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Notes to Accounts of Redington (India) Ltd.

Mar 31, 2017

1. Financial risk management:

These financial risk management policies are applied in order to mitigate potential adverse impact on the financial performance. The note below explains how the Company''s exposure to various risks, such as market risk (foreign exchange and interest rate risk) credit risk, liquidity risk and capital risk are addressed/mitigated.

1. Market Risks

a. Foreign exchange risk:

The Company enters into transactions denominated in foreign currencies. In order to mitigate risks arising on account of foreign currency fluctuations, the Company has set the following policies with respect to foreign exchange risk management.

The Company, wherever applicable have used foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions. Most of the transactions of the Company are in Indian rupees and transactions in foreign currencies are majorly hedged by a forward cover.

Sensitivity analysis:

The Company applies 10% as the sensitivity rate while ascertaining foreign currency exposure. Accordingly 10% strengthen of Indian Rupees against all relevant uncovered foreign currency transactions would have impacted profit before tax by Rs, 109.13 Lakhs (Previous year Rs, 405.85 Lakhs). Similarly for 10% weakening of Indian Rupees these transactions, there would be an equal and opposite impact on the profit before tax.

b. Interest rate risk management

The Company funds at fixed interest rates. Hence the Company is not required to determine the sensitivity analyses with regard to interest rate risk

2. Credit risk management

Credit risk is minimized through conservative credit policy by the Company. Credit insurance is also taken to mitigate the credit risk. The Company sells to both small retailers and large format retailers, giving them a credit period of 30- 60 days. The Company mitigates credit risk by strict receivable management procedures and policies. The Company has a dedicated independent team to review credit and monitor collection of receivables on a pan India basis. The efficacy of this process is proven by the fact that receivables more than 6 months are only 5% of the total receivable.

3. Liquidity risk management

The Company has built an appropriate liquidity risk management framework for its short, medium and long-term funding and liquidity requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and financial liabilities.

The following table details the Company''s remaining contractual maturity for its non-derivative financial liabilities. The table has been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company will be required to pay.

4. Capital risk management

The Company manages its capital to ensure that the Company will be able to continue as a going concern while maximizing the return to shareholder through the optimization of the debt and equity balance.

5 Related party disclosures (As per Ind AS 24)

6) Key Management Personnel

Mr. Raj Shankar, Managing Director

Mr. M. Raghunandan, Whole time Director (Till May 24, 2016)

Mr. E.H. Kasturi Rangan, Whole time Director (From May 24, 2016)

Refer Note 37 below for remuneration

7) Names of the related parties

Party where the Company has Redington Employee Share Purchase Trust * control

Parties having Significant Synnex Mauritius Limited, Mauritius *

Influence on the Company Harrow Investment Holding Limited, Mauritius *

Subsidiary Companies Nook Micro Distribution Limited, India (Refer Note:43)

Cadensworth (India) Limited, India*

Redington International Mauritius Limited, Mauritius*

Redington Gulf FZE, Dubai

Cadensworth FZE, Dubai

Redington Gulf & Co. LLC, Oman

Redington Nigeria Ltd, Nigeria

Redington Egypt Ltd (Limited liability company), Egypt

Redington Kenya Ltd, Kenya

Redington Middle East LLC, Dubai

Redington Qatar WLL, Qatar

Ensure Services Arabia LLC, Saudi Arabia

Redington Africa Distribution FZE, Dubai

Ensure Services Bahrain S.P.C, Bahrain

Redington Distribution Pte. Limited, Singapore *

Redington Bangladesh Limited, Bangladesh

Subsidiary Companies Redington Qatar Distribution W.L.L., Qatar

Redington Kenya (EPZ) Ltd, Kenya

Redington Limited, Ghana

Redington Uganda Limited, Uganda

Africa Joint Technical Services, Libya

Redington Gulf FZE Co, Iraq

Cadensworth UAE LLC, Dubai

Redington Morocco Limited, Morocco

Redington Tanzania Ltd., Tanzania

Redington SL (Private) Ltd., Sri lanka

Redington Angola Limited, Angola

Redington Turkey Holdings S.A.R.L, Luxembourg

Arena Bilgisayar Sanayi Ve Ticaret A.S..Turkey

Arena International FZE, Dubai

Ensure IT services (pty) Ltd., South Africa

ProConnect Supply Chain Solutions Limited, India*

Ensure Gulf FZE, Dubai

Ensure Technical Services (PTY) Ltd., South Africa Ensure Middle East Trading LLC, Dubai Ensure Technical Services Kenya Limited, Kenya Ensure Technical Services Tanzania Limited, Tanzania Ensure Services Uganda Limited, Uganda Ensure Solutions Nigeria Limited, Nigeria Redington Rwanda Ltd, Rwanda Redington Kazakhstan LLP, Kazakhstan

Sensonet Teknoloji Elektronik Ve Bilisim Hizmetleri Sanayi Ve Ticaret A.S., Turkey

ProConnect Supply Chain Logistics LLC, Dubai

Ensure Ghana Limited, Ghana

Ensure Support Services (India) Limited, India*

Ensure Technical Services Morocco Limited (SARL), Morocco

Adeo Bilisim Danismanlik Hizmetleri San. Ve Tic. A.S. (“ADEO”), Turkey **

Redington Senegal Limited SARL

Redington Saudi Arabia Distribution Company, Saudi Arabia

Paynet Odeme Hizmetleri A.S., Turkey

CDW International Trading FZE, Dubai

RNDC Alliance West Africa Limited, Nigeria

Linkplus Bilgisayar Sistemleri Sanayi ve Ticaret A.S, Turkey

Incorporated during the year

Redserv Business Solutions Private Limited, India ProConnect Saudi LLC, Saudi Arabia Redington Distribution Company LLC, Egypt Ensure MiddleEast Technology Solutions LLC, Abu Dhabi Rajprotim Supply Chain Solutions Limited, India Associate Redington (India) Investments Limited, India

Subsidiary of Associate Currents Technology Retail (India) Limited, India*

* Represents related parties with whom transactions have taken place during the year.

** Disposed during the year

Related Parties are as identified by the management.

Pursuant to the notification by the Ministry of Corporate Affairs, the petition for the approval of the Scheme filed with the Hon''ble Madras High Court has been transferred to National Company Law Tribunal (NCLT), Chennai Bench.

Pending approval of the Scheme by NCLT, the results of the said subsidiary as at and for the Year Ended March 31, 2017 have not been included in the Standalone Financial Results.

8. Merger of Nook Micro Distribution Limited

Nook Micro Distribution Limited (“Nook / Transferor Company”), an erstwhile wholly owned subsidiary of the Company was engaged in trading on IT, Consumer Durable and Telecom products. The Board of Directors of the Company, in their meeting held on August 3, 2015 had approved a scheme of amalgamation of Nook with the Company, with effect from 1st April 2015. The Scheme was sanctioned by the Hon''ble High Court of Judicature at Madras vide their Order dated March 11, 2016 and the assets and liabilities of the Transferor Company were transferred to and vested with the Company with effect from the Appointed date - April 1, 2015. Since this is the common control transaction, as per Appendix C of Ind AS 103, the impact of the scheme has been considered in the earliest period presented, i.e. the balance sheet as on April 1, 2015 (Refer Note 48 for the effect of the merger on the opening balance sheet on the date of transition to Ind AS)

9. For the year 2016-17, the Company is required to spend Rs, 540.97 Lakhs (Previous year: Rs, 516.78 Lakhs) on "Corporate Social Responsibility (CSR)" against which the Company has spent Rs, 540.00 Lakhs, being the contribution made by the Company to a Trust formed for the purposes of carrying out CSR activities. In the previous financial year, CSR activities were performed out of the funds/ provision earmarked for this purpose in the earlier years.

10. Segment Reporting

Since the Company prepares consolidated financial statements as per Ind AS-108 “Operating Segment”, segment information has been disclosed in consolidated financial statements.

11. Employee Stock Option Plan 2008

The Company follows intrinsic value method as per previous GAAP for accounting of employee stock options and decided to avail exemption under Ind AS 101 from retrospective application of accounting requirements prescribed under Ind AS 102 for outstanding options as on the transition date. Hence no compensation costs have been recognized in these accounts as the options have been granted at the prevailing market prices.

* Out of the total options granted in 2008, 1,959,830 options were reprised at Rs, 130/- on January 28, 2009 and 75,000 options were reprised at Rs, 165/- on May 22, 2009

The variables used for calculating the Fair Values of Grant V and their rationale are as follows:

A. Stock price

The closing market price on the date prior to the date of grant on National Stock Exchange (NSE) has been considered for the purpose of option valuation.

B. Volatility

Volatility is a measure of the amount by which a price has fluctuated or is expected to fluctuate during a period. The measure of volatility used in the Black-Scholes option-pricing model is the annualized standard deviation of the continuously compounded rates of return on the stock over a period of time.

The period to be considered for volatility has to be adequate to represent a consistent trend in the price movements. It is also important that movements due to abnormal events get evened out.

There is no research that demonstrates conclusively how long the historical period used to estimate expected long term future volatility should be. However, Guidance note on Accounting for Employee Share-based Payments issued by the Institute of Chartered Accountants of India recommends including the historical volatility of the stock over the most recent period that is generally commensurate with the expected life of the option being valued.

The entity''s stocks have been publicly traded on NSE and BSE. For calculating Volatility, we have considered the daily volatility of the stock prices on NSE, over a period prior to the date of grant, corresponding with the expected life of the options.

The Fair value of an option is very sensitive to this variable. Higher the volatility, higher is the Fair value. The rationale being, the more volatile a stock is, the more is its potential to go up (or come down), and the more is the probability to gain from the movement in the price. Accordingly, an option to buy a highly volatile stock is more valuable than the one to buy a less volatile stock, for the probability of gaining is lesser in the latter case.

C. Risk free interest rate

The risk-free interest rate being considered for the calculation is the interest rate applicable for maturity equal to the expected life of the options based on the zero-coupon yield curve for Government Securities.

D. Exercise Price

Options have been granted primarily at a price of Rs, 348.05 on February 29, 2008. Subsequently, 1,959,830 and 75,000 options were re-priced at a Market price of Rs, 130/- and Rs, 165/- on January 28, 2009 and May 22, 2009 respectively. On December 5, 2011 173,212 options were granted at a price of Rs, 396.50 per option.

E. Time to Maturity / Expected Life of options

Time to Maturity / Expected Life of options is the period for which the Company expects the options to be live. The minimum life of a stock option is the minimum period before which the options cannot be exercised and the maximum life is the period after which the options cannot be exercised.

According to SEBI Guidelines, the expected life of an award of stock options shall take into account the following factors -

i. The expected life must at least include the vesting period.

ii. The average lengths of time of similar grants have remained outstanding in the past. If the Company does not have a sufficiently long history of stock option grants, the experience of an appropriately comparable peer group may be taken into consideration.

iii. The expected life of stock options should not be less than half of the exercise period of the stock options issued until and unless the same is supported by historical evidences with respect to stock options issued by the Company earlier.

The fair value of each award has been determined based on different expected lives of the options that vest each year, as it would be if the award were viewed as several separate awards, each with a different vesting date. A weighted average of all vests has been calculated to arrive at the value of the options.

The time to maturity has been estimated as illustrated by the following example. In case of the grant made on December 5, 2011, the earliest date of exercise is December 5, 2012 i.e. one year from the date of grant. The exercise period is five years from the date of vest.

Hence, the time to maturity for the first vest is equal to the average of the minimum period plus the maximum period i.e. 1 year 6 Years = 3.5 years. Time to Maturity has been estimated on a similar basis for the remaining vests.

Expected Dividend yield: Expected dividend yield has been calculated as an average of dividend yields for the preceding 2 years to the year of grant.

12. Transition to Ind AS:

13 First-time adoption of Ind AS:

The financial statements for the year ended March 31, 2017 are the first financial statements prepared by the Company in accordance with Ind AS. For the periods up to and including the year ended March 31, 2016, the Company prepared its financial statements in accordance with the Generally Accepted Accounting Principles in India (previous GAAP). Reconciliation and description of the effect of transition from previous IGAAP to Ind AS are provided in Note 48.

Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for the year ended March 31, 2017, together with the comparative year data as at and for the year ended March 31, 2016, as described in the summary of significant accounting policies. In preparing these financial statements, the Company prepared the opening balance sheet as at April 1, 2015, being the transition date. Note 48 explains the principal adjustments made by the Company in restating its previous GAAP financial statements, including the balance sheet as at April 1, 2015 and the financial statements as at and for the year ended March 31, 2016.

14 Exceptions to retrospective application of Ind AS:

Ind AS 101 allows certain exemptions to first-time adopters from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions:

Mandatory Exceptions: a. Estimates:

When the Company needs to make estimates under Ind AS that were not required under previous GAAP or vice-versa, the estimates must reflect conditions at the date of transition to Ind AS. On an assessment of the estimates made under previous GAAP, the Company has concluded that there is no necessity to revise the estimates under IND AS.

b. Hedge Accounting:

Hedge accounting is to be applied only to hedge relationships that meet the requirements of hedge accounting in accordance with Ind AS 109. An entity shall not reflect in its Ind AS balance sheet a hedge relationship that does not qualify under Ind AS 109. The Company has retrospectively applied these principles and elected not to disclose in its balance sheet, the relationships that do not qualify for hedge accounting under Ind AS 109.

Optional Exemptions: a. Deemed Cost:

The Company being a first time adopter has elected to carry the value of Property, Plant and Equipment and Intangible assets as per Balance sheet prepared under previous GAAP under deemed cost model. The Company has elected to regard those values of property as its deemed cost as at the date of transition and elected not to revalue those assets.

Notes to reconciliations:: a. Discounting of Long Term Security Deposits:

Lease deposits held as on the transition date has been measured at fair value of which is estimated at the present value of the deposit, discounted using the prevailing market rate of Government securities.

i. The difference between the carrying value and the fair value amounting to Rs, 90.40 Lakhs is increased to the Retained earnings as on 1st April 2015. The said difference between the present value of the deposit and the recoverable value is amortized over the lease period as prepaid expenses. The value of prepaid expense for the lease deposit held as on transition date is Rs, 78.34 Lakhs which is decreased to the Retained earnings as on 1st April 2015.

ii. Rental expenses & Interest Income for the above amortization value for the year ended March 31, 2016 has been charged to Statement of Profit and loss to the extent of Rs, 16.33 Lakhs and Rs, 15.67 Lakhs respectively.

b. Tax adjustments:

Tax expense has been recomputed based on the Ind AS adjustment and the differential amount is charged to Provision for Taxation which has been charged to Statement of Profit and loss to the extent of Rs, 0.07 Lakhs. The difference effect on Transition date has been adjusted against Deferred Tax and the Retained earnings as on 1st April 2015, to the extent of Rs, 20.05 Lakhs.

c. Dividend:

Under previous GAAP, equity dividend recommended by the board of directors after the end of the reporting period but before the financial statements were approved was recognized in the financial statements as a liability. Under Ind AS 10, such dividends are to be recognized when approved by the members in a general meeting. Accordingly an amount of Rs, 9,963.17 Lakhs recognized as liability in the financial year 2015-16 is reversed and the same is adjusted in Equity in the year 2016-17 and similarly an amount ofRs, 9,028.03 Lakhs recognized as liability in the financial year 2014-15 was reversed and adjusted in Equity in the year 2015-16 as paid.

d. Effect of changes in Foreign Exchange:

Net movement in Hedge accounting reserves has been reclassified as Exchange gain/(loss) which has been charged to Statement of Profit and loss, amounting to Rs, 17.66 Lakhs

e. Foreign Currency Translation Reserve:

Movement Foreign Currency Translation reserve (FCTR) for the year ended March 31, 2016 amounting to Rs, 7.10 Lakhs has been reclassified under Other Comprehensive Income, which was shown as a part of Reserves in the Balance Sheet. Refer Note 2.3(h) for accounting of FCTR

h. There were no significant reconciliation items between cash flows prepared under previous GAAP and those prepared under Ind AS

15. Events after the Reporting period (Non-adjusting)

The Board of Directors at its meeting held on May 25, 2017 has recommended a dividend ofRs, 2.30 per Equity share ofRs, 2/- each (i.e., 115% of face value) for the Financial Year Ended March 31, 2017 (Previous Year Rs, 2.10 per Equity Share ofRs, 2/- each - i.e., 105% of face value) subject to the approval of shareholders in the ensuing Annual General Meeting.

16. Disclosure on Specified Bank Notes (SBNs)

During the year, the Company had specified bank notes and other denomination notes. As defined in the MCA notification G.S.R. 308 (E) dated March 30, 2017 on the details of Specified Bank Notes (SBN) held and transacted during the period from November 8, 2016 to December 30, 2016, the denomination wise SBNs and other notes as per the notification is given below:

*For the purpose of this disclosure, the term ‘Specified Bank Notes'' shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs, S.O No. 3407(E), dated November 8, 2016

17. The Board of Directors at its meeting held on February 3, 2017 declared a special (Interim) dividend of Rs, 2/- per Equity share of Rs, 2/- each -i.e., 100% of face value.

18. The financial statements were approved for issue by the board of directors on May 25, 2017.


Mar 31, 2015

1. Company Overview

Redington (India) Limited ("the Company"), is a public limited Company domiciled in India and incorporated under the provisions of the Companies Act, 1956. The Company's equity shares are listed on the bourses of BSE Limited and National Stock Exchange of India Limited. The Company operates in the Information Technology product distribution business supply chain solutions and after sales services of Information Technology products. The Company has setup a branch in Singapore which has become operational during the year. The Company and its subsidiaries operate in India, Middle East, Turkey, Africa, and South Asia countries.

2. Basis of preparation of financial statements

2.1 The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 ("the 2013 Act") / Companies Act, 1956 ("the 1956 Act"), as applicable. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

3. Terms/rights attached to equity shares;

Each holder of equity share is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. For the year ended March 31, 2015 a dividend of Rs. 1.90 per equity share has been proposed by the Board of Directors (Previous year Rs. 0.90 per equity share). The dividend proposed by the Board of Directors is subject to the approval of the shareholders at the ensuing Annual General Meeting which includes an agenda item to consider declaration of dividend.

4. Contingent Liabilities & Commitments Rs. in Lakhs

Particulars 31-Mar-2015 31-Mar-2014

i. Bills Discounted 6,200.79 9,396.64

ii. Channel financing 1,975.00 4,603.70

ii. Factoring 7,525.00 8,212.50

iv. Claims not acknowledged as debts 359.36 337.68

v. Disputed Customs Duty/Income Tax/Sales Tax demands

Rs. in Lakhs

Nature of Dues 31-Mar-2015 31-Mar-2014

Customs duty 97.03 97.03

Income Tax 952.79 18,964.47 @

Sales Tax 1,566.34 1,813.64

@ The Income tax demand on the Company of Rs. 129 Crores (besides interest of Rs. 78 Crores) arising mainly on account of tax on capital gains from the transfer of Company's investment in an overseas subsidiary to another overseas step-down subsidiary raised for the assessment year ended on March 31,2009 has been set aside by the Income Tax Appellate Tribunal, Chennai vide its order dated July 7, 2014. The Company has not received any intimation to date from the Income tax department contesting the Appellate order of Income Tax Appellate Tribunal.

5. Capital Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is Rs. 34.25 Lakhs (Previous Year Rs. 1,245.25 Lakhs).

Pursuant to the announcement of the Institute of Chartered Accountants of India (ICAI) in respect of "Accounting for Derivatives", the Company had opted to follow the recognition and measurement principles relating to derivatives as specified in AS 30 "Financial Instruments, Recognition and Measurement", issued by the ICAI, from the year ended March 31,2008.

Consequently, as of March 31,2015, the Company has recognised Mark to Market (MTM) loss of Rs. 3.14 Lakhs. (Previous Year loss of Rs. 9.86 Lakhs) relating to forward contracts and other derivatives entered into to hedge the foreign currency risk of highly probable forecast transactions that are designated as effective cash flow hedges, in the Hedge Accounting Reserve as part of the Shareholders Funds.

The MTM net loss on undesignated / ineffective forward contracts amounting to Rs. 17.68 Lakhs (Previous Year Rs. 23.25 Lakhs) has been recognised in the Statement of Profit and Loss.

6. Related party disclosures (As per AS 18)

1) Key Management Personnel

Mr. R Srinivasan, Managing Director (Till October 17, 2014)

Mr. Raj Shankar, Managing Director (from October 17, 2014)

Mr. M Raghunandan, Wholetime Director

Refer Note 28 below for remuneration

7. Names of the related parties

Party where the Company Redington Employee Share Purchase has control Trust *

Parties having Significant Harrow Investment Holding Limited, Influence on the Company Mauritius * (Ceased to be parties having significant influence in the current financial year)

Synnex Mauritius Limited, Mauritius *

Subsidiary Companies Nook Micro Distribution Limited, India * Cadensworth (India) Limited, India * Redington International Mauritius Limited, Mauritius * Redington Gulf FZE, Dubai Cadensworth FZE, Dubai * Redington Gulf & Co. LLC, Oman Redington Nigeria Ltd, Nigeria Redington Egypt Ltd, Egypt Redington Kenya Ltd, Kenya Redington Middle East LLC, Dubai Redington Qatar WLL, Qatar

Subsidiary Companies Ensure Services Arabia LLC, Saudi Arabia Redington Africa Distribution FZE. Dubai Ensure Services Bahrain SPC, Bahrain Redington Distribution Pte Ltd, Singapore * Redington Bangladesh Limited, Bangladesh Redington Qatar Distribution WLL, Qatar Redington Kenya EPZ Ltd, Kenya Redington Limited, Ghana Redington Uganda Limited, Ugand Africa Joint Technical Services, Libya Redington Gulf FZE Co, Iraq Cadensworth United Arab Emirates LLC, Dubai Redington Morocco Limited, Morocco Redington Tanzania Ltd., Tanzania Redington SL (Private) Limted, Sri lanka Redington Angola Limited, Angola Redington Turkey Holdings S.A.R.L, Luxembourg Arena Bilgisayar Sanayi Ve Ticaret Anonim Sirketi, Turkey # Arena International FZE, UAE Ensure IT Services PTY Limited, South Africa ProConnect Supply Chain Solutions Limited, India * Ensure Gulf FZE, Dubai Ensure Technical Service (PTY) Limited, South Africa Ensure Middle East Trading LLC,UAE Ensure Technical Services Kenya Limited, Kenya Ensure Technical Services Tanzania Limited, Tanzania Ensure Services Uganda Limited, Uganda Ensure Solutions Nigeria Limited, Nigeria Redington Rwanda Limited, Rwanda Redington Kazakhstan LLP, Kazakhstan Republic Sensonet Teknoloji Elelektronik Ve Bilisim Hizmetlen Sanayi- Ve Ticaret Limited Sirketi, Turkey ProConnect Supply Chain Logistics LLC, Dubai Ensure Ghana Limited, Ghana Ensure Support Services (India) Limited, India * Ensure Technical Services Morocco Limited(SARLAU), Morocco Ensure Digital FZ LLC, Dubai ADEO Bilisim Danismanlik Hizmetleri San. ve Tic.A.S., Turkey A

Formed during the year Redington Senegal Limited SARL, Senegal Redington Saudi Arabia for Distribution Company, Saudi Arabia

Acquired during the year Paynet Odemet Hizmetleri A. s.

Associate Redington (India) Investments Limited, India *

Subsidiary of Associate Currents Technology Retail (India) Limited, India *

* Represents related parties with whom transactions have taken place during the year.

# As Redington Turkey Holdings S.A.R.L. has effective control over the composition of Board of Directors, Arena Bilgisayar Sanayi Ve Ticaret Anonim Sirketi is considered as subsidiary.

A Arena Bilgisayar Sanayi Ve Ticaret Anonim Sirketi, the step down subsidiary acquired 50% shares. Related Parties are as identified by the management.

8. Since the Company prepares consolidated financial statements as per AS-17 "Segment Reporting", segment information has been disclosed in consolidated financial statements

9. The Company is required to spend Rs. 495 Lakhs on "Corporate Social Responsibility (CSR)" during the financial year 2014-15. The Company has accordingly constituted a CSR Committee which has approved the budgeted expenditure to be spent on identified areas / projects and the management is committed to spend this amount during the financial year 2015-16. Accordingly a provision for the said amount has been made in these financial statements. The Company has also earmarked the funds for meeting the expenditure by transferring the amount of Rs. 495 Lakhs to a separate bank account opened for this purpose (Refer note 16).

10. The figures of the previous year have been regrouped wherever necessary to conform to the classification of the current year.


Mar 31, 2014

1. Company Overview

Redington (India) Limited ("the Company"), is a public limited Company domiciled in India and incorporated under the provisions of the Companies Act, 1956. The Company''s equity shares are listed on the bourses of BSE Limited and National Stock Exchange of India Limited. The Company operates in the Information Technology and other products distribution and after sales service. The Company and its subsidiaries operate in India, South Asia, Middle East, Turkey and Africa.

2. Basis of preparation of financial statements

2.1 The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notifed under Section 211(3C) of the Companies Act, 1956 ("the 1956 Act") (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 ("the 2013 Act") in terms of General Circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs) and the relevant provisions of the 1956 Act/2013 Act, as applicable. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

The financial statements and documents required to be attached thereto, upto year ended March 31, 2014 would be governed by the provisions of Schedule VI of the Companies Act, 1956 as clarifed by Ministry of Corporate Affairs in its circular no 08/2014 dated April 4, 2014.

3. Contingent Liabilities & Commitments

Rs. in Lakhs

Particulars 31-Mar-2014 31-Mar-2013

i. Corporate Guarantees on behalf of subsidiaries - 57,025.50

ii. Bills Discounted 9,396.64 4,619.76

iii. Channel fnancing 4,603.70 4,350.00

iv. Factoring 8,212.50 9,525.00

v. Claims not acknowledged as debts 337.68 253.16

vi. Disputed Customs Duty/Income Tax/Sales Tax demands

Rs. in Lakhs Nature of Dues 31-Mar-2014 31-Mar-2013

Customs duty 97.03 110.88

Income Tax 18,964.47 795.39

Sales Tax 1,813.64 1,006.63

The Income Tax Assessment for the Accounting Year ended on March 31, 2009 has been completed in January 2014 resulting in a tax demand of Rs. 129 Crores (besides interest of Rs. 78 Crores) mainly on account of tax on Capital Gain arising from Transfer of Company''s investment in an overseas subsidiary to another overseas step-down subsidiary in November 2008.

The Company has preferred an appeal against the said demand before the Income Tax Appellate Tribunal (ITAT), Chennai. The Company has paid Rs. 22 Crores under protest and the ITAT has granted stay for recovery of balance tax demand till August 31, 2014 or disposal of the case whichever is earlier.

Based on eminent tax counsels opinion the management is hopeful of successfully contesting the demand in appeal; accordingly no provision towards the disputed tax claim is presently considered necessary.

vii. Capital Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is Rs. 1,245.25 Lakhs (Previous Year Rs. 2,615.25 Lakhs).

4. Operating Leases

The Company has taken cancelable operating leases for its office premises, which is for a period ranging from 11 months to 9 years.

5. Accounting for Financial Instruments

Pursuant to the announcement of the Institute of Chartered Accountants of India (ICAI) in respect of "Accounting for Derivatives", the Company had opted to follow the recognition and measurement principles relating to derivatives as specified in AS 30 "Financial Instruments, Recognition and Measurement", issued by the ICAI, from the year ended March 31, 2008.

Consequently, as of March 31, 2014, the Company has recognised Mark to Market (MTM) loss of Rs. 9.86 Lakhs. (Previous Year loss of Rs. 0.54 Lakhs) relating to forward contracts and other derivatives entered into to hedge the foreign currency risk of highly probable forecast transactions that are designated as effective cash fow hedges, in the Hedge Accounting Reserve as part of the Shareholders Funds.

The MTM net loss on undesignated / ineffective forward contracts amounting to Rs. 23.25 Lakhs (Previous Year Rs. 5.65 Lakhs) has been recognised in the Statement of profit and Loss.

6. Related party disclosures

1) Key Management Personnel

Mr. R Srinivasan, Managing Director Mr. Raj Shankar, Joint Managing Director Mr. M Raghunandan, Whole-Time Director

Refer Note 28 below for remuneration

2) Names of the related parties

Party where the Company has control

Redington Employee Share Purchase Trust *

Parties having significant Infuence on the Company

Harrow Investment Holding Limited

(formerly known as Redington (Mauritius) Limited), Mauritius *

Synnex Mauritius Limited, Mauritius *

Subsidiary Companies

Nook Micro Distribution Limited, India *

Cadensworth (India) Limited, India*

Easyaccess Financial Services Limited* (Ceased to be Subsidiary w.e.f January

22,2014 (Refer note-35))*

Redington International Mauritius Limited, Mauritius*

Redington International (Holdings) Limited, Cayman Islands ¥

Redington Gulf FZE, Dubai

Cadensworth FZE, Dubai*

Redington Gulf & Co. LLC, Oman

Redington Nigeria Ltd, Nigeria

Redington Egypt Ltd, Egypt

Redington Kenya Ltd, Kenya

Redington Middle East LLC, Dubai

Redington Qatar WLL, Qatar

Ensure Services Arabia LLC, Saudi Arabia (formerly known as Redington Arabia

Limited, Saudi Arabia)

Redington Africa Distribution FZE. Dubai

Ensure Services Bahrain SPC, Bahrain (formerly known as Redington Bahrain SPC,

Bahrain)

Redington Distribution Pte Ltd, Singapore *

Redington Bangladesh Limited, Bangladesh

Redington Qatar Distribution WLL, Qatar

Redington Kenya EPZ Ltd, Kenya

Redington Limited, Ghana

Redington Uganda Limited, Uganda

Africa Joint Technical Services, Libya

RGF Private Trust Company Limited, Cayman Islands

Subsidiary Companies

Redington Gulf FZE Co, Iraq

Cadensworth United Arab Emirates LLC, Dubai

Redington Morocco Limited, Morocco

Redington Tanzania Ltd., Tanzania

Redington SL (Private) Limted, Sri lanka

Redington Angola Limited, Angola

Redington Turkey Holdings S.A.R.L, Luxembourg

Arena Bilgisayar Sanayi Ve Ticaret Anonim Sirketi, Turkey #

Arena International FZE, UAE

Ensure IT Services PTY Limited, South Africa

ProConnect Supply Chain Solutions Limited, India*

Ensure Gulf FZE, Dubai

Ensure Technical Service (PTY) Limited, South Africa

Ensure Middle East Trading LLC,UAE

Ensure Technical Services Kenya Limited, Kenya

Ensure Technical Services Tanzania Limited, Tanzania

Ensure Services Uganda Limited, Uganda

Ensure Solutions Nigeria Limited, Nigeria

Redington Rwanda Limited, Rwanda

Redington Kazakhstan LLP, Kazakhstan Republic

Sensonet Teknoloji Elelektronik Ve Bilisim Hizmetlen Sanayi- Ve Ticaret Limited Sirketi,

Turkey

Formed during the year

Ensure Supply Chain Logistics LLC, Dubai

Ensure Ghana Limited, Ghana

Ensure Support Services (India) Limited, India*

Ensure Technical Services Morocco Limited(SARLAU), Morocco

Ensure Digital FZ LLC, Dubai

Acquired during the year

ADEO Bilisim Danismanlik Hizmetleri San. ve Tic.A.S., Turkey ^

Associate

Subsidiary of Associate

Redington (India) Investments Limited, India * Currents Technology Retail (India) Limited, India *

* Represents related parties with whom transactions have taken place during the year.

# As Redington Turkey Holdings S.A.R.L. has effective control over the composition of Board of Directors, Arena Bilgisayar Sanayi Ve Ticaret Anonim Sirketi is considered as subsidiary.

^ Arena Bilgisayar Sanayi Ve Ticaret Anonim Sirketi, the step down subsidiary acquired 50% shares.

Â¥ Redington International Holdings Limited got merged with Redington International Mauritius Limited on July 10, 2013.

Related Parties have been identified by the management.

7. The Company has setup a branch in Singapore on February 28, 2014. As at the Balance Sheet date, the Branch is yet to commence its operations.

8. Event occurring after the Balance Sheet date

The Company has made an additional equity investment of Rs. 2,924.63 Lakhs in its wholly-owned subsidiary Redington International Mauritius Limited in May 2014.

9. Exceptional item

Pursuant to the approval of the shareholders through Postal ballot, the Company divested its equity interest in Easyaccess Financial Services Limited to M/s. Harrow Investment Holding Limited, 86% in January 2014 and balance 14% in March 2014. Consequently Easyaccess Financial Services Limited ceased to be a subsidiary Company w.e.f January 22, 2014. profit of Rs. 6,575.66 Lakhs arising out of divestment of equity interest in Easyaccess Financial Services Limited is disclosed as exceptional item.

10. The figures of the previous year have been regrouped wherever necessary to conform to the classifcation of the current year.


Mar 31, 2013

1. Company Overview

Redington (India) Limited ("the Company"), is a public limited Company domiciled in India and incorporated under the provisions of the Companies Act, 1956. The Company''s stocks are listed on the bourses of BSE Limited and National Stock Exchange of India Limited. The Company operates in the distribution business and after sales service of Information Technology and other products. The Company and its subsidiaries operate in India, South East Asia, Middle East, Africa and Turkey.

2. Basis of preparation of financial statements

2.1 The financial statements have been prepared under the historical cost convention on accrual basis and in accordance with Generally Accepted Accounting Principles in India ("Indian GAAP"). These financial statements comply with the relevant provisions of the Companies Act, 1956 ("the Act") and the Accounting Standards notified by the Central Government under Companies (Accounting Standard) Rules, 2006/ issued by The Institute of Chartered Accountants of India. The accounting policies adopted in the preparation of financial statements are consistent with the previous year.

3. Non-current Investments

Trade Investments

Investment in Equity Instruments - Unquoted Investment in Subsidiaries & Associates

i. Disputed Customs Duty/Income Tax/Sales Tax demands

The Company has paid Rs. 251.39 lakhs under protest (Previous Year Rs. 495.73 Lakhs), which is included under Long-term loans and advances.

ii. Capital Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is Rs. 2,615.25 Lakhs (Previous Year Rs. 2,575.90 Lakhs).

4. Until November 17, 2008, the Company''s Middle East and Africa (MEA) business was conducted through its wholly owned subsidiary Redington Gulf FZE, Dubai (RGF). To facilitate investment by a Private Overseas Equity Investor in Redington International Holdings Limited (RIHL) a step down subsidiary of the Company, Redington (India) Limited transferred its 100% shareholding in RGF, without consideration, to RIHL.

In the assessment for the year ended March 31, 2009, the Assessing Officer has sought to bring to taxation the imputed profits on transfer of the above shares to RIHL without consideration, leading to a potential demand of Rs. 138 Or excluding interest. The Company has made a representation on this to the Dispute Resolution Panel.

Management is hopeful of successfully contesting in appeal if and when a demand is raised.

5. Operating Leases

The Company has taken cancelable operating lease for its office premises, which are for a period ranging from 11 months to 9 years.

6. Accounting for Financial Instruments

Pursuant to the announcement of the Institute of Chartered Accountants of India (ICAI) in respect of "Accounting for Derivatives", the Company had opted to follow the recognition and measurement principles relating to derivatives as specified in AS 30 "Financial Instruments, Recognition and Measurement", issued by the ICAI, from the year ended March 31, 2008.

Consequently, as of March 31, 2013, the Company has recognised Mark to Market (MTM) loss of Rs. 0.54 lakhs. (Previous Year gain of Rs. 17.52 lakhs) relating to forward contracts and other derivatives entered into to hedge the foreign currency risk of highly probable forecast transactions that are designated as effective cash flow hedges, in the Hedge Accounting Reserve as part of the Shareholders Funds.

The MTM net loss on undesignated / ineffective forward contracts amounting to Rs. 5.65 Lakhs (Previous Year Rs. Nil) has been recognised in the Statement of Profit and Loss.

7. Related party disclosures

1) Key Management Personnel

Mr. R.Srinivasan, Managing Director Mr. Raj Shankar, Deputy Managing Director Mr. M.Raghunandan, Wholetime Director

Refer Note 29 for remuneration

2) Names of the related parties

Party where the Company has control Redington Employee Share Purchase Trust *

Parties having Significant Influence on the Company

Redington (Mauritius) Limited, Mauritius * Synnex Mauritius Limited, Mauritius *

Subsidiary Companies Nook Micro Distribution Limited, India *

Cadensworth (India) Limited, India *

Easyaccess Financial Services Limited, India *

Redington International Mauritius Limited, Mauritius*

Redington International (Holdings) Limited, Cayman Islands

Redington Gulf FZE, Dubai

Cadensworth FZE, Dubai

Redington Gulf & Co. LLC, Oman

Redington Nigeria Ltd, Nigeria

Redington Egypt Ltd, Egypt

Redington Kenya Ltd, Kenya

Redington Middle East LLC, Dubai

Redington Gatar WLL, Qatar

Redington Arabia Limited, Saudi Arabia

Redington Africa Distribution FZE. Dubai

Redington Bahrain SPC, Bahrain

Redington Distribution Pte Ltd, Singapore *

Redington Bangladesh Limited, Bangladesh

Redington Qatar Distribution WLL, Qatar

Redington Kenya (EPZ) Ltd., Kenya

Redington Limited, Ghana

Redington Uganda Limited, Uganda

Africa Joint Technical Services, Libya

RGF Private Trust Company Limited, Cayman Islands

Redington Gulf FZE Co, Iraq

Cadensworth United Arab Emirates LLC, Dubai

Subsidiary Companies Redington Morocco Limited, Morocco

Redington Tanzania Ltd., Tanzania

Redington SL Pvt Limted, Sri lanka

Redington Angola ADA, Angola

Redington Turkey Holdings S.A.R.L, Luxembourg

Arena Bilgisayar Sanayi Ve Ticaret Anonim Sirketi, Turkey*

Arena International FZE, UAE

Ensure IT Services (PTY) Limited, South Africa (Formerly known as Redington IT Services (PTY) Limited)

Subsidiary Companies Formed during the year

ProConnect Supply Chain Solutions Limited, India*

Ensure Gulf FZE, Dubai

Ensure Technical Service (PTY) Limited, South Africa Ensure Middle East Trading LLC,UAE Ensure Technical Services Kenya Limited, Kenya Ensure Technical Services Tanzania Limited, Tanzania Ensure Services Uganda Limited, Uganda Ensure Solutions Nigeria Limited, Nigeria Redington Rwanda Limited, Rwanda Redington Kazakhstan LLP, Kazakhstan Republic

Sensonet Teknoloji Elelektronik Ve Bilisim Hizmetlen Sanayi- Ve Ticaret Limited Sirketi, Turkey

Associate Redington (India) Investments Limited, India*

Subsidiary of Associate Currents Technology Retail (India) Limited, India*

* Represents related parties with whom transactions have taken place during the year.

* As Redington Turkey Holdings S.A.R.L. has effective control over the composition of Board of directors, Arena Bilgisayar Sanayi Ve Ticaret Anonim Sirketi is considered as subsidiary.

8. The figures of the previous year have been regrouped wherever necessary to conform to the classification of the current year.


Mar 31, 2012

1. Company Overview

Redington (India) Limited, is a public limited Company domiciled in India and incorporated under the provisions of the Companies Act, 1956. The Company's stocks are listed on the bourses of Bombay stock exchange and National stock exchange of India. The Company primarily operates in the distribution business and after sales service of Information Technology and other products. The Company and its subsidiaries operate in India, South Asia, Middle East Africa and Turkey.

2. Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention on accrual basis and in accordance with Generally Accepted Accounting Principles in India (Indian GAAP). These financial statements comply with the relevant provisions of the Companies Act, 1956 (the Act) and the Accounting Standards notified by the Central Government under Companies (Accounting Standard) Rules, 2006. The accounting policies adopted in the preparation of financial statements are consistent with the previous year.

The Company has paid Rs 495.73 lakhs under protest (Previous Year Rs 631.23 Lakhs), which is included under Long- term loans and advances.

i. Capital Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is Rs 2,575.90 Lakhs (Previous Year Rs 406.34 Lakhs).

3. Operating Leases

The Company has taken cancelable operating lease for its office premises, which are for a period ranging from 11 months to 9 years.

4. Segment Reporting

The Company primarily operates in distribution business and after sales services of IT and other products and as the revenue from service segment is less than 10% of the total revenue, there are no reportable segments as required to be disclosed under the Accounting Standard 17 "Segment Reporting". Although the Company's operations cover various States in India, the State laws have no significant impact on profitability. Accordingly there are no geographical segments to be reported.

5. Accounting for Financial Instruments

Pursuant to the announcement of the Institute of Chartered Accountants of India (ICAI) in respect of "Accounting for Derivatives", the Company had opted to follow the recognition and measurement principles relating to derivatives as specified in AS 30 "Financial Instruments, Recognition and Measurement", issued by the ICAI, and from the year ended 31 March 2008.

Consequently, as of 31 March 2012, the Company has recognised Mark to Market (MTM) Gain of Rs 17.52 lakhs. (Previous Year loss of t 2.09 lakhs) relating to forward contracts and other derivatives entered into to hedge the foreign currency risk of highly probable forecast transactions that are designated as effective cash flow hedges, in the Hedge Reserve Account as part of the Shareholders Funds.

The MTM net loss on undesignated / ineffective forward contracts amounting to Rs Nil (Previous Year 1111.55 lakhs) has been recognised in the Statement of Profit and Loss.

The Contracts in Hedge Reserve Account are expected to be recognised in the Statement of Profit and Loss on occurrence of transactions which are expected to take place over the next 12 months.

6. Related party disclosures

1) Key Management Personnel

Mr. R.Srinivasan, Managing Director Mr. Raj Shankar, Deputy Managing Director Mr. M.Raghunandan, Wholetime Director Refer below Note 30 for remuneration

A. Stock price

The closing market price on the date prior to the date of grant on National Stock Exchange (NSE) has been considered for the purpose of option valuation.

B. Volatility

Volatility is a measure of the amount by which a price has fluctuated or is expected to fluctuate during a period. The measure of volatility used in the Black-Scholes option-pricing model is the annualized standard deviation of the continuously compounded rates of return on the stock over a period of time.

The period to be considered for volatility has to be adequate to represent a consistent trend in the price movements. It is also important that movements due to abnormal events get evened out.

There is no research that demonstrates conclusively how long the historical period used to estimate expected long- term future volatility should be. However, Guidance note on Accounting for Employee Share-based Payments issued by the Institute of Chartered Accountants of India recommends including the historical volatility of the stock over the most recent period that is generally commensurate with the expected life of the option being valued.

The entity's stocks have been publicly traded on NSE and BSE. For calculating Volatility, we have considered the daily volatility of the stock prices on NSE, over a period prior to the date of grant, corresponding with the expected life of the options.

The Fair value of an option is very sensitive to this variable. Higher the volatility, higher is the Fair value. The rationale being, the more volatile a stock is, the more is its potential to go up (or come down), and the more is the probability to gain from the movement in the price. Accordingly, an option to buy a highly volatile stock is more valuable than the one to buy a less volatile stock, for the probability of gaining is lesser in the latter case.

C. Risk free interest rate

The risk-free interest rate being considered for the calculation is the interest rate applicable for maturity equal to the expected life of the options based on the zero-coupon yield curve for Government Securities.

D. Exercise Price

Options have been granted primarily at a price of Rs 348.05 on 29th February 2008. Subsequently, 19,59,830 and 75,000 options were re-priced at a Market price of 1130/- and 1165/- on 28th January 2009 and 22nd May 2009 respectively. On December 5, 2011 1,73,212 options were granted at a price of Rs 396.50 per option.

E. Time to Maturity / Expected Life of options

Time to Maturity / Expected Life of options is the period for which the Company expects the options to be live. The minimum life of a stock option is the minimum period before which the options cannot be exercised and the maximum life is the period after which the options cannot be exercised.

According to SEBI Guidelines, the expected life of an award of stock options shall take into account the following factors -

i. The expected life must at least include the vesting period.

ii. The average lengths of time of similar grants have remained outstanding in the past. If the Company does not have a sufficiently long history of stock option grants, the experience of an appropriately comparable peer group may be taken into consideration.

iii. The expected life of stock options should not be less than half of the exercise period of the stock options issued until and unless the same is supported by historical evidences with respect to stock options issued by the Company earlier.

The fair value of each award has been determined based on different expected lives of the options that vest each year, as it would be if the award were viewed as several separate awards, each with a different vesting date. A weighted average of all vests has been calculated to arrive at the value of the options.

The time to maturity has been estimated as illustrated by the following example. In case of the grant made on December 5, 2011, the earliest date of exercise is December 5, 2012 i.e. one year from the date of grant. The exercise period is five years from the date of vest.

Hence, the time to maturity for the first vest is equal to the average of the minimum period plus the maximum period i.e. 1 year 6 Years = 3.5 years. Time to Maturity has been estimated on a similar basis for the remaining vests.

Expected Dividend yield: Expected dividend yield has been calculated as an average of dividend yields for the preceding 2 years to the year of grant.

The impact on the profit of the Company as at the year end and the basic and diluted earnings per share, had the Company followed the fair value method of accounting for stock options is set out below:


Mar 31, 2011

1. Contingent Liabilities

(Rs. in Lakhs)

Particulars As at March 31, 2011 As at March 31, 2010

1. Guarantees by banks on behalf of the Company 2,587.15 281.10

2. Corporate Guarantees outstanding On behalf of subsidiaries 39,484.08 48,060.62

Others 321.68 321.68

3. Bills Discounted 7,347.12 2,614.30

4. Factoring 5,750.00 4,625.00

5. Claims against Company not acknowledged as debts 563.63 159.53

6. The Company has in addition to above issued letters of comfort/ awareness to banks for the facilities granted to its subsidiaries.

2. Capital Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for, (net of advances) is Rs. 406.34 Lakhs (P.Y. Rs..9.72 Lakhs). (Note No. 2(i) in the notes to accounts of the financial statements)

3. Events occurring after the balance sheet date

i. After March 31, 2011, equity shares of Rs..2/- each fully paid up were issued and allotted pursuant to the exercise of stock options under Employee Stock Option Plan 2008.

Date of allotment No of Shares

April 12, 2011 5,15,815

April 30, 2011 5,12,910

ii. Corporate guarantees amounting to Rs. 6,205.60 Lakhs expired which are issued on behalf of step down subsidiaries.

iii. The company has issued corporate guarantee on behalf of its wholly owned subsidiary amounting to Rs. 2,210.75 Lakhs. (Note No. 2(q) in the notes to accounts of the financial statements)

4. Accounting for Financial Instruments

The Company has recognized Mark to Market (MTM) Losses of Rs.. 2.09 Lakhs (P.Year Rs..184.77 Lakhs) relating to forward contracts entered into to hedge the foreign currency risk of highly probable transactions that are designated as effective cash flow hedges, in the Hedge Reserve Account. The company has not entered into any speculative/other derivative transaction.

5. Related Parties

1) Key Management Personnel

Mr. R.Srinivasan, Managing Director

Mr. Raj Shankar, Deputy Managing Director

Mr. M.Raghunandan, Wholetime Director

2) Names of the related parties

Party where control exists

Redington Employee Share Purchase Trust*

Parties having Significant Influence

Redington (Mauritius) Limited, Mauritius* Synnex Mauritius Limited, Mauritius*

Subsidiary Companies

Nook Micro Distribution Limited, India *

Redington (India) Investments Private Limited, India

Cadensworth (India) Limited, India*

Easyaccess Financial Services Limited, India*

Redington International Mauritius Limited, Mauritius

Redington International (Holdings) Limited, Cayman Islands

Redington Gulf FZE, Dubai*

Cadensworth FZE, Dubai*

Redington Gulf & Co. LLC, Oman

Redington Nigeria Ltd, Nigeria

Redington Egypt Ltd, Egypt

Subsidiary Companies

Redington Kenya Ltd, Kenya

Redington Middle East LLC, Dubai

Redington Qatar WLL, Qatar

Redington Arabia Limited, Saudi Arabia

Redington Africa Distribution FZE. Dubai

Redington Bahrain SPC, Bahrain

Redington Distribution Pte Ltd, Singapore *

Redington Bangladesh Limited, Bangladesh

Redington Qatar Distribution WLL, Qatar

Redington Kenya (EPZ) Ltd., Kenya

Redington Limited, Ghana

Redington Uganda Limited, Uganda

Africa Joint Technical Services, Libya

RGF Private Trust Company Limited, Cayman Islands

Cadensworth United Arab Emirates LLC, Dubai

Redington Morocco Limited, Morocco.

Redington Tanzania Ltd., Tanzania

Redington SL Pvt Limted, Sri lanka

Redington Angola ADA

Redington Turkey Holdings S.A.R.L

Arena Bilgisayar Sanayi Ve Ticaret Anonim Sirketi, Turkey#

* Represents companies with whom transactions have taken place during the year.

# As Redington Turkey Holdings S.A.R.L. has effective control over the composition of Board of directors Arena is considered as subsidiary

Assumptions:

Stock Price: The stock price of the Company is the closing price of the Company's equity share on the NSE on the day prior to the date of grant

Volatility: Volatility is a measure of the amount by which a price has fluctuated or is expected to fluctuate during a period. The measure of volatility used in the Black-Scholes option-pricing model is the annualized standard deviation of the continuously compounded rates of return on the stock over a period of time. The period to be considered for volatility has to be adequate to represent a consistent trend in the price movements. It is also important that movements due to abnormal events get evened out. The entity's stocks have been publicly traded from February 15, 2007 on NSE & BSE.

Exercise Price: Options have been granted primarily at a price of Rs..348.05 on 29th February 2008. Subsequently, 19,59,830 and 75,000 options were re-priced at a Market price of Rs.. 130/- and Rs.. 165/- on 28th January 2009 and 22nd May 2009 respectively.

Risk free interest rate: The risk-free interest rate being considered for the calculation is the interest rate applicable for maturity equal to the expected life of the options based on the zero-coupon yield curve for Government Securities.

Time of Maturity: Time to Maturity / Expected life of options is the period for which the Company expects the options to be live. The minimum life of stock option is the minimum period before which the options cannot be exercised and the maximum life is the period after which the options cannot be exercised. The fair value of each award has been determined based on different expected lives of the options that vest each year, as if the award were separate awards, each with a different vesting date. A weighted average of 3 vests has been calculated to arrive at the value of the options granted.

Expected Dividend yield: Expected dividend yield has been calculated as an average of dividend yields for the preceding 2 years to the year of grant.

6. Ratios

(i) Sales to total assets ratio – 3.48 Times (Previous Year - 3.78 Times)

(ii) Operating Profit / Closing Capital Employed – 18.49% (Previous Year – 17.71%)

(iii) Return on Closing Net worth – 16.81% (Previous Year – 14.71%)

(iv) Profit to sales ratio – 1.54% (Previous Year – 1.54%)

7. Previous year figures have been regrouped wherever necessary to conform to the current year's classification.

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