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Directors Report of Future Consumer Ltd.

Mar 31, 2016

Dear Shareholders,

The Directors have pleasure in presenting the 20th Annual Report and the Audited Accounts of Future Consumer Enterprise Limited ["Company"], for the year ended 31st March, 2016.

FINANCIAL HIGHLIGHTS

The summarized financial performance (Standalone and Consolidated) of the Company for 2015-16 and 2014-15 is given below:

(Rs. in Lakhs)

Standalone Consolidated

2015-16 2014-15 2015-16 2014-15

Total Income 1,37,024.80 1,11,912.33 1,78,050.59 1,34,741.53

Profit/(Loss) before Tax & Exceptional Items (6,355.01) (6,860.91) (11,837.04) (10,877.61)

Less : Exceptional Items - 2,514.00 470.14 -

Profit/(Loss) before Tax (6,355.01) (9,374.91) (12,307.18) (10,877.61)

Profit/(Loss) After Tax (6,355.01) (9,374.91) (12,313.48) (10,937.03)

Profit/(Loss) After Share of Associates & NA NA (11,278.38) (10,276.42) Minority Interest

BUSINESS OPERATIONS

This fiscal has been an interesting year for Future Consumer Enterprise Limited with the Company continuing to report disproportionate topline growth and gross margins. This year witnessed the expansion of our brand portfolio into new age value add categories, our food park continued to act like a kitchen enabling the roll out of these products and the growth of our distribution channel across modern trade & general trade outlets. Your Company''s product portfolio includes product categories, such as basic foods, ready to eat meals, snacks, frozen and processed food products, beverages, personal care and home care under its own portfolio of brands.

Your Company continues to focus on developing its portfolio of brands and has entered into joint venture arrangements with leading market players. During the year under review, your Company has entered into joint venture with Mibelle AG, a Swiss based entity for marketing and distribution of imported personal care products under the brand name "Swiss Tempelle" in India. Further, your Company has also commenced its operations for marketing and distribution of oats and oats based cereal products in India through its subsidiary company at Sri Lanka. With focus on exploring cross border opportunities, and developing new markets in food/FMCG category, your Company has also formed an entity at Jebel Ali, UAE. This entity is targeted to engage into sourcing and distribution of food and FMCG products from and to various countries.

During the fiscal 2015-16, your Company has acquired the business of manufacturing and distribution of skin care, baby care, home care wet wipes and hand sanitizer wipes from Grasim Industries Limited which are marketed under the brand names "Kara", "Puretta", "Handys" and "Prim". Your Company has expanded this business by launching new category of wipes under the aforesaid brands. The distribution network of Kara will be leveraged for expanding the distribution of its personal care brands.

During the year under review, your Company has transformed into a pure play food & FMCG Company. All operations pertaining to convenience stores of the Company and / or its subsidiaries under various format brands such as "KB''s Fair Price", "KB''s Conveniently Yours", "Big Apple", "Aadhaar" and "Nilgiris" are now operated by franchisee(s) appointed by the Company. Your Company now pre-dominantly undertakes the business activities of sourcing, processing, manufacturing, branding, marketing and distribution of fast moving consumer goods ("FMCG"), basic food and processed food products under its own brands.

During the year under review, your Company also announced fund raise from Black River Food 2 Pte. Limited (US$45 million) and promoter group entity (Rs.67 Crore) through equity linked instruments. The objective of this fund raise is to enable repayment of debt and also fund your Company''s current growth plans.

Your Company has recorded total income of Rs.1,370.25 Crore and EBIDTA Profit of Rs.21.42 Crore in the current financial year as against total income of Rs.1,119.12 Crore and EBIDTA loss of Rs.5.99 Crore in the previous financial year.

In view of the loss incurred during the financial year 2015-16, no appropriation is proposed to be made towards Reserves.

Save and except those mentioned in this Report, there were no material changes and commitments affecting the financial position of the Company between the end of financial year and the date of this Report.

FUTURE OUTLOOK

India is well poised to benefit from macroeconomic tailwinds, as it has entered the new fiscal year. Under control inflation and soft crude price outlook has led to higher disposable income in the hands of consumer, providing a boost to the domestic consumption. Above normal monsoon forecast, after two years of poor rainfall, is expected to keep the inflation in check and take the overall demand northwards. The 7th Pay Commission recommendations of proposed 23.55% wage hike to Central Government employees are scheduled to take effect from January 2016. The implementation is expected to take place in the current fiscal year and will mean significantly higher spending power in the hands of 4.7 million employees and 5.2 million pensioners.

India continues to benefit from the growing domestic demand from a young population, whose consumption is driving the expansion of the middle class. By 2025, India is expected to become the fifth-largest consuming class Country. An emerging rural consumer base is also contributing to this demand. The overall Indian FMCG market is estimated to be USD 185 billion, of which the branded portion constitutes merely USD 65 billion. This branded portion of the market is expected to almost double by 2020 and touch USD 240 billion by 2025. With a distribution network led by modern retail, your Company is best placed to expect profit from these trends and create value for consumers, for business partners and for all stakeholders.

INITIAL PUBLIC OFFER ("IPO")

In terms of the provisions of Schedule V of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") details about unclaimed shares in suspense account as on 31st March, 2016 is as under:

Description No. of No. of Shareholders Shares

Aggregate number of 3 21,600 shareholders and outstanding shares in the suspense account as on 1st April, 2015

Aggregate number of Nil NA shareholders who approached the Company for transfer from suspense account upto 31st March, 2016

Number of shareholders to Nil NA whom shares were transferred from suspense account upto 31st March, 2016

Aggregate number of 3 21,600 shareholders and outstanding shares in the suspense account as on 31st March, 2016

The Company has opened separate suspense accounts with National Securities Depository Limited and Central Depository Services (India) Limited and has credited the said unclaimed shares to the suspense accounts.

The voting rights in respect of shares maintained under the suspense account shall remain frozen till the rightful owner makes any claim over such shares.

Pursuant to the Composite Scheme of Arrangement and Amalgamation, 1 equity share of Future Lifestyle Fashions Limited ("FLFL") has been alloted to shareholders of Future Consumer Enterprise Limited for every 31 shares held by them. Accordingly, 696 shares of FLFL, arising out of 21,600 unclaimed shares have also been credited to the said suspense accounts.

DIVIDEND

To conserve the funds for future business growth, your Directors have not recommended any dividend on equity shares in respect of the financial year 2015-16.

INCREASE IN SHARE CAPITAL

During the year under review, your Company has issued and allotted 2,98,000 equity shares of the Company to eligible employees on exercise of options granted under FVIL Employee Stock Option Scheme - 2011. Consequently, the issued, subscribed and paid-up capital of the Company increased from 1,65,71,44,038 equity shares of Rs.6/- each to 1,65,74,42,038 equity shares of Rs.6/- each.

After the financial year ended 31st March, 2016, the Company has issued 100 equity shares to Black River Food 2 Pte. Limited, in terms of the preferential allotment made by the Company. Consequently, the issued, subscribed and paid-up capital of the Company increased from 1,65,74,42,038 equity shares of Rs.6/- each to 1,65,74,42,138 equity shares of Rs.6/- each.

ISSUE OF CONVERTIBLE SECURITIES

During the year under review, your Company has issued and allotted 6,700 warrants having face value of Rs.1,00,000/- each to Srishti Mall Management Company Private Limited ("Srishti"), a promoter group entity on preferential allotment basis upon receipt of Rs.1,675 lakhs from Srishti towards 25% of the total consideration price for the warrants. The warrants may be exercised by Srishti at any time before expiry of 18 months from the date of allotment of warrants. Upon such exercise and on payment of balance 75% of the total consideration amount by Srishti, the warrants shall be converted into equity shares at a conversion price of '' 22.73 per equity share.

After the financial year ended 31st March, 2016, your Company has issued and allotted 29,985 Compulsorily Convertible Debentures ("CCDs") having face value of Rs.1,00,000/- each to Black River Food 2 Pte. Limited ("Black River") on preferential allotment basis. The CCDs carry a coupon of 8.5% per annum compounded on a quarterly basis. The CCDs shall automatically and compulsorily be converted into equity shares at a conversion price of Rs.22.73 per equity share on the earlier of occurrence of following events - a) Black River electing to convert the CCDs into equity shares and b) the date that is 18 months from the date of issue of CCDs. In the event of unpaid coupons, if any, Black River shall be entitled to such number of equity shares, equivalent to the amount of coupons remaining unpaid at a conversion price of Rs.22.73 for each equity share

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

As at 31st March, 2016, your Company had following Subsidiaries /Joint Ventures /Associate Companies:

Sr. Name of the company Category No

1. Aadhaar Wholesale Trading and Subsidiary Distribution Limited

2. Future Food and Products Subsidiary Limited

3. Future Consumer Products Subsidiary Limited

4. Star and Sitara Wellness Limited Subsidiary

5. Amar Chitra Katha Private Subsidiary Limited ("ACKPL")

6. FCEL Food Processors Limited Subsidiary of ACKPL (formerly known as ACK Edutainment Limited!

7. ACK Media Direct Limited Subsidiary of ACKPL

8. IBH Books & Magazines Subsidiary of ACKPL Distributors Limited

9. Ideas Box Entertainment Limited Subsidiary of ACKPL

10. Future Food Processing Private Subsidiary Limited (formerly known as Future Personal Care and Hygiene Products Private Limited)

11. Express Retail Services Private Subsidiary Limited

12. The Nilgiri Dairy Farm Private Subsidiary Limited ("NDFPL")

13. Appu Nutritions Private Limited Subsidiary of NDFPL

14. Nilgiri''s Mechanised Bakery Subsidiary of NDFPL Private Limited

15. Nilgiris Franchise Private Limited Subsidiary of NDFPL

16. Integrated Food Park Private Subsidiary Limited

17. Sublime Foods Private Limited Subsidiary

18. Aussee Oats Milling (Private) Subsidiary Limited

19. MNS Foods Private Limited Subsidiary (With effect from 4th August, 2015)

20. Bloom Fruit and Vegetables Subsidiary Private Limited (With effect from 15th January, 2016)

21. Aussee Oats India Private Subsidiary Limited (With effect from 19th February, 2016)

22. FCEL Overseas FZE Subsidiary (By virtue of control through Board Composition)

23. Sarjena Foods Private Limited Associate

24. Mibelle Future Consumer Joint Venture Products AG (With effect from 9th October, 2015)

During the year under review,

a) Karadi Tales Company Private Limited has ceased to be a subsidiary of ACKPL with effect from 16th July, 2015.

b) Karadi Path Company Private Limited became an associate of ACKPL with effect from 17th July, 2015 and ceased to be an associate of ACKPL with effect from 3rd October, 2015.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of financial statements of subsidiaries, associates and joint venture companies in Form AOC 1 is attached separately to this Annual Report.

The performance and financial position of each of the subsidiaries, associates and joint venture companies is provided under Management Discussion and Analysis Report which is presented separately and forms part of this Report.

In accordance to the provisions of Section 136(1) of the Companies Act, 201 3, the Annual Report of the Company, containing therein standalone and the consolidated financial statements of the Company and the audited financial statements of each of the subsidiary companies have been placed on the website of the Company - www.futureconsumer.in.

The audited financial statements in respect of each subsidiary company shall also be kept open for inspection at the Registered Office of the Company during working hours for a period of 21 days before the date of ensuing Annual General Meeting. The aforesaid documents relating to subsidiary companies can be made available to any Member interested in obtaining the same upon a request in that regards made to the Company.

The policy for determining material subsidiaries as approved by the Board of Directors of the Company is made available on the website of the Company - http://futureconsumer.in/ policies-and-code.html

DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the year under review, Mr. Adhiraj Harish has been appointed as an Additional Director of the Company with effect from 1st September, 2015. After the financial year ended 31st March, 2016, Mr. Deepak Malik, a nominee of Black River Food 2 Pte. Limited, has been appointed as an Additional Director of the Company with effect from 26th April, 2016.

In accordance with the provisions of Section 161 of the Companies Act, 2013, Mr. Adhiraj Harish and Mr. Deepak Malik shall hold office only upto the date of forthcoming Annual General Meeting.

Mr. Frederic de Mevius has ceased to be an independent director of the Company, in terms of the disclosure given by him to the Company. Accordingly, the Board of Directors had at their meeting held on 26th April,2016 appointed Mr. Frederic de Mevius as an Additional Director categorised as Non- Executive and Non- Independent Director of the Company.

In terms of provisions of Section 161 of the Companies Act,2016, Mr. Frederic de Mevius holds office only upto the date of forthcoming Annual General Meeting.

Pursuant to the provisions of the Section 160 of the Companies Act, 2013, the Company has received individual notice(s) from a Member proposing the candidature of Mr. Adhiraj Harish, Mr. Deepak Malik and Mr. Frederic de Mevius for the office of Director at the forthcoming Annual General Meeting.

In terms of the provisions of the Companies Act, 2013, Mr. Krishan Kant Rathi retires from the Board of Directors of the Company by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment.

The Notice convening forthcoming Annual General Meeting includes the proposal for appointment / re-appointment of aforesaid Directors. A brief resume of the Directors seeking appointment / re-appointment at the forthcoming Annual General Meeting and other details as required to be disclosed in terms of Regulation 36(3) of the SEBI Listing Regulations, forms part of the said Notice. None of the Directors are disqualified for appointment / re-appointment under Section 164 of the Companies Act, 2013. None of the Directors being appointed / re-appointed are individually related to any other Directors.

During the year under review, Mr. Jagdish Shenoy, Director has resigned from the Board of Directors of the Company with effect from 1st September, 2015. The Board of Directors wish to place on record their appreciation for contributions made by Mr. Jagdish Shenoy during his tenure as a member of the Board of Directors of the Company.

The Company has received individual declarations from following Independent Director(s) of the Company stating that they meet the criteria of independence as provided under sub-section (6) of Section 149 of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI Listing Regulations:

a) Mr. G N Bajpai

b) Ms. Vibha Rishi

c) Mr. Adhiraj Harish

AUDITORS AND AUDITORS'' REPORT

M/s. Deloitte Haskins & Sells, Chartered Accountants, have been appointed as the Statutory Auditors of the Company for a period of three years at the 18th Annual General Meeting held on 26th August, 2014. In terms of the provisions of Companies Act, 2013 their appointment will however need to be ratified by the Shareholders at the forthcoming Annual General Meeting. Notice convening the forthcoming Annual General Meeting includes a proposal for ratification of appointment of Statutory Auditors by the Shareholders of the Company.

The notes on financial statements referred to in the Auditors Report are self-explanatory and do not call for any further comments and explanations. The Auditors'' Report does not contain any qualification, reservation or adverse remark.

SECRETARIAL AUDITOR AND SECRETARIAL AUDIT REPORT

The Company has appointed M/s. Sanjay Dholakia & Associates, Company Secretaries to conduct Secretarial Audit of the Company for the financial year 2015-16 in terms of provisions of Section 204 of the Companies Act, 2013. The Secretarial Audit Report is annexed to this Report as Annexure I. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

PARTICULARS OF LOANS GRANTED, GUARANTEE PROVIDED AND INVESTMENTS MADE PURSUANT TO THE PROVISIONS OF SECTION 186 OF THE COMPANIES ACT, 2013

Details of loans granted, guarantees provided and investments made by the Company under the provisions of Section 186 of the Companies Act, 2013, are provided in standalone financial statement under Note 49 under Notes forming part of standalone financial statement.

RELATED PARTY TRANSACTIONS

All transactions entered into with related parties during the financial year under review were in the ordinary course of business and on arm''s length basis.

The particulars of contracts or arrangements with aforesaid related parties, in prescribed format is annexed to this Report as Annexure II.

The policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is available on the website of the Company - http://futureconsumer.in/policies-and-code.html RBI REGULATIONS

With shift in main business activities and consequent to application made by the Company for de-registration as a Non-Banking Financial Company, the Certificate of Registration granted by Reserve Bank of India has been cancelled.

PUBLIC DEPOSITS

Your Company has not been accepting any deposits from the public and hence there are no unpaid / unclaimed deposits nor is there any default in repayment thereof.

BOARD MEETINGS

The Board of Directors met 6 (six) times during the financial year 2015-16. The details of board meetings and the attendance of the Directors are provided in the Corporate Governance Report which forms part of this Annual Report.

COMMITTEES OF THE BOARD OF DIRECTORS

As on 31st March, 2016, the Corporate Social Responsibility Committee comprises of following members:

a) Ms. Ashni Biyani - Chairperson

b) Mr. Kishore Biyani - Member

c) Ms. Vibha Rishi - Member

As on 31st March, 2016, the Audit Committee comprises of following members:

a) Mr. G N Bajpai - Chairman

b) Mr. K K Rathi - Member

c) Ms. Vibha Rishi - Member

During the year under review, all recommendations made by the Audit Committee were accepted by the Board. There were no instances where the Board has not accepted any recommendation of the Audit Committee.

Details of Committees of the Board of Directors along with their terms of reference, composition and meetings held during the year under review, are provided separately in the Corporate Governance Report, which forms part of this Annual Report.

PERFORMANCE EVALUATION OF BOARD

In terms of the requirements prescribed under the Companies Act, 201 3 and SEBI Listing Regulations, the Board has carried out the process for evaluation of performance of the entire Board of Directors and that of its Committees and individual Directors.

The performance evaluation exercise for the entire Board of Directors and its Committees was conducted through structured questionnaire having qualitative parameters inter-alia comprising of key areas such as competencies and experience, quality of agenda notes circulated for board and committee meetings, composition of members, timelines for circulation of minutes, quality of recording board discussions, deliverance of allocated role and responsibilities, information sharing and communication, corporate governance process and disclosures.

Further, a separate exercise was also carried out to evaluate the performance of each individual Director for which a questionnaire was circulated to other Directors inter-alia comprising of key areas such as attendance at Board Meetings and Committee Meetings, preparedness for the Board and Committee Meeting(s), contribution in the Board room using expertise, knowledge, experience and wisdom, independence of views and judgement, ownership of value building.

The responses received to the questionnaires on evaluation of the Board and its Committees and that of the individual Directors were shared with the Board, Chairman of respective Committees and with the individual Directors. The Chairman of respective Committees also shared the results of evaluation with the respective Committee Members. Based on the outcome of the evaluation, the Board and Committees have agreed on an action for possible continuous improvisation to ensure better effectiveness and functioning of the Board and Committees.

EXTRACT OF ANNUAL RETURN

In terms of provisions of Section 92(3) of the Companies Act, 2013, an extract of Annual Return in prescribed format is annexed to this Report as Annexure III.

CORPORATE GOVERNANCE

A report on Corporate Governance together with Auditors'' Certificate as required under Regulation 34 of SEBI Listing Regulations forms part of this Annual Report.

MANAGEMENT DISCUSSION & ANALYSIS REPORT

The Management Discussion & Analysis Report as required under Regulation 34 of SEBI Listing Regulations is presented separately and forms part of this Report.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the provisions of Companies Act, 2013 and Accounting Standards prescribed by the Institute of Chartered Accountants of India in this regard, the audited consolidated financial statements are provided in this Annual Report.

VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The Company has established a vigil mechanism to provide a framework for promoting responsible and secure whistle blowing and to provide a channel to the employee(s), Directors and other stakeholders to report to the management, concerns about unethical behavior, actual or suspected fraud or violation of the code of conduct or policy/ies of the Company, as adopted / framed from time to time. The details of said vigil mechanism is given in Corporate Governance Report, which forms part of this Annual Report.

PARTICULARS OF EMPLOYEE STOCK OPTION PLAN

The Company has formulated following employee stock options schemes:

a. FVIL Employees Stock Option Plan-2011 ("FVIL ESOP- 2011")

b. Future Consumer Enterprise Limited Employee Stock Option Plan - 2014 ("FCEL ESOP-2014")

The aforesaid Employee Stock Option Plans are in compliance with SEBI (Share Based Employee Benefits) Regulations, 2014, as amended from time to time ("SEBI Employee Benefits Regulations") and there has been no material changes to these Plans during the financial year under review.

The details of options granted and exercised under FVIL ES0P-2011 and FCEL ES0P-2014 and other disclosures as required under SEBI Employee Benefits Regulations, are available on the website of the Company - http:// futureconsumer.in/statutory-documents.html and are also provided in Annexure IV, which is annexed to this Report.

PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, EXPENDITURE ON RESEARCH AND DEVELOPMENT, FOREIGN ExCHANGE EARNINGS AND OUTGO ETC

Considering the nature of activities in which the Company operates, energy consumption is in accordance to the normal business practices and does not require any specific installations. In its regular course of business, the Company is always vigilant to conserve the resources and continuously implements measures required to save energy.

The business activities of the Company is not specific to any technology requirements. In the course of its operations, processes are formed and implemented to achieve operational efficiencies which provide maintaining product quality and cost control.

In respect of the manufacturing units of the Company, the brief particulars in respect of various steps and initiatives taken regarding conservation of energy and technology absorption are as under:

a) Conservation of Energy

At the manufacturing locations of the Company, LED lights have been installed in place of CFL lights. Roof Ventilators have been installed at Tumkur location which conserves energy and control carbon emissions. Roof covers used there are acrylic sheets which results into varying levels of heat resistance, light transmissions, impact strength, and flow rates. At the time of installation amongst other aspects emphasis is given on equipments that are power efficient.

b) Technology Absorption

In the manufacturing process, Form Fill Seal Machines are installed for packaging which provides greater speed and versatility and are cost effective.

The aforesaid initiatives has resulted in economies in costs.

The details in respect of Foreign Exchange earnings/ outgo during the year under review, is provided in Note No. 34 under Notes forming part of standalone financial statements.

RISK MANAGEMENT POLICY AND INTERNAL ADEQUACY

Your Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. Your Company''s internal control systems are commensurate with the nature of its business and the size and complexity of its operations. These are routinely tested by Statutory as well as Internal Auditors. Significant audit observations and follow up actions thereon, if any, are reported to the Audit Committee.

CORPORATE SOCIAL RESPONSIBILITY

The Company has constituted a Corporate Social Responsibility Committee ("CSR Committee") in accordance with the provisions of Section 1 35 of the Companies Act, 2013. The Board of Directors of the Company has, based on the recommendations made by the CSR Committee formulated and approved Corporate Social Responsibility Policy for the Company.

The disclosures as per Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is made in prescribed form which is annexed to this Report as Annexure V.

NOMINATION AND REMUNERATION POLICY

In terms of requirements prescribed under Section 178(3) of the Companies Act, 2013, the Nomination and Remuneration Policy inter-alia providing the terms for appointment and payment of remuneration to Directors and Key Managerial Personnel is annexed to this Report as Annexure VI.

PARTICULARS OF EMPLOYEES

Disclosure with respect to the remuneration of Directors and employees as required under Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided under Annexure VII, which is annexed to this Report.

In terms of the provisions of first proviso to Section 136 (1) of the Companies Act, 2013, information pursuant to Section 1 97 of the Companies Act, 201 3 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is excluded from the Annual Report being sent to the Members of the Company and is available for inspection by the Members at registered office of the Company during business hours on working days up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary and the same shall be provided.

The full Annual Report including aforesaid information is being sent electronically to all those Members who have registered their email addresses and is also available on the website of the Company.

INTERNAL FINANCIAL CONTROLS

Based on the framework of internal financial controls and compliance systems established and maintained by the Company (with its inherent weaknesses), work performed by the internal, statutory and secretarial auditors and external consultants specially appointed for that purpose, including audit of internal financial controls over financial reporting by the statutory auditors, and the reviews performed by management and the relevant board committees, to the extent applicable, including the Audit Committee, the Company''s internal financial controls were adequate and effective during the period ended on 31st March, 2016. During the year under review, such controls were tested and no reportable weaknesses were observed.

GENERAL

1) The Company has not issued any equity shares with differential rights as to dividend, voting or otherwise.

2) The Whole Time Director has not received any commission from the Company nor any remuneration or commission from any of its holding or subsidiary company.

3) There are no significant / material orders passed by the regulators/courts/tribunals during the year under review which would impact the going concern status of your Company and its future operations.

4) During the year under review, there were no reported instances of cases filed pursuant to Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 134(5) of the Companies Act, 2013, with respect to Directors'' Responsibility Statement it is hereby confirmed that:

a) in the preparation of the annual accounts for the financial year ended 31st March, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2016 and of the profit or loss of the Company for that period;

c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) the Directors have prepared the annual accounts for the financial year ended 31st March, 2016, on a going concern basis.

e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

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

ACKNOWLEDGEMENT

Your Directors would like to thank and place on record their appreciation for the support and co-operation provided to your Company by its Shareholders, Future Group entities, and in particular, their employees, regulatory authorities and its bankers. Your Directors would also like to place on record their appreciation for the efforts put in by employees of the Company during the year.

On behalf of the Board of Directors

G. N. Bajpai

Chairman

Date: 19th May, 2016

Place: Mumbai


Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting the 19th Annual Report and the Audited Accounts of Future Consumer Enterprise Limited ["Company"], for the year ended 31st March, 2015.

FINANCIAL HIGHLIGHTS

The summarized financial performance (Standalone and Consolidated) of the Company for 2014-15 and 2013-14 is given below:

(RS. in Lakhs)

Standalone

2014-15 2013-14

Total Income 1,11,912.33 46,386.05

Profit/(Loss) before Tax & Exceptional (6,860.91) 3,040.90 Items

Less : Exceptional Items 2,514.00 -

Profit/(Loss) before Tax (9,374.91) 3,040.90

Profit/(Loss) After Tax (9,374.91) 3,040.90

Profit/(Loss) After Share of Associates & NA NA Minority Interest

Consolidated

2014-151 2013-14

Total Income 1,34,741.53 93,651.55

Profit/(Loss) before Tax & Exceptional (10,877.61) (1,590.47) Items

Less : Exceptional Items - -

Profit/(Loss) before Tax (10,87761) (1,590.47)

Profit/(Loss) After Tax (10,93703) (1,531.75)

Profit/(Loss) After Share of Associates & (10,276.42) (694.95) Minority Interest

BUSINESS OPERATIONS

Future Consumer Enterprise Limited has emerged as an integrated food company having businesses from farm to fork. Your Company has operations from sourcing, processing, branding and distribution.

During the year under review, your Company expanded its food portfolio by extending its brands to new categories like fruits and vegetables, canola and rice bran oils, frozen and processed food products. Your Company also further spread its wings in the Southern part of India by acquiring almost 100% stake in the 100 year of well established brand "Nilgiris 1905". This acquisition enabled an addition of 135 stores to the convenience store network, which has been expanded to 151 stores in fiscal 2014-15.

With the focus on integrated play, your Company has, during the year under review, consolidated its businesses by merging one of its wholly-owned subsidiary, Future Agrovet Limited which predominantly has been engaged into agro-sourcing operations. The Company has further acquired balance 30% stake of Aadhaar Wholesale Trading and Distribution Limited, the rural distribution format, pursuant to which Aadhaar Wholesale Trading and Distribution Limited is now a wholly-owned subsidiary of the Company.

With focus on enhancing core values for the business, your Company is moving towards withdrawal from non-core activities. As a step towards the same, your Company has decided to discontinue the business operations of saloon and spa services undertaken by its wholly-owned subsidiary Star and Sitara Wellness Limited. The financial statements for the fiscal ended on 31st March,2015, have taken into effect the impact of such discontinuance, details whereof are provided under note no. 44 in the notes to accounts forming part of this Annual Report.

Your Company continues to focus on food and FMCG business by spreading its distribution network though its chain of convenience stores, creating and investing in brands and exploring options to undertake new activities. As a step towards the same, your Company has entered into the business of procuring and distribution of fruits and vegetables, ready-to-eat products developed from the Food Park, which has become operational during the year under review. Your Company also has plans to enter into manufacturing activities by setting-up of flour mill and spice mill at the Food Park. Along with growing and developing its own portfolio of brands in the food space, your Company also partnered with niche players operating in product categories like oats, break-fast cereals, sauces, pastes etc. under joint venture arrangements. These initiatives are expected to yield results in financial year 2015-16.

Your Company has recorded total income of RS. 1,119.12 Crore and EBITDA loss of RS. 5.99 Crore in the current financial year as against a total income of RS. 463.86 Crore and EBITDA loss of RS. 32.71 Crore in the previous year. EBITDA loss of RS. 32.71 Crore in the previous year excludes one time gain on sale of investment of RS. 89.07 Crore to make it comparable.

For the financial year 2014-15, no appropriation is proposed to be made towards Reserves.

Save and except those mentioned in this Report, there were no material changes and commitments affecting the financial position of the Company between the end of financial year and the date of this Report.

FUTURE OUTLOOK

Innovation with speed and imagination is the concept which your Company believes into creating, launching and marketing new products and brands and extends in improving shopping process, range of products with focus on improving the customer"s overall experience. As Indian consumer has been increasing their aspirations and desires for consumption over the past years, their appetite to consume new and qualitative products in the home market has significantly increased.

India is the world"s second largest producer of food, next to China, and has the potential of being the biggest within the food and agricultural sector. The total food production in India is likely to double in the next ten years and there is an opportunity for large investments in food and food processing technologies, skills and equipment, especially in areas of Canning, Dairy and Food Processing, Specialty Processing, Packaging, Frozen Food/Refrigeration and Thermo Processing. Fruits & Vegetables, Fisheries, Milk & Milk Products, Meat & Poultry, Packaged/Convenience Foods, Alcoholic Beverages & Soft Drinks and Grains which are important sub-sectors of the food processing industry.

The broad-based decline in retail inflation since the last quarter of 2014, depressed commodity prices and the Government"s plan to step up infrastructure investments and focus on improving the ease of doing business with the concept of "Make in India" have improved the prospects for growth in the year 2015-16.

INITIAL PUBLIC OFFER ("IPO")

In terms of the provisions of Clause 5A of the Listing Agreement, details about unclaimed shares in suspense account as on 31st March, 2015 is as under:

Description No. of No. of Shareholders Shares

Aggregate number of shareholders 3 21,600 and outstanding shares in the suspense account as on 1st April,2014

Aggregate number of shareholders Nil NA who approached the Company for transfer from suspense account upto 31st March,2015

Number of shareholders to Nil NA whom shares were transferred from suspense account upto 31st March,2015

Aggregate number of shareholders 3 21,600 and outstanding shares in the suspense account as on 31st March,2015

The Company has opened separate suspense accounts with National Securities Depository Limited and Central Depository Services (India) Limited and has credited the said unclaimed shares to the suspense accounts in compliance with requirements of the Listing Agreement.

The voting rights in respect of shares maintained under the suspense account shall remain frozen till the rightful owner makes any claim over such shares.

Pursuant to the Composite Scheme of Arrangement and Amalgamation, 1 equity share of Future Lifestyle Fashions Limited ("FLFI") has been alloted to shareholders of Future Consumer Enterprise Limited for every 31 shares held by them. Accordingly, 696 shares of FLFL, arising out of 21,600 unclaimed shares, have also been credited to the suspense account, which aggregates to 22,296 unclaimed shares.

DIVIDEND

Your Directors have not recommended any dividend on equity shares for the financial year under review to conserve the funds for future business growth.

INCREASE IN SHARE CAPITAL

During the year under review, the Company has issued and allotted 1,32,49,000 equity shares of the Company to eligible employees on exercise of options granted under FVIL Employees Stock Option Plan - 2011. Consequently, the issued, subscribed and paid-up share capital of the Company increased from 1,59,79,76,671 equity shares of RS. 6 each to 1,61,12,25,671 equity shares of RS. 6 each.

Also, the Company has issued 4,59,18,367 equity shares on preferential basis to Godrej Agrovet Limited and Anamudi Real Estates LLP towards consideration payable for acquisition of 30% stake in Aadhaar Wholesale Trading and Distribution Limited.

Consequent to said allotment of equity shares, the paid up share capital of the Company stood increased to RS. 9,94,28,64,228 comprising of 1,65,71,44,038 equity shares of RS. 6 each.

Consequent to amalgamation of Future Agrovet Limited ("FAl"), a subsidiary of the Company, pursuant to the Scheme of Amalgamation approved by Hon"ble High Court at Bombay, the authorised share capital of FAL comprising of RS. 60,00,00,000 has been combined with the authorized share capital of the Company. In view of the same, the revised authorised share capital of the Company as on 31st March, 2015 is as follows:

Authorized Share Capital RS.

5,65,00,00,000 Equity Shares of RS.6 each 33,90,00,00,000

16700,00,000 unclassified shares of RS.10 16,70,00,00,000 each

TOTAL 50,60,00,00,000

ISSUE OF NON-CONVETIBLE DEBENTURES

During the year under review, your Company has issued 1,000 Secured, Rated, Listed, Redeemable, Non Convertible Debentures ("NCDs") having face value of RS. 10,00,000 each aggregating to RS. 100 Crore, on private placement basis. The NCDs are rated "Care A-" by Care Limited and are listed on Wholesale Debt Market of BSE Limited.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

As at 31st March, 2015, your Company had following Subsidiaries, Joint Ventures and Associate companies:

Sr. Name of the company Category No

1 Aadhaar Wholesale Trading and Distribution Subsidiary Limited

2 Future Food and Products Limited Subsidiary

3 Future Consumer Products Limited Subsidiary

4 Amar Chitra Katha Private Limited ("ACKPL") Subsidiary

5 ACK Edutainment Limited Subsidiary of ACKPL

6 ACK Media Direct Limited Subsidiary of ACKPL

7 IBH Books & Magazines Distributors Subsidiary of ACKPL Limited

8 Ideas Box Entertainment Limited Subsidiary of ACKPL

9 Karadi Tales Company Private Limited Subsidiary of ACKPL

10 Star and Sitara Wellness Limited Subsidiary

11 Express Retail Services Private Limited Subsidiary

12 Aussee Oats Milling (Private) Limited Subsidiary (With effect from 16th September,2014)

13 Integrated Food Park Private Limited Subsidiary (With effect from 5th February"2015)

14 Future Dairy and Bakery Products Private Subsidiary Limited (Originally known as ACK (With effect from Eaglemoss Collectibles Publishing 21st October,2014) Private Limited)

15 The Nilgiri Dairy Farm Private Limited Subsidiary ("NDFPL") (With effect from 20th November, 2014)

16 Appu Nutritions Private Limited Subsidiary of NDFPL

17 Nilgiri"s Mechanised Bakery Private Subsidiary of NDFPL Limited

18 Nilgiris Franchise Private Limited Subsidiary of NDFPL

19 Sublime Foods Private Limited Subsidiary (With effect from 18th February,2015)

20 Sarjena Foods Private Limited Associate (With effect from 5th July, 2014)

Pursuant to the Scheme of Amalgamation sanctioned by the Honorable High Court of Bombay,vide its order dated 30th January, 2015, Future Agrovet Limited, a whollyowned subsidiary has been amalgamated with the Company with effect from 1st April, 2014, being the Appointed Date under the said Scheme.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of financial statements of subsidiaries, associates and joint venture companies in Form AOC 1 is attached separately to this Annual Report.

The performance and financial position of each of the subsidiaries, associates and joint venture companies is provided under Management Discussions and Analysis Report which is presented separately and forms part of this Report.

In accordance to the provisions of Section 136(1) of the Companies Act, 2013, the Annual Report of the Company, containing therein standalone and the consolidated financial statements and the audited financial statements of each of the subsidiary companies have been placed on the website of the Company - www.futureconsumer.in.

The audited financial statements in respect of each subsidiary companies shall also be kept open for inspection at the Registered Office of the Company during working hours for a period of 21 days before the date of ensuing Annual General Meeting. The aforesaid documents relating to subsidiary companies can be made available to any Member interested in obtaining the same upon a request in that regards made to the Company.

The policy for determining material subsidiaries as approved by the Board of Directors of the Company is made available on the website of the Company - http://futureconsumer.in/policies-and-code.html

EXTRACT OF ANNUAL RETURN

In terms of provisions of Section 92(3) of the Companies Act,2013, an extract of Annual Return in prescribed format is annexed to this Report as Annexure I.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the year under review, Mr. Krishan Kant Rathi resigned as Chief Executive Officer of Company with effect from 31st October,2014 and has been appointed as an Additional Director of the Company with effect from 15th November, 2014. In accordance with the provisions of Section 161 of the Companies Act, 2013, Mr. Krishan Kant Rathi shall hold office only upto the date of forthcoming Annual General Meeting. Pursuant to the provisions of Section 160 of the Companies Act, 2013, the Company has received a notice from a Member proposing the candidature of Mr. Krishan Kant Rathi for the office of Director at the forthcoming Annual General Meeting.

Ms. Ashni Biyani has been appointed as Whole-time Director of the Company with effect from 15th November, 2014 for a period of 3 (three) years pursuant to the approval accorded by the Shareholders of the Company at an Extra Ordinary General Meeting held on 12th January,2015. In terms of the provisions of the Companies Act, 2013, Ms. Ashni Biyani retires from the Board of Directors of the Company by rotation at the ensuing Annual General Meeting and being eligible, has offered herself for re-appointment.

The Notice convening forthcoming Annual General Meeting includes the proposal for appointment / re-appointment of aforesaid Directors. A brief resume of the Directors seeking appointment /re-appointment at the forthcoming Annual General Meeting and other details as required to be disclosed in terms of Clause 49 of the Listing Agreement forms part of the said Notice. None of the Directors are disqualified for appointment / re-appointment under Section 164 of the Companies Act, 2013. None of the Directors are related inter-se to each other save and except Mr. Kishore Biyani and Ms. Ashni Biyani. Ms. Ashni Biyani is the daughter of Mr. Kishore Biyani.

During the year under review Mr. Anil Harish and Mr. B Anand have resigned from the Board of Directors of the Company with effect from 30th September, 2014 and 31st March, 2015 respectively. The Board of Directors wish to place on record their appreciation for the contributions made by Mr. Anil Harish and Mr. B Anand during their respective tenure as a member of the Board of Directors of the Company.

The Company has received individual declarations from following Independent Director(s) of the Company stating that they meet the criteria of independence as provided under Sub-section (6) of Section 149 of the Companies Act, 2013 and Clause 49 of the Listing Agreement entered into with Stock Exchanges :

a) Mr. G N Bajpai

b) Mr. Jagdish Shenoy

c) Ms. Vibha Rishi

d) Mr. Frederic de Mevius

During the year under review, Mr. Gopal Bihani resigned as Chief Financial Officer of the Company with effect from 1st September, 2014. Mr. Manoj Saraf has been appointed as Chief Financial Officer of the Company with effect from 2nd January, 2015.

AUDITORS AND AUDITORS' REPORT

M/s Deloitte Haskins & Sells, Chartered Accountants, have been appointed as the Statutory Auditors of the Company for a period of three years at the 18th Annual General Meeting held on 26th August,2014. In terms of the provisions of Companies Act, 2013 their appointment will however need to be ratified by the Shareholders at the forthcoming Annual General Meeting. Notice convening the forthcoming Annual General Meeting includes a proposal for ratification of appointment of Statutory Auditors by the Shareholders of the Company.

The notes on financial statements referred to in the Auditors Report are self-explanatory and do not call for any further comments and explanations. The Auditors" Report does not contain any qualification, reservation or adverse remark.

SECRETARIAL AUDITOR AND SECRETARIAL AUDIT REPORT

The Company has appointed M/s Sanjay Dholakia & Associates, Company Secretaries to conduct Secretarial Audit of the Company for the financial year 2014-15 in terms of provisions of Section 204 of the Companies Act, 2013. The Secretarial Audit Report is annexed to this Report as Annexure II. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

PARTICULARS OF LOANS GRANTED, GUARANTEE PROVIDED AND INVESTMENTS MADE PURSUANT TO THE PROVISIONS OF SECTION 186 OF THE COMPANIES ACT, 2013

Details of loans granted, guarantees provided and investments made by the Company under the provisions of Section 186 of the Companies Act, 2013, are provided in under Note No. 46, under Notes forming part of standalone financial statements.

RELATED PARTY TRANSACTIONS

All transactions entered into with related parties during the financial year under review were in the ordinary course of business and on arm"s length basis.

The particulars of contracts or arrangements with aforesaid related parties, in prescribed format is annexed to this Report as Annexure III.

The policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is available on the website of the Company - http://futureconsumer.in/policies-and-code.html

RBI REGULATIONS

With shift in main business activities, the Company is in process of de-registration with the Reserve Bank of India, as a Non Banking Financial Company.

PUBLIC DEPOSITS

Your Company has not been accepting any deposits from the public and hence there are no unpaid / unclaimed deposits nor is there any default in repayment thereof.

BOARD MEETINGS

The Board of Directors met 8 (Eight) times during the financial year 2014-15. The details of board meetings and the attendance of the Directors are provided in the Corporate Governance Report which forms part of this Annual Report.

COMMITTEES OF THE BOARD OF DIRECTORS

During the year under review, the Board has re-constituted some of its Committee(s) in terms of requirements prescribed under Companies Act, 2013 and Listing Agreement with the Stock Exchanges. During the year under review, the Board also constituted Corporate Social Responsibility Committee comprising of following members:

a) Mr. Jagdish Shenoy - Chairman

b) Mr. Kishore Biyani - Member

c) Ms. Vibha Rishi - Member

The Audit Committee comprises of following members:

a) Mr. G N Bajpai - Chairman

b) Mr. Jagdish Shenoy - Member

c) Ms. Vibha Rishi - Member

During the year under review, all recommendations made by the Audit Committee were accepted by the Board.There were no instances where the Board has not accepted any recommendation of the Audit Committee.

Details of Committees of Board of Directors along with their terms of reference, composition and meetings held during the year, are provided separately in the Corporate Governance Report, which forms part of this Annual Report.

PERFORMANCE EVALUATION OF BOARD

The Company has devised a policy for evaluation of Performance of the Board of Directors, its Committees and individual Directors ("Policy"). The evaluation involves assessment of performance individually of each of the Board Members and of the entire Board of Directors and its Committees.

The performance evaluation criteria of the entire Board of Directors inter alia comprised of the following key areas such as competencies and experience, quality of agenda notes circulated for board meetings, timelines for circulation of minutes, quality of recording board discussions, information sharing and communication, corporate governance process and disclosures.

The evaluation framework for assessing the performance of Committee(s) of Board of Directors inter-alia comprised of the following key areas such as composition of Members, deliverance of allocated responsibilities and qualitative Assessment/Responsibility.

The performance evaluation process of individual Directors inter alia comprised of the following key areas such as attendance at Board Meetings and Committee Meetings, preparedness for the Board and Committee Meeting(s), Contribution in the Board room using expertise, knowledge, experience and wisdom, independence of views and judgement, ownership of value building.

In terms of the Policy, a process of evaluation was undertaken by the Board for its own performance and that of its Committees and individual Directors. The evaluation process focused on various aspects of the functioning of the Board and Committees. Separate exercise was carried out to evaluate the performance of individual Directors on specified parameters.

The outcome of evaluation process was shared with the Board, Chairman of respective Committees and individual Directors. Based on the outcome of the evaluation, the Board and Committees have agreed on an action plan for the identified areas.

The details of programme for familiarisation of Independent Directors with the Company, industry in which it operates, their roles, rights, responsibilities is made available on the website of the Company - http://futureconsumer.in/policies-and-code.html

CORPORATE GOVERNANCE

A report on Corporate Governance together with Auditors" Certificate as required under Clause 49 of the Listing Agreement forms part of this Annual Report.

MANAGEMENT DISCUSSION & ANALYSIS REPORT

The Management Discussion & Analysis Report as required under Clause 49 of the Listing Agreement is presented separately and forms part of this Report.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the provisions of Companies Act, 2013 and Accounting Standards prescribed by the Institute of Chartered Accountants of India in this regard, the audited consolidated financial statements are provided in this Annual Report.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established a vigil mechanism to provide a framework to promote responsible and secure whistle blowing and to provide a channel to the employee(s) and Directors for reporting to the management, concerns about unethical behavior, actual or suspected fraud or violation of the code of conduct or policy/ies of the Company, as adopted / framed from time to time. The details of said vigil mechanism is given in Corporate Governance Report, which forms part of this Annual Report.

PARTICULARS OF EMPLOYEE STOCK OPTION PLAN

The Company has formulated following employee stock options schemes:

a. FVIL Employees Stock Option Plan-2011 ("FVIL ESOP-2011")

b. Future Consumer Enterprise Limited Employee Stock Option Plan - 2014 ("FCEL ESOP-2014")

FCEL ESOP - 2014 has been approved by the Shareholders of the Company vide resolution passed at an Extra Ordinary General Meeting held on 12th January, 2015. The Shareholders of the Company have at aforesaid Extra Ordinary General Meeting also approved formation of Future Consumer Enterprise Employees Welfare Trust for implementation of FCEL ESOP-2014.

The details of options granted and exercised under FVIL ESOP-2011 are provided in Annexure IV, which is annexed to this Report.

No options have been granted under FCEL ESOP-2014 during the year under review.

PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, EXPENDITURE ON RESEARCH AND DEVELOPMENT, FOREIGN EXCHANGE EARNINGS AND OUTGO ETC

Considering the nature of activities in which the Company operates, energy consumption is in accordance to the normal business practices and does not require any specific installations. In its regular course of business, the Company is always vigilant to conserve the resources and continuously implements measures required to save energy.

The business activities of the Company is not specific to any technology requirements. In the course of its operations, processes are formed and implemented to achieve operational efficiencies which provide maintaining product quality and cost control.

The details in respect of Foreign Exchange earnings/ outgo during the year under review, is provided in Note No. 33 under Notes forming part of standalone financial statements.

RISK MANAGEMENT POLICY AND INTERNAL ADEQUACY

Your Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. Your Company"s internal control systems are commensurate with the nature of its business and the size and complexity of its operations. These are routinely tested by Statutory as well as Internal Auditors. Significant audit observations and follow up actions thereon are reported to the Audit Committee.

CORPORATE SOCIAL RESPONSIBILITY

The Company has constituted a Corporate Social Responsibility Committee ("CSR Committee") in accordance with the provisions of Section 135 of the Companies Act, 2013. The Board of Directors of the Company has based on recommendations made by the CSR Committee approved Corporate Social Responsibility Policy of the Company.

The disclosures as per Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is made in prescribed form which is annexed to this Report as Annexure V.

NOMINATION AND REMUNERATION POLICY

In terms of requirements prescribed under Section 178(3) of the Companies Act, 2013, the Nomination and Remuneration Policy inter-alia providing the terms for appointment and payment of remuneration to Directors and Key Managerial Personnel is annexed to this Report as Annexure VI.

PARTICULARS OF EMPLOYEES

Disclosures with respect to the remuneration of Directors and employees as required under Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided under Annexure VII, which is annexed to this Report.

In terms of the provisions of first proviso to Section 136 (1) of the Companies Act, 2013, information pursuant to Section 197 of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is excluded from the Annual Report being sent to the Members of the Company and is available for inspection by the Members at registered office of the Company during business hours on working days up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary and the same shall be provided.

The full Annual Report including aforesaid information is being sent electronically to all those Members who have registered their email addresses and is also available on the website of the Company.

INTERNAL FINANCIAL CONTROLS

Your Company has in place adequate internal financial controls with reference to financial statements. During the year under review, such controls were tested and no reportable material weaknesses were observed.

GENERAL

1) The Company has not issued any equity shares with differential rights as to dividend, voting or otherwise.

2) The Whole Time Director has not received any commission from the Company nor any remuneration or commission from any of its holding or subsidiary company.

3) There are no significant / material orders passed by the regulators/courts/tribunals during the year under review which would impact the going concern status of your Company and its future operations.

4) During the year under review, there were no reported instances of cases filed pursuant to Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 134(5) of the Companies Act, 2013, with respect to Directors' Responsibility Statement it is hereby confirmed that:

a) in the preparation of the annual accounts for the financial year ended 31st March, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March,2015 and of the profit or loss of the Company for that period;

c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) the Directors have prepared the annual accounts for the financial year ended 31st March, 2015, on a going concern basis.

e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

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

ACKNOWLEDGEMENT

Your Directors would like to thank and place on record their appreciation for the support and co-operation provided to your Company by its Shareholders, Future Group entities, and in particular, their employees, regulatory authorities and its bankers. Your Directors would also like to place on record their appreciation for the efforts put in by employees of the Company during the year.

On behalf of the Board of Directors

G. N. Bajpai Chairman

Date: 15th May, 2015 Place: Mumbai


Mar 31, 2013

Dear Shareholders,

The Directors have pleasure in presenting the 17th Annual Report and the Audited Accounts of Future Ventures India Limited ("Company"), for the year ended 31st March, 2013.

FINANCIAL HIGHLIGHTS

The summarized fi nancial performance (Standalone and Consolidated) of the Company for 2012-13 and 2011-12 is given below:

(Rs.in Lakhs)

Standalone Consolidated 2012-13 2011-12 2012-13 2011-12

Total Income 35,796.92 5,531.72 96,018.45 86,041.10

Profit / (Loss) before Tax & Exceptional Items (1,104.99) 2,255.25 (7,173.08)(2,335.73)

Less: Exceptional Items 3,100.30 3,322.77

Profi t / (Loss) before Tax (1,104.99) (845.05) (7,173.08)(5,658.50)

Profi t / (Loss) After Tax (1,144.81)(1,366.99) (7,655.52) (6,538.72)

Profi t / (Loss) After Share of Associates and Minority Interest - (5,571.55)(4,176.64)

The financials for the year under review are not comparable with the previous year as underlying business has undergone substantial transformation during the year.

COMPOSITE SCHEME OF ARRANGEMENT AND AMALGAMATION

During the year under review, the Company has fi led the following two Composite Scheme(s) of Arrangement and Amalgamation with the Hon''ble High Court having appropriate jurisdiction:

a) Composite Scheme of Arrangement and Amalgamation between the Company and Indus-League Clothing Limited and Lee Cooper (India) Limited and Pantaloon Retail (India) Limited (now known as Future Retail Limited) and Future Lifestyle Fashions Limited and their respective shareholders and creditors ("Fashion Scheme"); and

b) Composite Scheme of Arrangement and Amalgamation between the Company and Future Consumer Enterprises Limited and Express Retail Services Private Limited and Think Fresh International Private Limited and their respective shareholders and creditors ("Food Scheme").

The Fashion Scheme and the Food Scheme, except the part comprising of transfer of entire business and undertakings of Express Retail Services Private Limited and that of Think Fresh International Private Limited in the Company, as a going concern ("Remaining Part"), has been approved by the Hon''ble High Court, at Bombay vide its order dated 10th May, 2013. For the Remaining Part of the Food Scheme, fi led before the Hon''ble High Court at Delhi, the matter is scheduled for hearing on 25th July, 2013.

In respect of the schemes approved by the Hon''ble High Court at Bombay, the Company has made necessary fi lings with the Registrar of Companies, Mumbai and the same have been made effective from the respective Appointed Dates mentioned therein.

As a consequence to the above mentioned schemes coming into effect, the Company is now engaged in operating Food and FMCG outlets and distribution in Urban and Rural areas with its own branded products in addition to the third party brands and products. The Company is accordingly seeking de-registration as a Non-Banking Financial Company with the Reserve Bank of India. Also, the face value of equity shares of the Company shall be reduced from Rs.10/- per equity share to Rs. 6/- per equity share from the Record date i.e. 24th June, 2013.

FUTURE OUTLOOK

With consolidation of business, the Company will predominantly be focussed on Food and FMCG activities which constitutes a signifi cant portion of the household expenditure. The Company expects the domestic market for Food and FMCG to continue expanding, despite pressure on overall economic growth. The Company is positioned for the anticipated growth in business with an appropriate structure, strategy and capabilities. The Company''s initiative in integrated food play by combining its Brands, Distribution both urban and rural and Food processing capabilities, into formation of Food park, will capture the entire value chain of Food processing from Farm to Fork.

The Company is now part of Food sector which forms essential part of consumption. The increasing propensity to consume Food in its varied form due to rising income levels, augers well for a stable growth of business. The increasing urbanisation is fueling the demand for better environment for shopping of essentials due to which the Company foresees rapid growth in opportunities for both urban and rural Distribution formats.

The Company believes that the change in approach will result in faster and better value creation for its Stakeholders.

INITIAL PUBLIC OFFER ("IPO")

In terms of the provisions of Clause 5A of the Listing Agreement, details about unclaimed shares in suspense account as on 31st March, 2013 is as under:

Description No. of Shareholders No. of Shares

Aggregate number of shareholders and outstanding shares in the suspense account 7 34,800 as on 1st April, 2012

Aggregate number of shareholders who approached the Company for transfer from 3 9,600 suspense account upto 31st March, 2013

Number of shareholders to whom shares were transferred from suspense account 3 9,600 upto 31st March, 2013

Aggregate number of shareholders and outstanding shares in the suspense account 4 25,200 as on 31st March, 2013

The Company has opened separate suspense account with Depository Participant of National Securities Depository Limited and Central Depository Services Limited and has credited the said unclaimed shares to the suspense accounts in compliance with requirements under the Listing Agreement.

The voting rights in respect of shares maintained under the suspense accounts shall remain frozen till the rightful owner(s) of such shares lodge their claims for the same.

DIVIDEND

Your Directors have not recommended any dividend on equity shares for the fi nancial year under review due to non availability of profi t for appropriation.

SUBSIDIARY COMPANIES

As on 31st March, 2013, your Company had following subsidiaries:

i) Aadhaar Wholesale Trading and Distribution Limited (formerly Aadhaar Retailing Limited)

ii) Future Consumer Enterprises Limited

iii) Future Consumer Products Limited

iv) Amar Chitra Katha Private Limited

v) ACK Edutainment Limited

vi) ACK Media Direct Private Limited

vii) IBH Books & Magazines Distributors Private Limited

viii) Ideas Box Entertainment Limited

ix) Karadi Tales Company Private Limited

x) ACK Eaglemoss Collectibles Publishing Private Limited

xi) Star and Sitara Wellness Private Limited

xii) Express Retail Services Private Limited

xiii) Think Fresh International Private Limited

Pursuant to the general circular No. 2/2011 dated 8th February, 2011 issued by Ministry of Corporate Affairs ("MCA"), general exemption has been granted by MCA, subject to conditions prescribed therein, in terms of which copies of balance sheet, the profi t and loss account, report of the Board of Directors and that of the Auditors in respect of the subsidiaries as at 31st March, 2013 have not been attached to the Balance Sheet of your Company.

The aforesaid documents in respect of the respective subsidiary companies can be made available upon a request to the Company from the Shareholders interested in obtaining the same. The documents in respect of aforesaid subsidiary companies are also available for inspection at the registered offi ce of the Company on any working day during business hours. As directed by MCA, the fi nancial data of subsidiaries has been furnished under ‘Financial Information on Subsidiary Companies'' forming part of this Annual Report.

RBI REGULATIONS

During the year under review, your Company is in compliance with the applicable regulations prescribed by the Reserve Bank of India ("RBI"). Upon the Composite Scheme of Arrangement and Amalgamation becoming effective from 29th May, 2013, the Company ceases to be a Non Deposit Accepting or Holding Systemically Important Non-Banking Finance Company.

PUBLIC DEPOSITS

Your Company has not accepted any deposits from the public during the year under review and shall not accept any deposits without obtaining necessary approvals as may be required.

DIRECTORS

Mr. Frederic de Mevius and Mr. Krishan Kant Rathi have been appointed as Additional Director of the Company with effect from 9th November, 2012 and 31st May, 2013 respectively. In accordance with the provisions of Section 260 of the Companies Act,1956, the Additional Directors so appointed shall hold offi ce only upto the date of the forthcoming Annual General Meeting. In accordance with the provisions of the Section 257 of the Companies Act, 1956, the Company has received individual notice from Member(s) of the Company proposing candidature of Mr. Frederic de Mevius and Mr. Krishan Kant Rathi for offi ce of Director.

Mr. Kishore Biyani has stepped down as the Managing Director of the Company to come into effect from 31st May, 2013. The Board of Directors have designated Mr. Kishore Biyani as the Vice Chairman of the Company to come into effect from 31st May, 2013. The Board of Directors of Company have, subject to approval of the Shareholders and the Central Government, appointed Mr. Krishan Kant Rathi as Whole Time Director of the Company designated as an ‘Executive Director and Chief Executive Offi cer'' to come into effect from 31st May, 2013.

In terms of the provisions of the Companies Act, 1956, Mr. Anil Harish and Mr. Jagdish Shenoy retire from the Board of Directors of the Company by rotation and being eligible, have offered themselves for re-appointment at the forthcoming Annual General Meeting. None of the Directors are disqualifi ed for appointment / re-appointment under Section 274(1)(g) of the Companies Act,1956.

The Notice convening the forthcoming Annual General Meeting include the proposals for appointment / re-appointment of aforesaid Directors. A brief resume of the Directors seeking appointment / re-appointment at the forthcoming Annual General Meeting and other details as required to be disclosed in terms of Clause 49 of the Listing Agreement forms part of the said Notice. None of the Directors are related inter-se to each other.

CORPORATE GOVERNANCE

A report on Corporate Governance together with Auditors'' Certifi cate as required under Clause 49 of the Listing Agreement forms part of this Annual Report.

MANAGEMENT DISCUSSION & ANALYSIS REPORT

The Management Discussion & Analysis Report as required under Clause 49 of the Listing Agreement is presented separately and forms part of this Annual Report.

CONSOLIDATED FINANCIAL STATEMENTS

Your Directors have pleasure in attaching the Consolidated Financial Statements pursuant to Clause 32 of the Listing Agreement entered into with the Stock Exchanges and prepared in accordance with the Accounting Standards prescribed by the Institute of Chartered Accountants of India in this regard.

AUDITORS AND AUDITORS'' REPORT

M/s Deloitte Haskins & Sells, Chartered Accountants (Registration No. 008072S), the Statutory Auditors of the Company who hold offi ce until conclusion of the forthcoming Annual General Meeting have expressed their unwillingness to be re-appointed at the forthcoming Annual General Meeting. The Company proposes to appoint M/s Deloitte Haskins & Sells, Chartered Accountants (Registration No. 117364W), as Statutory Auditors of the Company.

M/s Deloitte Haskins & Sells, Chartered Accountants (Registration No. 117364W), have issued confi rmation to the Company as required under Section 224 (1B) of the Companies Act, 1956, to the effect that their appointment, if made, would be within the limits specifi ed in the said Section.

The notes on fi nancial statements referred to in the Auditors Report are self-explanatory and do not call for any further comments and explanations.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 217 (2AA) of the Companies Act, 1956, with respect to Directors'' Responsibility Statement it is hereby confi rmed:

a) that in the preparation of the annual accounts for the fi nancial year ended 31st March, 2013, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2013 and of the profi t or loss of the Company on that date;

c) that the Directors have taken proper and suffi cient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) that the Directors have prepared the annual accounts for the fi nancial year ended 31st March, 2013, on a going concern basis.

PARTICULARS OF EMPLOYEES AND EMPLOYEE STOCK OPTION PLAN - 2011

In accordance with the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended, the name and other particulars of certain employees are required to be set out in an Annexure to the Directors'' Report. Having regard to the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956, the Directors'' Report excluding the aforesaid information is being sent to all the Shareholders of the Company and others entitled thereto. Shareholders who are interested in obtaining such particulars may write to the Company at its Registered Offi ce.

The disclosures as required under the Securities and Exchange Board of India (Employee Stock Option Scheme & Employee Stock Purchase Scheme) Guidelines, 1999 are annexed and forms part of this Report (Annexure 1).

PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, EXPENDITURE ON RESEARCH AND DEVELOPMENT, FOREIGN EXCHANGE INFLOW/OUTFLOW ETC

In view of the nature of activities carried on by the Company, the requirements for disclosure in respect of Conservation of Energy as per Form A and disclosures with respect to technology absorption as per Form B prescrbed under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are not applicable to the Company. The Company in the regular course of business takes all possible efforts towards energy conservation.

The details in respect of Foreign Exchange earnings/ outgo during the year under review, is provided in Note No. 34 in Notes to Accounts.

ACKNOWLEDGEMENT

Your Directors would like to thank and place on record their appreciation for the support and co-operation provided to your Company by its Shareholders, regulatory authorities, bankers and Future Group entites including their employees. Your Directors would also like to place on record their appreciation for the efforts put in by employees of the Company during the year.

For and on behalf of the Board of Directors

G.N. Bajpai Chairman

Date : 30th May, 2013

Place: Mumbai


Mar 31, 2012

FINANCIAL HIGHLIGHTS

The summarised financial performance (Standalone and Consolidated) of the Company for 2011-12 and 2010-11 is given below:

(Rs. lakhs)

Standalone Consolidated

2011-12 2010-11 2011-12 2010-11

Total Income 5,531.72 1,311.64 86,041.10 54,926.12

Profit / (Loss) before Tax & Exceptional Items 2,255.25 352.78 (2,335.73) (3,219.27)

Less: Exceptional Items 3,100.30 448.03 3,322.77 448.03

Profit / (Loss) before Tax (845.05) (95.25) (5,658.50) (3,667.30)

Profit / (Loss) After Tax (1,366.99) (67.25) (6,538.72) (3,940.97)

Profit / (Loss) After Share of Associates and Minority Interest - - (4176.64) (2751.92)

Profit / (Loss) available for appropriation (1,532.32) (165.33) (14,461.95) (10,305.47)

Balance carried to Balance Sheet (1,532.32) (165.33) (14,461.95) (10,305.47)

Performance during the year under review

On a standalone basis the total income for the current year was Rs. 5,531.72 lakhs as against Rs. 1,311.64 lakhs showing an increase of 322% over previous year. The expenses towards Initial Public Offer of Rs. 3,100.30 lakhs incurred during the year have been charged against the current year's profit. The profit after tax was Rs. 1,733.31 lakhs before charging of IPO expenses.

On a consolidated basis our total income increased to Rs. 86,041.10 lakhs in fiscal 2012 from Rs. 54,926.12 lakhs in fiscal 2011 thereby registering a growth of 57%. On consolidated basis loss after tax (before IPO expenses) was Rs. 3,438.42 lakhs for the current year.

Your Company does not have any indebtedness on a standalone basis. Your Company's secured and unsecured debt position as at 31st March, 2012 is on account of consolidated reporting.

The year under review has been significant for the Company. Your Company has strengthened its position in the Fashion, Rural Distribution, Food and FMCG sectors by investing further in companies like Indus- League Clothing Limited, Holii Accessories Private Limited, Indus-Tree Crafts Private Limited, Aadhaar Retailing Limited, Future Consumer Enterprises Limited, Future Consumer Products Limited and Capital Foods Exportts Private Limited. Your Company has also strengthened its position in edutainment business by making further investment in Amar Chitra Katha Private Limited thus increasing its stake from 13.65% to 65.84% (on fully diluted basis).

Your Company has during the year under review, made investment in one new business venture viz. Clarks Future Footwear Limited (Clarks), a 50:50 joint venture between the Company and C & J Clark International Limited, England.

Details of the financial performance of each of various business segments are discussed in the Management Discussion and Analysis Report, which is annexed and forms an integral part of the Directors' Report.

Future outlook

Despite the declining growth of the Indian economy, during the year under review, our businesses have performed reasonably well. We believe that while global economic outlook seems grim, the Indian growth should again pick up the pace rapidly. The inherent strengths of Indian economy like favourable demographics, entrepreneurship spirit, increasing aspirational population will continue to drive the consumption at a much faster pace. We hope that after a long pause, the Government will resume the reform process and unlock the growth potential at a larger scale. Our businesses are well positioned to take advantage of the next wave of growth in consumption, which we believe is imminent.

Initial public offer

Post completion of initial public offer (IPO) of equity shares during May, 2011, your Company has utilized part of the funds raised under the IPO as per the objects of the Issue.

In terms of the provisions of Clause 5A of the Listing Agreement, details about unclaimed shares under IPO in suspense account as on 31st March, 2012 is as under:

Description No. of No. of Shares Shareholders

Aggregate number of shareholders and outstanding shares in the 26 91,200 suspense account as on the date of allotment i.e 5th May, 2011

Aggregate number of shareholders who approached the Company 18 55,200 for transfer from suspense account upto 31st March, 2012

Number of shareholders to whom shares were transferred from 18 55,200 suspense account upto 31st March, 2012

Aggregate number of shareholders and outstanding shares in the 8 36,000* suspense account as on 31st March, 2012

* includes 1,200 shares not credited to the suspense account on 31st March, 2012 for technical reasons, which have been credited subsequently.

The Company has opened separate suspense account with National Securities Depository Limited and Central Depository Services Limited and has credited the said unclaimed shares to the Suspense Accounts in compliance with requirements of the Listing Agreement.

The voting rights in respect of shares maintained under the Suspense Account shall remain frozen till the rightful owner of such shares claims the shares.

Dividend

Your Directors have not recommended any dividend on equity shares for the financial year under review due to non availability of profit for appropriation.

Subsidiary companies

As at 31st March, 2012, your Company had following subsidiaries:

- Indus-League Clothing Limited

- Indus Tree Crafts Private Limited

- Indus Tree Producer Transform Private Limited

- Aadhaar Retailing Limited

- Future Consumer Enterprises Limited

- Future Consumer Products Limited

- Lee Cooper (India) Limited

- Amar Chitra Katha Private Limited

- ACK Edutainment Private Limited

- ACK Media Direct Private Limited

- IBH Books & Magazines Distributors Private Limited

- Ideas Box Entertainment Private Limited

- Karadi Tales Company Private Limited

- ACK Eaglemoss Collectibles Publishing Private Limited

Pursuant to the general circular No. 2/2011 and 3/2011 dated 8th February, 2011 and 21st February, 2011 respectively issued by Ministry of Corporate Affairs (MCA) and in terms of the general exemption granted by MCA, copies of Balance Sheet, the Statement of Profit and Loss, report of the Board of Directors and that of the Auditors in respect of the subsidiaries as at 31st March, 2012 have not been attached to the Balance Sheet of your Company.

The aforesaid documents in respect of the respective subsidiary companies can be made available upon a request made to the Company from the Shareholders interested in obtaining the same. The documents in respect of aforesaid subsidiary companies are also available for inspection at the registered office of the Company on any working day during business hours. As directed by MCA, the financial data of subsidiaries has been furnished under the section 'Financial Information on Subsidiary Companies' forming part of this Annual Report.

RBI regulations

Your Company is a Non-Deposit Accepting or Holding Systemically Important Non-Banking Finance Company (SI-ND-NBFC) and is in compliance with the applicable regulations prescribed by the Reserve Bank of India (RBI). On an application made by the Company, RBI has granted provisional exemption to the Company from compliance to thresholds prescribed under Para 18 of the Prudential Norms in respect of concentration of credit/investment norms.

In terms of the framework of RBI, the Company has made an application for registration as a Core Investment Company.

Public deposits

Your Company has not accepted any deposits from the public during the year under review and shall not accept any deposits without obtaining prior approval of the Reserve Bank of India.

Directors

Ms. Vibha Rishi has been appointed as an Additional Director of the Company with effect from 14th February, 2012. In accordance with the provisions of Section 260 of the Companies Act,1956, Ms. Vibha Rishi shall hold office only upto the date of the ensuing Annual General Meeting. In accordance with the provisions of the Section 257 of the Companies Act, 1956, the Company has received notice from a Member of the Company proposing her candidature for office of a Director.

In terms of the provisions of the Companies Act, 1956, Mr. B. Anand and Mr. G. N. Bajpai retire from the Board of Directors of the Company by rotation and being eligible, have offered themselves for re-appointment at the ensuing Annual General Meeting. None of the Directors are disqualified for appointment / re-appointment under Section 274(1 )(g) of the Companies Act,1956.

The Notice convening the ensuing Annual General Meeting include the proposals for appointment / re- appointment of aforesaid Directors. A brief resume of the Directors seeking appointment / re-appointment at the ensuing Annual General Meeting and other details as required to be disclosed in terms of Clause 49 of the Listing Agreement forms part of the Notice for the ensuing Annual General Meeting. None of the Directors are related inter-se to each other.

Corporate governance

A report on Corporate Governance together with Auditors' Certificate as required under Clause 49 of the Listing Agreement forms part of this Annual Report.

Management discussion & analysis report

The Management Discussion & Analysis Report as required under Clause 49 of the Listing Agreement is presented separately and forms part of this Annual Report.

Consolidated financial statements

Your Directors have pleasure in attaching the Consolidated Financial Statements pursuant to Clause 32 of the Listing Agreement entered into with the Stock Exchanges and prepared in accordance with the Accounting Standards prescribed by the Institute of Chartered Accountants of India in this regard.

Auditors and auditors' report

M/s Deloitte Haskins & Sells, Chartered Accountants, the Statutory Auditors of the Company hold office until conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. The Statutory Auditors have issued a letter to the Company as required under Section 224 (1B) of the Companies Act, 1956, to the effect that their re-appointment, if made, would be in conformity with the limits specified in the said Section.

Directors' responsibility statement

Pursuant to the requirements of Section 217 (2AA) of the Companies Act, 1956, with respect to Directors' Responsibility Statement it is hereby confirmed:

(a) that in the preparation of the annual accounts for the financial year ended 31st March, 2012, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

(b) that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March,2012 and of the profit or loss of the Company on that date;

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

(d) that the Directors have prepared the annual accounts for the financial year ended 31st March, 2012, on a going concern basis.

Particulars of employees and employees stock option plan-2011

In accordance with the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended, the name and other particulars of certain employees are required to be set out in an Annexure to the Directors' Report. Having regard to the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956, the Directors' Report excluding the aforesaid information is being sent to all the Shareholders of the Company and others entitled thereto. Shareholders who are interested in obtaining such particulars may write to the Company at its Registered Office.

The disclosures as required under the Securities and Exchange Board of India (Employee Stock Option Scheme & Employee Stock Purchase Scheme) Guidelines, 1999 (SEBI Guidelines) are annexed and forms part of this Report (Annexure 1).

The Company has received the Certificate from its Statutory Auditors stating that the scheme has been implemented in accordance with SEBI Guidelines and resolution passed by the Shareholders.

Particulars of energy conservation, technology absorption, expenditure on research and development, foreign exchange inflow/outflow etc

In view of the nature of activities carried on by the Company, the requirements for disclosure in respect of Conservation of Energy, Technology Absorption, in terms of the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are not applicable to the Company. However the Company takes all possible efforts towards energy conservation.

The requirement for disclosure with regard to technology absorption does not apply to the Company as the activities in which the Company operates does not require any technology.

The details in respect of Foreign Exchange earnings/ outgo during the year under review, is provided in Note no. 31 under Notes to Accounts.

Acknowledgement

Your Directors would like to thank and place on record their appreciation for the support and co-operation provided to your Company by its Shareholders, Future Group entities, and in particular, their employees, regulatory authorities and its bankers. Your Directors would also like to place on record their appreciation for the efforts put in by employees of the Company during the year.

For and on behalf of the Board of Directors

G. N. Bajpai

Chairman

Date: 24th May, 2012

Place: Mumbai


Mar 31, 2011

Dear Shareholders,

The Directors take pleasure in presenting the 15th Annual Report and the Audited Accounts of Future Ventures India Limited ("Company"), for the year ended 31st March, 2011.

FINANCIAL HIGHLIGHTS

The summarized financial performance of the Company for 2010-11 and 2009-10 is given below:

(Amount Rs. In Lakhs)

STANDALONE CONSOLIDATED 2010-11 2009-10 2010-11 2009-10

Total Income 1,311.64 2,575.72 54,922.91 17,823.39

Profit/(Loss) before 358.69 2,113.41 (685.94) (1,080.89) Depreciation & Tax

Less: Depreciation 5.90 11.57 2,533.35 862.19

Profit before Tax & 352.79 2,101.84 (3,219.29) (1,943.08)

Exceptional Items

Less: IPO Expenses 448.03 - 448.03 -

Profit/(Loss) before Tax (95.24) 2,101.84 (3,667.32) (1,943.08)

Less: Provision for Tax (28.00) 426.31 273.66 159.48

profit After Tax (67.24) 1,675.53 (3,940.98) (2,102.56)

Add: Share of Associates - - 383.16 36.87

Profit/(Loss)

Add: Share of Minority Interest - - 861.86 1,022.17

Add : Adjustment on - - (55.97) -

Acquisition of Subsidiaries

Profit/(Loss) after Share of Associates and Minority - - (2,751.93) (1,043.52)

Interest Add: Profit/(Loss) brought (98.09) (1,438.51) (7,548.05) (6,227.17) forward from previous year

Add : Adjustment on Acquisition of Subsidiaries / I - - (5.51) 57.75 Consolidation

Profit/(Loss) available for (165.33) 237.02 (10,305.49) (7,212.94) appropriation

Transfer to Statutory - 335.11 - 335.11 Reserve Transfer to General Reserve

Balance carried to Balance (165.33) (98.09) (10,305.49) (7,548.05) Sheet

PERFORMANCE DURING THE YEAR

UNDER REVIEW

On a stand alone basis, the income from operations for the current year was ^ 1,311.64 Lakhs as against Rs. 1,190.28 Lakhs (excluding income from trading securities Rs. 1,385.44 Lakhs) showing an increase of 10% over previous year. The expenses towards Initial Public Offer ofRs. 448.03 Lakhs incurred during the year have been charged against the current year's profit.

On a consolidated basis, our total income increased to Rs. 54,922.91 Lakhs in Fiscal 2011 from Rs. 17,823.39 Lakhs in Fiscal 2010, thereby registering a growth of 208%.

The Company does not have any indebtedness on a standalone basis. The Company's secured and unsecured debt position as on 31st March, 2011 is on account of consolidated reporting.

The year under review has been significant for the Company. Your Company has further strengthened its position in the Fashion, Rural Distribution, Food and FMCG sectors by investing further in companies like Indus-League Clothing Limited, Future Consumer Enterprises Limited, Future Consumer Products Limited, Holii Accessories Private Limited and Aadhaar Retailing Limited.

The Company has entered into new business segments such as edutainment by making investment in new business venture Amar Chitra Katha Private Limited.

Following the investments made by the Company, its presence in the consumption-led sectors as on 31st March, 2011 stands to 13 business ventures. The Company has during the year under review, divested its stake in Star Shopping Centres Private Limited and SSIPL Retail Limited.

The details of the financial performances of each of our businesses are discussed in the Management Discussion and Analysis Report, which is annexed and forms an integral part of the Directors' Report.

FUTURE OUTLOOK

The Company continues to create businesses and mentoring entrepreneurs to catalyze disproportionate growth in Fashion, Food, FMCG and Rural Distribution. The Company shall look out for new opportunities for entering in businesses and brands that can cater to the changing needs of new age India and have permanently and constantly growing demand. Our focus shall be to create a portfolio of businesses, where each of the brands has a sharp and distinct positioning.

Driven by strong domestic consumption demand, we expect the businesses in these sectors to grow substantially in the coming years. While focusing on product development, brand positioning we shall continue to expand geographically and deepen our reach through EBOs, MBOs and other distribution network. We shall monitor the various efficiency parameters and working capital management of these businesses thereby contributing and improving the profitability of the Company.

INITIAL PUBLIC OFFER ("IPO")

Your Company successfully completed initial public offer ("IPO") of equity shares during May, 2011. Your Company has raised an amount of Rs. 75,000 Lakhs through the IPO. The equity shares of the Company are now listed on Bombay Stock Exchange Limited and National Stock Exchange of India Limited which commenced trading on 10th May, 2011.The IPO proceeds will be deployed as per the objects of the Issue.

Your Directors take this opportunity to thank all the Shareholders for investing in the Company.

In terms of the provisions of Clause 5A of the Listing Agreement, details about unclaimed shares in suspense account as on 30th June, 2011 is as under:

NO. OF NO. OF

DESCRIPTION SHAREHOLDERS SHARES

Aggregate number of shareholders and outstanding shares in the suspense account as on the date of allotment i.e 5th May, 2011 26 91,200

Number of shareholders who approached the Company for transfer of shares from suspense account upto 30th June, 2011 8 29,400

Number of shareholders to whom shares were transferred from suspense account upto 30th June, 2011 8 29,400

Aggregate number of shareholders and outstanding shares in the suspense account as on 30th June, 2011 18 61,800

The Company has opened separate suspense account with National Securities Depository Limited and Central Depository Services (India) Limited and has credited the said unclaimed shares to the suspense accounts in compliance with requirements of the Listing Agreement.

The voting rights in respect of shares maintained under the suspense accounts shall remain frozen till the rightful owner of such shares claims the shares.

DIVIDEND

Your Directors have not recommended any dividend on equity shares for the financial year under review due to non-availability of profit for appropriation.

SUBSIDIARY COMPANIES

During the year under review, your Company had following subsidiaries:

- Indus-League Clothing Limited

- Indus Tree Crafts Private Limited

- Aadhaar Retailing Limited

- Future Consumer Enterprises Limited

- Future Consumer Products Limited

- Lee Cooper (India) Limited

Pursuant to the general circular No. 2/2011 and 3/2011 dated 8th February, 2011 and 21st February, 2011 respectively issued by Ministry of Corporate Affairs ("MCA") and in terms of the general exemption granted by MCA copies of balance sheet, the profit and loss account, report of the Board of Directors and that of the Auditors in respect of the subsidiaries as on 31st March, 2011 have not been attached to the Balance Sheet of your Company.

The aforesaid documents in respect of the respective subsidiary companies will be made available upon a request made by any Shareholder of the Company interested in obtaining the same. These documents in respect of aforesaid subsidiary companies are also available for inspection at the registered office of the Company and that of the respective subsidiaries. However, as directed by MCA, the financial data of subsidiaries has been furnished under 'Financial Information on Subsidiary Companies' forming part of the Annual Report.

The Audited Consolidated Financial Statements made in accordance to the applicable Accounting Standards forms part of this Annual Report.

RBI REGULATIONS

Your Company is a Non-Deposit Accepting or Holding Systemically Important Non-Banking Finance Company ("SI-ND- NBFC") and is in compliance to the applicable regulations prescribed by the Reserve Bank of India ("RBI"). On an application made by the Company, RBI has granted provisional exemption to the Company from compliance to thresholds prescribed under Para 18 of the Prudential Norms in respect of concentration of credit/investment norms.

Your Company has complied with the regulations of RBI as on 31st March, 2011 as are applicable to it as a SI-ND-NBFC.

PUBLIC DEPOSITS

Your Company has not accepted any deposits from the public during the year under review and shall not accept any deposits without obtaining prior approval of the Reserve Bank of India.

DIRECTORS

Mr. Jagdish Shenoy and Mr. Gaurav Burman have been appointed as Additional Directors of the Company with effect from 10th August, 2010 and 16th July, 2011 respectively. In accordance to the provisions of Section 260 of the Companies Act,1956, the Additional Directors so appointed shall hold office only upto the date of the ensuing Annual General Meeting. Individual notices proposing candidature for office of aforesaid Directors have been received from Shareholders of the Company in accordance with the provisions of the Section 257 of the Companies Act, 1956.

During the year, Mr. Rakesh Jhunjhunwala has resigned from the Board of Directors of the Company with effect from 4th August, 2010.

In terms of the provisions of the Companies Act, 1956, Mr. Anil Harish retires from the Board of Directors of the Company by rotation and being eligible, has offered himself for re-appointment at the ensuing Annual General Meeting.

None of the Directors are disqualifi ed for appointment / re-appointment under Section 274(1)(g) of the Companies Act,1956.

The Notice convening the ensuing Annual General Meeting includes the proposals for appointment / re-appointment of aforesaid Directors. A brief resume of the Directors seeking appointment / re-appointment at the ensuing Annual General Meeting and other details as required to be disclosed in terms of Clause 49 of the Listing Agreement forms part of the Notice of the ensuing Annual General Meeting. None of the Directors are related inter-se to each other.

CORPORATE GOVERNANCE

Report on Corporate Governance together with Auditors' Certificate as required under Clause 49 of the Listing Agreement forms part of this Annual Report.

MANAGEMENT DISCUSSION & ANALYSIS REPORT

The Management Discussion & Analysis Report as required under Clause 49 of the Listing Agreement is presented separately and forms part of this Report.

CONSOLIDATED FINANCIAL

STATEMENTS

Pursuant to the provisions of Clause 41 of the Listing Agreement and that of the Accounting Standard AS-21 on Consolidated Financial Statements read

with Accounting Standard AS-23 on Accounting for Investment in Associates and Accounting Standard AS-27 on Financial Reporting of Interest in Joint Ventures, the Audited Consolidated Financial Statements have been prepared on the basis of audited financial statements received from the subsidiary companies and the joint ventures, as approved by their respective Board of Directors.

AUDITORS

M/s. Deloitte Haskins & Sells, Chartered Accountants, the Statutory Auditors of the Company hold office until conclusion of the ensuing Annual General Meeting. The Statutory Auditors have expressed their willingness to continue if so appointed, and have issued a Certificate to the Company as required under Section 224 (1B) of the Companies Act, 1956, to the effect that their re-appointment, if made, would be in conformity with the limits specifi ed in the said section.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 217 (2AA) of the Companies Act, 1956, with respect to Directors' Responsibility Statement it is hereby confi rmed:

1. that in the preparation of the annual accounts for the financial year ended 31st March, 2011, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

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

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

4. that the Directors have prepared the annual accounts for the fi nancial year ended 31st March, 2011, on a going concern basis.

PARTICULARS OF EMPLOYEES AND

EMPLOYEE STOCK OPTION PLAN-

2011

In accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, the name and other particulars of certain employees are required to be set out in an Annexure to the Directors' Report. However, as per the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956, the Directors' Report excluding the aforesaid information is being sent to all the Shareholders of the Company and other entitled thereto. Shareholders who are interested in obtaining such particulars may write to the Company at its Registered office.

Pursuant to the approval granted by the Shareholders at the 14th Annual General Meeting held on 10th August, 2010, your Company has implemented 'FVIL Employees Stock Option Plan-2011' and has granted Options in terms thereof. The disclosure as required under the Securities and Exchange Board of India (Employee Stock Option Scheme & Employee Stock Purchase Scheme) Guidelines, 1999 are annexed and forms part of this Report (Annexure 1).

GROUP

Pursuant to an intimation received from the Promoter(s) and in accordance with regulation 3(1) (e) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 regarding identifi cation of persons constituting 'Group' (within the meaning as defined in the Monopolies and Restrictive Trade Practices Act,1969) are disclosed in this Report as separate disclosure. (Annexure 2).

PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, EXPENDITURE ON RESEARCH AND DEVELOPMENT, FOREIGN EXCHANGE INFLOW/ OUTFLOW, ETC

The requirement for disclosure in respect of Conservation of Energy, in terms of Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is not applicable to the Company. However the Company takes all possible efforts towards energy conservation.

The requirement of disclosure with regard to technology absorption does not apply to the Company as the activities in which the Company operates does not require any technology.

The details in respect of Foreign Exchange outgo during the year under review, is provided in Note II(8) in Notes to Accounts under Schedule 10 forming part of the Balance Sheet and profit and Loss Account.

ACKNOWLEDGEMENT

Your Directors would like to thank and place on record their appreciation for the support and co-operation provided to your Company by its Shareholders, Future Group entities, and in particular, their employees, regulatory authorities and its bankers. Your Directors would also like to place on record their appreciation for the efforts put in by employees of the Company during the year.

On behalf of the Board of Directors

Sd/-

G.N.Bajpai

Chairman Date: 16th July, 2011

Place: Mumbai

 
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