Eighth Annual Report 201819 M1086 K1086...Mr. Rajeev Sardana 4 Mr. Keyur Shah 5 Mr. S. N. Shroff 5...

Eighth Annual Report 2018-19

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HDFC Education and Development Services Private Limited

TO THE MEMBERSYour directors are pleased to present the Eighth annual report of your Company with the audited accounts for the year ended March 31, 2019.

Financial Results

For the year ended For the year ended March 31, 2019 March 31, 2018 (`) (`)

Loss for the year 7,77,88,473 10,28,74,365Provision for Tax — — Loss after Tax 7,77,88,473 10,28,74,365Other comprehensive expense 26,184 60,712

Total comprehensive loss for the year 7,78,14,657 10,29,35,077Share issue expense during the year 45,75,000 52,93,000Equity component of compound financial instruments 16,35,37,506 16,35,37,506Loss brought forward from previous year 28,01,80,133 17,19,52,056 Balance carried to Balance Sheet (19,90,32,284) (11,66,42,627)

Mr. V. Srinivasa Rangan (DIN:00030248) Mr. Conrad D’Souza (DIN: 00010576) Mr. Rajeev Sardana (DIN: 06648276) Mr. S. N. Shroff# (DIN: 00011169) Mr. Keyur Shah# (DIN: 00332145) Mr. Sudhir Kumar Jha (DIN: 07130697) Mr. Yogesh Kapur (DIN: 00070038) (#Independent Director)

Statutory AuditorsDeloitte Haskins & Sells LLPChartered Accountants

Key Managerial Personnel Ms. Simrita Ahluwalia Chief Executive Officer (PAN: AFLPA9741C) Mr. Ramesh Nayal Chief Financial Officer (ICAI Membership No.: 507968) Mr. Lalit V. Jain Company Secretary (ICSI Membership No.: A37005)

Bankers HDFC Bank Limited

Registered Office Ramon House, H. T. Parekh Marg, 169, Backbay Reclamation, Churchgate, Mumbai 400 020Tel. Nos. : +91 22 6176 6000 +91 22 6631 6219Fax No. : +91 22 2281 1205CIN: U80301MH2011PTC224035

Convergence to Ind ASThe Ministry of Corporate Affairs on January 18, 2016 notified the Companies (Indian Accounting Standards) Rules, 2015 (Ind AS Rules) effective from April 1, 2015 and suggested a phased convergence to Ind AS by various classes of companies.As per the Ind AS Rules, Housing Development Finance Corporation Limited (HDFC), holding company being a Housing Finance Company was required to prepare financial statement as per Ind AS from the financial year 2018-19. Accordingly your Company, being a subsidiary of HDFC, was also required to converge to Ind AS from the current year, in terms of the Ind AS Rules.

DividendDue to unavailability of profits, your directors do not recommend any dividend for the year ended March 31, 2019.

Review of OperationsYour Company is a whol ly owned subsidiary of HDFC, which focuses on education sector.The object ive of the Company entering the education space is to imbibe best practices in education and facilitate innovation, thereby creating a visible impact on the schooling system in the country.The fi r s t schoo l to wh ich the Company is providing services,The HDFC School Gurugram, was inaugurated in March 2015. The said

Directors’ ReportBoard of Directors

Note: The financial statements for the year ended March 31, 2019 have been prepared under Indian Accounting Standards (Ind AS). The financial statements for the year ended March 31, 2018 have been restated in accordance with Ind AS for comparative purposes.


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school had started the primary wing from a rented building at Gurugram.T h e C o m p a ny o w n s a 5 a c r e school plot adjoining the school and the construction of the phase 1 of the school building, which is being used for the senior wing of the school, was completed in April 2017. The Company has leased the building to the school in 2017 and the school has reached up to Grade X this year.The Company has also star ted the planning and development of Phase 2 which would be ready to be delivered in October 2019. The total number of students in the school is 550 as on March 31, 2019.The second school to which the Company is providing services is The HDFC School, Pune. The said school operates from a long term rented premises and will commence the 3rd Academic Session from April 2019 for classes upto Grade IX. The total number of students in this School is 853 as on March 31, 2019.The third school to which the Company is providing services is The HDFC School, Bengaluru which is also operating from a long term rented premises. The school will commence its 2nd Academic Session from April 2019 for classes upto Grade VII with 160 students.All the HDFC School(s) are intended to be a full-fledged K-12 schools and are following the National Curr iculum Framework, 2005. The schools will be Central Board of Secondary Education(CBSE) affiliated schools.There was no change in the nature of business of your Company nor was there any material change or commitment that would affect its financial position during the year as also till the date of this Report.

Increase in Authorised Share CapitalDuring the year, pursuant to the receipt of approval of the Members of the Company at an Extra-ordinary General Meeting held on November 19, 2018, the authorised share capital of the Company was increased from ` 90 crore comprising 9,00,00,000 equity shares of ` 10 each to ` 135 crore comprising of 13,50,00,000 equity shares of ` 10 each.

Issue of Equity SharesDuring the year, your Company issued 9,70,00,000 equity shares of `10 each in aggregate for cash at par, amounting to `97 crore to HDFC, on a rights basis.As at March 31, 2019, the paid-up share capital of the Company stood at `134 crore.

Dematerialisation of sharesThe Ministry of Corporate Affairs notified Companies (Prospectus and A l lotment of Secur i t ies ) (Third Amendment) Rules, 2018, wherein every unl isted public company was mandated to facilitate dematerialisation of all its existing securities. In compliance with the said notification, your Company in order to facilitate dematerialisation of all its securities, appointed Link Intime India Private Limited as Registrar and Share Transfer Agent and National Securities Depository Limited as the designated depository. All the issued shares of your Company are held in dematerialised form.

Redemption of Optionally Convertible DebenturesDuring the year, your Company redeemed 6,30,00,000 Optionally Convertible Debentures (OCDs) of ` 10 each amounting to ` 63 crore which were held by HDFC. As at March 31, 2019, there were no outstanding OCDs.

Loans, Guarantees or InvestmentsDuring the year, your Company has not given any loan or provided any guarantee or security or made any investment.

Pa r t i c u l a r s o f C o n t r a c t s o r Arrangements with Related PartiesYour Company has not entered into any contracts or arrangements with related parties requiring disclosure in Form No. AOC–2, as prescribed under Rule 8(2) of the Companies (Accounts) Rules, 2014.Details of other related par ty transactions are provided in the notes to the financial statements.DepositsYour Company has not accepted any deposit and as such, no amount of principal or interest was outstanding as at March 31, 2019.Subsidiary/Associate CompaniesYour Company does not have any subsidiary or associate company.Particulars of EmployeesYour Company had 4 employees as at March 31, 2019 and some of the affairs of the Company are also being carried out by the employees of HDFC.

Particulars regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and OutgoThe operations of your Company are not energy intensive. However, adequate measures have been taken for conservation of energy and usage of alternative source of energy,wherever possible. During the year, your Company had no dealings in foreign exchange.

DirectorsIn accordance with the provisions of the Companies Act, 2013 and

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the Articles of Association of the Company, Mr. Rajeev Sardana and Mr. Yogesh Kapur are liable to retire by rotation at the ensuing Annual General Meeting (AGM). They are eligible for re-appointment.The Ministry of Corporate Affairs has exempted unlisted Public Companies (including wholly owned subsidiaries), irrespective of its paid-up share capital, from appointing Independent Directors. Accordingly, the board has approved appointment of Mr. Keyur Shah as a Non-Executive Director of the Company liable to retire by rotation, with effect from March 24, 2020, subject to the approval of the Members at the ensuing AGM. The board has also approved the re-appointment of Mr. S. N. Shroff as an Independent Director of the Company for a term of 5 consecutive years with effect from March 24, 2020, subject to the approval of Members at the ensuing AGM. This is because the present tenure of Mr. Shah and Mr. Shroff expires on March 23, 2020. The board deliberated on the contributions made by Mr. S. N. Shrof f and Mr. Keyur Shah and concluded that given their vast experience, knowledge and inputs to the board, it would be beneficial for the Company to retain them as directors.The necessary resolutions for the appointment/ re-appointment of the directors and their details as required under secretarial standards have been included in the notice convening the ensuing AGM.All the directors of the Company have confirmed that they are not disqualified from being appointed as directors, in terms of Section 164(2) of the Companies Act, 2013.

None of the directors of your Company have been debarred from holding the office of director by virtue of any order from the Securities and Exchange Board of India (SEBI) or any other such authority.The independent directors have also confirmed that they satisfy the criteria prescribed for an independent director as stipulated in Section 149(6) of the Companies Act, 2013.

Board MeetingsDuring the year, the board met five times. The meetings were held on April 19, 2018, July 24, 2018, October 27, 2018, January 18, 2019 and February 25, 2019.The attendance of the directors at the above-mentioned board meetings is listed below:

Directors Number of Meetings attended

Mr. V. Srinivasa Rangan 5Mr. Conrad D’Souza 5Mr. Rajeev Sardana 4Mr. Keyur Shah 5Mr. S. N. Shroff 5Mr. Sudhir Kumar Jha 4Mr. Yogesh Kapur 4

Leave of absence was granted to the concerned directors who could not attend the respective board meetings.

Audit CommitteeThe Audit Committee consists of a majority of independent directors. The members of the committee are Mr. Keyur Shah (Chairman), Mr. S. N. Shroff and Mr. V. Srinivasa Rangan.The members of the Audit Committee have accounting, financial management and legal expertise.

The quorum for the Audit Committee meeting is two members.The terms of reference of the Audit Committee inter alia include approving and implementing the audit procedures and techniques, reviewing the financial reporting systems, financial statement, internal financial control systems and procedures, records relating to related party transactions, analysis of risks and compliance of regulatory guidelines. The financial results are made available to the committee in advance. This enables review and discussions with the auditors before recommending it to the Board of Directors for its approval.The committee also grants approval for related party transactions and reviews the said transactions on a periodic basis.During the year, the committee met four times. The meetings were held on April 19, 2018, July 24, 2018, October 27, 2018 and January 18, 2019.The attendance of the members of the committee at the above-mentioned meetings is listed below:

Members Number of Meetings attended

Mr. Keyur Shah (Chairman)

4

Mr. S. N. Shroff 4Mr. V. Srinivasa Rangan 4

Nomination and Remuneration CommitteeThe Nomination and Remuneration Committee consists half of independent directors. The members of the committee are Mr. Conrad D’Souza (Chairman), Mr. S.N. Shroff, Mr. Keyur Shah and Mr. Rajeev Sardana. The quorum for


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the Nomination and Remuneration Committee meeting is two members.

The terms of reference of the committee inter alia include identifying persons who are qualified to become directors of the Company, ensuring that such persons meet the relevant criteria prescribed under applicable laws, carrying out evaluation of every director’s performance, formulating the Policy for Appointment of Director and Members of Senior Management and the Remuneration Policy and formulating the criteria for determining qualifications, positive attributes and independence of a director and for evaluating their performance.

The Policy on Appointment of Directors and Members of Senior Management inter alia lays down the criteria for appointment including qualifications, attributes, experience and skills etc., the nomination and evaluation process.

The Remuneration Policy ensures that remuneration is aligned to the overall performance of the Company, is fair and reasonable to attract and retain necessary talent, is linked to attaining performance benchmarks and involves a judicious balance of fixed and variable components.

The Policy on Appointment of Directors and Members of Senior Management and the Remuneration Policy are available at www.hdfc.com/the-hdfc-group/subsidiaries-policies.

During the year, the committee met three times. The meetings were held on April 19, 2018, July 24, 2018 and January 18, 2019.

The attendance of the members of the committee at the above-mentioned meetings is listed below:


Mr. Conrad D’Souza (Chairman)

3

Mr. S. N. Shroff 3Mr. Keyur Shah 3Mr. Rajeev Sardana 3

Risk Management CommitteeAs a good governance measure and for ensuring that risks faced by your Company are identified, accepted and mitigated in a timely manner, during the year, your Company constituted a Risk Management Committee comprising Mr. Conrad D’Souza (Chairman), Mr. Sudhir Kumar Jha, Mr. Keyur Shah and Ms. Simrita Ahluwalia. The quorum for the Risk Management Committee Meeting is two members.The terms of reference of the committee inter alia include reviewing the risk profile of the Company. Your directors are of the opinion that the Company is managing its risks through well-defined internal financial controls and that there are no risks that may threaten the existence of your Company.During the year, the committee met twice. The meetings were held on October 27, 2018 and March 27, 2019.The attendance of the members of the committee at the above-mentioned meetings is listed below:


Mr. Conrad D’Souza (Chairman)

2

Mr. Sudhir Kumar Jha 1Mr. Keyur Shah 2Ms. Simrita Ahluwalia 2

Leave of absence was granted to the concerned member who could not attend the meeting.

Independent DirectorsThe independent directors convene separate meetings to discuss various issues at their discretion, as and when required, to evaluate the performance of the directors of the Company, and the board as a whole. The independent directors also assess the quality, quantity and timeliness of flow of information between the Company’s management and the board which enables the board to effectively and reasonably perform its duties.During the year, the independent directors met once on March 18, 2019.The attendance of the independent directors at the above-mentioned meeting is listed below:

Directors Number of Meeting attended

Mr. S. N. Shroff 1Mr. Keyur Shah 1

Board EvaluationDuring the year, the Nomination and Remuneration Committee continued w i th the same methodo logy and cr i te r ia to eva luate the performance of the board as a whole and its committees as well as the performance of each director individually, as in the previous year. The criteria for evaluation were voluntarily benchmarked with the Guidance Note issued by the SEBI on board evaluation.The evaluat ion of the board, committees thereof and of each director was done through a structured and comprehensive questionnaire, inter alia containing effectiveness

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of the board and its committees, process of decision making, active participation, independence, quality and content of agenda papers, frequency of meetings, discussions at meetings, cohesion in meetings, contribution and management of conflict of interest.The Chairman of the Nomination and Remuneration Committee reviewed the feedback received from the directors on the said questionnaire and prepared a consolidated report. The said consolidated report was inter alia reviewed by the Nomination and Remuneration Committee.The Chairman of the Nomination and Remuneration Committee shared the results of evaluation at the meeting of the Board of Directors. The board reviewed the results and expressed its satisfaction on the same. There were no actionable from the said review.The Company conducts familiarisation programme for its directors from time to time. These familiarisation programmes ensures that the directors are updated on the business and regulatory environment as well as the overall operations of the Company. These programmes enable the directors to make better informed decisions in the interest of the Company and its stakeholders.

AuditorsAt the Third AGM of the Members of the Company held on July 30, 2014, the members had appointed Messrs Deloitte Haskins & Sells LLP, Chartered Accountants, having Firm Registration Number 117366W/ W-100018 as the statutory auditors of the Company, for a period of 5 years, to hold office as such until the conclusion of the Eighth AGM.In accordance with Section 139 of

the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, as the present term of the statutory auditors would be completed in the ensuing AGM, the Board of Directors of the Company pursuant to recommendation of the Audit Committee proposes to re-appoint Messrs Deloitte Haskins & Sel ls LLP as the statutor y auditors of the Company for a term of 2 consecutive years to hold office from the conclusion of the Eighth AGM until the conclusion of the Tenth AGM.

Messrs Deloitte Haskins & Sells LLP have consented to the said appointment and have issued a certificate to the effect that the appointment, if made, shall be in accordance with the conditions as prescribed in Section 139 of the Companies Act,2013 and the Companies (Audit and Auditors) Rules, 2014. They have confirmed that they meet the criteria for independence, eligibi l i ty and qualification as prescribed in Section 141 of the Companies Act, 2013.

The necessary resolution for the re-appointment of the statutory auditors have been included in the notice convening the ensuing AGM.

The Auditors’ Report annexed to the financial statements for the year under review does not contain any qualification.

Further, pursuant to the provisions of Section 138 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, the Company has appointed Messrs A. Aneja & Co., Chartered Accountants as internal auditors of the Company to review internal controls and compliances under various regulations that are applicable to the Company.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Messrs N. L. Bhatia & Associates, practising company secretar ies to under take the secretarial audit of the Company. The Secretarial Audit Report is annexed to this Report and does not contain any qualifications.

Significant and Material Orders passed by Regulators or Courts or Tribunals

During the year, no significant or material orders were passed by any regulator or court or tribunal against the Company impacting the going concern status and the Company’s operations in future.

Internal Financial Controls

The Company has put in place adequate procedures to ensure that the system of internal financial control is commensurate with the size and nature of the Company’s business. These systems provide a reasonable assurance in respect of providing financial and operational i n fo rmat ion , comp ly ing w i th applicable statutes, safeguarding of assets of the Company, prevention and detection of frauds, accuracy and completeness of accounting records and ensuring compliance.

Secretarial Standards

The Company has complied with the applicable provisions of Secretarial Standards 1 and 2 issued by The Institute of Company Secretaries of India.

Directors’ Responsibility StatementIn accordance with the provisions


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of Section 134(3)(c) of the Companies Act, 2013 and based on the information provided by the management, your directors state that:a. In the preparation of the annual accounts, the applicable accounting standards have been followed;b. Accounting policies selected have been applied consistently. Reasonable and prudent judgements and estimates have been made so as to give a true and fair view of the state of affairs of the Company at March 31, 2019 and of the loss of the Company for the year ended on that date;c. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for

preventing and detecting frauds and other irregularities;d. The annual accounts of the Company have been prepared on a going concern basis; ande. Systems to ensure compliance with the provisions of all applicable laws are in place and were adequate and operating effectively.

Annual Return and Extract thereofThe extract of Annual Return in Form No. MGT-9 as required under the provisions of the Companies Act, 2013 is annexed to this Report. The Annual Return for the financial year 2018-19 is uploaded at www.hdfc.com/the-hdfc-group/subsidiaries-policies.

AcknowledgementsYour directors would like to express their sincere appreciation to all its stakeholders for their support and

continued patronage.Your directors appreciate the guidance received from various statutory/regulatory authorities including the Ministry of Corporate Affairs – Government of India,the Registrar of Companies, Mumbai and the depositories.Your directors recognise and appreciate the sincere hard work, loyalty and efforts of the employees of the Company in ensuring that the Company performs well. Your directors also wish to place on record their appreciation to all the employees of HDFC who devoted their valuable time in managing the affairs of the Company.

On behalf of the Board of Directors

Conrad D’SouzaNew Delhi Rajeev SardanaMay 2, 2019 Directors

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Annex to Directors’ Report - I

FORM NO. MR-3SECRETARIAL AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED MARCH 31, 2019[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule No. 9 of the Companies

(Appointment and Remuneration of Managerial Personnel) Rules, 2014]

To,The Members,HDFC EDUCATION AND DEVELOPMENT SERVICES PRIVATE LIMITEDWe have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by HDFC EDUCATION AND DEVELOPMENT SERVICES PRIVATE LIMITED (hereinafter called the Company). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing our opinion thereon.Based on our verification of books, papers, minute books, forms and returns filed and other records maintained by the Company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of Secretarial Audit, we hereby report that in our opinion, the Company has, during the audit period covering the financial year ended on March 31, 2019 has complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended on March 31, 2019 according to the provisions of:1. The Companies Act, 2013 (the Act) and the Rules made thereunder including amendments and statutory

modifications;2. The Depositories Act, 1996 and the regulations and Bye-laws framed thereunder.Other applicable Laws as per list attached as ‘Annexure A’ to this report.We have also examined compliance with the applicable clauses of the Secretarial Standards 1 and 2 issued by The Institute of Company Secretaries of India.During the period under review, the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards, etc. mentioned above.We further report that the Board of Directors of the Company is duly constituted with proper balance of Non-Executive Directors and Independent Directors. There were no change in the Composition of the Board during the year.Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance except for the Board Meeting held on February 25, 2019 which was held at a shorter notice in compliance with the applicable provisions of the Act and Secretarial Standard and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting. The Company has complied with the Secretarial Standards in respect of the meetings of its members, Board and its committees.Majority decision is carried through while the dissenting members’ views were not required to be captured and recorded as part of the minutes as there were no such instances.We further report that there are adequate systems and processes in the Company commensurate with the size and operations of the Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.We further report that during the Audit Period, the Company has not undertaken any specific events/ actions that can have a major bearing on the Company’s compliance responsibility in pursuance of the above referred laws, rules, regulations, guidelines, standards, etc., except as follows:


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i. Increase in Authorized Share Capital: During the Audit Period, the Company obtained the approval of its members through Extra-ordinary General

Meeting held on November 19, 2018 for increasing its Authorised Share Capital from ` 90 crore comprising 9,00,00,000 equity shares of ` 10 each to ` 135 crore comprising of 13,50,00,000 equity shares of ` 10 each and consequentially amending Clause V of its Memorandum of Association.

ii. Rights Issue of equity shares: During the Audit Period, the Company issued 9,70,00,000 equity shares of ` 10 each in aggregate for cash at

par, amounting to ` 97 crore to existing shareholders as on record date, on a rights basis.iii. Redemption of Optionally Convertible Debentures (OCDs): During the Audit Period, the Company redeemed 6,30,00,000 (OCDs) of ` 10 each amounting to ` 63 crore

which were held by Housing Development Finance Corporation Limited, holding company.

For M/s N. L. Bhatia & Associates Practicing Company Secretaries UIN: P1996MH055800

Sd/- N L Bhatia April 17, 2019 Managing Partner Mumbai FCS: 1176 CP. No. 422

Annex to Directors’ Report - I (Continued)

LIST OF OTHER APPLICABLE LAWS (including statutory amendments made thereto or amendments

thereof for the time being in force)

1. Bombay Shop and Establishment Act, 1948, rules thereunder and other State Acts and rules thereunder, including statutory amendments made thereto.

2. The Securities Contracts Act, 1956 (‘the Act’) and the rules made thereunder including any re-enactment thereof;3. The Employees Provident Fund and Miscellaneous Provisions Act, 19524. Maternity Benefit Act, 1961 and applicable State Rules.5. Payment of Gratuity Act, 1972 and applicable State Rules.6. Income Tax Act 1961, Central Goods and Services Tax Act, 2017, State Goods and Services Tax Act, 2017 and

Integrated Goods and Services Tax Act, 2017 and other State Acts governing VAT, Profession Tax, Entry Tax, Tax on Trades, Callings and Employments Act and rules thereunder.

‘ANNEXURE A’

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Annex to Directors’ Report – II

FORM NO. MGT-9EXTRACT OF ANNUAL RETURN

As on the financial year ended on March 31, 2019[Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1)

of the Companies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS

CIN U80301MH2011PTC224035Registration Date November 17, 2011Name of the Company HDFC EDUCATION AND DEVELOPMENT SERVICES PRIVATE

LIMITEDCategory/ Sub-Category of the Company Company limited by shares/Non- Government CompanyAddress of the Registered Office and Contact Details

Ramon House, H. T. Parekh Marg, 169, Backbay Reclamation, Churchgate, Mumbai 400 020Tel. Nos.: +91 22 6176 6000/6631 6219 Fax No.: +91 2281 1205

Whether listed company Yes/ No NoName, Address and Contact Details of Registrar and Transfer Agent, if any

Link Intime India Private Limited C 101, 247 Park, L B S Marg, Vikhroli West, Mumbai 400 083 Tel. No.: +91 22 4918 6000 E-mail: [email protected]

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY All the business activities contributing 10% or more of the total turnover of the Company:

Sr. No.

Name and Description of main Products/Services NIC Code of the Product /Service

% of Total Turnover of the Company

1 Engaged in the provision of education services 85500 100

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIESSr. No.

Name and Address of the Company CIN/GLN Holding/ Subsidiary/ Associate

% of Shares Held

Applicable Section

1 HOUSING DEVELOPMENT FINANCE CORPORATION LIMITEDRamon House, H. T. Parekh Marg, 169, Backbay Reclamation, Churchgate, Mumbai 400 020

L70100MH1977PLC019916 Holding 100 2(46)


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IV. SHAREHOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity) (i) Category-wise Shareholding:

Category of Shareholders No.of Shares held at the beginning of the year No.of Shares held at the end of the year % Change during the

year

Demat Physical Total % of Total Shares

Demat Physical Total % of Total Shares

A. Promoters

(1) Indian(a) Individual/ HUF — — — — 120* — 120* 0.00 0.00(b) Central Govt. — — — — — — — — —

(c) State Govt.(s) — — — — — — — — —

(d) Bodies Corp. — 3,70,00,000 3,70,00,000 100 13,39,99,880 — 13,39,99,880 100 0.00(e) Banks/FI — — — — — — — — —

(f) Any Other — — — — — — — — —

Sub-total (A)(1) — 3,70,00,000 3,70,00,000 100 13,40,00,000 — 13,40,00,000 100 —

(2) Foreign — — — — — — — — —

Sub-total (A)(2) — — — — — — — — —

Total Shareholding of Promoters (A) = (A)(1)+(A)(2)

— 3,70,00,000 3,70,00,000 100 13,40,00,000 — 13,40,00,000 100 —

B. Public Shareholding

(1) Institutions — — — — — — — — —

Sub-total (B)(1) — — — — — — — — —

(2) Non-Institutions — — — — — — — — —

Sub-total (B)(2) — — — — — — — — —

Total Public Shareholding (B)=(B)(1)+(B)(2)

— — — — — — — — —

C. Shares Held by Custodian for GDRs & ADRs

— — — — — — — — —

Grand Total (A+B+C) — 3,70,00,000 3,70,00,000 100 13,40,00,000 — 13,40,00,000 100

*The beneficial owner of these Shares is Housing Development Finance Corporation Limited.

Annex to Directors’ Report – II (Continued)

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(ii) Shareholding of Promoters:

Sr. No.

Shareholders’ Name Shareholding at the beginning of the year Shareholding at the end of the year % Change in Shareholding

During the yearNo. of Shares % of Total

Shares of the Company

% of Shares Pledged /

Encumbered to Total Shares

No. of Shares % of Total Shares of the

Company

% of Shares Pledged /

Encumbered to Total Shares

1. Housing Development Finance Corporation Limited

3,69,99,880 100 — 13,39,99,880 100 — —

2. Housing Development Finance Corporation Limited jointly with its Nominees

120* 0.00 — — — — 0.00

3. Mr. Prosenjit Gupta — — — 20# 0.00 — 0.004. Mr. Dipta Bhanu Gupta — — — 20# 0.00 — 0.005. Mr. Sudhir Kumar Jha — — — 20# 0.00 — 0.006. Mr. Conrad D’Souza — — — 20# 0.00 — 0.007. Mr. Suresh Menon — — — 20# 0.00 — 0.008. Mr. Ajay Agarwal — — — 20# 0.00 — 0.00

Total 3,70,00,000 100 — 13,40,00,000 100 —

* The Shares held by Housing Development Finance Corporation Limited jointly with its nominees were transferred to individual shareholders.# Beneficial owner of these Shares is Housing Development Finance Corporation Limited.

(iii) Change in Promoters’ Shareholding:

Shareholding at the beginning of the year

Cumulative Shareholding during the year

No. of Shares % of Total Shares of the Company

No. of Shares % of Total Shares of the Company

At the beginning of the year 3,70,00,000* 100 — —Rights issue on May 8, 2018 1,00,00,000 N.A. 4,70,00,000 100Rights issue on August 21, 2018 2,00,00,000 N.A. 6,70,00,000 100Rights issue on March 15, 2019 6,70,00,000 N.A. 13,40,00,000 100At the end of the year — — 13,40,00,000# 100

*Includes 120 shares held by Housing Development Finance Corporation Limited jointly with its nominees.#Includes 120 shares held by individuals,however Housing Development Finance Corporation Limited is the beneficial owner.

(iv) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs): Not Applicable



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(v) Shareholding of Directors and Key Managerial Personnel:

Sr. No.

Name Remarks Date Shareholding at the beginning of the year

Cumulative Shareholding during the year

No. of shares

% of total shares of the

company

No. of shares

% of total shares of the

company

1. Mr. Conrad D’Souza At the beginning of the year

April 1, 2018 — — — —

Increase* October 1, 2018 20# 0.00 20# 0.00At the end of the year March 31, 2019 — — 20# 0.00

2. Mr. Sudhir Kumar Jha At the beginning of the year

April 1, 2018 — — — —

Increase* October 1, 2018 20# 0.00 20# 0.00At the end of the year March 31, 2019 — — 20# 0.00

* Transfer from Housing Development Finance Corporation Limited jointly with its Nominees.# Beneficial owner of these Shares is Housing Development Finance Corporation Limited.

V. INDEBTEDNESS Indebtedness of the Company including interest outstanding/accrued but not due for payment:

Particulars Secured Loans excluding Deposits

(`)

Unsecured Loans

(`)

Deposits

(`)

Total Indebtedness

(`)

Indebtedness at the beginning of the financial yeari) Principal Amountii) Interest due but not paidiii) Interest accrued but not due

— — —

63,00,00,000 — —

— — —

63,00,00,000 — —

Total (i+ii+iii) — 63,00,00,000 — 63,00,00,000Change in Indebtedness during the financial yeara) Additionb) Reduction

— —

— 63,00,00,000

— —

— 63,00,00,000

Net Change — (63,00,00,000) — (63,00,00,000)Indebtedness at the end of the financial yeari) Principal Amountii) Interest due but not paidiii) Interest accrued but not due

— — —

— — —

— — —

— — —

Total (i+ii+iii) —- —- —- —-

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL A. Remuneration to Managing Director, Whole-time Directors and/or Manager: Not Applicable


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B. Remuneration to other Directors:Name of Directors Particulars of Remuneration

Fees for attending Board/ Committee

Meetings (`)

Commission

(`)

Others, please specify

(`)

Total Amount

(`)

Mr. Keyur Shah 2,10,000 — — 2,10,000Mr. S. N. Shroff 1,80,000 — — 1,80,000Mr. Conrad D’Souza 1,40,000 — — 1,40,000Mr. V. Srinivasa Rangan 1,20,000 — — 1,20,000Mr. Rajeev Sardana 90,000 — — 90,000Mr. Sudhir Kumar Jha 80,000 — — 80,000Mr. Yogesh Kapur 50,000 — — 50,000Total Managerial Remuneration 8,70,000 — — 8,70,000Overall ceiling as per the Companies Act, 2013 * — — —

* The sitting fees paid to the directors for attending the meetings of the Board of Directors, its Committees and Independent Directors was increased to ` 20,000 from ` 10,000 for meetings held after October 27, 2018.The overall ceiling as per the Companies Act, 2013 for payment of sitting fees for attending each meeting is ` 1 lac.

C. Remuneration to Key Managerial Personnel other than MD/ MANAGER/ WTD:

Sr. No.

Particulars of Remuneration Key Managerial Personnel

Ms. Simrita Ahluwalia (Chief Executive Officer)

(`)

Mr. Ramesh Nayal * (Chief Financial Officer)

(`)

Mr. Lalit V. Jain* (Company Secretary)

(`)

1 Gross salarya) Salary as per provisions contained in Section 17(1) of the Income-tax Act, 1961

20,57,496 — —

b) Value of perquisites under Section 17(2) of the Income-tax Act, 1961

— — —

c) Profits in lieu of salary under Section 17(3) of the Income-tax Act, 1961

— — —

2 Stock Option — — —3 Sweat Equity — — —4 Commission

— as % of profit— Others

—6,80,821

——

——

5 Others – Deputation Cost — 1,44,000 1,20,000Total 27,38,317 1,44,000 1,20,000

*Employees of Housing Development Finance Corporation Limited (HDFC). The Company has paid deputation costs to HDFC as mutually agreed.

VII. PENALTIES/PUNISHMENT/COMPOUNDING OF OFFENCES During the year, no penalties were levied against the Company, its directors or any of its officers under the

Companies Act, 2013, nor was there any punishment or compounding of offences against the Company, its directors or any of its officers.



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Independent Auditors’ Report

To THE MEMBERS OFHDFC EDUCATION AND DEVELOPMENT SERVICES PRIVATE LIMITED

Report on the Audit of the Financial StatementsOpinionWe have audited the accompanying financial statements of HDFC EDUCATION AND DEVELOPMENT SERVICES PRIVATE LIMITED (“the Company”), which comprise the Balance Sheet as at March 31, 2019, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended on that date, and a summary of significant accounting policies and other explanatory information.In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Companies Act, 2013 (“the Act”) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (“Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2019, and its loss, total comprehensive loss, its cash flows and the changes in equity for the year ended on that date.

Basis for OpinionWe conducted our audit of the financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Act (SAs). Our responsibilities under those Standards are further described in the Auditor’s Responsibility for the Audit

of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI’s Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Information Other than the Financial Statements and Auditor’s Report ThereonThe Company’s Board of Directors is responsible for the other information. The other information comprises the information included in the Directors Report’s including Annexures to Directors Report, but does not include financial statements and our auditor’s report thereon.Our op in ion on the financia l statements does not cover the other information and we do not express any form of assurance conclusion thereon.In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Management’s Responsibility for the Financial StatementsThe Company’s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.In preparing the financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting

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Independent Auditors’ Report (Continued)

unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.Those Board of Directors are also responsible for overseeing the Company’s financial reporting process.Auditor’s Responsibility for the Audit of the Financial StatementsOur object ives are to obta in reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.• Obtain an understanding of internal financial control relevant to

the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management.• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s repor t to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.Materiality is the magnitude of misstatements in the financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the financial

statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the financial statements.We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.T h e c o m p a r a t i v e fi n a n c i a l information of the Company for the year ended March 31, 2018 and the related transition date opening balance sheet as at April 1, 2017 included in these financial statements, have been prepared after adjusting previously issued the financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 to comply with Ind AS. The previously issued financial statements were audited by us, whose report for the year ended March 31, 2018 and March 31, 2017 dated April 19, 2018 and May 2, 2017 respectively expressed an unmodified opinion on those financial statements. Adjustments made to the previously issued financial statements to comply with Ind AS have been audited by us.


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Our op in ion on the financia l statements is not modified in respect of this the above matters on the comparative financial information.Report on Other Legal and Regulatory Requirements1. As required by Section 143(3) of the Act, based on our audit we report, to the extent applicable that: a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit. b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books. c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Statement of Cash Flows and Statement of Changes in Equity dealt with by this report are in agreement with the relevant books of account. d) In our opinion, the aforesaid financial statements comply with the Ind AS specified under Section 133 of the Act.

e) On the basis of the written representations received from the directors as on March 31, 2019 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2019 from being appointed as a director in terms of Section 164(2) of the Act. f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure A”. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company’s internal financial controls over financial reporting. g) In our opinion and to the best of our information and according to the explanations given to us, the Company being a private company, section 197 of the Act related to the managerial remuneration not applicable. h) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014,as amended

in our opinion and to the best of our information and according to the explanations given to us:i. The Company does not have any pending litigations which would impact its financial position.ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.2. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the Central Government in terms of Section 143(11) of the Act, we give in “Annexure B” a statement on the matters specified in paragraphs 3 and 4 of the Order.

For DELOITTE HASKINS & SELLS LLPChartered Accountants

(Firm’s Registration No. 117366W/W-100018)

Jitendra AgarwalMay 2, 2019 (Partner)GURUGRAM Membership No. 87104

(Referred to in paragraph 1 (f) under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date)Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)We have audited the internal financial controls over financial reporting of HDFC EDUCATION AND DEVELOPMENT SERVICES PRIVATE LIMITED (“the Company”) as of March 31, 2019 in conjunction with

Annexure 'A' to the Independent Auditors’ Reportour audit of the Ind AS financial statements of the Company for the year ended on that date.Management’s Responsibility for Internal Financial ControlsThe Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the

Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to respective company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

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Annexure 'A' to the Independent Auditors’ Report (Continued)

Auditor’s ResponsibilityOur responsibility is to express an opinion on the Company’s internal financial controls over financial reporting of the Company based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.Our audit involves per forming procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.Meaning of Internal Financial Controls Over Financial ReportingA company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial repor ting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.OpinionIn our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2019, based on internal financial control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.


(Firm’s Registration No.117366W/W-100018)



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(Referred to in paragraph 2 under‘ Report on Other Legal and Regulatory Requirements’ section of our report of even date)(i) (a) T h e C o m p a n y h a s maintained proper records showing full particulars, including quantitative details and situation of fixed assets. (b) The fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification. (c) According to the information and explanations given to us and the records examined by us and based on the examination of the registered conveyance deed provided to us, we report that, the title deeds, comprising all the immovable properties of freehold land, are held in the name of the Company as at the balance sheet date.(ii) Having regard to the nature of the Company’s business / activities, the Company does not have any inventory and hence reporting under clause (ii) of the CARO 2016 is not applicable.(iii) The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013.(iv) The Company has not granted any loans, made investments or provide guarantees and securities and hence reporting under clause (iv) of the CARO 2016 is not applicable.

Annexure 'B' to the Independent Auditors’ Report

(v) According to the information and explanations given to us, the Company has not accepted any deposit during the year. The Company does not have any unclaimed deposits and accordingly the provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 are not applicable to the Company.(vi) Having regard to the nature of the Company’s business / activities, the maintenance of cost records has not been specified by the Central Government under section 148(1) of the Companies Act, 2013.(vii) According to the information and explanations given to us, in respect of statutory dues: (a) T h e C o m p a n y h a s generally been regular in depositing undisputed statutory dues, including Provident Fund, Income-tax, Goods and Services Tax,Cess and other material statutory dues applicable to it with the appropriate authorities. We are informed that provisions of Employees’ State Insurance Act, 1948 are not applicable to the Company and that the operations of the Company did not give rise to any liability for Custom Duty. (b) There were no undisputed amounts payable in respect of Provident Fund, Income-tax, Goods and Service Tax, Cess and other material statutory dues in arrears as at March 31, 2019 for a period of more than six months from the date they became payable. (c) There are no dues of Income-tax and Goods and Services tax as on March 31, 2019 on account of disputes. The operations of the Company did not give rise to any liability for Sales tax, Service Tax, Value Added Tax, Custom Duty, and Excise Duty.

(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to debenture holders. The Company has not taken any loans or borrowing from financial institutions, banks and Government.(ix) The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) or term loans and hence reporting under clause (ix) of the CARO 2016 is not applicable.(x) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company by its officers or employees has been noticed or reported during the year.(xi) The Company is a private Company and hence the provisions of section 197 of the Companies Act, 2013 do not apply to the Company.(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of the CARO 2016 is not applicable.(xiii) In our opinion and according to the information and explanations given to us the Company is in compliance with Sections 177 and 188 of the Companies Act, 2013 where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements etc. as required by the applicable accounting standards.(xiv) During the year the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and hence reporting under clause (xiv) of CARO 2016 is not applicable to the Company.

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(xv) In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its directors or directors of its holding Company or persons connected with

them and hence provisions of section 192 of the Companies Act, 2013 are not applicable.(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.


(Firm’s Registration No.117366W/W-100018)


Annexure 'B' to the Independent Auditors’ Report (Continued)


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Balance Sheet as at 31 March 2019

(Amount in `)Notes As at

31 March 2019As at

31 March 2018As at

1 April 2017ASSETSNon-current assetsProperty, plant and equipment 5 129,416,939 104,626,325 2,446,708Capital work-in-progress 8,028,515 — 47,008,369Investment Property 6 743,270,997 657,463,707 614,961,528Intangible assets 5 1,160,301 1,315,156 —Financial assetsLoans 7 17,925,157 29,727,633 15,240,044Deferred tax asset (net) 8 — — —Other non-current assets 9 9,191,880 12,533,892 9,261,714Total non-current assets 908,993,789 805,666,713 688,918,363Current assetsFinancial assets Trade receivables 10 166,660 119,788 1,473,734 Cash and cash equivalents 11 392,421 1,698,563 769,643 Loans 12 226,993,242 22,500,000 154,000,000Other financial assets 13 1,524,883 85,440 95,218Current tax assets (net) 14 8,662,597 3,525,424 557,121Other current assets 15 15,393,259 8,985,552 5,231,011Total current assets 253,133,062 36,914,767 162,126,727Total assets 1,162,126,851 842,581,480 851,045,090EQUITY AND LIABILITIESEquityEquity share capital 16 1,340,000,000 370,000,000 302,000,000Other equity 17 (199,032,284) (116,642,627) (8,414,550)Total equity 1,140,967,716 253,357,373 293,585,450LiabilitiesNon-current liabilitiesFinancial liabilities Borrowings 18 — 568,850,708 509,809,720Other non-current liabilities 19 4,966,305 3,300,000 —Provisions 20 1,744,761 1,273,657 885,130Total non-current liabilities 6,711,066 573,424,365 510,694,850Current liabilitiesFinancial liabilities Trade payable - Total outstanding dues of micro enterprises and small enterprises — — — - Total outstanding dues of creditors other than micro enterprises

and small enterprises21 3,881,149 4,859,205 3,803,064

Other current liabilities 22 10,406,840 10,821,621 42,859,393Provisions 20 160,080 118,916 102,333Total current liabilities 14,448,069 15,799,742 46,764,790Total liabilities 21,159,135 589,224,107 557,459,640Total equity and liabilities 1,162,126,851 842,581,480 851,045,090Summary of significant accounting policies 1-4The accompanying notes are an integral part of the financial statementsAs per our report of even dateFor Deloitte Haskins & Sells LLP For and on behalf of the Board of DirectorsChartered Accountants

Jitendra Agarwal Keyur Shah Rajeev Sardana Simrita AhluwaliaPartner (DIN: 00332145) (DIN: 06648276) CEOMembership No. 087104 Ramesh Nayal Lalit Jain Chief Financial Officer Company Secretary ICAI M.No. 507968 ICSI M.No. A37005

02 May 2019 02 May 2019Gurugram Delhi

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Statement of Profit and Loss for the year ended 31 March 2019

(Amount in `)

Notes Year ended31 March 2019

Year ended31 March 2018

IncomeRevenue from operations 23 26,512,424 11,056,172Other income 24 34,002,302 18,521,128Total income 60,514,726 29,577,300ExpensesEmployee benefit expenses 25 9,988,387 7,903,757Finance costs 26 61,149,292 59,040,988Depreciation and amortization expenses 27 25,436,481 18,246,194Other expenses 28 41,729,039 47,260,726Total expenses 138,303,199 132,451,665Loss before tax (77,788,473) (102,874,365)Income-tax expenseCurrent tax — —Deferred tax — —Total income-tax expense — —Loss for the year (77,788,473) (102,874,365)Other comprehensive incomeItems that will not be reclassified to profit or loss:(i) Remeasurement of post employment benefit obligations 30 (26,184) (60,712)(ii) Income-tax relating to items that will not be reclassified to profit

or loss— —

Other comprehensive loss for the year (26,184) (60,712)Total other comprehensive loss for the year (77,814,657) (102,935,077)Loss per shareBasic and diluted loss per share (INR) 29 (1.27) (3.30)Summary of significant accounting policies 1-4The accompanying notes are an integral part of the financial statements

As per our report of even dateFor Deloitte Haskins & Sells LLP For and on behalf of the Board of DirectorsChartered Accountants




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Statement of changes in equity for the year ended 31 March 2019

(Amount in `)(A) Equity share capital

Particulars Note No. of shares Amount

Issued, subscribed and fully paid upBalance as at 1 April 2017 @ INR 10 each 16 30,200,000 302,000,000Changes in equity share capital during the year:Issue of equity share capital 6,800,000 68,000,000Balance as at 31 March 2018 @ INR 10 each 16 37,000,000 370,000,000Changes in equity share capital during the year:Issue of equity share capital 97,000,000 970,000,000Balance as at 31 March 2019 @ INR 10 each 16 134,000,000 1,340,000,000

(B) Other equityParticulars Reserves & Surplus Total

Retained earnings

Equity component of debentures

Balance as at 1 April 2017 (171,952,056) 163,537,506 (8,414,550)Loss for the year (102,874,365) — (102,874,365)Other comprehensive loss (60,712) — (60,712)Total comprehensive loss (102,935,077) — (102,935,077)Share issue expense incurred (5,293,000) — (5,293,000)Balance as at 31 March 2018 (280,180,133) 163,537,506 (116,642,627)Loss for the year (77,788,473) — (77,788,473)Other comprehensive loss (26,184) — (26,184)Total comprehensive loss (77,814,657) — (77,814,657)Share issue expense incurred (4,575,000) — (4,575,000)Balance as at 31 March 2019 (362,569,790) 163,537,506 (199,032,284)Summary of significant accounting policies 1-4The accompanying notes are an integral part of the financial statements

As per our report of even dateFor Deloitte Haskins & Sells LLP For and on behalf of the Board of DirectorsChartered Accountants



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Statement of cash flows for the year ended 31 March 2019

(Amount in `)Year ended

31 March 2019Year ended

31 March 2018Cash flow from operating activitiesLoss before tax (77,788,473) (102,874,365)Adjustments for:Depreciation and amortization expenses 25,436,481 18,246,194Interest on deposits (11,922,636) (2,485,197)Interest on refund of income-tax (51,475) —Remeasurement of post retirement benefits (26,184) (60,712)Operating loss before working capital changes (64,352,287) (87,174,080)Changes in working capital(Increase)/decrease in non-current financial liabilities 62,815,597 62,340,988Decrease/ (increase) in non-current financial assets (5,388,191) (18,685,931)(Increase)/decrease in other current assets (3,909,077) (2,285,401)(Increase)/decrease in trade receivables (46,872) 1,353,946Increase/(decrease) in trade payables (978,056) 1,056,141Increase/(decrease) in other current liabilities (2,126,978) (6,904,111)Increase/(decrease) in short-term provisions 41,164 16,583Increase/(decrease) in long-term provisions 471,104 388,527(Increase)/decrease in other non-current assets (504,966) 1,002,797Cash generated from/(used in) operations (13,978,562) (48,890,541)Income-taxes paid (5,137,173) (2,968,303)Net cash generated from/(used in) operating activities (A) (19,115,735) (51,858,844)Cash flow from investing activitiesPurchase of property, plant and equipment and intangible assets (140,650,075) (143,914,211)Inter corporate deposit (187,500,000) 131,500,000Interest received from income-tax refund 51,475 —Interest received on deposits — 479Interest received on inter corporate deposits 10,483,193 2,494,496Net cash generated from/(used in) investing activities (B) (317,615,407) (9,919,236)Cash flow from financing activitiesProceeds from issue of equity shares 970,000,000 68,000,000Share issue expenses (4,575,000) (5,293,000)Redemption of optionally convertible debenture (630,000,000) —Net cash generated from/(used in) financing activities (C) 335,425,000 62,707,000Net increase in cash and cash equivalents (A+B+C) (1,306,142) 928,920Cash and cash equivalents at the beginning of the year 1,698,563 769,643Cash and cash equivalents at the end of the year 392,421 1,698,563Cash and cash equivalents comprise (Refer note 11)Balances with banksOn current accounts 392,421 1,698,563Cash on hand — —Total cash and bank balances at end of the year 392,421 1,698,563Summary of significant accounting policies 1-4 The accompanying notes are an integral part of the financial statementsAs per our report of even dateFor Deloitte Haskins & Sells LLP For and on behalf of the Board of DirectorsChartered Accountants




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Summary of significant accounting policies and other explanatory information for the year ended 31 March 2019

1 Corporate information Nature of operations HDFC Education and Development Services Private Limited (“HEADS”) was incorporated on November 17, 2011

as a Private Limited Company in Mumbai, India. The primary objective of HEADS is to carry on the business of providing services relating to schools, higher education, vocational education and training, supplemental education including but not limited to school management services and school improvement services, providing consultancy and/or expertise on education, building and classroom design and campus management, and to carry on the related pursuits in running educational institutions

General information and statement of compliance with Ind AS As per the press release published by Ministry of Corporate Affairs (“MCA”) on 18 January 2016, Ind AS shall be

mandatorily applicable to every Non Banking Financial Company (“NBFC”) having net worth more than INR 500 crores and to the holding, subsidiary, joint venture or associate companies of such NBFC. The Company is the subsidiary of “Housing Development Finance Corporation Limited” on which Ind AS are applicable from 01 April 2018, hence Ind AS are applicable to the Company.

The financial statements of the Company have been prepared in accordance with Ind AS notified by the Companies (Indian Accounting Standards) Rules, 2015, Companies (Indian Accounting Standards) Amendment Rules, 2016, 2017 and 2018 and Companies (Indian Accounting Standards) Second Amendment Rules, 2018 . Accordingly, the financial statements for the year ended 31 March 2019 are the Company’s first Ind AS financial statements. For periods up to and including the year ended 31 March 2018, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013 (“the Act”), read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (“Indian GAAP”). Refer to note 4 for the explanation of transition from previous GAAP to Ind AS.

The financial statements for the year ended 31 March 2019 were authorized and approved for issue by the Board of Directors on 02 May 2019.

2 Application of new and revised Indian Accounting Standard (Ind AS) All the Ind AS issued and notified by the Ministry of Corporate Affairs under the Companies (Indian Accounting

Standards) Rules, 2015 (as amended) till the financial statements are authorized have been considered in preparing these financial statements.

2.1 Standards issued but not effective I) Ind AS 116, Leases: Ind AS 116, leases was notified on 30 March 2019, which is applicable for the accounting period

beginning from 1 April 2019. Ind AS 116 sets out the principles for the recognition, measurement, presentation and disclosure of leases. The objective of this Ind AS is to ensure that lessees and lessors provide relevant information in a manner that faithfully represents those transactions. This information gives a basis for users of financial statements to assess the effect that leases will have on the financial position, financial performance and cash flows of the entity.

The new lease standard is applicable to the Company from 1 April 2019. The Company is in the process of evaluating the requirement of standard.

According to Ind AS 116, lessor accounting are substantially similar to accounting requirements contained in Ind AS 17. Accordingly, a lessor will continue to classify its leases as operating leases or finance leases, and to account for those two types of leases differently.

Ind AS 116 contains additional disclosure requirements for lessors as compared to Ind AS 17, such as, disclosure of maturity analysis of lease payments; quantitative and qualitative explanation of significant changes in carrying amount of new investment in finance leases etc.

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Summary of significant accounting policies and other explanatory information for the year ended 31 March 2019 (Continued)

3 Summary of Significant accounting policies 3.01 Overall Consideration The financial statements have been prepared using the significant accounting policies and measurement

bases summarized below. These were used throughout all periods presented in the financial statements, except where the Company has applied certain accounting policies and exemptions upon transition to Ind AS.

Basis of Preparation of Financial Statements The financial statements have been prepared on a going concern and accrual basis under the historical

cost basis. 3.02 Current versus non-current classification All assets and liabilities have been classified as current or non-current as per the Company’s operating

cycle and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current – non-current classification of assets and liabilities.

3.03 Revenue recognition - Service Contracts Ind AS 115 “Revenue from contracts with customers”, introduces a new framework of five step model for

the analysis of revenue transactions. The model specifies that revenue should be recognised when (or as) an entity transfer control of goods or services to a customer at the amount to which the entity expects to be entitled. Further the new standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts with customers.

The standard permits two possible methods of transition: i. Retrospective approach - Under this approach the standard will be applied retrospectively to each prior

reporting period presented in accordance with Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors

ii. Retrospectively with cumulative effect of initially applying the standard recognized at the date of initial application (cumulative catch - up approach)

As per Ind AS 115, the Company has identifiable contracts entered between the Company and the Trusts (“3E Education Trust” and “Maharashtra 3E Education Trust”). As per the current practice being followed by the Company, the Company is charging a sum of 14% (In case of 3E Education Trust) and 18% (In case of Maharashtra 3E Education Trust), based on the Gross revenue (non-refundable fees/other charges) generated by the schools for each academic year, for the services provided by the Company.

In accordance with Ind AS 115, the Company has identifiable performance obligations to these trusts which are being delivered to the trusts as and when needed on continuous basis for each academic session. The nature of performance obligation is setup in the manner which covers the academic session and based on that, revenue is being recognized periodically for each academic session.

In accordance with the transition methods given in Ind AS 115, the Company opted to apply the standard retrospectively with cumulative effect of initially applying the standard recognized at the date of initial application.

Revenue recognition - Letting out of property Revenue from letting out of property is recognized on accrual basis. Interest Interest income from deposits and income-tax is recognized on a time proportion basis by reference to the

principal outstanding and at the interest rate applicable. Interest income from a financial asset is recognised when it is probable that the economic benefits will flow

to Company and the amount of income can be measured reliably. Interest income is included under the head “other income” in the statement of profit and loss.


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3.04 Property, plant and equipment Recognition and initial measurement Property, plant and equipment are stated at their cost of acquisition less accumulated depreciation and

impairment losses, if any. The cost comprises purchase price net of any trade discounts and rebates, and other taxes (other than those subsequently recoverable from the tax authorities), any directly attributable expenditure on making the asset ready for its intended use, other incidental expenses up to the date the asset is ready for its intended use.

Subsequent expenditure on fixed assets after its purchase / completion is capitalized only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance. All other repairs and maintenance are charged to Statement of Profit and Loss during the year in which they are incurred.

Subsequent measurement (depreciation and useful lives) Depreciation has been provided on the straight-line method as per the useful life prescribed in Schedule

II to the Companies Act, 2013 except in respect of Computers and data processing equipment which are depreciated over 4 years in whose case the life of the assets has been assessed as 4 years based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers warranties and maintenance support, etc.

The estimate of useful lives of fixed assets followed by the Company in preparing the financial statements is as follows:Assets Category Useful LifePlant & Machinery 15 yearsOffice equipment / Electrical Installation and Equipments 5 years / 10 yearsFurniture and fixtures 8 yearsComputers 4 yearsBuilding 3 years to 40 years

De-recognition An item of property, plant and equipment and any significant part initially recognized is derecognized upon

disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on de-recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the income statement when the asset is derecognized.

Transition to Ind AS On transition to Ind AS, the Company has elected to continue with the carrying value of all of its property,

plant and equipment recognized as at 1 April 2017 measured as per the Indian GAAP and use that carrying value as the deemed cost of the property, plant and equipment.

3.05 Intangible Assets Intangible assets are stated at acquisition cost, net of accumulated amortization and impairment losses

(if any). Transition to Ind AS On transition to Ind AS, the Company has elected to continue with the carrying value of all of its all intangible

assets recognized as at 1 April 2017 measured as per the Indian GAAP and use that carrying value as the deemed cost of the intangible assets.

The Company amortized intangible assets over their estimated useful lives using the straight line method. The estimated useful lives of intangible assets are as follows:

Intangible assets Useful LifeComputer Software 1 year to 4 years

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Intangible assets with finite lives are assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period and the amortization method for an intangible asset with a finite useful life are reviewed at least at each financial year end.

3.06 Investment Property Investment property is stated at cost. However, as per Ind AS 40, there is a requirement to disclose fair

value as at the balance sheet date. The Group engaged independent valuation specialists to determine the fair value of its investment property as at reporting date The determination of the fair value of investment properties requires the use of estimates such as future cash flows from the assets (such as lettings, future revenue streams, capital values of fixtures and fittings, any environmental matters and the overall repair and condition of the property) and discount rates applicable to those assets. In addition, development risks (such as construction and letting risk) are also taken into consideration when determining the fair value of the properties under construction. These estimates are based on local market conditions existing at the balance sheet date.

Subsequent measurement (depreciation and useful lives) Investment properties are subsequently measured at cost less accumulated depreciation and impairment

losses. Depreciation on investment properties is provided on the straight-line method, computed on the basis of useful lives (as set-out below) prescribed in Schedule II to the Act:

Assets Category Useful LifeLand InfiniteBuilding 3 years to 40 years

Transition to Ind AS On transition to Ind AS, the Company has elected to continue with the carrying value of all of its investment

property recognized as at 1 April 2017 measured as per the Indian GAAP and use that carrying value as the deemed cost of the investment property.

3.07 Leases Operating leases Company as a lessee Assets acquired on leases where a significant portion of risk and rewards of ownership are retained by the

lessor are classified as operating leases. Lease rental are charged to statement of profit and loss on straight line basis except where scheduled increase in rent compensate the lessor for expected inflationary costs.

Company as a lessor Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest

with the lessor are recognized as operating lease. Lease rentals under operating leases are recognized in the Statement of Profit and Loss as per the lease rentals specified in the agreement with parties.

3.08 Impairment of non-financial assets At each reporting date, the Company assesses whether there is any indication based on internal/external

factors, that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount and the reduction is treated as an impairment loss and is recognized in the statement of profit and loss. All assets are subsequently reassessed for indications that an impairment loss previously recognized may no longer exist. An impairment loss is reversed if the asset’s or cash-generating unit’s recoverable amount exceeds its carrying amount.


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3.09 Financial instruments Financial assets Initial recognition and measurement Financial assets and financial liabilities are recognized when the Company becomes a party to the contractual

provisions of the financial instrument and are measured initially at fair value adjusted for transaction costs Subsequent measurement Financial instruments at amortized cost – the financial instrument is measured at the amortized cost if

both the following conditions are met: • The asset is held within a business model whose objective is to hold assets for collecting contractual

cash flows, and • Contractual terms of the asset give rise on specified dates to cash flows that are solely payments of

principal and interest (“SPPI”) on the principal amount outstanding. After initial measurement, such financial assets are subsequently measured at amortized cost using the effective interest rate (“EIR”) method. All the debt instruments of the Company are measured at amortized cost.

De-recognition of financial assets A financial asset is primarily de-recognized when the rights to receive cash flows from the asset have

expired or the Company has transferred its rights to receive cash flows from the asset. On derecognition of a financial asset in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognised in other comprehensive income and accumulated in equity is recognised in profit or loss if such gain or loss would have otherwise been recognised in profit or loss on disposal of that financial asset.

Financial liabilities Initial recognition and measurement All financial liabilities are recognized initially at fair value and transaction cost that is attributable to the

acquisition of the financial liabilities is also adjusted. These liabilities are classified as amortized cost. Subsequent measurement Subsequent to initial recognition, these liabilities are measured at amortized cost using the effective interest

method. These liabilities include borrowings. De-recognition of financial liabilities A financial liability is de-recognized when the obligation under the liability is discharged or cancelled or expires.

When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the statement of profit and loss.

Compound financial instrument Compound financial instrument are separated into liability and equity components based on the terms of

the contract. On issuance of the said instrument, the liability component is arrived by discounting the gross sum at a market rate for an equivalent non-convertible instrument. This amount is classified as a financial liability measured at amortized cost until it is extinguished on conversion or redemption. The remainder of the proceeds is recognized as equity component of compound financial instrument. This is recognized and included in shareholders’ equity, net of Income-tax effects, and not subsequently re-measured.

Offsetting of financial instruments Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if

there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously.


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3.10 Impairment of financial assets In accordance with Ind AS 109, the Company applies expected credit loss (“ECL”) model for measurement

and recognition of impairment loss for financial assets. ECL is the difference between all contractual cash flows that are due to the Company in accordance with

the contract and all the cash flows that the Company expects to receive. When estimating the cash flows, the Company is required to consider -

• All contractual terms of the financial assets (including prepayment and extension) over the expected life of the assets.

• Cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.

Trade receivables The Company applies approach permitted by Ind AS 109, financial instruments, which requires expected

lifetime losses to be recognized from initial recognition of receivables. Other financial assets For recognition of impairment loss on other financial assets and risk exposure, the Company determines

whether there has been a significant increase in the credit risk since initial recognition and if credit risk has increased significantly, impairment loss is provided.

3.11 Income-taxes Tax expense recognized in statement of profit and loss comprises the sum of deferred tax and current tax,

not recognized in Other Comprehensive Income (“OCI”) or directly in equity. Current income-tax is measured at the amount expected to be paid to the tax authorities in accordance

with the Indian Income-tax Act. Current income-tax relating to items recognized outside statement of profit and loss is recognized outside statement of profit and loss (either in OCI or in equity).

Deferred tax is recognized in respect of temporary differences between carrying amount of assets and liabilities for financial reporting purposes and corresponding amount used for taxation purposes. Deferred tax assets are recognized to the extent that it is probable that the underlying tax loss, unused tax credits or deductible temporary difference will be utilized against future taxable income. This is assessed based on the Company’s forecast of future operating results, adjusted for significant non-taxable income and expenses and specific limits on the use of any unused tax loss or credit.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date. Deferred tax relating to items recognized outside statement of profit and loss is recognized outside statement of profit and loss (either in OCI or in equity).

3.12 Cash and bank balances Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances

(with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of change in value.

3.13 Post-employment, long term and short term employee benefits Long-term employee benefits Payments to defined contribution retirement benefit plans are recognised as an expense when employees

have rendered service entitling them to the contributions. Contribution towards Provident Fund is paid as per the statutory provisions. These benefits are charged

to the statement of profit and loss of the year when they become due. For defined post employment employee benefit plans, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. Remeasurement,



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comprising actuarial gains and losses, the effect of the changes to the return on plan assets (excluding net interest), is reflected immediately in the balance sheet with a charge or credit recognised in other comprehensive income in the period in which they occur. Past service cost is recognised in the statement of profit and loss in the period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorised as follows:

i) service cost (including current service cost, past service cost, as well as gains and losses on curtailments and settlements);

ii) net interest expense or income; and iii) remeasurement Short-term employee benefits The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services

rendered by employees are recognized during the year when the employees render the service. These benefits include performance incentive which is expected to be paid within twelve months after the end of the period in which the employee renders the related service.

Compensated Absences The leave obligations cover the Company’s liability for earned leaves. The Company does not have an

unconditional right to defer settlement for the obligation shown as current provision balance above. However, based on past experience, the Company does not expect all employees to take the full amount of accrued leave or require payment within the next 12 months, therefore, based on the independent actuarial report, only a certain amount of provision has been presented as current and balance as non-current.

Leave Travel Allowance The leave travel obligations cover the Company’s liability for employees travel. The Company does not have

an unconditional right to defer settlement for the obligation shown as current provision balance above. However, based on past experience, the Company does not expect all employees to take the full amount of accrued leave travel allowance or require payment within the next 12 months, therefore, based on the independent actuarial report, only a certain amount of provision has been presented as current and balance as non-current.

3.14 Provisions, Contingent Liabilities and Contingent Assets A provision is recognized when the Company has a present obligation as a result of past events and it is

probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities, if any, are disclosed in the Notes. Contingent assets are not recognized in the financial statements.

3.15 Earning Per Share Basic earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect

of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect of extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income (net of any attributable taxes) relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease the net profit per share from continuing ordinary operations. Potential dilutive equity shares are


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deemed to be converted as at the beginning of the period, unless they have been issued at a later date. The dilutive potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value (i.e. average market value of the outstanding shares). Dilutive potential equity shares are determined independently for each period presented. The number of equity shares and potentially dilutive equity shares are adjusted for share splits / reverse share splits and bonus shares, as appropriate.

3.16 Significant management judgement in applying accounting policies and estimation uncertainty The preparation of the Company’s financial statements requires management to make judgements, estimates

and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the related disclosures.

Significant management judgements and estimates The following are significant management judgements and estimates in applying the accounting policies

of the Company that have the most significant effect on the financial statements. Evaluation of indicators for impairment of assets The evaluation of applicability of indicators of impairment of assets requires assessment of several external

and internal factors which could result in deterioration of recoverable amount of the assets. Classification of leases The Company enters into leasing arrangements for various assets. The classification of the leasing

arrangement as a finance lease or operating lease is based on an assessment of several factors, including, but not limited to, transfer of ownership of leased asset at end of lease term, lessee’s option to purchase and estimated certainty of exercise of such option, proportion of lease term to the asset’s economic life, proportion of present value of minimum lease payments to fair value of leased asset and extent of specialized nature of the leased asset.

Recoverability of advances/receivables At each balance sheet date, based on historical default rates observed over expected life, the management

assesses the expected credit loss on outstanding receivables and advances. Defined benefit obligation (“DBO”) Management’s estimate of the DBO is based on a number of critical underlying assumptions such as

standard rates of inflation, medical cost trends, mortality, discount rate and anticipation of future salary increases. Variation in these assumptions may significantly impact the DBO amount and the annual defined benefit expenses.

Fair value measurements Management applies valuation techniques to determine the fair value of financial instruments (where active

market quotes are not available). This involves developing estimates and assumptions consistent with how market participants would price the instrument. Management uses the best information available. Estimated fair values may vary from the actual prices that would be achieved in an arm’s length transaction at the reporting date.

Useful lives of depreciable/amortizable assets Management reviews its estimate of the useful lives of depreciable/amortizable assets at each reporting

date, based on the expected utility of the assets. Uncertainties in these estimates relate to technical and economic obsolescence.

Evaluation of Revenue recognition under Ind AS 115 The Management of the Company estimates that the identifiable performance obligations to the trusts are

setup in such a manner which covers the academic session and based on that, revenue is being recognized periodically for each academic session.



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4 First-time adoption of Ind-AS These financial statements, for the year ended 31 March 2019, are the first financial statements prepared by

the Company in accordance with Ind AS. For periods up to and including the year ended 31 March 2018, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (‘Indian GAAP’ or ‘Previous GAAP’).

Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for periods ending on 31 March 2019, together with the comparative period data as at and for the year ended 31 March 2018, as described in the summary of significant accounting policies. In preparing these financial statements, the Company’s opening Ind AS balance sheet was prepared as at 1 April 2017, the Company’s date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its Previous GAAP financial statements, including the balance sheet as at 1 April 2017 and the financial statements as at and for the year ended 31 March 2018.

The Company has applied Ind AS 101 in preparing these first financial statements. The effect of transition to Ind AS on equity, total comprehensive income and reported cash flows are presented in this section and are further explained in the notes accompanying the tables.

A Exemptions and exceptions availed Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the

transition from Previous GAAP to Ind AS. A.1 Ind AS optional exemptions: A1.1 Deemed cost for property, plant and equipment, intangible assets and investment property Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property,

plant and equipment, intangible assets and investment property as recognized in the financial statements as at the date of transition to Ind AS, measured as per the Previous GAAP and use that as its deemed cost as at the date of transition. Accordingly, the Company has elected to measure all of its property, plant and equipment, intangible assets and investment property at their Previous GAAP carrying value.

A1.2 Leases Ind AS 101 allows the first time adopter to determine whether an arrangement existing at the date of

transition to Ind AS contains a lease on the basis of facts and circumstances existing at the date of transition to Ind AS. Accordingly the company has opted to apply this exemption for the arrangement of lease at the date of transition.

A.2 Ind AS mandatory exceptions: A2.1 Estimates An entity’s estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent

with estimates made for the same date in accordance with Previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

Ind AS estimates as at 1 April 2017 are consistent with the estimates as at the same date made in conformity with Previous GAAP. Information about estimates and assumptions that have the most significant effect on recognition and measurement of assets, liabilities, income and expenses is provided below.

a) Impairment of financial assets At each balance sheet date, based on historical default rates observed over expected life, the

management assesses the expected credit loss on outstanding receivables and advances.


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b) Defined benefit obligation (“DBO”) Management’s estimate of the DBO is based on a number of critical underlying assumptions such

as standard rates of inflation, medical cost trends, mortality, discount rate and anticipation of future salary increases. Variation in these assumptions may significantly impact the DBO amount and the annual defined benefit expenses.

c) Fair value measurements Management applies valuation techniques to determine the fair value of financial instruments (where

active market quotes are not available). This involves developing estimates and assumptions consistent with how market participants would price the instrument.

d) Useful lives of depreciable/ amortisable assets Management reviews its estimate of the useful lives of depreciable/amortisable assets at each

reporting date, based on the expected utility of the assets. Uncertainties in these estimates relate to technical and economic obsolescence that may change the utility of certain software, customer relationships, IT equipment and other plant and equipment.

e) Valuation of investment property Investment property is stated at cost. However, as per Ind AS 40 there is a requirement to disclose fair

value as at the balance sheet date. The Group engaged independent valuation specialists to determine the fair value of its investment property as at reporting date. The determination of the fair value of investment properties requires the use of estimates such as future cash flows from the assets (such as lettings, future revenue streams, capital values of fixtures and fittings, any environmental matters and the overall repair and condition of the property) and discount rates applicable to those assets. In addition, development risks (such as construction and letting risk) are also taken into consideration when determining the fair value of the properties under construction. These estimates are based on local market conditions existing at the balance sheet date.

A2.2 Classification and measurement of financial assets The classification and measurement of financial assets will be made considering whether the conditions

as per Ind AS 109 are met based on facts and circumstances existing at the date of transition. Financial assets can be measured using effective interest method by assessing its contractual cash

flow characteristics only on the basis of facts and circumstances existing at the date of transition and if it is impracticable to assess elements of modified time value of money, i.e., the use of effective interest method, fair value of financial asset at the date of transition shall be the new carrying amount of that asset. The measurement exemption applies for financial liabilities as well.

Applying a requirement is impracticable when the entity cannot apply it after making every reasonable effort to do so. It is impracticable to apply the changes retrospectively if:

a) The effects of the retrospective application are not determinable; b) The retrospective application requires assumptions about what management’s intent would

have been in that period; c) The retrospective application requires significant estimates of amounts and it is impossible to

distinguish objectively information about those estimates that existed at that time. A2.3 De-recognition of financial assets and liabilities Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively

for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the derecognition requirements in Ind AS 109 retrospectively from a date of the entity’s choice, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognized as a result of past transactions was obtained at the time of initially accounting for those transactions.

The Company has elected to apply the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.



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(Amount in `)

B Reconciliation between Previous GAAP and Ind AS Ind AS 101, First time adoption of Indian Accounting Standards, requires an entity to reconcile equity, total

comprehensive income and cash flows for prior periods. The following tables represent the reconciliations from previous GAAP to Ind AS.

(a) Effect of Ind AS adoption on the balance sheet as at 1 April 2017

Notes Previous GAAP* Adjustments Ind AS

ASSETSNon-current assetsProperty, plant and equipment (i) 403,696,708 (401,250,000) 2,446,708Capital work-in-progress (ii) 260,719,897 (213,711,528) 47,008,369Investment Property (i), (ii) — 614,961,528 614,961,528Financial assetsLoans (ix) 26,040,000 (10,799,956) 15,240,044Deferred tax asset (net) (x) 203,532 (203,532) —Other non-current assets (ix) — 9,261,714 9,261,714Total non-current assets 690,660,137 (1,741,774) 688,918,363Current assetsFinancial assetsTrade receivables 1,473,734 — 1,473,734Cash and cash equivalents 769,643 — 769,643Loans (iii),(ix) 158,423,087 (4,423,087) 154,000,000Other financial assets (ix) — 95,218 95,218Current tax assets (net) (iii) — 557,121 557,121Other current assets (iii) 95,218 5,135,793 5,231,011Total current assets 160,761,682 1,365,045 162,126,727Total assets 851,421,819 (376,729) 851,045,090EQUITY AND LIABILITIESEquityEquity share capital 302,000,000 — 302,000,000Other equity (vii),(ix) (128,228,101) 119,813,551 (8,414,550)Total equity 173,771,899 119,813,551 293,585,450LiabilitiesNon-current liabilitiesFinancial liabilitiesBorrowings (vi) 630,000,000 (120,190,280) 509,809,720Loans — — —Deferred tax liability (net) (x) — — —Provisions 885,130 — 885,130Total non-current liabilities 630,885,130 (120,190,280) 510,694,850


1121

M1121 K1121

M1121 K1121



Current liabilitiesFinancial liabilitiesTrade payables- Total outstanding dues of micro enterprises

and small enterprises— — —

- Total outstanding dues of creditors other than micro enterprises and small enterprises

3,803,064 — 3,803,064

Other current liabilities 42,859,393 — 42,859,393Provisions 102,333 — 102,333Total current liabilities 46,764,790 — 46,764,790Total liabilities 677,649,920 (120,190,280) 557,459,640Total equity and liabilities 851,421,819 (376,729) 851,045,090

* The Previous GAAP figures have been reclassified to conform to Ind AS presentation requirements for the purpose of this note.

(b) Effect of Ind AS adoption on the balance sheet as at 31 March 2018Notes Previous GAAP* Adjustments Ind AS

ASSETSNon-current assetsProperty, plant and equipment (i) 759,415,907 (654,789,582) 104,626,325Capital work-in-progress (ii) 2,674,125 (2,674,125) —Investment Property (i),(ii) — 657,463,707 657,463,707Intangible assets 1,315,156 — 1,315,156Financial assetsLoans (ix) 45,085,773 (15,358,140) 29,727,633Deferred tax asset (net) (x) 283,546 (283,546) —Other non-current assets (ix) — 12,533,892 12,533,892Total non-current assets 808,774,507 (3,107,794) 805,666,713Current assetsFinancial assetsTrade receivables 119,788 — 119,788Cash and cash equivalents 1,698,563 — 1,698,563Loans (iii),(ix) 32,643,134 (10,143,134) 22,500,000Other financial assets (ix) — 85,440 85,440Current tax assets (net) (iii) — 3,525,424 3,525,424Other current assets (iii) 85,440 8,900,112 8,985,552Total current assets 34,546,925 2,367,842 36,914,767Total assets 843,321,432 (739,952) 842,581,480


(Amount in `)


1122

M1122 K1122

M1122 K1122


EQUITY AND LIABILITIESEquityEquity share capital 370,000,000 — 370,000,000Other equity (vii),(ix) (177,051,967) 60,409,340 (116,642,627)Total equity 192,948,033 60,409,340 253,357,373LiabilitiesNon-current liabilitiesFinancial liabilitiesBorrowings (vi) 630,000,000 (61,149,292) 568,850,708Loans 3,300,000 — 3,300,000Deferred tax liability (net) (x) — — —Provisions 1,273,657 — 1,273,657Total non-current liabilities 634,573,657 (61,149,292) 573,424,365Current liabilitiesFinancial liabilitiesTrade payables- Total outstanding dues of micro enterprises

and small enterprises— — —

- Total outstanding dues of creditors other than micro enterprises and small enterprises

4,859,205 — 4,859,205

Other current liabilities 10,821,621 — 10,821,621Provisions 118,916 — 118,916Total current liabilities 15,799,742 — 15,799,742Total liabilities 650,373,399 (61,149,292) 589,224,107Total equity and liabilities 843,321,432 (739,952) 842,581,480

* The Previous GAAP figures have been reclassified to conform to Ind AS presentation requirements for the purpose of this note.

(c) Reconciliation of total comprehensive income for the year ended 31 March 2018Notes Indian GAAP* Adjustments Ind AS

IncomeRevenue from operations (iv) 25,906,172 (14,850,000) 11,056,172Other income (iv),(ix) 2,485,197 16,035,931 18,521,128Total income 28,391,369 1,185,931 29,577,300ExpensesEmployee benefit expense (v) 7,964,469 (60,712) 7,903,757Finance costs (vi),(ix) — 59,040,988 59,040,988Depreciation and amortization expense 18,246,194 — 18,246,194Other expenses (vii),(ix) 51,084,586 (3,823,860) 47,260,726Total expenses 77,295,249 55,156,416 132,451,665


(Amount in `)

1123

M1123 K1123

M1123 K1123


Notes Indian GAAP* Adjustments Ind AS

Loss before tax (48,903,880) (53,970,485) (102,874,365)Income-tax expenseCurrent Tax — — —Deferred tax (x) (80,014) 80,014 —Total income-tax expense (80,014) 80,014 —Loss for the year (48,823,866) (54,050,499) (102,874,365)Other comprehensive incomeItems that will not be reclassified to profit or (loss):(i) Remeasurement of post employment benefit

obligations profit or (loss)(v) — (60,712) (60,712)

(ii) Income-tax relating to items that will not be reclassified to profit or (loss)

(x)— — —

Other comprehensive loss for the year — (60,712) (60,712)Total other comprehensive loss for the year (48,823,866) (54,111,211) (102,935,077)

* The Indian GAAP figures have been reclassified to conform to Ind AS presentation requirements for the purpose of this note.

(d) Reconciliation of equity between Ind AS and previous Indian GAAP: Notes As at

31 March 2018As at

1 April 2017

Equity as per previous Indian GAAP 192,948,033 173,771,899Ind AS: Adjustments increase/(decrease):Financial assets and liabilities at amortised cost (ix) (102,844,620) (43,520,423)Equity Portion of Optionally Convertible Debenture (vi) 163,537,506 163,537,506Reversal of Deferred Tax Assets (x) (283,546) (203,532)

60,409,340 119,813,551Equity as per Ind AS 253,357,373 293,585,450

(e) Reconciliation of statement of cash flows between Ind AS and previous Indian GAAP:

Note Previous GAAP Adjustments Ind AS

Net cash flow from operating activities (viii) (51,858,844) — (51,858,844)Net cash flow from investing activities (viii) (9,919,236) — (9,919,236)Net cash flow from financing activities (viii) 62,707,000 — 62,707,000Net increase / (decrease) in cash and cash equivalents 928,920 — 928,920Cash and cash equivalents as at 1 April 2017 (viii) 769,643 — 769,643Cash and cash equivalents as at 31 March 2018 1,698,563 — 1,698,563

(f) Notes to Reconciliation (i) Land and building earlier grouped under property, plant and equipment is re-grouped to investment property

because as per Ind AS 40, property held to earn rental income is to be grouped under investment property. (ii) There was no distinction between capital work in progress in the previous GAAP, however as per the Ind AS,

capital work in progress relating to land and building has been grouped under schedule of investment property.


(Amount in `)


1124

M1124 K1124

M1124 K1124

(iii) TDS and advance tax receivable grouped under other current assets is re-grouped to current tax assets because the amount pertaining to taxes is to be grouped under current tax assets and balance with government authority grouped under short-term loans and advances is re-grouped to other current assets.

(iv) Rental income from lease of premises shown as a part of revenue from operations is re-grouped to other income. (v) As per Ind AS 19, employee benefits, actuarial gains and losses are recognized in other comprehensive

income and not reclassified to profit and loss in a subsequent period. Also, the tax component on actuarial gains and losses has been transferred to other comprehensive income under Ind AS.

(vi) As per Ind AS 109, optionally convertible debentures have been amortised using the market rate of interest and the notional interest cost on the same has been shown as finance cost in the statement of profit and loss.

(vii) As per para 35 of Ind AS-32, transaction costs of an equity transaction shall be accounted for as a deduction from equity, net of any related income tax benefit. Accordingly the share issue expenses which were grouped under rates and taxes under previous GAAP has been re-grouped under the head retained earnings in “Other Equity”.

(viii) There is no impact of Ind AS adoption on the statements of cash flows for the year ended 31 March 2017. (ix) Under Ind AS 109, certain financial assets and financial liabilities are initially recognised at fair value and

subsequently measured at amortised cost which involves the application of effective interest method. The effective interest rate is the rate that discounts estimated future cash payments or receipts through the expected life of the financial asset or financial liability to the gross carrying amount of the financial asset or financial liability. For certain financial assets and financial liabilities, the fair value thereof at the date of transition to Ind AS has been considered as the new amortised cost of that financial asset and financial liability at the date of transition to Ind AS. The application of effective interest method results in adjustment to carrying amount of loans, other financial assets, borrowing and other financial liabilities. Earlier the financial assets and financial liabilities were typically carried at the contractual amount receivable or payable.

(x) Under Previous GAAP, deferred tax was accounted as per the income statement approach which required creation of deferred tax asset/ liability on timing differences between taxable income and accounting income. Under Ind AS, deferred tax is accounted as per the Balance Sheet approach which requires creation of deferred tax asset/ liability on temporary differences between the carrying amount of an asset/ liability in the balance sheet and its corresponding tax base. The management has taken a conservative view and have restricted the deferred tax assets upto the deferred tax component of Unabsorbed Depreciation and Brought forward Business Losses.


1125

M1125 K1125

M1125 K1125


5 Property, plant and equipment and intangible assets (Amount in `)

Property, plant and equipmentParticulars Plant &

machineryOffice

equipmentFurniture and

fixturesComputers Total

Gross blockDeemed cost as at 1 April 2017 485,578 666,923 863,996 430,211 2,446,708Additions 17,105,979 51,915,820 35,805,713 8,166,156 112,993,668Disposals — — — — —Balance as at 31 March 2018 17,591,557 52,582,743 36,669,709 8,596,367 115,440,376Additions 272,072 11,553,152 23,272,396 7,172,662 42,270,282Disposals — — — — —Balance as at 31 March 2019 17,863,629 64,135,895 59,942,105 15,769,029 157,710,658Accumulated depreciation:Depreciation charge for the year 1,016,837 4,654,472 3,609,305 1,533,437 10,814,051Reversal on disposals — — — — —Balance as at 31 March 2018 1,016,837 4,654,472 3,609,305 1,533,437 10,814,051Depreciation charge for the year 1,190,184 7,061,706 6,147,107 3,080,671 17,479,668Reversal on disposals — — — — —Balance as at 31 March 2019 2,207,021 11,716,178 9,756,412 4,614,108 28,293,719Net block:Balance as at 1 April 2017 485,578 666,923 863,996 430,211 2,446,708Balance as at 31 March 2018 16,574,720 47,928,271 33,060,404 7,062,930 104,626,325Balance as at 31 March 2019 15,656,608 52,419,717 50,185,693 11,154,921 129,416,939

Intangible AssetsParticulars Computer Software Total

Gross blockDeemed cost as at 1 April 2017 — —Additions 1,791,622 1,791,622Disposals — —Balance as at 31 March 2018 1,791,622 1,791,622Additions 497,940 497,940Disposals — —Balance as at 31 March 2019 2,289,562 2,289,562Accumulated depreciationDepreciation charge for the year 476,466 476,466Reversal on disposals — —Balance as at 31 March 2018 476,466 476,466Depreciation charge for the year 652,795 652,795Reversal on disposals — —Balance as at 31 March 2019 1,129,261 1,129,261Net block:Balance as at 1 April 2017 — —Balance as at 31 March 2018 1,315,156 1,315,156Balance as at 31 March 2019 1,160,301 1,160,301

Notes forming part of the Financial Statements for the year ended 31 March 2019


1126

M1126 K1126

M1126 K1126

6 Investment Property Particulars Land Building Sub-total (A) Capital Work in

Progress (B)Total (A+B)

Gross blockCarrying value as at 1 April 2017 401,250,000 — 401,250,000 213,711,528 614,961,528Additions — 260,495,259 260,495,259 33,990,509 294,485,768Disposals — — — 245,027,912 245,027,912Balance as at 31 March 2018 401,250,000 260,495,259 661,745,259 2,674,125 664,419,384Additions — 2,731,852 2,731,852 90,379,456 93,111,308Disposals — — — — —Balance as at 31 March 2019 401,250,000 263,227,111 664,477,111 93,053,581 757,530,692Accumulated depreciation:Depreciation charge for the year — 6,955,677 6,955,677 — 6,955,677Reversal on disposals — — — — —Balance as at 31 March 2018 — 6,955,677 6,955,677 — 6,955,677Depreciation charge for the year — 7,304,018 7,304,018 — 7,304,018Reversal on disposals — — — — —Balance as at 31 March 2019 — 14,259,695 14,259,695 — 14,259,695Net block:Balance as at 1 April 2017 401,250,000 — 401,250,000 213,711,528 614,961,528Balance as at 31 March 2018 401,250,000 253,539,582 654,789,582 2,674,125 657,463,707Balance as at 31 March 2019 401,250,000 248,967,416 650,217,416 93,053,581 743,270,997

6A Amount recognized in statement of profit and loss for investment properties

Particulars 31 March 2019 31 March 2018

Rental Income (refer to note 24) (A) 19,800,000 14,850,000Less: Direct operating expenses that did not generate rental income (B) — —Less: Direct operating expenses that generated rental income(a) Repairs and maintenance - building 1,017,248 151,268(b) Rates and taxes 302,789 322,511(c) Legal and professional charges 229,500 50,150(d) Electricity and water — 416,926(e) Miscellaneous expenses 52,061 22,497Total direct operating expenses that generated rental income (C) 1,601,598 963,352Profit from leasing of investment properties after depreciation (A-B-C) 18,198,402 13,886,648Less: Depreciation expense 7,304,018 6,955,677Profit from leasing of investment properties after depreciation 10,894,384 6,930,971

6B Leasing arrangements All of the Investment properties are leased to tenants under long-term operating leases with rentals payable monthly.

Notes forming part of the Financial Statements for the year ended 31 March 2019 (Continued)

(Amount in `)

1127

M1127 K1127

M1127 K1127


6C Fair Value Fair value hierarchy and valuation technique The fair value of investment property has been determined by external, independent property valuers, having

appropriate recognized professional qualification and recent experience in the location and category of the property being valued. The Company obtains independent valuations for its investment properties annually and fair value measurement has been categorised as Level 3. Fair values of the building is arrived using sales comparable method and the fair value of land appurtenant thereto has been estimated using cost method. Based on the statistics of such valuation report, the management considered carrying value of its investment property aggregating INR 77,45,00,000 (31 March 2018: INR 77,15,00,000 and 1 April 2017: INR 67,10,00,000) to be a reasonable estimate of its fair value.

7 Non Current Financial assets - Loans (Amount in `)

As at 31 March 2019

As at 31 March 2018

As at 1 April 2017

Unsecured and considered goodSecurity deposit 17,925,157 29,727,633 15,240,044Total 17,925,157 29,727,633 15,240,044

8 Deferred tax assets / (liabilities) (net) Unrecognised deductible temporary differences and unused tax losses/unabsorbed depreciation for which no deferred tax assets (net) have been recognised:

Deferred tax liabilities arising on account ofDifference between carrying value and tax base of property, plant and equipment

10,371,476 8,281,670 44,863

Financial assets and liabilities at amortised cost 2,874,237 3,439,161 3,283,669Compound instrument — 15,745,943 37,138,797

13,245,713 27,466,774 40,467,329Deferred tax assets arising on account ofProvision for employee benefits 870,425 733,787 662,207Financial assets and liabilities at amortised cost 3,063,217 3,556,685 3,337,187Losses carried forward 35,762,558 38,274,292 38,756,251Unabsorbed depreciation carried forward 21,942,927 10,695,881 299,141

61,639,127 53,260,645 43,054,786Net deferred tax assets / (liabilities) 48,393,414 25,793,871 2,587,457Net deferred tax liabilities recognised — — —

Note: • No deferred tax asset is recognised in the books of accounts, since the management has taken a conservative

view and have restricted the deferred tax assets to the extent of deferred tax liabilities. • The reconciliation between tax expense (income) and the product of accounting profit multiplied by the

applicable tax rate has not been prepared as there are no accounting profit for the year.



1128

M1128 K1128

M1128 K1128

9 Other non current assets As at 31 March 2019

As at 31 March 2018

As at 1 April 2017

Advances to suppliers — 1,545,773 —Prepaid expense 9,191,880 10,988,119 9,261,714Total 9,191,880 12,533,892 9,261,714

10 Trade receivableSecured, considered good — — —Unsecured - Considered good 166,660 119,788 1,473,734 - Considered doubtful — — —Less : Allowance for bad and doubtful debts — — —Total 166,660 119,788 1,473,734Further classified as:Receivable from related parties (refer note 32)Receivable from others 166,660 119,788 1,473,734Total 166,660 119,788 1,473,734

11 Cash and bank balancesCash and cash equivalentsBalances with banksOn current accounts 392,421 1,698,563 769,643Total 392,421 1,698,563 769,643

12 Current Financial assets - LoansUnsecured and considered goodSecurity deposit 16,993,242 — —Inter-corporate deposit 210,000,000 22,500,000 154,000,000Total 226,993,242 22,500,000 154,000,000

13 Other Financial assetsInterest accrued on inter-corporate deposits 1,524,883 85,440 95,218Total 1,524,883 85,440 95,218

14 Current tax assetsTax deductible at Source 8,662,597 3,525,424 557,121Total 8,662,597 3,525,424 557,121

15 Other current assetsBalance with Goods & Services Tax authorities 5,355,296 6,501,280 3,683,874Prepaid Expense 2,128,508 2,484,272 1,547,137Advance to suppliers 15,408 — —Mobilization Advance 7,894,047 — —Total 15,393,259 8,985,552 5,231,011


(Amount in `)

1129

M1129 K1129

M1129 K1129


(Amount in `)

16 Equity share capital As at 31 March 2019

As at 31 March 2018

As at 1 April 2017

The Company has only one class of equity share capital having a par value of INR 10 each, referred to herein as equity shares.Authorized135,000,000 (31 March 2018: 90,000,000, 1 April 2017: 35,000,000 of INR 10 each) Equity Shares of INR 10 each 1,350,000,000 900,000,000 350,000,000

1,350,000,000 900,000,000 350,000,000Issued, subscribed and paid up1,34,000,000 (31 March 2018: 37,000,000, 1 April 2017: 30,200,000 of INR 10 each) Equity Shares of INR 10 each 1,340,000,000 370,000,000 302,000,000Total 1,340,000,000 370,000,000 302,000,000

(a) Reconciliation of equity shares outstanding at the beginning and at the end of the year

Ordinary Equity Shares

As at 31 March 2019 As at 31 March 2018

Number of shares Amount Number of shares Amount

Outstanding at the beginning of the year 37,000,000 370,000,000 30,200,000 302,000,000Add: Issued during the year 97,000,000 970,000,000 6,800,000 68,000,000

Outstanding at the end of the year 134,000,000 1,340,000,000 37,000,000 370,000,000

(b) Details of shares held by shareholders holding more than 5% of the aggregate shares in the Company

Name of the shareholder 31 March 2019 31 March 2018 1 April 2017

Number of shares

% of holding in the class

Number of shares


Number of shares


Ordinary EquityHousing Development Finance Corporation Limited

134,000,000 99.99% 37,000,000 100.00% 30,200,000 100.00%

(c) The Company has one class of equity shares having a par value of Rs. 10 per share. Each holder of equity share is entitled to one vote per share held. The holder of equity shares are entitled to dividends, if proposed by the Board of Directors, and approved by the shareholders at the Annual General Meeting.

17 Other equity As at 31 March 2019

As at 31 March 2018

As at 1 April 2017

Sub- note

Retained earnings i (362,569,790) (280,180,133) (171,952,056)Equity component of optionally convertible debentures (net of tax) ii 163,537,506 163,537,506 163,537,506

(199,032,284) (116,642,627) (8,414,550)



1130

M1130 K1130

M1130 K1130

i) Retained earnings (Amount in `)

As at 31 March 2019

As at 31 March 2018

As at 1 April 2017

Balance at the beginning of year (280,180,133) (171,952,056) (110,352,743)Add: Net loss for the current year (77,788,473) (102,874,365) (61,498,268)Add: Increase in share issue expense during the year (4,575,000) (5,293,000) —Items of other comprehensive income recognised directly in retained earnings:Add: Re-measurement gain/(loss) on post employment benefit obligation (26,184) (60,712) (101,045)Balance at the end of the year (362,569,790) (280,180,133) (171,952,056)

ii) Equity component of Optionally convertible debenturesBalance at the beginning of the year 163,537,506 163,537,506 163,537,506Balance at the end of the year 163,537,506 163,537,506 163,537,506

18 Non-current financial liabilities - borrowings

Effective interest rate

Maturity Date

Redemption Date

As at 31 March 2019

As at 31 March 2018

As at 1 April 2017

UnsecuredLiability component of optionally convertible debentures

11.60% 24 August 2022

15 March 2019

— 224,398,454 199,824,946

Liability component of optionally convertible debentures

10.84% 05 June 2023

15 March 2019

— 45,198,443 40,555,797


10.99% 04 October 2023

15 March 2019

— 45,135,353 40,438,502


10.51% 15 December

2023

15 March 2019

— 90,675,111 81,630,098


10.36% 21 February 2024

15 March 2019

— 163,443,347 147,360,377

Total Borrowings — 568,850,708 509,809,720Less: Current Maturities of long term borrowings

— — —

Total — 568,850,708 509,809,720

Note: Liability component of Optionally Convertible Debentures (“OCD”) represents the mandatory payments required under

the terms of the OCD, discounted at the effective interest rate. Interest is not payable on OCD’s as per the agreement.

Terms and conditions of the OCDs Nature The OCDs at the option of the debenture holder can be converted as 1 OCD to 1 Compulsory Convertible

Debenture (“CCD”) of Rs 10 each or 1 Equity share or redeem automatically upon expiry of 7 years from the date of allotment. Further, debenture holders at their option can convert 1 CCD into 1 Equity share or it will be automatically converted upon expiry of 7 years from the date of allotment of CCD.


1131

M1131 K1131

M1131 K1131


Interest The Debentures will bear an interest rate of 0% per annum on the accrued amount, compounded annually. Transferability The Debentures shall be transferable and transmittable in the same manner and to the same extent and be

subject to the same restrictions and limitations as in the case of existing equity shares of the company. Conversion The Debenture holder can convert 1 OCD to 1 Compulsory Convertible Debenture (CCD) of Rs 10 each or 1 Equity

share or redeem automatically upon expiry of 7 years from the date of Allotment. Further, Debenture holders at their option can convert 1 CCD into 1 Equity share or it will be automatically converted upon expiry of 7 years from the date of allotment of CCD.

Surrender of Debenture on payment For payment to the Debenture holder in full discharge of all principal monies due, the Company shall make

payment of principal amount and any interest accrued therein (if any), to the Debenture Holder or to any subsequent transferee(s) who are entitled to receive the payment on the applicable redemption date upon the Debenture holder or the subsequent transferee (as applicable) giving appropriate instructions to hand over the debenture certificates to the Company. Upon receipt of the applicable amount of monies, the Debenture holder or the subsequent transferee(s), as applicable shall issue appropriate receipts in this regard to the Company.

(Amount in `)

19 Other non-current liabilities As at 31 March 2019

As at 31 March 2018

As at 1 April 2017

Loans 3,300,000 3,300,000 —Retention money payable 1,666,305 — —Total 4,966,305 3,300,000 —

20 ProvisionsLong term Short term

As at 31 March 2019

As at 31 March 2018

As at 1 April 2017

As at 31 March 2019

As at 31 March 2018

As at 1 April 2017

Provision for employee benefits:Provision for gratuity (unfunded) 773,212 598,013 393,928 61,992 48,747 —Provision for leave travel allowance 136,978 40,934 104,166 41,615 25,843 65,331Provision for leave encashment (unfunded)

834,571 634,710 387,036 56,473 44,326 37,002

Total 1,744,761 1,273,657 885,130 160,080 118,916 102,333

21 Trade payables As at 31 March 2019

As at 31 March 2018

As at 1 April 2017

Total outstanding dues of creditors other than micro enterprises and small enterprises

3,881,149 4,859,205 3,803,064

Total 3,881,149 4,859,205 3,803,064



1132

M1132 K1132

M1132 K1132

21A Details of dues to micro and small enterprises as defined under The MSMED Act, 2006*(Amount in `)

Particulars

(a) the principal amount and the interest due thereon remaining unpaid to any supplier at the end of each accounting year:

- Principal amount due to micro and small enterprises — — — - Interest due on above — — —(b) the amount of interest paid by the buyer in terms of

section 16 of the Micro, Small and Medium Enterprises Development Act, 2006, along with the amount of the payment made to the supplier beyond the appointed day during each accounting year.

— — —

(c) the amount of interest due and payable for the period of delay in making payment (which have been paid but beyond the appointed day during the year but without adding the interest specified under the Micro, Small and Medium Enterprises Development Act, 2006.

— — —

(d) the amount of interest accrued and remaining unpaid at the end of each accounting year

— — —

(e) the amount of further interest remaining due and payable even in the succeeding years, until such date when the interest dues above are actually paid to the small enterprise, for the purpose of disallowance of a deductible expenditure under section 23 of the Micro, Small and Medium Enterprises Development Act, 2006.

— — —

*The above information takes into account only those suppliers who have responded to the enquiries made by the Company for this purpose.

22 Other current liabilities As at 31 March 2019

As at 31 March 2018

As at 1 April 2017

Statutory due payable 105,190 350,058 3,577,854Security deposits from vendors (including retention money) 1,942,441 3,824,551 7,500,866Other current liabilities 8,359,209 6,647,012 31,780,673Total 10,406,840 10,821,621 42,859,393

23 Revenue from operations Year ended31 March 2019


Sale of services 26,512,424 11,056,172Break-up of revenue:Revenue from direct billing to customers 26,512,424 11,056,172Total 26,512,424 11,056,172


1133

M1133 K1133

M1133 K1133


24 Other income (Amount in `)



Interest income- on Income-taxes 51,475 —- on inter corporate deposits 11,922,636 2,484,718Other non operating income- Revenue from rent of investment property (refer to note 6A) 19,800,000 14,850,000- Interest on bank deposits — 479- Interest income from financial assets carried at amortised cost 2,228,191 1,185,931Total 34,002,302 18,521,128

25 Employee benefits expenseSalaries, wages, bonus and other allowances 9,435,548 7,394,989Contribution to provident fund and ESI 301,080 219,852Gratuity (Refer to note 30) 162,260 192,120Staff welfare expenses 89,499 96,796Total 9,988,387 7,903,757

26 Finance costs

Interest on optionally convertible debentures 61,149,292 59,040,988Total 61,149,292 59,040,988

27 Depreciation and amortization expense

Depreciation on Property plant and equipment (Refer to note 5) 17,479,668 10,814,051Depreciation on Investment property (Refer to note 6) 7,304,018 6,955,677Amortization on Intangible assets (Refer to note 5) 652,795 476,466Total 25,436,481 18,246,194

28 Other expenses

Advertisement 32,609,354 37,543,706Legal and professional charges 3,111,702 2,330,083Audit fees* 1,603,371 853,108Travel and conveyance 1,160,171 1,551,218Repairs and maintenance - building 1,017,248 753,983Director sitting fee 1,026,600 699,452Rent 600,000 620,920Rates and taxes 301,789 1,893,540Electricity and water — 416,926Miscellaneous expenses 298,804 597,790Total 41,729,039 47,260,726

* Note: The following is the break-up of auditors remuneration (exclusive of service tax & GST)



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(Amount in `)

Payment to auditors Year ended31 March 2019


- As auditor 550,000 581,233- For tax audit 300,000 —- For taxation matters 727,455 244,218- For reimbursement of expenses 25,916 27,657Total 1,603,371 853,108

29 Loss per share Year ended31 March 2019


Year ended1 April 2017

The numerators and denominators used to calculate the basic and diluted EPS are as follows:Net loss attributable to shareholders for basic and diluted earnings per share

(77,788,473) (102,874,365) (61,498,268)

Weighted average number of equity shares for basic and diluted earnings per share

61,326,027 31,150,137 30,200,000

Basic and diluted earnings per share (1.27) (3.30) (2.04) *During the current year, the effect of potential equity shares on account of Optionally Convertible Debentures

is anti-dilutive and hence the same has not been considered in calculating the diluted EPS.

30 Employee benefitsYear ended



1 April 2017

Gratuity 835,204 646,760 393,928Compensated absences 891,044 679,036 424,038Leave travel allowance 178,593 66,777 169,497

The following tables summarise the components of net benefit expense recognised in the statement of profit and loss and the amount recognised in the balance sheet for the defined benefit plan.

Gratuity benefits

31 March 2019 31 March 2018

Change in the present value of the defined benefit obligation:Opening defined benefit obligation 646,760 393,928Interest cost 50,447 28,442Current service cost 111,813 87,984Past service cost — 75,694Actuarial losses/(gains) on obligation 26,184 60,712Closing defined benefit obligation 835,204 646,760Expense/(income) recognised in the other comprehensive income: 26,184 60,712Net actuarial loss/(gain) in the year 26,184 60,712Net expense recognised in the Other comprehensive incomeActuarial loss/(gain) arising from change in financial assumption 11,134 43,194Actuarial loss/(gain) arising from experience adjustment 15,050 17,518


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(Amount in `)

Actuarial assumptions used 31 March 2019 31 March 2018 1 April 2017

Discount rate 7.64% 7.80% 7.22%Long-term rate of compensation increase 12% 12% 10%Employee turnover rate 10% 10% 10%

Demographic assumptions used 31 March 2019 31 March 2018 1 April 2017

Mortality tableRetirement age: 58 58 58Withdrawal rates for all ages

These assumptions were developed by the management with the assistance of independent actuarial appraisers. Discount factors are determined close to each year end by reference to government securities and that have terms to maturity approximating to the terms of the related obligation. Other assumptions are based on management’s historical experience.

Sensitivity analysis The significant actuarial assumptions for the determination of the defined benefit obligation are the discount

rate, the salary growth rate and the average employee turnover. The calculation of the net defined benefit liability is sensitive to these assumptions. The following table summarises the effects of changes in these actuarial assumptions on the defined benefit liability at 31 March 2019.

As at 31 March 2019 As at 31 March 2018

Increase by 1% Decrease by 1% Increase by 1% Decrease by 1%

Discount Rate(Decrease)/ increase in the defined benefit liability (65,649) 75,705 (52,261) 60,594Salary growth rateIncrease/ (Decrease) in the defined benefit liability 42,212 (42,505) 35,288 (35,406)Employee Turnover RateIncrease/ (Decrease) in the defined benefit liability (11,553) 11,845 (10,536) 11,162

The sensitivity analysis have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.

The sensitivity analysis presented above may not be representative of the actual change in the projected benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the projected benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same method as applied in calculating the projected benefit obligation as recognised in the balance sheet.

Amounts for the current and previous two years are as follows:2018-19 2017-18 2016-17

Defined benefit obligations 835,204 646,760 393,928Experience (gain)/loss adjustments on planned liabilities 15,050 17,518 82,631



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Maturity Profile of Defined Benefit Obligation (Amount in `)

2018-19 2017-18

1st following year 61,992 48,7472nd following year 62,453 49,1053rd following year 62,920 49,4674th following year 65,400 49,8345th following year 67,657 50,973Sum of years 6 to 10 346,132 260,721Sum of years 11 and above 1,203,976 1,020,059

Other details 2018-19 2017-18

No of active members 4 4Per month salary for active members 209,084 188,400Weighted average duration of the projected benefit obligation 10 10Average expected future service 8 8Projected benefit obligation (PBO) 835,204 646,760Prescribed contribution for next year (12 Months) — —

Risk associated with plan provisions Valuations are based on certain assumptions, which are dynamic in nature and vary over time. As such Company

is exposed to various risks as follows:

(a) Interest rate risk A fall in the discount rate which is linked to the Government Securities rate will increase the present value

of the liability requiring higher provision.

(b) Salary risk The present value of the defined benefit plan liability is calculated by reference to the future salaries of

members. As such, an increase in the salary of the members more than assumed level will increase the plan’s liability.

(c) Asset liability matching (“ALM”) risk The plan faces the ALM risk as to the matching cash flow. Company has to manage pay-out based on pay

as you go basis from own funds.

(d) Mortality risk Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does

not have any longevity risk.

Compensated absences The leave obligations cover the Company’s liability for earned leaves. The Company does not have an unconditional

right to defer settlement for the obligation shown as current provision balance above. However, based on past experience, the Company does not expect all employees to take the full amount of accrued leave or require payment within the next 12 months, therefore, based on the independent actuarial report, only a certain amount of provision has been presented as current and balance as non-current.

Leave travel allowance The leave travel obligations cover the Company’s liability for employees travel. The Company does not have an

unconditional right to defer settlement for the obligation shown as current provision balance above. However,


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based on past experience, the Company does not expect all employees to take the full amount of accrued leave travel allowance or require payment within the next 12 months, therefore, based on the independent actuarial report, only a certain amount of provision has been presented as current and balance as non-current.

Defined contribution plans The Company has certain defined contribution plans. Contributions are made to provident fund in India for

employees at the rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the Government. The obligation of the Company is limited to the amount contributed and it has no further contractual or any constructive obligation. The expense recognised during the year towards defined contribution plan is INR 301,080 (31 March 2018 INR 219,852).

31 Leases Operating leases where Company is a lessor: The Company has entered into lease transactions mainly for leasing of school building for a period of 30 years.

The terms of lease include terms of renewal, increase in rents in future periods and terms of cancellation. The lease is non-cancellable at the option of the lessor, however, the lessee can cancel such lease after giving 3 months notice to the lessor. The operating lease revenue recognized in the Statement of Profit and Loss amount to INR 148.50 lakhs (31 March 2018: INR 148.50 lakhs) included in Note 24.

Operating leases where Company is a lessee: The Company has entered into lease transactions for its operation purpose with its holding company. The operating

lease expense recognized in the Statement of Profit and Loss amount to INR 6 lakhs (31 March 2018: INR 6.21 lakhs) included in Note 28.

32 Related party transactions In accordance with the requirement of Indian Accounting Standard (Ind AS) 24 “Related Party Disclosures”, name

of the related parties, related party relationships, transactions and outstanding balances including commitments where control exist and with whom transactions have taken place during the reported period are as follows:

(A) List of related parties Relationship Name of the Related party Holding Company Housing Development Finance Corporation Limited Fellow Subsidiary HDFC Ergo General Insurance Company Limited Key Management Personnel Mr. Conrad D’Souza, Director Mr. Keyur Shah, Director Mr. Rajeev Sardana, Director Mr. S . N Shroff, Director Mr. Sudhir Kumar Jha, Director Mr. V.S. Rangan, Director Mr. Yogesh Kapur, Director Simrita Ahluwalia, Chief Executive Officer Ramesh Nayal, Chief Financial Officer Lalit Jain, Company Secretary R. Aditya Subramanyam, Company Secretary



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(B) Details of transaction between the Company and its related parties are disclosed below: (Amount in `)

Particulars Holding Company Fellow Subsidiary Company Key Managerial Personnel

31 March 2019

31 March 2018

31 March 2019

31 March 2018

31 March 2019

31 March 2018

Transactions during the year

Expenditure

(i) Remuneration — — — — 2,738,317 2,562,390

(ii) Deputation cost* 1,907,532 1,474,548 — — — —

(iii) Interest expense — — — — — —

(iv) Rent* 600,000 600,000 — — — —

(v) Insurance expense* — — 104,159 55,411 — —

(vi) Directors sitting fee* — — — — 870,000 699,452

(vii) Miscellaneous expenses (reimbursement of expenses)

2,090 — — — — —

Income

(i) Interest received 11,922,637 2,484,718 — — — —

Other transactions during the year

(i) Short term borrowings taken — — — — — —

(ii) Short term borrowings repaid — — — — — —

(iii) Allotment of shares 970,000,000 68,000,000 — — — —

(iv) Optionally convertible debentures issued — — — — — —

(v) Opt ional ly conver t ible debentures redeemed

630,000,000 — — — — —

(vi) Inter corporate deposits placed 896,000,000 92,595,218 — — — —

(vii) Inter corporate deposits matured 708,500,000 224,095,218 — — — —

(viii) Deputation cost capitalised to fixed assets* — 360,052 — — — —

Foot Note: The amount of finance cost on optionally convertible debenture ` 61,149,292 (Previous year ` 59,040,988).

Particulars Holding Company Subsidiary Company Key Managerial Personnel

31 March 2019

31 March 2018

1 April 2017

31 March 2019

31 March 2018

1 April 2017

31 March 2019

31 March 2018

1 April 2017

Balance outstanding at the year end

(i) Loans and advances- prepaid expenses

— — — 159,922 39,282 35,769 — — —

(ii) Trade payables 2,090 216,502 — — — — — — —

(iii) Optionally convertible debentures

— 568,850,708 509,809,720 — — — — — —

(iv) Share capital 1,340,000,000 370,000,000 302,000,000 — — — — — —

( v ) I n te r c o r p o r a te deposits

210,000,000 22,500,000 154,000,000 — — — — — —

(vi) Interest accrued on deposits

1,524,883 85,440 95,218 — — — — — —

* The figures are exclusive of Service Tax/ Goods and Services Tax


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Breakup for Key management personnel’s compensation in the following categories: (Amount in `)

Particulars 31 March 2019 31 March 2018

Short-term employee benefits * 2,738,317 2,562,390Post-employment benefits — —Other long-term benefits — —Termination benefits — —Share-based payment — —

* As the liability for gratuity, leave encashment and leave travel allowance are provided on actuarial basis for the Company, as a whole, amounts accrued pertaining to key management personnel are not included above.

33 Financial risk management i) Financial instruments by category Fair value hierarchy Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 - Inputs other than quoted prices included within level 1 that are observable for the asset or liability,

either directly (i.e. as prices ) or indirectly (i.e. derived from prices). Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable

inputs).

Particulars 31 March 2019 31 March 2018 1 April 2017

Level 3 Amortised cost



Financial assetsInvestmentsTrade receivables 166,660 119,788 1,473,734Loans 244,918,399 52,227,633 169,240,044Cash and cash equivalents 392,421 1,698,563 769,643Interest accrued on Inter Corporate Deposits 1,524,883 85,440 95,218Total 247,002,363 54,131,424 171,578,639Financial liabilitiesBorrowings — 568,850,708 509,809,720Trade payables 3,881,149 4,859,205 3,803,064Other financial liabilities — — —Total 3,881,149 573,709,913 513,612,784

(a) The carrying value of trade receivables, securities deposits, cash and bank balances and other financial assets recorded at amortised cost, is considered to be a reasonable approximation of fair value.

(b) The carrying value of borrowings, trade payables and other financial liabilities recorded at amortised cost is considered to be a reasonable approximation of fair value.

(c) All the financial assets and liabilities fall under level 3 hierarchy.

ii) Risk Management The Company’s activities expose it to liquidity risk and credit risk. This note explains the sources of risk

which the entity is exposed to and how the entity manages the risk and the related impact in the financial statements:



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Risk Exposure arising from Measurement Management

Credit Risk Cash and cash equivalents, trade receivables, financial assets measured at amortised cost

Ageing analysis Bank deposits, credit limits, diversification of asset base.

Liquidity risk Borrowings and other liabilities Rol l ing cash flow forecasts

Availability of sufficient liquid assets

The Company’s risk management is being reviewed periodically by Chief Financial Officer(CFO) of the Company. A) Credit Risk Credit risk is the risk that a customer or counterparty to a financial instrument will fail to perform or pay

amounts due to the Company causing financial loss. It arises from cash and cash equivalents, deposits with banks, security deposits. The Company’s maximum exposure to credit risk is limited to the carrying amount of financial assets recognised at reporting date.

The Company continuously monitors defaults of customers and other counterparties. In respect of trade and other receivables, the Company is not exposed to any significant credit risk exposure to any single counterparty or any company of counterparties having similar characteristics. The Company has no history of customer default, and considers the credit quality of trade receivables that are not past due or impaired to be good.

The credit risk for cash and cash equivalents, bank deposits, security deposits is considered negligible, since the counterparties are reputable organisations with high quality external credit ratings.

Company provides for expected credit losses on financial assets by assessing individual financial instruments for expectation of any credit losses. Since the assets have very low credit risk, and are for varied natures and purpose, there is no trend that the company can apply consistently to entire population. The Company does not have any expected loss considering their low credit risk nature, though incurred loss provisions are disclosed under each sub-category of such financial assets.

Detail of trade receivables that are past due is given below: (Amount in `)

As at31 March 2019

As at31 March 2018

As at1 April 2017

Not Due — — —0-30 days past due 166,660 119,788 1,473,73431-60 days past due — — —61-90 days past due — — —More than 90 days — — —Total 166,660 119,788 1,473,734

B) Liquidity Risk Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the

availability of sufficient liquid assets to meet obligations when due. Due to the nature of the business, the Company maintains flexibility in funding by maintaining availability from redemption in fixed deposits.

Management monitors rolling forecasts of the Company’s liquidity position and cash and cash equivalents on the basis of expected cash flows. The Company takes into account the liquidity of the market in which the entity operates.


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Financing Arrangements Contractual maturities of financial liabilities The tables below analyse the Company’s financial liabilities into relevant maturity groupings based on their

contractual maturities for all non-derivative financial liabilities. The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying amounts as the impact of discounting is not significant.

(Amount in `)

31 March 2019 Payable on demand

Less than 1 year 1-2 year 2-3 year More than 3 years

Total

Non DerivativesBorrowings — — — — — —Trade payables — 3,881,149 — — — 3,881,149Loans — — — — 3,300,000 3,300,000Total — 3,881,149 — — 3,300,000 7,181,149

31 March 2018 Payable on demand


Total

Non DerivativesBorrowings — 630,000,000 — — — 630,000,000Trade payables — 3,335,345 — — — 3,335,345Loans — — — — 3,300,000 3,300,000Total — 633,335,345 — — 3,300,000 636,635,345

1 April 2017 Payable on demand


Total

Non DerivativesBorrowings — — 630,000,000 — — 630,000,000Trade payables — 2,477,968 — — — 2,477,968Loans — — — — — —Total — 2,477,968 630,000,000 — — 632,477,968

C) Market Risk The Company is not exposed to any significant market risk.34 Capital management The Company’ s capital management objectives are:- - to ensure the Company’s ability to continue as a going concern - to provide an adequate return to shareholders The Company monitors capital on the basis of the carrying amount of equity less cash and cash equivalents as

presented on the face of balance sheet. The Management assesses the Company’s capital requirements in order to maintain an efficient overall financing

structure while avoiding excessive leverage. This takes into account the subordination levels of the Company’s various classes of debt. The Company manages the capital structure and makes adjustments to it in the light of changes in the economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company may adjust the return capital to shareholders, issue new shares, or sell assets to reduce debt.



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(Amount in `)

a) Particulars As at31 March 2019

As at31 March 2018

As at01 April 2017

Net debts — 568,850,708 509,809,720 Total equity 1,140,967,716 253,357,373 293,585,450 Gearing ratio 0% 225% 174%

35 Contingent Liability There are no pending litigations which the Company believes could reasonably be expected to have a material

adverse effect on the results of operations, cash flow or the financial position of the Company.36 The Company did not have any long term contracts including derivative contracts for which there were any material

foreseeable losses.37 There were no amounts which were required to be transferred to the Investor Education and Protection Fund by

the Company.

38 Capital Commitments Estimated amount of contracts remaining to be executed on capital account and not provided for INR 15,72,44,835

(Previous year INR 51,93,146).39 Previous year figures have been regrouped/ reclassified to confirm presentation as per Ind AS as required by

Schedule III of the Act.

For and on behalf of the Board of Directors

Keyur Shah Rajeev Sardana Simrita Ahluwalia (DIN: 00332145) (DIN: 06648276) CEO

Ramesh Nayal Lalit Jain Chief Financial Officer Company Secretary ICAI M.No. 507968 ICSI M.No. A37005

02 May 2019 Delhi


Eighth Annual Report 201819 M1086 K1086...Mr. Rajeev Sardana 4 Mr. Keyur Shah 5 Mr. S. N. Shroff 5...

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Transcript of Eighth Annual Report 201819 M1086 K1086...Mr. Rajeev Sardana 4 Mr. Keyur Shah 5 Mr. S. N. Shroff 5...