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HDFC Life Insurance Company Ltd.

BSE: 540777 Sector: Financials
BSE 00:00 | 24 Apr HDFC Life Insurance Company Ltd
NSE 05:30 | 01 Jan HDFC Life Insurance Company Ltd
OPEN 481.10
VOLUME 184159
52-Week high 646.40
52-Week low 339.15
P/E 67.93
Mkt Cap.(Rs cr) 91,603
Buy Price 453.75
Buy Qty 11.00
Sell Price 453.75
Sell Qty 9.00
OPEN 481.10
CLOSE 488.20
VOLUME 184159
52-Week high 646.40
52-Week low 339.15
P/E 67.93
Mkt Cap.(Rs cr) 91,603
Buy Price 453.75
Buy Qty 11.00
Sell Price 453.75
Sell Qty 9.00

HDFC Life Insurance Company Ltd. (HDFCLIFE) - Director Report

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Company director report



The Directors are pleased to present the 17th Annual Report of HDFC StandardLife Insurance Company Ltd. ("Company" / "HDFC Life") together withthe Audited Financial Statements of the Company for the FY 2017.

Standalone Financial Performance and Business Review Financial Performance

(Rs. Crs)

Particulars FY 2017 FY 2016
(Audited) (Audited)
Individual business:
a. New business premium 4201 3657
(i) Regular premium 3573 3296
(ii) Single premium 628 361
b. Renewal premium 10749 9826
Group premium 4495 2830
TOTAL PREMIUM 19445 16313
Assets Under Management 91742 74247

Other key parameters

Particulars FY 2017 FY 2016
Embedded value 12389 10233
Overall New Business Margins (post overrun) 21.6% 19.9%

Note: Embedded Value for FY 2016 based on external review and FY 2017 no. based onManagement estimate

Business Review and Outlook Industry Outlook

The FY 2017 was a critical year for life insurance industry in India. Themacro-economic factors and demographic profile continue to support growth forfinancial services. Players continue to adapt to the changing macro landscape whilecompeting to hold their turf.

Within the life insurance industry private life insurers continued to grow atrelatively faster rate and gained higher market share within Individual segment. Evenunder the Group segment private players continue to gain traction and have deliveredhealthy growth.

Improving macro trends with India outperforming other emerging markets increasingtraction in equity markets and higher focus on financial inclusion and penetration toincrease the financial savings was reflected in 26% growth in Individual New BusinessWeighted Received Premia (WRP) and 20% growth in Group premia for the private playersduring FY 2017. At an industry level the sector witnessed growth of 21% in Individual NewBusiness WRP and 21% in Group premia during the year.

Demonetisation drive launched by Government of India in November 2016 also triggeredgrowth for select players in individual segment leveraging the spurt in the bank depositswhich is reflected in above industry trends.

There also has been steady increase in proportion of business generated throughcorporate agents comprising banks and other financial services players amongst privateplayers during past 5 years. This channel contributed 52% of total individual reported newbusiness in 9M FY 2017 across all private players (Source: Public disclosures)

On the product segments reduced allowable charges to distributors' within ULIP segmentand higher expense structures led many players to move towards traditional products.However since 2014 market performance and transparent product structures have helpedincrease pull for ULIP products. There is increasing demand for protection products andits implicit higher new business margins (NBMs) has resulted in recent focus on the termsegment across players.

Company Performance

Individual Business Performance

HDFC Life ranked #3 among private players in terms of Individual WRP with a marketshare of 12.7% in FY 2017 versus 14.7% in FY 2016. During the year under review theCompany issued 10.82 lac policies in the Individual segment. The Company continues tooffer diversified product suite across Linked Participating and Non Participatingsegments.

The Company also continued its focus on pure protection segment including mortality andmorbidity coverage reflected through increase in overall new business sum assured by 43%.Overall traditional Non Participating products contributed 13% of Individual APE versus14% in FY 2016 and Participating products contributed 35% versus 30% in FY 2016. TheLinked business continued to dominate the product portfolio of the Company contributing52% versus 56% last year.

In line with its strategy the Company has been working to ensure diversification andstrengthening its distribution mix across Corporate agents Individual agents Brokers andDirect channels including Online. Digital remains a key thrust area and the Company hasbuilt a robust technology platform for its distributors and customers to leverage itsdigital capabilities.

The Company has an efficient technology platform which ensures ease of purchase forconsumers while enabling rapid integration with distributors. Digital procurementfulfillment and customer servicing continue to be the key focus areas. In FY 2017 over98% of the proposal forms were submitted through digital medium and 70% of renewalbusiness was received through online modes. The Company has various process and systemcontrols delivery assurance and internal and concurrent audits that leads to lowerdependency risks scalability and ability to anticipate any issues or concerns.

Group Business Performance

Within Group business segment the Company maintained its #1 rank amongst privateplayers with market share of 24.3% in FY 2017 versus 18.3% in FY 2016 (rank #1) based onnew business received premium. The Company focused on selling protection orientedproducts even within this segment through multiple partners. The New Business sumassured under the Group category increased from Rs. 165655 Crs in FY 2016 to Rs. 285454Crs covering 1.98 Crs lives during FY 2017.

Overall Business Performance and Financial Review

The Company continued to deliver strong operating and financial performance during theyear under review. In line with the identified strategy high focus was maintained onprofitable growth and customer satisfaction.

The total premium grew by 19% in FY 2017 with 15% growth in Individual new businesspremium and 59% in Group premium.

The Company's continued focus on better quality of business sourcing customerretention and persistent efforts in customer education has resulted in an increase inrenewal premium by 9% in FY 2017 to Rs. 10749 Crs. The 13th month persistencyratio improved from 79% in FY 2016 to 81% in FY 2017 and 61st month persistencyimproved from 50% in FY 2016 to 57% in FY 2017 (based on original premium method).

For FY 2017 the Company earned IGAAP profits of Rs. 892 Crs versus Rs. 818 Crs in FY2016 i.e. an increase of 9%. The Company ended the year under review with anaccumulated profit of Rs. 1613 Crs post payment of interim dividend of Rs. 264Crs including dividend distribution tax (DDT).

Backed by healthy business performance and persistency the Assets under Management(AUM) for the Company crossed the milestone of Rs. 90000 Crs mark during the year underreview and saw a growth of 24% to Rs. 91742 Crs as on March 31 2017 versus Rs. 74247Crs as on March 31 2016. Balanced debt-equity mix of AUM was ensured with debt-equityproportion of 59:41 as on March 31 2017.

The Company increased its presence across the country with several new tie-ups andpartnerships across traditional and non-traditional partners including NBFCs MFIs SFBsetc. Total branch presence of the Company increased to 414 branches during the year underreview across 819 cities.

During the year the Company has increased its exposure and presence in pension segmentand re-insurance market in UAE through its two wholly owned subsidiaries - HDFC PensionManagement Company Limited (‘HDFC Pension') and HDFC International Life and ReCompany Limited (‘HDFC International').

The Company is committed to its positioning as the most preferred life insurancecompany in India delivering value for all its stakeholders. Improving business qualityensuring seamless customer journey and delivering healthy returns continue to be the keyfocus areas for the Company. Digital ecosystems and leveraging technology will be animportant driver in this journey and area of investment along with new distributionavenues to achieve above objective.

Policyholder and Customer Service

HDFC Life is committed to provide seamless services to the customers and the claimantsin the shortest possible turnaround time across the life cycle of the policy with minimumdocumentation and data requests.

Various initiatives have been implemented by the Company during last year including:

1) Adopting Tele-underwriting capability

2) Medical underwriting based on customer's executive health reports.

3) Financial risk assessment through use of credit bureau reports

4) Deployment of OCR into the workflow interface

5) Deployment of robotics

6) Adoption of ‘Claims Assist' for speedier completion of the policy documentation

7) Facility to the customers for submission of maturity/ money back/ pension/ annuitydocuments through Whatsapp;

8) Differential process for HNI claimants

9) Lean cell for taking care of claims of Defence personnel.

Specialised underwriters are in place for the overall underwriting and related processincluding dedicated people for online and group customers.

The above initiatives have helped us improve customer experience and enabled reducingprocessing time.

During the year under review the Company had achieved the below milestones:

1) The Company stands amongst the best in the industry on overall ClaimsSettlement Ratio of 99.2% in FY 2017

2) The Company's turnaround time for non investigated claims improved to ‘within 3days' from ‘7 days' in FY 2017;

3) In the Micro Finance Business 100% of the claims processing is completed within 2days of document submission;

4) Approximately 98% of the Money Back payouts and 99% of the Annuity Payments aredone on the due date.

For renewals around 78% of the customers paid premium via alternative paymentmethods such as auto debits (55.5%) and online payments (21.7%) which comprises 70% ofthe Company's total collections versus 61% last year. The Company strengthened its previousyear initiative of last mile connectivity with the lapsed and paid-up customers byeducating them on importance of revivals.

Even prior to the Central Government's focus to move towards ‘Cashless' economythe Company had stopped accepting cash payment for renewals at HDFC Lifebranches in phases with a pan-India phasing out made effective from July 1 2016. TheCompany continues to offer multiple options to its customers for easy renewalpayment including online payment through Credit Card Debit Card and multiplepayment wallets payment through Inbound IVR MSwipe NEFT/ eCMS and ofiine facility topay the premium at HDFC Life branches and numerous other partner branches includingHDFC Bank Axis Bank cheque drop boxes etc.


ULIP Life (10) Par Life (7) Non Par Life (2)
HDFC SL Crest HDFC Life ClassicAssure Plus HDFC Life Sanchay
HDFC SL ProGrowth Super II HDFC Life Super Savings Plan HDFC SL Sarvgrameen Bachat
HDFC SL ProGrowth Maximizer HDFC Life Super Income Plan Yojana
HDFC SL Young Star Super Premium HDFC Life YoungStar Udaan
HDFC SL ProGrowth Flexi HDFC Life Sampoorn Samridhi
HDFC SL ProGrowth Plus Plus
HDFC Life Smart Woman HDFC Life Uday
HDFC Life Click 2 Invest – ULIP HDFC Life Pragati
HDFC Life Sampoorn Nivesh
HDFC Life Capital Shield


Pension/Annuity (7) Protection (2) Group (10) Health (2)/Rider (8)
HDFC Life Pension Super Plus HDFC Life Click 2 Protect Plus HDFC Group Term Insurance HDFC Life Cancer Care
HDFC Life Single Premium Pension Super Plan HDFC Life CSC Suraksha Plan HDFC Life Group Credit Protect Insurance Plan HDFC Life Easy Health
HDFC Life Click 2 Retire-ULIP HDFC Life Group Pension Plan HDFC Life Income Benefit on Accidental Disability Rider
HDFC Life Assured Pension Plan HDFC Life Group Unit Linked Pension Plan HDFC Life Critical Illness Plus Rider
HDFC Life New Immediate Annuity Plan HDFC Life New Group Unit Linked Plan Total and Partial Permanent Disability Benefit
HDFC Life Personal Pension Plus HDFC Life Group Variable Employee Benefit Plan Accident Death Benefit (Group)
HDFC Life Guaranteed Pension Plan HDFC Life Group Credit Protect Plus HDFC Life Group Critical Illness plus
HDFC Life Pradhan Mantri Jeevan Jyoti Bima Yojana Total Permanent Disability Benefit
HDFC Life Group Jeevan Suraksha Critical Illness Benefit
HDFC Life Group Credit Suraksa Accident Death Benefit (Individual)

HDFC Life has continuously focused on creating differentiators to meet customer needsand expectations. The Company has proactively identified and owned niche customer segmentsand product categories to drive appropriate actions. The Company aspires to attainleadership position in select identified segments by delivering unique sales productsand service experience.

HDFC Life's product portfolio comprises of solutions catering to the varied individualcustomer needs across Protection Pension Savings Investment and Health category. HDFCLife also offers different products for varying needs of employers ranging from terminsurance plans for pure protection to voluntary plans such as superannuation and leaveencashment.

During the year under review with an objective to further insurance penetration andfinancially secure Indian households the Company forayed into the micro-insurance segmentby launching two products HDFC Life Group Jeevan Suraksha and HDFC Life Group CreditSuraksha.

The Company also launched individual participating savings product HDFC Life Pragatiwith features and benefits suitable for low to middle income individuals which have notbeen reached so for due to aflordability factor. This product has a potential to cater tothe untapped Indian households within lower income bracket.

Further the Company expanded within the Health category by launching HDFC Life EasyHealth that provides hassle free comprehensive protection against critical illnesssurgical procedures and hospitalisation expenses under one plan without any medicalunderwriting.

The Company also added HDFC Life Capital Shield product in the Unit Linked category tocater to the needs of the investors looking to tap the potential upside of the financialmarkets while having an assurance of Capital Guarantee.

At the end of the year under review HDFC Life has 30 Individual and 10 Group productswith 8 Riders available for its customers.

Human Resource and People Development

HDFC Life gives paramount importance to employee satisfaction and overall developmentof over 14800 employees that constitute its workforce. The Company earnestly strives todistinguish itself from the peers and aspires to be counted amongst the best places towork across various sectors.

During the year under review the Company has undertaken various initiatives to supportbusiness through organisational efficiency and various employee engagement programmeswhich have enabled achievement of higher productivity levels. The Company continued tofocus on developing leadership as well as technical and functional capabilities ofemployees in order to meet future talent requirement.

Philosophies that drive talent management included having the most skilled and engagedemployees discharging their current roles while developing a strong bench of readytalent. We continued with our robust talent review and development processes across theboard which assessed potential and developmental needs of talent. Output of these reviewsaggregated into structured learning interventions that were executed by top institutionslike ISB and the IIM A.

Internal talent was given ample opportunities to take up managerial roles through atransparent fair and scientific Internal Job Posting (IJP) process. Cross functionalmovements of talent were encouraged and enabled through talent review and assessmentprocess to provide holistic understanding of business to employees.

Company's L&D framework boasts of talented and experienced resources who ensurethat interventions get customised to specific and special training needs therebymaximizing impact and efficacy. In course of the year the core focus area has beentowards implementation of digital learning solutions like a Mobile learning app therebyenhancing the learner reach in addition to Just-in-Time access to learning content whichis critical for efficiency on job delivery.

The HR journey continued to be built on the bedrock of technology and innovation withstate of the art offerings like HR mobile application to build an enviable mobilityplatform that is rapidly transforming employee workforce productivity.


During the year under review the global equity markets have seen significant gains asglobal concerns on growth and anxiety over the fate of commodity economies faded. Thepick-up in commodity prices further helped pull the price indices in the developedeconomies away from the deflation zone. On back of above developments respective CentralBanks regained confidence to initiate steps for rolling back the extreme accommodationprovided by their respective monetary policies.

In the domestic market the recovery in the corporate earnings has been relativelyslow. Withdrawal of high denomination currency notes by the Government further impactedthe corporate earning profile. However the improvement in risk appetite globally andstrong flows from domestic investors helped the equity markets overcome the concerns overearnings and post strong gains for the year.

During the same period bond yields saw substantial softening on the back of easinginflation. The Reserve Bank of India (‘RBI') cut rates lower during the year but theextent of the rate cuts were lower than expected. Consequently bond yields retraced fromthe low levels seen during the year.

HDFC Life's equity funds performed well during the year with all the key equity fundsperforming in line with the respective benchmarks and the peers. The Company's bond fundshave been managed dynamically to calibrate the positions appropriately based on the risklevels in the portfolio. The fund returns have out-performed their respective benchmarksand have also performed well against peer funds.

The investment funds of the Company are managed as per the stated objectives laid downin the Investment Policy Asset-Liability Management Policy (‘ALM') and respectiveFunds' objectives. These policies lay down the asset allocation and risk appetiteguidelines for different funds some of which have in-built guarantees. Fund allocation istracked on a regular basis and is backed with suitable assets. During FY 2017 the assetallocation in the Company's conventional and shareholder funds was in line with the ALMpolicy.

HDFC Life total AUM as on March 31 2017 was Rs. 91742 Crs. This comprised assets ofRs. 53800 Crs held under the unit-linked funds and Rs. 37942 Crs held under theconventional funds and shareholders' funds. The corresponding numbers for the previousyear were Rs.45727 Crs and Rs. 28520 Crs respectively.

Information Technology

FY 2017 has seen the adoption of many cutting edge technologies such as BlockchainInternet of Things (IOT) Robotics Process Automation (RPA) Chatbots among insuranceproviders globally. Further there is an emergence of a new breed of Insuretech start-upslooking to disrupt the insurance value chain.

HDFC Life intends to be the leading digital insurer in the country. The TechnologyEnabled Business Transformation (TEBT) programme has over the last 24 months created aservice driven platform that makes it easier for the distribution partners to integratewith HDFC Life. This has helped in building an agile and multi-distribution model thatfits into the strategic objectives of the Company.

During FY 2017 the Company undertook an initiative to set up the entire sales cycle onthe mobile platform. This initiative termed Mobility 1.0 significantly reduced customeracquisition cycle time increased sales productivity and reduced paper trail throughoutthe Company. In addition to the productivity improvements this allowed sales team to workindependent of the branch infrastructure. This also resulted in reducing cost for saleshubs. The new and improved individual portal for Financial consultants was also launchedduring the FY 2017 as part of TEBT program.

To further improve the Digital Ecosystem Mobility 2.0 was introduced during FY 2017to leverage and build on the capabilities created in Mobility 1.0. The modules include:

i. geo-capabilities that help in lead allocation partner visit tracking and customerheat maps;

ii. India stack integration-integration with Aadhar including IRIS authenticatione-sign and UPI;

iii. sales force management with daily task sheet and audio huddles;

iv. sales aids such as auto financial planning tool auto filling of formspre-approved offers expert on call;

v. customer servicing capabilities; vi. virtual sales assistant; and vii. mobilelearning.

Besides the Company has been working with its Bancassurance relationships andintegrating with the bank CRM systems. This has led to STP (straight through processing)process for issuance of policies and a unique digital experience for customers of selectBank partners.

The Company has continued with its efforts to tighten controls and prevent customercomplaints. A completely automated and sophisticated control mechanism has beenimplemented during FY 2017. The resulting capability has enabled proactive identificationof anomalies in critical areas like compliance to file and use requirements and payoutcomputations.

The Company also conducted a Hackathon with a focus on three broad based themes -Design Data Science and Mobility.

The Company has been re-certified on ISO 27001:2013 for its data centre and operations.Several cyber security initiatives have also been implemented during the year such asNext-Gen Firewall Intrusion Prevention System Security Incident and Event Management andDDOS services.


The Company received more than 40 awards and accolades during the year under reviewacross financial disclosures customer service technology digital solutions productshuman resources marketing etc. The Company received the National Quality ExcellenceAward 2017 for being the most innovative Company. The Company also received Golden Shieldaward for Excellence in Financial Reporting for their Annual Report FY 2016 from ICAI (TheInstitute of Chartered Accountants of India).

Regulatory Landscape

During the year under review some of the key regulations / guidelines etc. issued bythe Insurance Regulatory and Development Authority of India ("IRDAI" /"Authority") include:

Circular on Implementation of Indian Accounting Standards ("Ind AS") forinsurance sector. The Ind AS implementation will have impact on financial reportingsystems and processes significantly. The Company is taking necessary steps forimplementation as per timelines notified by the Authority to achieve transition to Ind ASby FY 2018. Representatives from the Company are also part of Steering Committee set up bythe IRDAI which is overseeing implementation of Ind AS in the industry.

The Authority revised the Guidelines on Corporate Governance for insurers in India(‘Guidelines') which includes revised provisions on certain Corporate Governancepractices appointment of Managing Director/ Chief Executive Officer/ Whole Time Directorand other Key Management Persons as well as the appointment of statutory auditors ofinsurers. These are applicable from FY 2017 onwards and have been implemented asrequired.

With a view to further promote digital ecosystem and in policy holder interest theAuthority has required insurers to compulsorily issue policies in electronic form beyonda certain sum assured threshold. It has also permitted use of electronic proposal form.These will promote efficient processes and speed up policy issuance.

Revised Health Insurance regulations were issued by the Authority allowing lifeinsurers to offer long term Individual Health Insurance products for term of 5 years ormore with premium uniformity for blocks of 3 years. Importantly the Authority has barredlife insurers from offering indemnity based products. In view of this the Company had towithdraw its indemnity based health product impacting business in this segment.

The revised Investment regulations have prescribed several new provisions includingrestrictions on investing in fixed deposits and corporate deposits of promoter groupcompanies Chief Risk Officer to be part of the Investment Committee and custodian not tobe part of the promoter group etc. The Regulation also requires Statutory auditors toconfirm compliance with implementation of Investment Policy by Investment Committee andquarterly Board review of the fund wise and product-wise parameters.

The Authority notified new regulations effective April 1 2017 on Payment of Commissionto insurance agents and intermediaries. The underlying approach proposed uniformity acrossbusiness segments vis--vis the expenses of management commissions and manner ofcomputation of solvency. Regulations also provides for a Board approved policy on thesubject.

IRDAI also released several discussion papers/draft guidelines on key aspects ofbusiness and operations including Listing of Indian Insurance Companies; exposure draftson proposed revision in financial statements regulations; Protection of Policyholders'Interests and Outsourcing of activities etc.

Rural and Social Sector Obligations

The Company maintains dedicated focus on undertaking rural business and endeavors totailor its products and processes to support these businesses considering customer needs.

As part of its overall business the Company has achieved prescribed regulatory targetsof social and rural business as follows:

• Rural business – Achieved - 21% versus prescribed requirement of 20% ofoverall business

• Social business – Insured - 804612 social lives versus prescribed768851 social lives


The IRDAI requires life insurers to maintain a minimum Solvency Ratio of 150%. TheSolvency Ratio is calculated as specified in the IRDA (Assets Liabilities and SolvencyMargin of Insurers) Regulations 2016. As compared to the minimum requirement of 150% theCompany's Solvency Ratio as at March 31 2017 was 192%.

Dividend & Reserves

During the year under review an interim dividend @ Rs. 1.10 per equity share (facevalue of Rs. 10/- each) was declared by the Board of Directors and paid to theShareholders. The Board has recommended the same to be confirmed as the Final Dividend forFY 2017. Necessary resolution is being proposed for the purpose at the ensuing 17thAnnual General Meeting ("AGM").

The Company has carried forward a total of Rs. 627.7 Crs to its Reserves. The Companyhad accumulated profits of Rs. 1613.5 Crs on March 31 2017.

Capital & Shares

The Company's paid up equity share capital increased marginally from Rs. 19952881380as on March 31 2016 to Rs. 19984752830 as on March 31 2017 pursuant to allotment of2772995 equity shares upon exercise of Options under Employees Stock Option Scheme 2014;and allotment of 414150 equity shares upon exercise of Options under Employees StockOption Scheme 2015. The said allotments were made post requisite approval from theAuthority.

The Shareholding Pattern is given elsewhere in this Annual Report.

Initial Public Offering and Merger Proposal

During the year under review the Board of Directors of the Company approved takingsteps to initiate the process for an Initial Public Offering (IPO) of the Company by wayof an offer for sale by Housing Development Finance Corporation

Limited the Company's Indian Promoter Company upto 10% of the Company's paid-up andissued equity share capital. This was subject to relevant regulatory and other approvalsas applicable.

On August 8 2016 the Board of Directors of HDFC Life Max Life Insurance CompanyLimited ("Max Life") Max Financial Services Limited ("Max Financial")and Max India Limited ("Max India") at their respective board meetings approvedentering into definitive agreements for the amalgamation of the businesses between theabove entities through a composite Scheme of Arrangement ("Scheme") in amanner as below:

Step 1: Max Life Insurance Company Limited will be merged into Max Financial ServicesLimited

Step 2: The life insurance undertaking will be demerged from Max Financial ServicesLimited into HDFC Life

Step 3: The residual business of Max Financial Services Limited would be merged intoMax India Limited

Step 4: HDFC Life would become a listed Company

The proposed transaction will create a large company with differentiated scale andportfolio with wider reach to expand in a growing life insurance sector. While thetransaction will deliver attractive value proposition for HDFC Life and Max Groupshareholders it will also benefit the Policyholders by providing them with enhancedproduct portfolio and touch points. Employees of both the entities will reap benefits outof the transaction in terms of greater opportunities across functions and geographies.

Subsequent to the approval by the Board of Directors of respective Companies a jointapplication was filed with the IRDAI by the Company and Max Life seeking its in-principleapproval on the Scheme on September 21 2016. The IRDAI had expressed certain reservationon the merger transaction structure post which the Company has given suitableclarification supported with legal views and analysis.

The Company is presently awaiting / will require regulatory approvals from theInsurance Regulatory and Development Authority of India Competition Commission of Indiathe Securities and Exchange Board of India Stock Exchanges and Hon'ble Courts / NationalCompany Law Tribunal (NCLT) amongst others. As part of NCLT approval process theCompany will also seek approval of its Members as may be directed by the NCLT.

Policy on Directors' appointment and remuneration

The remuneration and compensation for Directors Key Managerial Personnel and otherEmployees is guided by the requisite Policy. More details are included in the CorporateGovernance Report forming part of this Directors' Report.

Evaluation of performance of the Board

Pursuant to and in line with the requirements prescribed under the Companies Act 2013('Act') the Board of Directors carried out an annual evaluation of its performance andthat of its Committees and Individual Directors. Further the Independent Directors metseparately without the attendance of non-Independent Directors and Members of theManagement and inter alia reviewed the performance of non-independent directors andBoard as a whole; and performance of the Chairman. They further assessed the qualityquantity and timeliness of flow of information between the Company Management and theBoard.

Overall the Independent Directors expressed their satisfaction on the performance andeffectiveness of the Board all the Committees Individual non-Independent Board Membersand the Chairman and on the quality quantity and timeliness of flow of informationbetween the Company Management and the Board. The Independent Directors shared additionalsuggestions on certain aspects to further improve the process. The Independent Directorsopined that the Company's Board was a benchmark Board and expressed their satisfactionwith the conduct and efficiency of the Board and Board Committees.

The Nomination & Remuneration Committee also undertook an evaluation of IndividualDirector's performance and expressed its satisfaction on performance of each Director.

The Board conducted the review of each Director's performance Board as a whole andperformance of Committees of the Board and expressed its satisfaction.

There has been no material adverse observation or conclusion consequent to suchevaluation and review.


The Company's Board comprises of 15 Directors including two AlternateDirectors. There are 13 non-executive directors (including 6 Independent Directorsand 2 Alternate Directors) and two Managing/Executive Directors. The Company'sBoard includes 2 women Directors including its Executive Director & Chief FinancialOfficer.

Changes during the year under review

The Board of the Company was further strengthened during the year with the induction ofMr. Sumit Bose and Mr. Ranjan Mathai as Additional Directors wef July 19 2016 andJuly 22 2016 respectively designated as Independent Directors. This has also addeddiversity to the Board resulting in enhanced Board independence.

Mr. Bose is former Union Finance Secretary (as Secretary Department of Revenue). Hejoined the Indian Administrative Service in 1976 and has served as Secretary(Expenditure) and Secretary (Disinvestment) as well as Secretary in the ThirteenthFinance Commission and in the Ministry of Finance GOI since August 2007 tillsuperannuation.

Mr. Mathai is former Foreign Secretary of India. He has held several keypositions in the Ministry of External Affairs of the Government of India includingas Joint Secretary heading the Division responsible for India's relations withBangladesh Myanmar Sri Lanka and the Maldives (1995-1998).

In line with the provisions of the Act the appointments of Mr. Sumit Bose andMr. Ranjan Mathai are proposed to be regularised at the ensuing AGM for a period of5 years from the date of their initial respective appointments and the relevantdisclosures for their appointment forms a part of the Notice of the 17th AnnualGeneral Meeting.

During the year under review in line with the applicable provisions under the Act Mr.Luke Savage and Mr. James Aird had vacated office as Alternate Director to Sir GerryGrimstone and Mr. Norman Keith Skeoch respectively at such times when Sir Gerry Grimstoneand Mr. Norman Keith Skeoch had visited India to attend the Board Meetings; andthey were re-appointed as Alternate Director to Sir Gerry Grimstone and Mr.Norman Keith Skeoch with the Board's approval following the date of the relevant BoardMeetings.

Independent Directors

The Company has six Independent Directors on the Board i.e. Dr. SA Dave Mr.Ravi Narain Mr. VK Viswanathan Mr. Prasad Chandran Mr. Sumit Bose and Mr.Ranjan Mathai. In accordance with the provisions of the Act the Independent Directors arenot liable to retire by rotation and have been appointed for a term of 5 years from theirrespective appointment dates.

The Members may note that amongst the Independent Directors Dr. Dave has beennominated by HDFC Limited Holding Company of the Company in line with the provisions ofRegulation 24 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015which requires a listed company to nominate at least one of its Independent Directors onthe Board of its material unlisted Indian subsidiary.

Re-appointment of Ms. Vibha Padalkar

The Members may note that Ms. Vibha Padalkar Executive Director & ChiefFinancial Officer was appointed on August 14 2012 by the Shareholders of the Companyand as approved by the IRDAI for a period of 5 years. Accordingly her term as ExecutiveDirector & Chief Financial Officer expires on August 13 2017. The proposal forher re-appointment has been recommended by the Nomination & Remuneration Committeeand approved by the Board of Directors. The said proposal is being proposed forShareholders' approval at the ensuing 17th Annual General Meeting andthe relevant disclosures with regards to her re-appointment as Executive Director& Chief Financial Officer have been included as part of the Notice of the 17thAnnual General Meeting. The said re-appointment is also subject to IRDAI's approval.

Declaration by Independent Directors

The Independent Directors of the Company have confirmed that they satisfy the criteriaof prescribed for Independent Director as stipulated in Section 149(6) of the Act.

Directors retiring by rotation (being Directors other than Independent Directors)

In accordance with the provisions of the Act read with the Articles of Association ofthe Company Ms. Renu Sud Karnad and Mr. Norman Keith Skeoch being non-IndependentDirectors are liable to retire by rotation at the ensuing 17th Annual GeneralMeeting of the Company. They are eligible for re-appointment. Resolutions for thepurpose of their re-appointments are being proposed at the 17th Annual GeneralMeeting. Profiles of these Directors are included in the Notice of the 17thAnnual General Meeting.

‘Fit and Proper' criteria

All the Directors have confirmed compliance with the ‘fit and proper' criteriaprescribed under the Corporate Governance Guidelines issued by the IRDAI.

The Company has also received declarations from all its Directors as per Section 164 ofthe Act confirming they are not disqualified from being appointed as Directors of theCompany.

The details of the Board and Committee meetings and the attendance of Directorsthereat forms part of the Corporate Governance Report which is attached asAnnexure 1 to this Directors' Report.

Corporate Governance

A report on the Corporate Governance framework within the Company with requiredcertification as required under the IRDAI Regulations is enclosed hereto as Annexure 1and forms part of this Report.

Legal Update

During the FY 2017 no significant and material orders were passed by the regulatorscourts or tribunals that impacted the going concern status of the Company or which canpotentially impact the Company's future operations.

Key Managerial Personnel

Mr. Amitabh Chaudhry Managing Director and Chief Executive Officer; Ms. VibhaPadalkar Executive Director and Chief Financial Officer; and Mr. Manish Ghiya EVPCompany Secretary and Head – Compliance and Legal are designated as the "KeyManagerial Personnel" of the Company under the provisions of the Act.

There were no changes in the Key Managerial Personnel during FY 2017.

Risk Management Policy

The Company has a defined Risk Management Strategy and a Framework which is designed toidentify measure monitor and mitigate various risks. A Board approved RiskManagement Policy has been put in place to establish appropriate systems or procedures tomitigate all material risks faced by the Company. The said Policy is reviewedperiodically by the Risk Management Committee of the Board.

The risk management architecture of the Company has been detailed under the EnterpriseRisk Management section of the Annual Report.

Internal Audit Framework

The Company has institutionalised a robust and comprehensive internal auditframework/mechanism across all the processes to ensure reliability of financialreporting timely feedback on achievement of operational and strategic goals andcompliance with applicable policies procedures laws and regulations.

The Internal Audit function at HDFC Life works closely with other verticals inthe ARM (Audit and Risk Management) Group and other assurance functionsconsidering relevant material inputs from risk registers compliance reports and externalauditor reports etc. The function also tests and reports compliance to InternalFinancial Controls over Financial Reporting.

Internal audits are conducted by in-house Internal Audit team and co-sourcedauditors. The function also undertakes follow-up on engagement findings andrecommendations in line with the approved framework.

The Internal Audit function reports its findings and follow-up status on thesefindings to the Audit Committee on quarterly basis.

Internal Financial Controls

The Company has institutionalised a robust and comprehensive internal control mechanismacross all the major processes.

The Internal Audit in addition to ensuring compliance to policies regulationsprocesses etc. also test and report on adequacy of internal financial controlswith reference to financial reporting/statements.

Vigil mechanism

The Company has put in place a Whistleblower Policy and Framework. More detailsare provided in the Corporate Governance Report which is attached as Annexure 1 tothis Directors' Report.

Particulars regarding Conservation of Energy Technology Absorption and ForeignExchange Earnings and Outgo

Section 134 of the Act read with the Companies (Accounts) Rules 2014 requiresdisclosure of certain specified information pertaining to conservation of energytechnology absorption foreign exchange earnings and outgo in the Directors' Report.

The disclosure relating to conservation of energy does not apply to companies inthe Life insurance sector and hence the Company is exempted therefrom. Disclosurein respect of technology absorption and foreign exchange earnings and outgo isgiven below.

Technology Absorption

Specific areas in which R&D is carried out by the Company Not applicable
Benefits derived as a result of the above R&D Not applicable
Future plan of action Blockchain / Robotic process automation / Cognitive computing / Cyber security
Expenditure on R&D Not applicable
a) Capital
b) Recurring
c) Total
d) Total R&D expenditure as a percentage of total turnover
Technology absorption adoption and innovation
1. Efforts made towards technology absorption Major Initiatives Undertaken/Completed are:
• Revamped the Corporate Website and Customer Mobile Application
• Straight through processing for New Business processes
• Re-engineered processes for Customer and policy servicing
• Robotics Process Automation for payouts actuarial medicals and group business processes
• Optical Character Recognition (OCR)
• ISO 27001:2013 Re-certification
• Launched mobile version of online learning modules for employees
• 84 processes are being pursued for robotic process automation
2. Benefits derived as a result of the above efforts (eg product improvement cost reduction product development import substitution and so on) Benefits derived in terms of process / product improvement / cost reduction include:
Approximately 65% of the total New Business proposals are being submitted
through mobile applications
• Approximately 80% of Customer initiated payouts are being processed through Robotics Process Automation and have resulted in cutting Turn-Around-Time for over 50% cases to less than 5 days
• Response time cut by 50% for Customer Email communications
• 9 Retail products and 2 Group products were delivered this year adding to the revenue
• Roll out of Customer Consent Document in New Business process resulted in reducing 15+ pages of information requirements to a single page
• Straight through Processing has significantly reduced manual intervention required for document scrutiny
In case of imported technology (imported during the last three years reckoned from the beginning of the financial year) – Nil
i. The details of technology imported;
ii. The year of import;
iii. Whether the technology been fully absorbed;
iv. If not fully absorbed areas where absorption has not taken place and the reasons thereof
Expenditure incurred on Research and Development Nil

Foreign Exchange Earnings and Outgo

The details of foreign exchange earnings and outgo during the FY 2017 are as follows:

Earnings Rs. 70 Crs
Outgo Rs. 139 Crs

Subsidiary Companies

1. HDFC Pension Management Company Limited ("HDFC Pension")

Financials and Business Outlook

A synopsis of financial performance of HDFC Pension during FY 2017 is as below:

(Rs. Lacs)

Particulars FY 2017 FY 2016
Gross Income 243.6 239.6
Total Expenses 274.2 238.1
Profit before Tax (30.6) 1.5
Provision for Tax 0 0.3
Profit after Tax (30.6) 1.2

During the year under review AUM of the corporate and retail sector across all PensionFunds in the NPS architecture grew by 98% from Rs. 3563.9 Crs to Rs. 7017.7 Crswhich included funds of PSU Banks' employees where the Fund Manager was either of threeGovernment Sector PFMs.

HDFC Pension's AUM as on March 31 2017 stood at Rs. 1163.0 Crs i.e. a growth of 209%.HDFC Pension sourced 535 new Corporates in FY 2017. The Subscriber base under‘Corporate' sector category stood at 51920 in FY 2017 (i.e. a growth of 85% over FY2016) whereas the Subscriber base under retail sector stood at 78847 in FY 2017 (i.e. agrowth of 140% over FY 2016).

Legal matter

In January 2014 a fresh Request for Proposal ('RFP') was floated by the PFRDA seekingbids from Sponsors for selection of pension fund managers afresh to manage the pensionfunds. In response to the RFP HDFC Standard Life Insurance Company Limited (‘HDFCLife' / 'the Sponsor') had submitted its technical and commercial bid. The technical bidmade under RFP was opened in April 2014 and the bid submitted by the Sponsor was notaccepted by the PFRDA on technical grounds of not having profitability for a period of 3years. The Sponsor therefore filed a Writ Petition before the Hon'ble High Court ofDelhi challenging the said rejection. The Hon'ble High Court of Delhi by its Order datedMay 15 2014 quashed and set aside the PFRDA's rejection of the Sponsor's bid and directedthe PFRDA to evaluate the bid in accordance with the steps set out in the RFP. While thePFRDA cleared the Sponsor's technical and commercial bid and the Sponsor even agreed tomatch the lowest commercial bid the PFRDA declined to grant the Sponsor a 'Letter ofAppointment'. The Sponsor therefore filed another Writ Petition before the Hon'ble HighCourt of Delhi against the rejection. Vide its Order dated December 18 2014 the Hon'bleHigh Court of Delhi quashed and set aside the PFRDA's rejection of the Sponsor's bid anddirected the PFRDA to grant HDFC Life a 'Letter of Appointment' to act as a Sponsor.Subsequently the PFRDA has filed a Special Leave Petition before the Hon'ble SupremeCourt of India challenging the above said Order dated December 18 2014. The Hon'bleSupreme Court by its Order dated March 9 2015 refused to grant the PFRDA any ad-interimrelief and the matter is presently pending hearing. On March 27 2015 complying with theHigh Court order the PFRDA had issued a 'Letter of Appointment' in favour of the Companystating inter alia that such appointment is subject to the outcome of the aboveproceedings filed before the Hon'ble Supreme Court.

It may be noted that the PFRDA (Pension Fund) Regulations 2015 were notified in May2015 pursuant to which re-registration of all pension funds was sought by the PFRDA. HDFCPension has submitted its application for the same and a response from the PFRDA isawaited. However vide a letter dated June 24 2016 the PFRDA while acknowledging oursubmission of Annual Fees had granted an extension to continue as a Pension Fund untilthe selection of Pension Funds in terms of process specified under PFRDA (Pension Fund)Regulations 2015. This extension was subject to the Order of the Supreme Court of Indiaon the appeal filed by PFRDA against the Order of the High Court of Delhi describedabove.

During the year under review the PFRDA issued a fresh Request For Proposal(‘RFP') for selection of Pension Funds for private sector pursuant to which theSponsor had submitted a Technical and Commercial bid. On November 29 2016 the PFRDAissued a notice that the Commercial Bid would be opened on November 30 2016 wherein thename of HDFC Life was included which implies that the Technical Bid of HDFC Life asa Sponsor has been accepted. HDFC Life is also given to understand that theCommercial Bid submitted by HDFC Pension has also been accepted by the PFRDA andformal issuance of letters of appointment is awaited by all Companies.

2. HDFC International Life and Re Company Limited ("HDFCInternational")

In FY 2016 HDFC Life established HDFC International Life and Re Company Limited(‘HDFC International') a Wholly Owned Subsidiary in the Dubai InternationalFinancial Centre (DIFC) to capitalise on emerging business opportunities in view of thesignificant NRI population residing in the region.

HDFC International was established with the primary objective of offering lifereinsurance capacity in the UAE and other GCC nations. The license granted to HDFCInternational allows "Effecting Contracts of Insurance and Carrying out Contracts ofInsurance" in respect of life insurance classes.

During the year under review HDFC International has commenced business operations andinked two individual life reinsurance treaties in the UAE. HDFC International has alsostarted offering reinsurance capacity for Group Life and Credit Life arrangements acrossthe GCC region.

Financials and Business Outlook

During the first Financial year HDFC International earned a Gross Income of US$354192 while its expenses stood at US$ 1327218. The period under review ended with aloss of US$ 973027. The financial performance numbers are for the period fromJanuary 10 2016 to March 31 2017.

During the period under review HDFC International signed reinsurance treaties for twodistinct lines of individual life business with one of the largest local insurers in theUAE. It also offered reinsurance capacity for two group life schemes also with the sameceding insurer.

HDFC International also returned a modest Underwriting Income (Technical Profit) whichis testimony to the strength of its underlying underwriting and risk assessment processes.

In the years to come HDFC International intends to expand its footprints by offeringreinsurance capacity to ceding life insurers in other markets. By combining anaggressive outreach into other markets with its ever improving underwritingexperience it expects to significantly improve its revenue streams in FY 2018.

Swabhimaan / Corporate Social Responsibility

As part of its initiatives under Corporate Social Responsibility("CSR") the Company has undertaken projects in various areas includingEducation Livelihood Health and Rural Development. These Projects are undertaken inline with the CSR Policy and are in accordance with Schedule VII of the Act readwith the Rules framed under the said Act.

A more detailed write-up including details of the CSR projects undertaken theirmonitoring details on the implementing agencies amounts spent and the requisiteResponsibility Statement are given in Annexure 2 of this Report and forms part ofthis Directors' Report.

Annual Return

As per the provisions of the Act an extract of the Annual Return of the Company(in the prescribed Form MGT.9) has been attached as Annexure 3 to the Directors' Reportand forms part of this report.

Related Party Transactions

As per Section 177 read with Section 188 of the Act the Audit Committee of theBoard of Directors approves the related party transactions of the Company on a quarterlybasis. Related party transactions entered during the year under review were in theordinary course of business and on an arm's length basis thus not requiring Board/Shareholders' approval.

M/s GM Kapadia & Co Chartered Accountants reviewed the related partytransactions for each quarter and their report is placed at the meeting of theAudit Committee along with details of such transactions.

As per Accounting Standard (AS) 18 on ‘Related Party Disclosures' the details ofrelated party transactions entered into by the Company are also included inthe Notes to Accounts.

Ind AS Roadmap

The Ministry of Corporate Affairs (MCA) issued a press release on January 18 2016announcing the Indian Accounting Standards (Ind AS) roadmap for banking insurance andNon-Banking Financial Companies (NBFCs) requiring companies to prepare Ind ASbased standalone and consolidated financial statements for FY 2019 with comparatives ofFY 2018. Consequently IRDAI issued a circular dated March 1 2016 to guideand facilitate insurance companies towards Ind AS implementation. In compliancewith the above circular the Company has formed a Steering Committee headed by ExecutiveDirector and Chief Financial Officer along with members from cross-functionalareas to initiate Ind AS implementation process in the Company. The Companyhas also nominated the nodal officer to IRDAI to facilitate smooth implementationof Ind AS.

During the year in accordance with IRDAI's direction to few shortlistedinsurance companies the Company performed a test run to carry out an impact studyand identify issues in the preparation of the proforma financial statements as per Ind ASand submitted our results with key recommendations to IRDAI. In accordance with the abovereferred circular dated March 1 2016 the Company started submitting the proformaInd AS financial statements from quarter ended December 31 2016 to IRDAI. During theyear IRDAI issued Exposure Draft of IRDAI (Preparation of Financial Statements ofInsurers) Regulations 2017 based on the report of the ‘Implementation Group on IndAS' formed by IRDAI. In accordance with the requirement the Company submitted itscomments/suggestions to IRDAI on the said exposure draft. The final regulationsfrom IRDAI are awaited.

The Company has prepared a broad roadmap for Ind AS implementation covering theaspects related to evaluation of Ind AS technical requirements systems and processesbusiness and people impact and project management. The Audit Committee of the Board isoverseeing the progress of the Ind AS implementation process and reports to the Board atquarterly intervals.

Secretarial Audit Report

The Secretarial Audit as required under the Act was undertaken by M/s NL Bhatia &Associates Practising Company Secretary. The Auditor has not made any qualificationreservation or adverse remark or disclaimer in his Reports for FY 2017.

The Secretarial Audit Report for the FY 2017 is enclosed hereto as Annexure 4and forms part of this Report


M/s Price Waterhouse Chartered Accountants LLP and M/s GM Kapadia & Co CharteredAccountants are the Joint Statutory Auditors of the Company.

The Joint Statutory Auditors have not made any qualification reservation or adverseremark in their report for FY 2017.

As per the IRDAI Regulations a Statutory Auditor can conduct audit of an insuranceCompany for a maximum period of 5 years at a time. Further as per the Actan audit firm can be appointed as Statutory Auditor for not more than two terms offive consecutive years.

Thus in accordance with the IRDAI Regulations read with the provisions of theAct the appointment of M/s Price Waterhouse Chartered Accountants LLP was ratified andsubject to annual ratifications is valid upto the conclusion of the 19thAGM at the last AGM. This was in view of M/s Price Waterhouse CharteredAccountants LLP having already completed 2 years of office at the time of appointmentat the last AGM held on July 14 2016. Further M/s GM Kapadia & Co CharteredAccountants were newly appointed for a term of 5 years i.e. upto the conclusionof the 21st AGM at the preceding AGM.

Accordingly in view of the provisions of the Act and IRDAI Regulations theShareholders are requested to ratify the appointments of M/s Price WaterhouseChartered Accountants LLP and M/s GM Kapadia & Co Chartered Accountants for FY 2017.

The Joint Statutory Auditors being M/s Price Waterhouse Chartered Accountants LLP andM/s GM Kapadia & Co Chartered Accountants have confirmed their eligibility to act asStatutors Auditors. The Resolution for ratification of their appointments is included inthe Notice of the ensuing Annual General Meeting.


The Company has not accepted any deposits during the year under review.

Loans guarantees or investments

In terms of the provisions of sub-Section 11 of Section 186 of the Act readwith the clarification given by the Ministry of Corporate Affairs under the Removal ofDificulty Order dated February 13 2015 the provisions of Section 186 of the Act relatingto loans guarantees and investments do not apply to the Company.

Employees Stock Option Scheme

In line with the practice of incentivizing the employees through issue of stockoptions the Company has in the past granted stock options and continues to grant stockoptions to its eligible employees (including employees of its subsidiary companies)under the various employee stock option schemes formulated from time to time.

During the year under review there were no instances of loan granted by the Company toits employees for purchasing/ subscribing its shares.

In line with the requirements under the Act the Company has formulated EmployeeStock Option Scheme(s) 2014 2015 and 2016 for the purpose of administering the issue ofStock Options to the eligible Employees as mentioned above. In line with the disclosurerequirements under the Act the various components of the Scheme including Optionsgranted during the FY 2017 as on March 31 2017 are as below:

Details of Options Employees Stock Option Scheme 2014 (granted in FY 2015) Employees Stock Option Scheme 2015 (granted in FY 2016) Employees Stock Option Scheme 2016 (granted in FY 2017)
Number of Options granted 15034250 9733300 3836850
Number of Options vested 8244720 2851590 -
Number of Options exercised 3181037 414150 -
The total number of shares arising as a result of exercise of Options 3181037 414150 -
Options lapsed 847232 313200 4000
Exercise Price Rs. 90/- per share Rs. 95/- per share Rs. 190/- per share
Variation of Terms of Options - -
Money realised by exercise of options 286293330 39344250 -
Total number of Options in force 11005981 9005950 3832850
Employee wise details of Options granted to
a. Key Managerial Personnel - - Please refer to Annexure 3 - MGT.9 for Options granted during the FY 2017
b. Any other employee who receives a grant of options in any one year of options amounting to five percent or more of options granted during that year. - - -
c. Identified employees who were granted options during any one year equal to or exceeding one percent of the issued capital (excluding outstanding warrants and conversions) of the Company at the time of grant. - - -

Material changes and Commitments affecting the financial position

There have been no material changes and commitments affecting the financial positionof the Company which have occurred between the end of the financial year of the Companyto which the Balance Sheet relates and the date of this report.

Directors' Responsibility Statement

In accordance with the requirements of Section 134 of the Act the Board of Directorsstate that:

i. In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures (ifany);

ii. Such accounting policies have been selected and applied consistently and judgmentsand estimates made that are reasonable and prudent so as to give a true and fairview of the Company's state of aflairs as on March 31 2017 and of the Company's profitfor the year ended on that date;

iii. Proper and suficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

iv. The annual accounts have been prepared on a going concern basis; and v. Propersystems have been devised to ensure compliance with the provisions of all applicable lawsand such systems were adequate and operating effectively.

Appreciation and Acknowledgement

The Directors thank the policyholders customers distributors and business associatesfor reposing their trust in the Company. The Directors also thank the Company'semployees for their continued hard work dedication and commitment; and theManagement for continuing success of the business.

The Directors further take this opportunity to thank Housing Development FinanceCorporation Limited and Standard Life for their invaluable and continued supportand guidance. The Directors also thank the Insurance Regulatory and Development Authorityof India Reserve Bank of India Pension Fund Regulatory and Development Authority LifeInsurance Council and other governmental and other bodies and authorities for theirsupport advice and direction provided from time to time.

On behalf of the Board of Directors
Mumbai Deepak S. Parekh
May 3 2017 Chairman