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I N OX L E I S U R E L I M I T E D

Annual Report 2015 - 2016

LivetheMovie

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In FY2016, we put our customers at the heart of everything we did. Our endeavour was to deliver a world class experience to cinema goers at all times. We made cinema-going a delightful experience – right from the ease of booking, providing the widest range of movies, reviewing movie schedules, offering a wide range of lip-smacking cinema food, all set in the midst of cutting edge cinema exhibition technology. We work tirelessly to become the favourite cinema chain of choice and deliver a broad range of films at a great value price, offering our customers a good choice of content on each visit. Going forward, we continuously seek to re-invent our concept of “value” and “entertainment” for our patrons, and strengthen the emotional connect of our customers to our brand.

Today, we are one of the largest multiplex chains in India. Driven by strong box office performance, we expect our peer position to continue on the back of strong content delivery from the movie industry’s pipeline. Through a growing circuit of high quality cinemas and our strong emphasis on customer service excellence, we are offering high-quality venues with excellent operational delivery and a retail offering that suits customers’ tastes. We are constantly working towards raising the bar for operational excellence and a national footprint to sustain our industry leadership.

In FY2016, we crossed the mark of 100 properties, 400 screens and 100,000 seats. Additionally, we have signed a landmark deal with IMAX Corporation, for five IMAX® theatre systems, the biggest deal in the country.

We entertained 53.4 million patrons in FY2016, up by 30% over FY2015. We also added 51 screens to our portfolio, taking our network to a total screen count of 420 screens, spread across 107 properties in 57 cities in FY2016. Our occupancy rates improved and our Average Ticket Price and Spend Per Head expanded on account of higher footfalls stemming from a strong movie line-up. Our non-box office revenues also witnessed good growth. Food & Beverage revenue continued to be our bright spot enjoying 39% YoY growth with improved profitability. Our advertising revenue also grew by 12% on YoY basis, with further headroom for ample growth in FY2017. Moving ahead, we aim to up the ante with new screen additions and overall volume growth.

Annual Report 1516

AT A GLANCEWe are one of India’s largest multiplex operators,engaged in the business of film exhibition and operating and managing of multiplexes. As on 8th August 2016, our portfolio of 108 multiplexes and over 425 screens in 57 cities with a seating capacity of 109,406 makes us truly pan-India multiplex chain.

A mix of organic and inorganic expansion has enabled us to have an entrenched position in the domestic multiplex industry and emerge as one of the largest multiplex players in India with approximately 8% market share in domestic box office collections.

We operate 41 properties in West India, followed by 25 in North, 24 in South and 18 in the East. Our established market position and a geographically diversified screen presence help us capitalise on industry growth.

We are one of the first companies to develop the multiplex concept in India. Our vision is to become India’s largest multiplex operator in every aspect – from quality and choice of cinema to varied services offered.

19 States

57 Cities

108 Properties

Quick Facts

Our Expansion Spree

No of Properties No of Screens

2

63

8

239

3

68

12

257

6

72

25

279

9

79

35

310

14

96

51

372

22

10776

420

26

91

32

119

FY2003 FY2011FY2005 FY2013FY2008 FY2016FY2004 FY2012FY2007 FY2015FY2006 FY2014FY2009 FY2010

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What Differentiates us in the Marketplace

- ONE OF THE LARGEST MULTIPLEX PLAYER WITH AGGRESSIVE GROWTH PLANS

- WELL DIVERSIFIED PRESENCE ACROSS INDIA

- DOUBLE DIGIT ADVERTISEMENT REVENUE GROWTH, LED BY BETTER MONETISATION

- STATE-OF-THE-ART TECHNOLOGY IN MODERN PROJECTION AND ACOUSTIC SYSTEMS

- STRONG IMPROVEMENT IN AVERAGE TICKET PRICE (ATP) AND SPEND PER HEAD (SPH)

- STRONG NEW SCREENS PIPELINE

- STRONG BRAND PARTNERSHIPS

- ACCESS TO WIDE VARIETY OF REGIONAL CONTENT

- LOWER DEPENDENCY ON HINDI AND ENGLISH CONTENT

425 Screens

109, 406 Seats

53.4 Mn Patrons

Contents

At a Glance ..................................................2

Pride of Parentage .......................................4

Our Key Operating Metrics .........................6

Our Financial Scorecard ..............................7

Pan India Presence .......................................8

Our Brand Partnerships ...............................9

Board of Directors ...................................10

Management's Discussion & Analysis .........23

Notice........................................................33

Route Map. ................................................45

Board’s Report. .........................................46

Corporate Governance Report .................76

Standalone Financial Statements ................90

Consolidated Financial Statements ..........126

Annual Report 1516

PRIDE OF PARENTAGEThe INOX Group is a family owned, professionally managed business group, with market leadership in diverse businesses including Industrial Gases, Refrigerants, Chemicals, Cryogenic Engineering, Renewable Energy and Entertainment.

It employs more than 9,000 people at more than 150 business units in India and has a distribution network that is spread across more than 50 countries across the globe.

The Group includes three public-listed companies – Gujarat Fluorochemicals Limited, INOX Leisure Limited and INOX Wind Limited. Gujarat Fluorochemicals is a pioneer of carbon credits in India and is among the largest generators of carbon credits globally.

We are a subsidiary of Gujarat Flourochemicals Limited, a part of the US$ 3 billion INOX Group with a rich lineage of diversified and successful businesses.

90 year track record of ethical business growth

Diversified, professionally

managed group

22 companies (3 listed, 7

international subsidiaries, 5 joint

ventures)

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31

4

5More than 150 business units across India,

employing more than 9,000 people

10 different businesses

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INOX GROUP COMPANIES

INOX LEISURE LIMITED

GUJARAT FLUOROCHEMICALS

LIMITED

INOX WIND LIMITED

INOX AIR PRODUCTS PRIVATE

LIMITED

INOX INDIA PRIVATE LIMITED

INOX RENEWABLES LIMITED

• One of the largest multiplex chains in India

• In the business of setting up, operating and managing a national chain of multiplexes under the brand name ‘INOX’

• Currently, present in 57 cities with 108 multiplexes and 425 screens

• Largest producer of chloromethanes, refrigerants & Polytetrafluoroe-thylene in India

• Pioneer of carbon credits in India

• Fully integrated player in the wind energy market

•State-of-the-artmanufacturing plants near Ahmedabad (Gujarat) and at Una (Himachal Pradesh) and upcoming new facility in Madhya Pradesh

• Ability to provide end-to-endturnkeysolutions for wind farms

• 50:50 joint venture with Air Products Inc., USA

• Largest producer of industrial gases in India

• 40 plants spread throughout the country

• Largest producer of cryogenic liquid storage and transport tanks in India

• Offers comprehensive solutions in cryogenic storage, vaporization and distribution engineering

• Has operations in India, USA, Canada, The Netherlands and Brazil

• Engaged in the business of setting up and operating of wind farms

• 213 MW operational capacity in 3 different states with another 20 MW ready for commissioning

Annual Report 1516

OUR KEY OPERATING METRICS

FY2012 FY2013 FY2014 FY2015 FY2016

30.735.3

38.6 41.1

53.4

25 28 28 25 29

Footfalls (Mn) Occupancy Rate (%)

Footfalls and Occupancy Rate

FY2012 FY2013 FY2014 FY2015 FY2016

44 47 4955 58

F&B Spend Per Head (`)

FY2012 FY2013 FY2014 FY2015 FY2016

1.3 1.4

1.8

2.5 2.5

Advertisement Revenue Per Operating Screen (` Mn)

FY2012 FY2013 FY2014 FY2015 FY2016

156

160

156

164

170

Average Ticket Price (`)

69.470

71.3

74.175

F&B Net Contribution (%)

FY2012 FY2013 FY2014 FY2015 FY2016 FY2012 FY2013 FY2014 FY2015 FY2016

1.3 1.4

2.3 2.21.92

Other Revenue Per Operating Screen (` Mn)

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OUR FINANCIAL SCORECARD

Segment-Wise Revenues (%)

FY2012 FY2013 FY2014 FY2015 FY2016

6,448.67,652.9

8,688.310,168.1

13,326.9

Revenues (` Mn)

FY2012 FY2013 FY2014 FY2015 FY2016

ROCE (%) ROE (%)

Return Metrics

3.8

12.210.3

11.5

6.1

12.4

9.4

6.05.7

1.3

GBOC* (%)

*GBOC=Gross Box Office Collections

F & B (%) Advtg (%) Others (%)

FY2012 FY2013 FY2014 FY2015 FY2016

EBITDA EBITDA Margin (%)

EBITDA (` Mn) & EBITDA Margins

728.8980.1 1219.6 1227.7

1899.1

14.311.3

12.8 14.012.1

FY2012 FY2013 FY2014 FY2015 FY2016

Profit After Tax PAT Margin (%)

PAT (` Mn) and PAT Margins

184.5

0.7

2.4

4.3

2.0

5.8

73.0

18.0

5.05.0

73.0

19.0

69.0

19.06.07.0

66.0

19.0

7.0

68.0

20.0

5.0

Average Ticket Price

(`)

Average F & B Spend

(`)

Footfalls (Mn)

FY2015 FY2016

Our YoY Performance

164 170

55 5841.1

53.4

CAGR-20%

CAGR-27% CAGR-107%

7.08.04.04.0

42.3

369.4200.4

774.9

FY2012 FY2013 FY2014 FY2015 FY2016

Annual Report 1516

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OUR BRAND PARTNERSHIPS

Annual Report 1516

BOARD OF DIRECTORSMr. Pavan JainChairman

Mr. Pavan Jain, Chairman of the INOX Group, is a Chemical Engineer from IIT, New Delhi, and an industrialist with over 40 years of experience. With over 30 years of experience as the Managing Director of INOX Air Products Private Limited, Mr. Jain has steered the company’s growth from a single plant business to one of the leading

domestic players in the Industrial Gases business. In addition, Mr Jain has been instrumental in diversifying the INOX Group into various industries such as Refrigerant Gases, Chemicals, Cryogenic Engineering, Entertainment and Renewable Energy.

Mr. Vivek JainDirector

Mr. Vivek Jain has graduated in Economics from St. Stephens, New Delhi, and did his post-graduation in business administration from IIM, Ahmedabad, where he specialized in Finance. He has over 35 years of business experience and is currently the

Managing Director of Gujarat Fluorochemicals Limited.

Mr. Amit JatiaDirector

Mr. Amit Jatia holds a degree in Business Administration from the University of Southern California, Los Angeles. Mr. Amit Jatia has over 25 years of experience in the QSR industry. He has been instrumental in putting in place

the building blocks of McDonald’s in India and thereby creating the essential organizational infrastructure to develop and run the chain of McDonald’s restaurants in West and South India.

Mr. Deepak AsherDirector

Mr. Deepak Asher, in addition to being a Commerce and Law graduate, is an eminent Chartered Accountant and Cost and Works Accountant with more than 32 years’ of rich experience in the field of strategic business planning, formulation and implementation of various growth strategies as well as financial planning and management. He is a Director and Group Head (Corporate Finance) of the INOX

Group of Companies, comprising of three listed companies and three international joint ventures. He has been instrumental in setting up various businesses for the INOX Group including the cinema exhibition business, the renewable energy business and the path-breaking carbon credit business. He is a founder president of Multiplex Association of India and a member of the FICCI Entertainment Committee.

Mr. Siddharth JainDirector

Mr Siddharth Jain earned a Bachelor’s Degree in Mechanical Engineering at The University of Michigan, USA and an MBA from INSEAD, France. Mr Jain is currently a Whole-Time Director of INOX Air Products Private Limited, and also holds Directorship in other Group Companies

as well. He has over 16 years of experience in working with various Business Units across the Group.

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Mr. Kishore BiyaniDirector

Mr. Kishore Biyani is a Commerce Graduate from the University of Mumbai and post graduate diploma in Marketing Management from the University of Mumbai. He is the founder of the Future Group of Companies and is considered as

a pioneer of modern retail in India. He has been regularly ranked among India’s most admired CEOs and he is the author of the book ‘It Happened in India’.

Ms. Girija BalakrishnanDirector

Ms. Girija Balakrishnan has graduated from the prestigious National Law School of India University in 1993. She is a Member of the Bar Council of Karnataka. She is a partner of Malvi Ranchoddas & Co. and specializes in Corporate

Laws, Mergers and Acquisitions, Commercial Laws, Foreign Direct Investments, Joint Ventures and Foreign Collaboration.

Mr. Alok TandonMr. Alok Tandon is a Graduate in Mechanical Engineering with over 28 years of experience across Entertainment, Hospitality and Pharmaceutical industries. Mr. Tandon has been part of the start-up team of the Company and has helped build and develop the Company since its inception. He played a very active role in all the three Merger & Acquisitions made

by the Company viz. Calcutta Cine Pvt. Ltd. in 2007, Fame India Ltd, in 2010 and Satyam Cineplexes Ltd. in August 2014. Spearheading the Company’s expansion and consolidation, Mr. Tandon, has been successfully steering the growth momentum of INOX over the years and by being true to its motto of ‘LIVE THE MOVIE’.

Mr. Haigreve KhaitanDirector

Mr. Haigreve Khaitan is a Senior Partner of Khaitan & Co, one of India’s oldest, largest and most prestigious full service law firms. Haigreve started his career in litigation at the Firm’s Calcutta office and co-founded the Mumbai office, which is now its largest, in 2001. Over the years, Haigreve has been involved in some of the most significant and complex M&A and private

equity transactions in India. He also spends substantial time on strategic advisory and private client matters. Haigreve’s clientele comprises of a range of Indian conglomerates, promoters, global private equity funds and multinational clients across sectors.

CHIEF EXECUTIVE OFFICER

Annual Report 1516

OUR BUSINESS ENABLERS FOR LONG TERM GROWTH

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As one of the largest multiplex operators in India, we are in a great position to leverage the inherent demand for movies in India and gain from the changed dynamics of the theatre industry. We have demonstrated excellent growth in footfalls, Average Ticket Price (ATP) and Spend Per Head (SPH) with a strong brand franchise. Our motive is to create well-targeted value propositions to build a brand that does more than just screen movies.

Currently, we are exhibiting rapid organic and inorganic growth by adding new screens across the country. We have established our brand presence well which, in turn, drives customer acquisition and strengthens our association with advertisers. Over the years, there has been a drastic improvement in our advertising income and the overall profitability of our organisation. As we

forge ahead, our aim is to maximise revenue streams to drive increase in monetisation of footfalls.

Even as cinema exhibition is our core business, creating ‘entertainment destinations’ – and not just cinemas – is fundamental to our strategy. We are committed to developing one of the world’s premier cinema circuits that will continue to generate strong returns. While viewing of movies straddles a wide diaspora, we seek to widen the appeal of going to the movies by creating “new concept cinemas” that will attract an even broader demographic. The development of premium experiences through design, structure, digital technology, food & beverage and personalised services makes our movie theatres ideal entertainment centres for all.

Annual Report 1516

Leveraging Industry Dynamics to Strengthen Presence

Our Inherent StrengthsWe belong to the US$ 3 Billion professionally managed INOX Group, with a legacy of over 90 years. We are one of the largest multiplex operators in India, catering to 53.4 million patrons in FY2016. Nearly 48% of our properties are in Top 10 cities. We have a competitive edge in the marketplace with a significant pan-India presence, adoption of state-of-the-art technology, unparalleled service and ambience, strong brand partnerships and a robust pipeline of new screens. We are currently present across 57 cities in India. We are one of the largest cinema exhibitors in the business and our distribution spread includes 108 properties, 425 screens in 57 cities, with a capacity of 109,406 seats. From 119 screens and 32 properties in FY2010, our network expanded to 420 screens and 107 properties in FY2016. We added an average of 3 screens per month over the last decade.

Our Performance MetricsDuring the year under review, we performed well across all operating metrics. Revenues jumped 31% during the year, EBITDA rose 55% and PAT was up 287%. SPH rose from ` 55 to ` 58 during the year, whereas aggregate footfalls increased 30%, driven by new screens and acquisitions. Even distribution of our screen portfolio across cities is ensuring growth in ATP. Our occupancy levels grew from 25% in FY2015 to 29% in FY2016. In the future, our focus areas will be increasing SPH, besides adding revenue and footfalls.

The most significant drivers of growth in the Indian film industry are differentiated content, wider release across digital screens and coordinated release of movies. The Indian film exhibition industry is performing well with the highest footfalls and number of films released across the globe. Growth in working population, rising per capita incomes and propensity to spend are the key factors driving growth in Indian multiplexes.

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31% Rise in Revenues

` 170 Average Ticket Price

` 58 Spend Per Head

53.4 MnFootfalls

12.1% to

14.3%EBITDA Margin improved

2.0% to

5.8%PAT Margin improved

6.1% to

12.4%ROCE improved

3.8% to

12.2%ROE improved

Our FY2016 Scorecard

India’s Low Screen Density (Number of Screens Per Million)

8

125

95

80

60 57

4026 25

16 12 10

US France

Source: Crisil Report, FICCI White Paper

Spain UK Germany South Korea

Japan Taiwan China Thailand Brazil India

Rising Footfalls (in Mn) Movie Releases

India’s Ranking in World Film Industry

2,178

1,602

1,930

745

1,364

476208 279 176

324171

554

169 204 156 241

China USA JapanIndia UKFrance South Korea Germany

Source: Crisil Report, FICCI White Paper

Annual Report 1516

Scaling Higher through Organic and Inorganic Growth

Our business currently accounts for nearly 20% share of multiplex screens in India and 8% share of Box Office collections. Moving ahead, we are poised for growth with a target of adding 59 screens in FY2017 that will grow our screen count to 479.

India continues to have a lower screen density as compared to the overseas markets, thereby creating opportunities for increasing presence across regions. We have robust plans to expand our footprint and increase our revenues by adding new locations and screens at a rapid pace . During the year, we added 51 screens to our portfolio, increasing our total screen count to 420. Today, our business accounts for nearly 20% share of multiplex screens in India and 8% share of Box Office collections. We are poised for growth with a target of adding 59 screens in FY2017 to grow our screen count to 479. The acquisition of Satyam Cineplex during FY2014 increased our multiplex density by

city to establish our position as a leading chain of multiplexes in the northern belt of India, particularly in the Delhi region. It enabled us to consolidate our industry position and increase traction in different regions, besides driving synergies through improvements in the F&B supply chain, higher advertising revenues and lower overheads.

Organic and Inorganic GrowthAs India moves forward, the growth of various industries is expected to be driven by these markets. Therefore, we will continue to develop our presence in Tier 2 & 3 cities to cash in on the rising disposable incomes in these cities. We are revamping our old and iconic properties in prime locations, such as the INOX multiplex at Nariman Point, Mumbai; the 9-screen multiplex at R City Mall, Ghatkopar, Mumbai; and the Nehru Place multiplex at Delhi. We also remain well positioned to pursue strategic acquisitions – those that are lucrative and enable us

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capitalise on our core business strengths – by virtue of our strong balance sheet and low leverage ratio. This will not only contribute positively to our business, but also provide access to customers and clients in newer provinces.

Maximising FootfallsWe have also implemented in-theatre initiatives to improve the overall entertainment experience of our guests. These include increased premium offerings, enhanced in-theatre services, differential pricing strategy, optimised product offerings and improved service execution. In order to maximise revenues, we are creating innovative pricing models by adopting an alternate pricing strategy for weekdays and weekends. Therefore, we intend to maximise footfalls through the week.

`

Stadium-styled high back seating with cup holder arm rests

Consistently high service standards

Interiors of international standards

Computerised ticketing

Unmatched service and

ambience

A selection of Hindi, English

and regional movies

High levels of hygiene

Varied theatre food

Serving our Customers Well

02 03

0607

01

08

04

05

Annual Report 1516

Maximising Revenue Streams to Enhance Profitability

Growth of non-Box Office revenues – cinema advertising and F&B – continues to be our strategic priority to de-risk revenues. Our revenue contribution from advertising and F&B has increased substantially over the years. Our margins on revenue streams other than ticket collections – including F&B and advertising – are higher, contributing significantly to our profitability. During FY2016, F&B contributed 19.9% to our total revenues, compared to 18.8% in FY2015.

67.9% Ticket Sales

6.8% Advertising

19.9% F&B

5.3% Others

What contributed to our Aggregate Revenue in FY2016

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Non-Box Office Revenue StreamsOur F&B revenue per footfall increased from ` 55 in FY2015 to ` 58 in FY2016 due to a combination of increase in the variety of offerings and improved quality. We took initiatives to improve F&B revenue by changing the menu based on the movie, having a larger menu spread and providing on-seat delivery. We also provide a choice of international, Indian and city-centric special flavours. Our advertising revenue grew from ` 814.9 Million in FY2015 to ` 910.1 Million in FY2016.

Future OutlookOur key strategy is to go beyond movies to reach customers in newer ways, maximise revenue per patron and increase the frequency of movie-going by driving downstream revenue opportunities. We will continue to maximise our revenue streams outside of the traditional theatre exhibition model, with a clear focus on driving improvement in footfall monetisation. Strong content and higher footfalls will assist in upscaling advertising revenues. For increasing profitability, we are focusing on high value, long term deals and taking initiatives to monetise on-screen and off-screen advertising revenue, such as monetising our lobby areas to improve our advertising revenue per screen.

Initiatives to improve

z Hiking advertising rates

z Focussing on high value deals

z Targeting corporate segment

z Off-screen advertising

z Online booking revenue

Annual Report 1516

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Raising Exhibition StandardsDigitisation and technology are major contributors to the development of the industry. Our advanced technologies provide an immersive cinematic experience. We are the pioneers in development of state-of-the-art multiplex cinema complexes in India. We provide incredible, transformative technology incorporated into entertainment. Utilisation of latest sound systems, advanced projection technologies and digitised screens have elevated our cinema exhibition standards. Our digitally savvy consumers enjoy sophisticated Digital 3D and 2K, 4K projections along with high-frequency 7.1 surround sound.

As an extension of our strategy to create a premium customer experience, we have entered into a pact with IMAX Corporation to install five IMAX theatre systems in our theatres in Mumbai, Delhi, Kolkata and Bengaluru. This will further enhance the cinema viewing experience and further strengthen our position in the industry.

Our premium venues offer personalised service, equipped with ergonomically designed recliner seating and state-of-the-art projection and sound systems. We are consistently improving the quality of our theatre assets by renovating existing lobbies and screens and adding new screens to increase screen density. We are upgrading our locations and focusing on improvements that have the most tangible impact on our guest experience and our bottom line.

Delivering a Superior and Premium Entertainment Experience

Our objective is to get our audience to ‘LIVE THE MOVIE’ by exhibiting movies as they are meant to be seen – by ensuring that all the comedy, action and drama of the movies comes to life.

Adopting new technologies will continue to assist in reinventing the cinematic experience for customers by getting them closer to the action and narrative, creating an impact that lasts longer. We have also redesigned service offerings to attract new customers, increase frequency of visits of existing customers and maximise revenue per guest. As one of the most contemporary theatre exhibition organisations in India, we view the quality of our theatre assets as strategically important to the guest experience.

Our Drivers of premium entertainment experiences

Ambience

Programming

Video and audio quality

Annual Report 1516

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Industry Overview

India Media & Entertainment IndustryYear 2015 brought an affirmative change for the Indian Media & Entertainment (M&E) industry. Coming off the lukewarm days of 2014, the year 2015 was that of a comeback and an enthusiastic response from the audiences. It was that of rolling up one’s sleeves and getting down to task. The M&E sector grew by 12.8% to ` 1,157 billion in 2015, from ` 1,026 billion in 2014, according to the KPMG-FICCI Media and Entertainment Industry Report 2016. A healthy advertising environment, with around 15% growth – propelled several parts of the industry to unprecedented growth. Going forward, the industry is set to grow by 14.3% CAGR to ` 2,260 billion by 2020. Industry growth will be led by advertising revenue which is expected to grow to ` 994 billion at a CAGR of 15.9% by FY2020, as per the Report.

Film Industry – IndiaThe Film Industry in India grew by 9.3% in 2015, with Hollywood and regional releases primarily contributing to growth. Films are expected to grow at 10.5% CAGR in 2016. Lack of screen density is a key constraint to sustained growth, especially for Bollywood content. While exhibitors recorded a significant growth in regional and Hollywood film collections, the collection for Hindi films was almost flat as compared to the previous years. On the other hand, strong regional content seemed to have gained acceptance even among the non-native language speaking audience, thereby improving the share of regional films in the overall revenue pie.

Discussion & AnalysisMANAGEMENT’S

The Film Industry in India grew by 9.3% in 2015, with Hollywood and regional releases primarily contributing to growth. Films are expected to grow at 10.5% CAGR in 2016. Lack of screen density continues to be a key constraint to sustained growth, especially for Bollywood content.

Annual Report 1516

Film Exhibition Industry – IndiaThe Indian film industry is one of the biggest film production markets in the world, with over 400 production and corporate houses playing an integral role. The Indian film industry produces around 1,500 movies every year and is considered to have one of the fastest movie turnaround rates across the world.

Increasing Affinity for MultiplexesThe cinema exhibition industry in India consisted of 8,100 screens, of which 2,100 screens are multiplexes. Multiplexes account for 25% of the aggregate screen population, but contribute nearly 38% of the total box office revenues. The multiplex industry is concentrated, with top four players controlling approximately 73% of the total multiplex screens. Despite these favourable market conditions, the screen density and expenditure on movies per capita were well short of the global benchmark, indicating significant potential for growth. This untapped growth potential is further aided by an unfeasible cost structure and the unviable business model of single screen operators, forcing many to close down or convert into multi-screen properties. The increasing reach of multiplex operators in non-metro cities, screen digitisation and increase in disposable income and its accompanied rise in discretionary spending by consumers should propel future growth rate of the Indian film industry.

Content is KingBollywood showcased a few distinct content driven movies during the year, all of which did well at the box office. Considering an increase in ticket prices and options within the entertainment space, the domestic movie viewers have been as judicious as ever while watching films in cinema theatres.

Films in INOX with record business in FY2016:Hindi:o Bajrangi Bhaijaano Bajirao Mastanio Tanu Weds Manu Returnso Prem Ratan Dhan Payoo Airlift

English:o Jurassic Worldo Avengers - Age Of Ultrono Fast and Furious 7o Mission: Impossible – Rogue Nationo Spectre

Other Indian Languages:o Baahubali (Telugu)o Srimanthudu (Telugu)o Natasamrat Asa Nat Hone Nahi (Marathi)o S/O Satya Murthy (Telugu)o Rudhramadevi (Telugu)o Naannaku Prematho (Telugu)

The increasingreach of multiplex operators in non-metro cities, screen digitisation and increase in disposable income and its accompanied rise in discretionary spending by consumers should propel future growth rate of the Indian film industry.

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Engaging with the AudienceIn today’s times, companies are exploring innovative means to engage with the target audience. There are abundant advances taking place in the smartphone and tablet space, as well as app and cloud based technologies, presenting significant opportunities for enhancing customer experience and engagement. Technology savvy audiences demand crystal clear projection, distortion free immersive sound and great acoustics. The multiplex industry is rising to the challenge and doing its best in integrating the most advanced in class technology for the best possible cinematic experience.

Ancillary Revenue StreamsHaving been through the stage of consolidation, film exhibitors are now focusing on organic screen additions and various other ancillary revenue streams such as online ticket sales, richer and more varied food offerings in the menu, in-cinema advertising and other value-added services to boost growth. It is imperative for the Government and the industry to work towards pioneering breakthroughs to increase screen presence and harness its true potential. The rise of online ticketing has been very significant and its contribution in the industry has gone up from 6% in 2006 to 32% in 2016.

What Sustains Box Office Growth• Improvement in content quality• Investments made by leading multiplex chains in setting up best-in-class

infrastructure in existing and under-served markets• Wide coverage of movie exhibition, backed by digital technology• Favourable demographics and higher disposable incomes, leading to higher

discretionary spends• Fewer alternative entertainment options other than movie theatres• Presence of movie culture as a social phenomenon in India

Growth Drivers for the Indian Film IndustryDomestic theatrical revenues have always been an integral part of the Indian Film Industry. As much as 73% of the aggregate revenue comes from domestic theatrical collection. Further, the valuation of other revenues streams also depends on the

Film exhibitors are focusing onorganic screen additions and other ancillary revenue streams such as onlineticket sales, richer and more varied food offerings in the menu, in-cinema advertising and other value-added services to boost growth.

Annual Report 1516

domestic box office performance of the film. Digital distribution of content has increased the audience reach and has enabled film exhibitors to earn revenues faster through same day pan-India releases. Digital distribution also helps in curbing leakage due to piracy.

The advertising market in India is currently valued at ` 45,000 crore. Of this, a meager 1% is spent on film advertising, indicating the vast market opportunity. Advertising during movie shows is largely carried out in bigger metro towns and is still an under-penetrated market. The revenue generation potential from advertising varies depending on the size of the film and potential for success. As per industry estimates, the size of the in-cinema advertising market is currently estimated to be about ` 4.5 billion, comprising 3.1% of the total box office collection. The market is seen growing at ~20% CAGR over FY2015-18E to reach ` 8 billion.

The Food & Beverages (F&B) is an established segment in multiplexes due to the choice they offer to patrons. The variety of food offered in our cinema halls makes us like a Quick Service Restaurant (QSR), with varied menu. In order to avoid menu fatigue, our multiplexes change the food menus at regular intervals, based on the movie running in the cinema hall and also the season. Hence, these high-margin revenue streams are crucial for the profitability of the overall establishment of a multiplex.

Implementation of GSTThe implementation of nation-wide Goods and Services Tax (GST) is expected to have a remarkable impact on the Exhibition Industry. GST will subsume some of the major Central and State Taxes such as Entertainment Tax, Service Tax, Value Added Tax, Central Sales Tax, Entry Tax and Octroi which affects the multiplex industry. Rates and statues of these taxes are different at Central and States as on date. With the current deliberations around GST rate being in the range of 18% to 20%, there could be a reduction of tax incidence for the multiplex industry. Further, the industry will be able to set off the taxes paid for expenses such as Lease Rent, Maintenance and other charges which affects the Profit & Loss for Multiplex Companies as of now. Overall, the GST is expected to add 2% to 4% to the EBITDA margins depending on the GST Rate. Additionally, the industry will have ease of doing business due to uniformity of Tax Laws in the country.

The size of the in-cinema advertising market is currently estimated to be about ` 4.5 billion, comprising 3.1% of the total box office collection. The market is seen growing at ~20% CAGR over FY2015-18E to reach ` 8 billion.

27

Company OverviewINOX Leisure Limited (INOX), a part of the INOX Group, is one of the largest players in the Indian multiplex industry. As of date, we operate 108 multiplexes and 425 screens in 57 cities. Our geographical presence and pan-India reach is evident from the properties we operate – 41 properties in West India, 25 in North, 24 in South and 18 in the East. INOX has a 20% market share in multiplex screens and ~8-9% share in domestic box office collections.

INOX – At a Glance• State-of-the-art facilities in modern projection and acoustic systems• Interiors of international standards• Stadium-styled high back seating with cup holder arm rests• High levels of hygiene• Varied theatre food• A selection of Hindi, English and regional movies• Computerised ticketing with high-end services to book tickets online and

introduction of paperless ticket entry

Our Aggressive Growth Plans• Strong improvement in Average Ticket Price (ATP) and Spend Per Head (SPH)• Addition of 51 screens in FY2016• Commenced consolidation phase in the multiplex business, strong ability to take

this forward, with an unleveraged balance sheet and robust promoter group support

What Differentiates UsStrong ManagementThe Company is part of the US$ 3 billion INOX Group which operates in various businesses, including industrial gases, engineering plastics, refrigerants, chemicals, cryogenic engineering, renewable energy and entertainment sectors. The Group includes three public-listed companies – Gujarat Fluorochemicals Limited, INOX Wind Limited and INOX Leisure Limited. It employs around 9,000 people at more than 150 business units across India.

Rising Occupancy RatesOur occupancy rate has improved from 25% in FY2012 to 29% in FY2016. Our endeavour is to maintain high occupancy rates. Owing to efficient programming of movies, we are able to run 5 shows per day/per screen. As more screens get added to our portfolio, and also with length of movies reducing and number of shows per day increasing, there are more options available to a consumer, which in turn increases our occupancy rates and aggregate capacity. Our marketing activities also offer increased convenience to the movie goers.

Our Strategies in Play Strong Visibility from New ScreensWe are adding screens to increase our presence across India. Over the past three years, on an average we have added ~47 screens per annum. Going forward, our target is to add ~50-60 screens per annum, which will drive footfall growth. Footfalls are being driven by the addition of more screens and regular organic growth. Visibility from new screens is being backed by signed agreements.

We are one of the largest players in the Indian multiplex industry. We operate 108 multiplexes and 425 screens in 57 cities.

19 States

57 Cities

108 Multiplexes

425 Screens

109,406 Seats

Over

53.4 Mn. Patrons

Annual Report 1516

Improving Advertising Revenue Per ScreenOur advertising revenue almost doubled from ` 1.3 million per screen in FY2012 to ` 2.5 million per screen in FY2016. We increased our advertising rates in December 2015, which will result in an increase in our advertising revenue in FY2017. We expect that higher advertising rates will be accepted by advertisers on the back of strong content, leading to higher footfalls.

Bettering F&B RevenuesWe operate a well-managed in-house F&B segment, delivering gross margin of ~75%. We have taken various initiatives to improve our F&B revenues such as changing menu based on theme of the movie playing, a wider menu spread and having a food app embedded in the INOX app. We foresee growth in this segment, led by expansion and higher conversion of footfalls into F&B spends.

What Stands us Apart:• Unique variety of food with choice of International, Indian and city-centric cuisine• No menu fatigue - Variety in menu for week days and weekends• Season specific food festivals• Investment in quality machines to serve best popcorn• Considerably reduced queue size and transaction time with in-app F&B ordering

and Qbuster service• Contribution of F&B revenues to net revenues increased from 18% to 20% over

the last 5 years

Our Value Drivers for GrowthRising Market OpportunityIndia has a population of ~1.2 billion, growing at 1.3% per year. The demographic statistics are favourable, with 35% of the population in the working category. Of the total 8,100 screens in India, 2,100 are in multiplex format and the rest are single screens, which provides a huge opportunity for the growth of multiplex players. Watching movies in a theatre is the prime entertainment option for people in India. The country is one of the world’s largest film entertainment market (with over 1,600 movie releases and around 2 billion footfalls annually).

The average ticket price is ~US$ 1 for a single screen and US$ 2.6 for a multiplex. The multiplex segment is highly organised and largely dominated by four key players (combined screen count of 1,484).

Increasing Acceptance of 3D ExhibitionOver the last few years, a steep rise in 3D movies is resulting in increased footfalls year on year.

Operational Performance – Delivering the BusinessThe Company has signed a five-screen deal with IMAX Corporation for IMAX® theatres. According to the deal, the IMAX screens will be added to existing INOX multiplexes in the cities of Mumbai, Bangalore, Delhi and Kolkata. With this deal, INOX is seen taking the cinema viewing experience of its customers to a much higher level. By associating ourselves with the IMAX brand and offering our guests a completely immersive cinema experience, we continue to strengthen our position.

Our advertising revenue almost doubled from ` 1.3 million per screen in FY2012 to ` 2.5 million per screen in FY2016. We increased our advertising rates in December 2015, which will result in an increase in our advertising revenue in FY2017.

29

Key Threats & ConcernsTicket pricing and show timings regulated by select StatesIn a few States, the Governments regulate ticket pricing and show timing. The M&E industry is hoping that State Governments will relax regulations that limit the number of shows and cap ticket pricing, and allow exhibitors to fix admission rates and show timings, according to demand and supply. Flexible pricing and show timings will help optimise occupancies and grow tax collections. The recent announcement of the Central Government of new Model Law that will allow, inter alia, Cinema Halls in Shopping Malls to be open 24X7 will help overcome the impediment.

High taxation restrains sector’s growthHigh entertainment tax acts as an impediment to growth of the film exhibition industry. Entertainment taxes in India continue to be higher than in most comparable economies. With the introduction of GST, the concern is expected to be addressed.

Timely execution of expansion plans We plan to take up space in various upcoming malls. Any delays in construction and completion of these malls will impact the execution of our roll-out plans.

Quality of contentGood quality content is the key driver of footfalls in multiplexes.

Escalating rental costs Rental costs have seen an upward trend for most multiplexes. The escalation in rents is leading to pressure on margins and impacting profitability.

With this IMAX deal, INOX is seen taking the cinema viewing experience of its customers to a much higher level. By associating ourselves with the IMAX brand and offering our guests a completely immersive cinema experience, we continue to strengthen our position.

Annual Report 1516

Management OutlookWe are moving towards our next phase of growth with footfalls, ATP and SPH set to improve year on year. This will be driven by screen additions across the country, higher contribution from 3D movies and better performing content. Our acquisition of Satyam in North India will further increase our superior bargaining power with advertisers, leading to higher earnings growth. Also, an improvement in our operating metrics will better our return ratios. With increased aggression, we believe we are well positioned to gain further market share in the film exhibition business in India.

Financial OverviewIncome from Operations increased by 31% – from ` 10,168.1 million in FY2015 to ` 13,326.9 million in FY2016. The rise in revenues was driven by healthy increase in Gross Box Office and Food & Beverage revenues on the back of increasing average ticket prices and spending per head which grew by 4% and 5%, respectively, during the financial year under review. Footfalls increased from 41.1 million in FY2015 to 53.4 million in FY2016, registering a growth of 30%, which positively improved the occupancy rate from 25% in FY2015 to 29% in FY2016.

Earnings before Interest Tax Depreciation and Amortisation (EBITDA)EBITDA increased by 54.7% from ` 1,227.7 million in FY2015 to ` 1,899.1 million in FY2016. EBITDA margin year increased by 218 basis points at 14.3% compared to 12.1% in FY2015. The improved performance from the Food & Beverages segment contributed significantly to the increase in EBITDA margins.

Profit after Tax (PAT)PAT increased by 286.7% from ` 200.4 million in FY2015 to ` 774.9 million in FY2016. PAT increased primarily on account of decrease in Interest Expense by 36.8% and increase in Operating Profit.

We are moving towards our next phase of growth with footfalls, ATP and SPH set to improve year on year. This will be driven by screen additions across the country, higher contribution from 3D movies and better performing content.

31

Human ResourcesOur organisational culture is fully geared to move into a space of growth, culture and strategy. We are encouraging our workforce to innovate and achieve the short-term and long-term objectives. Through our strategic HR processes, our aim is to achieve our business goals. Our human resources department is currently being driven through online systems. In another initiative, we have built an HR ecosystem with department-wise Standard Operating Procedures.

Our Key Initiatives:• With a key focus on employee development, we are nurturing our human capital

and creating a talent pool to drive business goals.• Training is increasingly imparted to employees to inculcate and implement

processes, enhance the usage of systems and keep pace with technological developments.

• We are also inculcating a culture of high-performance within the organisation through effective internal communication with stakeholders and making them highly accountable.

• We are increasingly focusing on attracting corporate and qualified talent with cross-industry experience.

• With a scalable business, we are able to showcase the career path and progression to each of our employees.

• We are continually focused on professional and personal development programs and in creating performance-driven employees by making the work environment faster and smoother.

Risk Management & Internal ControlsWe believe that sound internal controls and systems are related to the principle of good governance, and should be exercised within a framework of proper checks and balances. Accordingly, your Company has devised and implemented such internal control systems as are required in its business processes. The adequacy of these is being commented upon by the Statutory Auditors in their report. The Company remains committed to ensuring a reasonably effective internal control environment that provides assurance on the operations and safeguarding of its assets. The internal controls have been designed to provide assurance with regard to recording and providing reliable financial and operational information, complying with the applicable statutes, safeguarding assets, executing transactions with proper authorisation and ensuring compliance with corporate policies.

Cautionary StatementThis document contains statements about expected future events, financial and operating results of INOX Leisure Limited, which are forward-looking. By their nature, forward-looking statements require the Company to make assumptions and are subject to inherent risks and uncertainties. There is significant risk that the assumptions, predictions and other forward-looking statements will not prove to be accurate. Readers are cautioned not to place undue reliance on forward-looking statements as a number of factors could cause assumptions, actual future results and events to differ materially from those expressed in the forward-looking statements. Accordingly, this document is subject to the disclaimer and qualified in its entirely by the assumptions, qualifications and risk factors referred to in the management’s discussion and analysis of INOX Leisure Limited’s Annual Report, 2015-16.

We are encouraging our workforce to innovate and achieve the short-term and long-term objectives. Through our strategic HR processes, our aim is to achieve our business goals.

Annual Report 1516

BOARD OF DIRECTORSMr. Pavan Jain Chairman

Mr. Vivek Jain Non-Executive Director

Mr. Deepak Asher Non-Executive Director

Mr. Siddharth Jain Non-Executive Director

Mr. Haigreve Khaitan Independent Director

Mr. Amit Jatia Independent Director

Mr. Kishore Biyani Independent Director

Ms. Girija BalakrishnanIndependent Director

CHIEF EXECUTIVE OFFICER Mr. Alok Tandon

CHIEF FINANCIAL OFFICERMr. Upen Shah

VICE PRESIDENT - LEGAL &COMPANY SECRETARYMr. Dhanraj Mulki

AUDITORSM/s. Patankar & Associates Chartered Accountants Firm Reg.No. 107628W Office No.19 to 23, 4th Floor, Gold Wings, S. No. 118/A, Plot No. 543, Sinhgad Road, Parvati Nagar, Pune – 411 030, Maharashtra, India. Tel: +91 20 2425 2117 Fax: +91 20 24252118

REGISTRARS & TRANSFER AGENTKarvy Computershare Private LimitedKarvy Selenium Tower B, Plot 31-32, Gachibowli, Financial District, Nanakramguda, Hyderabad – 500 032

REGISTERED OFFICEABS Towers, Old Padra Road,Vadodara - 390 007

CORPORATE INFORMATIONCORPORATE OFFICE5th Floor, Viraj Towers, Next to Andheri Flyover, Western Express Highway, Andheri (E), Mumbai - 400 093

WEBSITE ADDRESSwww.inoxmovies.com

EMAIL ID FOR [email protected]

CORPORATE IDENTIFICATION NUMBER (CIN)L92199GJ1999PLC044045

BOARD LEVEL COMMITTEES:ILL Committee of the Board for OperationsMr. Pavan Jain, ChairmanMr. Siddharth Jain, MemberMr. Deepak Asher, MemberMr. Haigreve Khaitan, Member

Audit CommitteeMr. Haigreve Khaitan, ChairmanMr. Amit Jatia, MemberMr. Kishore Biyani, MemberMr. Deepak Asher, Member

Compensation, Nomination & Remuneration CommitteeMr. Haigreve Khaitan, ChairmanMr. Amit Jatia, MemberMr. Siddharth Jain, Member

Stakeholders’ Relationship CommitteeMr. Pavan Jain, ChairmanMr. Siddharth Jain, MemberMr. Deepak Asher, Member

Corporate Social Responsibility (CSR) CommitteeMr. Pavan Jain, MemberMr. Deepak Asher, MemberMr. Haigreve Khaitan, Member

33

Annual Report 1516

Notice

INOX LEISURE LIMITED(CIN: L92199GJ1999PLC044045)

Regd. Office: ABS Towers, Old Padra Road, Vadodara – 390 007.Telephone: 0265 6198111 | Fax: 0265 2310312

Website: www.inoxmovies.com | Email ID: [email protected]

Notice is hereby given to the Members of INOX Leisure Limited that the Seventeenth ANNUAL GENERAL MEETING of the Company will be held at Maple Hall, Hotel Express Residency, 18/19, Alkapuri Society, Vadodara – 390 007 on Saturday, 24th September, 2016 at 12.00 noon to transact the following business:

ORDINARY BUSINESS:

1. Adoption of Financial Statements.

To consider and adopt

a. the Audited Standalone Financial Statements of the Company for the Financial Year ended 31st March, 2016, the reports of the Board of Directors and Auditors thereon; and

b. the Audited Consolidated Financial Statements of the Company for the Financial Year ended 31st March, 2016 and the report of the Auditors thereon.

2. Re-appointment of Mr. Siddharth Jain as a Director of the Company.

To appoint a Director in place of Mr. Siddharth Jain (DIN: 00030202), who retires by rotation and being eligible, offers himself for re-appointment.

3. Ratification of appointment of Independent Auditors and to authorize the Board of Directors of the Company to fix their remuneration.

Toconsiderandifthoughtfit,topass,withorwithoutmodification,thefollowingresolutionasanOrdinaryResolution.

“RESOLVED THAT pursuant to the provisions of Section 139, 141, 142, and other applicable provisions, if any, of the CompaniesAct,2013,andtheCompanies(AuditandAuditors)Rules,2014, includinganymodification,variationorre-enactment thereof, the appointment of M/s. Patankar & Associates, Chartered Accountants, Pune (Firm Registration No. 107628W), as Independent Auditors of theCompany be and is hereby ratified, to hold office from the conclusion ofSeventeenth Annual General Meeting until the conclusion of the Eighteenth Annual General Meeting of the Company andthattheBoardofDirectorsoftheCompanybeandareherebyauthorizedtofixtheirremuneration,basedontherecommendation of Audit Committee, including reimbursement of actual out of pocket expenses, in connection with the audit of accounts for the Financial Year ending 31st March, 2017.”

SPECIAL BUSINESS

4. To approve the payment of professional fees to Mr. Deepak Asher (DIN: 00035371), Non-executive Director of the Company.

Toconsiderand,ifthoughtfit,topass,withorwithoutmodification,thefollowingresolutionasaSPECIAL RESOLUTION:

“RESOLVED THAT pursuant to the provisions of Section 197 and all other applicable provisions of the Companies Act, 2013 (hereinafter referred to as the “Act”), the Rules made thereunder and pursuant to the provisions of Regulation 17 (6) (a) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), consent of the Members of the Company be and is hereby given for payment of Professional Fees of ` 2,50,000/- (Rupees Two Lacs Fifty Thousand only) per month, plus taxes as may be applicable, to Mr. Deepak Asher (DIN 00035371), Non-executive Director of the Company for the Financial Years 2017-18, 2018-19 and 2019-20 for availing of his professional services for strategic business planning, formulation and implementation of various growth strategies for the Company as well as financialplanningandmanagementoftheCompany.

RESOLVED FURTHER THAT the above professional fees shall be exclusive of sitting fees payable to Mr. Deepak Asher, Non-Executive Director, for attending meetings of the Board or any Committees thereof.

Notice

RESOLVED FURTHER THAT Mr. Pavan Jain, Mr. Vivek Jain and Mr. Siddharth Jain, Directors of the Company be and are herebyseverallyauthorizedtofinalizetheothertermsandconditionsofthisengagementincludingrenewalthereofandtakeall such steps as may be necessary, proper and expedient to give effect to this resolution.”

5. Grant of employee stock options to the employees of the Holding and Subsidiary Company(ies) of the Company under ILL – EMPLOYEE STOCK OPTION SCHEME – 2006.

Toconsiderand,ifthoughtfit,topass,withorwithoutmodification,thefollowingresolutionasaSPECIAL RESOLUTION:

“RESOLVED THAT pursuant to the provisions of Section 62(1)(b) and all other applicable provisions, if any, of the Companies Act, 2013 read with Rules framed thereunder (including any statutory modification(s) or re-enactment(s)thereof for the time being in force), the Memorandum and Articles of Association of the Company, Securities and Exchange BoardofIndia(ShareBasedEmployeeBenefits)Regulations,2014asamendedfromtimetotime(hereinafterreferredtoas“SBEB Regulations”) and subject to such other approvals, permissions and sanctions as may be necessary and subject to such conditionsandmodificationsasmaybeprescribedorimposedwhilegrantingsuchapprovals,permissionsandsanctions,which may be accepted by the Board of Directors of the Company (hereinafter referred to as the “Board” which term shall be deemed to include any Committee, including the Compensation, Nomination and Remuneration Committee which the Board has constituted to exercise its powers, including the powers, conferred by this resolution), approval and consent of the Members of the Company (“Members”) be and is hereby accorded to grant such number of employee stock options, in one or more tranches, under ILL – EMPLOYEE STOCK OPTION SCHEME – 2006' (hereinafter referred to as the “ILL ESOS 2006”/ “Scheme”) within the ceiling of employee stock options prescribed therein, to the employees of the Holding and Subsidiary Company/ies of the Company, whether working in India or abroad, unless they are prohibited from participating in the Scheme under any Law or Regulations for the time being in force, exercisable into corresponding number of equity shares of face value of ` 10/- (Rupees Ten) each fully paid-up, to be transferred by INOX Leisure Limited - Employees' Welfare Trust (“Trust”) from its existing shareholding on such exercise, on such terms and conditions, as may be determined by the Board in accordance with the provisions of the Scheme, SBEB Regulations and in due compliance with other applicable laws and regulations.

RESOLVED FURTHER THAT all actions taken by the Board in connection with the above and all incidental and ancillary thingsdoneareherebyspecificallyapprovedandratified.

RESOLVED FURTHER THAT the Board be and is hereby also authorized at any time to modify, change, vary, alter, amend, suspend or terminate the ILL ESOS 2006 subject to the compliance with the applicable laws and regulations and to doallsuchacts,deeds,mattersandthingsasitmayinitsabsolutediscretiondeemfit,forsuchpurposeandalsotosettleanyissues,questions,difficultiesordoubtsthatmayariseinthisregardwithoutbeingrequiredtoseekanyfurtherconsentorapproval of the Members and further to execute all such documents, writings and to give such directions and/or instructions asmaybenecessaryorexpedienttogiveeffecttosuchmodification,change,variation,alteration,amendment,suspensionor termination of the ILL ESOS 2006 and do all other things incidental and ancillary thereof.

RESOLVED FURTHER THAT the Company and Trust shall conform to the accounting policies prescribed from time to time under the SBEB Regulations and any other applicable laws and regulations to the extent relevant and applicable to the ILL ESOS 2006.

RESOLVED FURTHER THAT any Director of the Company or Company Secretary, be and are hereby severally authorised, to do all such acts, deeds, matters and things as may be necessary, expedient and usual for the purpose of giving effect to this resolution.”

By order of the Board of DirectorsFor INOX Leisure Limited

Dhanraj MulkiPlace: Mumbai Vice President – Legal Date: 8th August, 2016 & Company Secretary

35

Annual Report 1516

Notice

NOTES:1. A Member entitled to attend and vote at the Annual General Meeting (“Meeting”) is entitled to appoint one or more proxies

to attend and vote on a poll only instead of himself/herself and a proxy need not be a Member. Proxies, in order to be effective,mustbereceivedattheRegisteredOfficeoftheCompanynotlessthan48hoursbeforethecommencementofthe Meeting.

2. ApersoncanactasaProxyonbehalfofMembersnotexceedingfifty(50)andholdingintheaggregatenotmorethantenpercent (10%) of the total share capital of the Company carrying voting rights. However, a Member holding more than ten percent (10%) of the total Share Capital of the Company carrying voting rights may appoint a single person as a Proxy and such person shall not act as a Proxy for any other person or Member.

3. The Statement pursuant to Section 102 (1) of the Companies Act, 2013, in respect of special business as per Item No. 4 & 5 hereinabove is annexed hereto.

4. The Register of Members and Share Transfer Books of the Company will remain closed from Saturday, 17th September, 2016 to Saturday, 24th September, 2016 (both days inclusive).

5. Appointment / Re-appointment of Directors: The information required to be provided under the Secretarial Standard – 2/ Listing Regulations in respect of Director/s

being appointed/re-appointed is given herein below and also in the Corporate Governance Report:

Name of the Director Mr. Siddharth Jain Mr. Deepak Asher

Date of Birth and Age 21st September, 197837 Years

15th January, 195957 Years

Dateoffirstappointmenton the Board

10th September, 2004 15th January, 2000

Directors IdentificationNumber

00030202 00035371

Qualification Mr. Siddharth Jain has graduated from the University of Michigan - Ann Arbor, with a Bachelor of Science in Mechanical Engineering and has an MBA from INSEAD, France.

Mr. Deepak Asher, in addition to being a Commerce and Law graduate, is an eminent Chartered Accountant and Cost and Works Accountant.

Experience / Expertise in SpecificFunctionalArea

Mr. Siddharth Jain has over 16 years of work experience in various management positions.

Mr. Deepak Asher has more than 32 years’ of richexperienceinthefieldofstrategicbusinessplanning, formulation and implementation of various growth strategies as well as financialplanning and management. He is a Director and Group Head (Corporate Finance) of the INOX Group of Companies, comprising of three listed companies and three international joint ventures. He has been instrumental in setting up various businesses for the INOX Group including the cinema exhibition business, the renewable energy business and the path-breaking carbon credit business. He is a founder president of Multiplex Association of India and a Member of the FICCI Entertainment Committee.

Notice

Directorships held in other Companies

1. INOX FMCG Private Limited 2. INOX Air Products Private Limited 3. INOX India Private Limited 4. INOX Leasing and Finance Limited 5. Devansh Gases Private Limited6. Rajni Farms Private Limited7. INOX Wind Limited 8. INOX Consumer Products Private Limited

(with effect from 25th May, 2016)9. Megnasolace City Private Limited

1. Gujarat Fluorochemicals Limited2. INOX Wind Limited3. INOX Infrastructure Limited4. INOX Renewables Limited5. Swanston Multiplex Cinemas Private Limited6. INOX Renewables (Jaisalmer) Limited7. Satyam Cineplexes Limited

Membership / Chairmanship of Committees of other Companies

1. INOX India Private Limited – Member of Audit Committee

2. INOX Leasing & Finance Limited – Member of Stakeholders Relationship Committee & Audit Committee

1. Gujarat Fluorochemicals Limited – Member of Audit Committee & Stakeholders Grievance Committee

2. INOX Wind Limited – Member of Audit Committee & Stakeholders Grievance Committee

3. INOX Infrastructure Limited – Member of Audit Committee

4. INOX Renewables Limited – Member of Audit Committee

5. INOX Renewables (Jaisalmer) Limited - Member of Audit Committee

The number of Meetings of the Board attended during the year

6 7

Remuneration last drawn ` 1,20,000 towards sitting fees. ` 32,80,000 (including ` 2,80,000 towards sitting fees).

Relationship with other Directors, Manager and other Key Managerial Personnel of the Company

Related to Mr. Pavan Jain Not related to any Director or Key Managerial Personnel of the Company.

Shareholding in the Company

6,00,000 Equity Shares of ` 10 each. 25,000 Equity Shares of ` 10 each.

6. In compliance with provisions of Section 101 of the Companies Act, 2013 read with Rule 18 of the Companies (Management and Administration) Rules, 2014, Annual Report for the Financial Year 2015- 2016 of your Company has been sent via Electronic Mode (E-mail) to the Members whose E-mail ID was made available to us by the Depositories Participants. We request the Members to register / update their E-mail address with their Depository Participant, in case they have not already registered / updated the same. Members who are holding shares in physical form are requested to get their E-mail address registered with the Registrar and Share Transfer Agents.

37

Annual Report 1516

Notice

7. In compliance with provisions of Section 108 of the Companies Act, 2013 read with Rule 20 of the Companies (Management and Administration) Rules 2014, as amended, and Regulation 44 of the Listing Regulations, the Company is pleased to provide e-voting facility to all Members which has been provided through the e-voting platform of CDSL. In this regard, your demat account/folio number has been enrolled by the Company for your participation in e-voting on the resolutions placed by the Company on the e-voting system. Instructions and manner of e-voting process can be downloaded from the link https://www.evotingindia.com. E-voting is optional.Thee-votingrightsofthemembers/beneficialownersshallbereckoned on the equity shares held by them as on Saturday, 17th September, 2016.

The instructions for shareholders voting electronically are as under:

In case of Members receiving e-mail:

(i) The voting period begins on Wednesday, 21st September, 2016 at 09:00 a.m. and ends on Friday, 23rd September, 2016 at 5:00 p.m. During this period Members of the Company, holding shares either in physical form or in dematerialized form, as on the cut-off date of Saturday, 17th September, 2016 may cast their vote electronically. The e-voting module shall be disabled by CDSL for voting thereafter.

(ii) Shareholders who have already voted prior to the Meeting date would not be entitled to vote at the Meeting venue.

(iii) The Members should log on to the e-voting website www.evotingindia.com

(iv) Click on “Shareholders” tab.

(v) Now Enter your User ID

a. ForCDSL:16digitsbeneficiaryID,

b. For NSDL: 8 Character DP ID followed by 8 Digits Client ID,

c. Members holding shares in Physical Form should enter Folio Number registered with the Company.

(vi) NextentertheImageVerificationasdisplayedandClickonLogin.

(vii) If you are holding shares in demat form and had logged on to www.evotingindia.com and voted on an earlier voting of any company, then your existing password is to be used.

(viii) Ifyouareafirsttimeuserfollowthestepsgivenbelow:

For Members holding shares in Demat Form and Physical FormPAN Enter your 10 digit alpha-numeric *PAN issued by Income Tax Department (Applicable for both demat

shareholders as well as physical shareholders) y Members who have not updated their PAN with the Company/Depository Participant are requested to usethesequencenumberwhichisprintedonAttendanceSlipindicatedinthePANfield(attachedwithAnnual Report).

DOB Enter the Date of Birth as recorded in your demat account or in the company records for the said demat account or folio in dd/mm/yyyy format.

Dividend Bank Details

Enter the Dividend Bank Details as recorded in your demat account or in the company records for the said demat account or folio.

y Please enter the DOB or Dividend Bank Details in order to login. If the details are not recorded with the depositoryorcompanypleaseenterthememberid/folionumberintheDividendBankdetailsfieldasmentioned in instruction (iv).

(ix) After entering these details appropriately, click on “SUBMIT” tab.

(x) Members holding shares in physical form will then directly reach the Company selection screen. However, Members holding shares in demat form will now reach ‘Password Creation’ menu wherein they are required to mandatorily entertheirloginpasswordinthenewpasswordfield.Kindlynotethatthispasswordistobealsousedbythedematholders for voting for resolutions of any other company on which they are eligible to vote, provided that company opts for e-voting through CDSL platform. It is strongly recommended not to share your password with any other person andtakeutmostcaretokeepyourpasswordconfidential.

Notice

(xi) For Members holding shares in physical form, the details can be used only for e-voting on the resolutions contained in this Notice.

(xii) Click on the EVSN for the relevant <Company Name> on which you choose to vote.

(xiii) On the voting page, you will see “RESOLUTION DESCRIPTION” and against the same the option “YES/NO” for voting. Select the option YES or NO as desired. The option YES implies that you assent to the Resolution and option NO implies that you dissent to the Resolution.

(xiv) Click on the “RESOLUTIONS FILE LINK” if you wish to view the entire Resolution details.

(xv) Afterselectingtheresolutionyouhavedecidedtovoteon,clickon“SUBMIT”.Aconfirmationboxwillbedisplayed.Ifyouwishtoconfirmyourvote,clickon“OK”,elsetochangeyourvote,clickon“CANCEL”andaccordinglymodifyyour vote.

(xvi) Once you “CONFIRM” your vote on the resolution, you will not be allowed to modify your vote.

(xvii) You can also take a print of the votes cast by clicking on “Click here to print” option on the Voting page.

(xviii)IfademataccountholderhasforgottentheloginpasswordthenEntertheUserIDandtheimageverificationcodeandclick on Forgot Password & enter the details as prompted by the system.

(xix) Shareholders can also cast their vote using CDSL’s mobile app m-Voting available for android based mobiles. The m-Voting app can be downloaded from Google Play Store, iPhone and Windows phone users can download the app from the App Store and the Windows Phone Store respectively on or after 30th June 2016. Please follow the instructions as prompted by the mobile app while voting on your mobile.

(xx) Note for Non – Individual Shareholders and Custodians

• Non-Individual Shareholders (i.e. other than Individuals, HUF, NRI etc.) and Custodian are required to log on to www.evotingindia.com and register themselves as Corporates.

• A scanned copy of the Registration Form bearing the stamp and sign of the entity should be emailed to [email protected].

• After receiving the login details a Compliance User should be created using the admin login and password. The Compliance User would be able to link the account(s) for which they wish to vote on.

• The list of accounts linked in the login should be emailed to [email protected] and on approval of the accounts they would be able to cast their vote.

• A scanned copy of the Board Resolution and Power of Attorney (POA) which they have issued in favour of the Custodian, if any, should be uploaded in PDF format in the system for the scrutinizer to verify the same.

(xxi) In case you have any queries or issues regarding e-voting, you may refer the Frequently Asked Questions (“FAQs”) and e-voting manual available at www.evotingindia.com under help section or write an email to [email protected].

A. The voting rights of Members shall be in proportion to their shares of the Paid - Up Equity Share Capital of the Company as on the cut-off date of Saturday, 17th September, 2016. For all others who are not holding shares as on Saturday, 17th September, 2016 and receive the Annual Report of the Company, the same is for their information.

B. A copy of this Notice has been placed on the website of the Company and the website of CDSL.

C. M/s.SamdaniShah&Associates,PracticingCompanySecretary(CertificateofPracticeNumber2863)hasbeenappointed as the Scrutinizer for conducting the e-voting process in a fair and transparent manner.

D. TheScrutinizershall,immediatelyaftertheconclusionofvotingattheMeeting,firstcountthevotescastattheMeeting, thereafter unblock the votes cast through remote e-voting in the presence of at least two witnesses not in the employment of the company and make not later than three days of conclusion of the Meeting, a consolidated scrutinizer's report of the total votes cast in favour or against, if any, to the Chairman or a person authorised by him in writing who shall countersign the same. Chairman or a person authorised by him in writing shall declare the result of the voting forthwith.

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Annual Report 1516

Notice

E. The Results declared along with the Scrutinizer’s Report shall be placed on the Company’s website www.inoxmovies.com and on the website of CDSL and communicated to the BSE Limited and National Stock Exchange of India Limited.

(xxii) Member may address their grievances connected with the e-voting to Mr. Dhanraj Mulki, Vice President – Legal & Company Secretary, 5th Floor, Viraj Towers, Next to Andheri Flyover, Western Express Highway, Andheri (East), Mumbai – 400093, Email ID – [email protected], Phone Number – 02240626900.

8. Members holding shares in physical form are requested to intimate Registrar and Transfer Agents of the Company viz., M/s. Karvy Computershare Private Limited, Unit: INOX Leisure Limited, Karvy Selenium Tower B, Plot 31-32, Gachibowli, Financial District, Nanakramguda, Hyderabad – 500 032, changes, if any, in their Bank details, registered address, Email ID, etc. along with their Pin Code. Members holding shares in electronic form may update such details with their respective Depository Participant.

9. Members desiring any relevant information on the accounts at the Annual General Meeting are requested to write to theCompanySecretaryatleastsevendaysinadvanceatitsRegisteredOffice,soastoenabletheCompanytokeeptheinformation ready.

10. Members/ProxiesarerequestedtobringtheirfilledinAttendanceSlipandtheircopyofAnnualReporttotheMeeting.

11. Corporate Members intending to send their Authorised Representative(s) to attend the Annual General Meeting are requestedtosenddulycertifiedcopyoftheBoardResolutionauthorizingsuchrepresentative(s)toattendandvoteattheAnnual General Meeting.

12. Members holding shares in single name and in Physical form are advised to make nomination in respect of their shareholding in the Company.

13. The relevant documents referred to in the accompanying Notice of Meeting and in the Explanatory Statement are open for inspectionbytheMembersoftheCompanyattheRegisteredOfficeonallworkingdays(exceptSaturdays,SundaysandPublic Holidays) between 11.00 a.m. to 1.00 p.m. upto the date of this Meeting and copies thereof shall also be available forinspectioninphysicalformattheCorporateOfficeoftheCompanysituatedat5th Floor, Viraj Towers, Next to Andheri Flyover, Western Express Highway, Andheri (East), Mumbai – 400 093 and also at the Meeting.

14. The Chairman shall, at the Meeting, at the end of discussion on the resolutions on which voting is to be held, allow voting with the assistance of Scrutinizer, by use of “Ballot Paper” for all those Members who are present at the Meeting but have not cast their votes by availing the remote e-voting facility.

THE STATEMENT UNDER SECTION 102 (1) OF THE COMPANIES ACT, 2013:

ITEM NO. 4Sub-section (4) of Section 197 of the Companies Act, 2013 provides that the remuneration payable to the directors of the Company shall be determined, subject to provisions of this Section, either by articles of the Company or, if article so require, by a special resolution passed by the Company in general meeting and the remuneration payable to a director shall be inclusive of the remuneration payable to him for services rendered by him in any other capacity. The Proviso to this sub-section provides that any remuneration for services rendered by any director shall not be so included in computing ceiling limit as provided in the said Section, if the services rendered are of a professional nature; and in the opinion of Nomination and Remuneration Committee oftheCompany,adirectorpossessesrequisitequalificationforthepracticeoftheprofession.

Regulation 17 (6) (a) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations) states that all fees or compensation, if any, paid to non-executive directors, including independent directors shall be recommended by Board of Directors of the Company and shall require approval of Members in general meeting.

Notice

Accordingly, in compliance of Section 197 of the Act, Regulation 17 (6) (a) of the Listing Regulations, the Compensation, Nomination and Remuneration Committee of the Company and the Board of Directors of the Company at its respective Meetings held on 8th August, 2016 have passed resolutions, subject to the approval of the Members, to avail professional services of Mr. Deepak Asher, Non- Executive Director of the Company for strategic business planning, formulation and implementation of variousgrowthstrategiesaswellasfinancialplanningandmanagementconsideringhisprofessionalexpertiseandachievementsduring the tenure of his directorship with the Company and payment of professional fees to him.

Mr. Deepak Asher, in addition to being a Commerce and Law graduate, is an eminent Chartered Accountant and Cost and Works Accountantwithmorethan32years’ofrichexperienceinthefieldofstrategicbusinessplanning,formulationandimplementationofvariousgrowthstrategiesaswellasfinancialplanningandmanagement.HeisaDirectorandGroupHead(CorporateFinance)of the INOX Group of Companies, comprising of three listed companies and three international joint ventures. He has been instrumental in setting up various businesses for the INOX Group including the cinema exhibition business, the renewable energy business and the path-breaking carbon credit business. He is a founder president of Multiplex Association of India and a member of the FICCI Entertainment Committee.

Considering the above facts, it is recommended to approve payment of professional fees to Mr. Deepak Asher as mentioned in the proposed resolution.

Mr. Deepak Asher is interested in the resolution set out at Item No. 4 of the Notice with regard to payment of professional fees to him. The relatives of Mr. Deepak Asher may be deemed to be interested in the Resolution set out at Item No. 4 of the Notice, to the extent of their shareholding interest, if any, in the Company.

Save and except the above, none of the other Directors / Key Managerial Personnel of the Company / their relatives are, in any way,concernedorinterested,financiallyorotherwise,inthisresolution.

The Directors recommend the Resolution as stated at Item No. 4 of the Notice for approval of the Members by way of a Special Resolution.

ITEM No. 5 :The Company appreciates the critical role its people play in the organizational growth. It strongly believes in rewarding its employees including Directors of the Company as well as that of the Holding and Subsidiary Company(ies) for their continuous hard work, dedication and support, which has led the Company on the growth path.

In this context, it may be mentioned that an ESOP Scheme titled the “ILL - Employee Stock Option Scheme – 2006” (“ILL ESOS – 2006” / “Scheme”) was already approved by way of a resolution passed at the Extra-ordinary General Meeting of the Company held on 4thJanuary,2007therebyextendingthebenefitoftheILL ESOS – 2006 to the employees including Directors of the Company.

ItisnowproposedtoextendthebenefitoftheILL ESOS – 2006 to the employees including Directors of the Holding and Subsidiary Company(ies) for rewarding their performance and motivate them to contribute to the overall corporate growth and profitability.

The Company seeks approval of the Members in respect of grant of employee stock options under ILL ESOS – 2006 to the eligible employees / Directors of its Holding and Subsidiary Company(ies) as may be decided by the Compensation, Nomination and Remuneration Committee (“Committee”) from time to time in due compliance with Companies, Act, 2013 (including rules framed thereunder), SBEB Regulations and other applicable laws and regulations.

AsrequiredunderRegulation6(2)oftheSBEBRegulations,followinginformationisbeingprovidedasspecifiedbySEBIinthisregard.

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Annual Report 1516

Notice

a. Brief description of the scheme(s); The Scheme is implemented from time to time primarily with a view to attract, retain, incentivise and motivate the key talents that would lead to higher corporate growth. The Scheme contemplates grant of Options to the eligible employees including Directors of the Company, its Subsidiary or Holding Company (collectively referred to as “Company” and shall be read as context requires) as may be determined in due compliance of SEBI (Share Based Employee Benefits) Regulations, 2014 (“SBEBRegulations”) and provisions of the Scheme. After vesting of Options, the eligible employees earn a right (but not obligation) to exercise the vested Options within the exercise period and obtain equity shares of the Company subject to payment of exercise price and satisfaction of any tax obligation arising thereon.

The Compensation, Nomination and Remuneration Committee (“Committee”) of the Company shall act as Compensation Committee for administration and superintendence of the Scheme. All questions of interpretation of the Scheme shall be determined by the Committee and suchdeterminationshallbefinalandbindinguponallpersonshavinganinterest in the Scheme. Company had established a Trust named “INOX Leisure Limited - Employees’ Welfare Trust” with a view to administer the Scheme. The Committee may delegate aspects of administration to theTrustasitdeemsfitasperapplicablelawsinwhichcasetheTrustshall have powers of administration.

b. The total number of options, SARs, shares or benefits,asthecasemaybe,tobegranted;

The total number of Options reserved under the Scheme was not more than 500,000 (Five Lakh) Options, for grant from time to time to eligible employees. Each Option when exercised would be converted into one Equity Share of ` 10/- (Rupees Ten) each fully paid-up.

The SEBI Regulations require that in case of any corporate action(s) such as rights issues, bonus issues, merger and sale of division and others, a fair and reasonable adjustment needs to be made to the Options granted. In this regard, the Committee shall adjust the number and price of the Options granted in such a manner that the total value of the Options granted under Scheme remain the same after any such corporate action. Accordingly, if any additional Options are issued by the Company to the Option grantees for making such fair and reasonable adjustment, the ceiling aforesaid shall be deemed to be increased to the extent of such additional Options issued.

c.Identificationofclassesofemployeesentitledtoparticipateandbebeneficiariesinthescheme(s);

All the permanent employees (including a Director, whether whole-time or not) of the Company, its holding company and subsidiary company(ies), working in India or outside India shall be eligible to participate in the Scheme. Provided however that the following persons shall not be eligible to participate in Scheme:i. an employee who is a Promoter or belongs to the Promoter Group

asdefinedintheSBEBRegulations;orii. a Director who either by himself or through his relatives or through

any body corporate, directly or indirectly holds more than 10% of the issued and subscribed Equity Shares of the Company; or

iii. Independent Directors.

Notice

d. Requirements of vesting and period of vesting; All the Options granted on any date shall vest not earlier than 1 (one) yearandnotlaterthanamaximumof5(five)yearsfromthedateofgrantof Options as may be determined by the Committee. The Committee may extend, shorten or otherwise vary the vesting period from time to time, in accordance with the applicable laws and in the interest of the Option grantee.

The vesting dates in respect of the Options granted under the Scheme shall be determined by the Committee and may vary from employee to employee or any class thereof and / or in respect of the number or percentage of Options granted to an employee.

Options shall vest essentially based on continuation of employment and apart from that the Committee may prescribe achievement of any performance condition(s) for vesting. The exact terms on vesting shall be mentioned in the grant letter.

e. Maximum period (subject to regulation 18(1) and 24(1) of the SBEB Regulations, as the case may be) withinwhich theoptions /SARs /benefitshallbevested;

All the Options granted on any date shall vest not later than a maximum of5(five)yearsfromthedateofgrantofOptionsasmaybedeterminedby the Committee.

f. Exercise price, SAR price, purchase price or pricing formula;

Exercise price per Option shall be ` 15.

g. Exercise period and process of exercise; The Exercise period would commence from the date of vesting and will expire on completion of 1 (One) year from the date of respective vesting or such other shorter period as may be decided by the Committee from time to time.

The vested Option shall be exercisable by the employees by a written application to the Company or Trust expressing his/ her desire to exercise such Options in such manner and on such format as may be prescribed by the Committee from time to time. The Options shall lapseifnotexercisedwithinthespecifiedexerciseperiod.

Please note that the exercise period is shorter in case of separation from employment of the Company which are dealt with in greater detail in the Scheme.

h. The appraisal process for determining the eligibility of employees for the scheme(s);

The appraisal process for determining the eligibility shall be decided from time to time by the Committee. The broad criteria for appraisal and selection may include parameters like tenure of association with the Company or the holding and subsidiary company(ies) of the Company, performance during the previous years, contribution towards strategic growth, contribution to team building and succession, cross-functional relationship, corporate governance, etc.

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Annual Report 1516

i. Maximum number of options, SARs, shares, as the case may be, to be issued per employee and in aggregate;

The number of options that may be granted to any specific optiongrantee under the Scheme shall not exceed 1% of the issued capital (excluding outstanding warrants and conversions) of the Company at the time of grant of options.

j.Maximumquantumofbenefitstobeprovidedperemployee under the scheme(s);

Maximumquantumofbenefitstobeprovidedperemployeewilldependon various factors such as, number of options granted, price at the time of vesting and exercise of options, etc.

k. Whether the scheme(s) is to be implemented and administered directly by the company or through a trust;

Through INOX Leisure Limited – Employees Welfare Trust

l. Whether the scheme(s) involves new issue of shares by the company or secondary acquisition by the trust or both;

Scheme involves transfer of shares from the INOX Leisure Limited – Employees Welfare Trust to the option grantees.

m. The amount of loan to be provided for implementation of the scheme(s) by the company to the trust, its tenure, utilization, repayment terms, etc.;

The Company had given Loan of ̀ 75,00,000 to the INOX Leisure Limited – Employees Welfare Trust for implementing the Scheme. Amount of loan outstanding (repayable to company) as at the end of the year is ` 44,25,015.

n. Maximum percentage of secondary acquisition (subject to limits specified under the regulations)that can be made by the trust for the purposes of the scheme(s);

Not Applicable

o. A statement to the effect that the company shall conform to the accounting policies specified inregulation;

ThecompanyshallconformtotheaccountingpoliciesspecifiedintheSBEB Regulations.

p. The method which the company shall use to value its options or SARs;

Intrinsic Value Method, unless otherwise required by any applicable law in future.

q. Declaration So long as the company opts for expensing of share based employee benefits using the intrinsic value method, the difference betweenthe employee compensation cost so computed and the employee compensation cost that shall have been recognized if it had used the fair value of options, shall be disclosed in the Board's Report and the impact of thisdifferenceonprofitsandonearningsper share (“EPS”)of thecompany shall also be disclosed in the Board's Report.

Notice

In terms of provisions of Section 62(1) (b) and all other applicable provisions, if any, of the Companies Act, 2013, consent of the Members is being sought by way of a Special Resolution as set out at Item No. 5 of this Notice.

AcopyoftheSchemeisavailableforinspectionattheCompany’sRegisteredOfficeoftheCompanylocatedatABSTowers,OldPadraRoad,Vadodara–390007aswellasCorporateOfficeoftheCompanysituatedat5th Floor, Viraj Towers, Next to Andheri Flyover, Western Express Highway, Andheri (East), Mumbai – 400093 from 9.00 AM to 6.00 PM on all working days (excluding Saturdays, Sundays and Holidays) till the date of the Annual General Meeting.

None of the Directors and/or Key Managerial Personnel of the Company and/or their relatives are in any way concerned in the aforesaid Special Resolution, except to the extent of their entitlements, if any, under the Scheme.

The Directors recommend the Resolution as stated at Item No. 5 of the Notice for approval of the Members by way of a Special Resolution. By order of the Board of Directors

For INOX Leisure Limited

Dhanraj MulkiPlace: Mumbai Vice President – Legal Date: 8th August, 2016 & Company Secretary

Registered Office:ABS Towers, Old Padra Road, Vadodara – 390 007

Notice

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Annual Report 1516

Route Map

Route Map the Venue of the Annual General Meeting

Hotel Express Residency

Realty G

RC Dutt Road

Indubhai Patel Marg

Shagun

Vadodara Railway Station

Board’s Report

To the Members ofINOX LEISURE LIMITED

Your Directors take pleasure in presenting to you their Seventeenth Annual Report together with the Audited Financial Statements for the Financial Year ended 31st March, 2016.

1. FINANCIAL RESULTS

(` in Lakh)

Particulars Consolidated Standalone2015-16 2014-15 2015-16* 2014-15

IncomeNet Sales / Income from Operations 1,28,530.65 97,212.44 1,28,530.64 90,936.51Other operating Income 4737.94 4,468.85 4737.94 4,432.08 Total Income from Operations 1,33,268.59 1,01,681.29 1,33,268.58 95,368.59 Less: Total Expenses 1,22,306.23 96,987.79 1,22,298.78 90,444.11Profit from operations before Other Income and Finance Cost and Exceptional Items

10,962.36 4693.50 10,969.80 4924.48

Add: Other Income 432.46 826.51 432.44 1,104.55Profit from operations after Other Income and before Finance Cost and Exceptional Items

11,394.82 5,520.01 11,402.24 6,029.03

Less: Finance Cost 2,441.76 3,861.00 2,433.74 3,842.99Profit from ordinary activities after Finance Cost but before Exceptional Items

8,953.06 1,659.01 8,968.50 2,186.04

Add/(Less): Exceptional Items (496.02) (60.00) (496.02) (50.52)Profit from ordinary activity before Taxation 8,457.04 1,599.01 8,472.48 2,135.52Add/(Less): Provision for Taxation• For the Year• Earlier Years

(3,096.37)2,388.33

(506.39)911.19

(3,096.37)2,388.33

(511.57)852.51

Net Profit for the Year 7749.00 2,003.81 7,764.44 2,476.46ProfitbroughtforwardformearlierYear/s 14,493.94 13002.69 14,965.92 13002.00Less:Adjustmentonaccountofcarryingamountoffixedassets as at 1st April, 2014

(512.56) - (512.56)

Less: Adjustment on account of amalgamation (391.54) - (844.60) -Balance Carried forward to Balance Sheet 21,851.40 14,493.94 21,885.76 14,965.90

*IncludesfiguresofSatyamCineplexesLimitedonamalgamation(seepara5below.)

During the year under review, 12 Multiplex Cinema Theatres with 51 screens were added and an agreement for 1 (One) Multiplex Cinema Theatres with 3 Screens was discontinued.

Further, on merger of Satyam Cineplexes Limited with the Company (see para 5 below), 10 Multiplex Cinema Theatre with 41 screens and 9,789 seats were vested in the Company. Accordingly, the tally of Multiplex Cinema Theatres of your Company stands at 107 Multiplexes with 420 screens and 108,931 seats as on 31st March, 2016.

Detailed analysis of the Financial Performance of the Company has been given in the Management Discussion and Analysis annexed to this Report.

2. CONSOLIDATED FINANCIAL STATEMENTS

The Audited Consolidated Financial Statements prepared in accordance with the requirements of the Companies Act, 2013, SEBI (Disclosure and Listing Obligations Requirements) Regulations, 2015 (Listing Regulations) and Accounting Standard (AS) - 21 on Consolidated Financial Statements read with AS - 23 on Accounting for Investments in Associates and AS - 27 on Financial Reporting of Interests in Joint Ventures for the Financial Year 2015-16 forms part of this Annual Report. The Audited Standalone and Consolidated Financial Statements for the Financial Year 2015-16 shall be laid before the Annual General Meeting for approval of the Members of the Company.

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Annual Report 1516

3. DIVIDEND

Withaviewtofinance theCompany’songoingprojectsandconsidering futureexpansionplans,noDividendhasbeenrecommended by the Board of Directors for the year ended 31st March, 2016.

4. DIRECTORS

Mr. Siddharth Jain (DIN: 00030202) retires by rotation and being eligible, offers himself for re-appointment.

Necessary resolution in respect of Director seeking re-appointment and his brief Resume pursuant to Regulation 36(3) of the Listing Regulations are provided in the Notice of the Annual General Meeting forming part of this Annual Report.

5. MERGER OF SATYAM CINEPLEXES LIMITED, WHOLLY-OWNED SUBSIDIARY, WITH THE COMPANY

The Scheme of Amalgamation of Satyam Cineplexes Limited (“Satyam” or “Transferor Company”) with the Company (“Scheme”) under the provisions of Sections 391 to 394 of the Companies Act, 1956 and other applicable provisions of the Companies Act, 1956, has been sanctioned by the Hon’ble High Court of Delhi (“Court”) on 10th February 2016. Consequent upon filing of theOrder of theHon’bleHighCourt ofDelhiwith theRegistrar ofCompanies,Delhi andAhmedabad, the Scheme has become effective from 23rd March 2016. Accordingly, the merger of Satyam with the Company in terms of the Scheme has become operative from the appointed date, being 8th August 2014 and the Transferor Company now stands dissolved.

Satyam, being a wholly owned subsidiary of the Company, the entire paid-up capital of Satyam was held by the Company. Pursuant to the Scheme, no shares have been issued by the Company on amalgamation and shares held by the Company in Satyam have been cancelled and extinguished.

Pursuant to the accounting treatment as specified in the Scheme, (see note 30 of Notes to the standalone financialstatements), the amount of share capital of Satyam and investment held by the Company is adjusted against each other and the Goodwill of ` 16479.13 Lakh, being excess of Company’s investment in Satyam over the net asset taken over, has been adjusted against the Amalgamation Reserve, Reserves on Sale of Treasury Shares and General Reserves as per the Scheme.

6. NOMINATION & REMUNERATION POLICY

The Board of Directors of the Company has, on recommendation of the Compensation, Nomination & Remuneration Committee, framed and adopted policy for selection and appointment of Directors, Key Managerial Personnel and their remuneration. The Nomination & Remuneration Policy of the Company is annexed to this Report as Annexure A.

7. INDEPENDENT DIRECTORS

Pursuant to provision of Section 149(7) of the Act, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations.

8. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

Details of Familiarization Programmes imparted to Independent Directors have been disclosed on the Website of the Company. The same can be viewed at https://www.inoxmovies.com/Corporate.aspx?Section=3.

9. BOARD EVALUATION

All Independent Directors, at their Meeting held on 4th February, 2016, had evaluated performance of Non-Independent Directors, Chairman of the Company and Board as a whole including Committees of Board, in accordance with evaluation mechanism for performance approved at the said Meeting. Further, the Board of Directors at its Meeting held on 4th February, 2016 have evaluated performance of Independent Directors in accordance with the evaluation mechanism for performance approved at the said Meeting. These evaluations were done as per the requirements laid down in Section 149 of the Act read with Schedule IV to the said Act and Regulations 17 (10) and 25 (3) of the Listing Regulations. The performanceofDirectorswasevaluatedbasedontheparameterssuchasQualifications,Experience,Personalattributeslike honesty and integrity, independence, professional skills, contribution to Board Meetings, etc. while the performance of the Board and the Committees of the Board was evaluated based on the parameters such as policies and procedures followed, qualification and experience of Board andCommitteeMembers, composition of Board and theCommittee,

Board’s Report

diversity on the Board, Board Meetings and Committee Meetings, Corporate Governance, etc. A structured questionnaire coveringtheaboveareasofcompetencieswasgiventoeachDirector.FeedbackreceivedfromtheDirectorsreflectedhighly satisfactory performance.

10. MEETINGS OF THE BOARD

During the year, the Board met seven (7) times and details of Board Meetings held are given in the Corporate Governance Report. The intervening gap between the two Meetings was within the time limit prescribed under Section 173 of the Act read with Regulation 17 (2) of the Listing Regulations.

11. DIRECTOR’S RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134 of the Act:

i. in the preparation of the Annual Accounts, the applicable Accounting Standards had been followed and there are no departures from the requirements of the Accounting Standards;

ii. the Directors had selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of theFinancialYearandoftheProfitoftheCompanyforthatperiod;

iii. theDirectorshadtakenproperandsufficientcareforthemaintenanceofadequateaccountingrecordsinaccordancewith the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. the Directors had prepared the Annual Accounts on a going concern basis;

v. the Directors had laid down Internal Financial Controls to be followed by the Company and that such Internal Financial Controls are adequate and were operating effectively; and

vi. the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

12. CHANGE IN KEY MANAGERIAL PERSONNEL OF THE COMPANY

Mr. Miket Shashikant Bahuva, Company Secretary & General Manager – Legal has resigned with effect from 7th August 2015 and Mr. Dhanraj Mulki was appointed as a Company Secretary and designated as a Key Managerial Person of the Company with effect from 29th August 2015.

13. PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED

Particulars of Loans given, Investments made, Guarantees given and Securities provided along with the purpose for which the Loan or Guarantee or Security is proposed to be utilized by the Recipient are provided in the Standalone Financial Statements of the Company. Please refer to Notes no. 15, 16, and 50 to the Standalone Financial Statements of the Company.

14. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All Contracts / Arrangements / Transactions entered by the Company during the year under review with Related Parties are approved by the Audit Committee and/or Board, as per the provisions of Section 188 of the Act read with Rule 15 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 23 of the Listing Regulations. During the year under review, the Company had not entered into any Contract / Arrangement / Transaction with Related Parties which could be considered material in accordance with the Policy of the Company on Materiality of Related Party Transactions.

The Policy on Materiality of Related Party Transactions and dealing with Related Party Transactions as approved by the Board may be accessed on the Company’s Website at the link https://www.inoxmovies.com/Corporate.aspx?Section=3.

All transactions entered with Related Parties for the year under review were on arm’s length basis. Further, there are no material related party transactions during the year under review with any Related Party. Hence, disclosure in Form AOC-2 is not required to be annexed to this Report.

Board’s Report

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Annual Report 1516

15. DEPOSITS

The Company has not accepted any deposits covered under Chapter V of the Act.

16. SUBSIDIARY COMPANY INCLUDING JOINT VENTURE

The Company has following Subsidiary / Joint Ventures.

A. SHOURI PROPERTIES PRIVATE LIMITED The Company is holding 99.29% Equity Shares of Shouri Properties Private Limited (SPPL). SPPL is engaged in the

business of operating a multiplex cinema theatre.

B. SWANSTON MULTIPLEX CINEMAS PRIVATE LIMITED Swanston Multiplex Cinemas Private Limited (SMCPL) is a Joint-venture of the Company with Reliance Mediaworks

Limited (RML) where the Company and RML are holding 50% Equity Shares each of SMCPL.

During the year under review, Satyam Cineplexes Limited, wholly-owned subsidiary of the Company has ceased to be a subsidiary on account of its merger with the Company as stated in Para 5 above.

TheReportonthehighlightsofperformanceandfinancialpositionofeachoftheSubsidiaryandJointVentureCompanyof

theCompanyinFormno.AOC-1pursuanttofirstprovisotosub-section(3)ofSection129oftheCompaniesAct,2013and Rule 5 of Companies (Accounts) Rules, 2014 along with the contribution of the Subsidiary and Joint Venture Company to overall performance of the Company during the year in terms of Rule 8 of Companies (Accounts) Rules, 2014 is annexed to this Report as Annexure B.

The Audited Financial Statements of the Subsidiary Company are available on the Website of the Company and a copy will be provided to the Shareholders on request as per the provisions of Section 136 of the Act.

17. INTERNAL FINANCIAL CONTROLS

The Company has adequate internal controls commensurate with its size and nature of its business. The Board has reviewed internal financial controlsof theCompanyand theAuditCommitteemonitors the same inconsultationwithInternal Auditors of the Company.

18. INDEPENDENT AUDITORS’ REPORT

There arenoreservations,qualificationsoradverseremarksintheIndependentAuditor’sReport.Thenotesformingpartoftheaccountsareself-explanatoryanddonotcallforanyfurtherclarificationsunderSection134(3)(f)oftheAct.Inrespectof observation made in the Independent Auditors’ Report at Point 10 of Annexure to Independent Auditor’s Report, the Note 41 of the Notes to the Standalone Financial Statements for the year ended 31st March, 2016 is self-explanatory.

19. INDEPENDENT AUDITORS

Members are requested to ratify appointment of M/s. Patankar & Associates, Chartered Accountants (Firm Registration No.: 107628W) as Independent Auditors of the Company from the conclusion of the 17th Annual General Meeting until theconclusionof18thAnnualGeneralMeetingandtofix,orauthorisetheBoardtofix,theirremunerationbasedontherecommendation of the Audit Committee. M/s. Patankar & Associates, Chartered Accountants (Firm Registration No.: 107628W)haveconfirmedthattheirappointment,ifratified,willbeinaccordancewithSection139oftheActreadwithRule 4 of the Companies (Audit and Auditors) Rules, 2014 and they satisfy criteria laid down in Section 141 of the Act.

20. COST AUDITORS

In terms of Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, the Company is not required to include Cost Accounting Records in its books of accounts in respect of generation of electricity by Wind Mills oftheCompanysincetheWindMillsoftheCompanysatisfythecriteriaofCaptiveGeneratingPlantasdefinedinRule3ofThe Electricity Rules, 2005. Accordingly, the Company is not required to appoint Cost Auditor for Financial Year 2015 – 16.

21. SECRETARIAL AUDIT REPORT

In terms of Section 204 of the Act read with Rule 9 of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, theCompany has appointedM/s. Samdani Shah andAssociates, a firmof PractisingCompany

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Secretaries to conduct Secretarial Audit of the Company. The Secretarial Audit Report given by M/s. Samdani Shah and Associates in Form No. MR-3 is annexed to this Report at Annexure - C.

ThereisnoqualificationintheSecretarialReportsubmittedbyM/s.SamdaniShahandAssociatestotheCompany.

22. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34(2) of the Listing Regulations is presented in a separate Section forming part of this Annual Report.

23. CORPORATE GOVERNANCE

PursuanttoRegulation34(3)oftheListingRegulations,CorporateGovernanceReportandAuditors’Certificateregardingcompliance of conditions of Corporate Governance is annexed with this report.

IncompliancewiththerequirementsofRegulation17(8)oftheListingRegulations,aCertificatefromtheChiefExecutiveOfficerandChiefFinancialOfficeroftheCompanywasplacedbeforetheBoard.

All theBoardMembersandSeniorManagementPersonneloftheCompanyhadaffirmedcompliancewiththeCodeofConduct for Board and Senior Management Personnel. A declaration to this effect duly signed by the Chief Executive OfficerisenclosedasapartoftheCorporateGovernanceReport.

24. EXTRACT OF ANNUAL RETURN

In terms of Section 92 (3) of the Act read with Rule 12 of the Companies (Management & Administration) Rules, 2014, the extract of Annual Return as provided in Form No. MGT -9 is annexed to this Report at Annexure – D.

25. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in respect of Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo pursuant to Section 134 of the Act, read with Rule 8 of the Companies (Accounts) Rules, 2014, in the manner prescribed is annexed to this Report at Annexure – E.

26. EMPLOYEE STOCK OPTION SCHEME

During the year under review, no options were granted to Employees of the Company and no shares were allotted to the employees of the Company. There are no changes in the Scheme and the Scheme is in compliance with the SEBI (Share BasedEmployeeBenefit)Regulations,2014.

ThedisclosuresasrequiredundertheSEBI(ShareBasedEmployeeBenefit)Regulations,2014hasbeendisclosedonthewebsite of the Company and the same can be viewed at https://www.inoxmovies.com/Corporate.aspx?Section=3.

27. PARTICULARS OF EMPLOYEES

Disclosure pertaining to remuneration and other details as required under Section 197 (12) read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed to this Report at Annexure - F.

In accordance with the provisions of Section 197 (12) of the Act, read with Rules 5 (2) and 5 (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, a statement showing the name and other particulars of the employees drawing remuneration in excess of the limits set out in the aforesaid rule forms part of this Report. However, in terms of Section 136 of the Companies Act, 2013, the Report and Accounts are being sent to the Members of the Company excluding information on employees’ particulars which is available for inspection by the Members attheRegisteredOfficeoftheCompanyduringthebusinesshoursonworkingdaysoftheCompanyuptothedateoftheensuing Annual General Meeting. If any Member is interested in obtaining such information may write to the Company SecretaryattheRegisteredOfficeoftheCompany.

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Annual Report 1516

28. CORPORATE SOCIAL RESPONSIBILITY

Pursuant to the provisions of Section 135 of the Act read with relevant Rules made thereunder, the Board of Directors at its Meeting held on 27th May, 2014, has constituted a Corporate Social Responsibility Committee.

The report on CSR activities as per Companies (Corporate Social Responsibility) Rules, 2014 is annexed to this Report at Annexure - G.

29. INSURANCE

The Company’s property and assets have been adequately insured.

30. INFORMATION UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place a Policy on Prevention, Prohibition and Redressal of sexual harassment at the workplace in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Company has formed Internal Complaints Committee to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this Policy.

The following is the summary of sexual harassment complaints received and disposed off during the year 2015-16.

Number of complaints received 10Number of complaints disposed off 10

31. RISK MANAGEMENT The Company has in place a mechanism to inform the Board about the risk assessment and minimization procedures to

review key elements of risks viz. Regulatory and Legal, Competition and Financial involved and measures taken to ensure thatriskiscontrolledbymeansofaproperlydefinedframework.IntheBoard’sview,therearenomaterialrisks,whichmaythreaten the existence of the Company. For further details, please refer to the Management Discussion and Analysis Report forming part of this Annual Report.

32. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THIS REPORT

Therearenomaterial changesandcommitments affecting thefinancialpositionof theCompanywhichhaveoccurredbetween the end of the Financial Year of the Company to which the Financial Statements relate and the date of this Report.

33. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS IN FUTURE

There are no orders passed by the Regulators or Courts or Tribunals impacting the going concern status and Company’s operations in future.

34. ACKNOWLEDGEMENT

Your Directors express their gratitude to all other external agencies for the assistance, co-operation and guidance received. Your Directors place on record their deep sense of appreciation for the dedicated services rendered by the workforce of the Company.

By Order of the Board of Directors

Date: Mumbai Pavan Jain Place: 8th August, 2016 Chairman (DIN: 00030098)

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ANNEXURE – A

Nomination and Remuneration Policy:

1. Preface: a. The present Human Resource Policy of the Company considers human resources as its invaluable assets and has its

objective the payment of remuneration to all its employees appropriate to employees’ role and responsibilities and the Company’s goals based on the performance of each of its employees in the Company.

b. This Nomination and Remuneration Policy (NR Policy) has been formulated, inter alia, for nomination and remuneration of Directors, Key Managerial Personnel (KMP), Senior Management Personnel and other Employees of INOX Leisure Limited (hereinafter referred to as the Company), in accordance with the requirements of the provisions of Section 178 of the Companies Act, 2013 and Listing Agreement.

2. Objectives of this Nomination and Remuneration Policy: a. To laydowncriteria for identifyingpersonswhoarequalifiedtobecomeDirectorsandwhomaybeappointed in

Senior Management of the Company in accordance with the criteria laid down by CNR Committee and recommend to the Board their appointment and removal.

b. To lay down criteria to carry out evaluation of every Director’s performance.

c. Toformulatecriteriafordeterminingqualification,positiveattributesandIndependenceofaDirector;

d. To determine the composition and level of remuneration, including reward linked with the performance, which is reasonable and sufficient to attract, retain andmotivateDirectors, KMP, SeniorManagement Personnel & otheremployees to work towards the long term growth and success of the Company.

3. Definitions: a. “Board” means the Board of Directors of the Company.

b. “Directors” means the Directors of the Company.

c. “CNR Committee” means the Compensation, Nomination and Remuneration Committee of the Company as constituted or reconstituted by the Board from time to time.

d. “Company” means INOX Leisure Limited.

e. “Key Managerial Personnel”(KMP) means

• ManagingDirector;orChiefExecutiveOfficer;orManagerandintheirabsence,aWhole-timeDirector;

• Company Secretary;

• ChiefFinancialOfficer

f. “Senior Management Personnel” means, the personnel of the Company who are members of its core management team excluding Board of Directors and KMPs, comprising of all members of management on level below the Executive Directors including the functional heads.

g. “Other employees” means, all the employees other than the Directors, KMPs and the Senior Management Personnel.

4. Nomination and Remuneration Policy Nomination and Remuneration Policy is divided into three parts as follows:

I. Qualifications Criteria for identifying persons who are qualified to be appointed as a Directors / KMP /Senior Management

Personnel of the Company:

a. Directors Section164oftheCompaniesAct,2013statesdisqualificationsforappointmentofanypersontobecomeDirector

ofanyCompany.AnypersonwhointheopinionoftheBoardisnotdisqualifiedtobecomeaDirector,andinthe

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53

Annual Report 1516

opinion of the Board, possesses the ability, integrity and relevant expertise and experience, can be appointed as Director of the Company.

b. Independent Directors ForappointinganypersonasanIndependentDirectorhe/sheshouldpossessqualificationsasmentionedinRule5

ofTheCompanies(AppointmentandQualificationofDirectors)Rules,2014.

c. Senior Management Personnel and KMP and Other Employees The Company has an Organogram displaying positions of Senior Management including KMP and other positions

withtheminimumqualificationsandexperiencerequirementsforeachpositionswhichcommensuratewiththesize of its business and the nature and complexity of its operations. Any new recruit in the Company is to match the requirements prescribed in the Organogram of the Company.

II. Remuneration a. Structure of Remuneration for the Managing Director, Key Managerial Personnel and Senior

Management Personnel The Managing Director, Key Managerial Personnel and Senior Management Personnel (other than Non-executive

Directors) receive Basic Salary and other Perquisites. The Perquisites include other allowances. The total salary includesfixedandvariablecomponents.

TheCompany’spolicy is that thetotalfixedsalaryshouldbe fairandreasonableafter taking intoaccount thefollowing factors:

• The scope of duties, the role and nature of responsibilities • The level of skill, knowledge and experience of individual • Core performance requirements and expectations of individuals • The Company’s performance and strategy • Legal and industrial Obligations

The table below depicts the standard components of remuneration package

Fixed ComponentBasic Salary Allowances Superannuation

b. Structure of Remuneration for Non-executive Director Non-executive Directors are remunerated to recognize responsibilities, accountability and associated risks of

Directors. The total remuneration of Non-executive Directors may include all, or any combination of following elements:

i. Fees for attending meeting of the Board of Directors as permissible under Section 197 of the Companies Act, 2013 read with Rule 4 of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 and decided at the Meeting of the Board of Directors.

ii. Fees for attending meetings of Committees of the Board which remunerate Directors for additional work on Board Committee as permissible under Section 197 of the Companies Act, 2013 read with Rule 4 of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 and decided at the Meeting of the Board of Directors.

iii. CommissiononnetprofitsaspermissibleunderSection197oftheCompaniesAct,2013anddecidedbytheBoard from time to time to be payable to any of the Non-executive Director.

iv. Non-Executive Directors are entitled to be paid all traveling and other expenses they incur for attending to the Company’s affairs, including attending and returning from General Meetings of the Company or Meetings of the Board of Directors or Committee of Directors.

v. Remuneration by way of professional fees to the non-executive Directors who, in the opinion of the CNR Committee,possessestherequisitequalificationsforthepracticeoftheprofession,forprovidingprofessionalservices to the Company.

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Any increase in the maximum aggregate remuneration payable beyond permissible limit under the Companies Act, 2013 shall be subject to the approval of the Shareholders’ at the Annual General Meeting by special resolution and/or of the Central Government, as may be applicable.

c. Structure of Remuneration for Other Employees The power to decide structure of remuneration for other employees has been delegated to HR Department of

the Company.

III. Evaluation a. Criteria for evaluating Non-executive Board members: Section 149 of the Companies Act, 2013 read with Schedule IV of the said Act states that the Independent

Directors shall at its separate meeting review performance of Non-independent Directors and the Board as a whole and the performance evaluation of Independent Directors shall be done by the entire Board of Directors excluding the Director being evaluated.

b. Criteria for evaluating performance of Key Managerial Personnel and Senior Management Personnel Criteria for evaluating performance of KMP and Senior Management Personnel shall be as per the HR Guideline

on Performance Management System and Development Plan of the Company.

C. Criteria for evaluating performance of Other Employees The power to decide criteria for evaluating performance of Other Employees has been delegated to HR

Department of the Company.

5. Communication of this Policy For all Directors, a copy of this Policy shall be handed over within one month from the date of approval by the Board.

This Policy shall also be posted on the web-site of the Company and in the Annual Report of the Company.

6. Amendment Any change in the Policy shall, on recommendation of CNR Committee, be approved by the Board of Directors of the

Company. The Board of Directors shall have the right to withdraw and / or amend any part of this Policy or the entire Policy,atanytime,asitdeemsfit,orfromtimetotime,andthedecisionoftheBoardinthisrespectshallbefinalandbinding.

The Nomination and Remuneration Policy is placed on the website of the Company and web link is https://www.inoxmovies.com/Corporate.aspx?Section=3.

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55

Annual Report 1516

ANNEXURE – B

Statement containing salient features of the financial statement of subsidiaries / associate companies/ joint ventures

Part A – Subsidiaries

(` in Lakh)

Particulars Name of Subsidiary Company

Shouri Properties Private Limited

The date of acquisition of subsidiary 24th November, 2014

Reporting period, if different from the holding Company Not Applicable

Reporting currency and exchange rate as on the last date of the relevant Financial Year in case of foreign subsidiaries

Not Applicable

Share Capital 141.00

Reserves and Surplus (71.44)

Total Assets 200.39

Total Liabilities 130.83

Investments Nil

Turnover 354.69

Profit/(Loss)beforetaxation (14.51)

Provision for taxation Nil

Profit/(Loss)aftertaxation (14.51)

Proposed Dividend Nil

% of Shareholding 99.29%

Name of subsidiaries which are yet to commence operations: Nil

Names of subsidiaries which have been liquidated or sold during the year:

Satyam Cineplexes Limited has been merged with INOX Leisure Limited. Refer Para 5 of the Boards’ Report for further details.

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Part B – Associates and Joint Ventures

Statement related to Associate Companies and Joint Ventures

Sr. No.

Particulars Swanston Multiplex Cinemas Private Limited (SMCPL)

1 Latest Audited Balance Sheet date 31/03/20162 Date on which the Associate or Joint Venture was associated or acquired 1st April, 20123 Shares of Associates/Joint Ventures held by the Company on the year end

Number 10,15,000Amount of investment in Associates/ Joint Venture ` 279.52 LakhExtent of holding % 50.00%

4 Descriptionofhowthereissignificantinfluence Company holds 50% Equity Shares in SMCPL

5 Reason why the associate/joint venture is not consolidated Not Applicable6 Net worth attributable to Shareholding as per latest balance sheet ` (5.83) Lakh

Profit/Loss for the yearConsidered in consolidation ` (1.00) LakhNot considered in consolidation Nil Not considered in consolidation Nil Name of associates or joint ventures which are yet to commence operations NilNames of associates or joint ventures which have been liquidated or sold during the year

Nil

For Patankar & Associates For INOX Leisure LimitedChartered Accountants

Sanjay Agrawal Siddharth Jain Deepak Asher Alok Tandon Upen ShahPartner Director Director ChiefExecutiveOfficer ChiefFinanceOfficer

Dhanraj Mulki Vice President - Legal & Company Secretary

Place: Pune Place: Mumbai Date: 8th August, 2016 Date: 8th August, 2016

Contribution of each of the subsidiary to the overall performance of the Company.

Name of Subsidiary Company/ Joint Venture Company Particulars Subsidiary Company Joint Venture Company

Shouri Properties Private Limited Swanston Multiplex Cinemas Private Limited (SMCPL)

Total Revenues contribution (%) Nil NilEBIDTA contribution (%) (0.03%) (0.01%)NetProfitcontribution(%) (0.19%) (0.01%)Gross Block contribution (%) Nil NilNet Worth contribution (%) (0.05%) (0.01%)

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Annual Report 1516

ANNEXURE – C

Form MR-3Secretarial Audit Report

for the Financial Year ended 31st March, 2016[Pursuant to section 204(1) of the Companies Act, 2013 and rule 9

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

To,The Members,INOX Leisure Limited5th Floor, Viraj Towers,Andheri (East),Mumbai - 400093.

We have conducted the Secretarial Audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by INOX Leisure Limited (hereinafter referred to as ‘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. BasedonourverificationoftheCompany’sBooks,Papers,MinuteBooks,FormsandReturnsfiledandotherrecordsmaintainedbythecompanyandalsotheinformationprovidedbythecompany,itsofficers,agentsandauthorizedrepresentativesduringthe 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, 2016, 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:

WehaveexaminedtheBooks,Papers,MinuteBooks,FormsandReturnsfiledandotherrecordsmaintainedbytheCompanyfor the Financial Year ended on March 31, 2016, according to the provisions of:

i. The Companies Act, 2013 (the Act) and the rules made there under;

ii. The Securities Contracts (Regulation) Act, 1956 (SCRA) and the rules made thereunder;

iii. The Depositories Act, 1996 and the Regulations and Bye-laws framed there under;

iv. Foreign Exchange Management Act, 1999 and the rules and regulations made there under to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings;

v. The following Regulations and Guidelines prescribed under the securities and Exchange Board of India Act, 1992 (SEBI Act):-

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992/2015;

(c) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulation, 1993 regarding the Companies Act and dealing with client.

(d) TheSecuritiesandExchangeBoardofIndia(ShareBasedEmployeeBenefits)Regulations,2014;

We further report that, there were no actions/events in pursuance of the following regulations requiring compliance thereof by the company during the period of this report:-

(a) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;

(b) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009;

(c) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998;

(d) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009;

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vi. Othersectorspecificlawsasfollows:-

(a) The Cinematograph Act, 1952;

(b) The Cinema Regulations Act as applicable in each state along with the necessary Rules;

(c) Entertainment Tax Laws as applicable in each state along with the necessary Rules.

We have also examined compliance with the applicable clauses/regulations of the following:

(i) Secretarial Standards issued by The Institute of Company Secretaries of India;

(ii) The Listing Agreement entered into by the Company with BSE Limited and National Stock Exchange of India Limited and/or Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015;

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 executive directors, non-executive directors and independent directors. The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act.

Adequate notice is given to all the Directors to schedule the Board Meetings, Agenda and detailed notes on Agenda were sent atleastsevendaysinadvanceandasystemexistsforseekingandobtainingfurtherinformationandclarificationontheAgendaitems before the meeting and for meaningful participation at the meeting.

As per the minutes of the meetings duly recorded and signed by the Chairman, the decisions of the Board were unanimous and no dissenting views have been recorded.

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 all the applicable laws, rules, regulations and guidelines.

We further report thatduringtheauditperiodtherewerenospecificinstancesinpursuanceoftheabovereferredlaws,rules,regulations, guidelines, etc., having a major bearing on the Company’s affairs except amalgamation of Satyam Cineplexes Limited (a wholly owned subsidiary) with the Company.

S. SamdaniPartnerSamdani Shah & Asso.Company SecretariesFCS No. 3677, CP No. 2863

Vadodara, 18th April, 2016

This Report is to be read with our letter of even date which is annexed as Appendix A and forms an integral part of this report.

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Annual Report 1516

APPENDIX A

To,The Members,INOX Leisure Limited5th Floor, Viraj Towers,Andheri (East),Mumbai - 400093. Our report of even date is to be read along with this letter.

1. Maintenance of Secretarial records and compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the responsibility of the management of the company. Our examination was limited to the verificationandauditofproceduresandrecordsontestbasis.Ourresponsibilityistoexpressanopiniononthesesecretarialrecordsandcompliancesbasedonsuchverificationandaudit.

2. We have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctnessofthecontentsofsecretarialrecords.Theverificationwasdoneontestbasistoensurethatcorrectfactsarereflectedinsecretarialrecords.Webelievethattheprocessesandpracticeswefollowedprovideareasonablebasisforouropinion.

3. Wherever required, we have obtained the management representation about the compliance of laws, rules and regulations and happening of events etc.

4. TheSecretarialAuditreportisneitheranassuranceastothefutureviabilityofthecompanynortheefficacyoreffectivenesswith which the management has conducted the affairs of the company.

S. SamdaniPartnerSamdani Shah & Asso.Company SecretariesFCS No. 3677, CP No. 2863

Vadodara, 18th April, 2016

Board’s Report

ANNEXURE – D

MGT – 9Extract of Annual Return as on the Financial Year ended on 31st March, 2016

(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

i. CorporateIdentificationNumber : L92199GJ1999PLC044045ii. Registration Date : 9th November, 1999iii. Name of the Company : INOX Leisure Limited iv. Category/Sub-Category of the Company : Public Limited Company /Company Ltd. by Sharesv. AddressoftheRegisteredOfficeand

Contact Details: ABS Towers, Old Padra Road, Vadodara – 390 007, Gujarat

Phone No.: 0265 6198 111Fax No.: 0265 2310312

vi. Whether listed Company : Yesvii. Name, Address and Contact Details of

Registrar and Share Transfer Agents, if any: Karvy Computershare Private Limited

Karvy Selenium Tower No. B, Plot No. 31 - 32, Gachibowli, Financial District Nanakramguda Hyderabad – 500 032Phone No.: 040 6716 2222Fax No.: 040 2300 1153

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANYAll the business activities contributing 10% or more the total turnover of the company shall be stated:

Sr. No

Name and Description of main products/services

NIC Code of the Product / Service

% to total turnover of the company

1 Operating Multiplex Cinema Theatres 59141 100.00%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

Sr. No.

Name CIN/GIN Holding/subsidiary/associate

% of shares held

Applicable Section

1 Gujarat Fluorochemicals LimitedSurvey No. 16/3, 26 & 27, Ranjitnagar – 389 380, Taluka Ghoghamba, District Panchmahal, Gujarat

L24110GJ1987PLC009362 Holding 48.09 2 (46)

2 Shouri Properties Private LimitedUnit No. F1, 1st Floor, Shanti Nagar Co-operative Industrial Estate Limited, Vakola, Santacruz (East), Mumbai- 400055

U45201MH2002PTC134393 Subsidiary 99.29 2 (87)

3 Swanston Multiplex Cinemas Private LimitedViraj Towers, 9th Floor, Next to Andheri Flyover, Western Express Highway, Andheri (East), Mumbai – 400093

U92132MH2001PTC133639 Joint Venture Company

50.00 2 (6)

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61

Annual Report 1516

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Board’s Report

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Board’s Report

63

Annual Report 1516

(ii) Shareholding of Promoters:

Sr. No.

Shareholder’s Name

Shareholding at the beginning of the year (1st April, 2015)

Shareholding at the end of the year (31st March, 2016)

No. 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

% change in shareholding

during the year

1. Gujarat Fluorochemicals Limited

46386467 48.09 0 46386467 48.09 0 0.00

2. INOX Leasing and Finance Limited

587461 0.61 0 587461 0.61 0 0.00

Total 46973928 48.70 0 46973928 48.70 0 0.00(iii) Change in Promoters’ Shareholding (please specify, if there is no change): There is no change in the Promoters’ Shareholding during Financial Year 2015-16.

(iv) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):

Sr. No.

For Each of the Top 10 Shareholders

Shareholding at the beginning of the year

(1st April, 2015)/ End of the Year (31st March, 2016)

Date Increase/(Decrease)

in shareholding

Reason Cumulative Shareholding during

the year

No. of shares

% of total shares of the

Company

No. of shares


Company1. Kuwait Investment

Authority - Fund No. 208 4563357 4.73 01/04/2015

10/04/2015 (611840) Sale 3951517 4.103951517 4.10 31/03/2016

2. Pavan Kumar Jain, Vivek Kumar Jain & Deepak Asher -Trustee of INOXBenefitTrust

4350092 4.51% 01/04/2015 No Movement during the year.

4350092 4.51% 31/03/20163. Goldman Sachs India

Fund Limited4061915 4.21 01/04/2015

05/06/2015 179635 Purchase 4241550 4.40

26/06/2015 74130 Purchase 4315680 4.47

30/06/2015 30000 Purchase 4345680 4.51

31/07/2015 228732 Purchase 4574412 4.74

4574412 4.74 31/03/2016

4. ICICI Prudential Growth Fund-Series 1

3216623 3.33 01/04/2015

01/05/2015 3477 Purchase 3220100 3.3408/05/2015 96523 Purchase 3316623 3.4415/05/2015 (591992) Sale 2724631 2.8231/07/2015 (12094) Sale 2712537 2.81

04/09/2015 (20284) Sale 2692253 2.7911/09/2015 (48602) Sale 2643651 2.74

Board’s Report

Sr. No.





in shareholding


the year

No. of shares


Company

No. of shares


Company18/09/2015 (168611) Sale 2475040 2.5725/09/2015 (53161) Sale 2421879 2.5130/09/2015 (212144) Sale 2209735 2.2902/10/2015 (46276) Sale 2163459 2.2409/10/2015 (229474) Sale 1933985 2.0123/10/2015 (35199) Sale 1898786 1.9711/03/2016 (2170) Sale 1896616 1.97

1896616 1.97 31/03/20165. Macquarie Fund

Solutions A/c Macquarie Fund Solutions - Macquarie Asia New Stars Fund

2968417 3.08 01/04/2015

19/06/2015 (200000) Sale 2768417 2.872768417 2.87 31/03/2016

6. Government Pension Fund Global

2400000 2.49 01/04/2015 No Movement during the year.

2400000 2.49 31/03/20167. TATA trustee co. Ltd

A/C TATA Mutual Fund 2028500 2.10 01/04/2015

01/05/2015 77000 Purchase 2105500 2.1815/05/2015 500000 Purchase 2605500 2.7009/10/2015 100000 Purchase 2705500 2.8025/12/2015 15000 Purchase 2720500 2.8231/12/2015 50000 Purchase 2770500 2.8722/01/2016 10000 Purchase 2780500 2.8804/03/2016 (75000) Sale 2705500 2.80

2705500 2.80 31/03/20168. Aadi Financial Advisors

LLP1436395 1.49 01/04/2015 No Movement during

the year.1436395 1.49 31/03/2016

9. Sundaram Mutual Fund A/c

1256185 1.30 01/04/2015

15/05/2015 66452 Purchase 1322637 1.3722/05/2015 25000 Purchase 1347637 1.4024/07/2015 166441 Purchase 1514078 1.5724/07/2015 (166441) Sale 1347637 1.4011/12/2015 (2973) Sale 1344664 1.3908/01/2016 (21039) Sale 1323625 1.3715/01/2016 (13257) Sale 1310368 1.3631/03/2016 (45124) Sale 1265244 1.31

Board’s Report

65

Annual Report 1516

Sr. No.





in shareholding


the year

No. of shares


Company

No. of shares


Company1265244 1.31 31/03/2016

10. Morgan Stanley SICAV (Mauritius) Limited

1163326 1.21 01/04/2015

10/04/2015 (249424) Sale 913902 0.9529/05/2015 76192 Purchase 990094 1.0305/06/2015 19889 Purchase 1009983 1.0514/08/2015 (7861) Sale 1002122 1.0421/08/2015 (20223) Sale 981899 1.0228/08/2015 48382 Purchase 1030281 1.0716/10/2015 158810 Purchase 1189091 1.2330/10/2015 97186 Purchase 1286277 1.3306/11/2015 49323 Purchase 1335600 1.3813/11/2015 82065 Purchase 1417665 1.4720/11/2015 15071 Purchase 1432736 1.4904/12/2015 53313 Purchase 1486049 1.5411/12/2015 82127 Purchase 1568176 1.63

1568176 1.63 31/03/201611. MACQUARIE

Unit Trust Series- Macquarie Asia New Stars Fund

1148975 1.19 01/04/2015

19/06/2015 200000 Purchase 1348975 1.40

1348975 1.40 31/03/2016

12. Kamal Shyamsunder Kabra


1000200 1.04 31/03/201613. HSBC Bank (Mauritius)

Limited896918 0.93 01/04/2015

10/04/2015 28802 Purchase 925720 0.9608/05/2015 180000 Purchase 1105720 1.1512/06/2015 200000 Purchase 1305720 1.3524/07/2015 267 Purchase 1305987 1.3528/08/2015 58930 Purchase 1364917 1.4204/09/2015 12566 Purchase 1377483 1.4323/10/2015 (1377483) Sale 0 0.00

0 0.00 31/03/201614. Reliance Capital

Trustee Co Ltd.611990 0.63 01/04/2015

10/04/2015 1068032 Purchase 1680022 1.7417/04/2015 311222 Purchase 1991244 2.06

Board’s Report

Sr. No.





in shareholding


the year

No. of shares


Company

No. of shares


Company17/04/2015 (311222) Sale 1680022 1.7415/05/2015 7210 Purchase 1687232 1.7522/05/2015 93000 Purchase 1780232 1.8512/06/2015 40000 Purchase 1820232 1.8903/07/2015 31600 Purchase 1851832 1.9217/07/2015 131721 Purchase 1983553 2.0624/07/2015 16172 Purchase 1999725 2.0730/10/2015 (40000) Sale 1959725 2.0304/12/2015 (100978) Sale 1858747 1.9322/01/2016 25000 Purchase 1883747 1.9505/02/2016 (90000) Sale 1793747 1.8619/02/2016 25000 Purchase 1818747 1.8911/03/2016 (40000) Sale 1778747 1.8418/03/2016 (10000) Sale 1768747 1.83

1768747 1.83 31/03/201615. Devansh Jain 600000 0.62 01/04/2015 No Movement during

the year.600000 0.62 31/03/2016

(v) Shareholding of Directors and Key Managerial Personnel:

Sr. No.

For Each of the Directors and KMP


(1st April, 2015)/ End of the Year

(31st March, 2016)

Date Increase/(Decrease)in shareholding

Reason Cumulative Shareholding during the year

No. of shares


company

No. of shares

% of total shares of the company

Directors1 Mr. Pavan

Kumar Jain350,000 0.36 01/04/2015 No Movement during

the year.350,000 0.36 31/03/2016

2 Mr. Vivek Kumar Jain

6,50,445 0.67 01/04/2015 No Movement during the year.

6,50,445 0.67 31/03/2016

3 Mr. Siddharth Jain

6,00,000 0.62 01/04/2015 No Movement during the year.

6,00,000 0.62 31/03/20164 Mr. Deepak

Asher25,000 0.03 01/04/2015 No Movement during

the year.25,000 0.03 31/03/2016

Board’s Report

67

Annual Report 1516

Sr. No.

For Each of the Directors and KMP


(1st April, 2015)/ End of the Year

(31st March, 2016)

Date Increase/(Decrease)in shareholding

Reason Cumulative Shareholding during the year

No. of shares


company

No. of shares

% of total shares of the company

5 Mr. Haigreve Khaitan


31/03/2016

6 Mr. Amit Jatia 0 0.00 01/04/2015 No Movement during the year.

31/03/2016

7 Mr. Kishore Biyani


31/03/2016

8 Ms. Girija Balakrishnan


31/03/2016

KMP

1 Mr. Alok Tandon, Chief Executive Officer

28,236 0.03 01/04/2015 No Movement during the year.

28,236 0.03 31/03/2016

2 Mr. Upen Shah, Chief Finance Officer


225 0.00 31/03/2016

3 Mr. Miket Shashikant Bahuva – CS and General Manager – Legal*


1 0.00 7/8/2015*

4 Mr. Dhanraj Mulki – CS and Vice President – Legal #

40 0.00 29/08/2015# No Movement during the year.

40 0.00 31/03/2016

* Mr. Miket Shashikant Bahuva has resigned as a Company Secretary with effect from 7th August, 2015.# Mr. Dhanraj Mulki has been appointed as a Company Secretary and has been designated as a Key Managerial Person with effect from

29th August, 2015.

Board’s Report

V. INDEBTEDNESSIndebtedness of the Company including interest outstanding/accrued but not due for payment

(` in Lakh)

Secured Loans excluding deposits

UnsecuredLoans

Deposits TotalIndebtedness

Indebtedness at the beginning of the Financial Yeari. Principal Amountii. Interest due but not paid iii. Interest accrued but not due

7,810.1865.70

--

16,249.00----

Nil----

24,059.1865.70

--Total (i+ii+iii) 7,875.88 16,249.00 Nil 24,124.88Change in Indebtedness during the Financial Year• Addition• Reduction

5,282.06(2,664.25)

5,804.95(5,804.95)

Nil 11,087.01(8,469.20)

Net Change 2,617.81 Nil Nil 2617.81

Indebtedness at the end of the Financial Yeari. Principal Amountii. Interest due but not paid iii. Interest accrued but not due

10,455.2038.48

---

16,249.00 --

---

Nil----

26,704.2038.48

--Total (i+ii+iii) 10,493.68 16,249.00 Nil 26,742.68

VI. Remuneration of Directors and Key Managerial Personnel A. Remuneration to Managing Director, Whole-time Directors and/or Manager

Sr. No. Particulars of Remuneration Name of MD / WTD / Manager1. Gross salary

(a) Salary as per provisions contained in section 17(1) of the Income-tax Act 1961

-

(b) Value of perquisites u/s17(2) Income-tax Act, 1961 -

(c) Profitsinlieuofsalaryundersection17(3)Income-taxAct,1961 -2. Stock Option -3. Sweat Equity -

4. Commission-as%ofprofit- Others, specify…

-

5. Others, please specify -Total (A) -Ceiling as per the Act -

Board’s Report

69

Annual Report 1516

B. Remuneration to Other Directors(` in Lakh)

Sr. No.

Particulars of Remuneration Name of Directors TotalAmount

1 Independent Directors Mr. Haigreve Khaitan

Mr. Amit Jatia

Mr. Kishore Biyani

Ms. Girija Balakrishnan

Fee for attending Board/ Committee Meetings

2.80 2.00 2.60 1.60 9.00

Commission 0 0 0 0 0

Others 0 0 0 0 0

Total (1) 2.80 2.00 2.60 1.60 9.00

2 Other Non-Executive Directors Mr. Pavan Jain Mr. Vivek Jain

Mr. Deepak Asher

Mr. Siddharth Jain

-

Fee for attending Board/ Committee Meetings

1.40 1.00 2.80 1.20 6.40

Commission 0 0 0 0 0

Others (Professional Fees) 0 0 30.00 0 30.00

Total (2) 1.40 1.00 32.80 1.20 36.40

Total of B = (1+2) 45.40

Total Managerial Remuneration (A+B) 45.40

Overall Ceiling as per the Act 267.39

c. Remuneration to Key Managerial Personnel (KMP) other than MD/ Manager/WTD(` in Lakh)

Sr. No.

Particulars ofRemuneration

Key Managerial Personnel

CEO CompanySecretary*

CFO Total

1. Gross salary(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961

88.58 24.77 53.49 166.84

(b) Value of perquisites u/s17(2) Income-tax Act, 1961

Nil Nil Nil Nil

(c)Profitsinlieuofsalaryundersection17(3) Income-taxAct, 1961

Nil Nil Nil Nil

2. Stock Option Nil Nil Nil Nil

3. Sweat Equity Nil Nil Nil Nil

4. Commission-as%ofprofit- others, specify…

Nil Nil Nil Nil

5. Others, please specify (Employer’s Contribution to Provident Fund)

5.38 1.62 2.81 9.81

Total 93.96 26.39 56.30 176.65

* Mr. Dhanraj Mulki has been appointed as a Company Secretary and has been designated as a Key Managerial Person with effect from 29th August, 2015.The Remuneration paid to Mr. Miket Shashikant Bahuva, erstwhile Company Secretary of the Company, for the period from 1st April, 2015 to 7th August, 2015 was ` 4.59 Lakh.

Board’s Report

VI. Penalties /Punishments / Compounding of Offences

Type Section of the Companies Act

Brief Description Details of Penalty / Punishment / Compounding fees imposed

Authority [RD / NCLT / Court]

Appeal made, if any (give details)

A. Company

PenaltyPunishment

Compounding

B. Directors Penalty

Punishment

Compounding

C. Other Officers in defaultPenalty

PunishmentCompounding

Nil

Board’s Report

71

Annual Report 1516

ANNEXURE – E

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGOPursuant to Section 134 of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014, the Company has taken the following energy conservation measures:

y LEDRetrofittinghasbeendoneat6propertiesacrossMaharashtra(PuneBundgarden,PuneFNS,PuneAmanora,Thane,Ghatkopar Neelyog and Dahisar).

y The Company has installed the Harmonic Filters in main power supply at Pune and Chennai to reduce the Electronic Harmonic Distortions which will give clean power to equipment & will result in reduction of electricity consumption.

y Auto Voltage Regulator (AVR) is installed at Pune & Lucknow which is maintaining constant Voltage in the said unit irrespective ofanyvoltagefluctuationfromtheelectricityboard.Ineffecttherateoffailureofbulbs,tubesandothercomponentshasbeen reduced considerably.

y Power factor is being maintained with the use of capacitor banks and auto power factor correction meter. These banks are used to neutralize the inductive current by providing capacitive current. As a result, the power factor improves and the Company gets rebate as may be applicable on energy bills from electricity distribution companies. The overall current consumption from the equipment has also reduced which leads to increase life cycle of the equipments like Motors and Heaters.

y All multiplexes have implemented Planned Preventive Maintenance (PPM) program where the schedule for all the engineeringandprojectionequipmentsarechalkedoutinadvancewiththePPMchart.AbenefitofthePPMprogramistoimprovetheefficiencyofthemachinesandminimizingbreakdowns.AsapartofPPMprogramtheairconditioningsystemgets overhauled and chemical dosing is used to recover the loss of ageing plus wear and tear. As a result, the electrical current required for getting the desired result has reduced.

y The operation timing of HVAC (Heat Ventilation and Air Conditioning) system and temperature is controlled with the help of Building Management System software (BMS) at some of the units of the Company.

y Eco-friendly source of electricity generated by the wind mill for the multiplex at Vadodara, Anand and Bharuch is used partially.

y Eco-friendly source of electricity generated through Mini hydro power plant for the Multiplex at Vijayawada is used partially. y Timers are being used to optimize the operational hours of lighting including other load within the premises. We have

started energy conservation meeting for all the units so as to create awareness about the energy conservation. The units like Vijayawada, Lucknow, Hyderabad, Thane, Malleshwaram (Bangalore), Rajarhat, Central Mall (Indore) have installed these Timers for common area lightings and Signages. Digital Timers are also installed for the AHU (Air Handling Units) which can precisely control the operation hours of AHU according to the schedule of the movies. Same process is being standardized for all upcoming multiplexes.

y The Company has successfully installed Variable Frequency Drive (VFD) for Audi AHU motors in most of the Multiplexes. This helps us to control the speed of Aircon motor as per the temperature and the occupancy. It helps to optimize energy consumption for Air conditioning system.

y Introducedmovementsensor intoiletsandback-officeareas.Thissensorfunctionsuponthephysicalmovementwhichhelps to reduce electrical energy. This is being standardized for all upcoming multiplexes.

The Company continues to use the latest technology for giving high quality movie viewing experience to its valued guests.

The foreign exchange earnings and outgo is as follows: (` in Lakh)

Current Year Previous Year

(a) Foreign exchange earnings Nil Nil(b) Foreign exchange outgo

- CIF value of Capital Goods imported 459.92 40.79- CIF Value of materials purchased 441.03 261.11- Travelling expenses 39.50 30.49- Interest on deferred credit 68.10 182.54Total 1,008.55 514.93

Board’s Report

ANNEXURE – F

(i) The percentage increase in remuneration of each Director, Chief Executive Officer, Chief Financial Officer and Company Secretary during the Financial Year 2015-16, ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the Financial Year 2015-16 and the comparison of remuneration of each Key Managerial Personnel (KMP) against the performance of the Company are as under:

Sr. No.

Name of Director / KMP and Designation Remuneration of Director / KMP for FY 2015-16 (` In Lakh)

% increase in remuneration in the Financial Year 2015-16

Ratio of Remuneration of each Director tomedianremuneration of employees

1. Mr. Pavan Jain, Chairman & Non-executive Director * * *

2. Mr. Vivek Jain, Non-executive Director * * *

3. Mr. Deepak Asher, Non-executive Director # 30.00 Not Applicable 10.06:1

4. Mr. Siddharth Jain, Non-executive Director * * *

5. Mr. Haigreve Khaitan, Independent Director * * *

6. Mr. Amit Jatia, Independent Director * * *

7. Mr. Kishore Biyani, Independent Director * * *

8. Ms. Girija Balakrishnan, Independent Director * * *

9. Mr.AlokTandon,ChiefExecutiveOfficer 93.96 5%

Not Applicable10. Mr.UpenShah,ChiefFinanceOfficer 56.30 5%

11. Mr. Miket S. Bahuva, Company Secretary $ 4.59 -

12. Mr. Dhanraj Mulki, Company Secretary $ 26.39 -

* For this purpose, Sitting Fees paid to the Director have not been considered as Remuneration.

# Mr. Deepak Asher is being paid Professional Fees of ` 30.00 Lakh p.a. with effect from 1st April 2014 for his professional services for strategic businessplanning,formulationandimplementationofvariousgrowthstrategiesfortheCompanyaswellasfinancialplanningandmanagementof the Company.

$ Mr. Miket Shashikant Bahuva has resigned as a Company Secretary with effect from 7th August 2015 and Mr. Dhanraj Mulki has been appointed as a Company Secretary & Vice President – Legal and has been designated as a Key Managerial Person with effect from 29th August 2015

Board’s Report

73

Annual Report 1516

Board’s Report

(ii) Percentage increase in the median remuneration of employees in the Financial Year is 4%.

(iii) The number of permanent employees on the rolls of company as on 31st March, 2016 was 1829.

(iv) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last Financial Year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration;

Average percentile increase in the salaries of employees other than the managerial personnel in the last Financial Year is 4% and percentile increase in the managerial remuneration is 5%.

(v) Affirmation that the remuneration is as per the remuneration policy of the company. TheCompanyaffirmsthattheremunerationisaspertheNominationandRemunerationpolicyoftheCompany.

In terms of Section 136 of the Companies Act, 2013, the Report and Accounts are being sent to the Members of the Company excluding information on employees’ particulars required to be provided in accordance with the provisions of Section 197 (12) of the Act, read with Rules 5 (2) and 5 (3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules,2014,asamended.ThisstatementisavailableforinspectionbytheMembersattheRegisteredOfficeofthe Company during the business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining such information may write to the Company Secretary at the Registered OfficeoftheCompany.

Board’s Report

ANNEXURE – G

Report on CSR Activities of the Company as per Companies (Corporate Social Responsibility Policy Rules, 2014

Sr. No.

Particulars Compliance

1. A brief outline of CSR Policy including outline of company’s CSR Policy, including overview of projects or programs proposed to be undertaken and a reference to the web-link to the CSR Policy and project or programs

CSR Policy adopted by the Company includes all the activities which are prescribed under Schedule VII of the Companies Act, 2013. The CSR Policy of the Company can be viewed on website of the Company at https://www.inoxmovies.com/Corporate.aspx?Section=3

2. The Composition of CSR Committee Mr. Haigreve Khaitan, Independent DirectorMr. Pavan Jain, Non-Independent DirectorMr. Deepak Asher, Non-Independent Director

3. AveragenetprofitoftheCompanyforlastthreeFinancial Years

` 3401.30 Lakh

4. Prescribed CSR Expenditure (2% of the amount as in item 3 above.)

` 68.03 Lakh

5. Details of CSR spent during the Financial Yeara. Total amount to be spent for the Financial Yearb. Amount unspent, if anyc. Manner in which the amount spent during

Financial Year is detailed below

` 68.03 Lakh` 63.03 Lakh

(1) (2) (3) (4) (5) (6) (7) (8)Sr. No.

CSR project or activity identified

Sector in which the project is covered – Schedule VII

Projects or programs (1) Local area or (2) Specify the State and District where projects or programs were undertaken

Amount outlay (budget project or programs wise)

Amount spent on the projects or programs sub-heads (1) Direct expenditure on projects or programs (2) Overheads(` in Lakh)

Cumulative expenditure upto the reporting period

Amount spent Direct or through implementing agency

1. Contribution to INOX Group CSR Trust

NA Expenditure on CSR build capacity through implementing agency

5.00 5.00 5.00 Through INOX Group CSR Trust

6. In case the Company has failed to spend the two percent of the average net profit of last threeFinancial Years or any part thereof, the company shall provide reasons for not spending the amount in its Board Report.

TheCompany is obtaining advisory services for identification ofCSR Projects for its CSR activities and will spend the amount on identificationofCSRProjects.

7. A responsibility statement of the CSR committee that the implementation and monitoring of CSR Policy is in compliance with CSR objectives and Policy of the Company.

The implementation and monitoring of CSR Policy is in compliance with CSR objectives and Policy of the Company.

Sd/- Sd/-Alok Tandon Mr. Haigreve KhaitanChief Executive Officer Chairman - CSR Committee

Mumbai Mumbai8th August, 2016 8th August, 2016

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Annual Report 1516

AUDITOR'S CERTIFICATE REGARDING COMPLIANCE OF CONDITIONS OF CORPORATE GOVERNANCE

To the Members of INOX Leisure Limited

We have examined the compliance of conditions of Corporate Governance by INOX Leisure Limited, for the Financial Year ended on 31st March 2016, as stipulated in Clause E of Schedule V of the Securities and Exchange Board of India (Listing obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations).

The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the Financial Statements of the company.

In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the Listing Regulations in all material respect.

WefurtherstatethatsuchcomplianceisneitheranassuranceastothefutureviabilityoftheCompanynortheefficiencyoreffectiveness with which the Management has conducted the affairs of the Company.

For and on behalf ofPatankar & Associates

Chartered AccountantsFirm Registration no 107628W

S.S. AgrawalPlace: Pune Membership No 049051Date: 8th August, 2016 Partner

Board’s Report

Corporate Governance Report

In compliance with Regulation 34 (3) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as Listing Regulations), INOX Leisure Limited (“the Company”) is pleased to submit this report on the matters mentioned in the Para C of Schedule V of the Listing Regulations and the practices followed by the Company in this regard.

1. A BRIEF STATEMENT ON THE COMPANY’S PHILOSOPHY ON CODE OF GOVERNANCE:

Corporate Governance is the system by which Companies are directed and controlled by the Management in the best interest of the Shareholders and others, ensuring greater transparency as well as better and timely financial reporting. CorporateGovernance, therefore, generates long term economic value for its Stakeholders.

INOXLeisureLimitedbelievesthattheimplementationofCorporateGovernanceprinciplesgeneratespublicconfidenceinthecorporatesystem.Withthisbelief,theCompanyhasinitiatedsignificantmeasuresforcompliancewithCorporateGovernance.

2. BOARD OF DIRECTORS:

(a) Composition and Category of Directors As at the end of the Financial Year on 31st March, 2016, the Board consisted of Eight Directors and all of them are Non-

ExecutiveDirectorshavingconsiderableexperienceintheirrespectivefields.TheBoardofDirectorsconsistedof4Non-Independent Directors and 4 Independent Directors, including one woman Director.

(b) Number of Meetings of the Board of Directors held with the dates, attendance of each Director at the Meeting of the Board of Directors and the last Annual General Meeting, disclosure of relationships between Directors inter-se and Number of Shares and Convertible Instrument held by Non- Executive Directors

During the Financial Year 2015-16, the Board met 7 (Seven) times on following dates namely, 14th May, 2015, 25th May, 2015, 17th July, 2015, 29th August, 2015, 23rd October, 2015, 4th February, 2016 and 1st March, 2016.

The following table gives details of Directors, details of attendance of Directors at Board Meetings, at the Annual General Meeting, Number of Memberships held by the Directors in the Board / Committees of various Companies and Number of Shares held by non-executive Directors as on 31st March, 2016.

Name of Director

Category of Director Number of Board meetings attended

Whether attended last Annual General Meeting

Relationship between Directors inter-se

Number of Shares held by Non-Executive Directors

Mr. Pavan Jain Chairman, Non-Executive – non Independent

7 No Brother of Mr. Vivek Jain and father of Mr. Siddharth Jain

350,000

Mr. Vivek Jain Non-Executive – non Independent

5 No Brother of Mr. Pavan Jain

650,445

Mr. Deepak Asher Non-Executive – non Independent

7 Yes Not related to any Director

25,000

Mr. Siddharth Jain Non-Executive – non Independent

6 No Son of Mr. Pavan Jain 600,000

Mr. Haigreve Khaitan

Non-Executive - Independent


0

Mr. Amit Jatia Non-Executive - Independent

5 No Not related to any Director

0

Mr. Kishore Biyani Non-Executive - Independent

7 No Not related to any Director

0

Ms. Girija Balakrishnan

Non-Executive - Independent


0

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The Company has not issued any Convertible Instruments and hence, the details in respect of such Convertible Instruments held by Non-Executive Directors are not provided.

Mr. Pavan Jain, Mr. Vivek Jain and Mr. Deepak Asher jointly as a trustee of INOXBenefitTrustholds43,50,092equityshares.

Mr. Pavan Jain as a trustee of “INOX Leisure Limited- Employees Welfare Trust” (ESOP Trust) holds 295,001 equity shares.

(c) Number of Directorships and Committees Membership / Chairmanship:

Name of Director Category of Director Number of other Directorships / Committee Memberships / Chairmanships

Other Directorship#

Committee(*)Membership of Public Limited

Companies

Chairpersonship of Listed Companies

Mr. Pavan Jain Chairman, Non-Executive –non Independent

8 4 1

Mr. Vivek Jain Non-Executive – non Independent

10 2 0

Mr. Deepak Asher Non-Executive – non Independent

7 9 0

Mr. Siddharth Jain Non-Executive – non Independent

8 3 0

Mr. Haigreve Khaitan Non-Executive - Independent 10 9 2Mr. Amit Jatia Non-Executive - Independent 11 3 0Mr. Kishore Biyani Non-Executive - Independent 7 3 1Ms. Girija Balakrishnan

Non-Executive - Independent 1 0 0

*Committee means Audit Committee and Stakeholders’ Relationship Committee as per Regulation 26 of the Listing Regulations.

# Other Directorship excludes Directorship of Foreign Companies and Companies registered under Section 25 of the Companies Act, 1956 now Section 8 of the Companies Act, 2013.

None of the Directors are Directors in more than 10 Public Limited Companies or act as an Independent Director in more than 7 Listed Companies. Further, none of the Directors act as a Member of more than 10 Committees or act as a Chairman of more than 5 Committees across all Public Limited Listed Companies.

(d) Web link of Familiarization Programmes imparted to Independent Directors Details of Familiarization Programmes imparted to Independent Directors have been disclosed on the Website of the

company. The same can be viewed at https://www.inoxmovies.com/Corporate.aspx?Section=3.

(e) INDEPENDENT DIRECTORS Separate Meeting of Independent Directors: As stipulated under Section 149 of the Companies Act, 2013 read with Schedule IV pertaining to the Code of Independent

Directors and the Listing Regulations, a separate Meeting of the Independent Directors of the Company was held on 4th February, 2016 with the following agenda:

• to review performance of Non-Independent Directors and the Board as a whole,

• to review the performance of the Chairperson of the Company, taking into account the views of the Executive and Non-Executive Directors of the Company and

• toassessthequality,quantityandtimelinessofflowofinformationbetweentheCompanyManagementandtheBoardthat is necessary for the Board to effectively and reasonably perform their duties.

3. AUDIT COMMITTEE

(a) Terms of Reference of the Audit Committee: TheRoleandtheTermsofReferenceofAuditCommitteewereredefinedattheMeetingoftheBoardofDirectorsheld

on 27th May, 2014 which are in accordance with the requirements of Section 177 of the Companies Act, 2013 read with relevant Rules made thereunder and Regulation 18 of the Listing Regulations read with part C of Schedule II of the Listing Regulations.

The brief description of Terms of Reference of Audit Committee is given below:

1. Oversightofthecompany’sfinancialreportingprocessandthedisclosureofitsfinancialinformationtoensurethatthefinancialstatementiscorrect,sufficientandcredible;

2. Recommendation for appointment, remuneration and terms of appointment of auditors of the company;

3. Approval of payment to statutory auditors for any other services rendered by the statutory auditors;

4. Reviewing,withthemanagement,theannualfinancialstatementsandauditor'sreportthereonbeforesubmissiontothe board for approval, with particular reference to:

a. Matters required to be included in the Director’s Responsibility Statement to be included in the Board’s report in terms of clause (c) of sub-section 3 of section 134 of the Companies Act, 2013

b. Changes, if any, in accounting policies and practices and reasons for the same

c. Major accounting entries involving estimates based on the exercise of judgment by management

d. Significantadjustmentsmadeinthefinancialstatementsarisingoutofauditfindings

e. Compliancewithlistingandotherlegalrequirementsrelatingtofinancialstatements

f. Disclosure of any related party transactions

g. Qualificationsinthedraftauditreport

5. Reviewing,withthemanagement,thequarterlyfinancialstatementsbeforesubmissiontotheBoardforapproval;

6. Reviewing, with the management, the statement of uses / application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer document / prospectus / notice and the report submitted by the monitoring agency monitoring the utilisation of proceeds of a public or rights issue, and making appropriate recommendations to the Board to take up steps in this matter;

7. Review and monitor the auditor’s independence and performance, and effectiveness of audit process;

8. ApprovaloranysubsequentmodificationoftransactionsoftheCompanywithrelatedparties;

9. Scrutiny of inter-corporate loans and investments;

10. Valuation of undertakings or assets of the Company, wherever it is necessary;

11. Evaluationofinternalfinancialcontrolsandriskmanagementsystems;

12. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;

13. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffingandseniorityoftheofficialheadingthedepartment,reportingstructurecoverageandfrequencyofinternalaudit;

14. Discussionwithinternalauditorsofanysignificantfindingsandfollowupthereon;

15. Reviewingthefindingsofany internal investigationsbythe internalauditors intomatterswherethere issuspectedfraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board;


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16. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern;

17. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors;

18. To review the functioning of the Whistle Blower mechanism;

19. ApprovalofappointmentofCFO(i.e., theWhole-timeFinanceDirectororanyotherpersonheading thefinancefunction or discharging that function) after assessing the qualifications, experience and background, etc. of thecandidate;

20. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee.

(b) Composition, Name of Members, Chairperson, Meetings & Attendance during the year: The Audit Committee comprises of Four Directors with Mr. Haigreve Khaitan as the Chairman of the Committee. The

composition of Audit Committee is in compliance of Section 177 of the Companies Act, 2013 read with relevant Rules made thereunder and Regulation 18 of the Listing Regulations.

During the Financial Year 2015-16, the Audit Committee met 5 (Five) times on the following dates, namely, 14th May, 2015, 25th May, 2015, 17th July, 2015, 23rd October, 2015 and 4th February, 2016.

The details of composition of Audit Committee and the Meetings attended by the Directors are given below:

Name of the Director Position Number of Meetings AttendedMr. Haigreve Khaitan, Independent Director Chairman 5Mr. Deepak Asher, Non-Independent Director Member 5Mr. Amit Jatia, Independent Director Member 3Mr. Kishore Biyani, Independent Director Member 5

Mr. Haigreve Khaitan, Chairman of the Audit Committee had attended the previous Annual General Meeting of the Company held on 28th September, 2015.

4. COMPENSATION, NOMINATION & REMUNERATION COMMITTEE

(a) Brief description of Terms of Reference: TheTermsofReferenceofCompensation,NominationandRemunerationCommitteeweredefinedattheMeetingofthe

Board of Directors held on 27th May, 2014 which are in accordance with the requirements of Section 178 of the Companies Act, 2013 read with relevant Rules made thereunder and Regulation 19 of the Listing Regulations read with part D of Schedule II of the Listing Regulations.

The brief description of Terms of Reference is given below:

a) Implementation, administration and superintendence of the ESOP Scheme and formulate the detailed Terms & Conditions of the ESOP Scheme.

b) To frame suitable policies and system to ensure that there is no violation of SEBI (Insider Trading) Regulations, 1992 and SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to the Securities Market) Regulations, 1995 by any employee.

c) To exercise roles, powers and duties as vested under Schedule V to the Companies Act, 2013 and Listing Regulations and to take decisions about remuneration payable to managerial personnel from time to time.

d) LaydowntheCriteriaforidentifypersonswhoarequalifiedtobecomedirectorsandwhomaybeappointedinseniormanagement and recommend to the Board their appointment and removal.


e) Carry out evaluation of every director’s performance.

f) Formulatethecriteriafordeterminingqualifications,positiveattributesandindependenceofadirector.

g) Recommend to the Board a policy, relating to the remuneration for the directors, key managerial personnel and other employees.

h) Devising a policy on Board diversity.

(b) Composition, Name of Members, Chairperson, Meetings & Attendance during the Financial Year 2015-16: The composition of Compensation, Nomination and Remuneration Committee is in compliance with Section 178 of the

Companies Act, 2013 read with relevant Rules made thereunder and Regulation 19 of the Listing Regulations. During the Financial Year 2015-16, the Compensation, Nomination and Remuneration Committee met 2 (Two) times on following dates namely, 14th May, 2015 and 29th August, 2015.

The details of composition of the Compensation, Nomination & Remuneration Committee (up to 23rd October, 2015) together with the Meetings held and attendance is as follows:

Name of Director Position Number of Meetings AttendedMr. Haigreve Khaitan, Independent Director Chairman 1Mr. Deepak Asher, Non- Independent Director Member 2Mr. Amit Jatia, Independent Director Member 1

At the Meeting of Board of Directors of the Company held on 23rd October, 2015, the composition of Compensation, Nomination & Remuneration Committee was changed as follows:

Name of Director PositionMr. Haigreve Khaitan, Independent Director ChairmanMr. Siddharth Jain, Non- Independent Director MemberMr. Amit Jatia, Independent Director Member

(c) Performance Evaluation Criteria for Independent Directors The Board of Directors had at its Meeting held on 4th February, 2016 evaluated performance of Independent Directors. A

structured questionnaire in form of Performance Evaluation Form that covered the criteria for evaluation of Independent Directors as laid down by the Companywhich includeQualifications, Experience, Personal attributes like Honesty &Integrity, Independence, Professional Skills, Contribution to Board Meetings, etc. was given to each Director to provide their feedback.DulyfilledupthePerformanceEvaluationFormswerereturnedtotheCompany.PerformanceofIndependentDirectors was evaluated by the entire Board, excluding the Independent Director being evaluated at the said Meeting. The feedbackgivenbytheDirectorsreflectedhighlysatisfactoryperformanceofIndependentDirectors.

The Chairman of Compensation, Nomination and Remuneration Committee had authorised Mr. Deepak Asher, Director to answer to the queries of the Shareholders at the Annual General Meeting of the Company held on 28th September, 2015.

5. REMUNERATION TO DIRECTORS

All the Directors of the Company are Non-Executive Directors. Members of the Company have passed a Special Resolution dated 13th January, 2015 approving the payment of Professional Fees to Mr. Deepak Asher, Non-executive Director of the Company. No other Non-Executive Director is being paid any remuneration except sitting fees. All the Directors are paid sitting fees of ` 20,000 for attending the Meetings of the Board or Committee thereof and adjournments thereto. The details of total remuneration paid to the Directors for the year 2015-16 are given below:

Name of Director Sitting Fees* Professional Fees TotalMr. Pavan Jain 1,40,000 - 1,40,000Mr. Vivek Jain 1,00,000 - 1,00,000


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Annual Report 1516

Name of Director Sitting Fees* Professional Fees TotalMr. Deepak Asher 2,80,000 30,00,000 32,80,000Mr. Siddharth Jain 1,20,000 - 1,20,000Mr. Haigreve Khaitan 2,80,000 - 2,80,000Mr. Amit Jatia 2,00,000 - 2,00,000Mr. Kishore Biyani 2,60,000 - 2,60,000Ms. Girija Balakrishnan 1,60,000 - 1,60,000Total 15,40,000 30,00,000 45,40,000

* Includes sitting fees paid for Board and Committee Meetings.

During the Financial Year 2015-16, the Company has not issued stock options at discount.

Criteria for making payment to Non-Executive Directors is disclosed on the Company’s website. The same can be viewed at https://www.inoxmovies.com/Corporate.aspx?Section=3.

6. STAKEHOLDERS’ RELATIONSHIP COMMITTEE

(a) Name of Non-Executive Director heading the Committee Mr. Pavan Jain(b) NameanddesignationofComplianceOfficer Mr. Dhanraj Mulki,

Company Secretary

(c) Number of Shareholders complaints received during the Financial Year 2015-16 Nil(d) Number not resolved to the satisfaction of Shareholders Nil(e) Number of pending complaints Nil

The Chairman of Stakeholders’ Relationship Committee had authorised Mr. Deepak Asher, Director to answer to the queries of the Shareholders at the Annual General Meeting of the Company held on 28th September, 2015.

A total of 2295 equity shares of the Company (including 395 shares pertaining to 4 shareholders of erstwhile Fame India Limited remaining unclaimed since initial public issue in 2005) had remained unclaimed subsequent to the initial public issue of the Company in 2006. In compliance with provisions of Para F of Schedule V of the Listing Regulations, aforesaid shares have been transferred to “INOX Leisure Limited – Unclaimed Suspense Account”.

Particulars No of Shareholders

No. of Shares

Aggregate number of shareholders and the outstanding shares in the suspense account lying at the beginning of the year

42 2295

Number of shareholders who approached the Company for transfer of shares from suspense account during the year

0 0

Number of shareholders to whom shares were transferred from suspense account during the year

0 0

Aggregate number of shareholders and the outstanding shares in the suspense account lying at the end of the year

42 2295

The voting rights in respect of above shares shall remain frozen till the rightful owner claims such shares.


7. GENERAL BODY MEETINGS:

The particulars of the last three (3) Annual General Meetings (AGM) of the Company and details of Special Resolutions passed, if any, are given hereunder:

Financial Year Date and Time Location Special Resolution Passed

2012- 13 14th AGM on 23rd August, 2013 at 11.00 a.m.

Maple Hall, Hotel Express Residency, 18/19, Alkapuri Society, Vadodara – 390 007

1. Payment of Managerial Remuneration to Mr. Rajeev Patni, Manager & Director – Operations of erstwhile Fame India Limited

2. Alteration of the Articles of Association of the Company.

2013-14 15th AGM on 10th September 2014 at 11.00 a.m.

1. Authority to the Board of Directors of the Company to borrow of money in excess of Paid-up Capital and Free Reserves of the Company.

2. Authority to the Board of Directors of the Company to create charge or mortgage in favour of lending institutions or to sell, lease or dispose of undertaking of the Company.

3. Approval of existing transaction with Related Party and also to renew the same from time to time at any time in future.

4. Authority to the Board to enter into the fresh transactions with the Related Parties and to renew the same from time to time in future.

5. Private Placement of Non-convertible Debentures and/ or other Debt Securities.

2014-15 16th AGM on 28th September 2015 at 11.00 a.m.

No Special Resolution was passed in the Annual General Meeting.

During the Financial Year ended 31st March, 2016, no Special Resolution was passed by the Company’s Members through Postal Ballot.

No Special Resolution is proposed to be conducted through Postal Ballot at the ensuing Annual General Meeting of the Company.

8. MEANS OF COMMUNICATION:

The Quarterly / Annual Financial Results of the Company during the Financial Year ended 31st March, 2016 were submitted to the Stock Exchanges immediately after they were approved by / taken on record by the Board and published in well-circulated Gujarati Newspapers (Financial Express / Loksatta Jansatta / Indian Express) and English Dailies (Indian Express / Business Standard /FinancialExpress)aswell.Thesaidresultsalongwithofficialnewsreleasesandpresentationsmadetotheinstitutionalinvestors/ analysts have been submitted to the stock exchanges and also posted on the Company’s website viz.: www.inoxmovies.com.

9. GENERAL SHAREHOLDER INFORMATION:

(a) Annual General Meeting (AGM) : • Date : Saturday, 24th September, 2016 • Time : 12.00 noon • Venue : Maple Hall, Hotel Express Residency, 18/19, Alkapuri Society, Vadodara - 390 007

(b) Financial year : April, 2015 to March, 2016.

(c) Book Closure Dates : Saturday, 17th September, 2016 to Saturday, 24th September, 2016 (both days inclusive)

(d) Dividend Payment Date : Not Applicable as no dividend is proposed.


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Annual Report 1516

(e) Listing on Stock Exchanges :

1. National Stock Exchange of India Limited (NSE) Exchange Plaza, Plot No. C/1, G Block, Bandra Kurla Complex, Bandra (East), Mumbai – 400 051

2. BSE Limited (BSE) Jeejeebhoy Towers, Dalal Street, Mumbai – 400 001

Listing Fees: TheCompanyhaspaidtheannuallistingfeesforthefinancialyear2015-16totheNSEandBSEonwhichthesecurities

are listed.

(f) Stock Code: NSE : INOXLEISUR BSE : 532706

(g) Market Price Data: High, Low during each month in the Financial Year 2015-16

Month NSE Monthly HighHigh Price (in Rs)

NSE Monthly Low Price (in Rs)

BSE Monthly High Price (in Rs)

BSE Monthly Low Price (in Rs)

April, 2015 181.40 149.65 181.50 150.00May, 2015 167.00 145.15 165.60 145.00June, 2015 179.85 155.80 181.90 154.00July, 2015 248.70 173.55 248.85 173.40August, 2015 269.80 202.10 269.60 199.50September, 2015 249.70 216.50 240.60 216.15October, 2015 275.90 227.00 276.30 226.20November, 2015 246.70 220.10 245.60 220.20December, 2015 254.40 229.50 254.00 217.00January, 2016 241.95 183.00 241.80 184.00February, 2016 224.90 170.75 224.60 170.00March, 2016 214.00 186.00 214.00 186.70

(h) Performance in comparison to broad-based indices viz. Nifty 500 and BSE Sensex:

Date Nifty 500 Company’s Share Price on NSE1st April, 2015 6975.80 167.8531st March, 2016 6452.15 192.20Change (7.51)% +14.51%

Date BSE Sensex Company’s Share Price on BSE1st April, 2015 27,954.86 169.2031st March, 2016 25,341.86 191.70Change (9.35)% +13.30%

The Equity Shares of the Company were not suspended from Trading during the Financial Year 2015-16.

(i) Registrar and Transfer Agents: For lodgment of transfer deeds and other documents or any grievances / complaints, Investors may contact the Company’s

Registrar and Transfer Agent at the following address:


Karvy Computershare Private Limited Karvy Selenium Tower No. B, Plot No.31-32, Gachibowli, Financial District, Nanakramguda, Hyderabad – 500 032.

(j) Share Transfer System: Trading in Company’s shares on the Stock Exchange takes place in electronic form. However, the share transfers which

arereceivedinphysicalformareprocessedandtheShareCertificatesreturnedwithinaperiodof15daysfromthedateofreceipt, subject to the documents being valid and complete in all respects.

(k) Distribution of Shareholding & Shareholding Pattern:

Shareholding of Nominal Value

Number of Shareholders

% to Total Number of Shares

Amount in Rupees

% to Total

1 – 5000 32511 92.18 2888571 28885710 2.995001 – 10000 1588 4.50 1216502 12165020 1.2610001 – 20000 593 1.68 880501 8805010 0.9120001 – 30000 174 0.49 444905 4449050 0.4630001 – 40000 84 0.24 296219 2962190 0.3140001 – 50000 73 0.21 340551 3405510 0.3550001 – 100000 98 0.28 718534 7185340 0.74100001 & Above 149 0.42 89671971 896719710 92.97TOTAL 35270 100.00 9,64,57,754 96,45,77,540 100.00

(l) Shareholding Pattern as on 31st March, 2016 is as under.

Category Number of Shares held

Percentage of Total Shareholding

Promoter's holding - Indian Promoters 4,69,73,928 48.70%Sub-Total 4,69,73,928 48.70%Non-Promoters HoldingInstitutional Investors - Mutual Funds /UTI 76,63,131 7.94% - Financial Institutions/Banks 41,819 0.04% - Foreign Institutional Investors 2,25,28,638 23.36%Sub-Total 3,02,33,588 31.34%OthersBodies Corporate 29,96,733 1.62%Indian Public 1,12,05,056 11.62%Non Resident Indians 2,97,004 0.31%Any other- NBFCs registered with RBI 12,026 0.01%- Trusts 43,51,493 4.51%- Clearing Members 92,925 0.10%EmployeeBenefitTrust(underSEBI(SharebasedEmployeeBenefit)Regulations, 2014)

2,95,001 0.31%

Sub-Total 1,92,50,238 19.96%Grand Total 9,64,57,754 100.00%


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Annual Report 1516


(m) Dematerialization of shares: The Company’s Equity Shares are traded compulsorily in dematerialized form. Approximately 99.69% of the Equity Shares

are in dematerialized form. ISIN number for dematerialization of the equity shares of the Company is INE312H01016.

(n) Outstanding GDRs/ADRs/Warrants/ any Convertible Instruments: The Company has not issued GDRs/ADRs/Warrants or any Convertible Instruments.

(o) Commodity price risk or foreign exchange risk and hedging activities; The Company has approved “Risk Assessment and Minimization Procedure” pursuant to which the Company enters into

Forward Contracts on foreign currencies depending on its assessment of the market situation, to counter the risk of foreign exchangefluctuations.

(p) Property Locations: The Multiplex Cinema Theatres of the Company are situated at the following places:

Sr. No.

City Location

1 Pune Plot No. D, Bund Garden Road, Near Hotel Central Park, Pune.2 Vadodara Race Course, Gopal Baug, Ellora Park, Vadodara.3 Kolkata Forum, 10 / 3, Elgin Road, Kolkata.4 Kolkata City Centre, DC Block 1, Sector 1, Kolkata.5 Goa Old GMC Heritage Precinct, D. B. Road, Campal, Panaji, Goa.6 Mumbai CR2, 2nd Floor, Opp. Bajaj Bhavan, Nariman Point, Mumbai.7 Bengaluru 4th Floor, Garuda Mall, Magrath Road, Bengaluru.8 Jaipur Amrapali Circle, Vaishali Nagar, Jaipur.9 Indore Sapna Sangeeta Mall, Sapna Sangeeta Road, Sneha Nagar, Indore.10 Darjeeling Rink Mall, 19, Laden La Road, Darjeeling, West Bengal.11 Kota Plot No. Sp 11, Indra Vihar, Kota.12 Nagpur Poonam Mall, Vardhaman Nagar, Nagpur.13 Chennai 3rd Floor, Chennai City center, 10/11, R.K. Salai, Near Kalyani Hospital, Mylapore, Chennai.14 Jaipur City Plaza, Nirman Marg, Jhotwara Road, Bani Park, Jaipur.15 Bharuch Shree Rang Palace, Zadeshwar Road, Bharuch, Gujarat.16 Jaipur 4th Floor, Crystal Palm, Sahkar Circle Scheme, Sardar Patel Marg, Jaipur.17 Lucknow 4th Floor, Riverside Mall, Vipin Khand, Gomti Nagar, Lucknow.18 Raipur 3rd Floor, City Mall 36, G. E. Road, NH-6, Raipur.19 Kolkata 89C, Moulana Abul Kalam Azad Sarani, Kolkata.20 Vijayawada Urvashi Theatre Complex, Andhra Ratna Road, Gandhi Nagar, Vijayawada.21 Faridabad 3rd Floor, Crown Interiorz Mall, Sec-35, Delhi Mathura Road, Faridabad.22 Nagpur Jaswant Tuli Mall, Kamptee Road, Indora Chowk, Nagpur.23 Bengaluru 4th Floor, Shree Garuda Swagath Mall, Tilak Nagar Main Road, Jayanagar, Bengaluru.24 Burdwan 4th Floor, Burdhwan Arcade, 60, B.B Ghosh Road, Burdwan.25 Hyderabad 5th Floor, GVK One Mall, Opposite Water Tank, Road No. 1, Banjara Hills, Hyderabad.26 Siliguri 5th Floor, Orbit Mall, 3rd Mile, Sevoke Road, Siliguri.27 Kolkata 3rd Floor, City Centre New Town Mall, New Town, Rajarhat, Kolkata.28 Indore 4th Floor, Indore Central, 170, R.N.T. Marg, Regal Square, Indore.29 Thane 3rd Floor, Korum Mall, Mangal Pandey Road, Eastern Express Highway, Thane.30 Vizag Survey No. 120 & 121, Maharanipet, Rama Krishna Beach Road, Visakhapatnam.31 Vizag Survey No. 67, CMR Mall, Maddilapalem, Visakhapatnam.32 Bengaluru 3rd Floor, Mantri Square, No.1, Sampige Road, Malleshwaram, Bengaluru.


Sr. No.

City Location

33 Belgaum HeadPostOfficeRoad,Camp,Belgaum,Karnataka.34 Jaipur Pink Square Mall, Raja Park, Jaipur.35 Kanpur 3rd Floor, Z Square Mall, Bada Chauraha, M. G. Road, Kanpur.36 Bengaluru 5th Floor, Bengaluru Central, 45th Cross, J. P. Nagar 2nd Phase, Bengaluru.37 Liluah R. D. Mall, 269 G. T. Road, Liluah, Howrah, West Bengal.38 Siliguri City Centre, Matigara, Siliguri, West Bengal.39 Vijaywada 3rd Floor, LEPL Icon, Patamata, Vijayawada.40 Hyderabad 5th Floor, Maheshwari Parameshwari Mall, Kachiguda Cross Road, Hyderabad.41 Navi Mumbai Glomax Mall, Kharghar, Navi Mumbai.42 Pune 2nd Floor, Amanora Park Town, East Blok, Hadapsar, Pune.43 Bhubaneswar 4th Floor, BMC Bhawani Mall, Saheed Nagar, Opp. Arya Samaj, Bhubaneswar.44 Udaipur 5th Floor, Lake City Mall, Porawalaji Ki Wadi, Ashok Nagar, Udaipur. 45 Bhopal 1st Floor, Century 21 Mall, Hoshangabad Road, Bhopal. 46 Nashik Old Vijay Mamta Theatre, Opp. Prasad Chambers, Nashik Pune Road, Nashik.47 Mumbai Raghuleela Mall, Behind Poisar Bus Depot, Off S.V. Road, Kandivali (West), Mumbai.48 Kolkata Metropolis Mall, Hiland Park, Opp. Pearless Hospital, E.M. By Pass, Kolkata.49 Mumbai Inorbit Mall, New Link Road, Near Subkuch Market, Malad (West), Mumbai.50 Pune Jai Ganesh Vision Mall, Near Olympia Service Station Akurdi, Pune.51 Aurangabad Old Anuradha Anupama Cinema, Tapadia Mall, Sector - C-2 Town Center, CIDCO,

Aurangabad - 431 003.52 Mumbai Nakshatra Cine Shoppe, Rande Road, Near Dadar Railway Station, Dadar (West), Mumbai.53 Anand City Pulse Theaters Ltd., Nr. Hero Honda Showroom, S.N. Motors, Anand - Vidyanagar Road,

Anand.54 Mumbai 3rd Floor, Thakur Mall, Near Dahisar Check Naka, Dahisar (East), Mumbai.55 Mumbai 4th Floor, Vishnu Shivam Mall, Thakur Village, Kandivali (East), Mumbai.56 Bengaluru Next To Ista Hotel, Off M.G. Road, Ulsoor, Bengaluru.57 Kolkata Southcity Projects Ltd, 375, Prince Anwar Shah Road, Kolkata.58 Navi Mumbai 3rd Floor, Raghuleela Mall, Opp. Vashi Railway station, Vashi, Navi Mumbai.59 Bengaluru Public Utility Building, M G Road, Bengaluru.60 Pune 1st Floor, Fun & Shop Mall, Opp. Bhairoba Nallah, Fatima Nagar, Hadapsar, Pune.61 Mumbai Neelyog Bulding Patel Chowk, R.B. Road, Ghatkopar (East), Mumbai.62 Kalyan Metro Junction Mall, Netivalli Village, Near Sheel Phata, Kalyan (East), Kalyan.63 Vadodara SevenSeasMall,NearFategungPostOffice,NearIPCLCircleFatigung,Vadodara.64 Bharuch Shalimar Takies, Station Road, Bharuch.65 Dhanbad Galleria Mall, Saraidhela, Sahyogi Nagar, Sector 2, Govindpur Road, Dhanbad.66 Bengaluru Prestige Forum Value Mall, Survey No. 62, Near Varthur Kodi, White Field Road, Bengaluru.67 Chennai Chandra Metro Mall, Door No. #92 New # 262 Arcot Road, Virugambakkam, Chennai68 Kolkata Hind Cinema, Bow Bazar, Kolkata.69 Surat VR Surat, Dumas Road, Magdalla, Surat, Gujarat.70 Vizianagaram 3rd Floor, NCS Mall, Bochu Peta, Opp. RTC Complex, Vizianagaram.71 Panchkula 3rd Floor, NH-22 Mall, Amravati Enclave, Sector 2, Pinjore-Kalka Urban Complex, Panchkula. 72 Raipur 1st Floor, City Centre Mall, Vidhan Sabha Road, Mowa, Raipur.73 Jaipur 3rd Floor, Elements Mall, Ajmer Road, Jaipur. 74 Madurai 5th Floor, Vishaal de Mal, 31, Gokhale Road, Chinna Chokkikulam, Madurai.75 Noida 3rd Floor, MSX Mall, Swarn Nagari, Gate No.1, Greater Noida, Uttar Pradesh.

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Sr. No.

City Location

76 Kolkata 4th Floor, Quest Mall, 33, Syed Amir Ali Avenue, Kolkata.77 Manipal 1st Floor, Central Cinemas, Laxmindra Nagar, Udupi Main Road, Manipal. 78 Gurgaon 3rd Floor, Gurgaon Dreamz Mall, Sector 4 - 7 Circle, Old Railway Road, Gurgaon. 79 Vizag* 4th Floor, Chitralayaa, Suryabagh, Visakhapatnam. 80 Jalgaon 2nd Floor, khandesh Central Station Road, Jalgaon.81 Faridabad EF – 3 Mall, Sector 20 – A, Mathura Road, Faridabad, Haryana.82 New Delhi 1st Floor, Eros One (Eros Cinema Building), Jangpura Extension, New Delhi.83 Kurnool 3rd Floor, Jyoti Mall, Opposite Zilla Parishat, Bellary Road, Kurnool, Andhra Pradesh.84 Ajmer 3rd Floor, City Square Mall, Panchsheel Nagar, Ajmer. 85 Goa E–Wing, Osia Commercial Arcade, SGPDA Market Complex, Margao, Goa. 86 Vadodara Reliance Mega Mall, 3rd Floor, Old Padra Road, Vadodara.87 New Delhi Behind Shadipur Metro Station Patel Nagar, New Delhi.88 New Delhi District Centre, Janak Place, New Delhi. 89 New Delhi 45, District Centre, Near Intercontinental Hotel, Nehru Place, New Delhi.90 Indore C-21 Mall, PU - 4, Scheme No. 54 AB Road, Indore. 91 Jodhpur Ansal Royal Plaza Nr- Stadium, High Court Road,Jodhpur, Rajasthan.92 Aurangabad Prozone Mall, API Corner, P-80 Chikalthana Industrial Area, Aurangabad.93 Rohtak Sky Mall, Sonipat Road, Huda Sector-3, Rohtak.94 Mysuru Mall of Mysore, Plot No. C1, Third Floor, Nazarbad Mohalla, MG Road, Mysuru.95 Amritsar Trilium Mall, 5th Floor, Plot C-4 Circular Road, Opp. Basant Avenue, Amritsar. 96 Bhilwara 3rd Floor, City Centre Mall, Near Mahaveer Park, Bhopalganj, Bhilwara. 97 Rajkot Old Dharam Cinema Building, Kasturba Road, Rajkot. 98 Gandhinagar R World, Jamiyatpura Mehsana Highway, Adalaj, Gandhinagar. 99 Gandhinagar Old Rajshree Cinema, 2nd Floor, R-21, Sector 21, Gandhinagar. 100 Bhiwadi Genesis Mall, Alwar Bhiwadi Highway, Bhiwadi.101 Mumbai R City Mall, Lal Bahadur Shastri Marg, Ghatkopar (West), Mumbai.102 Goa 2nd Floor, A- Wing, Osia Commercial Arcade, SGPDA Market Complex, Margao.103 Meerut PVS Mall, I Bock, Shastri Nagar, Meerut.104 Thrissur Sobha City Mall, Thrissur.105 Surat Aai Mata Chowk, Paravat Patia, Surat. 106 Jorhat ABS Mall, 4th Floor, at Rd, Gar-Ali, Jorhat. 107 Goa Mall De Goa, Alto Porvorim, Bardez, Goa.108 Bengaluru# BrookefieldMall,KundalahalliVillage,KrishnarajapuranHobli,Bengaluru.

* Two screens were opened after 31st March, 2016.# commenced operations after 31st March, 2016.


(q) Address for correspondence: Registered Office: ABS Towers, Old Padra Road, Vadodara – 390 007 Phone No.: (91 265) 6198 111 | Fax No.: (91 265) 2310312

Corporate Office: 5th Floor, Viraj Towers, Next to Andheri Flyover, Western Express Highway, Andheri (E). Mumbai - 400 093. Phone No.: 4062 6900 | Fax No.: 4062 6999 Website: www.inoxmovies.com Email Address: [email protected]

10. OTHER DISCLOSURES:

a) Materially significant Related Party Transactions: Therewere no transactionswith Related Parties during the Financial Yearwhichwere in conflictwith the interest of

the Company. Suitable disclosure as required by the Accounting Standards (AS18) has been made in the note 49 to the Standalone Financial Statements of the Company and in the Board’s Report as required under Section 134 of the Companies Act, 2013.

The Board has also approved a policy on Materiality of Related Party Transactions which also includes procedure to deal with Related Party Transactions and such Policy has been put up on the Company's Website. The same can be viewed at https://www.inoxmovies.com/Corporate.aspx?Section=3.

b) Details of Non-Compliance: During the last three years, there were no instances of Non-Compliance, Penalties, Strictures imposed on the Company by

Stock Exchange or SEBI or any statutory authority, on any matter related to Capital Markets.

c) Whistle Blower Policy: The Company has adopted Whistle Blower Policy at its Board Meeting held on 27th May, 2014 to report concerns about

unethical behaviour, actual or suspected fraud or violation of the Company’s Code of Conduct. Adequate safeguards have been provided in the Policy to prevent victimization of Directors/Employees. No personnel has been denied access to the Audit Committee.

A copy of Company’s Whistle Blower Policy has been put up on Company’s Website. The same can be viewed at https://www.inoxmovies.com/Corporate.aspx?Section=3.

d) All the Mandatory requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 have been complied by the Company.

Adoption of Non-mandatory requirement:

(i) Modified opinion(s) in Audit Report: For the Financial Year ended 31stMarch, 2016, the Independent Auditors have given unmodified opinion on the

Company’sFinancialStatements.TheCompanycontinuestoadoptbestpracticestoensuretheregimeofunmodifiedFinancial Statements.

(ii) Separate posts of Chairperson and Chief Executive Officer: The Company has appointed Mr. Pavan Jain as a Chairman of the Company while Mr. Alok Tandon is the Chief

ExecutiveOfficeroftheCompany.

e) The Company has formulated a Policy for determining ‘Material’ subsidiaries and such policy has been disclosed on the Company's Website. The same can be viewed at https://www.inoxmovies.com/Corporate.aspx?Section=3.

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f) Disclosure of commodity price risks and commodity hedging activities: Not applicable

g) Disclosure about Directors being appointed / re-appointed: The brief Resume and other information required to be disclosed under this section is provided in the Notice of the Annual

General Meeting.

h) TheCompanyhascompliedwiththeCorporateGovernancerequirementsspecifiedinRegulations17to27andClause(b)to (i) of Sub-Regulation 46 of the Listing Regulations.

i) Management Discussion and Analysis Report: Management Discussion and Analysis Report is set out in the Annual Report in compliance with Clause B of Schedule V to

the Listing Regulations.

j) CEO/CFO Certification: TheCompanyhasobtainedaCertificatefromChiefExecutiveOfficerandChiefFinanceOfficerinrespectofmattersstated

in Regulation 17 (8) of Listing Regulations.

11. DECLARATION BY CHIEF EXECUTIVE OFFICER:

DeclarationsignedbyMr.AlokTandon,ChiefExecutiveOfficeroftheCompany,statingthattheBoardofDirectorsandSeniorManagementPersonnelhaveaffirmedcompliancewiththeCodeofConductofBoardofDirectorsandSeniorManagementisannexed to this Report at Annexure – A.

12. COMPLIANCE CERTIFICATE FROM THE AUDITORS CERTIFICATE:

Asstipulated inParaEofScheduleVofListingRegulations, theCertificate fromthe independentauditorsof theCompanyregarding compliance of conditions of corporate governance is annexed with the Board’s report.

13. CODE OF CONDUCT:

Company’s Board has laid down a Code of Conduct for all Board Members and senior management of the Company which was amended at its meeting held on 20th October, 2014 by including duties of Independent Directors. All Board Members and senior managementpersonnelhaveaffirmedcompliancewiththeCodeofConduct.TheCodeofConductisplacedontheWebsiteofthe Company at https://www.inoxmovies.com/Corporate.aspx?Section=3.

By Order of the Board of Directors

Place: Mumbai Pavan Jain Date: 8th August, 2016 Chairman

ANNEXURE – A

Declaration by the CEO under Clause D of Schedule V of the Listing Regulations:

I,AlokTandon,ChiefExecutiveOfficerofINOX Leisure Limited, declare that all the Board Members and Senior Management Personnel have affirmed compliancewith theCode ofConduct for the Board and SeniorManagement Personnel, for theFinancial Year ended 31st March, 2016.

Place: Mumbai Alok TandonDate: 11th July, 2016 Chief Executive Officer

Independent Auditor’s Reportto the members of INOX Leisure Limited

Report on the Standalone Financial StatementsWe have audited the accompanying standalone financial statements of INOX Leisure Limited (“the Company”), which comprise the Standalone Balance Sheet as at 31st March 2016, the Standalone Statement of Profit and Loss and the Standalone Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management’s Responsibility for the Standalone Financial StatementsThe Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. 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 statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s ResponsibilityOur responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on these standalone financial statements.

OpinionIn our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March 2016 and its profit and cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2016 issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure I a statement on the matters specified in paragraph 3 and 4 of the said Order.

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2. As required by Section 143 (3) of the Act, we report 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, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

(e) On the basis of the written representations received from the directors as on 31st March, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2016 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 II.

(g) 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, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements – refer note no. 37 to the standalone financial statements;

ii. The Company did not have any long term contracts including derivative contracts, for which there were any material foreseeable losses; and

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

For Patankar & AssociatesChartered Accountants

Firm’s Registration No. 107628W

S S AgrawalPlace: Pune PartnerDate: 27th April 2016 Membership No. 049051


Annexure to Independent Auditor’s Reportto the members of INOX Leisure Limited

Annexure I to Independent Auditor’s Report to the members of INOX Leisure Limited on the standalone financial statements for the year ended 31st March 2016 – referred to in paragraph 1 under the heading “Report on Other Legal and Regulatory Requirements” of our report of even date.

In term of the Companies (Auditor’s Report) Order, 2016 (“the Order”), on the basis of information and explanation given to us and the books and records examined by us in the normal course of audit and such checks as we considered appropriate, to the best of our knowledge and belief, we state as under:

1. The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. The fixed assets have been physically verified by the management at reasonable intervals and no material discrepancies have been noticed on such verification. The title deeds of all immovable properties are held in the name of the Company, except as under:

Particulars No. of cases Gross block Net block RemarksLeasehold land 1 181.45 144.09 In the name of erstwhile amalgamated company and yet to

be transferred in the name of the CompanyBuilding 2 7,029.26 5,951.03 Conveyance deed is yet to be executed

1 828.57 677.98 In the name of erstwhile amalgamated company and yet to be transferred in the name of the Company

1 1,763.73 1,515.88 In the name of erstwhile amalgamated company and conveyance deed is yet to be executed

Building total 9,621.56 8,144.89

2. The inventories were physically verified by the management at reasonable intervals during the year and no material discrepancies were noticed on physical verification of inventories as compared to book records.

3. The Company has not granted any loan, 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, except for one such company which is now amalgamated with the Company w.e.f. 8th August 2014 (see note no. 30 and 50 in the standalone financial statements). The terms and conditions of the said loan were not, prima facie, prejudicial to the interest of the Company. The said company was regular in repayment of principal and payment of interest, as stipulated, and there are no overdue amounts.

4. The Company has complied with the provisions of Section 185 and section 186 of the Act in respect of investments made or loans given or guarantee or security provided.

5. The Company has not accepted any deposits within the meaning of section 73 to 76 of the Companies Act, 2013 and the Rules framed thereunder and hence the provisions of clause 3(v) of the Order are not applicable to the Company.

6. The Central Government has not prescribed maintenance of cost records under section 148(1) of the Companies Act, 2013 for the activities of the Company and hence the provisions of clause 3(vi) of the Order are not applicable to the Company.

7. The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees’ state insurance, income-tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess, entertainment tax and other material statutory dues applicable to it. There are no undisputed amounts payable in respect of such statutory dues which were in arrears as at 31st March 2016 for a period of more than six months from the date they become payable.

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Particulars of dues of income-tax, service tax, duty of customs and value added tax which have not been deposited on account of disputes are as under:

Name of the Statute Nature of dues and the period to which the amount relates

Amount (` in Lakh)

Forum where dispute is pending

Service-tax (Finance Act, 1994)

Service tax on renting of immovable properties for the period August 2008 to September 2011

1,042.44 Supreme Court of India

Service tax on film distributors’ payments for the period May 2009 to June 2012

571.90 Central Excise and Service Tax Appellate Tribunal, Hyderabad. The Company is in the process of filing the appeal.

Service tax on film distributors’ payments for the period May 2008 to March 2014

2,853.23 Central Excise and Service Tax Appellate Tribunal, New Delhi.

Customs Act, 1962 Custom duty Amount not ascertainable

Commissioner Appeal, Central Board of Excise and Customs

Custom duty for the period 2005-06 4.36 Asst. Commissioner of Customs, Jawaharlal Nehru Custom House, JNPT, Nhava Sheva

Maharashtra Value Added Tax Act, 2002

Assessment dues for the year 2008-09 235.06 Deputy Commissioner of Sales Tax (Appeals – 4), Mazgaon, Mumbai

Income Tax Act, 1961 Penalty u/s 271(1)(c) for the year 2009-10 19.48 Commissioner of Income-tax (Appeals) - VadodaraAssessment dues for the year 2012-13 216.16

There are no dues of sales tax or duty of excise which have not be deposited on account of disputes.

8. The Company has not defaulted in repayment of loans and borrowings to financial institutions or banks and the Company did not have any borrowings from Government or by way of debentures.

9. The Company has applied the moneys raised by way of term loans for the purpose for which these loans were raised. The Company did not raise moneys by way of initial public offer or further public offer (including debt instruments).

10. During the year, the Company has detected a fraud perpetrated by an employee of the Company in respect of travelling expenses and the amount involved, as assessed by the Company is ` 418.30 Lakh, as detailed in note no. 41 to the financial statements. No fraud by the Company or fraud on the Company by its officers has been noticed or reported during the course of our audit.

11. The Company has not paid any managerial remuneration and hence the provisions of clause 3(xi) of the Order are not applicable to the Company.

12. The Company is not a Nidhi Company and hence the provisions of clause 3(xii) of the Order are not applicable to the Company.

13. All transactions with the related parties are in compliance with sections 177 and 188 of Companies Act, 2013 and the details have been disclosed in the standalone financial statements etc. as required by the applicable accounting standards.

14. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year and hence the provisions of clause 3(xiv) of the Order are not applicable to the Company.

15. The Company has not entered into any non-cash transactions with directors or persons connected with them and hence the provisions of clause 3(xv) of the Order are not applicable to the Company.

16. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934 and hence the provisions of clause 3(xvi) of the Order are not applicable to the Company.






Annexure II to Independent Auditor’s Report to the members of INOX Leisure Limited on the standalone financial statements for the year ended 31st March 2016 – referred to in paragraph 2(f) under the heading “Report on Other Legal and Regulatory Requirements” of our report of even date.

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)We have audited the internal financial controls with reference to financial statements over financial reporting of INOX Leisure Limited (“the Company”) as of 31st March 2016 in conjunction with our audit of the standalone 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 (the “Guidance Note”) issued by the Institute of Chartered Accountants of India (“ICAI”). 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 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 (“the Act”).

Auditor’s ResponsibilityOur responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. 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 performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference to financial statements 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 with reference to financial statements 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 reporting 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 ReportingBecause 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,

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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, the Company has, in all material respects, an adequate internal financial control system with reference to financial statements system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March 2016, 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 ICAI.




Standalone Balance Sheetas at 31st March 2016

(` in Lakh)

Particulars Note No.

As at 31st Mar 2016

As at 31st Mar 2015

I EQUITY AND LIABILITIES 1 Shareholders’ Funds

(a) Share Capital 4 9,616.28 9,616.28 (b) Reserves and surplus 5 52,761.02 61,741.75 (c) Interest in INOX Benefit Trust (at cost) 31 (3,266.98) (3,266.98)

59,110.32 68,091.05 2 Non-Current Liabilities

(a) Long-term borrowings 6 21,693.00 20,050.56 (b) Deferred tax liabilities (net) 7 585.84 2,308.87 (c) Other long term liabilities 8 235.37 415.23 (d) Long-term provisions 9 777.96 541.17

23,292.17 23,315.83 3 Current Liabilities

(a) Short term borrowings 10 2,512.65 1,410.06 (b) Trade payables (i) Dues to Micro and Small Enterprises 11 5.39 1.80 (ii) Dues to others 11 7,273.53 6,686.69 (c) Other current liabilities 12 8,852.04 9,810.52 (d) Short-term provisions 9 1,642.89 1,490.82

20,286.50 19,399.89 TOTAL 102,688.99 110,806.77

II ASSETS 1 Non-Current Assets

(a) Fixed assets (i) Tangible assets 13 61,990.89 55,973.81 (ii) Intangible assets 13 2,870.82 317.25 (iii)Capital work-in-progress 14 5,572.83 5,027.43

70,434.54 61,318.49 (b) Non-current investments 15 250.53 18,884.99 (c) Long term loans and advances 16 19,277.50 16,352.86 (d) Other non-current assets 17 1,281.00 349.89

91,243.57 96,906.23 2 Current Assets

(a) Current investments 15 1,508.50 641.37 (b) Inventories 18 684.87 689.43 (c) Trade receivables 19 5,349.82 5,652.64 (d) Cash and bank balances 20 2,688.50 1,217.64 (e) Short-term loans and advances 21 1,066.96 5,524.38 (f) Other current assets 22 146.77 175.08

11,445.42 13,900.54 TOTAL 102,688.99 110,806.77

The accompanying notes are an integral part of the financial statements.As per our report of even date attached For INOX Leisure LimitedFor Patankar & Associates Chartered Accountants

S. S. Agrawal Siddharth Jain Deepak Asher Alok Tandon Upen ShahPartner Director Director Chief Executive Officer Chief Finance Officer

Dhanraj Mulki Company Secretary & Vice President Legal

Place: Pune Place: Mumbai Date: 27th April, 2016 Date: 27th April, 2016

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Standalone Statement of Profit and Lossfor the year ended 31st March 2016

(` in Lakh)


Year ended31st Mar 2016


REVENUE Revenue from operations 23 133,268.58 95,368.59 Other income 24 432.44 1,104.55 Total revenue 133,701.02 96,473.14

EXPENSES Entertainment tax 17,380.94 11,396.39 Exhibition cost 25 32,529.99 23,090.18 Cost of food and beverages 26 6,610.70 4,609.50 Employee benefits expense 27 7,466.12 6,025.21 Finance costs 28 2,433.74 3,842.99 Depreciation & amortization expense 13 8,028.76 7,146.09 Other expenses 29 50,282.27 38,176.74 Total expenses 124,732.52 94,287.10

Profit before exceptional items and taxes 8,968.50 2,186.04 Less: Exceptional items 33 496.02 50.52 Profit before tax 8,472.48 2,135.52 Tax expenses

Current tax 36(a) 3,457.00 839.00 Deferred tax (360.63) (327.43) Taxation pertaining to earlier years 36(b) (2,388.33) (852.51)

708.04 (340.94)

Profit for the year 7,764.44 2,476.46

Earnings per equity share of ` 10 each (`) 55 Basic 8.46 2.70 Diluted 8.46 2.70 The accompanying notes are an integral part of the financial statements.

As per our report of even date attached For INOX Leisure LimitedFor Patankar & Associates Chartered Accountants




Standalone Cash Flow Statementfor the year ended 31st March 2016

(` in Lakh) Particulars Year ended

31st Mar 2016Year ended

31st Mar 2015

A Cash flow from operating activitiesProfit before tax 8,472.48 2,135.52 Adjustments for :Depreciation and amortization expense 8,028.76 7,146.09 Loss on retirement/disposal of fixed assets (net) 326.66 4.10 Provision for diminution in value of assets held for disposal 14.98 17.03 Bad debts and remissions 118.05 - Deposits and advances written off 211.85 40.57 Provision for doubtful debts 175.77 23.06 Provision for doubtful advances and deposits 120.58 311.88 Liabilities and provisions, no longer required, written back (121.33) (219.99)Provision for diminution in value of investment written back - (9.48)Amortization of value of stock options - 1.36 Interest income (143.52) (499.28)Gain on sale of current investments (143.06) (376.57)Finance costs 2,433.74 3,842.99 Operating profit before working capital changes 19,494.96 12,417.28

Changes in working capitalTrade payables 228.02 525.27 Long-term provisions 164.56 127.74 Short-term provisions 20.05 13.11 Other current liabilities 50.30 44.42 Other long term liabilities 60.03 94.87 Trade receivables 641.19 (2,333.87)Inventories 74.24 169.51 Long-term loans and advances (2,280.44) (2,169.81)Short-term loans and advances (10.58) 331.93 Cash generated from operations 18,442.33 9,220.45 Direct taxes paid (net) (1,515.36) (734.64)Net cash generated from operating activities 16,926.97 8,485.81

B Cash flow from investing activitiesPurchase of fixed assets (including change in Capitalwork-in-progress, capital advances and pre-operative expenses) (12,249.20) (9,020.27)Sale of fixed assets 11.44 92.43 Acquisition of intangible assets (2,701.78) (112.88)Investment in subsidiary companies (125.00) (18,390.38)Payment towards share purchase consideration payable (61.30) - Share application money paid to joint venture/received back - 15.00 Purchase of other non-current investments (22.53) (14.20)Sale/redemption of other non-current investments 13.38 16.11 Purchase of current investments (14,162.00) (29,988.50)Sale/redemption of current investments 13,405.95 30,018.05 Proceeds from sale of treasury shares - see note no. 31 - 27,033.18 Inter-corporate deposit given - (4,580.11)Movement in bank fixed deposits with original maturity ofmore than 3 months (net) (50.27) (237.26)Interest received 136.65 474.46 Net cash used in investing activities (15,804.66) (4,694.37)

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Standalone Cash Flow Statementfor the year ended 31st March 2016


31st Mar 2016Year ended

31st Mar 2015

C Cash flow from financing activitiesShares issued under ESOP - 2.49 Repayment of Inter-corporate deposit - (1,100.00)Proceeds from long term loans 4,141.00 2,618.00 Repayment of long term loans (2,598.56) (2,198.56)Proceeds from short term borrowings (net) 1,102.59 522.37 Finance costs (2,460.95) (4,199.83)Net cash generated from / (used in) financing activities 184.08 (4,355.53)

Net increase / (decrease) in cash and cash equivalents 1,306.39 (564.09)

Cash and cash equivalents at the beginning of the year 893.24 1,457.33 Add: On amalgamation (see note no. 30) 43.35 -

936.59 1,457.33 Cash and cash equivalents at the end of the year 2,242.98 893.24

Notes: 1 The above Cash Flow Statement has been prepared and presented under the ‘Indirect Method’.2 The amalgamation of erstwhile Satyam Cineplexes Limited (Refer Note 30) with the Company is a non cash transaction.3 Components of cash and cash equivalents are as per note no. 20.4 The accompanying notes are an integral part of the financial statements.





1. CORPORATE INFORMATION INOX Leisure Limited (the “Company”) is engaged in the business of operating & managing multiplexes and cinema theatres

in India. The Company is a public company and its shares are listed on the Bombay Stock Exchange and the National Stock Exchange of India. The Company is a subsidiary of Gujarat Fluorochemicals Limited.

2. BASIS OF PREPARATION These financial statements have been prepared in accordance with the generally accepted accounting principles in India,

under the historical cost convention and on accrual basis. These financial statements comply in all material respects with the applicable accounting standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014.

Figures for the previous year have been re-grouped / reclassified wherever necessary to confirm with the classification of the current year. In view of amalgamation of erstwhile Satyam Cineplex Limited (see note no. 30), figures for the current year are after giving effect to the amalgamation and hence not directly comparable with those of previous year.

3. SIGNIFICANT ACCOUNTING POLICIES a) Revenue Recognition: Revenue from Box Office is recognized as and when the movie is exhibited. Revenue from Sale of Food & Beverages is

accounted at the point of sale. These revenues are net of refunds and complimentary. Conducting fees are in respect of charges received from parties to conduct business from the Company’s Multiplexes and the revenue is recognized as per the contractual arrangements. Advertisement income is recognized on exhibition of the advertisement or over the period of contract, as applicable. Income from sale of power is recognized on the basis of actual units generated and transmitted to the purchaser. Dividend income is recognised when the unconditional right to receive payment is established. Income from interest on deposits, loans and interest-bearing securities is recognised on time proportion basis.

b) Fixed Assets: Fixed assets are carried at cost, as reduced by accumulated depreciation/amortization, except freehold land, which

is carried at cost. Cost comprises of purchase price / cost of construction, including non-refundable taxes or levies, and any expenses attributable to bring the assets to its working condition for its intended use. Project pre-operative expenses and expenditure incurred during construction period of multiplexes are capitalized to various eligible assets in respective multiplexes. Borrowing costs directly attributable to acquisition or construction of qualifying fixed assets are capitalised. In respect of accounting period commencing on or after 1 April 2011, consequent to the amendment of para 46A of AS 11: The Effects of Changes in Foreign Exchange Rates, cost of depreciable capital assets include foreign exchange differences arising on translation of long term foreign currency monetary items. Fixed assets retired from active use and held for sale are stated at the lower of their net book value and net realisable value and are disclosed separately under current assets.

c) Depreciation and amortization: On tangible assets - cost of leasehold land is amortized over the period of lease. On other fixed assets, excluding

freehold land, depreciation is provided on straight-line basis as under:

I. On leasehold improvements, electrical installations & air conditioners in leased premises, over the period of useful life on the basis of the respective agreements or the useful life as per Schedule II part C of the Companies Act, 2013, whichever is shorter.

II. On other fixed assets, on the basis of useful life as per Schedule II part C of the Companies Act, 2013

On intangible assets - cost of software is amortized over a period of three years in case of operating software and six years in case of other software. Cost of goodwill and movie script acquired and cost of web-site developed is amortized over a period of five year.

d) Impairment of assets: Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the

carrying amount of the Company’s asset. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount.

Notes to the standalonefinancial statements for the year ended 31st March 2016

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Annual Report 1516

e) Investments: Long-term investments are carried at cost. Provision for diminution is made to recognize the decline, other than

temporary, in the values of these investments. Current investments are carried at lower of the cost and fair value.

f) Inventories: Inventories are valued at lower of the cost and net realisable value. Cost is determined using first-in-first-out (FIFO)

method.

g) Employee Benefits: Short-term employee benefits are recognized as an expense at the undiscounted amount in the statement of profit and

loss in the year in which related services are rendered. Company’s contribution towards Defined Contribution Plan viz. Government administered provident fund and pension schemes, paid / payable during the year are charged to the statement of profit and loss. Defined Benefit Plans in the form of Gratuity and Leave Encashment are recognized as an expense in the statement of profit and loss at the present value of the amounts payable, determined on the basis of actuarial valuation techniques, using the projected unit credit method. Actuarial gains and losses are recognized in the statement of profit and loss.

h) Taxes on Income: Income tax expense comprises of current tax and deferred tax charge. Deferred tax is recognised, subject to

consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originates in one period and are capable of reversal in one or more subsequent periods. The deferred tax in respect of timing differences which reverse during the tax holiday period is not recognised to the extent the Company's gross total income is subject to the deduction during the tax holiday period. Minimum Alternate Tax (MAT) paid on the book profits, which gives rise to future economic benefits in the form of tax credit against future income-tax liability, is recognized as an asset in the Balance Sheet if there is convincing evidence that the Company will pay normal tax within the period specified for utilization of such credit.

i) Borrowing Cost: Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the

cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to statement of profit and loss.

j) Leases: Lease rentals in respect of assets acquired on operating lease are charged-off to the statement of profit and loss as per

the terms of the respective lease agreements.

k) Foreign Currency Transactions:

(i) Transactions in foreign currency are recorded in rupees by applying the exchange rate at the date of the transaction. Gains or losses on settlement of the transactions are recognized in the statement of profit and loss. At the Balance Sheet date, monetary assets and liabilities in foreign currency are restated by applying the closing rate, and the difference arising out of such conversion is recognized in the statement of profit and loss, except as mentioned in para (ii) below.

(ii) The Central Government has vide its notification no. G.S.R. 914(E) dated 29th December, 2011, amended AS 11 ‘The Effects of Changes in Foreign Exchange Rates’, notified under the Companies (Accounting Standards) Rules, 2006, to the extent it relates to the recognition of losses or gains arising on restatement of long-term foreign currency monetary items in respect of accounting periods commencing on or after 1st April 2011. As stipulated in the Notification, the Company has exercised the option to adopt the following policy irrevocably.

Long term foreign currency monetary items are translated at the exchange rate prevailing on the balance sheet date and the net exchange gain / loss on such conversion and on settlement of the liability, is adjusted to the cost of the asset, where the long-term foreign currency monetary items relate to the acquisition of a depreciable capital asset (whether purchased within or outside India), and depreciated over the balance life of the assets.

l) Treasury Shares: Pursuant to the Scheme of Amalgamation of Fame India Limited (‘Fame’) and its subsidiaries with the Company (refer

note no. 31), equity shares of the Company have been issued to INOX Benefit Trust (the Trust) against the equity shares of Fame held by the Company. These shares are recognised as Interest in INOX Benefit Trust at the amount


of consideration paid by the Company to acquire the shares of erstwhile Fame. These shares of the Company held by INOX Benefit Trust are classified and are presented as a deduction from Shareholders’ Funds. Difference between the cost and the amount received at the time sale of shares by the Trust, is recorded separately as ‘Reserve on Sale of Treasury Shares’ under Reserve and Surplus.

m) Provisions and Contingent Liabilities: A provision is recognized when the Company has a present obligation as a result of past event and it is probable that an

outflow of resources will be required to settle the obligation and in respect of which a reliable estimate can be made. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is possible obligation or a present obligation in respect of which the likelihood of outflow of resource is remote, no provision or disclosure is made.

n) Use of Estimates: The preparation of financial statements in conformity with Indian GAAP requires the management to make judgements,

estimates and assumptions that affect the reported balances of assets and liabilities and disclosure of contingent liabilities, at the end of the accounting year and reported amounts of revenue and expenses during the year. Although these estimates are based on the management’s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.

4. SHARE CAPITAL (` in Lakh)

Particulars 31st Mar 2016 31st Mar 2015 Authorised Capital 14,60,50,000 (Previous year 14,00,50,000) equity shares of ` 10/- each 14,605.00 14,005.00 10,000 preference shares of Rs 10/- each 1.00 1.00

14,606.00 14,006.00 For increase in Authorised Capital pursuant to scheme of amalgamation - see note no. 30 Issued, subscribed and fully paid up shares 9,64,57,754 equity shares of ` 10/- each 9,645.78 9,645.78 Less: 2,95,001 Equity Shares of ` 10/- each, issued to ESOP Trust but not allotted to employees (see note no. 35) 29.50 29.50 Adjusted Issued, subscribed and paid-up Capital 9,616.28 9,616.28

a) Reconciliation of the equity shares outstanding at the beginning and at the end of the reporting period(` in Lakh)

Particulars 31st Mar 2016 31st Mar 2015 Nos. Amount Nos. Amount

At the beginning of the year 96,162,753 9,616.28 96,146,174 9,614.62 Add: Issued during the year under ESOP - - 16,579 1.66

96,162,753 9,616.28 96,162,753 9,616.28 Less: Interest in INOX Benefit Trust - shares of Company held by the Trust (see note no. 31) 4,350,092 435.01 4,350,092 435.01

91,812,661 9,181.27 91,812,661 9,181.27

b) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of `10 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to approval of the shareholders in the Annual General Meeting. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive the remaining assets of the Company, in proportion to their shareholding.


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Annual Report 1516

c) Equity shares held by holding / ultimate holding company (` in Lakh)


Gujarat Fluorochemicals Limited (holding company) 46,386,467 4,638.65 46,386,467 4,638.65 INOX Leasing & Finance Limited (ultimate holding company) 587,461 58.75 587,461 58.75

The shareholders of the Company have passed a resolution at the Annual General Meeting held on 23rd August 2013 amending the Articles of Association of the Company entitling Gujarat Fluorochemicals Limited (GFL) to appoint majority of directors on the Board of the Company if GFL holds not less than 40% of the paid-up equity capital of the Company and accordingly, the Company is a subsidiary of GFL.

d) Shares issued for consideration other than cash during the period of five years immediately preceding the reporting date:

During the year ended 31st March 2014, 3,45,62,206 shares of ` 10 each, fully paid-up, were issued to the shareholders of erstwhile Fame India Limited, pursuant to the Scheme of Amalgamation.

e) Details of shareholders holding more than 5% equity shares in the Company (` in Lakh)

Particulars 31st Mar 2016 31st Mar 2015 Nos. % Nos. %

Gujarat Fluorochemicals Limited 46,386,467 48.09% 46,386,467 48.09%

f) Shares reserved for issue under options For details of shares reserved for issue under the employee stock option (ESOP) plan of the Company, see note no. 35.

5. RESERVES & SURPLUS(` in Lakh)

Particulars 31st Mar 2016 31st Mar 2015Capital redemption reserveBalance as per last Balance Sheet 0.10 0.10 Securities Premium AccountBalance as per last Balance Sheet 25,766.91 25,766.91 Add: Addition on amalgamation (see note no. 30) 2,340.45 - Balance as at the end of the year 28,107.36 25,766.91 Less: Premium on shares issued to ESOP Trust but not allotted to employees 14.75 14.75 Net balance at the end of the year 28,092.61 25,752.16 Employee Stock Options OutstandingBalance as per last Balance Sheet - 6.32 Less: On account of options granted/lapsed/exercised and amortisation of value of stock options (net) - (6.32)Balance as at the end of the year - - Amalgamation ReserveBalance as per last Balance Sheet 750.66 750.66 Less: Deduction on account of amalgamation (see note no. 30) (750.66) - Balance as at the end of the year - 750.66 General ReserveBalance as per last Balance Sheet 5,400.00 5,400.00 Add: Addition on amalgamation (see note no. 30) 100.00 -Less: Deduction on account of amalgamation (see note no. 30) (2,717.45) - Balance as at the end of the year 2,782.55 5,400.00


(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Other ReserveReserve on sale of Treasury Shares (see note no. 31)Balance as per last Balance Sheet 14,872.93 (458.34)Profit on sale of treasury shares during the year - 15,331.27 Less: Deduction on account of amalgamation (see note no. 30) (14,872.93) - Balance as at the end of the year - 14,872.93 Surplus in the Statement of Profit and Loss Surplus as per last Balance Sheet 14,965.92 13,002.00 Less : Adjustment on account of carrying amount of fixed assets as at 1st April 2014 (see note no. 34)

- (512.56)

Less: On account of amalgamation (see note no. 30) (844.60)Add: Profit for the year 7,764.44 2,476.46 Balance as at the end of the year 21,885.76 14,965.90 Total 52,761.02 61,741.75

6. LONG-TERM BORROWINGS

(` in Lakh)31st Mar 2016 31st Mar 2015

Term loans from banks (secured) 7,942.56 6,400.12 Loans & advances from related parties (unsecured) - see note no. 49Inter-corporate deposits - from holding company 16,249.00 16,249.00 Total borrowings 24,191.56 22,649.12 Less: Current maturities disclosed under the note no. 12 "Other current liabilities" (2,498.56) (2,598.56)Total 21,693.00 20,050.56

Nature of Security and terms of repayment for secured borrowings: a) Term loans from Axis Bank amounting to ` 3,942.56 Lakh (previous year ` 6,400.11 Lakh) carry interest @ bank base rate

+ 0.25 % p.a. which presently is 9.70%. The loans are secured by mortgage of immovable property situated at Vadodara and Anand and first exclusive charge on all movable fixed assets and current assets of the new multiplexes/property financed by the said term loans and escrow of entire cash flows relating to such multiplexes. The repayment schedules are as under:

Particulars OutstandingAmount (` in Lakh)

Repayment terms

Term Loan 1 1,498.56 Repayable in 16 equal quarterly instalments of ` 374.64 Lakh each beginning from 30th June 2013

Term Loan 2 2,444.00 Repayable in 16 equal quarterly instalments of ` 250.00 Lakh each beginning from 1st October 2014

b) Term loans from HDFC Bank amounting to ` 4,000.00 Lakh (previous year ` Nil) carry interest @ bank base rate which presently is 9.30% and is secured by mortgage of immovable property situated at Mumbai and first exclusive charge on all movable fixed assets of the new multiplexes/property financed by the said term loan. The loan is repayable in 16 equal quarterly instalments beginning from 30th June, 2017.


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Annual Report 1516

Terms of repayment for unsecured borrowings: The inter-corporate deposits are repayable in 6 to 8 years from the date of respective deposits and carry interest @ 10%.

7. DEFERRED TAX LIABILITIES (NET)

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015 Deferred tax liabilities On account of difference between book and tax depreciation 1,473.96 3,047.09 Total liabilities 1,473.96 3,047.09 Deferred tax assets Expenditure allowable on payment basis under Income-tax Act, 1961 765.46 661.72 Amalgamation expenses 35.38 50.53 Provision for doubtful debts and advances 87.28 25.97 Total assets 888.12 738.22 Net deferred tax liabilities 585.84 2,308.87

8. OTHER LONG-TERM LIABILITIES

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Security deposits received 159.17 111.98 Retention money 76.20 45.70 Creditors for capital expenditure - 257.55 Total 235.37 415.23

9. PROVISIONS(` in Lakh)

Particulars Long-term Short-term31st Mar 2016 31st Mar 2015 31st Mar 2016 31st Mar 2015

For employee benefits (see note no. 48)Gratuity 565.26 388.27 67.93 66.94Leave benefits 212.70 152.90 87.66 73.86For expenses (see note no. 51)Municipal tax - - 235.80 183.00MVAT - - - 39.38Service tax - - 1,042.44 1042.44For Taxation (net of payments) - - 209.06 85.20Total 777.96 541.17 1,642.89 1490.82

10. SHORT TERMS BORROWINGS

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Loans repayable on demand from banks (secured) - Bank overdraft 2,512.65 1,410.06 Total 2,512.65 1,410.06


a) Bank overdraft is secured against first charge on the entire current assets of the Company, both present and future; and extension of first charge by way of mortgage of property at Vadodara and Anand, Gujarat.

b) The Company had raised short term funds by issue of Commercial Papers (CP). Discount on CP varied between 7.55% to 8.05% and maximum balance outstanding during the year was ` 3,000 Lakh (previous year ` 32,000 Lakh).

11. TRADE PAYABLES

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015 Trade payables - Dues to Micro and Small Enterprises (see note no. 53) 5.39 1.80 - Dues to others 7,273.53 6,686.69 Total 7,278.92 6,688.49

12. OTHER CURRENT LIABILITIES

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Current maturities of long-term debt (from note no. 6) 2,498.56 2,598.56 Interest accrued and due on borrowings 38.48 65.70 Interest accrued but not due on long term liabilities 2.61 4.40 Income received in advance 762.21 681.85 Unclaimed dividend (see note below) - 2.15 Advances from customers 543.54 518.57 Statutory dues and taxes payable 1,296.61 807.54 Creditors for capital expenditure 1,449.82 3,205.31 Payable towards purchase of shares of erstwhile Satyam Cineplexes Ltd. 363.92 425.22 Retention money 310.25 246.75 Security deposits 163.54 198.99 Dues to employees 351.44 528.19 Other payables 1,071.06 527.29 Total 8,852.04 9,810.52

Note: In respect of amounts mentioned under unclaimed dividends, the actual amount to be transferred to the Investor Education and Protection Fund shall be determined on the due date.


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Annual Report 1516

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34


14. CAPITAL WORK-IN-PROGRESS

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Capital work-in-progress 4,358.73 3,911.50 Pre-operative expenditure pending allocation 1,214.10 1,115.93 Total 5,572.83 5,027.43

Pre-operative expenditure pending allocation Opening Balance 1,115.93 757.37 Add: On Amalgamation 80.24 -

1,196.17 757.37 Add: Expenses incurred during the year Salaries and wages 397.00 295.92 Contribution to Provident and other funds 19.67 17.42 Staff Welfare 5.65 3.37 Legal & Professional fees and expenses 192.59 387.18 Travelling & Conveyance 265.44 353.22 Insurance (net) 1.53 1.42 Power & Fuel 14.56 44.55 Communication Expenses 3.67 5.25 House keeping expenses 0.11 6.94 Outsourced Personnel Cost 8.38 24.49 Security expenses 81.84 69.12 Miscellaneous Expenses 29.27 71.27 Borrowings costs 8.76 123.99

1,028.47 1,404.14 Less: Pre-operative Income earned during the year Miscellaneous Income 2.40 12.15

2,222.24 2,149.36 Less: Capitalised/reclassified during the year 1,008.14 1,033.43 Closing balance 1,214.10 1,115.93

15. (a) NON-CURRENT INVESTMENTS (At cost and unquoted)

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015a) Investment in subsidiaries (trade investment)

(in fully paid up equity shares of ` 10 each)Nil (previous year 45,95,533) equity shares of Satyam Cineplexes Limited - Amalgamated during the year - see note no. 30

- 18,800.59

14,00,000 (previous year 1,50,000) equity shares of Shouri Properties Private Limited

140.00 15.00

b) Investments in joint venture (trade investment)10,15,000 equity shares of Swanston Multiplex Cinemas Private Limited 279.52 279.52 Less: Provision for diminution in value of investment (279.52) (279.52)

- -


109

Annual Report 1516

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015c) Investments in government securities (non-trade investment)

National Savings Certificates 118.03 108.88 (Pledged with Government authorities and held in the name of directors/ex-director/employees )Less: Current portion disclosed in note no. 15(b) (7.50) (39.48)

110.53 69.40

Total 250.53 18,884.99

15. (b) CURRENT INVESTMENTS (At cost and unquoted)a) Investment in mutual funds (Non-trade, unquoted, at lower of cost and fair value)

Particulars Face Value `

Nos. As at 31st Mar

2016

Nos. As at 31st Mar

2015

31st Mar 2016

31st Mar 2015

Taurus Liquid Fund-Regular Plan-Super Inst Growth

1,000 15,320 39,945 250.00 601.89

HDFC Liquid Fund-Growth 1,000 8,414 - 250.00 - Birla Sun Life Cash Plus-Growth-Regular Plan 100 414,681 - 1,001.00 -

1,501.00 601.89 b) Current portion of non-current Investment -

from note no. 15(a) 7.50 39.48

1,508.50 641.37

16. LONG-TERM LOANS AND ADVANCES (unsecured, considered good, unless otherwise stated)

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Capital advances 65.30 55.03 Security deposits - Considered good 11,693.99 9,171.52 - Considered doubtful 311.88 311.88

12,005.87 9,483.40 Advances recoverable in cash or in kind - Considered good 993.14 565.18 - Considered doubtful 84.77 -

1,077.91 565.18 Entertainment Tax refund claimed 3,335.01 2,920.81 Income Tax paid (net of provision) 228.79 294.27 MAT credit entitlement 2,571.44 2,956.22 Electricity charges refund claimed - see note no. 37(i) 389.83 389.83

19,674.15 16,664.74 Less: Provision for doubtful advances & deposits 396.65 311.88 Total 19,277.50 16,352.86


17. OTHER NON-CURRENT ASSETS (unsecured, considered good, unless otherwise stated)

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Non-current bank balances (from note no. 20) 150.47 173.73 Amount recoverable towards claim - see note no. 37(a) 932.44 - Interest accrued: on long term investments 21.76 12.60 on bank fixed deposits 14.61 6.40 others 161.72 157.16 Total 1,281.00 349.89

18. INVENTORIES (for basis of valuation - see note no. 3(f))

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Food & beverages 422.09 468.77 Stores, spares & fuel 262.78 220.66 Total 684.87 689.43

19. TRADE RECEIVABLES (unsecured, considered good, unless otherwise stated)

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Considered Good

Outstanding for a period exceeding six months 1,779.91 1,416.03 Others 3,569.91 4,236.61

Considered Doubtful 5,349.82 5,652.64 Outstanding for a period exceeding six months 252.18 76.42

5,602.00 5,729.06 Less: Provision for doubtful trade receivables 252.18 76.42 Total 5,349.82 5,652.64

20. CASH & BANK BALANCES(` in Lakh)

31st Mar 2016 31st Mar 2015Cash and cash equivalentsBalances with banks

In current accounts 2,012.81 702.54 Cash on hand 230.17 190.70 Total cash and cash equivalents 2,242.98 893.24 Other bank balances

in Unpaid dividend accounts - 2.15 Deposits with original maturity for more than 3 months but less than 12 months 310.59 298.61 Deposits with original maturity for more than 12 months 285.40 197.37 Total other bank balances 595.99 498.13

Total cash and bank balances 2,838.97 1,391.37

Less: Amount disclosed under note no. 17 "Other non-current assets" (150.47) (173.73)Total 2,688.50 1,217.64 Other bank balances include margin money deposits given as security as under:Deposits with original maturity for more than 3 months but less than 12 months 21.72 28.06 Deposits with original maturity for more than 12 months 285.40 197.37

307.12 225.43


111

Annual Report 1516

21. SHORT-TERM LOANS & ADVANCES (unsecured, considered good, unless otherwise stated)

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015

(a) Loans and advances to related parties (see note no. 49 & 50)Inter-corporate deposits to a subsidiary company - 4,580.11

(b) OthersPrepaid expenses 321.98 213.32 Security Deposits 31.21 20.86 Balance in cenvat credit account 26.15 20.13 Advances recoverable in cash or in kind 200.81 184.04 Advances to suppliers - Considered good 486.81 505.92 - Considered doubtful 35.81 -

522.62 505.92 Less: Provision for doubtful advances 35.81 -

486.81 505.92 Total 1,066.96 5,524.38

22. OTHER CURRENT ASSETS

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Fixed assets held for disposal 116.15 131.14 Interest accrued on bank fixed deposits 6.40 4.19 on long term investments 4.54 19.52 others 19.68 20.23 Total 146.77 175.08

23. REVENUE FROM OPERATIONS

(` in Lakh) 2015-2016 2014-2015

a) Sale of services Box office revenue 90,493.77 62,593.03 Conducting fees 1,982.51 1,689.76 Advertising income 9,101.32 7,829.15 Management fees 254.44 205.58 Parking charges 129.26 126.88

101,961.30 72,444.40 b) Sale of products

Food & beverages 26,563.14 17,868.56 Sale of power 6.20 6.81

26,569.34 17,875.37 c) Refund of entertainment tax for earlier years (see note no. 38(b)) - 616.74 d) Other operating revenue 4,737.94 4,432.08

Total 133,268.58 95,368.59


24. OTHER INCOME

(` in Lakh) Particulars 2015-2016 2014-2015 Interest On bank fixed deposits 47.43 44.63 On long-term investments 10.66 10.85 On income-tax refunds 35.12 27.89 On Inter-corporate deposits 5.29 337.40 Other interest 45.02 78.51

143.52 499.28 Gain on sale of current investments 143.06 376.57 Liabilities and provisions, no longer required, written back 121.33 219.99 Bad debts/deposits written off recovered 18.00 8.43 Miscellaneous income 6.53 0.28 Total 432.44 1,104.55

25. EXHIBITION COST

(` in Lakh) Particulars 2015-2016 2014-2015 Distributors' share 31,479.39 22,372.05 Other exhibition cost 964.33 666.96 Share of joint venture investors (see note below) 86.27 51.17 Total 32,529.99 23,090.18

The Company has entered into joint venture agreements for management of multiplex operations for few multiplexes / single screen theatres. These joint venture investors do not have any control over these operations.

26. COST OF FOOD AND BEVERAGES

(` in Lakh) Particulars 2015-2016 2014-2015 Opening Stock 468.77 486.71 Add: Addition on amalgamation (see note no. 30) 34.87 - Add: Purchases 6,529.15 4,591.56

7,032.79 5,078.27 Less: Closing stock 422.09 468.77 Cost of food and beverages 6,610.70 4,609.50

27. EMPLOYEE BENEFITS EXPENSE

(` in Lakh) Particulars 2015-2016 2014-2015 Salaries and wages 6,452.48 5,244.90 Contribution to provident and other funds 453.51 370.73 Expense on ESOP (net) - 1.36 Gratuity 179.97 152.02 Staff welfare expenses 380.16 256.20 Total 7,466.12 6,025.21


113

Annual Report 1516

28. FINANCE COSTS

(` in Lakh) Particulars 2015-2016 2014-2015 Interest on borrowings 2,264.58 2,362.41 Discounting charges on commercial papers 84.23 1,181.96 Interest on deferred credit 68.10 182.54 Other interest 10.11 54.80 Other borrowing costs 6.72 61.28 Total 2,433.74 3,842.99

29. OTHER EXPENSES

(` in Lakh) Particulars 2015-2016 2014-2015 Outsourced personnel cost 3,599.45 2,590.55 Power & fuel 8,623.59 6,848.65 Water charges 233.63 139.20 Property rent and conducting fees 15,859.18 12,390.67 Common facility charges 4,850.91 3,905.38 Rates & taxes 739.76 702.35 Service tax 3,824.17 2,788.62 Travelling & conveyance 619.46 562.50 Communication expenses 390.19 302.61 Printing & stationery 465.21 359.89 Advertising & sales promotion 1,190.03 932.56 House keeping expenses 2,031.15 1,495.89 Security expenses 1,937.70 1,514.37 Repairs & maintenance - buildings 429.59 183.95 Repairs & maintenance - plant and equipments 2,148.62 1,216.43 Repairs & maintenance - others 764.50 320.64 Legal & professional fees & expenses 932.07 672.33 Directors' sitting fees 15.40 14.40 Insurance 145.95 129.60 Amalgamation expenses 30.19 12.43 Loss on retirement/disposal of fixed assets (net) 183.76 4.10 Provision for diminution in value of assets held for disposal 14.98 17.03 Bad debts and remissions 118.05 - Deposits and advances written off 1.84 40.57 Provision for doubtful debts 175.77 23.06 Provision for doubtful advances and deposits 120.58 311.88 Net loss on foreign currency transactions and translation 23.60 2.35 Corporate Social Responsibility (CSR) expenditure - see note no. 52 5.00 45.31 Miscellaneous expenses 807.94 649.42 Total 50,282.27 38,176.74


30. ACQUISITION OF SATYAM CINEPLEXES LIMITED AND ITS AMALGAMATION WITH COMPANY a. During the previous year, the Company had acquired 100% of the equity shares in Satyam Cineplexes Limited (“SCL”)

and consequently SCL had become a wholly owned subsidiary of the Company with effect from 8th August, 2014. During the current year, pursuant to the Scheme of Amalgamation (“the Scheme”) under Section 391 to 394 of the Companies Act 1956, sanctioned by the Hon’ble High Court of Delhi vide order dated 10th February 2016, SCL has been amalgamated with the Company with effect from 8th August, 2014 (“the Appointed Date”). The Scheme has become effective on 23rd March 2016 viz. the date on which the certified copy of the order of the Delhi High Court sanctioning the Scheme is filed with the Registrar of Companies, Gujarat and Registrar of Companies, Delhi. The Scheme has accordingly been given effect to in the accounts. Accordingly, all the movable and immovable properties including plant and machinery, equipments, furniture, fixtures, vehicles, stocks and inventory, leasehold assets and other properties, etc. and all the debts, liabilities, duties and obligations including contingent liabilities of SCL are vested in the Company retrospectively with effect from 8th August, 2014. Since SCL was a wholly owned subsidiary of the Company, no shares were issued on its amalgamation with the Company.

b. Nature of business of the amalgamating company: SCL was engaged in the business of operating multiplex cinema theatres in India.

c. The amalgamation is accounted for under the “Pooling of Interest” method as prescribed in Accounting Standard (AS) 14 ‘Accounting for Amalgamation’, as notified under Section 133 of the Companies Act, 2013. Accordingly, the assets, liabilities and reserves of SCL as at 8th August, 2014 have been recorded at their existing carrying amounts and in the same form as at the date of amalgamation. The amount of share capital of SCL and investment held by the Company in SCL is adjusted against each other and as per the Scheme, the difference has been adjusted against the Amalgamation Reserve, Reserve on sale of Treasury Shares and General Reserve.

The effect of the Scheme as given in the accounts, in accordance with the Scheme, is summarized as under:

(` in Lakh)Particulars AssetsFixed assets (net) and capital work-in-progress 5,560.69Loans and advances and other assets 1,301.17Inventories 80.20Trade receivables 476.33Cash and bank balances 306.38Gross Assets 7,724.77LiabilitiesDeferred tax liabilities 128.78Trade payables 3,823.16Other liabilities and provisions 1,451.37Gross liabilities 5,403.31Net assets taken over 2,321.46Less: Cost of Company’s investment in SCL 18,800.59Excess of cost of Company’s investment in SCL over the net assets taken over 16,479.13Add: Reserves and surplus of SCL on the appointed date recroded at their existing carrying amountsSecurities Premium 2,340.45General Reserve 100.00Deficit in the Statement of Profit and Loss (578.54) 1,861.91Sub-total 18,341.04Adjusted against reserves of the Company as per the SchemeAmalgamation Reserve 750.66Reserve on sale of Treasury Shares 14,872.93General Reserve 2,717.45 18,341.04


115

Annual Report 1516

d. The breakup of amount of deficit in the Statement of Profit and Loss on account of amalgamation is as under:

(` in Lakh)Particulars Deficit in the Statement of Profit and Loss on the appointed date (578.54)Deficit for the period from 8th August 2014 to 31st March 2015 (453.06)Reduction in provision for taxation for the year ended 31st March 2015 consequent to the amalgamation of SCL

187.00

Net amount (844.60)

Summary of deficit for the period from 8th August 2014 to 31st March 2015 is as under:

(` in Lakh)Particulars IncomeRevenue from operations 6,347.58Other income 19.06Total income 6,366.64ExpensesEntertainment tax 748.73Exhibition cost 1,843.57Cost of food and beverages 345.41Employee benefits expense 556.36Finance costs 303.60Depreciation and amortization expense 437.55Other expenses 2,649.40Total expenses 6,884.62Loss before tax (517.98)Less: TaxationDeferred tax credit 5.18Taxation credits pertaining to earlier years 59.74Loss for the period, after tax (453.06)

e. As per the terms of the Scheme, the authorised share capital of SCL has been merged with that of the Company.

31. TREASURY SHARES Pursuant to the Composite Scheme of Amalgamation of Company’s subsidiary Fame India Limited (“Fame”) and subsidiaries

of Fame with the Company, which was operative from 1st April 2012, the Company had allotted 3,45,62,206 equity shares to the shareholders of the transferor companies on 10th July 2013, including 2,44,31,570 equity shares to INOX Benefit Trust (“Trust”) towards shares held by Company in Fame. These shares (“Treasury Shares”) are held by the Trust exclusively for the benefit of the Company.

In terms of Accounting Standard (AS 31) ‘Financial Instruments’ (which is not yet mandatory), internationally generally accepted accounting practices and for more appropriate presentation of the financial statements, the Company’s interest in the Trust (at cost), being akin to Treasury Shares, in accordance with their substance and economic reality, is deducted from Shareholders’ Fund. Any profit or loss arising from sale of Treasury Shares by the Trust is being recorded separately as ‘Reserve on sale of Treasury Shares’ under Reserves and Surplus, being transactions relating to the capital of the Company. Accordingly, during the previous year the profit of ` 15,331.27 Lakh on sale of 1,55,81,478 Treasury Shares was directly recognised in ‘Reserve on sale of Treasury Shares’ under Reserves and Surplus.

The balance equity shares 43,50,092 of the Company, held by the Trust, being Treasury Shares, are excluded while computing the Earnings Per Share.


32. ACQUISITION OF SHOURI PROPERTIES PRIVATE LIMITED During the previous year, the Company has acquired 93.75% of the equity shares in Shouri Properties Private Limited

(“SPPL”) and consequently SPPL has become a subsidiary of the Company with effect from 24 November 2014. SPPL holds a license to operate a multiplex cinema which is operated by the Company. During the current year, the Company has further subscribed to 12,50,000 equity shares of SPPL. On allotment of these shares, the Company now holds 99.29% Equity Shares of SPPL.

33. EXCEPTIONAL ITEMS:

(` in Lakh)Particulars 2015-2016 2014-2015Net value of assets written off in respect of one multiplex, the operations of which are terminated during the year

352.92 Nil

Provision for additional bonus payable in respect of earlier year pursuant to retrospective amendment made by The Payment of Bonus (Amendment) Act, 2015

143.10 Nil

Donation to an electoral trust and concerns affiliated to political parties Nil 60.00Provision for diminution in the value of investment in a joint venture - Swanston Multiplex Cinemas Private Limited, written back

Nil (9.48)

Total 496.02 50.52

34. CHANGE IN THE ESTIMATE OF USEFUL LIFE OF FIXED ASSETS DURING THE YEAR ENDED 31st MARCH 2015:

During the previous year, the Company had adopted the useful lives of various fixed assets as specified in Schedule II of the Companies Act, 2013, with effect from April 1, 2014, as against the useful lives adopted earlier as per Schedule XIV to the Companies Act, 1956. The carrying amount of fixed assets, where the remaining useful life as at 1st April 2014 as per Schedule II was Nil, aggregating to ` 512.56 Lakh (net of deferred tax credit of ` 264.00 Lakh), was recognized in the opening balance of retained earnings in the previous year.

35. EMPLOYEES’ STOCK OPTION PLANIn the year ended 31st March 2006, the Company had issued 500,000 equity shares of ` 10 each at a premium of ` 5 per share to INOX Leisure Limited – Employees’ Welfare Trust (“ESOP Trust”) to be transferred to the employees of the Company under the scheme of ESOP framed by the Company in this regard. The Company has provided finance of ` 75.00 Lakh to the ESOP Trust for subscription of these shares at the beginning of the plan.

As per the Guidance Note on Accounting for Employee Share-based Payments issued by the Institute of Chartered Accountants of India, shares allotted to the ESOP Trust but not transferred to employees is required to be reduced from Share Capital and Reserves. Out of the 500,000 equity shares allotted to the Trust, 204,999 shares have been transferred to employees. Accordingly, for the balance number of shares, the Company has reduced the Share Capital by the amount of face value of equity shares and Share Premium Account by the amount of share premium on such shares. The Company has also given effect to the above in the calculation of its Basic and Diluted earnings per share.

There are no outstanding stock options as at 31st March 2016. The compensation costs of stock options granted to employees under the Employees’ Stock Option Plan were accounted by the Company using the intrinsic value method. In accordance with the Guidance Note on Accounting for Employee Share-based Payments issued by the Institute of Chartered Accountants of India, the accounting value of options was amortized over the vesting period. Consequently, ‘Employee benefits expense’ in Note no. 27 includes ` Nil (previous year ` 1.36 Lakh) being the amortization of employee compensation. Had the Company adopted fair value method in respect of options granted, the employee compensation cost in the previous year would have been higher by ̀ 0.97 Lakh, profit before tax lower by ̀ 0.97 Lakh and the basic and diluted earnings per share would have been lower by less than Re. 0.01.


117

Annual Report 1516

36. IN RESPECT OF TAXATION MATTERSa) The Company’s contention that the amount of entertainment tax exemption availed for some of its multiplexes is a capital

receipt has been accepted by various appellate authorities and Hon’ble High Court of Judicature at Gujarat. Provision for income tax, till the year ended 31st March 2015, was made on this basis, to the extent the entertainment tax exemption is held as capital receipt for such multiplexes. The matter is presently pending before the Hon’ble Supreme Court.

b) In view of the assessment and appellate orders received by the Company, the tax liability for earlier years and the written

down value of fixed assets as per the Income-tax Act, 1961 is recomputed and consequential reduction in taxation of earlier years is recognized in the Statement of Profit and Loss as under:

(` in Lakh)Particulars 2015-2016 2014-2015Income-tax - (267.10)Deferred tax (1,486.00) -MAT Credit entitlement (902.33) (585.41)Total credit (2,388.33) (852.51)

37. CONTINGENT LIABILITIES: a. Claims against the Company not acknowledged as debt – ` 7,358.26 Lakh (previous year ` 7,235.70 Lakh), comprising

of:

i. The Company had issued termination notice for one of its proposed multiplexes seeking refund of security deposit and reimbursement of the cost of fit-outs incurred by the Company, aggregating to ` 932.44 Lakh. The party has made a counter claim of ̀ 6,943.44 Lakh (previous year ̀ 6,943.44 Lakh) towards rent for lock in period and other costs which is included in the amount above. At present the matter is pending before the Arbitrator and hence the amount of ` 932.44 Lakh is carried forward as amount recoverable towards claim in ‘Other non-current assets’.

ii. In the arbitration proceedings in respect of termination notice of MOU for another proposed multiplex, the arbitrator has awarded the matter against the Company and directed the Company to pay Rs 116.36 Lakh towards rent for the lock in period, which is included in the amount above. Further, the arbitrator has also directed the Company to pay the amount of difference between the rent payable by the Company as per the MOU and the amount of actual rent received by the other party from their new tenant. The differential amount is presently not determinable. The Company has challenged the arbitration award before the Hon’ble High Court of judicature at Delhi and the same is pending.

iii. Other claims are by owners of the multiplex premises which are under negotiations with the respective parties.

b. Property Tax matters – ` 605.08 Lakh (previous year ` 569.72 Lakh)

The Company has disputed the quantum of property tax levied in case of one multiplex and the matter is pending before Court of Small Causes and Hon’ble High Court of judicature at Bombay. Estimated provision for the same is made by the Company – see Note no. 51.

c. Entertainment Tax matters – ` 2,937.69 Lakh (previous year ` 2,259.12 Lakh). This includes:

i. Demand of ̀ 2,199.71 Lakh (previous year ̀ 1,752.24 Lakh) in respect of some multiplexes pertaining to exemption period and the Company is contesting the matter by way of appeal before appropriate authorities.

ii. Demand of ` 602.37 Lakh (previous year ` 477.34 Lakh) in respect of one multiplex where the eligibility for exemption from payment of entertainment tax is rejected and the Company is contesting the matter by way of appeal before appropriate authorities.

iii. Other demands are mainly in respect of levy of entertainment tax on service charges and convenience fee collected.


d. Service Tax matters – ` 17,388.08 Lakh (previous year ` 4,826.40 Lakh). This includes: i. Amount of ̀ 15,027.63 Lakh (previous year ̀ 3,234.28 Lakh) is in respect of levy of service tax on film distributors’

share paid by the Company and the matter is being contested by way of appeal/representation before the appropriate authorities.

ii. Amount of ` 2,360.45 Lakh (previous year ` 1,502.00 Lakh) for which the Company has received a show cause notice regarding levy of service tax on sale of food and beverages in multiplex premises the Company has filed replies to these show cause notices.

e. Stamp duty matter – ` 263.81 Lakh (previous year ` 263.81 Lakh)

Authority has raised the demand for non-payment of stamp duty on Leave & License Agreement in respect of one of the multiplexes, holding the same as lease transaction. Stay has been granted and the matter is pending before Board of Revenue.

f. Custom duty matter – ` 4.36 Lakh (previous year ` 4.36 Lakh) The Company has received a notice in respect of custom duty payable on import of cinematographic films. The

amount of duty is not quantified by the authorities and the company has filed an appeal before the Appellate Tribunal and the same is pending hearing.

g. VAT matters – ` 261.87 Lakh (previous year ` 237.06 Lakh). This includes: Demand of ` 237.06 Lakh (previous year ` 237.06 Lakh) pursuant to reassessment order for the year 2008-09. The

Company has filed an appeal and stay is granted on payment of ` 2 Lakh.

h. Income-tax matters – ` 235.64 Lakh (previous year ` 19.48 Lakh). This includes: Assessment dues for assessment year 2013-14 of ̀ 216.16 Lakh (previous year ̀ Nil) and penalty levied for assessment

year 2010-11 of ̀ 19.48 Lakh (previous year ̀ 19.48 Lakh), which is being contested by the Company before appellate authorities.

i. The Company may be required to charge additional cost of ` 389.83 Lakh (previous year ` 389.83 Lakh) towards electricity from 1st June 2007 to 31st March 2010 pursuant to the increase in the tariff in case the appeal made with Maharashtra Electricity Regulatory Commission ‘MERC’ by the Company through the Multiplex Association of India is rejected and the case filed in the Supreme Court by one of the electricity supplier against the order of the Appellate Tribunal for Electricity, dated 19th January 2009, for change in category, in favour of the appeal made by the Multiplex Association of India is passed in favor of the electricity supplier. The Company has paid the whole amount to the respective authorities under protest (which is included in ‘Long term loans and advances’)

j. Counter-guarantee given for bank guarantee taken by a subsidiary company for ` 1,088.59 Lakh (previous year ` 751.90 Lakh)

In respect of above matters, no provision is considered necessary as the Company expects favourable outcome. Further, it is not possible for the Company to estimate the timing of further cash outflows, if any, in respect of these matters.

38. IN RESPECT OF ENTERTAINMENT-TAX EXEMPTION CLAIMED BY THE COMPANY AND ITS TREATMENT IN THESE ACCOUNTS:

a. The Entertainment Tax exemption in respect of some of the multiplexes of the Company has been accounted on the basis of eligibility criteria as laid down in the respective Schemes but is subject to final Orders yet to be received from respective authorities. Accordingly, the Company has not charged ` 1,184.00 Lakh to the Statement of Profit and Loss for the year ended 31st March, 2016 (previous year ` 923.57 Lakh) being the Entertainment Tax in respect of such Multiplexes and cumulative amount as on 31st March, 2016 is ` 5,281.89 Lakh (previous year ` 4,575.19 Lakh).


119

Annual Report 1516

b. In respect of two multiplexes being operated by the Company in Uttar Pradesh: In view of the revised eligibility norms notified during the previous year, these multiplexes became eligible for exemption from payment of entertainment tax, w.e.f. the date of commencement of commercial operations. Accordingly, the amount of ` 616.74 Lakh, being entertainment tax paid in respect of these two multiplexes in earlier years, was credited to the Statement of Profit and Loss in the previous year.

39. The arbitration award in the matter of disputed recoveries pertaining to one of the multiplexes of the Company has been received in favour of the Company and the arbitrator has further granted interest claimed on the unpaid amount at the rate of 15% p.a. The Company has accordingly accounted interest of ` 4.56 Lakh (previous year ` 18.24 Lakh). Total amount of interest receivable upto 31st March, 2016 is ` 170.91 Lakh (previous year ` 166.30 Lakh). The said award has been challenged before the District Court and the matter is pending.

40. COMMITMENTS: a. Capital commitments: Estimated amounts of contracts remaining to be executed on capital account and not provided for, net of advances -

` 4,399.78 Lakh (previous year ` 1,772.30 Lakh).

b. Other commitments: The exemption from payment of Entertainment Tax in respect of multiplexes of the Company, which are eligible for

such exemption, is subject to fulfillment of the terms and conditions of the respective State Government policies issued in this regard. The amount of Entertainment Tax exemption availed so far by the Company, which is liable to be paid if the relevant multiplex ceases operations prior to completing the minimum period of operations in terms of the respective policies of the States – ` 14,293.47 Lakh (previous year ` 14,786.01 Lakh). Out of this, an amount of ` 1,112.67 Lakh (previous year ` 1,012.64 Lakh) is included in para 37(c) above, being entertainment tax disputes pertaining to exemption period.

41. The Company has, in May 2015, detected a fraud perpetrated by one of its employees in respect of travel bills from travel agencies, who were otherwise booking air tickets for bona-fide travel undertaken by employees and other persons for and on behalf of the Company. A confession statement has been given by the said employee. The Company has filed a First Information Report (FIR) with the Police Station and terminated the services of the employee immediately. At present the matter is under further investigation by the Police. The estimate of amount involved, as assessed by the Company, is ̀ 418.30 Lakh which has already been charged to the statement of profit and loss in respective years.

42. (a) Expenditure in foreign currency:

(` in Lakh)Particulars 2015-2016 2014-2015Travelling expenses 39.50 30.49Interest on deferred credit 68.10 182.54

(b) Value of imports on CIF basis:

(` in Lakh)Particulars 2015-2016 2014-2015Capital goods 459.92 40.79Materials 441.03 261.11

(c) All items of food and beverages are indigenously procured by the Company


43. Foreign currency exposures not hedged as at Balance Sheet date:

Particulars 31 Mar 2016(USD in Lakh)

31 Mar 2015(USD in Lakh)

Creditors for capital goods 4.13 39.03Interest outstanding on buyers credit 0.03 0.07

44. Legal and professional fees paid include:

(` in Lakh)Particulars 31 Mar 2016 31 Mar 2015a) Legal fees paid to firms/LLPs in which one of the directors is a partner 122.10 130.30b) Professional fees paid to one of the directors 30.00 30.00c) Payment to Auditors Statutory Audit (including consolidated accounts) 22.50 17.50 Tax Audit and other audits under Income-tax Act 9.50 9.50 Limited Review & Corporate Governance Report 6.50 6.25 For taxation matters 2.50 2.75 Certification matters 3.30 2.68 Other mattes 3.00 - Out of pocket expenses 0.09 0.19 Total 47.39 38.87

45. The Company’s significant leasing arrangements are in respect of :-

a. The Company is operating some of the multiplexes under operating lease / business conducting arrangement. These arrangements are for an initial period of 9-25 years with a minimum lock-in period of 3-10 years and the agreements provide for escalation after pre-determined periods. Lease payments of ` 15,764.21 Lakh (previous year ` 12,379.39 Lakh) are included in ‘Property Rent and Conducting Fees’ in Note no. 29 to the Statement of Profit and Loss.

The future minimum payments under these arrangements are as under:

(` in Lakh)Particulars 2015-2016 2014-2015Not later than one year 16,082.62 11,900.61Later than one year and not later than five years 64,417.48 43,434.17Later than five years 1,60,198.33 1,13,945.09Total 2,40,698.43 1,69,279.87

b. In respect of operating leases for office premises/godowns: The arrangements range between 11 months to 36 months and are usually renewable by mutual consent on mutually agreeable terms. Lease payments of ` 94.97 Lakh (previous year ` 11.27 Lakh) are included in ‘Property Rent and Conducting Fees’ in Note no. 29 to the Statement of Profit and Loss.

46. Interest in Joint Venture The Company’s interests in Swanston Multiplex Cinemas Private Limited (‘SMCPL’), is accounted for in accordance with the

principles and procedures set out in Accounting Standard (AS 27) ‘Financial Reporting of Interests in Joint Ventures’ specified in the Companies (Accounting Standards) Rules, 2006.

The interest in the joint venture is reported as non-current investment (refer note no. 15) and stated at cost, less provision for diminution, other than temporary, in the value of investment. The Company has 50% ownership interest in SMCPL. The Company’s share of each of the assets, liabilities, income and expenses, etc. (each without elimination of the effect of transactions between the Company and the joint venture) related to its interests in the joint venture, based on audited financial statements is:


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(` in Lakh)Particulars 31 Mar 2016 31 Mar 2015Assets 65.41 66.81Liabilities 71.24 71.64

(` in Lakh)Particulars 2015-2016 2014-2015Income 0.01 15.20Expenses 1.01 10.20

Company’s share of contingent liabilities in SMCPL is ` 5.60 Lakh (previous year ` 5.60 Lakh). The Company’s transactions with SMCPL, being related party transactions, are included in Note no. 49.

47. Segment Information The Company operates in a single business segment viz. theatrical exhibition. All activities of the Company are in India

(domestic market) and hence there are no reportable geographical segments.

48. Employee Benefits: a) Defined Contribution Plans: Contribution to Provident Fund of ` 409.28 Lakh (previous year ` 331.47 Lakh) is

recognized as an expense and included in ‘Contribution to provident and other funds’ in the Statement of Profit and Loss and ` 19.58 Lakh (previous year ` 17.35 Lakh) is included in pre-operative expenses.

b) Defined Benefit Plans: The amounts recognized in respect of Gratuity and Leave Encashment are as under:

(` in Lakh)Particulars Gratuity Leave Encashment

2015-2016 2014-2015 2015-2016 2014-20151. Change in Benefit ObligationLiability at the beginning of the year 455.21 344.01 183.50 143.10Addition on account of amalgamation 53.47 - 26.93 -Interest Cost 39.61 29.25 16.39 11.32Current Service Cost 115.30 115.65 78.13 118.96Benefit paid (55.45) (40.82) (49.63) (35.59)Actuarial (Gain)/Loss 25.06 7.12 (12.39) (54.29)Actuarial Liability at the end of the year 633.20 455.21 242.93 183.50Add: Short term leave liability - - 57.43 43.26Liability at the end of the year 633.20 455.21 300.36 226.762. Expenses recognized in the Statement of Profit and LossCurrent Service Cost 115.30 115.65 78.13 118.96Interest Cost 39.61 29.25 16.39 11.32Actuarial (Gain)/Loss 25.06 7.12 (12.39) (54.29)Expenses recognized in the Statement of Profit and Loss 179.97 152.02 82.13 76.003. Actuarial AssumptionsDiscount Rate 7.70% 7.77% 7.70% 7.77%Salary Escalation Rate 7%Retirement Age 58 yearsWithdrawal Rates 10%Mortality IALM (2006-08) Ultimate Mortality Table


(` in Lakh)2015-16 2014-15 2013-14 2012-13 2011-12

4. Other disclosures: Experience adjustmentGratuityPresent value of defined benefit obligation 633.20 455.21 344.01 270.35 152.95Experience adjustment on plan liabilities – (gain)/loss

22.07 (30.23) (7.75) (12.86) (9.09)

Leave BenefitsPresent value of defined benefit obligation 242.93 183.50 143.10 151.68 72.66Experience adjustment on plan liabilities – (gain)/loss

(13.54) (69.15) (87.20) (19.42) (25.05)

The above defined benefit plans are unfunded. The estimate of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market. 49. Related Party Disclosure: (i) Where Control Exists a. Gujarat Fluorochemicals Limited – holding company b. INOX Leasing & Finance Limited – ultimate holding company c. Satyam Cineplexes Limited – subsidiary company w.e.f 8th August 2014 and subsequently amalgamated w.e.f. 8th

August 2014 – see note no. 30 d. Shouri Properties Private Limited – subsidiary company w.e.f. 24th November 2014 (ii) Other related parties with whom there are transactions:

Fellow Subsidiary a. INOX Wind Limited – subsidiary of Gujarat Fluorochemicals Limited

Joint Venture a. Swanston Multiplex Cinemas Private Limited

Key Management Personnel (KMP) a. Mr. Pavan Kumar Jain – Director b. Mr. Alok Tandon – Chief Executive Officer

Relatives of KMP a. Mr. Vivek Kumar Jain – brother of Mr. Pavan Kumar Jain b. Mr. Siddharth Jain - son of Mr. Pavan Kumar Jain

Enterprises over which a KMP, or his relative, has significant influence a. INOX India Private Limited (earlier INOX India Limited)


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(iii) Particulars of transactions:-(` in Lakh)

Particulars Holding/ultimate holding and subsidiary

companies

Key Management Personnel (KMP) / relatives of KMP

Fellow subsidiaries / Joint Venture

Enterprises over which a KMP, or his relative, has

significant influence

Total

A) Transactions during the year 2015-16 2014-15 2015-16 2014-15 2015-16 2014-15 2015-16 2014-15 2015-16 2014-151. Interest paid Gujarat Fluorochemicals Limited 1,624.90 1,624.90 - - - - - - 1,624.90 1,624.90 INOX Leasing & Finance Limited - 108.58 - - - - - - - 108.58 Total 1,624.90 1,733.48 - - - - - - 1,624.90 1,733.482. Remuneration paid Mr. Alok Tandon - - 93.96 97.65 - - - - 93.96 97.65 Total - - 93.96 97.65 - - - - 93.96 97.653. Interest received - Satyam Cineplexes Limited N.A. 320.72 - - - - - - N.A. 320.724. Lease rental paid Gujarat Fluorochemicals Limited 82.09 - - - - - - - 82.09 -5. Reimbursement of expenses paid Gujarat Fluorochemicals Limited 23.42 - - - - - - - 23.42 -6. Sales and services Gujarat Fluorochemicals Limited 4.58 4.86 - - - - - - 4.58 4.86 Satyam Cineplexes Limited N.A. 0.60 - - - - - - N.A. 0.60 INOX Wind Limited - - - - - 71.07 - - - 71.07 INOX India Private Limited - - - - - - 2.34 2.58 2.34 2.58 Total 4.58 5.46 - - - 71.07 2.34 2.58 6.92 79.117. Equipment Lease Rent Received

Satyam Cineplexes LimitedN.A. 1.30 - - - - - - N.A. 1.30

8. Internet Sales Charges paid Satyam Cineplexes Limited

N.A. 32.04 - - - - - - N.A. 32.04

9. Advertisement Expenses paid Satyam Cineplexes Limited

N.A. 1.54 - - - - - - N.A. 1.54

10. Conducting Fees paid Shouri Properties Private Limited

354.69 107.44 - - - - - - 354.69 107.44

11. Counter-guarantee given for bank guarantee taken by subsidiary company Shouri Properties Private Limited

336.69 751.90 - - - - - - 336.69 751.90

12. Subscription towards equity shares Shouri Properties Private Limited

125.00 15.00 - - - - - - 125.00 15.00

13. Reimbursement of expenses received Satyam Cineplexes Limited

N.A. 0.38 - - - - - - N.A. 0.38

14. Inter-corporate deposits repaid INOX Leasing & Finance Limited

- 1,100.00 - - - - - - - 1,100.00

15. Inter-corporate deposit given Satyam Cineplexes Limited

N.A. 4,580.11 - - - - - - N.A. 4,580.11

16. Share application money paid Swanston Multiplex Cinemas Pvt. Ltd.

- - - - - 30.00 - - - 30.00

17. Share application money received back Swanston Multiplex Cinemas Pvt. Ltd.

- - - - - 45.00 - - - 45.00

18. Provision for diminution in value of investment reversed Swanston Multiplex Cinemas Pvt. Ltd.0

- - - - - 9.48 - - - 9.48

19. Sitting fees paid to director

Mr. Pavan Kumar Jain - - 1.40 1.20 - - - - 1.40 1.20 Mr. Vivek Kumar Jain - - 1.00 1.80 - - - - 1.00 1.80 Mr. Siddharth Jain - - 1.20 1.60 - - - - 1.20 1.60 Total - - 3.60 4.60 - - - - 3.60 4.60


(` in Lakh)Particulars Holding/

ultimate holding and subsidiary

companies

Key Management Personnel (KMP) / relatives of KMP

Fellow subsidiaries / Joint Venture

Enterprises over which a KMP, or his relative, has


Total

B) Amounts outstanding 31 Mar 2016

31 Mar 2015

31 Mar 2016

31 Mar 2015

31 Mar 2016

31 Mar 2015

31 Mar 2016

31 Mar 2015

31 Mar 2016

31 Mar 2015

1. Inter-corporate deposit taken Gujarat Fluorochemicals Limited

16,249.00 16,249.00 - - - - - - 16,249.00 16,249.00

2. Inter-corporate deposit given Satyam Cineplexes Limited

N.A. 4,580.11 - - - - - - N.A. 4,580.11

3. Trade receivables INOX Wind Limited - - - - - 33.82 - - - 33.82 INOX India Private Limited - - - - - - 0.27. 0.37 0.27. 0.37 Total - - - - - 33.82 0.27. 0.37 0.27. 34.194. Trade payables Gujarat Fluorochemicals Limited 0.93 - - - - - - - 0.93 - Satyam Cineplexes Limited N.A. 54.23 - - - - - - N.A. 54.23 Total 0.93 54.23 - - - - - - 0.93 54.235. Counter-guarantee given for bank

guarantee taken by subsidiary company

Shouri Properties Private Limited 1,088.59 751.90 - - - - - - 1,088.59 751.906. Security deposit given Shouri

Properties Private Limited79.07 79.07 - - - - - - 79.07 79.07

50. (a) Additional disclosure as required by Listing Agreement in respect of loan given:(` in Lakh)

Particulars 2015-2016 2014-2015Name of loanee Satyam Cineplexes LimitedAmount of loan at the year end N.A. 4,580.11Maximum balance during the year N.A. 4,580.11Investment by the loanee in the shares of the Company N.A. Nil

Note: The loan was given to Satyam Cineplexes Limited (“SCL”) after it became a subsidiary on 8th August 2014. Subsequently SCL is amalgamated with the Company w.e.f. 8th August 2014 (see note no. 30)

(b) Disclosure required under section 186(4) of the Companies Act, 2013 During the previous year, the Company had given a loan of ` 4,580.11 Lakh to Satyam Cineplexes Limited, after it

became a subsidiary on 8th August 2014. Subsequently SCL is amalgamated with the Company w.e.f. 8th August 2014 (see note no. 30). The unsecured loan carried interest @ 11.50%, was repayable on demand and was given for general business purposes.

The Company has given a counter guarantee of ` 1,088.59 Lakh (previous year ` 751.90 Lakh) in respect of bank guarantee taken by its subsidiary, Shouri Properties Private Limited. This bank guarantee is towards entertainment tax exemption availed by the subsidiary. The Company has a leasing arrangement with this subsidiary and operates a multiplex from the said location.

During the year, the Company had given an inter-corporate deposit of ` 100.00 Lakh to Deepa Bagla Financial Consultants Pvt. Ltd for general business purpose and carried interest at 11% p.a.

51. Particulars in respect of provision for expenses(` in Lakh)

Particulars 2015-2016 2014-2015a) In respect of municipal taxes payable for one of its multiplexes Opening Balance 183.00 200.20 Provided during the year 52.80 52.80 Paid during the year Nil 70.00 Closing balance 235.80 183.00b) Towards MVAT Opening Balance 39.38 39.61 Paid during the year 14.38 0.23 Reversed during the year 25.00 Nil Closing balance Nil 39.38


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(` in Lakh)Particulars 2015-2016 2014-2015c) For service tax on renting of immovable properties Opening Balance 1,042.44 1,042.44 Provided during the year Nil Nil Paid during the year Nil Nil Closing balance 1,042.44 1,042.44

52. Corporate Social Responsibility (CSR) (a) The gross amount required to be spent by the Company during the year towards Corporate Social Responsibility

(CSR) is ` 68.03 Lakh (previous year ` 62.44 Lakh). (b) Amount spent during the year on:

(` in Lakh)Sr. No. Particulars In cash Yet to be paid

in cashTotal

(i) Construction/acquisition of any fixed assets Nil(Nil)

Nil(Nil)

Nil(Nil)

(ii) On purposes other than (i) aboveDonations

5.00(45.31)

Nil(Nil)

5.00(45.31)

Note: Figures in brackets pertain to previous year.53. Particulars of dues to Micro, Small and Medium Enterprises under Micro, Small and Medium Enterprises Development Act,

2006 (“MSMED Act”):(` in Lakh)

Particulars 2015-2016 2014-2015Principal amount due to suppliers under MSMED Act at the year end 5.39 1.80Interest accrued & due to suppliers under MSMED Act on the above amount, unpaid at the year end 0.62 0.24Payment made to suppliers (other than interest) beyond the appointed day during the year 31.25 19.99Interest paid to suppliers under section 16 of MSMED Act during the year 0.00 0.00Interest due & payable to suppliers under MSMED Act for payments already made 0.81 0.44Interest accrued & remaining unpaid at the end of the year to supplier under MSMED Act

6.18 4.75

The above information has been disclosed in respect of parties which have been identified on the basis of the information available with the Company.

54. Prior period items included in ‘Miscellaneous expenses’: Reversal of sale of services - ` 142.71 Lakh (previous year ` Nil)

55. Calculation of Earnings per share :(` in Lakh)

Particulars 2015-2016 2014-2015Profit after tax as per Statement of Profit and Loss (` in Lakh) 7,764.46 2,476.46Weighted average number of equity shares used in computing basic earnings per shares (nos.) 9,18,12,661 9,18,09,663Weighted average number of equity shares used in computing diluted earnings per shares (nos.) 9,18,12,661 9,18,09,663Basic earnings per share of ` 10/- each (`) 8.46 2.70Diluted earnings per share of ` 10/- each (`) 8.46 2.70

Note: The shares of the Company held by INOX Benefit Trust (see note no. 31), being Treasury Shares, are excluded while computing the weighted average number of shares.







Report on the Consolidated Financial StatementsWe have audited the accompanying consolidated financial statements of INOX Leisure Limited (“the Holding Company”) and its subsidiary (the Holding Company and its subsidiary together referred to as “the Group”) and a jointly controlled entity, which comprise the Consolidated Balance Sheet as at 31st March 2016, the Consolidated Statement of Profit and Loss and the Consolidated Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information (“the consolidated financial statements”).

Management’s Responsibility for the Consolidated Financial StatementsThe Holding Company’s Board of Directors is responsible for the preparation of these consolidated financial statements in terms of the requirements of the Companies Act, 2013 (“the Act”) that give a true and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows of the Group including jointly controlled entity in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. The respective Board of Directors of the companies included in the Group and a jointly controlled entity are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Group and jointly controlled entity 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 statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the consolidated financial statements by the Directors of the Holding Company, as aforesaid.

Auditor’s ResponsibilityOur responsibility is to express an opinion on these consolidated financial statements based on our audit.

While conducting the audit, we have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Holding Company’s preparation of the consolidated financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Holding Company’s Board of Directors, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on these consolidated financial statements.

OpinionIn our opinion and to the best of our information and according to the explanations given to us, the aforesaid consolidated financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Group and its jointly controlled entity as at 31st March 2016, its consolidated profit and its consolidated cash flows for the year ended on that date.

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Report on Other Legal and Regulatory Requirements

As required by Section 143 (3) of the Act, we report 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 of the aforesaid consolidated financial statements.

(b) In our opinion, proper books of account as required by law relating to preparation of the consolidated financial statements have been kept so far as it appears from our examination of those books.

(c) The Consolidated Balance Sheet, the Consolidated Statement of Profit and Loss, and the Consolidated Cash Flow Statement dealt with by this Report are in agreement with the relevant books of account maintained for the purpose of preparation of the consolidated financial statements.

(d) In our opinion, the aforesaid consolidated financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

(e) On the basis of the written representations received from the directors of the Holding Company as on 31st March, 2016 taken on record by the Board of Directors of the Holding Company and on the basis of reports of the statutory auditors of its subsidiary and jointly controlled entity, none of the directors of the Group and jointly controlled entity are disqualified as on 31st March, 2016 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 Group and the jointly controlled entity and the operating effectiveness of such controls, refer to our separate report in Annexure.

(g) 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, in our opinion and to the best of our information and according to the explanations given to us:

i. The consolidated financial statements disclose the impact of pending litigations on the consolidated financial position of the Group and its jointly controlled entity – see note no. 36 to the consolidated financial statements;

ii. The Group and its jointly controlled entity did not have any long term contracts including derivative contracts, for which there were any material foreseeable losses; and

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Holding Company. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by its subsidiary and the jointly controlled entity.





Annexure to Independent Auditor’s Report

Annexure to Independent Auditor’s Report to the members of INOX Leisure Limited on the consolidated financial statements for the year ended 31st March 2016 – referred to in paragraph (f) under the heading “Report on Other Legal and Regulatory Requirements” of our report of even date.

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)In conjunction with our audit of the consolidated financial statements of INOX Leisure Limited (hereinafter referred to as “the Holding Company”) as of and for the year ended March 31, 2016, we have audited the internal financial controls over financial reporting of the Holding Company and its subsidiary company and jointly controlled entity, which are companies incorporated in India, as of that date.

Management’s Responsibility for Internal Financial ControlsThe respective Board of Directors of the Holding company and its subsidiary company and jointly controlled entity which are companies incorporated in India, are responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the respective companies considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) issued by the Institute of Chartered Accountants of India (“ICAI”). 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 the 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 (the “Act”).

Auditor’s ResponsibilityOur responsibility is to express an opinion on the Holding Company’s, its subsidiary company’s and jointly controlled entity’s, internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by ICAI. 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 performing 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 consolidated 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 Holding Company’s, and its subsidiary company’s and jointly control entity’s, internal financial controls with reference to financial statements 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 reporting 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.

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Inherent Limitations of Internal Financial Controls Over Financial ReportingBecause 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, the Holding Company and its subsidiary company and jointly controlled entity, which are companies incorporated in India, have, 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 31st March 2016, based on the internal control over financial reporting criteria established by the Holding Company and its subsidiary and jointly controlled entity, considering the essential components of internal control stated in the Guidance Note issued by ICAI.




Annexure to Independent Auditor’s Report

Consolidated Balance Sheetas at 31st March 2016

(` in Lakh)


As at 31st Mar 2016

As at 31st Mar 2015

I EQUITY AND LIABILITIES 1 Shareholders' Funds

(a) Share capital 4 9,616.28 9,616.28 (b) Reserves and surplus 5 52,726.66 61,269.79 (c) Interest in INOX Benefit Trust, at cost 31 (3,266.98) (3,266.98)

59,075.96 67,619.09 2 Non-Current Liabilities

(a) Long-term borrowings 6 21,693.00 20,050.56 (b) Deferred tax liabilities (net) 7 585.84 2,432.47 (c) Other long term liabilities 8 235.37 432.90 (d) Long-term provisions 9 777.96 613.40

23,292.17 23,529.33 3 Current Liabilities

(a) Short term borrowings 10 2,512.65 1,469.91 (b) Trade payables (i) Dues to Micro and Small Enterprises 11 5.39 1.80 (ii) Dues to others 11 7,325.44 7,839.68 (c) Other current liabilities 12 8,872.01 10,140.50 (d) Short-term provisions 9 1,693.94 1,550.03

20,409.43 21,001.92 TOTAL 102,777.56 112,150.34

II ASSETS 1 Goodwill on Consolidation 41.85 16,520.98 2 Non-Current Assets

(a) Fixed assets (i) Tangible assets 13 61,990.89 61,309.44 (ii) Intangible assets 13 2,870.82 393.60 (iii) Capital work-in-progress 14 5,572.83 5,107.66

70,434.54 66,810.70 (b) Non-current investments 15 110.53 70.63 (c) Long term loans and advances 16 19,384.32 18,130.23 (d) Other non-current assets 17 1,280.99 396.25

91,210.38 85,407.81 3 Current Assets

(a) Current investments 15 1,553.50 641.37 (b) Inventories 18 684.87 759.11 (c) Trade receivables 19 5,349.82 6,231.88 (d) Cash and bank balances 20 2,707.73 1,344.32 (e) Short-term loans and advances 21 1,082.65 1,068.06 (f) Other current assets 22 146.76 176.81

11,525.33 10,221.55 TOTAL 102,777.56 112,150.34

The accompanying notes are an integral part of the financial statements.





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Consolidated statement of Profit and Loss for the year ended 31st March 2016

(` in Lakh)




REVENUE Revenue from operations 23 133,268.59 101,681.29 Other income 24 432.46 826.51 Total revenue 133,701.05 102,507.80

EXPENSES Entertainment tax 17,380.94 12,145.12 Exhibition cost 25 32,529.99 24,932.44 Cost of food and beverages 26 6,610.68 4,954.91 Employee benefits expense 27 7,466.12 6,581.56 Finance costs 28 2,441.76 3,861.00 Depreciation & amortization expense 13 8,028.76 7,583.64 Other expenses 29 50,289.74 40,790.12 Total expenses 124,747.99 100,848.79

Profit before exceptional items and tax 8,953.06 1,659.01 Less: Exceptional items 32 496.02 60.00 Profit before tax 8,457.04 1,599.01 Tax expenses

Current tax 35(a) 3,457.00 839.00 Deferred tax (360.63) (332.61) Taxation pertaining to earlier years 35(b) (2,388.33) (911.19)

708.04 (404.80)

Profit for the year 7,749.00 2,003.81

Earnings per equity share of ` 10 each (`) 50 Basic 8.44 2.18 Diluted 8.44 2.18

The accompanying notes are an integral part of the financial statements.





Consolidated Cash Flow statement for the year ended 31st March 2016


31st Mar 2016 Year ended

31st Mar 2015

A Cash flow from operating activitiesNet profit before tax 8,457.04 1,599.01 Adjustments for :Depreciation and amortization expense 8,028.76 7,583.64 Loss of retirement/disposal of fixed assets (net) 326.66 4.89 Provision for diminution in value of assets held for disposal 14.98 17.03 Bad debts and remissions 118.05 - Deposits and advance written off 211.85 40.57 Provision for doubtful debts 175.77 26.20 Provision for doubtful advances and deposits 120.58 311.88 Liabilities and provisions, no longer required, written back (121.33) (245.50)Amortization of value of stock options - 1.36 Interest income (143.53) (188.77)Gain on sale of current investments (143.06) (376.57)Finance cost 2,441.75 3,861.00 Operating profit before working capital changes 19,487.52 12,634.74

Changes in working capitalTrade payables 248.40 335.43 Long-term provisions 164.56 140.19 Short-term provisions 20.05 (49.28)Other current liabilities 42.24 (3,493.63)Other long term liabilities (19.05) 15.79 Other non-current assets - (21.53)Other current assets - (0.95)Trade receivables 641.19 (2,339.63)Inventories 74.24 180.02 Long-term loans and advances (2,201.37) (2,584.91)Short-term loans and advances (13.31) 293.54 Cash generated from operations 18,444.47 5,109.78 Direct taxes paid (net) (1,539.61) (592.63)Net cash generated from operating activities 16,904.86 4,517.15

B Cash flow from investing activitiesPurchase of fixed assets (including change in Capitalwork-in-progress, capital advances and pre-operative expenses) (12,249.22) (9,390.71)Sale of fixed assets 11.44 93.05 Acquisition of intangible assets (2,701.78) (112.88)Investment in subsidiary companies - (18,390.38)Payment towards share purchase consideration payable (61.30) - Purchase of other non-current investments (22.53) (14.20)Redemption of other non-current investments 13.38 16.11 Purchase of current investments (14,207.00) (29,988.50)Sale/redemption of current investments 13,405.95 30,018.05 Proceeds from sale of treasury shares - see note no. 31 - 27,033.18 Movement in bank fixed deposits with original maturity ofmore than 3 months (net) (50.27) 171.66 Interest received 136.65 275.19 Net cash used in investing activities (15,724.68) (289.43)

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Consolidated Cash Flow statement for the year ended 31st March 2016


31st Mar 2016 Year ended

31st Mar 2015C Cash flow from financing activities

Shares issued under ESOP - 2.49 Repayment of Inter-corporate deposit - (1,100.00)Proceeds from long term loans 4,141.00 2,618.00 Repayment of long term loans (2,598.56) (2,220.46)Proceeds from short term borrowings (net) 988.63 (92.11)Finance costs (2,468.97) (4,213.13)Net cash generated from / (used in) financing activities 62.10 (5,005.21)Net increase / (decrease) in cash and cash equivalents 1,242.28 (777.49)Cash and cash equivalents at the beginning of the year 1,019.92 1,475.77 Add : Cash and cash equivalents on acquisition of subsidiaries - see note no 1(B)

- 321.64

Cash and cash equivalents at the end of the year 2,262.20 1,019.92 Notes: 1 The above Cash Flow Statement has been prepared and presented under the 'Indirect Method'.2 Components of cash and cash equivalents are as per note no. 20.3 The accompanying notes are an integral part of the financial statements.





1. CORPORATE INFORMATION INOX Leisure Limited (“the Company”) is a public Company engaged in the business of operating & managing multiplexes

and cinema theatres in India. The shares of the Company are listed on the Bombay Stock Exchange and the National Stock Exchange of India. The Company is a subsidiary of Gujarat Fluorochemicals Limited.

The Consolidated Financial Statements (“CFS”) relate to the company, its subsidiaries and a joint venture of the Company (collectively referred to as the “Group”).

(A) Subsidiary companies and joint ventures considered in these consolidated financial statements are:

Subsidiaries:

Name of the Company Country of incorporation

Proportion of ownership interest As at 31st

March 2016As at 31st

March 2015Satyam Cineplexes Limited (amalgamated with the Parent Company – see para (B)(i)

India N.A. 100%

Shouri Properties Private Limited India 99.29% 93.75%

Satyam Cineplexes Limited was engaged in the business of operating and managing multiplexes in India. Shouri Properties Private Limited holds a license to operate a multiplex cinema theatre which is operated by the Company.

Joint Venture: The Parent Company has a Joint Venture interest of 50% in Swanston Multiplex Cinemas Private Limited (‘SMCPL’), a company incorporated in India. As at 31st March, 2016 the Company has invested a sum of ` 279.52 lacs in the share capital of SMCPL. SMPCL was engaged in the business of operating a multiplex.

(B) Changes during the year:-

i) During the previous year, the Company had acquired 100% of the equity shares in Satyam Cineplexes Limited (“SCL”) and consequently SCL had become a wholly owned subsidiary of the Company with effect from 8th August 2014. During the current year, pursuant to Scheme of Amalgamation (the “Scheme”) under Sections 391 to 394 of the Companies Act, 1956, sanctioned by the Hon’ble High Court of Delhi vide order dated 10th February, 2016, SCL has been amalgamated with the Company with effect from 8th August, 2014 (the appointed date) and effect of the amalgamation is given in these financial statements (see note no. 30)

ii) During the previous year, the Company had acquired 93.75% of the equity shares in Shouri Properties Private Limited (“SPPL”) and consequently SPPL had become a subsidiary of the Company with effect from 24th November 2014. During the current year, the Company has further subscribed to 12,50,000 equity shares of SPPL. On allotment of these shares, the Company now holds 99.29% Equity Shares of SPPL.

(C) Additional information as required under Schedule III of the Companies act, 2013:

(` in Lakh)

Name of the entity

Net Assets, i.e., total assets minus total liabilities

Share in profit or loss

As % of consolidated

net assets

Amount As % of consolidated profit or loss

Amount

Parent-INOX Leisure Limited 100.06% 59110.32 100.20% 7764.44Indian Subsidiary – Shouri Properties Pvt Ltd. 0.12% 69.55 (-) 0.19% (14.44)Joint Venture-Swanston Multiplex Cinemas Pvt. Ltd. (-) 0.01% (5.83) (-) 0.01% (1.00)Consolidation eliminations/adjustments (-) 0.17% (98.08) Nil NilGrand total 100.00% 59075.96 100.00% 7749.00Minority interest in subsidiaries Nil Nil Nil Nil

Notes to the consolidated financial statementsfor the year ended 31st March 2016

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2. BASIS OF PREPARATION AND PRINCIPLES OF CONSOLIDATION :- The CFS are prepared in accordance with Accounting Standard (AS) 21 “Consolidated Financial Statements” and Accounting

Standard (AS) 27 “Financial Reporting of Interest in Joint Ventures”, specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014.

The CFS have been prepared on the following basis.

a) The financial statements of the Company and its subsidiaries have been combined on a line by line basis by adding together the book values of like items of assets, liabilities, income and expenses. Inter-company balances, inter-company transactions and unrealised profits are fully eliminated. Unrealised losses resulting from Inter-company transactions are eliminated unless cost cannot be recovered.

b) Interest in joint venture is reported using proportionate consolidation method.

c) Goodwill on consolidation represents excess of the cost to the parent of its investment in a subsidiary over the parent’s portion of equity of the subsidiary, at the date on which investment in the subsidiary is made, and is recognized as an asset in the consolidated financial statements. The Goodwill on consolidation is evaluated for impairment whenever there is any indication that its carrying amount may have been impaired. When the cost to the parent of its investment in a subsidiary is less than that the parent’s portion of equity of the subsidiary, the difference is treated as capital reserve in the consolidated financial statements.

d) The CFS are prepared using uniform accounting policies for the like transactions and other events in similar circumstances, except where it is not practicable to do so. The CFS are presented, to the extent possible, in the same manner as the Parent Company’s separate financial statements.

e) The Minority interest in the net assets of consolidated subsidiaries consist of the amount of equity attributable to minority at the date on which investment in subsidiary is made and the minority’s share of movement in equity since the date the parent subsidiary relationship comes into existence. The losses applicable to the minority, to the extent they exceed the minority interest in the equity of the subsidiary, are adjusted against the majority interest, until the minority’s share of losses so absorbed by the majority has been recovered.

3. SIGNIFICANT ACCOUNTING POLICIES a) Revenue Recognition: Revenue from Box Office is recognized as and when the movie is exhibited. Revenue from Sale of Food & Beverages is

accounted at the point of sale. These revenues are net of refunds and complimentary. Conducting fees are in respect of charges received from parties to conduct business from the Company’s Multiplexes and the revenue is recognized as per the contractual arrangements. Advertisement income is recognized on exhibition of the advertisement or over the period of contract, as applicable. Income from sale of power is recognized on the basis of actual units generated and transmitted to the purchaser. Dividend income is recognised when the unconditional right to receive payment is established. Income from interest on deposits, loans and interest-bearing securities is recognised on time proportion basis.

b) Fixed Assets: Fixed assets are carried at cost, as reduced by accumulated depreciation/amortization, except freehold land, which

is carried at cost. Cost comprises of purchase price / cost of construction, including non-refundable taxes or levies, and any expenses attributable to bring the assets to its working condition for its intended use. Project pre-operative expenses and expenditure incurred during construction period of multiplexes are capitalized to various eligible assets in respective multiplexes. Borrowing costs directly attributable to acquisition or construction of qualifying fixed assets are capitalised. In respect of accounting period commencing on or after 1 April 2011, consequent to the insertion of para 46A in Accounting Standard of (AS 11): The Effects of Changes in Foreign Exchange Rates, cost of depreciable capital assets include foreign exchange differences arising on translation of long term foreign currency monetary items. Fixed assets retired from active use and held for sale are stated at the lower of their net book value and net realisable value and are disclosed separately under current assets.



c) Depreciation and amortization:

On tangible assets - cost of leasehold land is amortized over the period of lease. On other fixed assets, excluding freehold land, depreciation is provided on straight-line basis as under:

I. On leasehold improvements, electrical installations & air conditioners in leased premises, over the period of useful life on the basis of the respective agreements or the useful life as per Part C of Schedule II to the Companies Act, 2013, whichever is shorter.

II. On other fixed assets, on the basis of useful life as per Part C of Schedule II to the Companies Act, 2013

On intangible assets - cost of software is amortized over a period of three years in case of operating software and six years in case of other software. Cost of goodwill and movie script acquired and cost of web-site developed is amortized over a period of five year.

d) Impairment of assets: Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the

carrying amount of the Company’s asset. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount.

e) Investments: Long-term investments are carried at cost. Provision for diminution is made to recognize the decline, other than

temporary, in the values of these investments. Current investments are carried at lower of the cost and fair value.

f) Inventories: Inventories are valued at lower of the cost and net realisable value. Cost is determined using first-in-first-out (FIFO)

method.

g) Employee Benefits: Short-term employee benefits are recognized as an expense at the undiscounted amount in the statement of profit and

loss in the year in which related services are rendered. Company’s contribution towards Defined Contribution Plan viz. Government administered provident fund and pension schemes, paid / payable during the year are charged to the statement of profit and loss. Defined Benefit Plans in the form of Gratuity and Leave Encashment are recognized as an expense in the statement of profit and loss at the present value of the amounts payable, determined on the basis of actuarial valuation techniques, using the projected unit credit method. Actuarial gains and losses are recognized in the statement of profit and loss.

h) Taxes on Income: Income tax expense comprises of current tax and deferred tax charge. Deferred tax is recognised, subject to

consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originates in one period and are capable of reversal in one or more subsequent periods. The deferred tax in respect of timing differences which reverse during the tax holiday period is not recognised to the extent the Company's gross total income is subject to the deduction during the tax holiday period. Minimum Alternate Tax (MAT) paid on the book profits, which gives rise to future economic benefits in the form of tax credit against future income-tax liability, is recognized as an asset in the Balance Sheet if there is convincing evidence that the Company will pay normal tax within the period specified for utilization of such credit.

i) Borrowing Cost: Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the

cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to Statement of Profit and Loss.

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j) Leases: Lease rentals in respect of assets acquired on operating lease are charged-off to the statement of profit and loss as per

the terms of the respective lease agreements.

k) Foreign Currency Transactions:

(i) Transactions in foreign currency are recorded in rupees by applying the exchange rate at the date of the transaction. Gains or losses on settlement of the transactions are recognized in the statement of profit and loss. At the Balance Sheet date, monetary assets and liabilities in foreign currency are restated by applying the closing rate, and the difference arising out of such conversion is recognized in the statement of profit and loss, except as mentioned in para (ii) below.

(ii) The Central Government has vide its notification no. G.S.R. 914(E) dated 29th December, 2011, amended Accounting Standard (AS 11) ‘The Effects of Changes in Foreign Exchange Rates’, notified under the Companies (Accounting Standards) Rules, 2006, to the extent it relates to the recognition of losses or gains arising on restatement of long-term foreign currency monetary items in respect of accounting periods commencing on or after 1st April 2011. As stipulated in the Notification, the Company has exercised the option to adopt the following policy irrevocably.

Long term foreign currency monetary items are translated at the exchange rate prevailing on the balance sheet date and the net exchange gain / loss on such conversion and on settlement of the liability, is adjusted to the cost of the asset, where the long-term foreign currency monetary items relate to the acquisition of a depreciable capital asset (whether purchased within or outside India), and depreciated over the balance life of the assets.

l) Treasury Shares: Pursuant to the Scheme of Amalgamation of Fame India Limited (‘Fame’) and its subsidiaries with the Company (see

note no. 31), equity shares of the Company have been issued to INOX Benefit Trust (the Trust) against the equity shares of Fame held by the Company. These shares are recognised as Interest in INOX Benefit Trust at the amount of consideration paid by the Company to acquire the shares of erstwhile Fame. These shares of the Company held by INOX Benefit Trust are akin to treasury shares and are presented as a deduction from Shareholders’ Funds. Difference between the cost and the amount received at the time sale of shares by the Trust, is recorded separately as ‘Reserve on Sale of Treasury Shares’ under Reserve and Surplus.

m) Provisions and Contingent Liabilities : A provision is recognized when the Company has a present obligation as a result of past event and it is probable that an

outflow of resources will be required to settle the obligation and in respect of which a reliable estimate can be made. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is possible obligation or a present obligation in respect of which the likelihood of outflow of resource is remote, no provision or disclosure is made.

n) Use of Estimates: The preparation of financial statements in conformity with Indian GAAP requires the management to make judgements,

estimates and assumptions that affect the reported balances of assets and liabilities and disclosure of contingent liabilities, at the end of the accounting year and reported amounts of revenue and expenses during the year. Although these estimates are based on the management’s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.

4. SHARE CAPITAL(` in Lakh)

Particulars 31st Mar 2016 31st Mar 2015Authorised Capital 14,60,50,000 (Previous year 14,00,50,000) equity shares of ` 10/- each 14,605.00 14,005.00 10,000 preference shares of ` 10/- each 1.00 1.00

14,606.00 14,006.00 For increase in Authorised Capital pursuant to scheme of amalgamation - see note no.30 Issued, subscribed and fully paid up shares 9,64,57,754 equity shares of ` 10/- each 9,645.78 9,645.78 Less: 2,95,001 Equity Shares of ` 10/- each, issued to ESOP Trust but not allotted to employees (see note no. 34) 29.50 29.50 Adjusted Issued, subscribed and paid-up Capital 9,616.28 9,616.28

a) Reconciliation of the equity shares outstanding at the beginning and at the end of the reporting period(` in Lakh)


At the beginning of the year 96,162,753 9,616.28 96,146,174 9,614.62 Add: Issued during the year under ESOP - - 16,579 1.66

96,162,753 9,616.28 96,162,753 9,616.28 Less: Interest in INOX Benefit Trust - shares of Company held by the Trust (see note no. 31) 4,350,092 435.01 4,350,092 435.01

91,812,661 9,181.27 91,812,661 9,181.27

b) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of `10 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to approval of the shareholders in the Annual General Meeting. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive the remaining assets of the Company, in proportion to their shareholding.

c) Equity shares held by holding /ultimate holding company (` in Lakh)


Gujarat Fluorochemicals Limited (holding company) 46,386,467 4,638.65 46,386,467 4,638.65 INOX Leasing & Finance Limited (ultimate holding company) 587,461 58.75 587,461 58.75

The shareholders of the Company have passed a resolution at the Annual General Meeting held on 23rd August 2013 amending the Articles of Association of the Company entitling Gujarat Fluorochemicals Limited (GFL) to appoint majority of directors on the Board of the Company if GFL holds not less than 40% of the paid-up equity capital of the Company and accordingly, the Company is a subsidiary of GFL.

d) Shares issued for consideration other than cash during the period of five years immediately preceding the reporting date:

During the year ended 31st March 2014, 3,45,62,206 shares of ` 10 each, fully paid-up were, issued to the shareholders of erstwhile Fame India Limited, pursuant to the Scheme of Amalgamation.


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e) Details of shareholders holding more than 5% equity shares in the Company (` in Lakh)

Particulars 31st Mar 2016 31st Mar 2015 Nos. % Nos. %

Gujarat Fluorochemicals Limited 46,386,467 48.09% 46,386,467 48.09%

f) Shares reserved for issue under options For details of shares reserved for issue under the employee stock option (ESOP) plan of the Company, see note no. 34

5. RESERVES & SURPLUS(` in Lakh)

Particulars 31st Mar 2016 31st Mar 2015Capital redemption reserveBalance as per last Balance Sheet 0.10 0.10 Securities premium AccountBalance as per last Balance Sheet 25,766.91 25,766.91 Add: Addition on amalgamation (see note no. 30) 2,340.45 - Balance as at the end of the year 28,107.36 25,766.91 Less: Premium on shares issued to ESOP Trust but not allotted to employees 14.75 14.75 Net balance at the end of the year 28,092.61 25,752.16 Employee stock options outstandingBalance as per last Balance Sheet - 6.32 Less: On account of options granted/lapsed/exercised and amortisation of value of stock options (net)

- (6.32)

Balance as at the end of the year - - Amalgamation reserveBalance as per last Balance Sheet 750.66 750.66 Less: Deduction on account of amalgamation (see note no. 30) (750.66) - Balance as at the end of the year - 750.66 General reserveBalance as per last Balance Sheet 5,400.00 5,400.00 Add: Addition on amalgamation (see note no. 30) 100.00 - Less: Deduction on account of amalgamation (see note no. 30) (2,717.45) - Balance as at the end of the year 2,782.55 5,400.00 Other reserveReserve on sale of Treasury Shares (see note no. 31)Balance as per last Balance Sheet 14,872.93 (458.34)Profit on sale of treasury shares during the year - 15,331.27 Less: Deduction on account of amalgamation (see note no. 30) (14,872.93) - Balance as at the end of the year - 14,872.93 Surplus in the Statement of Profit and Loss Surplus as per last Balance Sheet 14,493.94 13,002.69 Less: Adjustment on account of carrying amount of fixed assets as at 1st April, 2014 (see note no. 33)

- (512.56)

Less: On account of amalgamation (see note no. 30) (391.54) - Add: Profit for the year 7,749.00 2,003.81 Balance as at the end of the year 21,851.40 14,493.94 Total 52,726.66 61,269.79


6. LONG-TERM BORROWINGS

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Term Loans from banks (secured) 7,942.56 6,400.12 Inter-corporate deposits - from holding company 16,249.00 16,249.00 Total borrowings 24,191.56 22,649.12 Less: Current maturities disclosed under note no. 12 "Other current liabilities" (2,498.56) (2,598.56)Total 21,693.00 20,050.56

Nature of Security and terms of repayment for secured borrowings:a) Term loans from Axis Bank amounting to ` 3,942.56 Lakh (previous year ` 6,400.11 Lakh) carry interest @ bank base rate

+ 0.25 % p.a. which presently is 9.70%. The loans are secured by mortgage of immovable property situated at Vadodara and Anand and first exclusive charge on all movable fixed assets and current assets of the new multiplexes/property financed by the said term loans and escrow of entire cash flows relating to such multiplexes. The repayment schedules are as under:

Particulars OutstandingAmount (` in Lakh)

Repayment terms

Term Loan 1 1,498.56 Repayable in 16 equal quarterly instalments of ` 374.64 Lakh each beginning from 30th June 2013

Term Loan 2 2,444.00 Repayable in 16 equal quarterly instalments of ` 250.00 Lakh each beginning from 1st October 2014

b) Term loans from HDFC Bank amounting to ` 4,000.00 Lakh (previous year ` Nil) carry interest @ bank base rate which presently is 9.30% and is secured by mortgage of immovable property situated at Mumbai and first exclusive charge on all movable fixed assets of the new multiplexes/property financed by the said term loan. The loan is repayable in 16 equal quarterly instalments beginning from 30th June, 2017.

Terms of repayment for unsecured borrowings: The inter-corporate deposits are repayable in 6 to 8 years from the date of respective deposits and carry interest @ 10%. 7. DEFERRED TAX LIABILITIES (NET)

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015 Deferred tax liabilities On account of difference between book and tax depreciation 1,473.96 3,196.77 Total Liabilities 1,473.96 3,196.77 Deferred tax assets Expenditure allowable on payment basis under Income-tax Act, 1961 765.46 687.80 Amalgamation 35.38 50.53 Provision for doubtful debts and advances 87.28 25.97 Total Assets 888.12 764.30 Net deferred tax liabilities 585.84 2,432.47


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8. OTHER LONG-TERM LIABILITIES

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Security deposits received 159.17 129.64 Retention money 76.20 45.70 Creditors for capital expenditure - 257.56 Total 235.37 432.90

9. PROVISIONS(` in Lakh)

Particulars Long-term Short-term31st Mar 2016 31st Mar 2015 31st Mar 2016 31st Mar 2015

For employee benefits (see note no. 44)Gratuity 565.26 436.52 67.94 72.16 Leave benefits 212.70 176.88 87.66 76.81 For expenses (see note no. 47)Municipal tax - - 235.80 183.00 MVAT - - - 39.38 Service tax - - 1,042.44 1,042.44 for Taxation (net of payments) - - 209.06 85.20

777.96 613.40 1,642.90 1,498.99 Share of Joint Venture - - 51.04 51.04 Total 777.96 613.40 1,693.94 1,550.03

10. SHORT TERMS BORROWINGS

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Loans repayable on demand from banks (secured) - Bank overdraft 2,512.65 1,410.06 - Inter corporate deposits - 59.85 Total 2,512.65 1,469.91

a) Bank overdraft is secured against first charge on the entire current assets of the Company, both present and future; and extension of first charge by way of mortgage of property at Vadodara and Anand, Gujarat.

b) During the year, the Company had raised short term funds by issue of Commercial Papers (CP). Discount on CP varied between 7.55% to 8.05% and maximum balance outstanding during the year was ` 3,000 Lakh (previous year ` 32,000 Lakh).

c) Inter-corporate deposit is repayable on demand and carries interest @ 12%


11. TRADE PAYABLES

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Trade payables- Dues to Micro and Small Enterprises (see note no. 42) 5.39 1.80 - Dues to others 7,324.21 7,837.94

7,329.60 7,839.74 Share of Joint Venture 1.23 1.74 Total 7,330.83 7,841.48

12. OTHER CURRENT LIABILITIES

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Current maturities of long-term debt (from note no.6) 2,498.56 2,598.56 Interest accrued and due on borrowings 38.48 119.80 Interest accrued but not due on long term liabilities 2.61 4.40 Income Received in advance 762.21 742.02 Unclaimed dividend (see note below) - 2.15 Advances from customers 543.54 551.81 Statutory dues and taxes payable 1,297.60 916.06 Creditors for capital expenditure 1,449.82 3,209.91 Payable towards purchase of shares of erstwhile Satyam Cineplexes Ltd 363.92 425.22 Retention Money 310.25 264.97 Security Deposit 163.54 202.49 Dues to employees 351.44 546.75 Other Payables 1,071.06 537.50


Note: In respect of amounts mentioned under unclaimed dividends, the actual amount to be transferred to the Investor Education and Protection Fund shall be determined on the due date.


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Annual Report 1516

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. 33



14. CAPITAL WORK-IN-PROGRESS

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015 Capital work-in-progress 4,358.73 3,911.50 Pre-operative expenditure pending allocation 1,214.10 1,196.16 Total 5,572.83 5,107.66

Pre-operative expenditure pending allocation Opening Balance 1,196.17 1,014.72 Add: Expenses incurred during the year Salaries and wages 397.00 297.81 Contribution to provident and other funds 19.67 17.42 Staff welfare 5.65 3.37 Legal & professional fees and expenses 192.59 403.94 Travelling & conveyance 265.44 376.49 Insurance (net) 1.53 1.42 Power & fuel 14.56 45.95 Communication expenses 3.67 5.28 House keeping expenses 0.11 10.92 Outsourced personnel cost 8.38 24.49 Security expenses 81.84 69.12 Miscellaneous expenses 29.27 74.72 Borrowings costs 8.76 123.99

1,028.47 1,454.92 Less: Pre-operative Income earned during the year Miscellaneous income 2.40 12.15

2,222.24 2,457.49 Less: Capitalised/reclassified during the year 1,008.14 1,261.32 Closing balance 1,214.10 1,196.17

15. (a) NON-CURRENT INVESTMENTS (Non-trade, at cost, unquoted)

(` in Lakh)31st Mar 2016 31st Mar 2015

a) Investments in Government Securities 118.03 110.11 National Savings Certificates (Pledged with Government authorities and held in the name of directors/ex-director/employees ) (7.50) (39.48)Less: Current portion disclosed in note no. 15(b) 110.53 70.63

Total 110.53 70.63

145

Annual Report 1516


15. (b) CURRENT INVESTMENTS a) Investment in mutual funds (Non-trade, unquoted, at lower of cost and fair value)

(` in Lakh)

Particulars Face Value ` Nos. As at 31st Mar

2016

Nos. As at 31st Mar

2015

31st Mar 2016

31st Mar 2015

Taurus Liquid Fund-Regular Plan-Super Inst Growth

1,000 15320.18 39945 250.00 -

HDFC Liquid Fund-Growth 1,000 8413.77 - 250.00 - Birla Sun Life Cash Plus-Growth-Regular Plan 100 414681.34 - 1,001.00 601.89

1,501.00 601.89 b) Current portion of non-current Investment -

from note no. 15(a) 7.50 39.48 1,508.50 641.37

Share of Joint Venture 45.00 Total 1,553.50 641.37

16. LONG-TERM LOANS AND ADVANCES (unsecured, considered good, unless otherwise stated)

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Capital advances 65.30 55.03 Security deposits - Considered good 11,693.99 10,475.57 - Considered doubtful 311.88 311.88

12,005.87 10,787.45 Advances recoverable in cash or in kind - Considered good 1,015.21 622.25 - Considered doubtful 84.77 -

1,099.98 622.25 Entertainment tax refund claimed 3,335.01 2,998.37 Income Tax paid (net of provisions) 297.35 430.88 MAT credit entitlement 2,571.44 3,142.11 Electricity charges refund claimed - see note no. 36(i) 389.83 389.83

19,764.78 18,425.92 Less: Provision for doubtful advances & deposits 396.65 311.88


17. OTHER NON-CURRENT ASSETS(` in Lakh)

Particulars 31st Mar 2016 31st Mar 2015Non-current bank balances (from note no. 20) 150.47 220.10 Amount recoverable towards claim - see note no. 36(a)(i) 932.44 - Interest accrued: on long term investments 21.75 12.59 on bank fixed deposits 14.61 6.40 others 161.72 157.16 Total 1,280.99 396.25


18. INVENTORIES (for basis of valuation - see note no. 3(f))

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Food & Beverages 422.09 503.63 Stores, Spares & Fuel 262.78 255.48 Total 684.87 759.11

19. TRADE RECEIVABLES (unsecured, considered good, unless otherwise stated)

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Considered Good

Outstanding for a period exceeding six months 1,821.12 1,811.83 Others 3,528.70 4,420.05

5,349.82 6,231.88 Considered Doubtful

Outstanding for a period exceeding six months 252.18 76.42 5,602.00 6,308.30

Less: Provision for doubtful trade receivables 252.18 76.42 Total 5,349.82 6,231.88

20. CASH & BANK BALANCES

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Cash and Cash equivalentsBalances with banks

In Current accounts 2,013.54 729.06 Cheques on hand 14.15 29.72

2,027.69 758.78 Cash on Hand 230.29 210.52

2,257.98 969.30 Share of Joint Venture 4.22 50.62 Total cash and cash equivalents 2,262.20 1,019.92 Other bank balancesin Unpaid dividend accounts - 2.15 Deposits with original maturity for more than 3 months but less than 12 months 313.48 298.61 Deposits with original maturity for more than 12 months 282.52 243.74 Total other bank balances 596.00 544.50 Total cash and bank balances 2,858.20 1,564.42 Less: Amount disclosed under note no. 17 "Other non-current assets" (150.47) (220.10)Total 2,707.73 1,344.32 Other bank balances include margin money deposits given as security as under:Deposits with original maturity for more than 3 months but less than 12 months 28.06 28.06 Deposits with original maturity for more than 12 months 197.37 243.74

225.43 271.80

147

Annual Report 1516


21. SHORT-TERM LOANS & ADVANCES (unsecured, considered good, unless otherwise stated)

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Prepaid expenses 329.52 223.10 Security deposits 31.21 30.96 Balance in Cenvat Credit account 34.30 27.26 Advances recoverable in cash or in kind 200.81 256.30 Advances to suppliers- Considered good 486.81 530.44 - Considered doubtful 35.81 -

522.62 530.44 Less: Provision for doubtful advances 35.81 -

486.81 530.44 Total 1,082.65 1,068.06

22. OTHER CURRENT ASSETS

(` in Lakh) Particulars 31st Mar 2016 31st Mar 2015Fixed assets held for disposal 116.15 131.14 Interest accrued on bank fixed deposits 6.40 5.93 on long term investments 4.53 19.51 others 19.68 20.23 Total 146.76 176.81

23. REVENUE FROM OPERATIONS

(` in Lakh) Particulars 2015-2016 2014-2015

a) Sale of services: Box Office Revenue 90,493.78 67,307.82 Conducting Fees 1,982.51 1,696.56 Advertising Income 9,101.32 8,149.03 Management Fees 254.44 205.58 Parking Charges 129.26 126.88

101,961.31 77,485.87 b) Sale of products

Food & beverages 26,563.14 19,103.02 Sale of Power 6.20 6.81

26,569.34 19,109.83 c) Refund of entertainment tax for earlier years - see note no. 37(b) - 616.74 d) Other operating revenue 4,737.94 4,468.85

Total 133,268.59 101,681.29


24. OTHER INCOME

(` in Lakh) Particulars 2015-2016 2014-2015 Interest On bank fixed deposits 47.44 51.04 On long-term investments 10.66 10.85 On income-tax refunds 35.12 31.70 On Inter-corporate deposits 5.29 16.67 Other Interest 45.02 78.51

143.53 188.77 Gain on sale of current investments 143.06 376.57 Liabilities and provisions, no longer required, written back 121.33 237.26 Bad debts/deposits written off recovered 18.00 8.43 Miscellaneous Income 6.53 0.28

432.45 811.31 Share of Joint Venture 0.01 15.20 Total 432.46 826.51

25. EXHIBITION COST

(` in Lakh) Particulars 2015-2016 2014-2015 Distributors' share 31,479.39 24,148.37 Other exhibition cost 964.33 732.90 Share of joint venture investors (see note below) 86.27 51.17 Total 32,529.99 24,932.44

The Company has entered into joint venture agreements for management of multiplex operations for few multiplexes / single screen theatres. These joint venture investors do not have any control over these operations.

26. COST OF FOOD AND BEVERAGES

(` in Lakh) Particulars 2015-2016 2014-2015 Opening Stock 503.63 486.71 Add : On acquisition - 44.87 Add: Purchases 6,529.14 4,926.96

7,032.77 5,458.54 Less: Closing stock 422.09 503.63 Cost of Food and Beverages 6,610.68 4,954.91

27. EMPLOYEE BENEFITS EXPENSE

(` in Lakh) Particulars 2015-2016 2014-2015 Salaries and Wages 6,452.48 5,732.49 Contribution to Provident and other Funds 453.51 416.60 Expense on ESOP (net) - 1.36 Gratuity 179.97 166.86 Staff Welfare Expenses 380.16 264.25 Total 7,466.12 6,581.56

149

Annual Report 1516


28. FINANCE COSTS

(` in Lakh) Particulars 2015-2016 2014-2015 Interest on borrowings 2,272.60 2,374.08 Discounting charges on commercial paper 84.23 1,181.96 Interest on deferred credit 68.10 182.54 Other interest 10.11 61.14 Other borrowing costs 6.72 61.28 Total 2,441.76 3,861.00

29. OTHER EXPENSES

(` in Lakh) Particulars 2015-2016 2014-2015 Outsourced personnel cost 3,599.45 2,616.23 Power & fuel 8,623.59 7,253.04 Water charges 233.63 171.58 Property rent and conducting fees 15,855.57 13,426.91 Common facility charges 4,850.91 4,151.29 Rates & taxes 739.79 718.25 Service tax 3,825.05 3,049.90 Travelling & conveyance 619.46 611.44 Communication expenses 390.19 323.70 Printing & stationary 465.21 379.16 Advertising & sales promotion 1,190.03 984.13 House keeping expenses 2,031.15 1,642.55 Security expenses 1,937.70 1,635.43 Repairs & maintenance - buildings 429.59 191.78 Repairs & maintenance - plant and equipments 2,148.62 1,318.89 Repairs & Maintenance - others 764.50 341.32 Legal & professional fees & expenses 933.62 705.28 Director sitting fees 15.40 14.40 Insurance 145.95 135.70 Amalgamation expenses 30.19 12.43 Loss of retirement/disposal of fixed assets (net) 183.76 4.89 Provision for diminution in value of assets held for disposal 14.98 17.03 Bad debts and remissions 115.32 - Deposits and advances written off 1.84 40.57 Provision for doubtful debts 178.50 23.06 Provision for doubtful advances and deposits 120.58 311.88 Net loss on foreign currency transactions and translation 23.60 2.35 " Corporate Social Responsibility (CSR) expenditure - see note no. 48 "

5.00 45.31

Miscellaneous expenses 815.55 651.42 50,288.73 40,779.92

Share of Joint Venture 1.01 10.20 Total 50,289.74 40,790.12


30. ACQUISITION OF SATYAM CINEPLEXES LIMITED AND IT AMALGAMATION WITH THE COMPANY a. During the previous year, the Company had acquired 100% of the equity shares in Satyam Cineplexes Limited (“SCL”)

and consequently SCL had become a wholly owned subsidiary of the Company with effect from 8th August, 2014. During the current year, pursuant to the Scheme of Amalgamation (“the Scheme”) under Section 391 to 394 of the Companies Act 1956, sanctioned by the Hon’ble High Court of Delhi vide order dated 10th February 2016, SCL has been amalgamated with the Company with effect from 8th August, 2014 (“the Appointed Date”). The Scheme has become effective on 23rd March 2016 viz. the date on which the certified copy of the order of the Delhi High Court sanctioning the Scheme is filed with the Registrar of Companies, Gujarat and Registrar of Companies, Delhi. The Scheme has accordingly been given effect to in the accounts. Accordingly, all the movable and immovable properties including plant and machinery, equipments, furniture, fixtures, vehicles, stocks and inventory, leasehold assets and other properties, etc. and all the debts, liabilities, duties and obligations including contingent liabilities of SCL are vested in the Company retrospectively with effect from 8th August, 2014. Since SCL was wholly owned by the Company, no shares were exchanged on its amalgamation with the Company.

b. Nature of business of the amalgamating company: SCL was engaged in the business of operating multiplex cinema theatres in India.

c. The amalgamation is accounted for under the “Pooling of Interest” method as prescribed in Accounting Standard (AS) 14 ‘Accounting for Amalgamation’, as notified under Section 133 of the Companies Act, 2013. Accordingly, the assets, liabilities and reserves of SCL as at 8th August, 2014 have been recorded at their existing carrying amounts and in the same form as at the date of amalgamation. The amount of share capital of SCL and investment held by the Company in SCL is adjusted against each other and as per the Scheme, the difference has been adjusted against the Amalgamation Reserve, Reserve on sale of Treasury Shares and General Reserve.

The effect of the Scheme as given in the accounts, in accordance with the Scheme, is summarized as under:

(` in Lakh)Particulars AssetsFixed assets (net) and capital work-in-progress 5560.69Loans and advances and other assets 1301.17Inventories 80.20Trade receivables 476.33Cash and bank balances 306.38Gross Assets 7724.77LiabilitiesDeferred tax liabilities 128.78Trade payables 3823.16Other liabilities and provisions 1451.37Gross liabilities 5403.31Net assets taken over 2321.46Less: Cost of Company’s investment in SCL 18800.59Excess of cost of Company’s investment in SCL over the net assets taken over 16479.13Adjustment to Reserves as per the SchemeAdd: Reserves & Surplus of SCL on the appointed date recorded at their existing carrying amountsSecurities Premium 2340.45General Reserve 100.00Deficit in the Statement of Profit and Loss (578.54) 1861.91Sub-total 18,341.04Less: Adjusted against Reserves of the Company as per the SchemeAmalgamation Reserve 750.66Reserve on sale of Treasury Shares 14872.93General Reserve 2717.45 (18341.04)

151

Annual Report 1516


d. The breakup of amount of deficit in the Statement of Profit and Loss on account of amalgamation is as under:

(` in Lakh)Particulars Deficit in the Statement of Profit and Loss on the appointed date (578.54)Reduction in provision for taxation for the year ended 31st March 2015 consequent to the amalgamation of SCL 187.00Net amount (391.54)

e. As per the terms of the Scheme, the authorised share capital of SCL has been merged with that of the Company.

31. TREASURY SHARES Pursuant to the Composite Scheme of Amalgamation of Company’s subsidiary Fame India Limited (“Fame”) and subsidiaries

of Fame with the Company, which was operative from 1st April 2012, the Company had allotted 3,45,62,206 equity shares to the shareholders of the transferor companies on 10th July 2013, including 2,44,31,570 equity shares to INOX Benefit Trust (“Trust”) towards shares held by Company in Fame. These shares (“Treasury Shares”) are held by the Trust exclusively for the benefit of the Company.

In terms of Accounting Standard (AS31) ‘Financial Instruments’ (which is not yet mandatory), internationally generally accepted accounting practices and for more appropriate presentation of the financial statements, the Company’s interest in the Trust (at cost), being akin to Treasury Shares, in accordance with their substance and economic reality, is deducted from Shareholders’ Fund. Any profit or loss arising from sale of Treasury Shares by the Trust is being recorded separately as ‘Reserve on sale of Treasury Shares’ under Reserves and Surplus, being transactions relating to the capital of the Company. Accordingly, during the previous year the profit of ` 15331.27 Lakh on sale of 1,55,81,478 Treasury Shares was directly recognised in ‘Reserve on sale of Treasury Shares’ under Reserves and Surplus.

The balance equity shares 43,50,092 of the Company, held by INOX Benefit Trust, being Treasury Shares, are excluded while computing the Earnings Per Share.

32. EXCEPTIONAL ITEMS:

(` in Lakh)Particulars 2015-2016 2014-2015Net value of assets written off in respect of one multiplex, the operations of which are terminated during the year

352.92 Nil

Provision for additional bonus payable in respect of earlier year pursuant to retrospective amendment made by The Payment of Bonus (Amendment) Act, 2015

143.10 Nil

Donation to an electoral trust and concerns affiliated to political parties Nil 60.00Total 496.02 60.00

33. CHANGE IN THE ESTIMATE OF USEFUL LIFE OF FIXED ASSETS DURING THE YEAR ENDED 31ST MARCH 2015:

During the previous year, the Group had adopted the useful lives of various fixed assets as specified in Schedule II of the Companies Act, 2013, with effect from April 1, 2014, as against the useful lives adopted earlier as per Schedule XIV to the Companies Act, 1956. The carrying amount of fixed assets, where the remaining useful life as at 1st April 2014 as per Schedule II was Nil, aggregating to ̀ 512.56 Lakh (net of deferred tax credit of ̀ 264.00 Lakh), was recognized in the opening balance of retained earnings in the previous year.

34. EMPLOYEES’ STOCK OPTION PLAN In the year ended 31st March 2006, the Company had issued 500,000 equity shares of ̀ 10 each at a premium of ̀ 5 per share

to INOX Leisure Limited – Employees’ Welfare Trust (“ ESOP Trust”) to be transferred to the employees of the Company under the scheme of ESOP framed by the Company in this regard. The Company has provided finance of ` 75 Lakh to the ESOP Trust for subscription of these shares at the beginning of the plan.


As per the Guidance Note on Accounting for Employee Share-based Payments issued by the Institute of Chartered Accountants of India, shares allotted to the ESOP Trust but not transferred to employees is required to be reduced from Share Capital and Reserves. Out of the 500,000 equity shares allotted to the Trust, 204,999 shares have been transferred to employees. Accordingly, for the balance number of shares, the Company has reduced the Share Capital by the amount of face value of equity shares and Share Premium Account by the amount of share premium on such shares. The Company has also given effect to the above in the calculation of its Basic and Diluted earnings per share.

There are no outstanding stock options as at 31st March 2016. The compensation costs of stock options granted to employees under the Employees’ Stock Option Plan were accounted by

the Company using the intrinsic value method. In accordance with the Guidance Note on Accounting for Employee Share-based Payments issued by the Institute of Chartered Accountants of India, the accounting value of options was amortized over the vesting period. Consequently, ‘Employee benefits expense’ in Note no. 27 includes ` Nil (previous year ` 1.36 Lakh) being the amortization of employee compensation. Had the Company adopted fair value method in respect of options granted, the employee compensation cost in the previous year would have been higher by ` 0.97 Lakh, profit before tax lower by ` 0.97 Lakh and the basic and diluted earnings per share would have been lower by less than Re. 0.01.

35. IN RESPECT OF TAXATION MATTERS a) The Group’s contention that the amount of entertainment tax exemption availed for some of its multiplexes is a capital

receipt has been accepted by various appellate authorities and Hon’ble High Court of Judicature at Gujarat. Provision for income tax, till the year ended 31st March 2015, was made on this basis, to the extent the entertainment tax exemption is held as capital receipt for such multiplexes. The matter is presently pending before the Hon’ble Supreme Court.

b) In view of the assessment and appellate orders received by the Group, the tax liability for earlier years and the written

down value of fixed assets as per the Income-tax Act, 1961 is recomputed and consequential reduction in taxation of earlier years is recognized in the Statement of Profit and Loss as under:

(` in Lakh)Particulars 2015-2016 2014-2015Income-tax - (325.78)Deferred tax (1486.00) -MAT Credit entitlement (902.33) (585.41)Net credit (2388.33) (911.19)

36. CONTINGENT LIABILITIES: a. Claims against the Group not acknowledged as debt – ` 7358.26 Lakh (previous year ` 7235.70 Lakh), comprising of:

i. The Company had issued termination notice for one of its proposed multiplexes seeking refund of security deposit and reimbursement of the cost of fit-outs incurred by the Company, aggregating to ` 932.44 Lakh. The party has made a counter claim of ` 6,943.44 Lakh (previous year ` 6943.44 Lakh) towards rent for lock in period and other costs which is included in the amount above. At present the matter is pending before the Arbitrator and hence the amount of ` 932.44 Lakh is carried forward as amount recoverable towards claim in ‘Other non-current assets’.

ii. In the arbitration proceedings in respect of termination notice of MOU for another proposed multiplex, the arbitrator has awarded the matter against the Company and directed the Company to pay ` 116.36 Lakh towards rent for the lock in period, which is included in the amount above. Further, the arbitrator has also directed the Company to pay the amount of difference between the rent payable by the Company as per the MOU and the amount of actual rent received by the other party from their new tenant. The differential amount is presently not determinable. The Company has challenged the arbitration award before the Hon’ble High Court of judicature at Delhi and the same is pending.

iii. Other claims are by owners of the multiplex premises which are under negotiations with the respective parties.

153

Annual Report 1516


b. Property Tax matters – ` 605.08 Lakh (previous year ` 569.72 Lakh)

The quantum of property tax levied in case of one multiplex is disputed and the matter is pending before Court of Small Causes and Hon’ble High Court of judicature at Bombay. Estimated provision for the same is made by the Company – see Note no. 47.

c. Entertainment Tax matters – ` 2937.69 Lakh (previous year ` 2448.10 Lakh). This includes:

i. Demand of ̀ 2,199.71 Lakh (previous year ̀ 1,941.22 Lakh) in respect of some multiplexes pertaining to exemption period and the same is contested by way of appeal before appropriate authorities.

ii. Demand of ` 602.37 Lakh (previous year ` 477.34 Lakh) in respect of one multiplex where the eligibility for exemption from payment of entertainment tax is rejected and the same is contested by way of appeal before appropriate authorities.

iii. Other demands are mainly in respect of levy of entertainment tax on service charges and convenience fee collected.

d. Service Tax matters – ` 17,388.08 Lakh (previous year ` 7,170.09 Lakh). This includes:

i. Amount of ̀ 15,027.63 Lakh (previous year ̀ 5,577.97 Lakh) is in respect of levy of service tax on film distributor’s’ share paid by the Group and the matter is being contested by way of appeal / representation before the appropriate authorities.

ii. Amount of ` 2,360.45 Lakh (previous year ` 1,502.00 Lakh) for which the Company has received a show cause notice regarding levy of service tax on sale of food and beverages in multiplex premises and the Group has filed replies to these show cause notices.

e. Stamp duty matter – ` 263.81 Lakh (previous year ` 263.81 Lakh)

Authority has raised the demand for non-payment of stamp duty on Leave & License Agreement in respect of one of the multiplexes, holding the same as lease transaction. Stay has been granted and the matter is pending before Board of Revenue.

f. Custom duty matter – ` 4.36 Lakh (previous year ` 4.36 Lakh)

The Company has received a notice in respect of custom duty payable on import of cinematographic films. The amount of duty is not quantified by the authorities and the company has filed an appeal before the Appellate Tribunal and the same is pending hearing.

g. VAT demand – ` 261.87 Lakh (previous year ` 261.87 Lakh). This includes:

Demand of ` 237.06 Lakh (previous year ` 237.06 Lakh) pursuant to reassessment order for the year 2008-09. The Company has filed an appeal and stay is granted on payment of ` 2 Lakh.

h. Income-tax matters – ` 235.64 Lakh (previous year ` 19.48 Lakh). This includes:

Assessment dues for assessment year 2013-14 of ̀ 216.16 Lakh (previous year ̀ Nil) and penalty levied for assessment year 2010-11 of ̀ 19.48 Lakh (previous year ̀ 19.48 Lakh), which is being contested by the Company before appellate authorities.

i. The Company may be required to charge additional cost of ` 389.83 Lakh (previous year ` 389.83 Lakh) towards electricity from 1st June 2007 to 31st March 2010 pursuant to the increase in the tariff in case the appeal made with Maharashtra Electricity Regulatory Commission ‘MERC’ by the Company through the Multiplex Association of India is rejected and the case filed in the Supreme Court by one of the electricity supplier against the order of the Appellate Tribunal for Electricity, dated 19 January 2009, for change in category, in favor of the appeal made by the Multiplex Association of India is passed in favor of the electricity supplier. The Company has paid the whole amount to the respective authorities under protest (which is included in ‘Long-Term Loans and Advances’)

j. Group’s share in the contingent liability of Joint Venture – Income-tax demand – ̀ 5.60 Lakh (previous year ̀ 5.60 Lakh).

In respect of above matters, no provision is considered necessary as the Group expects favourable outcome. Further, it is not possible for the Group to estimate the timing of further cash outflows, if any, in respect of these matters.


37. In respect of Entertainment-tax exemption claimed and its treatment in these accounts:

a. The Entertainment Tax exemption in respect of some of the Multiplexes of the Company has been accounted on the basis of eligibility criteria as laid down in the respective Schemes but is subject to final Orders yet to be received from respective authorities. Accordingly, the Company has not charged ` 1184.00 Lakh to the Statement of Profit and Loss for the year ended 31st March, 2016 (previous year ` 923.57 Lakh) being the Entertainment Tax in respect of such Multiplexes and cumulative amount as on 31st March, 2016 is ` 5281.89 Lakh (previous year ` 4575.19 Lakh).

b. In respect of two multiplexes being operated by the Company in Uttar Pradesh: In view of the revised eligibility norms notified during the previous year, these multiplexes became eligible for exemption from payment of entertainment tax, w.e.f. the date of commencement of commercial operations. Accordingly, the amount of ` 616.74 Lakh, being entertainment tax paid in respect of these two multiplexes in earlier years, was credited to the Statement of Profit and Loss in the previous year.

38. The arbitration award in the matter of disputed recoveries pertaining to one of the multiplex of the Company has been received in favour of the Company and the arbitrator has further granted interest claimed on the unpaid amount at the rate of 15% p.a. The Company has accordingly accounted interest of ` 4.56 Lakh (previous year ` 18.24 Lakh). Total amount of interest receivable upto 31st March, 2016 is ` 170.91 Lakh (previous year ` 166.30 Lakh). The said award has been challenged before the District Court and the matter is pending.

39. Commitments:

a. Capital commitments: Estimated amounts of contracts remaining to be executed on capital account and not provided for, net of advances - `

4399.78 Lakh (previous year ` 1791.88 Lakh)

b. Other commitments: The exemption from payment of Entertainment Tax in respect of multiplexes of the Group, which are eligible for

such exemption, is subject to fulfillment of the terms and conditions of the respective State Government policies issued in this regard. The amount of Entertainment Tax exemption availed so far by the Company, which is liable to be paid if the relevant multiplex ceases operations prior to completing the minimum period of operations in terms of the respective policies of the States – ` 14,293.47 Lakh (previous year ` 15,889.77 Lakh). Out of this, an amount of ` 1,112.67 Lakh (previous year ` 1,012.64 Lakh) is included in para 36(c) above, being entertainment tax disputes pertaining to exemption period.

40. The Company has, in May 2015, detected a fraud perpetrated by one of its employees in respect of travel bills from travel agencies, who were otherwise booking air tickets for bona-fide travel undertaken by employees and other persons for and on behalf of the Company. A confession statement has been given by the said employee. The Company has filed a First Information Report (FIR) with the Police Station and terminated the services of the employee immediately. At present the matter is under further investigation by the Police. The estimate of amount involved, as assessed by the Company, is ̀ 418.30 Lakh which has already been charged to the statement of profit and loss in respective years.

41. Foreign currency exposures not hedged as at Balance Sheet date:

Particulars 31 Mar 2016 (USD in Lakh)

31 Mar 2015 (USD in Lakh)

Creditors for capital goods 4.13 39.03Interest outstanding on above 0.03 0.07

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42. Particulars of dues to Micro, Small and Medium Enterprises under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act):

(` in Lakh)Particulars 2015-2016 2014-2015Principal amount due to suppliers under MSMED Act at the year end 5.39 1.80Interest accrued & due to suppliers under MSMED Act on the above amount, unpaid at the year end

0.62 0.24

Payment made to suppliers (other than interest) beyond the appointed day during the year

31.25 19.99

Interest paid to suppliers under section 16 of MSMED Act during the year 0.00 0.00Interest due & payable to suppliers under MSMED Act for payments already made 0.81 0.44Interest accrued & remaining unpaid at the end of the year to supplier under MSMED Act

6.18 4.75

The above information has been disclosed in respect of parties which have been identified on the basis of the information available with the Group.

43. The Group significant leasing arrangements are in respect of :-

a. The Group is operating some of the multiplexes under operating lease / business conducting arrangement. These arrangements are for an initial period of 9-25 years with a minimum lock-in period of 3-10 years and the agreements provide for escalation after pre-determined periods. Lease payments of ` 15760.60 Lakh (previous year ` 13415.64 Lakh) are included in ‘Property Rent and Conducting Fees’ in Note no. 29 to the Statement of Profit and Loss.

The future minimum payments under these arrangements are as under:

(` in Lakh)Particulars 2015-2016 2014-2015Not later than one year 16,270.85 13,299.98Later than one year and not later than five years 56,748.41 46,059.49Later than five years 590,679.54 1,15,983.71Total 663,698.81 1,75,343.18

b. In respect of operating leases for office premises/godowns: The arrangements range between 11 months to 36 months and are usually renewable by mutual consent on mutually agreeable terms. Lease payments of ` 94.97 Lakh (previous year ` 11.27 Lakh) are included in ‘Property Rent and Conducting Fees’ in Note no. 29 to the Statement of Profit and Loss.

44. Employee Benefits:

a) Defined Contribution Plans: Contribution to Provident Fund of ` 409.28 Lakh (previous year ` 366.20 Lakh) is recognized as an expense and included in ‘Contribution to Provident & Other Funds’ in the Statement of Profit and Loss and ` 19.58 Lakh (previous year ` 17.35 Lakh) is included in pre-operative expenses.


b) Defined Benefit Plans: The amounts recognized in respect of Gratuity and Leave Encashment are as under:(` in Lakh)

Particulars Gratuity Leave Encashment2015-2016 2014-2015 2015-2016 2014-2015

1. Change in Benefit ObligationLiability at the beginning of the year 508.68 344.01 210.43 143.10Addition on acquisition during the year - 45.21 - 21.89Interest Cost 39.61 31.91 16.39 12.41Current Service Cost 115.30 125.47 78.13 126.91Benefit paid (55.45) (47.40) (49.63) (41.86)Actuarial (Gain)/Loss 25.06 9.48 (12.39) (52.02)Actuarial Liability at the end of the year 633.20 508.68 242.93 210.43Add: Short term leave liability - - 57.43 43.26Liability at the end of the year 633.20 508.68 300.36 253.692. Expenses recognized in the Statement of Profit and LossCurrent Service Cost 115.30 125.47 78.13 126.91Interest Cost 39.61 31.91 16.39 12.41Actuarial (Gain)/Loss 25.06 9.48 (12.39) (52.02)Expenses recognized in the Statement of Profit and Loss 179.97 166.85 82.13 87.303. Actuarial AssumptionsDiscount Rate 7.70% 7.77% 7.70% 7.77%Salary Escalation Rate 7%Retirement Age 58 yearsWithdrawal Rates 10%Mortality IALM (2006-08) Ultimate Mortality Table

(` in Lakh) Particulars 2015-16 2014-154. Other disclosure: Experience adjustmentGratuityPresent value of defined benefit obligation 633.20 508.68Experience adjustment on plan liabilities – (gain)/loss 22.07 (27.40)Leave BenefitsPresent value of defined benefit obligation 242.93 210.43Experience adjustment on plan liabilities – (gain)/loss (13.54) (70.26)

The above defined benefit plans are unfunded. The estimate of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

45. Segment Information The Group operates in a single business segment viz. theatrical exhibition. All activities of the Group are in India and hence

there are no geographical segments.

46. Related Party Disclosure: (i) Where Control Exists a. Gujarat Fluorochemicals Limited – holding company b. INOX Leasing & Finance Limited – ultimate holding company

(ii) Other related parties with whom there are transactions: Fellow Subsidiary a. INOX Wind Limited – subsidiary of Gujarat Fluorochemicals Limited

Key Management Personnel (KMP) a. Mr. Pavan Kumar Jain – Director of the Company b. Mr. Alok Tandon - Chief Executive Officer of the Company

157

Annual Report 1516


Relatives of KMP a. Mr. Vivek Kumar Jain – brother of Mr. Pavan Kumar Jain b. Mr. Siddharth Jain – son of Mr. Pavan Kumar Jain

Enterprises over which KMP, or his relative, has significant influence a. INOX India Private Limited (earlier INOX India Limited)

46. Related Party Disclosure - continued

(iii) Particulars of transactions:

Particulars Holding/ultimate holding company

Key management personnel (KMP) / relatives of KMP

Fellow subsidiaries Enterprises over which KMP, or his relative, has


Total

A) Transactions during the year 2015-16 2014-15 2015-16 2014-15 2015-16 2014-15 2015-16 2014-15 2015-16 2014-151. Interest paid Gujarat Fluorochemicals

Limited 1,624.90 1624.90 - - - - - - 1,624.90 1624.90

INOX Leasing & Finance Limited

- 108.58 - - - - - - - 108.58

Total 1,624.90 1733.48 - - - - - - 1,624.90 1733.482. Remuneration paid Mr. Alok Tandon - - 93.96 97.65 - - - - 93.96 97.65 Total - - 93.96 97.65 - - - - 93.96 97.653. Sales and services Gujarat Fluorochemicals

Limited4.58 4.86 - - - - - - 4.58 4.86

INOX Wind Limited - - - - - 79.16 - - - 79.16 INOX India Limited - - - - - - 2.34 2.58 2.34 2.58 Total 4.58 4.86 - - - 79.16 2.34 2.58 6.92 86.604. Inter-corporate deposits

repaid INOX Leasing & Finance

Limited- 1100.00 - - - - - - - 1100.00

5. Sitting fees paid to director Mr. Pavan Kumar Jain - - 1.40 1.20 - - - - 1.40 1.20 Mr. Vivek Kumar Jain - - 1.00 1.80 - - - - 1.00 1.80 Mr. Siddharth Jain - - 1.20 1.60 - - - - 1.20 1.60 Total - - 3.60 4.60 - - - - 3.60 4.606. Lease Rent paid

Gujarat Fluorochemicals Limited

82.09 30.46 - - - - - - 82.09 30.46

7. Reimbursement of Expenses


23.42 - - - - - - - 23.42 -

B) Amounts Outstanding

1. Inter-corporate deposit payable


16249.00 16249.00 - - - - - - 16249.00 16249.00

2. Trade receivables

INOX Wind Limited - - - - - 43.20 - - - 43.20 INOX India Limited - - - - - - 0.27 0.37 0.27 0.37 Total - - - - - 43.20 0.27 0.37 0.27 43.573. Trade payable


0.93 5.78 - - - - - - 0.93 5.78


47. Particulars in respect of provision for expenses

(` in Lakh)Particulars 2015-2016 2014-2015a) In respect of municipal taxes payable for one of Group's multiplexes Opening Balance 183.00 200.20 Provided during the year 52.80 52.80 Paid during the year Nil 70.00 Closing balance 235.80 183.00b) Towards MVAT Opening Balance 39.38 39.61 Paid during the year 14.38 0.23 Reversed during the year 25.00 Nil Closing balance Nil 39.38c) For service tax on renting of immovable properties Opening Balance 1,042.44 1,042.44 Provided during the year Nil Nil Paid during the year Nil Nil Closing balance 1,042.44 1,042.44

48. Corporate Social Responsibility (CSR) (a) The gross amount required to be spent by the Group during the year towards Corporate Social Responsibility (CSR)

is ` 68.03 Lakh (previous year ` 62.44 Lakh).

(b) Amount spent during the year on:

(` in Lakh)Sr. No.

Particulars In cash Yet to be paid in cash

Total

(i) Construction/acquisition of any fixed assets Nil(Nil)

Nil(Nil)

Nil(Nil)

(ii) On purposes other than (i) aboveDonations

5.00(45.31)

Nil(Nil)

5.00(45.31)

Note: Figures in brackets pertain to previous year.

49. Prior period items included in ‘Miscellaneous expenses’: Reversal of sale of services - `142.71 Lakh (previous year ` Nil)

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Annual Report 1516

50. Calculation of Earnings per share :

(` in Lakh)Particulars 2015-2016 2014-2015Profit after tax as per statement of profit and loss (` in Lakh) 7,749.00 2003.81Weighted average number of equity shares used in computing basic earnings per shares (nos.)

91,812,661 91,809,663

Weighted average number of equity shares used in computing diluted earnings per shares (nos.)

91,812,661 91,809,663

Basic Earnings per share of ` 10/- each (`) 8.44 2.18Diluted Earnings per share of ` 10/- each (`) 8.44 2.18

Note: The shares of the Company held by INOX Benefit Trust (see note no. 31) being Treasury Shares, are excluded while computing the weighted average number of shares.






161

Annual Report 1516

INOX LEISURE LIMITED5th Floor, Viraj Towers, Western Express Highwasy, Andheri (East), Mumbai-400 093Phone +91 -22 4062 69 00 Fax +91 - 22 4062 69 99 E-Mail [email protected]

www.inoxmovies.com, Join us at App Store

INOX LEISURE LIMITED (CIN: L92199GJ1999PLC044045)

Registered Office: ABS Towers, Old Padra Road, Vadodara – 390 007.Telephone: 0265 6198111 | Fax: 0265 2310312

Website: www.inoxmovies.com | Email ID: [email protected]

ATTENDANCE SLIP(To be handed over at the entrance of Meeting Hall)

I certify that I am a registered Member /proxy for the registered Member of the Company.

I hereby record my presence at the 17th Annual General Meeting of the Company held at Maple Hall, Hotel Express Residency, 18/19, Alkapuri Society, Vadodara – 390 007 on Saturday, 24th September, 2016 at 12:00 noon.

Sr. No. :

Member’s Name and Address details

DP ID*

Client ID*

Folio No.

No. of Shares

* Applicable only for Investors holding shares in Electronic Form.

Note: Please fill in this attendance slip and hand it over at the ENTRANCE OF THE HALL. Members attending the Meeting are requested to bring their copies of the Annual Report with them

______________________________ Member’s/Proxy’s Signature

ELECTRONIC VOTING PARTICULARS

Members may please note the user id and password given below for the purpose of e-voting in terms of Section 108 of the Companies Act, 2013, read with Rule 20 of the Companies (Management and Administration), Rules, 2014, as amended. Detailed instructions for e-voting are given in the attached AGM Notice.

E VOTING SEQUENCE NUMBER (EVSN) USER ID SEQUENCE NUMBER ( PASSWORD )

160827021

Note: The Voting period starts from Wednesday, 21st September, 2016 (9:00 a.m.) and ends on Friday, 23rd September, 2016 (5:00 p.m.). The voting module shall be disabled by CDSL for voting thereafter.

INOX LEISURE LIMITED (CIN: L92199GJ1999PLC044045)

Registered Office: ABS Towers, Old Padra Road, Vadodara – 390 007.Telephone: 0265 6198111|Fax: 0265 2310312

Website: www.inoxmovies.com |Email ID: [email protected]

PROXY FORM

[Pursuant to Section 105(6) of the Companies Act, 2013 and Rule 19(3) of the Companies (Management and Administration) Rules, 2014]17th Annual General Meeting – Saturday, 24th September, 2016

Name of the Member(s) :Registered Address :

E-mail ID :Folio No./ Client ID :DP ID :

I/We, being the member(s) of ______________________________________________ shares of the above named Company, hereby appoint:1) Name: _____________________________________________________ E-mail id: _______________________________________________ Address: ______________________________________________________________________________________________________________ ________________________________________________________________________ Signature: _________________________________, or failing him /her2) Name: _____________________________________________________ E-mail id: _______________________________________________ Address: ______________________________________________________________________________________________________________ ________________________________________________________________________ Signature: _________________________________, or failing him /her3) Name: _____________________________________________________ E-mail id: _______________________________________________ Address: ______________________________________________________________________________________________________________ ________________________________________________________________________ Signature: _________________________________,

as my / our proxy to attend and vote (on a poll) for me / us and on my / our behalf at the 17th Annual General Meeting of the Company, to be held on Saturday, 24th September, 2016 at 12.00 noon at Maple Hall, Hotel Express Residency, 18/19, Alkapuri Society, Vadodara – 390 007 and at any adjournment thereof in respect of such Resolutions as are indicated below.

Resolution Number

Resolution Vote (Optional-see Note 2)(Please mention no. of shares)For Against Abstain

Ordinary Business

1. Adoption of the (a) Audited Standalone Financial Statements of the Company for the Financial Year ended

31st March, 2016, the report of Auditors thereon and the report of the Board of Directors for the said year; and

b) the Audited Consolidated Financial Statements of the Company for the Financial Year ended 31st March, 2016 and the report of the Auditors thereon.

2. Appointment of Director in place of Mr. Siddharth Jain (DIN: 00030202), who retires by rotation and, being eligible, seeks re-appointment.

3. Ratification of appointment of Independent Auditors of the Company and to authorize the Board of Directors of the Company to fix their remuneration.

Special Business4. To approve the payment of professional fees to Mr. Deepak Asher (DIN: 00035371),

Non-executive Director of the Company.5. Grant of Employee Stock Options to the employees of the Holding and Subsidiary

Company(ies) of the Company under ILL – Employee Stock Option Scheme – 2006.

Signed this _____________day of ___________________2016.

____________________ _________________________ Signature of Member Signature of Proxy Holder(s)

Notes: 1. This form of proxy, in order to be effective, should be duly completed and deposited at the Registered Office of the Company, not less than 48 hours

before the commencement of the Meeting.2. It is optional to indicate your preference. If you leave the ‘For’, ‘Against’ or ‘Abstain’ column blank against any or all of the resolutions, your proxy

will be entitled to vote in the manner as he/she may deem appropriate.

Affix a Revenue Stamp not less

than ` 1

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