AFFLUENCE

DIRECTORS’ REPORT

Your Directors have pleasure in presenting the Second Annual Report along with the Accounts for the year ended March 31, 2014.

1.FINANCIAL RESULTS

The Summarized Financial Results of your Company for the year ended:

Rs.Lakhs

* The Company commenced commercial operations from January 1, 2014 and the figures indicate pre-operative expenditure incurred prior to commencement of business.

2.APPROPRIATIONS

There were no appropriations made during the year 2013-14.

3.DIVIDEND

The Directors recommend payment of dividend of Rs.0.1233 per preference share of Rs 10/- each being pro-rata dividend at coupon rate of 10% p.a. from date of allotment of shares till end of financial year. The Directors do not recommend any dividend on equity shares for the financial year 2013-14.

4.CAPITAL AND FINANCE

During the year under review, the Company increased its Authorized Capital to Rs.10, 50,00,00,000. The Company allotted 10,24,50,000 Equity Shares of Rs. 10 each and 40,00,00,000 10% Non-convertible Redeemable Preference Shares to Larsen & Toubro Limited on rights basis. During the year under review, your Company acquired the Product Engineering Services (PES) unit of Larsen & Toubro Infotech Limited (100% subsidiary of Larsen & Toubro Limited). The PES business was christened and operates as HiTech and Telecom vertical delivery unit (VDU) in the Company.

5.CAPITAL EXPENDITURE

As at March 31, 2014, the gross block for fixed and intangible assets (excluding goodwill on acquisition) stood at Rs. 5,393 Lakhs, out of which assets amounting to Rs.3,812 lakhs were transferred from Larsen &Toubro Infotech Limited as a part of the HiTech and Telecom business transfer and Rs.1,581 lakhs were added during the 3 months ended March 31, 2014.

6.AUDITORS’ REPORT

The Auditors’ Report to the shareholders does not contain any qualifications. The notes to the accounts referred to in the Auditors’ Report are self-explanatory and therefore do not call for any further comments of Directors.

7.PERFORMANCE OF THE COMPANY

During the period under review, the Company commenced commercial operations and generated revenue of Rs.12,220 lakhs for the period January-March 2014. The geographical revenue contribution for HiTech and Telecom VDU is primarily from North America (63%) followed by APAC (19%), Domestic (14%), Europe and ROW (4%).The Profit after tax (PAT) for the three months period stands at Rs.621 lakhs.

8.DEPOSITS

During the year under review, the Company did not accept any deposits from the public.

9.MATERIAL CHANGES, IF ANY, BETWEEN THE DATE OF THE BALANCE SHEET AND DATE OF THE DIRECTOR’S REPORT:

There are no material changes that have taken place in the Company between the date of the Balance Sheet and the date of the Director’s Report.

10.CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO AS PER RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES, 2014

Conservation of Energy:

The Company’s operations are not energy-intensive. However, appropriate measures are taken to reduce energy consumption and ensure lower load during non-peak hours.

Technology Absorption:

There was no technology absorption during the year 2013-14.

Foreign Exchange Earnings & Outgo:

The Company exports engineering designing professional services mainly to North America, Europe, Middle East, Japan, Korea, other APAC countries. The total foreign exchange earned and used for the period under review is as below:

Rs.Lakhs

11.SUBSIDIARY COMPANY

Your Company does not have any subsidiary company under its purview.

12.PARTICULARS OF EMPLOYEES

There are no employees covered by the provisions of Section 217(2A) of the Companies Act 1956, read with the Companies (Particulars of Employees) Rules, 1975.

13.AUDITORS

The Auditors, M/s. Sharp & Tannan, Chartered Accountants, being Statutory Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. Certificate from Auditors has been received to the effect that their re-appointment made, would be within the limits prescribed under section 141(3)(g) of the Companies Act, 2013.

14.DIRECTOR’S RESPONSIBILITY STATEMENT

The Board of Directors of the Company confirms that:

i.in the preparation of the annual accounts, the applicable Accounting Standards had been followed;

ii.the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and profit/loss of the Company for that period;

iii.the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv.the Directors had prepared the annual accounts on a going concern basis; and

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

15.DIRECTORS

At present the Board comprises of Mr. V. K. Magapu, Mr. K. R. L. Narasimham and Dr. Keshab Panda.

Mr. Samir Desai and Dr. Hasit Joshipura were appointed as Additional Directors of the Company with effect from 30th April, 2014. Resolutions proposing their appointment as Independent Directors will be placed before the Shareholders for their approval.

In the ensuing Annual General Meeting, Mr. K. R. L. Narasimham is liable to retire by rotation at this Annual General Meeting and being eligible offers himself for re-appointment.

16.AUDIT COMMITTEE

The Audit Committee consisting of three Non-Executive Directors was constituted during the year. The present members of the Committee are Mr. V. K. Magapu, Mr. K. R. L. Narasimham and Dr. Keshab Panda.

17.NOMINATION & REUNERATION COMMITTEE

The Nomination & Remuneration Committee consisting of three Non-Executive Directors was constituted during the year. The present members of the Committee are Mr. V. K. Magapu, Mr. K. R. L. Narasimham and Dr. Keshab Panda.

18.ACKNOWLEDGEMENT

The Directors acknowledge the invaluable support extended to the Company by the Financial Institutions, Regulatory Authorities, bankers, employees of the Company and management of the parent company.

For and on behalf of the Board

V. K. MAGAPU

Director

KESHAB PANDA

Director

Place: Mumbai

Date: April 30, 2014.