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Team Lease Services Ltd.

BSE: 539658 Sector: Others
NSE: TEAMLEASE ISIN Code: INE985S01024
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OPEN 3539.00
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VOLUME 560
52-Week high 3840.00
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P/E 184.92
Mkt Cap.(Rs cr) 5,863
Buy Price 3379.00
Buy Qty 1.00
Sell Price 3428.45
Sell Qty 16.00
OPEN 3539.00
CLOSE 3476.30
VOLUME 560
52-Week high 3840.00
52-Week low 1421.35
P/E 184.92
Mkt Cap.(Rs cr) 5,863
Buy Price 3379.00
Buy Qty 1.00
Sell Price 3428.45
Sell Qty 16.00

Team Lease Services Ltd. (TEAMLEASE) - Director Report

Company director report

Dear Shareholders

Your Directors have the pleasure in presenting the Twentieth (20th) AnnualReport of your Company (TeamLease Services Limited/TeamLease) on business and operationsof the Company along with the Audited Standalone and Consolidated Financial Statements andthe Auditor's Report for the year ended March 31 2020. Consolidated performances of theCompany its subsidiaries and associate companies have been referred to wherever required.

1. Corporate Overview

The Company was incorporated in 2000 and has thereafter transformed to being one of theleading human resource service companies in the organized segment. A Fortune India 500Company listed on BSE Limited and National Stock Exchange of India Limited since 2016 hasits corporate headquarters at Bangalore.

2. Financial Summary and Highlights

A summary of the Company's financial results for the Financial Year 2019-20 is asunder:

Consolidated Standalone
Particulars
2019-20 2018-19 2019-20 2018-19
Revenue from Operations 520072.26 444759.95 478337.68 413246.85
Other Income 3084.28 1806.20 4365.17 2946.11
Total Income 523156.54 446566.15 482702.85 416192.96
Profit before finance cost depreciation 12593.77 11251.12 11843.61 10247.12
amortisation and taxes
Depreciation and Amortisation 2858.92 1051.11 1473.16 303.93
Profit before Finance Cost and Taxes 9734.85 10200.01 10370.45 9943.19
Finance Cost 1288.89 522.44 868.79 206.67
Profit before share of profit/(loss) from associates 8505.96 9677.57 9501.66 9736.52
Share of (loss)/ profit from associates (208.56) (36.44) NA NA
Profit before tax 8297.40 9641.13 9501.66 9736.52
Income Tax (credit)/expense 4799.87 (161.86) 5343.46 34.57
Net Profit for the year 3497.53 9802.99 4158.20 9701.95
Other Comprehensive Income/(Loss) for the year 28.96 23.34 28.47 6.45
Total Comprehensive Income for the year 3526.49 9826.33 4186.67 9708.40
Earnings Per Equity Share of H10 each:
-Basic & Diluted (in H) 20.46 57.34 24.32 56.75

3. Standalone and Consolidated Financial Statements

As mandated by the Ministry of Corporate Affairs the Financial Statements for the yearended March 31 2020 has been prepared in accordance with the Indian Accounting Standards(Ind AS) notified under Section 133 of the Companies Act 2013 (hereinafter referred to as"The Act") read with the Companies (Accounts) Rules 2014 as amended from timeto time. The estimates and judgements relating to the Financial Statements are made on aprudent basis so as to reflect in a true and fair manner the form and substance oftransactions and reasonably present the Company's state of affairs profits and cash flowsfor the year ended March 31 2020. The Notes to the Financial Statements adequately coverthe standalone and consolidated Audited Statements and form an integral part of thisReport.

4. Review of Business Operations and Future Prospects / State of Affairs

Your Directors wish to present the details of Business Operations done during the yearunder review:

Standalone Operations

The Company's Revenue from Operations for the year ended March 31 2020 on a StandaloneBasis increased to Rs 478337.68 Lakhs from Rs 413246.85 Lakhs during the previousyear. The Company achieved an EBIDTA (including other income) of Rs 11843.61 Lakhs duringthe current year as against the previous year EBIDTA (including other income) of Rs10247.12 Lakhs. The net profit after tax of the Company for the year ended March 31 2020was Rs 4158.20 Lakhs as against the previous year profit after tax of Rs 9701.95 Lakhs.

Consolidated Operations

The Company's Revenue from Operations for the year ended March 31 2020 on aConsolidated Basis increased to Rs 520072.26 Lakhs from Rs 444759.95 Lakhs during theprevious year. The Company achieved an EBIDTA (including other income) of Rs 12385.21Lakhs during the current year as against the previous year EBIDTA (including other income)of Rs 11214.68 Lakhs. The net profit after tax of the Company for the year ended March31 2020 was Rs 3497.53 Lakhs as against the previous year profit after tax of Rs9802.99 Lakhs.

Number of Associate Employees as on the date of close of Financial Year of the Companywas ~211985 (including the NETAP Trainees of 50620) as against the previous yearAssociate employees of ~216200 (including the NETAP Trainees of ~56150).

Your Directors express their satisfaction on the overall financial performance and theprogress made on different areas by the Company during the year under review.

From a business continuity purpose and in preparation for the future cash flowavailability and costs are key focus areas under the present circumstances. The Company isclosely watching market conditions as the lockdown unfolds and evaluating all projects inpipeline and will pace them in line with market conditions. The revised timelines for thedevelopment plan will need to be reassessed as the situation unfolds.

The Management based on its assessment of the situation has internally revised itsbusiness forecasts for the near term and assessed the cash flow required. The cash onbooks the sanctioned lines of credit and the operating cash flows as per the forecastappear to be reasonably adequate to meet the debt servicing obligations and minimalcapital spends in respect of the development pipeline for the year.

A comprehensive renegotiation exercise is under way with our vendors and serviceproviders; initial outcome of these discussions has been favorable.

The Company has the policy on the employment diversity which states the equalopportunity to everyone without any discrimination of gender region caste or religion.

5. Global Pandemic-COVID-19

The outbreak of Coronavirus (COVID-19) pandemic globally and in India is causingsignificant disturbance and slowdown of economic activity. In many countries businessesare being forced to cease or limit their operations for long or indefinite periods oftime. Measures taken to contain the spread of the virus including travel bansquarantines social distancing and closures of non-essential services have triggeredsignificant disruptions to businesses worldwide resulting in an economic slowdown.COVID-19 is significantly impacting business operation of the companies by way ofinterruption in supply chain disruption unavailability of personnel closure / lockdownof facilities etc. On March 24 2020 the Government of India ordered a nationwidelockdown for 21 days which further got extended till May 03 2020 to prevent communityspread of COVID-19 in India resulting in significant reduction in economic activities.

In the last month of FY 2020 the COVID-19 pandemic developed rapidly into a globalcrisis forcing governments to enforce lock-downs of all economic activity. For theCompany the focus immediately shifted to ensuring the health and well-being of allemployees and on minimizing disruption to services for all our customers. From a highlycentralized model consisting of work spaces set in physical locations capable ofaccommodating thousands of employees the switch to work from home for employees all overextending all the elements of the Company's working model was carried out seamlessly. Asof March 31 2020 work from home was enabled to close to 90 percent of the employees towork remotely and securely. This response has reinforced customer confidence in TeamLeaseand many of them have expressed their appreciation and gratitude for keeping theirbusinesses running under most challenging conditions. TeamLease's working model ensureshigh quality and delivery certainty that the customers expect while addressing the issuesaround project management practices and systems.

Although there are uncertainties due to the pandemic and reversal of the positivemomentum gained in the last quarter of FY 2020 the strong inherent resilience of thebusiness model position the Company in a positive place to navigate the challenges aheadand gain market. As on date of signing of this Annual Report the Company has beenparticipating in various engagements with the policy makers to recommend mitigationpolicies. Similarly the Company is closely engaging with its operating partners andstakeholders to assess the consequent impact and recalibrate the manner in which businessis conducted going forward. With the lifting of the lockdown restrictions the Companyhas started re-opening its office spaces in the non-containment zones afterestablishing thorough and well-rehearsed safety protocols. The Company is taking utmostcare of its staff and work place like sanitization social distancing mandatory maskwearing thermal check at the gate maintaining proper hygiene and overhead controlmeasures to smoothly manage our operations. With a clear focus on a road map for recoverythe business processes and arrangements are being suitably realigned that includes anincreased focus on health and safety of our employees partners stakeholders andassociates. During this period of lockdown the Company has taken various steps towardsrethinking the ‘new normal' for the business and gearing our offerings for the postCOVID-19 lockdown world.

6. Dividend Distribution Policy

As per the provisions of Regulation 43A of SEBI LODR Regulations 2015 the top 500listed companies on the basis of market capitalization shall formulate a DividendDistribution Policy. Accordingly the Dividend Distribution Policy was adopted to set outthe parameters and circumstances that will be taken into account by the Board indetermining the distribution of dividend to its Shareholders and/or retaining profitsearned by the Company. The Policy is furnished herewith as Annexure I to theBoard's Report and is also available on the Company's website athttps://www.teamleasegroup.com/policy-documents.

7. Dividend and Reserves

Your Directors would like to use the profits earned for purpose of enhancing businessand hence do not propose any dividend for the Financial Year under review. No amount hasbeen transferred to reserves and the profit for the year has been retained in the surplusforming part of the reserves of the Company.

8. Transfer of Unclaimed Dividend to Investor Education and Protection Fund

There were no unpaid/unclaimed dividends declared and paid in previous years and hencethe provisions of Section 125 of the Companies Act 2013 do not apply for the year underreview.

9. Subsidiaries Joint Ventures and Associate Companies

Your Company has formulated a Policy for determining ‘Material Subsidiaries'pursuant to the provisions of Regulation 16 of SEBI LODR Regulations 2015. The saidPolicy is available on the Company's website https://www.teamleasegroup.com/policy-documents.

The Company has seven direct and indirect subsidiaries one Joint Venture oneAssociate Company and one Public-Private Partnership as on March 31 2020. There are nomaterial subsidiaries of the Company for the Financial Year 2019-20.

The details of Subsidiaries Joint ventures Associates and Public-Private Partnershipare given below.

Subsidiaries:

1. IIJT Education Private Limited (IIJT)

2. TeamLease Education Foundation (TLEF)

3. TeamLease Digital Private Limited (TDPL)

4. Keystone Business Solutions Private Limited (Keystone)

5. Evolve Technologies & Services Private Limited (Evolve)

6. TeamLease E-Hire Private Limited (Formerly known as Cassius Technologies PrivateLimited (Freshersworld)

7. I.M.S.I Staffing Private Limited (IMSI)

Joint Venture

1. Avantis Regtech Private Limited (Avantis)

Associates

1. School Guru Eduserve Private Limited (Schoolguru)

Public-Private Partnership

1. TeamLease Skills University (TLSU)

1. IIJT Education Private Limited (IIJT) is a wholly-owned subsidiary of theCompany. During the year under review the Company has generated revenue by leasing outits property.

2. TeamLease Education Foundation (TLEF) is a Section 8 Company (originallyregistered under Section 25 of the Companies Act 1956). TLEF is a wholly-owned subsidiaryof the Company. TLEF is the sponsor of TeamLease Skills University ("TLSU") thecountry's first Skills University established under the provisions of the Gujarat PrivateUniversities Act 2009.

Your Company plans to extend financial support to TLEF till the operations of TLEFstabilize. The loan advanced to this wholly-owned subsidiary is at arm's length and willbe charged with the appropriate rate of interest. TLEF has in-turn advanced monies toTLSU and the same is interest bearing.

TLEF is a National Employability Enhancement Mission (‘NEEM') Agent as approved bythe All India Council for Technical Education (AICTE). NEEM is an employability initiativeof the Ministry of Human Resource Development Government of India. TLEF hasoperationalized the NEEM initiative as National Employability through ApprenticeshipProgramme (NETAP) through TLSU.

3. TeamLease Digital Private Limited (TDPL) was incorporated underthe provisions of Companies Act 2013 for the purpose of entering into the IT staffingbusiness. TDPL is wholly-owned subsidiary of your Company.

TeamLease had through its subsidiary TDPL acquired the IT Staffing vertical ofE-Centric Solutions Private Limited by way of business transfer/ slump sale arrangement.E- Centric Solutions Private Limited is a Hyderabad-based HR Services Company. The ITStaffing vertical operating since 2014 currently has over 254 core employees 2680associates deployed across 87 clients with a turnover of over of Rs 19533.94 Lakhs.

4. Keystone Business Solutions Private Limited (Keystone) is engaged in thebusiness of providing information technology staffing solutions and consulting. Keystoneis a step down wholly-owned subsidiary of the Company through TDPL.

5. Evolve Technologies & Services Private Limited (Evolve) is a stepdown wholly-owned subsidiary of Company through TDPL w.e.f. October 31 2017. Evolve isengaged in the business of staffing (predominantly temporary staffing) to clients inTelecom and IT sector.

6. TeamLease E-Hire Private Limited (Formerly known as Cassius TechnologiesPrivate Limited) (Freshersworld) was an Associate Company w.e.f. June 01 2017 with aninvestment of 30% stake in Freshersworld. Your Company further acquired additional 21%stake and pursuant to such an investment Freshersworld became subsidiary Company w.e.f.July 31 2018. Your Company further acquired additional 25% stake on July 04 2019bringing the total investment to 76% as on March 31 2020. The Bangalore headquarteredFreshersworld (www.freshersworld.com) is the leading job site for entry level hiring inIndia with about 4 million unique visits every month. It has a database of 1 crore+resumes with over 2 lakh resumes added every month. Freshersworld dominates itscompetitors in fresher hiring segment with an organic traffic of over 90% and is rankedamong the Top 5 hiring portals in India in terms of traffic (per Alexa). It has over61000 registered employers/ recruiters with 5000 subscribed customers and conducts 8-9virtual recruitment drives every month. Freshersworld is one of the very few onlineportals with positive margins and operating cashflows.

7. I.M.S.I Staffing Private Limited (IMSI) was acquired by your Company onNovember 12 2019 with an investment of 72.70% stake in equity and additional 21.24% stakewas acquired by your Company on February 03 2020 bringing the total investment to 93.94%as on March 31 2020. IMSI is an IT Infra staffing company having its Registered Office atDehradun. IMSI is a leader in providing specialized technical manpower for managing ITInfrastructure projects hardware platforms OS platforms developing and maintainingenterprise software applications networking data management and storage andinternet-web-mobile-cloud platforms. IMSI has over 1838 associates deployed on 50+ panIndia projects with revenue of Rs 2054.18 Lakhs and PBT of Rs 241.09 Lakhs for the postacquisition period. IMSI is one of the largest manpower outsourcing partners in IT Infraspace in India. Over the past 20 years they have built strong customer relationship andbrand recall supported by reliable and efficient delivery engine.

8. Avantis Regtech Private Limited (Avantis) is a Joint Venture of yourCompany w.e.f. November 01 2018. Established in October 12 2018 Avantis is a B2BRegTech (Regulatory Technology) Company in India currently with 104 Enterprise customersserving over 5500+locations across 29 states and 7 union territories in India across 30+different industries with State of the art cloud enabled SAAS (Software as a Service)Platform equipped with enterprise workflow and document management capabilities.

9. School Guru Eduserve Private Limited (Schoolguru) is an Associate Companyw.e.f. December 01 2017. Established in 2012 it is India's premier technology-ledspecialized academic services organization. Schoolguru partners with Indian Universitiesto help them provide premium online and virtual courses for their students. Schoolgurusolicits partnerships only from State / Central universities that are either an OpenUniversity (meant to run Distance Education Programs only) or have a significant DistanceEducation activity. Their managed technology platform provides all the components that aUniversity may need to run their Information and Communication Technology services fortheir students ranging from the hosting platform the underlying ERP admission and feemanagement the content the streaming services student engagement and communicationstudent servicing and the expertise to manage the platform. The platform is mobile nativeand is designed to adopt innovations in machine learning multi-reality and analytics tooffer personalized and effective learning to millions.

10. TeamLease Skills University (TLSU) a Public-Private Partnership with theGovernment of Gujarat was among the few Universities selected by the United KingdomEducation Research Initiative (UKERI). In terms of the said initiative the University hasreceived grants that are to be utilized for faculty development.

Pursuant to first proviso to sub-section (3) of section 129 of the Companies Act 2013read with Rule 5 of the Companies (Accounts) Rules 2014 a Report on the performance andfinancial position of the subsidiary companies as per the Companies Act 2013 in the FormAOC-1 is furnished as Annexure II to the Board's Report.

10. Management Discussion and Analysis (MD&A) Report

Pursuant to the provisions of Regulation 34 of the SEBI LODR Regulations 2015 theManagement Discussion and Analysis capturing your Company's performance industry trendsand other material changes with respect to your Companies and its subsidiaries whereverapplicable are set out from pages 162 to 172 in this Annual Report.

The MD&A Report provides a consolidated perspective of economic social andenvironmental aspects material to your Company's strategy and its ability to create andsustain value to your Company's key stakeholders and includes aspects of reporting asrequired by Regulation 34 of the SEBI LODR Regulations 2015 on Business Responsibility(BR) Report. Statutory section of Business Responsibility (BR) Report is provided from pages151 to 161 to this Annual Report.

11. Corporate Governance

Your Company is committed to maintain the highest standards of corporate governance. Webelieve sound corporate governance is critical to enhance and retain investor trust. Ourdisclosures seek to attain the best practices in corporate governance as prevalentglobally. We have implemented several best corporate governance practices in the Companyto enhance long-term shareholder value and respect minority rights in all our businessdecisions. Corporate Governance Report for Financial Year 2019-20 is set out in pages114 to 150 of this Annual Report. The requisite certificate from the SecretarialAuditors of the Company confirming compliance with the conditions of corporate governanceas stipulated under Regulation 34 (3) read with Schedule V of the SEBI LODR Regulations2015 is annexed to the Corporate Governance Report.

12. Deposits

Your Company has not accepted any deposit and as such no amount of principal andinterest were outstanding as on the Balance Sheet date.

13. Particulars of Loans Guarantees or Investments

Details of loans guarantees and investments covered under the provisions of Section186 of the Companies Act 2013 are furnished in the notes to the Financial Statementsforming part of this Annual Report.

14. Board of Directors Committees of the Board and Key Managerial Personnel(s)(KMP(s))

a. Board of Directors

Your Company's Board of Directors comprises of two Executive Directors fourIndependent Directors including one Woman Director and the same is detailed in the Reporton Corporate Governance as set out in pages 114 to 150 of this Annual Report.

b. Committees of the Board

As required under the Companies Act 2013 and SEBI LODR Regulations 2015 the Boardhas formed five Committees viz.

• Audit Committee

• Corporate Social Responsibility Committee

• Nomination and Remuneration Committee

• Risk Management Committee and

• Stakeholders' Relationship Committee

Keeping in view the requirements of the Companies Act 2013 and SEBI LODR Regulations2015 the Board decides the terms of reference of these Committees and the assignment ofmembers to various Committees. The recommendations if any of these Committees aresubmitted to the Board for approval.

Pursuant to Section 177(8) of the Companies Act 2013 the composition of the AuditCommittee is disclosed as under:

Members Designation
1 Mrs. Latika Pradhan Chairperson
(Independent Director)
2 Mr. Narayan Member
Ramachandran (Independent Director)
3 Mr. V. Raghunathan Member
(Independent Director)

The recommendations of the Audit Committee were duly approved and accepted by the Boardduring the year under review.

The details of all the Committees along with their composition number of meetings andattendance at the meeting as set out in Report on Corporate Governance as set out in pages114 to 150 of this Annual Report.

c. Key Managerial Personnel(s) (KMP(s))

Pursuant to the provisions of Section 203 of the Companies Act 2013 the KeyManagerial Personnel(s) (KMP(s)) of the Company are:

Name of the KMP(s) Position held in the Company
1 Mr. Ashok Reddy Managing Director
2 Mr. N Ravi Vishwanath Chief Financial Officer
3 Mrs. Alaka Chanda Company Secretary and Compliance Officer

d. Details of Directors and/or Key Managerial Personnel(s) (KMP(s)) who were appointedor have resigned during the year:

a. Retirement by rotation

In accordance with the provisions of Section 152 (6) of the Companies Act 2013 and interms of the Articles of Association of the Company Mr. Ashok Reddy (DIN: 00151814)Managing Director of the Company retires by rotation at the forthcoming AGM and beingeligible offers himself for re-appointment. The details of Mr. Ashok Reddy arefurnished in the Notice of the AGM. The Board recommends his re-appointment for theconsideration of the Members of the Company at the forthcoming AGM.

b. Changes during the year under review:

i. The Members at the Nineteenth (19th) AGM of the Company held on August23 2019 had re-appointed Mr. Manish Mahendra Sabharwal (DIN: 00969601) Chairman of the

Company in accordance with the provisions of Section 152 (6) of the Companies Act 2013and in terms of the Articles of Association of the Company who had retired by rotationand being eligible had offered for reappointment.

ii. The Members at the Nineteenth (19th) Annual General Meeting (AGM) of theCompany held on August 23 2019 had appointed Mr. Zarir Batliwala as an IndependentDirector of the Company.

We thank the Members for their support in confirming the above mentioned appointmentand re-appointment.

c. Recommendation by the Board for re-appointment at the ensuing AGM:

i. Independent Directors:

The current term of appointment of Mrs. Latika Pradhan Mr. Narayan Ramachandranand Mr. V. Raghunathan Independent Directors of the Company is due to expire on July 082020. Based on the outcome of the Performance Evaluation the Nomination and RemunerationCommittee vide its' meeting dated June 09 2020 has recommended to continue the term ofappointment of the Independent Directors and nominated to the Board re-appointment ofMrs. Latika Pradhan Mr. Narayan Ramachandran and Mr. V. Raghunathan as IndependentDirectors for an additional term of five consecutive years. A brief profile of Mrs.Latika Pradhan Mr. Narayan Ramachandran and Mr. V. Raghunathan is given in the Notice ofAGM dated June 09 2020. The Company has received declarations from all the IndependentDirectors confirming that they meet the criteria of independence as prescribed undersub-section (6) of Section 149 of the Companies Act 2013 and Regulation 25 of SEBI LODRRegulations 2015. The Company has also received requisite notices in writing from Memberssignifying the candidatures of Mrs. Latika Pradhan Mr. Narayan Ramachandran and Mr.V. Raghunathan as Independent Directors of the Company.

The Board recommends the re- appointment of Mrs. Latika Pradhan Mr. NarayanRamachandran and Mr. V. Raghunathan as Independent Directors.

ii. Executive Directors:

ThecurrenttermofappointmentofMr.Manish Mahendra Sabharwal and Mr. Ashok Reddy as theChairman and Managing Director respectively of the Company is due to expire on August 312020. The Nomination and Remuneration Committee vide its' meeting dated June 09 2020 hasrecommended to continue the term of appointment of Mr. Manish Mahendra Sabharwaland Mr. Ashok Reddy as the Chairman and Managing Director respectively and nominated tothe Board re-appointment of Mr. Manish Mahendra Sabharwal as the Chairman till March 312022 and Mr. Ashok Reddy Managing Director for an additional term of five consecutiveyears. A brief profile of Mr. Manish Mahendra Sabharwal and Mr. Ashok Reddy isgiven in the Notice of AGM dated June 09 2020.

The Board recommends the re-appointment of Mr. Manish Mahendra Sabharwal and Mr. AshokReddy as the Chairman and Managing Director respectively for the period mentioned above.

Key Managerial Personnel(s) (KMP(s)):

During the year under review Key NIL
Managerial Personnel(s) (KMP(s))
who have tendered their resignation
During the year under review Key NIL
Managerial Personnel(s) (KMP(s))
who have been appointed

e. Receipt of any commission by MD / WTD from Company or from its holding or subsidiaryCompany

The Company has not paid any commission to any of its Directors. The Managing Director& Whole Time Director draw remuneration only from the Company _nd do not receive anyremuneration or commission from any of its subsidiary companies / holding company.Further none of the subsidiaries of the Company has paid any commission/remuneration toany of the Directors of the Company.

15. Declaration by Independent Directors

All Independent Directors of the Company have given declarations that they meet thecriteria of independence as laid down under Section 149(6) of the Companies Act 2013 andRegulation 16(1) (b) of the SEBI LODR Regulations 2015. The Independent Directors havealso confirmed that they have complied with the Company's Code of Business Conduct &Ethics. The Independent Directors have also submitted a declaration to the Board ofcompliance of inclusion of name in Data Bank maintained by Indian Institute of CorporateAffairs (IICA) pursuant to Companies (Creation and Maintenance of Databank of IndependentDirectors) Rules 2019.

16. Declaration by the Board on the Independent Directors

In the opinion of the Board the Independent Directors fulfil the conditions ofindependence specified in Section 149(6) of the Companies Act 2013 and Regulation 16(1)(b) of the SEBI LODR Regulations 2015 and possess the requisite integrity expertise andexperience including the proficiency expected from the Independent Directors appointed onthe Board. The Independent Directors are yet to undergo the online proficiency test as onMarch 31 2020.

As on March 31 2020 the details of Directors pertaining to the online proficiencytest conducted by IICA are as below:

Director Designation Date of Registration Online Proficiency Test Requirement Status of Online Proficiency Test
1 Manish Mahendra Sabharwal Executive Chairman 27/02/2020 Voluntary _
2 Ashok Reddy Managing Director Exempted Exempted _
3 Latika Pradhan Independent Director 20/12/2019 Mandatory Shall be undertaken
4 Zarir Batliwala Independent Director 20/12/2019 Mandatory Shall be undertaken
5 V. Raghunathan Independent Director 23/12/2019 Voluntary _
6 Narayan Ramachandran Independent Director 03/01/2020 Voluntary _

17. Board Evaluation

Pursuant to the provisions of the Companies Act 2013 and Regulation 19 of SEBI LODRRegulations 2015 read with SEBI LODR Amendment Regulations the Board has carried out theAnnual Performance Evaluation (Board Evaluation/Evaluation) of its own performance theDirectors individually as well as the evaluation of the working of its various committees.

In line with the Corporate Governance Guidelines of the Company Evaluation wasconducted for all Board Members as well as on the functioning of the Board and itsCommittees.

This evaluation was led by the Chairman of the Nomination and Remuneration Committeewith specific focus on the performance and effective functioning of the Board. The Boardevaluation framework has been designed in compliance with the requirements under theCompanies Act 2013 and SEBI LODR Regulations 2015 and in consonance with Guidance Noteon Board Evaluation issued by SEBI in January 2017. The Board evaluation was conductedthrough questionnaire having qualitative parameters and feedback based on ratings.

Evaluation of the Board

Evaluation of the Board was based on criteria such as composition and role of theBoard communication and relationships between the Board of Directors functioning ofBoard Committees review of performance and compensation to Executive Directorssuccession planning strategic planning etc.

Evaluation of Directors

Evaluation of Directors was based on criteria such as participation and contribution inBoard and Committee meetings representation of shareholder interest and enhancingshareholder value experience and expertise to provide feedback and guidance to topmanagement on business strategy governance and risk understanding of the organization'sstrategy risk and environment etc.

Evaluation of Committees

Evaluation of Committees was based on criteria such as adequate independence of eachCommittee frequency of meetings and time allocated for discussions at meetingsfunctioning of Board Committees and effectiveness of its advice/recommendation to theBoard etc.

Evaluation of the Independent Directors

The Performance Evaluation of the Independent Directors was carried out by the entireBoard.

Some of the performance indicators based on which the Independent Directors areevaluated include:

• The ability to contribute to and monitor our corporate governance practices.

• The ability to contribute by introducing international best practices to addressbusiness challenges and risks.

• Active participation in long-term strategic planning.

• Commitment to the fulfilment of a Director's obligations and fiduciaryresponsibilities; these include participation in Board and Committee meetings.

• Performance of the directors.

• Fulfillment of the independence criteria as specified in these regulations andtheir independence from the management

Evaluation of the Chairman and Managing Director

The Performance Evaluation of the Chairman and Managing Director was carried out by theIndependent Directors.

The evaluation process has been explained in detail in the Report on CorporateGovernance as set out in pages 114 to 150 of this Annual Report. The Boardreviewed the evaluation results as collated by the Nomination and Remuneration Committee.

The evaluation process endorsed the Board Members' confidence in the ethical standardsof the Company the resilience of the Board and Management in navigating the Companyduring challenging times cohesiveness amongst the Board Members constructiverelationship between the Board and the Management and the openness of the Management insharing strategic information to enable the Board Members to discharge theirresponsibilities. It is specifically informed that directors subject to evaluation did notparticipate in the own evaluation process.

The Board has received improved ratings on its overall effectiveness including higherrating on Board communication relationships and Board Committees. The Board has alsonoted areas requiring more focus in the future.

18. Meetings of the Board

The meetings of the Board are scheduled at regular intervals to decide and discuss onbusiness performance policies strategies and other matters of significance.

The schedules of the meetings are circulated in advance to ensure proper planning andeffective participation in meetings. In certain exigencies decisions of the Board arealso accorded through Circular Resolution.

The Board during the Financial Year 2019-20 met five times. The maximum intervalbetween any two meetings did not exceed 120 days as prescribed in the Companies Act2013. Detailed information regarding the meetings of the Board are included in the reporton Corporate Governance as set out in pages 114 to 150 of this Annual Report.

19. Auditors

a. Statutory Auditors

As per the provisions of Section 139 of the Companies Act 2013 M/s. S. R. Batliboi& Associates

LLP Chartered Accountants (ICAI Firm Registration Number 101049W/E300004) Bangalorewere appointed as Statutory Auditors of the Company in the Annual General Meeting held onJuly 07 2017 for a period of five consecutive years at a remuneration mutually agreedupon by the Board of Directors and Statutory Auditors.

Auditor's Report

The Auditor's Report on the Financial Statements of the Company for the year endingMarch 31 2020 is modified and the details of audit qualification and the Directors'response are as below: The Auditors' Report is enclosed with the Financial Statementsforming part of the Annual Report.

Details of audit qualification by Statutory Auditors in Auditor's Explanation of the Board of Directors on audit qualification by Statutory
Report
Auditors in Auditor's Report
Attention is invited to the accompanying Independent Auditors Report (Standalone/Consolidated) more fully explaining management's position in relation to non-provision for possible shortfall in the value of the assets of the Provident Fund Trust managing the Company's defined benefit plan ("Team Lease Employees Provident Fund Trust" or "PF Trust"). The PF Trust has made unsecured investments of Rs 17373.78 Lakhs in bonds of certain non-banking financial companies ("NBFC Companies") which are under severe liquidity stress. These bonds fall due for repayment between FY 2020-21 to FY 2026-27. In the absence of sufficient evidence regarding eventual repayment of the bonds (including interest arrears) by the NBFC Companies the Independent Auditors are unable to comment on the appropriateness or otherwise of management's position regarding the non- provisioning of the possible shortfall in the value of the assets of the PF Trust and the consequential impact on the standalone Ind-AS financial results and the financial positions of the Company as at and for the year ended March 31 2020. The review report for the quarter ended December 31 2019 was also qualified in respect of this matter. The management in consultation with its PF Trust's investment advisor is of the view that the current reserves of the Trust and unrealized MTM gains will be sufficient to absorb any potential shortfall in Trust accounts till FY 2020-21.
Attention is invited to the accompanying Independent Auditors Report (Standalone/Consolidated) which is self-explanatory.

b. Secretarial Auditors

Section 204 of the Companies Act 2013 inter-alia requires every listed company toannex with its Board's Report a Secretarial Audit Report given by a Company Secretary inpractice in the prescribed form. The Board of Directors appointed Mr. Mukesh Siroya MSiroya & Company Practicing Company Secretaries Mumbai bearing Membership Number:5682 as Secretarial Auditor to conduct the Secretarial Audit of the Company for FinancialYear 2019-20 and his Report is annexed to this

Board Report as Annexure-III. The Board has also appointed Mr. Mukesh Siroya MSiroya & Company Practicing Company Secretaries Mumbai bearing Membership Number:5682 as Secretarial Auditor to conduct the Secretarial Audit of the Company for FinancialYear 2020-21.

c. Internal Auditors and Internal Audit System

Your Company has continued its engagement with M/s. Grant Thornton India LLP toconduct internal audit across the organization. We have also strengthened the in-houseinternal audit and compliance team to supplement and support the efforts of Grant ThorntonIndia LLP. Your Company conducted 4 (Four) meetings of the Audit Committee during the yearunder review.

d. Secretarial Compliance Report of TeamLease Services Limited for the year ended March31 2020

As per Regulation 24A of SEBI LODR Regulations 2018 read with SEBI Circular datedFebruary 08 2019; the listed entities are required to submit the Annual SecretarialCompliance Report with the exchange within sixty days of the end of the year. The same wassubmitted to the Stock Exchange(s) within the stipulated date and a copy of the same ishosted at our website at https://www.teamleasegroup.com/disclosures-made-stock-exchange-statutory-announcements.

e. Explanation or Comments on Qualifications Reservations or Adverse Remarks orDisclaimers made by the statutory Auditors and the Practicing Company Secretary in theirrespective Reports

In connection with the Statutory Audit of the Financial Statements for the year underreview there was one qualification remark in the report by the Statutory Auditors saveand except disclaimer made by them in discharge of their professional obligation theexplanation on the same from the Board of Directors is mentioned in 19 (a) above. Nofrauds are reported by the Statutory Auditor under sub section (12) of Section 143 of theCompanies Act 2013.

In connection with the Secretarial Audit of the Company for the year under reviewthere was no qualification reservation or adverse remark in the report by the SecretarialAuditors save and except disclaimer made by them in discharge of their professionalobligation.

f. Internal Financial Control

The Company has laid down certain guidelines processes and structures which enableimplementation of appropriate internal financial controls across the organization. Suchinternal financial controls encompasses policies and procedures adopted by the Company forensuring the orderly and efficient conduct of business including adherence to itspolicies safeguarding of its assets prevention and detection of frauds and errors theaccuracy and completeness of accounting records and the timely preparation of reliablefinancial information.

These include control processes both on manual and IT applications wherein thetransactions are approved and recorded. Appropriate review and control mechanisms arebuilt in place to ensure that such control systems are adequate and are operatingeffectively. Because of the inherent limitations of internal financial controls includingthe possibility of collusion or improper management override of controls materialmisstatements in financial reporting due to error or fraud may occur and not be detected.

Also evaluations of the internal financial controls are subject to the risk that theinternal financial control may become inadequate because of changes in conditions or thatthe compliance with the policies or procedures may deteriorate. The Company has in allmaterial respects an adequate internal financial controls system and such internalfinancial controls were operating effectively based on the internal control criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Control over Financial Reporting issued by theInstitute of Chartered Accountants of India.

Your Company has an effective internal control and risk-mitigation system which areconstantly assessed and strengthened with new/revised standard operating procedures. TheCompany's internal control system is commensurate with its size scale and complexities ofits operations. The internal and operational audit is entrusted to Grant Thornton ourInternal Auditors. The main thrust of internal audit is to test and review controlsappraisal of risks and business processes besides benchmarking controls with bestpractices in the industry. The Audit Committee of the Board of Directors actively reviewsthe adequacy and effectiveness of the internal control systems and suggests improvementsto strengthen the same. The Company has a robust Management Information System which isan integral part of the control mechanism. The Audit Committee of the Board of DirectorsStatutory Auditors and the Business Heads are periodically apprised of the internal auditfindings and corrective actions taken. Audit plays a key role in providing assurance tothe Board of Directors. Significant audit observations and corrective actions taken by themanagement are presented to the Audit Committee of the Board. To maintain its objectivityand independence the Internal Audit function reports to the Chairperson of the AuditCommittee.

g. Details in respect of adequacy of Internal Financial Controls with reference to theFinancial Statements

Your Company has in place adequate financial controls with reference to FinancialStatements. During the year under review such controls were reviewed and it did notobserve any reportable material weakness in the design or operation of financial controls.

h. Reporting of Frauds

There was no instance of fraud during the year under review which required theStatutory Auditors to report to the Audit Committee and / or Board under Section 143(12)of Companies Act 2013 and Rules framed thereunder.

i. Maintenance of Cost Records

The Company is not required to maintain cost records as specified by the CentralGovernment under subsection (1) of Section 148 of the Companies Act 2013.

20. Material changes and commitments if any affecting the Financial Position ofCompany occurred between the end of the Financial Year to which this Financial Statementsrelate and the date of the Report.

The following material changes and commitments have occurred after the closure of theFinancial Year 2019-20 till the date of this Report which would affect the financialposition of your Company:

Particulars Material Changes
1 Investments made by the Company Your Company has made investments in the following subsidiary and joint venture company respectively:
a. TeamLease E-Hire Private Limited of around Rs 5.72 Crores in Equity and making it wholly-owned subsidiary of the Company and
b. Avantis Regtech Private Limited of around Rs 3 Crores in Equity Share Capital thereby making the equity stake at the Joint Venture at 16.28 percent.
2. Corporate Social Responsibility Your Company had proposed to spend the entire prescribed amount of Rs 144.61 Lakhs during the Financial Year however in the unforeseen event of COVID-19 outbreak and circumstances beyond the control of the Company an amount of H 78.54 Lakhs remained unspent during the Financial Year under review. The Company spent Rs 66.07 Lakhs during the year for CSR activities.
As your company had already identified the projects before the COVID-19 outbreak in which the unspent funds were proposed to be utilized and the Company was holding the unspent amount for ongoing identified projects your Company had as on April 29 2020 transferred the unspent Corporate Social Responsibility Amount(s) of Rs 78.54 Lakhs in a designated escrow account maintained with Ratnakar Bank Limited Residency Road Bangalore Branch and the same shall be utilized as determined by the CSR Policy of the Company immediately on the ground situation being back to normal.
3. Waiver of remuneration by Executive and Non- Executive Directors for FY20-21 Mr. Ashok Reddy Managing Director and Mr. Manish Mahendra Sabharwal Chairman of the Company voluntarily opted to waive off their remuneration till such time as they deem fit.
The Independent Directors of the Company have also opted to voluntarily waive off their sitting fees for attending Board / Committee meetings of the Company till such time that they deem fit.

21. Acquisition of Companies / Investment in Associates/Subsidiaries during the yearunder review

a. During the year under review the Company had made the following acquisitions:

I.M.S.I Staffing Private Limited (IMSI) was acquired by your Company on November12 2019 with an investment of 72.70% stake in equity and additional 21.24% stake wasacquired by your Company on February 03 2020 bringing the total investment to 93.94% ason March 31 2020. IMSI is an IT Infra staffing company having its Registered Office atDehradun. IMSI is a leader in providing specialized technical manpower for managing ITInfrastructure projects hardware platforms OS platforms developing and maintainingenterprise software applications networking data management and storage andinternet-web-mobile-cloud platforms. IMSI has over 1838 associates deployed on 50+ panIndia projects with revenue of Rs 2054.18 Lakhs and PBT of Rs 241.09 Lakhs for the postacquisition period. IMSI is one of the largest manpower outsourcing partners in IT Infraspace in India. Over the past 20 years they have built strong customer relationship andbrand recall supported by reliable and efficient delivery engine.

b. During the year under review the Company had made the following Investments:

SL.NO FY 2018-19 FY 2019-20
1 TeamLease E-Hire Private Limited (Formerly known as Cassius Technologies Private Limited (Freshersworld) was an Associate Company w.e.f. June 01 2017 with an investment of 30% stake in Freshersworld by your Company. Your Company further acquired additional 25% stake in Freshersworld on July 04 2019 bringing the total investment to 76% as on March 31 2020.
TeamLease Services Limited had acquired additional 21% stake and pursuant to this investment Freshersworld became subsidiary Company w.e.f. August 01 2018.
2 TeamLease had acquired stake in Avantis through primary investment of Rs 5 crores through CCPS (Compulsorily Convertible Preference Shares) as on March 31 2019. Your Company acquired additional stake in Avantis through of Rs 2 crores through CCPS (Compulsorily Convertible Preference Shares) during the year under review thereby leading to an investment of Rs 7 crores through CCPS (Compulsorily Convertible Preference Shares).

22. Conservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo

Conservation of Energy The Company being in the service industry does not have any power generation units and does not produce/generate any renewable or conventional power. However Company has taken all steps to conserve energy in the work places by using energy saving lamps at all work stations and educating the employees to conserve energy.
Technology Absorption The Company being in Service Sector has adopted all new technology in terms of software and hardware for the better working and efficient reporting. The Company has an in house Information Technology team which constantly works on the adoption and implementation of new technology into the businesses of the Company.
Foreign Exchange Earnings and Outgo During the year under review the Company on standalone basis has incurred Rs 2 Lakhs towards expenditure in foreign currencies and earned Rs 523.93 Lakhs towards export of services.

23. Research and Development

The Company has not undertaken any Research and Development activity in any specificarea during the year under review and hence no cost has been incurred towards same.

24. Whistle Blower and Vigil Mechanism Policy

The Company believes in the conduct of the affairs of its constituents in a fair andtransparent manner by adopting the highest standards of professionalism honestyintegrity and ethical behavior. Pursuant to Section 177(9) of the Companies Act 2013 andRegulation 22 of the SEBI LODR Regulations 2015 a Whistleblower and Vigil MechanismPolicy was established for directors employees and stakeholders to report to themanagement instances of unethical behaviour actual or suspected fraud or violation ofthe Company's code of conduct or ethics policy genuine concerns to provide for adequatesafeguards against victimization of persons who use such mechanism and make provision fordirect access to the Chairperson of the Audit Committee. No person has been denied accessto the Chairperson of the Audit Committee. The said Policy is hosted on the website of theCompany at the following link https://www.teamleasegroup.com/ policy-documents.

25. Statement concerning development and implementation of Risk Management Policy ofthe Company

Pursuant to Regulation 21 of the SEBI LODR Regulations 2015 the Company hasconstituted Risk Management Committee comprising of Mr. Ashok Reddy as the Chairman andMrs. Latika Pradhan and Mr. Manish Mahendra Sabharwal as members to frame implement andmonitor the Risk Management plan for the Company. The committee is responsible forreviewing the risk management plan and ensuring its effectiveness. Major risks identifiedby the businesses and functions are systematically addressed through mitigating actions ona continuous basis.

Risk management is embedded in your Company's operating framework. Your Companybelieves that managing risks helps in maximizing returns. The Company's approach toaddressing business risks is comprehensive and includes periodic review of such risks anda framework for mitigating controls and reporting mechanism of such risks. The riskmanagement framework is reviewed periodically by the Board and the Audit Committee.

The Company has put in place an enterprise wide Risk Management Framework with anobject of timely identification of risks assessment and evaluation of the same in linewith overall business objectives and define adequate mitigation strategy. The RiskManagement Committee reviews critical risks on a rotation basis in line with themitigation progress/ effectiveness and its impact on overall risk exposure of the Companyall the critical risk areas are covered at least once a year. Annually all critical riskareas identified are re-evaluated.

26. Insider Trading Regulations

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations1992 as amended from time to time the Code of Conduct for Prohibition of Insider Trading(Code) as approved by the Board is in force by the Company. The Company also adopts theconcept of Trading Window Closure to prevent its Directors Officers designatedemployees their relatives and other connected employees from trading in the securities ofthe Company at the time when there is access to

Unpublished Price Sensitive Information (UPSI). The Company also has formulated acomprehensive Policy for Determination of Legitimate Purposes pertaining to UnpublishedPrice Sensitive Information and a comprehensive Policy for enquiry of leak UnpublishedPrice Sensitive Information.

27. Policies on Appointment of Directors and Remuneration of Directors Key ManagerialPersonnel(s) (KMP(s)) and Employees

In accordance with the provisions of Section 134(3) (e) of the Companies Act 2013 readwith Section 178(2) of the Act and Regulation 17 of the SEBI LODR Regulations 2015 theBoard of Directors have framed a policy which lays down a framework in relation toremuneration of Directors Key Managerial Personnel(s) (KMP(s)) and Senior Management ofthe Company. The Policy broadly lays down the guiding principles philosophy and the basisfor payment of remuneration to Executive and Non-Executive Directors (by way of sittingfees) Key Managerial Personnel(s) (KMP(s)) Senior Management and other employees. Thepolicy also provides the criteria for determining qualifications positive attributes andindependence of Director and criteria for appointment of Key Managerial Personnel(s)(KMP(s)) / Senior Management and performance evaluation which are considered by theNomination and Remuneration Committee and the Board of Directors while making selection ofthe candidates.

The Company's current Nomination and Remuneration Policy recommends having anappropriate mix of Executive and Independent Directors to maintain the independence of theBoard and separate its functions of governance and management. As on March 31 2020 theBoard consists of six Directors majority of them being Independent Directors. Besides theChairman and Managing Director who are the Promoters the Board comprises of fourIndependent Directors. The Board periodically evaluates the need for change in itscomposition and size. The Policy of the Company on Director's Appointment andRemuneration including criteria for determining qualifications positive attributesindependence of a Director and other matters as required under sub-section (3) of Section178 of the Companies Act 2013 are formulated by the Nomination and RemunerationCommittee.

Your Company has also adopted the Policy on appointment of directors and seniormanagement and Policy on Remuneration of Directors Key Managerial Personnel(s) (KMP(s))and Employees of the Company in accordance with the provisions of sub-section (4) ofSection 178 of the Companies Act 2013 and the same is furnished in Annexure IV ofthis Board's Report.

28. Board Diversity

A diverse Board enables efficient functioning through differences in perspective andskill and also fosters differentiated thought processes at the back of varied industrialand management expertise gender knowledge and geographical background. The Boardrecognizes the importance of a diverse composition and has adopted a Board DiversityPolicy which sets out the approach to diversity. The Policy is available at the web-link:https://www.teamleasegroup.com/policy-documents.

29. Details of Policy developed and implemented by the Company on its Corporate SocialResponsibility (CSR) initiatives

Pursuant to the provisions of Section 135 read with Schedule VII of the Companies Act2013 your Directors in their Meeting held on July 09 2015 have duly constituted theCorporate Social Responsibility Committee. The said Committee comprises of:

Members Designation
1 Mr. V. Raghunathan Chairman Independent Director
2 Mr. Manish Mahendra Sabharwal Member Executive Director
3 Mr. Ashok Reddy Member Executive Director

At TeamLease CSR has been an integral part of our business since its inception by thevery nature of the business being that of a Social Enterprise. During the year underreview the Company formally structured its CSR activity. Today the Company spans its CSRefforts to promote social and economic inclusion for the marginalized communities with itsintegrated system:

As part of its initiatives under Corporate Social Responsibility (CSR) the CSRCommittee has been entrusted with the prime responsibility of recommending to the Boardabout Corporate Social Responsibility Policy which shall indicate the activities to beundertaken by the Company as specified in Schedule VII of Companies Act 2013 the amountof expenditure to be incurred on CSR activities and monitoring the implementation of theframework of the CSR Policy. The CSR Policy has been placed on the Website of the Companyand can be accessed through the https://www.teamleasegroup. com/policy-documents

During the year under review your Company had allocated a limit equivalent to 2% ofthe average net profits of its three immediately preceding Financial

Years for implementation of CSR activities as per the Companies Act 2013 totaling to asum of Rs 144.61 Lakhs towards CSR however the Company could expend a sum of Rs 66.07Lakhs and there was a shortfall of Rs 78.54 Lakhs as on March 31 2020.

The details along with the statutory disclosures pursuant to Rule 8 of Companies(Corporate Social Responsibility Policy) Rules 2014 with respect to CSR activities formspart of this Annual Report and is annexed herewith as

Annexure-V.

30. Policy on Preservation & Archival of Documents

This policy is implemented as per Regulation 9 read with Regulation 30(8) of the SEBILODR Regulations 2015 for preservation of the documents inter alia to aid the employeesin handling the documents efficiently either in physical form or electronic form. ThisPolicy is intended to provide guidelines for the retention of records preservation ofrelevant documents for such duration after which the documents shall be archived and safedisposal/destruction of the documents. This policy is available on the Company's websitehttps://www.teamleasegroup.com/policy-documents It not only covers the various aspectson preservation but also archival of documents.

31. Business Responsibility Report

Pursuant to Regulation 34(2)(f) of the SEBI LODR Regulations 2015 the BusinessResponsibility (BR) Report of your Company for the year 2019-20 is set out in pages 151to 161 and forms an integral part of this Annual Report.

32. Particulars of Contracts or Arrangements made with Related Parties

All transactions entered with Related Parties for the year under review were on arm'slength basis and thus a disclosure in Form AOC-2 in terms of Section 134 of the CompaniesAct 2013 is not required. Further there are no material related party transactionsduring the year under review with the Promoters Directors or Key Managerial Personnel(s)(KMP(s)). All related party transactions are mentioned in the notes to the accounts. TheCompany has developed a framework through Standard Operating Procedures for the purpose ofidentification and monitoring of such Related Party Transactions.

Company has formulated a Policy on "Materiality of Related PartyTransactions" and on "the process of dealing with such transactions" whichare in line with the provisions of Section 188 of the Companies Act 2013 and Regulation23 of SEBI LODR Regulations 2015. The same is also available on the web-link:https://www. teamleasegroup.com/policy-documents.

Prior omnibus approval from the Audit Committee is obtained for transactions which arerepetitive and also normal in nature. Further disclosures on related party contracts andarrangements are made to the Audit Committee and the Board on a quarterly basis. Duringthe year under review there were no material related party transactions under Regulation23 (4) of SEBI LODR Regulations 2015 entered into by the Company which necessitatesapproval of Shareholders.

33. Extracts of Annual Return

The details forming part of the extracts of Annual Return pursuant to the provisions ofSection 92 of the Companies Act 2013 read with Rule 12 of the Companies (Management andAdministration) Rules 2014 (Form MGT-9) as on March 31 2020 is furnished in Annexure-VIof the Board's Report.

34. Credit Ratings

The Company continues to maintain its credit ratings. Pursuant to Schedule V Part C ofSEBI LODR Regulations 2015 read with Amendments thereof it is informed that the Companycontinues to maintain its credit ratings.

The Credit Rating Information Services of India Limited (CRISIL) & InvestmentInformation and Credit Rating Agency (ICRA) has continued to assign the ratings to theCompany's various credit facilities and debt instruments during the Financial Year 2019-20and they are as below:

Line of Credit of TeamLease Services Limited (LOC) for Rs 150.00 crore Long-term outstanding rating of ICRA A and short-term outstanding rating of ICRA A1 for Rs 100.00 crore LOC and a long-term rating of ICRA A and short-term rating of ICRA A1 to the additional limit of Rs 50.00 crore is assigned by ICRA Limited.
The Outlook on the long-term rating continues to be Stable.
Bank loan rating for H 150 Long-term rating of CRISIL A-/Stable and short-term rating of CRISIL A2+is assigned
Crore bank facilities by CRISIL.

35. Directors' Responsibility Statement

Based on the framework of internal financial controls established and maintained by theCompany work performed by the internal statutory and secretarial auditors and externalagencies the reviews performed by management and the relevant Board Committees theBoard with the concurrence of the Audit Committee is of the opinion that the Company'sinternal financial controls were adequate and effective as on March 31 2020.

To the best of knowledge and belief and according to the information and explanationsobtained by them your Directors make the following statements in terms of Section134(3)(c) of the Companies Act 2013:

(i) that in the preparation of the Annual Accounts for the year ended March 31 2020the applicable accounting standards have been followed along with proper explanationrelating to material departures if any;

(ii) the directors had selected such accounting policies and applied them consistentlyand made judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2020 and of the profit ofthe Company for the year ended on that date;

(iii) that the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

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

(v) that the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and

(vi) that the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

36. Compliance with Secretarial Standards

The Company has devised proper systems to ensure compliance with the provisions of allapplicable Secretarial Standards issued by the Institute of Company Secretaries of Indiaand that such systems are adequate and operating effectively.

37. Listing on Stock Exchange

The Equity Shares of the Company are listed on BSE Limited and National Stock Exchangeof India Limited since 2016.

38. Suspension of Securities of the Company

The securities of the Company have not been suspended from trading in any of the StockExchanges.

39. Details of Significant and Material orders passed by the Regulators or Courts orTribunals Impacting the Going concern status and Company's operations in future

During the year under review there were no significant and material orders passed bythe Regulators or Courts or Tribunals impacting the going concern status and Company'soperations in future.

40. Shares

a. Share Capital

As on March 31 2020 the Authorized Share Capital of the Company is Rs 2330.00 Lakhsand Paid-up

Share Capital is Rs 1709.68 Lakhs. Your Company has not issued or allotted anyshares/convertible securities/shares with differential voting rights during the year underreview.

As on March 31 2020 none of the Directors of the Company hold instruments convertibleinto Equity Shares of the Company.

b. Buy Back of Securities

The Company has not bought back any of its securities during the year under review.

c. Sweat Equity

The Company has not issued any Sweat Equity Shares during the year under review.

d. Issue of Bonus Shares

The Company during the year under review has not issued/ allotted any bonus shares.

e. Employee Stock Option Plan (ESOP)

Nomination and Remuneration Committee of the Board inter alia administers andmonitors the Company's Employees' Stock Option Plan (ESOP Plan) in accordance with SEBI(Share Based Employee Benefits) Regulations 2014 (SBEB Regulations). The ESOP Plan isimplemented through TeamLease ESOP Trust (ESOP Trust). During the year ended March 312020 a total of 403 Equity Shares of Rs 10/- each were transferred from the ESOP

Trust to one eligible employee under the Company's prevailing ESOP plan.

As at March 31 2020 the ESOP Trust held 30879 Equity Shares of the Company. Duringthe year ended March 31 2020 there has been no material change in the Company's existingplan and the plan is in compliance with SBEB Regulations. Note 33 of StandaloneFinancials Statements to be referred for information as required under SBEB Regulationsread with SEBI Circular CIR/CFD/POLICYCELL/2/2015 dated June 16 2015.

In addition to the above options granted to Senior Management Personnel during theyear are as mentioned below: (a) Senior managerial personnel:

Employee name No. ESOP's Designation Date of grant 01st vesting 02nd vesting 03rd vesting
1 N Ravi Vishwanath 7250 Chief Financial 01-Jul- 2418 on 2416 on 2416 on
Officer 19 30-Jun-20 31-Mar-21 31-Mar-22
2 Rituparna 7250 VP-Finance 01-Jul- 2418 on 2416 on 2416 on
Chakraborthy 19 30-Jun-20 31-Mar-21 31-Mar-22
3 Ramani Dathi 3655 Finance 01-Jul- 1219 on 1218 on 1218 on
Controller 19 30-Jun-20 31-Mar-21 31-Mar-22
Total 18155 6055 on 6050 on 6050 on
30-Jun-20 31-Mar-21 31-Mar-22

(b) any other employee who receives a grant in any one year of option amounting to 5%or more of option granted during that year; and : NIL

(c) identified employees who were granted option during any one year equal to orexceeding 1% of the issued capital (excluding outstanding warrants and conversions) of thecompany at the time of grant. : NIL

The Company has received a certificate from the Statutory Auditor that the Scheme hasbeen implemented in accordance with SEBI Share Based Employee Benefits (SBEB) Regulations2014 and in line with the resolutions passed/ approved by the Shareholders in this regard.The said Certificate shall be made available at the Annual General Meeting for inspectionby the Members.

41. Particulars of Employees

The information required under Section 197(12) of the Companies Act 2013 read withRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 is furnished in Annexure VII of the Board's Report.

Pursuant to Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 the particulars of the top 10 employees in terms ofremuneration drawn are furnished in Annexure VIII of the Board's Report.

There were three employees during the Financial Year drawing remuneration of Rs 1.02crore per annum or more whose details form part of Annexure VIII. There was oneemployee who was employed for a part of the Financial Year and have drawn a remunerationof more than Rs 8.5 lakhs per month whose details form part of Annexure VIII.

42. Disclosure under Sexual Harassment of Women at workplace (Prevention Prohibitionand Redressal) Act 2013

At TeamLease Services Limited all employees are of equal value. There is nodiscrimination between individuals at any point on the basis of race colour genderreligion political opinion national extraction social origin sexual orientation orage. All employees (permanent contractual temporary and trainees) are covered under thispolicy. The Company has complied with the provisions relating to the constitution ofInternal Complaints Committee under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013.

The following is a summary of sexual harassment complaints received and disposed offduring the year under review: The same were investigated in accordance with proceduresprescribed and adequate steps were taken to resolve them.

Particulars Numbers
No. of complaints pending at the beginning 0
of the Financial Year 2019-20:
No. of complaints received during the 5
Financial Year 2019-20:
No. of complaints disposed off during the 5
Financial Year 2019-20:
No. of complaints pending at the end of the 0
Financial Year 2019-20:

43. Human Resources

The Company has all required policies under the required laws for the time being inforce and as required under the Companies Act 2013 and SEBI LODR Regulations 2015 thepolicies pertaining the Code of Conduct and Business Ethics Policy for employees seniormanagement team and directors Policy on Succession Plan and Prevention of SexualHarassment Policy as required under the provisions of Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013 Whistle Blower and VigilMechanism Policy Anti-Bribery Policy Policy on Insider Trading as required under SEBIProhibition of Insider Trading Regulations 1992 and subsequent Amendments made thereonetc. and all the Policies/Codes have been uploaded in the Website of the Companyhttps://www. teamleasegroup.com/policy-documents.

44. Statutory Disclosures

None of the Directors of your Company are disqualified as per the provisions of Section164(2) of the Companies Act 2013. Your Directors have made necessary disclosures asrequired under various provisions of the Companies Act 2013 and SEBI LODR Regulations2015.

The Company has received a Certificate pursuant to Schedule V(10)(i) of SEBI LODRAmendment Regulations 2018 from Mr. Mukesh Siroya M Siroya & Company PracticingCompany Secretaries Mumbai bearing Membership Number: 5682 that none of the directorson the Board of the company have been debarred or disqualified from being appointed orcontinuing as directors of companies by the Board/Ministry of Corporate Affairs or anysuch statutory authority during the period under review.

The certificate is annexed to the Board's Report as

Annexure IX.

45. Change in nature of business

There has been no change in the nature of business of the Company. Your Companycontinues to one-stop provider of human resources services to various industries anddiverse functional roles offering staffing payroll processing recruitment complianceand training services. Your Company set in motion the larger company mission of‘Putting India to Work' by focusing on its vision of 3 E's – EmploymentEmployability and E-workforce.

46. Declaration on Code of Conduct

The Company has adopted the Code of Conduct for all its Senior Management Personnel andDirectors and the same is affirmed by all the Board Members and Senior ManagementPersonnel as required under Regulation 34 read with Part D of Schedule V of the SEBI LODRRegulations 2015. A declaration signed by Mr. Ashok Reddy Managing Director of theCompany affirming the compliance with the Code of Conduct of the Company for the FinancialYear 2019-20 as set out in Corporate Governance Report in pages 114 to 150 of thisAnnual Report.

47. MD and CFO Certification

As required by SEBI LODR Regulations 2015 the Managing Director and Chief FinancialOfficer have given appropriate certifications to the Board of Directors and the same formspart of the Corporate Governance Report.

48. Cautionary Statement

Statements in this Directors' Report and Management Discussion and Analysis Reportdescribing the Company's objectives projections estimates expectations or predictionsmay be "forward-looking statements" within the meaning of applicable securitieslaws and regulations. Actual results could differ materially from those expressed orimplied. Important factors that could make difference to the Company's operations includechanges in Government regulations Tax regimes economic developments within India andother ancillary factor.

49. Acknowledgements

Your Directors sincerely thank the various Central and State Government Departmentsespecially the Ministry of Labour for the help and co-operation extended by them duringthe year.

The Directors place on record their sincere appreciation towards various organizationsand agencies for their continued support. Your Directors also gratefully acknowledge allstakeholders of the Company viz. Shareholders customers dealers vendors banks andother business partners for the excellent support received from them during the year.

Your directors also wish to place on record their appreciation for the contributionmade by the employees at all levels for their unstinted commitment and continuedcontribution to the Company. Our consistent growth was made possible by their hard worksolidarity co-operation and support.

For and on Behalf of Board of Directors
Ashok Reddy Latika Pradhan
Managing Director Director
DIN: 00151814 DIN: 07118801
Place: Bangalore
Date: June 09 2020

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