LEEL Electricals Limited · ANNUAL REPORT 2016-17 LEEL Electricals Limited (Formerly Lloyd Electric...

ANNUAL REPORT2016-17

ANNUAL REPORT2016-17

LEEL Electricals Limited(Formerly Lloyd Electric & Engineering Limited)

“Creating a Sustainable Future”

A N N U A L R E P O R T 2 0 1 6 - 1 7

CORPORATE OVERVIEW

Corporate Information 1

Key Financial Highlights 2

Company Snapshot 3

Corporate Social Responsibility 13

Corporate Sustainability 18

STATUTORY REPORTS

Board's Report & its Annexures 21

Management Discussion & Analysis Report 47

Report on Corporate Governance 55

FINANCIAL STATEMENTS

Standalone Financial Statements

Independent Auditors' Report 76

Financials 82

Consolidated Financial Statements

Independent Auditors' Report 124

Financials 128

Form AOC-1 173

CORPORATE OVERVIEW STATUTORY REPORTS FinAnciAl STATEmEnTS

1

CORPORATE INFORMATION

BOARD OF DIRECTORS

Mr. Brij Raj PunjChairman & Managing Director

Mr. Bharat Raj PunjDeputy Managing Director

Mr. Achin Kumar RoyWhole Time Director

Mr. Mukat B. SharmaWhole Time Director & Chief Financial Officer

A.V.M. Surjit Krishan Sharma (Retd.)Non-Executive Independent Director

Mr. Ajay DograNon-Executive Independent Director

Mr. Ramesh Kumar VasudevaNon-Executive Independent Director

Dr. Geeta Ajit TekchandNon-Executive Independent Director

Ms. Deepti SahaiNon-Executive Independent Director

COMPANY SECRETARY & VP FINANCE

Ms. Anita K. Sharma

STATUTORY AUDITORS

M/s Suresh C. Mathur & Co.,

Chartered Accountants

64, Regal Building (IInd Floor),

Connaught Place,

New Delhi 110001

MANUFACTURING PLANTS

Domestic

1. A-146 (B&C) RIICO Industrial Area, Bhiwadi Distt. Alwar, Rajasthan 301019

2. Industrial Area, Kala-Amb, Trilokpur Road, Sirmour, Nahan, Himachal Pradesh.

3. Plot No. 24, Sector 2, IIE, SIDCUL Pantnagar, Uttarakhand.

4. Plot No. S21 & 22, Non SEZ, Phase III, Sipcot Road, Mugundarayapuram, Ranipet, Vellore Distt, Tamilnadu.

5. Bahadarabad, Mehdood, Industrial Park, 2 Salempur, SIDCUL, Haridwar, Uttarakhand.

6. Village Nizampur, Tauru- Rewari, Tehsil Tauru, Dist. Mewat, Haryana.

Overseas(Owned by Subsidiaries)

1. Lloyd Coils Europe s.r.o Prague-5, Radotin, Vrazska 143, Czech Republic. Postal Code 15300.

2. Janka Engineering s.r.o Prague-5, Radotin, Vrazska 143, Czech Republic. Postal code 15300.

3. Noske-Kaeser Rail & Vehicle New Zealand Limited 20, Noel Rodgers Place, Milsone,

Palmerston, North, 4414 New Zealand.

BANKERS

State Bank of India

IndusInd Bank

Axis Bank

IDBI Bank

The Karnataka Bank

Jammu & Kashmir Bank

Societe Generale

Bank of Baroda

Syndicate Bank

SHARE TRANSFER AGENT

Skyline Financial Services Private Limited

D-153 A, Okhla Industrial Area

Phase- I, New Delhi 110020

Tel: 011-26812682, 83

Fax: 011- 26812684

REGISTERED OFFICE

Unit No. 8, Block B,

Old District Courts Complex,

Industrial Area, Phase-II,

Noida, Uttar Pradesh 201305

Ph.: 0120- 4098444

CORPORATE OFFICE

159, Okhla Industrial Estate

Phase- III, New Delhi-110020

Ph: 011-40627200-300

Fax: 011-41609909

2 Annual Report 2016-17

LEEL Electricals Limited

Key Financial Highlights(` In Crores)

Standalone IND AS

Standalone Consolidated IND AS

2016-17 2015-16 2014-15 2013-14 2012-13 2011-12 2010-11 2009-10 2008-09 2007-08 2016-17 2015-16

Total Income (Gross) 3024.41 2388.68 1839.53 1451.72 1175.30 905.06 783.64 679.53 587.90 669.90 3375.77 2729.41

Operating Profit (EBITDA)

273.84 263.77 229.84 189.58 145.88 93.47 84.19 73.12 50.10 82.83 273.18 262.09

Profit Before Tax 118.97 79.47 103.02 81.77 72.87 45.28 48.66 45.28 24.77 62.18 104.28 64.78

Profit After Tax 85.49 56.53 81.64 76.09 56.15 33.59 36.06 34.38 20.37 52.71 70.34 42.41

Financial Position

Paid up Share Capital 40.34 36.21 35.32 35.32 31.00 31.00 31.00 31.00 31.00 31.00 40.34 36.21

Share Capital Suspense - - - - 4.32 4.32 - - - - - -

Total Paid up Share Capital

40.34 36.21 35.32 35.32 35.32 35.32 31.00 31.00 31.00 31.00 40.34 36.20

Reserves & Surplus 880.78 758.04 680.56 599.49 526.15 442.53 401.04 371.16 340.40 320.03 859.84 746.68

Shareholder's fund 921.12 813.69 738.69 634.81 561.48 473.53 432.05 402.17 371.40 351.04 900.18 802.32

Performance Indicator

EPS (In `) 21.19 15.61 23.11 21.54 15.90 10.83 11.63 11.09 6.57 17.01 17.44 11.71

Note: 1. Figures of Financial Year 2015-16 and 2016-17 have been calculated in accordance with the new Indian Accounting Standards (IND AS). 2. Profit after tax includes “other comprehensive income”.

3024.41

2388.68

1839.53

1451.72

1175.30

905.06783.64

679.53587.90

669.90

0.00

500.00

1000.00

1500.00

2000.00

2500.00

3000.00

3500.00

Total Income (` in Crores)

85.49

56.53

81.64

76.09

56.15

33.5936.06

34.38

20.37

52.71

0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

80.00

90.00

Profit After Tax (` in Crores)

21.19

15.61

23.11

21.54

15.90

10.8311.63

11.09

6.57

17.01

0

5

10

15

20

25

Earning Per Share (In )`

Standalone Financial Trends

273.84263.77

229.84

189.58

145.88

93.4784.19

73.12

50.10

82.83

0.00

50.00

100.00

150.00

200.00

250.00

300.00

Operating Profit EBITDA ( ` in Crores)


3

State of Art Manufacturing Facilities...

Bhiwadi plantWindow AC assembly line

Hair pin bender



Assembly line for Metro Rail HVAC New facility for Metro Rail HVAC and Test Lab

Electrical panel for Metro Rail HVAC



5


Flux brazing furnace for manufacturing aluminium radiatorsVacuum brazing furnace

Vertical milling center



Psychometric test lab Helium leak detector

Fin making machine



7

Key products...

Heat exchangerDry air cooler

Split and Window type air-conditioners



Dry coolers Heat Exchanger

Roof mounted packaged units for Railways

Key products...


9

Overseas manufacturing facilities...

Lloyd Coils Europe s.r.o.

Evaporator CoilEvaporator

Stainless steel CoilFan condenserCEBI Expander



Janka Engineering s.r.o.

Air handling unitCentrifugal fan RSH transfer V-belts

Air-handling unit for nuclear power plantStainless Steel Special Cooler Railway unit in bratislava



11


Noske Kaeser New Zealand Faciity

8kW side mounted air-conditioning unit8kW roof mounted air-conditioning unit

56kW roof mounted air-conditioning unit43kW roof mounted air-conditioning unitNew Zealand factory



Exhibitions...

ISH trade fair in Frankfurt, Germany Chillventa fair in Nuremberg, Germany

Presentation of rail systems at innotrans trade fair

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CORPORATE OVERVIEW STATUTORY REPORTS FINANcIAl STATEmENTS

At LEEL, we believe in ‘Performance with Purpose’ and we are committed to achieve business and financial success while leaving a constructive imprint on society and environment. Since inception, the Company has always been a responsible corporate citizen and a steady contributor towards the enrichment of the society. We believe in investing part of our profit beyond business, for the larger good of the society.

Over decades, the Company has, through its philanthropic arm “Pandit Kanahaya Lal Punj Trust”, created a space for itself in the society in which it operates as a Company that ‘Cares’. Our CSR activities are traditionally driven by a moral obligation and philanthropic spirit with a vision to “help the underprivileged children & youth of our country to realize their potential”. Over the time our CSR objectives have become an integral part of the

business and rooted in the core values driven by our aspirations for excellence in the overall performance of the Group.

The primary objective of the Trust is to fulfill the developmental needs of the marginalized and under privileged communities of the society and to make a difference in their lives, especially those who are not as privileged as many of us are. Apart from the core areas, as a part of long term process we do our bit to implement focused programmes on girl child welfare, primary education, skill development and vocational trainings to the needy and under privileged members of our society, contribution to the well being of the society through best possible health care to the needy and deprived people, children’s healthcare facilities and community service for the aged and the physically/mentally challenged.

OUR FOCUS AREAS

Education

In India, education in rural areas is a key to eradicate poverty and

illiteracy and we believe that it is the most compelling means to

initiate social alterations and improve community development.

The initiative of imparting free of cost quality education through

‘PKLP Schools’ (formerly ‘Lloyd Play School’) a flagship project

through “Pandit Kanahaya Lal Punj Trust” which is dedicated to

bring a change through holistic and excellent quality education

in the life of underprivileged rural youth of the communities

with a focus on the ‘girl child’ with a hope that these children

will become agents of change and catalyze transformation. The

primary objective behind the inception of PKLP Schools are to

impart free of cost and quality education to the underprivileged

children with a focus on the girl child in the backward and rural

areas where poverty is the major obstacle that limits education

CORPORATE

SOCIAL

RESPONSIBILITY



for girls. The PKLP Schools strive to provide modern infrastructure

and amenities to enhance the learning levels of students by

providing them with exposure especially in english, life skills and

communication.

At present, the Trust is running two PKLP Schools at

Village-Khori Kalan, Tehsil-Tauru, Haryana and Maneri, Jabalpur,

Madhya Pradesh. The Trust is also constructing its own school

building for PKLP School, a free education initiative of the

Trust, at its own land situated at Village Nizampur, Tehsil-Tauru,

Distt.-Mewat (Haryana) which is about to complete and will be

functional very soon.

Value Education: In PKLP Schools, we follow Xseed’s 5 step

learning method which is a proven and research based academic

program for schools that builds thinking & problem solving skills

and improves their overall personality. The program train the

children to ask more questions, write in their own words such

as doing word problems in mathematics, completing homework

on their own, not afraid of speaking in English, persist longer in

solving problems and score well on tests. In addition, the schools

also time to time takes “Learnometer” test to check and monitor

the learning ability of the children.

The teachers of the schools are provided regular training for

imparting child centered teaching methodologies through various

sessions.

Co-Scholastic Activities: The Schools regularly organize activity

based learning with a focus on co-scholastic activities such as life

skills, values, health, sanitation, etc. in order to develop overall

personality of the children. Number of extra-curricular activities

were organized during the year under review such as trekking,

mathematics workshop, Independence day celebration, Republic

day celebration, Holi and Diwali celebrations, teacher’s day

celebrations, children day celebration, international women’s day,


15

mother’s orientation programme and visit to National Park, Police

Station, Bank, Post office, Railway Station, Shopping Complex etc.

to improve all-round mental growth of Children.

A visit to hospital was also organized by the Schools, to make

the students familiar with the infrastructure and functioning of

a hospital, the students were accompanied by the doctors and

nurses who took the students around the hospital campus and

explained them about the various medical facilities. They were

also made aware about various apparatuses used in a hospital like

stethoscope, thermometer etc.

The children of PKLP School, Maneri, Jabalpur were taken on an

Education Tour to Cantonment Khalsa English Medium School at

Jabalpur under the guidance of the Principle and the Teachers

of the School. The students interacted with the students and

teachers of Khalsa School and shown outstanding spoken skill,

gentle behavior, general knowledge and disciplined attitude. They

also won several prizes.

Health & Nutrition: Good health and nutrition is a key for the

overall development of children to grow and live a healthy life.

During the year, Schools at Tauru and Jabalpur have conducted

various health checkups for the children that included vaccination

of Polio, Hepatitis, Typhoid, MMR including ophthalmic, ENT,

dental, skin, blood tests and general checkups, the children are

regularly monitored by the specialized doctorsand provided

with necessary guidance & medication. At Jabalpur, school has

conducted health checkups for the children once in every week

in the monsoon season and thereafter it is being conducted once

in a month.

The schools have their own in house kitchen that provides free of

cost healthy food to the children to cater their nutrition needs,

with required vaccination, medical attention and proper nutrition,

the children are now more healthier and medically fit.



Women Empowerment “If you educate a man you educate an individual but if you educate a woman you educate an entire Nation.”

There is no tool for development more effective than the empowerment of women. Education and skill development empower women to a large extent and where women are educated and empowered, society grows fastest.

At LEEL, we believe that with equal access to education, training and skill development, women can raise the living standards of their families and inject new life into the local economy. In line with this vision, LEEL has started giving vocational training to women coming from marginalized and under privileged section of society through various workshops has been imparted for stitching and other soft skills etc.

The Company has started Women Empowerment Cell (WEC) in Jabalpur, Madhya Pradesh and Tauru Haryana in the year 2015 as a training center for rural ladies which provides training in stiching and tailoring. Now, it has become Production Unit. WEC is working towards creation of self-employment opportunities to improve the economic condition of the women by earning decent livelihoods.

After learning from many major internal orders WEC Jabalpur is currently working on the prestigious order of the Indian Army.

The Company begged an order of 100 pants from JAK Rifles and successfully completed & dispatched the same. The Company is in process for getting order of Cheetah Uniforms of the Border Security Force (BSF).

Seeing the quality stitching of our ladies the agencies are positive and provided assurance to continually give us orders pertaining to different regiments of the Army.

This esteemed external order of the Indian Army has helped in boosting the confidence of the ladies of WEC and has capacitated them to learn variations in apparels and acquire perfection. WEC aims to achieve greater heights and empower these rural ladies in its true sense, making them self-dependent.

Health Check upsIt has been observed that even after providing nutritious food, regular health check-ups and clean environment to the children of PKLP School at Maneri Village, Madhya Pradesh and to Women of WEC, children and women were regulalry falling ill. Hence, health check-up were also conducted free of cost in the areas where families of the students/women are staying covering villages-Jhurki, Kherani and Paudi, Madhya Pradesh. A team of doctors were taken to the villages and around 300 people were examined by the doctors and they gave medical guidance and required treatment. The prescribed medicines were also distributed to the


17

Rs.18,000 on tractors and market manure, which is a good amount of saving for these poor farmers. Additionally, they have been able to increase the fertility of the soil and save their crop from the harmful effects of chemical farming.

Previously the farmers used to sow only 1 crop in a scattered way, our team had suggested them for “lined double cropping”, which they followed and have sown rice in lines maintaining specific distance among seeds to balance the availability of nutrients and water and have sown corn and arhar together. Due to this they were able to get double yield in the same time, space and labor. As per our guidance, they are making organic pesticides as well, using cow dung, cow urine and jaggery and another pesticide by decomposing neem and acouna leaves found in good quantity in the village.

It is also pertinent to note that all these villages have scarcity of water and with the use of organic farming, water usage has also drooped down to 60% as compared to be used in chemical fertilizers.

A remarkable difference is evident in the fields of the farmers who have opted for OrganicFarming. As a result, more people are approaching our team for guidance.

Our team is tirelessly working towards achieving our CSR initiatives.

patients free of cost. The free health checkups were conducted every week in monsoon season and once in a month in every other month to take follow up of the health condition of the patients and monitor their medical needs.

Organic FarmingIn Jabalpur, we decided to pursue a lesser known concept of Organic Farming under the guidance of a team of doctors, scientists and agriculturists. We introduced this method of farming in the month of December, 2016 in the village Jhurkhi of Mandla district, Madhya Pradesh and several farmers interested in organic farming were selected to initiate the process and worm pits were made near their houses in consultation with the experts. Till now, approximately 10 quintals of manure have been made by earthworms in each of the worm pits made by our team.

Till the last season, the farmers were spending quite a lot on buying chemical fertilizers and pesticides from the market and hiring tractors for ploughing their fields. Now, they are using only organic manure and are saving a considerable amount on chemical fertilizers and pesticides. With our counseling and guidance, this year they have ploughed their fields conventionally using bullocks and plough which is the best way to conserve the fertility of soil.

As each of the selected farmers are doing farming in 3 acres or more and hence on an average they have saved a minimum of



CORPORATE SUSTAINABILITY

“Because we all share this planet earth, we have to learn to live in harmony and peace with each other and with nature. This is not just a dream, but a necessity. “

…His Holiness the Dalai Lama

The Company believes that corporate sustainability is an approach which creates long-term corporate success by implementing a business strategy that considers every dimension of how a business operates in the ethical, social, environmental, cultural, and economic spheres. The Company always believed that the well-being of employees, social communities and the planet is inextricably tied to the health of the business. Corporate Sustainability of the Company begins with operating with integrity. The Company understands its fundamental responsibilities in the areas of human rights, labour, environment and anti-corruption. The Company has provided a moral code for management and employees, accountability towards society, seeing beyond risk and finding real value in actively addressing social, environmental and governance issues.

Social, Health & SafetySafe working conditions, including those that protect the safety and health of workers, are assured at all levels. Occupational Health and Safety is a core part of our business philosophy. We are committed to providing a safe and healthy workplace to our

employees and stakeholders. Employees undergo periodic training on OH&S and the performance is reviewed during business meetings and management review meetings. The Company conducts regular health check-ups for employees and children of PKLP schools and in rural areas situated near school.

The Company periodically assesses its own operations and value chain to uphold labour standards. By promoting decent work and inclusive employment opportunities, the Company also plays a role in advancing societal priorities, including by partnering with workers to improve industrial relations and building more resilient economies and communities.

Emphasis is on continuous training of workmen to upgrade their skills. Separate space has been enmarked for skill development at the shop floor.

The Company also believes that gender equality is a fundamental and inviolable human right, it is also essential to expand economic growth, promote social development and enhance business performance. We focus on women and girls because of the “ripple effect”. It improves economic and social conditions for everyone. The Company continued to advance gender equality and women’s empowerment in the workplace. Further, the Company is running two Women Empowerment Cell (WEC) at Tauru, Haryana and

The fire training demo at factory site

Process Identification


19

Jabalpur, Madhya Pradesh which provide vocational training to women of rural area through various workshops. For detailed note on WEC please refer Corporate Social Responsibility Section of Annual Report.

The Company condemns the illicit use of child labour and forced labour and does not engage them in any form. The Company also works towards educating children of workers and other backward section of society with a view to shape them for better future.

EnvironmentThe world is facing unprecedented, interconnected environmental challenges in areas including climate change, water, energy, biodiversity and agriculture. With business relying on natural resources directly and via supply chains, corporate efforts are needed to address environmental responsibilities, value natural capital and for better understanding the linkages between resources.

The Company integrates environmental responsibilities throughout its business operations while at the same time meeting our customers’ expectations with respect to the products, processes, functions, quality management and service. The Company is focusing more on R&D and developing newer and finer products, which will not only meet consumers’ expectations in terms of energy efficiency but global standards for environmental, health

Vocational training to women

& safety. Sewage Treatment Plant (STP) and Effluent Treatment Plants (ETP) are set up in the factories for recycling of waste water. Recycled water is being used in horticulture. Rain water harvesting is also actively being used across the facilities and the Company is maintaining green area in factory and in its surroundings. Alternate sources of energy and fuels are being used in manufacturing processes in place of conventional sources to reduce carbon emissions.

As a green initiative, LEEL offers every customer visiting its premises to plant a tree in the compound wall of the organization.

EconomicThe most fundamental contribution a company can make towards achieving societal priorities is to be financially successful while upholding a high standard of ethics and treatment of employees, the environment and the community. Doing business responsibly is key responsibility of your Company. The Company’s solutions combine product innovation with global manufacturing excellence. We innovate, we maintain our core competencies and we deliver.

The social, environmental and economic sustainability are affinitive to each other, as we know, every economic activity has some positive or negative impact on the environment as well as on the society, hence, it’s our pledge to improve the lives and prospects of the people and the society in social, environment as well as in economic terms.

_____________________________________________________

“We endeavor to engineer smiles and enrich lives of all the stakeholders of the Company

through our varied products, quality, services and innovation.”

_____________________________________________________

Maintenance of green space around factory area

Plantation by Hindustan Aeronautics Limited Representative



STATUTORY REPORTS

Corporate overview STATUTORY REPORTS FinanCial StatementS

21

BOARD’S REPORT Dear Shareholders,

Your Directors have pleasure in presenting the 30th Annual Report on the business and operations of the Company alongwith the Standalone and Consolidated Audited Accounts for the Financial Year ended on March 31, 2017.

SUMMARISED FINANCIAL RESULTS(` in crore, except per share data)

STANDALONEfor the year ended

CONSOLIDATEDfor the year ended

Particulars March 31, 2017 March 31, 2016 March 31, 2017 March 31, 2016Revenue from Operations 3,022.43 2,387.63 3,366.85 2,720.32

Other Income 1.98 1.05 8.93 9.09

Earnings before Interest, Depreciation & Tax (EBIDTA) 273.84 263.77 273.18 262.09

Finance Cost 118.89 105.30 119.95 106.15

Depreciation 35.98 33.20 48.95 45.35

Profit from ordinary activities but before exceptional items 118.97 125.27 104.28 110.59

Exceptional Items - (45.80) - (45.80)

Profit before tax 118.97 79.47 104.28 64.78

Less: Current Tax 36.20 17.00 36.93 17.65

Deferred Tax (2.37) (0.30) (2.64) (1.51)

MAT Credit Entitlement - 6.94 - 6.94

Profit for the year 85.14 55.82 69.99 41.70

Add: Other comprehensive Income 0.35 0.71 0.35 0.71

Total Comprehensive Income 85.49 56.53 70.34 42.41

Basic Earnings Per Share (EPS) (`) 21.19 15.61 17.44 11.71

PERFORMANCE OF THE COMPANY

For the financial year ended March 31, 2017, on standalone basis, the revenue from the operations grew by 27% to Rs.3,024 Crores as compared to Rs.2,389 Crores during the previous year. Operating profit for the year was higher by 4% to Rs.274 Crores as compared to Rs.264 Crores in the previous year. The profit before exceptional item and the tax stood at Rs.119 Crores as compared to Rs.125 Crores during the last year mainly due to increase in finance cost to Rs.118 Crores as against Rs.105 Crores during the previous year as a result of the working capital borrowings. The profit after exceptional item and tax stood at Rs.85 Crores as against Rs.56 Crores during the previous year thereby registering growth of 52%. The total comprehensive income for the year stood at Rs.85 Crores as compared to Rs.56 Crores during the previous year.

On the consolidated basis, the revenue from the operations for the year ended March 31, 2017 was Rs.3,376 Crores as compared to Rs.2,729 Crores during the previous year registering a growth of 24%. Operating profit for the year was marginally higher to Rs.273 Crores as compared to Rs.262 Crores in the previous year. The consolidated profit before exceptional item and tax stood at Rs.104 Crores and after tax was Rs.70 Crores as compared to Rs.111 Crores and Rs.42 Crores respectively during the previous year. The total comprehensive income for the year stood at Rs.70 Crores as compared to Rs.42 Crores during the previous year. The decline in profitability was on account of difficult market conditions which prevailed in France and Spain where subsidiaries observed lower sales volume.

OPERATIONS

During the year under review, your Company organized its revenue stream into three reportable business segments:

a) Consumer Durable Segment

b) OEM & Packaged Air conditioning Segment

c) Heat Exchangers & Components Segments



Your company has delivered a consistent performance during the financial year with standalone revenue registering a growth of 27% to Rs.3,024 Crores. The consumer durable segment revenue and the results from this segment stood at Rs.1,885 Crores and Rs.121 Crores during the year as against Rs.1,337 Crores and Rs.106 Crores during the previous year.

The OEM and the packaged air conditioning segment revenue and the results stood at Rs.936 Crores and Rs.60 Crores as against Rs.880 Crores and Rs.50 Crores respectively during the last year. During the year, the Company has developed and launched new range of highly efficient Eco-friendly inverter ACs meeting with 2018 energy efficiency norms for residential segment.

Heat Exchangers and the Component Segment caters to the manufacturing of heat exchangers and the evaporator coil for the heating ventilation and the air conditioning industry and copper & brass heat exchangers for the railways, heavy automobiles and other industrial applications and the component business of sheet metal. During the year, the revenue of the segment stood at Rs.604 Crores as compared to Rs. 611 Crores during the previous year and the segment results stood at Rs.66 Crores as compared to Rs.82 Crores during the previous year.

For detailed review, please refer Management Discussion and Analysis Report as attached and forms part of the Annual Report.

MATERIAL EVENTS OCCURRED AFTER BALANCE SHEET DATE

The Company had sold its Consumer Durable Business comprising of business of importing,trading, marketing, exporting, distribution, sale of air conditioners, televisions, washing machines and other household appliances and assembling of televisions under the brand “LLOYD” and all of the rights, title, interest, licensees, contracts, assets,continuing employees, intellectual property including the brand, logo, trade mark “LLOYD”as a going concern on slump sale basis to Havells India Ltd. (‘Havells’) on May 8, 2017 at an enterprise value of Rs.1,550 Crores on a debt free cash free basis. With effect from the closing date all assets/interest/rights etc. including continuing employees of the consumer durable business got transferred to Havells closing date pursuant to the agreement entered with Havells.

The sale of the consumer durable business will not have any impact on the Company’s existing B2B air conditioning business as the Company has not sold any of its manufacturing facility as the part of the aforesaid transaction and the Company shall continue with its existing business of manufacturing of air conditioners as OEM suppliers for other brands, packaged air conditioning for railways and heat exchanger business which are its core competencies.

Pursuant to the transaction, the Company has also changed its name to ‘LEEL Electricals Ltd.’ which was duly approved by the Central Government on May 23, 2017.

DIVIDEND

Your Directors are pleased to recommend a final dividend of Rs.1.50 per equity share of face value Rs.10 each i.e. @ 15% for the year ended March 31, 2017, subject to approval of shareholders of the Company (previous year Rs.1.30 per equity share of Rs.10 each i.e. @13 %). The total dividend payout would be Rs.7.28 Crores, including dividend distribution tax.

Further, the Board of Directors had, in its meeting held on May 30, 2017, declared a special dividend (one time dividend) of Rs.20 per equity shares of the face value of Rs.10 each (200%) out of proceeds of sale of Consumer Durable Business, aggregating to Rs.97.08 Crores (including dividend distribution tax). The said dividend was paid on 15.06.2017.

TRANSFER TO RESERVES

The Company proposes to transfer Rs.30 Crores to the general reserve out of the amount available for appropriation and an amount of Rs.346.87 Crores is proposed to be retained in the profit and loss account.

SHARE CAPITAL

During the period under review, the authorized share capital of the Company stood at Rs.70 Crore, divided into 7 Crore equity shares of Rs.10 each.

During the year under review the Company has issued and allotted 41,27,000 Equity Shares to promoter group companies upon conversion of equivalent number of Share Warrants allotted on preferential basis.

Pursuant to allotment of 41,27,000 equity shares, the issued, subscribed capital of the Company stood at Rs.40.35 Crore and paid-up capital stood at Rs.40.34 Crore as at March 31, 2017. For further details please refer note 17 of the standalone financial statements.


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FIRST TIME ADOPTION OF INDIAN ACCOUNTING STANDARD (IND AS)

The financial statements are prepared in accordance with the new Indian Accounting Standards notified by the Ministry of Corporate Affairs vide its notification dated February 16, 2015. These financial statements are the first financial statements of the Company under IND AS. Detailed information on the impact of the transition from previous GAAP to IND AS is provided in the annexed financial statements.

SUBSIDIARY COMPANIES

As at financial Year ended March 31, 2017, your Company has five direct wholly owned subsidiaries (WOS) viz; Lloyd Coils Europe s.r.o., Janka Engineering s.r.o., Noske Kaeser Rail & Vehicle Germany GmbH, Noske Kaeser US Rail & Vehicle LLC, Noske Kaeser Rail & Vehicles New Zealand Ltd. and two Indirect WOS through Noske Kaeser Rail & Vehicles New Zealand Ltd. viz; Noske-Kaeser Rail & Vehicle Australia Pty Ltd. and Noske-Kaeser Empreendimentos e Participaçôes do Brasil Ltda.

There are no associate companies within the meaning of Section 2(6) of the Companies Act, 2013 (Act). There has been no material change in the nature of the business of the subsidiaries.

In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements of the Company and its subsidiaries, which form part of the Annual Report. For details please refer Note 2.4 and 51 of the Consolidated Financial Statements.

Further, a statement containing the salient features of the financial statement of our subsidiaries in the prescribed format AOC 1 is attached to the financial statements of the Company.

In accordance with Section 136 of the Companies Act, 2013, the audited financial statements, including the consolidated financial statements and related information of the Company and audited accounts of each of its subsidiaries, are available on our website www.leelelectric.com. These documents will also be available for inspection during business hours at our corporate office.

For detailed performance review of subsidiaries, please refer Management Discussion and Analysis Report as attached and forms part of the Annual Report.

GLOBAL DEPOSITORY RECEIPTS (GDRs)

The Company has 8,000 GDRs underlying 16,000 equity shares outstanding for conversion as on 31st March, 2017. The GDRs are listed on the Professional Securities Market of London Stock Exchange. The Bank of New York acts as the Depository and ICICI Bank as the domestic custodian in respect of GDRs issued.

FIXED DEPOSITS

During the year under review, the Company has not accepted any deposits from the public under Section 73 of the Companies Act, 2013 and rules made thereunder.

CORPORATE GOVERNANCE

Your Company has always laid a strong emphasis on transparency, accountability and integrity and believes that good governance is the basis for sustainable growth of the business and enhancement of shareholder value. We keep our governance practices under continuous review and benchmark ourselves to the best governed companies across the globe.

The report on corporate governance forms an integral part of this report and is set out as separate section to this annual report. The certificate of M/s. Suresh C. Mathur & Co., Chartered Accountants, the statutory auditors of the Company certifying compliance with the conditions of corporate governance as stipulated in Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed with the report on corporate governance.

MANAGEMENT DISCUSSION & ANALYSIS REPORT

As required pursuant to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a detailed Management Discussion and Analysis Report is attached herewith and forms a part of the Annual Report.

LISTING AGREEMENT

The equity shares of the company are listed at BSE Ltd. and National Stock Exchange of India Ltd. The GDR’s are listed on London Stock Exchange.

Annual Listing fees to above exchanges for the Financial Year 2017-18, as applicable have been paid well before the due date.



CORPORATE SOCIAL RESPONSIBILTY (CSR)

The Company believes that CSR is a business approach that contributes to sustainable development by delivering economic, social and environmental benefits for all stakeholders. LEEL has always endeavored to promote education and well-being of weaker sections of society.

In recognition of this, LEEL concentrates most of its sustainability / CSR efforts by actively supporting the education and social causes through its philanthropic arm “Pandit Kanahaya Lal Punj Trust”.

In accordance with the requirements of Section 135 of Companies Act, 2013, your Company has constituted a CSR Committee. The composition and terms of reference of the CSR Committee is provided in the Corporate Governance Report.

Further, details about the CSR policy and initiatives taken by the Company on CSR during the year are available in our website. The annual report on our CSR activities is appended as Annexure 1 to the Board’s Report.

EXTRACT OF THE ANNUAL RETURN

In accordance with Section 134(3)(a) of the Companies Act, 2013, an extract of the annual return in the prescribed format is appended as Annexure 2 to the Board’s report.

NUMBER OF MEETINGS OF THE BOARD

The Board met five times during the financial year viz; on May 30, 2016; August 31, 2016; November 23, 2016; February 9, 2017; and February 18, 2017. The necessary quorum was present at all the meetings. The intervening gap between any two meetings was not more than one hundred and twenty days as prescribed by the Companies Act, 2013.

COMMITTEES OF THE BOARD

The Board has six committees viz; the Sub-Committee of the Board, Audit Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee, Stakeholders’ Relationship Committee and Special Committee for issue and allotment of shares.

The details pertaining to composition of above committees are included in the Corporate Governance Report, which forms part of the board’s report.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The policy of the Company on directors’ appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under Sub section (3) of Section 178 of the Companies Act, 2013, adopted by the Board, has been disclosed in the corporate governance report, which forms part of the Board’s Report.

BOARD EVALUATION

In pursuance to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the Board has carried out annual performance evaluation of its own performance, of Directors individually as well the evaluation of the working of committees. The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the Board composition and structure, board meetings and effectiveness of board processes, information and functioning, etc. The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the compliance with the terms of reference of the committees, composition of committees, functions and duties, committee meetings & procedures, etc.

The Board and the Nomination and Remuneration Committee (“NRC”) reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings, attendance, independent judgment etc. In addition, the Chairman was also evaluated on the basis of criteria such as leadership, managing relationship, conducting board meetings etc.

In a separate meeting of independent directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of the independent directors, at which the performance of the Board, its committees and individual directors was discussed.


25

The Board had, in its meeting held on May 30, 2017, upon recommendation of NRC and on the basis of performance evaluation of Non-executive Independent Directors, increased the sitting fees to be paid to them from Rs.15,000 to Rs.20,000 for attending each meeting of the Board. The said increase in sitting fees is under the limits as prescribed under the Companies Act, 2013.

DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMPs)

During the financial year under review and pursuant to the provisions of Section 203 of the Act, the Company was having six KMPs viz. Mr. Brij Raj Punj, Chairman & Managing Director, Mr. Bharat Raj Punj, Deputy Managing Director, Mr. Achin Kumar Roy, Whole Time Director, Mr. Nipun Singhal, Whole Time Director, Mr. Mukat B. Sharma, Whole Time Director & Chief Financial Officer and Ms. Anita K. Sharma, Company Secretary & VP Finance.

During the period under review, Mr. Gopal Kacker Non-Executive Independent Director had resigned from the directorship of the Company w.e.f. May 30, 2016. The Board of Directors had, in its meeting held on May 30, 2016, appointed Ms. Deepti Sahai as Non-Executive Independent Director (Additional) for a period of three years w.e.f. May 30, 2016, subject to the approval of shareholders. Her appointment was duly approved by the members at the 29th Annual General Meeting (AGM) held on August 26, 2016.

Mr. Mukat B. Sharma (DIN:02942036) Whole Time Director & CFO of the Company was re-appointed as such for a further period of two years w.e.f. January 28, 2017 by the Board of Directors in the meeting held on November 23, 2016 and Mr. Bharat Raj Punj (DIN:01432035), Deputy Managing Director of the Company was re-appointed as Deputy Managing Director by the Board in its meeting held on May 30, 2017 for a further period of 5 years w.e.f. August 8, 2017. The said appointments are placed before the shareholders for their approval in the ensuing 30th AGM.

Pursuant to the sale of Consumer Durable Business to Havells India Limited, Mr. Nipun Singhal (DIN:02026825), who was the business head of the said business segment, designated as Whole Time Director of the Company, had stepped down from the Directorship of the Company w.e.f. May 08, 2017.

The Board places its sincere appreciation towards the valuable contribution received from Mr. Kacker and Mr. Singhal during their tenure as the Directors of the Company.

Pursuant to provisions of section 152 of the Companies Act., 2013 and Articles of Association of the Company, Mr. Mukat B. Sharma (DIN: 02942036) will retire by rotation at the 30th AGM and being eligible, has offered himself for re-appointment.

The brief profile of the Directors who are proposed to be appointed / re-appointed, are furnished in the notice of 30th AGM. The Board recommends appointment /re-appointments of above said directors.

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from each independent director that he/she meets the criteria of independence as laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

DIRECTORS’ RESPONSIBILITY STATEMENT

The Audited Accounts for the financial year ended March 31, 2017 are in conformity with the requirements of the Companies Act, 2013. Pursuant to Section 134(5) of the Companies Act, 2013, your directors hereby confirm that:

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed alongwith proper explanation relating to material departures;

(b) 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 the financial year and of the profit and loss of the Company for that period;

(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and preventing and detecting fraud and other irregularities;

(d) the directors had prepared the annual accounts on a going concern basis;

(e) 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



(f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems and operating effectively.

AUDITORS & AUDITORS’ REPORT

Statutory Auditor

Pursuant to the provisions of section 139 of the Companies Act, 2013 (‘Act”) the shareholders of the Company had, in its 27th AGM held on July 21, 2014, appointed M/s Suresh C. Mathur & Co., Chartered Accountants as Statutory Auditors of the Company for a period of 3 years from the conclusion of 27th AGM till the conclusion of 30th AGM.

As per the provisions of Section 139 of the Act, the maximum tenure of an audit firm shall be two terms of five consecutive years. The recent changes in the Companies Act 2013, has made rotation of Statutory Auditors mandatory after 10 years. As per second proviso to Section 139(2) of the Companies Act, 2013, a transition period of three years from the commencement of the Act was provided to appoint a new auditor if the existing auditor’s firm has completed two terms of five consecutive years.

This is to further inform that M/s Suresh C. Mathur & Co., Chartered Accountants, existing Statutory Auditors, have completed a transition period of three years from the commencement of the Act, therefore, their term will expire upon conclusion of the forthcoming AGM.

The Board of Directors at its meeting held on May 30 2017, based on the recommendation of the Audit Committee has recommended the appointment of M/s Goel Garg & Co. Chartered Accountants, as statutory auditors of the Company in place of M/s Suresh C. Mathur & Co., Chartered Accountants, retiring auditors, for a period of 5 years commencing from the conclusion of 30th AGM till the conclusion of the 35th AGM, subject to ratification by shareholders every year.

M/s Goel Garg & Co. Chartered Accountants have consented to the said appointment and provided a certificate to the effect that if they are re-appointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

Auditors’ Report and the Notes on financial statements referred to in the Auditors’ Report are self-explanatory and do not call for any further comments. The Auditors’ Report does not contain any qualification, reservation or adverse remark. With regard to emphasis of matter as referred in Standalone and Consolidated Auditors’ Report regarding the sale of consumer durable business, please refer ‘events occurring after Balance Sheet date’ section under Board’s Report and note no. 49 of the standalone financial statements for suitable explanation.

Cost Auditor

The Board has re-appointed M/s Jain Sharma & Associates, Cost accountants, as cost auditors of the Company for the financial year 2017-18 at a fee of Rs.2,06,250 (including out of pocket expenses) plus applicable taxes, subject to the ratification of the said fees by the shareholders at the ensuing 30th Annual General Meeting.

The Company has also received a certificate from M/s Jain Sharma & Associates confirming that their appointment is in accordance with provisions of section 139, 141 & 148 of the Companies Act, 2013.

The cost audit report of the financial year 2016-17 would be filed with the Central Government within the prescribed time.

Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board had appointed Mr. Sanjay Chugh Practicing Company Secretary, to conduct Secretarial Audit for the financial year 2016-17. The Secretarial Audit Report for the financial year ended March 31, 2017 is appended as Annexure 3 to this Report.

The Board has re-appointed Mr. Sanjay Chugh, Practicing Company Secretary, as secretarial auditor of the Company for the financial year 2017-18.

The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

PARTICULARS OF LOANS AND GUARANTEES

The particulars of loans, guarantees and investments have been disclosed in the notes to the financial statements.


27

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm’s length basis. The Company has not entered in any material related party transaction during the year.

Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure 4 in Form AOC-2 and the same forms part of this report.

Please refer Note 40 to the financial statement which sets out related party disclosures.

RISK MANAGEMENT

The Audit Committee in supervision of Board of Directors is responsible for identifying, evaluating and managing all significant risks faced by the Company. The detailed statement indicating the development and implementation of risk management policy including identification therein of elements of risk has been covered in the management discussion and analysis, which forms part of this report.

INTERNAL FINANCIAL CONTROL

The Company has in place adequate internal financial controls with reference to financial statement, including adherence to the Company’s policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial disclosures.

The detailed information about internal controls is set out in the Management Discussion & Analysis report which is attached and forms part of this Report.

VIGIL MECHANISM

The Company has implemented a Whistle Blower Policy and has established a vigil mechanism for employees and directors to report their genuine concerns. The Policy provides for a mechanism to report genuine concerns to Whistle Counselor or the Whistle Blower Committee and in exceptional cases, Chairman of the Audit Committee of the Company. The functioning of the Vigil mechanism is reviewed by the Audit Committee from time to time. None of the Whistle Blowers have been denied access to the Audit Committee of the Board. The Whistle Blower Policy complies with the requirements of Vigil mechanism as stipulated under Section 177 of the Companies Act, 2013. The details of establishment of the Whistle Blower Policy/ Vigil mechanism have been disclosed on the website of the Company.

MATERIAL CHANGES AND COMMITMENT AFFECTING THE FINANCIAL POSITION OF THE COMPANY

Except as disclosed elsewhere in the Annual Report, there have been no material changes and commitments, affecting the financial position of the Company which occurred during between the end of the financial year to which the financial statements relate and the date of this report.

SIGNIFICANT AND MATERIAL ORDERS

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company’s operations in future.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act, are given in Annexure 5 to this Report.

PARTICULARS OF EMPLOYEES

Disclosures with respect to the remuneration of Directors and employees as required under Section 197 of the Act and Rule 5 (1) Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (Rules) have been appended as Annexure - 6 to this report. Details of employee remuneration as required under provisions of Section 197 of the Companies Act, 2013 and Rule 5(2) and 5(3) of the Rules are available at the Corporate Office of the Company during working hours, 21 days before the Annual General Meeting and shall be made available to any shareholder on request.



PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

The Company has a policy against sexual harassment and a formal process for dealing with complaints of harassment or discrimination. The said policy is in line with Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 and Rules made thereunder. The Company, through the policy ensures that all such complaints are resolved within defined timelines. During the year, no case was reported.

ACKNOWLEDGEMENT

We thank our shareholders, customers, vendors, investors and bankers for their continued support during the year. We place on record our appreciation for the contribution made by our employees at all levels. Our consistent growth was made possible by their hard work, solidarity, cooperation and support.

We also place on record deep appreciation to various statutory authorities, Central and State Governments and Government of various countries where we operate for their continued assistance, co-operation and encouragement they have extended to the Company and look forward to their continued support in future.

For and on behalf of the Board of Directors

Date: August 10, 2017. Achin Kumar RoyPlace: New Delhi Wholetime Director &

Chairman of the MeetingDIN:01475456

Annexure 1 to the Board’s Report

ANNUAL REPORT ON CSR ACTIVITIES FOR THE FINANCIAL YEAR 2016-17.

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

The Company believes in philosophy that ‘’CSR is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large.”

The Company’s CSR policy prioritizes to support the developmental needs of marginalized and underprivileged communities with focus in the areas of education, healthcare, environment, women empowerment, skill building, girl child welfare and community service for the aged and physically/mentally challenged. The Company’s CSR activities are carried out under the Flagship initiative “Pandit Kanahaya Lal Punj Trust”, the philanthropic arm of the Company.

The Company has formulated its CSR policy in line with its objectives as specified in the Companies Act, 2013. Details of the CSR policy and projects or programmes undertaken by the Company are available on the website of the Company www.leelelectric.com. Please refer website www.pklpschool.com for details regarding PKLP Schools.

Please refer Corporate Social Responsibility Section in Annual Report for brief overview of projects undertaken by the Company under CSR Initiative during the financial year 2016-17.

2. Composition of the CSR Committee: The Company has a CSR Committee of Directors comprising of Mr. Achin Kumar Roy, Chairman of the Committee, Mr. Mukat B. Sharma and Dr. Geeta Ajit Tekchand as members of the Committee.

3. Average net profit of the company for last three financial years for the purpose of computation of CSR: Rs.103.48 Crores

4. Prescribed CSR Expenditure: Rs.2.07 Crores

5. Details of the Expenditure on CSR during the financial year 2016-17:

a) Total amount proposed to be spent for the financial year Rs.2.07 Croresb) Total amount spent on CSR Rs.1.36 Croresc) Amount unspent, if any. Rs.0.71 Crores


29

6. Manner in which the amount spent during the financial year is detailed below: (` In Crores)

(1) (2) (3) (4) (5) (6) (7) (8)S.

No.CSR Project or

activity identifiedSector in which the project is covered

Projects or programs(1) Local area or other

(2)Specify the State and district where

projects or programs was undertaken

Amount outlay

(Budget) project or programs

wise

Amount spent on the projects or programs

Sub-heads:

Cumulative expenditure

up to 31st March,

2017.

Amount spent Direct or through implement-ing agency.

(1)Direct expenditure

on projects or programs

(2) overheads1 Training and educating

Children and women and increasing employability and promoting health care including preventive health care

Promoting education, including special education and employment enhancing vocation skills especially among children, women, elderly and the differently abled and livelihood enhancement projects including promoting health care including preventive health care

1. Schools and Women Empowerment Cells in Tauru, Haryana and Maneri, Jabalpur, Madhya Pradesh 2. Preventive health check-ups in schools and Women Empowerment Cells as referred above including in villages -Maneri, Jhurki, Kherani, & Paudi in Madhya Pradesh

1.355 1.355 1.355 Through Pandit Kanahaya Lal Punj Trust, Implementing Agency

2. Conservation of natural resources and maintaining quality of soil.

Conservation of natural resources and maintaining quality of soil.

1. Organic Farming Initiatives in Villages - Maneri, Jhurki, Kherani, &Paudi in Madhya Pradesh

0.005 0.005 1.36 Through Pandit Kanahaya Lal Punj Trust, Implementing Agency

Total 1.36 1.36 1.36

7. In case the company has failed to spend the two per cent of the average net profit of the last three financial years or any part thereof, the company shall provide the reasons for not spending the amount in its Board report:

The Company is constructing its own school building in Tauru for PKLP School. Though, budget has been allocated for construction of school building, the prescribed amount could not be expended in Financial Year 2016-17. The unspent amount is being expended in current financial year. Further, establishment of school projects, promoting women employability are multi -year projects and the Company is continuously working towards achieving its objectives.

8. Responsibility Statement

The CSR Committee confirms that the implementation and monitoring of the CSR activities of the Company are in compliance with the CSR objectives and the CSR policy of the Company.

Mukat B. Sharma Achin Kumar RoyWholetime Director & CFO Chairman, CSR Committee[DIN: 02942036] [DIN: 01475456]

Date: August 10, 2017.Place: New Delhi




FORM NO. MGT 9EXTRACT OF ANNUAL RETURN

as on financial year ended on 31.03.2017Pursuant to Section 92 (3) of the Companies Act, 2013 and rule 12(1) of the Company (Management & Administration) Rules, 2014.

I. REGISTRATION & OTHER DETAILS:

i CIN l29120UP1987Plc091016

ii Registration Date 10.11.1987

iii Name of the Company lEEl Electricals limited (Formerly lloyd Electric & Engineering ltd.)

iv Category/Sub-category of the Company company limited by Shares / Indian Non- Government company

v Address of the Registered Office & Contact Details Unit No. 8, Block B, Old District courts complex, Industrial Area, Phase-II, Noida, Uttar Pradesh- 201305. e-mail : [email protected]

vi Whether listed Company Yes

vii Name, Address & contact details of the Registrar & Transfer Agent, if any.

Skyline Financial Services Private limited D-153A, Okhla Industrial Area, Phase I, New Delhi 110020 Tel. No. 011-64732681-88, Fax No. 011 26812682 E-mail : [email protected]

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

SL No.

Name & Description of main products/services NIC Code of the Product /service

% to total turnover of the company

1 Consumer Durable Segment 46522 55%

2 Heat Exchanger & Components 28191 18%

3 OEM Segment & Packaged Air Conditioning 28192 27%

III PARTICULARS OF HOLDING, SUBSIDIARY & ASSOCIATE COMPANIES

Sl No.

Name & Address of the Company CIN/GLN* Holding/ Subsidiary/ Associate

% of Shares Held

Applicable Section

1 Lloyd Coils Europe s.r.o. Vrazska 143, 153 00 Praha 5, Radolin, Czech Republic

- Wholly Owned Subsidiary

100 2(87)

2 Janka Engineering s.r.o. Vrazska 143, 153 00 Praha 5, Radolin, Czech Republic


100 2(87)

3 Noske Kaeser Rail & Vehicle Germany GmbH Ruwoldtweg 15, 22309, Hamburg, Germany.


100 2(87)

4 Noske Kaeser Rail & Vehicles New Zealand Limited Morrison Creed, 52 Victoria Avenue, Palmerston North, 4410, NZ


100 2(87)

5 Noske-Kaeser Empreendimentos e Participaçôes do Brasil Ltda.# Rodovia BR-381, S/N, KM 490, Centro de Distribuicao Eadi, Betim, State of Minas Gerais

- Indirect Wholly Owned

Subsidiary

100 2(87)

6 Noske-Kaeser Rail & Vehicle Australia Pty Ltd.# R G Kelly & Co., Suite A3, 550 Canning Highway, Attadale WA 6156, Australia.

- Indirect Wholly Owned

Subsidiary

100 2(87)

7 Noske-Kaeser US Rail & Vehicle, LLC 2640 Fountain View Drive, Houston, TX-77057, United States of America


100 2(87)

* No CIN as these are foreign subsidiaries

# Wholly Owned Subsidiary through Noske Kaeser Rail & Vehicles New Zealand Limited


31

IV SHAREHOLDING PATTERN (Equity Share Capital Break up as % to Total Equity)

(i) Category-wise Shareholding

Category of Shareholders No. of Shares held at the beginning of the year

No. of Shares held at the endof the year

% change during

the yearDemat Physical Total % of Total

Shares

Demat Physical Total % of Total

Shares

A. Promoters

(1) Indiana) Individual/HUF 4,597,377 - 4,597,377 12.70% 4,597,377 - 4,597,377 11.40% -1.30%b) central Govt. or State Govt. - - - - - - - - - c) Bodies corporates 13,940,019 - 13,940,019 38.50% 18,067,019 - 18,067,019 44.80% 6.29%d) Banks/Financial Institutions - - - - - - - - - e) Any other - - - - - - - - - SUB TOTAL:(A) (1) 18,537,396 - 18,537,396 51.20% 22,664,396 - 22,664,396 56.19% 4.99%

(2) Foreign

a) NRI- Individuals - - - - - - - - - b) Other Individuals - - - - - - - - - c) Bodies corporate - - - - - - - - - d) Banks/Financial Institutions - - - - - - - - - e) Any other - - - - - - - - - SUB TOTAL (A) (2) - - - - - - - - -

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

18,537,396 - 18,537,396 51.20% 22,664,396 - 22,664,396 56.19% 4.99%

B. PUBLIC SHAREHOLDING

(1) Institutions

a) mutual Funds - - - - - - b) Banks/Financial Institutions 67,663 - 67,663 0.19% 70,052 - 70,052 0.17% -0.01%c) central Government - - - - - - - - - d) State Government - - - - - - - - - e) Venture capital Fund - - - - - - - - - f) Insurance companies - - - - - - - - - g) FIIs 3,185,007 - 3,185,007 8.80% 713,081 - 713,081 1.77% -7.03%h) Foreign Venture capital Funds - - - - - - - - - i) Others (specify)SUB TOTAL (B)(1): 3,252,670 - 3,252,670 8.98% 783,133 - 783,133 1.94% -7.04%

(2) Non Institutions

a) Bodies corporatesi) Indian 2,587,166 3,900 2,591,066 7.16% 3,022,892 3,700 3,026,592 7.50% 0.35%ii) Overseas - - - - - - - - - b) Individuals - i) Individual shareholders holding nominal share capital upto Rs.1 lakhs

6,467,888 307,938 6,775,826 18.72% 8,048,781 300,578 8,349,359 20.70% 1.99%

ii) Individual shareholders holding nominal share capital in excess of Rs. 1 lakhs

3,604,817 - 3,604,817 9.96% 3,187,323 - 3,187,323 7.90% -2.05%

c) Others (specify) - - - - - - c-i) Public Trust 760 - 760 0.00% - - 0.00%c-ii) clearing members 227,615 - 227,615 0.63% 300,634 - 300,634 0.75% 0.12%c-iii) NRI's/ OcB'c 386,811 65,700 452,511 1.25% 874,331 64,800 939,131 2.33% 1.08%c-iv) HUF 450,393 - 450,393 1.24% 412,034 - 412,034 1.02% -0.22%c-v) Qualified Foreign Investor- corporate

296,206 - 296,206 0.82% 653,658 - 653,658 1.62% 0.80%

SUB TOTAL (B)(2): 14,021,656 377,538 14,399,194 39.77% 16,499,653 369,078 16,868,731 41.82% 2.05%

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

17,274,326 377,538 17,651,864 48.75% 17,282,786 369,078 17,651,864 43.77% -4.99%

C. Shares held by Custodian for GDRs & ADRs

16,000 - 16,000 0.04% 16,000 - 16,000 0.04% 0.00%

Grand Total (A+B+C) 35,827,722 377,538 36,205,260 100% 39,963,182 369,078 40,332,260 100% -



(ii) Share Holding of Promoters

Sl No.

Shareholder's Name Shareholding at the beginning of the year

Shareholding at the end of the year

% Change in share holding during

the year

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

1 PSl Engineering Pvt. ltd. 3,713,520 10.26% - 3,713,520 9.21% - -1.05%2 Fedders Sales Pvt. ltd.

(Formerly lloyd Sales Pvt. ltd.) 3,315,005 9.16% - 3,315,005 8.22% - -0.94%

3 Airserco Pvt. Ltd. 3,304,133 9.13% - 3,304,133 8.19% - -0.93%4 Fedders manufacturing Pvt. ltd.

(Formerly lloyd manufacturing Pvt. ltd.) 1,653,416 4.57% - 2,253,416 5.59% - 1.02%

5 Perfect Radiators And Oil coolers Pvt. ltd. 1,243,845 3.44% - 1,643,845 4.08% - 0.64%6 Brij Raj Punj 1,617,983 4.47% - 1,617,983 4.01% - -0.46%7 Renu Punj 1,553,994 4.29% - 1,553,994 3.85% - -0.44%8 Himalayan mineral Waters Pvt. ltd. 160,000 0.44% - 1,323,500 3.28% - 2.84%9 Pandit Kanahaya lal Punj Pvt. ltd. 350,000 0.97% - 1,313,500 3.26% - 2.29%

10 Bharat Raj Punj 814,600 2.25% - 814,600 2.02% - -0.23%11 Fedders Credits Ltd.

(Formerly lloyd credits ltd.) 200,000 0.55% - 600,000 1.49% - 0.94%

12 Fedders Stock & Investments Pvt. ltd. (Formerly lloyd Stock & Investments Pvt. Ltd.)

- 0.00% - 600,000 1.49% - 1.49%

13 Brinda Jajoo 261,600 0.72% - 261,600 0.65% - -0.07%14 Bhavna Sareen 255,200 0.70% - 255,200 0.63% - -0.07%15 Brij Raj Punj (HUF) 94,000 0.26% - 94,000 0.23% - -0.03%16 Fedders Electric & Engineering ltd.

(Formerly Fedders lloyd corporation ltd.) 100 0.00% - 100 0.00% - 0.00%

Total 18,537,396 51.20% - 22,664,396 56.19% - 4.99%

(iii) Change in Promoters’ Shareholding

Sl. No. Share holding at the beginning of the Year

Cumulative Share holding during the year

No. of Shares % of total shares of the

company

No of shares % of total shares of the

company

1 PSL Engineering Pvt. Ltd.

At the beginning of the year 3,713,520 10.26% 3,713,520 9.21%

Date wise increase/decrease in Promoters Share holding during the year specifying the reasons for increase/decrease (e.g. allotment /transfer /bonus /sweat equity etc).

No Change

At the end of the year 3,713,520 9.21% 3,713,520 9.21%

2 Fedders Sales Pvt. Ltd. (Formerly Lloyd Sales Pvt. Ltd.)



No Change


Contd...


33




company


company

3 Airserco Pvt. Ltd.



No Change


4 Fedders Manufacturing Pvt. Ltd. (Formerly Lloyd Manufacturing Pvt. Ltd.)



Allotment of 2,00,000 Equity Shares on 03.09.2016 and 4,00,000 Equity Shares on 08.09.2016, pursuant to conversion of equivalent number of warrants alloted on preferential basis.


5 Perfect Radiators And Oil Coolers Pvt. Ltd.





6 Brij Raj Punj



No Change


7 Renu Punj



No Change


8 Himalayan Mineral Waters Pvt. Ltd.

At the beginning of the year 160,000 0.44% 1,323,500 3.28%




9 Pandit Kanahaya Lal Punj Pvt. Ltd.

At the beginning of the year 350,000 0.97% 1,313,500 3.26%




Contd...






company


company

10 Bharat Raj Punj

At the beginning of the year 814,600 2.25% 814,600 2.02%


No Change

At the end of the year 814,600 2.02% 814,600 2.02%

11 Fedders Credits Ltd. (Formerly Lloyd Credits Ltd.)



Allotment of 2,00,000 Equity Shares on 03.09.2016 and 2,00,000 equity shares on 08.09.2016, pursuant to conversion of equivalent number of warrants alloted on preferential basis.


12 Fedders Stock & Investments Pvt. Ltd. (Formerly Lloyd Stock & Investments Pvt. Ltd.)

At the beginning of the year - - 600,000 1.49%




13 Brinda Jajoo



No Change


14 Bhavna Sareen



No Change


15 Brij Raj Punj (HUF)



No Change


16 Fedders Electric & Engineering Ltd. (Formerly Fedders Lloyd Corporation Ltd.)

At the beginning of the year 100 0.00% 100 0.00%


No Change

At the end of the year 100 0.00% 100 0.00%


35

(iv) Shareholding Pattern of top ten Shareholders (other than Direcors, Promoters & Holders of GDRs & ADRs)

Sl. No. Name of the Shareholder Shareholding Cumulative Shareholding during the year.

No.of Shares % of total Shares of the

Company


Company

1 Orange Mauritius Investments Limited*

At the beginning of the Year 1,601,170 4.42% 1,601,170 4.42%

Bought during the year: - - - -

Sold during the year: (901,170) -2.35% 700,000 1.74%


2 Vanaja Sundar Iyer+

At the beginning of the Year - - - -

Bought during the year 530,000 1.31% 530,000 1.31%

Sold during the year (92,986) -0.23% 437,014 1.08%


3 Dolly Khanna*

At the beginning of the Year 232,626 0.64% 232,626 0.64%




4 EM Resurgent Fund*


Bought during the year - - - -

Sold during the year - - - -


5 Mauryan First+





6 Pacific Fortune Capital Limited+



Sold during the year - - - -


7 Zenith Impex Pvt. Ltd. *





8 SI Investments And Broking Private Limited+





Contd...



Sl. No. Name of the Shareholder Shareholding Cumulative Shareholding during the year.


Company


Company

9 Angel Broking Pvt. Ltd.+





10 MV Scif Mauritius+





11 HSBC Bank (Mauritius) Limited #



Sold during the year (411,525) -1.14% - -

At the end of the year - - - -

12 OHM Stock Broker Pvt. Ltd.#



Sold during the year (332,000) 0.92% - -


13 LTS Investment Fund Ltd.#



Sold during the year (319,772) 0.88% - -


14 Swiss Finance Corporation (Mauritius) Ltd.#



Sold during the year (316,918) -0.88% - -


15 Tarun S Jain#





16 Rahul Dhruv#



Sold during the year -208840 -0.52% - -


Note: The above information is based on the weekly beneficiary position received from the Depositories. Date wise increase & decrease in Shareholding of the Top-10 Shareholders is available on the website of the company i.e. www.leelelectric.com(*) in top 10 at beginning as well as at the end (#) in top 10 only at the beginning (+) in top 10 only at the end


37

(v) Shareholding of Directors & KMP

Sl. No. For Each of the Directors & KMP Share holding at the beginning of the Year



company


company

1 Brij Raj Punj


Date wise increase/decrease in KmP’s holding during the year specifying the reasons for increase/decrease (e.g. allotment/ transfer/bonus /sweat equity etc)

No Change


2 Bharat Raj Punj


Date wise increase/decrease in KmP’s holding during the year specifying the reasons for increase/decrease (e.g. allotment/ transfer/ bonus/sweat equity etc)

No Change


3 Mukat B. Sharma

At the beginning of the year - - - -

Date wise increase/decrease in KmP’s holding during the year specifying the reasons for increase/decrease (e.g. allotment /transfer/ bonus/sweat equity etc)

No Change


4 Nipun Singhal*


Date wise increase/decrease in KmP’s holding during the year specifying the reasons for increase/decrease (e.g. allotment /transfer/ bonus/sweat equity etc)

No Change


5 Achin Kumar Roy


Date wise increase/decrease in KmP’s holding during the year specifying the reasons for increase /decrease (e.g. allotment /transfer/bonus / sweat equity etc)

No Change


6 Anita K. Sharma (Company Secretary & VP Finance)


Date wise increase/decrease in KmP’s holding during the year specifying the reasons for increase/decrease (e.g. allotment / transfer/ bonus/ sweat equity etc)

No Change


*Mr. Nipun Singhal, resigned as w.e.f. May 8, 2017.



V INDEBTEDNESS

Indebtedness of the Company including interest outstanding/accrued but not due for payment (` in Lacs)

Secured Loans excluding deposits

Unsecured Loans

Deposits Total Indebtedness

Indebtness at the beginning of the financial year

i) Principal Amount 101,367.44 2,098.50 - 103,465.94

ii) Interest due but not paid 233.27 98.72 - 331.99

iii) Interest accrued but not due 60.84 - - 60.84

Total (i+ii+iii) 101,661.55 2,197.22 - 103,858.77

Change in Indebtedness during the financial year

Additions 13,059.31 - - 13,059.31

Reduction 4,249.97 2,197.22 - 6,447.19

Net Change 8,809.34 (2,197.22) - 6,612.12

Indebtedness at the end of the financial year

i) Principal Amount 110,470.89 - - 110,470.89

ii) Interest due but not paid 74.60 - - 74.60

iii) Interest accrued but not due 44.72 - - 44.72

Total (i+ii+iii) 110,590.21 - - 110,590.21

VI REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director, Whole time director and/or Manager: (` in Lacs)

Sl.No Particulars of Remuneration Name of the MD/WTD/Manager Total Amount1 Gross salary Brij Raj Punj Bharat Raj

PunjMukat B.

SharmaAchin Kumar

RoyNipun

Singhal

(a) Salary as per provisions contained in section 17(1) of the Income Tax Act, 1961.

77.76 58.32 43.20 95.32 46.04 320.64

(b) Value of perquisites u/s 17(2) of the Income tax Act, 1961.

- - 2.65 11.65 12.85 27.15

(c) Profits in lieu of salary under section 17(3) of the Income Tax Act, 1961.

- - - - - -

2 Stock option - - - - - -

3 Sweat Equity - - - - - -

4 Commission

-as % of profit - - - 50.00 41.40 91.40

-others, specify - - - - - -

5 Others, please specify (EPF)# - 4.67 3.60 9.37 5.52 23.16

Total (A) 77.76 62.99 49.45 166.34 105.81 462.35

Ceiling as per the Act (@ 10% of profits calculated under Section 198 read with Section 197 of the Companies Act, 2013)

1,232.75

#Note: EPF means Employer’s contribution to Provident Fund.


39

B. Remuneration to other directors: (` in Lacs)

Sl.No Particulars of Remuneration Name of the Directors Total Amount1 Independent Directors Deepti

SahaiAjay

DograSurjit

Krishan Sharma

Geeta Ajit Tekchand

Ramesh Kumar

Vasudeva(a) Fee for attending board/committee meetings. 0.75 0.75 0.75 0.75 0.75 3.75

(b) Commission - - - - - -

(c) Others, please specify - - - - - - Total (1) 0.75 0.75 0.75 0.75 0.75 3.75

2 Other Non Executive Directors(a) Fee for attending board committee meetings - - - - - (b) Commission - - - - - (c) Others, please specify. - - - - - Total (2) - - - - - Total (B)=(1+2) 0.75 0.75 0.75 0.75 0.75 3.75 Total Managerial Remuneration (A+B) 466.10Ceiling as per the Act (@ 11% of profits calculated under Section 198 read with Section 197 of the Companies Act, 2013)

1,356.03

C. REMUNERATION TO KEY MANAGERIAL PERSONNEL OTHER THAN MD/MANAGER/WTD (` in Lacs)

Sl.No Particulars of Remuneration Key Managerial Personnel Total Amount1 Gross salary CEO Company

SecretaryCFO*

(a) Salary as per provisions contained in section 17(1) of the Income Tax Act, 1961. - 21.90 - 21.90 (b) Value of perquisites u/s 17(2) of the Income Tax Act, 1961. - 12.35 - 12.35(c) Profits in lieu of salary under section 17(3) of the Income Tax Act, 1961. - - - -

2 Stock option - - - - 3 Sweat Equity - - - - 4 Commission - - - -

-as % of profit - - - -

-others, specify - - - -5 Others, please specify (EPF)# - 1.75 1.75

Total (A) - 36.00 - 36.00

*mr. mukat B. Sharma is the Wholetime Director & cFO of the company. Thus, cFO’s salary is shown in point VI A.#Note: EPF means Employer’s contribution to Provident Fund.

VII PENALTIES/PUNISHMENT/COMPOUNDING OF OFFENCESType Section of the

Companies ActBrief Description Details of Penalty /Punishment/

Compounding fees imposedAuthority (RD /NCLT / Court)

Appeal made if any (give details)

A. COMPANYPenalty

NAPunishmentcompoundingB. DIRECTORSPenalty

NAPunishmentcompoundingC. OTHER OFFICERS IN DEFAULTPenalty

NAPunishmentcompounding

On behalf of the BoardDate: 10.08.2017 Achin Kumar RoyPlace: New Delhi Wholetime Director & Chairman of the Meeting (DIN: 00080956)



Annexure 3 to the Board’s Report FORM No. MR-3

SECRETARIAL AUDIT REPORTFor The Financial Year ended on 31st March, 2017

(Pursuant to Section 204(1) of the Companies Act, 2013 and Rule No. 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014)

To,

The Members,LEEL Electricals Limited(Formerly known as Lloyd Electric & Engineering Limited) Unit No. 8, Block-B, Old istrict Courts Complex, Industrial Area, Phase-II, Noida, Uttar Pradesh 201305

We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by LEEL Electricals Limited (hereinafter called the Company). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing our opinion thereon.

Based on our verification of the Company’s books, papers, minute books, forms and returns filed and other records maintained by the Company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, we hereby report that in our opinion, the company has, during the audit period covering financial year ended on March 31, 2017 (“Audit Period”) complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended on March 31, 2017 according to the provisions of:

(i) The Companies Act, 2013 (the Act) and the rules made thereunder;

(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 thereunder;

(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder 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; and the Securities and Exchange Board of India Prohibition of Insider Trading) Regulations, 2015;

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

(d) The Securities and Exchange Board of India (Share Based employee Benefits) Regulations, 2014; (Not applicable to the Company during the audit period);

(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008; (Not Applicable as the Company has not issued any debt securities)

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

(g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; and (Not applicable to the Company during the audit period)

(h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998; (Not applicable to the Company during the audit period)


41

vi) Other Applicable Laws:

(a) Air (Prevention & Control of Pollution) Act, 1981

(b) The Factories Act, 1948 and Rules made there under

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

(a) Secretarial Standards issued by The Institute of Company Secretaries of India.

(b) The Listing Agreement entered into by the Company with the Stock Exchange,/ the SEBI (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 directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.

Majority decision is carried through while the dissenting members’ views are captured and recorded as part of the minutes (during the year under review there were no instance recorded in the minutes where any director has dissented to any particular resolution).

We further report that there are adequate systems and processes in the company commensurate with the size and operations of the company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

We report further that during the audit period:

a. The Company has amended Clause II of the Memorandum & Articles of Association of the Company by shifting its Registered office from the State of Rajasthan to the State of Uttar Pradesh with approval of shareholders by way of special resolution through postal ballot dated November 23, 2016 and in pursuance of the order of the Regional Director, North Western Region, Ahmedabad vide its order no. Company Application No. RD (NWR)/13/748/2017/4428 dated January 17, 2017. Consequent upon shifting of the registered office of the Company, the Registrar of Companies, Kanpur, Uttar Pradesh, vide its letter dated March 3, 2017 has allotted new Corporate Identity Number to the Company as L29120UP1987PLC091016.

b. The Company has also amended Clause I of the Memorandum & Articles of Association of the Company to change of its name so as to delete the word ‘Lloyd’ therefrom in view of the sale of Consumer Durables Business alongwith brand ‘Lloyd’ as a going concern on a slump basis to Havells India Ltd., with the approval of shareholders by way of special resolution through postal ballot dated February 18, 2017

c. As on the date of signing of this report, the name of the Company has been changed from Lloyd Electric & Engineering Limited to LEEL Electricals Limited which has been approved vide Special Resolution passed by the Shareholders through Postal Ballot Process on 23rd March, 2017. Further, the Company has obtained the final approval from the Registrar of Companies, Uttar Pradesh vide the Certificate of Incorporation dated 23rd May, 2017 certifying the change of name of the Company to “LEEL Electricals Limited.”

d. The Company has increased the borrowing powers of the Board from Rs. 2,000 Crores to Rs. 2,500 Crores with the approval of shareholders by way of special resolution through postal ballot process dated November 23, 2016.

e. The Company had issued and allotted 17,00,000 and 24,27,000 equity shares of Rs. 10/- each at a premium of Rs.142/- each to promoter group entities on preferential basis upon conversion of equivalent number of warrants on 03.09.2016 and 08.09.2016 respectively.

Sanjay ChughCompany Secretary

Place: New Delhi FCS No: 3754Date: August 10, 2017 C.P.NO. 3073

Note: This report is to be read with our letter of even date which is annexed as Annexure- A and forms an integral part of this report.



Annexure-A

To,

The Members,LEEL Electricals Limited(Formerly known as Lloyd Electric & Engineering Limited) Unit No. 8, Block-B, Old istrict Courts Complex, Industrial Area, Phase-II, Noida, Uttar Pradesh 201305

Our report of even date is to be read along with this letter.

1. Maintenance of secretarial record is the responsibility of the management of the company. Our responsibility is to express an opinion on these secretarial records based on our audit.

2. We have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness of the contents of the Secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records. We believe that the processes and practices, we followed provide a reasonable basis for our opinion.

3. We have not verified the correctness and appropriateness of financial records and Books of Accounts of the company.

4. Where ever required, we have obtained the Management representation about the compliance of laws, rules and regulations and happening of events etc.

5. The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the responsibility of management. Our examination was limited to the verification of procedures on random test basis.

6. The Secretarial Audit report is neither an assurance as to the future viability of the company nor of the efficacy or effectiveness with which the management has conducted the affairs of the company.

Sanjay ChughCompany Secretary

Place: New Delhi FCS No: 3754Date: August 10, 2017 C.P.NO. 3073


43

Annexure 4 to the Board’s Report Form No. AOC-2

(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014)

Form for disclosure of particulars of contracts / arrangements entered into by the company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arm’s length transactions under third proviso thereto:

1. Details of contracts or arrangements or transactions not at arm’s length basis

a. Name(s) of the related party and nature of relationship N.A.

b. Nature of contracts/arrangements/transactions N.A.

c. Duration of the contracts / arrangements/transactions N.A.

d. Salient terms of the contracts or arrangements or transactions including the value, if any N.A.

e. Justification for entering into such contracts or arrangements or transactions N.A.

f. Date(s) of approval by the Board N.A.

g. Amount paid as advances, if any: N.A.

h. Date on which the special resolution was passed in general meeting as required under the first proviso to section 188

N.A.

The Company has not entered into any contract or arrangement or transaction with its related parties which is not at arm’s length during financial year 2016-17.

2. Details of material contracts or arrangement or transactions at arm’s length basis

a. Name(s) of the related party and nature of relationship N.A.

b. Nature of contracts/arrangements/transactions N.A.

c. Duration of the contracts / arrangements/transactions N.A.

d. Salient terms of the contracts or arrangements or transactions including the value, if any: N.A.

e. Date(s) of approval by the Board, if any N.A.

f. Amount paid as advances, if any: N.A.

During the year under review, no material transactions, contracts or arrangements as defined under the listing agreement/ the SEBI (Listing Obligations and Disclosure Requirements), Regulations 2015 or which were above the threshold limits mentioned under Rule 15 of the Companies (Meetings of Board & its Powers) Rules, 2014 were entered with the related parties by the Company. For details on related party transactions, members may refer to the notes to the standalone financial statement.

Achin Kumar Roy Wholetime Director &Date: August 10, 2017 Chairman of the MeetingPlace: New Delhi DIN:01475456




Particulars of Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo required under the Companies (Accounts) Rules, 2014.

A. CONSERVATION OF ENERGY

The Company believes in the philosophy that use of low energy path is the best way towards a sustainable future. Energy conservation is the method we can reduce our daily energy consumption by using less energy service. It is very necessary to maintain the availability of the natural resources for the continuity of life on this planet. Being an Engineering Company, the Company has embedded a policy of reduce, reuse and recycle across all its processes. Company’s technical staff and engineers are trained to identify energy-saving opportunities and consistent efforts to improve performances have resulted in considerable reduction in the use of energy and natural resources.Your Company has taken appropriate measures for environment protection by adopting green and clean technologies and designing pollution control infrastructure to achieve discharge and emissions within the statutory limits.

A few initiatives taken by your Company towards energy conservation during the year under review:

The Company has setup Sewage Treatment Plant (STP) in Bhiwadi factory for recycling of water. Recycled water is being used in horticulture. After installing the STP, the factory is saving 2000 Kilolitres water per day.

The Company has also set up Effluent Treatment Plant (ETP) in Pant Nagar Factory for waste disposal and cleanliness.

Electric lights in the plants have been/is being converted in to LED lights to conserve the Energy.

Halogen Bulbs have been changed to LED lights & New FRP sheets has been installed on roof to use daylight in Coil Shop area to save the electricity. 10% electricity consumption is being saved with this activity.

Use of electrical equipment’s with high energy efficiency and low anti-environment emissions.

Continuous inspection of factories for plugging in air leakages and water Leakages.

Switching off utility machines during off times.

Use of portable air compressor during partial load condition to conserve energy.

Rain water harvesting continues to be a focused activity at our manufacturing plants.

The Company is maintaining green area in its every factory and in its surroundings.

Steps taken for utilizing alternate sources of energy:

LPG is being used instead of Diesel as an alternate source of fuel to run the ovens. It will reduce fuel cost as well carbon emission.

Wind operated powerless ventilators for plant ventilation in Pantnagar manufacturing plant.

Sky lights being used instead of powered lights on first floor manufacturing line in Pantnagar.

All boundary lights are being converted into solar power.

Capital Investment on energy conservation equipments:

No Capital investments were incurred during the previous year.

B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

Technology and innovation continue to be one of the key focus areas to drive growth of the Company besides ensuring sustainability and helping the Company to take a leap in transformation. LEEL Rail HVAC division’s production engineers have received extensive


45

training in Toshiba’s plant Japanese team, consisting of manufacturing / Quality/testing personnel have been stationed in Bhiwadi plant, are continuously upgrading the skills of our workmen and engineers. LEEL Rail HVAC Division is also absorbing Technology from its overseas plants, primarily from its Wholly Owned Subsidiaries viz; Noske Kaeser (R&V) situated in Germany & New Zealand. Close Technical coordination has helped LEEL Bhiwadi to beg a very prestigious order from GE, US.

In addition to developing new products and technologies for existing businesses/ manufacturing facilities, the group is also working on building capabilities to develop breakthrough technologies that will create new business for the Company. Training is imparted to technical staff as an ongoing process.

C. RESEARCH AND DEVELOPMENT

In order to meet with the growing demand for latest technology products and to compete in the market place, your Company continued its efforts in strengthening the R&D activities. Efforts continued to enhance the in-house capabilities to bring in operational efficiencies and product up-gradation to meet the customer needs at both domestic and international front.

Specific areas in which R & D carried out by the Company

To bring innovation and improve upon its area of operation to be at par with International Standards during the year under review, Our R&D team has contributed to design optimization of standard range of products for several customers.

Highlights of products and processes developed by your Company during the year under review include:

Development of energy efficient models ranging from 2/3/5 star rated split air conditioners as per the new BEE standards.

Development of DC inverter airconditioner for OEM market.

Developed and qualified Window AC product with CB certification for UAE market.

Development of new generation PLC based controllers for metro rail HVAC units.

Development of Heat Exchangers (condensers) using micro channel technology.

Development of Heat and Cool Split AC with R-410A and R-32 refrigerants.

Development of Split AC with scroll compressor.

Up gradation of Ac test lab standards as per ISO 17025.

Development of Roof Mounted Packaged Units with environment friendly refrigerants for LHB and conventional coaches of Indian Railways.

Benefits derived as a result of above R&D

The development of new products has helped the company to remain at the top of cutting edge technology and has resulted in continuity of our relationship with key customers. Having a diverse product portfolio with star rated products helped the Company in improving the market share. Your Company enhanced its customer base with some of the leading Indian and Overseas brands.

Expenditure incurred on Research and Development

Capital Expenditure:Taken as Fixed Assets and depreciation is provided accordingly.

Revenue Expenditure: Charged out of expenses through the respective heads of accounts.

D. FOREIGN EXCHANGE EARNING AND OUTGO

Total Foreign Exchange used and earned: (` in Crores)

Particulars 2016-17 2015-16

Foreign Exchange Earnings 110.60 55.79

Foreign Exchange Outgo 1,397.63 1,047.60




The information required under Section 197(12) of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

1. The ratio of the remuneration of each director to the median remuneration of the employees of the company for the financial year 2016-17 and the percentage increase in remuneration of director and chief financial officer in the financial year 2016-17:

Sl. No. Name Designation Ratio of Remuneration of each Director to the

Median Remuneration of Employees

% Increasein Remuneration

1 Mr. Brij Raj Punj Chairman & Managing Director 35:1 8%

2 Mr. Bharat Raj Punj Deputy Managing Director 26:1 8%

3 Mr. Achin Kumar Roy Whole Time Director 68:1 6%

4 Mr. Nipun Singhal Whole Time Director 45:1 8%

5 Mr. Mukat B. Sharma Whole Time Director & CFO 22:1 10%

Note:

(i) % increase in remuneration includes salary, PF, other allowances, lease accommodation provided but does not include leave encashment, payment of past arrears and perquisites yet to be claimed after the date of balance sheet pertaining to financial year.

(ii) % increase in remuneration does not include performance based commission paid with the approval of shareholders.Details of commission paid is given in corporate governance report and Annexure 2 of Board’s Report. Please refer the same.

(iii) Non-Executive Independent Directors of the Company are entitled for sitting fees and reimbursement of expenses as per the statutory provisions and are within the prescribed limits. The details of sitting fees of independent directors are provided in the Corporate Governance Report forms a part of the Annual Report. There is no change in sitting fees of the Non-Executive Independent Director during the FY 2016-17.

2. The percentage increase in the remuneration of Company Secretary was 34% in the Financial Year 2016-17. There is no Chief Executive Officer in the Company designated as such and for % increase in remuneration of CFO please see point 1 above.

3. The percentage increase in the median remuneration of employees in the financial year 2016-17 was around 9.8%.

4. The number of permanent employees on the rolls of company: 1,654

5. The average increase in percentile of salaries of employees other than managerial personnel in the financial 2016-17 was 9%. Percentage increase in the managerial remuneration for the year was 8% (excluding commission paid during the financial year to executive directors.)

6. It is hereby affirmed that the remuneration paid during the financial year 2016-17 is as per the Remuneration Policy of the Company.

Achin Kumar Roy Wholetime Director &Date: August 10, 2017 Chairman of the MeetingPlace: New Delhi DIN:01475456


47

MANAGEMENT DISCUSSION & ANALYSIS REPORTECONOMIC SCENARIO AND OUTLOOK

The Indian economy witnessed another challenging year. India’s GDP registered a slow growth of 7.1% in the financial year 2016-17 as compared to 7.6% of previous year. The industry and services sectors decelerated further during the year, recording the slowest growth in three years.

The Financial Year 2016-17 could behold as an economic cleansing as far as India’s growth story is concerned, from initializing the implementation of long awaited GST to sudden shocker of Demonetisation, Indian government asserted blunt to deliver time bound and hard hitting reforms to make India’s economy vigorous to attain robust economic growth.

Demonetisation had temporarily slowed down economic activities in the third quarter due to cash crunch. Almost all sectors, with the exception of agriculture, showed deceleration after demonetisation. The favourable monsoon and wage increase post-implementation of the 7th Pay Commission has spurred the consumption and in turn helped the economy to come out from slowdown.

In February 2016, India overtook China as the fastest growing major economy in the world amid a failing global economy; However, we can term the financial year 2016-17 as a year of surprises and least speculated as the events happened during the year was either adversely or not being speculated by the experts both in political and economic arena. The decision of setting up a Monetary Policy Committee (MPC) to raising transparency in rate-setting decisions of the Central Bank provides RBI to consider multiple factors such as inflation, growth, employment, banking stability and exchange rate stability to make a rate decision with much firmness. Moreover, with anticipated growth in Foreign Direct Investment (FDI), several international players are expected to enter and start operations in the Indian retail market which is expected to further fuel the consumer market to a new high.

India is an emerging economy and thus the domestic market is moving very fast towards the durables products. With the constant rise in disposable income of people, easy availability of credit and finance, rapid urbanization and easy accessibility to e-commerce portals via internet, the importance of high end products are growing in India at a high pace. By 2025, India would rise from the 12th to the 5th largest position in the consumer durables market in the world. Global corporations view India as one of the key markets from where future growth is likely to emerge. The growth in India’s consumer market would be primarily driven by a favorable population composition and increasing disposable incomes.

Global GDP, after witnessing a slowdown, is projected to pick up modestly to around 3.05% in 2018, from just under 3% in 2016, boosted by fiscal initiatives in the major economies. Economic conditions are solidly improving as healthy global demand and rising consumer spending are propelling economic growth. Moreover, downside risks that threatened global economic activity this year such as political instability in Europe, rising trade protectionism following the election of the President, in US in November, 2016 and a slowdown in China have not disappeared, but they have certainly diminished.

INDUSTRY STRUCTURE AND DEVELOPMENT

Industry Structure

Heating Ventilation Air Conditioning & Refrigeration (HVAC&R) systems are becoming one of the key building blocks in the modern infrastructure. The market size of heat exchanger is estimated to grow from USD 13.89 Billion in 2017 to USD 20.65 Billion by 2022, at a CAGR of 8.3% from 2017 to 2022. The high growth is attributed to the growing building & construction industry and increased government investments in infrastructure projects resulting in installation of HVAC&R systems. With healthy growth anticipated in the real estate sector, the country is expected to witness strong infrastructure development, which would boost the market for HVAC systems over the next five years. The Indian market is projected to grow at a CAGR of 9.48% over the next four years. Growing urbanization is fuelling the construction of retail, hospitality, and commercial properties and in turn, expanding the market. As a result of the growing momentum toward smart cities, it is expected that the demand for air cooling systems will continue to grow.

The room air conditioning segment has been capturing majority revenue share in the Indian HVAC&R market and the same trend is expected to retain its dominance in 2019 also. This is largely due to portability, ease of installation and less space requirement by room air conditioning systems. Factors like easy availability of finance, growth in consumer base of rural sector, fall in prices due to increased competition and several proposed residential projects, rapid growth of media and social media have become key growth drivers for the industry. Consequently, on account these factors, segment share of room air conditioners in the Indian HVAC market is expected to increase over the next five years.



India is also emerging as one of the fastest growing transport air conditioner & refrigeration markets in the Asia-Pacific region. Owing to government infrastructure projects such as metro rails, expansion of state & national highways and rising disposable income on travelling and adoption of comfortable lifestyle are expected to fuel the market for transport air conditioner & refrigeration market in India. Increased number of tourists would boost the demand for transport air conditioner & refrigeration systems in the country and it is forecasted that demand for AC coaches with Indian Railways is expected to grow at the rate of approximately 20% every year.

The global HVAC&R Market is basically influenced by growth drivers such as technological advancements which drive demand of the market with high growth rates, extreme weather conditions, growth of population, steady urban development, increase in construction activities in the residential, commercial and industrial sectors and development of transport systems. Due to these factors it is expected that global HVAC market is to grow steadily. One of the primary drivers for this market is the rise in the preference for condensing boilers. Countries with extreme climatic conditions prefer HVAC systems for both cooling and heating purposes. Further, as part of the energy efficiency, renovation of buildings by replacing the old HVAC systems with modern variants is also driving the growth of the global HVAC market. The reduction in operating costs, increase in energy efficiency, and favorable government incentives have spurred the need for replacing existing HVAC components and parts in the US, the UK and Germany.

BUSINESS OVERVIEW

Your Company is one of the largest manufacturer of evaporators and condenser coils for air conditioners and heat exchangers/ radiators serving the entire spectrum of Heating, Ventilation, Air Conditioning and Refrigeration (HVAC&R) Industry, with an in-depth understanding of efficient manufacturing processes. With cutting edge technology, your Company continues to deliver wide range of products and industrial solutions to its customers across the country and overseas.

With its in-house capacity to design, develop, manufacture and maintain highly engineered HVAC systems, LEEL is uniquely positioned in the HVAC systems space as well as in the heat transfer industry. On standalone basis the Company derived 18% of its total revenue from sales of evaporators, heat exchangers and components.

The Company is an ‘Original Equipment Manufacturer’ (OEM) supplier to major manufacturers/sellers of air-conditioner in India and provides customized air-conditioning solutions for institutional clients like Indian Railways, Metro Rail etc. On the Standalone basis your Company derived 27% of its total revenue from OEM and packed air conditioning segment.

Your Company is vertically integrated across HVAC value chain from manufacturing the heat exchanger / coils, components, air conditioners to selling to OEM’s and under its own brand thereby providing an end to end solution in the air conditioning space.

OEM Segment & Packaged Air Conditioning

Your Company is one of the top supplier of room air conditioners to the major brands in India as well as overseas. The Company has global presence with six state-of-art manufacturing facilities located in Bhiwadi, (Rajasthan), Tauru (Haryana), Pantnagar (Uttarakhand), Kala-amb (Himachal Pradesh), Ranipet (Tamil Nadu), Haridwar (Uttarakhand) in India and two overseas manufacturing facilities in Prague, Czech Republic in Europe and one in New Zealand. All the manufacturing facilities are equipped with high grade delivery technologies, latest equipment and large scale manufacturing facility. The products manufactured are wide range of room air conditioners including inverter air conditioners, Roof Mounted Air conditioners, wide range of heat exchangers, air handling units, fans and other components.

It is expected that the penetration level in room air conditioner will go faster in the near future due to increased availability of power and the higher per capita income of the Indian residents. To cater the increased demand, the installed capacities are also being augmented in view of future requirement of air conditioners in India.

The Company has started the manufacturing of inverter air conditioners, being designed and developed by the Company and the Company is also receiving repeated orders from the customers. The other variant of ACs being manufactured by the Company like split and window Ac’s are energy efficient star rated products as per BEE (Bureau of Energy Efficiency) norms.

The energy efficient products will play a vital role for the future of the air conditioners in India and around the globe as almost all the countries are focusing on energy efficiency products. The global HVAC business is changing in terms of energy conservation. Montreal Agreement and other environment conservation protocols have phased out the earlier refrigerants which were used in manufacturing of air conditioners and new refrigerants such has 401A, R32, R290 are becoming popular. Accordingly, the Company is focusing more on R&D and developing newer and finer products, which will not only meet consumers’ expectations in terms of energy efficiency but global standards for environmental, health & safety.


49

Heat Exchangers & Components

The growth in retail, hospitality and commercial sectors is significantly boosting the demand for HVAC systems in the country and as a result CAGR of 9.48% over the next four years growth is projected for the market of air conditioners

Further, introduction of new technologies, reduction of prices, increasing number of household units and more emphasis on energy efficient products also fueling need of new innovations amongst the market players.

Your Company is one of the largest Heat Exchanger manufacturers in India. The Company’s extensive range of condenser and evaporator coils are used as original equipment in residential and light commercial unitary products, central plants including Air Handling Units (AHU), commercial refrigeration, precision and transport air conditioning applications.

The Company is also a supplier of HVAC systems to Rail/Metro/ defence applications. The Company has its strong presence in packaged air conditioning and oil cooler segment of the Indian Railways. Since the Company has captive facility for sheet metal fabrication and heat exchanger coils, which gives an added advantage and control over quality over such critical components. In future, it looks quite promising since currently only 40% of Indian Railway coaches have built in air condition, which is likely to be increased to about 60% over the next few years.

The Company has also made foray into manufacturing of HVAC to be used by the Delhi Metro Rail Corporation (DMRC) through technology transfer with Toshiba, Japan. Access to Toshiba technology will help the Company into bidding favorably for metro projects for times to come and also ‘Make in India’ initiative of the Government of India would further strengthen future prospects in this segment. In the defence segment, Indian corporate are set to bag large defence orders; this will bring additional opportunity for participating into defence segment through the existing product portfolio of the Company.

Further, with the background of fast track growth in Railways & Defense sector, coupled with “Make in India” drive, brought enormous opportunities for LEEL to reaffirm existing order book and a need to create additional capacity. The Company extended this opportunity by attracting the Aviation Sector; the Company is designing a complete Oil Cooling System for its latest Aviation and Defense applications. As a prerequisite for Aviation, Space and Defense requirement, LEEL is strengthening its own quality systems and production processes by becoming ready for AS9100 and NadCap certifications, continuing on its core strength of manufacturing the mechanically Bonded Radiators.

Consumer Durable

During the year, the Consumer Durable Segment for the branded products portfolio contributed to 55% of the standalone revenue of the Company. The Company’s consumer durable product portfolio included products like air purifiers, inverter Air Conditioners, Air Conditioners with Wi-Fi technology, portable Air Conditioners, dry coolers, state-of-the-art air conditioners, Ultra HD technology LED TV’s, Washing Machines, Chest Freezers, Refrigerators, Room Heaters, and other small appliances.

On May 8, 2017, the Company has completed the sale of its consumer durable business alongwith the ‘Lloyd’ brand and all associated intellectual properties including the brand, logo and the trademarks alongwith specified assets and liabilities including transfer of employees, contracts and approvals relating to this undertaking on a going concern basis to Havells India Ltd. by way of slump sale. This transaction has been commensurated at an enterprise value of Rs.1,550 Crores subject to closing adjustment. No manufacturing facility has been sold as the part of the transaction and company would continue with its existing business of manufacturing of air conditioners, as OEM suppliers for other brands, package air conditioning for railways and heat exchanger business with its core competencies.

STANDALONE FINANCIAL HIGHLIGHTS

For the financial year ended March 31, 2017, on standalone basis, the revenue from the operations grew by 27% to Rs.3,024 Crores as compared to Rs.2,389 Crores during the previous year. Operating profit for the year was higher by 4% to Rs.274 Crores as compared to Rs.264 Crores in the previous year. The profit before exceptional item and the tax stood at Rs.119 Crores as compared to Rs.125 Crores during the last year mainly due to increase in finance cost to Rs.118 Crores as against Rs.105 Crores during the previous year as a result of the working capital borrowings. The profit after exceptional item and tax stood at Rs.85 Crores as against Rs.56 Crores during the previous year thereby registering growth of 52%. The total comprehensive income for the year stood at Rs.85 Crores as compared to Rs.56 Crores during the previous year.



On the consolidated basis, the revenue from the operations for the year ended March 31, 2017 was Rs.3,376 Crores as compared to Rs.2,729 Crores during the previous year registering a growth of 24%. Operating profit for the year was marginally higher to Rs.273 Crores as compared to Rs.262 Crores in the previous year. The consolidated profit before exceptional item and tax stood at Rs.104 Crores and after tax was Rs.70 Crores as compared to Rs.111 Crores and Rs.42 Crores respectively during the previous year. The total comprehensive income for the year stood at Rs.70 Crores as compared to Rs.42 Crores during the previous year. The decline in profitability was on account of difficult market conditions which prevailed in France and Spain where subsidiaries observed lower sales volume.

Last five years performance in terms of EBITDA & Revenue

EBITDA

EBITDA

2012-13

145.88 189.58 225.26 263.77 273.84

2013-14 2014-15 2015-16 2016-17

300

250

200

150

100

50

0

` in Crores

3500

3000

2500

2000

1500

1000

500

0

STANDALONE REVENUE

REVENUE

2012-13

1175.3

1175.3

1451.72

1451.72

1834.96

1834.96

2387.63

2387.63

3022.43

3022.43

2013-14 2014-15 2015-16 2016-17

Note: Figures of FY 2015-16 and 2016-17 have been regrouped and calculated as per the Accounting Standards.

INTERNATIONAL OPERATIONS AND ITS FINANCIAL HIGHLIGHTS

Your Company has 5 Direct Wholly Owned Subsidiaries(WOS) viz; Lloyd Coils Europe s.r.o., Janka Engineering s.r.o., Noske Kaeser Rail & Vehicle Germany GmbH, Noske Kaeser US Rail & Vehicle LLC, Noske Kaeser Rail & Vehicles New Zealand Ltd. and 2 Indirect WOS through Noske Kaeser Rail & Vehicles New Zealand Ltd. viz; Noske-Kaeser Rail & Vehicle Australia Pty Ltd. and Noske-Kaeser Empreendimentos e Participaçôes do Brasil Ltda. as of the end of the financial year:

Lloyd Coils Europe s.r.o.(‘LCE’): The total sales of LCE was dropped by 10% to Euro 31.1 Million as compared to Euro 34.5 Million in previous year due to the difficult market condition in France and Spain where the subsidiary observed lower quantities by the customers across the segments. Despite the negative market trends it achieved excellent growth of nearly 30% in the segment of Data Centres Cooling. Total sales in this new segment after two years of activity were at Euro 3.5 Million and it is expected to reach Euro 4.5 Million next year. About 6% growth has been reported from Poland, which is in line with the general market development in this region. Due to 10% drop of total sales volume, LCE has not been able to significantly increase profit in this year. However, several actions have been successfully implemented on both cost and sales side, which led to solid improvements of achieved margins. The negative volume effect has however erased this impact on the EBITDA line, which hence stayed at similar level as last year. The objective for coming year is therefore, a turnaround of the declining volume trend of recent years by introducing new customers and extending product range for existing customers, to be able to compensate for the suffered losses in Russia and difficult economic situation in France and other EU countries.

Janka Engineering s.r.o.(‘Janka’): Lower sales volume was also the important factor for Janka this year. The turnover of Janka declined by about 6% from the last year and reached Euro 11.3 Million. However, the Janka has undertaken revitalization project mainly focusing on product design, procurement and personnel. Despite of sluggish performance, Janka has secured large project to supply AHUs for prestige Jaguar car production plant in Slovakia. In the rail segment, Janka has been supplying AC units for Prague trams, which will also continue during next financial year. Besides, Janka has completed two projects with newly acquired Noske Kaeser Rail & Vehicle for West-European customers. It has also secured first project from Pesa, a leading Central European rolling stock manufacturer, to deliver AC units to trams for city Bydgoszcz in Poland during FY 2017-18.


51

Noske Kaeser Rail & Vehicle Germany GmbH(NK Germany): For NK Germany it was the first twelve months’ financial year under LEEL’s ownership. Total sales reached Euro 4.8 Million with roughly 80% of sales for new-mount HVAC systems and 20% for spare parts and service, however, the EBITDA was at breakeven. Main projects supplied during the year were Bogestra saloon and driver’s cab HVAC system for Stadler Pankow; Stuttgart saloon and driver’s cab HVAC system for Stadler Pankow; Basel/Geneva saloon HVAC systems and transmission re-cooling units for Stadler Altenrhein; Aarhus transmission re-cooling units for Stadler Altenrhein and Monorail Bologna driver´s cab HVAC systems for Intamin Liechtenstein, the last two of them being manufactured by Janka Engineering in Prague.

The Commercial HVAC and Refrigeration industry is, due to their close link to construction segment, very much dependent on economic environment in each country e.g. there is good market development in Germany and Central Europe while South-West EU countries and Russia are suffering a decline. Except, Data Centre Cooling segment, it has seen slight slowdown in heat pump business and substantial decline in milk tank segment due to extremely low commodity prices in this industry. Industrial cooling segment remains mostly flat as return of growth being blocked by continuing low level of energy prices.

Noske Kaeser Rail & Vehicles New Zealand Ltd. (including its subsidiaries in Australia and Brazil) (‘NK NZ’): During the period under review, NK NZ alongwith its subsidiaries reported total revenue of NZD 6.7 Million, profit before tax stood at NZD 0.09 Million, profit after tax stood at NZD 0.06 Million and total comprehensive income stood at NZD 0.07 Million. The previous year’s financials of the NK NZ are not comparable with the current year’s financials as the financial year of NK NZ has been changed from September to March in the FY 2016 after being acquired by the Company (LEEL) so to align with the Company’s financial year.

NK NZ continued to deliver HVAC units to the Vlocity DMUs in Melbourne, with follow on orders received during the year. In addition to this, it has also secured a follow-on order for Perth B-Series EMU HVAC units which will be delivered by next financial year.

NK NZ was instrumental in securing the GE India locomotive HVAC contract for LEEL Electricals Ltd. and worked with the Company’s Bhiwadi plant during the design and prototype phases of the project.

The service operation in Australia continues to deliver several successful HVAC unit overhaul programs and provides on-going maintenance support to a number of key customers in Perth and Melbourne. A key success was securing the Alstom C1-class tram maintenance and repair work with Yarra Trams. The market conditions of brazil remained subdued during the period under the review.

EXPORTS

The Company supplies air conditioners as OEM to major brands in Middle East, Nepal & Sri Lanka. For the heat exchangers, the Company is focusing on US and European market by providing value added products across all the categories. Being IRIS (International Railway Industry Standard) certified, the Company is also exploring opportunity with the international rolling stock manufacturer for the HVAC system.

OPPORTUNITIES, THREATS, CONCERNS AND RISKS.

Opportunities

According to “India HVAC Market Forecast & Opportunities, 2019”, the HVAC market in India is forecast to reach USD 3.97 billion by 2019 on account of changing lifestyle, increasing per capita income, and rising expenditure by consumers on comfort solutions. The Indian HVAC market is also expected to witness growth on account of rising investments by corporates in India and rapid infrastructure development in the Country. However, with the rising demand for energy efficient products in the country, the HVAC market is expected to undergo significant brand shift over the coming years.

The growing population combined with government initiatives to promote the “Make in India” concept has heightened manufacturing activities and infrastructure development in the country. To encourage investment, the government of India is taking pro-active steps to improve ease of doing business such as minimizing clearances, simplify compliance, online approvals, lesser documentation, more investor friendly initiatives etc.

The air conditioner market poised for a 9% annual growth over the next couple of years and it is witnessing a steady shift in demand for integrated systems. With advancements in air conditioning technology and rising demand in both developed and developing regions, the air conditioning systems market is expected to experience high growth in the coming decade. With the rising disposable income of consumers, the need for replacement of obsolete systems, increasing awareness of energy-efficient and eco-friendly products, and



demand for intelligent air conditioning systems are some of the factors providing impetus to demand. The four key technological trends that are expected to dominate the air conditioning market over the next four years are:

Rising

popularity of

smart

thermostats

Introduction

of air-

purifier

technology

Increased

adaptability

of inverter air

conditioners

Greater

demand for

intgegrated

systems

Key

trends

Threats & Concerns

a) Competitive rivalry and price sensitive consumers have forced market players to keep the price low and expending more on advertisement lowering industry margins.

b) Threats of new entrants and continuous innovation and technology advancement leads to intense rivalry amongst the producers. Furthermore, major raw materials such as metals are exhibiting increasing trend over the past few years posing margin pressures.

c) As around 70 percent of India‘s population still lives in rural areas, availability of products to rural villages located in remote areas are difficult due to inadequate infrastructure and distribution channels and poor road connectivity.

d) India is still power deficit country and has been witnessing peak hour power deficit thereby,less demand of products as power supply is imperative for any consumer electronics products.

e) Air conditioner is a seasonal product therefore delayed/ short duration summer affects the overall business performance.

f) Indian economy growth is under threat due to fast pace inflation. Input costs of raw material especially of Aluminum, Copper and Sheet Metal has gone up and has led to reduction of margins.

INTERNATIONAL OUTLOOK ON OPPORTUNITIES, THREATS & CONCERN

The World Rail Market Study of 2016 depicts Western Europe and Asia Pacific as the largest rail supply markets accounting together for 58% of the total world market in future. With a growth of 2.6%, the Asian Pacific Region remain the largest total market for rail supply through to 2021 when Western Europe (the second largest market for rail supply) is expected to grow at 3.1% between 2019 and 2021. LEEL Group with its design & development and industrial sites established in Germany (Noske Kaeser Rail & Vehicle Germany GmbH), in the Czech Republic (Janka Engineering), in India (LEEL Electricals Limited) and in New Zealand (Noske Kaeser Rail & Vehicles New Zealand Ltd.) shall take advantage from the rail market in the respective areas. The significant increase in annual market demand is a sign of the rail sector’s robustness.

Opportunities

* Growing Rail market in

Europe.

New projects in Energy

and Industry segments.

Positive market trend in

Central EU

Market potential in

Germany and Italy.

Regulatory requirements

for HVAC equipment

pushing up demand.

*

*

*

*

* Political situation in EU

can negatively impact

economic development.

Increasing lack of

qualified personnel in

the market.

Growing competition,

both domestic and

international.

*

*

* The Company with its

subsidiaries is a very

small size player in

foreign market with

limited human and

financial resources

generating high risk in

operation.

Threats Concern


53

RISK

Risks which could impact the Company relate to exchange rates, interest rates, credit risks and volatile commodity prices risks as well as operating risks, arising out of high input costs, especially in the case of fixed price contracts and changes in technology which impact the Company’s product offerings. In addition, a general slowdown in the global and local economy tends to aggravate risks faced by the Company. All such risks are periodically identified and assessed in terms of the Company’s risk management framework and appropriate action is undertaken to minimize and mitigate the impact. Risks and the effectiveness of the risk management process are also periodically reviewed by the senior management and the Board. For detailed Financial Risk Management Objectives and Policies please refer notes to accounts of Financial Statements.

INTERNAL CONTROL SYSTEM AND ITS ADEQUACY

The Company has effective and adequate internal audit and control systems, commensurate with the business size to safeguard assets and protect against loss from any un-authorized use or disposition. Regular internal audit visits to the operations are undertaken to ensure that high standards of internal controls are maintained at each level of the organization. The Company’s internal controls are supplemented by an extensive programme of internal audits, review by management and documented policies, guidelines and procedures.

ENVIRONMENT, HEALTH & SAFETY

The Company is committed to promoting a safe and healthful environment for its employees and community. Through education, auditing and monitoring, technical consultation, and the provision of direct services, the Company mitigates the organizational risks and meeting its responsibilities for health, safety and environmental requirements. To improve the consistency of the organization’s approach towards environment safety controls, the Company implemented ISO 9001 and OHSAS 18001 and introduced a series of global standards, principles and practices that each operation should adopt. ISO 9001 focuses on managing organization’s impact on the external environment, to reduce pollution and comply with regulations and OHSAS 18001 focuses on managing your organization’s internal environment to ensure a safe and healthy workplace.

Audits were conducted against these standards and improvements are ongoing. Improving safety performance continues to be a priority for the Company. Improvements have been made in the methods of internal communication, knowledge sharing and reporting on safety matters. The HR team conducts EHS programs to educate employees about safety programs, make them aware of the Company’s health and safety policy and conduct formal safety trainings for all workers to prevent accidents, report unsafe conditions and protect the environment.

HUMAN RESOURCE

The Company strongly believes that Human Resource is the most important assets of an organization. In line with this belief:

Our philosophy and Goals:

• To create a friendly, dynamic work environment under a team concept while maintaining professionalism.

• To recruit and retain best people, develop their skills, cultivate new leaders & capitalise on their collective intelligence by applying human insights to transform the organization.

• Provide an enjoyable and rewarding environment for all individuals to learn, grow and develop to their fullest potential.

• To develop all professionals to their fullest potential through the following:

i. Progressive Experience and Responsibilities Based on Ability

ii. Performance Review Process

• Encourage our staff to be involved in and contribute to the community and to professional activities and organizations.

• Provide a competitive environment, products and services to attract and retain a diverse, high calibre staff.

• Support leadership efforts with a strategic workforce plan that creates a climate of innovation and excellence

• Create strategic processes that support organisational goals with innovation

The Company has put in place several initiatives that focus on leadership and talent development across grades. The Company has successfully implemented the “Business Excellence Program” through skill improvement initiatives ‘Kaizens- Improvements’ in the organization and has achieved positive results at almost all the levels of the organization.



We have built a robust leadership bench not only at the senior management level but also for all critical positions up to the middle management level and frontline roles in sales, service & operations. The Company continues to strive at providing employees with a rewarding, productive and successful association. The Company’s HR strategies are aimed at finding a balance between employees’ goals and aspirations with those of the Company. With a view to equip the Company to address the business challenges of a dynamic economic environment, the HR function focused on retaining and attracting suitable talent, enhancing the technical / behavioral skills of employees and optimizing employee costs.

The Company does not engage in any form of child labour/forced labour/involuntary labour and does not adopt any discriminatory employment practices. The Company has implemented OHSAS 18001 which focuses on managing organization’s internal environment to ensure a safe and healthy workplace. The Company has a policy against sexual harassment and a formal process for dealing with complaints of harassment or discrimination. The said policy is in line with Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 and Rules made thereunder. The Company, through the policy ensures that all such complaints are resolved within defined timelines. During the year, no case was reported.

The total permanent staff strength of the Company as on March 31, 2017 was 1,654.

Disclosures with respect to the remuneration of Directors and employees as required under Section 197 of the Act and Rule 5 (1) Companies(Appointment and Remuneration of Managerial Personnel) Rules, 2014 (Rules) have been appended as Annexure to the Board’s report. Details of employee remuneration as required under provisions of Section 197 of the Companies Act, 2013 and Rule 5(2) and 5(3) of the Rules are available at the Corporate Office of the Company during working hours, 21 days before the Annual General Meeting and shall be made available to any shareholder on request.

CAUTIONARY STATEMENT

“Statements in the “Management Discussion and Analysis” describing the Company’s objectives, projections, estimates and expectations or predictions may be ’forward looking statement’ within the meaning of applicable securities laws and regulations. Actual results could differ substantially and materially from those expressed or implied. Important factors that could make a difference to the Company’s operations include economic conditions effecting demand/supply and price conditions in the domestic and price conditions in the domestic and overseas markets in which the company operates, changes in the government regulations, tax laws and other statutes and other incidental factors.”


55

REPORT ON CORPORATE GOVERNANCEIn common parlance, Corporate Governance is the system of rules, practices and processes by which an organization is managed, directed and controlled to enhance the wealth generating- capacity. It provides an infrastructure essentially involved in balancing the interest of various stakeholders of the Company comprising regulators, investors, employees, vendors, management and the Community at large.

The Board of Directors (“The Board”) of your Company is committed to ensure that highest standards of Corporate Governance are practiced throughout the organization as well as in subsidiaries (the Group), as a fundamental part of group’s responsibilities to protect and enhance shareholders’ value and the financial performance of the Group.

In order to maintain the highest standards of Corporate Governance, your Company has devised code of conduct for its management including Directors, Key Managerial Personnel and Senior Management, Code of Conduct for Prevention of Insider Trading, Familiarization Programme of Independent Directors in accordance with the listing regulations and the Companies Act, 2013. These codes are available on the website of the Company www.leelelectric.com.

In pursuance of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as the “Listing Regulations”) and according to some of the best practices followed internationally on Corporate Governance, the following report on governance lays down the ethos of LEEL Electricals Limited (hereinafter referred as ‘LEEL’)and its commitment to conduct business in accordance with sound Corporate Governance practices.

I. COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCE

At LEEL, Corporate Governance practices aims to attain the Company’s objectives; it encompasses practically every sphere of the organization. The Board of Directors of the Company exercise their fiduciary duties towards all the stakeholders by embedding the principles of independence, integrity, accountability and transparency into the value system and the decision making process driving the Company.

Hence, they are based on the following broad principles:

Our corporate governance framework ensures effective engagement with our stakeholders and helps us evolve with changing times;

We believe that an active, well-informed and independent board is necessary to ensure the highest standards of corporate governance. At LEEL, the Board of Directors is at the core of our corporate governance practice and oversees how the Management serves and protects the long-term interests of our stakeholders;

Adopt transparent procedures and practices and arrives at decisions based on adequate information;

Ensures compliance with regulatory and fiduciary requirements in true letter and spirit;

Offers highest level of disclosures to disseminate corporate, financial and operational information to all stakeholders;

Creates various committees for audit, senior management compensation, HR policy and management compensation and Investor grievances.

Ensures complete and timely disclosure of relevant financial and operational information to enable the Board to play an effective role in the guiding strategy.

Keeps in place a well-defined corporate structure that establishes checks and balances and delegates decision making to appropriate levels in the organization though the Board remains in effective control of affairs at all times.

II. BOARD OF DIRECTORS

The Board of Directors of your Company regularly reviews the Company’s strategic business plans, the assessment of key risks by management and the operational and financial performance of the Company to enable the Company to meet its objectives and has the overall responsibility to maintain the highest standards of Corporate Governance throughout the organization.

The Board comprises of an optimum combination of Executive & Non-Executive Independent Directors including Women Directors, the Chairman is Executive Promoter Director. During the Financial Year under review, the Board comprised of ten Directors, out of ten Directors, five directors (50%) were Non-Executive Independent Directors.



1. Your Company has a broad-based Board of Directors, comprises eminent persons with considerable professional experience and expertise in diverse fields and constituted in compliance with the Companies Act, 2013, Listing Regulations and in accordance with good corporate governance practices.

2. For changes in compositions of directors of the Company please refer Directors and Key Managerial Personnel section under Board’s Report.

3. None of the Directors on the Board are Members of more than ten committees or chairman of more than five committees across all the companies in which they are Directors. Necessary disclosures under Regulation 26(2) of the Listing Regulations regarding the directorship and committee positions in other public companies as on March 31, 2017 have been made by the Directors.

4. Independent directors are non-executive directors as defined under Regulation 16 (1) (b) of the Listing Regulations. The independent directors are all experienced individuals from a range of industries and geographies. Their mix of professional skills and experience is an important element in the proper functioning of the Board and in ensuring a high standard of objective debate and overall input to the decision-making process. The Board has received from each independent director a written confirmation of their independence confirming that they meet the criteria of independence as mentioned under Regulation 16 (1) (b) of the Listing Regulations read with Section 149 of the Companies Act, 2013.

The terms and conditions of appointment of the Independent Directors are disclosed on the website of the Company at the link http://www.leelelectric.com/corporate-governance.html

5. There is no inter-se relationship between the Directors except Mr. Bharat Raj Punj, Deputy Managing Director who is son of Mr. Brij Raj Punj, Chairman & Managing Director of the Company.

6. During the Financial Year under review none of the Non-Executive Directors has held Shares and Convertible instruments in the Company and had any material pecuniary relationship or transactions with the Company.

7. The details of familiarization programme of the Independent Directors is available on the website of the Company at the link: http://www.leelelectric.com/corporate-governance.html

During the financial year under review, five (5) meetings of the Board of Directors were held on May 30, 2016, August 31, 2016, November 23, 2016, February 9, 2017 and February 18, 2017. The necessary quorum was present at all the meetings. The intervening period between two Board Meetings was well within the maximum time gap of 120 days, as prescribed under the Companies Act, 2013.

8. During the financial year 2016-17, information as mentioned in Part A of Schedule II of the Listing Regulations has been placed before the Board for its consideration.

9. Composition, Category and Attendance of Directors at Board Meetings, Last Annual General Meeting and number of other Directorships and chairmanships/memberships in Committees of each director in various companies as on March 31, 2017 are as follows:

S. No.

Name of the Directors Category of Directorship No. of Board

Meetings attended$

Last AGM

attended

No. of Direc-torship in

other Public Companies#

No. of Committees Positions held in other Public

Companies@

Chairman Member

1. Mr. Brij Raj PunjDIN: 00080956

Chairman and Managing Director Promoter

5 Yes 2 - -

2. Mr. Bharat Raj PunjDIN: 01432035

Deputy Managing DirectorPromoter

2 Yes 1 - -

3. Mr. Achin Kumar RoyDIN: 01475456

Whole Time Director 5 Yes - - -

4. Mr. Mukat B. SharmaDIN: 02942036

Whole Time Director 5 Yes - - -

Contd...


57

5. Mr. Nipun Singhal*DIN: 02026825

Whole Time Director 5 - - - -

6. A.V.M. Surjit Krishan Sharma (Retd.)DIN: 00058581

Non-Executive Independent Director

5 Yes - - -

7. Dr. Geeta Ajit TekchandDIN 02937277


5 - - - -

8. Mr. Ramesh Kumar Vasudeva DIN: 06368045


5 - - - -

9. Mr. Ajay DograDIN: 02430117


5 - - - -

10. Ms. Deepti Sahai^DIN: 07529738


5 - - - -

Notes: # Other directorships do not include directorships in private companies, foreign companies, companies under section 8 of the Companies

Act, 2013. @ Includes only Audit Committee and Shareholders’/Investors’ Grievance Committee of Public Limited Companies. * Mr. NipunSinghal, resigned from the directorship of the Company w.e.f. May 8, 2017. ^ Ms. Deepti Sahai was appointed as Non-Executive Independent Director (Additional) of the Company w.e.f. May 30, 2016. Her

appointment was approved by the Shareholders of the Company in the 29th Annual General Meeting held on August 26, 2016.

$ Video Conferencing facilities are also used to facilitate Directors to participate in the meetings.

III. AUDIT COMMITTEE

Audit Committee of the Company has been established with an aim of enhancing confidence in the integrity of your Company’s processes and procedures relating to internal control systems including financial reporting. The Company has a multi-disciplinary Audit Committee which is responsible for effective supervision of the financial reporting process, ensuring financial, accounting and operating controls and compliance with established policies and procedures including overseeing all the transactions that have monetary implications on the functioning of the Company. Audit Committee provides an ‘Independent’ reassurance to the Board through its oversight and monitoring role. The nomenclature, constitution and terms of reference of the Audit Committee are in accordance with the requirements mandated under Section 177 of the Companies Act, 2013 and Regulation 18 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The terms of reference of the Audit Committee are broadly as under:

• To oversee the Company’s financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible;

• To recommend the appointment, remuneration and terms of appointment of auditors of the Company;

• To review with the management, the annual financial statements and auditors’ report thereon before submission to the 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) significant adjustments made in the financial statements arising out of audit findings;

e) compliance with listing and other legal requirements relating to financial statements;

f) disclosure of related party transactions; and

g) modified opinion(s) in the draft audit report, if any



• To review with the management, the quarterly financial statements before submission to the Board for approval;

• valuation of undertakings or assets of the Company, wherever it is necessary;

• To approve related party transactions of the Company;

• To scrutinize the inter-corporate loans and investments;

• To review with the management, performance of statutory and internal auditors, adequacy of the internal control systems;

• To review the functioning of the Whistle Blower Mechanism;

• To approve the appointment of CFO after assessing the qualifications, experience and background, etc. of the candidate.

Pursuant to Section 177 of the Companies Act, 2013 and the listing regulations, the Company has established the vigil mechanism called “Whistle Blower Policy” for employees to report to the management instances of unethical behavior, actual or suspected fraud or violations of the Company’s code of conduct or ethics policy, the policy has been formulated with a view to provide a mechanism for the employees of the Company to approach the Whistle Counselor or the Whistle Blower Committee and in exceptional cases, Chairman of the Audit Committee of the Company.

During the year under review Audit Committee comprised of 3 members, out of which 2 members were Independent Directors. Ms. Anita K. Sharma, Company Secretary & VP Finance acts as the secretary to the Committee. A.V.M. Surjit Krishan Sharma (Retd.), Chairman of the Audit Committee was present at the last Annual General Meeting which was held on August 26,2016.

During the year under review, five (5) meetings of the Audit Committee were held on May 30, 2016, August 31, 2016, November 23, 2016, February 9, 2017 and February 18, 2017. The adequate quorum was present at all the meetings.

As on March 31, 2017, the composition and attendance of the members at the meetings were as follows:

Name of Directors Designation Category of Director No. of Meetings Held

No. of Meetings Attended

A.V.M. Surjit Krishan Sharma (Retd.) Chairman Non- Executive Independent Director. 5 5

Dr. Geeta Ajit Tekchand Member Non- Executive Independent Director. 5 5

Mr. Mukat B. Sharma Member Whole Time Director & CFO 5 5

IV. NOMINATION & REMUNERATION COMMITTEE

In pursuance of the provisions of section 178 of the Companies Act, 2013, Regulation 19 of the Listing Regulations, the Company has in place a Nomination and Remuneration Committee (‘NRC’) comprising of Independent Directors viz. A.V.M. Surjit Krishan Sharma (Retd.), Dr. Geeta Ajit Tekchand and Mr. Ajay Dogra.

A.V.M. Surjit Krishan Sharma (Retd.) is the Chairman of the Committee. Ms. Anita K. Sharma, Company Secretary & VP Finance is acting as the Secretary to the Committee. The Chairman of the NRC was present in the last Annual General Meeting of the Company held on August 26, 2016.

NRC recommends the appointment of diversified Board members and also recommends the terms of appointment including remuneration of the Executive Directors of the Company, further it reviews and recommends the payment of annual salaries, commission and finalizes service agreements and other employment conditions of the Executive Directors. The guiding principle of the Committee is that the remuneration and the other terms of employment for the Executives shall be Competitive in order to ensure that the Company can attract and retain competent Executives and the rewards shall commensurate with their contributions towards the growth of the Company.

The broad terms of reference of the Nomination and Remuneration Committee are as under:

• To formulate the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy relating to the remuneration of the Directors, Key Managerial Personnel and other Senior Management Employees;

• To formulate criteria for evaluation of Independent Directors and the Board;

• To devise a policy on Board diversity and to ensure that;


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The level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors to run the Company successfully;

Relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

Remuneration to Directors, Key Managerial Personnel and Senior Management involves a balance between fixed and incentive pay reflecting short and long term performance objectives appropriate to the working of the Company and its goal

• To identify persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, recommend to the Board their appointment and removal.

During the year under review, three (3) meetings of the NRC were held on May 30, 2016, November 23, 2016 and February 09, 2017.Adequate Quorum was present at all the meetings.

As on March 31, 2017, the Composition and Attendance of the members at the meetings were as follows:


No. of Meetings attended

A.V.M. Surjit Krishan Sharma (Retd.) Chairman Non- Executive Independent Director 3 3

Dr. Geeta Ajit Tekchand Member Non- Executive Independent Director 3 3

Mr. Ajay Dogra Member Non-Executive Independent Director 3 3

A. Remuneration Policy

The Nomination and Remuneration Committee recommends to the Board the compensation package of the Executive Directors and also the compensation payable to the Non- Executive Directors of the Company in accordance with the provisions contained in the Act. The Non-Executive Directors are paid sitting fees for attending the Meetings of the Board of Directors and Committees within the ceiling prescribed by the Central Government

The key components of the Company’s Remuneration Policy are:

1. Remuneration Policy for the Executive Team.

This Policy concerns the remuneration and other terms of employment for the Company’s Executive Team. The members of the Executive Team, including the Managing Director, Key Managerial Personnel, Whole Time Directors and Executive Directors are hereinafter referred to as the “Executives”. The broad terms governing their remuneration are:

• Guiding principles for remuneration and other terms of employment: The guiding principle is that the remuneration and the other terms of employment for the Executives shall be Competitive in order to ensure that the Company can attract and retain competent Executives.

• The principles for fixed salaries and variable salary: The NRC shall recommend the remuneration structure of the Executives based on various factors such as industry benchmarks, the Company’s performance, experience and expertise of the Executive, responsibilities shouldered by him, his contributions in bringing strategic upsurges and other economic factors appropriate to the working of the Company and its long term goals. The remuneration may be paid as salary, perquisites, allowances, incentives and commission (Fixed or Variable Component) within the overall ceiling approved by the Shareholders of the Company.

• Annual Enhancement of Remuneration: The annual enhancement in remuneration of the executives shall be within the salary scale approved by the Shareholders of the Company.

2. Remuneration Policy for the Non- Executive and Independent Directors

• During the financial year under, the Non-Executive and Independent Directors were paid sitting fees of Rs.15,000 for attending each meeting of the Board. The Board of Directors had after reviewing and evaluating the performance of the Independent Directors in its Board Meeting held on May 30, 2017, have increased the sitting fees to be paid to them from Rs.15,000 to Rs.20,000 for attending each meeting of the Board. The sitting fees may be revised from time to time within the overall limits specified by the Companies Act, 2013.



• The Company shall reimburse out-of-pocket expenses to Directors for attending the meeting held at a City other than the one in which the Director resides.

The Non-Executive Independent Directors have not drawn any remuneration from the Company, except the sitting fees for attending the meetings of the Board.

Details of Remuneration paid to Executive Directors during the Financial Year 2016-17: (` In Crores)

S. No. Name of the Directors Salary Perquisites and other benefits

Commission / Incentive

Provident Fund Total

1. Mr. Brij Raj Punj 0.52 0.26 - - 0.78

2. Mr. Bharat Raj Punj 0.39 0.19 - 0.05 0.63

3. Mr. Achin Kumar Roy 0.78 0.29 0.50 0.09 1.66

4. Mr. Mukat B. Sharma 0.30 0.15 - 0.04 0.49

5. Mr. Nipun Singhal* 0.46 0.13 0.41 0.05 1.05

1. No severance fee is payable on termination of contract.2. The Company does not have any Stock Options Scheme.3. The above excludes the provisions for gratuity and leave encashment, as the same is calculated on overall company basis.*Mr. Nipun Singhal resigned from the directorship of the Company w.e.f. May 8, 2017.

Details of Remuneration paid to Non- Executive Independent Directors during the Financial Year 2016-17: (In `)

S. No. Name of Directors Sitting fees paid during the FY 2016-17

1. A.V.M. Surjit Krishan Sharma (Retd.) 75,000

2. Dr. Geeta Ajit Tekchand 75,000

3. Mr. Ramesh Kumar Vasudeva 75,000

4. Mr. Ajay Dogra 75,000

5. Ms. Deepti Sahai 75,000

B. Evaluation Criteria

The Company has put in place the system for annual evaluation of Board as a whole, its committee and directors. The performance of the Board will be evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the Board composition and structure, board meetings and effectiveness of board processes, information and functioning, etc. The performance of the committees will be evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the compliance with the terms of reference of the committees, composition of committees, functions and duties, committee meetings & procedures, etc.

The Board and the NRC reviews the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings, attendance, independent judgment etc. In addition, the Chairman will also be evaluated on the basis of criteria such as leadership, managing relationship, conducting board meetings etc.

In a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman will be evaluated, taking into account the views of executive directors and non-executive directors.

V. STAKEHOLDERS RELATIONSHIP COMMITTEE

In pursuance of the Listing Regulations and provisions of Section 178 of the Companies Act, 2013, the Company has constituted Stakeholders Relationship Committee (SRC) to redress the shareholders’ and investors’ grievances.

The committee comprises four (4) members out of which three (3) are Non-Executive Independent Directors. The Committee deals with the matters related to redressal of shareholders and investor grievances, including but not limited:

• To consider and resolve the grievances and request of the shareholders and other security holders of the Company pertaining to transfer/transmission of shares, non-receipt of Annual Reports, non-receipt of dividend, dematerialization/ dematerialization of shares, issuance of duplicate share certificates, etc.


61

• To oversee performance of the Registrar and Share Transfer Agent of the Company including to review their appointment/ re-appointment and terms of reference,

• To periodically review the implementation and compliance of Company’s Code of Conduct for Prohibition of Insider Trading.

• To monitor the compliances with respect to the provisions of Companies Act, 2013 pertaining to shareholders and stakeholders, payment of dividend, Rules and Regulations prescribed by the Securities & Exchange Board of India(SEBI), BSE, National Stock Exchange of India Ltd. and other regulatory bodies, etc.

The Stakeholders Relationship Committee focuses primarily on strengthening investor relations and ensuring the rapid resolution of the shareholder or investor concerns. The Committee meets at least once in a fortnight to attend the formalities pertaining to transfer of securities, transmission, issue of duplicate shares etc. During the year ended March 31, 2017 the Committee met 33 times. The details of the meetings are as follows:

12.04.2016; 21.04.2016; 30.04.2016; 14.05.2016; 24.05.2016; 31.05.2016;

10.06.2016; 24.06.2016; 30.06.2016; 13.07.2016; 21.07.2016; 30.07.2016;

11.08.2016; 19.08.2016; 01.09.2016; 14.09.2016; 21.09.2016; 30.09.2016;

14.10.2016; 28.10.2016; 11.11.2016; 24.11.2016; 09.12.2016; 23.12.2016;

31.12.2016; 14.01.2017; 28.01.2017; 07.02.2017; 14.02.2017; 28.02.2017;

07.03.2017; 21.03.2017; 31.03.2017.

Adequate Quorum was present at all the meetings and the Chairman of the Committee was present in the last AGM held on August 26, 2016.

The composition of the SRC and the details of meetings attended by its members are given below:



A.V.M. Surjit Krishan Sharma (Retd.) Chairman Non- Executive Independent Director 33 33


Mr. Ramesh Kumar Vasudeva Member Non- Executive Independent Director 33 33

Mr. Achin Kumar Roy Member Whole Time Director 33 33

Ms. Anita K. Sharma, Company Secretary & VP Finance is the Compliance Officer and acts as the secretary to the Committee.

Details of investors Complaints\requests received & redressed during the year:

Opening Balance Received During the year Resolved During the year Closing Balance

3 20 22 1*

*The pending complaint has also been resolved on the date of this report.

VI. CORPORATE SOCIAL RESPONSIBILTY (CSR) COMMITTEE

CSR Committee of the Company has been constituted in line with the provisions of Section 135 of the Companies Act, 2013. The broad terms of reference CSR committee is as follows:

1. Formulate and recommend to the board, a CSR policy indicating the activities to be undertaken by the Company as specified in Schedule VII of the Act;

2. Recommend the amount of expenditure to be incurred on the activities referred to above;

3. Monitor the CSR Policy of the Company.



Two meetings of the CSR committee were held during the year on May 30, 2016 and November 23, 2016. The composition of the CSR Committee and details of the meeting attended by its members are given below:



Mr. Achin Kumar Roy Chairman Whole Time Director 2 2

Mr. Mukat B. Sharma Member Whole Time Director 2 2


VII. SUB-COMMITTEE OF THE BOARD OF DIRECTORS

To aid the smooth and efficient functioning for administration and management of day to day affairs of the Company a Sub-Committee of Board of Directors had been constituted and vested with the essential powers to perform various responsibilities. The Committee is authorized to transact all the businesses which the Board of Directors of the Company are empowered to transact except for the transactions that are mandated to be dealt in at the Board Meeting and have been specifically barred pursuant to the provisions of the Companies Act, 2013 from being delegated to the Committee. The Committee meets at regular intervals to decide upon matters of routine nature and the minutes of the Committee meetings held are placed before the Board for consideration and ratification in the succeeding Board Meeting.

During the year 16 meetings were held, the details of the meetings held during the year are as follows:

02.05.2016; 11.05.2016; 01.06.2016; 30.06.2016; 12.07.2016; 19.08.2016;

15.10.2016; 02.12.2016; 08.12.2016; 20.12.2016; 12.01.2017; 23.01.2017;

03.02.2017; 14.02.2017; 21.03.2017; 30.03.2017.

The composition of sub-committee of the Board of Directors and details of the meeting attended by its members are given below:



Mr. Brij Raj Punj Chairman Chairman and Managing Director 16 13

A.V.M. Surjit Krishan Sharma (Retd.) Member Non- Executive Independent Director 16 16


The proceedings of the committee are placed before the Board of Directors in their meeting for noting and ratification.

Ms. Anita K. Sharma, Company Secretary & VP Finance acts as the Secretary to the committee.

On May 30, 2017, the sub-commitee was re-constituted by inducting Mr. Mukat B. Sharma, Wholetime Director & CFO of the Company as member of the Committee.

VIII. SPECIAL COMMITTEE FOR ALLOTMENT OF SHARES

The Special Committee of the Board has been constituted for issue and allotment of shares and other securities issued time to time in pursuance of preferential allotments, private placements, right issues etc. to expedite the process of allotment and issue of shares.

The Committee comprises of following Directors during the financial year 2016-17:

1. A.V.M. Surjit Krishan Sharma (Retd.);

2. Dr. Geeta Ajit Tekchand and;

3. Mr. Nipun Singhal (has resigned from the directorship of the Company w.e.f. May 08, 2017)

Ms. Anita K. Sharma, Company Secretary & VP Finance acts as the Secretary to the committee.

There were two meetings held during the year on September 3, 2016 and September 8, 2016 and all members were present in the aforesaid meetings. The proceedings of the committee are placed before the Board in its meeting for confirmation.


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IX. GENERAL BODY MEETINGS

1. Annual General Meetings:

The last three Annual General Meetings were held as under:

Financial Year Date & Time Venue Details of Special Resolution passed thereat

2015-2016 August 26, 2016 at 9.30 A.M. Regd. Office: A – 146 (B & C), RIICO Industrial Area, Bhiwadi, Distt. Alwar, Rajasthan.

No special resolution passed.

2014-2015 July 10, 2015 at 9.30 A.M Regd. Office: A – 146 (B & C), RIICO Industrial Area, Bhiwadi, Distt. Alwar, Rajasthan.

No special resolution passed.

2013-2014 July 21, 2014 at 9.30 A.M Regd. Office: A – 146 (B & C), RIICO Industrial Area, Bhiwadi, Distt. Alwar, Rajasthan.

Re-appointment of Mr. Brij Raj Punj as Managing Director for a period of 5 years w.e.f. 31.10.2013 and payment of remuneration.

2. During the financial year under review, the Company has passed the following Special Resolutions by way of Postal Ballot:

I. Special Resolutions passed by way of Postal Ballot dated November 23, 2016 the result of which was declared on December 28, 2016:

a. Special Resolution for shifting of the Registered Office of the Company from the State of Rajasthan to the State of Uttar Pradesh:

Particulars Total no. of Postal ballots/ E-votes received

Total no. of votes contained

Total no. of invalid votes

Total no. of valid votes contained

Total no. of votes casted with assent for the Resolution

Total no. of votes casted with dissent for the Resolution

Physical 28 36,08,475 - 36,08,475 36,08,075 400

Electronic 161 2,05,70,779 - 2,05,70,779 2,05,70,254 525

Total 189 2,41,79,254 - 2,41,79,254 2,41,78,329 925

% of total votes casted in favour of the Resolution: 99.99%% of total votes casted against the Resolution: 0.01%

b. Special Resolution to increase the borrowing powers of the Board of Directors of the Company upto Rs.2,500 crores under Section 180(1)(c) of the Companies Act, 2013:







Physical 25 36,07,875 - 36,07,875 36,07,475 400

Electronic 163 2,05,70,947 - 2,05,70,947 2,04,14,330 1,56,617

Total 188 2,41,78,822 - 2,41,78,822 2,40,21,805 1,57,017


c. Special Resolution to authorize the Board of Directors of the Company for Creation of Charges/Mortgages on the Company’s properties both present and future, in respect of borrowings of an aggregate amount not exceeding Rs.2,500 Crores under Section 180(1)(a) of the Companies Act, 2013:







Physical 26 36,07,975 - 36,07,975 36,07,525 450

Electronic 160 2,05,71,048 - 2,05,71,048 2,04,24,110 1,46,938

Total 186 2,41,79,023 - 2,41,79,023 2,40,31,635 1,47,388




II. Special Resolutions passed by way of Postal Ballot dated February 19, 2017, the result of which was declared on March 24, 2017:

a. Special Resolution for sale of Consumer Durable Business of the Company to Havells India Limited by way of slump sale on a going concern basis:







Physical 11 3,547 - 3,547 3,547 -

Electronic 200 2,33,42,742 - 2,33,42,742 2,31,54,561 1,88,181

Total 211 2,33,46,289 - 2,33,46,289 2,31,58,108 1,88,181


b. Special Resolution for Ceasing of Usage of the Brand “LLOYD”and/or “Lloyd” and Change of Name of the Company:







Physical 11 3,547 - 3,547 3,547 -

Electronic 202 2,33,42,845 - 2,33,42,845 2,31,53,309 1,89,536

Total 213 2,33,46,392 - 2,33,46,392 2,31,56,856 1,89,536


3. Mr. Sanjay Chugh, Practicing Company Secretary was appointed as the Scrutinizer for carrying out the postal ballot processes for the both the postal ballots as aforesaid in a fair and transparent manner.

4. Whether any special resolution is proposed to be conducted through postal ballot: No

5. Procedure for Postal Ballot:

In compliance with Sections 108, 110 and other applicable provisions of the Companies Act, 2013 read with the Rules issued thereunder, the Company provides electronic voting (e-voting) facility to all its members. The Company engages the services of NSDL for the purpose of providing e-voting facility to all its members. The members have the option to vote either by physical ballot or through e-voting. The Company dispatches the postal ballot notices and forms along with postage prepaid business reply envelopes to its members whose names appear on the Register of Members / list of beneficiaries as on cut-off date. The postal ballot notice is sent to members in electronic form to the email addresses registered with the depository participants / Company’s Registrar & Share Transfer Agents. The Company also publishes a notice in the newspapers declaring the details of completion of dispatch and other requirements under the Companies Act, 2013 and the Rules issued thereunder.

Voting rights are reckoned on the paid up value of shares of your Company in the names of the shareholders as on the cut – off date. Members desiring to vote through physical ballot are requested to return the forms, duly completed and signed to as to reach the Scrutinizer before the close of the voting period. Members desiring to exercise their votes by electronic mode are requested to vote before the close of business hours on the last date of e-voting.

The Scrutinizer submits his report to the Chairman, after the completion of scrutiny and the consolidated results of the voting by postal ballot are then announced by the Chairman / authorized officials of the Company. The results are displayed on the website of the Company www.leelelectric.com, besides being communicated to the Stock Exchanges, NSDL and Registrar &Transfer Agent.

In accordance with the Secretarial Standard on General Meeting (SS-2) issued by ICSI, the resolutions as set out in the notice of Postal Ballots, if assented to by the requisite majority of the shareholders by means of postal ballot including voting by electronic means, will be taken as passed effectively on the last date specified by the Company for receipt of duly completed postal ballot forms or e-voting.


65

X. MEANS OF COMMUNICATION

The Company disseminates information to all the stakeholders through various channels:

Financial Results Quarterly & Annual Results are published in daily newspapers viz.The Pioneer (Delhi), Adhikar (Jaipur). After the shifting of registered office of the Company from Rajasthanto the State of Uttar Pradesh the Company publishes the results in Financial Express(All editions) and Jansatta (UP). The results are sent to stock exchanges as well as posted on the Company’s website: www.leelelectric.com

News Releases Official news releases are sent to stock exchanges as well as displayed on the Company’s website: www.leelelectric.com

Website The Company’s corporate website is www.leelelectric.comwhich provides comprehensive information about the Company. The Annual Report of the Company is available on the website. The same is also sent to all the Stock Exchanges where the shares of the Company are listed, for uploading on their own website.

Annual Report Annual Report is circulated to all the members and all others entitled thereto like auditors, equity analyst etc.

Presentations to Institutional Investors/ analysts. YesWhether Management Discussion & Analysis report is a part of Annual Report or Not.

Yes

Whether Shareholder Information Section forms part of the Annual Report

YesDetails in case of appointment / re-appointment of directors have been provided in the Notice convening AGM.

XI. GENERAL SHAREHOLDERS INFORMATION

1. Registered Office : Unit No. 8, Block B, Old District Courts, Complex, Industrial Area, Phase II, Noida, Uttar Pradesh, 201305.

2. Corporate Office : 159, Okhla Industrial Estste, Phase III, New Delhi 110020.3. Annual General Meeting

DateTimeVenue

:::

September 26, 201709:30 AMRama Ceremonial, Main Market, Sector-110Kendriya Vihar II, Noida-201301 (U.P.)

4. Financial Year : The financial year of the Company covers the fiscal period from April 01 to March 31 every year.

5. Date of Book Closure/ Record date : September 20, 2017 to September 26, 20176. Dividend Payment : The final dividend of Rs.1.50 per share, if declared, shall be paid / credited

soon after the declaration of the dividend in the AGM. Dividend warrant shall be dispatched on or after October 03, 2017 to members who hold shares in physical form.

7. Listing of Equity Shares / Shares underlying GDR’s on Stock Exchanges

: The equity shares of the company are listed at BSE Ltd. (BSE) and National Stock Exchange of India Ltd. (NSE). The GDR’S are listed on London Stock Exchange.Annual Listing fees to the Stock Exchanges for the Financial Year 2017-18, as applicable, have been paid well before the due date.

8. Custodial Fees to Depositories. : Annual Custody / Issuer fee for the financial year 2017-18 has been paid within the due date.

9. Stock Code/ SymbolCorporate Identification No (CIN)Equity SharesBSENSEISIN

: L29120UP1987PLC0191016

517518LEELINE245C01019

10. GDR’sLondon Stock ExchangeOverseas Depository (For GDR’s)Domestic Custodian (For GDR’s)

:::

LLDThe Bank of New YorkICICI Bank Limited



11. Unclaimed/Unpaid Dividend:

The Company has transferred the unpaid or unclaimed dividends declared up to financial years 2007-08, from time to time, to the Investor Education and Protection Fund (IEPF) established by the Central Government. Hence, no claim shall lie in respect of the same. The Company has uploaded the details of unpaid and unclaimed dividend amounts lying with the Company as on August 26, 2016 (date of the 29th Annual General Meeting) alongwith unpaid and unclaimed final dividend declared on 29th AGM on the website of the Company and the same can be accessed through the link: http://www.leelelectric.com/unpaid-unclaimed-dividend.html.

The dividend for the following years remaining unclaimed for seven years will be transferred by the Company to IEPF according to the schedule given below. Shareholders who have not so far encashed their dividend warrant(s) or have not received the same are requested to seek issue of duplicate warrant(s) to the company confirming non-encashment/ non receipt of dividend warrant(s). Once the unclaimed dividend is transferred to IEPF, no claim shall lie with the Company in respect of the same.

Financial Year Date of declaration Due date for transfer to IEPF

2009-2010 (Final) September 28, 2010 November 03, 2017


2011-2012 (Final) September 8, 2012 October 14, 2019


2013-2014 (Final) July 21, 2014 August 26, 2021

2014-2015 (Final) July 10, 2015 August 8, 2022

2015-2016 (Final) August 26, 2016 September 30, 2023

Special Dividend 2017(Interim Dividend)

May 30, 2017 July 4, 2024

Attention of the members is drawn that during the year under review, the Ministry of Corporate Affairs notified provisions relating to unpaid / unclaimed dividends under Sections 124 and 125 of Companies Act, 2013 (‘Act’) and Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules. As per the new rules, the Company is required to transfer all the Shares in respect of which dividend has not been claimed by the shareholders for last seven consecutive years in the Demat Account of the IEPF Authority.

In accordance with the aforesaid provision of the Act, the Company has already sent notices to all shareholders who have not claimed dividend for last 7 consecutive years from the financial year 2009-10 and whose shares are due to be transferred to the IEPF Authority and published requisite advertisement in the newspapers. The full details of such shareholders and shares due for transfer are also uploaded in the website of the Company http://www.leelelectric.com/unpaid-unclaimed-dividend.html

Shareholders are requested to check the same and claim the unpaid dividend before the due date of transfer of dividend in order to avoid the compulsory transfer of dividend alongwith shares to IEPF Authority. Shareholders may note that both the unclaimed dividend and the shares transferred to IEPF Authority can be claimed back by them from IEPF Authority after following the procedure prescribed by the IEPF Rules.

12. Share Transfer System

The Board has constituted the Stakeholders Relationship Committee and delegated the power of share transfer to the Committee. The Committee holds meetings its atleast once in a fortnight to consider all the matters concerning transfer and transmission of shares.

As on March 31, 2017, 99.05% of the Equity Shares of the Company are in electronic form. Transfer of physical shares in to electronic shares is done through the depositories with no involvement of the Company. As regards transfer of shares held in physical form, the transfer documents can be lodged with Skyline Financial Services Pvt. Limited (Registrar & Transfer Agent) of the Company. Transfer of shares in physical form is normally processed within ten to twelve days from the date of receipt, if the documents are complete in all respects.


67

13. Reconciliation of Share Capital Audit

A Practicing Company Secretary carries out reconciliation audit of the share capital in each quarter to reconcile the total admitted capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Ltd. (CDSL) and total issued and listed capital. The audit reports confirm that the total issued/paid up capital is in agreement with the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL. The reconciliation of share capital audit reports for each quarter of the Financial Year ended March 31, 2017 have been filed with the Stock Exchanges within one month of the end of each quarter.

14. Financial Calendar for the financial year 2017-18 (Provisional):

Declaration of Results for the Quarter ended on Tentative Date

Financial Reporting for the quarter ending June 30, 2017 Declared on August 10, 2017

Financial Reporting for the quarter ending September 30, 2017 On or before November 14, 2017

Financial Reporting for the quarter ending December 31, 2017 On or before February 14, 2018

Financial Reporting for the quarter and year ending March 31, 2018 On or before May 30, 2018

Annual General Meeting for the year ended March 31, 2018 Before the end of September, 2018

15. Market Price Data

Particulars BSE NSE

Months for the Financial Year 2016-2017

High (Rs./share)

Low (Rs./share)

High (Rs/share)

Low (Rs./share)

April’ 16 284.80 245.40 284.80 244.85

May’ 16 278.30 242.90 254.80 242.40

June’ 16 258.65 207.80 259.80 220.10

July’ 16 255.00 228.00 255.00 228.10

August’ 16 270.70 228.00 270.65 227.50

September’ 16 301.00 242.00 301.40 242.75

October’ 16 340.00 265.00 336.60 264.90

November’ 16 339.20 233.40 339.00 234.10

December’ 16 285.00 240.50 284.75 240.15

January’ 17 293.00 251.75 291.65 251.05

February’ 17 340.40 260.00 340.35 260.10

March’ 17 264.75 235.50 264.85 235.80

16. Performance of the Company in comparison to BSE Sensex during the financial Year 2016-17:

30000

29000

28000

27000

26000

25000

24000

23000

350

300

250

200

150

100

50

0

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6

Ma

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16

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16

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6

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16

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16

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17

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17

BSE Sensex

LEEL Electricals Ltd.Scrip Closing Price



17. Distribution of Shareholding as on 31st March, 2017.

No. of Share held of Rs.10 each No. of Shareholders %age of Total No. of Shares %age of TotalUp to 500 31,578 89.12 3,747,283 9.29501 – 1000 1,937 5.47 1,567,448 3.89

1001 – 2000 929 2.62 1,424,159 3.53 2001 – 3000 315 0.89 821,291 2.04 3001 – 4000 148 0.42 534,187 1.32 4001 – 5000 122 0.34 567,492 1.41 5001 – 10000 199 0.56 1,457,453 3.61 10001 - & above 206 0.58 30,212,947 74.91 Total 35,434 100 4,03,32,260 100

9.29%

3.89%

Up to 500

501-1000

1001-2000

2001-3000

3001-4000

4001-5000

5001-10000

10001- & above

74.91%

3.53%

2.04%1.32%1.41%3.61%

Distribution of Shareholding

18. Shareholding Pattern as at 31st March, 2017.

Category No. of Shares held % of shareholdingPromoters 2,26,64,396 56.19%Foreign Institutional Investors 7,13,081 1.77%

Private Corporate Bodies 40,50,936 10.04%NRI/OCB’s 9,39,131 2.33%Shares underlying GDRs 16,000 0.04%Indian Public & Others 1,19,48,716 29.63%Total 4,03,32,260 100%

2%

10%

2%

0%

Promoters

Foreign Institutional Investors

Private Corporate Bodies

NRI/OCB’s

Shares underlying GDRs

Indian Public & Others

Shareholding Pattern as at 31st March, 2017

30%

56%


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19. Dematerialization of Shares and Liquidity

The Company’s shares are compulsorily traded in dematerialized form and are available for trading on both the depositories in India viz. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). As on March 31, 2017, 3,99,63,182 equity shares of the Company, forming 99.05% of the shareholding stand dematerialized.

The Shares of the Company are regularly traded at the National Stock Exchange of India Ltd. and BSE Ltd.

20. Outstanding GDR’s/ ADR’s/ Warrants or any Convertible Instruments, Conversion date and Likely impact on equity.

GDRs: The outstanding GDRs are backed by underlying equity shares which are part of the existing paid-up capital of the company. 8,000 GDRs underlying 16,000 equity shares of the company are outstanding as on March 31, 2017. Each GDR represents two underlying equity shares.

Warrants: During the year 2014-15, the Company had issued to its Promoter Group Entities 60 Lac warrants at a price of Rs.152 each entitling them for subscription of equivalent number of Equity Shares of Rs.10 each (including premium of Rs.142 each share) in accordance with chapter VII of SEBI (issue of Capital & Disclosure Requirements) Regulations, 2009.

During the previous year, allottees of 8.85 Lac warrants have exercised their right to convert the warrants into equity shares by paying balance 75% of the consideration and consequently 8.85 Lac equity shares were issued to them.

During the financial year, the Company has issued and allotted 17 Lac equity shares of Rs.10 each at a premium of Rs.142 each on September 03, 2016 and 24.27 Lac equity shares of Rs.10 each at a premium of Rs.142 each on September 08, 2016 to promoter group entities on preferential basis upon conversion of equivalent no. of warrants.

Consequent to the aforesaid allotment made during the financial year under review, the Paid-up Equity Share Capital of the Company has increased to Rs.40,33,22,600 divided into 4,03,32,260 Equity Shares of face value Rs.10 each and promoters shareholding has increased from 51.20% to 56.19% of the total paid up capital.

Further, the promoter group entities have shown their inability to exercise their right to convert the balance 9.88 lacs warrants which are required to be converted into equity shares on or before September 12, 2016 as conversion of such number of warrants would have increased their shareholding beyond the permissible creeping limit of 5% in a financial year as stipulated in Regulation 3(2) of the SEBI (Substantial Acquisition of Shares & Takeovers) Regulations, 2011. Accordingly, 9.88 lacs warrants stand cancelled and the upfront subscription money aggregating to Rs.3.75 Crores received on said warrants at the time of their subscription was forfeited. Consequent upon the above allotments and forfeiture of warrants, there were no pending warrants due for conversion as on March 31, 2017.

21. Green initiative in Corporate Governance

As a continuing endeavor towards the ‘Go Green’ initiative, the Company proposes to send future correspondence and documents like the notice calling the general meeting, audited financial statements, Board’s report, auditors’ report etc. in electronic form, to the email address provided by the Members and made available to us by the Depositories.

Members who hold shares in physical form are requested to register their e-mail addresses and intimate any change in e-mail id, with the Company or with the Registrars & Share Transfer Agents, SKYLINE FINANCIAL SERVICES PRIVATE LIMITED. In respect of electronic holdings members are requested to register their e-mail addresses with the Depository through their concerned Depository Participants. However, in case you desire to receive Company communication and documents in physical form, you are requested to intimate us through e-mail at [email protected] You may kindly note that as a Member of the Company, you will be entitled to be furnished, free of cost, a printed copy of the Annual Report of the Company, upon receipt of a requisition from you, at any time.

Members are advised to convert their shares from Physical mode to Dematerialized mode. Dematerialization of shares provides several benefits to the shareholders. The transaction of shares can be carried out quickly and in an easy way. Holding securities in Demat form helps the investors to get immediate transfer of securities. No stamp duty is payable on transfer of shares held in Demat form and the brokerage involved is also lowest. The incidence of non-delivery or bad delivery and the risks associated such as forged transfers that occurs for the shares when held in physical format is totally avoided. Shareholders are not required to hold saleable set of shares for trading



22. Plant Locations

Domestic Manufacturing Locations;

a) A – 146, (B & C), RIICO Industrial Area, Bhiwadi, Distt. Alwar, Rajashtan

d) Plot No. S 21 & S 22, Non SEZ, Phase III, Sipcot Road, Mugundarayapuram, Ranipet, Vellore District (Tamilnadu)

b) Industrial Area, Kala-Amb, Trilokpur Road, Sirmour, Nahan, Himachal Pradesh

e) Village Nizampur, Taura, - Rewari Road,Tehsil- Tauru, Distt.- Mewat

c) Plot No. 24, Sector 2, IIE, SIDCUL, Pantnagar, Haryana-122 105

f) Khasra No. 1511-1512, Village SalempurMehdood, Industrial Park-II, SIDCUL, Bahadrabad Bypass Road, Distt. Haridwar, Uttarakhand- 249 402

Overseas Manufacturing Locations:

a) Lloyd Coils Europe s.r.oPrague-5, RadotinVrazaska 143Postal Code 153000

b) Janka Engineering s.r.oVrazsja 14315300 PrahaRadotinCzech Republic

c) Noske-Kaeser Rail & Vehicle New Zealand Limited20, Noel Rodgers Place,Milsone, Palmerston North,44114 New Zealand.

Address for Correspondence and for grievance redressal:

Corporate Office Registrar & Share Transfer Agent Investor Relation Department Skyline Financial Services Private LIMITED LEEL Electricals Limited D-153 A, First Floor, 159, Okhla Industrial Estate, Okhla Industrial Area, Phase-I Phase-III, New Delhi-110020 New Delhi- 110020 Tel No. 91-11-40627200, 40627300 Tel : 91-11-26812682, 26812683, 84 Fax: 91-11-41609909 Fax : 91-11-26292681 E mail id: [email protected] E mail id: [email protected] Website: www.leelelectric.com Website: www.skylinerta.com

COMPLIANCE OFFICER Anita K. Sharma Company Secretary & VP Finance FCS No: F7373

XII. OTHER DISCLOSURES

1. Code of Conduct

The Company has adopted a Code of Conduct for all Board Members and Senior Management Personnel of the Company. The Code of Conduct has been posted on the website of the Company for general viewing at http://leelelectric.com/pdf/Code-of-Conduct-LEEL.pdf

All Board Members and Senior Management Personnel have affirmed compliance with the Code of Conduct. The Annual Report contains a declaration to this effect signed by the Chairman & Managing Director.

2. Related Party Transactions

During the year under review, besides the transactions reported in Notes forming part of the financial statements for the year ended March 31, 2017, which are entered in ordinary course of business and on arm’s length basis, there were no other material related party transactions of the Company with its promoters, Directors or the management or their relatives and subsidiaries. These transactions do not have any potential conflict with the interest of the Company at large. These have been approved by the audit committee and Board of Directors of the Company. The board has approved a policy for related party transactions which has been uploaded on the Company’s website at the following link:

http://leelelectric.com/pdf/Material%20Related%20Party%20Policy.pdf


71

3. Disclosure of Accounting Treatment

Please refer Board’s Report for disclosure of Accounting Treatment.

4. Risk Management

The Risk Management of the Company is overseen by the Senior Management and the Board at various levels. The Company is actively engaged in assessing and monitoring the risks of each of the businesses and overall for the Company as a whole. The top tier of risks for the Company is captured by the operating management after serious deliberations on the nature of the and thereafter in a prioritized manner presented to the Board for their inputs on risk mitigation/management efforts.

5. Disclosure by Senior Management

Senior Management has made disclosures to the Board relating to all material financial and commercial transactions stating that they did not have personal interest that could result in a conflict with the interest of the Company at large.

6. CEO / CFO Certification

The Wholetime Director and Chief Financial Officer (CFO) have certified to the Board in accordance with Regulation 17 (8) and Part B of Schedule II of the Listing Regulations pertaining to CEO/CFO certification for the financial year ended 31 March 2017, which is annexed hereto.

7. Whistle Blower Policy/ Vigil Mechanisim

In compliance with section 177 of the Companies Act, 2013 and regulation 22 of the Listing Regulations, the Company has adopted a Whistle Blower Policy / Vigil Mechanisim which enables every employee of the Company to promptly report to the management about any actual or possible violations of the policy or an event he/ she becomes aware of that could affect the business or reputation of your Company. The Company affirms that no personnel has been denied access to the Audit Committee in respect to reporting of any unlawful information. The said policy has been also put up on the website of the Company at the following link:

http://leelelectric.com/pdf/Whistle-Blower-Policy-%20LEEL.pdf

8. Archival Policy

In accordance with the requirements of Regulation 30(8) of the Securities & Exchange Board of India (Listing Obligations and Disclosures Requirements), Regulations, 2015 (“Listing Regulations”), the listed entity shall disclose on its website all such events or information which is required to be disclosed to Stock Exchange(s) under Regulation 30, and such disclosures shall be hosted on the website of the listed entity for a minimum period of five years and thereafter as per the archival policy of the listed entity, as disclosed on its website.

The same are available at following link:

http://leelelectric.com/pdf/Archival%20Policy.pdf

9. Policy for Preservation of Documents

Pursuant to Regulation 9 of the Securities & Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations, 2015 (“Listing Regulations”), the Company has formulated a policy for prevention of documents.

This objective of the policy is to set the standards for storing and preservation of documents of the Company broadly classified in the following two categories:

a) documents whose preservation shall be permanent in nature;

b) documents with preservation period of not less than eight years after completion of the relevant transactions.

The same are available at following link:

http://leelelectric.com/pdf/Policy%20for%20preservation%20of%20documents.pdf

10. Subsidiary companies

The audit committee reviews the consolidated financial statements of the Company and the investments made by its unlisted subsidiary companies. The Company does not have any material non-listed Indian subsidiary companies. The Company has a policy for determining ‘material subsidiaries’ which is disclosed on its website at the following link:

http://leelelectric.com/pdf/Material%20Subsidiary%20Policy.pdf



11. Prohibition of Insider Trading

The Company has adopted a Code of Conduct to regulate, monitor and report trading by insiders under the SEBI (Prohibition of Insider Trading) Regulations, 2015. This Code of Conduct also includes code for practices and procedures for fair disclosure of unpublished price sensitive information and has been made available on the Company’s website at http://leelelectric.com/pdf/Code-of-Conduct-for-Prevention-of-Insider-Trading.pdf

12. Policy for Determining Materiality of Event / Information

The Company has also adopted Policy on Determination of Materiality for Disclosures, Policy on Archival of Documents and Policy for Preservation of Documents. The same are available at following link:

http://leelelectric.com/pdf/Policy%20for%20determining%20Matriality%20of%20Event%20or%20Information.pdf

13. Adoption of mandatory and discretionary requirements

The Company has complied with all the mandatory requirements as specified in the Listing Regulations.

The Company has adopted non-mandatory requirements as specified under Part E of Schedule II of the Listing Regulations such as financial statements of the Company are unqualified and the Internal Auditor directly reports to the Audit Committee.

14. Commodity price risk or foreign exchange risk and hedging activities;

Please refer management discussion analysis and notes to financial statements for details

15. Management Discussion And Analysis

The Management Discussion and Analysis forms part of the Annual Report and is given separately.

16. Disclosure of any non-compliances / penalty imposed

There were no non-compliances by the Company and no instances of penalties and strictures imposed on the Company by the Stock Exchanges or SEBI or any other statutory authority on any matter related to the capital market during the last three years.

DECLARATION OF CODE OF CONDUCTTo,

The Members of LEEL Electricals Limited

This is to confirm that the Company has obtained from all the members of the Board and the Senior Management Personnel, affirmations that they have complied with the Code of Conduct for Board Members and Senior Management Personnel in respect of the financial year ended March 31, 2017.

For LEEL Electricals Ltd.

Achin Kumar Roy Chairman of the Meeting & Date: August 10, 2017 Wholetime Director Place: New Delhi (DIN: 01475456)


73

CEO/ CFO CERTIFICATION(Under Regulation 17 (8) and Part B of Schedule II of

SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015)

The Board of DirectorsLEEL Electricals Limited159, Okhla Industrial Estate,Phase III, New Delhi 110020.

Sub. CEO/ CFO Certificate

We have reviewed the financial statements and the cash flow statement of LEEL Electricals Limited (Formerly Lloyd Electric & Engineering Ltd.) (herein after referred as ‘the Company’) for the year ended on March 31, 2017 and that to the best of our knowledge and belief:

(1) These statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;

(2) These statements together present a true and fair view of the Company’s affairs and are in compliance with existing accounting standards, applicable laws and regulations.

(3) There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year which are fraudulent, illegal or violative of the Company’s code of conduct.

(4) We accept responsibilities for established and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of internal control systems of the Company pertaining tofinancial reporting and we have disclosed to the auditors and the audit committee, deficiencies in the design or operation of such internal controls, if any, of which we are aware and the steps we have taken or propose totake to rectify these deficiencies.

We further certify that the following information have been indicated to the Auditors and the Audit Committee:

a) There have been no significant changes in internal control over financial reporting during the year;

b) There have been no significant changes in accounting policies during the year; and

c) There have been no instances of significant fraud of which they have become aware and the involvement thereinof the management or an employee having a significant role in the Company’s internal control system.

Yours sincerely

Mukat B. Sharma Achin Kumar RoyDate: May 30, 2017 Wholetime Director and CFO Wholetime DirectorPlace: New Delhi (DIN: 02942036) (DIN: 01475456)



COMPLIANCE CERTIFICATETo,The Members ofLEEL Electricals Limited

We have examined the compliance of conditions of Corporate Governance by LEEL Electricals Limited (Formerly Lloyd Electric & Engineering Ltd.) (‘the Company’), for the year ended 31st March, 2017, as stipulated as per the provisions of Regulation 34(3) and Schedule V(E) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, for the period 1st April, 2016 to 31st March, 2017.

The Compliance of conditions of Corporate Governance is the responsibility of the management. Our examination has been limited to a review of procedures and implementation thereof, adopted by the Company for ensuring the compliance with the conditions of 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 prescribed under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as applicable.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency of effectiveness with which the management has conducted the affairs of the Company.

For Suresh C. Mathur & Co. Chartered Accountants

Brijesh C. Mathur PartherDate: 10.08.2017 M. No. : 083540Place: New Delhi Firm Reg. No.: 000891N

Corporate overview Statutory reportS Financial StatementS

75

STANDALONE

FINANCIAL

STATEMENTS



INDEpENDENT AuDITOrS’ rEpOrT On Standalone IND AS Financial Statements

To the Members of LEEL Electricals Limited(Formerly known as Lloyd Electric & Engineering Limited)

Report on the Standalone Indian Accounting Standards (IND AS) Financial Statements

We have audited the accompanying standalone IND AS financial statements of LEEL Electricals Limited (Formerly known as Lloyd Electric & Engineering Limited) (‘the Company’), which comprise the balance sheet as at 31st March, 2017, the statement of profit and loss (including other comprehensive income), the statement of cash flows and the statement of changes in equity for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the IND AS Standalone Financial Statements

The 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 and presentation of these standalone IND AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the (IND AS) prescribed under Section 133 of the Act, read with the Companies (Accounts) Rules, 2014 and the Companies (Indian Accounting Standard) Rules, 2015, as amended. 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 standalone IND AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these standalone IND AS 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 standalone IND AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone IND AS financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the standalone IND AS 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 standalone IND AS 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 the standalone IND AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone IND AS 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, including IND AS, of the financial position of the Company as at 31st March, 2017 and its financial performance including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.


77

Emphasis of Matter

The Company had, with the approval of Board of Directors in its Board Meeting held on February 18, 2017 and shareholders’ approval by way of postal ballot, the result of which was declared on March 24, 2017, sold its Consumer Durables Business alongwith its Brand ‘LLOYD’ as a going concern on a slump sale basis to Havells India Limited. The aforesaid transaction was concluded on May 8, 2017 for a consideration of Rs.1,550 Crores subject to closing adjustments. The sale of the Consumer Durables Business will not have any impact on the Company’s existing B2B air conditioning business. Our opinion is not modified in respect of the matter.

Pursuant to aforesaid sale, the Company has also changed its name from ‘Lloyd Electric & Engineering Ltd.’ to ‘LEEL Electricals Ltd.’ with the approval of Central Government on May 23, 2017.

Report on Other Legal and Regulatory Requirements

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

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 statement of cash flows and the statement of changes in equity dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid standalone IND AS 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, 2017 and taken on record by the Board of Directors, none of the Directors is disqualified as on 31st March, 2017 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 B”; and

(g) With respect to the other matters to be included in the Auditors’ 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 standalone IND AS financial statements have disclosed the impact of pending litigations on the financial position of the Company as referred to in Note No. 36;

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

iii. The Company was not required to transfer funds to the Investor Education and Protection Fund during the financial year under review.

iv. The Company has provided requisite disclosures in its standalone IND AS financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016 and those are in accordance with the books of accounts maintained by the Company. Refer Note 48 of the standalone IND AS financial statements.

For Suresh C. Mathur & Co.Chartered Accountants

Firm Regn. No. 000891N

(Brijesh C. Mathur)Place: New Delhi PartnerDated: May 30, 2017 M. No. 083540



Annexure - A to the Auditors’ report The Annexure referred to in Independent Auditors’ Report to the members of the Company on the standalone IND AS financial statements for the year ended 31st March, 2017, we report that:

1. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation, of fixed assets.

(b) The fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of the fixed assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

2. a) The inventory has been physically verified during the year by the management at reasonable intervals.

b) The procedures of the physical verification of the inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of the Business.

c) The Company is maintaining proper records of the inventory. The discrepancies noticed on physical stocks and the book records were not material.

3. a) The Company has granted loans, secured or unsecured to companies, firm or other parties covered in the register maintained under section 189 of the Companies Act, 2013.

b) The loans granted to the bodies corporate listed in the register maintained under section 189 of the Act, the borrowers have been regular in the payment of the interest as stipulated. The terms of arrangements do not stipulate any repayment schedule in the loans are repayable on demand. Accordingly, paragraph 4(iii)(c) of the Order is not applicable to the Company in respect of repayment of the principal amount.

c) There are no overdue amounts in respect of the loans granted to the bodies corporate listed in the register maintained under section 189 of the Act.

4. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 185 and 186 of the Act, with respect to the loans and investments made.

5. According to the information and explanations given to us, the Company has not accepted any deposit, in terms of the directive issued by the Reserve Bank of India and the provisions of the Section 73 to 76 or any other relevant provisions of the Companies Act and the rules framed thereunder.

6. We have broadly reviewed the cost records maintained by the Company prescribed by the Central Government under Section 148(1) of the Companies Act, 2013 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

7. a) According to the records of the Company, the Company is regular in depositing undisputed Statutory dues including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Duty of Excise, Valued Added Tax, cess and any other statutory dues with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales Tax, Customs Duty, Service Tax, Excise Duty and Cess were outstanding, at the financial reporting period ending on 31st March, 2017 for a period of more than six months from the date they became payable.

b) As on 31st March, 2017 according to the records of the Company the following are the particulars of disputed dues on account of Excise duty, Custom duty, HP State Electricity Board & Income Tax and have not been deposited.


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Particulars Financial Year Amount(` In Crores)

Dispute Pending

HP Electricity Board 2009-2010 0.11 Divisional Commissioner Court Shimla Camp at NahanCentral Excise & Customs Matters*

2014-2015 2.97 Commissioner of Customs (Appeals), New Delhi2014-2015 0.11 CESTAT, Allahabad2014-2015 0.19 Deputy Commissioner of Customs, ICD TKD, New Delhi2015-2016 0.04 Deputy Commissioner, Customs, Noida

Income Tax Matters(Pending rectification)

2008-2009 0.15 Assessing officer, New Delhi2010-2011 0.25 Assessing officer, New Delhi2011-2012 0.04 Central Processing Centre2012-2013 0.82 Assessing officer, New Delhi2014-2015 1.69 Central Processing Centre

*In addition to the above, during the previous financial year, the Company has received total demand of Rs.46.23 Cr. under show cause notices from custom department. The Company has made suitable reply of the same.

8. In our opinion and according to the information and explanations given to us, the Company has not defaulted during the year in repayment of dues to its financial institutions, bankers and government. The Company did not have any outstanding debentures during the year.

9. In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained. The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) during the year.

10. According to the information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.

11. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.

12. In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, paragraph 3(xii) of the Order is not applicable.

13. According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

14. During the financial year the Company has issued and alloted 41.27 Lac Equity Shares of Rs.10 each at a premium of Rs.142 each to promoter group entities on preferential basis upon conversion of equivalent number of warrants. Consequent to the allotment, the Paid-up Equity Share Capital of the Company increased to Rs.40,33,22,600 divided into 4,03,32,260 Equity Shares of face value Rs.10 each. The said shares were duly listed and admitted to trade on BSE Ltd. vide its trading approval no. DCS/PREF/TP/MD/3598/2016-17 dated October 07, 2016 and on National Stock Exchange of India Ltd. vide its trading approval no. NSE/LIST/89739 dated 10th October, 2016. On Balance 9.88 lacs warrants, the warrant holders did not exercise their right to convert warrants as conversion of such number of warrants would have increased their shareholding beyond the permissible creeping limit of 5% in a financial year as stipulated in Regulation 3(2) of the SEBI (Substantial Acquisition of Shares & Takeovers) Regulations, 2011. Accordingly, 9.88 lacs warrants stand cancelled and the upfront subscription money aggregating to Rs.3.75 Crores received on said warrants at the time of their subscription was forfeited. Consequent upon the above allotments and forfeiture of warrants, there are no pending warrants due for conversion as on 31st March, 2017.

15. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with Directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.

16. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.






Annexure - B to the Auditors’ Report 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 over financial reporting of LEEL Electricals Limited (Formerly known as Lloyd Electric & Engineering Limited) (“the Company”) as of 31st March, 2017 in conjunction with our audit of the standalone IND AS financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (‘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.

Auditors’ Responsibility

Our 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 on Audit of Internal Financial Controls over Financial Reporting (the “Guidance Note”) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, 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 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 judgment, including the assessment of the risks of material misstatement of the standalone IND AS financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A 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 authorizations of management and Directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper


81

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.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March, 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.






BALANCE ShEEtAS At 31St MARCh 2017

(` In Crores)

Particulars Note No.

As at 31.03.2017

As at 31.03.2016

As at 01.04.2015

ASSETSNon Current AssetsProperty, Plant and Equipment 3 317.72 320.28 310.07 Capital Work in Progress 4 10.13 6.70 7.69 Intangible Assets 5 1.28 3.04 4.66 Financial Assets(i) Investments 6 108.45 105.72 90.00 (ii) Loans 7 6.90 7.59 2.76 (iii) Other Financial Assets 8 0.21 0.23 0.33 Other Non Current Assets 9 - 0.01 0.02

444.70 443.59 415.52 Current AssetsInventories 10 992.00 876.91 719.31 Financial Assets(i) Trade Receivables 11 693.60 597.14 456.98 (ii) Cash and Cash Equivalents 12 89.64 65.37 56.26 (iii) Bank Balance other than (ii) above 13 1.50 1.18 1.16 (iv) Loans 14 1.54 1.54 0.85 (v) Other Financial assets 15 6.04 6.62 0.04 Current Tax Assets (Net) - - 6.90 Other Current Assets 16 111.28 75.07 98.41

1,895.61 1,623.83 1,339.90 TOTAL ASSETS 2,340.31 2,067.42 1,755.42

EQUItY AND LIABILItIESEquityEquity Share Capital 17 40.34 36.21 35.33 Other Equity 18 881.01 758.27 709.13

921.35 794.48 744.46 Non Current LiabilitiesFinancial LiabilitiesBorrowings 19 50.95 77.26 89.46 Long term Provisions 20 7.09 2.81 3.08 Deffered Tax Liabilities 21 0.65 3.25 3.55

58.68 83.31 96.09 Current LiabilitiesFinancial Liabilities(i) Borrowings 22 1,025.08 898.31 703.11 (ii) Trade Payables 23 133.02 113.15 104.56 (iii) Other Financial Liabilities 24 58.99 89.44 61.53

Other Current Liabilities 25 116.94 77.13 44.22 Short Term Provisions 26 6.36 6.10 1.46 Current Tax Liabilities (Net) 19.89 5.49 -

1,360.27 1,189.63 914.88 tOtAL EQUItY AND LIABILItIES 2,340.31 2,067.42 1,755.42 NOTES TO ACCOuNTSAccompanying Notes are an integral part of the Financial Statements

As per our Report of even date attached For Suresh C. Mathur & Co. For and on behalf of the BoardChartered Accountants

(Brijesh C. Mathur) Mukat B. Sharma Achin Kumar RoyPartner Whole Time Director & CFO Whole Time Director &Membership No. 083540 (DIN:02942036) Chairman of the Meeting Firm Registration No. 000891N (DIN:01475456)

Anita K. Sharma Surjit Krishan SharmaPlace:- New Delhi Company Secretary & VP Finance DirectorDated:-30.05.2017 (FCS 7373) (DIN:00058581)


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STATEMENT OF prOFIT AND LOSSFOR thE YEAR ENDED 31St MARCh 2017

(` In Crores)


For the year ended 31.03.2017

For the year ended31.03.2016

RevenueRevenue from operations 27 3,022.43 2,387.63 Other income 28 1.98 1.05 Total Income 3,024.41 2,388.68 ExpensesCost of materials consumed 29 2,198.77 1,700.22 Purchases of Stock-in-Trade 30 270.13 142.74 Changes in inventories of finished goods work-in-progress and Stock-in-Trade 31 (62.14) (4.91)Excise duty on Sale of goods 45.12 51.98 Employee benefits expense 32 96.69 72.15 Finance costs 33 118.89 105.30 Depreciation and amortization expense 34 35.98 33.20 Other expenses 35 202.00 162.73 Total Expenses 2,905.44 2,263.41 Profit before exceptional items and tax 118.97 125.27 Exceptional Items Insurance claims written off - 45.80 Profit before tax 118.97 79.47 tax expense:(1) Current tax 36.20 17.00 (2) Deferred tax (2.37) (0.30)(3) MAT Credit Entitlement - 6.94 Profit for the year 85.14 55.82 Other Comprehensive IncomeItems that will be reclassified to profit or loss Fair value of Investment 0.79 0.71 Acturial gain or losses (0.68) - Taxes 0.23 - total Comprehensive Income for the year 85.49 56.53

Earnings per Equity Share(1) Basic 21.19 15.61 (2) Diluted 21.19 13.68 NOTES TO ACCOuNTSAccompanying Notes are an integral part of the Financial Statements






StAtEMENt OF ChANgES IN EQUItYAS ON 31St MARCh 2017

A. Equity Share Capital

Particulars No. of Shares (` In Crores)Paid up Capital 35,320,260 35.32 Add: Equity Shares forfeited - 0.01 As at April 1, 2015 35,320,260 35.33 Add: Equity Shares issued under Warrants 885,000 0.89 As at March 31, 2016 36,205,260 36.21 Add: Equity Shares issued under Warrants 4,127,000 4.13 As at March 31, 2017 40,332,260 40.34

B. Other Equity (` In Crores)

Particulars Reserves & Surplus Other Comprehensive Income

Total Other EquityEquity

Component of Other Financial

Instruments (Share

Warrants)

Capital Reserve (Share

Warrant Forefeited

by the Company)

Revaluation Reserve

(Land Revalued as on 31st

March, 1993)

Securities premium Account

general Reserve

retained Earning

Fair Value of

Investment

Acturial gain & Losses

Balance as at 1st April, 2015 22.80 11.25 0.23 199.07 202.72 273.59 (0.53) - 709.13

Profit for the Year - - - - - 55.82 - - 55.82

Transfer Share Warrant into Shares (3.36) - - - - - - - (3.36)

Premium Amount from Conversion of Warrants

- - - 12.57 - - - - 12.57

Addition in Fair Value of Investment - - - - - - 0.71 - 0.71

Transfer from OCI to Retained Earnings

- - - - - (0.42) 0.42 - -

MAT Credit Adjustment - - - - - (11.09) - - (11.09)

Dividend (Including Dividend Tax) - - - - - (5.51) - - (5.51)

Transfer to Reserve - - - - 15.00 (15.00) - - -

Balance as at 31st March, 2016 19.44 11.25 0.23 211.64 217.72 297.39 0.60 - 758.27

Profit for the Year - - - - - 85.14 - - 85.14

Transfer Share Warrant into Shares (19.44) - - - - - - - (19.44)


- - - 58.60 - - - - 58.60

Addition in Fair Value of Investment - - - - - - 0.79 - 0.79

Acturial Gain & Loss - - - - - - - (0.44) (0.44)

Share Warrant Forfeited - 3.75 - - - - - - 3.75

Dividend (Including Dividend Tax) - - - - - (5.66) - - (5.66)

Transfer to Reserve - - - - 30.00 (30.00) - - -

Balance as at 31st March, 2017 - 15.00 0.23 270.24 247.72 346.87 1.39 (0.44) 881.01





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StAtEMENt OF CASh FLOWFOR thE YEAR ENDED 31St MARCh 2017

(` In Crores)

Particulars For the Year ended 31 March 2017

For the Year ended 31 March 2016

A Cash Flow from Operating Activities1 Profit Before tax

Profit before tax 118.97 79.47 2 Adjustments for :

Depreciation 35.98 33.20 Loss/(gain) on disposal of property, plant and equipments (net) (0.07) 0.10 Life Time Credit Risk 0.27 0.30 Finance costs 118.89 105.30 Dividend Received (0.02) (0.05)Loss/(gain) arising on financial assets/liabilities as at fair value through profit and loss 0.04 0.12 Interest Income (1.32) (0.24)

3 Operating Profit before Working Capital Changes (1+2) 272.73 218.19 4 Net Change in:

Trade Receivables (96.46) (140.16)Inventories (115.09) (157.60)Other Financial Assets 0.60 (6.49)Loans 0.69 (5.54)Other Assets (36.20) 23.34 Trade Payable 19.87 8.59 Other Financial Liabilities (30.46) 27.92 Other Liabilities 39.81 32.92 Provisions 4.35 4.37 Change in Working Capital (212.88) (212.66)

5 Cash generated from Operating Activities (3+4) 59.85 5.53 6 Taxes paid (21.80) (23.24)7 Net Cash Flow from Operating Activities (5-6) 38.04 (17.70)B Cash Flow from Investing Activities:

Purchase of Property, plant and equipment including CWIP (35.11) (41.49)Proceeds from disposal of Property, plant & equipment 0.09 1.48 Purchase of Investments (2.73) (15.73)Interest received 1.32 0.24 Dividend Income 0.02 0.05 Net Cash generated/(Used) in Investing Activities: (36.40) (55.45)

C Net Cash Flow From Financing Activities:Proceeds from Issue of Share Capital 47.05 10.09 Proceeds from Borrowing 100.46 183.00 Interest paid (118.89) (105.30)Dividends paid (including dividend tax) (5.66) (5.51)Net Cash generated/(Used) from Financing Activities: 22.95 82.28

D Net Change in Cash & cash equivalents (A+B+C) 24.60 9.12 E Net increase/ decrease in Cash and Cash Equivalents 24.60 9.12

Opening Balance of Cash and Cash Equivalents 66.54 57.42 Closing Balance of Cash and Cash Equivalents 91.14 66.54






NOtES tO thE FINANCIAL StAtEMENtSFOR thE YEAR ENDED 31 MARCh 2017

1. Corporate Information

LEEL Electricals Limited (Formerly known as Lloyd Electric & Engineering Limited) is a public Company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on National Stock Exchange of India Limited (NSE) & BSE Limited (BSE) in India. The Company is the largest manufacturer of heat exchangers coils in India. It manufactures air conditioners for various brands as OEM / ODM including its own brand of LLOYD. During the year the Company was also engaged in the consumer durable business under “Lloyd” brand which includes product portfolio like Air-Conditioner, LED TV, Washing Machines, Chest Freezers and other small home appliances. The company caters to both domestic and international markets. The Company has sold its consumer durable business to Havells India Ltd. for details please refer note no. 49.

2. Significant Accounting Policies

2.1 Basis of preparation

The Company has adopted accounting policies that comply with Indian Accounting standards (INDAS or IND AS) notified by Ministry of Corporate Affairs vide notification dated 16th February, 2015 under Section 133 of the Companies Act 2013. Accounting policies have been applied consistently to all periods presented in these financial statements. The financial statements referred hereinafter have been prepared in accordance with the requirements and instructions of Schedule III to the Companies Act, 2013, amended from time to time applicable to Companies to whom IND AS applies.

The opening financial statements have been prepared in accordance with “Indian Accounting Standard 101 (First time Adoption of Indian Accounting Standards)”. The opening financial statements comprise Balance Sheet, Statement of Change in equity and its related notes.

The adopted accounting policies comply with each IND AS effective at the end of its first IND AS reporting period i.e. 31st March, 2017 except as specified in paragraphs 13–19 and Appendices B–D of IND AS 101. In the opening financial statements:

(i) All assets and liabilities have been recognized as required by IND AS.

(ii) All assets and liabilities have been derecognized which are not permitted by IND AS.

(iii) All assets, liabilities or components of equity have been reclassified in accordance with IND AS.

(iv) All assets and liabilities have been measured in accordance with IND AS.

The accounting policies used by the Company in its opening financial statement may differ from those previously used in accordance with Indian Generally Accepted Accounting Principles (GAAP) or the previous GAAP. The resulting adjustments, which have arises for events and transactions before the date of transition to IND AS, have been directly recognized in retained earnings at the date of transition to IND AS i.e. 1st April, 2015 (or, if appropriate, another category of equity) at the date of transition to IND AS.

The company estimates in accordance with IND AS at the date of transition to IND AS are consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

The company has explained how the transition from previous GAAP to IND AS has affected its reported Balance sheet and Statement of Profit & loss. Accordingly, The Company’s first IND AS financial statements includes:

a. Reconciliations of its equity reported in accordance with previous GAAP to its equity in accordance with IND AS for both of the following dates:

(i) the date of transition to IND AS; and

(ii) the end of the latest period presented in the Company’s most recent annual financial statements in accordance with previous GAAP.


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b. Reconciliation to its total comprehensive income in accordance with IND AS for the latest period in the Company’s most recent annual financial statements. The starting point for that reconciliation being the profit or loss under previous GAAP.

The Company’s first IND AS financial statements includes three Balance Sheets, two Statements of profit and loss and two Statements of changes in equity and two cash flow and related notes.

The Company’s first financial statements have been prepared in accordance with the IND AS prescribed. The preparation of the Company’s first financial statements in conformity with IND AS requires the Company to exercise its judgement in the process of applying the accounting policies. It also requires the use of accounting estimates and assumptions that effect the reported amounts of assets and liabilities at the date of the financial statements. These estimates and assumptions are assessed on an ongoing basis and are based on experience and relevant factors, including expectations of future events that are believed to be reasonable under the circumstances and presented under the historical cost convention on accrual basis of accounting.

2.2 Use of Estimates

The preparation of financial statements require estimates and assumptions to be made that affect the reported amount of asset and liabilities on the date of the financial statements and the reported amount of the revenue and the expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

2.3 Property, Plant and Equipment (PPE)

The Company has elected to use a previous GAAP cost (cost less accumulated depreciation and impairment losses (if any)) of an item of property, plant and equipment at, or before, the date of transition to IND AS as deemed cost at the date of transition in accordance with accounting policy option available in IND AS 101.

PPE are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. The initial cost of PPE comprise its purchase price, including import duties, net of MODVAT/CENVAT, less accumulated depreciation and include any directly attributable costs of bringing an asset to working condition and location for its intended use, including borrowing costs relating to the qualified asset over the period up to the date the assets are put to use is included in cost of relevant assets. Exchange rate variations relating to long term monetary items is charged to profit & loss if foreign currency loan is taken after March 31, 2016.

All other expenditure related to existing assets including day-to-day repair and maintenance expenditure and cost of replacing parts, are charged to the statement of profit and loss in the period during which such expenditure is incurred.

The carrying amount of a property, plant and equipment is de-recognized when no future economic benefits are expected from its use or on disposal.

Machine spares that can be used only in connection with an item of fixed asset and their use is expected for more than one year are capitalized.

Depreciation on property plant and equipment is provided on straight line method based on estimated useful life of assets as prescribed in schedule II to the Companies Act, 2013. Estimated useful lives of the assets are as follow:-

Class of Assets Rate of Depreciation

Buildings 30 Years

Plant & Machinery 15 Years

Office Equipment 5 Years

Furniture & Fixtures 10 Years

Vehicles 8 Years

The property, plant and equipment acquired under finance leases, if any, is depreciated over the asset’s useful life or over the shorter of the asset’s useful life and the lease term if there is no reasonable certainty that the Company will obtain ownership at the end of the lease term.



Depreciation on the assets purchased during the year is provided on pro-rata basis from the date of purchase of the assets.

Gains and losses on de-recognition/disposals are determined as the difference between the net disposal proceeds and the carrying amount of those assets. Gains and Losses if any, are recognized in the statement of profit or loss on de-recognition or disposal as the case may be.

Capital Work-in-Progress

Projects under commissioning and other Capital Work-in-Progress are carried at cost, comprising direct cost, related incidental expenses and attributable interest.

2.4 Intangible Assets

The company has elected to use a previous GAAP cost (cost less accumulated depreciation and impairment losses (if any)) of an intangible assets at, or before, the date of transition to IND AS as deemed cost at the date of transition in accordance with accounting policy option in IND AS 101.

Intangible assets acquired separately are measured on initial recognition at cost less accumulated amortization and accumulated impairment losses, if any.

The cost of an intangible asset includes purchase cost (net of rebates and discounts), including any import duties and non-refundable taxes and any directly attributable costs on making the asset ready for its intended use.

The Cost of Intangible assets are amortized on a straight line basis over their estimated useful life which is as follows:

Logo of Brand “LLOYD”

Cost of logo is amortized over its useful life of 6 years.

Product Development Expenses

Cost of Product Development expenses will be amortized over its useful life of 5 Years.

The amortization period and method are reviewed at least at each financial year end. If the expected useful life of the asset is significantly different from previous estimates, the amortization period is changed accordingly.

An intangible asset is derecognized on disposal or when no future economic benefits are expected from use. Gains and losses arising from de-recognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset are recognized in the statement of profit and loss when the asset is derecognized or on disposal.

2.5 Inventories

Raw materials and consumables are valued at cost and includes purchase price, freight costs, customs duty (wherever paid) and are net of credit availed under CENVAT scheme. The cost is determined using the Weighted Average Method.

Stock in process is valued at own production costs after providing for obsolescence, if any. The own production costs includes direct and indirect materials, direct and indirect labour and other manufacturing overheads incurred in bringing them to their respective present location and condition.

Finished goods are valued at lower of own production costs on the basis of Weighted average method or net realizable value, after providing for obsolescence, if any. The own production costs includes direct and indirect materials, direct and indirect labour and other manufacturing overheads incurred in bringing them to their respective present location and condition.

Stock in transit lying in customs warehouse is valued at cost but does not include custom duty payable, however, non-provision of duty does not affect the profit for the year.

2.6 Impairment of tangible assets and intangible assets

At the end of each reporting period, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication based on internal/ external factors that those assets have suffered an impairment


89

loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). When it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs. When a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified.

Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment at least annually, and whenever there is an indication that the asset may be impaired.

Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognized immediately in profit or loss.

The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount

2.7 Foreign Exchange transactions

These financial statements are presented in Indian rupees (INR), which is the Company’s functional currency Transactions in foreign currency are recorded on initial recognition at the spot rate prevailing at the time of the transaction.

At the end of each reporting period

Monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date.

Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined.

Non-monetary items that are measured terms of historical cost in a foreign currency are not retranslated

Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition during the period or in previous financial statements are recognized in profit or loss in the period in which they arise.

Exchange differences on monetary items are recognized in profit or loss in the period in which they arise except for:

Exchange differences on foreign currency borrowings relating to assets under construction for future productive use, which are included in the cost of those assets when they are regarded as adjustment to interest costs on those foreign currency borrowings

The exchange differences arising on reporting of long term foreign currency monetary items at rates different from those at which they were initially recorded in so far as they relate to the acquisition of depreciable capital assets are shown by addition to/deduction from the cost of the assets as per exemption provided under IND AS 21 read along with IND AS 101 appendix ‘D’ clause-D13AA.

Exchange differences on monetary items receivable from or payable to a foreign operation which settlement is neither planned nor likely to occur (therefore forming part of the investment in the foreign operation), which are recognized initially in other comprehensive income and reclassified from equity to profit or loss on repayment of the monetary items.

Forward Exchange Contracts not intended for trading or speculation purposes

The premium or discount arising at the inception of forward exchange contract is amortized and recognized as an expense/ income over the life of the contract. Exchange differences on such contracts, except the contracts which are long-term foreign currency monetary items, are recognized in the statement of profit and loss in the period in which the exchange



rates change. Any profit or loss arising on cancellation or renewal of such forward exchange contract is also recognized as income or as expense for the year.

2.8 Borrowing Cost

Borrowing costs specifically relating to the acquisition or construction of a qualifying asset that necessarily takes a substantial period of time to get ready for its intended use are capitalized as part of the cost of the asset. All other borrowing costs are charged to profit & loss account in the period in which it is incurred except loan processing fees which is recognized as per Effective Interest Rate method. Borrowing costs consist of interest and other costs that company incurs in connection with the borrowing of funds. Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing costs.

2.9 Employee Benefits

Contribution to Provident fund/Pension fund: Retirement benefits in the form of Provident Fund / Pension Schemes are defined contribution schemes and the contributions are charged to the Profit & Loss Account in the year when the contributions to the respective funds become due. The Company has no obligation other than contribution payable to these funds.

Gratuity liability is a defined benefit obligation and is provided for on the basis of an actuarial valuation made at the end of each financial year. However, The Company is in process of having arrangement with Insurance co. to administer its Superannuation & Gratuity Fund.

Defined benefit plans: Defined benefit costs are categorized as follows:

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

• net interest expense or income; and

• measurement

The company presents the first two components of defined benefit costs in profit or loss in the line item ‘Employee benefits expense’. Curtailment gains and losses are accounted for as past service costs.

Remeasurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding net interest), is reflected immediately in the balance sheet with a charge or credit recognized in other comprehensive income in the period in which they occur. Remeasurement recognized in other comprehensive income is reflected immediately in retained earnings and is not reclassified to profit or loss. Past service cost is recognized in profit or loss in the period of a plan amendment.

Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset.

For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period.

The retirement benefit obligation recognized in the balance sheet represents the actual deficit or surplus in the Company’s defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.

Liability for a termination benefit is recognized at the earlier of when the Company can no longer withdraw the offer of the termination benefit and when the Company recognizes any related restructuring costs.

Short-term and other long-term employee benefits: A liability is recognized for benefits accruing to employees in respect of wages and salaries, annual leave and sick leave in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchange for that service. These benefits include bonus/incentives and compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related service.


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Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for the related service.

Liabilities recognized in respect of other long-term employee benefits are measured at the present value of the estimated future cash outflows expected to be made by the Company in respect of services provided by employees up to the reporting date.

Accumulated leave, which is expected to be utilized within the next 12 months, is treated as short-term employee benefit. The Company measures the expected cost of such absences as the additional amount that it expects to pay as a result of the unused entitlement that has accumulated at the reporting date

The cost of the defined benefit gratuity plan and their present value are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

The most sensitive is discount rate. The management has considers the interest rates of government bonds. Future salary increases and gratuity increases are based on expected future inflation rates.

2.10 tax Expenses

Income Tax expense comprises of current tax and deferred tax charge or credit. Provision for current tax is made with reference to taxable income computed for the financial year for which the financial statements are prepared by applying the tax rates as applicable.

Current tax: Current Income tax relating to items recognized outside the profit and loss is recognized outside the profit and loss (either in other comprehensive income or in equity)

Deferred tax: Deferred tax is provided using the balance sheet approach on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purpose at reporting date. Deferred income tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of changes in tax rates on deferred income tax assets and liabilities is recognized as income or expense in the period that includes the enactment or the substantive enactment date. A deferred income tax asset is recognized to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences and tax losses can be utilized.

The carrying amount of deferred tax assets is reviewed as at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will not be available against which deferred tax asset to be utilized. Unrecognized deferred tax assets are re-assessed at each reporting date and are recognized to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

Deferred tax assets are recognized for the unused tax credit to the extent that it is probable that taxable profits will be available against which the losses will be utilized. Significant management judgment is required to determine the amount of deferred tax assets that can be recognized, based upon the likely timing and the level of future taxable profits.

2.11 Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

A lease is classified at the inception date as a finance lease or an operating lease. A lease that transfers substantially all the risks and rewards incidental to ownership to the Company is classified as a finance lease. When acquired, such assets are capitalized at fair value of the leased property or present value of minimum lease payments, at the inception of lease, whichever is lower.

Other leases are Operating leases. Operating lease payments are recognized as an expense in the statement of profit and loss on a straight line basis over the lease term. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and amortized over the lease term on the straight line basis.



As a Lessor: Leases in which the Company does not transfer substantially all the risks and rewards of ownership of an asset are classified as operating leases. Assets subject to operating leases are included in PPE. Rental income from operating lease is recognized on a straight-line basis over the term of the relevant lease. Where the rentals are structured solely to increase in line with expected general inflation to compensate for the company’s expected inflationary cost increases, such increases are recognized in the year in which such benefits accrue.

Costs, including depreciation, are recognized as an expense in the statement of profit and loss. Initial direct costs such as legal costs, brokerage costs, etc. are recognized immediately in the statement of profit and loss.

As a lessee: Leases in which significant portions of risks and reward of ownership are not transferred to the company as lessee are classified as operating leases. Operating lease payments are recognized as an expense in the Profit and Loss account on a straight-line basis over the lease term. Where the rentals are structured solely to increase in line with expected general inflation to compensate for the lessor’s expected inflationary cost increases, such increases are recognized in the year in which such benefits accrue. Contingent rentals arising under operating leases are recognized as an expense in the period in which they are incurred.

Leases where the lessor effectively transfers substantially all the risks and benefits of ownership of the asset are classified as finance leases and are capitalized at the inception of the lease term at the lower of the fair value of the leased property and present value of minimum lease payments. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognized as finance costs in the statement of profit and loss. Lease management fees, legal charges and other initial direct costs of lease are capitalized.

For arrangements entered into prior to 1 April 2015, the Company has determined whether the arrangement contain lease on the basis of facts and circumstances existing on the date of transition in accordance with IND AS 101 “First time adoption of Indian Accounting Standards”.

2.12 Fair Value Measurement

The Company measures certain financial instruments at fair value at each balance sheet date.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

ii) In the principal market for the asset or liability, or

iii) In the absence of a principal market, in the most advantageous market for the asset or liability

The principal or the most advantageous market must be accessible by the Company.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities

Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable


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Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For assets and liabilities that are recognized in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

For the purpose of fair value disclosures, the Company has determined classes of assets & liabilities on the basis of the nature, characteristics and the risks of the asset or liability and the level of the fair value hierarchy as explained above.

2.13 Financial Instrument

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Financial asset is any assets that is

Cash;

an equity instrument of another entity;

a contractual right:

(i) to receive cash or another financial asset from another entity; or

(ii) to exchange financial assets or financial liabilities with another entity under conditions that are potentially favorable to the entity; or

a contract that will or may be settled in the entity’s own equity instruments and is:

(i) a non-derivative for which the entity is or may be obliged to receive a variable number of the entity’s own equity instruments; or

(ii) a derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments.

Financial assets includes non-current investments, loan to employees, security deposits, trade receivables and other eligible current and non-current assets

Financial Liability is any liabilities that is

a contractual obligation :

(i) to deliver cash or another financial asset to another entity; or

(ii) to exchange financial assets or financial liabilities with another entity under conditions that are potentially unfavorable to the entity; or


(i) a non-derivative for which the entity is or may be obliged to deliver a variable number of the entity’s own equity instruments; or

(ii) a derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments. For this purpose, rights, options or warrants to acquire a fixed number of the entity’s own equity instruments for a fixed amount of any currency are equity instruments if the entity offers the rights, options or warrants pro rata to all of its existing owners of the same class of its own non-derivative equity instruments.

Financial liabilities includes Loans, trade payable and eligible current and non-current liabilities.



i) transitional Provisions in opening balance sheet per IND AS 101

The Company designates a previously recognized financial asset/financial liability as a financial asset/ financial liability measured at fair value on the basis of the facts and circumstances that exist at the date of transition to IND AS.

The Company designates an investment in an equity instrument other than investment in subsidiary, associates and Joint venture as at fair value through other comprehensive income on the basis of the facts and circumstances that exist at the date of transition to IND AS.

The Company has assessed whether a financial asset meets the conditions w.r.t classification criteria on the basis of the facts and circumstances that exist at the date of transition to Ind Ass, practically feasible.

ii) Classification:

The Company classifies financial assets as subsequently measured at amortized cost, fair value through other comprehensive income or fair value through profit or loss on the basis of both:

• the entity’s business model for managing the financial assets and

• the contractual cash flow characteristics of the financial asset.

A financial asset is measured at amortized cost if both of the following conditions are met, the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and

• the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A financial asset is measured at fair value through other comprehensive income if both of the following conditions are met:

• the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and


A financial asset is measured at fair value through profit or loss unless it is measured at amortized cost or at fair value through other comprehensive income.

All financial liabilities are subsequently measured at amortized cost using the effective interest method or fair value through profit or loss.

iii) Initial recognition and measurement

The company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of the instrument. All financial assets and liabilities are recognized at fair value at initial recognition, plus or minus, any transaction cost that are directly attributable to the acquisition or issue of financial assets and financial liabilities that are not at fair value through profit or loss.

iv) Financial assets subsequent measurement

Financial assets as subsequent measured at amortized cost, fair value through other comprehensive income (FVOCI) or fair value through profit or loss (FVTPL) as the case may be.

Financial liabilities as subsequent measured at amortized cost or fair value through profit or loss

v) Effective interest method

The effective interest method is a method of calculating the amortized cost of a debt instrument and allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees and points paid or received that form integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt instrument, or, where appropriate, a shorter period, to the net carrying amount on initial recognition.


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Income is recognized on an effective interest basis for debt instruments other than those financial a classified as at FVTPL. Interest income is recognized in profit or loss and is included in the “Other income” line item.

vi) trade Receivables

Trade receivables are the contractual right to receive cash or other financial assets and recognized initially at fair value. Subsequently measured at amortized cost (Initial fair value less expected credit loss). Expected credit loss is the difference between all contractual cash flows that are due to the company and all that the company expects to receive (i.e. all cash shortfall), discounted at the effective interest rate.

vii) Equity investments

All equity investments in scope of IND AS 109 are measured at fair value other than investment in subsidiary, Associates and Joint venture. For all other equity instruments, the company may make an irrevocable election to present in other comprehensive income subsequent changes in the fair value. The Company makes such election on an instrument by- instrument basis

viii) Cash and cash Equivalents

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.

ix) Impairment of Financial Assets

The company recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are not fair valued through profit or loss. Loss allowance for trade receivables with no significant financing component is measured at an amount equal to lifetime ECL. For all other financial assets, expected credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognized is recognized as an impairment gain or loss in profit or loss.

x) Financial liabilities

Financial liabilities are recognized initially at fair value less any directly attributable transaction costs. These are subsequently carried at amortized cost using the effective interest method or fair value through profit or loss. For trade and other payables maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments

xi) trade payables

Trade payables represent liabilities for goods and services provided to the Company prior to the end of financial year and which are unpaid. Trade payables are presented as current liabilities unless payment is not due within 12 months after the reporting period or not paid/payable within operating cycle. They are recognized initially at their fair value and subsequently measured at amortized cost using the effective interest method.

xii) Borrowings

Borrowings are initially recognized at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan.

Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period. Where there is a breach of a material provision of a long-term loan arrangement on or before the end of the reporting period with the effect that the liability becomes payable on demand on the reporting date, the company does not classify the liability as current, if the lender agreed, after the reporting period and before the approval of the financial statements for issue, not to demand payment as a consequence of the breach.



xiii) Equity Instruments

An equity instrument is any contract that evidences a residual interest in the assets of company after deducting all of its liabilities. Equity instruments are recognized at the proceeds received, net of direct issue costs.

xiv) De-recognition of financial instrument

The company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for de-recognition under IND AS 109. A financial liability (or a part of a financial liability) is derecognized from the company’s balance sheet when the obligation specified in the contract is discharged or cancelled or expires.

xv) Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously

xvi) Derivative Financial Instruments

Derivatives are initially recognized at fair value at the date the derivative contracts are entered and are subsequently re-measured to their fair value at the end of each reporting period. The resulting gain or loss is recognized in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss.

2.14 Provision and Contingent Liability

i. A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements.

ii. Contingent liabilities, if material, are disclosed by way of notes unless the possibility of an outflow of resources embodying the economic benefit is remote and contingent assets, if any, is disclosed in the notes to financial statements.

iii. A provision is recognized, when company has a present obligation (legal or constructive) as a result of past events and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, in respect of which a reliable estimate can be made for the amount of obligation. The expense relating to the provision is presented in the profit and loss net of any reimbursement.

2.15 Earnings Per Share

Basic Earnings per share is computed by dividing the net profit after tax by the weighted average number of equity shares outstanding during the period. For the purpose of calculating Diluted earnings per share, the net profit for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

2.16 Revenue

Revenue is measured at the fair value of the consideration received or receivable, taking into account the contractually defined terms of payment net of returns and allowances, trade discounts and volume rebates, excluding taxes or duties collected on behalf of the government. Excise duty is the liability of manufacturer which forms the part of cost of production, irrespective of whether the goods are sold or not. Since the recovery of excise duty flows to the company on its own account, revenue includes excise duty. However, sales tax/ value added tax (VAT) is not received by the Company on its own account; rather it is tax collected on the value added to the commodity by the seller on behalf of the government, and hence it is excluded from revenue.


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Revenue is recognized only when the significant risk and reward of the ownership is transferred to the buyer usually on delivery of the goods. Revenue is recognized to the extent that it is probable that the economic benefit will flow to the company, revenue can be reliably measured and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Further, sales include revision in prices received from customers with retrospective effect. Similarly, price revision for material purchased has also been included in purchases. Further adjustments, if any, are made in the year of final settlement.

Interest Income is recognized using the effective interest rate (EIR). EIR is the rate that exactly discounts the estimated future cash flows over the expected life of financial instrument, to the gross carrying amount of the financial assets or to the amortized cost of the financial liability.

Dividend income is recognized when the Company’s right to receive payment is established. (Provided that it is probable that the economic benefit will flow to the company).

Export sales are accounted on the basis of date of bill of lading.

Payments made in respect of goods cleared as also provision made for goods lying in bonded warehouse.

2.17 Operating cycle

Based on the nature of products / activities of the Company and the normal time between acquisition of assets and their realization in cash or cash equivalents, the Company has determined its operating cycle as 12 months for the purpose of classification of its assets and liabilities as current and non-current.

2.18 Investments

Investments are either classified as current or long term investment based on Management’s intention. Current investments (if any) are carried at the lower of cost and fair value of each investment individually. Investments in subsidiary company are of long-term strategic value. Cost for overseas investments comprises the Indian rupee value of the consideration paid for the investment translated at the exchange rate prevalent at the date of investment. Long term investments are carried at cost less provisions recorded to recognize any decline, other than temporary, in the carrying value of each investment.

2.19 Segment Reporting

i. Business Segment

As per IND AS 108, the Company has reportable segments viz. Radiators & Heat Exchanger, OEM & Railways, Consumer Durable Products during the year under review. Accordingly the reporting is done segment wise.

ii. geographical Segment

The analysis of geographical segment is based on the geographical location of the customers. The Company operates primarily in India and has presence in international markets as well. Its business is accordingly aligned geographically, catering to two markets. The Company has considered domestic and exports markets as geographical segments and accordingly disclosed these as separate segments. The geographical segments considered for disclosure are as follows;

- Sales within India represent sales made to customers located within India.

- Sales outside India represent sales made to customers located outside India.

2.20 grants

Grants are recognized when there is reasonable assurance that the grant will be received and conditions attached to them are complied with.

2.21 Research and development

Research costs are expensed as incurred.



NOtE 3: PROPERtY, PLANt & EQUIPMENtthe Changes in the carrying value of property, plant and equipment for the year ended 31st March 2017 were as follows:

(` In Crores)Particulars Leasehold

Landtemporary

Constructions Buildings plant &

MachineryOffice

EquipmentVehicles Furniture

& FixturesTotal

Gross Carrying Value as on 1st April 2016 1.44 0.12 62.85 442.49 6.50 7.32 3.07 523.80 Additions - - 0.58 29.09 0.98 0.12 0.90 31.68 Deletions - - - 0.02 - 0.22 - 0.24 Gross Carrying Value as on 31st March 2017 1.44 0.12 63.43 471.56 7.49 7.22 3.98 555.23

Accumulated Depreciation as of 1st April 2016

- 0.11 11.17 182.97 4.25 3.94 1.08 203.52

Depreciation for the year - - 1.99 30.30 0.97 0.64 0.32 34.21 Adjustment - - - (0.00) - (0.22) - (0.22)Accumulated Depreciation as of 31st March 2017

- 0.11 13.15 213.27 5.22 4.36 1.40 237.51

Net Carrying Value as on 31st March 2017 1.44 0.01 50.28 258.30 2.27 2.86 2.57 317.72 Net Carrying Value as on 31st March 2016 1.44 0.01 51.69 259.52 2.25 3.38 1.99 320.28

the Changes in the carrying value of property, plant and equipment for the year ended 31st March 2016 were as follows:(` In Crores)

Particulars Leasehold Land

temporary Constructions

Buildings plant & Machinery

Office Equipment

Vehicles Furniture & Fixtures

Total

Gross Carrying Value as on 1st April 2015 2.33 0.12 59.20 407.94 5.06 6.51 2.59 483.76 Additions - - 3.78 35.11 1.44 1.66 0.48 42.48 Deletions 0.89 - 0.13 0.56 - 0.85 0.00 2.44 Gross Carrying Value as on 31st March 2016

1.44 0.12 62.85 442.49 6.50 7.32 3.07 523.80


- 0.11 9.32 154.89 3.47 4.23 0.78 172.80

Depreciation for the year - - 1.86 28.11 0.78 0.52 0.30 31.58 Adjustment - - (0.02) (0.03) - (0.82) - (0.86)Accumulated Depreciation as of 31st March 2016

- 0.11 11.17 182.97 4.25 3.94 1.08 203.52

Net Carrying Value as on 31st March 2016 1.44 0.01 51.69 259.52 2.25 3.38 1.99 320.28 Net Carrying Value as on 1st April 2015 1.44 0.01 49.88 253.06 1.60 2.28 1.81 310.07

NOtE 4: CAPItAL WORK IN PROgRESS (` In Crores)Particulars As at

31.03.2017As at

31.03.2016As at

01.04.2015Capital work in progress 10.13 6.70 7.69 Total 10.13 6.70 7.69

NOtE 5: INtANgIBLE ASSEtSthe Changes in the carrying value of Intangible Assets for the year ended 31st March 2017 were as follows: (` In Crores)

Particulars Intangible Fixed Assets

product Development

Expenses

Total

Gross Carrying Value as on 1st April 2016 13.87 0.74 14.61 Additions - - - Deletions - - - Gross Carrying Value as on 31st March 2017 13.87 0.74 14.61

Accumulated Depreciation as of 1st April 2016 11.56 - 11.56 Depreciation for the year 1.62 0.15 1.76 Adjustment - - - Accumulated Depreciation as of 31st March 2017 13.18 0.15 13.33 Net Carrying Value as on 31st March 2017 0.69 0.59 1.28 Net Carrying Value as on 31st March 2016 2.31 0.74 3.04


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the Changes in the carrying value of Intangible Assets for the year ended 31st March 2016 were as follows: (` In Crores)


product Development

Expenses

Total

Gross Carrying Value as on 1st April 2015 13.87 0.74 14.61 Additions - - - Deletions - - - Gross Carrying Value as on 31st March 2016 13.87 0.74 14.61

Accumulated Depreciation as of 1st April 2015 9.94 - 9.94 Depreciation for the year 1.62 - 1.62 Adjustment - - - Accumulated Depreciation as of 31st March 2016 11.56 - 11.56 Net Carrying Value as on 31st March 2016 2.31 0.74 3.04 Net Carrying Value as on 1st April 2015 3.93 0.74 4.66

NOtE 6: INVEStMENtS

Particulars Face Value

As at 31.03.2017

As at 31.03.2016

As at 01.04.2015

Investments in equity instruments Blue Star Ltd. (31 March 2017: 392) (31 March 2016: 375) (01 April 2015: 375) 2 0.03 0.01 0.01 Castrol (India) Ltd. (31 March 2017: 20) (31 March 2016: 20) (01 April 2015: 20) 5 0.00 0.00 0.00 Chambal Fertilizers & Chem. Ltd. (31 March 2017: 1000) (31 March 2016: 1000) (01 April 2015: 1000)

10 0.01 0.01 0.01

DB International Stock Brokers Ltd (31 March 2017: 13000) (31 March 2016: 13000) (01 April 2015: 13000)

2 0.01 0.03 0.06

Dot Com. Global Ltd. (31 March 2017: 24200) (31 March 2016: 24200) (01 April 2015: 24200)

10 0.00 0.00 0.00

Shardul Securities Ltd. (31 March 2017: 25600) (31 March 2016: 25600) (01 April 2015: 25600)

10 0.11 0.11 0.11

ACE Edutrend Ltd. (31 March 2017: 16900) (31 March 2016: 16900) (01 April 2015: 16900) 10 0.00 0.00 0.00 Dion Global Solutions Ltd. (31 March 2017: 160) (31 March 2016: 160) (01 April 2015: 320)

10 0.00 0.00 0.00

Healthfore Technologies Ltd. (31 March 2017: 80) (31 March 2016: 80) (01 April 2015: 80) 10 0.00 0.00 0.00 Glaxosmithkline Pharmaceuticals Ltd. (31 March 2017: 125) (31 March 2016: 125) (01 April 2015: 125)

10 0.03 0.05 0.04

HDFC Bank Ltd. (31 March 2017: 125) (31 March 2016: 125) (01 April 2015: 125) 2 0.02 0.01 0.01 Hindustan Uniliver Ltd. (31 March 2017: 1350) (31 March 2016: 1350) (01 April 2015: 1350)

1 0.12 0.12 0.12

JSW Steel Ltd. (31 March 2017: 11240) (31 March 2016: 1124) (01 April 2015: 1124) 1 0.21 0.14 0.10 Lumax Industries Ltd. (31 March 2017: 4600) (31 March 2016: 4600) (01 April 2015: 4600) 10 0.63 0.19 0.15 Panasonic Energy India Co. Ltd. (31 March 2017: 500) (31 March 2016: 500) (01 April 2015: 500)

10 0.01 0.01 0.01

Pan India Corporation Ltd. (31 March 2017: 200) (31 March 2016: 200) (01 April 2015:200) 10 0.00 0.00 0.00 Sterlite Technologies Ltd. (31 March 2017: 525) (31 March 2016: 525) (01 April 2015: 525) 2 0.01 0.00 0.00 Subros Ltd. (31 March 2017: 150) (31 March 2016: 150) (01 April 2015: 150) 2 0.00 0.00 0.00 Tata Chemicals Ltd. (31 March 2017: 50) (31 March 2016: 50) (01 April 2015: 50) 10 0.00 0.00 0.00 Tata Consultancy Services Ltd. (31 March 2017: 832) (31 March 2016: 832) (01 April 2015: 832)

1 0.20 0.21 0.21

Visesh Infotecnics Ltd. (31 March 2017: 1100) (31 March 2016: 1100) (01 April 2015: 1100)

1 0.00 0.00 0.00

Voltas Ltd. (31 March 2017: 500) (31 March 2016: 500) (01 April 2015: 500) 1 0.02 0.01 0.01 Contd....



(` In Crores)Particulars Face Value As at

31.03.2017 As at

31.03.2016 As at

01.04.2015

GHCL Ltd. (31 March 2017: 15000) (31 March 2016: 15000) (01 April 2015: 125000) 10 0.40 0.17 0.77

Archies Ltd. (31 March 2017: 50000) (31 March 2016: 50000) (01 April 2015: 50000) 2 0.12 0.10 0.10

Investment in SBI Mutual Fund (31 March 2017: 100000) (31 March 2016: 100000) (01 April 2015: 100000)

0.13 0.09 0.10

2.08 1.29 1.84

Fedders Credits Ltd. (Formerly Lloyd Credits Ltd.) 10 0.30 0.30 0.30

Fedders Aircool Pvt. Ltd. (Formerly Lloyd Aircon Pvt. Ltd.) 10 0.00 0.00 0.00

Carrier Airconditioning & Refrigeration Ltd. (31 March 2017: 400) (31 March 2016: 400) (01 April 2015: 400)

10 0.00 0.00 0.00

0.30 0.30 0.30

Investment in equity instruments

In Subsidiaries

Lloyd Coils Europe s.r.o 45.01 45.01 45.01

Janka Engineering s.r.o 38.66 38.66 38.66

Noske-Kaeser Rail & Vehicle Germany GmbH 3.75 3.43 0.70

Noske-Kaeser Rail & Vehicles New Zealand Ltd. 18.64 17.03 3.49

Noske-Kaeser US Rail & Vehicles LLC - 0.01 -

106.07 104.13 87.86

Total 108.45 105.72 90.00

NOtE 7: LOANS

Particulars As at 31.03.2017

As at 31.03.2016

As at 01.04.2015

Unsecured, considered goodSecurity Deposits 2.80 3.24 2.76 Loans to Subsidiary Companies 4.10 4.36 - Total 6.90 7.59 2.76

NOtE 8: OthER FINANCIAL ASSEtS

Other Bank Balance 0.21 0.23 0.33 Total 0.21 0.23 0.33

NOtE 9: OthER NON-CURRENt ASSEtS

Prepaid expenses - 0.01 0.02 Total - 0.01 0.02

NOtE 10: INVENtORIES

Raw materials 360.99 344.95 202.70 Stock in Progress 22.38 20.96 20.98 Finished Goods 514.57 453.83 448.91 Stock in Transit (At Cost) 94.07 57.16 46.72 Total 992.00 876.91 719.31

NOtE 11: tRADE RECEIVABLES

Trade Receivables -Considered Good 695.31 598.59 458.13 Less : Allowance for Expected Credit Loss on Trade Receivable 1.71 1.44 1.15 Total 693.60 597.14 456.98


101

NOtE 12: CASh BANK BALANCES (` In Crores)


As at 31.03.2016

As at 01.04.2015

Cash and cash equivalents Balance with Banks-Current accounts 89.41 64.99 56.03 Cash in hand 0.24 0.38 0.23 Total 89.64 65.37 56.26

NOtE 13: BANK BALANCES

Unclaimed dividend accounts 0.22 0.27 0.25 Fixed Deposits 0.13 0.13 0.13 Receipt pledged with Bank for margin money (Including Interest) 1.15 0.78 0.78 Total 1.50 1.18 1.16

NOtE 14: LOANSUnsecured, considered good

Security Deposits 1.54 1.54 0.85 Total 1.54 1.54 0.85


Interest accrued on Fixed Deposit with Banks 0.03 0.02 0.04 Loans to Subsidiary Companies 6.02 6.60 - Total 6.04 6.62 0.04

NOtE 16: OthER CURRENt ASSEtS

Advance to Vendor (Group Companies) 46.88 23.59 16.92

Prepaid expenses 24.29 16.39 15.23

Advances for Capital Goods 5.89 5.04 -

Balance with Statutory/ Govt. Authorities 24.02 18.31 14.89

Insurance claim receivable - - 46.54

Non current assets held for sale - - 0.89

Advance recoverable in cash & kind or for value to be recovered 10.17 10.81 3.38

Advances to employees 0.04 0.93 0.55

Total 111.28 75.07 98.41

NOtE 17: EQUItY ShARE CAPItAL

1. Authorized Capital

7,00,00,000 Equity Share of Rs.10 each 70.00 70.00 70.00

(Previous year 7,00,00,000 Equity Share of Rs.10 each)

total Authorized Share Capital 70.00 70.00 70.00

2. Issued & Subscribed Capital

4,03,45,160 Equity Shares of Rs.10 each 40.35 36.22 35.33

(Previous Year 3,62,18,160 equity shares of Rs.10 each)

3. Paid up Capital

4,03,32,260 Equity Shares of Rs.10 each fully paid up 40.33 36.21 35.32


Add:- Equity Shares forfeited (amount originally paid up)

0.01 0.01 0.01

Total 40.34 36.21 35.33

Contd....



NOtES:-

1. Out of the above Equity Shares

a) Includes 40,00,000 Equity Shares alloted in the year 2006-07 upon conversion of warrants issued on preferential basis during the year 2005-06.

b) Includes 92,00,000 underlying Equity Shares representing 46,00,000 Global Depository Receipts issued during the year 2005-06.

c) In the year 2006-07 the Company had forfeited 13,300 equity shares due to the non-payment of allotment money. The Board of Directors had annulled the forfeiture of 400 Equity shares on receipt of payment advice by the shareholders and accordingly 400 Equity Shares had been restored back.

d) 43,20,000 Equity Shares of Rs.10 each were alloted during the financial year 2013-14 in favour of shareholders of Perfect Radiators & Oil Coolers Pvt. Ltd. (PROC) on account of merger of PROC with the Company retrospectively since 01.04.2011.

e) Includes 8,85,000 equity shares alloted to Promoter Group Entities on January 29, 2016, upon conversion of equivalent number of warrants issued on preferential basis.

f) Includes 17,00,000 equity shares alloted to Promoter Group Entities on September 03, 2016 and 24,27,000 equity shares on September 08, 2016, upon conversion of equivalent number of warrants issued on preferential basis.

(a) Reconciliation of the shares outstanding at the beginning and at the end of the reporting period (` In Crores)

Particulars 31 March, 2017 31 March, 2016 1 April, 2015

No. of Shares

Amount No. of Shares


Amount

Equity Shares

Shares outstanding at the beginning of the year 36,205,260 36.21 35,320,260 35.32 35,320,260 35.32

Shares Issued during the year 4,127,000 4.13 885,000 0.89 - -

Shares outstanding at the End of the year 40,332,260 40.33 36,205,260 36.21 35,320,260 35.32

(b) terms/rights attached to equity shares

The Company has only one class of equity shares having par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

(c) Details of shareholders holding more than 5% shares in the Company (` In Crores)

Particulars 31 March, 2017 31 March, 2016 1 April , 2015

No. of Shares

% of holding

No. of Shares

% of holding

No. of Shares

% of holding

Equity Shares of Rs. 10 each fully paid-up

PSL Engineering Pvt. Ltd. 3,713,520 9.21 3,713,520 10.26 3,713,520 10.51

Fedders Sales Pvt. Ltd. (Formerly Lloyd Sales Pvt. Ltd.) 3,315,005 8.22 3,315,005 9.16 3,315,005 9.39

Airserco Pvt. Ltd. 3,304,133 8.20 3,304,133 9.13 3,304,133 9.35

Fedders Manufacturing Pvt. Ltd. (Formerly Lloyd Manufacturing Pvt. Ltd.)

2,253,416 5.59 1,653,416 4.57 1,653,416 4.68

As per the records of the Company, including its register of shareholders/members and other declaration received from the shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownerships of shares.


103

(d) Share Warrants (Pending Allotments) (` In Crores)


As at 31.03.2016

As at 01.04.2015

25% Upfront Payment - 19.44 22.80

Total - 19.44 22.80

Money received against Share Warrants represents amounts received towards warrants which entitles the warrant holders, the option to apply for and be alloted equivalent number of equity shares of the face value of Rs.10 each.

During the year 2014-15, the Company has issued to its Promoter Group Entities 60 Lac Warrants at a price of Rs.152 each entitling them for subscription of equivalent number of Equity Shares of Rs.10 each (including premium of Rs.142 each share) in accordance with Chapter VII of SEBI (Issue of Capital & Disclosure Requirements) Regulations, 2009.

During the previous year, allottees of 8.85 Lac warrants have exercised their right to convert the warrants into equity shares by paying balance 75% of the consideration aggregating Rs.10.09 Crores and consequently 8.85 Lac equity shares were issued to them.

During the financial year, the Company has issued and alloted 17 Lac equity shares of Rs.10 each at a premium of Rs.142 each on September 03, 2016 and 24.27 Lac equity shares of Rs.10 each at a premium of Rs.142 each on September 08, 2016 to promoter group entities on preferential basis upon conversion of equivalent number of warrants.

Further, the promoter group entities have shown their inability to exercise their right to convert the balance 9.88 lacs warrants which are required to be converted into equity shares on or before September 12, 2016 as conversion of such number of warrants would have increased their shareholding beyond the permissible creeping limit of 5% in a financial year as stipulated in Regulation 3(2) of the SEBI (Substantial Acquisition of Shares & Takeovers) Regulations, 2011. Accordingly, 9.88 lacs warrants stand cancelled and the upfront subscription money aggregating to Rs.3.75 Crores received on said warrants at the time of their subscription was forfeited. Consequent upon the above allotments and forfeiture of warrants, there were no pending warrants due for conversion as on March 31, 2017.

NOtE 18: OthER EQUItY (` In Crores)


As at 31.03.2016

As at 01.04.2015

1. Equity Component-Share Warrant - 19.44 22.80 2. Capital Reserve 15.00 11.25 11.25 3. Revaluation Reserve net of tax 0.23 0.23 0.23 4. Securities Premium Account 270.24 211.64 199.07 5. General Reserve 247.72 217.72 202.72 6. Retained Earnings 346.87 297.39 273.59 7. Other Comprehensive Income 0.95 0.60 (0.53)Total 881.01 758.27 709.13

(` In Crores)


As at 31.03.2016

1. Equity Component-Share Warrant - 19.44 2. Capital Reserve 11.25 11.25 Add: Share warrant forfeited 3.75 -

15.00 11.25 3. Revaluation Reserve net of tax 0.23 0.23 (Land Revalued as on 31st March 1993)4. Securities Premium Account 211.64 199.07 Addition Premium Amount from conversion of warrants 58.60 12.57

270.24 211.64 5. general Reserve Opening Balance 217.72 202.72 Add: Transfer from Profit & Loss Account 30.00 15.00

247.72 217.72 Contd....



(` In Crores)Particulars As at

31.03.2017 As at

31.03.2016 6. Retained Earnings Opening Balance 297.39 273.59 Profit for the year 85.14 55.82 Mat Credit Adjustment for Previous Year - (11.09) Sale of Investment through OCI - (0.42) Dividend Paid (including tax on dividend) (5.66) (5.51) Transfer to General Reserve (30.00) (15.00)

346.87 297.39 Other Comprehensive Income:7. Remeasurement of Retirement Benefit (0.44) - 8. Fair Value of Investment Opening Balance 0.60 (0.53) Addition during the year 0.79 0.71 Transfer retained earning on sale - 0.42

0.95 0.60 Total 881.01 758.27

NOtE 19: BORROWINgS


As at 31.03.2016

As at 01.04.2015

Secured

Term Loans(Indian Currency)

From banks 50.95 77.26 89.46

Total 50.95 77.26 89.46

Note:-

1. Indian rupee loan for Rs.35.00 Crores from IDBI Ltd. carries interest @ 12.25% p.a. on Rs.17.50 Crores and @ 11.50% p.a. on Rs.17.50 Crores. The Loan is repayable in 16 quarterly installment of Rs.2.19 crores each after monotorium of 12 Months from the date of loan i.e. 31st March, 2013. The Company has taken disbursement of Rs.31.50 Crores.

2. Indian rupee loan for Rs.120.00 Crores from SBI carriers interest @ 11.00% p.a. The Loan is repayable in 24 quarterly installment of Rs.5.00 crores each after monotorium of 12 Months from the date of loan i.e. 30.06.2013.

3. Indian rupees loan for Rs.20.00 Crores from SBBJ carries interest @ 12% p.a. The Loan is repayable in 16 Quarterly installment of Rs.1.25 Crores each after monotorium of 9 Months from the date of Loan i.e. 01.09.2015.

4. The above loans are secured by way of first charge on Pari-Passu basis on the fixed assets of the Company and second hypothecation charge on the Stock/Book Debts

NOtE 20: LONg tERM PROVISIONS

Gratuity 7.09 2.81 3.08

Total 7.09 2.81 3.08

NOtE 21: DEFERRED tAx LIABILItIES (NEt)

Deferred tax liabilities on account of

Due to depreciation 1.26 3.11 3.34

1.26 3.11 3.34

Deferred tax assets on account of

Provisions for employee benefits 0.61 (0.13) (0.21)

0.61 (0.13) (0.21)

Total 0.65 3.25 3.55


105

NOtE 22: BORROWINgS (` In Crores)


As at 31.03.2016

As at 01.04.2015

Secured

Working Capital from Banks 1,025.08 898.31 703.11

Total 1,025.08 898.31 703.11

The working capital loans, fund based as well as non-fund based are secured by way of first hypothecation charge on the stocks/ book debts, both present and future and second charge on pari-passu basis on the fixed assets of the Company. This includes working capital loan in the form of Cash Credit Limit, Working Capital Demand Loan, Bill Discounted and Buyer’s Credit etc.

NOtE 23: tRADE PAYABLES

Others 133.02 113.15 104.56

Total 133.02 113.15 104.56

NOtE 24: OthER FINANCIAL LIABILItIES

Current maturities of long-term debt;

Foreign Currency Loans - - 4.07

Term Loans 28.28 38.75 28.75

Loan from Subsidiary Companies - 21.97 21.10

Loan Against Vehicles 1.15 1.69 1.24

Interest accrued but not due on Borrowings 0.45 0.61 1.58

Unpaid Dividend 0.31 0.27 0.25

Other Expenses Payables 27.25 25.87 4.54

Derivative Liabilities 1.55 0.28 -

Total 58.99 89.44 61.53

NOtE 25: OthER CURRENt LIABILItIES

Due to Statutory Bodies 50.26 39.34 24.74

Other Liability 66.68 37.80 19.48

Total 116.94 77.13 44.22

NOtE 26: ShORt tERM PROVISIONS

Leave Encashment 1.18 1.02 1.46

Provision for warranty 5.18 5.08 -

Total 6.36 6.10 1.46

NOtE 27: REVENUE FROM OPERAtION

Particulars For the year ended 31 March 2017

For the year ended 31 March 2016

Sale of products

Gross Sale/Income from Operations 3,013.82 2,433.57

Less: Schemes & Discounts - 46.88

3,013.82 2,386.69

Other Operating Revenues

Other Operating Revenues 8.61 0.94

Total 3,022.43 2,387.63



NOtE 28: OthER INCOME (` In Crores)



Interest Income from Subsidiary 0.81 0.18

Dividend Received 0.02 0.05

Interest Income 0.51 0.05

Interest Income on Financial Assets at amortisation cost 0.15 0.10

Gain on Sale on Fixed Assets 0.07 -

Miscellaneous Income 0.42 0.67

Total 1.98 1.05

NOtE 29: COSt OF MAtERIAL CONSUMED

raw Material

Opening stock 344.95 202.70

Purchases 2,174.28 1,788.26

Carriage Inwards 40.53 54.21

2,559.76 2,045.17

Less: Closing stock 360.99 344.95

Total 2,198.77 1,700.22

NOtE 30: PURChASE OF StOCK IN tRADE

Other consumer goods 270.13 142.74 Total 270.13 142.74

NOtE 31: ChANgE IN INVENtORY

Opening stock

Work-in-progress 20.96 20.98

Finished goods 453.83 448.91

474.80 469.89

Closing stock



536.94 474.80

Total (62.14) (4.91)

NOtE 32: EMPLOYEE BENEFIt ExPENSE

Salaries and wages 89.47 66.18

Contribution to Provident and other funds 4.00 3.46

Staff Welfare 3.21 2.51

Total 96.69 72.15

NOtE 33: FINANCE COSt

Interest

Bank Loan 98.99 85.66

Loan to Subsidiary Companies 0.17 0.87

Bank Charges 19.73 18.77

Total 118.89 105.30


107

NOtE 34: DEPRECIAtION AND AMORtIzAtION ExPENSE (` In Crores)



Depreciation on Tangible Assets 34.21 31.58

Amortization of Intangible Assets 1.76 1.62

Total 35.98 33.20

NOtE 35: OthER ExPENSES

Power & Fuel 7.07 6.98

Repairs & Maintenance

- Machinery 4.09 3.98

- Building & Office 0.29 0.39

Insurance 2.08 2.01

Rates & Taxes 11.32 10.39

Travelling & Conveyance 9.54 7.37

Service Contract Charges/ Installations/ Warranty 17.87 11.36

Motor Car Expenses 0.40 0.40

Telephone Expenses 4.89 3.71

Factory Overheads 8.01 9.15

Auditor's Remuneration (including Cost audit fee) 0.23 0.25

Foreign Exchange Fluctuations 4.32 25.87

Donation 1.36 0.34

Octroi & Carriage Outwards 21.38 14.57

Business Promotion 11.71 7.05

Advertising and sales promotion 86.10 51.52

Printing & Stationery 0.71 0.68

Legal & Professional 8.00 4.65

Loss On Sale of Fixed Assets - 0.10

Life time credit risk on Trade Receivables 0.27 0.30

Fair value loss on Financial Assets 0.04 0.12

Miscellaneous Expenses 2.31 1.55

Total 202.00 162.73



NOTES TO ACCOuNTS36. Contingent liability not provided for (` In Crores)


As at 31.03.2016

As at 01.04.2015

A. Claims against the company / disputed liabilities not acknowledged as debts*

a. HP State Electricity Board 0.11 0.11 0.11

b. Central Excise & Customs Matters* 3.31 3.53 0.22

c. Sale Tax Matters Nil Nil 0.84

d. Income Tax Matters (Pending Rectifications) 2.95 3.50 Nil

B. Guarantees

i) Bank Guarantees 24.56 8.59 5.95

ii) Stand by Line of Credit of Euro 3.785 million from IndusInd Bank Limited given by the Company for Euro 4.00 million Term Loan facilities availed by Lloyd Coils Europe s.r.o. a wholly owned subsidiary from SBI Paris (Euro 2.89 million as at March 31, 2015.)

NIL NIL 19.51

iii) Stand by Line of Credit of Euro 1.25 Million from Standard Chartered Bank given by the company for Euro 1 million working capital facilities availed by Janka Engineering s.r.o. a wholly owned subsidiary from Komercni Bank Czech Republic. (Euro 1.25 million as at March 31, 2015.)

NIL NIL 8.44

iv) Corporate Guarantee of Euro 3 Million issued by the Company in favour of GE Money Bank, a.s. for credit facility availed by Lloyd Coils Europe s.r.o.

NIL 20.25 20.25

v) Unconditional and irrevocable Corporate Guarantee of AUD 6 Million in favour M/s Bombardier Transportation (v/Line) Australia Pty Ltd. (“Bombardier”). This guarantee is issued as a security for the performance of the agreement executed by Noske Kaeser Rail & Vehicles New Zealand Limited (WOS) with the Bombardier for the manufacture and supply of equipments by the WOS.

29.72 NIL NIL

vi) Unconditional and irrevocable Performance Guarantee of NZD 3.8 million in favour of M/s Downer EDI Rail Pty Limited (“Downer). This guarantee is issued as a security for the performance of the agreement executed by Noske Kaeser Rail & Vehicles New Zealand Limited (WOS) with the Downer for the supply of air conditioner equipment and services by the WOS.

17.25 NIL NIL

*During the previous financial year the Company has received total demand of Rs.46.23 Cr. under show cause notices from custom department. The Company has made suitable reply of the same. Since there is no confirm demand, hence no provision is required.

37.

Contracts remaining to be executedOn capital account and not provided for

NIL NIL NIL

38. Micro and Small Scale Business Entities This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been

determined to the extent such parties have been identified on the basis of information available with the Company. Accordingly, there were no interest due on the principal amount, not there was necessity to pay interest for delayed payment in terms of section 16 of the Micro, Small and Medium Enterprises Development Act.


109

39. Disclosure as per regulation 34 (3) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

a) Loan given to Subsidiary and outstanding (` In Crores)

Name of the Company Relationship Amount Outstanding as on 31.03.2017

Amount Outstanding as on 31.03.2016


Lloyd Coils Europe s.r.o. Czech Republic Subsidiary 6.02 7.72 NilNoske-Kaeser Rail & Vehicles, Germany GmbH Subsidiary 4.09 3.06 Nil

b) Loan taken from Subsidiary and payable




Lloyd Coils Europe s.r.o. Subsidiary NIL 20.99 20.99

40. Related Party Disclosures: (in which some Directors are interested)

A. Names of related parties and related party relationships

i. Wholly Owned Subsidiaries:

a. Lloyd Coils Europe s.r.o. Czech Republic. b. Janka Engineering s.r.o. Czech Republic. c. Noske Kaeser Rail & Vehicle Germany GmbH. d. Noske Kaeser US Rail & Vehicle LLC. e. Noske Kaeser Rail & Vehicles New Zealand Limited (“NK NZ”). f. Noske-Kaeser Rail & Vehicle Australia Pty Ltd (Indirect Wholly owned subsidiary through NK NZ). g. Noske-Kaeser Empreendimentos e Participaçôes do Brasil Ltd. (Indirect Wholly owned subsidiary through NK NZ).

ii. List of Key management personnel:

a. Mr. Brij Raj Punj Chairman and Managing Director b. Mr. Bharat Raj Punj Deputy Managing Director c. Mr. Achin Kumar Roy Whole Time Director d. Mr. Mukat B. Sharma Whole Time Director and Chief Financial Officer e. Mr. Nipun Singhal Whole Time Director (Resigned w.e.f. 8th May, 2017)

iii. Enterprises owned or significantly influenced by key management personnel or their relatives:

a. Fedders Electric & Engineering Ltd. (Formerly Fedders Lloyd Corporation Ltd.) b. Fedders Lloyd Trading FZE c. Airserco Pvt. Ltd. d. Perfect Radiators & Oil Coolers Pvt. Ltd. e. PSL Engineering Pvt. Ltd. f. Regal Information Technology Pvt. Ltd. g. Fedders Aircool Pvt. Ltd. (Formerly Lloyd Aircon Pvt. Ltd.) h. Fedders Credits Ltd. (Formerly Lloyd Credits Ltd.) i. Fedders IT Technology Pvt. Ltd. (Formerly Lloyd IT Technology Pvt. Ltd.). j. Fedders Sales Pvt. Ltd. (Formerly Lloyd Sales Pvt. Ltd.) k. Fedders Manufacturing Pvt. Ltd. (Formerly Lloyd Manufacturing Pvt. Ltd.) l. Fedders Infotech (India) Pvt. Ltd. (Formerly Lloyd Infotech (India) Pvt. Ltd.) m. Fedders Stock & Investments Pvt. Ltd. (Formerly Lloyd Stock & Investments Pvt. Ltd.) n. Himalayan Mineral Waters Pvt. Ltd. o. Punj Engineering Pvt. Ltd. p. Punj Services Pvt. Ltd. q. Pandit Kanahaya Lal Punj Pvt. Ltd. r. PSL Wolfe JV Pvt. Ltd. s. Pandit Kanahaya Lal Punj Trust t. Brij Raj Punj(HUF)



B. transactions during the period with Related Parties are as under:(` In Crores)

Name of Related Party 2016-17 2015-16

Fedders Electric & Engineering Ltd. (Formerly Fedders Lloyd Corporation Ltd.)Sales of Goods 11.66 10.61Purchase of Goods 57.40 39.76Security Deposit 26.42 16.92Fedders Infotech (India) Pvt. Ltd. (Formerly Lloyd Infotech (India) Pvt. Ltd.)Services Received 39.64 14.01 Fedders Manufacturing Pvt. Ltd. (Formerly Lloyd Manufacturing Pvt. Ltd.)Money received against Share Warrants 6.84 NILPerfect Radiators and Oil Coolers Pvt. Ltd.Money received against Share Warrants 4.56 2.00Rent Paid 1.09 NilSecurity Deposit 8.08 NilPandit Kanahaya Lal Punj Pvt. Ltd.Money received against Share Warrants 10.98 3.99Rent Paid 0.53 0.47Security Deposit 5.36 3.36himalayan Mineral Waters Pvt. Ltd.Money received against Share Warrants 13.26 1.82Security Deposit 3.06 1.56Fedders Stock & Investment Pvt. Ltd. (Formerly Lloyd Stock & Investment Pvt. Ltd.)Money received against Share Warrants 6.84 NILFedders Credits Ltd. (Formerly Lloyd Credits Ltd.)Money received against Share Warrants 4.56 2.28Pandit Kanahaya Lal Punj trustDonation 1.36 0.34Fedders Aircool Pvt. Ltd. (Formerly Lloyd Aircon Pvt. Ltd)Security Deposits 3.95 1.75Subsidiary CompaniesLloyd Coils Europe s.r.o.Purchase of Goods 1.15 0.06Interest paid on Loan taken 0.17 0.87Loan given during the year NIL 7.72Interest Receivables on Loan given 0.53 0.18Janka Engineering s.r.o.Purchase of Goods 0.16 0.01Sale of Goods NIL 0.05Exhibition Expenses NIL NILOthers NIL NILNoske-Kaeser Rail & Vehicle germany gmbhLoan given during the year 1.04 3.06Interest Receivables on Loan given 0.28 0.00Noske Kaeser Rail & Vehicles New zealand LimitedPurchase of Goods 0.92 0.00Key Management PersonnelManagerial Remuneration Paid-Mr. Brij Raj Punj 0.78 0.72-Mr. Bharat Raj Punj 0.63 0.58-Mr. Achin Kumar Roy 1.66 1.10-Mr. Mukat B. Sharma 0.49 0.45-Mr. Nipun Singhal 1.05 1.04


111

41. Additional Information

Basic & Diluted Earnings per Share: Earnings per share have been computed as under:(` In Crores)

Particulars 2016-17 2015-16Profit after Taxation 85.49 56.53Number of Equity Shares 40,332,260 36,205,260Basic Earnings Per Share (Face Value Rs.10 per share)

21.19 15.61

Diluted Earnings Per Share (Face Value Rs.10 per Share)

21.19 13.68*

*Assuming full conversion of remaining 51,15,000 convertible warrants issued on 13.03.2015 on preferential basis as per SEBI (ICDR) Regulations, 2009

42. Remuneration to Auditors(` In Crores)

Particulars 2016-17 2015-16Audit fees 0.15 0.15Tax Audit 0.03 0.03Service Tax (including SBC & KKC) 0.03 0.03Total 0.21 0.21

43. Segment Information

A. Primary Segment Reporting (Business Segment)

During the year the Company had following Business segments as its primary reportable segments

a. Consumer Durables (please refer note 49)

b. OEM & Packaged Air-conditioning

c. Heat Exchangers & Components

Segment Revenues, Results and Other Information: (` In Crores)

Particulars 2016-17 2015-16I. Segment Revenue

i. Consumer Durables 1,885.46 1,337.19ii. OEM & Packaged Air-conditioning 936.01 879.78iii. Heat Exchangers & Components 603.93 611.01

Sub:- total (i+ii+iii) 3,425.40 2,827.98Less:- Inter Segment Revenue 411.58 441.29Net Sales/Income from Operations 3,013.82 2,386.69II. Segment Results

(PROFIT (+)/LOSS(-))i. Consumer Durables 120.94 105.65ii. OEM & Packaged Air-conditioning 59.74 50.15iii. Heat Exchangers & Components 66.09 81.77

Sub:- total (i+ii+iii) 246.77 237.57Less:- i. Finance Cost 118.89 105.30

ii. Other un-allocable expenditure net of un-allocable Income 8.91 7.00iii. Exceptional Items - 45.80

Operating Profit before tax 118.97 79.47III. Segment Assets* - -IV. Segment Liabilities* - -

*As certain assets of the Company including manufacturing facilities are often deployed interchangeably across segments, it is impractical to allocate these assets and liabilities segment wise.



B. Information pertaining to geographical Segment:

Sale of products(` In Crores)

Particulars 2016-17 2015-16Within India 2903.22 2,296.18Outside India 110.60 90.51Total 3013.82 2,386.69

Fixed Assets as per geographical Locations

The Company has common fixed assets, other assets and liabilities for domestic as well as overseas market. Hence, separate figures for assets and liabilities have not been furnished.

44. Employee Benefit Expenses

Disclosure figures of the gratuity liability of the employees, in accordance with IND AS 19. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method.

Present Benefit Obligation-As per Actuarial Valuation

Particulars 31.03.2017 31.03.2016Present Value of obligation as at the beginning of the period 4.78 4.16Interest Cost 0.38 0.33Service Cost 1.56 1.25Benefit Paid (0.31) - Total Actuarial Gain/Loss on Obligation 0.67 (0.96)Present Value of obligation as at the end of the period 7.08 4.78

Fair value of Plan Assets

Particulars 31.03.2017 31.03.2016Fair value of plan assets at the beginning of the period -- --Actual return on plan assets -- --Employer contribution -- --Benefits paid -- --Fair value of plan assets at the end of the period -- --

the Amount recognized in the Income Statement

Particulars 31.03.2017 31.03.2016Interest Cost 0.38 0.33 Service Cost 1.56 1.24Expenses recognized in the Income Statement 1.94 1.57

Net Liability recognized in the Balance Sheet

Particulars 31.03.2017 31.03.2016Present Value of obligation at the end 7.08 4.78Fair Value of Plant Assets - - Unfunded Liability /Provision in Balance Sheet (7.08) (4.78)Unfunded Liability recognized in the Balance Sheet (7.08) (4.78)

Remeasurement (gain)/ loss recognized in other comprehensive income

Particulars 31.03.2017 31.03.2016Actuarial (Gain)/Loss on arising from Change in Demographic Assumption - -Actuarial (Gain)/Loss on arising from Change in Financial Assumption 0.55 (0.08)Actuarial (Gain)/Loss on arising from Experience Adjustment 0.13 (0.87)Total 0.68 (0.95)


113

Principal assumptions used in determining defined benefit obligation.(` In Crores)

Particulars 31.03.2017 31.03.2016

i) Discounting Rate 7.50 8.00

ii) Future salary Increase 10.00 10.00

iii) Retirement Age (years) 60 60

iv) Mortality rates inclusive of provision for disability 100% of IALM (2006 - 08)

v) Ages Withdrawal Rate (%) Withdrawal Rate (%)

Up to 30 Years 3 3

From 31 to 44 years 2 2

Above 44 years 1 1

Sensitivity Analysis of the defined benefit obligation

a) Impact of the change in discount ratePresent Value of Obligation at the end of the period 7.09 Impact due to increase of 0.50% (0.5)Impact due to decrease of 0.50 % 0.55 b) Impact of the change in salary increase Present Value of Obligation at the end of the period 7.09 a) Impact due to increase of 0.50% 0.54 b) Impact due to decrease of 0.50 % (0.49)

45. Capital Management

For the purposes of Company’s capital management, Capital includes equity attributable to the equity holders of the Company and all other equity reserves. The Company manages its capital to ensure that the company will be able to continue as going concerns while maximizing the return to stakeholders through the optimization of the debt and equity balance. The capital structure of the Company consists of net debt (borrowings offset by cash and bank balances) and total equity of the company. The Company reviews the capital structure of the Company on a semi-annual basis. As part of this review, the company considers the cost of capital and the risks associated with each class of capital. The Company monitors capital using gearing ratio, which is net debt divided by total capital plus net debt.


As at 31.03.2016

As at 01.04.2015

Debt 1,105.45 1,037.98 847.72

Cash and bank balances 89.64 65.37 56.26

Net debt 1,015.81 972.61 791.46

Total equity 921.35 794.48 744.46

Equity and net debt 1,937.16 1,767.09 1,535.92

gearing ratio (Net Debt/Capital and Net Debt) 52.44% 55.04% 51.53%

46. Financial Instrumentsa) Financial instruments by category

Measured at amortized cost

a) cash and cash equivalent including bank balance 91.14 66.54 57.42

b) Loan 8.44 9.14 3.60

c) Other financial assets 6.25 6.86 0.37

d) Trade receivable 693.60 597.14 456.98

Fair value through Other Compressive Income

Investment in equity Instrument 2.38 1.59 2.14 Contd....



(` In Crores)


As at 31.03.2016

As at 01.04.2015

Investment in Subsidiary at cost as per IND AS 27

Investment in Subsidiaries 106.07 104.13 87.86

Total 907.88 785.40 608.37

Financial liabilities


a) Borrowing 80.38 139.67 144.61

b) Short term borrowing 1,025.08 898.31 703.11

b) Trade payable 133.02 113.15 104.56

c) Other financial liability 28.01 26.75 6.37

Sub total 1,266.49 1,177.88 958.65

Fair value through profit and loss

Forward contracts 1.55 0.28 -

Total 1,268.04 1,178.16 958.65

b) Fair value measurement of financial assets and financial liabilities (` In Crores)

Particulars Fair value as at Fair value hierarchy

Valuation technique(s) and key input(s)

As at 31.03.2017

As at 31.03.2016

As at 01.04.2015

Financial Assets

Security deposit 2.80 3.24 2.76 Level 2 Discounted cash flow at a discount rate that reflects the company's current borrowings rate at the end of reporting period.

Investment in equity

2.38 1.59 2.14 Level 1 Based on quoted market price in active markets.

Financial Liabilities

Borrowing 80.38 139.67 144.61 Level 2 Discounted estimated cash flow through the expected life of the borrowings.

Forwards contracts

1.55 0.28 - Level 1 Based on quoted price for similar assets and liabilities in active markets.

c) the fair values of current debtors, bank balances, current creditors and current borrowings are assumed to approximate their carrying amounts due to the short-term maturities of these assets and liabilities. (` In Crores)

Particulars Carrying value

As at 31.03.2017

As at 31.03.2016

As at 01.04.2015

i) Financial assets - Current

Trade receivables 693.60 597.14 456.98

Cash and Bank balances 91.14 66.54 57.42

Loans 1.54 1.54 0.85

Other Financial assets 6.04 6.62 0.04

ii) Financial liabilities - Current

Trade payables 133.02 113.15 104.56

Other Financial liabilities (other than current maturity of long term borrowings)

29.56 27.03 6.37


115

47. Financial risk management objectives and policies

The Company’s principal financial liabilities, other than derivatives, comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include loans, trade and other receivables and cash and cash equivalents that are derived directly from its operations.

The Company’s financial risk management is an integral part of how to plan and execute its business strategies. The Company is exposed to market risk, credit risk and liquidity risk. The company’s focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.

The Board of Directors reviews and agrees policies for managing each of these risks which are summarized as below

a) Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency rate risk, interest rate risk and other price risks, such as equity price risk and commodity price risk.

i) Currency rate risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the Company’s operating activities (when revenue or expense is denominated in foreign currency). The Company holds derivative financial instruments such as foreign exchange forward and option contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The exchange rate between the rupee and foreign currencies has changed substantially in recent years and may fluctuate substantially in the future. Consequently, the results of the Company’s operations are adversely affected as the rupee appreciates/ depreciates against these currencies

Derivative financial instruments

The Company holds derivative financial instruments such as foreign currency forward and option contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The counter party for these contracts is generally a bank or a financial institution. These derivative financial instruments are valued based on quoted prices for similar assets and liabilities in active markets or inputs that are directly or indirectly observable in the marketplace.

Nominal amount of derivative contracts entered into by the Company and outstanding as on 31st March, 2017 is Rs.72.37 Crores (Previous year Rs.7.58 Crores. Category wise breakup is given below:

(` In Crores)

S. No. Particulars As at 31.03.2017

As at 31.03.2016

1. Forward Contract 72.37 7.582. Currency Swap NIL NIL3. Interest Rate Swap NIL NIL4 Option NIL NIL

ii) Interest rate risk

Interest rate is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s long term debt obligation at floating interest rates. The Company’s borrowings outstanding as at March 31, 2017 comprise of fixed rate loans and accordingly, are not expose to risk of fluctuation in market interest rate.



iii) Commodity price risk

The Company is affected by the price volatility of certain commodities. Its operating activities require the ongoing manufacture of industrial and domestic air conditioners and therefore require a continuous supply of copper and Aluminium being the major input used in the manufacturing. Due to the significantly increased volatility of the price of the Copper and aluminium, the Company has entered into various purchase contracts for these material for which there is an active market The Company’s Board of Directors has developed and enacted a risk management strategy regarding commodity price risk and its mitigation. The Company partly mitigated the risk of price volatility by entering into the contract for the purchase of these material based on average price of for each month.

b) Credit Risk

Credit Risk is the risk that the counter party will not meet its obligation under a financial instrument or customer contract, leading to a financial loss. The maximum exposure to the credit risk at the reporting date is primarily from trade receivables. Trade receivables are typically unsecured and are derived from revenue earned from customers.

Customer credit risk is managed subject to the Company’s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on an extensive credit rating score card and individual credit limits are defined in accordance with this assessment.

trade receivables may be analyzed as follows: (` In Crores)

Age of receivables As at 31.03.2017

As at 31.03.2016

As at 01.04.2015

0-90 days past due 512.19 364.05 331.69

90-180 days past due 174.92 227.47 121.03

More than 180 days past due 8.20 7.06 5.41

Sub Total 695.31 598.58 458.13

Less: Allowance for expected Credit Loss on Trade Receivable 1.71 1.44 1.15

Total 693.60 597.14 456.98

An impairment analysis is performed at each reporting date on trade receivables by lifetime expected credit loss method based on provision matrix.

Movement in the expected credit loss allowance As at 31.03.2017

As at 31.03.2016

Balance at beginning of the year 1.44 1.15

Movement in expected credit loss allowance on trade receivables calculated at lifetime expected credit losses

0.27 (0.87)

Balance at end of the year 1.71 1.44

c) Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time. The Company’s objective is to at all times maintain optimum levels of liquidity to meet its cash and liquidity requirements. The Company closely monitors its liquidity position and deploys a robust cash management system. It maintains adequate source of financing through the use of short term bank deposits and cash credit facility. Processes and policies related to such risks are overseen by senior management. Management monitors the Company’s liquidity position through rolling forecasts on the basis of expected cash flows. The Company assessed the concentration of risk with respect to its debt and concluded it to be low.

The following tables detail the Company’s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the company can be required to pay.


117

(` In Crores)

Particulars Weighted average effective interest rate (%)

Within 1 year 1-5 years Total Carrying amount

As at March 31, 2017

Borrowings 11.29% 29.43 51.95 81.38 80.38

Short term borrowings 1,025.08 - 1,025.08 1,025.08

Trade payable 133.02 - 133.02 133.02

Other financial liabilities 29.56 - 29.56 29.56

Total 1,217.09 51.95 1,269.04 1,268.04




Borrowings 11.29% 62.41 78.99 141.40 139.67

Short term borrowings 898.31 - 898.31 898.31

Trade payable 113.15 - 113.15 113.15


Total 1,100.90 78.99 1,179.89 1,178.16



As at 1 April, 2015

Borrowings 11.29% 55.16 91.81 146.97 144.61

Short term borrowings 703.11 - 703.11 703.11

Trade payable 104.56 - 104.56 104.56


Total 869.20 91.81 961.01 958.66

48. During the year, the Company had specified bank notes or other denomination note as defined in the MCA notification G.S.R. 308(E) dated March 31, 2017 on the details of Specified Bank Notes (SBN) held and transacted during the period from November 8, 2016 to December, 30 2016, the denomination wise SBNs and other notes as per the notification is given below.

(` In Crores)

Particulars SBNs ODNs Total

Closing cash on hand as on 08 Nov 2016 0.29 0.24 0.53

(+) Permitted receipts - 0.26 0.26

(-) Permitted payments - 0.26 0.26

(-) Amounts Deposited in Banks 0.29 0.00 0.29

Closing cash on hand as on 30 Dec 2016 0.00 0.24 0.24

49. Events occurring after balance sheet date

The Company has sold its Consumer Durable Business comprising of business of importing, trading, marketing, exporting, distribution, sale of air conditioners, televisions, washing machines and other household appliances and assembling of televisions under the brand “LLOYD” and all of the rights, title, interest and assets, licenses, continuing employees of the said business, intellectual property including the brand, logo, trade mark “LLOYD” as a going concern on slump sale basis to Havells India Ltd. on May 08, 2017 at an enterprise value of Rs.1,550 Crores on a debt free cash free basis.

With effect from the closing date all assets/interest/rights etc. including continuing employees of the consumer durable business got transferred to Havells India Ltd. pursuant to the agreement entered with it.



The sale of the consumer durable business will not have any impact on the Company’s existing B2B air conditioning business as the Company has not sold any of its manufacturing facility as the part of the aforesaid transaction and the Company shall continue with its existing business of manufacturing of air conditioners as OEM suppliers for other brands, packaged air conditioning for railways and heat exchanger business, which are its core competencies.


50. Dividend Paid and Proposed (` In Crores)

Particulars 31.03.17 31.03.16Dividend declared and paid during the year:Final Dividend paid 4.71 4.59Corporate Dividend Tax on Final Dividend 0.96 0.92

5.67 5.51Proposed Dividends on equity shares:Special dividend (One time dividend) 80.66 0.00Corporate Dividend Tax on Special dividend 16.42 0.00Final Dividend for the year ended March 31, 2017 6.05 4.71Corporate Dividend Tax on Proposed Dividend 1.23 0.96

104.36 5.67

51. Income Tax

a) Income tax Expense in the Statement of Profit and Loss Comprises

Particulars 31.03.17 31.03.16Current Income Tax Charge 36.20 17.00 Mat Credit Adjustment - 6.94 Deferred Tax Relating to origination and reversal of temporary differences (2.37) (0.30)Income tax Expense reported in the statement of profit & loss 33.83 23.65

Other Comprehensive IncomeRe-measurement (gains)/losses on defined benefit plan 0.23 - Income tax related to items recognized in OCI during the year 0.23 - Reconciliation of tax expense and the accounting profit multiplied by India's domestic tax rate:Accounting Profit before tax 118.97 79.47 Applicable tax rate 34.608% 34.608%Computed tax Expense 41.17 27.50 Income not considered for tax purpose (18.90) (14.11)Expense not allowed for tax purpose 11.56 10.25 Income tax charged to Statement of Profit and Loss 33.83 23.65

b) Deferred tax (` In Crores)

Particulars 01-Apr-15 Recognized in Profit or loss

Recognized in other

comprehensive income

31-Mar-16

Deferred tax (liabilities)/assets in relation to:Due to Depreciation (3.22) 0.23 - (2.99)Allowance for doubtful debts 0.40 0.10 - 0.50 Financial assets and liabilities (0.61) 0.33 - (0.28)Land Revaluation (0.12) - - (0.12)Others - (0.36) - (0.36)Total (3.55) 0.30 - (3.25)


119

(` In Crores)

Particulars 31-Mar-16 Recognized in Profit or loss

Recognized in other

comprehensive income

31-Mar-17

Deferred tax (liabilities)/assets in relation to:Due to depreciation (2.99) 1.00 - (1.99)Gratuity & other provision - 0.63 0.23 0.85Allowance for doubtful debts 0.50 0.09 - 0.59 Financial assets and liabilities (0.28) 0.65 - 0.37 Land Revaluation (0.12) - - (0.12)Others (0.36) - - (0.36)Total (3.25) 2.37 0.23 (0.65)

52. Disclosures as required by Indian Accounting Standard (IND AS 101) first time adoption of Indian Accounting Standard:

These are Company’s first financial statements prepared in accordance with IND AS. The accounting policies set out in Note 2 have been applied in preparing the financial statements for the year ended 31st March, 2017, the comparative information presented in these financial statements for the year ended 31st March, 2016 and in the preparation of an opening Ind As balance sheet as at 1st April, 2015 (the Company’s date of transition). In preparing its opening IND AS balance sheet, the company has adjusted the amounts reported previously in financial statements prepared in accordance with accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (Indian GAAP). An explanation of how the transition from previous GAAP to IND AS has affected the financial position & financial statements is set out in following notes.

A) Reconciliations of Balance Sheet as at March 31, 2016 and April 01, 2015(` In Crores)

Particulars ref As at 31.03.2016 As at 01.04.2015

Previous gAAP

gAAP Adjustments

As per IND AS

Previous gAAP

gAAPAdjustments

As per IND AS

ASSETS

Non-Current assets

Property, Plant and Equipment j 320.28 - 320.28 310.96 (0.89) 310.07

Capital Work in Progress 6.70 - 6.70 7.69 - 7.69

Intangible Assets 3.04 - 3.04 4.66 - 4.66

Financial Assets

(i) Investments c,g 104.10 1.63 105.72 90.00 (0.01) 90.00

(ii) Loans b 8.25 (0.66) 7.59 3.39 ( 0.64) 2.76

(iii) Other Financial assets 0.23 - 0.23 0.33 - 0.33

Other Non-Current Assets b - 0.01 0.01 - 0.02 0.02

442.61 0.98 443.59 417.04 (1.52) 415.52

Current Assets

Inventories 876.91 - 876.91 719.31 - 719.31

Financial Assets

(i) Trade Receivables d 598.59 (1.44) 597.14 458.13 (1.15) 456.98

(ii) Cash and Cash equivalents 65.37 - 65.37 56.26 - 56.26

(iii) Bank balance other than (ii) above 1.18 - 1.18 1.16 - 1.16

(iv) Loans 1.54 - 1.54 0.85 - 0.85

(v) Other Financial assets 6.62 - 6.62 0.04 - 0.04

Current Tax assets (Net) - - - 6.90 - 6.90 Contd....



(` In Crores)

Particulars ref As at 31.03.2016 As at 01.04.2015

Previous gAAP

gAAP Adjustments

As per IND AS

Previous gAAP

gAAPAdjustments

As per IND AS

Other Current Assets j,b 75.06 0.01 75.07 97.50 0.91 98.41

1,625.26 (1.43) 1,623.83 1,340.14 (0.24) 339.90

TOTAL 2,067.88 (0.46) 2,067.42 1,757.18 (1.76) 1,755.42

EQUItY AND LIABILItIES

Equity

Equity Share Capital 36.21 - 36.21 35.33 - 35.33

Other Equity 751.87 6.40 758.27 703.36 5.77 709.13

788.08 6.40 794.48 738.68 5.77 744.46

Non-Current Liabilities


Borrowings a 78.99 (1.73) 77.26 91.81 (2.35) 89.46

Provisions 2.81 - 2.81 3.08 - 3.08

Deferred Tax Liabilities h,i 2.99 0.26 3.25 3.22 0.33 3.55

84.79 (1.47) 83.31 98.11 (2.03) 96.09

Current Liabilities


(i) Borrowings 898.31 - 898.31 703.11 - 703.11

(ii) Trade payables 113.15 - 113.15 104.56 - 104.56

(iii) Other Financial Liabilities f 89.16 0.28 89.44 61.53 - 61.53

Other Current Liabilities 77.13 - 77.13 44.22 - 44.22

Short Term Provisions e 11.77 (5.66) 6.10 6.97 (5.51) 1.46

Current Tax Liabilities (Net) 5.49 - 5.49 - - -

1,195.01 (5.38) 1,189.63 920.39 (5.51) 914.88

TOTAL 2,067.88 (0.46) 2,067.42 1,757.18 (1.76) 1,755.42

Note: The previous GAAP figures have been reclassified to conform to IND AS presentation requirements for the purposes

B) Reconciliation of total Comprehensive Income for the year ended 31st March 2016(` In Crores)

Particulars ref Indian gAAP gAAP Adjustments

As per IND AS

Revenue from operations k,l 2,382.53 5.10 2,387.63

Other income b 0.95 0.10 1.05

Total Income 2,383.48 5.20 2,388.68

Expenses:

Cost of materials consumed 1,700.22 - 1,700.22

Purchases of stock-in-trade 142.74 - 142.74

Changes in inventories of finished goods work-in-progress and Stock-in-Trade

(4.91) - (4.91)

Excise duty on Sale k - 51.98 51.98

Employee benefits expense 72.15 - 72.15

Finance costs a 104.67 0.62 105.30

Depreciation and amortization Expense g 34.22 (1.03) 33.20

Other expenses b,c,d,f,l 208.79 (46.06) 162.73

Total expenses 2,257.89 5.51 2,263.41 Contd....


121

Particulars ref Indian gAAP gAAP Adjustments

As per IND AS

Profit before exceptional items and tax 125.59 (0.31) 125.27 Exceptional items: Insurance Claims Written Off 45.80 - 45.80 Profit before tax 79.78 (0.31) 79.47 Tax expense: (1) Current tax 17.00 - 17.00 (2) Deferred tax i (0.23) (0.07) (0.30)(3) MAT Credit Entitlement 6.94 - 6.94 Profit (Loss) for the period 56.06 (0.24) 55.82 Other Comprehensive Income Items that will not be reclassified to profit or loss Fair value of Investment c - 0.71 0.71 total Comprehensive Income for the period 56.06 0.47 56.53

Note: The previous GAAP figures have been reclassified to conform to IND AS presentation requirements for the purposes of this note.

C. Reconciliation of equity as at 31st March 2016 and 1st April 2015 between previous gAAP and IND AS: (` In Crores)

Particulars ref As at 31.03.2016

As at 01.04.2015

total equity reported under Previous gAAP 788.08 738.68 Loan recognized at amortized cost using effective rate of interest a 1.73 2.35 Fair value of financial assets at amortized cost b (0.64) (0.61)Fair value of investment through OCI c 0.60 (0.01)Expected credit loss on trade receivables d (1.44) (1.15)Reversal of proposed dividend and recognition in the year of declaration and payment e 5.66 5.51 MTM of forward contract f (0.28) - Other adjustments g 1.03 - Deferred tax liability on land revaluation h (0.12) (0.12)Impact of deferred tax on IND AS impact i (0.13) (0.21)Net IND AS adjustments 6.40 5.77 total Equity under IND AS 794.48 744.46

Notes to the reconciliation of Balance Sheet as at 1st April 2015 and 31st March 2016 and the total comprehensive income for the year ended 31st March 2016:

a) Loan recognized at amortized cost using effective rate of interest

Under the previous GAAP, transaction costs incurred in connection with borrowings are amortized upfront and charged to profit or loss for the period. Under IND AS, transaction costs are included in the initial recognition amount of financial liability and charged to profit or loss using the effective interest method.

b) Fair value of financial assets at amortized cost

i) Security deposits (Refundable on completion of lease term)

Under the previous GAAP, interest free security deposits (that are refundable in cash on completion of lease term) are recorded at their transaction value. Under IND AS all financial assets are required to be recognized at fair value. Accordingly the Company has fair valued the security deposit retrospectively. Difference between the transaction value and fair value is recognized as prepaid rent as on the date of transition and thereafter recognized at amortized cost.

ii) Interest free retention money (Refundable on completion contract)

Under the previous GAAP, interest free retention money (that are refundable in cash on completion of lease term) are recorded at their transaction value. Under IND AS all financial assets are required to be recognized at fair value. Accordingly the Company has fair valued the retention money. Difference between the transaction value and fair value is recognized in retained earnings as on the date of transition and thereafter recognized at amortized cost.

c) Fair value of investment through OCI

Under the previous GAAP, investments are recorded at their transaction value. Under IND AS all investment are required to be recognized at fair value. Accordingly the company has fair valued the investment at each balance sheet date based on quoted market price in active market. Difference between the transaction value and fair value is recognized in other comprehensive income.



d) Expected credit loss on trade receivables

Under the previous GAAP, allowances on trade receivables are required to be recognized based on actual doubtful debt. Under IND AS, life time expected credit losses are required to be recognized based on its historically observed default rates over the expected life of trade receivable.

e) Reversal of proposed dividend and recognition in the year of declaration and payment

Under the previous GAAP, proposed dividend including corporate dividend tax (CDT), are recognized as liability in the period to which they relate, irrespective of when they are declared. Under IND AS, proposed dividend is recognized as liability in the period in which it is declared by the Company, usually when approved by the shareholders in a general meeting, or paid.

f) MtM of forward contract

Under IND AS, Any gains or losses arising from changes in the fair value of derivatives are recognized directly in profit or loss and corresponding assets and liabilities have been recognized.

g) Other adjustments

Under IND AS, transaction costs incurred are included in the initial recognition amount of Investment.

h) Deferred tax liability on land revaluation

Under the previous GAAP, deferred tax is calculated using the income statement approach, Under IND AS, deferred tax are required to be recognized on land revaluation as at 1 April 2015 related to the earlier land revaluations.

i) Deferred tax

Under the previous GAAP, deferred tax is calculated using the income statement approach, which focuses on difference between taxable profits and accounting profits for the period. IND AS 12-“ Income tax” requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base

j) Assets held for sale

Under IND AS 105, “Non-current assets held for sales and discontinued operation” requires assets to be identified as held for sales if carrying amount will be recovered principally through sale transaction rather than continuing use and sale is considered highly probable. Consequently land held for sales have been presented separately from property plant and equipment. There is no impact on total equity and profit as a result of this adjustment.

k) Excise duty

Under the previous GAAP, revenue from sale to goods was presented exclusive of excise duty. Under IND AS revenue from sales of goods is presented inclusive of excise duty. Excise duty paid is presented on face of statement of profit and loss account as a part of expense.

l) Cash discount

Under the previous GAAP, cash discount was presented under other expenses. Under IND AS revenue from sales of goods is recognized at fair value of consideration expected to be received. Accordingly revenue for the year ended March 31, 2016 is presented net of cash discount.

m) Statement of cash Flows

The transition from Indian GAAP to IND AS has not had a material impact on the statement of cash flows.

53. Figures relating to 1st April 2015 (date of transition) and previous year have been regrouped/reclassified wherever necessary to make them comparable with the current year figures.

54. Notes ‘1’ to ‘53’ form an integral part of accounts and are duly authorized.





123

CONSOLIDATED

FINANCIAL

STATEMENTS



INDEpENDENT AuDITOrS’ rEpOrT On Consolidated IND AS Financial Statements

To the Members of LEEL Electricals Limited(Formerly known as Lloyd Electric & Engineering Limited)

Report on the Consolidated Indian Accounting Standards (IND AS) Financial Statements

We have audited the accompanying consolidated IND AS financial statements of LEEL Electricals Limited (Formerly known as Lloyd Electric & Engineering Limited)(“the Holding Company”) and its subsidiaries (collectively referred to as “the Company” or “the Group”), comprising of the consolidated balance sheet as at 31st March 2017, the consolidated statement of profit and loss (including other comprehensive income), the consolidated statement of cash flows and the consolidated statement for changes in equity for the year ended, and a summary of significant accounting policies and other explanatory information (hereinafter referred to as “the consolidated IND AS financial statements”).

Management’s Responsibility for the Consolidated IND AS Financial Statements

The Holding Company’s Board of Directors is responsible for the preparation of the consolidated IND AS 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 including other comprehensive income, consolidated cash flows and consolidated changes in equity 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 the Companies (Accounts) Rules, 2014 and the Companies (Indian Accounting Standard) Rules, 2015, as amended. The respective Board of Directors of the companies included in the Group are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; the selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the 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 consolidated IND AS 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 IND AS financial statements by the Directors of the Holding Company, as aforesaid.

Auditor’s Responsibility

Our responsibility is to express an opinion on the consolidated IND AS 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 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 consolidated IND AS 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 IND AS financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated IND AS 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 IND AS 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 IND AS financial statements.

We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the consolidated IND AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid consolidated IND AS 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 including the IND AS, of the consolidated financial position of the Company, as at 31st March 2017, and their consolidated financial performance including other comprehensive income, their consolidated cash flows and the consolidated changes in equity for the year ended then ended.

Emphasis of Matter

We draw attention to the emphasis of matter as stated in Standalone Auditors’ Report of even dated.


125

Other Matters

We did not audit the financial statements of subsidiary companies namely Lloyd Coils Europe s.r.o. Czech Republic, Janka Engineering s.r.o. Czech Republic, Noske Kaeser Rail & Vehicle Germany GmbH, Noske Kaeser Rail & Vehicles New Zealand Limited (it includes financials of its two step down subsidiaries viz; Noske-Kaeser Rail & Vehicle Australia Pty Ltd. and Noske-Kaeser Empreendimentos e Participaçôes do Brasil Ltda.) and Noske Kaeser US Rail & Vehicle LLC, whose financial statements reflect total assets of Rs. 224.04 Crores as at 31st March 2017, total revenues of Rs. 364.01 Crores and net cash inflows amounting to Rs.(1.04) Crores for the year ended on that date, as considered in the consolidated IND AS financial statements. These financial statements have been audited by other auditors whose reports have been furnished to us by the Management and our opinion on the consolidated IND AS financial statements, in so far as it relates to the amounts and disclosures included in respect of these subsidiaries, is based solely on the reports of the other auditors. Our opinion on the consolidated IND AS financial statements, and our report on Other Legal and Regulatory requirements below, is not modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors.

The financials of Noske Kaeser Rail & Vehicles New Zealand Limited, one of the wholly owned subsidiary, are consolidated financials and includes financials of its two step down subsidiaries viz; Noske-Kaeser Rail & Vehicle Australia Pty Ltd. and Noske-Kaeser Empreendimentos e Participaçôes do Brasil Ltda.

Noske Kaeser US Rail & Vehicle LLC was not considered for the purpose of consolidation as it is yet to commence its operations.

Our opinion is not qualified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by sub-section 3 of Section 143 of the Act, we report, to the extent applicable, that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit of the aforesaid consolidated IND AS financial statements.

(b) In our opinion, proper books of account as required by law relating to preparation of the aforesaid consolidated IND AS 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, the consolidated statement of cash flows and consolidated statement of changes in equity dealt with by this Report are in agreement with the relevant books of account maintained for the purpose of preparation of the consolidated IND AS financial statements.

(d) In our opinion, the aforesaid consolidated IND AS financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. and Companies (Indian Accounting Standard) Rules, 2015, as amended;

(e) On the basis of the written representations received from the directors of the Holding Company as on 31st March 2017 taken on record by the Board of Directors of the Holding Company and the report of the statutory auditors of its subsidiary company incorporated outsideIndia, none of the Directors of the Company is disqualified as on 31st March, 2017 from being appointed as a Director of that Company in terms of sub-section 2 of Section 164 of the Act. None of the subsidiaries of the Company is incorporated in India.

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Group and the operating effectiveness of such controls, refer to our separate report in “Annexure A”; and

(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 IND AS financial statements disclose the impact of pending litigations on the consolidated financial position of the Group. Refer Note 36 to the consolidated IND AS financial statements;

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

iii. The Holding Company was not required to transfer funds to the Investor Education and Protection Fund during the financial year under review.

iv. The Company has provided requisite disclosures in its consolidated IND AS financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016 and those are in accordance with the books of accounts maintained by the Company. Refer Note 48 of the consolidated IND AS financial statements.






Annexure - A to the Auditors’ report 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 IND AS financial statements of the Company as of and for the year ended 31st March

2017, we have audited the internal financial controls over financial reporting of LEEL Electricals Limited (Formerly known as Lloyd

Electric & Engineering Limited)(“the Holding Company”) (none of its subsidiary companies are companies incorporated in India), as of

that date.

Management’s Responsibility for Internal Financial Controls

The Respective Board of Directors of the Holding Company, are responsible for establishing and maintaining internal financial controls

based on the internal control over financial reporting criteria established by the Company considering the essential components of

internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of

Chartered Accountants of India (“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.

Auditors’ Responsibility

Our 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 on Audit of Internal Financial Controls over Financial Reporting (the

“Guidance Note”) issued by ICAI and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of

the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, 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 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 judgment, including the assessment of the risks of material misstatement of the IND AS financial statements, whether

due to fraud or error.

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

Company’s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A 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 authorizations of management and directors of the company; and (3) provide reasonable assurance

regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a

material effect on the financial statements.


127

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper

management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any

evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial

control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the

policies or procedures may deteriorate.

Opinion

In our opinion, the Holding Company, 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 2017, based on the

internal control over financial reporting criteria established by the Company considering the essential components of internal control

stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the ICAI.






CONSOLIDAtED BALANCE ShEEtAS At 31St MARCh 2017

(` In Crores)


As at 31.03.2017

As at 31.03.2016

As at 01.04.2015

ASSETSNon Current AssetsProperty, Plant and Equipment 3 400.30 411.82 401.41 Capital Work in Progress 4 10.37 6.70 7.69 Intangible Assets 5 6.13 9.34 8.15 Financial Assets(i) Investments 6 2.38 1.59 2.14 (ii) Loans 7 2.80 3.24 2.76 (iii) Other Financial Assets 8 0.21 0.23 0.33 Other Non Current Assets 9 - 0.14 1.29

422.19 433.08 423.76 Current AssetsInventories 10 1,048.63 938.93 772.34 Financial Assets(i) Trade Receivables 11 759.85 674.22 523.74 (ii) Cash and Cash Equivalents 12 94.04 69.73 63.49 (iii) Bank Balance other than (ii) above 13 4.23 4.98 1.16 (iv) Loans 14 1.54 1.54 0.85 (v) Other Financial Assets 15 0.03 0.02 0.04 Current Tax Assets (Net) 13.97 15.79 24.41 Other Current Assets 16 118.60 83.47 102.09

2,040.89 1,788.68 1,488.11 TOTAL ASSETS 2,463.08 2,221.76 1,911.87

EQUItY AND LIABILItIESEquityEquity Share Capital 17 40.34 36.21 35.33 Other Equity 18 860.07 746.91 722.83

900.41 783.12 758.16 Non Current LiabilitiesFinancial LiabilitiesBorrowings 19 51.00 89.91 106.19 Long term Provisions 20 7.21 2.91 3.08 Deffered Tax Liabilities 21 4.63 8.86 9.53

62.83 101.68 118.80 Current LiabilitiesFinancial Liabilities(i) Borrowings 22 1,080.64 966.69 743.37 (ii) Trade Payables 23 185.51 178.13 148.02 (iii) Other Financial Liabilities 24 60.91 67.47 61.74 Other Current Liabilities 25 127.75 99.16 57.59 Short Term Provisions 26 11.04 9.88 5.11 Current Tax Liabilities (Net) 34.00 15.63 19.08

1,499.84 1,336.96 1,034.91 tOtAL EQUItY AND LIABILItIES 2,463.08 2,221.76 1,911.87 NOTES TO ACCOuNTSAccompanying Notes are an integral part of the Financial Statements





129

CONSOLIDATED STATEMENT OF prOFIT AND LOSSFOR thE YEAR ENDED 31St MARCh 2017

(` In Crores)


For the year ended 31.03.2017

For the year ended31.03.2016

RevenueRevenue from operations 27 3,366.85 2,720.32 Other income 28 8.93 9.09 Total Income 3,375.78 2,729.41 ExpensesCost of materials consumed 29 2,406.12 1,914.64 Purchases of stock-in-trade 30 270.13 142.74 Changes in inventories of finished goods work-in-progress and stock-in-trade 31 (57.16) (16.74)Excise duty on sale of goods 45.12 51.98 Employee benefits expense 32 178.78 148.54 Finance costs 33 119.95 106.15 Depreciation and amortization expense 34 48.95 45.35 Other expenses 35 259.61 226.16 Total Expenses 3,271.50 2,618.83 Profit before exceptional items and tax 104.28 110.59 Exceptional Items Insurance claims written off - 45.80 Profit before tax 104.28 64.78 tax expense:(1) Current tax 36.93 17.65 (2) Deferred tax (2.64) (1.51)(3) MAT Credit Entitlement - 6.94 Profit for the year 69.99 41.70

Other Comprehensive IncomeItems that will be reclassified to profit or loss Fair value of Investment 0.79 0.71 Acturial gain or losses (0.68) - Taxes 0.23 - total Comprehensive Income for the year 70.34 42.41 Earnings per Equity Share(1) Basic 17.44 11.71 (2) Diluted 17.44 10.26 NOTES TO ACCOuNTSAccompanying Notes are an integral part of the Financial Statements






CONSOLIDAtED StAtEMENt OF ChANgES IN EQUItYAS ON 31St MARCh 2017

A. Equity Share Capital

Particulars No. of Shares (` in Crores)Paid up Capital 35,320,260 35.32 Add: Equity Shares forfeited - 0.01 As at April 1, 2015 35,320,260 35.33 Add: Equity Shares issued under Warrants 885,000 0.89 As at March 31, 2016 36,205,260 36.21 Add: Equity Shares issued under Warrants 4,127,000 4.13 As at March 31, 2017 40,332,260 40.34

B. Other Equity (` In Crores)

Particulars Reserves & Surplus Other Comprehensive Income Total EquityEquity

Component of Other Financial

Instruments (Share

Warrants)

Capital Reserve (Share

Warrant Forfeited

by the Company)

Revaluation Reserve

(Land Revalued as on 31st

March 1993)

Securities premium Account

Statutory Reserve

general Reserve

retained Earning

Fair Value of

Investment

Acturial gain & Losses

Exchange Difference

Balance as at 1st April 2015 22.80 11.25 0.23 199.07 1.70 202.72 277.63 (0.53) - 7.97 722.83

Profit for the Year - - - - - - 41.70 - - - 41.70

Transfer Share Warrant into Shares (3.36) - - - - - - - - (11.19) (14.55)


- - - 12.57 - - - - - - 12.57

Addition in Fair Value of Investment - - - - - - - 0.71 - - 0.71

Sale of Investment through OCI - - - - - - (0.42) 0.42 - - -

Statutory Reserve - - - - 0.25 - - - - - 0.25

MAT Credit Adjustment - - - - - - (11.09) - - - (11.09)

Dividend (Including Dividend Tax) - - - - - - (5.51) - - - (5.51)

Transfer to Reserve - - - - - 15.00 (15.00) - - - -

Balance as at 31st March 2016 19.44 11.25 0.23 211.64 1.95 217.72 287.30 0.60 - (3.22) 746.91

Profit for the Year 69.99 69.99

Transfer Share Warrant into Shares (19.44) - - - - - - - - - (19.44)


- - - 58.60 - - - - - - 58.60

Addition in Fair Value of Investment - - - - - - - 0.79 - - 0.79

Acturial Gain & Loss - - - - - - - - (0.44) - (0.44)

Share Warrants Forfeited - 3.75 - - - - - - - - 3.75

Statutory Reserve - - - - (0.15) - - - - 5.72 5.57

Dividend (Including Dividend Tax) - - - - - - (5.66) - - - (5.66)

Transfer to Reserve - - - - - 30.00 (30.00) - - - -

Balance as at 31st March 2017 - 15.00 0.23 270.24 1.80 247.72 321.63 1.39 (0.44) 2.50 860.07





131

CONSOLIDAtED StAtEMENt OF CASh FLOWFOR thE YEAR ENDED 31St MARCh 2017

(` In Crores)

Particulars For the Year ended 31 March 2017

For the Year ended 31 March 2016

A Cash Flow from Operating Activities1 Profit Before tax

Profit before tax 104.28 64.78 2 Adjustments for :

Depreciation 48.95 45.35 Loss/(gain) on disposal of property, plant and equipments (net) 0.01 0.01 Life Time Credit Risk 0.27 0.30 Finance costs 119.95 106.15 Dividend Received (0.02) (0.05)Loss/(gain) arising on financial assets/liabilities as at fair value through profit and loss 0.04 0.12 Interest Income (0.62) (0.14)

3 Operating Profit before Working Capital Changes (1+2) 272.86 216.53 4 Net Change in:

Trade Receivables (85.64) (150.48)Inventories (109.70) (166.59)Other Financial Assets 0.02 0.11 Loans 0.44 (1.18)Other Assets (34.99) 1.73 Trade Payable 7.38 30.11 Other Financial Liabilities (6.56) 5.73 Other Liabilities 28.59 41.57 Provisions 5.45 4.60 Change in Working Capital (195.01) (234.39)

5 Cash generated from Operating Activities (3+4) 77.85 (17.86)6 Taxes Paid (18.28) (12.42)7 Exchange Fluctuation 5.72 (11.19)8 Net Cash Flow from Operating Activities (5-6-7) 65.29 (41.48)B Cash Flow from Investing Activities:

Purchase of Property, plant and equipment including CWIP (38.13) (50.76)Purchase of Intangible Assets (1.48) (5.09)Proceeds from disposal of Property, plant & equipment 1.69 0.84 Proceeds from Intangible 0.03 0.09 Purchase of Investments (0.79) 0.54 Interest received 0.62 0.14 Dividend Income 0.02 0.05 Net Cash generated/(Used) in Investing Activities: (38.04) (54.18)

C Net Cash Flow From Financing Activities:Proceeds from Issue of Share Capital & other Equity 46.89 10.34 Proceeds from Borrowing 75.03 207.03 Interest paid (119.95) (106.15)Dividends paid (including dividend tax) (5.66) (5.51)Net Cash generated/(Used) from Financing Activities: (3.69) 105.71

D Net Change in Cash & cash equivalents (A+B+C) 23.56 10.05 E Net increase/ decrease in Cash and Cash Equivalents 23.56 10.05

Opening Balance of Cash and Cash Equivalents 74.71 64.65 Closing Balance of Cash and Cash Equivalents 98.27 74.71






NOTES TO CONSOLIDATED FINANCIAL STATEMENTSFOR thE YEAR ENDED 31St MARCh 2017

1. Corporate Information

LEEL Electricals Limited (Formally known as Lloyd Electric & Engineering Limited) is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on National Stock Exchange of India Limited & BSE Ltd. in India. The Company has also issued GDR’s which are listed on London Stock Exchange. The Company is the largest manufacturer of heat exchangers coils in India. It manufactures air conditioners for various brands as OEM / ODM including its own brand f LLOYD. During the year, the Company was also engaged in the consumer durable business under “Lloyd” brand which includes product portfolio like Air-Conditioner, LED TV, Washing Machines, Chest Freezers and other small home appliances. The Company caters to both domestic and international markets. The Company has sold its consumer durable business to Havells India Ltd. For details please refer note no. 46.

The Company along with its subsidiaries has been collectively hereinafter referred to as “the Group”.

2. Significant Accounting Policies

2.1 Basis of preparation of Consolidated Financial Statements.

The consolidated financial statements comprise the financial statement of LEEL Electricals Limited and its subsidiaries as at 31st March 2017. The Group has adopted accounting policies that comply with Indian Accounting standards (IND AS or IND AS) notified by Ministry of Corporate Affairs vide notification dated 16 February 2015 under section 133 of the Companies Act 2013. Accounting policies have been applied consistently to all periods presented in these consolidated financial statements.

The consolidated financial statements referred hereinafter have been prepared in accordance with the requirements and instructions of Schedule III to the Companies Act, 2013, amended from time to time applicable to companies to whom IND AS applies.

The opening consolidated financial statements have been prepared in accordance with “Indian Accounting Standard 101” (First time Adoption of Indian Accounting Standards). The opening financial statements comprises of Balance Sheet, Statement of Change in equity and its related notes.

Upto the year ended 31st March 2016, the Group prepared its financial statements in accordance with the requirements of previous GAAP, which includes Standards notified under the Companies (Accounting Standards) Rules, 2006. These are the Group’s first IND AS financial statements. The date of transition to IND AS is April 1, 2015.

The adopted accounting policies comply with each Ind-AS effective at the end of its first Ind-AS reporting period i.e. 31st March 2017 except as specified in paragraphs 13–19 and Appendices B–D of IND AS 101. In the groups’ opening financial statements:

(i) All assets and liabilities have been recognized as required by IND AS.

(ii) All assets and liabilities have been derecognized which are not permitted by IND AS.

(iii) All assets, liabilities or components of equity have been reclassified in accordance with IND AS.

(iv) All assets and liabilities have been measured in accordance with IND AS.

The accounting policies used by the Group in its opening financial statement may differ from those previously used in accordance with Indian Generally Accepted Accounting Principles (GAAP) or the previous GAAP. The resulting adjustments for events and transactions before the date of transition to IND AS, have been directly recognized in retained earnings at the date of transition to Ind-AS i.e. April 1, 2015 (or, if appropriate, another category of equity) at the date of transition to IND AS.

A Groups estimates in accordance with IND AS at the date of transition to IND ASs are consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.


133

The company has explained how the transition from previous GAAP to IND ASs has affected its reported Balance sheet and its financial performance. Accordingly, the company’s first IND AS consolidated financial statements include:

a. Reconciliations of its equity reported in accordance with previous GAAP to its equity in accordance with IND AS for both of the following dates:

(i) the date of transition to IND AS; and

(ii) the end of the latest period presented in the entity’s most recent annual financial statements in accordance with previous GAAP.

b. A reconciliation to its total comprehensive income in accordance with IND ASs for the latest period in the entity’s most recent annual financial statements. The starting point for that reconciliation being the total comprehensive income in accordance with previous GAAP for the same period or, if an entity did not report such a total, profit or loss under previous GAAP.

c) Details of impairment losses recognized or reversed for the first time in preparing its opening IND AS Balance Sheet in accordance with IND AS 36, Impairment of Assets.

The Company’s first consolidated IND AS financial statements includes three Balance Sheets, two Statements of profit and loss, two Statements of cash flows and two Statements of changes in equity and related notes, including comparative information for all statements presented.

The group’s first financial statements have been prepared in accordance with the IND AS prescribed. The preparation of the group’s first financial statements in conformity with Indian Accounting Standard (IND AS) requires the group to exercise its judgment in the process of applying the accounting policies. It also requires the use of accounting estimates and assumptions that effect the reported amounts of assets and liabilities at the date of the financial statements. These estimates and assumptions are assessed on an ongoing basis and are based on experience and relevant factors, including expectations of future events that are believed to be reasonable under the circumstances and presented under the historical cost convention on accrual basis of accounting.

2.2 Principles of Consolidation

The Consolidated financial statements relate to LEEL Electricals Limited (Formally Known as Lloyd Electric & Engineering Limited) (‘the company’) and its subsidiary companies. In the preparation of the consolidated financial statements, investments in subsidiaries, associates and joint ventures are accounted for in accordance with the requirements of IND AS 110 (Consolidated Financial Statements) and IND AS 28 (Investments in Associates and Joint Ventures) vide notification dated 16 February 2015 under section 133 of the Companies Act 2013.

Investment in Subsidiaries

The consolidated financial statements incorporate the financial statements of the Company and entities (including structured entities) controlled by the Company and its subsidiaries. Control is achieved when the Company:

• has power over the investee;

• is exposed, or has rights, to variable returns from its involvement with the investee; and

• has the ability to use its power to affect its returns.

The Company reassesses whether or not it controls an investee if facts and circumstances indicate there are changes to one or more of the three elements of control listed above.

When the Company has less than a majority of the voting rights of an investee, it has power over investee when the voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The Company considers all relevant facts and circumstances assessing whether or not the Company’s voting rights in an investee are sufficient to give it power including:

• the size of the Company’s holding of voting rights relative to the size and dispersion of holdings of the other vote holders;

• Potential rights held by the Company, other vote holders or other parties;

• rights arising from other contractual arrangements; and



• any additional facts and circumstances that indicate that the Company has, or does not have, current ability to direct the relevant activities at the time that decisions need to be made, including voting patterns at previous shareholders’ meetings.

Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated statement of profit and loss from the date the Company gains control until the date when the Company ceases to control subsidiary.

Changes in the group’s ownership interests in existing subsidiaries

When the Group does not lose control of subsidiary.

i) Changes in the Group’s ownership interests in subsidiaries are accounted for as equity transactions.

ii) The carrying amounts of the Group’s interests and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries.

iii) Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to owners of the Company.

When the group loses control of a subsidiary,

i) Derecognizes the assets and liabilities of the former subsidiary from the consolidated balance sheet.

ii) A gain or loss is recognized in profit or loss and is calculated as the difference between the aggregate of the fair value of the consideration received and the fair value of any retained interest and the previous carrying amount of the assets (including goodwill), and liabilities of the subsidiary and any non-controlling interests.

iii) All amounts previously recognized in other comprehensive income in relation to that subsidiary are accounted for as if the Group had directly disposed of the related assets and liabilities of the subsidiary (i.e. reclassified to profit or loss or transferred to another category of equity as specified/permitted by applicable IND AS).

iv) The fair value of any investment retained in the former subsidiary at the date when control is lost is regarded as the fair value on initial recognition for subsequent accounting under IND AS 109, or, when applicable, the cost on initial recognition of an investment in an associate or a joint venture.

2.3 the Consolidated Financial Statements of Subsidiaries is prepared on the following basis:

i) Combining like items of assets, liabilities, equity, income, expenses and cash flows of the Parent with those of its subsidiaries.

ii) Eliminating in full intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between entities of the group.

iii) Offsetting (eliminate) the carrying amount of the parent’s investment in each subsidiary and the parent’s portion of equity of each subsidiary.

iv) Profit or loss and each component of other comprehensive income are attributed to the owners of Company and to the non-controlling interests. Total comprehensive income of subsidiaries attributed to the owners of the Company and to the non-controlling interests even if this results in non-controlling interests having a deficit balance.

v) When necessary, adjustments are made to the financial statements of subsidiaries to bring accounting policies into line with the Group’s accounting policies.

vi) The Company present’s non-controlling interests in the consolidated balance sheet within equity, separately from the equity of the owners of the parent. Changes in a parent’s ownership interest in a subsidiary that do not result in the parent losing control of the subsidiary are considered as equity transactions (i.e. transactions with owners in their capacity as owners).

vii) As far as possible, the Consolidated Financial Statements are prepared using uniform accounting policies for like transactions and other events in similar circumstances and are presented, to the extent possible, in the same manner as the Company’s separate financial statements, Where it is not practicable to use uniform accounting policies, adjustments are made to the financial statements of subsidiaries to bring accounting policies into line with the Group’s accounting policies.


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viii) The financial statements of the group entities used for the purpose of consolidation are drawn up to the same reporting date as that of the Company i.e. year ended 31st March 2017.

Business Combination

Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the Group, liabilities incurred by the Group to the former owners of the acquiree and the equity interests issued by the Group in exchange of control of the acquiree. Acquisition-related costs are generally recognized in profit or loss as incurred.

At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognized at their fair value, except that:

(i) deferred tax assets or liabilities, and assets or liabilities related to employee benefit arrangements are recognized and measured in accordance with IND AS 12 Income Taxes and IND AS 19 Employee Benefits respectively;

(ii) liabilities or equity instruments related to share-based payment arrangements of the acquiree or share-based payment arrangements of the Group entered into to replace share-based payment arrangements of the acquiree are measured in accordance with IND AS 102 Share-based Payment at the acquisition date; and

(iii) assets (or disposal groups) that are classified as held for sale in accordance with IND AS 105 Non-current Assets Held for Sale and Discontinued Operations are measured in accordance with that Standard.

Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed.

In case of a bargain purchase, before recognizing a gain in respect thereof, the Group determines whether there exists clear evidence of the underlying reasons for classifying the business combination as a bargain purchase. Thereafter, the Group reassesses whether it has correctly identified all of the assets acquired and all of the liabilities assumed and recognizes any additional assets or liabilities that are identified in that reassessment. The Group then reviews the procedures used to measure the amounts that IND AS requires for the purposes of calculating the bargain purchase. If the gain remains after this reassessment and review, the Group recognizes it in other comprehensive income and accumulates the same in equity as capital reserve. This gain is attributed to the acquirer. If there does not exist clear evidence of the underlying reasons for classifying the business combination as a bargain purchase, the Group recognizes the gain, after reassessing and reviewing (as described above), directly in equity as capital reserve.

Non-controlling interests that are present ownership interests and entitle their holders to a proportionate share of the entity’s net assets in the event of liquidation may be initially measured either at fair value or at the non-controlling interests’ proportionate share of the recognized amounts of the acquiree’s identifiable net assets. The choice of measurement basis is made on a transaction-by-transaction basis. Other types of non-controlling interests are measured at fair value or, when applicable, on the basis specified in another IND AS.

When the consideration transferred by the Group in a business combination includes assets or liabilities resulting from a contingent consideration arrangement, the contingent consideration is measured at its acquisition-date fair value and included as part of the consideration transferred in a business combination.

transitional Provisions in opening balance sheet per IND AS 101

In accordance with IND AS 101, the group has not applied IND AS 103 retrospectively to a past business combination, this has led to the following consequences for the business combination that occurred before the date of transition to IND AS:

(i) The group has kept the same classification as in its previous GAAP financial statements.

(ii) The group has recognized all its assets and liabilities at the date of transition to IND ASs that were acquired or assumed in a past business combination, other than:

some financial assets and financial liabilities derecognized in accordance with previous GAAP and

assets, including goodwill, and liabilities that were not recognized in the acquirer’s consolidated Balance Sheet in accordance with previous GAAP.



The group then recognizes any resulting change by adjusting retained earnings (or, if appropriate, another category of equity), unless the change results from the recognition of an intangible asset that was previously subsumed within goodwill.

The group excludes from its opening IND AS Balance Sheet any item recognized in accordance with previous GAAP that does not qualify for recognition as an asset or liability under IND ASs.

The Group determines whether a transaction or other event is a business combination by applying the definition in IND AS 103, which requires that the assets acquired and liabilities assumed constitute a business. If the assets acquired are not a business, the group accounts for the transaction or other event as an asset acquisition.

Where the acquisition of an asset or a group of assets does not constitute a business, the group identifies and recognizes the individual identifiable assets acquired (including those assets that meet the definition of, and recognition criteria for, intangible assets in IND AS 38, Intangible Assets and liabilities assumed). The cost of the group is then allocated to the individual identifiable assets and liabilities on the basis of their relative fair values at the date of purchase

Foreign currencies

For the purposes of presenting these consolidated financial statements, the assets and liabilities of Group’s foreign operations are translated into Indian Rupees using exchange rates prevailing at end of each reporting period. Income and expense items are translated at the average exchange rate for the period, unless exchange rates fluctuate significantly during that period, in which case exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognized in other comprehensive income and accumulated in equity (and attributed to non-controlling interests as appropriate).

On the disposal of a foreign operation (i.e. a disposal of the Group’s entire interest in a foreign operation, a disposal involving loss of control over a subsidiary that includes a foreign operation, or a partial disposal of an interest in a joint arrangement or an associate that includes a foreign operation of which the retained interest becomes a financial asset), all of the exchange differences accumulated in equity in respect of that operation attributable to the owners of the Company are reclassified to profit or loss.

In addition, in relation to a partial disposal of a subsidiary that includes a foreign operation that does not result in the Group losing control over the subsidiary, the proportionate share of accumulated exchange differences are re-attributed to non-controlling interests and are not recognized in profit or loss. For all other partial disposals (i.e. partial disposals of associates or joint arrangements that do not result in the Group losing significant influence or joint control), the proportionate share of the accumulated exchange differences is reclassified to profit or loss.

2.4 thE LISt OF SUBSIDIARIES:

Name of the Subsidiary Nature of Relationship

Country of Incorporation

Extent of holding (%)31.03.2017 31.03.2016

Lloyd Coils Europe s.r.o. Wholly Owned Subsidiary

Czech Republic 100 100

Janka Engineering s.r.o. Wholly Owned Subsidiary

Czech Republic 100 100

Noske Kaeser Rail & Vehicle Germany GmbH (“NK G”)

Wholly Owned Subsidiary

Germany 100 100

Noske Kaeser Rail & Vehicles New Zealand Ltd. (“NK NZ”)

Wholly Owned Subsidiary

New Zealand 100 100

Noske Kaeser US Rail & Vehicle LLC (“NK US”) Wholly Owned Subsidiary

United States 100 100

Noske-Kaeser Rail & Vehicle Australia Pty Ltd. Indirect Wholly owned Subsidiary*

Australia 100 100

Noske-Kaeser Empreendimentos e Participaçôes do Brasil Ltda.

Indirect Wholly owned Subsidiary*

Brasil 100 100

* wholly owned subsidiary of Noske Kaeser Rail & Vehicles New Zealand Ltd. The consolidated financials includes their results w.e.f. the respective dates except NK US, which is yet to commence its operations.

For details please refer note no. 51 of the standalone statements.


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2.5 Property, Plant and Equipment (PPE)

The Company has elected to use a previous GAAP cost (cost less accumulated depreciation and impairment losses (if any)) of an item of property, plant and equipment at, or before, the date of transition to IND AS as deemed cost at the date of transition in accordance with accounting policy option available in IND AS 101.

PPE are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any. The initial cost of PPE comprise its purchase price, including import duties, net of modvat/cenvat, less accumulated depreciation and include any directly attributable costs of bringing an asset to working condition and location for its intended use, including borrowing costs relating to the qualified asset over the period up to the date the assets are put to use is included in cost of relevant assets. Exchange rate variations relating to long term monetary items is charged to profit & loss if foreign currency loan is taken after 31 March 2016.

All other expenditure related to existing assets including day-to-day repair and maintenance expenditure and cost of replacing parts, are charged to the statement of profit and loss in the period during which such expenditure is incurred.

The carrying amount of a property, plant and equipment is de-recognized when no future economic benefits are expected from its use or on disposal.

Machine spares that can be used only in connection with an item of fixed asset and their use is expected for more than one year are capitalized.

Depreciation on property plant and equipment is provided on straight line method based on estimated useful life of assets as prescribed in schedule II to the Companies Act, 2013. Estimated useful lives of the assets are as follow:

Class of Assets Rate of Depreciation

Buildings 30 Years

Plant & Machinery 15 Years

Office Equipment 5 Years

Furniture & Fixtures 10 Years

Vehicles 8 Years

The property, plant and equipment acquired under finance leases, if any, is depreciated over the asset’s useful life or over the shorter of the asset’s useful life and the lease term if there is no reasonable certainty that the Company will obtain ownership at the end of the lease term.

Depreciation on the assets purchased during the year is provided on pro-rata basis from the date of purchase of the assets.

Gains and losses on de-recognition/disposals are determined as the difference between the net disposal proceeds and the carrying amount of those assets. Gains and Losses if any, are recognized in the statement of profit or loss on de-recognition or disposal as the case may be.

Capital Work-in-Progress

Projects under commissioning and other Capital Work-in-Progress are carried at cost, comprising direct cost, related incidental expenses and attributable interest.

2.6 Intangible Assets

The company has elected to use a previous GAAP cost (cost less accumulated depreciation and impairment losses (if any)) of an intangible assets at, or before, the date of transition to IND AS as deemed cost at the date of transition in accordance with accounting policy option in IND AS 101.

Intangible assets acquired separately are measured on initial recognition at cost less accumulated amortization and accumulated impairment losses, if any.

The cost of an intangible asset includes purchase cost (net of rebates and discounts), including any import duties and non-refundable taxes, and any directly attributable costs on making the asset ready for its intended use.



The Cost of Intangible assets are amortized on a straight line basis over their estimated useful life which is as follows:

Logo of Brand “LLOYD”: Cost of logo is amortized over its useful life of 6 years.

Product Development Expenses: Cost of Product Development expenses will be amortized over its useful life of 5 Years.

The amortization period and method are reviewed at least at each financial year end. If the expected useful life of the asset is significantly different from previous estimates, the amortization period is changed accordingly.

An intangible asset is derecognized on disposal or when no future economic benefits are expected from use. Gains and losses arising from de-recognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset are recognized in the statement of profit and loss when the asset is derecognized or on disposal.

2.7 Inventories

Raw materials and consumables are valued at cost and includes purchase price, freight costs, customs duty (wherever paid) and are net of credit availed under CENVAT scheme. The cost is determined using the Weighted Average Method.

Stock in process is valued at own production costs after providing for obsolescence, if any. The own production costs includes direct and indirect materials, direct and indirect labour and other manufacturing overheads incurred in bringing them to their respective present location and condition.

Finished goods are valued at lower of own production costs on the basis of Weighted average method or net realizable value, after providing for obsolescence, if any. The own production costs includes direct and indirect materials, direct and indirect labour and other manufacturing overheads incurred in bringing them to their respective present location and condition.

Stock in transit lying in customs warehouse is valued at cost but does not include custom duty payable, however, non-provision of duty does not affect the profit for the year.

2.8 Impairment of tangible assets and intangible assets

At the end of each reporting period, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication based on internal/ external factors that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). When it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs. When a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified.

Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment at least annually, and whenever there is an indication that the asset may be impaired.

Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognized immediately in profit or loss.

The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount

2.9 Foreign Exchange transactions

These financial statements are presented in Indian rupees (INR), which is the Company’s functional currency. Transactions in foreign currency are recorded on initial recognition at the spot rate prevailing at the time of the transaction.


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At the end of each reporting period:

Monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured terms of historical cost in a foreign currency are not retranslated. Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition during the period or in previous financial statements are recognized in profit or loss in the period in which they arise.

Exchange differences on monetary items are recognized in profit or loss in the period in which they arise except for:

Exchange differences on foreign currency borrowings relating to assets under construction for future productive use, which are included in the cost of those assets when they are regarded as adjustment to interest costs on those foreign currency borrowings.

The exchange differences arising on reporting of long term foreign currency monetary items at rates different from those at which they were initially recorded in so far as they relate to the acquisition of depreciable capital assets are shown by addition to/deduction from the cost of the assets as per exemption provided under IND AS 21 read along with IND AS 101 appendix ‘D’ clause-D13AA.

Exchange differences on monetary items receivable from or payable to a foreign operation which settlement is neither planned nor likely to occur (therefore forming part of the investment in the foreign operation), which are recognized initially in other comprehensive income and reclassified from equity to profit or loss on repayment of the monetary items.

Forward Exchange Contracts not intended for trading or speculation purposes

The premium or discount arising at the inception of forward exchange contract is amortized and recognized as an expense/ income over the life of the contract. Exchange differences on such contracts, except the contracts which are long-term foreign currency monetary items, are recognized in the statement of profit and loss in the period in which the exchange rates change. Any profit or loss arising on cancellation or renewal of such forward exchange contract is also recognized as income or as expense for the year.

2.10 Borrowing Cost

Borrowing costs specifically relating to the acquisition or construction of a qualifying asset that necessarily takes a substantial period of time to get ready for its intended use are capitalized as part of the cost of the asset. All other borrowing costs are charged to profit & loss account in the period in which it is incurred except loan processing fees which is recognized as per Effective Interest Rate method. Borrowing costs consist of interest and other costs that company incurs in connection with the borrowing of funds. Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing costs.

2.11 Employee Benefits

Contribution to Provident fund/Pension fund: Retirement benefits in the form of Provident Fund / Pension Schemes are defined contribution schemes and the contributions are charged to the Profit & Loss Account in the year when the contributions to the respective funds become due. The Company has no obligation other than contribution payable to these funds.

Gratuity liability is a defined benefit obligation and is provided for on the basis of an actuarial valuation made at the end of each financial year. However, The Company is in process of having arrangement with Insurance Company to administer its Superannuation & Gratuity Fund.

Defined benefit plans: Defined benefit costs are categorized as follows:

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

• net interest expense or income and

• measurement

The Company presents the first two components of defined benefit costs in profit or loss in the line item ‘Employee benefits expense’. Curtailment gains and losses are accounted for as past service costs.



Remeasurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding net interest), is reflected immediately in the balance sheet with a charge or credit recognized in other comprehensive income in the period in which they occur. Remeasurement recognized in other comprehensive income is reflected immediately in retained earnings and is not reclassified to profit or loss. Past service cost is recognized in profit or loss in the period of a plan amendment.

Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset.

For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period.

The retirement benefit obligation recognized in the balance sheet represents the actual deficit or surplus in the company’s defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.

Liability for a termination benefit is recognized at the earlier of when the company can no longer withdraw the offer of the termination benefit and when the company recognizes any related restructuring costs.

Short-term and other long-term employee benefits: A liability is recognized for benefits accruing to employees in respect of wages and salaries, annual leave and sick leave in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchange for that service. These benefits include bonus/incentives and compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related service.

Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for the related service.

Liabilities recognized in respect of other long-term employee benefits are measured at the present value of the estimated future cash outflows expected to be made by the company in respect of services provided by employees up to the reporting date.

Accumulated leave, which is expected to be utilized within the next 12 months, is treated as short-term employee benefit. The company measures the expected cost of such absences as the additional amount that it expects to pay as a result of the unused entitlement that has accumulated at the reporting date

The cost of the defined benefit gratuity plan and their present value are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

The most sensitive is discount rate. The management has considered the interest rates of government bonds. Future salary increases and gratuity increases are based on expected future inflation rates.

2.12 tax Expenses

Income Tax expense comprises of current tax and deferred tax charge or credit. Provision for current tax is made with reference to taxable income computed for the financial year for which the financial statements are prepared by applying the tax rates as applicable.

Current tax: Current Income tax relating to items recognized outside the profit and loss is recognized outside the profit and loss (either in other comprehensive income or in equity)

Deferred tax: Deferred tax is provided using the balance sheet approach on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purpose at reporting date. Deferred income tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of changes in tax rates on deferred income tax assets and


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liabilities is recognized as income or expense in the period that includes the enactment or the substantive enactment date. A deferred income tax asset is recognized to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences and tax losses can be utilized.

The carrying amount of deferred tax assets is reviewed as at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will not be available against which deferred tax asset to be utilized. Unrecognized deferred tax assets are re-assessed at each reporting date and are recognized to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

Deferred tax assets are recognized for the unused tax credit to the extent that it is probable that taxable profits will be available against which the losses will be utilized. Significant management judgment is required to determine the amount of deferred tax assets that can be recognized, based upon the likely timing and the level of future taxable profits.

2.13 Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

A lease is classified at the inception date as a finance lease or an operating lease. A lease that transfers substantially all the risks and rewards incidental to ownership to the Company is classified as a finance lease. When acquired, such assets are capitalized at fair value of the leased property or present value of minimum lease payments, at the inception of lease, whichever is lower.

Other leases are operating leases. Operating lease payments are recognized as an expense in the statement of profit and loss on a straight line basis over the lease term. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and amortized over the lease term on the straight line basis.

As a Lessor

Leases in which the Company does not transfer substantially all the risks and rewards of ownership of an asset are classified as operating leases. Assets subject to operating leases are included in PPE. Rental income from operating lease is recognized on a straight-line basis over the term of the relevant lease. Where the rentals are structured solely to increase in line with expected general inflation to compensate for the company’s expected inflationary cost increases, such increases are recognized in the year in which such benefits accrue.

Costs, including depreciation, are recognized as an expense in the statement of profit and loss. Initial direct costs such as legal costs, brokerage costs, etc. are recognized immediately in the statement of profit and loss.

As a lessee

Leases in which significant portions of risks and reward of ownership are not transferred to the company as lessee are classified as operating leases. Operating lease payments are recognized as an expense in the Profit and Loss account on a straight-line basis over the lease term. Where the rentals are structured solely to increase in line with expected general inflation to compensate for the lessor’s expected inflationary cost increases, such increases are recognized in the year in which such benefits accrue. Contingent rentals arising under operating leases are recognized as an expense in the period in which they are incurred.

Leases where the lessor effectively transfers substantially all the risks and benefits of ownership of the asset are classified as finance leases and are capitalized at the inception of the lease term at the lower of the fair value of the leased property and present value of minimum lease payments. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognized as finance costs in the statement of profit and loss. Lease management fees, legal charges and other initial direct costs of lease are capitalized.

For arrangements entered into prior to 1 April 2015, the Company has determined whether the arrangement contain lease on the basis of facts and circumstances existing on the date of transition in accordance with IND AS 101 “First time adoption of Indian Accounting Standards”.



2.14 Fair Value Measurement

The Company measures certain financial instruments at fair value at each balance sheet date.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

i. In the principal market for the asset or liability, or

ii. In the absence of a principal market, in the most advantageous market for the asset or liability

The principal or the most advantageous market must be accessible by the Company.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities

Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For assets and liabilities that are recognized in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

For the purpose of fair value disclosures, the Company has determined classes of assets & liabilities on the basis of the nature, characteristics and the risks of the asset or liability and the level of the fair value hierarchy as explained above.

2.15 Financial Instrument

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

Financial asset is any assets that is

Cash;

an equity instrument of another entity;

a contractual right:

(i) to receive cash or another financial asset from another entity; or

(ii) to exchange financial assets or financial liabilities with another entity under conditions that are potentially favorable to the entity; or


(i) a non-derivative for which the entity is or may be obliged to receive a variable number of the entity’s own equity instruments; or


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(ii) a derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments.

Financial assets includes non-current investments, loan to employees, security deposits, trade receivables and other eligible current and non-current assets

Financial Liability is any liabilities that is

a contractual obligation :

(i) to deliver cash or another financial asset to another entity; or

(ii) to exchange financial assets or financial liabilities with another entity under conditions that are potentially unfavorable to the entity; or


(i) a non-derivative for which the entity is or may be obliged to deliver a variable number of the entity’s own equity instruments; or

(ii) a derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments. For this purpose, rights, options or warrants to acquire a fixed number of the entity’s own equity instruments for a fixed amount of any currency are equity instruments if the entity offers the rights, options or warrants pro rata to all of its existing owners of the same class of its own non-derivative equity instruments.

Financial liabilities includes Loans, trade payable and eligible current and non-current liabilities

i) transitional Provisions in opening balance sheet per IND AS 101

The Company designates a previously recognized financial asset/financial liability as a financial asset/ financial liability measured at fair value on the basis of the facts and circumstances that exist at the date of transition to IND AS.

The Company designates an investment in an equity instrument other than investment in subsidiary, associates and Joint venture as at fair value through other comprehensive income on the basis of the facts and circumstances that exist at the date of transition to IND AS.

The Company has assessed whether a financial asset meets the conditions w.r.t classification criteria on the basis of the facts and circumstances that exist at the date of transition to Ind Ass, practically feasible.

ii) Classification

The Company classifies financial assets as subsequently measured at amortized cost, fair value through other comprehensive income or fair value through profit or loss on the basis of both:

• the entity’s business model for managing the financial assets and

• the contractual cash flow characteristics of the financial asset.

A financial asset is measured at amortized cost if both of the following conditions are met, the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and


A financial asset is measured at fair value through other comprehensive income if both of the following conditions are met:

• the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and


A financial asset is measured at fair value through profit or loss unless it is measured at amortized cost or at fair value through other comprehensive income.

All financial liabilities are subsequently measured at amortized cost using the effective interest method or fair value through profit or loss.



iii) Initial recognition and measurement

The company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of the instrument. All financial assets and liabilities are recognized at fair value at initial recognition, plus or minus, any transaction cost that are directly attributable to the acquisition or issue of financial assets and financial liabilities that are not at fair value through profit or loss.

iv) Financial assets subsequent measurement

Financial assets as subsequent measured at amortized cost, fair value through other comprehensive income (FVOCI) or fair value through profit or loss (FVTPL) as the case may be.

Financial liabilities as subsequent measured at amortized cost or fair value through profit or loss

v) Effective interest method

The effective interest method is a method of calculating the amortized cost of a debt instrument and allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees and points paid or received that form integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt instrument, or, where appropriate, a shorter period, to the net carrying amount on initial recognition.

Income is recognized on an effective interest basis for debt instruments other than those financial a classified as at FVTPL. Interest income is recognized in profit or loss and is included in the “Other income” line item.

vi) trade Receivables

Trade receivables are the contractual right to receive cash or other financial assets and recognized initially at fair value. Subsequently measured at amortized cost (Initial fair value less expected credit loss). Expected credit loss is the difference between all contractual cash flows that are due to the company and all that the company expects to receive (i.e. all cash shortfall), discounted at the effective interest rate.

vii) Equity investments

All equity investments in scope of IND AS 109 are measured at fair value other than investment in subsidiary, Associates and Joint venture. For all other equity instruments, the company may make an irrevocable election to present in other comprehensive income subsequent changes in the fair value. The Company makes such election on an instrument by- instrument basis

viii) Cash and cash Equivalents

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.

ix) Impairment of Financial Assets

The company recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are not fair valued through profit or loss. Loss allowance for trade receivables with no significant financing component is measured at an amount equal to lifetime ECL. For all other financial assets, expected credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognized is recognized as an impairment gain or loss in profit or loss.

x) Financial liabilities

Financial liabilities are recognized initially at fair value less any directly attributable transaction costs. These are subsequently carried at amortized cost using the effective interest method or fair value through profit or loss. For trade and other payables maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments


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xi) trade payables

Trade payables represent liabilities for goods and services provided to the Company prior to the end of financial year and which are unpaid. Trade payables are presented as current liabilities unless payment is not due within 12 months after the reporting period or not paid/payable within operating cycle. They are recognized initially at their fair value and subsequently measured at amortized cost using the effective interest method.

xii) Borrowings

Borrowings are initially recognized at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan.

Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period. Where there is a breach of a material provision of a long-term loan arrangement on or before the end of the reporting period with the effect that the liability becomes payable on demand on the reporting date, the company does not classify the liability as current, if the lender agreed, after the reporting period and before the approval of the financial statements for issue, not to demand payment as a consequence of the breach.

xiii) Equity Instruments

An equity instrument is any contract that evidences a residual interest in the assets of company after deducting all of its liabilities. Equity instruments are recognized at the proceeds received, net of direct issue costs.

xiv) De-recognition of financial instrument

The company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for de-recognition under IND AS 109. A financial liability (or a part of a financial liability) is derecognized from the company’s balance sheet when the obligation specified in the contract is discharged or cancelled or expires.

xv) Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously

xiv) Derivative Financial Instruments

Derivatives are initially recognized at fair value at the date the derivative contracts are entered and are subsequently re-measured to their fair value at the end of each reporting period. The resulting gain or loss is recognized in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss.

2.16 Provision and Contingent Liability

i. A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements.

ii. Contingent liabilities, if material, are disclosed by way of notes unless the possibility of an outflow of resources embodying the economic benefit is remote and contingent assets, if any, is disclosed in the notes to financial statements.

iii. A provision is recognized, when company has a present obligation (legal or constructive) as a result of past events and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, in



respect of which a reliable estimate can be made for the amount of obligation. The expense relating to the provision is presented in the profit and loss net of any reimbursement.

2.17 Earnings Per Share

Basic Earnings per share is computed by dividing the net profit after tax by the weighted average number of equity shares outstanding during the period. For the purpose of calculating Diluted earnings per share, the net profit for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

2.18 Revenue

Revenue is measured at the fair value of the consideration received or receivable, taking into account the contractually defined terms of payment net of returns and allowances, trade discounts and volume rebates, excluding taxes or duties collected on behalf of the government. Excise duty is the liability of manufacturer which forms the part of cost of production, irrespective of whether the goods are sold or not. Since the recovery of excise duty flows to the company on its own account, revenue includes excise duty. However, sales tax/ value added tax (VAT) is not received by the Company on its own account; rather it is tax collected on the value added to the commodity by the seller on behalf of the government, and hence it is excluded from revenue.

Revenue is recognized only when the significant risk and reward of the ownership is transferred to the buyer usually on delivery of the goods. Revenue is recognized to the extent that it is probable that the economic benefit will flow to the company, revenue can be reliably measured and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Further, sales include revision in prices received from customers with retrospective effect. Similarly, price revision for material purchased has also been included in purchases. Further adjustments, if any, are made in the year of final settlement.

Interest Income is recognized using the effective interest rate (EIR). EIR is the rate that exactly discounts the estimated future cash flows over the expected life of financial instrument, to the gross carrying amount of the financial assets or to the amortized cost of the financial liability.

Dividend income is recognized when the Company’s right to receive payment is established. (Provided that it is probable that the economic benefit will flow to the company).

Export sales are accounted on the basis of date of bill of lading.

Payments made in respect of goods cleared as also provision made for goods lying in bonded warehouse.

2.19 Operating cycle

Based on the nature of products / activities of the Company and the normal time between acquisition of assets and their realization in cash or cash equivalents, the Company has determined its operating cycle as 12 months for the purpose of classification of its assets and liabilities as current and non-current.

2.20 Investments

Investments are either classified as current or long term investment based on Management’s intention. Current investments (if any) are carried at the lower of cost and fair value of each investment individually. Investments in subsidiary company are of long-term strategic value. Cost for overseas investments comprises the Indian rupee value of the consideration paid for the investment translated at the exchange rate prevalent at the date of investment. Long term investments are carried at cost less provisions recorded to recognize any decline, other than temporary, in the carrying value of each investment.

2.21 Segment Reporting

i. Business Segment

As per IND AS 108, the Company has reportable segments viz. Radiators & Heat Exchanger, OEM & Railways, Consumer Durable Products during the year under review. Accordingly the reporting is done segment wise.


147

ii. geographical Segment

The analysis of geographical segment is based on the geographical location of the customers. The Company operates primarily in India and has presence in international markets as well. Its business is accordingly aligned geographically, catering to two markets. The Company has considered domestic and exports markets as geographical segments and accordingly disclosed these as separate segments. The geographical segments considered for disclosure are as follows;

- Sales within India represent sales made to customers located within India.

- Sales outside India represent sales made to customers located outside India.

2.22 grants

Grants are recognized when there is reasonable assurance that the grant will be received and conditions attached to them are complied with.

2.23 Research and development

Research costs are expensed as incurred.



NOtE 3: PROPERtY, PLANt & EQUIPMENt

the Changes in the carrying value of property, plant and equipment for the year ended March 31 2017 were as follows:(` In Crores)




Office Equipment


Other Assets

Adjustment to Assets

Total

Gross Carrying Value as on 1st April 2016

15.20 2.12 101.38 526.95 10.00 8.31 4.02 3.10 48.41 719.48

Additions - - 0.66 30.80 1.09 0.12 1.78 - - 34.46

Deletions - (0.19) - (1.72) (0.26) (0.22) (0.09) (0.99) - (3.47)

gross Carrying Value as on 31st March 2017

15.20 1.93 102.05 556.03 10.82 8.20 5.71 2.11 48.41 750.47


- 0.11 19.83 246.82 7.61 4.60 1.16 0.20 27.33 307.66

Depreciation for the year - - 2.93 35.36 1.14 0.77 0.51 - 3.57 44.29

Adjustment - - - (1.28) (0.25) (0.22) (0.02) - - (1.77)

Accumulated Depreciation as of 31st March 2017

- 0.11 22.77 280.90 8.49 5.16 1.65 0.20 30.90 350.17

Net Carrying Value as on 31st March 2017

15.20 1.82 79.28 275.13 2.33 3.05 4.06 1.92 17.51 400.30

Net Carrying Value as on 31st March 2016

15.20 2.00 81.55 280.13 2.38 3.70 2.86 2.90 21.08 411.82

the Changes in the carrying value of property, plant and equipment for the year ended March 31 2016 were as follows:(` In Crores)




Office Equipments


Other Assets

Adjustment to Assets

Total

Gross Carrying Value as on 1st April 2015

16.10 0.19 96.11 488.00 8.20 7.50 2.59 2.39 48.39 669.46

Additions - 0.39 5.67 40.62 1.78 1.66 1.42 0.20 - 51.75

Deletions (0.89) 1.54 (0.39) (1.67) 0.02 (0.85) (0.00) 0.51 0.02 (1.72)

Gross Carrying Value as on 31st March 2016

15.20 2.12 101.38 526.95 10.00 8.31 4.02 3.10 48.41 719.48


- 0.11 17.08 213.85 6.62 4.90 0.78 0.20 23.61 267.16

Depreciation for the year - - 2.77 32.99 0.99 0.52 0.37 - 3.72 41.37

Adjustment - - (0.02) (0.03) - (0.82) - - - (0.86)

Accumulated Depreciation as of 31st March 2016

- 0.11 19.83 246.82 7.61 4.60 1.16 0.20 27.33 307.66

Net carrying Value as on 31st March 2016

15.20 2.00 81.55 280.13 2.38 3.70 2.86 2.90 21.08 411.82

Net Carrying Value as on 1st April 2015

15.20 0.07 79.03 274.15 1.57 2.60 1.81 2.19 24.77 401.41

NOtE 4: CAPItAL WORK IN PROgRESS (` In Crores)Particulars As at

31 March 2017As at

31 March 2016As at

1 April 2015Capital work in progress 10.37 6.70 7.69 Total 10.37 6.70 7.69


149

NOtE 5: INtANgIBLE ASSEtSthe Changes in the carrying value of Intangible Assets for the year ended 31st March 2017 were as follows: (` In Crores)


product Development

Expenses

Total

Gross Carrying Value as on 1st April 2016 22.89 4.75 27.64 Additions 1.08 0.40 1.48 Deletions - (0.03) (0.03)Gross Carrying Value as on 31st March 2017 23.96 5.12 29.08

Accumulated Depreciation as of 1st April 2016 18.17 0.12 18.29 Depreciation for the year 4.52 0.15 4.67 Adjustment - - - Accumulated Depreciation as of 31st March 2017 22.69 0.27 22.96 Carrying Value as on 31st March 2017 1.27 4.85 6.13 Carrying Value as on 31st March 2016 4.72 4.63 9.34

the Changes in the carrying value of Intangible Assets for the year ended 31st March 2016 were as follows:Particulars Intangible Fixed

Assetsproduct

Development Expenses

Total

Gross Carrying Value as on 1st April 2015 20.58 1.88 22.46 Additions 4.21 0.88 5.09 Deletions (1.90) 1.99 0.09 Gross Carrying Value as on 31st March 2016 22.89 4.75 27.64

Accumulated Depreciation as of 1st April 2015 14.18 0.12 14.30 Depreciation for the year 3.99 - 3.99 Adjustment - - - Accumulated Depreciation as of 31st March 2016 18.17 0.12 18.29 Carrying Value as on 31st March 2016 4.72 4.63 9.34 Carrying Value as on 1st April 2015 6.40 1.76 8.15

NOtE 6: INVEStMENtSParticulars Face Value As at

31.03.2017 As at

31.03.2016 As at

01.04.2015 Investments in equity instruments Blue Star Ltd. (31 March 2017: 392) (31 March 2016: 375) (01 April 2015: 375) 2 0.03 0.01 0.01 Castrol (India) Ltd. (31 March 2017: 20) (31 March 2016: 20) (01 April 2015: 20) 5 0.00 0.00 0.00 Chambal Fertilizers & Chem. Ltd. (31 March 2017: 1000) (31 March 2016: 1000) (01 April 2015: 1000)

10 0.01 0.01 0.01

DB International Stock Brokers Ltd (31 March 2017: 13000) (31 March 2016: 13000) (01 April 2015: 13000)

2 0.01 0.03 0.06

Dot Com. Global Ltd. (31 March 2017: 24200) (31 March 2016: 24200) (01 April 2015: 24200)

10 0.00 0.00 0.00

Shardul Securities Ltd. (31 March 2017: 25600) (31 March 2016: 25600) (01 April 2015: 25600)

10 0.11 0.11 0.11

ACE Edutrend Ltd. (31 March 2017: 16900) (31 March 2016: 16900) (01 April 2015: 16900) 10 0.00 0.00 0.00 Dion Global Solutions Ltd. (31 March 2017: 160) (31 March 2016: 160) (01 April 2015: 320)

10 0.00 0.00 0.00

Healthfore Technologies Ltd. (31 March 2017: 80) (31 March 2016: 80) (01 April 2015: 80) 10 0.00 0.00 0.00 Glaxosmithkline Pharmaceuticals Ltd. (31 March 2017: 125) (31 March 2016: 125) (01 April 2015: 125)

10 0.03 0.05 0.04

Contd....



(` In Crores)Particulars Face Value As at

31.03.2017 As at

31.03.2016 As at

01.04.2015

HDFC Bank Ltd. (31 March 2017: 125) (31 March 2016: 125) (01 April 2015: 125) 2 0.02 0.01 0.01 Hindustan Uniliver Ltd. (31 March 2017: 1350) (31 March 2016: 1350) (01 April 2015: 1350)

1 0.12 0.12 0.12

JSW Steel Ltd. (31 March 2017: 11240) (31 March 2016: 1124) (01 April 2015: 1124) 1 0.21 0.14 0.10 Lumax Industries Ltd. (31 March 2017: 4600) (31 March 2016: 4600) (01 April 2015: 4600) 10 0.63 0.19 0.15 Panasonic Energy India Co. Ltd. (31 March 2017: 500) (31 March 2016: 500) (01 April 2015: 500)

10 0.01 0.01 0.01

Pan India Corporation Ltd. (31 March 2017: 200) (31 March 2016: 200) (01 April 2015:200) 10 0.00 0.00 0.00 Sterlite Technologies Ltd. (31 March 2017: 525) (31 March 2016: 525) (01 April 2015: 525) 2 0.01 0.00 0.00 Subros Ltd. (31 March 2017: 150) (31 March 2016: 150) (01 April 2015: 150) 2 0.00 0.00 0.00 Tata Chemicals Ltd. (31 March 2017: 50) (31 March 2016: 50) (01 April 2015: 50) 10 0.00 0.00 0.00 Tata Consultancy Services Ltd. (31 March 2017: 832) (31 March 2016: 832) (01 April 2015: 832)

1 0.20 0.21 0.21

Visesh Infotecnics Ltd. (31 March 2017: 1100) (31 March 2016: 1100) (01 April 2015: 1100)

1 0.00 0.00 0.00

Voltas Ltd. (31 March 2017: 500) (31 March 2016: 500) (01 April 2015: 500) 1 0.02 0.01 0.01

GHCL Ltd. (31 March 2017: 15000) (31 March 2016: 15000) (01 April 2015: 125000) 10 0.40 0.17 0.77

Archies Ltd. (31 March 2017: 50000) (31 March 2016: 50000) (01 April 2015: 50000) 2 0.12 0.10 0.10

Investment in SBI Mutual Fund (31 March 2017: 100000) (31 March 2016: 100000) (01 April 2015: 100000)

0.13 0.09 0.10

2.08 1.29 1.84

Fedders Credits Ltd. (Formerly Lloyd Credits Ltd.) 10 0.30 0.30 0.30

Fedders Aircool Pvt. Ltd. (Formerly Lloyd Aircon Pvt. Ltd.) 10 0.00 0.00 0.00

Carrier Airconditioning & Refrigeration Ltd. (31 March 2017: 400) (31 March 2016: 400) (01 April 2015: 400)

10 0.00 0.00 0.00

0.30 0.30 0.30

Total 2.38 1.59 2.14

NOtE 7: LOANS


As at 31.03.2016

As at 01.04.2015

Unsecured, considered goodSecurity Deposits 2.80 3.24 2.76 Total 2.80 3.24 2.76


Other Bank Balance 0.21 0.23 0.33 Total 0.21 0.23 0.33

NOtE 9: OthER NON-CURRENt ASSEtS

Prepaid expenses - 0.01 0.02 Other Receivable - 0.14 1.27 Total - 0.14 1.29

NOtE 10: INVENtORIES

Raw materials 392.10 375.22 229.37 Stock in Progress 36.78 33.55 27.87 Finished Goods 525.59 471.66 460.57 Stock in Transit (at cost) 94.07 57.16 54.32 Stock for Resale 0.08 1.34 0.22 Total 1,048.63 938.93 772.34


151

NOtE 11: tRADE RECEIVABLES (` In Crores)


As at 31.03.2016

As at 01.04.2015

Trade Receivable - Considered Good 761.56 675.66 524.89

Less : Allowance for expected credit loss on trade receivables 1.71 1.44 1.15

Total 759.85 674.22 523.74

NOtE 12: CASh BANK BALANCES

Cash and cash equivalents

Balance with Banks-Current accounts 93.77 69.26 63.17

Cash in hand 0.27 0.46 0.32

Total 94.04 69.73 63.49

NOtE 13: BANK BALANCES

Unclaimed dividend accounts 0.22 0.27 0.25

Fixed Deposits 2.86 3.93 0.13

Receipt pledged with Bank for margin money (Including Interest) 1.15 0.78 0.78

Total 4.23 4.98 1.16

NOtE 14: LOANSUnsecured, considered good

Security Deposits 1.54 1.54 0.85

Total 1.54 1.54 0.85


Interest accrued on Fixed Deposit with Banks 0.03 0.02 0.04

Total 0.03 0.02 0.04

NOtE 16: OthER CURRENt ASSEtS

Advance to Vendor (Group Companies) 46.88 23.59 16.92

Prepaid expenses 25.55 17.45 15.95

Advances for capital goods 5.89 5.04 -

Balance with statutory/ govt. authorities 25.46 19.79 17.28

Insurance claim receivable - - 46.54

Non current assets held for sale - - 0.89

Advance recoverable in cash & kind or for value to be recovered 10.17 10.81 3.49

Advances to Employees & others 2.31 1.27 0.77

Other amounts recoverable 2.34 5.52 0.24

Total 118.60 83.47 102.09



NOtE 17: EQUItY ShARE CAPItAL (` In Crores)


As at 31.03.2016

As at 01.04.2015

1. Authorized Capital

7,00,00,000 Equity Share of Rs.10 each 70.00 70.00 70.00

(Previous year 7,00,00,000 Equity Share of Rs.10 each)

total Authorized Share Capital 70.00 70.00 70.00

2. Issued & Subscribed Capital

4,03,45,160 Equity Shares of Rs.10 each 40.35 36.22 35.33


3. Paid up Capital

4,03,32,260 Equity Shares of Rs.10 each fully paid up 40.33 36.21 35.32


Add:- Equity Shares forfeited (amount originally paid up)

0.01 0.01 0.01

Total 40.34 36.21 35.33

NOtES:-1. Out of the above Equity Shares a) Includes 40,00,000 Equity Shares alloted in the year 2006-07 upon conversion of warrants issued on preferential basis

during the year 2005-06 b) Includes 92,00,000 underlying Equity Shares representing 46,00,000 Global Depository Receipts issued during the year

2005-06 c) In the year 2006-07 the Company had forfeited 13,300 equity shares due to the non-payment of allotment money. The

Board of Directors had annulled the forfeiture of 400 Equity shares on receipt of payment advice by the shareholders and accordingly 400 Equity Shares had been restored back.

d) 43,20,000 Equity Shares of Rs. 10 each were alloted during the financial year 2013-14 in favour of shareholders of Perfect Radiators & Oil Coolers Pvt. Ltd. (PROC) on account of merger of PROC with the Company retrospectively since 01.04.2011.

e) Includes 8,85,000 equity shares alloted to Promoter Group Entities on January 29, 2016, upon conversion of equivalent number of warrants issued on preferential basis.

f) Includes 17,00,000 equity shares alloted to Promoter Group Entities on September 03, 2016 and 24,27,000 equity shares on September 08, 2016, upon conversion of equivalent number of warrants issued on preferential basis.

(a) Reconciliation of the shares outstanding at the beginning and at the end of the reporting period

Particulars 31 March, 2017 31 March, 2016 1 April, 2015 No. of Shares



Amount

Equity SharesShares outstanding at the beginning of the year 36,205,260 36.21 35,320,260 35.32 35,320,260 35.32 Shares Issued during the year 4,127,000 4.13 885,000 0.89 - - Shares outstanding at the End of the year 40,332,260 40.33 36,205,260 36.21 35,320,260 35.32

(b) terms/rights attached to equity shares

The Company has only one class of equity shares having par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.


153

(c) Details of shareholders holding more than 5% shares in the Company

(` In Crores)

Particulars 31 March, 2017 31 March, 2016 1 April , 2015No. of Shares

% of holding

No. of Shares

% of holding

No. of Shares

% of holding

Equity Shares of Rs. 10 each fully paid-upPSL Engineering Pvt. Ltd. 3,713,520 9.21 3,713,520 10.26 3,713,520 10.51Fedders Sales Pvt. Ltd. (Formerly Lloyd Sales Pvt. Ltd.)

3,315,005 8.22 3,315,005 9.16 3,315,005 9.39

Airserco Pvt. Ltd. 3,304,133 8.20 3,304,133 9.13 3,304,133 9.35Fedders Manufacturing Pvt. Ltd. (Formerly Lloyd Manufacturing Pvt. Ltd.)

2,253,416 5.59 1,653,416 4.57 1,653,416 4.68

As per the records of the company, including its register of shareholders/members and other declaration received from the shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownerships of shares.

(d) Share Warrants (Pending Allotments)


As at 31.03.2016

As at 01.04.2015

25% Upfront Payment - 19.44 22.80 Total - 19.44 22.80

Money received against Share Warrants represents amounts received towards warrants which entitles the warrant holders, the option to apply for and be alloted equivalent number of equity shares of the face value of Rs.10 Each.

During the year 2014-15, the Company has issued to its Promoter Group Entities 60 Lac warrants at a price of Rs.152 each entitling them for subscription of equivalent number of Equity Shares of Rs.10 each (including premium of Rs.142 each share) in accordance with Chapter VII of SEBI (Issue of Capital & Disclosure Requirments) Regulations, 2009.

During the previous year, allottees of 8.85 Lac warrants have exercised their right to convert the warrants into equity shares by paying balance 75% of the consideration aggregating Rs.10.09 Crores and consequently 8.85 Lac equity shares were issued to them.

During the financial year, the Company has issued and allotted 17 Lac equity shares of Rs. 10 each at a premium of Rs.142 each on 3rd September, 2016 and 24.27 Lac equity shares of Rs.10 each at a premium of Rs.142 each on 8th September, 2016 to promoter group entities on preferential basis upon conversion of equivalent number of warrants.

Further, the promoter group entities have shown their inability to exercise their right to convert the balance 9.88 lacs warrants which are required to be converted into equity shares on or before 12th September, 2016 as conversion of such number of warrants would have increased their shareholding beyond the permissible creeping limit of 5% in a financial year as stipulated in Regulation 3(2) of the SEBI (Substantial Acquisition of Shares & Takeovers) Regulations, 2011. Accordingly, 9.88 lacs warrants stand cancelled and the upfront subscription money aggregating to Rs.3.75 Crores received on said warrants at the time of their subscription was forfeited. Consequent upon the above allotments and forfeiture of warrants, there were no pending warrants due for conversion as on 31st March, 2017.

NOtE 18: OthER EQUItY


As at 31.03.2016

As at 01.04.2015

1. Equity Component-Share Warrant - 19.44 22.80 2. Capital Reserve 15.00 11.25 11.25 3. Revaluation Reserve net of tax 0.23 0.23 0.23 4. Securities Premium Account 270.24 211.64 199.07 5. Statutory Reserve 1.80 1.95 1.70 6. General Reserve 247.72 217.72 202.72 7. Retained Earnings 321.63 287.30 277.63 8. Other Comprehensive Income 0.95 0.60 (0.53)9. Currency Exchange Difference 2.50 (3.22) 7.97 Total 860.07 746.91 722.83



(` In Crores)


As at 31.03.2016

1. Equity Component-Share Warrant - 19.44

2. Capital Reserve 11.25 11.25

Add: Share warrant forfeited 3.75 -

15.00 11.25

3. Revaluation Reserve net of tax (Land Revalued as on 31st March 1993) 0.23 0.23

4. Securities Premium Account 211.64 199.07

Addition Premium Amount from conversion of Warrants 58.60 12.57

270.24 211.64

5. Statutory Reserve 1.95 1.70

Addition Amount (0.15) 0.25

1.80 1.95

6. general Reserve

Opening Balance 217.72 202.72

Add: Transfer from Profit & Loss Account 30.00 15.00

247.72 217.72

7. Retained Earnings

Opening Balance 287.30 277.63

Profit for the year 69.99 41.70

Mat Credit Adjustment for Previous Year - (11.09)

Sale of Investment through OCI - (0.42)

Dividend Paid (including tax on dividend) (5.66) (5.51)

Transfer to General Reserve (30.00) (15.00)

321.63 287.30

8. Other Comprehensive Income:

Remeasurement of Retirement Benefit (0.44) (0.44)

Fair Value of Investment

Opening Balance 0.60 (0.53)

Addition during the year 0.79 0.71

Transfer retained earning on sale - 0.42

0.95 0.60

9. Currency Exchange Difference

Opening Balance (3.22) 7.97

Addition during the year 5.72 (11.19)

2.50 (3.22)

Total 860.07 746.91

NOtE 19: BORROWINgS (` In Crores)


As at 31.03.2016

As at 01.04.2015

Secured

Term Loans (Indian Currency)

From banks 51.00 89.91 106.19

Total 51.00 89.91 106.19

Contd....


155

Note:-

1. Indian rupee loan for Rs. 35.00 Crores from IDBI Ltd. carries interest @ 12.25% p.a. on Rs.17.50 Crores and @ 11.50% p.a. on Rs.17.50 Crores. The Loan is repayable in 16 quarterly installment of Rs. 2.19 crores each after monotorium of 12 Months from the date of loan i.e. 31st March, 2013. The Company has taken disbursement of Rs.31.50 Crores.

2. Indian rupee loan for Rs.120.00 Crores from SBI carriers interest @ 11.00% p.a. The Loan is repayable in 24 quarterly installment of Rs. 5.00 crores each after monotorium of 12 Months from the date of loan i.e. 30.06.2013.

3. Indian rupees loan for Rs.20.00 Crores from SBBJ carries interest @ 12% p.a. The Loan is repayable in 16 Quarterly installment of Rs. 1.25 Crores each after monotorium of 9 Months from the date of Loan i.e. 01.09.2015.

4. The above loans are secured by way of first charge on Pari-Passu basis on the fixed assets of the Company and second hypothecation charge on the Stock/Book Debts.

NOtE 20: LONg tERM PROVISIONS (` In Crores)


As at 31.03.2016

As at 01.04.2015

Gratuity 7.21 2.91 3.08

Total 7.21 2.91 3.08

NOtE 21: DEFERRED tAx LIABILItIES (NEt)

Deferred tax liabilities on account of: 5.24 8.72 9.32

Due to Depreciation 5.24 8.72 9.32

Deferred tax assets on account of:

Provisions for employee benefits 0.61 (0.13) (0.21)

0.61 (0.13) (0.21)

Total 4.63 8.86 9.53

NOtE 22: BORROWINgS

Secured

Working Capital from Banks 1,080.64 966.69 743.37

Total 1,080.64 966.69 743.37

The working capital loans, fund based as well as non-fund based are secured by way of first hypothecation charge on the stocks/ book debts, both present and future and second charge on pari-passu basis on the fixed assets of the company. This includes working capital loan in the form of Cash Credit Limit, Working Capital Demand Loan, Bill Discounted and Buyer’s Credit etc.

NOtE 23: tRADE PAYABLES

Others 185.51 178.13 148.02

Total 185.51 178.13 148.02

NOtE 24: OthER FINANCIAL LIABILItIES

Current maturities of long-term debt;

Foreign Currency Loans - - 25.38

Term Loans 28.28 38.75 28.75

Loan Against Vehicles 1.15 1.69 1.24

Contd....



(` In Crores)


As at 31.03.2016

As at 01.04.2015

Interest accrued but not due on borrowings 0.45 0.61 1.58

Unpaid Dividend 0.31 0.27 0.25

Other Expenses Payables 29.17 25.87 4.54

Derivative Liabilities 1.55 0.28 -

Total 60.91 67.47 61.74

NOtE 25: OthER CURRENt LIABILItIES

Due to Statutory Bodies 57.98 48.96 31.61

Other Liability 68.27 44.53 25.24

Advance from Customer 1.51 5.67 0.74

Total 127.75 99.16 57.59

NOtE 26: ShORt tERM PROVISIONS

Leave Encashment 1.18 4.80 5.11

Other Provision 4.68 - -

Provision for warranty 5.18 5.08 -

11.04 9.88 5.11

NOtE 27: REVENUE FROM OPERAtION(` In Crores)



Sale of products

Gross Sale/Income from Operations 3,358.25 2,766.26

Less: Schemes & Discounts - 46.88

3,358.25 2,719.38

Other Operating Revenues

Other Operating Revenues 8.61 0.94

Total 3,366.85 2,720.32

NOtE 28: OthER INCOME

Dividend Received 0.02 0.05

Interest Income 0.62 0.14

Interest Income on Financial Assets at amortisation cost 0.15 0.10

Gain on Sale on Fixed Assets 0.07 0.09

Income from Scrap 6.40 6.94

Miscellaneous Income 1.67 1.78

Total 8.93 9.09


157

NOtE 29: COSt OF MAtERIAL CONSUMED(` In Crores)



raw Material

Opening stock 375.22 233.41

Purchases 2,379.99 1,997.16

Carriage Inwards 43.01 59.28

2,798.22 2,289.86

Less: Closing stock 392.10 375.22

Total 2,406.12 1,914.64

NOtE 30: PURChASE OF StOCK IN tRADE

Other consumer goods 270.13 142.74

Total 270.13 142.74

NOtE 31: ChANgE IN INVENtORY

Opening stock



505.22 488.48

Closing stock



562.37 505.22

(57.16) (16.74)

NOtE 32: EMPLOYEE BENEFIt ExPENSE

Salaries and wages 152.51 123.31

Contribution to Provident and other funds 4.00 3.46

Social Security and Health Insurance Expenses 18.15 18.18

Staff Welfare 4.11 3.60

Total 178.78 148.54

NOtE 33: FINANCE COSt

Interest 100.04 87.31

Bank Charges 19.91 18.83

Total 119.95 106.15



NOtE 34: DEPRECIAtION AND AMORtIzAtION ExPENSE (` In Crores)



Depreciation on Tangible Assets 44.29 41.37

Amortization of Intangible Assets 4.67 3.99

Total 48.95 45.35

NOtE 35: OthER ExPENSES

Power & Fuel 10.02 7.01

Repairs & Maintenance -

- Machinery 5.81 6.29

- Building & Office 1.31 1.43

Insurance 4.30 2.60

Rates & Taxes 11.48 10.65

Lease Charges 7.26 5.60

Travelling & Conveyance 11.91 9.06

Service Contract Charges/ Installations/ Warranty 17.87 11.36

Motor Car Expenses 1.06 0.42

Communication Expenses 5.64 4.60

Factory Overheads 29.10 22.74

Auditor's Remuneration (including Cost audit fee) 0.78 0.68

Foreign Exchange Fluctuations 2.45 31.14

Bad Debt & Provision 0.01 0.07

Donation 1.36 0.34

Octroi & Carriage Outwards 30.45 23.24

Business Promotion 12.86 7.41

Advertising and sales promotion 86.68 53.59

Printing & Stationery 1.01 0.87

Legal & Professional 11.46 7.09

Loss on Sale of Fixed Assets 0.08 0.10

Life time credit risk on Trade receivables 0.27 0.30

Fair vale loss on Financial Assets 0.04 0.12

Miscellaneous Expenses 6.41 19.46

Total 259.61 226.16


159

CONSOLIDATED NOTES TO ACCOuNTS36. Contingent liability not provided for (` In Crores)


As at 31.03.2016

As at 01.04.2015

A. Claims against the company / disputed liabilities not acknowledged as debts*

a. HP State Electricity Board 0.11 0.11 0.11

b. Central Excise & Customs Matters* 3.31 3.53 0.22

c. Sale Tax Matters Nil Nil 0.84

d. Income Tax Matters (Pending Rectifications) 2.95 3.50 Nil

B. Guarantees

i) Bank Guarantees 24.56 8.59 5.95

ii) Stand by Line of Credit of Euro 3.785 million from IndusInd Bank Limited given by the Company for Euro 4.00 million Term Loan facilities availed by Lloyd Coils Europe s.r.o. a wholly owned subsidiary from SBI Paris (Euro 2.89 million as at March 31, 2015.)

NIL NIL 19.51

iii) Stand by Line of Credit of Euro 1.25 Million from Standard Chartered Bank given by the company for Euro 1 million working capital facilities availed by Janka Engineering s.r.o. a wholly owned subsidiary from Komercni Bank Czech Republic. (Euro 1.25 million as at March 31, 2015.)

NIL NIL 8.44

iv) Corporate Guarantee of Euro 3 Million issued by the Company in favour of GE Money Bank, a.s. for credit facility availed by Lloyd Coils Europe s.r.o.

NIL 20.25 20.25

v) Unconditional and irrevocable Corporate Guarantee of AUD 6 Million in favour M/s Bombardier Transportation (v/Line) Australia Pty Ltd. (“Bombardier”). This guarantee is issued as a security for the performance of the agreement executed by Noske Kaeser Rail & Vehicles New Zealand Limited (WOS) with the Bombardier for the manufacture and supply of equipments by the WOS.

29.72 NIL NIL

vi) Unconditional and irrevocable Performance Guarantee of NZD 3.8 million in favour of M/s Downer EDI Rail Pty Limited (“Downer). This guarantee is issued as a security for the performance of the agreement executed by Noske Kaeser Rail & Vehicles New Zealand Limited (WOS) with the Downer for the supply of air conditioner equipment and services by the WOS.

17.25 NIL NIL

*During the previous financial year the Company has received total demand of Rs. 46.23 Cr. under show cause notices from custom department. The Company has made suitable reply of the same. Since there is no confirm demand, hence no provision is required.

37.

Contracts remaining to be executedOn capital account and not provided for

NIL NIL NIL

38. Micro and Small Scale Business Entities

This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company. Accordingly, there were no interest due on the principal amount, not there was necessity to pay interest for delayed payment in terms of section 16 of the Micro, Small and Medium Enterprises Development Act.



39. Disclosure as per regulation 34 (3) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015

a) Loan given to Subsidiary and outstanding (` In Crores)




Lloyd Coils Europe s.r.o. Czech Republic Subsidiary 6.02 7.72 NilNoske-Kaeser Rail & Vehicles, Germany GmbH Subsidiary 4.09 3.06 Nil

b) Loan taken from Subsidiary and payable (` In Crores)




Lloyd Coils Europe s.r.o. Subsidiary NIL 20.99 20.99

40. Related Party Disclosures: (in which some Directors are interested)

A. Names of related parties and related party relationships

i. Wholly Owned Subsidiaries: a. Lloyd Coils Europe s.r.o. Czech Republic b. Janka Engineering s.r.o. Czech Republic c. Noske Kaeser Rail & Vehicle Germany GmbH d. Noske Kaeser US Rail & Vehicle LLC e. Noske Kaeser Rail & Vehicles New Zealand Limited (“NK NZ”) f. Noske-Kaeser Rail & Vehicle Australia Pty Ltd (Indirect wholly owned subsidiary through NK NZ) g. Noske-Kaeser Empreendimentos e Participaçôes do Brasil Ltd. (Indirect wholly owned subsidiary through NK NZ)

ii. List of Key management personnel: a. Mr. Brij Raj Punj Chairman and Managing Director b. Mr. Bharat Raj Punj Deputy Managing Director c. Mr. Achin Kumar Roy Whole Time Director d. Mr. Mukat B. Sharma Whole Time Director and Chief Financial Officer e. Mr. Nipun Singhal Whole Time Director (Resigned w.e.f. 8th May, 2017)

iii. Enterprises owned or significantly influenced by key management personnel or their relatives: a. Fedders Electric & Engineering Ltd. (Formerly Fedders Lloyd Corporation Ltd.) b. Fedders Lloyd Trading FZE c. Airserco Pvt. Ltd. d. Perfect Radiators & Oil Coolers Pvt. Ltd. e. PSL Engineering Pvt. Ltd. f. Regal Information Technology Pvt. Ltd. g. Fedders Aircool Pvt. Ltd. (Formerly Lloyd Aircon Pvt. Ltd.) h. Fedders Credits Ltd. (Formerly Lloyd Credits Ltd.) i. Fedders IT Technology Pvt. Ltd. (Formerly Lloyd IT Technology Pvt. Ltd.). j. Fedders Sales Pvt. Ltd. (Formerly Lloyd Sales Pvt. Ltd.) k. Fedders Manufacturing Pvt. Ltd. (Formerly Lloyd Manufacturing Pvt. Ltd.) l. Fedders Infotech (India) Pvt. Ltd. (Formerly Lloyd Infotech (India) Pvt. Ltd.) m. Fedders Stock & Investments Pvt. Ltd. (Formerly Lloyd Stock & Investments Pvt. Ltd.) n. Himalayan Mineral Waters Pvt. Ltd. o. Punj Engineering Pvt. Ltd. p. Punj Services Pvt. Ltd. q. Pandit Kanahaya Lal Punj Pvt. Ltd. r. PSL Wolfe JV Pvt. Ltd. s. Pandit Kanahaya Lal Punj Trust t. Brij Raj Punj(HUF)


161

B. transactions during the period with Related Parties are as under: (` In Crores)

Name of Related Party 2016-17 2015-16

Fedders Electric & Engineering Ltd. (Formerly Fedders Lloyd Corporation Ltd.)Sales of Goods 11.66 10.61Purchase of Goods 57.40 39.76Security Deposit 26.42 16.92Fedders Infotech (India) Pvt. Ltd. (Formerly Lloyd Infotech (India) Pvt. Ltd.)Services Received 39.64 14.01 Fedders Manufacturing Pvt. Ltd. (Formerly Lloyd Manufacturing Pvt. Ltd.)Money received against Share Warrants 6.84 NILPerfect Radiators and Oil Coolers Pvt. Ltd.Money received against Share Warrants 4.56 2.00Rent Paid 1.09 NilSecurity Deposit 8.08 NilPandit Kanahaya Lal Punj Pvt. Ltd.Money received against Share Warrants 10.98 3.99Rent Paid 0.53 0.47Security Deposit 5.36 3.36himalayan Mineral Waters Pvt. Ltd.Money received against Share Warrants 13.26 1.82Security Deposit 3.06 1.56Fedders Stock & Investment Pvt. Ltd. (Formerly Lloyd Stock & Investment Pvt. Ltd.)Money received against Share Warrants 6.84 NILFedders Credits Ltd. (Formerly Lloyd Credits Ltd.)Money received against Share Warrants 4.56 2.28Pandit Kanahaya Lal Punj trustDonation 1.36 0.34Fedders Aircool Pvt. Ltd. (Formerly Lloyd Aircon Pvt. Ltd)Security Deposits 3.95 1.75Subsidiary CompaniesLloyd Coils Europe s.r.o.Purchase of Goods 1.15 0.06Interest paid on Loan taken 0.17 0.87Loan given during the year NIL 7.72Interest Receivables on Loan given 0.53 0.18Janka Engineering s.r.o.Purchase of Goods 0.16 0.01Sale of Goods NIL 0.05Exhibition Expenses NIL NILOthers NIL NILNoske-Kaeser Rail & Vehicle germany gmbhLoan given during the year 1.04 3.06Interest Receivables on Loan given 0.28 0.00Noske Kaeser Rail & Vehicles New zealand LimitedPurchase of Goods 0.92 0.00Key Management PersonnelManagerial Remuneration Paid-Mr. Brij Raj Punj 0.78 0.72-Mr. Bharat Raj Punj 0.63 0.58-Mr. Achin Kumar Roy 1.66 1.10-Mr. Mukat B. Sharma 0.49 0.45-Mr. Nipun Singhal 1.05 1.04



41. ADDITIONAL INFOrMATION

Basic & Diluted Earnings per Share: Earnings per share have been computed as under:(` In Crores)

Particulars 2016-17 2015-16Profit after Taxation 70.34 42.41Number of Equity Shares 40,332,260 36,205,260Basic Earnings Per Share (Face Value Rs.10 per share)

17.44 11.71

Diluted Earnings Per Share (Face Value Rs.10 per Share)

17.44 10.26*

*Assuming full conversion of remaining 51,15,000 convertible warrants issued on 13.03.2015 on preferential basis as per SEBI (ICDR) Regulations, 2009

42. SEgMENt INFORMAtION

A. Primary Segment Reporting (Business Segment)

During the year the Company had following Business segments as its primary reportable segments

a. Consumer Durables (please refer note 46) b. OEM & Packaged Air-conditioning c. Heat Exchangers & Components

Segment Revenues, Results and Other Information:

Particulars 2016-17 2015-16I. Segment Revenue

i. Consumer Durables 1885.46 1337.19ii. OEM & Packaged Air-conditioning 936.01 879.78iii. Heat Exchangers & Components 603.93 611.01iv. Wholly Owned subsidiaries 344.42 332.69

Sub:- total (i+ii+iii) 3769.82 3160.67Less:- Inter Segment Revenue 411.58 441.29Net Sales/Income from Operations 3358.24 2719.38II. Segment Results

(PROFIT (+)/LOSS(-))i. Consumer Durables 120.94 105.65ii. OEM & Packaged Air-conditioning 59.74 50.15iii. Heat Exchangers & Components 66.09 81.77iv. Wholly Owned subsidiaries (13.63) (13.84)

Sub:- total (i+ii+iii) 233.14 223.73Less:- i. Finance Cost 119.95 106.15

ii. Other un-allocable expenditure net of un-allocable Income 8.91 7.00iii. Exceptional Items - 45.80

Operating Profit before tax 104.28 64.78III. Segment Assets* - -IV. Segment Liabilities* - -

*As certain assets of the Company including manufacturing facilities are often deployed interchangeably across segments, it is impractical to allocate these assets and liabilities segment wise.

B. Information pertaining to geographical Segment:

Sale of products

Particulars 2016-17 2015-16Within India 2,903.22 2,296.18Outside India 455.02 423.20Total 3,358.24 2,719.38


163

Fixed Assets as per geographical Locations

The Company has common fixed assets, other assets and liabilities for domestic as well as overseas market. Hence, separate figures for assets and liabilities have not been furnished.

43. Capital Management

For the purposes of Company’s capital management, Capital includes equity attributable to the equity holders of the Company and all other equity reserves. The Company manages its capital to ensure that the company will be able to continue as going concerns while maximizing the return to stakeholders through the optimization of the debt and equity balance. The capital structure of the Company consists of net debt (borrowings offset by cash and bank balances) and total equity of the company. The Company reviews the capital structure of the Company on a semi-annual basis. As part of this review, the company considers the cost of capital and the risks associated with each class of capital. The Company monitors capital using gearing ratio, which is net debt divided by total capital plus net debt.

(` In Crores)


As at 31.03.2016

As at 01.04.2015

Debt 1,161.06 1,097.04 904.93

Cash and bank balances 94.04 69.73 63.49

Net debt 1,067.02 1,027.31 841.44

Total equity 900.41 783.12 758.16

Equity and net debt 1,967.43 1,810.43 1,599.60

gearing ratio (Net Debt/Capital and Net Debt) 54.23% 56.74% 52.60%

44. FINANCIAL INSTruMENTS

a) Financial instruments by category

Financial Assets As at 31.03.2017

As at 31.03.2016

As at 01.04.2015


a) cash and cash equivalent including bank balance 98.27 74.71 64.65

b) Loan 4.35 4.78 3.60

c) Other financial assets 0.23 0.25 0.37

d) Trade receivable 759.85 674.22 523.74

Fair value through Other Compressive Income

Investment in equity Instrument 2.38 1.59 2.14

Total 865.08 755.55 594.50

Financial liabilities


a) Borrowing 80.42 130.36 161.56

b) Short term borrowing 1,080.64 966.69 743.37

c) Trade payable 185.51 178.13 148.02

d) Other financial liability 29.93 26.74 6.37

Sub total 1,376.50 1,301.92 1,059.32

Fair value through profit and loss

Forward contracts 1.55 0.28 -

Total 1,378.05 1,302.20 1,059.32



b) Fair value measurement of financial assets and financial liabilities(` In Crores)

Particulars Fair value as at Fair value hierarchy

Valuation technique(s) and key input(s)

As at 31.03.2017

As at 31.03.2016

As at 01.04.2015

Financial Assets

Security deposit 2.80 3.24 2.76 Level 2 Discounted cash flow at a discount rate that reflects the company's current borrowings rate at the end of reporting period.

Investment in equity

2.38 1.59 2.14 Level 1 Based on quoted market price in active markets.


Borrowing 80.42 130.36 161.56 Level 2 Discounted estimated cash flow through the expected life of the borrowings.

Forward contracts 1.55 0.28 - Level 1 Based on quoted price for similar assets and liabilities in active markets.

c) the fair values of current debtors, bank balances, current creditors and current borrowings are assumed to approximate their carrying amounts due to the short-term maturities of these assets and liabilities.

(` In Crores)

Particulars Carrying value

As at 31.03.2017

As at 31.03.2016

As at 01.04.2015

i) Financial assets - Current

Trade receivables 759.85 674.21 523.74

Cash and Bank balances 98.27 74.71 64.65

Loans 1.54 1.54 0.85

Other Financial assets 0.03 0.02 0.04

ii) Financial liabilities - Current

Trade payables 185.51 178.13 148.02

Other Financial liabilities (other than current maturity of long term borrowings)

31.48 27.03 6.37

45. Financial risk management objectives and policies

The Company’s principal financial liabilities, other than derivatives, comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include loans, trade and other receivables and cash and cash equivalents that are derived directly from its operations.

The Company’s financial risk management is an integral part of how to plan and execute its business strategies. The Company is exposed to market risk, credit risk and liquidity risk. The company’s focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.

The Board of Directors reviews and agrees policies for managing each of these risks which are summarized as below :

a) Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency rate risk, interest rate risk and other price risks, such as equity price risk and commodity price risk.


165

i) Currency rate risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the Company’s operating activities (when revenue or expense is denominated in foreign currency). The Company holds derivative financial instruments such as foreign exchange forward and option contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The exchange rate between the rupee and foreign currencies has changed substantially in recent years and may fluctuate substantially in the future. Consequently, the results of the Company’s operations are adversely affected as the rupee appreciates/ depreciates against these currencies.

Derivative financial instruments

The Company holds derivative financial instruments such as foreign currency forward and option contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The counter party for these contracts is generally a bank or a financial institution. These derivative financial instruments are valued based on quoted prices for similar assets and liabilities in active markets or inputs that are directly or indirectly observable in the marketplace.

Nominal amount of derivative contracts entered into by the Company and outstanding as on 31st March, 2017 is Rs.72.37 Crores (Previous year Rs.7.58 Crores) Category wise breakup is given below:

(` In Crores)

S. No. Particulars As at March 31, 2017


1. Forward Contract 72.37 7.58

2. Currency Swap NIL NIL

3. Interest Rate Swap NIL NIL

4 Option NIL NIL

ii) Interest rate risk

Interest rate is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s long term debt obligation at floating interest rates. The Company’s borrowings outstanding as at March 31, 2017 comprise of fixed rate loans and accordingly, are not expose to risk of fluctuation in market interest rate.

iii) Commodity price risk

The Company is affected by the price volatility of certain commodities. Its operating activities require the ongoing manufacture of industrial and domestic air conditioners and therefore require a continuous supply of copper and Aluminium being the major input used in the manufacturing. Due to the significantly increased volatility of the price of the Copper and aluminium, the Company has entered into various purchase contracts for these material for which there is an active market. The Company’s Board of Directors has developed and enacted a risk management strategy regarding commodity price risk and its mitigation. The Company partly mitigated the risk of price volatility by entering into the contract for the purchase of these material based on average price of for each month.

b) Credit Risk

Credit Risk is the risk that the counter party will not meet its obligation under a financial instrument or customer contract, leading to a financial loss. The maximum exposure to the credit risk at the reporting date is primarily from trade receivables. Trade receivables are typically unsecured and are derived from revenue earned from customers.

Customer credit risk is managed subject to the Company’s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on an extensive credit rating score card and individual credit limits are defined in accordance with this assessment.



trade receivables may be analyzed as follows:(` In Crores)

Age of receivables As at 31.03.2017

As at 31.03.2016

As at 01.04.2015

0-90 days past due 563.55 408.77 377.92

90-180 days past due 190.39 256.76 136.47

More than 180 days past due 7.62 10.13 10.50

Sub Total 761.56 675.66 524.89

Less: Allowance for expected Credit Loss on Trade Receivable 1.71 1.44 1.15

Total 759.85 674.22 523.74

An impairment analysis is performed at each reporting date on trade receivables by lifetime expected credit loss method based on provision matrix.

Remeasurement (gain)/ loss recognized in other comprehensive income(` In Crores)

Movement in the expected credit loss allowance As at 31.03.2017

As at 31.03.2016

Balance at beginning of the year 1.44 1.15

Movement in expected credit loss allowance on trade receivables calculated at lifetime expected credit losses

0.27 0.29

Balance at end of the year 1.71 1.44

c) Liquidity Risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time. The Company’s objective is to at all times maintain optimum levels of liquidity to meet its cash and liquidity requirements. The Company closely monitors its liquidity position and deploys a robust cash management system. It maintains adequate source of financing through the use of short term bank deposits and cash credit facility. Processes and policies related to such risks are overseen by senior management. Management monitors the Company’s liquidity position through rolling forecasts on the basis of expected cash flows. The Company assessed the concentration of risk with respect to its debt and concluded it to be low.

The following tables detail the Company’s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the company can be required to pay.

(` In Crores)




Borrowings 11.29% 29.43 52.00 81.43 80.42

Short term borrowings 1,080.64 - 1,080.64 1,080.64

Trade payable 185.51 - 185.51 185.51


Total 1,327.06 52.00 1,379.06 1,378.05

Contd....


167

(` In Crores)



As at March 31, 2016Borrowings 11.29% 40.44 91.64 132.08 130.36Short term borrowings 966.69 - 966.69 966.69Trade payable 178.13 - 178.13 178.13 Other financial liabilities 27.03 - 27.03 27.03 Total 1,212.29 91.64 1,303.93 1,302.21



As at 1 April, 2015Borrowings 11.29% 55.37 108.55 163.92 161.56Short term borrowings 743.37 - 743.37 743.37Trade payable 148.02 - 148.02 148.02Other financial liabilities 6.37 - 6.37 6.37Total 953.13 108.55 1,061.68 1,059.32

46. Events occurring after balance sheet date

The Company has sold its Consumer Durable Business comprising of business of importing, trading, marketing, exporting, distribution, sale of air conditioners, televisions, washing machines and other household appliances and assembling of televisions under the brand “LLOYD” and all of the rights, title, interest and assets, licenses, continuing employees of the said business, intellectual property including the brand, logo, trade mark “LLOYD” as a going concern on slump sale basis to Havells India Ltd. on May 08, 2017 at an enterprise value of Rs.1,550 Crores on a debt free cash free basis.

With effect from the closing date all assets/interest/rights etc. including continuing employees of the consumer durable business got transferred to Havells India Ltd. pursuant to the agreement entered with it.

The sale of the consumer durable business will not have any impact on the Company’s existing B2B air conditioning business as the Company has not sold any of its manufacturing facility as the part of the aforesaid transaction and the Company shall continue with its existing business of manufacturing of air conditioners as OEM suppliers for other brands, packaged air conditioning for railways and heat exchanger business, which are its core competencies.


47. Dividend Paid and Proposed(` In Crores)

Particulars 31.03.17 31.03.16Dividend declared and paid during the year:Final Dividend paid 4.71 4.59Corporate Dividend Tax on Final Dividend 0.96 0.92

5.67 5.51Proposed Dividends on equity shares:Special dividend (One time dividend) 80.66 0.00Corporate Dividend Tax on Special dividend 16.42 0.00Final Dividend for the year ended March 31, 2017 6.05 4.71Corporate Dividend Tax on Proposed Dividend 1.23 0.96

104.36 5.67



48. During the year, the Company had specified bank notes or other denomination note as defined in the MCA notification G.S.R. 308(E) dated 31st March, 2017 on the details of Specified Bank Notes (SBN) held and transacted during the period from 8th November, 2016 to 30th December, 2016, the denomination wise SBNs and other notes as per the notification is given below.

(` In Crores)

Particulars SBNs ODNs TotalClosing cash on hand as on 08 Nov 2016 0.29 0.24 0.53(+) Permitted receipts - 0.26 0.26(-) Permitted payments - 0.26 0.26(-) Amounts Deposited in Banks 0.29 0.00 0.29Closing cash on hand as on 30 Dec 2016 0.00 0.24 0.24

49. Income tax Income tax Expense in the Statement of Profit and Loss Comprises

(` In Crores)

Particulars 31.03.17 31.03.16Current Income Tax Charge 36.92 17.64 MAT Credit Adjustment - 6.94 Deferred TaxRelating to origination and reversal of temporary differences (2.63) (1.51)Income tax Expense reported in the statement of profit & loss 34.29 23.07 Other Comprehensive IncomeRe-measurement (gains)/losses on defined benefit plan 0.23 - Income tax related to items recognized in OCI during the year 0.23 -

50. Disclosures as required by Indian Accounting Standard (IND AS 101) first time adoption of Indian Accounting Standard:

These are Company’s first financial statements prepared in accordance with IND AS. The accounting policies set out in Note 2 have been applied in preparing the financial statements for the year ended 31st March, 2017, the comparative information presented in these financial statements for the year ended 31st March, 2016 and in the preparation of an opening Ind As balance sheet as at 1st April, 2015 (the Company’s date of transition). In preparing its opening IND AS balance sheet, the company has adjusted the amounts reported previously in financial statements prepared in accordance with accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (Indian GAAP). An explanation of how the transition from previous GAAP to IND AS has affected the financial position & financial statements is set out in following notes.

A) Reconciliations of Balance Sheet as at 31st March 2016 and 1st April 2015(` In Crores)

Particulars ref As at 31 March 2016 As at 1 April 2015Previous

gAAPgAAP

AdjustmentsAs per IND AS

Previous gAAP

gAAPAdjustments

As per IND AS

ASSETS Non-Current assets Property, Plant and Equipment j 411.83 - 411.83 402.30 (0.89) 401.41 Capital Work in Progress 6.70 - 6.70 7.69 - 7.69 Other Intangible Assets 9.34 - 9.34 8.15 - 8.15 Financial Assets (i)Investments c,g 4.15 (2.56) 1.59 2.14 (0.01) 2.13 (ii) Loans b 3.90 (0.66) 3.24 3.40 (0.64) 2.76 (iii) Other Financial assets 0.23 - 0.23 0.33 - 0.33 Other Non Current Assets b 0.14 0.01 0.15 5.46 (4.17) 1.29 436.29 (3.21) 433.08 429.47 (5.71) 423.76 Current Assets Inventories 938.93 - 938.93 772.34 - 772.34

Contd...


169

(` In Crores)Particulars ref As at 31 March 2016 As at 1 April 2015

Previous gAAP

gAAP Adjustments

As per IND AS

Previous gAAP

gAAPAdjustments

As per IND AS

Financial Assets (i) Trade Receivables d 675.66 (1.44) 674.22 524.89 (1.15) 523.74 (ii) Cash and Cash equivalents 69.73 - 69.73 63.49 - 63.49 (iii) Bank balance other than (ii) above 4.98 - 4.98 1.16 - 1.16 (iv) Loans 1.54 - 1.54 0.85 - 0.85 (v) Other Financial assets 0.02 - 0.02 0.04 - 0.04 Current Tax Assets (Net) 15.79 - 15.79 24.41 - 24.41 Other Current Assets j,b 83.46 0.01 83.47 101.18 0.91 102.09 1,790.11 (1.43) 1,788.68 1,488.36 (0.24) 1,488.12 Total 2,226.40 (4.64) 2,221.76 1,917.83 (5.95) 1,911.88

EQUItY AND LIABILItIES Equity Equity Share Capital 36.21 - 36.21 35.33 - 35.33 Other Equity 744.70 2.21 746.91 721.25 1.58 722.83 780.91 2.21 783.12 756.58 1.58 758.16 Non Current Liabilities

Financial Liabilities (i) Borrowings a 91.64 (1.73) 89.91 108.55 (2.35) 106.20 Provisions 2.90 - 2.90 3.08 - 3.08 Deffered Tax Liabilities h,i 8.60 0.26 8.86 9.20 0.33 9.53 103.14 (1.47) 101.67 120.83 (2.02) 118.81 Current LiabilitiesFinancial Liabilities (i) Borrowings 966.69 - 966.69 743.37 - 743.37 (ii) Trade payables 178.13 - 178.13 148.02 - 148.02 (iii) Other Financial Liabilities f 67.19 0.28 67.47 61.74 - 61.74 Other Current Liabilities 99.16 - 99.16 57.59 - 57.59 Short Term Provisions e 15.55 (5.66) 9.89 10.62 (5.51) 5.11 Current Tax Liabilities (Net) 15.63 - 15.63 19.08 - 19.08 1,342.35 (5.38) 1,336.97 1,040.42 (5.51) 1,034.91 Total 2,226.40 (4.64) 2,221.76 1,917.83 (5.95) 1,911.88

Note: The previous GAAP figures have been reclassified to conform to IND AS presentation requirements for the purposes

B) Reconciliation of total Comprehensive Income for the year ended 31st March 2016(` In Crores)

Particulars ref Indian gAAP

gAAP Adjustments

As per IND AS

Revenue from operations k, l 2,715.22 5.10 2,720.32 Other income b 8.99 0.10 9.09 Total Income 2,724.21 5.20 2,729.41 Expenses: Cost of materials consumed 1,914.64 - 1,914.64 Purchases of stock-in-trade 142.74 - 142.74 Changes in inventories of finished goods work-in-progress and stock-in-trade

(16.74) - (16.74)

Contd...



(` In Crores)Particulars ref Indian

gAAPgAAP

AdjustmentsAs per IND AS

Excise duty on Sale k - 51.98 51.98 Employee benefits expense 148.54 - 148.54 Finance costs a 105.52 0.62 106.14 Depreciation and amortization expense g 46.38 (1.03) 45.35 Other expenses b,c,d,f,l 272.22 (46.06) 226.16 Total expenses 2,613.30 5.51 2,618.81 Profit before exceptional items and tax 110.91 (0.31) 110.60 Exceptional items Insurance Claims Written Off 45.80 - 45.80 Profit before tax 65.11 (0.31) 64.80 Tax expense: (1) Current tax 17.65 - 17.65 (2) Deferred tax i (1.44) (0.07) (1.51)(3) MAT Credit Entitlement 6.94 - 6.94 Profit (Loss) for the period 41.95 (0.24) 41.71 Other Comprehensive Income Items that will not be reclassified to profit or loss Fair value of Investment c 0.71 0.71 total Comprehensive Income for the period 41.95 0.47 42.42

Note: The previous GAAP figures have been reclassified to conform to IND AS presentation requirements for the purposes of this note.

C. Reconciliation of equity as at 31st March 2016 and 1st April 2015 between previous gAAP and IND AS:(` In Crores)

Particulars ref As at 31.03.2016

As at 01.04.2015

total equity reported under Previous gAAP 780.91 756.57

Loan recognized at amortized cost using effective rate of interest a 1.73 2.35

Fair value of financial assets at amortized cost b (0.64) (0.61)

Fair value of investment through OCI c 0.60 (0.01)

Expected credit loss on trade receivables d (1.44) (1.14)

Reversal of proposed dividend and recognition in the year of declaration and payment e 5.66 5.51

MTM of forward contract f (0.28) -

Other adjustments g 1.03 -

Deferred tax liability on land revaluation h (0.12) (0.12)

Impact of deferred tax on IND AS impact i (0.14) (0.21)

Adjustment on consolidation n (4.19) (4.19)

Net IND AS adjustments 2.21 1.58

total Equity under IND AS 783.12 758.15

Notes to the reconciliation of Balance Sheet as at 1st April, 2015 and 31st March, 2016 and the total comprehensive income for the year ended 31st March, 2016.

a) Loan recognized at amortized cost using effective rate of interest

Under the previous GAAP, transaction costs incurred in connection with borrowings are amortized upfront and charged to profit or loss for the period. Under IND AS, transaction costs are included in the initial recognition amount of financial liability and charged to profit or loss using the effective interest method.


171

b) Fair value of financial assets at amortized cost

i) Security deposits (Refundable on completion of lease term) Under the previous GAAP, interest free security deposits (that are refundable in cash on completion of lease term) are

recorded at their transaction value. Under IND AS all financial assets are required to be recognized at fair value. Accordingly the Company has fair valued the security deposit retrospectively. Difference between the transaction value and fair value is recognized as prepaid rent as on the date of transition and thereafter recognized at amortized cost.

ii) Interest free retention money (Refundable on completion contract) Under the previous GAAP, interest free retention money (that are refundable in cash on completion of lease term) are

recorded at their transaction value. Under IND AS all financial assets are required to be recognized at fair value. Accordingly the Company has fair valued the retention money. Difference between the transaction value and fair value is recognized in retained earnings as on the date of transition and thereafter recognized at amortized cost.

c) Fair value of investment through OCI

Under the previous GAAP, investments are recorded at their transaction value. Under IND AS all investment are required to be recognized at fair value. Accordingly the company has fair valued the investment at each balance sheet date based on quoted market price in active market. Difference between the transaction value and fair value is recognized in other comprehensive income.

d) Expected credit loss on trade receivables

Under the previous GAAP, allowances on trade receivables are required to be recognized based on actual doubtful debt. Under IND AS, life time expected credit losses are required to be recognized based on its historically observed default rates over the expected life of trade receivable.

e) Reversal of proposed dividend and recognition in the year of declaration and payment

Under the previous GAAP, proposed dividend including corporate dividend tax (CDT), are recognized as liability in the period to which they relate, irrespective of when they are declared. Under IND AS, proposed dividend is recognized as liability in the period in which it is declared by the Company, usually when approved by the shareholders in a general meeting or paid.

f) MtM of forward contract

Under IND AS, any gains or losses arising from changes in the fair value of derivatives are recognized directly in profit or loss and corresponding assets and liabilities have been recognized.

g) Other adjustments

Under IND AS, transaction costs incurred are included in the initial recognition amount of Investment.

h) Deferred tax liability on land revaluation

Under the previous GAAP, deferred tax is calculated using the income statement approach. Under IND AS, deferred tax are required to be recognized on land revaluation as at 1 April 2015 related to the earlier land revaluations.

i) Deferred tax

Under the previous GAAP, deferred tax is calculated using the income statement approach, which focuses on difference between taxable profits and accounting profits for the period. IND AS 12-“ Income tax” requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base

j) Assets held for sale

Under IND AS 105, “Non-current assets held for sales and discontinued operation” requires assets to be identified as held for sales if carrying amount will be recovered principally through sale transaction rather than continuing use and sale is considered highly probable. Consequently land held for sales have been presented separately from property plant and equipment. There is no impact on total equity and profit as a result of this adjustment.

k) Excise duty

Under the previous GAAP, revenue from sale to goods was presented exclusive of excise duty. Under IND AS revenue from sales of goods is presented inclusive of excise duty. Excise duty paid is presented on face of statement of profit and loss account as a part of expense.



l) Cash discount

Under the previous GAAP, cash discount was presented under other expenses. Under IND AS revenue from sales of goods is recognized at fair value of consideration expected to be received. Accordingly revenue for the year ended March 31, 2016 is presented net of cash discount.

m) Statement of cash Flows

The transition from Indian GAAP to IND AS has not had a material impact on the statement of cash flows.

51. Additional information, as required under Schedule III to the Companies Act, 2013 pertaining to the Parent Company and Subsidiaries:

(` In Crores)

Name of the Enterprise Net Assets Share in Profit or Loss Share in Other Comprehensive

Income (OCI)

Share in total Comprehensive

Income (tCI)(total Assets – total

Liabilities)

As a % of Consolidated

Net Assets

Amount As a % of total Profit

or Loss

Amount As a % of OCI

Amount As a % of TCI

Amount

Parent:

LEEL Electricals Ltd. 102.33 921.35 121.65 85.14 100.00 0.35 121.54 85.49

Foreign Subsidiaries

Lloyd Coils Europe s.r.o. 7.81 70.31 (0.24) (0.17) - - (0.24) (0.17)

Janka Engineering s.r.o. (0.78) (7.06) (14.97) (10.48) - - (14.90) (10.48)

Noske Kaeser Rail & Vehicle Germany GmbH

0.29 2.58 (0.41) (0.29) - - (0.41) (0.29)

Noske Kaeser Rail & Vehicles New Zealand Limited#

1.50 13.55 0.46 0.32 - - 0.45 0.32

Adjustment arising out of consolidation

(11.14) (100.32) (6.47) (4.53) - - (6.44) (4.53)

Total 100.00 900.41 100.00 69.99 100.00 0.35 100.00 70.34

* Noske Kaeser US Rail & Vehicle LLC is yet to commence its operations and hence, not considered for the purpose of consolidation. # The financials of Noske Kaeser Rail & Vehicles New Zealand Limited are consolidated financials and includes financials of its two step down

subsidiaries viz; Noske-Kaeser Rail & Vehicle Australia Pty Ltd. and Noske-Kaeser Empreendimentos e Participaçôes do Brasil Ltda.

For other details w.r.t. subsidiaries please refer Note 2.4 of the Consolidated Financial Statements.

52. Figures relating to April 1, 2015 (date of transition) has been regrouped/reclassified wherever necessary to make them comparable with the current year figures.

53. Notes ‘1’ to ‘52’ form an integral part of accounts and are duly authorized.

As per our Report of even date attached For and on behalf of the Board For Suresh C. Mathur & Co. Chartered Accountants




173

Form AOC- 1(Pursuant to first proviso to sub section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014)

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

Part “A”: Subsidiaries

(` In Crore)

Name of the Subsidiary Lloyd Coils Europe s.r.o.

Janka Engineering

s.r.o.

Noske Kaeser Rail & Vehicle

germany gmbh

Noske Kaeser Rail & Vehicles New

zealand Limited.

S.No. Reporting Period March 31, 2017 March 31, 2017 March 31, 2017 March 31, 2017

1 Reporting Currency CZK CZK EURO NZD

2 Exchange Rate 2.57 2.57 69.25 45.40

3 Share Capital 46.15 38.57 2.49 14.94

4 Reserves and Surplus 24.15 (45.63) 0.08 (1.39)

5 Total Assets 134.73 47.80 14.47 27.03

6 Total Liabilities 64.43 54.86 11.90 13.48

7 Investments - - - -

8 Turnover 217.64 76.53 30.97 30.96

9 Profit before taxation (0.02) (10.48) (0.11) 0.45

10 Provision for taxation 0.15 - 0.18 0.13

11 Profit after taxation (0.17) (10.48) (0.29) 0.32

12 Proposed Dividend - - - -

13 % of shareholding 100% 100% 100% 100%

Notes:

1. NoskeKaeser US Rail & Vehicle LLC, wholly owned subsidiary, is yet to commence its operations.

2. The financials of NoskeKaeser Rail & Vehicles New Zealand Limited are consolidated financials and includes financials of its two step down subsidiaries viz; Noske-Kaeser Rail & Vehicle Australia Pty Ltd. and Noske-Kaeser Empreendimentos e Participaçôes do Brasil Ltda.

3. There is no subsidiary which has been liquidated or sold during the year.

4. For other details w.r.t. subsidiaries please refer Note 2.4 & 51 of the Consolidated Financial Statements.

5. There are no associate companies within the meaning of Section 2(6) of the Companies Act, 2013. Hence, Part B is not applicable.

For and on behalf of the Board

Mukat B. Sharma Achin Kumar Roy Whole Time Director & CFO Whole Time Director & (DIN:02942036) Chairman of the Meeting (DIN:01475456)




NOTES


175

NOTES



NOTES

Engineering Smiles... Enriching Lives...

LEEL Electricals Limited(Formerly Lloyd Electric & Engineering Limited)

CIN: L29120UP1987PLC091016Corp. Off.: 159, Okhla Industrial Estate, Phase-III, New Delhi-110020 (INDIA)

Ph: 91-11-40627200-300, Fax: 91-11-41609909Website: www.leelelectric.com, E-mail: [email protected]

LEEL Electricals Limited · ANNUAL REPORT 2016-17 LEEL Electricals Limited (Formerly Lloyd Electric...

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