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HCL Technologies

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Directors Report Year End : Mar '16    « Jun 15
Dear Shareholders,
 
 The Directors have immense pleasure in presenting the Twenty Fourth
 Annual Report together with the audited financial statements for the
 year ended March 31, 2016 (nine months period from July 1, 2015 to
 March 31, 2016 hereinafter referred as ''Financial Year'').
 
 1.  FINANCIAL RESULTS
 
 Key highlights of the financial results of your Company for the year
 ended March 31, 2016 are as under:
 
 (Rs. in crores)
 
 Particulars                      Consolidated                Standalone
 
                              Year ended                  Year ended
 
                       31st March   30th June,   31st March   30th June,
                             2016         2015         2016         2015
                            (Nine      (Twelve        (Nine      (Twelve
                           months)      months)      months)      months)
 
 Total Income           31,676.24    37,840.68    14,402.11    18,352.94
 
 Total Expenditure      24,707.10    28,723.62     8,634.50    10,654.40
 
 Profit before 
 tax                     6,969.14     9,117.06     5,767.61     7,698.54
 
 Provision for tax      (1,363.89)   (1,815.11)   (1,033.93)   (1,352.59)
 
 Share of profit of 
 associates                 56.20        39.90            -            -
 
 Profit for the 
 year                    5,661.45     7,341.85     4,733.68     6,345.95
 Profit attributable 
 to
 
 Owners of the Company   5,643.04     7,317.07            -            -
 
 Share of profit of 
 minority interest          18.41        24.78            -            -
 
 2.  RESULTS OF OPERATIONS AND THE STATE OF COMPANY''S AFFAIRS
 
 On a standalone basis, the Company achieved revenue of Rs. 14,402.11
 crores in the nine months'' period from July 1, 2015 to March 31, 2016
 and a profit of Rs. 4,733.68 crores in the said financial year.
 
 On a consolidated basis, the Company achieved revenue of Rs. 31,676.24
 crores in the nine months'' period from July 1, 2015 to March 31, 2016
 and a profit of Rs. 5,661.45 crores in the said financial year.
 
 The state of affairs of the Company is presented as part of Management
 Discussion and Analysis Report forming part of this report.
 
 In accordance with the Companies Act, 2013 (the Act) and Accounting
 Standard (AS) - 21 on Consolidated Financial Statements read with AS -
 23 on Accounting for Investments in Associates and AS - 27 on Financial
 Reporting of Interests in Joint Ventures, the audited consolidated
 financial statements is provided in the Annual Report.
 
 The current financial year of the Company is for a nine months period
 from July 1, 2015 to March 31, 2016. The figures for the current
 financial year are therefore not comparable with those of the previous
 year.
 
 3.  DIVIDEND
 
 During the financial year ended March 31, 2016, your Directors had
 declared and paid three interim dividends as per the details given
 below:
 
 S.
 No. Interim dividend 
     paid during              Rate of dividend       Amount of
     the period from 
     July 1, 2015             per share (face        dividend paid
     to March 31, 2016        value of Rs. 2 
                              each)
 
 1.  1st Interim Dividend          Rs. 5                702.99
 
 2.  2nd Interim Dividend          Rs. 5                703.16
 
 3.  3rd Interim Dividend          Rs. 6                845.59 
 
     Total                                            2,251.74
 
 S.
 No  Interim dividend paid 
     during the period 
     from July 1, 2015 to 
     March 31, 2016           Dividend Distribution    Total Outflow
                              tax paid by the 
                              Company (Rs. in crores)
 
 1.  1st Interim Dividend           139.17                842.16
 
 2.  2nd Interim Dividend           139.18                842.34
 
 3.  3rd Interim Dividend           172.14               1017.73 
 
     Total                          450.49              2,702.23
 
 The Board of Directors in its meeting held on April 27-28, 2016, has
 declared an interim dividend of Rs. 6 per equity share of face value of
 Rs. 2 each for the year 2016-17. The Directors did not recommend final
 dividend for the year ended March 31, 2016.
 
 4.  TRANSFER TO RESERVES
 
 No amount was transferred to the General Reserve Account for the
 Financial Year.
 
 5.  CHANGES IN CAPITAL STRUCTURE
 
 Shares allotted under Employees Stock Option Plans
 
 During the year, the Company allotted 44,02,896 equity shares of Rs. 2
 each fully paid-up under its Employees Stock Option Plans.
 
 Issued and Paid-up share capital as on March 31, 2016
 
 As on March 31, 2016, the issued, subscribed and paid-up share capital
 of the Company was Rs. 2,820,762,628 divided into 1,410,381,314 equity
 shares of face value of Rs. 2 each.
 
 6.  DEBENTURES
 
 Your Company has not issued any fresh debentures during the financial
 year under review.
 
 7.  MANAGEMENT DISCUSSION AND ANALYSIS
 
 The Management Discussion and Analysis Report, in terms of Regulation
 34 (3) of SEBI (Listing Obligations and Disclosure Requirements)
 Regulations, 2015, is attached and forms a part of this Report.
 
 8.  SUBSIDIARIES/ACQUISITIONS
 
 As on March 31, 2016, the Company has 86 subsidiaries and 9 associate
 companies within the meaning of Section 2(6) of the Companies Act, 2013
 (Act). There has been no material change in the nature of the
 business of the subsidiaries.
 
 As per the provisions of Section 129(3) of the Act, a statement
 containing salient features of the financial statements of the
 Company''s subsidiaries (which includes associate companies and joint
 ventures) in Form AOC-1 is attached to the financial statements of the
 Company.
 
 As per the provisions of Section 136 of the Act, the standalone
 financial statements of the Company, consolidated financial statements
 along with relevant documents and separate audited accounts in respect
 of subsidiaries, are available on the website of the Company. The
 Company would provide the annual accounts of the subsidiaries and the
 related detailed information to the shareholders of the Company on
 specific request made to it in this regard by the shareholders.
 
 During the year, the Company had incorporated the following step down
 subsidiaries / associate companies (through Joint Venture): -
 
 S.
 No.  Name of Subsidiary Companies             Country of Incorporation
 
 1    HCL Technologies Czech Republic S.R.O.   Czech Republic
 
 2    HCL Muscat Technologies LLC              Oman
 
 3    HCL Joint Venture Holding Inc.           USA
 
 4    CeleritiFinTech Australia Pty. Limited   Australia
 
 5    CeleritiFinTech USA Inc.                 USA
 
 6    CeleritiFintech Italy S.R.L.             Italy
 
 7    CeleritiFinTech Germany GmbH             Germany
 
 8    CeleritiFinTech Limited                  United Kingdom 
 
      Name of Associate Companies
 
 9    CeleritiFinTech Services Limited         United Kingdom
 
 10   CeleritiFinTech Services USA Inc.*       USA
 
 11   CeleritiFinTech Services Australia Pty. 
      Limited*                                 Australia
 
 12   CeleritiFinTech Services Italy S.R.L.*   Italy
 
 13   CeleritiFinTech Services Germany, GmbH*  Germany
 
 14   CeleritiFintech Services India Pvt.
      Ltd.*                                    India 
 
 *CeleritiFintech Services Limited, UK is the holding Company of this
 Company.
 
 In addition to the above, the Company acquired 100% stake in HCL
 Training and Staffing Services Private Limited (HCLTSS), a company
 incorporated in India, engaged in the business of recruitment of
 engineers and rendering of training in the field of IT and ITES.
 
 HCL Technologies UK Limited, a step down subsidiary of the Company in
 UK acquired 100% stake in Point to Point Limited and Point to Point
 Products Limited (jointly referred to as P2P), the companies
 incorporated in UK, being a niche provider of complex workplace
 engineering services in UK.
 
 HCL Global Processing Services Limited, a subsidiary of the Company in
 India acquired 100% stake in Concept2Silicon Systems Private Limited
 (C2SiS), a Company incorporated under the Companies Act, 1956,
 engaged in providing complete solutions for complex system on Chip and
 System designs with best in class engineering capabilities and a
 cost-efficient business model.
 
 HCL America Inc., a step down subsidiary of the Company in USA,
 acquired the Powerteam LLC, a Delaware limited liability company
 (popularly known as PowerObjects), a leading North American solutions
 provider and a partner of Microsoft engaged in the business of
 developing, maintaining, licensing, consulting, servicing etc.  related
 to customer relationship management (CRM) using the Microsoft
 Dynamics suite of products.
 
 During the year, the Company has acquired the IT division of Volvo IT
 AB (''Volvo IT''), a subsidiary of AB Volvo, the holding company of the
 Volvo Group, which provides IT services to the Volvo group as well as
 non- Volvo group customers.
 
 The Company also acquired certain assets of privately held T rygstad
 Technical Services Inc. (Trygstad), a US based provider of IT
 consulting services & solutions to marquee customers, in an all cash
 deal. Trygstad Technical Services Inc. is a niche company with deep
 expertise in the areas of core engineering (including operating
 systems), Internet Of Things (IoT), Embedded Systems and Intelligent
 Systems.
 
 9.  DIRECTORS AND KEY MANAGERIAL PERSONNEL
 
 The Board of Directors consists of ten members, of which,one is the
 Promoter Director who is designated as the Chairman and Chief Strategy
 Officer of the Company. The other 9 Directors are Non- Executive
 Directors, of which 7 are Independent Non-Executive Directors. The
 Board also comprises of two women Directors.
 
 At the Annual General Meeting of the Company held on December 22, 2015,
 Mr. Thomas Sieber (DIN - 07311191) was appointed as an Independent
 Director of the Company in terms of section 149 of Companies Act, 2013,
 to hold office for a period of five years.
 
 The Independent Directors have furnished the certificate of
 independence stating that they meet the criteria of independence as
 mentioned under Section 149 (6) of the Act and Regulation 16 (1) (b) of
 the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
 2015.
 
 As per the provisions of Section 152 (6) of the Act, Ms. Roshni Nadar
 Malhotra (DIN 02346621) shall retire by rotation at the ensuing Annual
 General Meeting and being eligible, has offered herself for
 reappointment as the Director of the Company.
 
 10.  NUMBER OF MEETINGS OF THE BOARD
 
 During the year, four meetings of the Board were held. The details of
 the meetings are provided in the Corporate Governance Report.
 
 11.  FAMILIARIZATION PROGRAMME
 
 The details of familiarization programme have been provided under the
 Corporate Governance Report.
 
 12.  BOARD EVALUATION
 
 Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing
 Oblgation and Disclosure Requirements) Regulations, 2015, a formal
 Annual Performance evaluation is to be made by the Board of its own
 performance and that of the Committees and individual Directors. Also,
 Schedule IV of the said Act requires performance evaluation of
 Independent Directors by the Board, excluding the Director being
 evaluated.
 
 In view of the above, the annual performance evaluation was conducted
 by the Board on the basis of framework and criteria approved by the
 Nomination and Remuneration Committee of the Company. The process and
 criteria of evaluation is explained in the Corporate Governance Report,
 which forms part of this report.
 
 13.  AUDITORS
 
 M/s. S.R. Batliboi & Co. LLP, Chartered Accountants, were appointed as
 the Statutory Auditors of your Company in the Annual General Meeting
 held on December 4, 2014 for a term of five years until the conclusion
 of the Twenty Seventh AGM of the Company to be held in the year 2019.
 As per the provisions of Section 139 of the Act, the appointment of the
 Statutory Auditors is required to be ratified by Members at every
 Annual General Meeting. Accordingly, the appointment of M/s. S.R.
 Batliboi & Co. LLP, Chartered Accountants, as Statutory Auditors of the
 Company, shall be placed for ratification by the Members in the ensuing
 Annual General Meeting. In this regard, the Company has received a
 certificate from the Auditors to the effect that their re-appointment,
 if made, would be within the limits prescribed under Section 141 of the
 Companies Act, 2013 and that they are not disqualified for such
 reappointment within the meaning of the said section.
 
 14.  AUDITORS'' REPORT
 
 There are no qualifications, reservations or adverse remarks made by
 M/s. S.R. Batliboi & Co. LLP, Statutory Auditors in their report for
 the financial year ended March 31, 2016. The Statutory Auditors have
 not reported any incident of fraud to the Audit Committee of the
 Company in the year under review.
 
 15.  SECRETARIAL AUDIT REPORT
 
 In terms of Section 204 of the Act, M/s. Chandrasekaran Associates,
 Practicing Company Secretaries were appointed as the Secretarial
 Auditor of the Company. The report of the Secretarial Auditor is
 enclosed as Annexure 1 to this Report. The report is self-explanatory
 and does not call for any further comments. There are no
 qualifications, reservations or adverse remarks made by the Secretarial
 Auditor in their report for the financial year ended March 31, 2016.
 
 16.  EXTRACT OF ANNUAL RETURN
 
 Pursuant to Section 134(3)(a) and Section 92(3) of the Act, the extract
 of the Annual Return in Form MGT-9 is enclosed as Annexure 2 to this
 Report.
 
 17.  DIRECTORS'' APPOINTMENT AND REMUNERATION
 
 In accordance with the provisions of Companies Act, 2013, the
 Nomination and Remuneration Committee shall formulate the criteria for
 determining the qualifications, positive attributes and independence of
 Directors in terms of its charter.
 
 In evaluating the suitability of individual Board members, the
 Committee takes into account factors, such as Educational and
 professional background, General understanding of the Company''s
 business dynamics, Standing in the profession, Personal and
 professional ethics, integrity and values, Willingness to devote
 sufficient time and energy in carrying out their duties and
 responsibilities effectively.
 
 The Committee also assesses the independence of Directors at the time
 of appointment / re-appointment as per the criteria prescribed under
 the provisions of the Companies Act, 2013 and rules made thereunder and
 the SEBI (Listing Obligation and Disclosure Requirements) Regulations,
 2015.
 
 The Remuneration Policy for Directors, Key Managerial Personnel and
 other employees are provided in the Corporate Governance Report forming
 part of this report.
 
 18.  AUDIT COMMITTEE
 
 The Audit Committee comprises of four Independent Directors namely, Mr.
 Amal Ganguli, Ms. Robin Ann Abrams, Mr. Subramanian Madhavan and Mr.
 Keki Mistry. During the year, all the recommendations made by the Audit
 Committee were accepted by the Board.
 
 19.  RISK MANAGEMENT POLICY
 
 The Board of the Company has formed a Risk Management Committee to
 inter-alia assist the Board in overseeing the responsibilities with
 regard to the identification, evaluation and mitigation of operational,
 strategic and external environmental risks.  In addition, the Audit
 Committee is also empowered to oversee the areas of risks and controls.
 
 The Company has developed and implemented a Risk Management Policy that
 ensures the appropriate management of risks in line with its internal
 systems and culture.
 
 20.  INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY
 
 The Company''s internal financial control systems are commensurate with
 its size and the nature of its operations. The controls are adequate
 for ensuring the orderly and efficient conduct of the business and
 these controls are working effectively. These controls have been
 designed to provide reasonable assurance with regard to recording and
 providing reliable financial and operational information, adherence to
 the Company''s policies, safe-guarding of assets from unauthorized use
 and prevention and detection of frauds and errors.
 
 21.  SIGNIFICANT AND MATERIAL ORDERS
 
 There are no significant and material orders passed by the regulators
 or courts or tribunals impacting the going concern status and Company''s
 operations in future.
 
 22.  PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
 
 The particulars of loans, guarantees and investments have been
 disclosed in the financial statements.
 
 23.  TRANSACTIONS WITH RELATED PARTIES
 
 None of the transactions with related parties falls under the scope of
 Section 188(1) of the Act. Information on transactions with related
 parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of
 the Companies (Accounts) Rules, 2014 are given in Annexure 3 in Form
 AOC-2 and the same forms part of this Report. The Company also has in
 place a ''Related Party Policy'', which is available on the website of
 the Company.
 
 24.  CORPORATE SOCIAL RESPONSIBILITY
 
 The Corporate Social Responsibility (CSR) committee comprises of three
 members, namely Mr. Shiv Nadar, Ms. Roshni Nadar Malhotra and Mr.
 Subramanian Madhavan. The Committee is inter- alia responsible for
 formulating and monitoring the CSR Policy of the Company. A brief
 outline of the Corporate Social Responsibility (CSR) Policy of the
 Company and the initiatives undertaken by the Company on CSR activities
 during the year are set out in Annexure 4 of this Report in the form as
 prescribed in the Companies (Corporate Social Responsibility Policy)
 Rules, 2014. The Policy is available on the website of the Company.
 
 25.  TRANSFER OF UNPAID AND UNCLAIMED AMOUNTS TO IEPF
 
 Pursuant to the provisions of Section 124(5) of the Act, the dividend
 amounts which have remained unpaid or unclaimed for a period of seven
 years from the date of declaration have been transferred by the Company
 to the Investor Education and Protection Fund (IEPF) established by
 the Central Government pursuant to Section 125 of the Act. The details
 of unpaid/unclaimed dividend that will be transferred to IEPF in
 subsequent years are given in the Corporate Governance section of the
 Annual Report.
 
 26.  DEPOSITS
 
 Your Company has not accepted any deposits from public.
 
 27.  CORPORATE GOVERNANCE
 
 The Corporate Governance Report, in terms of Regulation 34 (3) of SEBI
 (Listing Obligations and Disclosure Requirements) Regulations, 2015,
 along with the Statutory Auditors certificate is attached and forms
 part of this Report.
 
 28.  BUSINESS RESPONSIBILITY REPORT
 
 The Securities and Exchange Board of India (SEBI) vide the SEBI
 (Listing Obligation and Disclosure Requirements) Regulations, 2015, has
 mandated inclusion of Business Responsibility Report (BRR) as part of
 the Annual Report for top 500 listed companies. However, pursuant to
 these regulations, if a listed Company publishes the Sustainability
 Report based on internationally accepted reporting framework along with
 a mapping of the BRR as stated in the said regulations, it would be
 treated as sufficient compliance of these regulations.
 
 For the financial year 2015-16, as the Company has prepared its
 sustainability report based on the internationally accepted reporting
 framework and the principles stated under the above SEBI regulations
 have been mapped with the Sustainability Report, no separate BRR has
 been prepared by the Company. The mapping and the Sustainability Report
 are available on our website at
 http://www.hcltech.com/socially-responsible-business.
 
 29.  INSIDER TRADING REGULATIONS
 
 Based on the requirements under SEBI (Prohibition of Insider Trading)
 Regulations, 2015, the ''Insider Trading Code'' to regulate, monitor and
 report trading by insiders and the ''Code of Practices and Procedures
 for fair disclosure of Unpublished Price Sensitive Information'' are in
 force.
 
 30.  AWARDS AND RECOGNITIONS
 
 Your Company relentlessly pursues excellence and is delighted to
 receive phenomenal share of recognitions and awards this year, not only
 from the media, but also from analysts, governing bodies, academic
 institutions, partners and even customers. Some of the key accolades
 received during the year include:
 
 - Won the coveted Indo-German Chamber of Commerce Award for
 Outstanding Contribution towards the Indo-German Economic Relations,
 2015. The award was given for creating a strong local presence in
 Germany while strengthening employment creation & competitiveness in
 the region.
 
 - ITSMA''s (IT Services Marketing Association) Diamond award for
 Delivering an Omnichannel Customer Experience for corporate
 positioning - ''Relationship Beyond the Contract'', which has been
 recognized as industry''s best-in-class, driving business with thought
 leadership and another Diamond Award for Marketing Excellence.
 
 - Recognized at the Asian Customer Engagement Forum (ACEF) Awards, for
 Creativity in Digital Marketing exhibited in its campaign, showcasing
 the impact of viral videos for building employer brand affinity amongst
 existing and prospective employees.
 
 - Recognition as the fastest growing brand for the second consecutive
 year by the Interbrand, world''s leading brand consultancy.
 
 - Recognized as one of the most admired corporate brands by The
 Economic Times (ET), in its study on the Best Corporate Brands 2015.
 
 - Recognition as a Top Employer in the UK for ten consecutive years for
 its exceptional employee offerings and outstanding HR practices.
 
 - Continuing its focus on best-in-class people practices, HCL has been
 awarded the Special TM Commendation Prize for Practice of
 Ideapreneurship at Asian Human Capital Awards 2015.
 
 - 2015 Governor''s NCWorks Award of Distinction as an Outstanding
 Employer in the state of North Carolina.
 
 - Selected as the winner of the CA Technologies Partner of the Year
 Awards 2015 in the category of innovation and sales teaming for its
 ability to drive global innovation and sales teaming in both
 infrastructure management and service management.
 
 - Positioned as a Leader in the IDC MarketScape Worldwide Life Science
 Manufacturing and Supply Chain ITO Vendor Assessment 2015.
 
 - Everest Group PEAK Matrix ''Service Provider of the Year Award 2016''
 in two categories - ''Overall IT Services'' and ''Banking, Financial
 Services and Insurance (BFSI) IT''. In both these categories, the
 Company has been recognized as ''Star Performer of the Year''.
 
 - Positioned among Leaders in IDC MarketScape for Worldwide Application
 Modernization Services for Oracle Upgrades,2016.
 
 - Positioned in the Winner''s Circle for its software product
 engineering services capabilities by the leading analyst firm HfS in
 its report HfS Blueprint Report: Software Product Engineering Services
 Outsourcing 2015.
 
 - Recognized as a Leader in IDC MarketScape for Worldwide Application
 Modernization Services for Digital Transformation 2015 Vendor
 Assessment, Dec 2015.
 
 - Recognized as an Outstanding Contributor to the VLSI/ Embedded Design
 Industry in the Corporate Category, by Mentor Graphics Corporation and
 Silicon India, at the Leadership Awards 2015.
 
 - Positioned in the leadership zone in Zinnov''s Media & Entertainment
 Global Service Providers Rating for Gaming, Entertainment, Marketing &
 Advertising, Publishing and Information Services, 2016.
 
 - Rated as a Leader in The Forrester Wave™: Global Workplace
 Services, North American Workplace Services, EMEA Workplace Services,
 Q4 2015 by Wolfgang Benkel and William Martorelli December 17, 2015.
 
 - Positioned as a Leader in IDC MarketScape for Worldwide Microsoft
 Enterprise Applications Implementation Services, 2015.
 
 31.  SUSTAINABILITY
 
 Your Company believes in a better tomorrow and based on this strong
 belief has embarked on a Sustainability 2020 programme.  The Company''s
 continuous focus on improving all aspects of sustainability
 demonstrates its commitment to a sustainable tomorrow without
 compromising on the well-being of its employees today. To do this, the
 Company partners with multiple stakeholders to form an inclusive
 working group to create policies, processes and other organizational
 measures. Today, the Sustainability Department runs a multi-layered
 corporate program to drive the sustainability vision.
 
 The ongoing success of the programme depends on a consistent and
 sustainable vision, ease and flexibility of implementation and most
 importantly Employee Engagement. At HCL, sustainability actions are a
 part of everyday operations. It believes that responsible investments
 in sustainability will generate long term value for all the
 stakeholders by improving competitiveness and reducing risk.
 
 Sustainability can be created when we are able to integrate broader
 societal concerns into business strategy and performance as part of the
 Company''s business model. This common sense of ownership can be
 realized by incorporating the interests of all those with whom the
 Company has mutually dependent relationships.
 
 The initiatives taken by the Company on sustainability are given in
 detail in the sustainability report for the year 2015-16 which is
 hosted on the website of the Company.
 
 32.  ORGANIZATION EFFECTIVENESS
 
 The Company has further consolidated its distinctive practices during
 the financial year under review around the theme of design U2.0.
 Design U2.0 is a journey of self-discovering and development by which
 individuals in an organization take responsibility for optimizing their
 future readiness and will deliver on the four capability areas of
 Listen, Collaborate, Ideate and Create for the individual and
 organization both. Your Company is anchoring its employee experience
 proposition around Design U2.0.
 
 Career & Talent Management
 
 The Social HR framework put in place by the Company saw further
 recognition for Social Career Management by Brandon Hall (best advance
 in social talent management technology and another for best advance in
 leadership development) amongst many similar recognitions.
 
 The social career and talent management platform allows employees to
 recast their roles as CEO of their own careers. Employees access the
 Company''s career architecture, understand what it takes to be selected
 for each opportunity and go through a job based integrated curriculum
 to advance their career aspirations on a social career management
 platform. In this social career management platform, employees can
 refer internal opportunities to other employees and can anonymously
 vote their career advice to a fellow employee.
 
 Engagement & Culture
 
 The Company continues to be the place where employees can listen,
 ideate, collaborate and create. For the 1 0th year in a row, the
 Company was awarded the best employer in UK by the Top Employers
 Institute for its employee engagement and Ideapreneurship culture. The
 Company has also won the Asian Human Capital award for the practice of
 Ideapreneurship by the Human Capital Leadership Institute in Singapore.
 
 The culture of Ideapreneurship is how the Company provides its
 employees or ideapreneurs with the license to ideate, the tools to
 ideate and the recognition for ideating. This helps us as a firm to
 deliver a relationship beyond the contract with our customers.
 
 33.  CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
 EARNINGS AND OUTGO
 
 Disclosures of particulars as required under Section 134(3)(m) of the
 Act read with the Companies (Accounts) Rules, 2014 to the extent
 applicable to your Company, are set out in Annexure 5 to this Report.
 
 34.  DIRECTORS'' RESPONSIBILITY STATEMENT
 
 A statement of responsibility of the Directors relating to compliance
 with the financial accounting and reporting requirements in respect of
 the financial statements, as specified under clause (c) of sub- section
 3 of Section 134 of the Act, is annexed as Annexure 6 to this Report.
 
 35.  STOCK OPTIONS PLANS
 
 1999 Stock Option Plan / 2000 Stock Option Plan / 2004 Stock Option
 Plan
 
 The details of these plans have been annexed as Annexure 7 to this
 Report.
 
 36.  MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION
 OF THE COMPANY
 
 Except, as disclosed elsewhere in the Report, there have been no
 material changes and commitments, which can affect the financial
 position of the Company between the end of the financial year and the
 date of this Report.
 
 37.  PARTICULARS OF EMPLOYEES
 
 The information required pursuant to Section 197(12) of the Act read
 with Rule 5(1) of The Companies (Appointment and Remuneration of
 Managerial Personnel) Rules, 2014 are given below:
 
 a.  The ratio of the remuneration of each Director to the median
 remuneration of the employees of the Company for the financial year:
 
 Sl.
 No. Name of Director                             Ratio to median
                                                  remuneration of
                                                        employees
   
     Executive Director
 
 1.  Mr. Shiv Nadar*                                       214.47
 
     Non-Executive Directors
 
 2   Mr. Amal Ganguli                                       10.11
 
 3   Mr. Keki Mistry                                         8.24
 
 4.  Mr. Ramanathan Srinivasan                              14.16
 
 5.  Ms. Robin Ann Abrams                                   14.57
 
 6.  Ms. Roshni Nadar Malhotra                               7.59
 
 7.  Mr. Subramanian Madhavan                                9.43
 
 8.  Mr. Sudhindar Krishan Khanna                            7.69
 
 9.  Dr. Sosale Shankara Sastry                             11.85
 
 10.  Mr. Thomas Sieber**                                       -
 
 The remuneration of Non-executive Directors also includes sitting fees
 paid during the year
 
 *The ratio has been calculated after taking into account the
 remuneration drawn from the Company as well the subsidiaries.
 
 **He was appointed as Director during the year. Hence the said
 information is incomparable and not provided.
 
 b.  The percentage increase in remuneration of each Director, Chief
 Executive Officer, Chief Financial Officer, Company Secretary in the
 financial year:
 
 The current financial year of the Company is for a nine months period
 from July 1, 2015 to March 31, 2016. The figures for the current
 financial year are therefore not comparable with those of the previous
 year.
 
 c.  The percentage increase in the median remuneration of employees in
 the financial year: 6.8%
 
 d.  The number of permanent employees on the rolls of Company: There
 were 74,887 permanent employees on the rolls of the Company. In
 addition the Company has 28,504 number of employees on the rolls of its
 subsidiaries.
 
 e.  The explanation on the relationship between average increase in
 remuneration and Company performance:
 
 On an average, employees received an annual increase of 8.09% in India.
 The individual increments varied from 2.4% to 21.92%, based on
 individual performance.
 
 Employees outside India received average wage increase of 2.5%. The
 increase in remuneration of employees in India and outside India is in
 line with the market trends in the respective countries. Increase in
 remuneration of employees reflects the individual''s and Company''s
 performance. The Annual Performance Bonus pay out is also linked to
 organization performance, apart from an individual''s performance.
 
 f.  Comparison of the remuneration of the Key Managerial Personnel
 against the performance of the Company:
 
                                                        (Rs. in crores) 
 
 Particulars                                           On the basis of
 
                                            Standalone    Consolidated
 
 Aggregate remuneration of Key                   51.26           55.98
 Managerial Personnel (KMP) in FY16
 
 Revenue (FY16)                              14,402.11       31,676.24
 
 Remuneration of KMP as percentage                0.36            0.18
 of Revenue
 
 Profit before Tax (FY16)                     5,767.61        6,969.14
 
 Remuneration of KMP as percentage of             0.89            0.80
 Profit before Tax
 
 g.  Variations in the market capitalisation of the Company, price
 earnings ratio as at the closing date of the current financial year and
 previous financial year:
 
 Particulars                     31st March   30th June    % change
                                       2016        2015
 
 Market Capitalisation (Rs. 
 crore)                             114,819     129,312      -11.2%
 
 Price Earnings Ratio                30.54*       35.52      -14.0%
 
 * EPS for FY15-16, has been annualized by multiplying EPS of 9 months
 ending March, 2016 with 4/3.
 
 h.  Percentage increase over decrease in the market quotations of the
 shares of the Company in comparison to the rate at which the Company
 came out with the last public offer:
 
 Particulars         31st March  24th December  24th December  % change*
                           2016     1999 (IPO)    1999 (IPO)*
 
 Market Price 
 (NSE)                   814.10           580            72.5     1022.9
 
 Market Price 
 (BSE)                   814.15           580            72.5     1023.0
 
 * Adjusted for Stock Split (face value of Rs. 4 per share sub-divided
 into 2 shares of face value of Rs. 2 each in the year 2000) and
 adjusted for Bonus issues in the year 2007 (1:1) and 2015 (1:1).
 
 i.  Average percentile increase already made in the salaries of
 employees other than the managerial personnel in the last financial
 year and its comparison with the percentile increase in the managerial
 remuneration and justification thereof and point out if there are any
 exceptional circumstances for increase in the managerial remuneration:
 
 The average annual increase was 6%. There is no increase in the
 managerial remuneration during the year.
 
 j. Comparison of each remuneration of the Key Managerial Personnel
 against the performance of the Company:
 
 i) On the basis of Standalone accounts
 
                                                         (Rs. in crores)
 
              Mr. Shiv Nadar,  Mr. Anant 
                                  Gupta,    Mr. Anil
                                             Chanana   Mr.Manish Anand,
                  Chairman &       Chief
                               Executive       Chief 
                                           Financial            Company 
                       Chief  
                    Strategy     Officer     Officer          Secretary
                     Officer
 
 Remuneration 
 in                     9.07       38.19        3.46               0.54
 FY16
 
 Revenue                              14,402.11
 
 Remuneration 
 as                    0.063       0.265       0.024              0.004
 % of Revenue
 
 Profit before 
 Tax                                   5,767.61
 
 Remuneration 
 as                    0.157       0.662       0.060              0.009
 % of Profit 
 before
 Tax
 
 ii) On the basis of Consolidated accounts
 
                                                         (Rs. in crores)
 
                     Mr. Shiv 
                       Nadar,    Mr. Anant
                                    Gupta,    Mr. Anil 
                                               Chanana  Mr.Manish Anand,
                     Chairman
                            &        Chief
                                 Executive       Chief
                                             Financial          Company
                        Chief
                     Strategy      Officer     Officer        Secretary
                      Officer
 
 Remuneration in        12.60        38.19        4.66             0.54
 FY16
 
 Revenue                                31,676.24
 
 Remuneration as        0.040        0.121       0.015            0.002
 % of Revenue
 
 Profit before Tax                       6,969.14
 
 Remuneration as        0.181        0.548       0.067            0.008
 % of Profit before
 Tax
 
 k. The key parameters for any variable component of remuneration
 availed by the Directors:
 
 The shareholders of the Company in the Annual General Meeting held on
 December 4, 2014 had granted their approval for payment of commission
 not exceeding one percent per annum of the net profits of the Company
 calculated in accordance with the provisions of the Act, to all the
 Non-executive Directors of the Company for a period of 5 years
 beginning from July 1, 2014.
 
 The said commission is decided each year by the board of Directors and
 distributed amongst the Non-executive Directors based on their
 attendance and contribution at the Board and certain Committee
 meetings, as well as the time spent on operational matters other than
 at meetings.
 
 l.  The ratio of the remuneration of the highest paid Director to that
 of the employees who are not Directors but receive remuneration in
 excess of the highest paid Director during the year:
 
 The ratio of remuneration of Mr. Shiv Nadar, the highest paid Director
 to that of Mr. Anant Gupta, President & Chief Executive Officer, the
 highest paid employee is as under:
 
 a) On Consolidated basis: 0.33:1
 
 b) On Standalone basis: 0.24:1
 
 m. Affirmation that the remuneration is as per the remuneration policy
 of the Company:
 
 The Company affirms that the remuneration is as per the remuneration
 policy of the Company.
 
 38.  STATEMENT OF EMPLOYEES PURSUANT TO RULE 5(2) THE COMPANIES
 (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014
 
 A statement containing the names of the employees employed throughout
 the financial year and in receipt of remuneration of Rs. 60 lacs or
 more and employees employed for part of the year and in receipt of Rs.
 5 lac or more per month, pursuant to Rule 5(2) of the Companies
 (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is
 provided as Annexure 8 to this Report.
 
 39.  VIGIL MECHANISM / WHISTLE BLOWER POLICY
 
 The Company has formulated and published a Whistle Blower Policy to
 provide Vigil Mechanism for employees including Directors of the
 Company to report genuine concerns and to ensure strict compliance with
 ethical and legal standards across the Company. The provisions of this
 Policy are in line with the provisions of the Section 177(9) of the Act
 and SEBI (Listing Obligation & Disclosure Requirements) Regulations,
 2015, and are available on the website of the Company at
 http://www.hcltech.com/about-us/corporate-governance/
 governance-policies. The details of Whistle Blower Policy forms part of
 the Corporate Governance Report annexed with this Report.
 
 40.  DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
 (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
 
 The Company has in place a Prevention and Redressal of Sexual
 Harassment at Work Place Policy in line with the requirements of Sexual
 Harassment of Women at Workplace (Prevention, Prohibition and
 Redressal) Act, 2013. The Company has constituted a committee for the
 redressal of all sexual harassment complaints. These matters are also
 being reported to the Audit Committee. The details of the Policy and
 the complaints are given under Corporate Governance Report and the
 Sustainability Report respectively.
 
 41.  ACKNOWLEDGEMENTS
 
 The Board wishes to place on record its appreciation of the significant
 contributions made by the employees of the Company and its subsidiaries
 during the year under review. The Company has achieved impressive
 growth through the competence, hard work, solidarity, cooperation and
 support of employees at all levels. Your Directors thank the customers,
 clients, vendors and other business associates for their continued
 support in the Company''s growth.  The Directors also wish to thank the
 Government Authorities, Financial Institutions and Shareholders for
 their cooperation and assistance extended to the Company.
 
                        For and on behalf of the Board of Directors
 
 Place: Noida (U.P.), India                              SHIV NADAR
 
 Date : April 28, 2016          Chairman and Chief Strategy Officer
Source : Dion Global Solutions Limited
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