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Notes to Accounts of Redington Ltd.

Mar 31, 2023

39. CONTINGENCIES AND COMMITMENTS		'' in Crores
Particulars	2022-23	2021-22
a. Claims against the Company not acknowledged as debts b. Disputed tax demands	9.51	6.62
Direct tax	0.43	0.43
Indirect taxes	121.05	121.58

Other than the information disclosed above, the Company is involved in disputes, proceedings etc. that arose from time to time in the ordinary course of business. The Company is of the view that there would be no material adverse effect, arising out of such disputes/proceedings, on the standalone financial statements. Show cause notices are not considered as contingent liabilities unless converted into demand.

c. Capital commitments

Estimated value of contracts remaining to be executed on capital account and not provided for (net of advances) is ''6.44 Crores (previous year: ''36.96 Crores).

Leases as a lessor Operating leases

The Company leases out certain assets and has classified these leases as operating leases, because they do not transfer substantially all of the risks and rewards incidental to the ownership of the assets. Rental income recognised by the Company during year ended March 31,2023 was ''4.69 Crores (March 31,2022: ''4.26 Crores). The rental income pertaining to Investment Property, which was subsequently transferred to asset held for sale during the year, amounting to ''4.25 Crores (March 31,2022: ''4.25 Crores) is disclosed as part of other operating revenue under Revenue from operations (Refer note 32) and other rental income amounting to ''0.44 Crores (March 31,2022: ''0.01 Crores) is disclosed as rental income under Other income (Refer note 33). Depreciation expense incurred towards such investment property is disclosed as part of depreciation and amortisation expense (refer note 36). The following table sets out a maturity analysis of lease payments, showing the undiscounted lease payments to be received after the reporting date:

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Such changes in the values of financial instruments may result from changes in the foreign currency exchange rates, interest rates, credit, liquidity, and other market changes. The Company''s exposure to market risk is primarily on account of foreign currency risk.

a. Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates is primary on account of payment in foreign exchange for purchase of goods.

The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions.

The Company''s activities expose it to a variety of financial risks such as foreign exchange risk, interest rate risk, credit risk and liquidity risk. The Company''s focus is to foresee the unpredictability of financial markets and seek to minimise potential adverse effects on its financial performance. The primary market risk of the Company is credit and foreign exchange risk.

The Company''s senior management oversees the management of these risks. The Company''s senior management is supported by a financial risk committee that advises on financial risks and the appropriate financial risk governance framework for the Company. The financial risk committee provides assurance to the Company''s senior management that the Company''s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured, mitigated and managed in accordance with the Company''s policies and risk objectives.

The un-hedged balances as at the reporting dates are primarily on account of purchase of goods where the Company is in the process of hedging and the balance in vendor account which to a larger extent have natural hedge.

Sensitivity analysis

Sensitivity analysis is carried out for un-hedged foreign exchange risk as at the reporting dates. For every 1% strengthening of Indian Rupees against all relevant uncovered foreign currency transactions profit before tax would be impacted by gain of ''1.24 Crores (previous year gain of ''0.40 Crores). Similarly, for every 1% weakening of Indian Rupee against these transactions, there would be an equal and opposite impact on the profit before tax.

b. Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates.

The Company borrows funds to meet its short-term requirements which are at fixed interest rates. Hence, the Company is not exposed to any significant interest rate risk.

c. Credit risk

Credit risk is a risk of financial loss to the Company, if a customer or counterparty to a financial instrument fails to meet its contractual obligations, arises principally from the Company''s receivables from customers, loans, and other financial assets. The carrying value of financial assets represents the maximum amount of credit risk.

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. Credit insurance is resorted to most of the receivable and in such cases the credit risk is restricted to 15 % of the receivable value.

The concentration of credit risk is limited due to the customer base being large and unrelated. Further, the Company constantly evaluates the quality of trade receivable and provides allowance towards impairment of trade receivables.

I n addition to the historical pattern of credit loss, the Company closely monitors its customers and assesses conditions such as change in payment terms, inability of the customer to pay etc. depending on severity of each case. Basis this assessment, the allowance for impairment of trade receivables as at the reporting dates is considered adequate.

d. Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset.

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

c. Debt service coverage ratio = (Profit before tax - Dividend income Finance cost) / (Finance cost Repayment of longterm loans during the year)

d. I nventory turnover ratio = (Purchase of traded goods Changes in inventories of traded goods)/ Average inventories

e. Trade receivables turnover ratio = Revenue from operations/ Average trade receivables

f. Trade payables turnover ratio = (Purchase of traded goods Changes in inventories of traded goods)/ Average trade payables

g. Net capital turnover ratio = Revenue from operations/ (Average inventories Average trade receivables - Average trade payables)

h. Net profit % = (Net profit after tax - Dividend income

- Tax expenses in respect of earlier years)/ Revenue from operations

i. Return on equity % = Profit after tax/ (Average equity -Investments in subsidiaries)

j. Return on capital employed (Net of cash) % = (Profit before tax Finance costs)/ (Average capital employed

- Investment in subsidiaries - cash and cash equivalents) where Capital employed = Equity Borrowings.

k. Return on capital employed (Gross) % = (Profit before tax Finance costs)/ (Average capital employed - Investment in subsidiaries)

l. Return on investment % = Income generated from invested funds/ Average invested funds in treasury investments.

As per Section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. A CSR committee has been formed by the company as per the Act. The CSR funds were primarily utilised throughout the year on activities which are specified in Schedule VII of the Companies Act, 2013 through the ''Foundation for CSR @ Redington'' trust formed to carry out the Company''s CSR activities.

47. SEGMENT REPORTING

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

48. STOCK APPRECIATION RIGHTS

Details of Stock Appreciation Rights

The Company had formulated ''Redington Stock Appreciation Right Scheme 2017'' ("SAR Scheme 2017") with an intent to reward the employees of the Company and its subsidiaries for their performance and to motivate them to contribute to the growth and profitability of the Company. The maximum number of shares to be issued against the Stock Appreciation Rights (SARs) shall not exceed 86,81,681 equity shares of ''2/- each as adjusted for any changes in the capital structure of the Company. Pursuant to the approval of SAR Scheme 2017 by the members of the Company, the Nomination and Remuneration Committee of the Board of Redington Limited on December 30, 2017 approved the grant of 81,79,000 SARs to the employees of the Company and its subsidiaries.

Each SAR entitles the eligible employees and directors to receive equity shares of the Company equivalent to the increase in value of one equity share (''Appreciation''). Appreciation is calculated by reducing the issue price / base price from the reported closing price of the equity shares in the NSE / BSE where there is highest trading, on the day prior to the date of exercising of these SARs and multiplying the resultant with the number of SARs exercised.

These SARs vest over a period of 3 years from the date of the grant in the following manner:

10% of the SARs vest after a period of one year from the grant date, 20% of the SARs vest after a period of two years from the grant date and 70% of the SARs vest after a period of three years from the grant date. These SARs are exercisable within a period of three years from the respective date of vesting.

Certain SARs granted to the members of senior management team as identified by the Nomination and Remuneration committee have an associated performance condition. Of the total SARs granted to senior management team, 35% of the SARs that would vest at the end of 3 years from the date of the grant are subject to the performance conditions. As the Company has not met the performance condition, all the performance linked SAR lapsed during the previous year. The Company has used the Black-Scholes Option Pricing Model to determine the fair value of the SARs based on which the compensation cost for the previous year has been computed.

The variables / assumptions used at the time of the grant for calculating the fair value using the above model and their rationale are as follows:

i. Stock price

The closing market price of the Company''s share on the date prior to the date of grant as quoted on the National Stock Exchange (NSE) has been considered for the purposes of right valuation.

ii. Volatility

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

In determining volatility, the Company considers the historical volatility of the stock over the most recent period that is generally commensurate with the expected life of the right being valued. Volatility has been calculated based on the daily closing market price of the Company''s stock price on NSE over these years.

is the minimum period before which the SAR cannot be exercised. The maximum life is the period after which the SAR cannot be exercised.

The expected life of rights is calculated as the average of the minimum life (vesting period) and the maximum life (i.e. vesting period exercise period).

vi. Expected dividend yield

Expected dividend yield has been calculated based on the final dividend declared during the preceding financial year.

iii. Risk free interest rate

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

iv. Exercise / base price

Exercise / base price of ''148.50 is considered in the original valuation.

v. Expected Life of SARâs

Expected Life of SAR is the period over which the Company expects the SAR to be exercised. The minimum life of SAR

f. Expense recognised in Statement of profit and loss

The Company has recognised costs with respect to those SARs which were issued to the employees and directors of the Company in the statement of profit and loss under employee benefit expenses.

g. Amount recognised as cost of investments in subsidiaries

The Company has recognised the cost of those SARs which were issued to the employees and directors of the subsidiaries as the cost of investments.

51. OTHER MATTERS

The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions made by the company towards Provident fund and gratuity. The Ministry of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under active consideration by the Ministry. The Company will assess and give appropriate impact in its financial statements in the period in which the Code becomes effective and the related rules are published.

52. EVENTS AFTER THE REPORTING PERIOD

a) The Board has recommended dividend of ''7.20 (360%) per equity share of ''2/- each for the year ended March 31,2023, subject to the approval of shareholders of the company at the ensuing Annual General Meeting (''AGM''). The dividend will be paid within 30 days from the date of the ensuing AGM of the Company. The Record date for payment of dividend, as recommended by the Board, is fixed as Friday, July 7, 2023.

b) Subsequent to the year ended March 31, 2023, the company transferred ADC (Automated Distribution Centre) at Chennai to Proconnect Supply Chain Solutions Limited, a wholly owned subsidiary of the Company on April 26,2023 for ''39.50 Crores (Includes Land, Building & other assets).

52. These standalone financial statements were approved for issue by the Board of Directors on May 16, 2023.

50. ADDITIONAL REGULATORY INFORMATION

The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall: (a) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or (b) Provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries II The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall: (a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or (b) provide any guarantee, security or the like on behalf of the ultimate beneficiaries

Mar 31, 2022

Financial risk management

The Company''s activities expose it to a variety of financial risks such as foreign exchange risk, interest rate risk, credit risk and liquidity risk. The Company''s focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. The primary market risk of the Company is credit and foreign exchange risk.

objectives.

a. Foreign currency risk

Sensitivity analysis

Sensitivity analysis is carried out for un-hedged foreign exchange risk as at the reporting dates. For every 1% strengthening of Indian Rupees against all relevant uncovered foreign currency transactions profit before tax would be impacted by gain of '' 0.40 Crores (previous year gain of '' 0.18 Crores). Similarly, for every 1% weakening of Indian Rupee against these transactions, there would be an equal and opposite impact on the profit before tax.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates.

The Company borrows funds to meet its short-term requirements which are at fixed interest rates and the Company''s borrowings are minimal. Hence, the Company is not exposed to any significant interest rate risk.

Credit risk

The Company mitigates credit risk by strict receivable management, procedures and policies. The Company has a

All the above ratios have been computed after eliminating one-offs

such as dividend income and tax expenses in respect of earlier years.

Formulas for above ratios:

a. Current ratio = Current assets/ current liabilities

b. Debt equity ratio = (Total Debt - Cash and cash equivalents)/ (Total equity - Investments in subsidiaries)

c. Debt service coverage ratio = (Profit before tax - Dividend income Finance cost) / (Finance cost Repayment of long-term loans during the year)

d. Inventory turnover ratio = (Purchase of traded goods Changes in inventories of traded goods)/ Average inventories

e. Trade receivables turnover ratio = Revenue from operations/ Average trade receivables

f. Trade payables turnover ratio = (Purchase of traded goods Changes in inventories of traded goods)/ Average trade payables

g. Net capital turnover ratio = Revenue from operations/ (Average inventories Average trade receivables - Average trade payables)

dedicated independent team to review credit and monitor collection of receivables on a pan India basis. Credit insurance is resorted to most of the receivable and in such cases the credit risk is restricted to 15 % of the receivable value.

In addition to the historical pattern of credit loss, the Company has considered the likelihood of increased credit risk and consequential default considering emerging situations due to COVID-19. The Company closely monitors its customers and assesses conditions such as change in payment terms, inability of the customer to pay etc. depending on severity of each case. Basis this assessment, the allowance for impairment of trade receivables as at the reporting dates is considered adequate.

d. Liquidity risk

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 un-availed borrowing facilities, by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial liabilities.

The following table details the Company''s remaining contractual maturity for its non-derivative financial liabilities:

h. Net profit % = (Net profit after tax - Dividend income - Tax expenses in respect of earlier years)/ Revenue from operations

i. Return on equity % = Profit after tax/ (Average equity -Investments in subsidiaries)

j. Return on capital employed (Net of cash) % = (Profit before tax Finance costs)/ (Average capital employed - Investment in subsidiaries - cash and cash equivalents) where Capital employed = Equity Borrowings.

k. Return on capital employed (Gross) % = (Profit before tax Finance costs)/ (Average capital employed - Investment in subsidiaries)

l. Return on investment % = Income generated from invested funds/ Average invested funds in treasury investments.

43. Related party disclosures (As per Ind AS 24 âRelated party disclosures")

a. Key Management Personnel (KMP)

Mr. Raj Shankar, Vice Chairman and Managing Director *

Mr. Rajiv Srivastava, Joint Managing Director (Appointed w.e.f. April 2, 2021) *

Mr. S V Krishnan, Global Chief Financial Officer & Whole Time Director (Redesignated from Chief Financial Officer & Whole Time Director w.e.f. February 8, 2022)

Mr. Ramesh Natarajan, Chief Executive Officer, India Distribution business

Mr. V Ravishankar, Chief Financial Officer (Appointed w.e.f. February 8, 2022)

Refer note 44 for details of remuneration paid to KMP.

*Mr. Rajiv Srivastava was appointed as an additional director and has been redesignated as Managing Director w.e.f. from April 1, 2022, and consequently, Mr. Raj Shankar continued as Vice Chairman of the Company until his resignation. (Refer note 50 (b)).

47. Stock Appreciation Rights

Details of Stock Appreciation Rights

The Company had formulated ''Redington Stock Appreciation Right Scheme 2017'' ("SAR Scheme 2017") with an intent to reward the employees of the Company and its subsidiaries for their performance and to motivate them to contribute to the growth and profitability of the Company. The maximum number of shares to be issued against the Stock Appreciation Rights (SARs) shall not exceed 86,81,681 equity shares of '' 2/- each as adjusted for any changes in the capital structure of the Company. Pursuant to the approval of SAR Scheme 2017 by the members of the Company, the Nomination and Remuneration Committee of the Board of Redington (India) Limited on December 30, 2017 approved the grant of 81,79,000 SARs to the employees of the Company and its subsidiaries.

These SARs vest over a period of 3 years from the date of the grant in the following manner:

The said SAR Scheme is in compliance with the provisions of Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014.

Chairman and Non-Executive Director" of the Company. The Board also took note of the intimation about the resignation of Mr. Raj Shankar from the subsidiaries in which he held directorship.

The variables / assumptions used at the time of the grant for calculating the fair value using the above model and their rationale are as follows:

i. Stock price

The closing market price of the Company''s share on the date prior to the date of grant as quoted on the National Stock Exchange (NSE) has been considered for the purposes of right valuation.

ii. Volatility

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

iii. Risk free interest rate

iv. Exercise / base price

Exercise / base price of '' 148.50 is considered in the original valuation.

v. Expected Life of SAR''s

Expected Life of SAR is the period over which the Company expects the SAR to be exercised. The minimum life of SAR is the minimum period before which the SAR cannot be exercised. The maximum life is the period after which the SAR cannot be exercised.

The expected life of rights is calculated as the average of the minimum life (vesting period) and the maximum life (i.e. vesting period exercise period).

vi. Expected dividend yield

Expected dividend yield has been calculated based on the final dividend declared during the preceding financial year.

f. Expense recognised in Statement of profit and loss

The Company has recognised costs with respect to those SARs which were issued to the employees and directors of the Company in the statement of profit and loss under employee benefit expenses.

g. Amount recognised as cost of investments in subsidiaries

The Company has recognised the cost of those SARs which were issued to the employees and directors of the subsidiaries as the cost of investments.

48. The Income tax department had raised a demand during financial year 2013-14 on the Company for '' 118.65 Crores (excluding

interest and penalty) arising on account of tax on capital gains from the transfer of the Company''s investment in an overseas subsidiary to another overseas step-down subsidiary, for the year ended March 31, 2009. This demand was set aside by the Income Tax Appellate Tribunal, Chennai vide its order dated July 7, 2014. The Department filed an appeal against the said order before the Hon''ble Madras High Court ("The Court"). In August 2019, the Court allowed admission of the appeal and the Company was actively contesting the same.

During financial year 2020-21, the Company received an unfavourable order from the Court in respect of the same, setting aside the order of the Income-tax Appellate Tribunal, resulting in a potential demand of '' 140.29 Crores (excluding interest and penalty).

Pursuant to receipt of such order, the Company performed a comprehensive evaluation of its various direct tax positions including the status of its pending litigations and the Company, in respect of certain assessment years (including AY 200910), made applications under Vivad Se Vishwas (VSV) scheme during the previous year. The Company availed the scheme after evaluating the pros and cons of continuing with the litigations and the benefit of wavier of interest and penalty that the scheme offered.

In view of the above, the Company recorded a provision of '' 88.99 crores towards income-tax in respect of earlier years which was disclosed separately under the head tax expenses, for the year ended March 31, 2021. The Company made necessary payments for all assessment years, in respect of which VSV applications were filed. During the year the Company received orders for full and final settlement under Direct tax Vivad Se Vishwas Act, 2020 for all assessment years. Consequential orders for closure of disputes under Income Tax Act are awaited.

49. Other matters

50. Events after the reporting period

a. The Board of Directors at its meeting held on May 21, 2022, has recommended a dividend of '' 6.60 /- per equity share of '' 2/- each (i.e. 330% of face value) for the financial year ended March 31, 2022 subject to the approval of shareholders in the ensuing Annual General Meeting.

b. The Board of Directors at its meeting held on May 21, 2022, has taken note of the resignation of Mr. Raj Shankar as "Vice

51. These standalone financial statements were approved for issue by the Board of Directors on May 21, 2022.

Mar 31, 2019

1. Company overview

Redington (India) Limited (âthe Companyâ), is a public limited Company domiciledin India, incorporated underthe provisions of the Companies Act, 1956 and has its registered office at SPL Guindy House, 95, Mount Road, Guindy, Chennai -600032, Tamil Nadu, India. The Companyâs equity shares are listed on the bourses of BSE Limited and National Stock Exchange of India Limited. The Company is engaged in the business of distribution of information technology, mobility and other technology products besides supply chain solutions and after sales services. The Company has an operating branch in Singapore. The Company, its subsidiaries and associate operates in India, Middle East, Turkey, Africa, and South Asian countries.

2. Basis of preparation of standalone financial statements

2. a. Statement of compliance

The standalone financial statements of the Company have been prepared in accordance with the Indian Accounting Standards (Ind AS) to comply with the requirements prescribed under section 133 of the Companies Act, 2013 (âthe Actâ) read with the Companies (Indian Accounting Standards) Rules, 2015, as amended from time to time.

2. b. Functional currency and presentation currency

The standalone financial statements are presented in âIndian Rupeesâ (INR), which is the currency of the primary economic environment in which the Company operates (the functional currency). The functional currency of the Companyâs branch in Singapore is United States Dollar (USD). All financial information has been rounded-off to the nearest Crores, unless otherwise indicated.

2. c. Basis of measurement

The standalone financial statements have been prepared on accrual basis under the historical cost convention except for:

2. d. Use of Estimates and judgements

The preparation of the standalone financial statements in conformity with Ind AS requires the management to make estimates, judgements and assumptions considered in the reported amount of assets, liabilities (including contingent assets and contingent liabilities), the reported income and the expenses during the year.

The management believes that these estimates, judgements and assumptions used in the preparation of the standalone financial statements are prudent and reasonable.

Future results could differ from these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known / materialise. Estimates, judgements and underlying assumptions are reviewed on an ongoing basis.

Key sources of judgement and estimation uncertainties at the date of the financial statements, which may cause a material adjustment to income and expenditure or the carrying amounts of assets and liabilities, are in respect of useful lives of property, plant and equipment, income taxes, stock appreciation rights, inventory obsolescence, original equipment manufacturer (âOEMâ) supplier programs and expected credit losses and have been discussed here.

i) Useful lives of property, plant and equipment

The cost of property, plant and equipment is depreciated over the estimated useful life, which is based on technical evaluation made by the Company considering various factors including expected usage of the asset, expected physical wear and tear, the repair and maintenance program and technological obsolescence arising from changes and the residual value.

ii) Taxation

Significant judgements are involved in determining the provision for income taxes. Judgments are also involved on whether the tax positions are probable of being sustained in tax assessments.

iii) Stock appreciation rights

Compensation costs in respect of stock appreciation rights (SAR) granted during the previous year have been determined using the Black Scholes option valuation model. The said model requires the Company to input certain assumptions / variables to determine the fair value of the SAR granted. The Company has applied appropriate levels of judgements in determining these assumption / variables basis the information available as at the date of grant, the details of which are more fully described in note 43.

iv) Inventory obsolescence

Inventories are measured at the lower of cost and the net realizable value (net of price protection rebates). Adjustments to reduce the cost of inventory to its realisable value, if required, are made at the product level. Factors influencing these adjustments include changes in demand, rapid technological changes, product life cycle, product pricing, physical deterioration and quality issues. Revisions to these adjustments would be required if these factors differ from the estimates.

v) Original Equipment Manufacturer ( âOEMâ) supplier programs

OEM suppliers formulate programs for inventory volume promotion programs and price protection rebates. Inventory volume promotion programs and price protection rebates are recorded as a reduction in the cost of purchase of traded goods. The rebates are accrued based on the terms of the program and sales of qualifying products. Some of these programs may extend over one or more quarterly reporting periods. The Company tracks vendor promotional programs for volume discounts on a program-by-program basis. Once the program is implemented, the benefit of the program based on the actual volume is recorded as a receivable from vendors with a corresponding reduction in the cost of purchase of traded goods. Actual rebates may vary based on volume or other sales achievement levels, which could result in an increase or reduction in the estimated amounts previously accrued.

vi) Expected Credit Losses (âECLâ)

The Company creates provision in respect of changes in expected credit losses at each reporting period to reflect changes in credit risk since initial recognition of the financial assets

The Company has adopted a model as permitted under Ind AS 109 for measuring lifetime expected credit loss allowance for trade receivables and other financial assets. Expected Credit Losses is determined as the probability weighted estimate of credit losses based on the historical credit loss experience and adjusted for forward looking information.

2. e. Recent accounting pronouncements

Ministry of Corporate Affairs (âMCAâ) through Companies (Indian Accounting Standards) Amendment Rules, 2018 has notified the following new Ind AS and amendments to Ind ASâs which the Company has not applied in these financial statements as they are effective for annual periods beginning on or after April 1, 2019. The Company plans to apply these standards from their respective applicable dates.

Ind AS 116 - Leases

Ind AS 116 will replace the existing leases standard, Ind AS 17 Leases.

Ind AS 116 sets out the principles for the recognition, measurement, presentation and disclosure of leases for both lessees and lessors. It introduces a single, on-balance sheet lessee accounting model for lessees. A lessee recognises right-of-use asset representing its right to use the underlying asset and a lease liability representing its obligation to make lease payments. The standard also contains enhanced disclosure requirements for lessees. Ind AS 116 substantially carries forward the lessor accounting requirements in Ind AS 17.

The Company is in the process of assessing the impact of Ind AS 116 on its standalone financial statements.

Ind AS 12 Income taxes

Income-tax consequence of distribution of profits (i.e. dividends), including payments on financial instruments classified as equity, should be recognised when a liability to pay dividend is recognised.

The income tax consequence should be recognised in statement of profit and loss, other comprehensive income (OCI) or equity according to where the past transactions or events that generated distributable profits were originally recognised.

Appendix C has been added to Ind AS 12 which provides that the accounting for uncertainties on income tax treatments that are yet to be accepted by tax authorities and to reflect it in the measurement of current and deferred taxes

The Company is in the process of assessing the impact of the above amemtments on its standalone financial statements.

Ind AS 109 - Prepayment Features with Negative Compensation

The amendments relate to the existing requirements in Ind AS 109 regarding termination rights in order to allow measurementatamortisedcost(or,dependingonthebusiness model, at fair value through other comprehensive income) even in the case of negative compensation payments. The Company doesnât expect to have any impact of the amendment on its standalone financial statements.

Ind AS 19 - Plan Amendment, Curtailment or Settlement

The amendments provide that if a defined benefit plan amendment, curtailment or settlement occurs, it is mandatory that the current service cost and the net interest for the period after the re-measurement are determined using the assumptions used for the remeasurement. In addition, amendments have been included to clarify the effect of a plan amendment, curtailment or settlement on the requirements regarding the asset ceiling. The Company doesnât expect to have any impact of the amendment on its standalone financial statements.

Ind AS 23 - Borrowing Costs

The amendments provide that if any specific borrowing remains outstanding after the related asset is ready for its intended use or sale, that borrowing becomes part of the funds that an entity borrows generally when calculating the capitalisation rate on general borrowings. The Company doesnât expect to have any impact of the amendment on its standalone financial statements.

Ind AS 28 - Long-term Interests in Associates and Joint Ventures

The amendments provide that an entity applies Ind AS 109 Financial Instruments, to long-term interests in an associate or joint venture that form part of the net investment in the associate or joint venture but to which the equity method is not applied. The Company doesnât expect to have any impact of the amendment on its standalone financial statements.

Ind AS 103 - Business Combinations and Ind AS 111 - Joint Arrangements

The amendments to Ind AS 103 relating to re-measurement clarify that when an entity obtains control of a business that is a joint operation, it re-measures previously held interests in that business. The amendments to Ind AS 111 clarify that when an entity obtains joint control of a business that is a joint operation, the entity does not re-measure previously held interests in that business. The Company will apply the pronouncement if and when it obtains control / joint control of a business that is a joint operation.

3. Intangible assets under development represents the cost incurred towards the implementation of a new ERP system (SAP), including the cost of license. These cost would be capitalised as intangible assets in the subsequent year on implementation of the new ERP system (SAP).

4. Investment in subsidiaries and associate

Unquoted investments

Stock Appreciation Rights (SARs)

The Company has included fair value of the Stock Appreciation Rights (Stock compensation expense) as Investments, in respect of the Stock Appreciation Rights granted to the Directors and employees of Indian and overseas subsidiaries, as required under Ind AS 102 âShare-based paymentâ.

Unrecognised deferred tax assets

Consequent to the sale of the Companyâs Investment in its wholly owned subsidiary Easyaccess Financial Services Limited in FY 201314 and a land at Delhi in FY 2017-18, there was a Long Term Capital loss, under Income Tax Act,1961, which resulted in deferred tax asset of Rs. 15.39 Crores. Out of this Rs. 2.49 Crores was recognized against realized long term capital Gain in an earlier year. The balance Deferred Tax Asset of Rs. 12.90 Crores will be recognized as and when there is a Long Term capital Gain. These unrecognized deferred tax assets will expire over a period of 3- 7 years.

Particulars of maximum amount of loans and advances outstanding at any time during the year to Subsidiaries and Associate (disclosed pursuant to Regulation 34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015)

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. The dividend proposed by the Board of Directors is subject to the approval of the shareholders at the ensuing Annual General Meeting.

For details of dividends declared subsequent to balance sheet date refer note 46

Equity Share movement during 5 years preceding March 31, 2019

11,120,000 equity shares of Rs. 2 each were extinguished on buy-back by the Company pursuant to a Letter of Offer made to all eligible shareholders of the Company at Rs. 125 per equity share. The equity shares bought back were extinguished on December 7, 2018.

Capital 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 optimisation of the debt and equity balance.

The General reserve is used from time to time to transfer profits from retained earnings for appropriation purpose. As the general reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the general reserve will not be reclassified subsequently to profit or loss.

Capital redemption Reserve is created to the extent of the nominal value of the share capital extinguished on buyback of Companyâs purchases its own shares in accordance with Section 69 of the Companies Act, 2013. The reserve is utilized in accordance with provision of Companies Act, 2013.

Retirement benefit obligation reserve represents accumulated balances of actuarial gains/losses, arising out of employee defined benefit obligation and will not to be subsequently reclassified to Profit and Loss. This reserve is not a distributable reserve.

Exchange differences relating to the translation of the results and net assets of the Companyâs foreign operations from its functional currency to the presentation currency are recognized directly in other comprehensive income and accumulated in the foreign currency translation reserve.

The above reserve relates to SARs granted by the Company to the employees and Directors of the Company and its subsidiaries, under the Redington Stock Appreciation Right Scheme, 2017. Further information about SAR scheme is set out in note 43.

Gratuity (included as part of employee benefits expense in note 29)

The Company provides for gratuity, a defined benefit retirement plan (âthe Gratuity Planâ) covering eligible employees. The Gratuity Plan provides a lump-sum payment to vested employees at retirement, death or termination of employment, of an amount based on the respective employeeâs salary and the tenure of employment with the Company. The Companyâs obligation towards Gratuity is a defined benefit plan and the details of actuarial valuation as at the year-end are given below:

Sensitivity analysis

The Company applies 1% as the sensitivity rate while ascertaining the impact of change in one of the actuarial assumptions, keeping other assumptions constant, on the defined benefit obligation. Following is the effect on defined benefit obligation:

a. Secured by pari-passu charge on inventories and trade receivables and repayable on demand.

b. The facility is unsecured and the maximum amount outstanding at any time during the year was Rs. 1,900.00 Crores (previous year: Rs. 1,390.00 Cores).

The Company has circulated letters to suppliers and based on confirmations received so far from the parties, necessary disclosures relating to Micro and Small Enterprises as defined under the Micro, Small and Medium Enterprises Development Act, 2006 are made in the financial statements in accordance with the Notification No: GSR 719 (E) dated November 16, 2007 issued by the Ministry of Corporate Affairs. There are no overdue outstanding amounts (including interest) payable to these enterprises.

Note A

Includes similar issues for which the Company has received favourable disposition at the Tribunal level in the past.

iv. Capital commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is Rs. 1.88 Crores (previous Year: Rs. 15.57 Crores).

5. Operating leases

The Company has taken various operating leases for its office premises, which is for a period ranging from 8 months to 9 years.

The Company enters into foreign exchange forward contracts with banks. These foreign exchange forward contracts are valued using various inputs including the foreign exchange spot and expected forward rates.

6. Financial risk management

The Companyâs activities expose it to a variety of financial risks such as foreign exchange risk, interest rate risk, credit risk and liquidity risk. The Companyâs focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. The primary market risk of the Company is credit and foreign exchange risk.

The Companyâs senior management oversees the management of these risks. The Companyâs senior management is supported by a financial risk committee that advises on financial risks and the appropriate financial risk governance framework for the Company. The financial risk committee provides assurance to the Companyâs senior management that the Companyâs financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Companyâs policies and risk objectives.

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Such changes in the values of financial instruments may result from changes in the foreign currency exchange rates, interest rates, credit, liquidity and other market changes. The Companyâs exposure to market risk is primarily on account of foreign currency risk

A. Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Companyâs exposure to the risk of changes in foreign exchange rates is primary on account of payment in foreign exchange for purchase of goods.

The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions.

The un-hedged balances as at March 31, 2019 are primarily on account of purchase of goods where the Company is in the process of hedging and the balance in vendor account which to a larger extent have natural hedge.

Sensitivity analysis:

Sensitivity analysis is carried out for un-hedged foreign exchange risk as at March 31, 2019. For every 1% strengthening of Indian Rupees against all relevant uncovered foreign currency transactions profit before tax would be impacted by loss of Rs. 0.87 Crores ( previous year Rs. 1.10 Crores). Similarly, for every 1% weakening of Indian Rupee against these transactions, there would be an equal and opposite impact on the profit before tax.

B. Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates.

The Company borrows funds to meet its short-term requirements which are at fixed interest rates. Hence, the Company is not exposed to any significant interest rate risk.

C. Credit risk

Credit risk is the risk that the counterparty will not meet its obligations under customer contract, leading to a financial loss. The Company is exposed to credit risk from its sale to small and large format retailers on credit.

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. Credit insurance is resorted to most of the receivable and in such cases the credit risk is restricted to 15 % of the receivable value.

The concentration of credit risk is limited due to the customer base being large and unrelated. Further, the Company constantly evaluates the quality of trade receivables and provides allowance towards doubtful debts.

D. Liquidity risk

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 liabilities.

7. Related party disclosures (As per Ind AS 24 âRelated party disclosuresâ) 1) Key Management Personnel (KMP)

Mr. Raj Shankar, Managing Director

Mr. E.H. Kasturi Rangan, Whole time Director

Refer note 39 for details of remuneration paid to KMP

Redington Employees Share Purchase Trust administers the Employee Share Purchase Scheme (ESPS), which is in accordance with Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999.

8. Corporate social responsibility

For the year 2018-19, the Company was required to spend â5.75 Crores (previous year: â5.74 Crores) on âCorporate Social Responsibility (CSR)â against which the Company has spent â5.75 Crores (previous year: â5.75 Crores), being the contribution made by the Company to a Trust formed for the purposes of carrying out CSR activities.

9. Segment Reporting

Since the Company prepares consolidated financial statements, segment information has been disclosed in consolidated financial statements as per Ind AS-108 âOperating Segmentâ.

10. Employee Stock Option Plan 2008 (ESOP 2008)

The Company followed intrinsic value method as per pervious GAAP for accounting of employee stock options and had availed the exemption under Ind AS 101 âFirst time adoption of Indian Accounting Standardsâ at the time of transition to Ind AS from retrospective application of accounting requirements prescribed under Ind AS 102 âShare-based paymentâ for outstanding options as on the transition date. Accordingly, no compensation costs had been recognized in these accounts as the options have been granted at the prevailing market prices at the time of each grant.

The variables / assumption used for calculating the fair value of Grant V using the Black Scholes model and their rationale were as follows:

A. Stock price

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

B. Volatility

Volatility is a measure of the amount by which the stock 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.

In determining volatility, the Company considers the historical volatility of the stock over the most recent period that is generally commensurate with the expected life of the option being valued.

Given that the Companyâs stock is publicly traded on NSE and BSE, for the purpose of calculating volatility, the Company has 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 being valued.

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 â348.05 on February 29, 2008. Subsequently, 1,959,830 and 75,000 options were re-priced at a market price of â130/- and â165/- on January 28, 2009 and May 22, 2009 respectively. On December 5, 2011 173,212 options were granted at a price of â396.50 per option.

E. Expected Life of options

Expected Life of options is the period over which the Company expects the options to be exercised. 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.

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 expected life of option is calculated as the average of the minimum life (vesting period) and the maximum life (i.e. vesting period exercise period). Expected life of option 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 two years to the date of the grant.

11. Stock Appreciation Rights

A. Details of Stock Appreciation Rights

The Company has formulated âREDINGTON STOCK APPRECIATION RIGHT SCHEME 2017â (âSAR Scheme 2017â) with an intent to reward the employees of the Company and its subsidiaries for their performance and to motivate them to contribute to the growth and profitability of the Company. The maximum number of shares to be issued against the Stock Appreciation Rights (SARs) shall not exceed 8,681,681 equity shares of Rs. 2/- each as adjusted for any changes in the capital structure of the Company. Pursuant to the approval of SAR Scheme 2017 by the members of the Company, the Nomination and Remuneration Committee of the Board of Redington (India) Limited on 30th December 2017 approved the grant of 8,179,000 SARs to the employees of the Company and its subsidiaries.

Each SAR entitles the eligible employees and directors to receive equity shares of the Company equivalent to the increase in value of one equity share (âAppreciationâ). Appreciation is calculated by reducing the issue price / base price from the reported closing price of the equity shares in the NSE / BSE where there is highest trading, on the day prior to the date of exercising of these SARs and multiplying the resultant with the number of SARs exercised.

These SARs vest over a period of 3 years from the date of the grant in the following manner:

The Company has used the Black-Scholes Option Pricing Model to determine the fair value of the SARs based on which the compensation cost for the current year has been computed.

The said SAR Scheme is in compliance with the provisions of Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014.

The variables / assumptions used at the time of the grant for calculating the fair value using the above model and their rationale are as follows:

i. Stock price

The closing market price of the Companyâs share on the date prior to the date of grant as quoted on the National Stock Exchange (NSE) has been considered for the purposes of right valuation.

ii. Volatility

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

iii. Risk free interest rate

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

iv. Exercise / base price

Exercise / base price of â148.50 is considered in the above valuation.

v. Expected Life of SARâs

The expected life of rights is calculated as the average of the minimum life (vesting period) and the maximum life (i.e. vesting period exercise period).

vi. Expected dividend yield:

Expected dividend yield has been calculated based on the final dividend declared during the preceding financial year.

F. Expense recognized in Statement of profit and loss

The Company has recognized costs with respect to those SARs which were issued to the employees and directors of the Company in the statement of profit and loss under employee benefit expenses.

G. Amount recognized as cost of investments in subsidiaries

The Company has recognized the cost of those SARs which were issued to the employees and directors of the subsidiaries as the cost of investments.

12. Buy Back of equity shares

The Board of Directors at its meeting held on September 17, 2018, considered and approved the proposal for buy-back of up to 11,120,000 fully paid up equity shares of the Company (representing 2.78 % of the total paid-up equity share capital of the Company as on March 31, 2018) of the face value of Rs. 2 each at a price of Rs. 125 per equity share for an aggregate amount not exceeding Rs. 139 Crores from the members of the Company, as on September 28, 2018 (the record date determined by the Board), on a proportionate basis through âTender Offerâ route as prescribed under the SEBI (Buy-back of Securities) Regulations, 2018. A Letter of Offer was made to all eligible shareholders and the Company completed the buy-back of 11,120,000 equity shares resulting in a reduction in the share capital and securities premium of the Company by Rs. 2.22 Crores and Rs. 136.78 Crores respectively.

Further, pursuant to the buy-back, the Company has also transferred an amount of Rs. 2.22 Crores from general reserve to capital redemption reserve in accordance with the provisions of the Companies Act, 2013. The transaction costs relating to buy-back amounting to Rs. 2.29 Crores was charged to Surplus in the statement of profit and loss (Retained earnings) under other Equity.

13. Adoption of Ind AS 115 - Revenue from contracts with customers

The Company has adopted Ind AS 115, Revenue from Contracts with Customers (which replaces earlier revenue recognition standards) with effect from April 1, 2018. The core principle of this standard is that the Company shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. Under Ind AS 115, the Company recognizes revenue when (or as) a performance obligation is satisfied, i.e. when âcontrolâ of the goods or services underlying the particular performance obligation is transferred to the customer.

The Company has applied Ind AS 115 retrospectively. Accordingly, the information presented for year ended March 31, 2018 has been restated. Upon adoption of Ind AS 115, the Company has changed the accounting policy with respect to income from supplier schemes. Income from supplier schemes was hitherto classified as part of revenue from operations. The Company has adjusted rebate earning from supplier schemes against purchase of traded goods.

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

The Board of Directors at its meeting held on May 22, 2019 has recommended a dividend of Rs. 3.30/- per equity share of Rs. 2/- each (i.e., 165 % of face value) for the financial year ended March 31, 2019 (previous year Rs. 2.40 per equity share of Rs. 2/- each (i.e., 120% of face value) subject to the approval of shareholders in the ensuing Annual General Meeting.

15. These standalone financial statements were approved for issue by the Board of Directors on May 22, 2019.

Mar 31, 2018

*Represents transfer of investment held in Redingote Gulf FZE by Redington International Holdings Ltd on July 10, 2013, to comply with the directive of the Reserve Bank of India

Stock Appreciation Rights (SAR)

Unrecognized deferred tax assets

Consequent to the sale of the Company''s Investment in its wholly owned subsidiary Easy access Financial Services Limited in FY 2013-14 and a land at Delhi in FY 2017-18, there was a Long Term Capital loss, under Income Tax Act, 1961, which resulted in deferred tax asset of Rs, 15.39 crores. Out of this Rs, 2.49 crores was recognized against realized Long Term Capital Gain in an earlier year. The balance Deferred Tax Asset of Rs, 12.90 crores will be recognized as and when there is a Long Term capital Gain. These unrecognized deferred tax asset will expire over a period of 4- 8 years

Terms/rights attached to equity shares

Capital 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.

Retirement Benefit Obligation reserve represents accumulated balances of actuarial gains/losses, arising out of employee defined benefit obligation and will not to be subsequently reclassified to Profit and Loss. This reserve is not a distributable reserve._

Exchange differences relating to the translation of the results and net assets of the Company''s foreign operations from their functional currency to the presentation currency are recognized directly in other comprehensive income and accumulated in the foreign currency translation reserve.

The above reserve represents profits generated and retained by the Company post distribution of dividends to the equity shareholders in the respective years. This reserve can be utilized for distribution of dividend by the Company _considering the requirements of the Companies Act, 2013.___

Gratuity (included as part of employee benefits expense in note 28)

The Company provides for gratuity, a defined benefit retirement plan (âthe Gratuity Plan'') covering eligible employees. The Gratuity Plan provides a lump-sum payment to vested employees at retirement, death or termination of employment, of an amount based on the respective employeeâs salary and the tenure of employment with the Company. The Companyâs obligation towards Gratuity is a defined benefit plan and the details of actuarial valuation as at the year-end are given below:

Note A

Contingent liabilities include similar issues for which the Company has received favorable disposition at the Tribunal level in the past.

Note B

The Company had filed an appeal during July 2016 before CESTAT - Delhi against the Service tax demand of Rs, 21.59 crores (including interest and penalty) raised for the period October 2009 to September 2014, determining service tax liability on the HP Indigo Consumables and Spare parts support agreement on which VAT is already paid. CESTAT - Delhi vide its order passed during April 2018 allowed the appeal filed by the Company and set-aside the demand raised in full with consequential reliefs. In the proceedings, the Company had earlier deposited Rs, 4.00 crores under protest and adjusted Cenvat input credit of Rs, 8.59 crores against the tax liability, totaling Rs, 12.59 crores. The Company would be filing for refund of these amounts as per due process of law.

iv. Capital commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is Rs, 15.57 crores (previous Year: Rs, 1.32 crores).

1. OPERATING LEASES

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

The following table shows the fair value of financial assets and financial liabilities, including their levels in the fair value hierarchy. It does not include fair value information for financial assets and financial liabilities if the carrying amount is a reasonable approximation of fair value.

2. FINANCIAL RISK MANAGEMENT

The Company''s activities expose it to a variety of financial risks such as foreign exchange risk, interest rate risk, credit risk and liquidity risk. The Company''s focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. The primary market risk of the Company is credit and foreign exchange risk.

The Company''s senior management oversees the management of these risks. The Company''s senior management is supported by a financial risk committee that advises on financial risks and the appropriate financial risk governance framework for the Company. The financial risk committee provides assurance to the Company''s senior management that the Company''s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives.

A. Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates is limited to payment in foreign exchange for purchase of goods.

The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions.

The un-hedged balances as at March 31, 2018 are primarily on account of purchase of goods where the Company is in the process of hedging and the balance in vendor account which to a larger extent have natural hedge.

Sensitivity analysis:

Sensitivity analysis is carried out for un-hedged foreign exchange risk as at March 31, 2018. For every 1% strengthening of Indian Rupees against all relevant uncovered foreign currency transactions profit before tax would be impacted by loss of Rs, 1.10 crores (previous year Rs, 0.11 crores). Similarly, for every 1% weakening of Indian Rupee against these transactions, there would be an equal and opposite impact on the profit before tax.

B. Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates.

The Company borrows funds to meet its short-term requirements which are at fixed interest rates. Hence, the Company is not exposed to any significant interest rate risk.

C. Credit risk

D. Liquidity risk

The following table details the Company''s remaining contractual maturity for its non-derivative financial liabilities:

3. RELATED PARTY DISCLOSURES (AS PER IND AS 24 âRELATED PARTY DISCLOSURES"!

1) 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 38 below for remuneration

2) Names of the related parties

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

Parties having Significant Influence on Synnex Mauritius Limited, Mauritius *_

the Company__Harrow Investment Holding Limited (Upto July 13, 2017)_

Subsidiary Companies__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 QatarWLL, Dubai_

__Ensure Services Arabia LLC, Saudi Arabia_

__Redington Africa Distribution FZE, Dubai_

__Ensure Services Bahrain S.PC, Bahrain_

__Redington Distribution Pte. Limited, Singapore *_

__Redington Bangladesh Limited, Bangladesh_

__Redington Qatar Distribution W.L.L., Qatar_

__Redington Kenya (EPZ) Ltd, Kenya_

__Redington Limited, Ghana_

__Redington Uganda Limited, Uganda_

__Redington Gulf FZE Co, Irag_

__Cadensworth UAE LLC, Dubai_

__Redington Morocco Limited. Morocco_

__Redington Tanzania Ltd.. Tanzania_

__Redington SL (Private) Ltd.. Sri Lanka_

__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_

__Pro Connect 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_

__Pro Connect Supply Chain Logistics LLC. Dubai_

__Ensure Ghana Limited. Ghana_

__Ensure Support Services (India) Limited. India*_

__Ensure Technical Services Morocco Limited (SARL), Morocco_

__Redington Senegal Limited SARL_

__Redington Saudi Arabia Distribution Company, Saudi Arabia_

__Paynet Odeme Hizmetleri A., Turkey_

CDW International Trading FZE, Dubai

(Name changed to CDW International Trading FZCO

__after the balance sheet date)_

__RNDC Alliance West Africa Limited, Nigeria_

__Linkplus Bilgisayar Sistemleri Sanayi ve TicaretA.S, Turkey_

__Redserv Business Solutions Private Limited, India_

__Pro Connect Saudi LLC, Saudi Arabia_

__Redington Distribution Company LLC, Egypt_

__Ensure MiddleEast Technology Solutions LLC, Abu Dhabi_

__Rajprotim Supply Chain Solutions Limited, India_

__Incorporated during the year_

__Citrus Consulting Services FZ-LLC, Dubai_

Arena Mobile lletisim Hizmetleri Ve Tuketici Elektronigi Sanayi Ve Ticaret

__Anonim Sirketi. Turkey_

__Online Elektronik Ticaret Hizmetleri Anonim Sirketi. Turkey_

__Paynet (KIBRIS) Odeme Hizmetleri Limited. Cyprus_

__Ensure Services Limited. Egypt_

__Redington Cote d''Ivoire SARL. Cote d''Ivoire_

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.

* a) Includes remuneration paid to Mr. Raghunandan amounting to Rs, 0.14 crores.

* b) Salary entitlement for the full financial year 2017-18 for Mr. E.H. Kasturi Rangan is considered in salaries and bonus.

c) Provision for gratuity and compensated absences are based on the actuarial valuation performed on an overall Company basis and hence excluded above.

d) The Company has filed an application with Ministry of Corporate Affairs for reappointment of Mr. Raj Shankar as the Managing Director, since he is a non-resident Indian.

4 MERGER OF CADENSWORTH (INDIA) LIMITED

(i) Cadens worth (India) Limited ("Cadens worth") was engaged in information technology product distribution business and after sales services of information technology products. Cadens worth was a wholly owned subsidiary of the Company.

(ii) Pursuant to the order of National Company Law Tribunal, Chennai bench, Cadens worth (India) Limited, ("transferor") was merged with the Company with an appointed date of April 1, 2016. The order has been made effective on July 26, 2017, upon complying with all the relevant requirements under the Companies Act, 2013.

(iii) The amalgamation has been accounted for under the âpooling of interestsâ method as prescribed by Ind AS 103 "Business Combination". Given that the merger is a common control transaction, the prior year figures have been restated as if the merger had occurred from the beginning of the preceding period i.e. April 01, 2016. Accordingly, the assets, liabilities and reserves of the transferor company as at April 01, 2016 have been taken over and recorded at their respective book values and in the same form.

(iv) Consequent to the scheme of amalgamation, the authorized share capital of the transferor company stands cancelled. Also since the merger is of the wholly owned subsidiary with its parent company, no shares were exchanged to effect the amalgamation.

* The previously reported amounts are after considering certain immaterial reclassification.

5. CORPORATE SOCIAL RESPONSIBILITY

For the year 2017-18, the Company was required to spend Rs, 5.74 crores (previous year: Rs, 5.82 crores) on "Corporate Social Responsibility (CSR)" against which the Company has spent Rs, 5.75 crores (previous year: Rs, 5.82 crores), being the contribution made by the Company to a Trust formed for the purposes of carrying out CSR activities.

6. 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.

* Out of the total options granted in 2008, 19,59,830 options were re-priced at Rs, 130/- on January 28, 2009 and 75,000 options were re-priced at Rs, 165/- on May 22, 2009

The variables / assumption used for calculating the fair value of Grant V using the Black Scholes model and their rationale were as follows:

A. Stock price

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

B. Volatility

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

In determining volatility, the Company considers the historical volatility of the stock over the most recent period that is generally commensurate with the expected life of the option being valued.

Given that, the Company''s stock is publicly traded on NSE and BSE, for the purpose of calculating volatility, the Company has 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 being valued.

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.

C. Risk free interest rate

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. Expected Life of options

F. Expected Dividend yield:

Expected dividend yield has been calculated as an average of dividend yields for the preceding two years to the date of the grant.

7. STOCK APPRECIATION RIGHTS

A. Details of Stock Appreciation Rights

The Company has formulated ''REDINGTON STOCK APPRECIATION RIGHT SCHEME 2017'' ("SAR Scheme 2017") with an intent to reward the employees of the Company and its subsidiaries for their performance and to motivate them to contribute to the growth and profitability of the Company. The maximum number of shares to be issued against the Stock Appreciation Rights (SARs) shall not exceed 86,81,681 equity shares of Rs, 2/- each as adjusted for any changes in the capital structure of the Company. Pursuant to the approval of SAR Scheme 2017 by the members of the Company, the Nomination and Remuneration Committee of the Board of Redington (India) Limited on 30th December 2017 approved the grant of 81,79,000 SARs to the employees of the Company and its subsidiaries.

Each SAR entitles the eligible employees and directors to receive equity shares of the Company equivalent to the increase in value of one equity share (âAppreciation''). Appreciation is calculated by reducing the issue price / base price from the reported closing price of the equity shares in the NSE / BSE where there is highest trading, on the day prior to the date of exercising of these SARs and multiplying the resultant with the number of SARs exercised.

These SARs vest over a period of 3 years from the date of the grant in the following manner:

The Company has used the Black-Scholes Option Pricing Model to determine the fair value of the SARs based on which the compensation cost for the current year has been computed.

The said stock option scheme is in compliance with the provisions of Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014.

Details of SARs granted are as follows:

A. Details of SAR_Particulars_

Date of grant December 30, 2017

Fair value at grant date Rs, 71.99 per SAR

(weighted-average)__

Exercise/ Base price Rs, 148.50 (15% discount to the Closing Market Price ofRs, 174.60 at NSEon December

29, 2017) date prior to the date of grant

Vesting commences on December 30, 2018

Vesting requirement The SARs granted would be vested subject to the time and performance conditions

as may be decided by the Compensation Committee from time to time.

Maximum term of SARs granted 3 years from the date of vesting

Method of settlement__Equity shares of the Company_

The variables / assumptions used for calculating the fair value using the above model and their rationale are as follows:

i. Stock price

The closing market price of the Company''s share on the date prior to the date of grant as quoted on the National Stock Exchange (NSE) has been considered for the purposes of right valuation.

ii. Volatility

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

iii. Risk free interest rate

iv. Exercise / base price

Exercise / base price of Rs, 148.50 is considered in the above valuation.

v. Expected Life of rights

Expected Life of rights is the period over which the Company expects the rights to be exercised. The minimum life of rights is the minimum period before which the rights cannot be exercised. The maximum life is the period after which the rights cannot be exercised.

The expected life of rights is calculated as the average of the minimum life (vesting period) and the maximum life (i.e. vesting period exercise period).

vi. Expected dividend yield:

Expected dividend yield has been calculated based on the final dividend declared during the preceding financial year.

F. Expense recognized in statement of profit and loss

The Company has recognized costs with respect to those SARs which were issued to the employees and directors of the

Company in the statement of profit and loss under employee benefit expenses. _

G. Amount recognized as cost of investments in subsidiaries /

The Company has recognized the cost of those SARs which were issued to the employees and directors of the subsidiaries ''

as the cost of investments.

8. EVENTS AFTER THE REPORTING PERIOD (NON-ADJUSTING)

The Board of Directors at its meeting held on May 21, 2018 has recommended a dividend of Rs, 2.40 per equity share of

Rs, 2/- each (i.e., 120% of face value) for the financial year ended March 31, 2018 (previous year Rs, 2.30 per equity share of _

Rs, 2/- each - i.e., 115% of face value) subject to the approval of shareholders in the ensuing Annual General Meeting.

*For the purpose of this disclosure, the term âSpecified 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.

The above disclosure is not applicable for the current year.

9. The financial statements were approved for issue by the Board of Directors on May 21, 2018.

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 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

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. (âADEOâ), 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 (âNook / Transferor Companyâ), 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 1^st 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 âOperating Segmentâ, 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

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 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 1^st 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 1^st 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 1^st 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:

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 Â¥

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 Ã 3.48 Times (Previous Year - 3.78 Times)

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

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

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

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

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