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Directors Report of NIIT Ltd.

Mar 31, 2015

Dear Members,

The Directors take pleasure in presenting the 32nd Annual Report along with the audited financial statements for the financial year ended March 31, 2015.

Financial Highlights

The highlights of your Company's financial results for the financial year April 1, 2014 to March 31, 2015 are as follows:

(Rs. Mn.

Particulars NIIT Limited-Group NIIT Limited (Consolidated) (Standalone)

2014-15 2013-14 2014-15 2013-14

Net Sales (Income from 9,574 9,510 3,486 5,202 operations)

Other Income 131 102 369 615

Total Income 9,705 9,612 3,855 5,817

Total Expenditure 9,488 9,164 3,703 5,175

Profit before depreciation 217 448 152 642 and taxes

Depredation and 1,073 779 431 680 Amortization

Exceptional Items (Net) (803) 67 (848) 19

Net tax provision 12 93 34 59

Net profit/ (loss) before (1,671) (357) (1,161) (78) share of Associates' Profit & Minority Interest

Share of Associates' Profit 286 534 - - and Minority Interest

Net Profit/(Loss) (1,385) 178 (1 161) (78)

Basic EPS (Rs.) (839) 108 (703) (047)

Diluted EPS (Rs.) (839) 108 (703) (047)

During the year, your Company's consolidated income from operations was Rs. 9,574 million as against Rs. 9,510 million in the previous year and Net loss (after Associates' Profit) Rs. 1,385 million as against profit of Rs. 178 million in the previous year.

The income from operations for the year under review for the Company on a stand-alone basis was Rs. 3,486 million as compared to Rs. 5,202 million in the previous year and Net loss of Rs. 1,161 million as against the loss of Rs. 78 million in the previous year.

Business Operations

During the year under review, the Company undertook a major program for business transformation including rationalization of subsidiary companies structure and the direction being to make NIIT an asset light & technology intensive IP driven company. The business transformation exercise also included:

* Succession for top management and appointment of new CEO

* Defocus/Exitfrom certain international geographies to conserve management bandwidth

* Capacity and people consolidation and Product portfolio rationalization

In the Corporate Learning business, your Company continues to focus on Managed Training Services (MTS). Revenue from Corporate Learning Group (CLG) grew 23%, driven by strong momentum in MTS which was up 35% as compared to the previous year. NIIT added 4 new global MTS customers in FY'15. As on March 31,2015 the company had 24 MTS customers, with a revenue visibility of USD 179 million over the balance period of existing contracts. The business achieved EBITDA margins of 12%. CLG contributed 51% to the total consolidated revenue of NIIT.

Given the challenging environment, the Company took a decision to launch a comprehensive business transformation program which involved a review of entire portfolio of businesses, geographies and products with the objective of exiting low margin and low volume products, capital intensive businesses and sharpen focus on asset-light, high-return and growth- oriented offerings. Individual Learning business and Skill Building business operations have been combined into a single Skills & Careers business (SNC) and rationalized capacity and organization structure. The Company utilized the relatively weaker quarters of Oct-Dec and Jan-Mar to drive this transformation. While the exercise involved one-time expenses and provisions and impacted normal business during these two quarters, it has led to a material reduction in continuing costs and also enabled the organization to expand the reach of its Beyond-IT programs which have now been made available to the entire network of training centers.

In the last couple of years, NIIT's Skills & Careers business had been impacted due to continuing weakness in hiring by IT sector. The Company had responded to the headwinds in the business by focusing on growing its Beyond-IT portfolio of offerings. The contribution from Beyond-IT increased to 33% in FY'15 as compared to 26% last year. During the year, revenue achieved by the Skills & Careers business declined 18% year on year. The business had a negative 5% percent EBITDA margin due to adverse impact of operating leverage. Skills & Careers business contributed 34% to NIIT's consolidated revenue.

In the Schools Learning business, the Company stayed away from adding on business from the government schools sector and from accepting new orders of capital intensive and capex driven business models. While this impacted overall revenue and margins, the Company continues to improve its liquidity and capital efficiency. The focus for the Schools Learning Group (SLG) is on growing the asset light, IP driven product offerings. In FY'15, revenue from SLG declined 9% year on year. The business had 4% EBITDA margins for the year. The business contributed 15% to NIIT's revenues for FY'15.

During the year, NIIT Limited transferred the Schools business to a wholly owned subsidiary i.e. Hole-In-The- Wall Education Limited (now known as Mindchampion Learning Systems Limited). This has been done to enable options for funding, partnerships and alliances to address the large opportunity in the schools market. On an overall basis, NIIT achieved revenues of Rs. 9,574 million, a growth of 1% as compared the previous financial year. The strong growth in Corporate Learning helped to overcome decline in IT training and planned ramp down of revenue from Government schools Capital Intensive business. EBITDA, excluding one-time expenditure related to the business transformation, was Rs 442 million as compared to Rs. 620 million last year.

Future Plans

Going forward, the Company expects CLG to continue to see a robust growth driven by MTS as global companies are increasing to outsource training to specialist training providers.

In Skills and Careers business, softness in hiring of IT graduates is expected to continue in the short term and would impact enrolments. However, increasing pace of technology transformation and disruption of traditional industries by start-ups is driving demand for niche skills across sectors. NIIT has reorganized its operations in India to drive closer integration with demand across various industries and this is expected to help the business achieve a turnaround in performance.

NIIT would continue to focus on the asset light, IP driven business in Private schools and exit capital intensive business models. The Company believes that there is a large opportunity in the K-12 market. To address this opportunity, the Schools Learning business has been transferred into a wholly owned subsidiary. This enables

NIIT to explore various options for funding, partnerships and alliances to accelerate growth for the business.

Dividend

Your Directors have not recommended any dividend for the year under review.

Transfer to Reserves

Your Company has not transferred any sum to the General Reserve.

Awards and Accolades

During the year, the NIIT Brand received accolades from across the world recognizing and commending various aspects of the Company. Some of them are listed below:

* NIIT received the "Top Training Company Award 2014" for the 20th consecutive year by Cybermedia publications

* NIIT has been featured as "India's Most Trusted Training Brand" in Brand Trust Report, India Study, 201 5, undertaken by Trust Research Advisory for the third consecutive year

* NIIT nGuru MathLab Plus has been recognized as the "Best Innovative Learning Tool" at the 5th Indian Education Awards 2015 by Franchise India

* NIIT US has been featured in the 2015 "Top 20 Training Outsourcing Companies" for the eighth consecutive year by Training Industry, Inc.

* NIIT's corporate website www.niit.com has been recognized as the "Best Educational Website" at the 5th Annual India Digital Awards by Internet and Mobile Association of India (IAMAI) in 2014

* NIIT Yuva Jyoti Ltd has been recognized as the "Best Vocational Education and Skill Development initiative" at the World Education Summit, 2014

* NIIT US has been honored with "Brandon Hall Excellence Gold Award" in the Best Custom Content category jointly with Shell for Shell Services on the Road

* NIIT's Chiphen Rigpel Bhutan project has been recognized as the "Best Government Sector Initiative" in Education at the World Education Summit, 2014

* NIIT Corporate Learning has been ranked among "Top 20 Gamification L&D companies" of 2014 by Training Industry, Inc.

* NIIT Institute of Finance Banking & Insurance Training Ltd (IFBI) has been recognized as the

"Best Vocational Institute for Banking, Finance & Insurance" at the 5th Indian Education Awards 2015 by Franchise India.

Scheme of Arrangement

Subsequent to year end, a composite Scheme of Arrangement (the Scheme) under the provisions of Section 391 and 394 of the Companies Act, 1956 between NIIT Limited (the Company), Evolv Services Limited, Scantech Evaluation Services Limited, NIIT Online Learning Limited and Hole-In-The-Wall Education Limited and their respective shareholders and creditors was approved by Hon'ble Delhi High Court vide its order pronounced on May 8, 2015. The Scheme became effective from May 23, 2015 on filing a certified copy of the High Court order with the office of the Registrar of the Companies, NCT of Delhi & Haryana, and is applicable from April 1,2014 (the "Appointed Date"). On Scheme becoming effective, the School Business Undertaking stands transferred to and vested in the wholly owned subsidiary of the Company namely Hole-In-The-Wall Education Limited (the name of the Company has been changed to Mindchampion Learning Systems Limited).

Further, Evolv Services Limited, Scantech Evaluation Services Limited, NIIT Online Learning Limited, wholly owned subsidiaries of the Company stand merged with the Company pursuant to the Scheme.

Changes in Capital Structure

Pursuant to the Scheme of Arrangement, the Authorised share capital of the Company was increased to Rs. 1,38,60,00,000/- comprising of 15,00,00,000 Equity Shares of Rs. 1/- each, 25,00,00,000 Equity Shares of Rs. 2/- each, 1,36,00,000 Equity Shares of Rs. 10/- each, 35,00,00,000 8.5% Cumulative Redeemable Preference shares of Rs. 1 /- each and 25,00,000 Redeemable Preference Shares of Rs. 100/- each.

During the year under review, the Company has allotted 25,000 Equity Shares under the NIIT Employee Stock Option Scheme 2005.

Subsidiary Companies

A report on the performance and financial position of each of the subsidiaries, associates and joint venture companies as per the Companies Act, 2013 is provided as Annexure-A in the prescribed Form AOC-1.

The annual accounts of the subsidiaries, will be made available to the Members of the Company/subsidiary Companies seeking such information at any point of time. The annual accounts of the subsidiaries are also available for inspection for any Member, during the business hours, at the Registered Office of the Company and subsidiary companies and the same can be accessed from the website of the Company i.e. www.niit.com.

Consolidated Financial Statements

In compliance with Clause 32 of the Listing Agreement and Section 129(3) of the Companies Act, 2013 read with the relevant rules made thereunder, the Consolidated Financial Statements are prepared in accordance with the Accounting Standard (AS) - 21 on Consolidated Financial Statements read with AS - 23 on Accounting for Investments in Associates and AS - 27 on Financial Reporting of Interests in Joint Ventures, the audited Consolidated Financial Statement is provided in the Annual Report. The Consolidated Financial Statements together with Auditors' Report thereon form part of the Annual Report.

Transfer of Amounts to Investor Education and Protection Fund

Pursuant to the provisions of Section 205A(5) and 205C of the Companies Act, 1956, relevant amounts which remained unpaid or unclaimed for a period of seven years have been transferred by the Company, from time to time on due dates, to the Investor Education and Protection Fund.

Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on July 7, 2014 (date of last Annual General Meeting) on the website of the Company http://www.niit.com/india/training/investors/Pages/ investor-information.aspx

Corporate Social Responsibility (CSR)

In compliance with the requirement of Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility) Rules, 2014, as amended from time to time, the Company has constituted a Corporate Social Responsibility Committee ('CSR Committee'). As on the date of this report, following are the members of CSR Committee:

- Mr. Surendra Singh - Chairman

- Mr. Rajendra S. Pawar

- Mr. Vijay K Thadani

- Mr. Anand Sudarshan

During the year under review, the Company has undertaken activities as per the CSR Policy approved by the Board of Directors of the Company on recommendation of the CSR Committee. The same is available on the Company's website at http://www. niit.com/authoring/Documents/Other%20Disclosures/ CORPORATE%20SOCIAL%20RESPONSIBILITY%20 POLICY.pdf.

Pursuant to the CSR Policy, the Company's CSR initiatives are directed towards promoting both higher and vocational education, thus enhancing employability and creating livelihoods. The Company has made a grant of Rs. 10.97 million during the financial year 2014-15 to NIIT Institute of Information Technology ("TNI"), a society registered under the Societies Act, 1860 which has set up NIIT University ("NU") as a private university at Neemrana, Dist. Alwar, Rajasthan. The annual report on CSR Activities is given in Annexure - B forming part of this Report.

Corporate Governance

Your Company's philosophy on Corporate Governance envisages the highest level of transparency, accountability and equity in all facets of its operations as well as in all interactions with its Stakeholders including Shareholders, NIITians, Lenders and Regulatory Authorities. Your Company has also implemented several best practices in Corporate Governance, such as the "Whistleblower Policy" and "Code of Conduct on Ethics".

Your Company has complied with all the requirements relating to Corporate Governance as stipulated in Clause 49 of the Listing Agreement. The report of the Directors on corporate governance is given as a separate section titled "Report on Corporate Governance". The Certificate from the Practicing Company Secretary confirming the compliance to the conditions of the corporate governance stipulated in Clause 49 of the Listing Agreement is annexed to the Report on Corporate Governance.

Management Discussion and Analysis Report As required by Clause 49 of the Listing Agreement, the Management Discussion and Analysis Report is annexed and forms part of this Report.

Directors

During the year under review, Ms. Madhabi Puri Buch resigned from the Directorship of the Company w.e.f closing business hours of July 10, 2014. The Board of Directors placed on record their deep appreciation for the invaluable contribution and guidance extended by her during her tenure as Director of the Company.

As per the provisions of Section 152(6) of the Companies Act, 2013, Mr. P Rajendran will retire in the ensuing Annual General Meeting and being eligible has offered himself for re-appointment.

The Company has received declarations from all the independent directors confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

Further, in accordance with the succession planning process of the Company following changes have been effected in the roles of the Directors of the Company, with effect from April 1, 2015, of the Company:

- Mr. Rajendra S Pawar has vacated the position of 'Managing Director' of the Company and continues as the Chairman of the Board.

- Mr. Vijay K Thadani has been designated as Vice Chairman and Managing Director.

- Mr. P Rajendran has been designated as Joint Managing Director.

Key Managerial Personnel

As on date of this report, following officials of the Company are the 'Key Managerial Personnel' of the Company under the Companies Act, 2013:

1. Mr. Vijay K Thadani - Vice-Chairman & Managing Director

2. Mr. P. Rajendran- Joint Managing Director

3. Mr. Rahul K Patwardhan - Chief Executive Officer

4. Mr. Rohit Kumar Gupta - Chief Financial Officer

5. Mr. Mukesh Kumar - Company Secretary (appointed w.e.f. February 2, 2015)

During the intervening period between the date of last report and this report, Mr. Rajendra S Pawar has ceased to be the Managing Director of the Company w.e.f April 1, 2015. Further, Mr. Rajesh Arora has resigned as Company Secretary of the Company w.e.f the close of businesshours on January 31, 2015. Mr. Ashok Kumar Arora who was designated by the Board of Directors, as Whole-time 'Key Managerial Personnel' of the Company w.e.f. April 1,2014, ceased to be Key Managerial Personnel w.e.f. the close of business hours on September 30, 2014, upon change of his designation from Group Chief Financial Officer to Group Chief Financial Advisor.

Appointment of Chief Executive Officer

The Board of Directors in their meeting held on October 6, 2014 appointed Mr.Rahul K Patwardhan as CEO Designate of the Company and he continued to hold this position till the closing business hours of May 27, 2015. Further, he was appointed as Chief Executive Officer of the Company w.e.f. May 28, 2015. Mr.Patwardhan is a Production Engineer and an MBA from IIM Calcutta. After having spent the first 20 years of his career with NIIT in diverse roles, he returned to the Company with 1 0 years of extensive global experience in scaling Managed Services operations. Mr. Patwardhan was based at the Europe headquarters of Logica as MD, Global Managed App Services.

Meetings of the Board

During the year ten Board Meetings were convened and held. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and Clause 49 of the Listing Agreement. For further details, please refer report on Corporate Governance forming part of this Annual Report.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Audit, Nomination and Remuneration, CSR and Stakeholders Relationship Committees. A structured evaluation form was administered after taking into consideration inputs received from the Directors, covering various aspects of the Board's functioning such as adequacy of the composition of the Board and its Committees, Board Effectiveness, Key Stakeholders connect, Ethics and Compliances, Evaluation of Company's Performance, Project Management and Internal Control and Audits. A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution,effective participation in Board/ Committee Meetings, independence of judgement, safeguarding the interest of the Company and its minority shareholders, providing expert advice to Board and contributing in deliberations while approving related party transactions.

Remuneration Policy

The Board has, on the recommendation of the Nomination & Remuneration Committee framed the Nomination and Remuneration Policy as stated in the Corporate Governance Report.

Vigil Mechanism/ Whistle Blower Policy

Pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013 and Clause 49 of the Listing Agreement, a Vigil Mechanism for Directors and employees to report genuine concerns has been established by the Company. The Whistle Blower Policy is available on the website of the Company at the following link:

http://www.niit.com/authoring/Documents/Other%20 Disclosures/Whistle%20Blower%20Policy.pdf

Directors' Responsibility Statement

As required under section 134(3)(c) of the Companies Act, 2013, the Board of Directors of your Company hereby state and confirm:

a) That in the preparation of the annual accounts, the applicable accounting standards were followed along with proper explanation relating to material departures;

b) That the directors had selected such accounting policies and applied them consistently (including as required to give effect to the Court approved composite Scheme of Arrangement) 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 of the loss of the Company for that period;

c) That the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d) That the directors had prepared the annual accounts on a going concern basis;

e) That the directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f) That 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.

Information relating to Conservation of Energy, Technology Absorption, Research and Development, Exports, Foreign exchange earnings and Outgo and other information forming part of the Directors' Report in terms of Section 134(3)(m) of the Companies Act, 2013, and the Rules made thereunder

a) Conservation of energy

Although the operations of the Company are not energy intensive, the management has been highly conscious of the criticality of conservation of energy at all the operational levels and efforts are made in this direction on a continuous basis. Adequate measures have been taken to reduce energy consumption whenever possible by using energy efficient equipment. The requirement of disclosure of particulars with respect to conservation of energy as prescribed in Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, are not applicable to the Company and hence are not provided.

b) Technology absorption

Your Company believes that in addition to progressive thought, it is imperative to invest in research and development to ascertain future exposure and prepare for challenges. In its endeavor to obtain and deliver the best, your Company has entered into alliances / tie-ups with major global players in the Information Technology industry to harness and tap the latest and the best of technology in its field, upgrade itself in line with the latest technology in the world and deploy / absorb technology wherever feasible, relevant and appropriate.

c) Research and Development

The Company believes that technological obsolescence is a reality. Only progressive research and development will help us to measure up to future challenges and opportunities. We invest in and encourage continuous innovation. During the year under review, expenditure on research and development is not significant in relation to the nature and size of operations of your Company.

d) Foreign exchange earnings and outgo

i) Activities relating to exports, initiatives taken to increase exports, development of new export markets for products and services and export plans

The Company exports customized learning content to its overseas clients to meet their varying learning needs. The Company develops content in a range of subjects for widely varied audience. The Company will continue to strengthen its presence in USA, Europe, China, Africa, South East Asia, Maldives etc. with a view to increase exports.

ii) Total foreign exchange earned and used

The details of foreign exchange earnings and outgo are mentioned in Notes Nos.32 to 35 contained in the Notes to Accounts forming part of the Balance Sheet and Statement of Profit and Loss for the financial year ended March 31,2015.

Auditors and Auditors' Report

M/s Price Waterhouse, Chartered Accountants (Firm Registration Number FRN301112E) were appointed as Statutory Auditors of the Company at the 31st Annual General Meeting of the Company to hold office from the conclusion of the Annual General Meeting held in the year 2014 till the conclusion of the Annual General Meeting scheduled to be held in the year 2017 subject to ratification by members at every consequent Annual General Meeting. Therefore, ratification of appointment of Statutory Auditors is being sought from the members of the Company at the ensuing AGM.

The Auditors in their report to the members on the financial statements of the Company (both standalone and consolidated) for the financial year ended on March 31,2015 have stated a "Matter of emphasis". The notes on Financial Statements referred to in the Auditors' Report are self-explanatory and do not require any further comments.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Nesar & Associates, Company Secretaries to conduct Secretarial Audit for the Company for the financial year 2014-15. The Secretarial Audit Report is annexed herewith as Annexure-C. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

Cost Auditors

In terms of Section 148 of the Companies Act, 2013 read with Companies (Cost records and audits) Rules, 2014, the Board of Directors of the Company, upon recommendation of the Aud it Committee, have appointed M/s. Ramanath Iyer and Co., Cost Accountants, New Delhi as the Cost Auditors of the Company, to carry out the cost audit for the financial year 2014-15. The ratification of remuneration payable to Cost Auditors is being sought from the members of the Company at the ensuing AGM.

Extract of Annual Return

The details forming part of the extract of the Annual Return in form MGT-9 in term of Section 92(3) of the Companies Act, 2013 is annexed herewith as Annexure-D.

Related Party Transactions

All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a Related Party Transactions Policy for identifying, reviewing and approving transactions between the Company and Related Parties, in compliance with the applicable provisions of the Companies Act 2013, the Rules thereunder and the Listing Agreement. The said Policy is available on the website of the Company at http://www.niit.com/authoring/Documents/Other%20 Disclosures/Related%20Party%20Transactions%20 Policy final.pdf.

All Related Party Transactions are placed before the Audit Committee and also before the Board for approval. The details of contracts or arrangements with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 in form AOC-2 is annexed herewith as Annexure-E.

Particulars of Loans, Guarantees or Investments

Details of Loans, Guarantees or Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

Particulars of Employees

The table containing the names and other particulars of employees in accordance with the provisions of Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is appended as Annexure-F(a) to the Board's report.

A statement containing the names of every employee employed throughout the financial year and in receipt of remuneration of Rs. 60 lakh or more, or employed for part of the year and in receipt of Rs. 5 lakh or more a month, under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is enclosed as Annexure-F(b) to the Board's report.

Public Deposits

In terms of the provisions of Section 73 to 76 of the Companies Act, 2013 read with the relevant rules made thereunder, your Company has not accepted any fixed deposits from public.

Detail of significant and material orders passed by the regulators, courts, tribunals

During the year under review, no significant or material orders were passed by the Regulators or Courts or Tribunals impacting the going concern status and Company's operations in future.

Human Resources and Employee Stock Option Scheme

NIITians are the key resource for your Company. Your Company has been able to create and continuously improve a favourable work environment that encourages innovation and meritocracy at all levels.

Employee relations remained cordial at all the Company's locations. The Directors take this opportunity to record their appreciation for the outstanding contribution of all NIITians.

During the financial year 2005-06, your Company had set up NIIT Employee Stock Option Plan 2005 (ESOP-2005) with the objective of attracting and motivating employees by rewarding performance and retaining the best talent. The aim is to develop a sense of ownership among the employees within the organization and to align your Company's stock option scheme with the best practices in the Industry. In accordance with the applicable provisions ofthe Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, the particulars of the options granted,vested, exercised and allotted under the ESOP-2005 are appended as Annexure-G and form part of this report.

The Nomination and Remuneration Committee has granted 14,90,000 Employee Stock Options (Grant #9) at Rs.35.40 per option/share, 3,70,000 Employee Stock Options (Grant #10) at Rs.49.75 per option/ share and 10,00,000 Employee Stock Options (Grant #11) at Rs.48.50 per option/share to the eligible employees under ESOP-2005 in May 2014, September 2014 and October 2014 respectively.

Further, none of the employees was granted options equal to or exceeding 1% of the issued capital of the Company.

Acknowledgement

Your Directors take this opportunity to thank all investors, clients, licensees, technology partners, vendors, financial institutions, banks, regulatory and governmental authorities, media and stock exchanges for their continued support during the year under review. We place on record our appreciation of the contribution made by our employees at all levels.

For and on behalf of the Board

Rajendra S Pawar Place: New Delhi Chairman Date: July 17, 2015 DIN: 00042516


Mar 31, 2012

The Directors take pleasure in presenting the 29th Annual Report along with the audited statement of accounts for the financial year ended March 31, 2012.

Financial Highlights

The highlights of your Company's financial results for the financial year April 1, 2011 to March 31, 2012 are as follows:

(Rs. Mn.)

Particulars NIIT Limited-Group NIIT Limited (Consolidated) (Stand alone)

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

Net Sales (Income from 12,603 12,483 7,381 6,480 operations)

Other Income 76 84 462 294

Total Income 12,678 12,566 7,843 6,744

Total Expenditure 11,411 11,297 6,873 5,780

Profit before depreciation 1,267 1,269 971 994 and taxes

Depreciation and 874 854 684 577 Amortisation

Exceptional Items (Net) 1,636 142 856 136

Net tax provision 1,408 89 181 56

Net profit before share 621 469 963 497 of Associates' Profit & Minority Interest

Share of Associates' Profit 481 453 and Minority Interest

Net Profit 1,102 922 963 497

Basic EPS (Rs.) 6.67 5.58 5.83 3.01

Diluted EPS (Rs.) 6.67 5.58 5.83 3.01

During the year, your Company's consolidated income from operations has increased to Rs. 12,603 million as against Rs. 12,483 million in the previous year, Net Profit (after Associates' Profit) is Rs. 1,102 million as against Rs. 922 million in the previous year, registering a growth of 19.5% over the previous year.

The income from operations for the year under review for the Company on a stand alone basis increased to Rs. 7,381 million as compared to Rs. 6,480 million in the previous year, thereby registering a growth of 14 % on yearly basis and Net Profit increased to Rs. 963 million as against Rs. 497 million in the previous year.

Business Operations

In the financial year 2011-12, the Global Economy faced fresh challenges with several of the major economies battling with issues of growth and solvency. The Indian economy witnessed a year of slower growth, high inflation and strong forex volatility, the situation exacerbated by slow pace of decision making by Government. In this environment, your Company focused on improving the return on capital employed and quality of balance sheet while re-engineering the Company's businesses for higher growth.

During the year under review, the Individual Learning Solutions offerings included IT, BFSI, Management, BPO and English & Professional life skills. For this, your Company leverages its global presence across India, China and other developing countries for reaching out to the students as well its partnership with large technology companies in USA and Europe to provide the requisite solutions.

In the School Learning Solutions business, your Company provided solutions and services for IT training and technology enabled learning & teaching for schools, teachers' training and learning for underserved children. The Company offered NIIT nGuru solution comprising of 'Interactive Classrooms' for teachers, 'Math lab' and 'IT Wizard' for students and 'Quick School' an Education Resource Planning solution for school management.

In the Corporate Learning Solutions business, your Company focused on the managed training services business and achieved traction in the same with three new contracts with a total revenue visibility of USD 120 million. This growth was backed by aggressive sales and engagement management teams with robust delivery performance.

Your Company entered into a strategic partnership with the National Skill Development Corporation to form the NIIT Yuva Jyoti Limited (NYJL). This subsidiary Company was incorporated to engage in the business of skill development, thus converting unemployed youth into employable professionals in various sectors. NYJL started out with strong focus on Service Sectors like Retail (Both traditional retail and Auto Sales), Hospitality (F&B) and ITeS (BPO), offering both career specific and career foundation specific courses.

During the year under review, your Company divested its stake in its step down subsidiary, Element K Corporation, based in Rochester, NY, USA, by selling the Element K business to Skill Soft Corporation and SkillSoft Ireland Limited, indirect subsidiaries of SSI Investments II Limited which is the parent company of SkillSoft Limited (formerly SkillSoft PLC), for a consideration of USD 110 million in cash, subject to closing adjustments. The company has utilized a large part of the consideration to reduce its debt levels and become net cash positive. The company repaid all its debt excluding the debentures and lease obligations. The balance sheet has become much lighter, in line with the members' expectations.

Future Plans

Your Company is well diversified, both in terms of its service offerings and geographic spread. The judicious mix of revenue from the different business lines i.e. Individual, Schools and Corporates ensures that your Company is well positioned to manage any down turn or slowdowns in a particular product category or in a specific geography.

The Company will remain focused on its four platforms of growth i.e. 1) Individual: Cloud Campus, 2) Schools: nGuru, 3) Corporate: Managed Training Services and 4) Skills: Yuva Jyoti.

Your Company's core competencies of Pedagogy, Technology and Partnerships, acquired over its 3 decades of existence, will remain foundational to its future growth.

Your Company future plan includes 'NIIT One World' Centers -integrating IT, ITeS, Finance and Management Offerings, focus on select countries in Africa and more number of large education centres in PPP mode in China, innovative use of technology to reduce delivery costs, improvement of productivity through innovation and maintaining first to market position with innovative solutions.

Dividend

In view of the Company's profitable performance, your Directors are pleased to recommend, for approval of the Members at the ensuing Annual General Meeting, a dividend of Rs. 1.60 per equity share of Rs. 2 each.

Transfer to Reserves

In accordance with the statutory provisions, your Company has transferred a sum of Rs. 96 million to the General Reserve.

Awards and Accreditation

NIIT brand received accolades during the year when

- NIIT was voted for being the second most trusted education brand in India by Brand Equity- Nielsen Survey 2011.

- NIIT featured as the'Most Trusted Leader in Education' in Brand Trust Report, India Study, 2012, undertaken by Trust Research Advisory.

- NIIT featured in Aon Hewitt's Top 25 list of 'Best Employers in India-2011'.

Moreover, during the year, the Company received the following recognitions:

- NIIT received 'Top IT Training Company Award 2011' for the 19th year in succession by Cyber media publications.

- NIIT received the 'Best Education Company to Work with' title at the Indian Education Awards 2011.

- NIIT received three accolades at the World Education Awards, 2011. NIIT's Skill development project in the Republic of South Africa was felicitated with, 'Best Vocational and Skills Initiative of the year' award; NIIT Imperia was recognized as 'Best Training to Working Professionals' and NIIT's Mobile Science Lab was acknowledged as the 'Best Innovation in Science Education'.

- NIIT Vietnam received the ICT Gold Medal Award

2011 for the 6th Consecutive Year from the Ho Chi Minh Computer Association.

- NIIT USA earned fifth consecutive appearance amongst Top 20 Companies in the Training Outsourcing Industry rankings.

- NIIT Foundation was adjudged as the 'Best Private Sector Skills Provider' at UK India Skills Forum (UKISF) Awards 2011.

- NIIT was adjudged as the 'Best Result Oriented ICT School' in Ghana for the second consecutive year.

- NIIT USA received the Gold at the Chief Learning Officer (CLO) magazine's annual "Chief Learning Officer Learning In Practice" Awards.

- NIIT USA was honoured with the 3 Brandon Hall 'Excellence Awards' for Performance Support, Learning, and Marketing.

- NIIT USA was honoured by Seventh Annual Human Resource Outsourcing Association (HROA) for its partnership with Diageo.

- NIIT NGuru received Manthan Award in the Chairman's distinction category for e-education and learning.

- NIIT received 'Franchisor of the Year: IT' Award by Franchise Plus, India's leading business opportunity magazine.

- NIIT's association with Grandmaster Viswanathan Anand was recognized as the Top brand ambassador engagement at the Indian PR and Corporate Communication Awards (IPRCCA) 2011, instituted by Exchange4Media.

- NIIT HIWEL received the prestigious Mac Arthur

Digital Media and Learning Award. (This was an effort by MacArthur Foundation and HASTAC to find and inspire the most novel uses of new media in support of learning, NIIT HiWEL was awarded for innovative use of internet and digital technology to transform learning and knowledge creation).

- NIIT received Microsoft's "Learning Solutions Partner of the Year" Award for the third consecutive year. (This award marked a Hat-Trick by NIIT for being the "Best Learning Solutions Partner" in India).

- NIIT USA achieved top ranking in Training Magazine's Top 125 List of best Employee Development Organization, for the fourth consecutive year.

- NIIT USA was ranked among Top 20 Companies in the Training Outsourcing Industry - 2011 and 2012. (NIIT is being featured in this ranking since 2008).

Subsidiary Companies

During the year under review, your Company has disinvested its entire stake in step-down subsidiary company 'Element K Corporation, USA'. Further, your Company has incorporated a new subsidiary by the name of 'NIIT Yuva Jyoti Limited', which has entered into strategic partnership with the National Skill Development Corporation to enhance skills and employability for youth across India.

As per the provisions of Section 212 of the Companies Act, 1956 ('the Act'), your Company is required to attach the Directors' Report, Auditors' Report, Balance Sheet, Statement of Profit and Loss and other information of the subsidiary companies to its Balance Sheet. However, the Ministry of Corporate Affairs vide its General Circular No. 2/2011 dated February 8, 2011, has granted a general exemption under Section 212(8) of the Act to all the companies from annexing the annual accounts and other documents/statements of subsidiary companies with the Annual Report of the holding company subject to certain conditions. As the Company complies with all the specified conditions of the abovementioned Circular, it is not required to attach the audited accounts and other documents of the subsidiary companies to the Annual Report of your Company for the financial year 2011-12.

A statement of the Company's interest in the subsidiaries and a summary of the financials of the subsidiaries are given along with the consolidated accounts. The annual accounts of the subsidiaries, along with the related information, will be made available to the Members of the Company/subsidiary Companies seeking such information at any point of time. The annual accounts of the subsidiaries are also available for inspection for any Member/Investor, during the business hours, at the Registered Office of the Company and subsidiary Companies and the same can be accessed from the website of the Company www.niit.com.

Consolidated Financial Statements

In compliance with Clause 32 of the Listing Agreement, the consolidated financial statements are prepared in accordance with the Accounting Standards notified under Section 211 (3C) of the Act read with the Companies (Accounting Standards) Rules, 2006. The consolidated financial statements together with Auditors' Report thereon form part of the Annual Report.

Corporate Governance

Your Company's philosophy on Corporate Governance envisages the attainment of the highest levels of transparency, accountability and equity in all facets of its operations as well as in all interactions with its Stakeholders including Shareholders, NIITians, Lenders and Regulatory Authorities. In order to enhance customer satisfaction and stakeholder's value, your Company continues to benchmark its Corporate Governance practices with the best in the world in line with international norms.

Your Company has complied with all the requirements relating to Corporate Governance as stipulated in Clause 49 of the Listing Agreement. The report of the Directors on Corporate Governance is given as a separate section titled 'Corporate Governance Report', which forms part of the Annual Report. The Auditors' Certificate confirming the compliance to the conditions of the Corporate Governance stipulated in Clause 49 of the Listing Agreement is annexed to the Corporate Governance Report.

Management Discussion and Analysis

As required by Clause 49 of the Listing Agreement, the Management Discussion and Analysis is annexed and forms part of the Directors' Report.

Directors

In accordance with the provisions of the Act and Articles 64, 65 and 66 of the Articles of Association of your Company, Mr. Sanjay Khosla and Mr. Subroto Bhattacharya, Directors of your Company, retire by rotation and are due for election at the ensuing Annual General Meeting. Mr. Sanjay Khosla, being eligible, offers himself for re-appointment, however, Mr. Subroto Bhattacharya has expressed his desire not to be re-appointed as a Director.

The Board recommends the re-appointment of Mr. Sanjay Khosla and retirement of Mr. Subroto Bhattacharya pursuant to the applicable provisions of the Act. The resolutions seeking your approval on these items along with the requisite disclosures/explanatory statement are included in the Notice for convening the Annual General Meeting.

Your Directors wish to place on record their appreciation for the contributions made by Mr. Subroto Bhattacharya during the period of his association with the Company.

Directors' Responsibility Statement

As required under Section 21 7(2AA) of the Act, the Board of Directors of your Company hereby states and confirms:

- That in preparation of Annual Accounts for the financial year, applicable Accounting Standards have been followed along with the proper explanations relating to material departures;

- That they have selected the accounting policies described in the notes to accounts, which have been consistently applied, except where otherwise stated 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 March 31, 2012 and of the profit of the Company for that year;

- That they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

- That the Annual Accounts have been prepared on the historical cost convention, as a going concern basis and on accrual basis.

Information relating to Conservation of energy, Technology Absorption, Research and Development, Exports, Foreign exchange earnings and Outgo and other information forming part of the Directors' Report in terms of Section 217(1)(e) of the Act, and the Rules made thereunder

a) Conservation of energy

Although the operations of the Company are not energy intensive, the management has been highly conscious of the criticality of conservation of energy

at all the operational levels and efforts are made in this direction on a continuous basis. Adequate measures have been taken to reduce energy consumption whenever possible by using energy efficient equipments. The requirement of disclosure of particulars with respect to conservation of energy as prescribed in Section 217(1)(e) of the Act read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are not applicable to the Company and hence are not provided.

b) Technology absorption

Your Company believes that in addition to progressive thought, it is imperative to invest in research and development to ascertain future exposure and prepare for challenges. In its endeavor to obtain and deliver the best, your Company has entered into alliances/tie-ups with major global players in the IT education industry to harness and tap the latest and the best of technology in its field, upgrade itself in line with the latest technology in the world and deploy/absorb technology wherever feasible, relevant and appropriate.

c) Research and Development

The Company believes that technological obsolescence is a reality. Only progressive research and development will help us to measure up to future challenges and opportunities. We invest in and encourage continuous innovation. During the year under review, expenditure on research and development is not significant in relation to the nature and size of operations of your Company.

d) Foreign exchange earnings and outgo

i) Activities relating to exports, initiatives taken to increase exports, development of new export markets for products and services and export plans

The Company exports customized learning content to its overseas clients to meet their varying learning needs. The Company develops content in a range of subjects for widely varied audience. The Company will continue to strengthen its presence in China, South Africa, Nigeria, Malaysia, Vietnam, Bhutan, Norway, Maldives, Columbia etc. with a view to increase exports. The Company will put impetus on potential geographies for expansion of its business outside India.

ii) Total foreign exchange earned and used

The details of foreign exchange earnings and outgo are mentioned in Notes Nos 31-35 contained in the Notes to Accounts forming part of the Balance Sheet and Statement of Profit and Loss for the financial year ended March 31, 2012.

Public Deposits

In terms of the provisions of Section 58A of the Act read with the Companies (Acceptance of Deposits) Rules, 1975, your Company has not accepted any fixed deposits from public and as such, no amount of principal or interest was outstanding on the date of the Balance Sheet.

Particulars of Employees

As required by Section 217(2A) of the Act read with the Companies (Particulars of Employees) Rules, 1975, the particulars of employees form part of this report. However, as permitted by Section 219(1)(b)(iv) of the Act, the report and accounts are being sent excluding the statement containing the particulars to be provided under Section 217(2A) of the Act. Any member interested in obtaining such particulars may inspect the same at the Registered Office of the Company or write to the Company Secretary of the Company for a copy thereof.

Auditors and Auditors' Report

M/s Price Waterhouse, Chartered Accountants (registration number FRN301112E), the Statutory Auditors of your Company, holds office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received a letter from them to the effect that their re-appointment, if made, would be within the limits prescribed under Section 224(1B) of the Act and that they are not disqualified for re-appointment within the meaning of Section 226 of the Act.

The notes on Accounts referred to in the Auditors' Report are self explanatory and do not require any further comments.

Human Resources and Employees' Stock Option Scheme

NIITians are the key resource for your Company. Your Company has been able to create and continuously improve a favorable work environment that encourages novelty and meritocracy at all levels.

Employees' relations remained cordial at all the Company's locations. The Directors take this opportunity to record their appreciation for the outstanding contribution of all NIITians.

During the financial year 2005-06, your Company had launched NIIT Employee Stock Option Plan 2005 (ESOP-2005) with the objective of attracting and motivating employees by rewarding performance and retaining the best talent. The aim was to develop a sense of ownership among the employees within the organisation and to align your Company's stock option scheme with the best practices in the Industry. The Compensation/Remuneration Committee has granted 1 00,000 Stock Options (Grant VIII) at the face value of the share to the eligible employees under ESOP-2005. As per the provisions of SEBI (Employees Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines,! 999, the particulars of the options granted, vested, exercised and allotted under the ESOP-2005 are appended as Annexure-1 and form part of this report.

Further, none of the employees was granted options equal to or exceeding 1% of the issued capital of the Company.

Acknowledgements

Your Directors take this opportunity to thank all investors, clients, licensees, technology partners, vendors, financial institutions, banks, regulatory and governmental authorities, media and stock exchanges for their continued support during the year under review. We place on record our appreciation of the contribution made by our employees at all levels. Our consistent growth was made possible by their hardwork, solidarity, cooperation and support.

For and on behalf of the Board

Rajendra S Pawar

Chairman &

Place : New Delhi Managing Director

Date : May 9, 2012 DIN - 00042516

 
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