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Tata Investment Corporation Ltd.

BSE: 501301 Sector: Financials
BSE 00:00 | 14 Feb 963.40 0






NSE 00:00 | 14 Feb 964.35 0






OPEN 956.00
52-Week high 1025.00
52-Week low 745.05
P/E 38.44
Mkt Cap.(Rs cr) 4,875
Buy Price 957.00
Buy Qty 5.00
Sell Price 963.40
Sell Qty 250.00
OPEN 956.00
CLOSE 963.40
52-Week high 1025.00
52-Week low 745.05
P/E 38.44
Mkt Cap.(Rs cr) 4,875
Buy Price 957.00
Buy Qty 5.00
Sell Price 963.40
Sell Qty 250.00

Tata Investment Corporation Ltd. (TATAINVEST) - Director Report

Company director report



The Directors present their Eighty First Annual Report with the Audited FinancialStatements for the year ended 31st March 2018.


Standalone Consolidated
Previous Year Previous Year
(Rs. in crores) (Rs. in crores) ( in crores) (Rs. in crores)
Dividend Interest & Other Income 135.26 123.56 132.83 121.96
Profit on Sale of long term Investments (net) 174.51 147.81 177.91 147.81
Total Revenue 309.77 271.37 310.74 269.77
Profit before tax 282.87 240.08 283.58 237.17
Less: Provision for tax 45.38 37.70 46.70 38.35
Profit after tax 237.49 202.38 236.88 198.82
Share of Profits of Associates - - 9.00 1.65
Minority Interest - - (0.14) (0.07)
Profit for the year 237.49 202.38 245.74 200.40
Balance brought forward from the previous year 497.11 335.21 569.50 410.20
The Directors have made the following appropriations -
Dividend on Ordinary Shares (Refer Para 3)* 99.17 - 99.17 -
Tax on Dividend (Refer Para 3)* 20.19 - 20.19 -
Statutory Reserve 47.50 40.48 48.60 41.05
166.86 40.48 167.96 41.05
Surplus as per Statement of Profit and Loss 567.74 497.11 647.31 569.50
Earnings Per Share
Basic and Diluted (`) 43.10 36.73 44.60 36.37

* Pertaining to dividend for the Financial Year 2016-17 paid in 2017-18.


The Standalone Operating Income of the Company is derived from a mix of dividend andinterest income supplemented by profit on sale of investments. The profit from sale oflong term investments for the year ended 31st March 2018 is Rs. 174.51crores as compared to Rs. 147.81 crores for the previous year. The standalone profitbefore tax for the year under review is Rs. 282.87crores as against Rs. 240.08 crores inthe previous year whereas the profit after tax for the year under review stands at Rs.237.49 crores as against Rs. 202.38 crores as on 31st March 2017. TheConsolidated profit after tax for the year amounted to Rs. 245.74 crores as compared toRs. 200.40 crores in the previous year.

Shareholders may recall that the dividend earned by the company during the financialyear (FY) 2015-16 included interim dividends received in the last quarter from itsinvestee companies which had not further proposed any final dividend at the time ofdeclaring their annual results in the FY 2016-17. Your Company in FY 2017-18 has receivedfull and final dividend declared by the investee companies in the normal courseaggregating Rs. 81.88 crores. Thus the level of dividend income earned for the currentyear is not comparable to the dividends received in the previous year. The basic anddiluted earnings per share (EPS) computed in accordance with the Accounting Standard 20 isRs. 43.10 per share as at 31st March 2018 against Rs. 36.73 per share as at 31stMarch 2017.

The total number of companies held in the equity / bond portfolio of the Company standsat 109 as on 31st March 2018 out of which 85 are Quoted and 24 are Unquotedcompanies.


The Directors are pleased to recommend a dividend of Rs. 20 per share (200%) on thepaid up capital of Rs. 55.10 crores [including a Special Dividend of Rs. 2.00 (20%)per share].


Shareholders will recall that for the first time in the Annual Report of 31stMarch 2015 the Company had shared the "Value Created" over a 15 yearperiod. The table below analyses the performance of the Company's portfolio rolling overthe period to the 15 year prior to the closing of the current financial year 31stMarch 2018. "Value Created" is a measure which evaluates the wealth created netof the capital invested by the shareholders. "Value Created" is the RealisableValue of Investments as on 31st March to which is added Net Current Assets andFixed assets while any contribution from shareholders is reduced (i.e. equity and sharepremium). The following table shows the Value Created over 15 year period and comparativereturns to the Benchmark.

Year End 31st March Realisable Value of Investments Net Current Assets Shareholder Funds (Equity + Share Premium) Value Created (A)+(B)-(C) BSE 200
(A) (B) (C)
(` crs) (Rs. crs) (Rs. crs) (Rs. crs)
2003 545.11 41.41 77.18 509.34 359
2018 10158.53 30.35 809.44 9379.44 4433
Nos of times (X) 18.41 12.34
CAGR 21.44% 18.24%

Shareholders will be pleased to note that the "Value Created" has recorded acompounded annual growth rate (CAGR) of 21.44% vis--vis the BSE 200 CAGR of 18.24% forthe 15 year period 31st March 2003 to 31st March 2018. It isheartening that this performance has been achieved while the management has endeavoured toreduce risk of the portfolio with a prudent allocation to unlisted equity and fixed incomesecurities. The Company has consistently declared dividend which over the last 15 yearshas aggregated Rs. 1153 crores. Thus if the value of dividend distributed were to beadded to Value Created the multiplier and returns of the portfolio would stand enhancedto the extent of the value distributed to the shareholders.


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

As on 31.03.2018 As on 31.03.2017
(Rs. in crores) (Rs. in crores)
Net Book value 1975.13 1993.56
Market value 8737.78 7181.38
UNQUOTED INVESTMENTS (Non-Current) - (including Mutual Funds)
Net Book value. 545.59 426.53
Estimated value (please see para below) 1420.75 1237.26
Net Book value of all investments 2520.72 2420.09
Total market value of quoted investments and estimated value of unquoted investments (subject to tax as applicable) 10158.53 8418.64
TOTAL NUMBER OF COMPANIES (excluding Mutual Funds) 109 111
Net Asset Value (NAV)
Before tax (`). 1850 1530
After tax (`) 1555 1300

The NAV is computed on the basis of the market value of quoted investments NAVs ofunquoted mutual funds most of the other equity investments in unlisted companies taken onthe basis of the last available independent valuations based on the balance sheetsavailable as at 31st March 2018 and the remaining relatively small balance ofunquoted investments taken at respective book values.

The Directors confirm that all the investments classified as non-current investments /trade investments as per the Schedule III of the Companies Act 2013 ("Act")have been made with the intent to hold for long term appreciation to enhance the incomefrom dividends and are not held for trade.

The Company continues to remain invested in leaders in sectors which we believe havepotential to remain value accretive over the long term. The Company continues to investfor the long term while availing opportunities to realize gains towards the objective ofconsistent dividend distribution.

The Company invests in Tata and Non-Tata companies both listed and unlisted thoughinvestments in Tata companies constitute a larger portion and may be considered of alonger term and strategic in nature.

The Company endeavours to evaluate opportunities considering the macro economicconditions both globally & domestically.

Global Events Markets and Risks

On December 19th 2017 the United States Senate and there after the House ofRepresentatives approved the most sweeping overhaul of the US tax system in more thanthree decades. Corporate taxes in the United States were brought down to 21% instead ofthe current rate of 35%. Further companies operating overseas such as big tech and pharmacompanies would be taxed at a low rate - 15.5% - to return cash and assets held overseasto the US in a one-time move. The impact of this reform on capital flows reversing to theUS from other markets and nations will be significant in the years to come. It is quitesafe to say that Central banks economists fixed income and equity investors are nowcontending with the prospect and the impact of the movement of large pools of capital backto the United States while preparing their thesis on future trends in the value of assetsclasses. Foreign investors have pulled out over Rs. 15500 crore from the Indiancapital market in April making it the steepest outflow in 16 months due to surge inglobal crude prices and rise in yields of government securities here. The outflow wasmatched with inflows in domestic income and equity mutual funds which had a net collectionof about `19500 crores for the month of April 2018. It is obvious that lower corporatetaxes and simplification of legal structures will attract US companies to operate withinUS shores. US will become a destination of choice of foreign MNCs. For instance Indiancompanies operating overseas which historically set up SPVs in Singapore or Hongkong willnow find USA a tax efficient and politically secure destination for incorporation.

Further the Federal Reserve has embarked on a program to increase rates steadilyfollowing a determined schedule. The Fed has signalled two more hikes in 2018. It isnoteworthy that the current rate is still substantially lower than the US Fed ratebefore the financial crisis in 2008 leaving considerable headroom for a higher rateenvironment.

The US under the leadership of its President Mr. Donald Trump has initiated what theworld fears is the beginning of a Trade War. Starting with tariffs imposed on steel andaluminium imports into the US the US has thereafter announced tariffs on at least $50billion worth of Chinese imports into USA. It is not clear how the rest of the world willreact but retaliation is certain. It is ironic that after two decades of suffering aballooning trade defficit with China the US has imposed these sanctions in a periodwhen Chinese trade surpluses have been falling for the last two years. The Chinese economyis metamorphizing from a capital investment growth economy to a consumption growth economyleading to higher domestic demand for goods. This trend resulted in lower exports fromChina for the first time in perhaps 20 years which peaked at USD 2.342 trillion in2014 fell to USD 2.273 trillion in 2015 and thereafter further to USD 2.097 trillion in2016. In the year 2017 there was a small resurgence in exports (7.9%) but was accompaniedby a steep rise in imports (15.9%). This has resulted in China earning a lowertrade surplus vis--vis the world.

Another reason for the lower trade surplus is that China in an endeavour to reducepollution has shut substantial production capacities in steel chemicals and paper. Thishas impacted China's export competitiveness in certain industries and many manufacturersin India especially in chemicals and paper have benefited substantially from thisphenomenon - a large opportunity for "Make in India".

For corporate India export potential has also received a boost from the pickup inglobal growth in 2017 and 2018—3.6 percent and 3.7 percent respectively higher inboth years than previous forecasts. Notable pickups in investment trade and industrialproduction coupled with strengthening business and consumer confidence are supportingthe recovery. Upward revisions to growth are broad based including for the Euro areaJapan China emerging Europe and Russia. The aforesaid situations a lower trade surplusof China vis-a-vis the world and higher global GDP growth offers India an opportunity todevelop its exports. The quantum of gains will depend on our ability to scale up exportsin line with the recovery in world trade. The government has endeavoured to develop theenvironment for industry and push exports on the foundation of what we commonly refer toas the "Make in India" campaign. India has recorded higher exports in FY17-18 albeit marginally with exports crossing USD 300 billion again after four years.

All countries compete in the race for higher market share of world trade. The only wayfor India to rise to the challenge of capturing higher market share in world trade is byproviding the right mix of ease of doing business and the availability of factors ofproductions at globally competitive rates. India has progressed on the World Bank's Easeof

Doing Business rankings to a rank of 100 from 142 just three years ago (2015).Needless to say that India still has a long way to go when compared to with its threeASEAN partners namely Thailand Malaysia and Indonesia.

Country Ease of Doing Business Rank Export (USD)
(in billions)
Thailand 26th 236
Malaysia 24th 175
Indonesia 72nd 168

In 2017 the World Economic Forum (WEF) ranked India as the 40th most ‘Competitiveeconomy' in South Asia in its global competitiveness ranking indicating that a lot ofwork needs to be done to improve competitiveness. To improve its standing and to boostexports India needs to have sound and efficient infrastructure to enhance competitiveness.Port development and connectivity issues need to be resolved to reduce the cost and timetaken to transport goods. On the reform front GST perhaps the largest reform of thedecade has been successfully implemented by the government. Excise and VAT Central andState Sales Tax Octroi Turnover tax Service Tax have all been subsumed in asingle tax in one stroke -the Goods & Services Tax. Further to the credit of thegovernment albeit with numerous hitches and changes the entire process of payment hasbeen made online. More than 10 million traders have registered for GST and are now workingon the online payment system every day. The collections have been below the projectionsbut this is expected to grow in FY 18-19 with greater compliance and inclusion. Thissingle indirect tax will benefit businesses in several ways namely reduce collectiontime of input tax credits savings on logistics costs and time all finally leading tohigher competitiveness.

The Financial Year 17-18 which was fairly buoyant through the year ended with the Niftyrecording an appreciation of 10.25% and the S&P BSE Midcap recording a slightly higherappreciation of 13.24%. The year unfortunately ended with considerable uncertainty cloudedby the Nirav Modi scam and other large NPA issues. The indices till the end of January hadrecorded an appreciation of 17.64%. The Reserve Bank of India in February 2018 streamlinedits rules on existing loan-restructuring mechanisms which is expected to push more debtdefaulters into bankruptcy courts. To force its point home the Reserve Bank of India(RBI) set strict timelines for lenders to take action against defaulters threateningpenalties if banks failed to act in a timely manner. The new rules while bringingdiscipline to the banking sector which will result in higher provisioning costs for thealready stretched balance sheets of Public Sector Banks. It is reported as on December2017 that there are 400 plus cases under the Insolvency and Bankruptcy Code at theNational Company Law Tribunal which may result in the lenders (the banks) to take massivehaircuts - at least 50 per cent if not more. On a positive note five major default casesunder NCLT have found firm bids and are near resolution.

Consensus earnings estimates indicates a sharp upwards acceleration in corporateearnings in FY 18-19 onwards. An improvement in corporate profitability along with thecontinued slowdown in fresh capex and borrowings will lead to a perceptible improvement incorporate balance sheets which augurs well for the future of the corporate capex cycle.

The shareholders will observe that your company has a portfolio well represented byleaders in private banks non-banking finance companies mainly housing consumer facingcompanies infrastructure and engineering automobiles and pharmaceuticals. We remaininvested in high quality companies which will record competitive revenue and earningsgrowth. In the year to come your company will continue to identify opportunities in selectsectors which the management believes have potential to grow your wealth.

To summarize the Indian economy and companies are perhaps on the cusp of a higherearnings trajectory. Valuations remain rich which may lead to lower appreciation than whatthe market has rewarded shareholders in the last few years. We will continue to look foropportunities both in the listed and unlisted space.

6. Impact of Ind AS on the Financial Statement from Financial Year 2018-19 :

The Ministry of Corporate Affairs in its press release dated January 18 2016 hadissued a roadmap for implementation of Indian Accounting Standards (Ind AS) forNon-Banking Financial Companies (NBFC). This roadmap required NBFCs to prepare Ind ASbased financial statements for the accounting periods beginning from April 1 2018 onwardswith comparatives for the periods beginning April 1 2017 and thereafter.

The implementation of Ind AS is expected to result in significant changes to the waythe Company prepares and presents its financial statements. The areas that are expected tohave significant accounting impact on the application of Ind AS based on the Ind ASmandatory exceptions and the optional exemptions elected by the Company are summarisedbelow:

1) Equity Investments in both quoted and unquoted securities would be Fair ValuedThrough Other Comprehensive Income (a component of Reserves and Surplus) except in case ofinvestments in subsidiary and associates where the Company would retain its investments atcost.

2) Fixed Income securities based on the nature of the cash flows and the intention ofholding the financial assets would be Fair Valued Through Other Comprehensive Income(Recyclable to the Statement of Profit and Loss).

3) Mutual funds and Venture Capital funds would be measured at Fair Value with allchanges recognised in the Statement of Profit and Loss.

4) Interest income will be recognised in the income statement using the effectiveinterest method whereby the coupon fees net of transaction costs and all other premiumsor discounts will be amortised over the life of the financial instrument.

Upon transition to Ind AS the operating income will be the aggregate of dividendincome Interest income on effective interest method gains/losses on sale of fixed incomesecurities & mutual funds and other operating income. The gains/ losses arising fromsale of equity investments would be reffected in Other Comprehensive Income instead ofStatement of Profit and Loss. Thereafter the realised gains/losses on sale of the equityinvestment would be reclassified to retained earnings from the Other Comprehensive Incomewhich could lead to a significant reduction in the operating income on Quarterly/Yearlybasis on adoption of Ind AS.


The Company has not accepted any public deposits under the provisions of the Act.


The provisions of Section 186 of the Act pertaining to investment and lendingactivities are not applicable to the Company since the Company is an NBFC whose principalbusiness is acquisitions of securities. During the year the Company has not provided anyguarantee.


The Consolidated Financial Statements of the Company prepared in accordance withAccounting Standard 21 issued by the Institute of Chartered Accountants of India formpart of the Annual Report.

The annual accounts of the subsidiary company and related detailed information areavailable on the website of the Company and are kept at the Registered Office of theCompany and its subsidiary company and will be available to investors seeking informationat any time.

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

The Company has adopted a Policy for determining material Subsidiaries in terms ofRegulation 16 (1) (c) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 ("Listing Regulations"). The Policy as approved by the Boardis uploaded on the Company's website.

Subsidiary Company

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

Simto has an Issued Capital of Rs. 1.53 crores with a net worth of Rs. 30.30 crores ason 31st March 2018. The market value of investments held by Simto is valued at Rs. 63.52crores as on 31st March 2018.

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 thecompany is registered with Securities Exchange Board of India ("SEBI") under theSEBI (Mutual Fund) Regulations 1996. The consolidated turnover of the company during theyear was Rs. 218.19 crores and Profit after tax for the year was Rs. 40.35 crores. Thecompany has a net worth of Rs. 235.66 crores as on 31st March 2018.

2. Tata Trustee Company Ltd.

The Company holds 50% of the equity share capital of Tata Trustee Company Ltd which isacting as the Trustees to Tata Mutual Fund. During the year the turnover of the companywas Rs. 7.02 crores and Profit after tax for the year was Rs. 3.72 crores. The Company hasa net worth of `15.79 crores as on 31st March 2018.

3. Amalgamated Plantations Private Ltd.

The Company holds 24.61% of the equity share capital of Amalgamated Plantations PrivateLtd ("APPL") which is engaged in the business of cultivation and manufacturingof tea and other allied agricultural products and packaging services. The turnover of APPLduring the year was Rs. 678.18 crores and registered a loss of Rs. 20.10 crores during thefinancial year 2017-18.

A statement containing the salient features of the financial statements of thesubsidiary company and associate companies is annexed to the Financial Statements in FormAOC-1 "Annexure A".


During the year five Board Meetings and four Audit Committee Meetings were held. Thedetails of the composition of the Board and its Committees and of the Meetings held andattendance of the Directors at such Meetings are provided in the Corporate GovernanceReport. The Board has constituted an Audit Committee under the Chairmanship of Mr.H. N. Sinor the other members of the Committee being Mr. A.B.K. Dubash Mr. P. P. Shahand Mr. F. N. Subedar. There have not been any instances during the year whenrecommendations of the Audit Committee were not accepted by the Board.


Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company work performed by the internal statutory andsecretarial auditors including audit of internal financial controls over financialreporting by the statutory auditors and the reviews performed by Management and therelevant Board Committees including the Audit Committee the Board is of the opinion thatthe Company's internal financial controls were adequate and effective during the financialyear 2017-18.

Accordingly pursuant to Section 134(3)(c) and 134(5) of the Companies Act 2013 theBoard of Directors to the best of their knowledge and ability confirm that: – i) inthe preparation of the annual accounts the applicable accounting standards have beenfollowed and that there are no material departures; ii) they have selected such accountingpolicies and applied them consistently and made judgments and estimates that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany 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 accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities; iv) they haveprepared the annual accounts on a going concern basis; v) they have laid down internalfinancial controls to be followed by the Company and that such internal financial controlsare adequate and are operating effectively; vi) they have devised proper systems to ensurecompliance with the provisions of all applicable laws and that such systems are adequateand operating effectively.


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

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


The Company maintains appropriate systems of internal controls including monitoringprocedures to ensure that all assets and investments are safeguarded against loss fromunauthorized use or disposition. Company policies guidelines and procedures provide foradequate checks and balances and are meant to ensure that all transactions are authorizedrecorded and reported correctly.

The Internal Auditors reviews the efficiency and effectiveness of these systems andprocedures. Added objectives include evaluating the reliability of financial andoperational information and ensuring compliances with applicable laws and regulations. TheInternal Auditors submit their Report periodically which is placed before and reviewed bythe Audit Committee.


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


All Related Party Transactions that were entered into during the financial year were onan arm's length basis in the ordinary course of business and were in compliance with theapplicable provisions of the Act and the Listing Regulations. There were no materiallysignificant Related Party Transactions made by the Company with Promoters Directors KeyManagerial Personnel which may have a potential con_ict with the interest of theCompany 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 arerepetitive in nature. A statement of all Related Party Transactions is placed before theAudit Committee for its review on a quarterly basis specifying the nature value andterms and conditions of the transactions if any.

The Company has adopted a Related Party Transactions Policy. The Policy as approved bythe Board is uploaded on the Company's website at the web link: There are no transactions tobe reported in form AOC-2.

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


In terms of Section 135 of the Act the Board of Directors has constituted a CSRCommittee under the Chairmanship of Mr. F N. Subedar. Mr. A.B.K. Dubash and Mr. A. N.Dalal are the other members of the Committee.

The CSR Committee of the Board has framed a CSR Policy and uploaded it on the websiteof the Company .

The Annual Report on CSR activities is annexed herewith as "Annexure B". 20


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

The Company has not received any complaint of sexual harassment during the financialyear 2017-2018.


In terms of Regulations 43A of Listing Regulations the Board of Directors of theCompany has adopted a Dividend Distribution Policy which is annexed herewith as"Annexure-C". The Policy is also available on the website of the Company.


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


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 forre-appointment.

All Independent Directors have given declarations that they meet the criteria ofIndependence as laid down under Section 149(6) of the Act and the Listing Regulations.

Mr. K. A. Chaukar retired as a Director from the Board of Directors with effect from2nd August 2017 on completion of 70 years of age and the Board of Directors place onrecord its sincere appreciation of his valuable support and guidance to the Board duringhis tenure.

The Members at the 78th Annual General Meeting (AGM) of the Company had approved theappointment of Ms. Vedika Bhandarkar as Independent Director of the Company for a periodof three years with effect from 24th March 2015. Upon the conclusion of her first term asan Independent Director and on the basis of the recommendation of the Nomination andRemuneration Committee Ms. Vedika Bhandarkar has been appointed by the Board asAdditional Director of the Company with effect from 24th March 2018. Ms. VedikaBhandarkar has also been re-appointed as Independent Director of the Company for a secondterm with effect from 24th March 2018 to 23rd March 2023 subject to the Members'approval at the ensuing AGM. She is not liable to retire by rotation. As AdditionalDirector she holds office as Director upto the date of the ensuing AGM and is eligible tobe appointed as Director. Notice has been received from a Member pursuant to Section 160of the Act signifying the intention to propose Ms. Vedika Bhandarkar for appointment asDirector of the Company.

There were no changes in the Key Managerial Personnel of the Company during thefinancial year 2017-18.


Pursuant to the provisions of the Act and Listing Regulations the Board has carriedout an annual evaluation of its own performance performance of the Directors individuallyas well as the evaluation of the working of its Committees. The Nomination andRemuneration Committee has defined the evaluation criteria procedure and time schedulefor the Performance Evaluation process for the Board its Committees and individualDirectors including the Chairman of the Company.

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

Similarly views from the Directors were also sought on performance of individualDirectors covering various aspects such as attendance and contribution at theBoard/Committee Meetings and guidance/support to the management outside Board/CommitteeMeetings. In addition the Chairman was also evaluated on key aspects of his roleincluding setting the strategic agenda of the Board encouraging active engagement by allBoard members and promoting effective relationships and open communication communicatingeffectively with all stakeholders and motivating and providing guidance to the ExecutiveDirector.

Areas on which the Committees of the Board were assessed included degree of fulfilmentof key responsibilities adequacy of Committee composition effectiveness of meetingsCommittee dynamics and quality of relationship of the Committee with the Board and theManagement.

The performance evaluation of the Independent Directors was carried out by the entireBoard. The performance evaluation of the Chairman and the Non-Independent Directors wascarried out by the Independent Directors who also reviewed the performance of the Board asa whole. The Nomination and Remuneration Committee also reviewed the performance of theBoard its Committees and of individual Directors.

The Chairman of the Board provided feedback to the Directors as appropriate.Significant highlights learning with respect to the evaluation were discussed at theBoard Meeting.


The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The Remuneration Policy is stated in the Corporate Governance Report.



At the Annual General Meeting of the Company held last year pursuant to the provisionsof the Act and the Rules made thereunder M/s Kalyaniwalla & Mistry LLP CharteredAccountants (Firm Reg. No. 104607W/W-100166) were appointed as Statutory Auditors of theCompany from the conclusion of the Eightieth Annual General Meeting held on 21st August2017 till the conclusion of the Eighty-fifth Annual General Meeting to be held in the year2022 subject to ratification of their appointment at every Annual General Meeting if sorequired under the Act. As the requirement of ratification of appointment of auditors atevery AGM is no longer required under the Act resolution for the same is not included inthe Notice. M/s Kalyaniwalla & Mistry LLP have submitted a certificate confirming thattheir appointment will be in accordance with Section 139 read with Section 141 of the Act.

The Audit Report of M/s Kalyaniwalla & Mistry LLP on the Financial Statements ofthe Company for the Financial Year 2017-18 is a part of the Annual Report.


Pursuant to provisions of Section 204 of the Act and The Companies (Appointment andRemuneration 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 Statutory Auditor's Report and the Secretarial Audit Report for the financial yearended 31st March 2018 do not contain any qualification reservation adverse remark ordisclaimer.


The Company is in compliance with the relevant provisions of Secretarial Standards onMeetings of the Board of Directors (SS-1) and General Meetings (SS-2) issued by theInstitute of Company Secretaries of India and approved by the Central Government.


The Annual Report contains a separate section on the Company's corporate governancepractices together with a certificate from the Company's Auditors confirming complianceas per Listing Regulations.


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


The details forming part of the extract of the Annual Return in the form MGT-9 isannexed herewith as "Annexure F".


Being an investment company and not involved in any industrial or manufacturingactivities the Company's activities involve very low energy consumption and has noparticulars to report regarding conservation of energy and technology absorption. Howevere_orts are made to further reduce energy conservation.

During the year the Company's expenditure in foreign exchange is Rs. 3.34 lacs asmentioned in Note 8 to the Annual Report and the Company did not have any foreign exchangeearnings during the year.


The information required under Section 197 (12) of the Act read with Rule 5(1) of TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexedas "Annexure G" forming part of the Report.

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 isprovided in the Annexure forming part of the Report. In terms of the first proviso toSection 136 of the Act the Report and Accounts are being sent to the Shareholdersexcluding the aforesaid Annexure. Any Shareholder interested in obtaining the same maywrite to the Company Secretary at the Registered Office of the Company. None of theemployees listed in the said Annexure is related to any Director of the Company.

On behalf of the Board of Directors



Mumbai 7th May 2018