SEBI Listing Regulations the Board has carried out an annual evaluation of its own performance performance of the Directors individually as well as the evaluation of the working of its Committees.

The Nomination and Remuneration Committee has defined the evaluation criteria procedure and time schedule for the Performance Evaluation process for the Board its Committees and individual Directors including the Chairman of the Company. The above criteria are broadly based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on 5th January 2017.

For evaluating the Board as a whole views were sought from the Directors on various aspects of the Board's functioning such as degree of fulfilment of key responsibilities Board Structure and composition establishment delineation of responsibilities to various committees the effectiveness of Board processes information and functioning Board culture and dynamics quality of the relationship between the Board and the management.

Similarly views from the Directors were also sought on the performance of individual Directors covering various aspects such as attendance and contribution at the Board/Committee Meetings and guidance/support to the management outside Board/Committee Meetings. In addition the chairman was also evaluated on key aspects of his role including setting the strategic agenda of the Board encouraging active engagement by all Board members and promoting effective relationships and open communication communicating effectively with all stakeholders and motivating and providing guidance to the Executive Director.

Areas on which the Committees of the Board were assessed included degree of fulfilment of key responsibilities adequacy of Committee composition the effectiveness of meetings Committee dynamics and quality of the relationship of the Committee with the Board and the Management.

The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Board as a whole. The Nomination and Remuneration Committee also reviewed the performance of the Board its Committees and of the individual Directors.

22. REMUNERATION POLICY:

The Board has on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors Senior Management and their remuneration. The Appointment and Remuneration Policy is stated in the Corporate Governance Report.

23. AUDITORS:

STATUTORY AUDITORS:

M/s Kalyaniwalla & Mistry LLP Chartered Accountants (Firm Reg. No. 104607W/W-100166) were appointed as Statutory Auditors of the Company from the conclusion of the Eightieth Annual General Meeting held on 21st August 2017 till the conclusion of the Eighty-fifth Annual General Meeting to be held in the year 2022.

As per the provisions of Section 139 of the Act they have confirmed that they are not disqualified from continuing as Auditors of the Company.

The Audit Report of M/s Kalyaniwalla & Mistry LLP on the Financial Statements of the Company for the Financial Year 2019-20 is a part of the Annual Report. The Report does not contain any qualification reservation adverse remark or disclaimer.

SECRETARIAL AUDITORS:

Pursuant to provisions of Section 204 of the Act and The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company has appointed M/s. Parikh & Associates Company Secretaries to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed herewith as Annexure D. The Secretarial Audit Report for the financial year ended 31st March 2020 do not contain any qualification reservation adverse remark or disclaimer.

COST RECORDS AND COST AUDITORS:

The provisions of Cost Audit and Records as prescribed under Section 148 of the Act are not applicable to the Company.

24. SECRETARIAL STANDARDS OF ICSI:

The Company is in compliance with relevant provisions of the Secretarial Standards issued by The Institute of Company Secretaries of India and approved by the Central Government.

25. CORPORATE GOVERNANCE:

The Annual Report contains a separate section on the Company's corporate governance practices together with a certificate from the Company's Auditors confirming compliance as per SEBI Listing Regulations.

26. BUSINESS RESPONSIBILITY REPORTING:

A separate section on Business Responsibility forms part of this Annual Report as required under Regulation 34(2)(f) of SEBI Listing Regulations is annexed herewith as Annexure E

27. EXTRACT OF ANNUAL RETURN:

As per the requirements of Section 92(3) of the Act and Rules framed thereunder the extract of the annual return for FY 2019-20 is given in Annexure F in the prescribed Form No. MGT-9 which is a part of this report.

Further the extract to the Annual Return of the Company can also be accessed on the Company's website at http://www.tatainvestment.com.

28. REPORTING FRAUD :

During the year under review the Statutory Auditor and Secretarial Auditor have not reported any instances of frauds committed in the Company by its Officers or Employees to the Audit Committee under Section 143(12) of the Act details of which needs to be mentioned in this Report.

29. CONSERVATION OF ENERGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:

Being an investment company and not involved in any industrial or manufacturing activities the Company's activities involve very low energy consumption and has no particulars to report regarding conservation of energy and technology absorption. However efforts are made to further reduce energy conservation.

During the year the Company's expenditure in foreign exchange is Rs 3.81 lacs and the Company did not have any foreign exchange earnings during the year.

30. PARTICULARS OF EMPLOYEES AND REMUNERATION:

The information required under Section 197 (12) of the Act read with Rule 5(1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed as Annexure G

The information required under section 197(12) of the Act read with Rules 5 (2) and (3) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is provided in the Annexure forming part of the Report. In terms of the first proviso to Section 136 of the Act the Report and Accounts are being sent to the Shareholders excluding the aforesaid Annexure. Any Shareholder interested in obtaining the same may write to the Company Secretary at the Registered e-mail ID of the Company: ticl@tata.com. None of the employees listed in the said Annexure is related to any Director of the Company.

On behalf of the Board of Directors
NOEL N. TATA
Chairman
Mumbai May 27 2020DIN:00024713

   

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