Notes to Accounts of The Investment Trust of India Ltd.

Mar 31, 2023

Share based payment

Created out of retained earnings for the issuance of ESOP Capital Reserve

Capital reserve will be utilised in accordance with provision of the Companies Act, 2013 Capital Redemption Reserve

Amount of R 5436.00 Lakhs was created out of Securities Premium Amount and same become part of Balance Sheet pursuant to merger of ITI Management Advisors Limited

Amount of R 225.00 Lakhs was created pursuant to redemption of Redeemable Preference Shares and created out of Retained Earnings pursuant to Section 55 of the Companies Act, 2013

Securities Premium Reserve

Securities premium reserve is used to record the premium on issue of shares. These reserve will be utilised in accordance with the provisions of the Companies Act, 2013

General Reserve

Created out of retained earnings

Equity component of compound financial instruments

4,96,500 Equity Shares of R10/- each issued as fully paid-up pursuant to demerger of lending business of ITI Gold Loans Limited (erstwhile known as "United Petro finance Limited") in to Fortune Credit Capital Limited

Retained Earnings

Retained Earnings represents the accumulated profits of the the company.

# During the period under review, The company has redeemed 2,25,000 1% Redeemable Preference Shares of R 100/- out of profits of the company and pursuant to the requirement of section 55 of the Companies Act, 2013 the amount equivalent to the nominal value of the Redeemable Preference Shares i.e R 225.00 Lakhs being transferred to the Capital Redemption account.

‘"Pursuant to demerger of lending business of United Petro finance Limited (UPFL)in to Fortune Credit Capital Limited under the Scheme of Arrangement without payment being received in cash, on the date of acquisition of control by the Company of UPFL, i.e. on 1st October 2018, consideration payable by the Company in form of 4,96,000 Equity shares of R 100 each and 7,32,000 Optionally Convertible Preference Shares (OCPS) of R 325/- each fully paid up recorded by splitting Equity and debt elements separately under Equity share capital suspense, OCPS Equity suspense and OCPS debt suspense respectively.

After receipt of Merger order, from 1st January 2021, Equity share capital, OCPS Equity and OCPS Debt were recorded in books, by reversing suspense account.

During the period under review, pursuant to conversion option exercised by the holder of 721,950 Optionally Convertible Preference Shares (OCPS), the Company has allotted 721,950 equity shares as per the terms of the issuance of Optionally Convertible Preference Shares.

32 FINANCIAL RISK MANAGEMENT

The Company''s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company''s risk management assessment and policies and processes are established to identify and analyze the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the same. Risk assessment and management policies and processes are reviewed regularly to reflect changes in market conditions and the Company''s activities.

Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company''s receivables from customers, loans and investments. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of counterparty to which the Company grants credit terms in the normal course of business.

Trade receivables

The Company has used expected credit loss (ECL) model for assessing the impairment loss. For the purpose, the Company uses a provision matrix to compute the expected credit loss amount. The provision matrix takes into account external and internal risk factors and historical data of credit losses from various customers.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risk to the Company''s reputation.

33 CAPITAL RISK MANAGEMENT

The Company aim to manages its capital efficiently so as to safeguard its ability to continue as a going concern and to optimise returns to our shareholders.

The Company monitors capital on the basis of the carrying amount of debt less cash and cash equivalents as presented on the face of the financial statements.

35 FAIR VALUE MEASUREMENT

Financial Instrument by category and hierarchy

The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

The following methods and assumptions were used to estimate the fair values:

1. Fair value of cash and short-term deposits, trade and other short term receivables, trade payables, other current liabilities, short term loans from banks and other financial institutions approximate their carrying amounts largely due to short term maturities of these instruments.

2. Financial instruments with fixed and variable interest rates are evaluated by the Company based on parameters such as interest rates and individual credit worthiness of the counterparty. Based on this evaluation, allowances are taken to account for expected losses of these receivables. Accordingly, fair value of such instruments is not materially different from their carrying amounts.

The fair values for loans, security deposits and investment in preference shares were calculated based on cash flows discounted using a current lending rate. They are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs including counter party credit risk.

The fair values of non-current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk.

For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.

the Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

36 SEGMENT REPORTING Operating Segments:

a. Advisory services and investment activities

b. Trading Activities Identification of Segments:

The chief operational decision maker monitors the operating results of its Business segment separately for the purpose of making decision about resource allocation and performance assessment. Segment performance is evaluated based on profit or loss and is measured consistently with profit or loss in the financial statements, Operating segment have been identified on the basis of nature of products and other quantitative criteria specified in the Ind AS 108.

Segment revenue and results:

The expenses and income which are not directly attributable to any business segment are shown as unallocable expenditure (net of allocable income).

Segment assets and Liabilities:

Segment assets include all operating assets used by the operating segment and mainly consist of property, plant and equipments, trade receivables, Inventory and other operating assets. Segment liabilities primarily includes trade payable and other liabilities. Common assets and liabilities which can not be allocated to any of the business segment are shown as unallocable assets / liabilities.

B) Details of Defined Contribution Plan

The Company also has certain defined contribution plans. Contributions are made to provident fund in India for employees at the rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the government. The obligation of the Company is limited to the amount contributed and it has no further contractual nor any constructive obligation. The expense recognised during the year towards defined contribution plan is ? 8.20 lakhs (Previous year ? 8.20 lakhs) in the Statement of Profit and Loss for the year ended March 31,2023 under defined contribution plan.

C) Compensated absences

Compensated absences are provided for on the basis of an actuarial valuation, using projected unit credit method, as at the date of the balance sheet, actuarial gains / losses , if any , are immediately recognized in the statement of profit and loss.

42 CONTINGENT LIABILITIES AND CAPITAL COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

a) Corporate guarantee issued in favour of banks to secure credit facilities sanctioned by the banks to subsidiary companies ? 23,700 lakhs (Previous year ? 35,600 lakhs)

b) Claims not acknowledged by the Company relating to income tax ? 6.32 lakhs (Previous year ? 10.78 lakhs)

c) There are no outstanding capital commitments as on March 31,2023 (Previous year Nil).

45 additional Disclosure require which are as under:

There is no Immovable property whose title deed is not held in the name of the company.

The company has not traded or invested in cryptocurrency or virtual currency during the reporting period.

There are no proceedings initiated or pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

The company has not been declared as a wilful defaulter by any bank or Financial Institutions or consortium thereof in accordance with the guidelines on wilful defaulters issued by RBI.

The company has not entered into any transactions with companies which are Struck-off under section 248 of the companies Act, 2013.

The company has neither advanced, loaned or invested funds nor received any fund to/from any person or entity for lending or investing or providing guarantee to/on behalf of the ultimate beneficiary during the reporting periods

46 Previous year''s figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year''s classification.

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Mar 31, 2018

1 COMPANY OVERVIEW

The Investment Trust of India Limited (the Company) was incorporated on June 14, 1991 as a private limited company. It was subsequently converted into a public limited company on October 20, 1994. The company had made an initial public offer in February, 1995. The Company is presently listed on Bombay Stock Exchange and National Stock Exchange. The Company is engaged in Advisory Services and trading activities besides holding investment in subsidiaries. The Group business consist of equity and commodity broking, financial services, lending business, investment banking, reinsurance and third party distribution activities which are carried out by separate subsidiaries of the Company.

(A) Terms / Rights attached to Equity shares

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of an equity share is entitled to one vote per share on every resolution placed before the Company on the right to receive dividend.

Securities premium reserve

Securities premium reserve is used to record the premium on issue of shares. These reserve will be utilised in accordance with the provisions of the Act.

Capital reserve

Capital reserve will be utilised in accordance with provision of the Act.

2 Financial Risk Management

The Company’s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company’s risk management assessment and policies and processes are established to identify and analyze the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the same. Risk assessment and management policies and processes are reviewed regularly to reflect changes in market conditions and the Company’s activities.

Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s receivables from customers, loans and investments. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of counterparty to which the Company grants credit terms in the normal course of business.

Trade receivables

The Company has used expected credit loss (ECL) model for assessing the impairment loss. For the purpose, the Company uses a provision matrix to compute the expected credit loss amount. The provision matrix takes into account external and internal risk factors and historical data of credit losses from various customers.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risk to the Company’s reputation.

3 Capital Risk Management

The Company aim to manages its capital efficiently so as to safeguard its ability to continue as a going concern and to optimise returns to our shareholders.

The Company monitors capital on the basis of the carrying amount of debt less cash and cash equivalents as presented on the face of the financial statements.

The Company’s objective for capital management is to maintain an optimum overall financial structure.

4 First-time adoption of Ind AS

These are the Company’s first financial statements prepared in accordance with Ind AS.

The Company has adopted Indian Accounting Standards (Ind AS) notified by the Ministry of Corporate Affairs with effect from April 1, 2017, with a transition date of April 1, 2016. Ind AS 101-First-time Adoption of Indian Accounting Standards requires that all Ind AS standards and interpretations that are issued and effective for the first Ind AS financial statements which is for the year ended March 31, 2018 for the company, be applied retrospectively and consistently for all financial years presented. Consequently, in preparing these Ind AS financial statements, the Company has availed certain exemptions and complied with the mandatory exceptions provided in Ind AS 101, as explained below. The resulting difference in the carrying values of the assets and liabilities as at the transition date between the Ind AS and Previous GAAP have been recognised directly in equity (retained earnings or another appropriate category of equity).

Set out below are the Ind AS 101 optional exemptions availed as applicable and mandatory exceptions applied in the transition from previous GAAP to Ind AS.

A. Optional Exemptions availed

(a) Deemed Cost

The Company has opted paragraph D7 AA and accordingly considered the carrying value of property, plant and equipments and Intangible assets as deemed cost as at the transition date.

(b) Investments in subsidiaries, joint ventures and associates

The Company has opted para D14 and D15 and accordingly considered the Previous GAAP carrying amount of Investments as deemed cost as at the transition date.

(c) Business Combination

All transactions qualifying as business combinations under Ind AS103, occurring before the transition date, the Group has opted not to restate any business combinations before the date of transition.

B. Applicable Mandatory Exceptions

(a) Estimates

An entity’s estimates in accordance with Ind ASs at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies).

Ind AS estimates as at April 1, 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP.

The Company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under previous GAAP:

- Investment in equity instruments carried at Fair Value through Profit & Loss (FVPL) or Fair Value through Other Comprehensive Income (FVOCI);

- Investment in debt instruments carried at FVPL.”

(b) Classification and measurement of financial assets

As required by Ind AS 101, the company has assessed the classification and measurement of financial assets (investment in debt instruments) on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

(c) Transition to Ind AS - Reconciliations

The following reconciliations provide a quantification of the effect of significant differences arising from the transition from previous GAAP to Ind AS in accordance with Ind AS 101:

I. Reconciliation of Balance sheet as at April 1, 2016 (Transition Date)

II. A. Reconciliation of Balance sheet as at March 31, 2017

B. Reconciliation of Total Comprehensive Income for the year ended March 31, 2017

III. Reconciliation of Equity as at April 1, 2016 and as at March 31, 2017

IV. Adjustments to Statement of Cash Flows

The presentation requirements under Previous GAAP differs from Ind AS, and hence, Previous GAAP information has been regrouped for ease of reconciliation with Ind AS. The Regrouped Previous GAAP information is derived from the Financial Statements of the Company prepared in accordance with Previous GAAP.

IV. Adjustments to Statement of Cash Flows

The Ind AS adjustments are either non cash adjustments or are regrouping among the cash flows from operating, investing and financing activities. Consequently, Ind AS adoption has no impact on the net cash flow for the year ended March 31, 2017 as compared with the previous GAAP.

The following explains the material adjustments made while transition from previous accounting standards to IND AS:

1 Dividend on preference shares

Preference shares, which are mandatorily redeemable on a specific date are classified as liabilities. The dividend on these preference shares is recognised in Statement of Profit and Loss as finance cost.

2 Re-measurements of post employment benefit obligation

Under Ind AS, re-measurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognised in other comprehensive income instead of profit and loss. Under the previous GAAP, these re-measurements were forming part of the profit and loss for the year.

3 Corporate Guarantee Fees

Under Ind AS, where guarantees in relation to loans or other payables of subsidiaries are provided for without any compensation, the fair values are accounted for as contributions and recognised as part of the cost of the investment.

4 Fair value of Investment

Under the previous GAAP, investments in equity instruments were classified as long-term investments or current investments based on the intended holding period and realisability. Long-term investments were carried at cost less provision for other than temporary decline in the value of such investments. Current investments were carried at lower of cost and fair value. Under IND AS, these investments are required to be measured at fair value. The resulting fair value changes of these investments have been recognised in retained earnings as at March 31, 2017 is nil. (? 257.98 Lakhs as at April 1, 2016).

5 Deferred Tax

Tax adjustment include deferred tax impact on account of differences between previous GAAP and Ind AS. These adjustments have resulted in an decrease in equity under Ind AS by Rs. 33.70 Lakhs and Rs. 116.33 Lakhs as at March 31, 2017 and April 1, 2016 respectively and decrease in net profit by Rs. 89.80 Lakhs for the year ended March 31, 2017.

5 FAIR VALUE MEASUREMENT

Financial Instrument by category and hierarchy

The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

The following methods and assumptions were used to estimate the fair values:

1. Fair value of cash and short-term deposits, trade and other short term receivables, trade payables, other current liabilities, short term loans from banks and other financial institutions approximate their carrying amounts largely due to short term maturities of these instruments.

2. Financial instruments with fixed and variable interest rates are evaluated by the Company based on parameters such as interest rates and individual credit worthiness of the counterparty. Based on this evaluation, allowances are taken to account for expected losses of these receivables. Accordingly, fair value of such instruments is not materially different from their carrying amounts.

The fair values for loans, security deposits and investment in preference shares were calculated based on cash flows discounted using a current lending rate. They are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs including counter party credit risk.

The fair values of non-current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level

3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk.

For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

6 SEGMENT REPORTING

Operating Segments:

a. Advisory services and investment activities

b. Trading Activities

Identification of Segments:

The chief operational decision maker monitors the operating results of its Business segment separately for the purpose of making decision about resource allocation and performance assessment. Segment performance is evaluated based on profit or loss and is measured consistently with profit or loss in the financial statements, Operating segment have been identified on the basis of nature of products and other quantitative criteria specified in the Ind AS 108.

Segment revenue and results:

The expenses and income which are not directly attributable to any business segment are shown as unallocable expenditure (net of allocable income).

Segment assets and Liabilities:

Segment assets include all operating assets used by the operating segment and mainly consist of property, plant and equipments, trade receivables, Inventory and other operating assets. Segment liabilities primarily includes trade payable and other liabilities. Common assets and liabilities which can not be allocated to any of the business segment are shown as unallocable assets / liabilities.

Disclosure pursuant to Ind AS 108 “Operating Segment

7 Disclosure pursuant to Indian Accounting Standard (Ind AS) 19 “Employee Benefits

A) Defined Benefit Plans

The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The gratuity plan is a funded plan and the Company makes contributions to recognised funds in India.

VIII Risk Exposure

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below :

i) Actuarial Risk It is the risk that benefits will cost more than expected. This can arise due to Adverse Salary Growth Experience, Variability in mortality rates and Variability in withdrawal rates.

ii) Investment Risk For funded plans that rely on insurers for managing the assets, the value of assets certified by the insurer may not be the fair value of instruments backing the liability. In such cases, the present value of the assets is independent of the future discount rate. This can result in wide fluctuations in the net liability or the funded status if there are significant changes in the discount rate during the inter-valuation period.

iii) Liquidity Risk Employees with high salaries and long durations or those higher in hierarchy, accumulate significant level of benefits. If some of such employees resign/retire from the company there can be strain on the cashflows

iv) Market Risk Market risk is a collective term for risks that are related to the changes and fluctuations of the financial markets. One actuarial assumption that has a material effect is the discount rate. The discount rate reflects the time value of money. An increase in discount rate leads to decrease in Defined Benefit Obligation of the plan benefits & vice versa. This assumption depends on the yields on the corporate/government bonds and hence the valuation of liability is exposed to fluctuations in the yields as at the valuation date.

v) Legislative Risk Legislative risk is the risk of increase in the plan liabilities or reduction in the plan assets due to change in the legislation/regulation. The government may amend the Payment of Gratuity Act thus requiring the companies to pay higher benefits to the employees. This will directly affect the present value of the Defined Benefit Obligation and the same will have to be recognized immediately in the year when any such amendment is effective.

B) Details of Defined Contribution Plan

The Company also has certain defined contribution plans. Contributions are made to provident fund in India for employees at the rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the government. The obligation of the Company is limited to the amount contributed and it has no further contractual nor any constructive obligation. The expense recognised during the year towards defined contribution plan is Rs. 5.41 lakhs (Previous year Rs. 7.98 lakhs) in the Statement of Profit and Loss for the year ended March 31, 2018 under defined contribution plan.

C) Compensated absences

Compensated absences are provided for on the basis of an actuarial valuation, using projected unit credit method, as at the date of the balance sheet, actuarial gains / losses , if any , are immediately recognized in the statement of profit and loss.

8 The Company has taken office premises under operating lease . These agreements provide an option to the Company to renew the lease period on mutually agreeable terms. The Company has given refundable interest free security deposits in accordance with the agreed terms. The rental expense in respect of the operating leases, recognised in the Statement of Profit and Loss as “Rent” in Note “26” is Rs. 110.48 lakhs (previous year Rs. 47.04 lakhs). Details of the minimum lease payments for the operating leases are provided hereunder:

9 Contingent liabilities and capital commitments (to the extent not provided for)

a) Corporate guarantee issued in favour of banks to secure credit facilities sanctioned by the banks to subsidiary companies Rs. 47,800 lakhs (Previous year Rs. 21,300 lakhs)

b) Claims not acknowledged by the Company relating to income tax Rs. 28.78 lakhs (Previous year Rs. 49.09 lakhs)

c) There are no outstanding capital commitments as on March 31, 2018 (Previous year Nil).

10 In respect of litigations filed by the Company for recovery amount of Rs. 300.50 lakhs (Previous year Rs. 300.50 lakhs) no provision has been made as the management is of the opinion that entire amount is fully recoverable.

11 The scheme of amalgamation (“Scheme”) between the Company and The Investment Trust of India Limited (“ITIL”) (Formerly known as ITI Wealth Management Private Limited) was approved by the Hon’ble Bombay High Court on October 20, 2016 and from The National Company Law Tribunal (NCLT) and other applicable regulatory authorities on December 13, 2017. The Scheme between the Company and ITIL and their respective shareholders and creditors, for merger of ITIL with and into the Company has become effective from January 01, 2016, hence ITIL ceased to exist effective from January 01, 2016. The financial statements of the company include all the assets, liabilities, reserves and surplus of ITIL at their carrying amounts and in the same form as at the appointed date. In terms of the Scheme, the Company has issued 2,25,000 1% Redeemable Preference Shares of Rs. 100/- each fully paid-up on January 02, 2018.

12 The Scheme of Arrangement (“Proposed Scheme-1”) between United Petro Finance Limited (‘UPFL’ or the ‘Demerged Company’) and Fortune Credit Capital Limited (‘FCCL’ or the ‘Resulting Company’) and their respective shareholders providing for the demerger of Lending Business (‘NBFC Business’) of UPFL to FCCL (Wholly Owned Subsidiary of Company), and issue of equity shares of the Company to the shareholders of UPFL with effect from March 31, 2017 (appointed date) was approved by the Board of Directors of the respective Companies on March 31, 2017. The proposed Scheme-1 is returned by the Stock Exchanges on the ground that the same is not in compliance with Clause (I)(A)(3)(b) of the SEBI Circular No. CFD/CIR/2018/2 dated January 3, 2018. The Company has provided undertaking to the Exchanges for ensuring compliance with applicable provisions of the SEBI Circulars and the same is being processed by SEBI. The Company is awaiting the response from the Exchanges. Pending the approval of the Proposed Scheme-1 no effect of the Proposed Scheme-1 has been given in these financial statements.

13 The Scheme of Amalgamation (“Proposed Scheme-2”) for amalgamation of Fortune Integrated Assets Finance Limited (‘FIAFL’ or the ‘Transferor Company’) with the Company with effect from March 31, 2017 (appointed date) was approved by the Board of Directors of the respective Companies on April 25, 2017. The proposed Scheme-2 is returned by the Stock Exchanges on the ground that the same is not in compliance with Clause (I)(A)(3)(b) of the SEBI Circular No. CFD/CIR/2018/2 dated January 3, 2018. The Company has provided undertaking to the Exchanges for ensuring compliance with applicable provisions of the SEBI Circulars and the same is being processed by SEBI. The Company is awaiting the response from the Exchanges. Pending the approval of the Proposed Scheme-2, no effect of the Proposed Scheme-2 has been given in these financial statements.

14 The company has requested its creditors to confirm the applicability to them under the Micro Small and Medium Enterprises Development Act, 2006. Based on the responses received by the Company, the details of dues to micro enterprises and small enterprises are as under:

Note: The information as required to be disclosed under Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the company.

15 In the opinion of the Management, the value of all Current Assets, Loans and Advances and other receivables is not less than their realisable value in the ordinary course of business.

16 Balances standing in debtors, creditors and loan and advances are subject to confirmation.

17 Previous year’s figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year’s classification.

18 The Financial Statements were approved for issue by the directors on October 26, 2018.

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Mar 31, 2017

c Terms / Rights attached to Equity shares

The Company has only one class of equity shares having a par value of '' 10 per share. Each holder of an equity share is entitled to one vote per share on every resolution placed before the Company on the right to receive dividend.

1. Contingent Liabilities and Capital Commitments ( to the extent not provided for)

a) Corporate guarantee issued in favour of a banks to secure credit facilities sanctioned by the banks to subsidiary companies Rs, 21,300 lakhs ( Previous year Rs, 22,500 lakhs)

b) Claims not acknowledged by the Company relating to income tax Rs, 49.09 lakhs ( Previous year Rs, 38.82 lakhs)

2. In respect of litigations filed by the Company for recovery amount of Rs, 300.50 lakhs, no provision has been made as the management is of the opinion that entire amount is fully recoverable.

3. Exceptional Item represents profit on sale of Investment and sale of rights in property

4. During the year, the Company has allotted 22,677,777 (Two crores twenty six Lakhs seventy seven thousand seven hundred seventy seven) equity shares of Rs, 10 each at a price of Rs, 90/- (including premium of Rs, 80/- each) per equity share aggregating to Rs, 20,410.00 lakhs through right issue to its existing equity shareholders. Proceeds from the Right Issue have been fully utlised for the purpose for which it is raised.

5. The scheme of amalgamation ("Proposed Scheme") for amalgamation of The Investment Trust of India Ltd (Formerly known as ITI Wealth Management Private Limited) with the Company with effect from January 01, 2016 (appointed date) is approved by the Hon''ble Bombay High Court. However, approval to the Proposed Scheme from Hon''ble Chennai High Court/National Company Law Tribunal( NCLT) and other applicable regulatory authorities are yet to be received. Pending approval of the Proposed Scheme, no effect of the Proposed Scheme has been given in these financial statements.

6. The Scheme of Arrangement ("Proposed Scheme") between United Petro Finance Limited (''UPFL'' or the ''Demerged Company'') and Fortune Credit Capital Limited (''FCCL'' or the ''Resulting Company'') Company and their respective shareholders providing for the demerger of Lending Business (''NBFC Business'') of UPFL to FCCL (Wholly Owned Subsidiary of Company), and issue of equity shares of the Company to the shareholders of UPFL with effect from March 31, 2017 (appointed date) was approved by the Board of Directors of the respective Companies on March 31, 2017. However, the approval to the Proposed Scheme from National Company Law Tribunal (NCLT), Reserve Bank of India (RBI) and other applicable regulatory authorities are yet to be received. Pending the approval of the Proposed Scheme, no effect of the Proposed Scheme has been given in these financial statements.

7. The Scheme of Amalgamation ("Proposed Scheme") for amalgamation of Fortune Integrated Assets Finance Limited (''FIAFL'' or the ''Transferor Company'') with Company and their respective shareholders with the Company with effect from March 31, 2017 (appointed date) was approved by the Board of Directors of the respective Companies on April 25, 2017. However, the approval to the Proposed Scheme from National Company Law Tribunal (NCLT), Reserve Bank of India (RBI) and other applicable regulatory authorities are yet to be received. Pending the approval of the Proposed Scheme, no effect of the Proposed Scheme has been given in these financial statements.

Note: The information as required to be disclosed under Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the company.

8. In the opinion of the Management, the value of all Current Assets, Loans and Advances and other receivables is not less than their realizable value in the ordinary course of business.

9. Balances standing in debtors, creditors and loan and advances are subject to confirmation.

10. Previous year''s figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year''s classification.

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Mar 31, 2016

1. Segment reporting

The Company is primarily engaged in the business of financial advisory and consultancy services. All the activities of the Company revolve around the main business. Further, the Company does not have any separate geographic segments other than India. There are no separate reportable segments as per Accounting Standard 17 on "Segment Reporting" (AS-17) issued by the Institute of Chartered Accountants of India.

2. Related party Transactions

Details of the related parties with whom transactions were carried out during the year along with a description of the relationship and the

amounts involved are provided below.

a) Names of related parties and nature of relationship

i) Related parties where control exists

In time Equities Limited Subsidiary

Fortune Credit Capital Limited Subsidiary

In time Multi Commodity Company Limited Subsidiary

ITI Investment Advisors Limited Subsidiary

Fortune Integrated Home Finance Limited Subsidiary

Antique Stock Broking Limited Subsidiary

Inga Capital Private Limited Subsidiary

Distress Asset Specialist Private Limited ( wef 01.09.2015) Subsidiary

ITI Wealth Management Private Limited (wef 23.10.2015) Subsidiary

Kohinoor India Reinsurance Co. Limited (wef 30.03.2016) Subsidiary

Neue Allianz Corporate Services Private Limited Step down subsidiary

ii) Enterprises having significant influence

Fortune Integrated Assets Finance Limited (wef 30.04.2015) Associate

United Petro Finance Limited (wef 30.03.2016) Associate

iii) Key managerial personnel and their relatives

Mr. YashpalMadan (upto 30.07.2015) Manager

Mr. Aalok Dave (w.e.f 31.07.2015) Manager

Mr. S. G. Muthu Kumar Chief Financial Officer

3. The Company has taken office premises under operating lease . These agreements provide an option to the Company to renew the lease period on mutually agreeable terms. The Company has given refundable interest free security deposits in accordance with the agreed terms. The rental expense in respect of the operating leases, recognized in the Statement of Profit and Loss as "Rent" in Note "19" is Rs. 47.63 lakhs (previous year Rs.43.32 lakhs). Details of the minimum lease payments for the operating leases are provided hereunder:

4. Contingent Liabilities and Capital Commitments ( to the extent not provided for)

a) Corporate guarantee issued in favour of a banks to secure credit facilities sanctioned by the banks to subsidiary companies Rs.22,500 lakhs ( Previous year Rs.28,000 lakhs)

b) Claims not acknowledged by the Company relating to income tax Rs. 38.82 lakhs ( Previous year Rs.37.97 lakhs)

5. Exceptional Item represents profit on sale of Investment in Fortune Integrated Assets Finance Limited.

6. Rights issue of the Company comprising 22,677,777 (Two crores twenty six Lakhs seventy seven thousand seven hundred seventy seven) equity shares of Rs. 10 each at a price of Rs. 90/- (including premium of Rs.80/- each) per equity share aggregating to Rs 20,410.00 lakhs to its existing equity shareholders was made open for subscription on March 28, 2016 and concluded on April 12, 2016. The Share application money pending allotment received upto March 31, 2016 is held in escrow account. The Company has allotted aforesaid shares on April 25, 2016.

7. "The Scheme of Amalgamation ("Scheme") between ITI Wealth Management Private Limited ("Transferor Company") and Fortune Financial Services (India) Limited ("Transferee Company") with effect from "appointed date" of 1st January, 2016 is awaiting approval of High Court of Bombay and Chennai under section 391 to 394 of the companies Act, 1956 and to the extent applicable, provisions of the Companies Act, 2013. As the approval of Hon''ble High Court of Bombay and Chennai is awaited thus the amalgamation though effective from "appointed date" 1st January, 2016 shall be operative from "effective date" i.e. the last of date on which all the consents and approvals referred to in the Scheme are obtained or waived. As approvals and sanctions of the Scheme from the Hon''ble High Court of Bombay and Chennai are pending, Company''s accounts have been prepared independently without giving effect of the Scheme. The effect of the above amalgamation will be given in the Annual Accounts of the Company, in the Financial Year in which all the sanctions or orders as specified in the Scheme of Amalgamation are obtained and/or filled.

8. There are no amounts payable to any micro, small and medium enterprises as identified by the management from the information available with the Company and relied upon by auditors.

9. In the opinion of the Management, the value of all Current Assets, Loans and Advances and other receivables is not less than their realizable value in the ordinary course of business.

10. Balances standing in debtors, creditors and loan and advances are subject to confirmation.

11. Previous year''s figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year''s classification.

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Mar 31, 2015

1. Terms / Rights attached to Equity shares

The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of an equity share is entitled to one vote per share on every resolution placed before the Company on the right to receive dividend. In the event of liquidation of the Company, the holder of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

2. Segment reporting

The Company is primarily engaged in the business of financial advisory and consultancy services. All the activities of the Company revolve around the main business. Further, the Company does not have any separate geographic segments other than India. There are no separate reportable segments as per Accounting Standard 17 on "Segment Reporting" (AS-17) issued by the Institute of Chartered Accountants of India.

3. Related party Transactions

Details of the related parties with whom transactions were carried out during the year alongwith a description of the relationship and the

amounts involved are provided below.

a) Names of related parties and nature of relationship

i) Related parties where control exists

Intime Equities Limited Subsidiary

Fortune Credit Capital Limited Subsidiary

Intime Multi Commodity Company Limited Subsidiary

Fortune Integrated Assets Finance Limited Subsidiary

ITI Investment Advisors Limited Subsidiary

Fortune Integrated Home Finance Limited Subsidiary

Antique Stock Broking Limited Subsidiary

Inga Capital Private Limited ( w.e.f. 26-02-2015) Subsidiary

ITI Financial Services Limited ( w.e.f. 16-10-2014) Step down subsidiary

ITI Investor Services Limited ( w.e.f. 16-10-2014) Step down subsidiary

Neue Allianz Corporate Services Pvt. Ltd. (w.e.f. 26 - 02 -2015) Step down subsidiary

ii) Key management personnel and their relatives

Mr. Chintan V. Valia Director

Mr Nimish C Shah (up to 10-04-2014) Managing Director

Ms.Khyati Valia (w.e.f. 25-03-2015) Director

Mr. Yashpal Madan Manager

Mr. Muthu Kummar Chief Financial Officer

4.Contingent Liabilities and Capital Commitments ( to the extent not provided for)

a) Fixed deposits of the Company pledged with a bank for overdraft facility of a subsidiary Nil ( Previous year Rs.1,349.49 lakhs)

b) Guarantee given by the banks on behalf of Fortune Group in respect of capital adequacy, daily margin and other contractual commitments for capital market operations of its subsidiaries is Rs.5,843.75 lakhs ( Previous year Rs.6,786.25 lakhs)

Corporate guarantee issued in favour of a banks to secure credit facilities sanctioned by the banks to subsidiary companies Rs.28,000 lakhs ( Previous year Rs.6500 lakhs)

c) Claims not acknowledged by the Company relating to Income Tax Rs. 37.97 lakhs ( Previous year Rs.12.36 lakhs)

5. There are no amounts payable to any micro, small and medium enterprises as identified by the management from the information available with the Company and relied upon by auditors.

6. In the opinion of the Management, the value of all Current Assets, Loans and Advances and other receivables is not less than their realisable value in the ordinary course of business.

7. Balances standing in debtors, creditors and loan and advances are subject to confirmation.

8. Previous year's figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year's classification.

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Mar 31, 2014

1 COMPANY OVERVIEW

Fortune Financial Services (India) Limited (the ''Company'') and its seven wholly owned Indian subsidiaries (collectively referred to as the "Group") is one of the hybrid players in the business that are present both in corporate finance as well as entire broking spectrum. The ''Group''s full service portfolio consists of investment banking and corporate finance activities on the capital market side as well as advisory services,broking services in the cash and future & options segments,currency derivatives, commodities,along with offering depository services, loan,portfolio management services and other wealth and distribution related products.

2 BASIS OF CONSOLIDATION

The Consolidated Financial Statements relate to Fortune Financial Services (India) Limited (the Company) and its subsidiaries (collectively referred to as "the Fortune Group").

3 SEGMENT REPORTING

Primary segment

Segments have been identified in accordance with Accounting Standard 17 ''Segment Reporting'', issued by the Institute of Chartered Accountants of India considering the organisation structure and return/risk profile of the businesses. The Management recognises and monitors these segments on a continuous basis

Secondary segment

The company does not have any separate geographical segment other than India.

4 Related party transactions

Names of related parties and nature of relationship

a) Enterprises having significant influence

Mehra Capital services Private Limited (up to 07-10-2013) Jamish Investment Private Limited Fortune Capital Services

b) Key management personnel and their relatives:

Mr. J.T. Poonja, Chairman (up to 07-10-2013) Mr. Nimish C. Shah, Managing Director Ms. Jalpa N Shah, Relative Ms. Vidhi N Shah, Relative

b) Defined Contribution Plans:

The amount recognised as expenses and included in "Contribution to gratuity, provident and other funds" in Note 20 is Rs. 44.89 lakhs (Previous year Rs. 49.53 lakhs).

c) General Description of significant defined benefit plan

Gratuity Plan : Gratuity is payable to all eligible employees of the Company in terms of the provision of the Payment of Gratuity Act, 1972

(II) Disclosure in respect of the Retirement Benefits for the subsidiary acquired on March 31, 2014.

i) Gratuity: Provision for the gratuity liability amounting to Rs. 16,86,193 (P.Y. Rs. 49,846) has been made during the year by the company based on the valuation report of the Life Insurance Corporation (Actuarial Valuer).

ii) Provident Fund: Provident Fund contributions are made to the Government Provident Fund Authority.

5 Contingent Liabilities and commitments ( to the extent not provided for)

a) Contingent liabilities

Guarantees given by banks on behalf of the Group In respect of capital adequacy, daily margin and other contractual commitments for capital market operations of the Company is Rs. 6,786.25 lakhs (Previous year Rs. 5,528.75 lakhs)

b) Estimated amount of contracts remaining to be executed on capital account Rs. 565.66 (Previous year Nil)

6. In accordance with a Memorandum of Understanding entered into during the year, the Company has acquired 100% of the equityshares of Antique Stock Broking Limited with effect from March 31, 2014 for Rs.12 crores. The acquired company is engaged in thebusiness of shares and stock broking. The acquisition is expected to synergise and lead to better utilisation of available resources among its subsidiaries and result in greater economies of scale.

7 a) In accordance with a Memorandum of Understanding entered into during the year, the Company has acquired 100% of the equity shares of Antique Stock Broking Limited with effect from March 31, 2014 for Rs. 12 cores. The acquired company is engaged in the business of shares and stockbroking. The acquisition is expected to synergise and lead to better utilisation of available resources among its subsidiaries and result in greater economies of scale.

b) The subsidiary discharged the consideration through bank payments and accordingly accounted for the acquisition under the purchase method recognizing the assets at fair value. The excess of purchase consideration paid by the subsidiary over the aggregate value of net assets acquired has been treated as Goodwill, to be amortized over a period of 5 years from the date of purchase.

8 Under Micro, Small and Medium Enterprises Development Act, 2006 which came into force from October 2, 2006, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. The Company has not yet commenced the process of compiling the relevant information from its suppliers about their coverage under the said Act and hence the relevant disclosures have not been made in the accounts. However, in the view of the Management, there is no possibility of any interest being payable to any supplier as the Company is prompt in making payments to its suppliers.

9. Profit and Loss of a new subsidiary has not been considered for the purpose of presenting the Consolidated result of operations and the consolidated cash flows as the acquisition of the subsidiary was completed on March 31, 2014.

10 In the opinion of Management, the value of all current assets, loans and advances and other receivables is not less than their realisable value in the ordinary course of business.

11 Balances standing in debtors, creditors and loan and advances are subject to confirmation.

12 Previous year''s figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year''s classification.

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Mar 31, 2013

1 COMPANY OVERVIEW

Fortune Financial Services (India) Limited (''Fortune''or the Company) was incorporated on June 14, 1991 as a private limited company. It was subsequently converted into a public limited company on October 20, 1994. The company was made an initial public offer in February, 1995. The Company is presently listed on The Bombay Stock Exchange. The company has six wholly owned Indian subsidiaries for equity and commodity broking, financing and third party distribution activities. The company is SEBI registered Category - I Merchant Banker and a provider of Portfolio Management Services (PMS). Major activities include investment banking as well as corporate finance on the capital market side as well as advisory through well networked and entrenched in the corporate space.

2 SEGMENT REPORTING

The Company is primarily engaged in the business of investment and merchant banking activities. All the activities of the Company revolve around the main business. Further, the Company does not have any separate geographic segments other than India. There are no separate reportable segments as per Accounting Standard 17 on "Segment Reporting" (AS-17) issued by the Institute of Chartered Accountants of India.

3 RELATED PARTY TRANSACTIONS

Details of the related parties with whom transactions were carried out during the year alongwith a description of the relationship and the amounts involved are provided below.

a) Names of related parties and nature of relationship

i) Related parties where control exists (Subsidiary Companies)

Fortune Equity Brokers (India) Limited

Fortune Commodities & Derivatives (India) Limited

Fortune Credit Capital Limited

Fortune Financial India Insurance Brokers Limited

Fortune Integrated Home Finance Limited

Fortune Integrated Assets Finance Limited

ii) Enterprises having significant influence

Mehra Capital Services Private Limited Jamish Investment Private Limited Umrigar Investment Private Limited Fortune Capital Services J. T. Poonja ( HUF) Nimish C Shah ( HUF)

iii) Key management personnel and their relatives

Mr. J.T. Poonja, Executive Chairman

Mr. Nimish C Shah, Managing Director

Mrs. Sangeeta Poonja, Director (up to July 31, 2012)

Mr. Abhinay Poonja, Relative of a Director

Ms. Aparna Poonja, Relative of a Director

Mrs. Jalpa N. Shah, Relative of a Director

Ms. Vidhi Shah, Relative of a Director

Mrs. Indumati Shah, Relative of a Director

4 The Company has taken office premises under operating lease at various locations. These agreements provide an option to the Company to renew the lease period on mutually agreeable terms. The Company has given refundable interest free security deposits in accordance with the agreed terms.

The rental expense in respect of the operating leases, recognised in the Statement of Profit and Loss as "Rent" in Note "19" is Rs. 51.00 lakhs (previous year Rs.51.00 lakhs)

5 CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

a) Fixed deposits of the Company pledged with a bank for overdraft facility of a subsidiary Nil (Previous year Rs.l 125.42 lakhs)

b) Guarantee given by the banks on behalf of Fortune Group in respect of capital adequacy, daily margin and other contractual commitments for capital market operations of the Company of its Subsidiaries is Rs.5,258.75 lakhs (Previous " year Rs.5,548.75 lakhs)

c) Estimated amount of contracts remaining to be executed on capital account Nil (Previous year Nil)

6 Under Micro, Small and Medium Enterprises Development Act, 2006 which came into force from October 2, 2006, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. The Company has not yet commenced the process of compiling the relevant information from its suppliers about their coverage under the said Act and hence the relevant disclosures have not been made in the accounts. However, in the view of the Management, there is no possibility of any interest being payable to any supplier as the Company is prompt in making payments to its suppliers.

7 In the opinion of Management, the value of all Current Assets, Loans and Advances and other receivables is not less than their realisable value in the ordinary course of business.

8 Balances standing in debtors, creditors and loan and advances are subject to confirmation.

9 Previous year''s figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year''s classification.

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Mar 31, 2012

1 COMPANY OVERVIEW

Fortune Financial Services (India) Limited ('Fortune' or the Company) was incorporated on June 14, 1991 as a private limited company. It was subsequently converted into a public limited company on October 20, 1994. The company was made an initial public offer in February, 1995. The Company is presently listed on Bombay Stock Exchange. The company has four wholly owned Indian subsidiaries for equity and commodity broking, financing and third party distribution activities. The company is SEBI registered Category - I Merchant Banker and Portfolio Management Services (PMS). Major activities includes investment banking as well as corporate finance on the capital market side as well as advisory through well networked and entrenched in the corporate space.

a Terms / Rights attached to Equity shares

The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of an equity share is entitled to one vote per share.

During the year ended March 31, 2012 the amount of per share dividend recognized as distribution to equity shareholders was Rs.0.50 per share (March 31, 2011 Rs.2.00 per share)

In the event of liquidation of the Company, the holder of equity shares will be entitled to receive their share in the remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

b The Company has not reserved any shares for issue of options and contracts / commitments for sale of shares / divestments; Other than issue against ESOPs as provided (in Rs.) below:

c During the period of five years preceding March 31, 2012

a) The Company has not allotted any shares pursuant to contract(s) without payment being received in cash

b) The Company has not allotted any bonus shares

c) The Company has not bought back any shares

d Employee Stock Option Plan ("ESOP")

The Employee Stock Option Plan provides that the Company's employee and those of its subsidiaries are granted options to acquire equity shares of the Company. The options may be exercised within a specified period.

The Company follows the intrinsic value method to account for its stock based compensation plans. Compensation cost is measured as the excess, if any of the fair market value of the underlying share over the exercise price.

The Company currently has two ESOP schemes, ESOP scheme 2006 and ESOP Scheme 2007. These schemes were duly approved by the Board of Directors and Shareholders in their respective meetings. The 2006 scheme provides for the issue of 522,500 options and 2007 scheme for 60,690 options to eligible employees. These schemes are administered by the Compensation Committee comprising four members, the majority of whom are independent directors.

As the exercise is made at the market price prevailing on the date of the grant, the issuance of equity shares pursuance to exercise of options does not affect the profit and loss of the Company.

Of the options exercised Nil (Previous year 155,500) options were exercised by the employees of the subsidiaries.

400.000 equity warrants of Rs.10 each issued on preferential basis to its promoters on September 13, 2010 ,have been lapsed during the year due to non-exercise of options by the holders of the equity warrants. The amount received on the above equity warrants Rs.180.00 lacs, has been forfeited by the Company and credited to Capital Reserve.

2. MONEY RECEIVED AGAINST SHARE WARRANTS

As at the beginning of the year, the Company had Rs.300 lacs, received as application money against 600,000 equity warrants of Rs.10 each at a premium of Rs.70 per warrant and 4, 00,000 equity warrants of Rs.10 each at a premium of Rs.170 per equity warrant issued on preferential basis to its promoters. In accordance with the terms of the issue, the holders of these warrants had the option to apply for one equity share of Rs.10 each at any time within a period of eighteen months from the date of issue.

400.000 equity warrants of Rs.10 each issued on September 13, 2010 lapsed during the year due to non-exercise of options by the holders of the equity warrants. The amount received on the above equity warrants Rs.180 lacs, has been forfeited by the Company and credited to Capital Reserve.

600.000 equity warrants of Rs.10 each issued on February 10, 2010 , were converted in to 6,00,000 equity shares of Rs.10 each fully paid at a premium of Rs.70 per share on exercise of the options on July 29, 2011.

3 SEGMENT REPORTING

The Company is primarily engaged in the business of investment and merchant banking activities. All the activities of the Company revolve around the main business. Further, the Company does not have any separate geographic segments other than India. There are no separate reportable segments as per Accounting Standard 17 on "Segment Reporting" issued by the Institute of Chartered Accountants of India.

4 Related party Transactions

Details of the related parties with whom transactions were carried out during the year along with a description of the relationship and the amounts involved are provided below.

a) Names of related parties and nature of relationship

i) Related parties where control exists (Subsidiary Companies)

Fortune Equity Brokers (India) Limited

Fortune Commodities & Derivatives (India) Limited

Fortune Credit Capital Limited

Fortune Financial India Insurance Brokers Limited

ii) Enterprises having significant influence

Mehra Capital Services Private Limited Jamish Investment Private Limited Umrigar Investment Private Limited Fortune Capital Services J.T. Poonja (HUF)

Nimish C. Shah (HUF)

iii) Key management personnel and their relatives

Mr. J.T. Poonja, Executive Chairman Mr. Nimish C. Shah, Managing Director Mrs. Sangeeta Poonja, Director Mr. Abhinay Poonja, Relative of a Director Ms. Aparna Poonja, Relative of a Director Mrs. Jalpa N. Shah, Relative of a Director Ms. Vidhi Shah, Relative of a Director

Mr. Chandulal Shah, Relative of a Director (up to 18-01-2012)

Mrs. Indumati Shah, Relative of a Director

The estimates of salary escalation considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factor such as demand and supply of employees

b) Defined Contribution Plans:

The amount recognized as expenses and included in "Contribution to gratuity, provident and other funds" in Note 18 is Rs.10.41 lacs (Previous year Rs.8.91 lacs).

c) General Description of significant defined benefit plan Gratuity Plan : Gratuity is payable to all eligible employees of the Company in terms of the provision of the Payment of Gratuity Act,1972

5 The Company has taken office premises under operating lease at various locations. These agreements provide an option to the Company to renew the lease period on mutually agreeable terms. The Company has given refundable interest free security deposits in accordance with the agreed terms.

The rental expense in respect of the operating leases, recognized in the Statement of Profit and Loss as "Rent" in Note "20" is Rs. 51.00 lacs (previous year Rs.51.30 lacs)

6 Contingent Liabilities and commitments (to the extent not provided for)

a) Fixed deposits of the Company pledged with a bank for overdraft facility of a subsidiary Rs.1,125.42 lacs (Previous year Nil)

b) Guarantee given by the banks on behalf of Fortune Group in respect of capital adequacy, daily margin and other contractual commitments for capital market operations of its Subsidiaries Rs.5,548.75 lacs (Previous year Rs.5,008.78 lacs)

c) Estimated amount of contracts remaining to be executed on capital account Nil (Previous year Nil)

7 Under Micro, Small and Medium Enterprises Development Act, 2006 which came into force from October 2, 2006, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. The Company has not yet commenced the process of compiling the relevant information from its suppliers about their coverage under the said Act and hence the relevant disclosures have not been made in the accounts. However, in the view of the Management, there is no possibility of any interest being payable to any supplier as the Company is prompt in making payments to its suppliers.

8 In the opinion of Management, the value of all Current Assets, Loans and Advances and other receivables is not less than their realisable value in the ordinary course of business.

9 Balances standing in debtors, creditors and loan and advances are subject to confirmation.

10 Previous year's figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year's classification.

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Mar 31, 2011

1. Segment wise reporting

The Company is primarily engaged in the business of Investment and Merchant Banking activities. All the activities of the Company revolve around the main business. Further, the Company does not have any separate geographic segment other than India. As such there are no separate reportable segments as per Accounting Standard 17 on "Segment Reporting" (AS-17) issued by the Institute of Chartered Accountants of India.

2. Related Party Transaction

Details of the related parties with whom transactions were carried out during the year alongwith a description of the relationship and the amounts involved are provided below.

a) Name of the Related parties

i) Related Parties where control exists (Subsidiary Companies) Fortune Equity Brokers (India) Limited Fortune Commodities & Derivatives (India) Limited Fortune Credit Capital Limited Fortune Financial India Insurance Brokers Limited

ii) Other related parties

Enterprises having significant influence

Mehra Capital Services Private Limited

Umrigar Investment Pvt. Ltd

Fortune Capital Services J T Poonja (HUF)

Nimish C. Shah (HUF)

iii) Key management personnel and their relatives:

Mr. J.T. Poonja, Executive Chairman

Mr. Nimish C. Shah, Managing Director

Mrs. Sangeeta Poonja, Director

Mr. Abhinay Poonja, Relative of a Director

Ms. Aparna Poonja, Relative of a Director

Mrs. Jalpa N. Shah, Relative of a Director

Ms. Vidhi Shah, Relative of a Director

Mr. Chandulal Shah, Relative of a Director

Mrs. Indumati Shah, Relative of a Director

(vi) The estimates of salary escalation considered in actuarial revaluation takes into account inflation, seniority, promotion and other relevant factors such as demand and supply of employee.

(b) Defined Contribution Plans

The amount recognised as expense and included in Schedule 'N' under the head "Contribution to provident and other funds" of the Profit and Loss Account is Rs. 8.91 lacs (Previous year Rs. 3.06 lacs).

(c) General Description of significant defined benefit plan

Gratuity Plan: Gratuity is payable to all eligible employees of the Company in terms of the provisions of the Payment of Gratuity Act, 1972.

3. a. The Company has taken office premises under operating leases at various locations. These agreements provide an option to the Company to renew the lease period on mutually agreeable terms. The Company has given refundable interest free security deposits in accordance with the agreed terms.

b. The rental expense in respect of the operating leases, recognised in the Profit and Loss Account as "Rent" in Schedule "O" is Rs. 51.30 lacs (previous year Rs. 54.15 lacs)

4. The company has allotted 400,000 equity warrants of Rs.10 each at Rs. 180 per warrant (previous year 600,000 equity warrants of Rs. 10 each at Rs. 80 per warrant) convertible in one equity share of Rs. 10 each per warrant on a preferential basis to its promoters. In accordance with the terms of the issue, the holders of such warrants shall have an option to apply for one equity share of Rs.10 each at any time within a period of eighteen months from the date of issue. Accordingly, 600,000 & 400,000 warrants are due for conversion on or before August 4 2011 and March 12 2012 respectively. As on March 31 2011 none of the allottees have exercised their option for conversion.

5. Employees Stock Option Plan ("ESOP")

The Employee Stock Option Plan provides that the Company's employees and those of its subsidiaries are granted an option to acquire equity shares of the Company. The options may be exercised with in a specified period.

The Company follows the intrinsic value method to account for its stock based compensation plans. Compensation cost is measured as the excess, if any of the fair market value of the underlying share over the exercise price.

6. Contingent Liabilities

(Rupees in lacs)

Particulars March 31 2011 March 31 2010

Guarantee given by the banks on behalf of 5,008.75 3,708.75 Fortune Group in respect of capital adequacy, daily margin and other contractual commitments for capital market operations of its Subsidiaries

7. Estimated amount of contracts remaining to be executed on capital account Nil (Previous year Rs.23.98 lacs)

8. a. Section 115-O of the Income Tax Act, 1961 provides for calculation of dividend distribution tax liability of the holding company after permitting reduction of dividend received from its subsidiaries. In view of this, there is no tax on dividend distribution by the Company.

b. The amount of proposed equity dividend includes Rs.1.80 lacs on account of dividend for the year 2009-2010 on equity shares issued pursuant to Employee Stock Option Scheme of the company.

9. Under Micro, Small and Medium Enterprises Development Act, 2006 which came into force from October 2 2006, certain disclosures are required to be made relating to Micro, Small & Medium Enterprises. The Company has not yet commenced the process of compiling information from its suppliers about their coverage under the said Act and hence the relevant disclosures have not been made in the accounts. However, in the view of the Management, there is no possibility of any interest being payable to any supplier as the Company is prompt in making payments of its dues.

10. In the opinion of management, the value of all current assets, loans and advances and other receivables is not less than their realisable value in the ordinary course of business.

11. Balances standing in debtors, creditors and loans and advances are subject to confirmations.

12. Previous year's figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year's classification.

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Mar 31, 2010

1. Segment wise reporting

The Company is primarily engaged in the business of Investment and Merchant Banking activities. All the activities of the Company revolve around the main business. Further, the Company does not have any separate geographic segments other than India. As such there are no separate reportable segments as per Accounting Standard 1 7 on "Segment Reporting" (AS-1 7) issued by the Institute of Chartered Accountants of India.

2. As per Accounting Standard 18 issued by The Institute of Chartered Accountants of India, the related parties with whom the Company has entered into transactions during the year in the ordinary course of business, as certified by the Management are disclosed below:

I) Disclosures in respect of Related Parties :

a) Related parties where control exists:

Subsidiary Companies

Fortune Equity Brokers (India) Limited

Fortune Commodities & Derivatives (India) Limited

Fortune Credit Capital Limited

Fortune Financial India Insurance Brokers Limited

b) Other related parties

i) Enterprises having significant influence :

Mehra Capital Services Private Limited

Umrigar Investment Pvt. Ltd

Fortune Capital Services

J T Poonja ( HUF)

NimishC.Shah(HUF)

ii) Key management personnel and their relatives:

Mr. J.T. Poonja, Executive Chairman

Mr. Nimish C. Shah, Managing Director Ms. Sangeeta Poonja, Director

Mr. Abhinay Poonja, Relative of a Director

Ms. Aparna Poonja, Relative of a Director

Mrs. Jalpa N. Shah, Relative of a Director

Ms. Vidhi Shah, Relative of a Director

Mr. Chandulal Shah, Relative of a Director

Mrs. Indumati Shah, Relative of a Director

3. a. The Company has taken office premises under operating lease at various locations. These agreements provide an option to the Company to renew the lease period on mutually agreeable terms. The Company has given refundable interest free security deposits in accordance with the agreed terms.

b. The rental expense in respect of the operating lease, recognised in the Profit and Loss Account as "Rent" in Schedule "P" is Rs.54.15 Lacs (previous year Rs.48.65 Lacs)

4. The Company has allotted 600,000 equity warrants of Rs.10 each at Rs. 80 per warrant (previous year 4,00,000 equity warrants at Rs. 220/- per warrant) on a preferential basis to its promoters during the year. In accordance with the terms of the issue, the holders of such warrants shall have an option to apply for one equity share of Rs.10 each at any time within a period of eighteen months from the date of allotment, (i.e. not later than August 4 2011). No options have been exercised till, March 31 2010.

5. 400,000 equity warrants of Rs.10 each issued on preferential basis to its promoters on July 5 2008, lapsed during the year due to non-exercise of options by the warrant holders. The amount received on the above equity warrants amounting to Rs. 88 Lacs, has been forfeited by the Company and credited to Capital Reserve.

6. Employees Stock Option Plan ("ESOP")

The Employee Stock Option Plan provides that the Companys employees and those of its subsidiaries are granted an option to acquire equity shares of the Company. The options may be exercised within a specified period.

The Company follows the intrinsic value method to account for its stock based compensation plans. Compensation cost is measured as the excess, if any of the fair market value of the underlying share over the exercise price.

7. Contingent Liabilities

(Rupees in Lacs)

Particulars 2009-2010 2008-2009

Corporate counter guarantee given by the Company 3,708.75 2,428.75

for the credit facilities availed by Subsidiary Companies

8. Disclosure as per clause 32 of the Listing Agreement

Loans and Advances in the nature of loans given to subsidiary companies:

9. Estimated amount of Contracts remaining to be executed on Capital Account Rs. 23.98 Lacs (Previous Year Rs. Nil)

10. Section 115-Oofthe Income Tax, 1961 Act provides for calculation of dividend distribution tax liability of the holding company after permitting reduction of dividend received from its subsidiaries. In view of this, there is no tax on dividend distribution by the Company.

11. Under Micro, Small and Medium Enterprises Development Act, 2006 which came into force from October 2, 2006, certain disclosures are required to be made relating to Micro, Small & Medium Enterprises. The Company has not yet commenced the process of compiling the relevant information from its suppliers about their coverage under the said Act and hence the relevant disclosures have not been made in the accounts. However, in the view of the Management, there is no possibility of any interest being payable to any supplier as the Company is prompt in making payments to its suppliers.

12. In the opinion of Management, the value of all Current Assets, Loans and Advances and other receivables is not less than their realisable value in the ordinary course of business.

13. Balances standing in debtors, creditors and loans and advances are subject to confirmation.

14. Previous years figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current years classification.

Notes:

1. Cash flow statement has been prepared under the indirect method as set out in the Accounting Standard (AS) 3: "Cash Flow Statements" as specified in the Companies (Accounting Standards) Rules, 2006.

2. Previous years figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current years classification.