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Indiabulls Real Estate Ltd.

BSE: 532832 Sector: Infrastructure
NSE: IBREALEST ISIN Code: INE069I01010
BSE 00:00 | 24 Apr 2020 Indiabulls Real Estate Ltd
NSE 05:30 | 01 Jan 1970 Indiabulls Real Estate Ltd

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OPEN 61.75
PREVIOUS CLOSE 61.75
VOLUME 877058
52-Week high 151.00
52-Week low 36.85
P/E
Mkt Cap.(Rs cr) 2,842
Buy Price 62.35
Buy Qty 1000.00
Sell Price 62.50
Sell Qty 1500.00
OPEN 61.75
CLOSE 61.75
VOLUME 877058
52-Week high 151.00
52-Week low 36.85
P/E
Mkt Cap.(Rs cr) 2,842
Buy Price 62.35
Buy Qty 1000.00
Sell Price 62.50
Sell Qty 1500.00

Indiabulls Real Estate Ltd. (IBREALEST) - Director Report


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Company director report

Dear Members

Your Directors have pleasure in presenting the Thirteenth Annual Report together withthe audited financial statements of accounts of the Company for the financial year endedMarch 31 2019.

Financial Highlights

The highlights of the consolidated financial results of the Company for the financialyear ended March 31 2019 are as under:

Amount (Rs in Lakhs)
Particulars Year ended March 31 2019 Year ended March 31 2018*
Profit before Depreciation / Amortisation 85722.88 279574.43
Less: Depreciation / Amortisation 1744.56 9650.79
Profit before Tax 83978.32 269923.64
Less: Provision for Tax 33945.91 33483.23
Profit after Tax before share of Profit / (Loss) from associates and Non controlling interest 50032.41 236440.41
Share of Profit / (Loss) from associates 399.11 (484.30)
Non controlling interest (16.95) 1328.41
Net Profit for the year 50414.57 237284.52

*Figures of March 31 2018 have been restated pursuant to applicability of IndAS 115'Revenue from Contracts with Customers' for reporting periods beginning on or after 1April 2018.

The highlights of the standalone financial results of the Company for the financialyear ended March 31 2019 are as under:

Amount (Rs in Lakhs)
Particulars Year ended March 31 2019 Year ended March 31 2018
Profit before Depreciation / Amortisation 15086.41 (1518.65)
Less: Depreciation / Amortisation 83.78 97.56
Profit before Tax 15002.63 (1616.21)
Less: Provision for Tax 4401.44 359.14
Profit after Tax 10601.19 (1975.35)

REVIEW OF BUSINESS OPERATIONS:

CREDIT RATING

The Company has during FY 2018-19 maintained its long term credit rating of AA-amongst the highest rated listed companies in the Indian real estate industry peer group.The Company has also retained A1+ rating for its short-term debt which is the highestrating that can be assigned for short-term debt. The ratings are the manifestation of theCompany's strong fundamentals low gearing and execution track record and mirror its longterm growth prospects.

COMPANY'S BUSINESS OVERVIEW

Indiabulls Real Estate is one of the largest real estate companies in India with awell-diversified presence in both commercial and residential real estate development andhas projects across the price spectrum from mid-income premium to the super luxuryspace. Geographically the Company's strategic focus is in key markets of MumbaiMetropolitan Region (MMR) and National Capital Region (NCR).

Development Portfolio

• 17 Ongoing Completed & Planned projects with total saleable area of 44.59million sqft.

• Projects execution to generate a Net Surplus of Rs 12907 cr. It excludes theLondon asset divestment which is to be completed in FY20.

Project Location Net Surplus (' Cr)
Ongoing Projects
Blu Estate & Club Worli MMR 3136
Indiabulls Greens Panvel MMR 869
Indiabulls Golf City Savroli MMR 1229
One Indiabulls Thane MMR 1017
Enigma Gurgaon NCR 240
One Indiabulls Gurgaon NCR 1050
Indiabulls One 09 Gurgaon 261
Indiabulls City Sonepat NCR 99
Indiabulls Seirra Vizag Vizag 29
Sub Total - Ongoing Projects 7930
Completed Projects
Centrum Park Gurgaon NCR 140
Mega Mall Jodhpur Jodhpur 236
One Indiabulls Park Vadodara Vadodara 75
Sub Total - Completed Projects 451
Planned Projects
Indiabulls Imperial Gurgaon (Sec 106) NCR 1930
Manesar NCR 1903
Arivali Panvel MMR 292
Silverlake Villas Alibaug MMR 69
Centrum Indore Indore 332
Sub Total - Planned Projects 4526
Grand Total 12907

Net Surplus = Pending Collections from Area Sold + Value of Unsold Inventory - PendingConstruction Cost

Office Rental Portfolio:

• Strong tenant relationships with 200+ marquee tenants consisting of top-tiercorporates from diverse sectors like financial services consulting legal educationpharma telecom media etc.

• On-going development projects of 2.44 million sqft to substantially grow theAnnuity Revenue.

Property Leasable Area (Mn. sqft) Annualised Annuity Revenue in FY 21-22 (' Cr)**
Commercial Development at Blu- Worli Mumbai 0.82 282
Indiabulls Mint Gurgaon 0.31 34
Sector 106 Gurgaon 1.31 144
Total 2.44 460

**Annualized Annuity Revenue on the basis of 98% occupancy. Our completed propertieshave 98% occupancy as on date

JV Portfolio with Blackstone:

• Your Company has further expanded its JV platform with Blackstone Group L.Pglobally renowned real estate private equity investor by adding 2 new assets namelyIndiabulls Tech Park Gurgaon and Indiabulls IT Park Gurgaon to the portfolio.

• One of the largest commercial portfolios aggregating to 5.01 million sqft.

Property Leasable Area (Mn. sqft) Annualised Annuity Revenue in FY 21-22 (' Cr)*
One Indiabulls Centre Mumbai 1.67 365
Indiabulls Finance Centre 1.67 325
Indiabulls Finance Centre New Tower Development 0.89 209
Indiabulls Tech Park Gurgaon 0.24 24
Indiabulls IT Park Gurgaon 0.54 82
Grand Total 5.01 1005

* Annualized Annuity Revenue on the basis of 98% occupancy. Our completed propertieshave 98% occupancy as on date

Delivery of Key Projects: Delivered 9.7 mn sqft with Occupation Certificate formultiple towers/projects - Blu Estate & Club (Mumbai) Indiabulls Greens (Panvel)Indiabulls Golf City (Savroli) Centrum Park (Gurgaon) Enigma (Gurgaon) and Mega Mall(Jodhpur).

Land Bank - The Company has fully paid land bank of 1929 acres in key cities acrossIndia of which more than 95% of the Land Bank is in high value super-metro cities -Mumbai (MMR) National Capital Region (NCR) and Chennai and which is sufficient forproposed development over the next 5-7 years. In addition to the said land bank theCompany also possesses 1424 acres of SEZ land in Nashik Maharashtra.

Growth Strategy

• Company will focus on its core markets - Mumbai Metropolitan Region &National Capital Region for sustainable growth and strengthening of its on-goingbusinesses.

• Regular sales from the under construction office properties to Investors anddeploy funds to acquire land parcels/ unfinished projects for development.

• Company will focus on asset light model through JV development with landowners/other developers without incurring significant upfront land acquisition cost.

0 Unexploited Land Bank - 1929 acres of fully paid land spread across Mumbai NCRChennai and additional 1424 acres of Nashik SEZ. The land bank has the growth potentialfor Development & Rental portfolio and worth atleast Rs 5000 Cr on replacement valuebasis.

Zero Net Debt in FY20

• Your Company has embarked on a clear and simple path to achieve Zero Net Debt inthe current financial year through the following steps -

• Unlock the value of 'Commercial and Leasing' business - Strategic divestment ofthese assets with Third Party Investors/internationally renowned Private Equity players.The expected Equity Value would be ~ Rs 4400 Cr - Rs 4800 Cr.

• Divest Hanover Square property London - In light of continuing Brexit relatedissues and uncertainty around it the London property market remains sluggish and theLondon asset divestment would release an Enterprise Value of 200 million.

• The above steps will generate over Rs 6000 Cr thereby reducing the Net Debt ofIndiabulls Real Estate to Zero in the current financial year and leaving surplus cash forfurther growth of the Company.

SIGNIFICANT EVENTS DURING FINANCIAL YEAR 2018-19 AND SUBSEQUENT THERETO

Buy-back Offer of Equity shares of the Company

Pursuant to the authorization of its Board the Company commenced the Buy-back of up to2.6 Cr fully paid-up Equity shares of the Company being approx. 5.45% of the thenexisting paid-up share capital of the Company at prevailing market price on StockExchanges subject to a price not exceeding Rs 240 per equity share aggregating up to anamount not exceeding Rs 624 Cr being less than 10% of total paid-up share capital andfree reserves of the Company (excluding all "Transaction Costs") from the openmarket through the Stock Exchange mechanism in accordance with SEBI (Buy Back ofSecurities) Regulations 1998 as amended. During the buyback offer which remained openfrom June 5 2018 till August 17 2018 the Company bought back 2.6 Cr Equity shares fromthe Exchanges for an aggregate value of Rs 443.18 Cr excluding transaction costs(against the maximum buy-back size of '624 Cr) at an average price of approx. Rs 170.45per equity share (against the maximum buy-back price of Rs 240 per equity share).

Sale of Commercial Assets in non-core market

Pursuant to the earlier authorization of the shareholders dated 23rd March 2018 theCompany has during the FY 2018-19 entered into definitive agreement(s) for divestment ofits 100% stake in the business of commercial assets at Ambattur Chennai ("ChennaiAssets") being non-core real estate business operations for the Company toBlackstone Group L.P. which is a globally renowned real estate private equity investor("Blackstone") at a gross value of approx. Rs 850 Cr subject to adjustments ifany basis certain assets and liabilities on closing. In terms of the definitiveagreement(s) the Company has divested its partial stake and balance is to be divested bySeptember 30 2019.

To facilitate the agreed divestment of Chennai Assets in tranches by simplifying thecorporate structure the Board of the Company approved a composite Scheme of Arrangementamongst the Company Indiabulls Infrastructure Limited a direct subsidiary and IndiaLand and Properties Limited a step down subsidiary company owning "ChennaiAssets". The Scheme has been approved by the shareholders and creditors of theCompany at their respective meetings held on 20th June 2019 convened under directions ofNational Company Law Tribunal Principal Bench New Delhi (NCLT) and is now to beconsidered by NCLT for granting its final approval. Upon effectiveness of the Schemethere shall not be any change in the shareholding pattern of the Company as the Companyshall not issue any shares or pay any consideration pursuant to said Scheme.

Acquisition of Commercial Assets at prime location in Gurugram and expansion of JVPortfolio with Blackstone Group L.P.

The Company through its wholly-owned subsidiary Ashkit Properties Limited acquired aprime commercial land admeasuring 13519 sq. mtrs. on National Highway 8 (Plot No 20situated in Sector 18 Urban Estate Gurugram) for a development of a commercial complexwith an expected leasable area of more than 5 lacs sqft. Another wholly- owned subsidiaryof the Company Yashita Buildcon Limited acquired 100% stake in Concept InternationalIndia Pvt Ltd owning prime commercial property on National Highway 8 (Plot No 422Bsituated in Sector 18 Urban Estate Gurugram) which is a developed commercial complexwith leasable area of approx 2.5 lac sqft.

To expand the existing JV portfolio with Blackstone the Company entered intodefinitive JV agreements with Blackstone and accordingly divested 50% stake in these twooffice assets at an aggregate enterprise value of approximately INR 464 Crores.

Acquisition of land parcel/development rights at Manesar. Gurugram

The Company through its wholly-owned subsidiary Loon Land Development Limited enteredinto definitive agreement(s) to acquire a land parcel/development rights on approx. 140acre land situated at Sector 79 Manesar Gurugram for development of integratedtownship and commercial building.

Joint Development at Worli Mumbai

The Company through its wholly owned subsidiary Indiabulls Infraestate Ltd("IIL") has executed a Term Sheet with Oricon Enterprises Limited (OEL) forjoint development of a commercial building on land parcel admeasuring approx. 3512 sq.mtrs. situated at Dr. E. Moses Road Worli Mumbai - 400018 through which IIL will getexclusive ownership rights of approx. 2.55 lac sqft leasable area.

DIVIDEND

In view of the business requirements of the Company the Board of Directors of theCompany has not recommended any dividend for financial year 2018-19.

During the year unclaimed dividend pertaining to the Financial Year 2010-11 amountingto Rs 405906/- and 61284 equity shares in respect of which dividend was not claimedfor seven consecutive years was transferred by the Company to Investor Education andProtection Fund (IEPF) after serving notices to concerned Members. Those members who havenot so far claimed their dividend for the subsequent financial years are also advised toclaim it from the Company or Karvy Fintech Private Limited.

In compliance with requirements stipulated vide SEBI notification no. SEBI/LAD-NRO/GN/2016-17/008 dated July 8 2016 the Dividend Distribution Policy of the Company isavailable on the website of the Company at web link https://www.indiabullsrealestate.com/policies/ .

DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the financial year 2018-19 Justice Bisheshwar Prasad Singh (Retd.) (DIN:06949954) and Brig. Labh Singh Sitara (Retd.) (DIN: 01724648) Independent Directorshaving attained the age of seventy five years resigned from the Directorship of theCompany w.e.f. March 31 2019 to comply with the requirements of Regulation 17(1A) ofSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 as amendedwhich came into effect from April 1 2019.

Further to have varied experience and skill sets in sync with highest standards ofCorporate Governance in the Board following individuals were appointed as AdditionalDirectors on the Board of the Company:

(a) Mr. Praveen Kumar Tripathi (DIN: 02167497) a retired IAS and Ex-Chief SecretaryGovt of NCT Delhi as an Independent Director of the Company for a period of three yearsw.e.f. March 31 2019; and

(b) Mr. Gurinder Singh (DIN: 08183046) a retired IPS as an Independent Director ofthe Company for a period of three years w.e.f. March 31 2019.

Mr. Praveen Kumar Tripathi and Mr. Gurinder Singh being additional director(s) holdoffice as such upto the date of ensuing Annual General Meeting. Keeping in view theirexcellent leadership and guidance abilities skills vast professional experience indiversified fields including management administration regulatory public policy mattersetc the Board recommends their appointment as an Independent Director of the Company notliable to retire by rotation for a period of three years w.e.f. March 31 2019. Upongetting approval of the shareholders for their appointment as Independent Directors theirappointment shall be formalized by issuing a letter of appointment to them which shall beopen for inspection by the members at the registered office of the Company in terms ofapplicable provisions of the Companies Act 2013.

All the Independent Directors of the Company have given confirmation that they meet thecriteria of independence laid down under Section 149(6) of the Companies Act 2013.

In accordance with the provisions of the Companies Act 2013 and in terms of theArticles of Association of the Company Mr. Gurbans Singh (DIN: 06667127) an ExecutiveDirector designated as Joint Managing Director is liable to retire by rotation at theensuing Annual General Meeting of the Company and being eligible has offered himself forreappointment.

Further since the current tenure of Mr. Narendra Gehlaut (DIN: 01246303) an ExecutiveDirector designated as Vice-Chairman of the Company Mr. Gurbans Singh (DIN: 06667127)and Mr. Vishal Gaurishankar Damani (DIN: 00358082) Executive Directors designated asJoint Managing Directors of the Company shall come to end on January 8 2020 September28 2019 and August 26 2020 respectively to ensure continuity of guidance and benefitsof their management and operational skills the Board recommends their re-appointments atcurrent designations for a further period of five years upon completion of theirrespective tenures.

The matter relating to appointment/ re-appointment of aforementioned directors havebeen included in the Notice of the 13th Annual General Meeting. Brief resume of theDirectors proposed to be appointed/re-appointed nature of their expertise in specificfunctional areas and names of companies in which they hold directorships and memberships/chairmanships of Board Committees and other requisite information are provided in theNotice convening the 13th Annual General Meeting of the Company.

SHARE CAPITAL / STOCK OPTIONS

The paid-up share capital of the Company as of March 31 2019 was Rs 901360578/-comprising of450680289 equity shares of Rs 2/- each. An aggregate of 6207950 stockoptions granted under Company's ESOP Schemes were in force as on March 31 2019 whichshall be exercisable as per the vesting schedule of respective ESOP Schemes.

Subsequently during the current FY 2019-20 till date the Company had allotted anaggregate 3983587 Equity shares of face value Rs 2/- each against exercise of equivalentnumber of stock options under an ESOP Scheme of the Company as a result of which the paidup equity share capital of the Company stands increased to Rs 909327752/- divided into454663876 equity shares of Rs 2/- each.

The disclosures required to be made regarding employees stock options in compliancewith the SEBI (Share Based Employee Benefits) Regulations 2014 have been placed on thewebsite of the Company http://www.indiabullsrealestate.com/ .

PUBLIC DEPOSITS

During the year under review the Company has not accepted any deposits from thepublic falling within the ambit of Chapter V of the Companies Act 2013 and the Companies(Acceptance of Deposits) Rules 2014 therefore the disclosures required in terms of Rule8 of the Companies (Accounts) Rules 2014 are not required to be given.

LISTING WITH STOCK EXCHANGES

The Equity Shares (ISIN No.: INE 069 I01010) of the Company continue to remain listedat BSE Limited and National Stock Exchange of India Limited. The listing fees payable toboth the exchanges for the financial year 2019-20 have been paid. The GDRs issued by theCompany continue to remain listed on Luxembourg Stock Exchange.

AUDITORS

(a) Statutory Auditors

The present term of M/s Walker Chandiok & Co. LLP (member firm of global accountingfirm Grant Thornton) (Firm Regn. No. 001076N/N500013) the Statutory Auditors of theCompany who were appointed by the members at their Eighth Annual General Meeting held onSeptember 29 2014 for a period of five years shall come to an end on the conclusion ofthe ensuing Thirteenth Annual General Meeting of the Company. It is proposed to reappointthe existing auditors M/s Walker Chandiok & Co. LLP (Firm Regn. No. 001076N/N500013)as the Statutory Auditors of the Company for a further period of five years i.e. from theconclusion of ensuing Thirteenth Annual General Meeting until the conclusion of theEighteenth Annual General Meeting of the Company. The Company has received a certificatefrom the Auditors to the effect that their continuation as such from the conclusion ofthis Annual General Meeting until the conclusion of Eighteenth Annual General Meeting ifapproved by the members will be in accordance with the provisions of the Section141(3)(g) of the Companies Act 2013.

The Auditors' Report is self-explanatory and therefore do not call for any furtherexplanation. No fraud has been reported by the Auditors of the Company in terms of theprovisions of Section 143(12) of the Companies Act 2013 and Rules framed thereunder.

(b) Secretarial Auditors & Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act 2013 read with therules made thereunder the Company had appointed M/s S. Khandelwal & Co. a firm ofCompany Secretaries in practice as its Secretarial

Auditors to conduct the secretarial audit of the Company for the Financial Year2018-19. The Company has provided all assistance facilities documents records andclarifications etc. to the Secretarial Auditors for conducting their audit. TheSecretarial Audit Report along with Secretarial Compliance Report as prescribed by SEBIfor the Financial Year 2018-19 are annexed as Annexure 1(i) and Annexure 1(ii)respectively and forms part of this Report. The Reports are self - explanatory andtherefore do not call for any further explanation.

The Secretarial Audit Report of the unlisted material subsidiary is annexed as Annexure1 (iii).

COST RECORDS

The requirement of maintenance of cost records as specified by the Central Governmentunder sub-section (1) of section 148 of the Companies Act 2013 read with applicableRules is applicable on the Company and accordingly such accounts and records have beenmade and are maintained by the Company.

CORPORATE SOCIAL RESPONSIBILITY

As part of its initiatives under "Corporate Social Responsibility (CSR)" theCompany has been undertaking projects in the areas specified under its CSR Policy(available on your Company's website at web link https://www.indiabullsrealestate .com/policies/) in accordance with Schedule VII of the Companies Act 2013 read with therelevant Rules. In terms of the applicable provisions of the Companies Act 2013 read withrelevant Rules since the Company had average net losses during immediately precedingthree financial years the Company was not required to contribute any amount towards CSRactivities during the FY 2018-19. An Annual Report on CSR containing relevant details isannexed as Annexure 2 forming part of this Report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Pursuant to Regulation 34 of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 as amended ("SEBI LODRRegulations") with the Stock Exchanges Management's Discussion and Analysis Reportfor the year under review is presented in a separate section forming part of this AnnualReport.

CORPORATE GOVERNANCE REPORT

Pursuant to Regulation 34 of the SEBI LODR Regulations with the Stock Exchanges aseparate section on Corporate Governance Practices followed by the Company together witha certificate from a practicing Company Secretary confirming compliance is presented in aseparate section forming part of this Annual Report.

BUSINESS RESPONSIBILITY REPORT

Pursuant to Regulation 34 of the SEBI (LODR) Regulations a Business ResponsibilityReport (BRR) is presented in a separate section forming part of this Annual Report.

DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors in terms of Section 134 of the CompaniesAct 2013 hereby states:

a) that in the preparation of the annual financial statements for the year ended March31 2019 the applicable accounting standards had been followed along with properexplanation relating to material departures if any;

b) that such accounting policies as mentioned in the Notes to the Financial Statementshave been selected and applied consistently and judgments and estimates have been madethat are reasonable and prudent so as to give a true and fair view of the state of affairsof the Company as at March 31 2019 and the profit and loss of the Company for the yearended on that date;

c) that proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;

d) that the annual financial statements have been prepared on a going concern basis;

e) that proper internal financial controls are in place and that such financialcontrols are adequate and are operating effectively; and

f) that systems to ensure compliance with the provisions of all applicable laws are inplace and are adequate and operating effectively.

EXTRACT OF ANNUAL RETURN

In terms of Sections 92(3) and 134(3) of the Companies Act 2013 and rules framedthereunder extract of the Annual Return for the financial year ended March 31 2019 inform MGT-9 are given in 'Annexure 3' forming part of this Report and is also available onthe website of the Company at web linkhttps://www.indiabullsrealestate.com/investor-relations/ .

BOARD MEETINGS

During the FY 2018-19 6 (Six) Board Meetings were convened and held. The details ofsuch meetings are given in Corporate Governance Report forming part of this Annual Report.The intervening gap between these meetings was within the period prescribed under theCompanies Act 2013 and other applicable provisions. The notice and agenda including allmaterial information and minimum information required to be made available to the Boardunder SEBI LODR Regulations were circulated to all directors well within the prescribedtime before the meeting or placed at the meeting with the permission of majority ofDirectors (including the Independent Directors). During the year separate meeting of theIndependent Directors was held on February 14 2019 without the presence ofNon-Independent Directors and the members of the Company Management.

PERFORMANCE EVALUATION OF THE BOARD ITS COMMITTEES AND DIRECTORS

The Nomination & Remuneration Committee (NRC) of the Board reassessed theframework methodology and criteria for evaluating the performance of the Board as awhole including Board committee(s) as well as performance of each director(s) andconfirms that the existing evaluation parameters are in compliance with the requirementsas per SEBI guidance note dated January 5 2017 on Board evaluation. The existingparameters includes effectiveness of the Board and its committees decision makingprocess Directors/members participation governance independence quality and content ofagenda papers team work frequency of meetings discussions at meetings corporateculture contribution role of Chairman and management of conflict of interest. Basisthese parameters the NRC had reviewed at length the performance of each directorindividually and expressed satisfaction on the process of evaluation and the performanceof each Director. The performance evaluation of the Board as a whole and its committeesnamely Audit Committee Nomination & Remuneration Committee and Stakeholders'Relationship Committee as well as the performance of each director individuallyincluding the Chairman was carried out by the entire Board of Directors. The performanceevaluation of Non-independent Directors and the Board as a whole was carried out by theIndependent Directors at their meeting held on February 14 2019. The Directors expressedtheir satisfaction with the evaluation process.

Also the Chairman of the Company on a periodic basis has had one-to-one discussionwith the directors for their views on the functioning of the Board and the Companyincluding discussions on level of engagement and contribution independence of judgmentsafeguarding the interest of the Company and its minority shareholders and implementationof the suggestions offered by Directors either individually or collectively duringdifferent board/committee meetings.

REMUNERATION POLICY

The Board has framed a policy for selection and appointment of Directors SeniorManagement and their remuneration. The Remuneration Policy is stated in the CorporateGovernance Report forming part of this Annual Report.

LOANS GUARANTEES OR INVESTMENTS

During the FY 2018-19 in terms of the provisions of Section 186 (1) of the CompaniesAct 2013 the Company did not make any investments through more than two layers ofinvestment companies.

The Company's investment/loans/guarantees during FY 2018-19 were in compliance withthe provisions of section 186 of the Companies Act 2013 particulars of which arecaptured in financial statements of the Company wherever applicable and required formingpart of this Annual Report.

RELATED PARTY TRANSACTIONS

During the year no materially significant related party transaction was entered by theCompany with its Promoters Key Managerial Personnel or other designated persons which mayhave potential conflict with the interest of the Company at large. Details of all relatedparty transactions are disclosed in the financial statement of the Company forming part ofthis Annual Report. None of the transactions with related parties is material transactionand/or transaction which is not at Arm's length requiring disclosure pursuant to Section134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules 2014. ThePolicy on materiality of Related Party Transactions and also on dealing with suchtransactions is available on the website of the Company(http://www.indiabullsrealestate.com/ ).

TRANSFER TO RESERVES

In compliance with regulations as applicable to Buyback of Equity shares by theCompany during FY 2018-19 the Company has transferred Rs 520.00 Lakhs to CapitalRedemption Reserve.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an elaborate system of internal controls commensurate with its sizescale and operations which also covers financial controls financial reporting fraudcontrol compliance with applicable laws and regulations etc. Regular internal audits areconducted to check and to ensure that responsibilities are discharged effectively. TheInternal Audit Department monitors and evaluates the efficacy and adequacy of internalcontrol systems in the Company its compliance with regulatory directives efficacy of itsoperating systems adherence to the accounting procedures and policies of the Company andits subsidiaries. Wherever required the internal audit efforts are supplemented by auditsconducted by specialized consultants/audit firms. All financial and audit control systemsare also reviewed by the Audit Committee of the Board of Directors of the Company. Basedon the report of the internal auditors process owners undertake corrective actions intheir respective areas and thereby strengthen the controls.

MATERIAL CHANGES AND COMMITMENTS

Other than those disclosed in this report there are no material changes andcommitments affecting the financial position of the Company which has occurred betweenthe end of the Financial Year of the Company i.e. March 31 2019 and the date of thisReport.

Further no significant and material orders were passed by the regulators or courts ortribunals impacting the going concern status and Company's operations in future.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy technology absorption and foreign exchangeearnings and outgo is as under:

A. Conservation of Energy

The Company operations do not account for substantial energy consumption. However theCompany is taking all possible measures to conserve energy. As an ongoing process thefollowing measures are undertaken:

a) Replacing all of its lighting system with LEDs which is expected to slash relatedelectricity consumption by over 50%.

b) Installation of five star energy conservation air conditioning systems.

c) Installation of automatic power controllers to save maximum demand charges andenergy.

d) Installation of TFT monitors that saves power.

e) Periodic Training sessions for employees on ways to conserve energy in theirindividual roles.

B. Technology Absorption

The nature of business being carried out by the Company entails an extensive use ofeffective information technology so as to ensure that its services reach the end usersi.e. its clients without any loss of time. The Company has implemented best of the classapplications to manage and automate its business processes to achieve higher efficiencydata integrity and data security. It has helped it in implementing best business practicesand shorter time to market new schemes products and customer services.

The Company's investment in technology has improved customer services reducedoperational costs and development of new business opportunities.

C. Foreign Exchange Earnings and Outgo

During the year under review there were no foreign exchange earnings. Details of theforeign exchange outgo during the year (last year Nil) are given below:

Particulars Amount in INR
Subscription Charges 145100.00
Technical Support Expenses 188120.30
Total 333220.30

BUSINESS RISK MANAGEMENT

Pursuant to the applicable provisions of the Companies Act 2013 the Company hasformulated robust Business Risk Management framework to identify and evaluate businessrisks and opportunities. This framework seeks to create transparency minimize adverseimpact on its business objectives and enhance its competitive advantage. It defines therisk management approach across the Company and its subsidiaries at various levelsincluding the documentation and reporting. At present the Company has not identified anyelement of risk which may threaten its existence. Based on the Market Capitalisation as onMarch 31 2019 the Company being one of the Top 500 listed entities has constituted aRisk Management Committee details of which are disclosed in the Corporate GovernanceReport forming part of this Annual Report.

PARTICULARS OF EMPLOYEES

Pursuant to the applicable provisions of the Companies Act 2013 read with Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 disclosures onManagerial Remuneration are provided in "Annexure 4" forming part of thisReport. In terms of the provisions of Section 136(1) of the Companies Act 2013 read withthe said Rules the Directors' Report is being sent to all the shareholders of the Companyexcluding the annexure on the names and other particulars of employees required inaccordance with Rule 5.2 of said rules which is available for inspection by the memberssubject to their specific written request in advance to the Company Secretary. Theinspection is to be carried out at the Company's Registered Office or at its CorporateOffice at Gurugram during business hours on working days of the Company up to date ofensuing Annual General Meeting.

FAMILIARISATION PROGRAMME FOR NON-EXECUTIVE DIRECTORS

Non-Executive Directors are familiarised with their roles rights and responsibilitiesin the Company as well as with the nature of industry and business model of the Companythrough presentations about the Company's strategy business model product and serviceofferings customers' & shareholders' profile financial details human resourcestechnology facilities internal controls and risk management their roles rights andresponsibilities in the Company. The Board is also periodically briefed on the variouschanges if any in the regulations governing the conduct of non-executive directorsincluding independent directors. The details of the familiarization programmes have beenhosted on the website of the company and can be accessed on the link:http://www.indiabullsrealestate.com/investor-relations/ .

SUBSIDIARY COMPANIES

Pursuant to Section 129 of the Companies Act 2013 the Company has prepared itsConsolidated Financial Statements along with all its subsidiaries in the same form andmanner as that of the Company which shall be laid before its ensuing 13th Annual GeneralMeeting along with its Standalone Financial Statements. The Consolidated FinancialStatements of the Company along with its subsidiaries for the year ended March 31 2019forms part of the Annual Report.

For the performance and financial position of each of the subsidiaries of the Companyalong with other related information required pursuant to Rule 8(5)(iv) of the Companies(Accounts) Rules 2014 the Members are requested to refer to the Consolidated andStandalone Financial Statements of the Company along with the statement pursuant tosection 129(3) of the Companies Act 2013 forming part of the Annual Report.

Further pursuant to the provisions of Section 136 of the Act the financial statementsof the Company consolidated financial statements along with relevant documents andseparate audited accounts in respect of subsidiaries are also available on the website ofthe Company. Shareholders may write to the Company for the annual financial statements anddetailed information on subsidiary companies. Further the documents shall also beavailable for inspection by the shareholders at the registered office of the Company. Fornames of companies which became or ceased to be subsidiaries or associate companies duringthe year ended March 31 2019 please refer to Form MGT-9 annexed to this Report.

COMMITTEES OF THE BOARD

In compliance with the relevant provisions of applicable laws and statutes the Companyhas the following Board constituted committees:

a) Audit Committee

b) Nomination and Remuneration Committee

c) Stakeholders Relationship Committee

d) Corporate Social Responsibility Committee

e) Risk Management Committee

The details with respect to composition power role terms of reference etc. of eachof these committees are given in the Corporate Governance Report forming part of thisAnnual Report.

In addition the Board has also constituted Compensation Committee for administrationof stock options Operations Committee and Management Committee for dealing with variousadministrative and operational matters and Restructuring Committee for reorganisation ofbusiness segments of the Company.

SECRETARIAL STANDARDS

The Board of Directors state that the Company has complied with the applicableSecretarial Standards (SS-1 and SS-2) respectively relating to Meetings of the Board itsCommittees and the General Meetings as issued by the Institute of Company Secretaries ofIndia.

NUMBER OF CASES FILED IF ANY AND THEIR DISPOSAL UNDER SECTION 22 OF THE SEXUALHARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT 2013

The Company has zero tolerance towards sexual harassment at the workplace and hasadopted a policy on prevention prohibition and redressal of sexual harassment atworkplace and has constituted an Internal Complaints Committee in line with theprovisions of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 and the Rules thereunder. During the financial year 2018-19 no casesof sexual harassment were reported. The Company has complied with provisions relating tothe constitution of Internal Complaints Committee (ICC) under the Sexual Harassment ofWomen at Work place (Prevention Prohibition and Redressal) Act 2013. The InternalComplaints Committee (ICC) has been set up to redress complaints received if anyregarding sexual harassment.

VIGIL MECHANISM

The Company is committed to adhere to the highest standards of ethical moral and legalconduct of its business operations. To maintain these standards the Company hasimplemented the Whistle Blower Policy ("the Policy") to provide an avenue foremployees to report matters without the risk of subsequent victimization discriminationor disadvantage. The Policy applies to all employees working for the Company and itssubsidiaries. Pursuant to the Policy the whistle blowers can raise concerns relating tomatters such as breach of Company's Code of Conduct fraud bribery corruption employeemisconduct illegality misappropriation of Company's funds / assets etc. Awhistle-blowing or reporting mechanism as set out in the Policy invites all employees toact responsibly to uphold the reputation of the Company and its subsidiaries. The Policyaims to ensure that serious concerns are properly raised and addressed and are recognizedas an enabling factor in administering good governance practices. The details of theWhistle Blower Policy are available on the website of the Company(http://www.indiabullsrealestate.com ).

GREEN INITIATIVES

Electronic copies of the Annual Report 2018-19 and Notice of the 13th AGM are beingsent to all the members whose email addresses are registered with the Company / DepositoryParticipant(s). For members who have not registered their email addresses or havesubmitted requests with the Company physical copies of the Annual Report 2018-19 andNotice of the 13th AGM are being sent in the permitted mode.

The Company is providing e-voting facility to all members to enable them to cast theirvotes electronically on all resolutions set forth in the Notice of the 13th AGM. This ispursuant to section 108 of the Companies Act 2013 read with applicable Rules and inaccordance with the SEBI LODR Regulations. The instructions for e-voting are provided inthe AGM Notice.

ACKNOWLEDGEMENT

Your Company has been able to operate efficiently because of the culture ofprofessionalism creativity integrity and continuous improvement in all functional areasand the efficient utilization of all its resources for sustainable and profitable growth.Your Directors wish to place on record their appreciation of the contributions made andcommitted services rendered by the employees of the Company at various levels. YourDirectors also wish to express their gratitude for the continuous assistance and supportreceived from the investors clients bankers regulatory and government authoritiesduring the year.

For and on behalf of the Board of Directors

Date: August 14 2019 Sd/- Sd/-
Place: Gurugram Gurbans Singh Vishal Gaurishankar Damani
Joint Managing Director Joint Managing Director
(DIN: 06667127) (DIN: 00358082)


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