Mar 31, 2023
Your Directors have pleasure in presenting the Forty-sixth Annual Report, together with audited financial statements for the financial year ended on March 31, 2023.
During the Financial Year 2022-23, the global tourism industry experienced a notable recovery, surpassing 900 million travellers, double the number from the previous year, yet still 37% lower than pre-pandemic levels in 2019. The rebound was driven by easing travel restrictions and pent-up demand, with Europe and the Middle East leading the way, reaching 80% and 83% of pre-pandemic levels, respectively. However, the Asia-Pacific region lagged behind, only recovering 23% of its pre-pandemic visitors. Despite challenges, the industry''s outlook remains positive, with pent-up demand and the reopening of the Asia-Pacific region expected to sustain growth.
The Indian travel industry has shown remarkable resilience and recovery amid the challenges posed by different headwinds. As international and domestic travel restrictions were eased, the sector witnessed a gradual return to pre-pandemic levels, with international tourist arrivals reaching 63% by November 2022. The hotel industry, although impacted by inflation and lowered tariffs, saw improved occupancy rates, and the entire aircraft movement experienced significant growth. With effective pandemic management, travel demand has rebounded, and profitability ratios indicated a strong recovery.
The sector is projected to grow substantially, becoming one of the fastest-growing economic sectors with a significant impact on employment and regional development. The government''s initiatives, such as the ''Incredible India'' campaign, the development of tourist destinations, and the promotion of various tourism segments, further contribute to the industry''s growth and position India as an increasingly preferred destination for global travellers.
The Indian government''s Union Budget-2023 demonstrates a firm commitment to invigorating the tourism industry by implementing a series of strategic measures. These initiatives include the development of 50 diverse tourist destinations, encompassing coastal, wildlife, adventure, cultural, and spiritual experiences, aimed at attracting a larger number of visitors and elevating their travel encounters. The focus on modernizing tourism apps and enhancing digital connectivity will facilitate easy access to information and services for travellers. Moreover, the promotion of destination weddings, global conferences, and sporting events not only augments infrastructure but also stimulates economic growth. Through strategic public-private partnerships involving industry associations, local bodies, and experts, effective tourism promotion is ensured.
The Vibrant Village Programme further contributes to overall sector growth by developing tourism infrastructure in border villages.
The Prashad, Nabh Nirman, and Rail Network Expansion initiatives are expected to be instrumental in driving the industry''s progress in the years to come. Moreover, the simplified visa procedures introduced by the government are anticipated to attract more tourists, leading to increased revenue for the industry. The Government''s 5G Initiative is revolutionising the guest experience, transforming how travellers used to interact and engage with services, further positioning the sector''s advancement.
As a result of these proactive measures, the tourism industry is witnessing encouraging signs, with a surge in foreign tourist arrivals and a resurgence in MICE tourism. With a continued focus on infrastructure development, India is poised to become a premier choice for hosting MICE events, elevating the industry''s prospects and boosting economic growth in the country.
The Group''s commitment to customer-centricity and innovation, coupled with its extensive omnichannel presence and technology, has enabled the delivery of unique and delightful travel solutions. Catering to both B2B and B2C customers, its diverse travel products cover domestic and international leisure travel, corporate travel, MICE, and destination management services. Post-pandemic, the Company has adeptly curated travel experiences to meet evolving customer needs, resulting in substantial growth and a positive financial outlook.
The group displayed commendable financial performance, witnessing a substantial improvement in operating EBITDA compared to the previous year''s loss. The overall consolidated total income experienced remarkable year-on-year growth. Notably, Sterling Holidays, a subsidiary of the Company, achieved its highest EBITDA and PBT figures since its inception. This success can be attributed to the Company''s strategic focus on cost optimization, resulting in significant annualized savings and a 20% reduction in costs compared to pre-pandemic levels in FY20. The Company''s prudent financial management is evident from its robust position, with substantial cash and bank balances held as of March 31, 2023.
Standalone performance (FY23 v/s FY22)
* Total Income stood at Rs. 14,759.3 mn compared to Rs. 3,598.7 mn
* Total Income from operations stood at Rs. 13,640.2 mn compared to Rs. 2,857.4 mn
* Profit Before Tax and exceptional items of Rs. 207.7 mn from Rs. (1,180.4) mn
* Profit After Tax stood at Rs. 15.0 mn as compared to Rs. (824.8) mn
Consolidated performance (FY23 v/s FY22)
* Total Income (includes other income) stood at Rs. 51,111.9 mn from Rs. 19,460.6 mn
* Total Income from operations stood at Rs. 50,476.7mn from Rs. 18,882.5 mn
* Total Earnings Before Interest, Taxes, Depreciation and Amortisation was at Rs. 2,414.3 mn from Rs. (1,296.9) mn
* On a consolidated basis, our Company reported PBT before exceptional items of Rs. 282.6 mn from Rs. (3,199.4) mn
* Profit After Tax stood at Rs. 103.7 mn from Rs. (2,539.0) mn.
The above numbers, at both consolidated and standalone levels, include a Mark to Market non-cash, non-operational loss of Rs. 352.8 mn. arising from the Equity Shares held by the Company in Ouess Corp Limited through its Employees Benefit Trust. The corresponding number in FY22 was a loss of Rs. 40.1 mn.
The strong resilience that the Company has shown in terms of recovery when the travel industry was impacted, is a reflection of our focus on innovative and robust business processes and technology. We believe that we have overturned this slump with the right strategy. Foreign Exchange, Corporate Travel, MICE, Leisure Travel, Sterling Holidays, Horizon Travel Services LLC (AlliedTPro), Asian Trails, Private Safaries (East Africa), Desert Adventures (our DMS subsidiary in the Middle East) and DEI (our Digital Imaging Solutions subsidiary) held us in good stead during the financial year, contributing significantly.
As of March 31, 2023, your Company, along with its subsidiaries/Associates/Joint Venture Companies, as the case may be, continues to be amongst the largest integrated travel groups in India. Your Company is a leading integrated transnational travel and travel related services Company offering a broad spectrum of services that include Foreign Exchange, Corporate Travel, MICE, Leisure Travel and Value Added Services.
Your Company along with its subsidiaries has presence in twenty-eight (28) countries outside India through its branches/representative offices.
There has been no change in the nature of the business of the Company. Your Company continues to be in the business of Travel and Travel related services.
The Board of Directors of the Company at its meeting held on Wednesday, September 28, 2022, approved payment of dividend at the rate of 7.00% per annum
(i.e. paise 70 per share of Rs.10 each pro-rated for the period of holding) on Optionally Convertible Cumulative Redeemable Preference Shares (OCCRPS) as on March 31, 2022 as per the terms of issue and subject to compliance with applicable laws and applicable withholding tax, in this regard. Acccordingly, on September 30, 2022, Company has paid Gross dividend of Rs. 295,996,568.77 (Net of TDS Rs. 281,196,740.33) to holder of OCCRPS.
The Directors recommend dividend for approval of the members on Equity Shares @ 40% (i.e. Rs. 0.40 per equity share of Re. 1/- each) for the financial year ended March 31, 2023.
The proposed dividend on the equity share capital will absorb Rs. 188.2 mn for dividend, subject to the applicable withholding of taxes. The Board seeks approval of the shareholders for the dividend recommended on the equity share capital as will be outstanding on the date of book closure/ record date. The propose dividend shall be declared and payable as per the dividend distribution policy of the Company.
The above proposal for declaration of dividend forms part of the Notice of the 46th Annual General Meeting and is recommended for the members'' approval therein. Dividend will be payable subject to approval of members at the ensuing Annual General Meeting and deduction of tax at source to those Shareholders whose names appear in the Register of Members as on the book closure/record date.
During the financial year, the Company has transferred Rs. 6.5 mn from Share Option Outstanding Account to General Reserve. The total General Reserve stands at Rs. 1,168.9 mn as on March 31, 2023.
PROMOTERSFairfax Financial Holdings Limited
The promoter of your Company, Fairbridge Capital (Mauritius) Limited ("FCML") is an indirect wholly-owned subsidiary of Fairfax Financial Holdings Limited ("Fairfax"), a company incorporated under the laws of Canada.
Fairfax is a holding company which, through its subsidiaries, is primarily engaged in property and casualty insurance and reinsurance and the associated investment management. Fairfax was founded in 1985 by the present Chair and Chief Executive Officer, Mr. Prem Watsa. Fairfax has been under present management since 1985 and is headquartered in Toronto, Canada. Its common shares are listed on the Toronto Stock Exchange. Fairfax''s corporate objective is to achieve a high rate of return on invested capital and build long-term shareholder value. Since 1985, Fairfax has demonstrated a strong financial track record to achieve an annual compounded appreciation in book value per share of 18.5% (including dividends) and currently has over USD 92 Bn in consolidated assets.
Thomas Cook (India) Limited is a part of the Fairfax group. As of March 31, 2023, the promoter holds 72.34 % of the total paid up equity share capital of the Company.
DEPOSITS UNDER CHAPTER V OF COMPANIES ACT, 2013
During the financial year, the Company has not accepted any deposits within the meaning of Section 73 & 76 of the Companies Act, 2013, read with the Rules made thereunder, and therefore, no amount of principal or interest on deposit was outstanding as of the Balance Sheet date.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the financial year, all the transactions with related parties were in the ordinary course of business and on an arm''s length basis; and there were no material contracts or arrangements or transactions at arm''s length basis or otherwise. The disclosure in Form AOC-2 is annexed as Annexure 4 of this Board''s Report.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS OF THE COMPANY AND ITS OPERATIONS IN FUTURE
There were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company and its operations in future.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The particulars of Loans, Guarantees are given in the Corporate Governance Report which forms part of the Annual Report. Further, Investments are given in Note 5 of Standalone Financial Statements which forms part of Annual Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to Section 134 of the Companies Act, 2013, with respect to Directors'' Responsibility Statement, it is hereby confirmed that:
i) in the preparation of the annual accounts for the financial year ended March 31, 2023, the applicable accounting standards have been followed and there were no material departures;
ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on March 31, 2023 and of the profit of the Company for the year ended on that date;
iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) the Directors have prepared the annual accounts on a going concern basis;
v) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
vi) the Directors have devised proper system to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
DIRECTORS⢠Appointment and Re-appointment
In accordance with the provisions of Section 152 of the Companies Act, 2013 read with the Rules made there under and the Article 116 of the Articles of Association of the Company, Mr. Chandran Ratnaswami (DIN: 00109215), Non Executive Director of the Company, retires by rotation and being eligible, has offered himself for re-appointment.
Based on performance evaluation and recommendation of Nomination and Remuneration Committee, the Board of Directors recommends his re-appointment as Non Executive Director of the Company, liable to retire by rotation.
As per Regulation 17(1A) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, with effect from April 1, 2019, no listed company shall appoint or continue the directorship of a non executive director who has attained the age of 75 years, unless a special resolution is passed to that effect and justification thereof is indicated in the explanatory statement annexed to the notice for such appointment.
Mr. Chandran Ratnaswami (DIN: 00109215) would attain the prescribed age limit on May 11, 2024. In the opinion of the Nomination and Remuneration Committee and Board of Directors of the Company, considering seniority of Mr. Chandran Ratnaswami and role played by him towards the growth of this Company and to reap the benefits of his rich and varied experience, the re-appointment of Mr. Chandran Ratnaswami as a Non Executive Director of the Company, liable to retire by rotation and continuation of his directorship beyond 75 years of age would be in the interest of the Company and its shareholders. Thereby based on the performance evaluation and the recommendation of the Nomination and Remuneration Committee, the Board of Directors vide resolution dated May 18, 2023 approved and recommended to the shareholders for their approval for the continuation of his Directorship on the Board of the Company as a Non Executive Director beyond 75 years of age, after May 11, 2024, liable to retire by rotation.
Mr. Chandran Ratnaswami is not debarred from holding of office of Director pursuant to any Order issued by Securities and Exchange Board of India, Ministry of Corporate Affairs, Reserve Bank of India or any other such authority.
⢠Key Changes during the financial year and upto the date of Report
The Board with effect from November 30, 2022 approved the appointment/re-designation of the following:
> Relinquishment by Mrs. Kishori Udeshi (DIN: 01344073) from the position of Chairperson of the Board and her re-designation as a Non Executive Independent Director of the Company with effect from November 30, 2022 for the remainder of her term of office upto September 15, 2024 or till such earlier date as to conform to the Company''s policy on corporate governance.
> Re-designation of Mr. Madhavan Menon (DIN: 00008542) as Chairman & Managing Director of the Board and the Company with effect from November 30, 2022 for the remainder of his term of office.
The Members of the Company vide its resolution dated
April 26, 2023, approved the following:
> Payment of remuneration to Mr. Madhavan Menon (DIN:00008542), Chairman and Managing Director and minimum remuneration in case of inadequacy of profits for the period commencing from March 1, 2023 to February 28, 2025.
> Re-appointment of Mr. Mahesh Iyer (DIN: 07560302), as Executive Director and Chief Executive Officer of the Company for a term of 5 years commencing from May 29, 2023 to May 28, 2028 and fixation of remuneration and minimum remuneration in case of inadequacy of profits for the period commencing from May 29, 2023 to May 28, 2026.
The Board of Directors vide its resolution dated July 05,
2023, approved the following, subject to the approval of
share holders at the 46th Annual General Meeting of the
Company:
> Re-designation and appointment of Mr. Madhavan Menon (DIN:00008542) as Executive Chairman in the category of Whole Time Director, from his earlier designation/appointment as Chairman and Managing Director of the Company, for a fresh term of five (5) years commencing from July 05, 2023 to July 04, 2028, not liable to retire by rotation, and fixation of remuneration and minimum remuneration for a period of three (3) years commencing from July 05, 2023 to July 04, 2026, in case of inadequacy of profits.
> Re-designation and appointment of Mr. Mahesh Iyer (DIN: 07560302) as Managing Director and Chief Executive Officer of the Company, from his earlier designation/appointment as Executive Director and Chief Executive Officer, for a fresh term of five (5) years commencing from July 05, 2023 to July 04, 2028, liable to retire by rotation, and fixation of remuneration and minimum remuneration for
a period of three (3) years commencing from July 05, 2023 to July 04, 2026, in case of inadequacy of profits.
Mr. Madhavan Menon and Mr. Mahesh Iyer are not debarred from holding of office of Director pursuant to any Order issued by Securities and Exchange Board of India, Ministry of Corporate Affairs, Reserve Bank of India or any other such authority.
The above proposals for appointment/re-appointment/ re-designation forms part of the Notice of the 46th Annual General Meeting of the Company and the relevant Resolutions are recommended for members approval thereon.
None of the Director of the Company have resigned during the Financial Year under review.
⢠Declaration of Independence
The Company has received necessary declarations from all the Independent Directors on the Board of the Company confirming that they meet the criteria of Independence as prescribed under Section 149 of the Companies Act, 2013 and the Rules made there under and Regulation 16(1)(b) and other applicable regulations, if any, of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended. The Independent Directors have also confirmed that they are not aware of any circumstance or situation which exists or may be reasonably anticipated that could impair or impact their ability to discharge their duties.
Further, the Independent Directors have also submitted a declaration in compliance with the provision of Rule 6(3) of Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, which mandated the inclusion of an Independent Director''s name in the data bank of persons offering to become Independent Directors, of Indian Institute of Corporate Affairs ("IICA") for a period of one year or five years or life time till they continue to hold the office of an Independent Director and also completed the online proficiency test, conducted by Indian Institute of Corporate Affairs, wherever applicable.
The Board of Directors, based on the declaration(s) received from the Independent Directors, have verified the veracity of such disclosures and confirmed that the Independent Directors fulfill the conditions of independence specified in the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Companies Act, 2013, as amended and are independent of the management of the Company.
In the opinion of the Board, all the Independent Director are persons possessing attributes of integrity, expertise and experience (including proficiency) as required under the applicable laws, rules and regulations.
The Company has issued letters of appointment/ reappointment to Independent Directors in the manner as provided under Companies Act, 2013. The terms and conditions of the said appointment are hosted on website of the Company.
⢠Familiarization program for Independent Directors
Your Company has in place the familiarisation programme for Independent Directors with regard to their role, duties and responsibilities, nature of the industry in which the Company operates, business / operating model of the Company etc. The Board Members are provided with all necessary documents/ reports and internal policies to enable them to familiarise with the Company''s procedures and practices. The details of the training and familiarization program are provided in the Corporate Governance Report, which forms part of the Annual Report.
The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015.
In a separate meeting of Independent Directors, performance of non-independent directors, the board as a whole and the Chairperson of the Company were evaluated. Further, the Independent Directors in the said meeting had also assessed the quality, quantity and timeliness of flow of information between the Company''s management and the Board.
The Independent Directors were satisfied with the overall functioning of the Board, which displayed a high level of commitment and engagement.
Performance evaluation of Independent Directors was done by the entire board, excluding the Independent Directors being evaluated.
The performance evaluation of the board was based on the criteria such as the board composition and structure, information and functioning, succession planning, strategic planning, etc.
The performance evaluation of the Committees was based on the criteria such as Structure of the Committee and meetings, effectiveness of committee meetings, frequency of the meetings, etc.
The performance evaluation of the Directors was based on the criteria such as experience, knowledge and competency, governance, safeguarding the interests of all stakeholders, etc.
The performance of the Independent Directors was based on the criteria such as time devoted and attention given to professional obligations for independent decision making and acting in the best
interest of the Company, strategic guidance to the Company and help in determining important policies, etc.
The above criteria are based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017.
Further, the said criteria were also mentioned in the rating sheets which were filled by each of the Directors during the financial year with regard to the abovementioned performance evaluations.
⢠Number of Board Meetings during the financial year
During the financial year, five (5) meetings of the Board of Directors were held, the details of which are given in the Corporate Governance Report of the Company, which forms a part of the Annual Report.
Pursuant to the provisions of the Section 203 of the Companies Act, 2013, the Key Managerial Personnel of the Company as on the date of this Report are:
AMr. Madhavan Menon, Executive Chairman
*Mr. Mahesh Iyer, Managing Director & Chief Executive Officer
Mr. Brijesh Modi, Chief Financial Officer
Mr. Amit Parekh, Company Secretary & Compliance Officer
AMr. Madhavan Menon was re-designated as Executive Chairman of the Company with effect from July 05, 2023.
* Mr. Mahesh Iyer was re-designated as Managing Director and Chief Executive Officer of the Company with effect from July 05, 2023.
The members of the Company at 45th Annual General Meeting ("AGM") held on 28th September, 2022 had reappointed M/s. B S R & Co. LLP, Chartered Accountants [ICAI Firm''s Registration No. 101248W/W-100022], as the Statutory Auditors of the Company, for a second term of consecutive five (5) years to hold the office from the conclusion of 45th Annual General Meeting ("AGM") until the conclusion of 50th AGM of the Company.
Further, vide Ministry of Corporate Affairs (MCA) notification dated May 7, 2018, the requirement for ratification of appointment of Statutory Auditors by members at every AGM has been dispensed with. Accordingly, no such item has been considered in the 46th AGM Notice.
The Statutory Auditors Report does not contain any qualifications, reservations or adverse remarks on the financial statements of the Company. Further, the Company is in compliance with the RBI regulations on downstream investments issued from time to time and no qualification were made by the Statutory Auditors in their report.
The Board of Directors appointed Mr. Keyul M. Dedhia of M/s Keyul M. Dedhia & Associates, Company Secretaries in Practice (COP No. 8618) as the Secretarial Auditor of the Company under Section 204 of the Companies Act, 2013 read with the Rules made thereunder, for conducting the Secretarial Audit for the financial year 2022-23. The Secretarial Audit Report for the financial year 2022-23 does not contain any adverse remark, qualification or reservation. The Secretarial Audit Report is annexed as Annexure 1 which forms part of this Report.
In terms of Regulation 24A of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, every listed entity and its material unlisted subsidiaries incorporated in India shall undertake secretarial audit and shall annex a secretarial audit report given by a company secretary in practice with the annual report of the listed entity. For the FY 2022-23, the unlisted material subsidiary company incorporated in India is M/s. Sterling Holiday Resorts Limited.
M/s. Sterling Holiday Resorts Limited, has appointed M Damodaran & Associates LLP, Company Secretaries in Practice as the Secretarial Auditor, for the year ended March 31, 2023.
Accordingly, the Secretarial Audit Report of M/s. Sterling Holiday Resorts Limited is set out in the "Annexure 1-A".The said report do not contain any adverse remark, qualification or reservation.
Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities carried out by the Company.
DETAILS OF FRAUD REPORTED BY AUDITORS
There were no frauds reported by the Statutory Auditors under the provisions of Section 143(12) of the Companies Act, 2013 and the Rules made there under.
CORPORATE SOCIAL RESPONSIBILITY
Corporate Social Responsibility (''CSR'') Committee
In compliance with the requirements of Section 135 of the Companies Act, 2013 read with the applicable rules made there under, the Company has a duly constituted CSR Committee. The details of the CSR Committee are provided in the Corporate Governance Report of the Company, which forms part of the Annual Report.
The contents of the CSR Policy of the Company as approved by the Board in its meeting held on May 27, 2021 on the recommendation of the CSR Committee is available on the website of the Company and can be accessed through the web link at https://resources.thomascook.in/downloads/ ThomasCookCSRPolicy.pdf
CSR initiatives undertaken during the financial year
2022- 23, if any
The Annual Report on CSR Activities undertaken by Company during the financial year 2022-23, is annexed as Annexure 2 which forms part of this Report.
Excess CSR amount of Rs. 55.91 Lakhs spent in the financial year 2020-21 was carried forward and is available for setoff for next three years. Since there was no spending required for financial year 2021-22 and financial year 2022-23, the entire amount is available for set off for financial year
2023- 24.
The Company has the following committees of the Board of Directors and the details pertaining to such committees are mentioned in the Corporate Governance Report, which forms part of the Annual Report:
⢠Audit Committee
⢠Risk Management Committee
⢠Nomination & Remuneration Committee
⢠Stakeholders Relationship Committee
⢠Corporate Social Responsibility Committee
⢠Sub-Committee of the Board
During the year, all recommendations made by the aforesaid committees were approved by the Board.
As on the date of this report, the Company has its Equity Shares listed on the following Stock Exchanges:
i. BSE Limited and
ii. The National Stock Exchange of India Limited
The listing fees for the financial year under review have been paid to the Stock Exchanges where the Equity Shares of the Company are listed.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Your Company continues to be committed to good corporate governance aligned with the best corporate practices. It has also complied with various standards set out by Securities and Exchange Board of India and the Stock Exchanges where its Securities are listed. The Management Discussion and Analysis Report for the financial year 202223, as stipulated under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, forms part of the Annual Report.
For the financial year ended March 31, 2023, your Company has complied with the requirements of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and other applicable rules and regulations with respect to Corporate Governance.
A certificate from a Practicing Company Secretary obtained by the Company regarding such compliance of conditions of Corporate Governance is annexed to the Corporate Governance Report which forms part of the Annual Report.
NOMINATION CUM REMUNERATION POLICY
For the purpose of selection of any Directors, Key Managerial Personnel and Senior Management Employees, the Nomination & Remuneration Committee identifies persons of integrity who possess relevant expertise, experience and leadership qualities required for the position. The Committee also ensures that the incumbent fulfills such other criteria with regard to age and other qualifications as laid down under the Companies Act, 2013 or other applicable laws. The Board has, on the recommendation of the Nomination & Remuneration Committee framed a Nomination cum Remuneration policy for selection, appointment and remuneration of Directors, Key Managerial Personnel & Senior Management Employees.
The contents of the Nomination cum Remuneration Policy of the Company was amended and approved by the Board, effective from March 31, 2023 on the recommendation of the Nomination & Remuneration Committee whereby the evaluation criteria for Independent Directors and Board as a whole was modified. Further, the Board vide its resolution dated May 18, 2023 has further amended the Nomination cum Remuneration Policy of the Company by updating the definition of Senior Management.
The salient features of the Policy as approved by the Board and amended from time to time are as follows:
i. Appointment of the Directors and Key Managerial Personnel of the Company.
ii. Fixation of the remuneration of the Directors, Key Managerial Personnel and other employees of the Company.
iii. Formulate a criterion for determining qualifications, positive attributes and independence of a Director.
iv. Specify methodology for effective evaluation of performance of Board/Committees of the Board and review the terms of appointment of Independent Directors on the basis of the report of performance evaluation of the Independent Directors.
v. To ensure a transparent nomination process for directors with the diversity of thought, experience, knowledge, perspective and gender in the Board.
vi. Undertake any other matters as the Board may decide from time to time.
The Nomination cum Remuneration Policy of the Company is available on the website of the Company at https://resources. thomascook.in/downloads/nominationcumremuneration(nrc) policy.pdf
VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Company has established a vigil mechanism for Directors and Employees by adopting Whistle Blower
Policy which is available on the website of the Company and weblink thereto is https: //resources.thomascook.in/ downloads/WhistleBlowerPolicy.pdf
PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
The Company being in the Travel and Tourism Industry, its activities do not involve any expenditure on Technology and Research and Development, therefore, the particulars in the Companies (Accounts) Rules, 2014, as amended, in respect of Conservation of Energy and Technology Absorption is not applicable to the Company. Further, the Company is not energy intensive. However, the Company takes every effort to ensure optimum use of energy by using energy- efficient LED Lightings, Air Conditioners, etc.
During the financial year, the foreign exchange earnings of the Company amounted to Rs. 618.1 mn, whereas, the Company has incurred Rs. 182.05 mn as expenditure in foreign currencies towards interest, bank charges, license fees, professional fees, traveling, subscriptions, etc.
MATERIAL CHANGES AND COMMITMENTS AND OTHER UPDATES
Following material changes and commitments occurred during the financial year 2022-23 and between the end of the financial year and the date of the Report affecting the financial position of the Company:
Pursuant to the approval of the Board of Directors of the Company vide its Resolution dated May 23, 2022, the Company has converted the balance 13,29,37,000 Optionally Convertible Cumulative Redeemable Preference Shares (OCCRPS) of Rs. 10/- each into 2,81,05,073 Equity Shares of Re. 1/- each at the approved rate of Rs. 47.30 per equity share in accordance with the terms of the issue and applicable Securities and Exchange Board of India Regulations. Upon conversion, the Promoter''s equity shareholding increased to 72.34% from 70.58%.
1. The Members of the Company vide its resolution dated April 26, 2023, approved the following:
a. Payment of remuneration to Mr. Madhavan Menon (DIN:00008542), Chairman and Managing Director and minimum remuneration in case of inadequacy of profits for the period commencing from March 1, 2023 to February
28, 2025.
b. Re-appointment of Mr. Mahesh Iyer (DIN: 07560302), as Executive Director and Chief Executive Officer of the Company for a term of 5 years commencing from May 29, 2023 to May 28, 2028 and fixation of remuneration and minimum remuneration in case of inadequacy of profits for the period commencing from May
29, 2023 to May 28, 2026.
2. The Board of Directors vide its resolution dated July 05, 2023, approved the following, subject to the approval of share holders at the 46th Annual General Meeting of the Company:
a. Re-designation and appointment of Mr. Madhavan Menon (DIN:00008542) as Executive Chairman in the category of Whole Time Director, from his earlier designation/ appointment as Chairman and Managing Director of the Company, for a fresh term of five (5) years commencing from July 05, 2023 to July 04, 2028, not liable to retire by rotation, and fixation of remuneration and minimum remuneration for a period of three (3) years commencing from July 05, 2023 to July 04, 2026, in case of inadequacy of profits.
b. Re-designation and appointment of Mr. Mahesh Iyer (DIN: 07560302) as Managing Director and Chief Executive Officer of the Company, from his earlier designation/appointment as Executive Director and Chief Executive Officer, for a fresh term of five (5) years commencing from July 05, 2023 to July 04, 2028, liable to retire by rotation, and fixation of remuneration and minimum remuneration for a period of three (3) years commencing from July 05, 2023 to July 04, 2026, in case of inadequacy of profits.
The above proposals for re-designation and appointment forms part of the Notice of the 46th Annual General Meeting of the Company and the relevant Resolutions are recommended for members approval thereon.
COMPLIANCE MANAGEMENT FRAMEWORK
The Company has instituted an online compliance management system within the organization to monitor compliances and provide update to senior management and Board on a periodic basis. The Audit Committee periodically monitors status of compliances with applicable laws.
The Company has adequate Risk Management framework to identify, measure, manage and mitigate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on the business strategy and enhance the Company''s competitive advantage. This risk framework thus helps in managing market, credit and operational risks and quantifies potential impact at a Company level.
Regulation 21 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 mandates the top 1000 listed companies based on their market capitalization to have a Risk Management Committee and accordingly to adopt Risk Management Policy.
However, the risk management functions were overseen by the Audit cum Risk Committee of the Company duly constituted in 2019.
During the FY 2021-22, the Audit Committee has recommended and the Board of Directors has approved the updated Risk Management Policy vide its resolutions dated September 7, 2021 and September 10, 2021, respectively.
The Board of Directors vide its resolution dated September 10, 2021 approved for formation of Risk Management Committee w.e.f. September 15, 2021 and also amended the nomenclature of the Audit cum Risk Management Committee to Audit Committee. The details of the Risk Management Committee are provided in the Corporate Governance Report of the Company, which forms part of the Annual Report.
The details and the process of the Risk Management as implemented in the Company are provided as part of Management Discussion and Analysis which forms part of the Annual Report.
In compliance with the provisions of Section 134 and 92 of the Companies Act, 2013, the Company has placed a copy of the Annual Return as on March 31, 2023 on its website at https://resources.thomascook.in/downloads/ FormMGT7TCIL.pdf
ACQUISITIONS/ INCORPORATIONS/ OTHER CORPORATE RESTRUCTURINGS
The Company is committed to building long term shareholder value by growing the business inorganically and through acquisitions and alliances.
The Company was directly or indirectly involved in the following Acquisitions/ Incorporations:
⢠Thomas Cook (India) Limited''s wholly owned
subsidiary Travel Corporation (India) Limited entered into Joint Venture Agreement with Sri Lankan Company viz. Authenticities (Private) Limited, for investing in Tropiculture (Private) Limited, a company incorporated in Sri Lanka.
⢠Thomas Cook (India) Limited''s subsidiary Desert Adventures Tourism LLC, and GCC-based travel conglomerate Kanoo Travel formed a Joint Venture.
⢠Thomas Cook (India) Limited''s wholly owned
subsidiary Horizon Travel Services LLC (AlliedTPro), and New World Travel, Inc. formed a Strategic Joint Venture named Allied New World LLC.
OPTIONALLY CONVERTIBLE CUMULATIVE PREFERENCE SHARE
The Company pursuant to the approval of shareholders of the Company at its Extraordinary General Meeting held on 26th March, 2021 had allotted 43,56,57,000 Optionally Convertible Cumulative Redeemable Preference Shares of Face Value Rs. 10/- each to Fairbridge Capital (Mauritius) Limited on a private placement basis.
The Company has converted the above said Optionally Convertible Cumulative Redeemable Preference Shares (OCCRPS) into Equity Shares in following manner:
Tranche 1: Conversion of 302720000 out of 435657000 OCCRPS of Rs. 10/- each, into 64000000 Equity Shares of Re. 1/- each on March 17, 2022 and
Tranche 2: Conversion of balance 132937000 OCCRPS of Rs. 10/- each, into 28105073 Equity Shares of Re. 1/- each on June 20, 2022.
Further, pursuant to the provisions of Regulation 32 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with Securities and Exchange Board of India Circular No. CIR/ CFD/CMD1/162/2019 dated December 24, 2019 regarding Format on Statement of Deviation or Variation for proceeds of Public issue, Rights issue, Preferential issue, Qualified Institutions Placement (QIP) etc., it is hereby confirmed that there were no deviation or variation in the use of proceeds of the Preferential Issue of Optionally Convertible Cumulative Redeemable Preference Shares to the Promoter(s) of the company M/s. Fairbridge Capital (Mauritius) Limited on a private placement basis, from the objects stated in offer document and explanatory statement to the notice of general meeting.
Aforesaid new Equity Shares alloted on conversion(s) of OCCRPS were duly listed on BSE Limited and National Stock Exchange of India Limited.
In line with the MCA Circulars and Securities and Exchange Board of India Circulars, Notice of the 46th AGM along with the Integrated Annual Report for the financial year 202223 is being sent by electronic mode to those Members whose e-mail addresses are registered with the Company/ Depositories. Physical copy of the Notice of the 46th AGM along with Integrated Annual Report for the financial year 2022-23 shall be sent to those Members who request for the same at [email protected] mentioning their names, Folio Number/DP ID and Client ID.
We request all the shareholders to support the ''Green Initiative'' of the Ministry of Corporate Affairs and the Company''s continuance towards greener environment by enabling the service of the Annual Report, AGM Notice and other documents electronically to your email address registered with your Depository Participant/ Registrar and Share Transfer Agent. We also request and encourage all the investors whose e-mail id is not registered to take necessary steps to register their e-mail id with the Depository Participant/ Registrar and Share Transfer Agent.
During the financial year 2022-23, the following prestigious awards and accolades were received by the Company and its Subsidiaries:
⢠Thomas Cook India & SOTC Travel won Best Outbound & Domestic Tour Operator of the Year Awards at SATTE 2023
⢠SOTC Travel won Best Outbound Travel Operator and Best MICE Travel Operator at The Economic Times Travel & Tourism Annual Awards
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013
The Company has Zero Tolerance towards any action on the part of any employee which may fall under the ambit of ''Sexual Harassment'' at workplace, and is fully committed to uphold and maintain the dignity of every women executive working in the Company. The Company''s Policy provides for protection against sexual harassment of women at workplace and for prevention and redressal of such complaints.
Number complaints filed during the financial year |
3 |
Number of complaints disposed off during the financial year |
3 |
Number of complaints pending at the end of the financial year |
0 |
Further, the Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUACY
The details on Internal Financial Control System and their adequacy are provided in the Management Discussion and Analysis Report of the Company, which forms part of the Annual Report.
Disclosure with respect to the remuneration of Directors and Employees as required under Section 197 of the Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is annexed as Annexure 3 which forms part of this Report.
Statement containing Particulars of Employees pursuant to Section 197 of the Companies Act, 2013 and Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, forms part of the Annual Report. As per the provisions of Section 136 of the Companies Act, 2013, the reports and Financial Statements are being sent to Shareholders of the Company and other Shareholders entitled thereto, excluding the Statement containing Particulars of Employees. Any Shareholder interested in obtaining such details may write to the Company Secretary & Compliance Officer of the Company at [email protected]
EMPLOYEE STOCK OPTION PLANS (ESOPS)
The Company has in force the following Schemes which get covered under the provisions of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021:
- Thomas Cook Employees Stock Option Plan 2007 (ESOP 2007)
- Thomas Cook Save As You Earn Scheme 2010 (SAYE Scheme 2010)
- Thomas Cook Employees Stock Option Plan 2013 (ESOP 2013)
- Sterling Holiday Resorts (India) Limited Employee Stock Options Scheme 2012 (SHRL ESOP 2012)
- Thomas Cook Employees Stock Option Scheme 2018 - EXECOM (ESOP 2018 - EXECOM)
- Thomas Cook Employees Stock Option Scheme 2018-Management (Management ESOP 2018)
During the quarter ended December 31, 2019, the Company formed Thomas Cook Employees Benefit Trust ("Thomas Cook ESOP Trust"), which subscribed 73,56,122 Equity Shares of the Company for Rs. 11,048.8 Lakhs out of the loan received from the Company. Pursuant to the approval of the Hon''ble National Company Law Tribunal, the Composite Scheme of Arrangement and Amalgamation between Thomas Cook (India) Limited and various other companies (the "Scheme"), the Thomas Cook ESOP Trust received 13,89,571 Equity Shares of Quess Corp Limited ("QCL"). Out of 13,89,571 Equity Shares of Quess Corp Limited received, 71,141 shares were transferred to employees on exercise of options during the financial year ended March 31, 2023. During the financial year ended March 31, 2023, Thomas Cook ESOP Trust has transferred 3,76,714 Equity Shares of Re. 1/- each, to employees under Employee Stock Option Scheme ("ESOP"). Also during the financial year ended March 31, 2023, there were no fresh grants. Further, vesting of stock options and other details related to stock options may be referred to in the ESOP Disclosure available on the Company''s website.
Material developments under the schemes:
Our Board of Directors on recommendation of Nomination and Remuneration Committee, vide its resolution dated May 23, 2022 has approved amendment in all existing schemes to be in line with compliance of provisions of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021.
In addition, Members at the 45th Annual General Meeting approved amendment in Thomas Cook Employees Stock Option Scheme 2018 - EXECOM ("ESOP 2018 - EXECOM"), in respect of vesting period as mentioned below:
Old Clause |
New Clause |
Vesting Schedule / Conditions |
Vesting Schedule / Conditions |
Options granted under ESOP 2018 - EXECOM would Vest only at the end of 5 years from the date of grant of such options. Vesting of options would be subject to continued employment with the Company and certain performance parameters. |
Options granted under ESOP 2018 - EXECOM would Vest after 4 years but not later than 7 years from the date of grant of such options. Vesting of options would be subject to continued employment with the Company, conditions specified from time to time and certain performance parameters. |
The specific performance parameters will be decided by the Committee from time to time and will be communicated to the employees. The attainment of such performance parameters would be determined by the Committee from time to time which shall be a mandatory condition for vesting of options. |
The specific performance parameters will be decided by the Committee from time to time and will be communicated to the employees. The attainment of such performance parameters would be determined by the Committee from time to time which shall be a mandatory condition for vesting of options. |
The Nomination & Remuneration Committee administers and monitors the ESOP Schemes. Disclosure on various Schemes, as required under Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 read with Securities and Exchange Board of India Circular no. CIR/CFD/ POLICY CELL/2/2015 dated June 16, 2015 are available on the Company''s website and the weblink thereto is https://resources.thomascook.in/ downloads/DisclosureonvariousSchemesasrequiredunder-SecuritiesandExchangeBoardofIndia(ShareBasedEmploy-eeBenefitsandSweatEquity)Regulations,2021.pdf
The above Schemes are in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, as amended. The Company will obtain the certificate from the Secretarial Auditor of the Company certifying that the Company''s Employee Stock Option Scheme(s) have been implemented in accordance with the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, as amended and in accordance with the resolutions passed by the Members.
During the financial year, no options were granted; hence, no employee has received options equal to or exceeding 1% of the issued share capital of the Company at the time of grant during the financial year.
SUBSIDIARY AND ASSOCIATE COMPANIES
In accordance with Section 129 of the Companies Act, 2013, read with the Rules made thereunder, the Company has prepared a consolidated financial statement of the Company and all its Subsidiaries, Associates and Joint Venture companies, as the case may be, which is forming part of the Annual Report. A statement containing salient features of the financial statements and other necessary information of the Subsidiary/Associates/ Joint venture companies in the format prescribed under Form AOC-1 is included in the Annual Report. The said Form also highlights the financial performance of each of the Subsidiaries and Associates of the Company, included in the consolidated financial statements of the Company.
Details of the Subsidiaries and Associates of the Company are mentioned in the Annual Return hosted on the website of the Company.
In accordance with the provisions of the Section 136 of the Companies Act, 2013, the Annual Report of the Company, containing therein its standalone and the consolidated financial statements has been placed on the website of the Company, www.thomascook.in . Further, as per the proviso of the said section, Annual Financial Statements of each of the subsidiary companies have also been placed on the website of the Company at www.thomascook.in . Accordingly, the said documents are not being attached to the Annual Report. Shareholders interested in obtaining the copy of the Annual Financial Statement of subsidiaries companies may write to the Company Secretary & Compliance Officer of the Company.
A statement containing the salient features of the Financial Statements of Subsidiaries, Associates and Joint venture as per the provisions of the Companies Act, 2013, in the prescribed Form AOC-1 is included in the Annual Report.
COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE FINANCIAL YEAR
During the financial year under review, there were no additions in the subsidiaries, or associate companies. There were no Companies which ceased to be subsidiary (ies)/ associates/joint Ventures of the Company.
The Company was directly or indirectly involved in the following Joint ventures:
⢠Thomas Cook (India) Limited''s wholly owned subsidiary Travel Corporation (India) Limited entered into Joint Venture Agreement with Sri Lankan Company viz. Authenticities (Private) Limited, for investing in Tropiculture (Private) Limited, a company incorporated in Sri Lanka.
⢠Thomas Cook (India) Limited''s subsidiary Desert Adventures Tourism LLC, and GCC-based travel conglomerate Kanoo Travel formed a Joint Venture.
⢠Thomas Cook (India) Limited''s wholly owned subsidiary Horizon Travel Services LLC (AlliedTPro), and New World Travel, Inc. formed a Strategic Joint Venture named Allied New World LLC.
THE DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 (31 OF 2016) DURING THE YEAR ALONGWITH THEIR STATUS AS AT THE END OF THE FINANCIAL YEAR.
No application has been made under the Insolvency and Bankruptcy Code; hence, the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year is not applicable.
THE DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF.
There were no valuations done for the purposes of one time settlement and for obtaining any loan from the Banks/ Financial Institutions.
The Company has adopted the Dividend Distribution Policy to determine the distribution of dividends in accordance with the provisions of applicable laws. The Dividend Distribution policy is available on the website of the Company at https://www.thomascook.in/speeches-presentation
BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT
Pursuant to amendment in Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, top 1,000 listed entities based on market capitalisation are required to submit a Business Responsibility & Sustainability Report ("BRSR") for the FY 2022-2023.
Accordingly, the Company has adopted BRSR and other ESG initiatives. A detailed BRSR in the format prescribed by the Securities and Exchange Board of India describing various initiatives, actions and process of the Company towards the ESG endeavor is part of this Integrated Annual Report.
The Company has embarked its journey of the Integrated Reporting framework prescribed by the International Integrated Reporting Council (IIRC). Through this Report, we aspire to provide our stakeholders an all-inclusive depiction of the organization''s value creation using both financial and non-financial resources. The Report strives to provide insight into our key strategies, operating environment, the operating risk and opportunities, governance structure and the Company''s approach towards long-term substantiality.
The various policies and codes adopted by the Company are stated in detail in the Corporate Governance Report of the Company, which forms part of the Annual Report.
The Company during the financial year complied with the applicable provisions of the Secretarial Standards issued by the Institute of the Companies Secretaries of India.
During the financial year under review, the Registered Office of the Company shifted from Thomas Cook Building, Dr. D. N. Road, Fort, Mumbai - 400001 to 11th Floor, Marathon FutureX Building, N. M. Joshi Marg, Lower Parel (East), Mumbai 400013.
ACKNOWLEDGEMENT AND APPRECIATION
Your Board takes this opportunity to thank the Company''s Shareholders, Customers, Vendors and all other Stakeholders for their continued support throughout the financial year. Your Directors also thank the Reserve Bank of India and other Banks, Ministry of Tourism, Financial
Institutions, Government of India, State Governments and all other Government agencies and Regulatory authorities for the support extended by them and also look forward to their continued support in future.
Your Board also wishes to place on record its appreciation on the contribution made by the Company''s employees across all levels without whose hard work, solidarity and support, your Company''s consistent growth would not have been possible.
FOR AND ON BEHALF OF THE BOARD
Madhavan Menon Mahesh Iyer
Executive Chairman Managing Director and
DIN: 00008542 Chief Executive Officer
DIN: 07560302
Place: Mumbai Dated: July 05, 2023
Mar 31, 2019
Directors'' Report
To the Members,
The Directors have pleasure in presenting the Forty-Second Annual Report, together with audited financial statements for the financial year ended on March 31, 2019.
OVERVIEW
In India, travel and tourism continues to be a key contributor to the economic performance of the country. Tourism is also a potentially large employment generator besides being a significant source of foreign exchange for the country. The travel & tourism sector in India accounted for 8 per cent of the total employment opportunities generated in the country in 2017, providing employment to around 41.6 million people during the same year. The number is expected to rise by 2 per cent annum to 52.3 million jobs by 2028.
India acts as a key attraction for tourism led by its diverse cultural, historic and variety in ecology, terrains and places of natural beauty spread across the count. The sectors offers a varied portfolio of niche tourism products - cruises, adventure, medical, wellness, sports, MICE, eco-tourism, film, rural and religious tours. With India emerging as an economic powerhouse, corporate travel too has increased within the country. During 2018, Foreign Exchange Earnings (FEEs) from tourism increased 4.70 per cent year-on-year to USD 28.59 billion.
The prevalence of the Internet and the rising number of online travel companies have helped expand the Indian travel industry and empower the consumers. India is the most digitally-advanced traveller nation in terms of digital tools being used for planning, booking and experiencing a journey. India''s rising middle class and increasing disposable incomes has continued to support the growth of domestic and outbound tourism.
India is the world''s third largest travel and tourism related investment destination. In 2018 alone, USD 45.7 billion was invested in the sector, constituting 5.9% of national investment. Between 2000 and 2018, total foreign direct investment garnered by the sector was USD 12 billion. The Government of India, through the Ministry of Tourism, has launched several branding and marketing initiatives apart from programme implementations to boost travel and tourism in India.
PERFORMANCE HIGHLIGHTS
For the financial year ended March 31, 2019, on a standalone basis, the Profit before tax stood at Rs.395.5 Mn in FY 2018-19 as compared to Rs. 5,384.1 Mn in FY 2017-18*
- Total Income increased by 19% to Rs. 23,107.9 Mn from Rs. 19,429.6 Mn
- Profit After Tax stood at Rs. 264.6 Mn in FY 2018-19 as compared to Rs. 5,314.2 Mn in FY 2017-18*.
- This is inclusive of onetime accounting gain of Rs. 5,353.6 Mn on account of Quess Corp Limited stake sale.
On a Consolidated basis, your Company posted a Profit before tax (before share of profit/loss of associate and joint venture) of Rs. 572.9 Mn in FY 2018-19 as compared to Rs. 60,741.1 Mn in FY 2017-18*.
- Total Income stood at Rs. 67,186.9 Mn in FY 2018-19 as compared to Rs. 114,115.5 Mn in FY 2017-18*.
- Profit After Tax stood at Rs. 888.3 Mn in FY 2018-19 as compared to Rs. 61,313.9 Mn in FY 2017-18*.
- results of Quess Corp Limited have been consolidated as a subsidiary upto February 28,2018 and from March 2018, it has been reclassified as an associate with its share of profits being considered accordingly.
EXPANDING NETWORK
As of March 31, 2019, your Company, along with its subsidiaries, continues to be amongst the largest integrated travel groups in India. Your company is a leading integrated transnational travel and travel related services company offering a broad spectrum of services that include Foreign Exchange, Corporate Travel, MICE, Leisure Travel, Visa and Passport services and E-Business.
Your Company along with its subsidiaries and associates has presence in countries outside India through its branches/ representative offices in USA (New York), Spain (Madrid), Japan (Osaka), China, Hungary, Portugal, Poland, Italy, Germany, Brazil, Russia, Australia, Nepal, Bhutan, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand, Vietnam, Kenya, South Africa, Dubai, Abu Dhabi, Oman, Jordan, France (Paris), Mauritius Sri Lanka and Hong Kong.
Your Company (exclusive of its subsidiaries) operates through 336 locations and along with the subsidiaries, the network spans over 583 locations in 169 cities, over 150 Preferred Sales Agents and 199 Franchise Partner outlets to have a wider spread and network across the country.
DIVIDEND
The Directors recommend dividend for approval of the members on Equity shares @ 37.5% (i.e. Rs. 0.375 per equity share of Re. 1/- each) for the financial year ended March 31, 2019.
The proposed dividend on the equity share capital will absorb Rs. 139.0 Mn for dividend and Rs. 28.5 Mn for Dividend Tax. The Board seeks approval of the shareholders for the dividend recommended on the equity share capital as will be outstanding on the date of book closure/ record date.
The above proposal for declaration of dividend forms part of the Notice of the 42nd Annual General Meeting and the relevant Resolution is recommended for the members'' approval therein.
REDEMPTION OF NON CONVERTIBLE DEBENTURES
During the year 2013, the Company issued and allotted 10.52% 1000 Unsecured Redeemable Non Convertible Debentures (''NCDs'') of Rs. 10 lakh each, aggregating to Rs. 1000 Mn on private placement basis. Out of total NCDs issued and allotted, 333 NCDs were redeemed on April 15, 2016 (under Tranche I), 333 NCDs were redeemed on April 15, 2017 (under Tranche II) and 334 NCDs were redeemed on April 16, 2018 (under Tranche III) in accordance with the terms of the Information Memorandum.
During the financial year 2015-16, the Company issued & allotted 9.37% 1000 Unsecured Redeemable Non Convertible Debentures (''NCDs'') of Rs. 10 lakh each, aggregating to Rs. 1000 Mn on Private placement basis. Out of total the NCDs issued and allotted, 330 NCDs (under Series I) were redeemed on its due date August 31, 2018 and for the balance 670 NCDs (under Series II and III), after securing necessary approvals, were redeemed early on September 24, 2018 along with interest accrued there on. Further the Company transferred Rs. 333.3 Mn from Debenture Redemption Reserve to General Reserve.
As on March 31, 2019, there were no outstanding NCDs of the Company. Further, total Debenture Redemption Reserve stands NIL as on March 31, 2019.
GENERAL RESERVE
During the financial year, the Company has transferred Rs. 333.3 Mn from Debenture Redemption Reserve and Rs. 7.2 Mn from Share option Outstanding Account to General Reserve. The total General Reserve stands at Rs. 874.3 Mn as on March 31, 2019.
PROMOTERS
Fairfax Financial Holdings Limited
The promoter of your Company, Fairbridge Capital (Mauritius) Limited ("FCML") is an indirect wholly-owned subsidiary of Fairfax Financial Holdings Limited ("Fairfax"), Canada.
Fairfax is a holding company which, through its subsidiaries, is engaged in property and casualty insurance and reinsurance and the associate investment management. Fairfax was founded in 1985 by the present Chairman and Chief Executive Officer, Mr. Prem Watsa. The Company has been under present management since 1985 and is headquartered in Toronto, Canada. Its common shares are listed on the Toronto Stock Exchange. Fairfax''s corporate objective is to achieve a high rate of return on invested capital and build long-term shareholder value. Over the past 33 years, Fairfax has demonstrated a strong financial track record to achieve an annual compounded appreciation in book value per share of 18.7% and currently has over USD 64 Bn in consolidated assets.
Thomas Cook (India) Limited is a part of the Fairfax group. As of date hereof, the promoter holds 66.93% of the total paid up equity share capital of the Company.
DEPOSITS UNDER CHAPTER V OF COMPANIES ACT, 2013
During the financial year, the Company has not accepted any deposits within the meaning of Section 73 & 76 of the Companies Act, 2013, read with the Rules made thereunder, and therefore, no amount of principal or interest on deposit was outstanding as of the Balance Sheet date.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the financial year, all the transactions with related parties were in the ordinary course of business and on an arm''s length basis; and there were no material contracts or arrangements or transactions at arm''s length basis or otherwise. Therefore disclosure in Form AOC-2 is not applicable to the Company.
DISCLOSURES OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNALS
- Details of Significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of the Company and its operations in future
There were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company and its operations in future.
- Other Order(s)
The Competition Commission of India (CCI), vide its Order dated May 21, 2014 imposed a penalty of Rs. 10 Mn on the parties to the Composite Scheme of Arrangement and Amalgamation between Sterling Holidays Resorts (India) Limited (since amalgamated), Thomas Cook Insurance Services (India) Limited (since renamed as Sterling Holiday Resorts Limited) and the Company. The parties filed an appeal with the Competition Appellate Tribunal (COMPAT) against the said Order. COMPAT by its Order admitted the appeal and set aside the impugned Order. CCI subsequently filed an Appeal against COMPAT''s impugned Order before the Hon''ble Supreme Court of India and the Hon''ble Supreme Court of India by its Order dated April 17, 2018 allowed the appeal of the CCI, set aside the Order passed by COMPAT and restored the Order passed by CCI imposing penalty of Rs. 10 Mn with no further costs.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The particulars of Loans, Guarantees and Investment are given in the Corporate Governance Report which forms part of the Annual Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to Section 134 of the Companies Act, 2013, with respect to Directors'' Responsibility Statement, it is hereby confirmed that:
i) in the preparation of the annual accounts for the financial year ended March 31, 2019, the applicable accounting standards have been followed and there were no material departures;
ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on March 31, 2019 and of the profit of the Company for the year ended on that date;
iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) the Directors have prepared the annual accounts on a going concern basis;
v) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
vi) the Directors have devised proper system to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
DIRECTORS
- Appointment, Re-appointment and Remuneration
In accordance with the provisions of Section 152 of the Companies Act, 2013 read with the Rules made there under and Article 116 of the Articles of Association of the Company, Mr. Mahesh Iyer (DIN: 07560302) Executive Director and Chief Executive Officer, retires by rotation at the ensuing Annual General Meeting of the Company and being eligible, offers himself for re-appointment.
Mr. Sumit Maheshwari (DIN: 06920646) was appointed as Additional Non Executive Director by the Board of Directors of the Company at its meeting held on September 27, 2018. As an Additional Director, he holds office up to the date of the ensuing Annual General Meeting of the Company. Accordingly, Mr. Sumit Maheshwari is proposed to be appointed as Non Executive Director liable to retire by rotation at the ensuing Annual General Meeting.
Mrs. Kishori Udeshi, Non Executive Independent Director of the Company will be completing her first term as Independent Director on September 15, 2019. Pursuant to the provisions of Companies Act, 2013, Articles of Association of the Company and based on the recommendation of the Nomination and Remuneration Committee, the Board of Directors vide resolution dated May 27, 2019, approved the re-appointed Mrs. Kishori Udeshi as Non Executive Independent Director for a second term w.e.f. September 16, 2019 up to September 15, 2024 or till such earlier date to conform with the policy on corporate governance of the Company, subject to the approval of the members of the Company by special resolution.
Pursuant to the SEBI notification dated May 9, 2018 effective from April 1, 2019, a company is required to secure approval of the members through special resolution in order to appoint or continue with the directorship of any person as a Non Executive Director who has attained the age of seventy five (75) years. Mr. Sunil Mathur will be attaining 75 years of age on October 11, 2019, thereby based on the recommendation of the Nomination and Remuneration Committee, the Board of Directors vide resolution dated May 27, 2019 approved the continuation of his Directorship on the Board of the Company till the expiry of his tenure as an Non Executive Independent Director as per the original term of appointment i.e. till December 22, 2020, subject to the approval of the members.
Profile and other information of Mr. Mahesh Iyer, Mr. Sumit Maheshwari, Mrs. Kishori Udeshi and Mr. Sunil Mathur as required under Regulation 36 of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and Secretarial Standard - 2 is given in the Corporate Governance Report which forms part of the Annual Report.
The members of the Company in accordance with the provisions of Part B of Section II of Part II of Schedule V of the Companies Act, 2013, at the AGM of the Company held on August 2, 2017 ratified the payment of remuneration for the period from September 12, 2016 to March 31, 2017 and approved payment of remuneration from April 1, 2017 to August 31, 2019 as payment of minimum remuneration in the event of no profit or inadequate profit. The Board of Directors based on the recommendation of the Nomination and Remuneration Committee has approved and proposed to the Members vide resolution dated May 27, 2019 for payment of remuneration to Mr. Menon for the remainder term of his office from September 1, 2019 to February 29, 2020.
The above proposals forms part of the Notice of the 42nd Annual General Meeting and the relevant Resolutions are recommended for the members'' approval therein.
- Resignation
Mr. Harsha Raghavan, Non Executive Director (DIN: 01761512) resigned from the Board with effect from close of business hours on May 24, 2018 due to his preoccupations. The Board expressed its appreciation to the outgoing Director for his valuable inputs, insights and guidance to the Company during his tenure.
- Declaration of Independence
The Company has received necessary declarations from all the Independent Directors on the Board of the Company confirming that they meet the criteria of Independence as prescribed under Section 149 of the Companies Act, 2013 and the Rules made there under and Regulation 16(1)(b) and other applicable regulations, if any, of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, as amended.
- Board Evaluation
The Board of Directors has carried out an annual evaluation of its own performance, Board Committees and individual directors pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.
In a separate meeting of independent directors, performance of non-independent directors, the board as a whole and the Chairman of the Company was evaluated. Further, the Independent Directors in the said meeting had also assessed the quality, quantity and timeliness of flow of information between the Company management and the Board.
Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.
The performance evaluation of the board was based on the criteria such as the board composition and structure, information and functioning, succession planning, strategic planning, etc.
The performance evaluation of the Committees was based on the criteria such as Structure of the Committee and meetings, effectiveness of committee meetings, frequency of the meetings, etc.
The performance evaluation of the Directors was based on the criteria such as experience, knowledge and competency, governance, safeguarding the interests of all stakeholders, etc.
The performance of the Independent Directors was based on the criteria such as time devoted and attention given to professional obligations for independent decision making and acting in the best interest of the Company, strategic guidance to the Company and help in determining important policies etc.
The above criteria are based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017 which is duly observed while carrying the respective evaluation.
- Number of Board Meetings during the financial year
During the financial year, Nine (9) meetings of the Board of Directors were held, the details of which are given in the Corporate Governance Report of the Company, which forms a part of the Annual Report.
KEY MANAGERIAL PERSONNEL
Pursuant to the provisions of the Section 203 of the Companies Act, 2013, the Key Managerial Personnel of the Company as on the date of this Report are:
Mr. Madhavan Menon, Chairman and Managing Director
Mr. Mahesh Iyer, Executive Director & Chief Executive Officer
Mr. Brijesh Modi, Chief Financial Officer
Mr. Amit Parekh, Company Secretary & Compliance Officer
AUDITORS
Statutory Auditors
The Shareholders of the Company at the 40th Annual General Meeting (AGM) held on August 2, 2017, had appointed B S R & Co. LLP, Chartered Accountants (Firm Registration No. 101248W/W - 100022) as Statutory Auditors of the Company for a period of 5 years commencing from the conclusion of 40th AGM till the conclusion of the 45th AGM.
Further, vide Ministry of Corporate Affairs (MCA) notification dated May 7, 2018, the requirement for ratification of appointment of Statutory Auditors by members at every AGM has been dispensed with. Accordingly, no such item has been considered in the 42nd AGM Notice.
The Statutory Auditors Report does not contain any qualifications, reservations or adverse remarks on the financial statements of the Company. Further, in compliance with the RBI requirements the Company has obtained Statutory Auditors Report in relation to downstream investments.
Secretarial Auditor
The Board of Directors appointed Mr. Keyul M. Dedhia of M/s Keyul M. Dedhia & Associates, Company Secretaries in Practice as the Secretarial Auditor of the Company under of Section 204 of the Companies Act, 2013 read with the Rules made there under, for conducting the Secretarial Audit for the financial year 2018-19. The Secretarial Audit Report for the financial year 2018-19 does not contain any adverse remark, qualification or reservation. The Secretarial Audit Report is annexed as Annexure 1 which forms part of this Report.
Cost Records and Audit
Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities carried out by the Company.
DETAILS OF FRAUDS REPORTED BY AUDITORS
There were no frauds reported by the Statutory Auditors under the provisions of Section 143(12) of the Companies Act, 2013 and the Rules made there under.
CORPORATE SOCIAL RESPONSIBILITY
Corporate Social Responsibility (''CSR'') Committee
In compliance with the requirements of Section 135 of the Companies Act, 2013 read with the applicable rules made there under, the Company has a duly constituted CSR Committee. The details of the Committee are provided in the Corporate Governance Report of the Company, which forms part of the Annual Report.
CSR Policy
The contents of the CSR Policy of the Company as approved by the Board on the recommendation of the CSR Committee is available on the website of the Company and can be accessed through the web link: https://resourres.thomasrook.in/downloads/TCIL CORPORATE SOCIAL RESPONSIBILITY POLICY 2.0.pdf
CSR initiatives undertaken during the financial year 2018-19
The Annual Report on CSR Activities undertaken by Company during the financial year 2018-19, is annexed as Annexure 2 which forms part of this Report.
During the financial year 2018-19, the Company has spent Rs. 1.5 Mn on CSR activities.
COMMITTEES OF BOARD
The Company has the following committees of the Board of Directors and the details pertaining to such committees are mentioned in the Corporate Governance Report, which forms part of the Annual Report.
- Audit cum Risk Management Committee
- Nomination & Remuneration Committee
- Stakeholders Relationship Committee
- Corporate Social Responsibility Committee
- Sub-Committee of the Board
LISTING OF SECURITIES
As on the date of this report, the Company has its Equity Shares listed on the following Stock Exchanges:
i. BSE Limited and
ii. The National Stock Exchange of India Limited
The Company has paid the Annual Listing Fees for the financial year under review for all its listed securities to the Stock Exchanges.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Your Company continues to be committed to good corporate governance aligned with the best corporate practices. It has also complied with various standards set out by Securities and Exchange Board of India and the Stock Exchanges where its Securities are listed. The Management Discussion and Analysis Report for the financial year 2018-19, as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual Report.
For the financial year ended March 31, 2019, your Company has complied with the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and other applicable rules and regulations with respect to Corporate Governance.
A certificate from a Practicing Company Secretary obtained by the Company regarding such compliance of conditions of Corporate Governance is annexed to the Corporate Governance Report which forms part of the Annual Report.
NOMINATION CUM REMUNERATION POLICY
For the purpose of selection of any Directors, Key Managerial Personnel and Senior Management Employees, the Nomination & Remuneration Committee identifies persons of integrity who possess relevant expertise, experience and leadership qualities required for the position. The Committee also ensures that the incumbent fulfils such other criteria with regard to age and other qualifications as laid down under the Companies Act, 2013 or other applicable laws. The Board has, on the recommendation of the Nomination & Remuneration Committee framed a Nomination cum Remuneration policy for selection, appointment and remuneration of Directors, Key Managerial Personnel & Senior Management Employees.
During the year under review, the Company has revised the Nomination cum Remuneration Policy, in accordance with the amendments to Section 178 of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The salient features of the Policy as approved by the Board and amended from time to time are as follows:
i. Appointment of the Directors and Key Managerial Personnel of the Company.
ii. Fixation of the remuneration of the Directors, Key Managerial Personnel and other employees of the Company.
iii. Formulate a criterion for determining qualifications, positive attributes and independence of a director.
iv. Specify methodology for effective evaluation of performance of Board/committees of the Board and review the terms of appointment of Independent Directors on the basis of the report of performance evaluation of the Independent Directors.
v. To ensure a transparent nomination process for directors with the diversity of thought, experience, knowledge, perspective and gender in the Board.
vi. Undertake any other matters as the Board may decide from time to time.
The Nomination cum Remuneration Policy of the Company is available on the website of the Company at https://resources. thomascook.in/downloads/Whistle Blower Policy 01 04 2019 final.pdf
VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Company has established a vigil mechanism for Directors and Employees by adopting Whistle Blower Policy which is available on the website of the Company and weblink thereto is https://resources.thomascook.in/downloads/Whistle Blower Policy 01 04 2019 final.pdf.
PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
The Company being in the Travel and Tourism Industry, its activities do not involve any expenditure on Technology and Research and Development, therefore, the particulars in the Companies (Accounts) Rules, 2014, as amended, in respect of Conservation of Energy and Technology Absorption is not applicable to the Company. Further, the Company is not energy intensive. However, the Company takes every effort to ensure optimum use of energy by using energy- efficient LED Lightings, Air Conditioners etc.
During the financial year, the foreign exchange earnings of the Company amounted to Rs.463.1 Mn, whereas, the Company has incurred Rs. 156.4 Mn as expenditure in foreign currencies towards interest, bank charges, license fees, professional fees, travelling, subscriptions etc
MATERIAL CHANGES AND COMMITMENTS
There were no material changes and commitments occurred between the end of the financial year and the date of the Report affecting the financial position of the Company.
RISK MANAGEMENT
The Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018 mandated the top 500 listed companies based on their market capitalization to have Risk Management Committee and accordingly to adopt Risk Management Policy. However, the Company had a risk management policy in place. The risk management related functions were overseen by the Audit Committee. Pursuant to said Regulation effective from April 1, 2019, the risk management functions have been included in the Audit cum Risk Management Committee Charter and the nomenclature of the Audit Committee has been changed to Audit cum Risk Management Committee effective from April 1, 2019.
The Company has adequate Risk Management framework to identify, measure, manage and mitigate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on the business strategy and enhance the Company''s competitive advantage. This risk framework thus helps in managing market, credit and operational risks and quantifies potential impact at a Company level.
There are no risks which in the opinion of the Board threaten the existence of the Company. The details and the process of the Risk Management as implemented in the Company are provided as part of Management Discussion and Analysis which forms part of this Report.
EXTRACT OF ANNUAL RETURN
Pursuant to the provisions of Section 92 of the Companies Act, 2013 read with applicable rules made there under, extract of the Annual Return of the Company in the prescribed Form MGT-9 is annexed as Annexure 3 to this Report and is also available on the website of the Company at https://resources.thomascook.in/downloads/Form MGT-9 Extract of Annual Return for the Financial Year 2018-19.pdf.
COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE FINANCIAL YEAR
During the financial year, companies listed in Annexure 4 to this Report have become or ceased to be the Company''s subsidiary, joint venture or associate companies.
ACQUISITIONS/ INCORPORATIONS/ OTHER CORPORATE RESTRUCTURINGS
The Company is committed to building long term shareholder value by growing the business inorganically and through acquisitions and alliances.
The Company was directly or indirectly involved in the following acquisitions, incorporations and corporate restructurings:
A. Acquisitions/ Incorporations
I. Travel Circle International (Mauritius) Limited, a wholly owned subsidiary of the Company has entered into an agreement on February 25, 2019 to acquire and has subsequently acquired 51% stake in DEI Holdings Limited, an entity registered in Jebel Ali Free Zone (JAFZA) Dubai, UAE along with its subsidiaries.
II. Travel Corporation (India) Limited, a wholly owned subsidiary of the Company has entered into an agreement on February 25, 2019 to acquire 51% stake in BDC Digiphoto Imaging Solutions Private Limited, Mumbai.
III. Horizon Travel Services LLC, a wholly owned subsidiary of the Company has entered into an agreement on February 25, 2019 to acquire 51% stake in Digiphoto Entertainment Imaging LLC, USA.
IV. TC Tours Limited, a wholly owned subsidiary of the Company on entered into a definitive agreement October 5, 2018 to subscribe Compulsorily Convertible Preference Shares (CCPS) of TravelJunkie Solutions Private Limited in tranches resulting into 24% stake in the Company on fulfillment of such terms and conditions as mutually agreeable between the parties. Two tranches have been completed on November 27, 2018 and May 2, 2019 resulting in 21.39% holding as of date.
V. Asian Trails Holding Limited, a subsidiary of the Company has incorporated a Joint Venture Company named Thomas Cook IN Destination (Thailand) Limited with a 49% preferred share capital of that Company.
VI. The Company on April 13, 2018 subscribed to 303000 Optionally Convertible Cumulative Redeemable Preference Shares (OCCRPS) of Rs. 10 each offered by Sterling Holiday Resorts Limited, a wholly owned subsidiary of the Company.
VII. Asian Trails International Travel Services (Beijing) Limited, a subsidiary of the Company has incorporated a Joint Venture Company named ATC Travel Services (Beijing) Ltd by investing in 70% stake of that Company.
B. Corporate Restructurings
I. The Company on April 3, 2018 completed the acquisition of 100% stake in TC Travel Services Limited (formerly known as TC Travel and Services Limited) from TC Tours Limited, a wholly owned subsidiary of the Company.
II. The Company on April 20, 2018 completed the acquisition of balance 4.44% equity stake in Travel Corporation (India) Limited (TCI) from Sterling Holiday Resorts Limited, a wholly owned subsidiary of the Company.
III. The Board, at its meeting held on April 23, 2018 and which was further amended on December 19, 2019, approved the Composite Scheme of Arrangement and Amalgamation amongst Thomas Cook (India) Limited (''TCIL''), Quess Corp Limited (''QCL''), Travel Corporation (India) Limited (''TCI''), TC Forex Services Limited (formerly known as Tata Capital Forex Limited) (''TCF''), TC Travel Services Limited (formerly known as TC Travel and Services Limited) (''TCTSL'') and SOTC Travel Management Private Limited (formerly known as SITA Travels and Tours Private Limited) (''SOTC Travel'') and their respective shareholders (''the Scheme'') in accordance with the provisions of Section 230 to 232 read with Section 52, 55 and 66 of the Companies Act, 2013. The Scheme inter alia provides:
i. Demerger of the inbound business of TCI consisting of business of handling inward foreign tourist activity from TCI into SOTC Travel;
ii. Amalgamation of residual TCI, TCF and TCTSL with TCIL; and
iii. Demerger of the Human Resource Services Business of TCIL (including shares in QCL held by TCIL) into QCL. As a part of consideration, QCL will its issue shares to the shareholders of TCIL.
The said Composite Scheme is subject to requisite statutory and regulatory approvals and sanction by the respective shareholders of each of the companies involved in the Scheme.
AWARDS AND ACCOLADES
The Company has been the recipient of the following prestigious awards and accolades during the financial year 2018-19:
1. Best Tour Operator (International) at Times Travel Awards 2019
2. Hong Kong MICE Top Agent Awards program (TAAP Awards) 2018
3. The French Ambassador''s Award for Exemplary Achievements in Visa Issuance- 2015 to 2018
4. Best Risk Management Framework, Systems, and Governance
- Travel and Leisure 2019 (presented by ICICI Lombard and CNBC-TV18)
5. Best Cash Management Solution - India in "The Asset Triple A Treasury, Trade, Supply Chain & Risk Management Awards 2018" (By ASSET Hong Kong)
6. Digixx 2018 - Silver Award in Insight and Research
7. Digixx 2018 - Silver Award in Social media Digital campaign
8. Top Agent and Outstanding Contribution Awards 2018:
International Airlines: Singapore Airlines, Qantas Platinum Club Award, Scoot, Air Seychelles, Air China, Ethiopian Airlines, Thai Airways, Air Seychelles, Jazeera Airways, Oman Air
Domestic Airlines: Air India, Air Asia, Indigo, Go Air
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013
The Company has Zero Tolerance towards any action on the part of any employee which may fall under the ambit of ''Sexual Harassment'' at workplace, and is fully committed to uphold and maintain the dignity of every women executive working in the Company. The Company''s Policy provides for protection against sexual harassment of women at workplace and for prevention and redressal of such complaints.
Number of complaints pending as on the beginning of Nil
the financial year
Number complaints filed during the financial year 3
Number of complaints pending as on the end of the Nil
financial year
Further, the Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUACY
The details on Internal Financial Control System and their adequacy are provided in the Management Discussion and Analysis Report of the Company, which forms part of the Annual Report.
PARTICULARS OF EMPLOYEES
Disclosure with respect to the remuneration of Directors and Employees as required under Section 197 of the Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is annexed as Annexure 5 which forms part of this Report.
Statement containing Particulars of Employees pursuant to Section 197 of the Companies Act, 2013 and Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, forms part of the Annual Report. As per the provisions of Section 136 of the Companies Act, 2013, the reports and Financial Statements are being sent to shareholders of the Company and other stakeholders entitled thereto, excluding the Statement containing Particulars of Employees. The copy of the said statement is available at the Registered Office of the Company during the business hours on any working day excluding Saturdays, Sundays and Public Holidays up to the date of Annual General Meeting. Any shareholder interested in obtaining such details may write to the Company Secretary & Compliance Officer of the Company. Further, the copies of the said statement shall also be available at the Annual General Meeting.
EMPLOYEES STOCK OPTION PLANS (ESOPS)
The Company after obtaining shareholders approval framed Thomas Cook Employees Stock Option Scheme 2018 - Execom (Execom ESOP 2018) and Thomas Cook Employees Stock Option Scheme 2018- Management (Management ESOP 2018).
The objectives of the Schemes were as follows:
- Execom ESOP 2018 - to reward the Execom Employees of the Company for their performance and to motivate them to contribute to the growth and profitability of the Company.
- Management ESOP 2018 - to motivate and retain key talent in the organisation and fostering ownership and financial motivation.
The Company has in force the following Schemes which get covered under the provisions of SEBI (Share Based Employee Benefits) Regulations, 2014:
- Thomas Cook Employees Stock Option Plan 2007 (ESOP 2007)
- Thomas Cook Save As You Earn Scheme 2010 (SAYE Scheme 2010)
- Thomas Cook Employees Stock Option Plan 2013 (ESOP 2013)
- Sterling Holiday Resorts (India) Limited Employee Stock Options Scheme 2012 (SHRL ESOP 2012)
- Thomas Cook Employees Stock Option Scheme 2018 - Execom (Execom ESOP 2018)
- Thomas Cook Employees Stock Option Scheme 2018-Management (Management ESOP 2018)
During the financial year, options were granted under the following ESOP Schemes of the Company:
- 231965 options under ESOP 2013
- 1747692 options under Execom ESOP 2018
- 1850539 options granted under Management ESOP 2018.
No options were approved for grant under ESOP 2007 and SAYE Scheme 2010.
The above Schemes are in compliance with the SEBI (Share Based Employee Benefits) Regulations, 2014, as amended. The Company has also obtained the certificate from the Statutory Auditors of the Company certifying that the Company''s Employee Stock Option Scheme(s) have been implemented in accordance with the SEBI (Share Based Employee Benefits) Regulations, 2014, as amended and in accordance with the resolutions passed by the Members.
The Nomination & Remuneration Committee administers and monitors the ESOP Schemes. Disclosure on various Schemes, as required under SEBI (Share Based Employee Benefits) Regulations, 2014 read with SEBI Circular no. CIR/CFD/POLICY CELL/2/2015 dated June 16, 2015 are available on the Company''s website and the weblink thereto is https://resources.thomascook.in/downloads/ Disclosure pursuant to SEBI(Share-Based-Employee-Benefits) Regulations 2014 for the financial year 2018-19.pdf.
During the financial year, no employee has received options equal to or exceeding 1% of the issued share capital of the Company at the time of grant during the financial year.
SUBSIDIARY AND ASSOCIATE COMPANIES
In accordance with Section 129 of the Companies Act, 2013, read with the Rules made there under, the Company has prepared a consolidated financial statement of the Company and all its subsidiary and associate companies, which is forming part of the Annual Report. A statement containing salient features of the financial statements and other necessary information of the subsidiary/ associate/ joint venture companies in the format prescribed under Form AOC-1 is included in the Annual Report. The said Form also highlights the financial performance of each of the subsidiaries and associates companies included in the consolidated financial statements of the Company.
In accordance with the provisions of the Section 136 of the Companies Act, 2013, the Annual Report of the Company, containing therein its standalone and the consolidated financial statements has been placed on the website of the Company, www.thomascook. in. Further, as per the proviso of the said section, Annual Financial Statements of each of the subsidiary companies have also been placed on the website of the Company at www.thomascook.in. Accordingly, the said documents are not being attached to the Annual Report. Shareholders interested in obtaining a copy of the Annual Financial Statements of the subsidiary companies may write to the Company Secretary & Compliance Officer of the Company.
DIVIDEND DISTRIBUTION POLICY
The Dividend Distribution Policy of the Company is annexed herewith as Annexure 6 and is also available on the website of the Company at www.thomascook.in.
BUSINESS RESPONSIBILITY REPORT
As required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Business Responsibility Report describing the initiatives undertaken by the Company from an environment, social and governance perspective, forms part of the Annual Report.
INTEGRATED REPORTING
The Company has embarked its journey of the Integrated Reporting framework prescribed by the International Integrated Reporting Council (IIRC). We are taking our first step to move to Integrated
Reporting in line with our continuous commitment to voluntarily disclose more information. Through this Report, we aspire to provide our stakeholders an all-inclusive depiction of the organization''s value creation using both financial and non-financial resources. The Report strives to provide insights into our key strategies, operating environment, the operating risk and opportunities, governance structure and the Company''s approach towards long-term substantiality.
DISCLOSURE REQUIREMENTS
The various policies and codes adopted by the Company are stated in detail in the Corporate Governance Report of the Company, which forms part of the Annual Report.
The Company during the financial year complied with the applicable provisions of the Secretarial Standards issued by the Institute of the Companies Secretaries of India.
ACKNOWLEDGEMENT AND APPRECIATION
Your Board takes this opportunity to thank the Company''s Shareholders, Customers, Vendors and all other Stakeholders for their continued support throughout the financial year. Your Directors also thank the Reserve Bank of India and other Banks, Ministry of Tourism, Financial Institutions, Government of India, State Governments and all other Government agencies and Regulatory authorities for the support extended by them and also look forward to their continued support in future.
Your Board also wishes to place on record its appreciation on the contribution made by the Company''s employees across all levels without whose hard work, solidarity and support, your Company''s consistent growth would not have been possible.
FOR AND ON BEHALF OF THE BOARD
Madhavan Menon Mahesh Iyer
Chairman & Managing Executive Director
Director & Chief Executive Officer
DIN: 00008542 DIN: 07560302
Place: Mumbai
Dated: May 27, 2019
Mar 31, 2018
Directors'' Report
To the Members,
The Directors have pleasure in presenting the Forty-First Annual Report, together with audited financial statements for the financial year ended on March 31, 2018.
OVERVIEW
The Travel and Tourism industry is a major engine of economic growth and an important source of employment and foreign exchange earnings for countries around the world. The industry continues to be a force for good, providing unique opportunities for developing and emerging nations to move up the value chain. As an industry, competitiveness at every level is improving -particularly in the Asia-Pacific region.
The financial year 2017-18 marked the sixth consecutive year for the travel and tourism industry''s achievement of higher growth than the global economy, demonstrating the industry''s resilience in the face of various natural calamities, global geopolitical uncertainty and economic volatility.
The global middle class is forecast to grow by a further 3 billion people by 2031, the majority of whom will come from emerging markets, with China and India leading the way. It is expected that most of the growth in international travel will come from Africa, Asia and the Middle East, which will enable further growth and job opportunities in these regions.
According to a 2018 economic impact report by the World Travel & Tourism Council (WTTC), India is likely to become the third largest tourism economy in the next 10 years. The total contribution by the travel and tourism industry to India''s GDP is expected to increase from USD 234.03 billion in 2017 to USD 492.21 billion in 2028.
Foreign tourist arrivals in India have grown to 10.2 Mn in 2017 compared with 8.8 Mn in 2016. Indiaâs'' inbound growth story continued despite initial teething problems relating to the GST rollout, natural calamities, geo political situations and global recessionary trends. Improved regional air connectivity has further spurred the growth momentum of the travel Industry. Strategic tourism initiatives by the government have also been a key driver of growth.
PERFORMANCE HIGHLIGHTS:
The Financial year ended March 31, 2018 has been a special year for your Company. On a Consolidated basis, your Company posted a Profit before tax of Rs. 60,908.4 Mn (previous period Rs. 1,986.1 Mn).
- Total Income increase of 28% to Rs.112,483.4 Mn from Rs. 87,624.2 Mn
- Profit After Tax posted: Rs. 61,313.9 Mn (previous year Rs. 861.0 Mn)
On a standalone basis, the Profit / (Loss) before tax stood at Rs. 5,384.1 Mn (previous period Rs. (54.3) Mn)
- Total Income increase of 11% to Rs. 19,032.2 Mn from Rs. 17,142.4 Mn
- Profit/ (Loss) After Tax posted was Rs. 5,314.3 Mn (previous year Rs. (83.6) Mn)
EXPANDING NETWORK
As of March 31, 2018, your Company, along with its subsidiaries, continues to be amongst the largest integrated travel groups in India. Your Company (exclusive of its subsidiaries) operates through 281 locations in 104 cities, 59 PSAs and 96 Gold Circle Partner outlets to have a wider spread and network across the country.
Your Company also has presence in countries outside India through its branches/ representative offices in USA (New York), Spain (Barcelona), UK (London), Japan (Tokyo & Osaka), China (Beijing), Hungary, Finland, Portugal, Italy, Germany, Brazil, Ukraine, Russia, Australia, Nepal, Bhutan, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand, Vietnam, Kenya, South Africa, Dubai, Abu Dhabi, Muscat, Qatar, Bahrain, Jordan and France (Paris) apart from its subsidiaries in Mauritius, Sri Lanka, Singapore and China (Hong Kong).
DIVIDEND
The Directors recommend dividend for approval of the members on Equity shares @ 37.5% (i.e. Rs. 0.375 per equity share of Rs. 1/- each) for the financial year ended March 31, 2018.
The proposed dividend on the equity share capital will absorb Rs. 138.8 Mn for dividend and Rs. 28.3 Mn for Dividend Tax. The Board seeks approval of the shareholders for the dividend recommended on the equity share capital as will be outstanding on the date of book closure/ record date.
The above proposal for declaration of dividend forms part of the Notice of the 41st Annual General Meeting and the relevant Resolution is recommended for the members approval therein.
RESERVES
- Debenture Redemption Reserve
During the financial year, your Directors resolved to transfer Rs. 81.9 Mn to Debenture Redemption Reserve. During the financial year, the Company has also transferred Rs. 83.3 Mn from Debenture Redemption Reserve to General Reserve. The total Debenture Redemption Reserve stands at Rs. 252.0 Mn as on March 31, 2018.
- Capital Redemption Reserve
During the financial year, your Directors resolved to transfer Rs. 1,011.9 Mn to Capital Redemption Reserve. The total Capital Redemption Reserve stands at Rs. 1250.0 Mn as on March 31, 2018.
- General Reserve
During the financial year, the Company has transferred Rs. 83.3 Mn from Debenture Redemption Reserve and Rs. 13.6 Mn from Share option Outstanding Account to General Reserve. The total General Reserve stands at Rs. 533.9 Mn as on March 31, 2018.
PROMOTERS
Fairfax Financial Holdings Limited
The promoter of your Company, Fairbridge Capital (Mauritius) Limited ("FCML") is an indirect wholly owned subsidiary of Fairfax Financial Holdings Limited ("Fairfax"), Canada.
Fairfax is a holding company which, through its subsidiaries, is engaged in property, casualty insurance, reinsurance and investment management. Fairfax was founded in 1985 by the present Chairman and Chief Executive Officer, Mr. Prem Watsa. The Company has been under present management since 1985 and is headquartered in Toronto, Canada. Its common shares are listed on the Toronto Stock Exchange. Fairfax''s corporate objective is to achieve a high rate of return on invested capital and build long-term shareholder value. Over the past 32 years, Fairfax has demonstrated a strong financial track record to achieve an annual compounded appreciation in book value per share of 19.5% and currently has over USD 65 Bn in consolidated assets.
Thomas Cook (India) Limited is a part of the Fairfax group. As of date hereof, the promoter holds 67.02% of the total paid up equity share capital of the Company.
PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
The Company being in the Travel and Tourism Industry, its activities do not involve any expenditure on Technology and Research and Development, therefore, the particulars in the Companies (Accounts) Rules, 2014, as amended, in respect of Conservation of Energy and Technology Absorption is not applicable to the Company. Further, the Company is not energy intensive. However, every effort is made to ensure optimum use of energy by using energy - efficient LED Lightings, Air Conditioners etc.
During the financial year, the foreign exchange earnings of the Company amounted to Rs. 388.4 Mn, whereas, the Company has incurred Rs. 138.5 Mn as expenditure in foreign currencies towards interest, bank charges, license fees, professional fees, travelling, subscriptions etc.
DEPOSITS UNDER CHAPTER V OF COMPANIES ACT, 2013
During the financial year, the Company has not accepted any deposits within the meaning of Section 73 & 76 of the Companies Act, 2013, read with the Rules made there under, and therefore, no amount of principal or interest on deposit was outstanding as of the Balance Sheet date.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the financial year, all the transactions with related parties were in the ordinary course of business and on an arm''s length basis; and there were no material contracts or arrangements or transactions at arm''s length basis or otherwise and therefore disclosure in Form AOC-2 is not applicable.
DETAILS OF FRAUDS REPORTED BY AUDITORS
There were no frauds reported by the Statutory Auditors under provisions of Section 143(12) of the Companies Act, 2013 and the Rules made there under.
DISCLOSURES OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNALS
- Details of Significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of the Company and its operations in future
There were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company and its operations in future.
- Other Order(s)
The Competition Commission of India (CCI), vide its Order dated May 21, 2014 imposed a penalty of Rs. 10 Mn on the parties to the Composite Scheme of Arrangement and Amalgamation between Sterling Holidays Resorts (India) Limited (since amalgamated), Thomas Cook Insurance Services (India) Limited (since renamed as Sterling Holiday Resorts Limited) and the Company. The parties filed an appeal with the Competition Appellate Tribunal (COMPAT) against the said Order. COMPAT by its Order admitted the appeal and set aside the impugned Order. CCI subsequently filed an Appeal against COMPAT''s impugned Order before the Hon''ble Supreme Court of India and the Hon''ble Supreme Court of India by its Order dated April 17, 2018 allowed the appeal of the CCI, set aside the Order passed by COMPAT and restored the Order passed by CCI imposing penalty of Rs. 10 Mn with no further costs.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The particulars of Loans, Guarantees and Investments form part of the notes to the financial statements provided in the Annual Report.
REDEMPTION OF NON CONVERTIBLE DEBENTURES
During the year 2013, the Company issued and allotted 10.52% 1000 Unsecured Redeemable Non Convertible Debentures (''NCDs'') of Rs. 10 lakh each, aggregating to Rs. 1000 Mn on private placement basis. Out of total NCDs issued and allotted, 333 NCDs were redeemed on April 15, 2016 (under Tranche I), 333 NCDs were redeemed on April 15, 2017 (under Tranche II) and 334 NCDs which were outstanding as on March 31, 2018 were subsequently redeemed on April 15, 2018 (under Tranche III) in accordance with the terms of the Information Memorandum.
REDEMPTION OF NON CONVERTIBLE CUMULATIVE REDEEMABLE PREFERENCE SHARES
During the year 2015, the Company issued and allotted 8.5% 125000000 Non Convertible Cumulative Redeemable Preference Shares (''NCCRPS'') of Rs. 10 each, aggregating to Rs. 1250 Mn on private placement basis. The Company in accordance with the terms of the Information Memorandum of NCCRPS and applicable provisions of the Companies Act, 2013, Securities and Exchange Board of India (Issue and Listing of Non-Convertible Redeemable Preference Shares) Regulations, 2013, and other applicable laws, rules and regulations, has successfully redeemed NCCRPS at par on December 28, 2017.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to Section 134 of the Companies Act, 2013, with respect to Directors'' Responsibility Statement, it is hereby confirmed that:
i) in the preparation of the annual accounts for the financial year ended March 31, 2018, the applicable accounting standards have been followed and there were no material departures;
ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on March 31, 2018 and of the profit of the Company for the year ended on that date;
iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) the Directors have prepared the annual accounts on a going concern basis;
v) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
vi) the Directors have devised proper system to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
DIRECTORS
- Appointment and Re-appointment
In accordance with the provisions of Section 152 of the Companies Act, 2013 read with the Rules made there under and Article 116 of the Articles of Association of the Company, Mr. Chandran Ratnaswami (DIN: 00109215) Non Executive Director, retires by rotation at the ensuing Annual General Meeting of the Company and being eligible, offers himself for re-appointment.
Mr. Mahesh Iyer (DIN: 07560302), Chief Executive Officer of the Company was appointed as an Additional Director by the Board of Directors at its meeting held on May 29, 2018, with the designation of Executive Director & Chief Executive Officer for a period of five years, subject to approval of shareholders.
The members at the Extraordinary General Meeting held on September 16, 2014, approved the appointment of Mrs. Kishori Udeshi (DIN: 01344073), as an Independent Director of the Company for a period of 5 consecutive years commencing from September 16, 2014. The Securities and Exchange Board of India (SEBI) vide notification dated May
9, 2018 notified SEBI (Listing Obligations & Disclosure Requirements) (Amendment) Regulations, 2018. Pursuant to the said notification, under Regulation 17 to be effective from April 1, 2019, a company would be required to secure approval of the members through special resolution in order to appoint or continue with the directorship of any person as a Non Executive Director who has attained the age of seventy five (75) years. Mrs. Kishori Udeshi on October 13, 2018 shall attain seventy-five (75) years of age and accordingly, the Board of Directors vide its resolution dated May 29, 2018 approved to continue her appointment on the Board of the Company as Non Executive Director beyond 75 years of age, subject to the approval of the members.
Profile and other information of Mr. Chandran Ratnaswami as required under Regulation 36 of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and Secretarial Standard - 2 is given in the Corporate Governance Report of the Company which forms part of the Annual Report. Brief profile and other information of Mrs. Kishori Udeshi and Mr. Mahesh Iyer are given in the Notice of the 41st Annual General Meeting of the Company.
The above proposal for appointment and re-appointment forms part of the Notice of the 41st Annual General Meeting and the relevant Resolutions are recommended for the Members approval therein.
- Resignations
Mr. Harsha Raghavan, Non Executive Director (DIN: 01761512) resigned from the Board with effect from close of business hours on May 24, 2018 due to his preoccupations. The Board expressed its appreciation to the outgoing Director for his valuable inputs, insights and guidance to the Company during his tenure.
- Declaration of Independence
The Company has received necessary declarations from all the Independent Directors on the Board of the Company confirming that they meet the criteria of Independence as prescribed under Section 149 of the Companies Act, 2013 and the Rules made there under and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended.
- Board Evaluation
Pursuant to the provisions of Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out an annual performance evaluation of the Board as a whole, various Committees, Directors individually including the Chairman.
The statement including the manner in which the evaluation exercise was conducted is included in the Corporate Governance Report of the Company, which forms part of the Annual Report.
- Number of Board Meetings during the financial year
During the financial year, Eleven (11) meetings of the Board of Directors were held, the details of which are given in the Corporate Governance Report of the Company, which forms a part of the Annual Report.
KEY MANAGERIAL PERSONNEL
In the meetings of the Nomination & Remuneration Committee, Audit Committee and Board of Directors respectively held on May 25, 2017 Mr. Brijesh Modi was appointed as the Chief Financial Officer of the Company w.e.f. June 1, 2017 in place of Mr. Debasis Nandy, Chief Financial Officer & President - Commercial who was elevated to the position of President & Group Chief Financial Officer of Thomas Cook Group w.e.f. June 1, 2017.
Pursuant to the provisions of the section 203 of the Companies Act, 2013, the Key Managerial Personnel of the Company as on the date of this Report are:
Mr. Madhavan Menon, Chairman and Managing Director
Mr. Mahesh Iyer, Executive Director & Chief Executive Officer
Mr. Brijesh Modi, Chief Financial Officer
Mr. Amit Parekh, Company Secretary & Compliance Officer
AUDITORS
Statutory Auditors
The Shareholders of the Company at the 40th Annual General Meeting (AGM) held on August 2, 2017, had appointed B S R & Co. LLP, Chartered Accountants (Firm Registration No. 101248W/W - 100022) as Statutory Auditors of the Company for a period of 5 years commencing from the conclusion of 40th AGM till the conclusion of the 45th AGM, subject to ratification by shareholders every year, as applicable.
Further, based on the notification issued by the Ministry of Corporate Affairs (MCA) on May 7, 2018, the requirement for ratification of appointment of Statutory Auditors by members at every Annual General Meeting (AGM) has been dispensed with under the Companies (Amendment) Act, 2017, and accordingly, the Company has not placed the matter for ratification of reappointment of Statutory Auditors before the members at the ensuing AGM.
The Statutory Auditors Report does not contain any qualifications, reservations or adverse remarks on the financial statements of the Company. Further, the Company has also obtained Statutory Auditors Report as per the requirement of notification issued by Reserve Bank of India from time to time in relation to downstream investments.
Secretarial Auditor
The Board of Directors have appointed Mr. Keyul M. Dedhia of M/s Keyul M. Dedhia & Associates, Company Secretaries in Practice as the Secretarial Auditor of the Company under of Section 204 of the Companies Act, 2013, for conducting the Secretarial Audit for the financial year 2017-18.The Secretarial Audit Report for the financial year 2017-18 does not contain any adverse remark, qualification or reservation which requires any explanation/ comments by the Board. The Secretarial Audit Report is annexed as Annexure 1 which forms part of this Report.
CORPORATE SOCIAL RESPONSIBILITY
Corporate Social Responsibility (''CSR'') Committee:
In compliance with the requirements of Section 135 of the Companies Act, 2013 read with the applicable rules made there under, the Company has a duly constituted a CSR Committee. The details of the Committee are provided in the Corporate Governance Report of the Company, which forms part of the Annual Report.
CSR Policy:
The contents of the CSR Policy of the Company as approved by the Board on the recommendation of the CSR Committee is available on the website of the Company and can be accessed through the web link: https://resources.thomascook.in/downloads/Corporate%20 Social%20Responsibility%20Policy.pdf.
CSR initiatives undertaken during the financial year 2017-18:
The Annual Report on CSR Activities undertaken by Company during the financial year 2017-18, is annexed as Annexure 2 which forms part of this Report.
During the financial year 2017-18, the Company has spent Rs. 4.6 Mn on CSR activities.
COMMITTEES OF BOARD
The Company have following committees of the Board of Directors and the details pertaining to such committees are mentioned in the Corporate Governance Report which forms part of the Annual Report.
- Audit Committee
- Nomination & Remuneration Committee
- Stakeholders Relationship Committee
- Corporate Social Responsibility Committee
- Sub-Committee of the Board
LISTING OF SECURITIES
As on the date of this report, the Company has its following Securities listed on the Stock Exchanges viz. BSE Limited and The National Stock Exchange of India Limited:
- Equity Shares
- Non-Convertible Debentures (''NCDs'')
The Company has paid the Annual Listing Fees for the financial year under review for all its listed securities to the Stock Exchanges.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Your Company continues to be committed to good corporate governance aligned with the best corporate practices. It has also complied with various standards set out by Securities and Exchange Board of India and the Stock Exchanges where its Securities are listed. The Management Discussion and Analysis Report for the financial year 2017-18, as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual Report.
For the financial year ended March 31, 2018, your Company has complied with the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and other applicable rules and regulations with respect to Corporate Governance.
A certificate from a Practicing Company Secretary obtained by the Company regarding such compliance of conditions of Corporate Governance is annexed to the Corporate Governance Report which forms part of the Annual Report.
NOMINATION CUM REMUNERATION POLICY
For the purpose of selection of any Directors, Key Managerial Personnel and Senior Management Employees, the Nomination & Remuneration Committee identifies persons of integrity who possess relevant expertise, experience and leadership qualities required for the position. The Committee also ensures that the incumbent fulfils such other criteria with regard to age and other qualifications as laid down under the Companies Act, 2013 or other applicable laws. The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection, appointment and remuneration of Directors, Key Managerial Personnel & Senior Management Employees. The Nomination cum Remuneration Policy of the Company and Performance Criteria is annexed herewith as Annexure 3 which forms part of this Report.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Company has established a vigil mechanism for Directors and Employees by adopting Whistle Blower Policy which is available on the website of the Company and we blink thereto is https:// resourres.thomasrook.in/downloads/Whistle%20Blower%20 Policy.pdf.
MATERIAL CHANGES AND COMMITMENTS
There were no material changes and commitments occurred between the end of the financial year and the date of the Report affecting the financial position of the Company.
RISK MANAGEMENT
The Company has voluntarily adopted a Risk Management Policy which lays down the framework to define, assess, monitor and mitigate the business, operational, financial and other risks associated with the business of the Company.
EXTRACT OF ANNUAL RETURN
Pursuant to the provisions of section 92 of the Companies Act, 2013 read with applicable rules made there under extract of the Annual Return of the Company in the prescribed Form MGT-9 is annexed as Annexure 4 to this Report.
COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE FINANCIAL YEAR
During the financial year, companies listed in Annexure 5 to this Report have become or ceased to be the Company''s subsidiary, joint venture or associate companies.
ACQUISITIONS/ INCORPORATIONS/ OTHER CORPORATE RESTRUCTURINGS
The Company is committed to building long term shareholder value by growing the business inorganically and through acquisitions and alliances.
The Company was directly or indirectly involved in the following acquisitions, incorporations and corporate restructurings:
A. Acquisitions/ Incorporations
I. Travel Corporation (India) Limited, a wholly owned subsidiary (WOS) of the Company, on June 26, 2017 incorporated a WOS
- Horizon Travel Services LLC, USA (Horizon USA). Horizon USA on June 29, 2017, acquired identified assets (including the brand Allied T Pro) of Kuoni Destination Management USA Inc.
II. SOTC Travel Limited (formerly known as SOTC Travel Private Limited) and Travel Corporation (India) Limited, wholly owned subsidiaries of the Company on June 27, 2018 acquired 51% and 49% stake respectively in Travel Circle International (Mauritius) Limited (TCIM) a newly incorporated Joint Venture Company. Subsequently, on June 29, 2017, TCIM acquired 100% stake in identified Destination Management Specialist (DMS) entities of the Kuoni Group (located in 17 countries) from Kuoni Travel Investments Limited. The list of DMS entities acquired are mentioned in Annexure 5 of this Report under the head "Companies/ Bodies Corporate which have become Subsidiaries during the financial year 2017-18" from Sr. No. 1 to Sr. No. 21.
III. Travel Corporation (India) Limited, a wholly owned subsidiary of the Company, on June 19, 2017, subscribed to 49% of equity share capital of TCI-Go Vacation India Private Limited, a joint venture Company with DER Touristik Group which subscribed the remaining 51% of equity share capital of the Company.
IV. TC Tours Limited (formerly known as Thomas Cook Tours Limited), a wholly owned subsidiary of the Company, on October 30, 2017, acquired 100% stake in TC Travel And Services Limited from Tata Capital Limited.
V. The Company on October 30, 2017 acquired 100% stake in TC Forex Services Limited (formerly known as Tata Capital Forex Limited) from Tata Capital Limited.
B. Corporate Restructurings
I. The National Company Law Tribunal (NCLT), vide its order dated April 19, 2017, sanctioned the Composite Scheme of Arrangement and Amalgamation between SOTC Travel Services Private Limited (earlier known as Kuoni Travel (India) Private Limited), Distant Frontiers Tours Private Limited, SITA Beach Resorts Private Limited, SITA Destination Management Private Limited, SITA Holidays (India) Private Limited, SITA Holidays Resorts Private Limited and SITA Incoming (India) Private Limited), SOTC Travel Private Limited (since renamed as SOTC Travel Limited) and Travel Corporation (India) Limited. The Scheme was effective from June 1, 2017.
II. The Company, through an Offer For Sale, diluted its 5.42% investment stake in Ouess Corp Limited (Ouess). As on the date of this report, the Company holds 49.02% stake in Ouess.
III. The Company, on March 26, 2018, completed the acquisition of 100% stake in SOTC Travel Management Private Limited (formerly known as SITA Travels and Tours Private Limited) from SOTC Travel Limited (formerly known as SOTC Travel Private Limited), a wholly owned subsidiary of the Company.
IV. The Company on April 3, 2018 completed the acquisition of 100% stake in TC Travel And Services Limited from TC Tours Limited (formerly known as Thomas Cook Tours Limited), a wholly owned subsidiary of the Company.
V. The Company on April 13, 2018 subscribed to 303000 Optionally Convertible Cumulative Redeemable Preference Shares (OCCRPS) of Rs. 10 each offered by Sterling Holiday Resorts Limited, a wholly owned subsidiary of the Company.
VI. The Company on April 20, 2018 completed the acquisition of balance 4.44% equity stake in Travel Corporation (India) Limited (TCI) from Sterling Holiday Resorts Limited, a wholly owned subsidiary of the Company.
VII. The Board, at its meeting held on April 23, 2018, approved the Composite Scheme of Arrangement and Amalgamation amongst Thomas Cook (India) Limited (''TCIL''), Ouess Corp Limited (''QCL''), Travel Corporation (India) Limited (''TCI''), TC Forex Services Limited (formerly known as Tata Capital Forex Limited) (''TCF''), TC Travel and Services Limited (''TCTSL'') and SOTC Travel Management Private Limited (formerly known as SITA Travels and Tours Private Limited) (''SOTC Travel'') and their respective shareholders (''the Scheme'') in accordance with the provisions of Section 230 to 232 read with Section 52, 55 and 66 of the Companies Act, 2013. The Scheme inter-alia provides:
i. Demerger of the inbound business of TCI consisting of business of handling inward foreign tourist activity from TCI into SOTC Travel;
ii. Amalgamation of residual TCI, TCF and TCTSL with TCIL; and
iii. Demerger of the Human Resource Services Business of TCIL (including shares in QCL held by TCIL) into QCL. As a part of consideration, QCL will issue its shares to the shareholders of TCIL.
The said Composite Scheme is subject to requisite statutory and regulatory approvals and sanction by the respective shareholders of each of the companies involved in the Scheme.
VIII. Horizon Travel Holdings (Singapore) Private Limited, a wholly owned subsidiary of the Company was not undertaking any business operations and as the management had no plans to undertake any business in the Company going forward, the Company was wound up w.e.f. January 8, 2018.
AWARDS AND ACCOLADES
The Company has been the recipient of the following prestigious awards and accolades during the financial year 2017-18:
1) Best Travel Entrepreneur of the Year - TTG Travel Awards 2017
2) Best Outbound Tour Operator - Times Travel Awards 2018
3) Leading Tour Company with cutting edge travel innovations -Times Travel Awards 2018
4) Exemplary Achievements in Visa Issuance 2015-2017 -French Ambassador''s Diamond Award
5) Best Foreign Tour Operator (South Asia) for Malaysia Tourism Awards 2016/17
6) Amazing Thailand Award 2018
7) Overall outstanding support - Global - Marriot Excellence in Partnership Award 2017-18
8) Excellence in Domestic Tour Operations - Operations more than 5 Years Award'' - SATTE Awards 2018
9) Best Risk Management Practices at the 4th edition of The ICICI Lombard-CNBC TV18 India Risk Management Awards 2018 - travel and leisure category
10) Best Companies for Women in India 2017 - Working Mother & AVTAR 100
11) Highly commended winner of the Best SWIFT Solution Award at the Adam Smith Awards Asia 2017
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013
The Company has Zero Tolerance towards any action on the part of any employee which may fall under the ambit of ''Sexual Harassment'' at workplace, and is fully committed to uphold and maintain the dignity of every women executive working in the Company. The Company''s Policy provides for protection against sexual harassment of women at workplace and for prevention and redressal of such complaints.
Number of complaints pending as on the beginning Nil
of the financial year
Number of complaints filed during the financial year 1
Number of complaints pending as on the end Nil
of the financial year
INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUACY
The details on Internal Financial Control System and their adequacy are provided in the Management Discussion and Analysis Report of the Company, which forms part of the Annual Report.
PARTICULARS OF EMPLOYEES
Disclosure with respect to the remuneration of Directors and Employees as required under Section 197 of the Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is annexed as Annexure 6 which forms part of this Report.
Statement containing Particulars of Employees pursuant to Section 197 of the Companies Act, 2013 and Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, forms part of the Annual Report. As per the provisions of Section 136 of the Companies Act, 2013, the reports and Financial Statements are being sent to shareholders of the Company and other stakeholders entitled thereto, excluding the Statement containing Particulars of Employees. The copy of the said statement is available at the Registered Office of the Company during the business hours on any working day excluding Saturdays, Sundays and Public Holidays upto the date of Annual General Meeting. Any shareholder interested in obtaining such details may write to the Company Secretary & Compliance Officer of the Company. Further, the copies of the said statement shall also be available at the Annual General Meeting.
EMPLOYEES STOCK OPTION PLANS (ESOPS)
The Company after obtaining shareholders approval framed Thomas Cook Employees Stock Option Scheme 2018 - Execom (Execom ESOP 2018 Scheme) and Thomas Cook Employees Stock Option Scheme 2018 - Management (Management ESOP 2018 Scheme).
The objectives of the Schemes were as follows:
- Execom ESOP 2018 Scheme - to reward the EXECOM Employees of the Company for their performance and to motivate them to contribute to the growth and profitability of the Company.
- Management ESOP 2018 Scheme - to motivate and retain key talent in the organisation and fostering ownership and financial motivation.
The Company has in force the following Schemes which get covered under the provisions of SEBI (Share Based Employee Benefits) Regulations, 2014:
- Thomas Cook Employees Stock Option Plan 2007
- Thomas Cook Save As You Earn Scheme 2010
- Thomas Cook Employees Stock Option Plan 2013
- Sterling Holiday Resorts (India) Limited Employee Stock Options Scheme 2012
- Thomas Cook Employees Stock Option Scheme 2018 -Execom
- Thomas Cook Employees Stock Option Scheme 2018 -Management
During the financial year, no options were approved for grant under ESOP 2007, ESOP 2013 and SAYE Scheme 2010.
The above Schemes are in compliance with the SEBI (Share Based Employee Benefits) Regulations, 2014. The Company has also obtained the certificate from the Statutory Auditors of the Company certifying that the Company''s Employee Stock Option Scheme(s) have been implemented in accordance with the SEBI (Share Based Employee Benefits) Regulations, 2014, as amended and in accordance with the resolutions passed by the Members.
The Nomination & Remuneration Committee administers and monitors the ESOP Schemes. Disclosure on various Schemes, as required under SEBI (Share Based Employee Benefits) Regulations,
2014 read with SEBI Circular No. CIR/CFD/POLICY CELL/2/2015 dated June 16, 2015 are available on the Company''s website and the we blink thereto is https://resourfes.thomasmok.in/downloads/ Disclosure pursuant to SEBI(Share Based Employee Benefits) Regulations,2014 for the financial year 2017-18.pdf.
During the financial year, no employee has received options equal to or exceeding 1% of the issued share capital of the Company at the time of grant during the financial year.
SUBSIDIARY COMPANIES
In accordance with Section 129 of the Companies Act, 2013, the Company has prepared a consolidated financial statement of the Company and all its subsidiary and associate companies, which is forming part of the Annual Report. A statement containing salient features of the financial statements and other necessary information of the subsidiary/associate/ joint venture companies in the format prescribed under Form AOC-1 is included in the Annual Report. The said Form also highlights the financial performance of each of the subsidiaries/ associate/ joint venture companies included in the consolidated financial statements of the Company pursuant to Rule 8 of the Company (Accounts) Rules, 2014.
In accordance with the provisions of the Section 136 of the Companies Act, 2013, the Annual Report of the Company, containing therein its standalone and the consolidated financial statements has been placed on the website of the Company, www.thomascook. in. Further, as per the proviso of the said section, Annual Financial Statements of each of the subsidiary companies have also been placed on the website of the Company at www.thomascook.in.
Accordingly, the said documents are not being attached to the Annual Report. Shareholders interested in obtaining a copy of the Annual Financial Statements of the subsidiary companies may write to the Company Secretary & Compliance Officer of the Company.
DIVIDEND DISTRIBUTION POLICY
The Dividend Distribution Policy of the Company is annexed herewith as Annexure 7 and is also available on the website of the Company at www.thomascook.in.
BUSINESS RESPONSIBILITY REPORT
As required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Business Responsibility Report describing the initiatives undertaken by the Company from an environment, social and governance perspective forms part of the Annual Report.
DISCLOSURE REQUIREMENTS
The various policies and codes adopted by the Company are stated in detail in the Corporate Governance Report of the Company, which forms part of the Annual Report.
The Company during the financial year complied with the applicable provisions of the Secretarial Standards issued by the Institute of the Companies Secretaries of India.
ACKNOWLEDGEMENT AND APPRECIATION
Your Board takes this opportunity to thank the Company''s Shareholders, Customers, Vendors and all other Stakeholders for their continued support throughout the financial year. Your Directors also thank the Reserve Bank of India and other Banks, Ministry of Tourism, Financial Institutions, Government of India, State Governments and all other Government agencies and Regulatory authorities for the support extended by them and also look forward to their continued support in future.
Your Board also wishes to place on record its appreciation on the contribution made by the Company''s employees across all levels without whose hard work, solidarity and support, your Company''s consistent growth would not have been possible.
FOR AND ON BEHALF OF THE BOARD
Madhavan Menon Mahesh Iyer
Chairman & Managing Executive Director
Director & Chief Executive Officer
DIN: 00008542 DIN: 07560302
Place: Mumbai
Dated: May 29, 2018
Mar 31, 2017
To the Members,
The Directors have pleasure in presenting the Fortieth Annual Report, together with audited financial statements for the financial year ended on 31st March, 2017.
OVERVIEW
Travel and tourism has now become the largest civilian industry in the world. According to statistics, one out of every ten persons worldwide is part of the travel and tourism industry.
There have been changes in lifestyle, tastes, rising household incomes, which has had a positive effect and boost to the industry. The reach of the Internet has made it more convenient for customers with greater choices at competitive rates.
International traffic is expected to expand at 10-12% in 2017 and 2018, but bilateral restrictions may preclude achieving true potential. Most of the ten largest international carriers are achieving year-round average load factors of 90% or higher, indicating constrained capacity. As per The International Air Transport Association (IATA), the global passenger traffic rose by 6.3% for 2016 compared to 2015. This strong performance was well ahead of the ten-year average annual growth of 5.5% and capacity increasing by 6.2%. Air travel was a good news story in 2016. Connectivity increased with the establishment of more than 700 new routes. Fall in average return fares helped to make air travel even more accessible. As a result, a record 3.7 billion passengers flew to their destinations. Demand for air travel is still expanding. The challenge for governments is to work with the industry to meet that demand with infrastructure that can accommodate the growth, regulation that facilitates growth and taxes that donât choke the growth. (Source: IATA Passenger Traffic Results, 2016)
Asia has become the epicenter of growth for business travel. The region is already the worldâs largest market, accounting for more than a third of US$ 1 trillion in annual spending globally, and growth over the next few years is expected to dwarf that of other markets. By one estimate between 2014 and 2018, business travel spending in Asia is projected to grow four times as fast as in North America and more than twice as fast as in Europe. (Source: Asia Business Travellers - Mckinsey Report, 2015)
Travel and tourism is one of the largest service industries in India. It has tremendous potential as one of its key contributors to growth of the nation. India has emerged as the worldâs fastest-growing outbound market and in absolute numbers it is second only to China.
The year 2016-17 was definitely a year full of action, from Brexit, to Demonetization, stringent Visa policies by certain countries etc. Despite the sluggish global economy, poor customer sentiment and a challenging geo-political environment buffeted by terrorist attacks, travel bans etc., the Indian outbound, inbound and domestic tourism markets remained resilient. Given the challenges and economic environment, the year saw a strong performance across the Companyâs portfolio.
Your Company has moved rapidly in strengthening the online business over the last few years which currently contributes approximately 17% of the overall Leisure Travel business - uniquely positioning it in the industry with a versatile hybrid model with a well-spread store network and a very robust online business model, both of which, acquire and service offline and online customers.
Acquiring or reaching out to customers online has also helped us in reducing our cost of acquisition, while giving customers a seamless experience across all channels, resulting in improved customer satisfaction.
With an intent to building an annual property, we also introduced a mega promotional campaign called the GRAND INDIAN HOLIDAY SALE which customers could look forward to as it gave them unbeatable offers nudging them to take up a holiday. It was a 10-day sale across online and offline channels, backed by promotions across Print, Outdoor & Digital, which saw a close to 100% surge in online traffic and walk-ins at the stores during the campaign period.
EXPANDING NETWORK
As of 31st March, 2017, your Company, along with its subsidiaries, continues to be amongst the largest integrated travel groups in India. Your Company (exclusive of its subsidiaries) operates through 261 locations in 102 cities, 81 PSAs and 96 Gold Circle Partner outlets to have a wider spread and network across the country.
Your Company also has presence in countries outside India through its branches/ representative offices in USA (New York), Spain (Barcelona), UK (London), Japan (Tokyo & Osaka), China (Beijing), Hungary, Finland, Portugal, Italy, Germany, Brazil, Ukraine, Russia, Australia, Nepal, Bhutan and France (Paris) apart from its subsidiaries in Mauritius, Sri Lanka, Singapore and China (Hong Kong).
SUBSIDIARIES - KEY UPDATES & PERFORMANCE HIGHLIGHTS:
Quess Corp Limited (Quess), a subsidiary of your Company, reported an excellent growth in its operations and revenues. Quess went public on 12th July, 2016, raising Rs.4,000 million through a fully primary equity issuance in Indiaâs most successful IPO in terms of oversubscription (147 times) over the past 5 years. Quess saw Gross revenue up 21% from Rs.34.3 Bn during the 12 month period ended 31st March, 2016 to Rs.41.5 Bn for the 12 month period ended 31st March, 2017.
Sterling Holiday Resorts Limited (formerly known as Thomas Cook Insurance Services (India) Limited) (Sterling) undertook an extensive restructuring exercise, including a series of initiatives across business lines and subsidiaries. These long term measures are key components of the Groupâs plan to focus on sustainable long term growth. Sterling, has acquired a 100% stake in Nature Trails Resorts Private Limited on 15th March, 2016 as part of the expansion plan. The companyâs operating income grew by 12% from Rs.2.2 Bn in FY 2015-16 to Rs.2.5 Bn in FY 2016-17.
SOTC Travel Services Private Limited (formerly known as Kuoni Travel (India) Private Limited) (SOTC) grew its operational revenue for FY 201617 by 6% over FY 2015-16. Pursuant to the Order of NCLT, the Outbound Business Division of SOTC would be transferred to SOTC Travel Private Limited and the residual SOTC, which includes Leisure Inbound Business Division would thereafter be amalgamated with Travel Corporation (India) Limited. This scheme will become effective on completion of regulatory submissions.
Travel Corporation (India) Limited (TCI) is Indiaâs premier Destination Management Company with an impeccable record in all aspects of leisure inbound travel business in India, Sri Lanka, Nepal and Mauritius. Revenue from Operations has grown by 21.72% from Rs.1.6 Bn in 2015-16 to Rs.1.9 Bn in 2016-17. Pursuant to the Order of NCLT, the Outbound Business Division of SOTC would be transferred to SOTC Travel Private Limited and the residual SOTC, which includes Leisure Inbound Business Division would thereafter be amalgamated with TCI. This scheme will become effective on completion of regulatory submissions.
Travel Circle International Limited (formerly known as Luxe Asia Travel (China) Limited) acquired 100% stake in Travel Circle International Services Limited [formerly known as Kuoni Travel (China) Limited] is a premium outbound travel operator in Hong Kong. During the year, vertical amalgamation between Travel Circle International Limited and Travel Circle International Services Limited has become effective from 13th December, 2016. Revenue for FY 2016-17 stood at Rs.4.7 Bn. Since the company was amalgamated during the year, prior period figures are not comparable.
Thomas Cook Lanka (Private) Limited: The total income for FY 2016-17 reduced by 10% from Rs.113.9 mn in FY 2015-16 to Rs.102.3 mn due to increased costs and taxes.
Thomas Cook Mauritius: This financial year has seen good growth in foreign exchange operations. The Mauritius unit of Thomas Cook went ahead with an aggressive market strategy coupled with efficient management of costs exercise undertaken and the results could be visible in the form of increased profitability of the Company to the tune of 500%. The total income in FY 2016-17 increased by 22.9% to Rs.116.7 mn from Rs.95.0 mn in FY 2015-16.
THOMAS COOK (INDIA) LIMITED
Operations and Key Updates
Despite numerous geo-political and related challenges for our core Travel and Forex businesses, the Groupâs strong performance for the year, gives us further conviction that our strategy of organic and inorganic growth backed by the twin enablers of technology and innovation are working well. The synergistic advantages we had foreseen from our acquisition of SOTC, SITA and Kuoni Hong Kong in 2015 are also well on track to deliver.
PERFORMANCE HIGHLIGHTS:
Group Consolidated:
- Total Income increase of 41% from Rs.61.6 Bn. to Rs.86.8 Bn.
- PBT (before exceptional items) increased by 101.9% from Rs.947.7 Mn. to Rs.1,913.7 Mn.
- Book value increased from Rs.36.91 / share to Rs.49.11 / share (33% growth)
Group Travel Services:
- Operating Revenue from Travel businesses up 79.7% from Rs.21.8 Bn. to Rs.39.1 Bn.
- EBITDA increased by 56.9% from Rs.805.9 Mn. to Rs.1264.9 Mn. Standalone:
- Total income decreased by 0.86% from Rs.17,538.9 Mn to Rs.17,388.0 Mn
- Profit/ (Loss) before tax decreased from Rs.73.3 Mn. to Rs. (54.3) Mn.
- Profit/ (Loss) after tax decreased from Rs.53.8 Mn. to Rs. (83.5) Mn. OUTBOUND TRAVEL
Your Companyâs Leisure Outbound business underwent a re-structuring exercise aimed at strengthening core functions of sales, products and operations. To drive customer centricity, verticalization of the businesses was initiated, with dedicated functional divisions created for Service Delivery and Tour Operations Management. This restructuring was aimed at building a sound Omni Channel, hybrid model that embraces first time customers seeking physical interactions, hand holding and support as well as the growing base of digitally empowered Indian consumers by delivering a seamless experience across its large and strong physical network of branches and franchisees across the country, as well as its rapidly growing E Commerce vertical, www.thomascook.in that accounts for over 17% of its overall travel business.
Our physical network has been digitally empowered too with tablets and applications that allow sales staff to take the customer through a virtual walk through of the destinations and experiences that are on offer, check availability and book seamlessly.
On the Group Travel Front, we have introduced products targeting customers from various segments and regions of the country: Vegetarian Tours, Marathi Tours, Gujarati Tours, Festive Tours, Theme Parks Special for Children.
A paradigm shift in FIT products has been made in 2016 with new concepts launched including - âDo it yourselfâ itineraries for experienced travellers, âFamily Getawaysâ with theme parks, âLove Trailsâ for honeymooners, âGo Beyondâ with experiences beyond just sight-seeing, self-drive etc.
E-COMMERCE
The online channel now caters to all travel needs of the discerning traveller, like International Holidays, India Holidays, Foreign Exchange, Visa, Flights, Hotels and Travel Insurance. Considering the next-gen mobile audience, Thomas Cookâs E-Business had successfully launched innovative mobile applications i.e. the Forex App & the Holiday App. Its Forex and Holiday Apps has seen over 25% month over-month growths on downloads organically. Over 20% of sales of the online channel are contributed through Mobile web & apps. Your Companyâs belief and endeavor has been to give its customers a seamless omni-channel experience where the customer would get the same response to his sales or service queries and to achieve the same your Company has begun its journey in investing in the right technological innovations and enhancements.
This year, your Company took another leap and extended its line of âSimplyâ products (value for money products) to East Europe, Switzerland, France, Italy, Greece, Spain and many more destinations.
FOREIGN EXCHANGE
Your Company is one of Indiaâs largest foreign exchange dealers in both the wholesale and retail segments of the market, by virtue of its extensive network as well as sales, and one of the few non-banking institutions to have been granted an AD-II licence by the Reserve Bank of India. Your Company handles around 1.3 million transactions annually and is one of the largest exporters of bank notes globally.
During financial year 2016-17, overall Foreign Exchange business volumes decreased by 2% as compared to previous year. In the year 2015-16 Rupee has witnessed downward spiral on account of Chinese Yuan devaluation and slid to its weakest in two years. However 2016-17 was definitely an eventful year with lots of action across the world. We had major events during this year including Brexit and the Demonetization. All of these events had a significant impact on the markets.
Getting a large countrywide channel partner on board, coupled with strong focus on high engagement social media platforms including Facebook, Whatsapp and Twitter, helped the student business grow by 20%. The leisure travel trends for both group and individual travel business decreased by 14%. The âMaintenance of close relativesâ category of outward remittance saw degrowth of 1% on account of stringent regulatory compliance. Encashments have decreased by 15% over last year majorly due to decrease in Airport encashment by 22% on account of changing economic environment due to demonetization.
Your Company further strengthened its Inward Remittance business, both from a penetration perspective as well as from a business growth perspective. According to the issue of the World Bankâs âMigration and Development Briefâ, released on 21st April, 2017, with remittance flow around US$ 62.7 billion in 2016, India remained the worldâs largest recipient country.
Global remittances, which include those to high income countries, contracted by 1.2% to US$ 575 billion in 2016, from US$ 582 billion in 2015. Low oil prices and weak economic growth in the Gulf Cooperation Council (GCC) countries and the Russian Federation are taking a toll on remittance flows to South Asia and Central Asia, while weak growth in Europe has reduced flows to North Africa and Sub-Saharan Africa. âRemittances to India, the (South Asian) regionâs largest economy and the worldâs largest remittance recipient, decreased by 8.9% in 2016 to US$ 62.7 billion. This marks the first decline in remittances since 2009,â the World Bank report said. Your Company has degrown its inward remittance business by 16% over last year.
Your Companyâs own Multi Currency Prepaid Travel Card (Borderless Prepaid Card), launched in 2012 in association with MasterCard and Access Prepaid Worldwide, continued to grow at high double digit year on year growth rate. The Borderless Prepaid Card was loaded with US$ 329 million for the period 1st April, 2016 till 31st March, 2017 with an average monthly load of US$ 27 million. Over 260,000 cards have been sold since the launch of the product in 2012 with a total load volume of US$ 1101 million.
To keep pace with the changing needs of the customers and to ensure seamless delivery, your Company invested in new technology in 2016-17, ensuring better response times, improved management reporting and reduction of effort for the employees. Your Company will continue to enhance its technological backbone with the objective of customer service and delivery.
In a bid to transform the payment-solutions space, your Company, in December 2015, announced the launch of the âThomas Cook One Currency Cardâ -Indiaâs first prepaid travel card with zero cross currency conversion charges, in collaboration with MasterCard Worldwide. The Thomas Cook One Currency Card empowers customers with its USP of a single load currency (US$) and zero cross currency conversion charges, across the world.
Added benefits of the Thomas Cook One Currency Card include embedded chip and PIN security, locking of funds (to avoid cross currency fluctuations), instant loading, emergency cash disbursement, encashment of the residual balance or use for future travel, free replacement card in case stolen or lost and 24x7 global emergency assistance available via toll free access in over 80 countries global access via 2.2 million ATMâs and 35.2 million merchant establishments in over 275 countries.
FOREX ONLINE
The commencement of Thomas Cook Indiaâs âBuy Forex Onlineâ services has empowered travellers to buy their foreign exchange and Forex related products like the Thomas Cook Borderless Multicurrency Prepaid Card in a safe environment, at the click of a button and also the added convenience of home delivery via our portal www.thomascook.in.
At a click of a button, Thomas Cook provides buy/sell Foreign Exchange along with the products associated with it like Borderless prepaid card & One Currency Card. You can buy/Sell Forex @ thomascook.in and get a value added Service - free home delivery, rate alert option, & blocking rate by paying 4% advance amount. Forex transactions and sales through the online channel have grown by 48% and 35% respectively over the financial year 15-16.
INBOUND TRAVEL
The depreciated rupee made India an attractive tourist destination but inbound tourism did not grow as expected due to sluggish economic climate in source markets. Volatility in exchange rate, increasingly stringent compliance requirements, increasing competitive intensity, risk of obsolescence and adverse economic conditions are some key external factors that could impact the business adversely. Also, upward revision of rental costs of foreign exchange outlets at certain airports resulted in an overall reduction in margins in the retail foreign exchange business.
For over 50 years, Travel Corporation (India) Limited (TCI) has perfected the art of making the entire travel experience memorable. TCI is Indiaâs premier Destination Management Company with an impeccable record in all aspects of leisure inbound travel business in India, Sri Lanka, Nepal and Mauritius.
Post the acquisition of SOTC Travel Services Private Limited (formerly Kuoni Travel (India) Private Limited), its inbound division (KDM/ SITA) would add value and growth opportunities for this segment.
DOMESTIC
Domestic Travel at Thomas Cook India grew steadily on the back of a strong focus on product development and innovation. The strategy to introduce to the market other Himalayan destinations and experiences resulted in destinations like Bhutan, North East and Himachal Pradesh picking up and surpassing the booking numbers over last two year by over 55%. Strong and consistent destination with bigger potential for future too, still continues to grow upward with over 50% growth in booking in destinations like Andaman, Kerala and Ladakh. Government initiatives like âThe UDAN scheme and will fuel growth of travel industry and make air travel more affordable for people in tier 2 and 3 towns as well.
This scheme increase regional air connectivity and grow demand for domestic holidays with the coming up of new airports and air strips.
Pilgrimage journeys in the form of special interest market has also picked up in demand for the travelers all across India, destination and their related products like Kailash Mansarovar Yatra and char dham yatra have clocked some very positive numbers, we see a large potential for growth emerging in the near future in this section of the market.
CORPORATE TRAVEL
Your Company is seeing an increasing trend of corporate customers seeking to utilize our Online Booking Tool, rather than providing their booking requests offline through other means. They are realizing the benefits that the online tool can drive, which are related to policy compliance, cost savings and optimizing travel spend. With a buoyant business sentiment, corporates while exercising prudence and seeking to extract the maximum out of their travel budgets, have not put any restraints on cutting down of official travel, and trends continue to look positive.
MICE
MICE offers a potential for high revenue earning with limited resources. Business saw an upswing in financial year 2016-17 and took advantage of currency stabilization, tapping the demand for new destinations & experiential products. However, stringent visa policies in other destinations created a challenge. Despite intense competition amongst large and small players in the sector, MICE business has registered significant top line growth on the back of strong relationships with several corporate houses, by tapping new markets and clients. Focus on Domestic market resulted in strong growth in this space.
VISAS
TC Visa Services (India) Ltd. has exhibited both qualitative and quantitative growth in the year 2016-17. With around 2 million transactions for the year in 2016 observed a growth of 10% in direct business through and walk-in applicants and is growing at a steady pace capturing and setting a strong foot in the Visa business. Apart from catering to the Travel Businesses of your Company and adding direct external customers for their visa, passport business, it also serves ancillary transactions [Attestations, Legalization, Apostille, Translation, Notarization of documents, Foreigners Regional Registration Office (FRRO) registration/ visa extension/ exit permit, procures People of Indian Origin (PIO) / Overseas Citizen of India (OCI) cards].
VISA ONLINE
Thomas Cook has launched Visa online - the first visa application online platform in India. A comprehensive solution for all your Visa needs. Detailed visa information includes visa requirements per destination, downloadable visa forms, consulate addresses and timings, processing duration, and visa costs. Visa transactions and sales through the online channel have grown by 110% and 105% respectively in FY 2016-17 over FY 2015-16.
Your Company has launched services of booking Visa requests online on the Thomas Cook portal and through the call centre, which adds to the ease of the services provided to the travellers and growth of standalone Visa requests.
TRAVEL INSURANCE
Given the broad base of the discerning Thomas Cook customers who rely on Thomas Cook for end to end travel services, your Company offers both, domestic as well as overseas travel insurance. Your Company continues its focus on Travel Insurance with the strategy of being a complete travel solutions provider and to ensure that the customer is advised and educated about the benefits of travel insurance. Your Company tries to understand the specific needs of the customers and the business segments and offers the best product to suit their requirements.
Your Company has actively engaged with all the other lines of businesses like Leisure Travel, Foreign Exchange, MICE, Corporate Travel, VISA etc. by ways of regular training programs and deeper interactions to offer the products to their specific set of customers. This has helped in improving the penetration of insurance in every business, garnering higher share of customer wallet and building customer loyalty. With technology being the main driver, your Company continuously works towards making the process seamless and easy for its customers.
CENTRE OF LEARNING
Your Companyâs unique initiative to proactively facilitate talent management and to grow, harness and nurture the skill sets required for the Tourism and Travel Industry - Centre of Learning serves as a guide and mentor to the travel industry via several forums, industry meets and associated education programs like: Certificate Course in World Tour Management, Certificate Course in Travel & Tourism Management, IATA -Foundation/ Consultant Course, Travel Professional Program.
DIVIDEND
Equity Shares
The Directors recommend dividend for approval of the members on Equity shares @ 37.5% (i.e. Rs.0.375 per equity share of Rs.1/- each) for the financial year ended 31st March, 2017.
The proposed dividend on the equity share capital will absorb Rs.137.53 million for dividend and Rs.28 million for Dividend Tax. The Board seeks approval of the shareholders for the dividend recommended on the equity share capital as will be outstanding on the date of book closure/ record date.
Non Convertible Cumulative Redeemable Preference Shares (NCCRPS)
Pursuant to the terms of issue of NCCRPS, dividend on 125000000 NCCRPS of Rs.10/- each @ 8.5 %( i.e. Rs.0.85 per NCCRPS) will be paid by the Company to the respective NCCRPS holders.
The dividend on the NCCRPS will absorb Rs.106.54 million for dividend and Rs.21.69 million for Dividend Tax.
For the purpose of Indian Accounting Standard (Ind-AS) NCCRPS is considered as debt and consequently its dividend is classified under finance cost.
RESERVES
Debenture Redemption Reserve
As per the requirements, your Directors have resolved to transfer Rs.102.78 million to Debenture Redemption Reserve. The Company has transferred Rs.83.33 million during the year from Debenture Redemption Reserve to General Reserve. The total Debenture Redemption Reserve stands at Rs.253.36 million as on 31st March, 2017.
Capital Redemption Reserve
Your Directors have resolved to transfer Rs.178.57 million to Capital Redemption Reserve. The total Capital Redemption Reserve stands at Rs.238.10 million as on 31st March, 2017.
General Reserve
The Company has transferred Rs.83.33 million during the year from Debenture Redemption Reserve to General Reserve. The total General Reserve stands at Rs.436.97 million as on 31st March, 2017.
PROMOTERS
Fairfax Financial Holdings Limited
The promoter of your Company, Fairbridge Capital (Mauritius) Limited (âFCMLâ) is a 100% step down subsidiary of Fairfax Financial Holdings Limited (âFairfaxâ), Canada.
Fairfax is a holding company which, through its subsidiaries, is engaged in property, casualty insurance, reinsurance and investment management. Fairfax was founded in 1985 by the present Chairman and Chief Executive Officer, Mr. Prem Watsa. The Company has been under present management since 1985 and is headquartered in Toronto, Canada. Its common shares are listed on the Toronto Stock Exchange. Fairfaxâs corporate objective is to achieve a high rate of return on invested capital and build long-term shareholder value. Over the past 31 years, Fairfax has demonstrated a strong financial track record to achieve an annual compounded appreciation in book value per share of 19.4% and currently has over $ 43.3 billion in consolidated assets.
Thomas Cook (India) Limited is a part of the Fairfax group. As of date hereof, the promoter holds 67.65% of the total paid up equity share capital of the Company.
PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
Your Company being in the Travel and Tourism Industry, its activities do not involve any expenditure on Technology and Research and Development therefore, the particulars in the Companies (Accounts) Rules, 2014, as amended, in respect of Conservation of Energy and Technology Absorption are not required to be submitted.
During the financial year, the foreign exchange earnings of your Company amounted to Rs.333.24 million, whereas, your Company has incurred Rs.125.43 million as expenditure in foreign currencies towards interest, bank charges, license fees, professional fees, travelling, subscriptions etc.
DEPOSITS UNDER CHAPTER V OF COMPANIES ACT, 2013
During the financial year, the Company has not accepted any deposits within the meaning of Section 73 & 76 of the Companies Act, 2013, read with the Rules made thereunder, and as such, no amount of principal or interest was outstanding as of the Balance Sheet date.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the financial year, all the transactions with related parties were in the ordinary course of business and on an armâs length basis; and there were no material contracts or arrangements or transactions at armâs length basis or otherwise and thus disclosure in Form AOC-2 is not required.
DETAILS OF FRAUDS REPORTED BY AUDITORS
There were no frauds reported by the Statutory Auditors under provisions of Section 143(12) of the Companies Act, 2013 and the Rules made thereunder.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS OF THE COMPANY
There were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The particulars of Loans, Guarantees and Investments form part of the notes to the financial statements provided in the Annual Report.
REDEMPTION OF NON CONVERTIBLE DEBENTURES
The Company had issued and allotted 10.52% 1000 Unsecured Redeemable Non Convertible Debentures (âNCDsâ) of Rs.10 lakh each, aggregating to Rs.100 Crores on private placement basis during the financial year 2013. Out of total 1000 Non Convertible Debentures amounting to Rs.100 Crores, 333 Non Convertible Debentures were redeemed on 15th April, 2016 (under Tranche I) and 333 Non Convertible Debentures were redeemed on 15th April, 2017 (under Tranche II) as per terms of issue in the prescribed manner.
DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to Section 134(3) of the Companies Act, 2013, with respect to Directorsâ Responsibility Statement, it is hereby confirmed that:
i) in the preparation of the annual accounts for the financial year ended 31st March, 2017, the applicable accounting standards have been followed and there were no material departures;
ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on 31st March, 2017 and of the loss of the Company for the year ended on that date;
iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) the Directors have prepared the annual accounts on a going concern basis;
v) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
vi) the Directors have devised proper system to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
DIRECTORS
Re-appointment
In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Rules made thereunder and Article 116 of the Articles of Association of the Company, Mr. Harsha Raghavan (DIN: 01761512) Non Executive Director, retires by rotation at the ensuing Annual General Meeting of the Company and being eligible, offers himself for reappointment.
Profile and other information of Mr. Harsha Raghavan, as required under Regulation 36 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Secretarial Standard - 2 is given in the Corporate Governance Report of the Company which forms part of the Annual Report.
The above proposal for re-appointment forms part of the Notice of the 40th Annual General Meeting and the relevant Resolution is recommended for your approval therein.
Declaration of Independence
The Company has received necessary declarations from all the Independent Directors on the Board of the Company confirming that they meet the criteria of Independence as prescribed under Section 149(6) of the Companies Act, 2013 and the Rules made thereunder and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Board Evaluation
Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out an annual evaluation of the Board as a whole, various Committees, Directors individually and the Chairman.
The statement including the manner in which the evaluation exercise was conducted is included in the Corporate Governance Report of the Company, which forms part of the Annual Report.
Number of Board Meetings during the financial year
During the financial year, Five (5) meetings of the Board of Directors were held, the details of which are given in the Corporate Governance Report of the Company, which forms a part of the Annual Report.
KEY MANAGERIAL PERSONNEL
Mr. Mahesh Iyer, Chief Operating Officer of the Company was appointed as Chief Executive Officer of the Company w.e.f. 14th February, 2017.
The Nomination and Remuneration Committee, Audit Committee and Board of Directors at their meetings respectively held on 25th May, 2017 approved the appointment of Mr. Brijesh Modi as the Chief Financial Officer of the Company w.e.f. 1st June, 2017 in place of Mr. Debasis Nandy, Chief Financial Officer & President - Commercial who was proposed to be elevated to the position of President & Group Chief Financial Officer of Thomas Cook Group w.e.f. 1st June, 2017.
AUDITORS Statutory Auditors
Lovelock & Lewes, Chartered Accountants, Firm Registration No. 301056E were first appointed as Statutory Auditors at Companyâs Annual General Meeting (AGM) held on 15th May, 1997. Currently, they are holding office of the Auditors up to the conclusion of the 40th AGM.
As per the second proviso to Section 139(2) of the Companies Act, 2013 (the Act), a transition period of three years from the date of commencement of the Act is provided to appoint a new auditor if the existing auditorâs firm has completed two terms of five consecutive years.
Accordingly, as per the said requirements of the Act, the Board and Audit Committee have proposed the appointment of B S R & Co. LLP, Chartered Accountants (Firm Registration No. 101248W/W - 100022) as Statutory Auditors for a period of 5 years commencing from the conclusion of 40th AGM till the conclusion of the 45th AGM, subject to ratification by shareholders every year, in place of Lovelock & Lewes, Chartered Accountants. The first year of audit for B S R & Co. LLP will be of the financial statements for the financial year ended 31st March, 2018, which will include limited review of all the quarters of the said financial year. The Board expresses its appreciation to Lovelock & Lewes, Chartered Accountants for their services to the Company during their association with the Company.
B S R & Co. LLP, Chartered Accountants, have consented to the said appointment and confirmed that their appointment, if made, would be within the limits specified under Section 141(3)(g) of the Act. They have further confirmed that they are not disqualified to be appointed as statutory auditor in terms of the provisions of Section 139 and Section 141 of the Act and the provisions of the Companies (Audit and Auditors) Rules, 2014, as amended.
The Statutory Auditors Report does not contain any qualifications, reservations or adverse remarks on the financial statements of the Company. Further, your Company also obtained Statutory Auditors Report as per the requirement of circulars issued by Reserve Bank of India from time to time in relation to downstream investments.
Secretarial Auditor
The Board of Directors have appointed Mr. Keyul M. Dedhia of Keyul M. Dedhia & Associates, Company Secretaries in Practice as the Secretarial Auditor of the Company under Section 204 of the Companies Act, 2013, for conducting the Secretarial Audit for the financial year 2016-17.The Secretarial Audit Report for the financial year 2016-17 does not contain any adverse remark, qualification or reservation which requires any explanation/comments by the Board. The Secretarial Audit Report is annexed as Annexure 1 which forms part of this Report.
Internal Auditor
During the financial year, Ms. Mou Sengupta, Chief Internal Auditor of the Company resigned from the services of the Company and in her place Mr. Aniruddha Chaudhuri was appointed as the Chief Internal Auditor of the Company w.e.f. 25th May, 2017.
CORPORATE SOCIAL RESPONSIBILITY
Corporate Social Responsibility (CSR) Committee:
In compliance with the requirements of Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility) Rules, 2014, as amended, the Board of Directors have constituted a CSR Committee. The details of the Committee are provided in the Corporate Governance Report of the Company, which forms part of the Annual Report.
CSR Policy:
The contents of the CSR Policy of the Company as approved by the Board on the recommendation of the CSR Committee is available on the website of the Company and can be accessed through the web link: http://www.thomascook.in/tcportal/downloads/Corporate%20Social%20 Responsibility%20Policy.pdf.
CSR initiatives undertaken during the financial year 2016-17:
During the financial year 2016-17, the Company has spent Rs.99,40,266/- on CSR activities.
The Annual Report on CSR Activities undertaken by Company during the financial year 2016-17, is annexed as Annexure 2 which forms part of this Report.
COMMITTEES OF BOARD
The Board of Directors has constituted the following committees and the details pertaining to such committees are mentioned in the Corporate Governance Report of the Company, which forms part of the Annual Report.
- Audit Committee
- Nomination and Remuneration Committee
- Stakeholders Relationship Committee
- Corporate Social Responsibility Committee
- Sub-Committee of the Board LISTING OF SECURITIES
The Company has its following Securities listed on the Stock Exchanges viz. BSE Limited and The National Stock Exchange of India Limited:
- Equity Shares
- Non Convertible Cumulative Redeemable Preference Shares (âNCCRPSâ)
- Non Convertible Debentures (âNCDsâ)
The Company has paid the Annual Listing Fees for the financial year under review for all securities to the Stock Exchanges.
CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Your Company continues to be committed to good corporate governance aligned with the best corporate practices. It has also complied with various standards set out by Securities and Exchange Board of India and the Stock Exchanges where it is listed. The Management Discussion and Analysis Report for the financial year 2016-17, as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual Report.
For the financial year ended 31st March, 2017, your Company has complied with the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and other applicable rules and regulations with respect to Corporate Governance.
A certificate from a Practising Company Secretary obtained by the Company regarding such compliance of conditions of Corporate Governance is annexed to the Corporate Governance Report which forms part of the Annual Report.
NOMINATION CUM REMUNERATION POLICY
For the purpose of selection of any Directors and Key Managerial Personnel, the Nomination & Remuneration Committee identifies persons of integrity who possess relevant expertise, experience and leadership qualities required for the position. The Committee also ensures that the incumbent fulfils such other criteria with regard to age and other qualifications as laid down under the Companies Act, 2013 or other applicable laws. The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection, appointment and remuneration of Directors, Key Managerial Personnel & Senior Management Employees. In compliance with the provisions of Section 178 of the Companies Act, 2013 the Nomination cum Remuneration Policy of the Company and Performance Criteria is annexed herewith as Annexure 3 which forms part of this Report.
VIGIL MECHANISM
The Company has established a vigil mechanism for Directors and employees by adopting Whistle Blower Policy which is available on the website of the Company and weblink thereto is http://www.thomascook. in/tcportal/downloads/Whistle%20Blower%20Policy.pdf.
MATERIAL CHANGES AND COMMITMENTS
There were no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year and the date of the Report.
RISK MANAGEMENT
The Company has adopted a Risk Management Policy which lays down the framework to define, assess, monitor and mitigate the business, operational, financial and other risks associated with the business of the Company.
EXTRACT OF ANNUAL RETURN
Pursuant to the provisions of section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, as amended, extract of the Annual Return of the Company in the prescribed Form MGT-9 is annexed as Annexure 4 to this Report.
INCORPORATIONS/ ACQUISITIONS/ OTHER CHANGES
Your Company is committed to building long term shareholder value by growing the business organically and through acquisitions and alliances. The key considerations for making any acquisition are as under:
- Cash flow generating businesses with proven track records across business cycles.
- Stable management teams who are aligned with our guiding principles and culture.
- Fair and friendly transactions with full support of the existing management teams.
I. Formation of Fairfax India Charitable Foundation for carrying out Corporate Social Responsibility (CSR) activities in which Thomas Cook (India) Limited is one of the settlors of the trust along with Travel Corporation (India) Limited, SOTC Travel Services Private Limited (formerly known as Kuoni Travel (India) Private Limited) and Fairbridge Capital Private Limited.
II. Thomas Cook (India) Limited acquired 10,000 equity shares of Rs.10 each of SOTC Travel Private Limited (Formerly known as SITA Travels Private Limited).
III. Thomas Cook Lanka (Private) Limited, Wholly owned subsidiary of the Company entered into share purchase agreement for acquiring 24% of the issued, subscribed and paid up share capital of SITA World Travel Lanka Private Limited. The balance 76% held by SOTC Travel Services Private Limited (formerly known as Kuoni Travel (India) Private Limited).
IV. As Thomas Cook (Mauritius) Travel Limited was not undertaking any operations and as the management had no plans to undertake any business in the company going forward, the company was wound up w.e.f. 13th October, 2016.
V. Vertical amalgamation between Travel Circle International Limited (Formerly known as Luxe Asia Travel (China) Limited and Travel Circle International Services Limited (Formerly known as Kuoni Travel (China) Limited) w.e.f. 13th December, 2016.
VI. Approval of National Company Law Tribunal for merger of outbound business of SOTC Travel Services Private Limited (formerly known as Kuoni Travel (India) Private Limited) with SOTC Travel Private Limited (formerly known as SITA Travels Private Limited) and merger of residual business of SOTC Travel Services Private Limited, and 6 SITA Companies namely SITA Beach Resorts Private Limited, SITA Destination Management Private Limited, SITA Holidays (India) Private Limited, SITA Holidays Resorts Private Limited, SITA Incoming (India) Private Limited and Distant Frontiers Tours Private Limited merged with Travel Corporation (India) Limited.
VII. Acquisitions of facility management and catering businesses of Manipal Integrated Services Private Limited (yet to be completed), Comtel Solutions Pte Ltd (64% stake as on 31st March, 2017), Terrier Security Services (India) Private Ltd (49% stake as on 31st March, 2017) and Inticore VJP Advance Systems Private Limited (74% stake as on 31st March, 2017).
VIII. Investment in Simpliance Technologies Private Limited and Heptagon Technologies Private Limited by Quess Corp Limited.
IX. Travel Corporation (India) Limited and SOTC Travel Private Limited (formerly known as SITA Travels Private Limited), wholly owned subsidiaries of the Company, have entered into a definitive agreement to acquire identified Destination Management Specialists (DMS) of the Kuoni Group (located in 17 countries) from Kuoni Travel Investments Limited, Zurich, Switzerland and / or its affiliates. Said acquisition of all the DMS is on a going concern basis and that SOTC Travel Private Limited and Travel Corporation (India) Limited will acquire 100% stake in all the DMS (excluding those DMS where local regulations mandate local participation) except for USA, where an asset acquisition will be undertaken, subject to receiving necessary regulatory permissions.
X. Travel Corporation (India) Limited, wholly owned subsidiary of the Company has entered into a Joint Venture Agreement with DER Touristik Group to form a Joint Venture Company âTCI-Go Vacation India Private Limitedâ to be operational from Delhi NCR.
COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE FINANCIAL YEAR
During the financial year following Companies have become subsidiaries of the Company:
Sr. No. |
Name |
Subsidiary / Step down Subsidiary |
Address |
CIN |
1. |
CentreQ Business Services Private Limited |
Step down Subsidiary |
3/3/2, Bellandur Gate, Sarjapur Main Road, Bangalore-560103. |
U72200KA2016PTC097679 |
2. |
Dependo Logistics Solutions Private Limited |
Step down Subsidiary |
3/3/2, Bellandur Gate, Sarjapur Main Road, Bangalore-560103. |
U63030KA2016PTC096361 |
3. |
Excelus Learning Solutions Private Limited |
Step down Subsidiary |
3/3/2, Bellandur Gate, Sarjapur Main Road, Bangalore-560103. |
U74999KA2016PTC097984 |
4. |
Inticore VJP Advance Systems Private Limited |
Step down Subsidiary |
3/3/2, Bellandur Gate, Sarjapur Main Road, Bangalore-560103. |
U33112KA2016PTC086889 |
5. |
Comtel Solutions Pte. Ltd., Singapore |
Step down Subsidiary |
10, Hoe Chiang Road, #15-02 Keppel Towers, Singapore, 089315 |
N.A. |
6. |
Quess Corp Lanka (Private) Limited (formerly known as Randstad Lanka (Private) Limited) |
Step down Subsidiary |
7th Floor, BOC Merchant Tower, 28, St. Michaelâs Road, Colombo 03, Sri Lanka |
N.A. |
During the financial year following Companies have ceased to be subsidiaries of the Company:
Sr. No. |
Name |
Subsidiary / Step down Subsidiary |
Address |
CIN |
1. |
KAT Management Consulting (Shanghai) Co. Limited |
Step down Subsidiary |
RM A-509 Block 6, 613 Eshan Road, Pudong, Shanghai |
N.A. |
2. |
Brainhunter Companies Canada, Inc. |
Step down Subsidiary |
2 Sheppard Avenue East, Suite 2000, Toronto, ON M2N 5Y7, Canada |
N.A. |
3. |
Travel Circle International Services Limited (formerly known as Kuoni Travel (China) Limited) |
Step down Subsidiary |
30/F, AXA Tower, Landmark East, 100 How Ming Street, Kwun Tong, Kowloon, Hong Kong |
N.A. |
4. |
Thomas Cook (Mauritius) Travel Limited |
Step down Subsidiary |
Ground Floor, Anglo Mauritius House, 4 Intendance Street, Port Louis, Mauritius |
N.A. |
During the financial year under review there were following joint venture or associate companies:
Sr. No. |
Name |
Subsidiary / Step down Subsidiary |
Address |
CIN |
1. |
Terrier Security Services (India) Private Limited* |
Associate Company |
No. 583, Vyalikaval HBCS Layout, Nagawara, Veerannapalya Bangalore 560045 |
U74920KA2009PTC049810 |
2. |
Simpliance Technologies Private Limited* |
Associate Company |
2nd Floor, AS Chambers, No.6 80 Feet Road, Koramangala Bangalore 560095 |
U72200KA2016PTC092594 |
3. |
Himmer Industrial Services (M) Sdn. Bhd.* |
Associate Company |
17 - 11 Level 17 Q Central Jalan Stesen Sentral 50470 Kuala Lumpur |
N.A. |
*Associate companies of Quess Corp Limited, a Subsidiary of the Company
ALTERATION OF MEMORANDUM OF ASSOCIATION OF COMPANY
During the financial year, after seeking necessary approval of shareholders in the Annual General Meeting of the Company held on 2nd September, 2016, Object Clause of Memorandum of Association was altered to widen the existing enabling clause which allows the Company to undertake necessary activities under Corporate Social Responsibility (CSR).
AWARDS AND ACCOLADES
Thomas Cook (India) Limited has been the recipient of the following prestigious awards and accolades during the financial year 2016-17:
1) The French Ambassadorâs Diamond Award for Exemplary Achievements in Visa Issuance 2016
2) Conde Nast Traveller Readersâ Travel Awards 2016
3) Thomas Cook Indiaâs Centre of Learning has received IATA accreditation as Top 10 South Asia IATA Authorized Training Centers 2016
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013
Thomas Cook (India) Limited has Zero Tolerance towards any action on the part of any employee which may fall under the ambit of âSexual Harassmentâ at workplace, and is fully committed to uphold and maintain the dignity of every women executive working in the Company. The Companyâs Policy provides for protection against sexual harassment of women at workplace and for prevention and redressal of such complaints.
Number of complaints pending as on the beginning of the financial year Nil
Number complaints filed during the financial year 5
Number of complaints pending as on the end of the financial year Nil
INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUECY
The details on Internal Financial Control System and their adequacy are provided in the Management Discussion and Analysis Report of the Company, which forms part of the Annual Report.
PARTICULARS OF EMPLOYEES
Disclosure with respect to the remuneration of Directors and Employees as required under Section 197(12) of the Companies Act, 2013 and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is annexed as Annexure 5 which forms part of this Report.
Statement containing Particulars of Employees pursuant to Section 197(12) of the Companies Act, 2013 and Rule 5(2), Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, forms part of the Annual Report. As per the provisions of Section 136 of the Companies Act, 2013, the reports and Financial Statements are being sent to shareholders of the Company and other stakeholders entitled thereto, excluding the Statement containing Particulars of Employees. The copy of the said statement is available at the Registered Office of the Company during the business hours on any working day excluding Saturdays, Sundays and Public Holidays upto the date of Annual General Meeting. Any shareholder interested in obtaining such details may write to the Company Secretary and Compliance Officer of the Company. Further, the copies of the said statement shall also be available at the Annual General Meeting.
EMPLOYEES STOCK OPTION PLANS (ESOPS)
With the objective of motivating and retaining key talent in the organisation and fostering ownership, your Company has framed the Thomas Cook Employees Stock Option Plan 2007 (ESOP 2007) and Thomas Cook Employees Stock Option Plan 2013 (ESOP 2013) and pursuant to the same, has granted stock options to its employees over the years.
The Company has also framed the Thomas Cook Save As You Earn Scheme 2010 (SAYE Scheme 2010) with similar objectives. SAYE Scheme 2010 allowed employees to save a part of their net pay every month which gets deposited with a bank in a recurring deposit account carrying fixed rate of interest.
During the financial year, 802868 options were approved for grant under the ESOP 2013. However, there were no options approved for grant under SAYE Scheme 2010 and ESOP 2007.
Pursuant to the Composite Scheme of Arrangement and Amalgamation between Sterling Holiday Resorts (India) Limited (âSHRILâ), Thomas Cook Insurance Services (India) Limited (âTCISILâ) and Thomas Cook (India) Limited (the âCompanyâ or âTCILâ) approved by the Honâble High Courts of Madras and Bombay, 430326 employee stock options of TCIL were issued in lieu of outstanding employee stock options under SHRIL Employees Stock Option Scheme, 2012.
The Nomination & Remuneration Committee administers and monitors the ESOP Schemes. Disclosure on various Schemes, as required under SEBI (Share Based Employee Benefits) Regulations, 2014 read with SEBI circular no. CIR/CFD/POLICY CELL/2/2015 dated 16th June, 2015 are available on the Companyâs website at www.thomascook.in.
No employee has received options equal to or exceeding 1% of the issued share capital of the Company at the time of grant during the financial year.
SUBSIDIARY COMPANIES
In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements of the Company and all its subsidiary and associate companies, which forms part of the Annual Report. A statement containing salient features of the financial statements and other necessary information of the subsidiary companies in the format prescribed under Form AOC-1 is included in the Annual Report.
In accordance with third proviso of Section 136(1) of the Companies Act, 2013, the Annual Report of the Company, containing therein its standalone and the consolidated financial statements has been placed on the website of the Company at www.thomascook.in. Further, as per the fourth proviso of the said Section, Financial Statements of each of the subsidiary companies have also been placed on the website of the Company at www.thomascook.in. Accordingly, the said documents are not being attached to the Annual Report. Shareholders interested in obtaining a copy of the Audited Annual Financial Statements of the subsidiary companies may write to the Company Secretary and Compliance Officer.
As stipulated in the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the consolidated financial statements have been prepared by the Company in accordance with the applicable Accounting Standards.
DIVIDEND DISTRIBUTION POLICY
Pursuant to Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the top 500 listed companies were required to formulate a Dividend Distribution Policy. Accordingly, the Policy was formulated and the same approved by the Board of Directors, setting out the parameters and circumstances required to be taken into account for determining the distribution of dividend to its shareholders and/ or retaining profits earned by the Company. The Dividend Distribution Policy of the Company is annexed herewith as Annexure 6 and is also available on the website of the Company at www.thomascook.in.
BUSINESS RESPONSIBILITY REPORT
As required under SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, Business Responsibility Report describing the initiative taken by the Company from an environment, social and governance perspective, forms part of the Annual Report.
DISCLOSURE REQUIREMENTS
The various policies and codes adopted by the Company are stated in detail in the Corporate Governance Report of the Company, which forms part of the Annual Report.
ACKNOWLEDGEMENT AND APPRECIATION
Your Board takes this opportunity to thank the Companyâs Shareholders, Customers, Vendors and all other Stakeholders for their continued support throughout the financial year. Your Directors also thank the Reserve Bank of India and other Banks, Ministry of Tourism, Financial Institutions, Government of India, State Governments and all other Government agencies and Regulatory authorities for the support extended by them and also look forward to their continued support in future.
Your Board wishes to place on record its appreciation on the contribution made by the Companyâs employees across all levels without whose hard work, solidarity and support, your Companyâs consistent growth would not have been possible.
FOR AND ON BEHALF OF THE BOARD
Madhavan Menon
Chairman & Managing Director
(DIN: 00008542)
Place: Mumbai
Dated: 25th May, 2017
Mar 31, 2016
The Directors have pleasure in presenting the Thirty - Ninth Annual
Report, together with audited financial statements for the financial
year ended on 31st March, 2016.
FINANCIAL PERFORMANCE
(Rs. in million except Earnings Per Share)
Standalone Consolidated*
Particulars Financial Fifteen months Financial Fifteen months
Year ended Period ended Year ended Period ended
31st March,
2016 31st March, 31st March,
2016 31st March,
2015** 2015**
Total Revenue 4,125.77 5,135.82 42,835.58 32,863.21
Profit before
Tax 84.32 486.21 1,282.09 1,709.88
Exceptional Item - - 938.50 -
Prior Period Item - - 58.46 -
Provision for
Taxation - 157.00 733.58 517.19
MAT Credit
Entitlement - - - 16.96
(Write back) /
Provision for
Deferred
Taxation and
Tax 2.99 (2.90) (282.47) 52.35
pertaining to
earlier periods
Profit after
Taxation 81.33 332.11 - -
(Loss)/Profit
after Taxation
and before
Minority
Interest - - (165.98) 1,123.38
Minority Interest - - 213.34 221.87
(Loss)/Profit
after Taxation
and Minority
Interest - - (379.31) 901.51
Transferred to
General Reserve - 33.21 - 33.21
Dividend
Proposed / Paid 172.67 138.61 172.67 138.61
Earnings Per
Share - Basic
(per equity
share of
Rs.1/- each) 0.12 1.31 (1.30) 3.56
Earnings Per
Share - Diluted
(per equity
share of
Rs.1/- each) 0.12 1.10 (1.30) 2.98
* Consolidated financial statements for the financial year ended 31st
March, 2016, included the consolidated audited financial statements of
companies acquired during the financial year, mainly SOTC Travel
Services Private Limited (SOTC) (formerly known as Kuoni Travel (India)
Private Limited'') for the period 1st January, 2016 to 31st March, 2016
and Kuoni Travel (China) Limited for the period 1st November, 2016 to
31st March, 2016. Accordingly said figures are not comparable with
previous period.
In the previous period, the consolidated financial statements for the
period ended 31st March, 2015, included the consolidated financial
statements of Sterling Holiday Resorts (India) Limited for the period
3rd September, 2014 to 31st March, 2015. Consequently, consolidated
financial statements for the financial year ended 31st March, 2016 are
not comparable with previous period.
** Previous period figures have been reclassified wherever necessary to
conform to this year''s classification.
OPERATIONS & RESULTS
The travel and tourism industry has emerged as one of the key drivers
of growth among the service sectors of the country. It is potentially a
large employment generator besides being a significant source of
foreign exchange for the country. This sector has a significant
potential considering the rich cultural and historical heritage,
variety in ecology, terrains and places of natural beauty spread across
the country. Despite fluctuations in rupee value, overall business
sentiment and economic outlook remained optimistic. The year saw decent
growth of your Company''s portfolio of retail products, strong leisure
travel trends for both group and individual travel business and the
outreach program with channel partners. Retail inflation has softened
due to declining oil prices, weak domestic demand. Easing inflationary
pressures strengthened the impact of comfortable liquidity conditions
on market interest rates.
Your Company recorded total revenue of Rs.4,125.77 million and profit
before tax of Rs.84.32 million with profit after tax being Rs.81.33
million for the financial year ended 31st March, 2016. The basic
earnings per share of the Company is Rs.0.12 per Equity Share of Rs.1/-
each.
THOMAS COOK PRESENCE
As of 31st March, 2016, your Company, along with its subsidiaries,
continues to be amongst the largest integrated travel groups in India.
Your Company (exclusive of its subsidiaries) operates through 227
locations in 91 cities, 112 PSAs and 114 Gold Circle Partner outlets to
have a wider spread and network across the country.
Your Company also has presence in 7 countries outside India through its
branches/ representative offices in USA (New York), Spain (Barcelona),
UK (London), Japan (Tokyo & Osaka), China (Beijing), South Korea
(Seoul) and France (Paris) apart from its subsidiaries in Mauritius,
Sri Lanka, Singapore and China (Hong Kong).
SHARE CAPITAL STRUCTURE
Share Capital structure as of 28th May, 2016
Authorised Capital: Rupees (Rs.) Rupees (Rs.)
Equity Shares:
1335000000 Equity Shares of
Rs.1/- each 1,335,000,000
Preference Shares:
250000000 Preference Shares of
Rs.10/- each 2,500,000,000
3,835,000,000
issued, Subscribed and Paid-up
Capital:
Equity Shares:
365972979 Equity Shares of
Rs.1/- each 365,972,979
Preference Shares:
125000000 Non Convertible
Cumulative Redeemable Preference
Shares of Rs.10/- each 1,250,000,000
1,615,972,979
During the financial year:
1. 4423000 Compulsory Convertible Preference Shares (CCPS) of Rs.10/-
each were converted into 44230000 Equity Shares of Rs.1/- each on 8th
September, 2015.
2. The Authorised Share Capital of the Company was re-classified
pursuant to the approval of shareholders vide Extraordinary General
Meeting of the Company held on 27th November, 2015.
3. The Company has issued & alloted 125000000 Non Convertible
Cumulative Redeemable Preference Shares of Rs.10/- each aggregating to
Rs.1,250 million on 1st December, 2015.
4. The Company has alloted 48657929 equity shares of Rs.1/- each to
the shareholders of Sterling Holiday Resorts (India) Limited pursuant
to Sanctioned Composite Scheme of Arrangement and Amalgamation between
Thomas Cook Insurance Services (India) Limited, Sterling Holiday
Resorts (India) Limited & the Company on 3rd September, 2015.
DIVIDEND
Your Directors recommend dividend for approval of the members as under:
1. On 4423000 Compulsorily Convertible Preference Shares (CCPS) of
Rs.10/- each @ 0.001% (i.e Rs.0.0001 per CCPS) for the period from 1st
April, 2015 to 8th September, 2015 (upto the date of conversion);
2. On Equity Shares @ 37.5% (i.e. Rs.0.375 per share) on each equity
share of Rs.1/- for the financial year ended 31st March, 2016;
3. On 125000000 Non Convertible Cumulative Redeemable Preference
Shares (NCCRPS) of Rs.10/- each @ 8.5 %( i.e. Rs.0.85 per NCCRPS) for
the period from 1st December, 2015 (date of allotment) to 31st March,
2016.
The proposed dividend on the equity share capital and preference share
capital will absorb Rs.172.67 million for dividend and Rs.35.15 million
for Dividend Tax. The Board seeks the approval of the shareholders to
the dividend recommended on the preference and equity share capital as
will be outstanding on the date of book closure/ record date.
RESERVES
Debenture Redemption Reserve
As per requirement, your Directors have resolved to transfer Rs.103.36
million to Debenture Redemption Reserve. The total Debenture Redemption
Reserve stand at Rs.233.91 million as at 31st March, 2016.
Capital Redemption Reserve
Further, as per requirement, your Directors have resolved to transfer
Rs.59.52 million to Capital Redemption Reserve. The total Capital
Redemption Reserve stand at Rs.59.52 million as at 31st March, 2016.
General Reserve
Your Directors have decided to retain the profits of the Company. The
total General Reserves stand at Rs.353.64 million as at 31st March,
2016.
PROMOTERS
Fairfax Financial Holdings Limited
The current promoter of your Company, Fairbridge Capital (Mauritius)
Limited ("FCML") is a 100% step down subsidiary of Fairfax Financial
Holdings Limited ("Fairfax"), Canada. During the financial year, M/s. H
Investment Limited, former promoter of the Company, has transferred its
complete shareholding to FCML.
Fairfax is a holding company which, through its subsidiaries, is
engaged in property and casualty insurance and reinsurance and
investment management. Fairfax was founded in 1985 by the present
Chairman and Chief Executive Officer, Mr. Prem Watsa. The Company has
been under present management since 1985 and is headquartered in
Toronto, Canada. Its common shares are listed on the Toronto Stock
Exchange. Fairfax''s corporate objective is to achieve a high rate of
return on invested capital and build long-term shareholder value. Over
the past 30 years, Fairfax has demonstrated a strong financial track
record to achieve an annual compounded appreciation in book value per
share of 20.4% and currently has over $ 41.5 billion in consolidated
assets.
Thomas Cook (India) Limited is a part of the Fairfax group. As of the
date hereof, the promoter holds 67.81% of the total paid up equity
share capital of the Company.
THOMAS COOK (INDIA) LIMITED
Operations in India [including subsidiaries]
Your Company is one of India''s largest foreign exchange dealers in both
the wholesale and retail segments of the market, by virtue of its
extensive network as well as sales, and one of the few non-banking
institutions to have been granted an AD-II licence by the Reserve Bank
of India. Your Company handles 1.3 million transactions annually and is
one of the largest exporters of bank notes globally.
However in the current year, the Rupee has witnessed a downward spiral
on account of Chinese Yuan devaluation and slid to its weakest in two
years. The global economic slowdown, Chinese Yuan devaluation, turmoil
seen over Greek economic crisis and Rupee depreciation against USD,
impacted Indian economy. Despite the trading environment, your Company
has managed to maintain its previous year volumes. The year saw
appreciable growth of your Company''s portfolio of retail products.
Getting a large countrywide channel partner on board, coupled with
strong focus on high engagement social media platforms including
Facebook and Twitter, helped the student business grow by 23%. The
leisure travel trends for both group and individual travel business and
the outreach program with channel partners managed to sustain at
previous year level. The ''Maintenance of close relatives'' category of
outward remittance saw degrowth of 20% on account of stringent
regulatory compliance. Owing to rupee depreciation, encashments have
increased by 7% over last year.
Your Company continued focus on acquisition of new clients and strived
to provide un-paralleled customer service along with a suite of
products, however demand of Forex from Corporates has reduced, leading
to a degrowth of 10%. Your Company further strengthened its Inward
Remittance business, both from a penetration perspective as well as
from a business growth perspective. According to the issue of the World
Bank''s ''Migration and Development Brief'', released on 13th April, 2016,
with remittance flow around $69 billion in 2015, India remained the
world''s largest recipient country. Global remittances, which include
those to high-income countries, contracted by 1.7% to USD 581.6 billion
in 2015, from USD 592 billion in 2014. Slower growth may reflect the
impact of falling oil prices on remittances from GCC countries. Also,
deprecation of major sending country currencies (for example, the Euro,
the Canadian and Australian Dollar) vis-a-vis the US Dollar played a
role.
"Remittances to India, the (South Asian) region''s largest economy and
the world''s largest remittance recipient, decreased by 2.1% in 2015, to
USD 68.9 billion. This marks the first decline in remittances since
2009," the World Bank report said. Your Company has degrown its inward
remittance business by 8% over last year.
Your Company''s own Multi Currency Prepaid Travel Card (Borderless
Prepaid Card), launched in 2012 in association with MasterCard and
Access Prepaid Worldwide, continued to grow at high double digit year
on year growth rate. The Borderless Prepaid Card was loaded with US$
288 Million for the period 1st March, 2015 till 31st March, 2016 with
an average monthly load of US$ 23 Million. Over 200,000 cards have been
sold since the launch of the product in 2012 with a total load volume
of US$ 816 Million. To keep pace with the changing needs of the
customers and to ensure seamless delivery, your Company invested in new
technology in financial year 2015-16, ensuring better response times,
improved management reporting and reduction of effort for the
employees. Your Company will continue to enhance its technological
backbone with the objective of customer service and delivery.
Volatility in exchange rate, increasingly stringent compliance
requirements, increasing competitive intensity, risk of obsolescence
and adverse economic conditions are some key external factors that
could impact the business adversely. Also, upward revision of rental
costs of foreign exchange outlets at certain airports resulted in an
overall reduction in margins in the retail foreign exchange business.
However, your Company grew the Profit Before Taxation of the foreign
exchange business by 56% over last year by implementing a series of
growth initiatives, as mentioned above, efficiently managing the cost
of operations of the foreign exchange segment and optimising the
working capital cycle.
Despite various challenges faced by the Travel and Tourism industry for
most part of the year, your Company had a decent growth of its
business. Your Company created platform for user-friendly customer
experience for any foreign exchange transactions online. The
commencement of Thomas Cook India''s ''Buy Forex Online'' services has
empowered travellers to buy their foreign exchange and Forex related
products like the Thomas Cook Borderless Multicurrency Prepaid Card in
a safe environment, at the click of a button and also the added
convenience of home delivery via our portal www.thomascook.in.
Launch of ''Online Visas'' the first visa application online platform in
India, empowering customers with detailed visa information including
visa requirements per destination, downloadable visa forms, consular
addresses and timings, processing duration, and visa costs. Online
transactions, acquisitions and partnerships are creating opportunities
for growth and innovation in this sector. Among the current verticals
of Indian e-commerce, online travel segment still holds the biggest pie
with 61% market share. The travellers are ready to pay more for a
personalized and complete holiday package. Since mobile apps are
helping customers connect with the portal seamlessly and are becoming a
major differentiating factor when selecting a travel company,
E-Business successfully launched Forex and Holiday mobile applications
to meet the changing needs of customers.
There is a special focus on this segment as social media is now
considered the best way to reach out to the public. Your Company is
also trying to build a simpler design for the website and mobile
applications, as this will allow the website and apps to load faster
without compromising on the design or the user experience. Your Company
has been continuously looking at innovative ways of engaging with
people through their personal devices. Mobile has already become the
preferred choice of the customers to access the online travel services.
The narrowing of the trade deficit, due to positive export growth and
contraction in both oil and non-oil imports, should bring the current
account deficit down to a more sustainable level for the fiscal year as
a whole. The depreciated rupee made India an attractive tourist
destination but inbound tourism did not grow as expected due to
sluggish economic climate in source markets in 2015. The Indian
government has realised the country''s potential in the tourism industry
and has taken several steps to make India a global tourism hub. With
domestic carriers continuing to enhance their fleet strength and adding
on capacity, the Average Ticket Prices continue to show a downward
slide.
Your Company is seeing an increasing trend of corporate customers
seeking to utilize the Online Booking Tool, rather than providing their
booking requests offline through other means.
Despite intense competition amongst large and small players in the
sector, your Company''s MICE business has registered significant top
line growth by cementing strong relationships with several corporate
houses, tapping new markets and clients.
Your Company''s E-Business segment continued to be a strong focus area
as a part of comprehensive multi channel strategy. The call centre has
seen a phenomenal growth in enquiries & bookings over the last year.
India has tremendous potential to promote Domestic Tourism and will
witness a substantial increase in the years to come. In the domestic
tourism segment, Religious tourism comes in second, followed by leisure
tourism. Depreciation of the rupee has also made domestic travel more
affordable than holidaying overseas, especially for travellers having a
fixed budget.
With around 2 million transactions for the year in 2015, it observed a
growth of 30% in direct business through direct corporates and walkin
applicants and is growing leaps and bounds capturing and setting a
strong foot in the Visa business. Apart from catering to the Travel
Businesses of your Company and adding direct external customers for
their visa, passport it also serves ancillary transactions
[Attestations, Legalization, Apostille, Translation, Notarization of
documents, Foreigners Regional Registration Office (FRRO) registration/
visa extension/ exit permit, procures People of Indian Origin (PIO) /
Overseas Citizen of India (OCI) cards].
Your Company continues its focus on Travel Insurance with the strategy
of being a complete travel solutions provider and ensure that the
customer is advised and educated about the benefits of travel
insurance. Your Company offers both overseas as well as domestic travel
insurance. Your Company conducts regular training programs and deeper
interactions with all the other lines of businesses like Leisure
Travel, Foreign Exchange, MICE, Corporate Travel, Visa, etc. to offer
the products to their specific set of customers. This has helped in
improving the penetration of insurance in every business, garnering
higher share of customer wallet and building customer loyalty. With
technology being the main driver, your Company continuously works
towards making the process seamless and easy for its customers.
Your Company will continue to strengthen its digital presence with the
launch of the Mobile Apps and have allocated more than a sizable
portion of the advertising budget solely for digital media/ platforms.
This year also marked the launch of two of the most innovative products
targeting 2 different segments: Holiday Savings Account for the much
celebrated (and rapidly growing) Indian middle-class and Travel Quest
for the highly lucrative student / study tour business.
Quess Corp Limited (Quess) (formerly known as IKYA Human Capital
Solutions Limited), a subsidiary of your Company, reported a decent
growth in its operations and revenues. Quess initiated the process for
its Initial Public Offer (IPO) to raise upto Rs 4000 million, net
proceeds from which is proposed to be used for funding incremental
working capital requirements, repayment of debt, funding of
acquisitions and strategic initiatives, and other capital expenditures.
After seeking necessary approvals from Shareholders and applicable
regulatory, the Company along with its subsidiary, Travel Corporation
(India) Limited completed the acquisition of SOTC Travel Services
Private Limited (formerly known as Kuoni Travel (India) Private
Limited) on December 16, 2015 and Kuoni Travel (China) Limited on
November 9, 2015 for a sum consideration of Rs.5,350 million.
Post acquisition, Kuoni was rebranded to SOTC in early 2016. SOTC is a
leading travel and tourism company active across various travel
segments including Leisure Travel, Business Travel, Destination
Management Services and Distribution Visa Marketing Services.
Your Company, through its step down subsidiary, Horizon Travel Holdings
(Hong Kong) Private Limited [now rechristened as Luxe Asia Travel
(China) Limited] holds 100% stake in Kuoni Travel (China) Limited
(Kuoni Hong Kong), which has an attractive business in the travel
sector backed by a trusted brand name, and a stable and motivated
professional management team. Kuoni Hong Kong is a premium outbound
travel operator in Hong Kong.
Operations in Sri Lanka
Thomas Cook Lanka (Private) Limited, operates in foreign exchange
business which includes buying and selling of foreign currencies in Sri
Lanka at 4 locations i.e. International airport (Arrival and Departure)
in Katunayaka, Crescate outlet in Colombo and one in Kandy (Kandy city
centre). At the international airport, there are 3 counters at arrival
where encashment business is undertaken and 1 counter at the departure
area where the sale business is undertaken.
During the year, your Company, through its wholly owned subsidiary
Thomas Cook Lanka (Private) Limited in Sri Lanka, acquired Luxe Asia
Private Limited (Luxe Asia) on 30th July, 2015. Based in Sri Lanka,
Luxe Asia is focussed primarily on inbound tourism from key global
markets and services both tour operator and traveller segments across
its ten destinations in the Indian Ocean Region and Asia.
Thomas Cook Lanka (Private) Limited serves as an investment vehicle for
any proposed future investments into Sri Lanka subject to requisite
regulatory approvals.
Operations in Mauritius
The impact of recession in Eurozone stagnated and the Mauritius
operations saw a turnaround together with efficient management of costs
exercise undertaken by the company. The tourist inflow has increased
and the Asian market is keen on exploring Mauritius. Economic and
business scenario look optimistic and with the impact of cost inflation
remaining under control, the projections are expected to be above
average. Mauritius operations are exploring new initiatives to open a
new air corridor and are in touch with the other sister concerns to
increase the market share. Forex transactions are also expected to rise
in the coming period and new business partners have been identified.
The company has been reviewing the associated risk within the business
segments and adequate actions are being initiated to handle these
situations including investment on improving IT infrastructure.
PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND
FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
Your Company being in the Travel and Tourism industry, its activities
do not involve any expenditure on Technology and Research and
Development therefore, the particulars in the Companies (Accounts)
Rules, 2014, as amended, are not required to be submitted.
During the financial year, the foreign exchange earnings (on a
standalone basis) amounted to Rs.705.90 million, whereas, the Company
has incurred Rs.133.71 million as expenditure in foreign currencies
towards interest, bank charges, license fees, professional fees,
travelling, subscriptions etc., as disclosed in Note 33 in the Notes to
the financial statements.
On a Consolidated basis, the foreign exchange earnings amounted to
Rs.4260.04 million, whereas, the Company has incurred Rs.871.87 million
as expenditure in foreign currencies towards interest, bank charges,
license fees, professional fees, travelling, subscriptions etc.
DEPOSITS
During the financial year, the Company has not accepted any deposit
within the meaning of Section 73 & 76 of Companies Act, 2013, read with
the Rules made thereunder.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the financial year, all the transactions with related parties
are in the ordinary course of business and on arm''s length basis; and
there are no material contracts or arrangements or transactions at
arm''s length basis or otherwise and thus disclosure in Form AOC-2 is
not required.
DETAILS OF FRAUDS REPORTED BY AUDITORS
There were no frauds reported by the Statutory Auditors under
provisions of Section 143(12) of the Companies Act, 2013 and rules made
thereunder.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR
COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS OF
THE COMPANY
There were no significant and material orders passed by the regulators
or courts or tribunals impacting the going concern status of the
Company.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The Particulars of Loans, Guarantees and Investment forms part of the
notes to the financial statements provided in this Annual Report.
ISSUANCE OF NON CONVERTIBLE DEBENTURES
During the financial year, the Company after seeking necessary approval
of shareholders and other applicable regulatory authorities, issued
unsecured, rated, listed 1000 Non Convertible Debentures (NCD) of
Rs.1,000,000/- (Rupees Ten Lakhs only) each on private placement basis
aggregating to Rs.1,000 million. The proceeds of NCD were used for
financing the Company''s working capital requirements.
Credit rating
In respect of Rs.2,000 million Non Convertible Debenture of the
Company, ICRA Ratings have, during the year upgraded as under:
Particulars Amount Rating Remarks
(Rs. Millon)
Non 2000.00 ICRA AA/stable Revised from [ICRA]
Convertible (ICRA double A/ AA- /stable (ICRA
Debentures stable) double A minus/
stable)
Total 2000.00
Issuance non convertible cumulative redeemable preference
SHARES (NCCRPS)
During the financial year, the Company after seeking necessary approval
of shareholders and other regulatory authorities, issued and alloted
125000000 NCCRPS of Rs.10/- (Rupees Ten only) each on private placement
basis aggregating to Rs.1250 million. The proceeds of NCCRPS were used
for meeting the part of the funding requirements arising out of the
acquisition of Indian operations of SOTC Travel Services (India)
Limited (formerly known as Kuoni Travel (India) Private Limited).
directors'' responsibility statement
Pursuant to Section 134(3) of the Companies Act, 2013, with respect to
Directors'' Responsibility Statement, it is hereby confirmed that:
i) in the preparation of the annual accounts for the year ended 31st
March, 2016, the applicable accounting standards have been followed and
there are no material departures;
ii) the Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company as on 31st March, 2016 and of the profit of the Company
for the period ended on that date;
iii) the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of Companies Act, 2013 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
iv) the Directors have prepared the annual accounts on a going concern
basis;
v) the Directors have laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and are operating effectively; and
vi) the Directors have devised proper system to ensure compliance with
the provisions of all applicable laws and that such systems are
adequate and operating effectively.
directors
Appointments and Re-Appointments
In accordance with provisions of Section 152 of the Companies Act, 2013
and Article 116 of the Articles of Association of the Company, Mr.
Chandran Ratnaswami (DIN: 00109215), Non Executive Director retires by
rotation and being eligible, offers himself for re- appointment to the
Board.
Mr. Sunil Mathur (DIN: 00013239) and Mr. Nilesh Vikamsey (DIN:
00031213) were appointed as Additional Non Executive Independent
Directors by the Board of Directors of the Company at its meeting held
on 23rd December, 2015. As Additional Directors, they hold office upto
the date of the ensuing Annual General Meeting of the Company. The
Company has received notices in writing under Section 160 of the
Companies Act, 2013 from members proposing Mr. Mathur''s and Mr.
Vikamsey''s candidature for the office of a Director. Accordingly, Mr.
Mathur and Mr. Vikamsey are proposed to be appointed as Non Executive
Independent Directors at the ensuing Annual General Meeting.
Profiles of the Directors, as required under Regulation 36 of
Securities & Exchange Board of India SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 and Secretarial Standard - 2
are given in the Corporate Governance Report which forms part of this
Annual Report.
The above proposal for appointments and re-appointment form part of the
Notice of the Thirty-Ninth Annual General Meeting and the relevant
Resolutions are recommended for your approval therein.
Resignations
Mr. Uday Chander Khanna (DIN: 00079129), Non Executive Independent
Director and Mr. Mahendra Kumar Sharma (DIN: 00327684), Chairman and
Non Executive Independent Director resigned from the Board w.e.f. 1st
September, 2015 and 31st December, 2015 respectively due to their
preoccupations. The Board expressed its appreciation to outgoing
Directors for their valuable inputs, insights and guidance to the
Company during their tenure.
chairman and Managing Director
Mr. Madhavan Menon (DIN: 00008542), Managing Director of the Company
was re-designated as Chairman and Managing Director of the Company
w.e.f. 1st January, 2016.
Declaration of Independence
The Company has received necessary declarations from Independent
Directors of the Company confirming that they meet the criteria of
Independence as prescribed both under Section 149(6) of the Companies
Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015.
Board Evaluation
Pursuant to provisions of the Companies Act, 2013 and SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015, the Board
has carried out an annual evaluation of the Board as a whole, various
Committees, Directors individually and the Chairman.
The statement including the manner in which the evaluation exercise was
conducted is included in the Corporate Governance Report, which forms
part of this Annual Report.
number of board Meetings during the financial year
During the financial year, 12 meetings of the Board of Directors were
held, the details of which are given in the Corporate Governance Report
of the Company, which forms a part of this Report.
key managerial personnel
Mr. Rambhau R. Kenkare was the President and Head - Legal and Company
Secretary of the Company upto 8th March, 2016 and after his
re-designation as President & Group Head - Legal, Secretarial &
Administration, Mr. Amit J. Parekh, was appointed as the Company
Secretary & Compliance Officer w.e.f. 8th March, 2016 in his place.
auditors
Statutory Auditors
M/s. Lovelock & Lewes, Chartered Accountants, Firm Registration
No.301056E, Auditors of the Company who retire at the ensuing Annual
General Meeting are eligible for re-appointment and have expressed
their willingness to accept office, if re-appointed. They have given a
certificate to the effect that the re-appointment, if made, would be
within the provisions of Section 139 & 141 of the Companies Act, 2013
and the Companies (Audit & Auditors) Rules, 2014, as amended. Your
Directors recommend their re-appointment from the conclusion of the
ensuing Annual General Meeting upto the conclusion of the next Annual
General Meeting. The Statutory Auditors Report does not contain any
qualifications, reservations or adverse remarks on the financial
statements of the Company. Further, your Company also obtained
Statutory Auditors Report as per requirement of circulars issued by
Reserve Bank of India from time to time in relation to downstream
investments.
Secretarial Auditor
The Board of Directors have appointed Mr. Keyul M. Dedhia of M/s Keyul
M. Dedhia & Associates, Company Secretaries in Practice as the
Secretarial Auditor of the Company under the provisions of Section 204
of Companies Act, 2013, for conducting the Secretarial Audit for the
financial year 2015-16. The Secretarial Audit Report for the financial
year 2015-16 does not contain any adverse remark, qualification or
reservation or declaimer which requires any explanation/comments by the
Board. The Secretarial Audit Report is annexed as Annexure 1 which
forms the part of this Report.
corporate social responsibility
Corporate Social Responsibility (''CSR'') Committee:
In compliance with the requirements of Section 135 of the Companies
Act, 2013 read with the Companies (Corporate Social Responsibility)
Rules, 2014, as amended, the Board of Directors have constituted a CSR
Committee. The details of the Committee are provided in the Corporate
Governance Report, which forms part of this Annual Report.
CSR Policy:
The contents of the CSR Policy of the Company as approved by the Board
on the recommendation of the CSR Committee is available on the website
of the Company and can be accessed through the web
link:http://www.thomascook.in/pages/indus/tcportal/Speeches_
Presentations.html.
CSR initiatives undertaken during the financial year 2015-16:
During the financial year 2015-16, the Company has spent Rs.5,935,180/-
million on CSR activities.
The Annual Report on CSR Activities undertaken by Company during the
financial year 2015-16, is annexed as Annexure 2 which forms part of
this Report.
incorporations/ acquisitions
The financial year 2015-16 was an eventful year with many events taking
place such as incorporations, acquisitions, mergers, omposite Scheme of
Amalgamations and Arrangements.
Borderless Travel Services Limited and Jardin Travel Solutions Limited
During the financial year, your Company has incorporated two wholly
owned subsidiary Companies with the name & style Borderless Travel
Services Limited and Jardin Travel Solutions Limited on 25th August,
2015 and 1st September, 2015, respectively.
Sterling Holiday Resorts (india) Limited
The Board of Directors of the Company, Thomas Cook Insurance Services
(India) Limited ("TCISIL") & Sterling Holiday Resorts (India) Limited
("SHRIL") have at their meetings held on 7th February, 2014 approved a
composite scheme of arrangement and amalgamation ("Scheme") pursuant to
which there was:
(i) a demerger of the resort and timeshare business from SHRIL to
TCISIL; and (ii) amalgamation of residual SHRIL into the Company.
Pursuant to the scheme, (i) 116 equity shares of the Company were
issued to the shareholders of SHRIL for every 100 equity shares held in
SHRIL in consideration of the demerger of the resort and timeshare
business of SHRIL from SHRIL to TCISIL; and (ii) 4 equity shares of the
Company were issued to the shareholders of SHRIL for every 100 equity
shares held in SHRIL in consideration of the amalgamation of residual
SHRIL into the Company.
Pursuant to approval of Hon''ble High Court of Madras vide its Order
dated 13th April, 2015 and the approval of Hon''ble High Court of Bombay
vide its Order dated 2nd July, 2015, the above Scheme was implemented
by allotting 4,86,57,929 equity shares of Rs.1/- each of the Company to
the shareholders of SHRIL on 3rd September, 2015.
Pursuant to the requirement of the Scheme, there were 1855 fractional
shares which were sold in the open market. The sale of shares generated
net amount of Rs.366,514/- (after deduction of applicable charges,
brokerage and taxes) which were distributed to the eligible
shareholders as per their respective entitlements.
kuoni Travel (india) Private Limited & kuoni Travel (China) Limited
After seeking necessary approvals from Shareholders and other
applicable regulatory authorities, the Company along with its
subsidiary, Travel Corporation (India) Limited completed the
acquisition of SOTC Travel Services Private Limited (formerly known as
Kuoni Travel (India) Private Limited) on 16th December, 2015 and Kuoni
Travel (China) Limited on 9th November, 2015 for a sum consideration of
Rs.5,350 million.
Other Downstream Acquisition/Merger
i) The Hon''ble High Court of Karnataka sanctioned the Scheme of
Arrangement between Quess Corp Limited (formerly known as IKYA Human
Capital Solutions Limited) and its wholly owned subsidiaries - Magna
IKYA Infotech Inc., Avon Facility Management Services Limited and
Hofincons Infotech & Industrial Services Private Limited.
ii) Acquisition of Nature Trails Resorts Private Limited by Sterling
Holiday Resorts Limited (formerly known as Thomas Cook Insurance
Services (India) Limited)
iii) Acquisition of Luxe Asia Private Limited by Thomas Cook Lanka
(Private) Limited
iv) Acquisitions of MFXchange Holding Inc., Randstad Lanka Private
Limited, and Aravon Service Private Limited (formerly known as Aramark
India Private Limited) by Quess Corp Limited
v) Board of Directors of the Company accorded its in-principle approval
for the merger of SITA Travel Services Limited, the inbound division of
SOTC Travel Services Private Limited (formerly known as Kuoni Travel
(India) Private Limited) with Travel Corporation (India) Limited
subject to necessary approvals.
committees of board
The Board of Directors have formed the following committees and the
detail pertaining to such committees are included in the Corporate
Governance Report, which forms part of this Annual Report.
- Audit Committee
- Nomination and Remuneration Committee
- Stakeholder Relationship Committee
- Corporate Social Responsibility Committee
- Sub-Committee of the Board
listing of securities
The Company has its following Securities listed on the Stock Exchanges
viz. BSE Limited and National Stock Exchange of India Limited:
- Equity Shares
- Non Convertible Cumulative Redeemable Preference Shares (''NCCRPS'')
- Non Convertible Debentures (''NCD'')
The Company has paid the Annual Listing Fees for all the securities to
Stock Exchanges.
CORPORATE GOVERNANCE AND MANAGEMENT DiSCUSSiON AND analysis REPORT
Your Company continues to be committed to good corporate governance
aligned with the best corporate practices. It has also complied with
various standards set out by Securities and Exchange Board of India and
the Stock Exchanges where it is listed. The Management Discussion and
Analysis Report for the financial year 2015-16, as stipulated under
SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015 is given separately which forms part of this Annual Report.
For the financial year ended 31st March, 2016, your Company has
complied with the requirements of Clause 49 of the erstwhile Listing
Agreement, to the extent applicable, SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 and other applicable rules
and regulations with respect to Corporate Governance.
A certificate from a Practising Company Secretary was obtained by the
Company regarding such compliance of conditions of Corporate Governance
is annexed to the Corporate Governance Report which forms part of this
Annual Report.
nomination & remuneration policy
For the purpose of selection of any Director, Key Managerial Personnel
and Senior Management Employees, the Nomination & Remuneration
Committee identifies persons of integrity who possess relevant
expertise, experience and leadership qualities required for the
position. The Committee also ensures that the incumbent fulfils such
other criteria with regard to age and other qualifications as laid down
under the Companies Act, 2013 or other applicable laws. The Board has,
on the recommendation of the Nomination & Remuneration Committee framed
a policy for selection, appointment and remuneration of Directors, Key
Managerial Personnel & Senior Management. The Nomination & Remuneration
Policy of the Company and Performance Criteriea is annexed herewith as
Annexure 3 to this Report.
viGIL MECHANISM
The Company has established a vigil mechanism for Directors and
employees by adopting a Whistle Blower Policy which is available at the
website of the Company and weblink thereto is http://www.
thomascook.in/pages/indus/tcportal/Speeches_Presentations.html.
MATERIAL Changes AND CoMMITMENTS
There are no material changes and commitments affecting the financial
position of the Company which have occurred between the end of the
financial year and the date of the Report.
RISK MANAGEMENT
The Company has adopted a Risk Management Policy which lays down the
framework to define, assess, monitor and mitigate the business,
operational, financial and other risks associated with the business of
the Company.
extract of annual return
Pursuant to the Provisions of Section 92(3) of the Companies Act, 2013
read with Rule 12(1) of the Companies (Management and Administration)
Rules, 2014, as amended, extract of the Annual Return of the Company in
the prescribed Form MGT-9 is annexed as Annexure 4 to the Report.
COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES, JOINT
VENTURES OR ASSOCIATE COMPANIES DURING THE FINANCIAL YEAR
During the financial year following Companies have become subsidiaries
of the Company:
During the financial year, Magna IKYA Infotech Inc., Avon Facility
Management Services Limited and Hofincons Infotech & Industrial
Services Private Limited, step down subsidiary companies of the Company
were amalgamated with Quess Corp Limited (formerly known as IKYA Human
Capital Solutions Limited)
During the financial year, there were no joint venture or associate
companies.
Alteration of memorandum of association of company
During the financial year, after seeking approval of shareholders vide
Extraordinary General Meeting of the Company held on 27th November,
2015 the Company has altered its Memorandum of Association of Company.
Awards and accolades
Thomas Cook (India) Limited has been the recipient of the following
highly prestigious awards and accolades during the F.Y. 2015-16:
1) Best Tour Operator Outbound at CNBC AWAAZ Travel Awards 2015
2) Best Company providing Foreign Exchange at CNBC AWAAZ Travel Awards
2015
3) Thomas Cook India''s Travel Quest honoured with a Gold Award at PATA
Gold Awards 2015
4) Favourite Tour Operator at the Conde Nast Traveller Readers'' Travel
Awards 2015
5) Diamond Award for Exemplary Achievements in Visa Issuance at the
French Ambassador''s Travel Awards Ceremony 2015
6) Thomas Cook Centre of Learning honoured with IATA accreditation for
Top 10 performing South Asia IATA Authorized Training Centers 2016
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION,
PROHIBITION & REDRESSAL) ACT, 2013
Thomas Cook (India) Limited has Zero tolerance towards any action on
the part of any executive which may fall under the ambit of ''Sexual
Harassment'' at workplace, and is fully committed to uphold and maintain
the dignity of every women executive working in the Company. The
Company''s Policy provides for protection against sexual harassment of
woman at workplace and for prevention and redressal of such complaints.
Number of complaints pending as on the beginning of the financial year
Nil
Number of complaints filed during the financial year 6
Number of complaints pending as on the end of the financial year Nil
INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUACY
The details on Internal Financial Control System and their adequacy are
provided in the Management Discussion and Analysis Report which forms
part of this Annual Report.
PARTICULARS OF EMPLOYEES
Disclosure with respect to the remuneration of Directors and employees
as required under Section 197(12) of the Companies Act, 2013 read with
Rule 5(1) of Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, is annexed as Annexure 5 to the Report.
Statement containing Particulars of Employees pursuant to Section
197(12) of the Companies Act, 2013 read with Rule 5(2) and Rule 5(3) of
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014 forms part of this Annual Report. As per the provisions of Section
136 of the Companies Act, 2013, the reports and accounts are being sent
to shareholders of the Company and other entitled thereto, excluding
the Statement containing Particulars of Employees. Any shareholder
interested in obtaining such details may write to the Company Secretary
at the Registered Office of the Company.
EMPLOYEES STOCK OPTION PLANS (ESOPS)
With the objective of motivating and retaining key talent in the
organisation and fostering ownership, your Company has framed the
Thomas Cook Employees Stock Option Plan 2007 (ESOP 2007) and Thomas
Cook Employees Stock Option Plan (ESOP 2013) and pursuant to the same,
has granted stock options to its employees over the years.
The Company also framed the Thomas Cook Save As You Earn Scheme 2010
(SAYE Scheme 2010) with similar objectives. SAYE Scheme 2010 allowed
employees to save a part of their net pay every month which gets
deposited with a bank in a recurring deposit account carrying fixed
rate of interest.
During the financial year, 1732500 options were approved for grant
under the ESOP 2007. However, there were no options approved for grant
under SAYE Scheme 2010 and ESOP 2013.
Pursuant of the Composite Scheme of Arrangement and Amalgamation
between Sterling Holiday Resorts (India) Limited ("SHRIL"), Thomas Cook
Insurance Services (India) Limited ("TCISIL") and Thomas Cook (India)
Limited (the "Company" or "TCIL") approved by the Hon''ble High Courts
of Madras and Bombay, 430326 employee stock options of TCIL were issued
in lieu of outstanding employee stock options under SHRIL Employee
Stock Option Scheme, 2012.
The Nomination & Remuneration Committee administers and monitors the
Schemes. Disclosure on various Schemes, as required under SEBI (Share
Based Employee Benefits) Regulations, 2014 read with SEBI circular no.
CIR/CFD/POLICY CELL/2/2015 dated 16th June, 2015 are available on the
Company''s website at
http://www.thomascook.in/pages/indus/tcportal/Financials.html.
No employee has received options equal to or exceeding 1% of the issued
capital of the Company at the time of grant during the financial year.
SUBSIDIARY COMPANIES
In accordance with Section 129(3) of the Companies Act, 2013, the
Company has prepared a consolidated financial statement of the Company
and all its subsidiary companies, which is forming part of the Annual
Report. A statement containing salient features of the financial
statements of the subsidiary companies in format prescribed under Form
AOC-1 is also included in the Annual Report.
In accordance with third proviso of Section 136(1) of the Companies
Act, 2013, the Annual Report of the Company, containing therein its
standalone and the consolidated financial statements has been placed on
the website of the Company, www.thomascook.in. Further, as per fourth
proviso of the said section, audited annual financial statements of
each of the subsidiary companies have also been placed on the website
of the Company and the weblink thereto is http://
www.thomascook.in/pages/indus/tcportal/Annual_Reports.html.
Accordingly, the said documents are not being attached to the Annual
Report. Shareholders interested in obtaining a copy of the audited
financial statements of the subsidiary companies may write to the
Company Secretary at the Company''s registered office.
As stipulated in Section 129 of the Companies Act, 2013 and Regulation
4 of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015, the consolidated financial statements have been
prepared by the Company in accordance with the applicable Accounting
Standards.
DISCLOSURE REQUIREMENTS
The various policies and codes adopted by the Company are stated in
detail in the Corporate Governance Report of the Company, which forms
part of this Annual Report.
ACKNOWLEDGEMENT AND APPRECIATION
Your Directors thank all the Shareholders, Customers, Vendors for their
continued support throughout the year. Your Directors also thank the
Reserve Bank of India and other Banks, Ministry of Tourism, Financial
Institutions, Government of India, State Governments and other
Government agencies for the support extended by them and also look
forward to their continued support in future.
Your Directors also wish to place on record their appreciation of the
contribution made by the Company''s employees at all levels but for
whose hard work, solidarity and support, your Company''s consistent
growth would not have been possible.
For and on behalf of the Board
Madhavan Menon Harsha Raghavan
Chairman & Managing Director Non Executive Director
(DIN: 00008542) (DIN: 01761512)
Mumbai
Dated: 28th May, 2016
Mar 31, 2015
Dear Members:
The Directors have pleasure in presenting the Thirty - Eighth Annual
Report, together with audited financial statements for the fifteen
months period ended 31st March, 2015 (from 1st January, 2014 to 31st
March, 2015).
Financial performance
Rs. in Million except Earnings Per Share
Standalone
Particulars Fifteen months Year ended
Period ended 31st December
31st March, 2013**
2015#
Total Revenue 5,135.82 3,750.71
Profit before 486.21 702.94
Tax
Provision for 157.00 260.20
Taxation
MAT Credit - -
Entitlement
(Write back)/ Provision (2.90) (18.51)
for Deferred Taxation
Profit after Taxation 332.11 461.25
Profit after Taxation - -
and before Minority
Interest
Minority Interest - -
Profit after - -
Taxation and Minority
Interest
Transferred to 33.21 46.12
General Reserve
Dividend Proposed/ 138.61 105.77
Paid
Earnings Per Share - 1.31 1.96
Basic (per equity
share of Rs. 1/- each)
Earnings Per Share - 1.10 1.91
Diluted (per equity
share of Rs. 1/- each)
Rs. in Million except Earnings Per Share
Consolidated A
Particulars Fifteen months Year ended
Period ended 31st December
31st March, 2015# 2013**
Total Revenue 32,863.21 12,959.54
Profit before 1,709.88 1,022.60
Tax
Provision for 517.19 368.17
Taxation
MAT Credit 16.96 (16.38)
Entitlement
(Write back)/ Provision 52.35 (16.44)
for Deferred Taxation
Profit after Taxation - -
Profit after Taxation 1,123.38 687.25
and before Minority
Interest
Minority Interest 221.87 65.05
Profit after 901.51 622.20
Taxation and Minority
Interest
Transferred to 33.21 46.12
General Reserve
Dividend Proposed/ 138.61 105.77
Paid
Earnings Per Share - 3.56 2.64
Basic (per equity
share of Rs. 1/- each)
Earnings Per Share - 2.98 2.57
Diluted (per equity
share of Rs. 1/- each)
# The Company extended its financial year to bring it in line with the
requirements of the provisions of sub-section (41) of Section 2 of the
Companies Act, 2013. The current financial period is for the period of
fifteen months from 1st January, 2014 to 31st March, 2015 and therefore
not comparable with the previous year.
The subsequent financial years of the Company will commence from 1st
day of April every year and end on 31st March of the following year.
A Consolidated financial statements for the period ended 31st March,
2015 include the consolidated audited financial statements of Sterling
Holiday Resorts (India) Limited for the period 3rd September, 2014 to
31st March, 2015.
In the previous year, the consolidated financial statements for the
year ended 31st December, 2013 included the consolidated audited
financial statements of Quess Corp Limited (previously IKYA Human
Capital Solutions Limited) for the period 14th May, 2013 to 31st
December, 2013. Consequently, consolidated financial statements for the
period ended 31st March, 2015 are not comparable with previous year.
** Previous Year figures have been reclassified wherever necessary to
conform to this period's classification.
Operations & Results
The Travel and Tourism industry maintained its position as one of the
top industries of the country. While the sector faces challenges every
year and this year was no different from the past, it maintained a
modest growth rate. Overall business sentiment and economic outlook
remained optimistic on account of a stable government. The year saw
decent growth of your Company's portfolio of retail products, strong
leisure travel trends for both group and individual travel business and
the outreach program with channel partners. Your Company expanded its
reach by ensuring it has products right from Super Budget, Budget to
Premium and Royale category, thus reaching to a larger market segment
with wide choices. Your Company further strengthened its Inward
Remittance business both from a penetration perspective as well as from
a business growth perspective.
Your Company continued its focus on acquisition of new clients and
strived to provide un-paralleled customer service along with a suite of
products. Your Company continued to be the preferred choice for
customers on -the -go and expanded its abilities to serve consumers
through various new channels. To keep up with the pace and the changing
needs of the customers and to ensure seamless delivery, your Company
enhanced its technological backbone with the objective of customer
service and delivery.
Your Company increased its marketing efforts, specifically on the
digital marketing mediums, to reach out to its target customer base
effectively with the strategy of being a complete travel solution
provider. Given India's young demography and emergence as the youngest
workforce of the world - more and more customers have started buying
everything from mobile phones to services online.
Your Company recorded total revenue of Rs. 5,135.82 million and profit
before tax of Rs. 486.21 million with profit after tax being Rs. 332.11
million for the period ended 31st March 2015. The basic earnings per
share of the Company is Rs. 1.31 per Equity Share of Rs. 1/- each.
Thomas Cook Presence
As of 31st March, 2015, your Company, along with its subsidiaries,
continues to be amongst the largest integrated travel groups in India.
Your Company operates through 233 locations in 94 cities, 112 PSAs and
115 Gold Circle Partner outlets to have a wider spread and network
across the country.
Your Company also has presence in 13 countries outside India through
its branches/ representative offices in USA (New York), Spain
(Barcelona & Madrid), UK (London), Japan (Tokyo & Osaka), Germany
(Frankfurt), Nepal (Kathmandu), China (Beijing), South Korea (Seoul),
Russia (Moscow ), Argentina, Dubai, Canada and France apart from its
subsidiaries in Mauritius and Sri Lanka.
Share Capital Structure
The share capital structure as of 28th May, 2015 is as follows:
Authorised Capital: Rupees Rupees
Equity:
505827060 Equity 505,827,060
Shares of Rs. 1/-
each
Preference:
(i) 114760000 Class 'A' 4.65% 1,147,600,000
Cumulative Non-Convertible
Redeemable Preference Shares
of Rs. 10/- each
(ii) 355294 Class 'B' 0.001% 3,552,940
Cumulative Convertible /
Redeemable Preference Shares
of Rs. 10/- each
(iii) 302000 Class 'C' 0.001% 3,020,000
Cumulative Convertible /
Redeemable Preference Shares
of Rs. 10/- each
(iv) 125000000 Preference 1,250,000,000
Shares of Rs. 10/- each
2,910,000,000
Issued, Subscribed and
Paid-up Capital:
Equity:
272823330 Equity Shares 272,823,330
of Rs. 1/- each
Preference:
4423000 Compulsorily 44,230,000
Convertible Preference
Shares (CCPS) of Rs. 10/-
each
317,053,330
During the period, 319765 Class 'B' 0.001% Cumulative Convertible /
Redeemable Preference Shares of Rs. 10/- each and 271800 Class 'C'
0.001% Cumulative Convertible / Redeemable Preference Shares of Rs.
10/- each were converted on 25th April, 2014 into 5140000 equity shares
of Rs. 1/- each. The Board of Directors of the Company has on 9th
March, 2015 allotted 18270000 equity shares of Rs. 1/- each to
Fairbridge Capital Mauritius Limited, Promoter on conversion of 1827000
CCPS of Rs. 10/- each out of 6250000 CCPS.
Employees Stock Option Plans (ESOPs)
With the objective of motivating and retaining key talent in the
organisation and fostering ownership, your Company has framed the
Thomas Cook Employees Stock Option Plan 2007 and Thomas Cook Employees
Stock Option Plan (ESOP 2013) and pursuant to the same, has granted
stock options to its employees over the years.
The Company also framed the Thomas Cook Save As You Earn Scheme 2010
(SAYE Scheme 2010) with similar objectives. SAYE Scheme 2010 allowed
employees to save a part of their net pay every month which gets
deposited with a bank in a recurring deposit account carrying fixed
rate of interest.
During the period ended 31st March, 2015, 229906 options were approved
for grant under the ESOP 2013. However, there were no options approved
for grant under Thomas Cook Employees Stock Option Plan 2007 and SAYE
Scheme 2010.
The Nomination & Remuneration Committee administers and monitors the
schemes. The applicable disclosures under the Securities and Exchange
Board of India (Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999 (the Guidelines, as amended) are
mentioned in the Annexure to the Directors' Report.
During the period, certain senior managerial personnel and other
employees have received options exceeding 5% of the value of the
options granted, details of whom are annexed to this report. Further,
no employee has received options equal to or exceeding 1% of the issued
capital of the Company at the time of grant during the period.
Dividend
Your Directors recommend dividend for approval of the members as under:
1. On 319765 Class 'B' Preference Shares of Rs. 10/- each @ 0.001%
(i.e. Rs. 0.0001 per share) for the period 1st January, 2014 to 25th
April, 2014 (upto date of conversion);
2. On 271800 Class 'C' Preference Shares of Rs. 10/- each @ 0.001%
(i.e. Rs. 0.0001 per share) for the period 1st January, 2014 to 25th
April, 2014 (upto date of conversion);
3. On Compulsorily Convertible Preference Shares(CCPS):
@0.001% (i.e Rs. 0.0001 per share) on 1827000 CCPS of Rs. 10/- each for
the period 13th March, 2014 to 9th March, 2015 ( from date of allotment
upto date of conversion);
@0.001% (i.e Rs. 0.0001 per share) on 4423000 CCPS of Rs. 10/- each for
the period 13th March, 2014 to 31st March, 2015
4. On Equity Shares @ 50% (i.e. Rs. 0.50) on each equity share of Rs.
1/- for the period ended 31st March, 2015;
The proposed dividend on the equity capital and preference capital
absorbs Rs. 136.36 million for dividend and Rs. 28.53 million for
Dividend Tax. The Board seeks the approval of the shareholders to the
dividend recommended on the preference and equity share capital as will
be outstanding on the date of book closure/ record date.
General Reserve
Your Directors have resolved to transfer Rs. 33.21 million to General
Reserve out of the profits of the Company. With the transfer, the total
General Reserves stand at Rs. 353.64 million as at 31st March, 2015.
Further, as per requirement, your Directors have resolved to transfer
Rs. 81.60 million to Debenture Redemption Reserve.
Director's Responsibility Statement
Your Directors would like to assure the Members that the financial
statements for the year under review conform in their entirety to the
requirements of the Companies Act, 1956 pursuant to Section 217 (2AA)
and that:
1. in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
2. the Directors have selected such accounting policies and applied
them consistently except where otherwise stated in the notes to the
accounts and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the Profit of the
Company for that period;
3. the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities. The internal auditors have conducted periodic audits to
provide reasonable assurances that established policies and procedures
of the Company have been followed. However, it must be recognised that
there are inherent limitations in weighing the assurances provided by
any system on internal controls;
4. the Directors have prepared the annual accounts on a going concern
basis.
Promoters
Fairfax Financial Holdings Limited
The current promoters of your Company, Fairbridge Capital (Mauritius)
Limited ("FCML") holding 45.01% and H Investments Limited ("HIL")
holding 29.76% are 100% step down subsidiaries of Fairfax Financial
Holdings Limited ("Fairfax"), Canada.
Fairfax is a holding company which, through its subsidiaries, is
engaged in property and casualty insurance and reinsurance and
investment management. Fairfax was founded in 1985 by the present
Chairman and Chief Executive Officer, Mr. Prem Watsa. The company has
been under present management since 1985 and is headquartered in
Toronto, Canada. Its common shares are listed on the Toronto Stock
Exchange. Fairfax's corporate objective is to achieve a high rate of
return on invested capital and build long-term shareholder value.
Over the past 30 years, Fairfax has demonstrated a strong financial
track record to achieve an annual compounded appreciation in book
value per share of 21.1% and currently has over $35 billion in
consolidated assets.
Thomas Cook (India) Limited is a part of the Fairfax group. As of the
date hereof, the promoters hold 74.77% of the total paid up equity
share capital of the Company.
Thomas Cook (India) Limited
Operations in India [including subsidiaries]
During the period 2014-15 the Foreign Exchange volumes increased by
17%. Overall business sentiment and economic outlook towards India
remained optimistic. Despite various challenges faced by the industry
for most part of the year, your Company had a decent growth of its
business.
The year saw appreciable growth of your Company's portfolio of retail
products. The strong leisure travel trends for both group and
individual travel business and the outreach program with channel
partners helped grow the holiday foreign exchange business by 50%.
Getting a large country wise channel partner on board helped Student
business grow by 75%. 'Maintenance of close relatives' category of
outward remittance was another product which saw tremendous growth on
account of channel activation and awareness creation through marketing,
with volume growth of more than 57%. Corporates maintained caution
while spending on travel and foreign exchange.
Your Company's own Multi Currency Prepaid Travel Card (Borderless
Prepaid Card), launched in 2012, in association with MasterCard and
Access Prepaid Worldwide, continued to grow at high double digit year
on year growth rate. The Borderless Prepaid Card was loaded with US$
344 million for the period 1st January, 2014 till 31st March, 2015 with
an average monthly load of US$ 23 million. Over 125,000 cards have been
sold since the launch of the product in 2012 with a total load volume
of US$ 522 million.
This year, your Company became one of the only companies in India and
the first Non-Banking entity to have an Online Forex Store to offer a
simple and easy buying experience to customers for their Foreign
Exchange requirements. The online business volumes have increased by
296% over last year.
Your Company embarked on an ambitious plan for innovation and
Transformation across businesses, within businesses and across all
Channels with the launch of Holiday Saving Plan, Travel Quest and the
Gift Card.
Your Company continued its focus on Travel Insurance. With the strategy
of being a complete travel solution provider, the insurance arm of your
Company tries to understand the specific needs of the customers and
offers the best product which suit their requirements, which also helps
in garnering higher share of customer wallet and building customer
loyalty.
To reposition your Company as not just a leader in the offline "brick"
space - but a growing force in the online "click" space, your Company
began by designing and offering online products that were simple, all
inclusive, easy to buy and affordable.
Your Company revamped its website completely to make it more user
friendly and to offer it as India's only portal offering end to end
travel services across flights, hotels, visas, foreign exchange and
insurance and then started using thomascook.in in all its communication
- both online and offline to let customers know they could choose to
deal in whatever form they want.
Leisure Travel had witnessed a dip in passenger numbers in April - May
2014 (its otherwise peak season) on account of the parliamentary
elections in India. However in the following quarters your Company
witnessed increase in passengers through extended season. Your Company
further leveraged upon the extended season to grow sales through
tactical road shows & corporate carnivals.
Inbound Tourism grew by 10.6% in 2014 as against growth of 6% in 2013 &
4% in 2012. Foreign exchange earnings in rupee terms registered a
growth of 12% in 2014 over 2013 as against growth of 14% in 2013 over
2012 and 22% in 2012 over 2011.
Year 2014 witnessed a revival in air traffic demand. Domestic air
travel grew by 9.7% compared to 2013, driven by a series of discounted
promotions mounted by domestic carriers. After the slowdown in 2013,
Indian corporates gradually started increasing their business travel.
Various automation initiates were undertaken alongwith our GDS Partner,
Amadeus, to help improve upon service quality and staff productivity.
MICE offers a potential for high revenue earning with limited resource.
This year the MICE business saw an upswing trend and did take advantage
of the currency stabilizing. Further, new visa issuance policies
offered great opportunities to open up markets in some locations but
stringent policies in other destinations were a source of challenge.
Although having faced intense competition amongst large and small
players in the sector, MICE registered a top line growth by 15% by
cementing strong relationships with several respected corporate houses,
tapping new markets and serving new clients and focus on domestic
business.
E-Business continues to be a strong focus area as a part of
comprehensive multi channel strategy. The call centre has seen a
phenomenal growth in enquiries & bookings over last year.
Domestic traveller is increasingly looking at experiential travel in
India and your Company's Domestic product teams have created unique
itineraries including experiences like undersea walk in the Andamans,
malabar cuisine classes in Wayanad, elephant safari at Amber Fort in
Jaipur, tiger safaris in Corbett, Kalairipaytu at Munnar and Ayurvedic
spa therapy in the Nilgiris on the basis of the demand received for
such experiences for 2014.
TC Visa Services (India) Limited has exhibited both qualitative and
quantitative growth running in the third year of its operations, post
its incorporation as an entity under TCI umbrella.
Operations in Mauritius
The recession in Eurozone continues to have an impact on the tourist
inflow into the country and further stretched the reduced spending
pattern of foreign travelers, impacting the retail part of the
business. The country has also been marked by an uncertain economic and
political climate during most part of 2014 because of the imminence of
the general elections, which finally took place in December 2014. This
resulted into a very prudent and reserved behavior of the local
business community for most of the year, thus affecting foreign
exchange transaction volumes. The weak market conditions exacerbated
the competitive environment, thus putting additional pressure on the
margins.
Mauritius operations consist of 15 branches across the island. The
company has adopted a systematic approach to training on the area of
concern to improve the productivity of staff. The company has embarked
on a branch restructuring program for loss making branches for 2014-15.
Operations in Sri Lanka
Thomas Cook Lanka (Private) Limited has outlets both at the Arrival and
Departure terminals at the Bandaranaike International Airport. With
political stability continuing in Sri Lanka, Thomas Cook Lanka
(Private) Limited intends to further expand its operations in Negombo,
Colombo & Kandy.
Thomas Cook Lanka (Private) Limited serves as an investment vehicle for
any proposed future investments into Sri Lanka subject to requisite
regulatory approvals.
Awards and Accolades
Thomas Cook (India) Limited has been the recipient of the following
highly prestigious awards and accolades during the period 1st January,
2014 to 31st March, 2015:
* Voted as Favourite Outbound Tour Operator at the Outlook Traveller
Awards 2015
* IATA accreditation as "Top 10 South Asia IATA Authorized Training
Centers 2015
* Best Tour Operator - Outbound at the CNBC AWAAZ Travel Awards 2014 &
2013 and Best Company providing Foreign Exchange at the CNBC AWAAZ
Travel Awards 2014
* 'India's Leading Tour Operator' for the year 2014, at the 21st Annual
World Travel Awards Asia & Australasia 2014
* Favourite Tour Operator at the Conde Nast Traveller Readers' Travel
Awards 2014
* Consumer Superbrand 2013-14
Directors
In accordance with Article 116 of the Articles of Association of the
Company, Mr. Harsha Raghavan (DIN:01761512) retires by rotation and
being eligible, offers himself for re-appointment to the Board.
Mr. Pravir Kumar Vohra (DIN: 00082545) was appointed as a Non-Executive
Director (Independent) by the Board of Directors of the Company at its
meeting held on 10th April, 2015. As Additional Director, he holds
office upto the date of the ensuing Annual General Meeting of the
Company. The Company has received a notice in writing under Section
160 of the Companies Act, 2013 from a member proposing Mr. Vohra's
candidature for the office of Director. Accordingly, Mr. Vohra is being
proposed to be appointed as a Non-Executive Director (Independent).
In pursuance of the requirements of the Companies Act, 2013, all the
existing Independent Directors of the Company, Mr. Mahendra Kumar
Sharma (DIN: 00327684), Mr. Uday Chander Khanna (DIN: 00079129) and
Mrs. Kishori Udeshi (DIN: 01344073) were appointed as Independent
Directors of the Company, not liable to retire by rotation, to hold
office for a period of five consecutive years from 16th September, 2014
or till such earlier date to conform with the policy on retirement and
as may be determined by the Board of Directors of the Company and/ or
by any applicable statutes, rules, regulations or guidelines.
The Company has received necessary declarations from all Independent
Directors of the Company confirming that they meet the criteria of
Independence as prescribed both under Section 149(6) of the Companies
Act, 2013 and Clause 49 of the listing agreement with Stock Exchanges.
Mr. Madhavan Menon, Managing Director (DIN: 00008542) of the Company,
whose tenure as Managing Director expired on 28th February, 2015, was
re-appointed by the Board of Directors of the Company for a further
period of 5 years w.e.f. 1st March, 2015 to 28th February, 2020,
subject to approval of shareholders at the ensuing Annual General
Meeting of the Company and the approval of applicable statutory
authorities. The Board recommends his re-appointment as Managing
Director of the Company for a further period of 5 years w.e.f. 1st
March, 2015.
Mr. Ramesh Savoor (DIN:00149089) and Mr. Krishnan Ramachandran
(DIN:00193357) resigned from the Board with effect from 1st August,
2014 and 5th August, 2014 respectively. The Board expresses its
appreciation to them for their invaluable guidance during their tenure
as Directors of the Company.
The above appointments and re-appointments form part of the Notice of
the Thirty-eighth Annual General Meeting and the relevant Resolutions
are recommended for your approval therein.
Profiles of the Directors, as required by the Listing Agreement, are
given in the Corporate Governance Report which forms part of this
Annual Report and / or in the Notice.
In compliance with the Companies Act, 2013 and Clause 49 of the Listing
Agreement, the performance evaluation of the Board was carried out
during the year under review. More details on the same are provided in
the Corporate Governance Report.
Auditors
M/s. Lovelock & Lewes, Chartered Accountants, Firm Registration
No.301056E, Auditors of the Company who retire at the forthcoming
Annual General Meeting are eligible for re-appointment and have
expressed their willingness to accept office, if re-appointed. They
have given a certificate to the effect that the re-appointment, if
made, would be within the provisions of Section 139 & 141 of the
Companies Act, 2013 and The Companies (Audit & Auditors) Rules, 2014.
Your Directors recommend their re-appointment from the conclusion of
the ensuing Annual General Meeting upto the conclusion of the next
Annual General Meeting.
Auditors' Report
The Auditors have observed that: During the period, the Company paid
managerial remuneration to its Managing Director which was in excess of
the limits specified in the Companies Act 2013 as disclosed in Note 43
of the Standalone Financial Statements.
The members may note that your Company is in the process of obtaining
Central Government approval for the same.
Subsidiary Companies
In accordance with Section 129(3) of the Companies Act, 2013, the
Company has prepared a consolidated financial statement of the Company
and all its subsidiary companies, which is forming part of the Annual
Report. A statement containing salient features of the financial
statements of the subsidiary companies is also included in the Annual
Report (AOC 1).
In accordance with third proviso of Section 136(1) of the Companies
Act, 2013, the Annual Report of the Company, containing therein its
standalone and the consolidated financial statements has been placed on
the website of the Company, www.thomascook.in. Further, as per fourth
proviso of the said section, audited annual accounts of each of the
subsidiary companies have also been placed on the website of the
Company, www.thomascook. in. Accordingly, the said documents are not
being attached to the Annual Report. Shareholders interested in
obtaining a copy of the audited annual accounts of the subsidiary
companies may write to the Company Secretary at the Company's
registered office.
As stipulated in Section 129 of the Companies Act, 2013 and Clause 32
of the Listing Agreement with the stock exchanges, the consolidated
financial statements have been prepared by the Company in accordance
with the applicable Accounting standards. There were no joint venture
or associate companies during the period under review.
Members may note that Avon Facility Management Services Limited, Magna
Infotech Limited and Hofincons Infotech & Industrial Services Private
Limited, wholly owned subsidiaries of Quess Corp Limited (Quess)
(previously IKYA Human Capital Solutions Limited) have amalgamated with
Quess Corp Limited during the year.
Acquisitions
The Board of Directors of the Company, Thomas Cook Insurance Services
(India) Limited ("TCISIL") & Sterling Holiday Resorts (India) Limited
("Sterling") have at their meetings held on 7th February, 2014 approved
a composite scheme of arrangement and amalgamation ("Scheme") pursuant
to which there will be: (i) a demerger of the resort and timeshare
business from Sterling to TCISIL, and (ii) amalgamation of residual
Sterling into the Company. Pursuant to the scheme, (i) 116 equity
shares of the Company will be issued to the shareholders of Sterling
for every 100 equity shares held in Sterling in consideration of the
demerger of the resort and timeshare business of Sterling from Sterling
to TCISIL; and (ii) 4 equity shares of the Company will be issued to
the shareholders of Sterling for every 100 equity shares held in
Sterling in consideration of the amalgamation of residual Sterling into
the Company.
Sterling filed its scheme with Hon'ble High Court of Madras in June,
2014 and TCIL & TCISIL had filed the scheme with the High Court of
Bombay in August 2014. The Shareholders and creditors of respective
companies approved the scheme in the prescribed manner. On 13th April,
2015, Hon'ble High Court of Madras sanctioned the Scheme of Sterling.
As on date, the Scheme filed by TCIL & TCISIL is yet to be sanctioned
by Hon'ble High Court of Bombay.
Other Downstream Acquisitions
2014-2015 was an eventful period on the acquisition front with Quess
closing 4 acquisitions (Hofincons, Brainhunter, MFX and Aramark India)
in a space of 9 months.
a) Hofincons:
a. Hofincons is a market leader in Industrial Asset Management in
India with pre-acquisition revenue of INR 147 cr and EBITDA of INR 15
cr.
b. Quess acquired Hofincons from Transfield Services in July 2014
marking Quess' entry into Industrial Asset Management. The acquisition
also complements Quess' Facility Management business by adding Hard
Services to the service bouquet.
b) Brainhunter:
a. Brainhunter is a Toronto headquartered IT staffing firm with
pre-acquisition revenues of INR 415 cr.
b. Quess acquired Brainhunter from ICICI Bank in October 2014. The
acquisition marks Quess' entry into the North American IT Staffing
market.
c) MFX:
a. Based out of Morristown, NJ (US), MFX is a leading provider of
hosted information technology applications and outsourcing solutions
for the U.S. commercial property and casualty insurance industry.
b. Quess acquired significant stake (49%) in MFX from Fairfax in
November 2014 for a nominal consideration. The acquisition of remaining
stake will be completed by end of 2015.
d) Aramark India:
a. Headquartered in Mumbai, Aramark India (renamed as Aravon) is a
facility management company with operations in more than 80 sites
pan-India. The company has a workforce of over 2,500 employees spread
across 9 states.
b. Quess acquired Aravon from Aramark, USA, in April 2015. The
acquisition is expected to give us a strong presence in Western India,
in addition to providing a niche presence in Hospitality and Healthcare
FM.
The above acquisitions are examples of Quess' philosophy of "deep value
investing". All of these acquisitions are in areas that are contiguous
to the business services space that Quess operates in and are expected
to emerge as key drivers of growth and profitability going forward.
Particulars regarding conservation of energy, technology absorption and
foreign exchange earnings and expenditure
Your Company being in the Travel and Tourism industry, its activities
do not involve any expenditure on Technology and Research and
Development and, therefore, the other particulars in the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rules, 1988 are not required to be submitted.
During the year, the foreign exchange earnings (on a standalone basis)
amounted to Rs. 724.40 million, whereas, the Company has incurred Rs.
169.94 million as expenditure in foreign currencies towards interest,
bank charges, license fees, professional fees, travelling,
subscriptions, etc., as disclosed in Note 33 in the Notes to the
accounts.
On a Consolidated basis, the foreign exchange earnings amounted to Rs.
3,329.4 million, whereas, the Company has incurred Rs. 268.3 million as
expenditure in foreign currencies towards interest, bank charges,
license fees, professional fees, travelling, subscriptions, etc.
Fixed Deposits
Your Company has not accepted deposits from the Public within the
meaning of Section 58A of the Companies Act, 1956 / Section 73, 74 and
76 of the Companies Act, 2013 and Rules framed thereunder and as such
no amount was outstanding on the date of the Balance Sheet.
Listing of Shares
Your Company is listed on two Stock Exchanges in India viz. BSE
Limited, Mumbai and National Stock Exchange of India Limited, Mumbai.
The Company has paid the Listing Fees to both the Stock Exchanges for
the Financial Years 2014-15 and 2015-2016.
Employees
Relations with the employees continued to be cordial throughout the
year. Your Directors place on record their appreciation of the
efforts, dedication, commendable teamwork and exemplary contribution of
the employees in the various initiatives of the Company and
contributing to the performance of the Company during the year under
review.
Special mention needs to be made of the co-operation received from the
Employees' Unions of Thomas Cook (India) Limited and Travel Corporation
(India) Limited.
Information pursuant to Section 217(2A) of the Companies Act, 1956
The particulars required under Section 217(2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
as amended, forms part of this Report and have been annexed herewith.
Corporate Governance and the Management Discussion and Analysis Report
Your Company continues to be committed to good corporate governance
aligned with the best corporate practices. It has also complied with
various standards set out by Securities and Exchange Board of India and
the Stock Exchanges where it is listed. The Management Discussion and
Analysis Report forms part of this Annual Report.
For the period ended 31st March, 2015, your Company has complied with
the requirements of Clause 49 of the Listing Agreement and other
applicable rules and regulations with respect to Corporate Governance
except clause 49(V)(D) in respect of formulating policy for determining
'material' subsidiaries, clause 49(VII)(C) and clause 49(VIII)(A) in
respect of formulating policy on materiality of Related Party
Transactions and policy on dealing with Related Party Transactions and
disclosing the same on the website of the Company for the quarter ended
31st December, 2014. However, for the quarter ended 31st December,
2014, the Company submitted the Corporate Governance Report to the
Exchanges on 14th January, 2015 with notes (remarks) indicating the
reasons for non-compliance being that the policies were already framed
but were only needed to be approved by the Board of Directors. Your
Company complied with the requirements immediately in January, 2015.
A certificate from a Practising Company Secretary obtained by the
Company regarding such compliance of conditions of Corporate Governance
is annexed to this report.
Secretarial Audit
For the period ended 31st March, 2015, pursuant to the requirements of
section 204(1) of the Companies Act, 2013 and Rule No. 9 of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014, your Company obtained a Secretarial Audit Report (SAR) from Mr.
Keyul M. Dedhia, Membership No: F7756 of Keyul M. Dedhia & Associates,
Company Secretaries in Practice. As per statutory requirements, SAR
forms part of this Annual Report.
The Secretarial Auditors have observed that, there was a delay by the
Company in giving prior intimation of Board Meeting to the Stock
Exchanges. Members may note that the reason for said delay was due to
ascertainment of availability of the Directors for the meeting and the
same was also clarified to the stock exchanges in the prescribed
manner.
The Secretarial Auditors have observed that, certain designated
employees of the Company had dealt in equity shares of the Company
without obtaining prior approval/ without giving post transaction
disclosures to the Compliance Officer and/or during non transaction
period as per Company's prevention of insider trading code. The Company
took necessary action in this respect including reporting to SEBI in
the prescribed manner, where necessary.
The Secretarial Auditors have observed that, in one particular
Corporate Governance Report filed by the Company with the Stock
Exchanges, the Company informed about non-compliance of certain clauses
of clause 49 of the Listing Agreement. Members may note that, However,
the Board of Directors had approved and adopted the said policies in
compliance with the requirements of Clause 49 aforementioned and a
clarification in this respect was also given to Stock Exchanges.
Members may note that, the policies were already framed but only needed
to be approved by the Board of Directors which was subsequently
complied with in January, 2015.
The Secretarial Auditors have observed that, the Competition Commission
of India (CCI) had imposed a consolidated penalty ofRs.10 million on
all the parties to the proposed Composite Scheme of Arrangement and
Amalgamation between Sterling Holidays Resorts (India) Limited, Thomas
Cook Insurance Services (India) Limited and the Company. The Company
had filed an appeal to Competition Appellate Tribunal (COMPAT) against
the said order and is awaiting final hearing on the same.
The Secretarial Auditors have observed that, the Company had made
excess payment of remuneration to Mr. Madhavan Menon, Managing
Director, for the fifteen month period i.e. January 1, 2014 to March
31, 2015 under the provisions of the Companies Act, 1956/ the Companies
Act, 2013. As informed by the management of the Company, the Company is
in process of obtaining approval of members and Central Government for
the waiver of the excess remuneration paid during the aforesaid period
under the applicable provisions of the Companies Act, 1956/ the
Companies Act, 2013.
Corporate Social Responsibility
Your Company has constituted a Corporate Social Responsibility (CSR)
Committee in accordance with the provisions of Section 135 of the
Companies Act, 2013 and applicable Rules. The CSR Committee was
constituted by the Board of Directors of the Company in March 2014. The
CSR Policy of Company was also uploaded on the website of the Company.
More detailed information about CSR forms part of Corporate Governance
Report.
However, members may note that as the financial year of your Company
commenced on 1st January, 2014, the provisions under Companies Act,
2013 and the Rules made thereunder for CSR are not applicable to your
Company for the period under review.
Disclosure under Sexual Harassment of Women at Workplace (Prevention,
Prohibition & Redressal) Act, 2013
Thomas Cook (India) Limited has Zero tolerance towards any action on
the part of any executive which may fall under the ambit of 'Sexual
Harassment' at workplace, and is fully committed to uphold and maintain
the dignity of every women executive working in the Company. The Policy
provides for protection against sexual harassment of woman at workplace
and for prevention and redressal of such complaints.
Number of complaints pending as on the beginning of the period Nil
Number complaints filed during the financial period Nil
Number of complaints pending as on the end of the period Nil
Particulars of Contracts or Arrangements with Related Parties
All the transactions with related parties are in the ordinary course of
business and on arm's length basis; and there are no material contracts
or arrangements or transactions at arm's length basis or otherwise and
thus disclosure in form AOC-2 is not required.
Documents forming part of Annual Report
Your Company's financial year under reference has commenced from 1st
January, 2014. The financial statements, Auditors' Report and
Directors' Report for the period is prepared as per relevant
provisions, schedules and rules of the Companies Act, 1956 as per
clarification provided by the Ministry of Corporate Affairs vide their
circular No. 8/2014 dated 4th April, 2014.
Acknowledgments
Your Directors thank all the Shareholders, Customers, Vendors for their
continued support throughout the year. Your Directors also thank the
Reserve Bank of India and other Banks, Ministry of Tourism, Financial
Institutions, Government of India, State Governments, and other
Government agencies for the support extended by them and also look
forward to their continued support in future.
Your Directors also wish to place on record their appreciation of the
contribution made by the Company's employees at all levels but for
whose hard work, solidarity and support, your Company's consistent
growth would not have been possible.
FOR AND ON BEHALF OF THE BOARD
M. K. SHARMA MADHAVAN MENON
Chairman Managing Director
Mumbai
Dated: 28th May, 2015
Dec 31, 2013
The Directors have pleasure in presenting the Thirty-Seventh Annual
Report, together with the Balance Sheet and Statement of Profit and
Loss for the financial year ended 31st December, 2013.
Rs. in Million except Earnings Per Share
Year ended Year ended
31st December
2013 31st December
2012
Total Revenue 3836 3864
Profit before Tax 703 738
Provision for Taxation 260 252
(Write back)/ Provision for
Deferred Taxation (18) (6)
Profit after Taxation 461 492
Transferred to General Reserve 46 49
Proposed Dividend 93 80
Earnings Per Share - Basic (per
equity share of Rs.1/- each) 1.96 2.31
Earnings Per Share - Diluted (per
equity share of Rs.1/- each) 1.91 2.26
Operations & Results
The Travel and Tourism Industry has maintained a steady pace of
recovery from the after effects of economic recession. Customers
remained cautious while spending on their travel and foreign exchange
requirements. Your Company continued its focus on launching new and
innovative products, while maintaining its concentration on acquisition
of new clients and providing un-paralleled customer service, which led
to maintaing moderate business volumes.
To keep up with the changing needs of the customers and to ensure
seamless delivery, your Company kept on investing in new technology.
The efforts to fortify the structure will continue in the coming year
as will cost management through efficiency and productivity improvement
leading to bottom-line growth.
Inbound tourism market has expanded due to efforts of government to
promote tourist attractions in India. Your Company expanded its Foreign
Exchange and Travel distribution network by opening several new stores
and appointing new franchisees across the country and launched an array
of new products to meet a wide range of customer needs. These new
products are targeted at new customer segments as part of strategy.
Your Company recorded total revenue of Rs. 3836 million and profit
before tax of Rs. 703 million with profit after tax being Rs. 461
million for the year ended 31st December 2013. The basic earning per
share of the Company is Rs. 1.96.
Thomas Cook Presence
As of December 2013 end, your Company, along with its subsidiaries,
continues to be among the largest integrated travel groups in India.
Your Company operates through 242 branches located in 99 cities, 165
PSAs and 134 Gold Circle Partner outlets to have a wider spread and
network across the country.
Your Company also has presence in 13 countries outside India through
its branches/ representative offices in USA (New York), Spain
(Barcelona & Madrid), UK (London), Japan (Tokyo), Germany (Frankfurt),
Nepal (Kathmandu), Australia (Sydney), China (Beijing), South Korea
(Seoul), Portugal (Porto), Russia (Moscow), apart from its subsidiaries
in Mauritius and Sri Lanka.
Share Capital Structure
The share capital structure as of 19th February, 2014 is as follows:
Authorised Capital: Rupees Rupees
Equity:
345827060 Equity Shares of Rs. 1/- each 345,827,060
Preference:
(i) 114760000 Class''A''4.65% Cumulative
Non-Convertible Redeemable Preference
Shares of Rs. 10/- each 1,147,600,000
(ii) 355294 Class ''B'' 0.001% Cumulative
Convertible / Redeemable Preference
Shares of Rs. 10/- each 3,552,940
(iii) 302000 Class ''C 0.001% Cumulative
Convertible / Redeemable Preference
Shares of Rs. 10/- each 3,020,000
(iv) 125000000 Preference Shares of
Rs. 10/- each 1,250,000,000
2,750,000,000
Issued, Subscribed and Paid-up
Capital:
Equity:
247680897 Equity Shares of Rs. 1/-
each 247,680,897
Preference:
(i) 319765 Class ''B'' 0.001% Cumulative
Convertible / Redeemable Preference
Shares of Rs. 10/- each 3,197,650
(ii) 271800 Class ''C 0.001% Cumulative
Convertible / Redeemable Preference
Shares of Rs. 10/- each 2,718,000
253,596,547
Note: Pursuant to the execution of the consent terms dated February 5,
2014 with LKP Finance Limited which the Board of Directors approved and
ratified at its meeting held on 7th February, 2014, the Company shall
convert 319,765 Class ''B'' 0.001% Cumulative Convertible/ Redeemable
Preference Shares of Rs. 10/- each and 271,800 Class ''C'' 0.001%
Cumulative Convertible / Redeemable Preference Shares of Rs. 10/- each
held by LKP Finance Limited in the Company, into 5,140,000 Equity
Shares of Rs. 1/- each of the Company, subject to necessary approvals.
Employees Stock Option Plans (ESOPs)
With the objective of motivating and retaining key talent in the
organisation and fostering ownership, your Company has framed the
Thomas Cook Employees Stock Option Plan 2007 and Thomas Cook Employees
Stock Option Plan (ESOP 2013) pursuant to the same, has granted stock
options to its employees over the years.
The Company has also introduced the Thomas Cook Save As You Earn Scheme
2010 (SAYE Scheme 2010) with similar objectives. SAYE Scheme 2010
allows employees to save a part of their net pay every month which gets
deposited with a bank in a recurring deposit account carrying fixed
rate of interest. At the end of 3 years, employees have the option to
either purchase specific number of equity shares of the Company at the
predetermined Exercise Price or withdraw the Monthly Savings
Contributions along with Interest accrued.
During the year 2013,1054000 options were approved for grant under the
Thomas Cook Employees Stock Option Plan 2007 and 4202438 options were
approved for grant under the Thomas Cook Employees Stock Option Plan
(ESOP 2013). However, there were no options were approved for grant
under SAYE Scheme 2010.
The Recruitment & Remuneration Committee administers and monitors the
schemes. The applicable disclosures under the Securities and Exchange
Board of India (Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999 (the Guidelines) are mentioned in the
Annexure to the Directors'' Report.
During the year, certain senior managerial personnel and other
employees have received options exceeding 5% of the value of the
options granted details of whom are annexed to this report. Further, no
employee has received options equal to or exceeding 1% of the issued
capital of the Company at the time of grant during the year.
Dividend
Your Directors recommend dividend on the Class ''B'' & Class ''C
Preference shares as per their terms, i.e. 0.001% (Rs. 0.0001 per share
of Rs. 10/- each) on the preference shares respectively. The Directors
are also pleased to recommend a dividend of 37.5% (Rs. 0.375 per share
of Rs. 1/- each) on the equity share capital.
The proposed dividend on the equity capital and preference capital
absorbs Rs. 93 million for dividend and Rs. 16 million for Dividend
Tax. The Board seeks the approval of the shareholders to the dividend
recommended on the preference and equity share capital as is
outstanding on the date of book closure/ record date.
General Reserve
Your Directors have resolved to transfer Rs. 46 million to General
Reserve out of the profits of the Company. With the transfer, the total
reserves stand at Rs. 5854 million as at 31st December 2013.
Director''s Responsibility Statement
The Directors would like to assure the Members that the financial
statements for the year under review conform in their entirety to the
requirements of the Companies Act, 1956 pursuant to Section 217 (2AA)
and that:
1. in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
2. the Directors have selected such accounting policies and applied
them consistently except where otherwise stated in the notes to the
accounts and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the Profit of the
Company for that period;
3. the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities. The internal auditors have conducted periodic audits to
provide reasonable assurances that established policies and procedures
of the Company have been followed. However, it must be recognised that
there are inherent limitations in weighing the assurances provided by
any system on internal controls;
4. the Directors have prepared the annual accounts on a going concern
basis.
Promoters
Fairfax Financial Holdings Limited
The current promoter of your Company, Fairbridge Capital (Mauritius)
Limited is a 100 % step down subsidiary of Fairfax Financial Holdings
Limited, ("Fairfax"), a Toronto based financial services holding
company with a global presence in insurance and reinsurance and a
portfolio of assets in excess of $30 billion invested worldwide. The
Company founded in 1985 by the present Chairman and Chief Executive
Officer, Mr. Prem Watsa, has over the past 29 years, demonstrated a
strong financial track record to achieve an annual appreciation in Book
Value per share of 21.3%. Fairfax is listed on Toronto Stock Exchange.
Fairfax has 20 general insurance subsidiaries and joint ventures
globally, including ICICI Lombard (India). The portfolio also includes
several market leading insurance companies such as Odyssey Re (USA),
Crum & Forster (USA), First Capital (Singapore), Fairfax Brasil
(Brazil), Gulf Insurance (Kuwait).
Fairfax is engaged in long term investments from its own resources,
with a focus to deliver long term capital appreciation through a
flexible and value oriented approach.
Thomas Cook (India) Limited is a part of Fairfax group. As on date, the
promoter holds 74.96% of the total paid up equity share capital of the
Company.
Thomas Cook (India) Limited
Operations in India [including subsidiaries]
The year 2013 saw the overall Foreign Exchange volumes increase by 5.7%
despite the uncertainty that surrounded the Rupee for most part of the
year.
The year saw appreciable growth of our portfolio of retail products.
The strong leisure travel trends for both group and individual travel
business and the outreach program with channel partners helped grow the
Holiday foreign exchange business by 18%. Despite the weakness in the
Rupee which makes studying abroad a more expensive proposition, the
student business grew by 3% over last year on account of various
targeted digital marketing initiatives taken during the year.
Corporate remained cautious while spending on travel and foreign
exchange. Your Company continued focus on acquisition of new clients
and strove to provide un-paralleled customer service along with a suite
of products, which led to a moderate increase of 8% in volumes.
Your Company further strengthened its Inward Remittance business both
from a penetration perspective as well as from a business growth
perspective. According to the latest issue of the World Bank''s
''Migration and Development Brief, released on 2nd October, 2013, India
is expected to have received USD 71 billion in the year 2013 and to
have remained the top recipient of Inward remittances for the sixth
consecutive year. Your Company has grown its inward remittance business
at a faster rate than this growth in the overall inward remittance
market in India and ended the year with over 18,000 agent locations
across the country. The volumes in this business have grown at a CAGR
of 31% over the last 3 years.
In the light of handsome growth in the insurance sector, the Company
continues its focus on Travel insurance. With the strategy of being a
complete travel solution provider, the insurance arm of Thomas Cook
tries to understand the specific needs of the customers and offers the
best product which suits the requirement. It helps in garnering higher
share of wallet and building customer loyalty.
The depreciation of rupee by 12% did make India a more attractive
destination, but inbound tourism has not grown to the expectations due
to sluggish economic climate in source markets in 2013.
Cost Management programme continued, so as to optimize manpower
resources. We commenced settling of airline payments for some airlines
via corporate credit card, which afforded us higher credit period. We
also had a deeper penetration in our offshore ticketing business where
we greatly increased the volumes of ticketing from outside India to the
country, thereby boosting up our revenue.
With technology being the main driver, the Company will also be in a
position to do an intelligent cross sell to the existing as well as
newly acquired customer base and drive efficiencies.
MICE offer a potential for high revenue earnings but corporate clients
have reduced MICE related activities due to rising airline fares, hotel
fares etc., which has caused a significant overall increase in cost of
these activities. Competition in this sector and budget constraints
have limited the destination options. Despite these challenges, your
Company has witnessed an overall growth in MICE revenue by tapping new
markets and serving new clients.
Through the step down subsidiary viz: TC Visa Services (India) Limited,
the Company handled 1.6 mn transactions in 2013 with a growth of 40% in
direct business through direct corporate and walk-in applicants and is
growing leaps and bounds capturing and setting a strong foot in the
Visa business. Apart from catering to the Travel Businesses of your
Company and adding direct external customers for their visa and
passport needs, it also serves ancillary transactions [Attestations,
Legalization, Apostille, Translation, Notarization of documents,
Foreigners Regional Registration Office (FRRO) registration/ visa
extension/ exit permit, procures People of Indian Origin (PIO)/
Overseas Citizen of India (OCI) cards]. Additionally, your Company has
tied up with attorneys to service the long-term immigration visas/ work
permits required by corporate for their projects abroad to move their
resources to these countries.
eBusiness continues to be a focus area for your Company as part of
comprehensive multichannel strategy. The call-center was also
strengthened in 2013 and saw a phenomenal growth in bookings. Our
company also strengthened its position in the agents and SME segment
that uses the online booking portal to serve the customer better. Our
company now has active engagement with current and potential customers
through social media and other digital platforms.
Operations in Mauritius
The recession in European countries which directly impacted the tourist
inflow into the country also reduced spending of foreign travelers
impacting the retail part of the business. The fall of EURO against USD
to 1.35 in the mid of the year affected the overall Foreign Exchange
business. Apart from the above, intervention on spread margins by Bank
of Mauritius (BOM) impacted the business since Jan 2013.
Thomas Cook Mauritius has consolidated all its operations by
rationalization of branches, controls have been beefed up, processes
have been strengthened to cater to the future expansion plans of the
organization. Mauritius operations consist of 15 branches across the
island. We have adopted a systematic approach to training on the area
of concern to improve the productivity of staff. The Company has
embarked on a major process restructuring and cost control measures.
Operations in Sri Lanka
Thomas Cook Lanka (Private) Limited has outlets both at the Arrival and
Departure terminals at the Bandaranaike International Airport. With
political stability continuing in Sri Lanka, Thomas Cook Lanka
(Private) Limited intends to further expand its operations.
Thomas Cook Lanka (Private) Limited serves as an investment vehicle for
any proposed future investments into Sri Lanka subject to requisite
regulatory approvals.
Awards and Accolades
Thomas Cook (India) Limited has been the recipient of the following
highly prestigious awards and accolades in 2013:
Best Tour Operator at the Lonely Planet Travel Awards 2013
Favorite Specialist Tour Operator at the Conde Nast Traveler Readers''
Travel Awards 2013
Best Tour Operator-Outbound at the CNBCAWAAZ Travel Awards 2013
National Tourism Awards 2011-2012; 3 prestigious awards:
1. Best Inbound Tour Operator in (Category I): Third Prize
2. Best Tour Operator promoting Niche Segments other than Adventure &
MICE
3. Award of Excellence: Best Tourism Promotion Publicity Material
(Private Stakeholder) -Joint winner
Retailer of the Year - Leisure & Holidays by ET NOW 2012
Centre of Learning has received IATA accreditation as "Top 10 South
Asia IATA Authorized Training Centers", 2013
Directors
In accordance with Article 131 of the Articles of Association of the
Company, Mr. Harsha Raghavan, Mr. Chandran Ratnaswami and Mr. Uday
Chander Khanna, retire by rotation and being eligible, offer themselves
for re-appointment to the Board.
The above appointments/ re-appointments form part of the Notice of the
Thirty- seventh Annual General Meeting and the relevant Resolutions are
recommended for your approval.
Profiles of these Directors, as required by the Listing Agreement
provisions, are given in the Corporate Governance Report forming part
of this Annual Report/ Notice.
Auditors
M/s. Lovelock & Lewes, Chartered Accountants, Firm Registration
NO.301056E, Auditors of the Company who retire at the forthcoming
Annual General Meeting are eligible for re-appointment and have
expressed their willingness to accept office, if re-appointed. They
have given a certificate to the effect that the re-appointment, if
made, would be within the limits prescribed under Section 224(1 B) of
the Companies Act, 1956. Your Directors recommend their re-appointment.
Subsidiary Companies
Pursuant to the provisions of Section 212 of the Companies Act, 1956,
the Ministry of Corporate Affairs vide its circular dated February 8th,
2011, has granted general exemption from attaching the Balance Sheet,
Profit and Loss Account and other documents of the subsidiary companies
with the Balance Sheet of the Company. Accordingly, the said documents
are not being attached with the Balance Sheet of the Company. A
statement containing brief financial details of the Company''s
Subsidiaries is contained elsewhere in the Annual Report. The annual
accounts of these subsidiaries and the related detailed information
will be made available to any member of the Company/ its subsidiaries
seeking such information at any point of time and are also available
for inspection by any member of the Company/ its subsidiaries at the
registered office of the Company and that of the respective subsidiary
companies. The Company shall furnish a copy of details of annual
accounts of subsidiaries to any member on demand.
Further, your Company acquired 74.85% of shareholding in IKYA Human
Capital Solutions Private Limited (now IKYA Human Capital Solutions
Limited) on a fully diluted basis. The said acquisition was completed
on 14th May, 2013.
Acquisition
The Board of Directors of the Company, Thomas Cook Insurance Services
(India) Limited ("TCISIL") & Sterling Holiday Resorts (India) Limited
("Sterling") have at their meetings held on 7th February, 2014 approved
a composite scheme of arrangement and amalgamation pursuant to which
there will be: (i) a demerger of the resort and timeshare business from
Sterling to TCISIL, and (ii) amalgamation of residual Sterling into the
Company. Pursuant to the scheme, (i) 116 equity shares of the Company
will be issued to the shareholders of Sterling for every 100 equity
shares held in Sterling in consideration of the demerger of the resort
and timeshare business of Sterling from Sterling to TCISIL; and (ii) 4
equity shares of the Company will be issued to the shareholders of
Sterling for every 100 equity shares held in Sterling in consideration
of the amalgamation of residual Sterling into the Company.
Further, the Company has agreed to subscribe up to 3,60,00,000 equity
shares of Thomas Cook Insurance Services (India) Limited, a wholly
owned subsidiary of the Company, having face value of Rs. 10 each for
an aggregate consideration upto Rs. 7,20,00,00,000 at a premium of INR
190 per share. TCISIL will be using such funds for acquisition of
shares of Sterling, including as follows: (i) subscription up to
20,650,000 equity shares of Sterling, (ii) purchase of up to 18,007,677
equity shares of Sterling from certain existing shareholders, and (iii)
an open offer for 26% of the diluted share capital of Sterling, in
terms of the SEBI (Substantial Acquisition of Shares and Takeovers)
Regulations, 2011.
In order to partly fund the investment proposed to be made by TCISIL in
Sterling, the parent of the Company, being Fairbridge Capital
(Mauritius) Limited has agreed to subscribe to compulsorily convertible
preference shares to comply with the provisions of the FDI Policy,
subject to receipt of applicable approvals and consents. Accordingly,
the Company has proposed to create, offer, issue and allot in one or
more tranches, on private placement and/or preferential basis, up to
62,50,000 compulsorily convertible preference shares of Rs. 10 each
(CCPS) at a price of Rs. 800 each which includes a premium of Rs. 790
per CCPS of the Company, each such CCPS being convertible into 10
equity shares of the Company having face value of Rs. 1 each.
All of the aforesaid transactions are subject to conditions precedent
and regulatory approvals, as deemed necessary.
Particulars regarding conservation of energy, technology absorption and
foreign exchange earnings and expenditure
Your Company being in the Travel and Tourism industry, its activities
do not involve any expenditure on Technology and Research and
Development and, therefore, the other particulars in the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rules, 1988 are not required to be submitted.
During the year, the foreign exchange earnings (on a standalone basis)
amounted to Rs. 410 million, whereas, the Company has incurred Rs. 83
million as expenditure in foreign currencies towards interest, bank
charges, licence fees, professional fees, travelling, subscriptions,
etc., as disclosed in Note 32 in the Notes to the accounts.
On a Consolidated basis, the foreign exchange earnings amounted to Rs.
1,807 million, whereas, the Company has incurred Rs. 231 million as
expenditure in foreign currencies towards interest, bank charges,
licence fees, professional fees, travelling, subscriptions, etc.
Fixed Deposits
Your Company has not accepted deposits from the Public within the
meaning of Section 58A of the Companies Act, 1956 and Rules framed
there under and as such no amount was outstanding on the date of the
Balance Sheet.
Listing of Shares
Your Company is listed on two Stock Exchanges in India viz. BSE
Limited, Mumbai and National Stock Exchange of India Limited, Mumbai.
The Company has paid the Listing Fees to both the Stock Exchanges for
the Financial Year 2013-2014.
Employees
Relations with the employees continued to be cordial throughout the
year. Your Directors place on record their appreciation of the efforts,
dedication, commendable teamwork and exemplary contribution of the
employees in the various initiatives of the Company and contributing to
the performance of the Company during the year under review.
Special mention needs to be made of the co-operation received from the
Employees'' Unions of Thomas Cook (India) Limited and Travel Corporation
(India) Limited.
Information pursuant to Section 217(2A) of the Companies Act, 1956
The particulars required under Section 217(2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
as amended, forms part of this Report and have been annexed herewith.
Corporate Governance
Your Company continues to be committed to good corporate governance
aligned with the best corporate practices. It has also complied with
various standards set out by Securities and Exchange Board of India and
the Stock Exchanges where it is listed. The Management Discussion and
Analysis Report forms part of this Annual Report.
For the year ended 31st December, 2013, your Company has complied with
the requirements of Clause 49 of the Listing Agreement and other
applicable rules and regulations with respect to Corporate Governance.
A certificate from a Practicing Company Secretary obtained by the
Company regarding such compliance of conditions of Corporate Governance
is attached to this report.
Acknowledgments
Your Directors thank all the Shareholders, Customers, Vendors for their
continued support throughout the year. We also thank Reserve Bank of
India and other Banks, Ministry of Tourism, Financial Institutions,
Government of India, State Governments, and other Government agencies
for the support extended by them and also look forward to their
continued support in future.
Your Directors also wish to place on record their appreciation of the
contribution made by the Company''s employees at all levels but for
whose hard work, solidarity and support your Company''s consistent
growth would not have been even possible.
FOR AND ON BEHALF OF THE BOARD
M. K. SHARMA MADHAVAN MENON
Chairman Managing Director
Mumbai
19th February, 2014
Dec 31, 2012
To the Members:
The Directors have pleasure in presenting the Thirty-sixth Annual
Report, together with the Balance Sheet and Statement of Profit and
Loss for the year ended 31st December, 2012.
Rs. in Million except Earnings Per Share
Year ended Year ended
31st December
2012 31st December
2011
Total Revenue 3864 3568
Profit before Tax 738 829
Provision for Taxation 252 263
(Write back)/ Provision for Deferred Taxation (6) 6
Profit after Taxation 492 559
Transferred to General Reserve 49 56
Proposed Dividend 80 80
Earnings Per Share - Basic (per equity
share of Rs. 1/- each) 2.31 2.64
Earnings Per Share - Diluted (per equity
share of Rs. 1/- each) 2.26 2.57
Operations & Results
The Travel and Tourism Industry has recovered following the last
economic recession, which saw falling demand for tourism activity as
consumers postponed trips to concentrate their budgets on more
essential areas. Inbound tourism market has expanded due to efforts of
government to promote tourist attractions in India. Your Company
expanded its Foreign Exchange and Travel distribution network by
opening several new stores and appointing new franchisees across the
country and launched an array of new products to meet a wide range of
customer needs. These new products are targeted at new customer
segments.
Your Company continued focus on acquiring new clients and strived to
provide un-paralleled customer service along with a suite of products.
The efforts to fortify the structure will continue in the coming year
as will cost management through efficiency and productivity improvement
leading to bottom-line growth.
Your Company recorded total revenue of Rs. 3864 million and profit
before tax of Rs. 738 million with profit after tax being Rs. 492
million for the year ended 31st December 2012. The basic earning per
share of the Company is Rs. 2.31.
Thomas Cook Presence
As of December 2012 end, your Company, along with its subsidiaries,
continues to be among the largest integrated travel group in India. It
operates through over 253 locations by way of its own branches, and
additional presence by way of Preferred Sales Agents (PSA''s) and
Franchisee Offices. Your Company has 158 branches located in 78 cities,
169 PSAs and 124 Gold Circle Partner outlets to have a wider spread and
network across the country.
Your Company also has presence in 5 countries outside India through our
branches/ representative offices in USA (New York), Spain (Barcelona &
Madrid), UK (London), Japan (Tokyo) and Germany (Frankfurt), apart from
its subsidiaries in Mauritius and Sri Lanka.
Share Capital Structure
The share capital structure as of 19th February, 2013 is as follows:
Authorised Capital: Rupees Rupees
Equity:
345827060 Equity Shares of Rs. 1/- each 345,827,060
Preference:
(i) 114760000 Class ''A'' 4.65%
Cumulative Non-Convertible Redeemable
Preference Shares of Rs. 10/- each 1,147,600,000
(ii) 355294 Class ''B'' 0.001%
Cumulative Convertible / Redeemable
Preference Shares of Rs. 10/- each 3,552,940
(iii) 302000 Class ''C'' 0.001%
Cumulative Convertible / Redeemable
Preference Shares of Rs. 10/- each 3,020,000
(iv) 125000000 1% Cumulative
Non-Convertible Redeemable Preference
Shares of Rs. 10/- each 1,250,000,000
2,750,000,000
Issued, Subscribed and Paid-up Capital:
Equity:
213158694 Equity Shares of Rs. 1/- each 213,158,694
Preference:
(i) 319765 Class ''B'' 0.001%
Cumulative Convertible / Redeemable
Preference Shares of Rs. 10/- each 3,197,650
(ii) 271800 Class ''C'' 0.001%
Cumulative Convertible / Redeemable
Preference Shares of Rs. 10/- each 2,718,000
219,074,344
Employees Stock Option Plans (ESOPs)
With the objective of motivating and retaining key talent in the
organisation and fostering ownership, your Company has framed the
Thomas Cook Employees Stock Option Plan 2007 and pursuant to the same,
has granted stock options to its employees over the years.
The Company has also introduced the Thomas Cook Save As You Earn Scheme
2010 (SAYE Scheme 2010) with similar objectives. SAYE Scheme 2010
allows employees to save a part of their net pay every month which gets
deposited with a bank in a recurring deposit account carrying fixed
rate of interest. At the end of 3 years, employees have the option to
either purchase specific number of equity shares of the Company at the
predetermined Exercise Price or withdraw the Monthly Savings
Contributions alongwith Interest accrued.
During the year 2012, no options were approved for grant under the
Thomas Cook Employees Stock Option Plan 2007 and SAYE Scheme 2010.
The Recruitment & Remuneration Committee administers and monitors the
schemes. The applicable disclosures under the Securities and Exchange
Board of India (Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999 (the Guidelines) are mentioned in the
Annexure to the Directors'' Report.
During the year, no senior managerial personnel or any other employee
has received options exceeding 5% of the value of the options granted.
Further, no employee has received options equal to or exceeding 1% of
the issued capital of the Company at the time of grant during the year.
Dividend
Your Directors recommend dividend on the Class ''B'' & Class ''C''
Preference shares as per their terms, i.e. 0.001% (Rs. 0.0001 per share
of Rs. 10/- each) on the preference shares respectively. The Directors
are also pleased to recommend a dividend of 37.5% (Rs. 0.375 per share
of Rs. 1/- each) on the equity share capital.
The proposed dividend on the equity capital and preference capital
absorbs Rs. 80 million for dividend and Rs. 13 million for Dividend
Tax. The Board seeks the approval of the shareholders to the dividend
recommended on the preference and equity share capital as is
outstanding on the date of book closure/ record date.
General Reserve
Your Directors have resolved to transfer Rs. 49 million to General
Reserve out of the profits of the Company. With the transfer, the total
reserves stand at Rs. 3766 million as at 31st December 2012.
Directors'' Responsibility Statement
The Directors would like to assure the Members that the financial
statements for the year under review conform in their entirety to the
requirements of the Companies Act, 1956 pursuant to Section 217 (2AA)
and that:
1. in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
2. the Directors have selected such accounting policies and applied
them consistently except where otherwise stated in the notes to the
accounts and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the Profit of the
Company for that period;
3. the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities. The internal auditors have conducted periodic audits to
provide reasonable assurances that established policies and procedures
of the Company have been followed. However, it must be recognised that
there are inherent limitations in weighing the assurances provided by
any system on internal controls;
4. the Directors have prepared the annual accounts on a going concern
basis.
Promoters
Fairfax Financial Holdings Limited
The current promoter of your Company, Fairbridge Capital (Mauritius)
Limited is a 100 % step down subsidiary of Fairfax Financial Holdings
Limited, ("Fairfax"), a Toronto based financial services holding
company with a global presence in insurance and reinsurance and a
portfolio of assets in excess of $30 billion invested worldwide. The
Company founded in 1985 by the present Chairman and Chief Executive
Officer, Mr. Prem Watsa, has over the past 25 years, demonstrated a
strong financial track record to achieve an annual appreciation in Book
Value per share of 24.7% annually. Fairfax is listed on Toronto Stock
Exchange.
Fairfax has 20 general insurance subsidiaries and joint ventures
globally, including ICICI Lombard (India). The portfolio also includes
several market leading insurance companies such as Odyssey Re (USA),
Crum & Forster (USA), First Capital (Singapore), Fairfax Brasil
(Brazil), Gulf Insurance (Kuwait).
Fairfax is engaged in long term investments from its own resources,
with a focus to deliver long term capital appreciation through a
flexible and value oriented approach.
Thomas Cook (India) Limited is a part of Fairfax group. As on date, the
promoter holds 87.10% of the total paid up equity share capital of the
Company.
Thomas Cook (India) Limited
Operations in India [including subsidiaries]
The year 2012 saw the overall Foreign Exchange volumes increase by 5.7%
despite the uncertainty that surrounded the Rupee for most part of the
year. The year saw appreciable growth of our portfolio of retail
products. The strong leisure travel trends for both group and
individual travel business and the outreach program with channel
partners helped growth in the Holiday business. With change of visa
norms in the UK, the student business was sluggish but with more
students going to Australia and Canada things improved towards the end
of the year. The ''Maintenance of close relatives'' was another product
which saw tremendous growth on account of channel activation and
awareness creation through marketing, with volume growth upwards of
30%.
Corporates remained cautious while spending on travel and foreign
exchange. Your Company continued focus on acquisition of new clients
and strived to provide un-paralleled customer service along with a
suite of products, which led to a moderate increase of 9% in volumes.
Your Company maintained its lead in the thought leadership through the
successful launch of its 2nd White Paper on Convergence of Travel &
Technology, in 3 cities across India. Despite intense competition
amongst large and smaller players in the Corporate Travel business, the
topline grew by 15%; although while the higher airfares give a
perception of increased sales, in actual fact, the number of
International transactions remained flat, and the domestic tickets have
declined (this is in line with DGCA trend of domestic transactions as
well). It can be thus inferred that travel was inevitable for some, and
big companies with financial muscle continued to travel while the
smaller ones have restricted their travel during 2012. Higher fares
this year have distorted travel budgets of some customers, and to
offset that some corporations have reduced internal travel.
In the light of handsome growth in the insurance sector, the Company
continues its focus on Travel insurance. With the strategy of being a
complete travel solution provider, the insurance arm of Thomas Cook
tries to understand the specific needs of the customers and offers the
best product which suite the requirement. It helps us in garnering
higher share of wallet and building customer loyalty.
Continued negotiation with service providers has helped our Company
protect margins in the Inbound business. The increase in total ticketed
volume for the combined travel businesses enables us by increasing our
bargaining power with service providers to offer competitive
products/prices. Costs are kept under a tight control, along with
several initiatives to increase productivity. To improve efficiency and
promote growth, our Company restructured the inbound sales and
operations team.
With technology being the main driver, the Company will also be in a
position to do an intelligent cross sell to the existing as well as
newly acquired customer base and drive efficiencies.
MICE offers a potential for high revenue earnings but corporate clients
have reduced MICE related activities due to rising airline fares, hotel
fares etc., which has caused a significant overall increase in cost of
these activities. Competition in this sector and budget constraints
have limited the destination options. Despite these challenges, our
Company has witnessed an overall growth in MICE revenue by tapping new
markets and serving new clients.
Visa and Passport Business, the four-year old vertical of your Company
with over 0.15 million transactions in the year is growing from
strength to strength. Apart from catering to the Travel Businesses of
your Company, it has added direct external customers for their visa,
passport and ancillary services [Attestations, Legalization, Apostille,
Translation, Notarization of documents, Foreigners Regional
Registration Office (FRRO) registration/ visa extension/ exit permit,
procures People of Indian Origin (PIO) / Overseas Citizen of India
(OCI) cards]. Additionally, Your Company has tied up with attorneys to
service the long-term immigration visas/ work permits required by
corporates for their projects abroad to move their resources to these
countries.
The content site developed by the business has now been packaged and is
being promoted and sold as a reckoner to the travel industry and is
also being shared with internal businesses for visa information.
Informative and rich in content, it facilitates travellers who wish to
apply for visas and provides detailed information to intermediary
customers and agents. It also has an online tracker enabling tracking
the documents through its various stages of processing.
Operations in Mauritius
The recession in European countries which directly impacted the tourist
inflow into the country also reduced spending of foreign travelers
impacting the retail part of the business. The fall of EURO against USD
to 1.23 in the mid of the year affected the overall Foreign Exchange
business.
Thomas Cook Mauritius has consolidated all its operations by
rationalization of branches, controls have been beefed up, processes
have been strengthened to cater to the future expansion plans of the
organization. Mauritius operations consist of 15 branches across the
island and we have expansion plans in high end shopping malls this
year, which will increase retail footprint of foreign tourists and
local customers. We have adopted a systematic approach to training on
the area of concern to improve the productivity of staff. The company
has embarked on a major process restructuring and cost control
measures.
Operations in Sri Lanka
2012 brings the commencement of expansion plan for Sri Lanka Thomas
Cook operations, wherein Thomas Cook Sri Lanka Branch business was
transferred to a newly incorporated company styled as "Thomas Cook
Lanka (Private) Limited". The Company has outlets both at the Arrival
and Departure terminals at the Bandaranaike International Airport. With
political stability returning to Sri Lanka, Thomas Cook Lanka (Private)
Limited intends to further expand its operations.
Thomas Cook Lanka (Private) Limited serves as an investment vehicle for
any proposed future investments into Sri Lanka subject to requisite
regulatory approvals.
Awards and Accolades
Thomas Cook (India) Limited has been the recipient of the following
highly prestigious awards and accolades in 2012:
* The Most Trusted Brand in travel services by The Brand Trust
ReportÂ, India study 2012
* Favourite Specialist Tour Operator at the Conde Nast Traveller
Readers'' Travel Awards 2012.
* Best Corporate Travel Management Company by World Travel Brands 2012
* "Consumer Superbrand" 2011-2012 by Superbrands for ''Travel
Smooth''
* Centre of Learning has received IATA accreditation as "Top 10 South
Asia IATA Authorized Training Centers", 2012
Directors
In accordance with Article 131 of the Articles of Association of the
Company, Mr. M. K. Sharma, Mr. Ramesh Savoor and Mr. Krishnan
Ramachandran, retire by rotation and being eligible, offer themselves
for re-appointment to the Board.
Mr. Chandran Ratnaswami, Mr. Harsha Raghvan, Mr. Uday Khanna and Mrs.
Kishori Udeshi were appointed as Additional Directors with effect from
22nd August, 2012, 22nd August, 2012, 29th October, 2012 and 25th
January, 2013 respectively. As Additional Directors, they hold office
upto the date of the ensuing Annual General Meeting of the Company at
which they are being proposed for regularisation.
The above appointments/ re-appointments form part of the Notice of the
Thirty-sixth Annual General Meeting and the relevant Resolutions are
recommended for your approval.
Profiles of these Directors, as required by the Listing Agreement
provisions, are given in the Corporate Governance Report forming part
of this Annual Report/ Notice.
During the period, Mr. Rakshit Desai, Mr. Vinayak Purohit, Mr. Hoshang
Billimoria and Mr. Anant Rajwade resigned as Directors of the Company.
The Board places on record its sincere appreciation for the
contribution made by these Directors during their tenure as Directors
of the Company.
Auditors
M/s. Lovelock & Lewes, Chartered Accountants, Firm Registration
No.301056E, Auditors of the Company who retire at the forthcoming
Annual General Meeting are eligible for re-appointment and have
expressed their willingness to accept office, if re-appointed. They
have given a certificate to the effect that the re-appointment, if
made, would be within the limits prescribed under Section 224(1B) of
the Companies Act, 1956. Your Directors recommend their re-
appointment.
Subsidiary Companies
Pursuant to the provisions of Section 212 of the Companies Act, 1956,
the Ministry of Corporate Affairs vide its circular dated February 8th,
2011, has granted general exemption from attaching the Balance Sheet,
Profit and Loss Account and other documents of the subsidiary companies
with the Balance Sheet of the Company. Accordingly, the said documents
are not being attached with the Balance Sheet of the Company. A
statement containing brief financial details of the Company''s
Subsidiaries is contained elsewhere in the Annual Report. The annual
accounts of these subsidiaries and the related detailed information
will be made available to any member of the Company/ its subsidiaries
seeking such information at any point of time and are also available
for inspection by any member of the Company/ its subsidiaries at the
registered office of the Company and that of the respective subsidiary
companies. The Company shall furnish a copy of details of annual
accounts of subsidiaries to any member on demand.
Further, pursuant to the approval of Reserve Bank of India and as per
the requirements and approval of the Central Bank of Sri Lanka, Thomas
Cook (India) Limited has incorporated a Wholly Owned Subsidiary (WOS)
in Sri Lanka styled, Thomas Cook Lanka (Private) Limited on 20th April,
2012, for the purpose of transfer of branch business in Sri Lanka. With
effect from 1st August, 2012, the Company has transferred its Sri Lanka
branch business to its WOS, Thomas Cook Lanka (Private) Limited.
Particulars regarding conservation of energy, technology absorption and
foreign exchange earnings and expenditure
Your Company being in the Travel and Tourism industry, its activities
do not involve any expenditure on Technology and Research and
Development and, therefore, the other particulars in the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rules, 1988 are not required to be submitted.
During the year, the foreign exchange earnings (on a standalone basis)
amounted to Rs. 462 million, whereas, the Company has incurred Rs. 88
million as expenditure in foreign currencies towards interest, bank
charges, licence fees, professional fees, travelling, subscriptions,
etc., as disclosed in Note 31 in the Notes to the accounts.
During the year, Travel Corporation (India) Limited, a subsidiary, also
earned Foreign Exchange amounting to Rs. 1372 million and incurred Rs.
41 million towards salary, legal & professional fees, travelling, etc.
including expenditure incurred by foreign branches.
Fixed Deposits
Your Company has not accepted deposits from the Public within the
meaning of Section 58A of the Companies Act, 1956 and Rules framed
thereunder and as such no amount was outstanding on the date of the
Balance Sheet.
Listing of Shares
Your Company is listed on two Stock Exchanges in India viz. BSE
Limited, Mumbai and National Stock Exchange of India Limited, Mumbai.
The Company has paid the Listing Fees to both the Stock Exchanges for
the Financial Year 2012-2013.
Employees
Relations with the employees continued to be cordial throughout the
year. Your Directors place on record their appreciation of the efforts,
dedication, commendable teamwork and exemplary contribution of the
employees in the various initiatives of the Company and contributing to
the performance of the Company during the year under review.
Special mention needs to be made of the co-operation received from the
Employees'' Unions of Thomas Cook (India) Limited and Travel
Corporation (India) Limited.
Information pursuant to Section 217(2A) of the Companies Act, 1956
The particulars required under Section 217(2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
as amended, forms part of this Report and have been annexed herewith.
Corporate Governance
Your Company continues to be committed to good corporate governance
aligned with the best corporate practices. It has also complied with
various standards set out by Securities and Exchange Board of India and
the Stock Exchanges where it is listed. The Management Discussion and
Analysis Report forms part of this Annual Report.
For the year ended 31st December, 2012, your Company has complied with
the requirements of Clause 49 of the Listing Agreement and other
applicable rules and regulations with respect to Corporate Governance.
A certificate from a Practising Company Secretary obtained by the
Company regarding such compliance of conditions of Corporate Governance
is attached to this report.
Acknowledgments
Your Directors thank all the Shareholders, Customers, Vendors for their
continued support throughout the year. We also thank Reserve Bank of
India and other Banks, Ministry of Tourism, Financial Institutions,
Government of India, State Governments, and other Government agencies
for the support extended by them and also look forward to their
continued support in future.
Your Directors also wish to place on record their appreciation of the
contribution made by the Company''s employees at all levels but for
whose hard work, solidarity and support your Company''s consistent
growth would not have been possible.
FOR AND ON BEHALF OF THE BOARD
M. K. SHARMA MADHAVAN MENON
Chairman Managing Director
Mumbai
Dated: 19th February, 2013
Dec 31, 2011
The Directors have pleasure in presenting the Thirty-fifth Annual
Report, together with the Balance Sheet and Profit and Loss Account for
the year ended 31st December, 2011.
Rs in Million
Year ended Year ended
31st December,
2011 31st December,
2010
Revenues 3491 2792
Profit before Taxation and
Exceptional Items 829 532
Exceptional Items - 100
Profit after Exceptional item
and before Tax 829 632
Provision for Taxation 263 209
Provision for Deferred Taxation 7 8
Profit after Taxation 559 415
Transferred from Reserve
U/sec. 80 HHD of the Income
Tax Act, 1961 - 15
Transferred to General Reserve 56 42
Proposed Dividend * 80 79
Earnings Per Share (Basic)
after exceptional items (per
equity share of
Rs 1/- each) 2.64 1.96
Earnings Per Share (Diluted)
after exceptional items (per
equity share of Rs 1/- each) 2.57 1.91
* Includes preference share dividend
Operations & Results
The year 2011 was challenging to the global and local economies. All
industries including Foreign Exchange, Tourism and Travel industry,
suffered due to turmoil in North Africa and the Middle East, flooding
in Asia, the earthquake and tsunami in Japan, and of course the
economic instability that still grips many European countries. Like the
previous two years, the year 2011 too witnessed a volatility in Indian
Rupee (INR) against all the major currencies.
Economic pressures around the world offered leisure and business
travellers plenty of reasons to look for maximum value in their travel
spending. Accordingly, travel operators, too, have been battling to
deliver superior value to their customers. Despite the constraints
faced by worldwide tourism industry, it has shown some resilience and
continued to grow.
Despite the economic and other challenges faced, your Company reports
an increase in revenue by Rs 699 million.
Your Company recorded turnover of Rs 3491 million and profit before tax
and exceptional item of Rs 829 million with profit after tax being Rs 559
million for the year ended 31st December, 2011. The basic earning per
share of the Company is Rs 2.64.
Thomas Cook Presence
As of December 2011 end, Thomas Cook (India) Limited, along with its
subsidiaries, continues to be the largest integrated travel group in
India with over 216 locations by way of its own branches, and
additional presence by way of Preferred Sales Agents (PSAs) and
Franchisee Offices. We have 179 branches located in 78 cities, 150
PSAs and around 110 Gold Circle Partner outlets to have a wider spread
and network across the country.
We also have presence in 6 countries outside of India through our
representative offices in USA (New York), Spain (Barcelona & Madrid),
UK (London), Japan (Tokyo), Germany (Frankfurt) and Nepal (Kathmandu),
apart from our subsidiaries in Mauritius and Branch offices in Sri
Lanka.
Share Capital Structure
The share capital structure as of 16th February, 2012 is as follows:
Authorised Capital: Rupees Rupees
Equity:
345827060 Equity Shares of Rs 1/- each 345,827,060
Preference:
(i) 114760000 Class 'A' 4.65%
Cumulative Non-Convertible Redeemable
Preference Shares of Rs 10/- each 1,147,600,000
(ii) 355294 Class 'B' 0.001%
Cumulative Convertible / Redeemable
Preference Shares of Rs 10/- each 3,552,940
(iii) 302000 Class 'C' 0.001%
Cumulative Convertible / Redeemable
Preference Shares of Rs 10/- each 3,020,000
(iv) 125000000 1% Cumulative
Non-Convertible Redeemable
Preference Shares of Rs 10/- each 1,250,000,000
2,750,000,000
Issued, Subscribed and Paid-up
Capital:
Equity:
212007362 Equity Shares of
Rs 1/- each 212,007,362
Preference:
(i) 319765 Class 'B' 0.001%
Cumulative Convertible /
Redeemable Preference Shares
of Rs 10/- each 3,197,650
(ii) 271800 Class 'C' 0.001%
Cumulative Convertible /
Redeemable Preference Shares
of Rs 10/- each 2,718,000
217,923,012
Employees Stock Option Plans (ESOPs)
With the objective of motivating and retaining key talent in the
organisation and fostering ownership, your Company has framed the
Thomas Cook Employees Stock Option Plan 2007 and pursuant to the same,
has granted stock options to its employees over the years.
The Company has also introduced the Thomas Cook Save As You Earn Scheme
2010 (SAYE Scheme 2010) with similar objectives with the approval of
the shareholders in December, 2010 by means of a Postal Ballot. SAYE
Scheme 2010 allows employees to save a part of their net pay every
month which gets deposited with a bank in a recurring deposit account
carrying fixed rate of interest. At the end of 3 years, employees have
the option to either purchase specific number of equity shares of the
Company at the predetermined Exercise Price or withdraw the Monthly
Savings Contributions alongwith Interest accrued.
During the year 2011, 2,900,000 options were approved for grant under
the Thomas Cook Employees Stock Option Plan 2007.
The Recruitment & Remuneration Committee administers and monitors the
schemes. The applicable disclosures under the Securities and Exchange
Board of India (Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999 ('the Guidelines") are mentioned
in the Annexure to the Directors' Report.
The senior managerial personnel and five other employees have received
options exceeding 5% of the value of the options issued during the year
ending December, 2011. During the year, no employee has been issued
share options equal to or exceeding 1% of the issued capital of the
Company at the time of grant.
Dividend
Your Directors recommend dividend on the Class 'B' & Class 'C'
Preference shares as per their terms, i.e. 0.001% (Rs 0.0001 per share
of Rs 10/- each) on the preference shares respectively. The Directors
are also pleased to recommend a dividend of 37.5% (Rs 0.375 per share of
Rs 1/- each) on the equity share capital.
The proposed dividend on the equity capital and preference capital
absorbs Rs 79.5 million for dividend & Rs 12 million for Dividend Tax.
The Board seeks the approval of the shareholders to the dividend
recommended on the preference and equity share capital as is
outstanding on the date of book closure/ record date.
General Reserve
Your Directors have resolved to transfer Rs 56 million to General
Reserve out of the profits of the Company. With the transfer, the total
reserves stand at Rs 3328 million as at 31st December 2011.
Directors' Responsibility Statement
The Directors would like to assure the Members that the financial
statements for the year under review conform in their entirety to the
requirements of the Companies Act, 1956 pursuant to Section 217 (2AA)
and that:
1. in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
2. the Directors have selected such accounting policies and applied
them consistently except where otherwise stated in the notes to the
accounts and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the Profit of the
Company for that period;
3. the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities. The internal auditors have conducted periodic audits to
provide reasonable assurances that established policies and procedures
of the Company have been followed. However, it must be recognised that
there are inherent limitations in weighing the assurances provided by
any system on internal controls;
4. the Directors have prepared the annual accounts on a going concern
basis.
Promoters
Thomas Cook Group plc
Thomas Cook Group plc is a leading international leisure travel group,
created by the merger of MyTravel Group plc and Thomas Cook AG in June
2007. Thomas Cook Group plc is a fully listed company on the London
Stock Exchange.
Thomas Cook (India) Limited is a part of Thomas Cook Group. It remains
as a subsidiary of TCIM Limited, an unlisted private company,
incorporated under the laws of England and Wales having its Registered
Office at Peterborough, England, U.K. and holding 55.72% of the post
ESOP Issue paid-up equity share capital of the Company. Thomas Cook UK
Limited (TCUK) apart from holding 21.39% of the post ESOP Issue paid-up
equity share capital of the Company, also holds 100% holding in TCIM
Limited. Thus, TCUK indirectly holds 77.11% of the present paid-up
equity share capital of the Company. As on date, the promoters have
pledged their entire holding of 77.11%.
Thomas Cook (India) Limited
Operations in India [including subsidiaries]
Your Company continues to be the market leader in forex during 2011,
with a range of products and services for offering. Consolidation of
businesses across the company and its subsidiaries continued through
2011.
The year 2011 too like the previous two years witnessed a volatility in
Indian Rupee (INR) Vs all the major currencies (Vs USD 24%, GBP 22% and
EURO 23%). The year 2011 saw INR at its life time low at 54.30. Global
sentiments due to the European economic crisis and the subsequent
pulling back of Foreign Institutional Investors inflows coupled with
the economic challenges on the domestic front led to the weakening of
Rupee. During this period, various forex players witnessed a surge in
the currency purchase and consequently bulk volumes increased due to
INR weakening.
Your Company took various initiatives during the year 2011 such as
network expansion, investment in marketing and visibility of products
offered, product innovations, new corporate customers etc. To delight
the customers, the Company took various initiatives on improving
customer service and training the employees on various skills. We have
moved our vision from being a sole travel insurance provider to
introducing other personal lines of insurances like Motor, Health,
Personal Accident, etc.
During the year, the insurance arm of your Company changed its
principal insurer from Tata AIG General Insurance Company Limited to
Bajaj Allianz General Insurance Company Limited (BAGIC). We are working
with BAGIC to come up with innovative and more products to suit the
requirements of the captive and other customer base.
Your Company launched an array of new products to meet all budgets
thereby meeting the growing demands of the consumers. The new products
were targeted at new destinations and new customer segments. Your
Company also expanded its distribution network by opening several new
stores and appointing new franchisees across the country. A new and
radical marketing campaign has been unveiled - 'Travel Smooth' -
emphasizing the unique positioning of your Company in its ability to
offer all travel related services under one roof. This marketing
campaign has been designed to alleviate pain points encountered by
travelers- pre, during and post trip. The Company has launched new
television commercials as part of the same.
Despite the constraints like recessionary conditions in the source
markets, the demand in the leisure inbound holiday space was at same
level compared to last year. Your Company launched new products like
PURE to meet the growing demands of the inbound luxury consumers.
Continued negotiation with suppliers helped the company to protect the
margins. Costs were kept under a tight control with several initiatives
being taken to boost productivity. Your Company had restructured the
Inbound sales & operational structures to focus on acquisition to new
business and rework positively on existing relationships with business
partners to bring sales & revenue growth.
MICE business has witnessed an overall growth with strong focus on Auto
and Paint Industries. Pharma market was tapped and overseas medical
conventions were managed on a large scale.
Visa and Passport Business, the three-year old vertical of your Company
with over 0.14 million transactions in the year is growing from
strength to strength. Apart from catering to the Travel Businesses of
your Company, it has added direct external customers for their visa,
passport and ancillary services [Attestations, Legalization, Apostille,
Translation, Notarization of documents, Foreigners Regional
Registration Office (FRRO) registration/ visa extension/ exit permit,
procures People of Indian Origin (PIO) / Overseas Citizen of India
(OCI) cards]. Additionally, your Company has tied up with attorneys to
service the long-term immigration visas/ work permits required by
corporates for their projects abroad to move their resources to these
countries.
With the increasing awareness of internet and the convenience it
offers, a large number of consumers are adopting the online medium for
research as well as purchase of travel & travel related services.
E-Business continues to be a focus area for growth for Thomas Cook and
we have invested in the past one year on building our online
capabilities. Last year, we introduced our domestic hotels & holidays
products for sale on the website, which received a good response.
Operations in Mauritius
Mauritius has been facing a reverse situation of appreciating currency
and thus impacting the foreign exchange business. With a mismatch of
having bulk of its revenue in EURO and payments inversely in USD,
Mauritius is faced with the negative consequences of a depreciating
EURO of 11.7% for the year.
Thomas Cook Mauritius has consolidated all its operations, controls
have been beefed up, processes have been strengthened to cater for the
future expansion plans of the organization. The company has embarked on
a major process restructuring and cost rationalization.
This year, targets are expected to be achieved through the operational
strategies developed despite regulatory tightening.
Operations in Sri Lanka Branch
Post the end of 30 years old conflict, Sri Lanka economy is reflecting
the recovery and a high and sustainable growth path. Peaceful domestic
environment, political stability and favourable economic conditions
have helped all key sectors to grow, including Tourism. Tourism has
been showing impressive performance and the Inflow of tourists in Sri
Lanka has been growing at a high pace.
The branch office of your Company in Sri Lanka offers foreign exchange
services from the arrival and departure lounge of the Bandaranaike
International Airport, Colombo. Your Company's business in Sri Lanka
is also growing on the lines of the industry's growth.
To capitalize on the above growth story, your Company has initiated a
process to incorporate a Wholly Owned Subsidiary in Sri Lanka to take
over the branch business. Incorporation of Wholly Owned Subsidiary, on
the one hand will help your Company in expediting the expansion of its
operations by opening branches in Colombo city and also various other
cities across the Island under the separate subsidiary, and on the
other hand it will help your Company to offer other travel product &
services in the market, mainly Inbound and Outbound tours as and when
the approvals are received from the regulatory authorities.
Awards/ Accolades and Ratings
Thomas Cook (India) Limited has been the recipient of the following
highly prestigious awards/ accolades in 2011:
- Most Trusted Tour Operator - at the Times Travel Honours Awards 2011
- Best Company Providing Foreign Exchange - at the CNBC AWAAZ Travel
Award 2011- for the third year in a row.
- Specialist Tour Operator - at the Conde Nast Traveller Readers'
Travel Awards 2011.
- Recognized as a Superbrand 2011-2012 - by the consumers for
excellence in travel services.
- Brand Trust ReportÃ, India Study, 2012, ranked Thomas Cook (India)
Limited as 'The most Trusted Brand in Services'.
CRISIL has assigned A1 and AA- rating for Thomas Cook (India) Ltd.
CRISIL has reaffirmed Thomas Cook (India) Limited with the 'CRISIL
A1 ' for the Rs 1500 million Commercial Paper and the Rs2365 million
Short term loan and Bank Guarantee programmes. It has also retained the
CRISIL AA-'rating for the Rs 2185 million cash credit and long term
programme.
A rating of A1 signifies the highest degree of safety regarding timely
payment of financial obligations; such instruments carry the lowest
credit risk. Instruments with the CRISIL AA- rating are considered to
have high degree of safety regarding timely servicing of financial
obligations, and carry very low credit risk.
Directors
In accordance with Article 131 of the Articles of Association of the
Company, Mr. H. S. Billimoria and Mr. Vinayak K. Purohit, retire by
rotation and being eligible, offer themselves for re-appointment to the
Board.
Mr. Rakshit Desai was re-appointed as the Executive Director - Foreign
Exchange of the Company for a period of one year with effect from 25th
November, 2011 and Mr. Madhavan Menon was re-appointed as the Managing
Director of the Company for a period of three years with effect from
1st March, 2012 subject to shareholders' approval and such other
approvals including that of the Central Government, and other
applicable authority(ies), if any, as may be required.
The service agreement of Mr. Vinayak K. Purohit was varied during the
period subject to shareholders' approval and such other approvals
including that of the Central Government, and other applicable
authority(ies), if any, as may be required.
The above appointments, re-appointments and variation form part of the
Notice of the Thirty-fifth Annual General Meeting and the relevant
Resolutions are recommended for your approval.
Profiles of these Directors, as required by the Listing Agreement
provisions, are given in the Corporate Governance Report forming part
of this Annual Report.
Auditors
M/s. Lovelock & Lewes, Chartered Accountants, Firm Registration
No.301056E, Auditors of the Company who retire at the forthcoming
Annual General Meeting are eligible for re-appointment and have
expressed their willingness to accept office, if re-appointed. They
have given a certificate to the effect that the re-appointment, if
made, would be within the limits prescribed under Section 224(1B) of
the Companies Act, 1956. Your Directors recommend their re-
appointment.
M/s. PricewaterhouseCoopers, Chartered Accountants, Colombo, Sri Lanka,
Firm Registration No. W4179, are recommended for re- appointment as
Branch Auditors of the Sri Lanka Branch of the Company.
Subsidiary Companies
Pursuant to the provisions of Section 212 of the Companies Act, 1956,
the Ministry of Corporate Affairs vide its circular dated February 8th,
2011, has granted general exemption from attaching the Balance Sheet,
Profit and Loss Account and other documents of the subsidiary companies
with the Balance Sheet of the Company. Accordingly, the said documents
are not being attached with the Balance Sheet of the Company. A
statement containing brief financial details of the Company's
Subsidiaries is contained elsewhere in the Annual Report. The annual
accounts of these subsidiaries and the related detailed information
will be made available to any member of the Company/ its subsidiaries
seeking such information at any point of time and are also available
for inspection by any member of the Company/its subsidiaries at the
registered office of the Company and that of the respective subsidiary
companies. The Company shall furnish a copy of details of annual
accounts of subsidiaries to any member on demand.
Further, TC Visa Services (India) Limited, a step-down subsidiary of
the Company, incorporated on 30th August, 2011, is not considered for
the purposes of consolidation nor are the prescribed particulars
disclosed in the statement aforesaid due to the fact that the said
company is yet to hold its statutory meeting and conclude its first
financial year.
Particulars regarding conservation of energy, technology absorption and
foreign exchange earnings and expenditure
Your Company being in the Tourism hospitality industry, its activities
do not involve in any expenditure on Technology and Research and
Development and therefore, the other particulars in the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rules, 1988 are not required to be submitted.
During the year, the foreign exchange earnings (on a standalone basis)
amounted to Rs 610 million, whereas, the Company has incurred Rs 104
million as expenditure in foreign currencies towards interest, bank
charges, licence fees, professional fees, as well as travelling for
promotional activities, subscriptions, etc., as disclosed in Schedule Q
Note 2(h) and 2 (f) in the Notes to the accounts.
During the year, Travel Corporation (India) Limited, a subsidiary, also
earned Foreign Exchange amounting to Rs 1120 million and incurred Rs 44.2
million towards salary, legal & professional fees, travelling, etc.
including expenditure incurred by foreign branches.
Fixed Deposits
Your Company has not accepted deposits from the Public within the
meaning of Section 58A of the Companies Act, 1956 and as such no amount
principal or interest was outstanding on the date of the Balance Sheet.
Listing of Shares
Your Company is listed on two Stock Exchanges in India viz. BSE
Limited, Mumbai and National Stock Exchange of India Limited, Mumbai.
The Company has paid the Listing Fees to both the Stock Exchanges for
the Financial Year 2011-2012.
Employees
Relations with the employees continued to be cordial throughout the
year. Your Directors place on record their appreciation of the efforts,
dedication, commendable teamwork and exemplary contribution of the
employees in the various initiatives of the Company and contributing to
the performance of the Company during the year under review.
Special mention needs to be made of the co-operation received from the
Employees' Unions of Thomas Cook (India) Limited and Travel
Corporation (India) Limited.
Information pursuant to Section 217(2A) of the Companies Act, 1956
The particulars required under Section 217(2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
as amended, forms part of this Report and have been annexed herewith.
Corporate Governance
Your Company continues to be committed to good corporate governance
aligned with the best corporate practices. It has also complied with
various standards set out by Securities and Exchange Board of India and
the Stock Exchanges where it is listed. The Management Discussion and
Analysis Report forms part of this Annual Report.
For the year ended 31st December, 2011, your Company has complied with
the requirements of Clause 49 of the Listing Agreement and other
applicable rules and regulations with respect to Corporate Governance.
A certificate from a Practising Company Secretary obtained by the
Company regarding such compliance of conditions of Corporate Governance
is attached to this report.
Acknowledgments
Your Directors thank all the Shareholders, Customers, Vendors for their
continued support throughout the year. We also thank Reserve Bank of
India and other Banks, Ministry of Tourism, Financial Institutions,
Government of India, State Governments, and other Government agencies
for the support extended by them and also look forward to their
continued support in future.
Your Directors also wish to place on record their appreciation of the
contribution made by the Company's employees at all levels but for
whose hard work, solidarity and support your Company's consistent
growth would not have been even possible.
FOR AND ON BEHALF OF THE BOARD
MADHAVAN MENON VINAYAK K. PUROHIT
Managing Director Executive Director - Finance
Mumbai,
Dated: 16th February, 2012
Dec 31, 2010
The Directors have pleasure in presenting the Thirty-fourth Annual
Report, together with the Balance Sheet and Profit and Loss Account for
the year ended 31st December, 2010.
Rupees in Million
Year ended Year ended
31st December, 2010 31st December, 2009
Revenues 2792 2247
Profit before Taxation and
Exceptional Items 532 341
Exceptional Items 100 --
Profit after Exceptional item and
before Tax 632 341
Provision for Taxation 209 114
Provision for Deferred Taxation 8 4
Provision for Fringe Benefit Tax - 1
Profit after Taxation 415 222
Transferred from Reserve U/sec.
80 HHD of the Income Tax Act, 1961 15 15
Transferred to General Reserve 42 22
Proposed Dividend * 79 80
EPS (Basic) after exceptional items 1.96 1.06
EPS (Diluted) after exceptional
items 1.91 1.03
* Includes preference share dividend Operations and Results
The year 2010 saw a revival in the general economy as well as the
tourism industry. A strong GDP growth and the rising stock indices,
coupled with positive outlook and the resurgence of suppressed demand,
helped boost travel and tourism sector in 2010.
The demand for leisure holidays increased due to receding recessionary
pressures, economic revival and return of confidence in Indian
consumers. Despite the challenges faced last year in terms of a slow
economy, sluggish demand and security concerns, the country was
fighting back and tourism developments were taking place. Although
there could be some short- to medium-term setbacks, the long- term
outlook remains positive.
With Indian economy growing at around 8% per annum and rise in
disposable incomes of Indians, an increasing number of people are going
on holiday trips within the country and abroad resulting in the tourism
industry growing wings. 2010 saw a revival in foreign tourist arrivals
after the slump last year on account of the slowdown with a growth rate
of 8% as compared to a de-growth of 2.2 % in 2009.
The year 2010 witnessed rupee appreciation against major currencies.
The buoyant market conditions helped financial services of the Company
grow by 8% in volumes over 2009 despite the fact that rupee
appreciation created a challenging trading environment for the
wholesale forex volumes.
Despite the constraints faced such as the volcanic eruption in Iceland
and consequential ash cloud formation over UK & Europe, and heavy
snowfall in the USA and UK, which disrupted air traffic, your Company
overcame the difficult situation to report an increase in revenues by Rs.
539 million to Rs. 2792 million. Profit before Taxation and exceptional
items increased to Rs. 532 million from Rs. 341 million.
Your Company recorded turnover of Rs. 2792 million and profit before tax
and exceptional item of Rs. 532 million with profit after tax being Rs. 415
million for the year ended 31st December, 2010. The basic earning per
share of the Company is Rs. 1.96.
Thomas Cook Presence
As of December 2010 end, Thomas Cook (India) Limited, alongwith its
subsidiaries, continues to be the largest integrated travel group in
India with over 180 locations by way of its own branches, and
additional presence by way of Preferred Sales Agents (PSAs) and
Franchisee Offices. We have 180 branches located in 72 cities, 184
PSAs in India, 14 in overseas market and around 72 Franchisee Offices
across India to have a wider spread and network across the country.
We also have presence in 6 countries outside of India through our
representative offices in USA (New York), Spain (Barcelona and Madrid),
UK (London), Japan (Tokyo), Germany (Frankfurt) and Nepal (Kathmandu),
apart from our subsidiaries in Mauritius and Branch offices in Sri
Lanka.
Employees Stock Option Plans (ESOPs)
With the objective of motivating and retaining key talent in the
organisation and fostering ownership, your Company has framed the
Thomas Cook Employees Stock Option Plan 2007 and pursuant to the same,
has granted stock options to its employees over the years.
The Company has also introduced the Thomas Cook Save As You Earn Scheme
2010 (SAYE Scheme 2010) with similar objectives with the approval of
the shareholders in December 2010 by means of a Postal Ballot. SAYE
Scheme 2010 allows employees to save a part of their net pay every
month which gets deposited with a bank in a recurring deposit account
carrying fixed rate of interest. At the end of 3 years, employees have
the option to either purchase specific number of equity shares of the
Company at the predetermined Exercise Price or withdraw the Monthly
Savings Contributions alongwith Interest accrued.
The Recruitment and Remuneration Committee administers and monitors the
schemes. The applicable disclosures under the Securities and Exchange
Board of India (Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999 ("the Guidelines") are mentioned in
the Annexure to the Directors Report.
Except for senior managerial personnel and two other employees, none of
the other employees have received options exceeding 5% of the value of
the options issued during the year ending December 2010. Likewise,
during the year, no employee has been granted stock options equal to or
exceeding 1% of the issued capital of the Company at the time of grant.
Dividend
Your Directors recommend dividend on the Class B and Class C
Preference shares as per their terms, i.e. 0.001% (Rs. 0.0001 per share
of Rs. 10/- each) on the preference shares respectively. The Directors
are also pleased to recommend a dividend of 37.5% (Rs. 0.375 per share of
Rs. 1/- each) on the equity share capital.
The proposed dividend on the equity capital and preference capital
absorbs Rs. 79 million for dividend and Rs. 13 million for Dividend Tax.
The Board seeks the approval of the shareholders to the dividend
recommended on the preference and equity share capital as is
outstanding on the date of book closure/ record date.
General Reserve
Your Directors have resolved to transfer Rs. 42 million to General
Reserve out of the profits of the Company. With the transfer, the total
reserves stand at Rs. 2846 million as at 31st December, 2010.
Directors Responsibility Statement
The Directors would like to assure the Members that the financial
statements for the year under review conform in their entirety to the
requirements of the Companies Act, 1956 pursuant to Section 217 (2AA)
and that:
1.In the preparation of the annual accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures;
2. the Directors have selected such accounting policies and applied
them consistently except where otherwise stated in the notes to the
accounts and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the Profit of the
Company for that period;
3. the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities. The internal auditors have conducted periodic audits
to provide reasonable assurances that established policies and
procedures of the Company have been followed. However, it must be
recognised that there are inherent limitations in weighing the
assurances provided by any system on internal controls;
4. the Directors have prepared the annual accounts on a going concern
basis.
Promoters
Thomas Cook Group pic
Thomas Cook Group pic is a leading international leisure travel group,
created by the merger of MyTravel Group pic and Thomas Cook AG in June
2007. Thomas Cook Group pic is a fully listed company on the London
Stock Exchange.
Thomas Cook (India) Limited is a part of Thomas Cook Group. It remains
as a subsidiary of TCIM Limited, an unlisted private company,
incorporated under the laws of England and Wales having its Registered
Office at Peterborough, England, U.K. and holding 55.77% of the post
ESOP Issue paid-up equity share capital of the Company. Thomas Cook UK
Limited (TCUK) apart from holding 21.41% of the post ESOP Issue paid-up
equity share capital of the Company, also holds 100% holding in TCIM
Limited. Thus, TCUK indirectly holds 77.18% of the present paid-up
equity share capital of the Company.
Promoter Group
Pursuant to intimation from the promoters, the name of the Promoters
and entities comprising the group are disclosed hereinbelow for the
purpose of Regulation 3(1 )(e)(i) of the Securities and Exchange Board
of India (Substantial Acquisition of Shares and Takeovers) Regulations,
1997, and they include the following:
Group
Airtours the Holidaymakers Limited
Thomas Cook Group UK Limited (erstwhile Blue Sea Investments Limited)
Blue Sea Overseas Investments Limited
My Travel Group pic
My Travel UK Limited
Sandbrook Overseas Investments Limited
Sandbrook UK Investments Limited
TCIM Limited
Thomas Cook Continental Holdings Limited
Thomas Cook Group pic
Thomas Cook Investments (1) Limited
Thomas Cook Investments (2) Limited
Thomas Cook Overseas Limited
Thomas Cook Scheduled Tour Operations Limited
Thomas Cook Tour Operations Limited
Thomas Cook UK Limited
Thomas Cook (India) Limited
Operations in India [including subsidiaries]
The businesses have shown a recovery due to economic revival and return
of confidence in Indian consumers.
During the year, new products targeted at new destinations and new
customer segments were launched. The Company launched television
commercials and was one of the sponsors of "Mumbai Indians", a cricket
team which is part of the Indian Premier League. During the year, the
Company also launched "Readymade Holidays", a holiday package box
available through any of our network and channel partners. These are
pre-packaged holidays for both domestic and international selected
destinations. The Company expanded its Gold Circle Partners (GCPs)
across India. The Company continued to build on the success of the
media plan launched under the new "Holidaywallas" campaign in 2009.
The improved demand for foreign exchange coupled with the initiatives
that were taken by your Company such as new branches opened, new
counters at Delhi and Mumbai airport, post office tie-up, etc. enabled
your Company to improve the retail volumes over 2009. With over 1.2
million transactions handled in 2010, your Company is one of the
largest exporters in the world for bank notes. It handles majority of
Indias foreign currency bank notes. Your Company is in the process of
tie-up with various principal agents worldwide for the remittance
business. In this direction, it has signed Sub Agency agreement with
UAE Exchange, Second largest inward remittance service in India and
largest service provider in the Gulf Markets.
The new - look of the Thomas Cook portal was also launched during the
year. All Thomas Cook products are available through the portal with
more user-friendly applications. Your Company is focusing on building
the product range on the portal to capitalize on the growing
e-business.
Operations in Mauritius
Mauritius has been facing a situation of appreciating currency which is
impacting the foreign exchange business volumes. Inflation rate being
at 2%, the Mauritian economy has seen major consequences of the global
financial crisis, especially in its tourism sector and export oriented
industries. With the support of Government funded stimulus packages,
the loss of jobs effect has been contained and all indicators are
pointing towards a further difficult year ahead.
In spite of the exchange rate impact to an estimated 18%, the customer
base has increased and the company has gained further improved
visibility in the market and has become a reference. With Mauritius
seen as a major tourist destination and the Governments inclination to
diversify its tourism base from a traditionally European base to
include the Asian markets, Thomas Cook Mauritius will be focussing on
seizing this opportunity and enhance the contribution from the holidays
and leisure segment.
In Thomas Cook (Mauritius) Operations Company Limited (TCMOCL), a
step-down subsidiary of the Company, a new integrated software
Maraekatwas identified for implementation for foreign exchange and
accounting transactions. The usage of the new system helped identify
certain Accounting and Reconciliation Issues. The management has
resolved and corrected these issues in the books after an independent
enquiry and investigation.
Operations in Sri Lanka Branch
The Sri Lanka branch of your Company offers foreign exchange services
from the arrival and departure lounge of the Bandaranaike International
Airport, Colombo, Sri Lanka and also from a branch office in Colombo
city.
The focus of your Company is to expand its operations by opening more
branches in Colombo city and also various other cities across the
Island as and when the approvals are received from the regulatory
authorities. Your Company is also seeking to enhance its scope of
license to enable it to play a more constructive role in the financial
system of the country.
Post the end of insurgency in Sri Lanka, the inflow of tourists has
started to increase. With a safe and stable environment, conducive to
travel, the outlook seems positive for the countrys economy and your
Company would look to capitalize on it.
Accolades and Awards
Thomas Cook (India) Limited has been the recipient of the following
highly prestigious awards/ accolades in 2010:
CNBC AWAAZ - Best FOREX Company in India for the second year in a row
Indias Most Preferred Foreign Exchange Company by Indian Hospitality
Excellence Awards
"Special Commendation" for the Golden Peacock National Training Award
for the year 2010
Directors
In accordance with Article 131 of the Articles of Association of the
Company, Mr. M. K. Sharma, Mr. Ramesh Savoor and Mr. Krishnan
Ramachandran retire by rotation and being eligible, offer themselves
for re-appointment to the Board.
Mr. Rakshit Desai was re-appointed as the Executive Director - Travel
Services of the Company for a period of one year w.e.f. 25th November,
2010 subject to the shareholders approval.
The above appointments, re-appointments and variations form part of the
Notice of the Thirty-fourth Annual General Meeting and the relevant
Resolutions are recommended for your approval.
Profiles of these Directors, as required by the Listing Agreement
provisions, are given in the Corporate Governance Report forming part
of this Annual Report.
During the period, Mr. Dilip De and Mr. Heinrich- Ludger Heuberg
resigned from the Company. The Board placed on record its sincere
appreciation for the contribution made by these Directors during their
tenure as Directors of the Company.
With respect to the approvals sought from the Central Government in
respect of the appointment and remuneration of Mr. Rakshit Desai for
2008 and 2009 and in respect of payment of managerial remuneration to
Mr. Madhavan Menon and Mr. Vinayak K. Purohit for 2009, the same have
since been received.
Auditors
M/s. Lovelock & Lewes, Chartered Accountants, Firm Registration No.
301056E,Auditorsof the Company who retire atthe forthcoming Annual
General Meeting are eligible for re-appointment and have expressed
their willingness to accept office, if re-appointed. They have given a
certificate to the effect that the re-appointment, if made, would be
within the limits prescribed under Section 224(1 B) of the Companies
Act, 1956. Your Directors recommend their re-appointment.
M/s. PricewaterhouseCoopers, Chartered Accountants, Colombo, Sri Lanka,
Firm Registration No. W4179, are recommended for re-appointment as
Branch Auditors of the Sri Lanka Branch of the Company.
Subsidiary Companies
The Audited Statement of Accounts along with the Directors Report of
Travel Corporation (India) Limited, Thomas Cook Insurance Services
(India) Limited, Thomas Cook Tours Limited and Indian Horizon Travel &
Tours Limited for the year ended 31st December, 2010 and the
Consolidated accounts of Thomas Cook (Mauritius) Holding Company
Limited for the year ended 30th September, 2010 are separately attached
as required under the provisions of Section 212 of the Companies Act,
1956. The Mauritian subsidiaries have changed their accounting year to
end on 30th September every year. Accordingly, the Consolidated
Accounts of Thomas Cook (Mauritius) Holding Company Limited for the
year ended 30th September, 2010 are separately attached.
Particulars regarding conservation of energy, technology absorption and
foreign exchange earnings and expenditure
Your Company being in the Tourism and hospitality industry, its
activities do not involve in any expenditure on Technology and Research
and Development and therefore, the other particulars in the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rules, 1988 are not required to be submitted.
However, due to the voluntary measures adopted to conserve energy
through an energy audit and consequently implementing its
recommendations, your Company was able to make a saving in its energy /
electricity consumption of 66210 units (approx. Rs. 1.2 million) at the
Head Office and 98964 units (approx. Rs. 1.6 million) at its Chembur
office.
During the year, the foreign exchange earnings amounted to Rs. 457
million, whereas, the Company has incurred Rs. 73 million as expenditure
in foreign currencies towards interest, bank charges, licence fees,
professional fees, as well as travelling for promotional activities,
subscriptions, etc., as disclosed in Schedule Q Note 2(h) and 2 (f) in
the Notes to the accounts.
Fixed Deposits
Your Company has not accepted deposits from the Public within the
meaning of Section 58A of the Companies Act, 1956 and as such no amount
principal or interest was outstanding on the date of the Balance Sheet.
Listing of Shares
Your Company is listed on two Stock Exchanges in India viz. Bombay
Stock Exchange Limited, Mumbai and National Stock Exchange of India
Limited, Mumbai. The Company has paid the Listing Fees to both the
Stock Exchanges for the period 1st April, 2010 to 31st March, 2011.
Employees
Relations with the employees continued to be cordial throughout the
year. Your Directors place on record their appreciation of the efforts,
dedication, commendable teamwork and exemplary contribution of the
employees in the various initiatives of the Company and contributing to
the performance of the Company during the year under review.
Information pursuant to Section 217(2A) of the Companies Act, 1956
The particulars required under Section 217(2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
forms part of this Report and have been annexed herewith.
Corporate Governance
Your Company continues to be committed to good corporate governance
aligned with the best corporate practices. It has also complied with
various standards set out by Securities and Exchange Board of India and
the Stock Exchanges where it is1 listed. The Management Discussion and
Analysis Report forms part of this Annual Report.
For the year ended 31st December, 2010, your Company has complied with
the requirements of Clause 49 of the Listing Agreement and other
applicable rules and regulations with respect to Corporate Governance.
A certificate from the Auditors of the Company regarding such
compliance of conditions of Corporate Governance is attached to this
report.
Acknowledgments
Your Directors thank all the Shareholders, Customers, Vendors for their
continued support throughout the year. We also thank Reserve Bank of
India and other Banks, Ministry of Tourism, Financial Institutions,
Government of India, State Governments and other Government agencies
for the support extended by them and also look forward to their
continued support in future.
Your Directors also wish to place on record their appreciation of the
contribution made by the Companys employees at all levels but for
whose hard work, solidarity and support your Companys consistent
growth would not have been possible.
FOR AND ON BEHALF OF THE BOARD
MADHAVAN MENON VINAYAK K. PUROHIT
Managing Director Executive Director - Finance
Mumbai,
Dated: 17th February, 2011
Dec 31, 2009
The Directors have pleasure in presenting the Thirty-third Annual
Report, together with the Balance Sheet and Profit and Loss Account for
the year ended 31st December 2009.
Rupees in Million
Year ended Year ended
31st December 2009 31st December 2008
Revenues 2247 2588
Profit before Taxation and
exceptional items 341 536
Provision for Taxation 114 187
Provision for Deferred Taxation 4 (1)
Provision for Fringe Benefit Tax 1 16
Profit after Taxation and before
Exceptional item 222 334
Exceptional item, net of taxation - 32
Profit after Taxation 222 302
Transferred from Reserve U/sec. 80
HHD of the Income Tax Act, 1961 15 18
Transferred to General Reserve 22 34
Proposed Dividend * 80 93
EPS (Basic) after exceptional items 1.06 1.76
EPS (Diluted) after exceptional items 1.03 1.71
* Includes preference share dividend
Operations & Results
The global and local markets continued to witness an economic slowdown
for most of 2009. Corporates and individuals alike, remained cautious
to spend on travel due to the downturn. When the confidence level in
the economy went up during the second half of the year, higher Foreign
Institution Inflows made the Rupee stronger. Also lot of volatility was
witnessed in Indian Rupee against the major currencies.
For the first time in seven years, the foreign tourist arrivals into
India fell by 3% in 2009 distorting the six-year growth rally.
The first-half 2009 saw a steady decline in bookings in the travel &
tourism industry, particularly due to the November 26,2008 terror
attack in Mumbai.
Consequently, the revenues reduced by Rs. 341 million to Rs. 2247
million. Costs were saved by Rs. 146 million. Profit before Taxation
and exceptional items reduced by Rs. 195 million to Rs. 341 million.
Your Company recorded turnover of Rs. 2247 million and profits before
tax and exceptional item of Rs. 341 million with profit after tax being
Rs. 222 million for the year ended 31st December 2009. The basic
earning per share of the Company is Rs. 1.06.
Utilisation of Rights Issue Proceeds:
During the year ended 31st December 2009, the Company allotted
50,650,699 fully paid up equity shares of Re. 1/- each towards Rights
Issue for cash at a price of Rs. 35.50 (including a share premium of
Rs. 34.50) per equity share in the ratio of 35 fully paid up equity
shares for every 100 fully paid up equity shares held by the existing
shareholders on the record date 27th December 2008. Consequently, the
issued and paid up equity share capital increased to 211,446,569
shares. The Right Issue Proceeds Utilisation is as below: -
Particulars Rs. (in mn) Rs. (in mn)
Inflow: Rights Issue
proceeds 1,798.1
Outflow: Preference Share
Capital redemption (including
redemption premium
dividend and (1,167.6)
dividend distribution tax)
FCNR Loan repayment (423.8)
Repayment of commercial
paper/short term
borrowings (183.7)
Expenses pertaining to
Rights Issue (23.0) (1,798.1)
Lower borrowings, coupled with reduced interest rates negotiations
helped your Company in achieving a reduction in the Interest cost from
Rs. 299 million in 2008 to Rs. 149 million in 2009 and consequently,
the Company was able to make savings of Rs. 150 million.
Thomas Cook Presence:
As of December 2009 end, Thomas Cook (India) Limited, alongwith its
subsidiaries, continues to be the largest integrated travel group in
India with over 180 locations by way of its own branches, and
additional presence by way of General Sales Agents (GSAs), Preferred
Sales Agents (PSAs) and Franchisee Offices. We have 180 branches
located in 72 cities, over 190 GSAs/ PSAs and around 32 Franchisee
Offices across India to have a wider spread and network across the
country.
We also have presence in 5 countries outside of India through our
representative offices in USA (New York), Spain (Barcelona & Madrid),
UK (London), Japan (Tokyo) and Germany (Frankfurt), apart from our
subsidiaries in Mauritius and Branch offices in Sri Lanka.
Share Capital Structure:
The share capital structure as of 17th March, 2010 is as follows:
Authorised Capital: Rs. Rs.
Equity:
34,58,27,060 Equity Shares of
Re. 1/- each 345,827,060
Preference:
(i) 11,47,60,000 Class A,
4.65% Cumulative
Non-Convertible Redeemable Preference
Shares of Rs. 10/- each 1,147,600,000
(ii) 3,55,294 Class B 0.001%
Cumulative Convertible / Redeemable
Preference Shares of Rs. 10/- each 3,552,940
(iii) 3,02,000 Class C 0.001%
Cumulative Convertible / Redeemable
Preference Shares of Rs. 10/-each 3,020,000
(iv) 12,50,00,000 1% Cumulative
Non-Convertible Redeemable Preference
Shares of Rs. 10/-each 1,250,000,000
2,750,000.000
Issued, Subscribed and Paid-up Capital:
Equity:
211,546,569 Equity Shares of
Re. 1/- each 211,546,569
Preference:
(i> 3,19,765 Class B 0.001%
Cumulative
Convertible / Redeemable Preference
Shares of Rs. 10/-each 3,197,650
(ii) 2,71,800 Class C 0.001% Cumulative
Convertible / Redeemable Preference
Shares of Rs. 10/- each 2,718,000
217,462,219
Employees Stock Option Scheme (ESOP)
With the objective of motivating and retaining key talent in the
organisation and fostering ownership, your Company has framed the
Thomas Cook Employees Stock Option Plan 2007 and pursuant to the same,
has granted stock options to its employees over the years.
The Recruitment & Remuneration Committee administers and monitors the
scheme. The applicable disclosures under the Securities and Exchange
Board of India (Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999 (the Guidelines") are mentioned in
the Annexure to the Directors Report.
Except for senior managerial personnel and one other person, none of
the employees have received options exceeding 5% of the value of the
options issued during the year ending December 2009. Likewise, during
the year, no employee has been issued share options equal to or
exceeding 1% of the issued capital of the Company at the time of grant.
The Recruitment & Remuneration Committee has, subject to the approval
of the shareholders at the present general meeting, varied the ESOP
Scheme 2007 to the effect that all future grantees shall be granted
options at a discount of 10% of the Market Price instead of a 5%
discount as provided for earlier. This is in line with changes in the
market conditions and towards retaining Key Talent by having a more
attractive ESOP Plan. This price shall apply only to fresh grants being
made under the scheme.
Dividend
Your Directors recommend dividend on the Class B & Class C
Preference shares as per their terms as also seek the ratification of
the dividend paid to holders of 10,50,00,000 1% Cumulative
Non-Convertible Redeemable Preference Shares on redemption. The
Directors are also pleased to recommend a dividend of 37.5% on the
equity share capital.
The proposed dividend on the equity capital and preference capital
absorbs Rs. 80 million for dividend & Rs. 14 million for Dividend Tax.
General Reserve
Your Directors have resolved to transfer Rs. 22 million to General
Reserve out of the profits of the Company. With the transfer, the total
reserves stand at Rs. 2508 million as at 31st December 2009.
Directors Responsibility Statement:
The Directors would like to assure the Members that the financial
statements for the year under review conform in their entirety to the
requirements of the Companies Act, 1956 pursuant to Section 217 (2AA)
and that
1. the Annual Accounts have been prepared in conformity with the
applicable Accounting Standards;
2. the Directors have selected such accounting policies and applied
them consistently except where otherwise stated in the notes to the
accounts and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the Profit of the
Company for that period;
3. the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities. The internal auditors have conducted periodic audits
to provide reasonable assurances that established policies and
procedures of the Company have been followed. However, it must be
recognised that there are inherent limitations in weighing the
assurances provided by any system on internal controls;
4. the Directors have prepared the annual accounts on a going concern
basis.
Promoters
Thomas Cook Group pic
Thomas Cook Group pic is a leading international leisure travel group,
created by the merger of MyTravel Group pic and Thomas Cook AG in June
2007. Thomas Cook Group pic is a fully listed company on the London
Stock Exchange.
Thomas Cook (India) Limited is a part of Thomas Cook Group. It remains
as a subsidiary of TCIM Limited, an unlisted private company,
incorporated under the laws of England and Wales having its Registered
Office at Peterborough, England, U.K. and holding 55.84% of the post
ESOP Issue paid-up equity share capital of the Company. Thomas Cook UK
Limited (TCUK) apart from holding 21.44% of the post ESOP Issue paid-up
equity share capital of the Company, also holds 100% holding in TCIM
Limited. Thus, TCUK indirectly holds 77.27% of the present paid-up
equity share capital of the Company.
Group
Pursuant to intimation from the promoters, the name of the Promoters
and entities comprising the group are disclosed hereinbelow for the
purpose of Regulation 3(1)(e)(i) of the Securities and Exchange Board
of India (Substantial Acquisition of Shares and Takeovers) Regulations,
1997, and they include the following:
Group
Airtoursthe Holidaymakers Limited
Thomas Cook Group UK Limited (erstwhile Blue Sea Investments Limited)
Blue Sea Overseas Investments Limited
MyTravel Group pic
MyTravel UK Limited
Sandbrook Overseas Investments Limited
Sandbrook UK Investments Limited
TCIM Ltd.
Thomas Cook Continental Holdings Limited
Thomas Cook Group pic
Thomas Cook Investments (1) Limited
Thomas Cook Investments (2) Limited
Thomas Cook Overseas Limited
Thomas Cook Scheduled Tour Operations Limited
Thomas Cook Tour Operations Limited
Thomas Cook UK Limited
Thomas Cook (India) Limited
Operations in India [including Travel Corporation (India) Limited]
Consolidation of businesses across the Company and its subsidiaries
continued through 2009.
During the year, new initiatives were taken like the launch of a
complete Print Holidays campaign under the new name Holidaywallas;
the venturing into a new segment - the luxury segment with our new
luxury brand Indulgence; launch and/ or continuation of products like
Honeymoon Holidays, Holyland tours, Rock on series; launch of new
luxury train itinerary, The Indian Maharaja - Deccan Odyssey through
our subsidiary Travel Corporation (India) Limited. The Company also
started a new marketing campaign for Leisure Travel with focus on new
products and change in media mix. A corporate booking tool - the
Corporate Travel Module (CTM) was launched and the Company also
undertook a back end integration / consolidation exercise through the
Service Excellence Centre.
The E-Businesses also launched a gamut of new products & services in
2009 catering to various segments of the customers based on their
requirements and travel trends for air and rail ticketing, hotel
bookings and branded international holidays; customisable self-booking
tool for Corporates, modules for the Visa & Passport Services Team.
Operations in Mauritius
The Mauritian subsidiaries have changed their accounting year to a
period of nine months ending 30th September, 2009. During 2009, Thomas
Cook Mauritius Operations Company Limited, the foreign exchange arm of
the Mauritius Holding entity has seen the implementation of a new
front-end business application for its Foreign Exchange business which
is under stabilisation. With the increased network of 20 branches, the
operations company has exceeded its budgets and last years numbers.
New business has been signed with parties in the market for increasing
the variety of products offered from the branches and the company is
further enjoying increased visibility.
Operations in Sri Lanka Branch
The Sri Lanka branch of your Company offers foreign exchange services
from the arrival and departure lounge of the Bandaranaike International
Airport, Colombo, Sri Lanka and has a staff strength of twenty
personnel.
The focus of your Company is to expand its operations beyond the
airport by opening branches in various cities as and when the approvals
are received from the regulatory authorities. Your Company is also
seeking to enhance its scope of license to enable it to play a more
constructive role in the financial system of the country.
Post the end of insurgency in Sri Lanka, the inflow of tourists has
started to increase. Now with a stable Government in place after the
recent elections, the outlook seems positive for the countrys economy
and your Company would look to capitalize on it.
Accolades and Awards:
Thomas Cook (India) Limited has been the recipient of the following
highly prestigious awards in 2009:
CNBC AWAAZ - Best FOREX Company in India
CNBC AWAAZ - Best Tour Operator for the second time in a row
Directors
In accordance with Article 131 of the Articles of Association of the
Company, Mr. H. S. Billimoria, Mr. A. V. Rajwade and Mr. Rakshit Desai
retire by rotation and being eligible, offer themselves for
re-appointment to the Board.
Mr. Ramesh Savoor, Mr. Mahendra Kumar Sharma and Mr. Krishnan
Ramachandran were appointed as Additional Directors with effect from
29th May 2009. As Additional Directors, Mr. Savoor, Mr. Sharma and Mr.
Ramachandran hold office upto the date of the ensuing Annual General
Meeting of the Company.
Mr. Vinayak K. Purohit was re-appointed as the Executive Director -
Finance of the Company for a period of three years w.e.f. 14th May,
2010.
The Service Agreements of Mr. Madhavan Menon, Managing Director and Mr.
Rakshit Desai, Executive Director - Travel Services were varied during
the period.
The above appointments, re-appointments and variations form part of the
Notice of the Thirty-third Annual General Meeting and the relevant
Resolutions are recommended for your approval.
Profiles of these Directors, as required by the Listing Agreement
provisions, are given in the Notice/ Corporate Governance Report
forming part of this Annual Report.
During the period, Mr. Udayan Bose, Mr. Manny Fontenla-Novoa,
Dr.Juergen Bueser, Mr. Roland Zeh, Dr. Angus Porter and Mr. Dilip De
resigned from the Company. The Board placed on record its sincere
appreciation for the contribution made by the Directors during their
tenure as Directors of the Company.
Auditors
M/s. Lovelock & Lewes, Chartered Accountants, Auditors of the Company
who retire at the forthcoming Annual General Meeting are eligible for
re-appointment and have expressed their willingness to accept office,
if re-appointed. They have given a certificate to the effect that the
re-appointment, if made, would be within the limits prescribed under
Section 224(1 B) of the Companies Act, 1956. Your Directors recommend
their re- appointment.
M/s. PricewaterhouseCoopers, Chartered Accountants, Colombo, Sri Lanka,
are recommended for re-appointment as Branch Auditors of the Sri Lanka
Branch of the Company.
Auditors Report
Regarding Sub-Clause (i) of Clause (h) of the Auditors Report, an
application to the Central Government in respect of the appointment and
remuneration of Mr. Rakshit Desai, Executive Director-Travel Services,
is already made and for which approval is pending.
Regarding Sub-Clause (ii) of Clause (h) of the Auditors Report,
relevant applications to the Central Government in respect of payment
of managerial remuneration to Mr. Madhavan Menon and Mr. Vinayak K.
Purohit have already been made and for which approvals are pending.
The Management has noted the comments on Corporate Travel Module (CTM)
implementation and it is committed to resolving the issues at the
earliest.
Subsidiary Companies
The Audited Statement of Accounts along with the Directors Report of
Travel Corporation (India) Limited, Thomas Cook Insurance Services
(India) Limited, Thomas Cook Tours Limited, Indian Horizon Travel &
Tours Limited and the Consolidated accounts of Thomas Cook (Mauritius)
Holding Company Limited for the year ended 31st December, 2009 are
separately attached as required under the provisions of Section 212 of
the Companies Act, 1956. The Mauritian subsidiaries have changed their
accounting year to a period of nine months ending 30th September, 2009.
Accordingly, the Consolidated Accounts of Thomas Cook (Mauritius)
Holding Company Limited for the nine months ended 30th September, 2009
are separately attached.
Particulars regarding conservation of energy, technology absorption and
foreign exchange earnings and expenditure
Your Company being in the Tourism hospitality industry, its activities
do not involve in any expenditure on Technology and Research and
Development and therefore, the other particulars in the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rules, 1988 are not required to be submitted.
However, due to the voluntary measures adopted to conserve energy
through an energy audit and consequently implementing its
recommendation, your Company was able to make a savings in its energy /
electricity consumption of 106950 units at the Head Office and 31487
units at its Chembur office.
During the year, the foreign exchange earnings amounted to Rs. 580
million, whereas, the Company has incurred Rs. 65 million as
expenditure in foreign currencies towards interest, bank charges,
licence fees, professional fees, as well as travelling for promotional
activities, subscriptions, etc., as disclosed in Schedule Q Note 2(h)
and 2 (f) in the Notes to the accounts.
Fixed Deposits
Your Company has not accepted deposits from the Public within the
meaning of Section 58A of the Companies Act, 1956 and as such no amount
principal or interest was outstanding on the date of the Balance Sheet.
Listing of Shares
Your Company is listed on two Stock Exchanges in India viz. Bombay
Stock Exchange Limited, Mumbai and National Stock Exchange of India
Limited, Mumbai. The Company has paid the Listing Fees to both the
Stock Exchanges for the Financial Year 2009-2010.
Employees
Relations with the employees continued to be cordial throughout the
year. Your Directors place on record their appreciation of the efforts,
dedication, commendable teamwork and exemplary contribution of the
employees in the various initiatives of the Company and contributing to
the performance of the Company during the year under review.
Information pursuant to Section 217(2A) of the Companies Act, 1956
The particulars required under Section 217(2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
forms part of this Report and have been annexed herewith.
Corporate Governance
Your Company continues to be committed to good corporate governance
aligned with the best corporate practices. It has also complied with
various standards set out by SEBI and the Stock Exchanges where it is
listed. The Management Discussion and Analysis Report forms part of
this Annual Report.
For the year ended 31st December, 2009, your Company has complied with
the requirements of Clause 49 of the Listing Agreement and other
applicable rules and regulations with respect to Corporate Governance.
A certificate from the Auditors of the Company regarding such
compliance of conditions of Corporate Governance is attached to this
report. The Company is yet to consider the adoption of "Corporate
Governance - Voluntary Guidelines, 2009" recommended by the Ministry of
Corporate Affairs and released at the India Corporate Week during 14th
to 21st December, 2009.
Pursuant to the requirements of Schedule XIII Part II Section II Clause
(C) Proviso (iv) point IV sub-point (2), the following details are
being disclosed:
i) All elements of remuneration package such as salary, benefits,
bonuses, stock options, pension, etc., of all the Directors for the
year ended 31st December 2009:
Executive Directors
Name of
Director Salary Benefits Bonus/ Sitting
(Rs.) (Rs.) Commission (Rs.) Fees (Rs.)
Mr. Madhavan
Menon 5,726,688 9,036,031 - -
Mr. Vinayak
K. Purohit 3,533,808 9,420,214 - -
Mr. Rakshit
Desai 8,129,004 15,439,155 - -
Sub-Total
(a) 17,389,500 33,895,400 - -
Date of Director Pension * Total Stock
(Rs.) (Rs.) Options
Mr. Madhavan Menon 859,008 15,621,727 --
Mr. Vinayak K. Purohit 530,076 13,484,098 --
Mr. Rakshit Desai - 23,568,159 --
Sub - Total (a) 1,389,084 52,673,984 --
* Pension includes Superannuation
Non-Executive Directors
Name of Director Salary Benefits Bonus/ Sitting Fees
(Rs.) (Rs.) Commission (Rs.) (Rs.)
Mr. Udayan Bose - - 209,473 120,000
Mr. H. S. Billimoria - - 516,603 430,000
Mr. A. V. Rajwade - - 516,603 410,000
Mr. DilipDe - - 516,603 180,000
Mr. Ramesh Savoor - - 307,131 120,000
Mr. M. K. Sharma - - 307,131 280,000
Mr. Krishnan - - 307,131 60,000
Ramachandran
Sub-Total (b) - - 2,680,675 1,600,000
Total (Rs.) (a+b) - - 55,354,659 1,600,000
Name of Director Pension Total Stock
(Rs) (Rs.) Options
Mr. Udayan Bose - 329,473 -
Mr. H. S. Billimoria - 946,603 -
Mr. A. V. Rajwade - 926,603 -
Mr. Dilip De - 696,603 -
Mr. Ramesh Savoor - 427,131 -
Mr. M. K. Sharma - 587,131 -
Mr. Krishnan
Ramachandran - 367,131 -
Sub-Total (b) - 4,280,675 -
Total (Rs.) (a+b) - 56,954,659 -
With effect from May, 2005, Commission to the Executive Directors was
paid on the Return on Equity (ROE) formula.
None of the Directors held any shares in the Company as on 31st
December 2009 other than Mr. Madhavan Menon, who held 2000 equity
shares as on that date.
ii) Details of fixed component and performance linked incentives along
with the performance criteria:
Name of Director Salary
Fixed (Rs.) Performance Linked
Incentives (Rs.)
Mr. Madhavan Menon 15,621,727 --
Mr. Vinayak K. Purohit 13,484,098 --
Mr. Rakshit Desai 23,568,159 --
Total 52,673,984 --
Performance criteria
The Recruitment & Remuneration Committee determines and recommends to
the Board, the compensation of the Directors and employees. The key
components of the Companys Remuneration Policy, as approved by the
Recruitment & Remuneration Committee are:
Compensation is an important element to retain talent.
à Compensation will be competitive and would factor in, the market
compensation levels.
à There will be a variable component in the total Compensation, and
that will be linked to the individual, business and organization
performance.
à Compensation will be transparent, fair and simple to administer.
à Compensation will be fully Legal and Tax compliant, as per the
relevant laws in place.
ESOPs may be granted having regard to the role / designation, length of
service, past performance record, future potential and/or such other
criteria
The shareholders approve the compensation of the Executive Directors
for the entire period of their term. The compensation payable to each
of the Independent Director is limited to a fixed percentage of profits
per year as recommended by the Recruitment & Remuneration Committee.
The aggregate of these is within the limit of 1% of the net profits of
the Company for the year in respect of Non Executive Directors,
calculated as per the provisions of the Companies Act 1956, as approved
by the shareholders, and is separately disclosed in the financial
statements. The actual amount of commission payable to each Non-
Executive Director is decided by the Board based on the overall
contribution and role of such Directors.
The role and the involvement of the Non-Executive Directors as members
of the Board and its Committees, has undergone qualitative changes
pursuant to more stringent accounting standards and corporate
governance norms. Further, in view of the scale and expertise required
for the Companys business, the Company has paid sitting fees at the
rate of Rs. 10,000/- per meeting to the Non-Executive Independent
Directors for attending the meetings of the Board, Audit Committee,
Share Transfers Shareholders/ Investors Grievance Committee and
Recruitment & Remuneration Committee constituted by the Board. With
effect from 29th April 2009, sitting fees for attending Board and Audit
Committee Meetings has been increased to Rs. 20,000/- per meeting.
iii) Details of Service Contracts, Notice Period, etc. of all the
Directors for the financial year ended 31st December 2009
Name of
Director Service Period Notice Severance fees,
Contract Period if any
Mr. Madhavan
Menon Yes 1st May 2009 to 30th
April 2012 6 months As decided by the
management
Mr. Vinayak
K. Purohit Yes 14th May 2007 to 13th
May 2010 3 months As decided by the
management
Mr. Rakshit
Desai Yes 25th November 2008 to
24th November 2010 3 months As decided by the
management
Non-Executive
Directors No None. The Non-Executive
Directors liable to
retire by None None
rotation, get re-appointed
as per the Articles of Association
of the Company and the Companies Act, 1956
iv) Stock option details, if any, and whether the same has been issued
at a discount as well as the period over which accrued and over which
exercisable:
Note: None of the non-executive directors were issued/ granted employee
stock options under the Thomas Cook Employee Stock Option Scheme 2007
as on 31st December 2009
2007 2008
Name of the Director Options Discount % Options issued Discount %
issued
Mr. Madhavan Menon 205000 5% 250500 5%
Mr. Vinayak K. Purohit 162500 5% 185000 5%
Mr. Rakshit Desai NA - NA
2009
Name of the Director Options issued Discount %
Mr. Madhavan Menon -- NA
Mr. Vinayak K. Purohit -- NA
Mr. Rakshit Desai -- NA
Period of accrual: 1/3rd of the options granted, vest every year, over
3 years
Exercise Period: All the options are exercisable over a period of 10
years from the respective grant dates
Acknowledgments
Your Directors thank all the Shareholders, Customers, Vendors for their
continued support throughout the year. We also thank Ministry of
Tourism, Reserve Bank of India and other Banks, Financial Institutions,
Government of India, State Governments, and other Government agencies
for the support extended by them and also look forward to their
continued support in future.
Your Directors also wish to place on record their appreciation of the
contribution made by the Companys employees at all levels but for
whose hard work, solidarity and support your Companys consistent
growth would not have been even possible.
FOR AND ON BEHALF OF THE BOARD
MADHAVAN MENON - Managing Director
VINAYAK K. PUROHIT - Executive Director - Finance
Mumbai
Dated: 17th March, 2010