Home  »  Company  »  Future Consumer  »  Quotes  »  Notes to Account
Enter the first few characters of Company and click 'Go'

Notes to Accounts of Future Consumer Ltd.

Mar 31, 2017

1 Financial Instruments and Risk Review

2. Capital Management

The Company manages its capital to ensure that company will be able to continue as going concern while maximizing the return to shareholders by striking a balance between debt and equity. The capital structure of the Company consists of net debt (offset by cash and bank balances) and equity of the Company (comprising issued capital, reserves, retained earnings). The Company is not subject to any externally imposed capital requirements except financial covenants agreed with lenders.

In order to optimize capital allocation, the review of capital employed is done considering the amount of capital required to fund capacity expansion, increased working capital commensurate with increase in size of business and also fund investments in new ventures which will drive future growth. The Chief Financial officer (“CFO”) reviews the capital structure of the Company on a regular basis. As part of this review, the CFO considers the cost of capital and the risks associated with each class of capital. The Company has a target Debt to Equity ratio of 1:1 determined as the proportion of net debt to equity. The Debt to Equity ratio at 31st March 2017 was 0.32 : 1

* includes current maturity of long term borrowings

At the end of the reporting period, there are no significant concentrations of credit risk for financial assets measured at FVTPL. The carrying amount reflected above represents the Company’s maximum exposure to credit risk for such financial assets.

3. Financial risk management objectives

The Company has a Risk Management Committee instituted by its Board of Directors for overseeing the Risk Management Framework and developing and monitoring the Company’s risk management policies. The risk management policies are established to ensure timely identification and evaluation of risks, setting acceptable risk thresholds, identifying and mapping controls against these risks, monitor the risks and their limits, improve risk awareness and transparency. Risk management policies and systems are reviewed regularly to reflect changes in the market conditions and the Company’s activities to provide reliable information to the Management and the Board to evaluate the adequacy of the risk management framework in relation to the risk faced by the Company.

4 Market Risks

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in the market prices. The Company is exposed in the ordinary course of its business to risks related to changes in foreign currency exchange rates, interest rates and other price risk.

The Company seeks to minimize the effects of these risks by using derivative financial instruments to hedge risk exposures. The use of financial derivatives is governed by the Company’s policies approved by the Board of Directors, which provide principles on foreign exchange risk and interest rate risk. Compliance with policies and exposure limits is reviewed by the Management and the internal auditors on a continuous basis. The Company does not enter into or trade financial instruments, including derivatives for speculative purposes.

5 Foreign Currency Risk Management

The Company’s exposure in foreign currencies is limited, however it is exposed to foreign exchange risks arising from some import of goods and services. Foreign exchange risks arises from recognized assets and liabilities, when they are denominated in a currency other than Indian Rupee.

To manage the foreign exchange risk arising from recognized assets and liabilities, the Company uses spot transactions, foreign exchange forward contracts, according to the Company’s foreign exchange risk policy. Corporate Treasury is responsible for managing the net position in each foreign currency and for putting in place the appropriate hedging actions.

Foreign exchange risk sensitivity:

10% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 10% change in foreign currency rates. The sensitivity analysis includes external loans as well as loans to foreign operations within the Group where the denomination of the loan is in a currency other than the functional currency of the lender or the borrower.

A positive number below indicates an increase in profit and negative number below indicates a decrease in profit. Following is the analysis of change in profit where the Indian Rupee strengthens and weakens by 10% against the relevant currency:

6 Interest rate risk

Inerest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk because funds are borrowed at both fixed and floating interest rates. Interest rate risk is measured by using the cash flow sensitivity for changes in variable interest rate. The borrowings of the Company are principally denominated in rupees and US dollars with a mix of fixed and floating rates of interest. The Company hedges its US dollar interest rate risk through interest rate swaps to reduce the floating interest rate risk. The Company has exposure to interest rate risk, arising principally on changes in base lending rate and LIBOR rates.

Interest rate risk sensitivity:

The sensitivity analysis below have been determined based on the exposure to interest rates for both derivatives and no derivative instruments at the end of the reporting period. For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. A 50 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates.

.7 Other price risks

The Company exposure to other risks arises from investments in preference shares and debentures amounting to Rs, 1,916.33 lakhs (Previous Year Rs, 1,311.70 lakhs). The investments are held for strategic rather than trading purpose.

The sensitivity analysis below have been determined based on the exposure to price risk at the end of the reporting period. If the prices of the above instruments had been 5% higher/lower, profit for the year ended 31st March 2017 would increase/decrease by Rs, 95.82 lakhs (Previous year by Rs, 65.59 lakhs).

8 Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. Credit risk arises from entering into derivative financial instruments and from deposits with banks and financial institutions, as well as from credit exposures to customers, including outstanding receivables.

The Company has adopted a policy of only dealing with creditworthy counterparties. Detailed KYC documentation is done before the transaction is done with the customers. Also, majority of the Company’s sales is to other Future Group Companies, hence the risk of realization of sales money is minimised. The Company’s exposures are continuously monitored. Credit exposure is controlled by counterparty limits that are reviewed and approved annually. Ongoing credit evaluation is performed on the financial condition of accounts receivable. Also periodic reconciliation is being done with the customers. There is no history of bad debts suffered by the company.

Apart from Future Retail Limited, the largest customer of the company, the Company does not have significant credit risk exposure to any single counterparty. Concentration of credit risk related to Future Retail Limited did not exceed 84% (Previous Year 77%) of gross trade receivable as at the end of reporting period. No other single customer accounted for more than 10% of total trade receivable. The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are banks with high credit-ratings assigned by international credit-rating agencies. The Company does not hold any collateral or other credit enhancements to cover its credit risks associated with its financial assets.

The average credit period on sales of goods is 7 to 90 days. No interest is charged on trade receivables.

In determining the allowances for doubtful trade receivables, the Company has used a practical expedient by computing the expected credit loss allowance for trade receivables. It takes into account historical credit loss experience and is adjusted for forward looking information. The expected credit loss allowance is based on the ageing of the past due receivables. There has been no significant change in the credit quality of receivables past due for more than 180 days.

9 Liquidity risk

Ultimate responsibility for liquidity risk management rests with the board of directors. There is an established liquidity risk management framework for the management of the Company’s (a) short term, (b) medium term (c) long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

Liquidity and interest risk tables

The following tables detail the Company’s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay. The tables include both interest and principal cash flows. To the extent that interest flows are floating rate, the undiscounted amount is derived by reference to the conditions existing at the end of the reporting period.

“The amounts included above for financial guarantee contracts are the maximum amounts the Company could be forced to settle under the arrangement for the full guaranteed amount if that amount is claimed by the counterparty to the guarantee. Based on expectations at the end of the reporting period, the Company considers that it is more likely than not that such an amount will not be payable under the arrangement. However, this estimate is subject to change depending on the probability of the counterparty claiming under the guarantee which is a function of the likelihood that the financial receivables held by the counterparty which are guaranteed suffer credit losses.

The Company has Rs, 10,298.45 lakhs (Previous Year Rs, 3,323.84 lakhs) undrawn facilities at its disposal to further reduce liquidity risks.

10 Fair Value Measurement and related disclosures

Fair value of the Company’s financial assets and financial liabilities that are measured at fair value on a recurring basis:

Some of the Company’s financial assets are measured at fair value at the end of each reporting period. The following table gives information about how the fair values of these financial assets and financial liabilities are determined (in particular, the valuation technique(s) and inputs used).

Financial assets and financial liabilities that are not measured at fair values (but fair values disclosures are required)

The Company considers that the carrying amounts of financial assets and financial liabilities recognized in the balance sheet approximate their fair values.

11. Share Based Payments

12. Details of the employee share based plan of the Company

a) The ESOP scheme titled “FVIL Employees Stock Option Plan 2011” (ESOP 2011) was approved by the shareholders at the Annual General Meeting held on 10th August 2010. 50,000,000 options are covered under the ESOP 2011 for 50,000,000 shares. Post listing of equity shares on the stock exchanges, the Shareholders have ratified the pre-IPO scheme.

In the previous years, the Nomination and Remuneration / Compensation Committee of the Company has granted 34,535,000 options under ESOP 2011 to certain directors and employees of the Company and some of its Subsidiaries. The options allotted under ESOP 2011 are convertible into equal number of equity shares. The exercise price of each option is Rs, 6/-.

The options granted vest over a period of 3 years from the date of the grant in proportions specified in the Scheme. Options may be exercised within 3 years from date of vesting.

b) The ESOP scheme titled “Future Consumer Enterprise Limited - Employee Stock Option Plan 2014” was approved by the Shareholders vide resolution passed at the Extra Ordinary General Meeting held on 12th January, 2015 and through postal ballot on 12th May 2015 in respect of grant of 31,950,000 options under primary route (ESOP 2014-Primary) and 79,800,000 options under secondary market route (ESOP 2014-Secondary). ESOP

2014 has been implemented through a trust route whereby Vistra ITCL India Limited (Formerly IL&FS Trust Company Limited) has been appointed as the Trustee who monitors and administers the operations of the Trust. In the previous year, the Nomination and Remuneration / Compensation Committee, at its meeting held on 15th May 2015, has granted 15,950,000 options under the ESOP 2014-Secondary to certain directors / employees of the Company and some of its Subsidiaries under the secondary market route. During the current year, the Nomination and Remuneration / Compensation Committee, at its meeting held on 12th August 2016 has granted 10,000,000 options under the ESOP 2014-Primary to certain directors / employees of the Company and some of its Subsidiaries under the primary route. The options allotted under ESOP 2014 are convertible into equal number of equity shares. The exercise price per Option for shares granted under the secondary market route shall not exceed market price of the Equity Share of the Company as on date of grant of Option or the cost of acquisition of such equity shares to the Trust applying FIFO basis, whichever is higher. The exercise price per Option for shares granted under the primary route shall not exceed market price of the Equity Share of the Company as on date of grant of Option, which may be decided by the Nomination and Remuneration / Compensation Committee.

The options granted vest over a period of 3 years from the date of the grant in proportions specified in the Scheme. Options may be exercised within 3 years from date of vesting.

The following share-based payment arrangements were in existence during the current and prior years:

Note-1 The options granted vest over a period of 3 years from the date of the grant in proportions specified in the Scheme. Options may be exercised within 3 years from date of vesting.

Note-2 Market price of the Equity Share of the Company as on date of grant of Option or the cost of acquisition of such shares to the Company applying FIFO basis, whichever is higher.

13. Options were priced using a Black Scholes option pricing model. Expected volatility is based on the historical share price volatility over the past 1 year.

14. Related Party Disclosures

15. Names of Related Parties and Nature of Relationship

a. Subsidiary Companies

Aadhaar Wholesale Trading and Distribution Limited Future Food and Products Limited Future Consumer Products Limited Future Food Processing Private Limited

(Formerly known as Future Personal Care and Hygiene Products Private Limited) Star and Sitara Wellness Limited Express Retail Services Private Limited FCEL Overseas FZCO

FCEL Food Processors Limited (formerly known as ACK Edutainment Limited)

The Nilgiri Dairy Farm Private Limited

Appu Nutritions Private Limited

Nilgiri’s Mechanised Bakery Private Limited

Nilgiris Franchise Private Limited

Integrated Food Park Private Limited

Bloom Fruit and Vegetables Private Limited

b. Associate

Sarjena Foods Private Limited

c. Joint Ventures

Mibelle Future Consumer Products AG

Amar Chitra Katha Private Limited

ACK Media Direct Limited

IBH Books & Magazines Distributors Limited

Aussee Oats India Private Limited

Ideas Box Entertainment Limited

Aussee Oats Milling (Private) Limited

MNS Foods Private Limited

Genoa Rice Mills Private Limited

Avante Snack Foods Private Limited

Sublime Foods Private Limited

d. Key Management Personnel (KMP) and their relatives Kishore Biyani

Ashni Biyani

Narendra Baheti (With effect from 30th August 2016)

Rajendra Baheti (With effect from 30th August 2016)

Arun Kumar Agarwal ( Upto 4th February 2017)

Archana Baheti (With effect from 30th August 2016)

Sunder Devi Baheti (With effect from 30th August 2016)

Amulya Baheti (With effect from 30th August 2016)

Rajkumari Agarwal (Upto 4th February 2017)

e. Entities which have significant influence over the Company Future Corporate Resources Limited (Upto 30th March 2017)

Weavette Business Ventures Limited (upto 30th March 2017)

Birthright Games & Entertainment Private Limited (upto 30th March 2017)

f. Entities controlled by KMP and their relatives Premium Harvest Limited

Future Ideas Company Limited

16. During the previous year, pursuant to approval granted by the Shareholders of the Company at an Extra Ordinary General Meeting held on 22nd January 2016, the Committee of Directors of the Board of Directors of the Company had on 5th February 2016 issued and allotted 6,700 Warrants of '' 100,000/- each to Srishti Mall Management Company Private Limited (“Srishti”), a promoter group company, on preferential allotment basis upon receipt of '' 1,675 lakhs from Srishti being 25% of the total consideration price for the warrants. The warrant holder may exercise the warrants at any time before expiry of 18 months from the date of allotment of warrants. Upon such exercise and on payment of balance 75% of the total consideration amount by the warrant holder, the warrants shall be converted into equity shares at a conversion price of '' 22.73 per equity share.

In the event the warrant holder does not exercise the Warrants within the staid period, the warrants shall lapse and the amount paid shall stand forfeited by the Company.

17. During the previous year, the Company had re-aligned its business by way of shifting the operations of convenience stores to be undertaken under a Franchisee model. Under the new model all the convenience stores which earlier were operated by the Company and/or its subsidiaries under various format brands “KB’s Fair Price”, “KB’s Conveniently Yours”, “Big Apple”, “Aadhaar” and “Nilgiris” are now operated by the franchisee appointed by the Company. As a result of the above, the Company does not operate any convenience stores either directly by itself or by any of the above mentioned subsidiaries.

18. Addition to Capital Work in Progress during the year includes borrowing cost amounting to Rs, 270.98 lakhs (Previous Year Rs, 81.30 lakhs)

KBFP CGU represents convenience store chain KB’s Fairprice and Big Apple. These stores were mainly operated in Delhi, Mumbai and Bangalore. These store formats are typically located in close proximity of customers in easy accessible locations . These stores are designed as low frills stores, the business model hinges on low operating as well as low capex costs and high turns for the goods sold within the stores.

Center of Plate (COP) CGU is into the business of procuring, processing and supplying agricultural commodities in loose and packed form under various brands.

Goodwill

The recoverable amount of Goodwill is determined based on a value in use calculation which uses cash flow projections based on financial budgets approved by the management covering a five-year period, and a discount rate of 16.36% per annum respectively. Cash flow projections during the budget period are based on the same expected gross margins and raw materials price inflation throughout the budget period. The cash flows beyond that five-year period have been extrapolated using a steady 5% per annum growth rate (for all CGU and Subsidiaries) which is the projected long-term average growth rate for the industry. The management believes that any reasonably possible change in the key assumptions on which recoverable amount is based would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of the cash-generating unit.

As at transition date, the Company carried out a review of the recoverable amount of KBFP CGU as mandated under Ind-AS 101. The review led to the recognition of an impairment loss in Goodwill of Rs, 7,352.51 lakhs which has been recognized in retained earnings. The recoverable amount of the relevant assets has been determined on the basis of their value in use, which amounted to Rs, 614.50 lakhs as at 1st April 2015. The discount rate used in measuring value in use was 14% per annum. No impairment assessment under previous GAAP was performed in 2014-2015 as there was no indication of impairment. The business was relatively new with a long gestation period.

19. Brand Kara is considered to have indefinite useful life based on the management assessment that the same will continue to generate future cash flows for the Company indefinitely. The recoverable amount is Rs, 1,209 lakhs (Previous Year : Rs, 1,209 lakhs). The recoverable amount of brand “Kara” is determined based on a value in use calculation which uses cash flow projections based on financial budgets approved by the management covering a five-year period, and a discount rate of 17% per annum respectively. Cash flow projections during the budget period are based on the same expected gross margins and raw materials price inflation throughout the budget period. The cash flows beyond that five-year period have been extrapolated using a steady 5% per annum growth rate which is the projected long-term average growth rate for the industry. The directors believe that any reasonably possible change in the key assumptions on which recoverable amount is based would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of the brand.

20. During the previous year, pursuant to approval granted by the Shareholders of the Company at an Extra Ordinary General Meeting held on 22nd January 2016, the Company had on 26th April 2016 issued and allotted 100 Equity Shares of Rs, 6 each at a premium of Rs, 16.73 per equity share and 29,985 CCDs of Rs, 100,000/- each to Black River Food 2 Pte. Limited (“Black River”) upon receipt of Rs, 29,985.02 lakhs, on preferential allotment basis.

The CCDs carry a coupon of 8.50% per annum compounded on a quarterly basis. The CCDs shall automatically and compulsorily be converted into equity shares at a conversion price of Rs, 22.73 per equity share on the earlier of occurrence of following events - a) Black River electing to convert the CCDs into equity shares and b) the date that is 18 months from the date of issue of CCDs. In the event of unpaid coupons, if any, the Investor shall be entitled to such number of equity shares, equivalent to the amount of coupons remaining unpaid at a conversion price of Rs, 22.73 for each equity share.

21. Pursuant to approval granted by the Shareholders of the Company at an Extra Ordinary General Meeting held on 17th June 2016, the Company has on 2nd July 2016 issued and allotted 100 Equity Shares of Rs, 6 each at a premium of Rs, 16.73 per equity share and 13,400 CCDs of Rs, 100,000/- each to International Finance Corporation (“IFC”) upon receipt of an aggregate amount of Rs, 13,400.02 lakhs, on preferential allotment basis.

The CCDs shall carry a coupon of 8.50% per annum compounded quarterly on a cumulative basis from the date of allotment. The CCDs shall be converted into equity shares of the Company at a conversion price of Rs, 22.73 per equity share on the earlier of following events (i) IFC electing to convert the CCDs into equity sharers by issuing a conversion notice to the Company; and (ii) the last date falling within 18 months from the allotment of CCDs. In the event of unpaid coupons, if any, IFC shall be entitled to such number of equity shares, equivalent to the amount of coupons remaining unpaid, at a conversion price of Rs, 22.73 for each equity share.

Capital Reserve arose in the acquisition of KARA amounting to Rs, 314.94 lakhs which has directly been recognized in Equity. The consideration paid for the combination effectively included amounts in relation to the benefit of expected synergies, revenue growth, future market development and the assembled workforce.

No Cash and cash equivalent has been obtained under this acquisition. Acquisition-related costs amounting to Rs, 88.42 lakhs have been excluded from the consideration transferred and have been recognized as an expense in statement of profit or loss in the year of acquisition, within the ‘Other expenses’ line item.

Revenue for the year 31st March 2016 includes Rs, 1,215 lakhs in respect of business acquired. Profit for the year in respect of business acquired cannot be ascertained separately as this being a division, no separate books of accounts are maintained.

Had these business combinations been effected at 1st April 2015, the revenue of the Company from continuing operations for year ended 31st March 2016 would have been Rs, 134,408.03 lakhs. The Company considers these ‘pro-forma’ numbers to represent an approximate measure of the performance of the combined Company on an annualized basis and to provide a reference point for comparison in future periods.

22. Particulars of loans given/ investments made/ guarantees given as required by clause (4) of Section 186 of the Companies Act, 2013

23. Approval of Financial Statements

The Financial Statements were approved for issue by the Board of Directors on 26th May 2017 .

24. First Time Ind AS Adoption Reconciliation

Notes

A. Under previous GAAP, long term investments were measured at cost less diminution in value which is other than temporary. Under Ind AS certain financial assets (preference shares and optionally convertible debentures) are measured at fair value through statement of profit or loss which has resulted into a reduction of equity by Rs, 4,423.27 lakhs as at transition date.

The Company have considered fair value of Investment in a Joint venture as deemed cost on transition date. This has resulted in reduction of equity by Rs, 2,751.44 lakhs as at transition date. The aggregate deemed cost of those investments for which deemed cost is their previous GAAP carrying amount is Rs, 48,165.11 lakhs and aggregate deemed cost of those investments for which deemed cost is their fair value is Rs, 6,390.00 lakhs as at transition date.

B. Under previous GAAP, there was no accounting for fair value of financial guarantees given. Under Ind AS the financial guarantees given on behalf of subsidiaries, Joint ventures and associates are fair valued on the date on giving the guarantee and subsequently unwound over the period of guarantee given.

C. Under previous GAAP, the cost of Employee Stock Option Scheme was recognized using the intrinsic value method. Under Ind AS the same is recognized based on fair value of the options as on the grant date and amortized over vesting period. Cost of employee stock option given to employees of subsidiaries of the Company is accounted as deemed investment under Ind AS.

D. Under previous GAAP, interest expense was recognized based on contractual rate and fund raising expenses was charged off in statement of Profit or Loss when incurred. Under Ind AS interest is charged based on Effective Interest Rate method.

E. Under Ind AS assets acquired and liabilities assumed are measured at fair value as on acquisition date (Refer Note no 47). Expenses related business acquisition are charged to statement of profit or loss in the period it occurs.

F. In accordance with Ind AS 101, the Company has elected to measure certain items of PPE at fair value as at transition date. This fair values are considered as deemed cost. All other assets are measured as per Ind AS

25. This resulted in increase in deemed cost of land by Rs, 121.10 lakhs and decrease in deemed cost of other Property, plant and Equipment by Rs, 1,564.27 lakhs as at transition date. Goodwill has been tested for impairment in accordance with Ind AS 101 and an impairment loss of Rs, 7,352.51 lakhs has been recognized as at transition date. Under previous GAAP, Goodwill and brands was amortized based on estimated useful life. Under Ind AS Goodwill and brand having indefinite useful life is tested for impairment on transition date as well as subsequent balance sheet date. Certain items of PPE has been fair valued under Ind AS on transition date. Depreciation is provided accordingly. The same has resulted in decrease of depreciation/amortisation expenses by Rs, 1,735.79 lakhs for previous year.

G. Shares acquired by trust under employee share based option plan are accounted as treasury shares.

Notes:

a) Shares acquired by trust (Net) amounting to Rs, 2,028.85 lakhs under employee share based option plan are accounted as treasury shares and reflects in Net cash flow from financing activities. In previous GAAP the same was reflected as increase/decrease in advance under Net cash flows from operating activities.

b) Expenses related to business combination amounting to Rs, 88.42 lakhs was capitalized under previous GAAP and reflected in Net cash flows from investing activities. The same has been charged to statement of profit or loss under Ind AS.

c) Bank Balances not considered in Cash and Cash equivalents (net) amounting to Rs, 150.03 lakhs was reflected in Net cash flows from investing activities under previous GAAP. The same has been considered in working capital changes under Ind AS.


Mar 31, 2016

1. Corporate Information

The Company was incorporated on July 10, 1996, under the name "Subhikshith Finance and Investments Limited". The name of the Company was changed to "Future Ventures India Private Limited" with effect from August 09, 2007 and became a Public Limited Company with effect from September 07, 2007 as "Future Ventures India Limited".

The shares of the Company are listed on the National Stock Exchange Limited and BSE Limited since May 10, 2011. The name of the Company was changed to Future Consumer Enterprise Limited w.e.f. September 30, 2013. The Company is engaged in the business of Sourcing, Manufacturing, Branding, Marketing and Distribution of FMCG, Food and Processed Food Products in Urban and Rural India.

The Reserve Bank of India in terms of application made by the Company has vide its order passed on 21st July, 2015 cancelled Certificate of Registration granted to the Company. Consequently, the Company now ceases to be a Non Banking Financial Company.

2. The Company has recognised an amount of Rs.233.37 lakhs (Previous Year Rs.217.01 lakhs) for Provident Fund contributions and Rs.70.20 lakhs (Previous Year Rs.80.84 lakhs) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss.

3. Employee Stock Option Plan

a) The ESOP scheme titled "FVIL Employees Stock Option Plan 2011" (ESOP 2011) was approved by the shareholders at the Annual General Meeting held on August 10, 2010. 5,00,00,000 options are covered under the ESOP 2011 for 5,00,00,000 shares. Post listing of equity shares on the stock exchanges, the Shareholders have ratified the pre-IPO scheme.

In the previous years, the Nomination and Remuneration / Compensation Committee of the Company had granted 1,95,35,000 options under the ESOP 2011 to certain directors and employees of the Company and some of its Subsidiaries. During the current year, the Nomination and Remuneration / Compensation Committee at its meeting held on 26th December 2015 has granted 1,50,00,000 options under the ESOP 2011 to certain directors / employees of the Company and some of its Subsidiaries. The options allotted under ESOP 2011 are convertible into equal number of equity shares. The exercise price of each option is Rs.6/-.

The options granted vest over a period of 3 years from the date of the grant in proportions specified in the Scheme. Options may be exercised within 3 years from date of vesting.

b) The ESOP scheme titled "Future Consumer Enterprise Limited - Employee Stock Option Plan 2014" (ESOP 2014) was approved by the Shareholders vide resolution passed at the Extra Ordinary General Meeting held on 12th January, 2015 and through postal ballot on May 12, 2015 in respect of grant of 3,19,50,000 options under primary route and 7,98,00,000 options under secondary market route. ESOP 2014 has been implemented through a trust route whereby IL&FS Trust Company Limited has been appointed as the Trustee who monitors and administers the operations of the Trust.

The Nomination and Remuneration / Compensation Committee at its meeting held on 15th May 2015 has granted 1,59,50,000 options under the ESOP 2014 to certain directors / employees of the Company and some of its Subsidiaries under the secondary market route. The options allotted under ESOP 2014 are convertible into equal number of equity shares. The exercise price per Option shall not exceed market price of the Equity Share of the Company as on date of grant of Option or the cost of acquisition of such equity shares to the Company applying FIFO basis, whichever is higher.

The options granted vest over a period of 3 years from the date of the grant in proportions specified in the Scheme. Options may be exercised within 3 years from date of vesting.

Stock Compensation Expense:

The employee compensation cost has been calculated using the intrinsic value method of accounting for Options issued under the Company''s Employee Stock Option Schemes. Since options are granted under graded vesting plan with only service conditions, the Company has recognised the share-based compensation cost on a straight-line basis over the requisite service period for the entire award as per para 42A of the ICAI Guidance on Accounting for Employee Share-based Payments. The employee compensation cost as per the intrinsic value method for the financial year 2015-16 is Rs.265.64 Lakhs (Previous Year Rs.Nil).

4. Segment Reporting

The Company is engaged in the business of Branding, Manufacturing, Processing, Selling and Distribution of "Consumer Products" which constitutes a single reporting segment. Hence there is no separate reportable segment under Accounting Standard on "Segment Reporting" (AS 17).

5. Earnings per Share

The Company has only one class of equity share, hence the Profit after Tax is used for computation of earnings per share without any adjustment.

6. Related Party Disclosures

A) Names of Related Parties and Nature of Relationship

a. Subsidiary Companies

a. Aadhaar Wholesale Trading and Distribution Limited

b. Future Consumer Products Limited

c. Future Food and Products Limited

d. Star and Sitara Wellness Limited

e. Amar Chitra Katha Private Limited and its subsidiaries:

i. IBH Books and Magazines Distributors Limited

ii. ACK Edutainment Limited

iii. ACK Media Direct Limited

iv. Karadi Tales Company Private Limited (upto 16th July, 2015 )

v. Ideas Box Entertainment Limited

f. Express Retail Services Private Limited

g. Future Food Processing Private Limited (Formerly known as Future Personal Care and Hygiene Products Private Limited)

h. Aussee Oats Milling (Private) Limited

i. Aussee Oats India Private Limited (w.e.f. 19th February, 2016)

j. The Nilgiri Dairy Farm Private Limited

i. Appu Nutritions Private Limited

ii. Nilgiri''s Mechanised Bakery Private Limited

iii. Nilgiris Franchise Private Limited

k. Sublime Foods Private Limited

l. Integrated Food Park Private Limited

m. Bloom Fruit and Vegetables Private Limited (w.e.f. 15th January, 2016)

n. MNS Foods Private Limited (w.e.f. 4th August, 2015)

o. FCEL Overseas FZE*

b. Associates

a. Sarjena Foods Private Limited

b. Karadi Path company Private Limited (Associate of Amar Chitra Katha Private Limited) (From 17th July, 2015 to 3rd October 2015)

c. Joint Ventures

a. Mibelle Future Consumer Products AG (w.e.f. 9th October, 2015)

d. Key Management Personnel (KMP)

a. Arun Kumar Agarwal - Manager

b. Ashni Biyani - Whole Time Director

e. Enterprises over which key management personnel can exercise control / significant influence (KMP has significant influence)

a. Future Ideas Company Limited

b. Future Enterprises Limited (Formerly known as Future Retail Limited)

c. Future Lifestyle Fashions Limited

d. Srishti Mall Management Company Private Limited

* Subsidiary by virtue of control through composition of Board

7. Details on derivative instruments and unhedged foreign currency exposures

a) The following derivative positions are open as at 31st March, 2016. These transactions have been undertaken to act as economic hedges for the Company''s exposures to various risks in foreign exchange markets and may / may not qualify or be designated as hedging instruments.

Cross Currency Interest rate swaps to hedge against fluctuations in interest rate changes and fluctuation in changes in exchange rate: No. of contracts: 2 (Previous Year : Nil)

b) The year-end foreign currency exposures are given below:

8. The estimated amount of contracts remaining to be executed on capital account as at 31st March 2016 is Rs.Nil. (Previous Year Rs.1,362.53 lakhs).

9. details of leasing arrangements:

The Company has entered into cancellable operating lease arrangement for its stores and office premises. Operating lease rentals charged to Statement of Profit and Loss aggregate to Rs.2,573.83 Lakhs (Previous year Rs.2,567.92 Lakhs.)

10. Certain subsidiaries of the Company have incurred losses resulting in erosion of their net- worth. These companies are in the process of building respective businesses/brands and creating substantial value. The management is fully committed to lead to profitability by providing the necessary financial support and mentoring. Therefore, in the opinion of the management, the diminutions in the value of the said investment are temporary in nature and consequently, no adjustment is considered necessary to the carrying value of investment.

11. Pursuant to approval granted by the Shareholders of the Company at an Extra Ordinary General Meeting held on 22nd January, 2016, the Committee of Directors of the Board of Directors of the Company had on 5th February, 2016 issued and allotted 6,700 Warrants of Rs.1,00,000/- each to Srishti Mall Management Company Private Limited ("Srishti"), a promoter group company, on preferential allotment basis upon receipt of Rs.1,675 lakhs from Srishti being 25% of the total consideration price for the warrants. The warrant holder may exercise the warrants at any time before expiry of 18 months from the date of allotment of warrants. Upon such exercise and on payment of balance 75% of the total consideration amount by the warrant holder, the warrants shall be converted into equity shares at a conversion price of Rs.22.73 per equity share.

In the event the warrant holder does not exercise the Warrants within the said period, the warrants shall lapse and the amount paid shall stand forfeited by the Company.

12. The information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified based on information available with the Company.

13. During the year under review, the Company has re-aligned its business by way of shifting the operations of convenience stores to be undertaken under a Franchisee model. Under the new model all the convenience stores which earlier were operated by the Company and/or its subsidiaries under various format brands "KB''s Fair Price", "KB''s Conveniently Yours", "Big Apple", "Aadhaar" and "Nilgiris" will be operated by the franchisee appointed by the Company. As a result of the above, the Company shall not hereafter be operating any convenience stores either directly by itself or by any of the above mentioned subsidiaries.

14. Addition to Capital Work in Progress during the year includes borrowing cost - Rs.81.30 Lakhs (Previous Year - Rs.Nil), adjustment on account of exchange rate fluctuation - Rs.0.78 Lakhs (Previous Year - Rs.Nil) and other expenditure in the course of construction of the assets - Rs.414.55 Lakhs (Previous Year - Rs.Nil). Foreign exchange fluctuation included above remaining to be amortised is Rs.0.78 Lakhs (Previous Year - Rs.Nil).

Addition to Plant & Machinery includes borrowing cost amounting to Rs.14.39 Lakhs. (Previous Year - Rs.Nil).

15. The Company has interest in the following Joint venture Entity:

16. Pursuant to approval granted by the Shareholders of the Company at an Extra Ordinary General Meeting held on January 22, 2016, the Company has on April 26, 2016 issued and allotted 100 Equity Shares of Rs.6 each at a premium of Rs.16.73 per equity share and 29,985 CCDs of Rs.1,00,000/- each to Black River Food 2 Pte. Ltd ("Black River") upon receipt of Rs.29,985.02 Lakhs on preferential allotment basis.

The CCDs shall carry a coupon of 8.50% per annum compounded on a quarterly basis. The CCDs shall automatically and compulsorily be converted into equity shares at a conversion price of Rs.22.73 per equity share on the earlier of occurrence of following events - a) Black River electing to convert the CCDs into equity shares and b) the date that is 18 months from the date of issue of CCDs. In the event of unpaid coupons, if any, the Investor shall be entitled to such number of equity shares, equivalent to the amount of coupons remaining unpaid at a conversion price of Rs.22.73 for each equity share.

17. Particulars of loans given \ investments made \ guarantees given, as required by clause (4) of Section 186 of the Companies Act, 2013

Figures in bracket represent previous year''s figures.

18. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure. Pursuant to shareholders'' approval, w.e.f. February 1, 2016, the Company has re-aligned its business by way of shifting the operations of convenience stores to be undertaken under a Franchisee model. Consequently, the figures for the current year are not comparable with that of the previous year.


Mar 31, 2015

1. CORPORATE INFORMATION

The Company was incorporated on July 10, 1996, under the name "Subhikshith Finance and Investments Limited" The name of the Company was changed to "Future Ventures India Private Limited" with effect from 9th August, 2007 and became a Public Limited Company with effect from September 7 2007 as "Future Ventures India Limited"

The shares of the Company are listed on the National Stock Exchange of India Limited and BSE Limited since May 10, 2011. Pursuant to a composite scheme of Amalgamation and Arrangement coming into effect during the financial year 2012-13, the Company has become an operating entity from being a Non-Banking Finance Company "(NBFC") since it was unable to satisfy the prescribed norms of assets / income pattern as required under the Reserve Bank of India regulations. In view of the same, the Company has made an application to Reserve Bank of India ("RBI") seeking de-registration as NBFC on May 30, 2013.

The name of the Company was changed to Future Consumer Enterprise Limited w.e.f. September 30, 2013. Consequent to the aforesaid, the Company is now engaged in the business of Sourcing, Branding, Marketing and Distribution of FMCG, Food and Processed Food Products in Urban and Rural India.

2.SHARE CAPITAL

Terms/Rights attached to Equity Shares:

The Company has only one class of equity shares having a face value of RS. 6 per share. Each holder of equity shares is entitled to one vote per share.

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

e) As at 31st March, 2015 in terms of FVIL Employees Stock Option Plan 2011 equity shares aggregating to 1,006,000 (Previous Year- 15,785,000 equity shares) were reserved for issuance towards outstanding Employee Stock Options granted. (Refer Note 29)

f) The Company has alloted 45,918,367 (Previous Year - NIL) equity shares of RS. 6 each fully paid up at a premium of RS. 6.74 per share on preferential basis without payment being received in cash to the minority shareholders of Aadhaar Wholesale Trading and Distribution Limited (a subsidiary of the Company) for acquisition of their stake consequently Aadhaar Wholesale Trading and Distribution Limited has become as wholly owned subsidiary of the Company.

3. The Company has recognised an amount of " 21701 lakhs (Previous Year RS. 163.53 lakhs) for Provident Fund contributions and RS. 80.84 lakhs (Previous Year RS. 65.84 lakhs) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss.

4. EMPLOYEE STOCK OPTION PLAN

The Board at its meeting held on July 12, 2010, has approved issue of Stock Options up to a maximum of 50,000,000 Equity Shares, with a ceiling of upto 1% of the paid-up equity share capital in any financial year subject to the approval of the shareholders under Section 81 (1A) of the Companies Act, 1956. The options allotted under ESOP are convertible into equal number of equity shares.The Shareholders of the Company at the Annual General Meeting held on August 10, 2010 approved the afore-said issue of 50,000,000 stock options on Equity Shares under one or more Employee Stock Option Scheme(s). Post listing of the Equity Shares on the stock exchanges, the Shareholders have ratified the pre-IPO scheme. The Compensation and Nomination Committee has approved the following grants to certain directors and employees of the Company and some of its Subsidiaries in accordance with the FVIL Employees Stock Option Plan 2011 (ESOP Scheme):

Stock Compensation Expense:

The employee compensation cost has been calculated using the intrinsic value method of accounting for Options issued under the Company"s Employee Stock Option Schemes. The employee compensation cost as per the intrinsic value method for the financial year 2014-15 is Nil.

Fair Value Methodology

The fair value of Options used to compute proforma net profit and earnings per Equity Share have been estimated on the date of the grant using Black-Scholes model by an independent valuer.

5. SEGMENT REPORTING

The Company is engaged in Branding, Selling and Distribution of "Consumer products" which in terms of Accounting Standard 17 "Segment Reporting" constitute a single reporting segment. Hence, there is no separate reportable segment under Accounting Standard 17 "Segment Reporting"

6. RELATED PARTY DISCLOSURES

A. Names of Related Parties and Nature of Relationship

1. Subsidiary Companies

a. Aadhaar Wholesale Trading and Distribution Limited

b. Future Consumer Products Limited

c. Future Food and Products Limited

d. Star and Sitara Wellness Limited

e. Amar Chitra Katha Private Limited and its subsidiaries

i. IBH Books and Magazines Distributors Limited

ii. ACK Edutainment Limited

iii. ACK Media Direct Limited

iv. Karadi Tales Company Private Limited

v. Ideas Box Entertainment Limited

f. Express Retail Services Private Limited

g. Future Personal Care and Hygiene Private Limited (Formerly known as ACK Eaglemoss Collectibles Publishing Private Limited)

h. Aussee Oats Milling (Private) Limited (w.e.f. 16th Sept 2014)

i. The Nilgiri Dairy Farm Private Limited (w.e.f. 20th Nov 2014)

i. Appu Nutritions Private Limited

ii. Nilgiri"s Mechanised Bakery Private Limited

iii. Nilgiris Franchise Private Limited

j. Sublime Foods Private Limited (w.e.f. 18th Feb 2015)

k. Integrated Food Park Private Limited (Associate during the period 24th July 2014 to 5th Feb 2015)

2. Associates

a. Sarjena Foods Private Limited (w.e.f. 5th July 2014)

3. Key Management Personnel (KMP)

a. Arun Kumar Agarwal - Manager

b. Ashni Biyani - Whole Time Director (w.e.f 15th Nov 2014)

4. Enterprises over which key management personnel can exercise control / significant influence (KMP has significant influence)

a. Future Ideas Company Limited (upto 30th May 2013)

b. Future Retail Limited (formerly known as Pantaloon Retail (India) Limited) (upto 30th May 2013)

7. CONTINGENT LIABILITIES

As at As at

Particulars 31st March 2015 31st March 2014

RS. In Lakhs RS. In Lakhs

Corporate Guarantees issued to bank 11,015.98 5,565.24

Disputed Income Tax Demand 2,01758 126.70

Disputed Sales Tax Matter 14705 -

Claims not acknowledged as debt* 50.98 4763

13,231.59 5,739.57

*does not include cases where liability is not ascertainable.

Future cash outflows in respect of the above matters are determinable only on receipt of judgments / decisions pending at various forums / authorities.

8. The estimated amount of contracts remaining to be executed on capital account as at 31st March "2015 is RS. 1,362.53 lakhs. (Previous Year RS. NIL).

9. COMPOSITE SCHEME OF AMALGAMATION AND ARRANGEMENT

A Scheme of Amalgamation under Sections 391 and 394 and other applicable provisions of the Companies Act, 1956, filed by the Company for merger of its subsidiary Future Agrovet Limited (FAL) with the Company has been approved by the Hon"ble High Court of Bombay on January 30, 2015 and necessary filings have been done with the Registrar of Companies on March 13, 2015. The scheme has been given effect to in the books with effect from April 1, 2014, being the Appointed Date as approved by the Hon"ble High Court at Bombay on the following basis:

1. The business of FAL which stands transferred to and vested in the Company comprises of the business of procuring, processing and supplying of agricultural commodities in loose and packaged form under various private brands of the company.

2. The amalgamation has been accounted under the Purchase Method.

3. The entire assets and liabilities of FAL (the Amalgamating Company) have been accounted in the books of the Company at their respective fair values.

4. Since the entire share capital of FAL is held by the Company, no shares or consideration is to be issued / payable by the Company.

5. The difference between the fair value of assets net of liabilities of FAL and the value of investments in FAL held by the Company amounting to RS. 3279.80 lakhs has been debited to goodwill.

10. DETAILS OF LEASING ARRANGEMENTS:

The Company has entered into cancellable operating lease arrangement for its stores and office premises. Operating lease rentals charged to Statement of Profit and Loss aggregate to RS. 2,56792 lakhs (Previous year RS. 2,092.46 lakhs.)

11. Certain subsidiaries of the company have incurred losses resulting in erosion of their net- worth. These companies are in the process of building respective businesses/brands and creating substantial value. The management is fully committed to lead to profitability by providing the necessary financial support and mentoring. Therefore, in the opinion of the management, the diminutions in the value of the said investment are temporary in nature and consequently, no adjustment is considered necessary to the carrying value of investment.

12. During the year, pursuant to the notification of Schedule II to the Companies Act, 2013 with effect from April 1, 2014, the Company has revised the estimated useful life of some of its assets to align the useful life with those specified in Schedule II. Further, assets individually costing RS. 5,000/- or less that were depreciated fully in the year of purchase are now depreciated based on the useful life considered by the Company for the respective category of assets.

The depreciation expense in the statement of Profit and Loss for the year is higher by RS. 266.51 lakhs consequent to the change in useful life of the assets.

Pursuant to the transition provisions prescribed in Schedule II to the Companies Act, 2013, the Company has fully depreciated the carrying value of assets, net of residual value, where the remaining useful life of the asset was determined to be nil as on April 1,2014, and has adjusted an amount of RS. 63.82 lakhs against the opening balance in Profit & Loss Account under Reserves and Surplus.

13. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified based on information available with the Company. The principal amount due and remaining unpaid as on 31st March 2015 is RS. NIL (Previous year RS. 26.04 lakhs) and interest due and payable there on is RS. 0.82 lakhs (Previous year 0.82 lakhs ).

14. During the current year, one of the subsidiary of the Company, Star and Sitara Wellness Limited has closed down its business on account of losses. The Company has made a provision for other than temporary diminution in value of its entire Investment in Star and Sitara Wellness Limited amounting to RS. 1,800 lakhs and written off inter corporate deposits of RS. 714.00 lakhs given to the Subsidiary.

15. The Company is engaged primarily in operating Food and FMCG products sourcing, branding and distribution business and is no longer entitled to hold the certificate of registration based on the non-fulfilment of the principal business criteria as required for being a Non-Banking Financial Company ("NBFC"), as laid down in the press release dated April 08, 1999. The Company accordingly has intimated the change in business to the Reserve bank of India (RBI) and has applied for deregistration as a NBFC, vide its communication dated May 30, 2013.

However, pending deregistration by the RBI, the Company has for the year under consideration, complied with the prudential norms relating to income recognition, accounting standards, asset classification and provisioning for bad and doubtful debts as applicable to it in terms of the Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007 However, no disclosures pursuant to Reserve Bank of India Notification DNBS.193DG (VL) - 2007 dated 22nd February, 2007 (Para 13 Disclosure), Notification DNBS.200/ CGM (PK) 2008 dated 1st August, 2008 (CRAR Disclosure) and additional disclosure pursuant to Notification DNBR (PD) CC.No.002/03.10.001/2014-15 dated 10th November, 2014 have been made in these financial statements, as the same are no longer considered to be pertinent.

16. Previous year"s figures have been regrouped / reclassified wherever necessary to correspond with the current year"s classification / disclosure. The figures for the current year includes the operations of the entire business undertaking of Future Agrovet Limited with effect from April 1, 2014 as explained in detail in Note 38. In view of this, the figures for the current year are not comparable with those of the corresponding previous year.


Mar 31, 2014

1. Employee Stock Option Plan

The Board at its meeting held on July 12, 2010, has approved issue of Stock Options up to a maximum of 50,000,000 Equity Shares, with a ceiling of upto 1% of the paid-up equity share capital in any fi nancial year subject to the approval of the shareholders under Section 81 (1A) of the Companies Act, 1956. The options allotted under ESOP are convertible into equal number of equity shares. The Shareholders of the Company at the Annual General Meeting held on August 10, 2010 approved the afore-said issue of 50,000,000 Equity Shares of the Company under one or more Employee Stock Option Scheme(s). Post listing of the Company, the Shareholders have ratifi ed the pre-IPO scheme. The Compensation and Nomination Committee has approved the following grants to certain directors and employees of the Company and some of its Subsidiaries in accordance with the FVIL Employees Stock Option Plan 2011 (ESOP Scheme):

Stock Compensation Expense:

The employee compensation cost has been calculated using the intrinsic value method of accounting for Options issued under the Company''s Employee Stock Option Schemes. The employee compensation cost as per the intrinsic value method for the financial year 2013-14 is Nil.

Fair Value Methodology

The fair value of Options used to compute proformanet profit and earnings per Equity Share have been estimated on the date of the grant using Black-Scholes model by an independent valuer.

2. Segment Reporting

The Company was in the process of reorganizing its business, since the previous year, to become an entity engaged in Branding, Selling and Distribution of "Consumer products" which in terms of Accounting Standard 17 "Segment Reporting" constitute a single reporting segment. Consequently, on all the schemes becoming effective, investment activities are no longer considered a separate business segment by the management and thus reporting of "Investment" as a separate segment has been discontinued. Hence, there is no separate reportable segment under Accounting Standard 17 "Segment Reporting".

3. Earnings per Share

The Company has only one class of equity share, hence the Profi t after Tax is used for computation of earnings per share without any adjustment.

4. Related Party Disclosures

A. Names of Related Parties and Nature of Relationship for Financial Year 2013-14 1. Subsidiary Companies

a. Aadhaar Wholesale Trading and Distribution Limited (formerly known as Aadhaar Retailing Limited)

b. Future Agrovet Limited (w.e.f. 12th November 2013)

c. Future Consumer Products Limited

d. Future Food and Products Limited (formerly known as Future Consumer Enterprises Limited)

e. Star and Sitara Wellness Limited (Formerly known as Star and Sitara Wellness Private Limited)

f. Amar Chitra Katha Private Limited and its subsidiaries:

i. IBH Books and Magazines Distributors Limited (Formerly known as IBH Books and Magazines Distributors Private Limited)

ii. ACK Edutainment Limited (Formerly known as ACK Edutainment Private Limited)

iii. ACK Eaglemoss Collectibles Publishing Private Limited

iv. ACK Media Direct Limited (Formerly known as ACK Media Direct Private Limited)

v. Karadi Tales Company Private Limited

vi. Ideas Box Entertainment Limited (Formerly known as Ideas Box Entertainment Private Limited)

g. Express Retail Services Private Limited

2. Associates

a. Capital Foods Private Limited (Formerly known as Capital Foods Exportts Private Limited (upto 11th December 2013) and its subsidiary:

i. Integrated Food Park Private Limited (upto 11th December 2013)

b. Karadi Path Education Company Private Limited (Upto 31st August 2013) (Associate of Amar Chitra Katha Private Limited).

3. Key Management Personnel (KMP)

a. Mr. Kishore Biyani - Managing Director (upto 30th May, 2013)

b. Mr. K.K. Rathi - Executive Director and CEO (From 31st May 2013 upto 4th February 2014)

c. Arun Kumar Agarwal - Manager (w.e.f. 5th February 2014)

4. Enterprises over which key management personnel can exercise control / significant influence (KMP has significant influence)

a. Future Ideas Company Limited (upto 30th May, 2013)

b. Vayuputra Realty Private Limited (upto 30th May, 2013)

c. Future Retail Limited (formerly known as Pantaloon Retail (India) Limited) (upto 30th May, 2013)

B. Names of Related Parties and Nature of Relationship for Financial Year 2012-13

1. Subsidiary Companies

a. Aadhaar Wholesale Trading and Distribution Limited (formerly Aadhaar Retailing Limited)

b. Indus League Clothing Limited (Upto 31st December,2012)

c. Lee Cooper (India) Limited (Up to 30th November,2012)

d. Indus Tree Crafts Private Limited (Up to 31st December,2012)

e. Indus Tree Producer Transform Private Limited (Up to 31st December,2012)

f. Future Consumer Products Limited

g. Amar Chitra Katha Private Limited and its subsidiaries:

i. IBH Books and Magazines Distributors Limited (Formerly known as IBH Books and Magazines Distributors Private Limited)

ii. ACK Edutainment Limited (Formerly known as ACK Edutainment Private Limited)

iii. ACK Eaglemoss Collectibles Publishing Private Limited

iv. ACK Media Direct Limited (Formerly ACK Media Direct Private Limited)

v. Karadi Tales Company Private Limited

vi. Ideas Box Entertainment Limited (Formerly known as Ideas Box Entertainment Private Limited )

h. Express Retail Services Private Limited (With effect From 15th September,2012)

i. Think Fresh International Private Limited (With effect from 15th September,2012)

j. Star and Sitara Wellness Limited (Formerly known as Star and Sitara Wellness Private Limited) (With effect From 12th September,2012)

k. Future Food and Products Limited (Formerly known as Future Consumer Enterprises Limited )

2. Associates

a. And Designs India Limited (Up to 31st December,2012)

b. Capital Food Private Limited (Formerly known as Capital Foods Exportts Private Limited) and its subsidiary:

i. Integrated Food Park Private Limited

c. Turtle Limited (Up to 31st December,2012) (Associate of Indus League Clothing Limited)

d. Biba Apparels Private Limited (Up to 31st December,2012)

e. Karadi Path Education Company Private Limited (Associate of Amar Chitra Katha Private Limited)

3. Joint Ventures

a. Holii Accessories Private Limited (Up to 31st December,2012)

b. Celio Future Fashion Limited (Joint Venture of Indus League Clothing Limited) (Up to 31st December,2012)

c. Clarks Future Footwear Limited (Up to 31st December,2012)

4. Key Management Personnel (KMP)

a. Mr. Kishore Biyani - Managing Director

5. Enterprises over which key management personnel can exercise control/significant influence

i. Akar Estate Finance Private Limited

ii. Anchor Residency Private Limited (Formerly known as "Anchor Malls Private Limited")

iii. Asian Retail Lighting Limited

iv. Bansi Mall Management Co Private Limited

v. DMA Yellow Works Limited

vi. ESES Commercial Private Limited

vii. Fashion Global Retail Limited

viii. FSC Brand Distribution Services Limited

ix. Future Agrovet Limited

x. Future Brands Limited

xi. Future Corporate Resources Limited

xii. Future E Commerce Infrastructure Limited

xiii. Future Venture Employee Welfare Trust

xiv. Future Human Development Limited

xv. Future Ideas Company Limited

xvi. Future Ideas Realtors India Limited

xvii. Future Knowledge Services Limited

xviii. Future Lifestyle Fashion Limited

xix. Future Outdoor Media Solutions Limited

xx. Future Retail Limited (formerly Pantaloon Retail (India) Limited)

xxi. Future Supply Chain Solutions Limited

xxii. Future Value Retail Limited

xxiii. Idiom Design and Consulting Limited

xxiv. Manz Retail Private Limited

xxv. Nufuture Digital (India) Limited

xxvi.nuFuture Haribhakti Business Services Limited

xxvii.PRTL Enterprises Limited

xxviii.Staples Future Office Products Private Limited

xxix.Suhani Trading and Investment Consultants Private Limited

xxx. Vayuputra Realty Private Limited

xxxi. Weavette Texstyles Limited

5. Contingent Liabilities

As at As at Particulars 31st March 2014 31st March 2013 Rs.In Lakhs Rs. In Lakhs

Corporate Guarantees issued to bank 5,565.24 3,900.00

Bank Guarantees 28.00

Disputed Income Tax Demand 126.70 51.80

Bill Discounting 292.37

Claims not acknowledged as debt* 47.63

Total 5,739.57 4,272.17

*does not include cases where liability is not ascertainable.

Future cash outflows in respect of the above matters are determinable only on receipt of judgments / decisions pending at various forums / authorities.

6. Composite scheme of Amalgamation and Arrangement

A. The Composite Scheme of Arrangement and Amalgamation fi led by the Company in respect of transfer of business and undertakings of Express Retail Services Private Limited (ERSPL) relating to food products and related activities, and transfer of entire business and undertakings of Think Fresh International Private Limited (TFIPL) with the Company, as a going concern, with the H''ble High Court at Delhi, has been approved on July 25, 2013 and necessary flings have been done with the Registrar of Companies on September 25, 2013. The scheme has been given effect to in the books with effect from September 15, 2012, being the Appointed Date as approved by the H''ble High Court at Delhi. Consequently:-

(a) The net loss of the above mentioned business and undertakings from the appointed date till March 31, 2013, amounting to Rs. 866.58 lakhs, has been transferred to opening Reserves and surplus (Defi cit in Statement of Profi t and Loss) as on April 1, 2013; and

(b) The difference between the value of assets and liabilities (after adjustment of investment in the above mentioned business and undertakings), ofRs. 4,672.75 lakhs has been debited to goodwill,

(c) Amortization of goodwill (net of capital reserve amounting to Rs. 715.51 lacs) for the period ended March 31, 2013 amounting to Rs. 396.30 lakhs has been adjusted against the opening Reserves and Surplus (defi cit in Statement of Profit and Loss)

(d) Since the entire share capital of ERSPL is held by the Company, no shares or considerations is to be issued/payable by the company.

B. Disclosures relating to amalgamation of TFIPL with the Company as required under AS 14:

Pursuant to the composite scheme of amalgamation and arrangement as explained in Para 37 A, the entire business and undertaking of TFIPL (the Amalgamating Company) stand transferred to and vested in the Company as a going concern w.e.f. September 15, 2012. The accounting for this arrangement was done as per the scheme sanctioned by the Hon''ble High Court of Judicature at Delhi vide its order dated July 25, 2013 and the

same has been given effect to as under:

1. The business of TFIPL which stands transferred to and vested in the Company comprises of the business of food products.

2. The amalgamation has been accounted under the Purchase Method.

3. The entire assets and liabilities of TFIPL (the Amalgamating Company) have been accounted in the books of the Company at their respective fair values.

4. Since the entire share capital of TFIPL is held by ERSPL and consequently pursuant to the transfer of ERSPL Demerged undertaking, the entire capital of TFIPL will be held by the Company, no shares or consideration is to be issued / payable by the Company.

5. The difference between the value of assets net of liabilities of TFIPL and the value of investments in TFIPL held by the Company amounting to Rs. 62.66 lakhs has been debited to goodwill.

7. A composite scheme of Amalgamation and Arrangement between the Company, Indus League Clothing Limited, Lee Cooper (India) Limited, Future Retail Limited (formerly known as Pantaloon Retail (India) Limited) and Future Lifestyle Fashion Limited and their respective shareholders and creditors was approved by the Hon''ble High Court and has been given effect to in the books of accounts in the previous Financial Year. Similarly, a part of composite scheme of Amalgamation and Arrangement between the Company, Future Food and Products Limited (formerly known as Future Consumer Enterprises Limited), Express Retail Services Private Limited and Think Fresh International Private Limited and their respective shareholders and creditors was also given effect to in the books of accounts in the previous Financial Year.

8. Details of leasing arrangements:

The Company has entered into cancellable operating lease arrangement for its stores and office premises. Operating lease rentals charged to revenue aggregate to Rs. 2,092.46 Lakhs (Previous year Rs. 1,206.78 Lakhs.)

9. Certain subsidiaries of the company have incurred losses resulting in erosion of their net- worth. These companies are in the process of building respective businesses/brands and creating substantial value. The management is fully committed to lead to profitability by providing the necessary financial support and mentoring. Therefore, in the opinion of the management, the diminutions in the value of the said investment are temporary in nature and consequently, no adjustment is considered necessary to the carrying value of investment.

10. This information as required to be disclosed under section 22 of the 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. The principal amount outstanding and interest due there on as at the year end is Rs. 26.04 lakhs and Rs. 0.82 lakhs respectively.

11. Consequent to the amalgamation and arrangement schemes becoming effective in the previous financial year, the Company became an entity engaged primarily in operating Food and FMCG outlets and distribution business. As a result of the above- mentioned reorganisation, the asset/ income pattern of the Company as on March 31, 2013 changed consequent to which the Company was no longer entitled to hold the certificate of registration based on the non-fulfillment of the principal business criteria as required for being a Non-Banking Financial Company ("NBFC"), as laid down in the press release dated April 08, 1999. The Company accordingly intimated the change to the Reserve bank of India (RBI) and has applied for deregistration as a NBFC, vide its communication dated May 30, 2013.

However, pending deregistration by the RBI, the Company has for the year under consideration, complied with the prudential norms relating to income recognition, accounting standards, asset classification and provisioning for bad and doubtful debts as applicable to it in terms of the Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007. However, no disclosures pursuant to Reserve Bank of India Notification DNBS.193DG (VL) - 2007 dated 22nd February, 2007 (Para 13 Disclosure) and Notification DNBS.200/CGM (PK) 2008 dated 1st August, 2008 (CRAR Disclosure) have been made in these financial statements, as the same are no longer considered to be pertinent.

12. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure. The figures for the current year includes the operations of demerged undertaking of Express Retail Services Private Limited (ERSPL) and entire business undertaking of Think Fresh International Private Limited (TFIPL) with effect from September 15, 2012 as explained in detail in Note 37. In view of this, the figures for the current year are not comparable with those of the corresponding previous year.


Mar 31, 2013

1. Corporate Information

Future Ventures India Limited ("Company") is part of Future Group and its vision is to create, build, acquire, and invest in and operate innovative and emerging businesses in India''s rapidly growing "consumption-led" sectors. This sector is highly dependent on the growing purchasing power of Indian consumers and their changing tastes, lifestyle and spending habits. Vision is achieved through operational control or infl uence in the business ventures that the company promotes or in which it acquires interest in. It also engages in operationally managing and strategically mentoring these businesses.

The Company was incorporated on 10th July, 1996, as a Private Limited Company and became a Public Limited Company with effect from 7th September, 2007. The shares of the Company were listed in the National Stock Exchange and Bombay Stock Exchange on 10th May, 2011. The Company is regulated by the RBI as a non-deposit taking Non-Banking Financial Company (NBFC).

During the year, the management of Future Group reorganized their businesses in order to consolidate the food and fashion businesses through two separate Composite Scheme of Amalgamation and Arrangement ("the Schemes") which were sanctioned by the Hon''ble High Court of Judicature at Bombay vide its order dated 10th May, 2013 (Refer Note 38 for further details about the Scheme). As a result of the reorganization as stated above, the Company has become an entity, engaged in operating Food and FMCG outlets and distribution in Urban and Rural areas with its own branded products in addition to the third party brands and products, and will not be able to satisfy the norms of having the prescribed assets/income pattern otherwise required for being a Non-Banking Financial Company. The Company is in the process of carrying out the necessary formalities to surrender its Certifi cate of Registration with the Reserve Bank of India. Pending completion of formalities and surrendering of the Certifi cate of Registration, the Company has for the year, complied with the prudential norms relating to income recognition, accounting standards, asset classifi cation and provisioning for bad and doubtful debts as applicable to it in terms of the Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007.

2. Employee Stock Option Plan

The Board at its meeting held on 12th July, 2010, has approved issue of Stock Options up to a maximum of 50,000,000 Equity Shares, with a ceiling of upto 1% of the paid-up equity share capital in any fi nancial year subject to the approval of the shareholders under Section 81 (1A) of the Companies Act, 1956. The Shareholders of the Company at the Annual General Meeting held on 10th August, 2010 approved the aforesaid issue of 50,000,000 Equity Shares of the Company under one or more Employee Stock Option Scheme(s). Post listing of the Company, the Shareholders have ratifi ed the pre-IPO scheme.

3. Segment Reporting

In accordance with paragraph 4 of Accounting Standard 17 - Segment Reporting, segment information has been presented only on the basis of the consolidated fi nancial statements.

4. Earnings Per Share

The Company has only one class of equity share, hence the Profi t after Tax is used for computation of earnings per share without any adjustment

5. Certain subsidiaries of the Company have incurred losses resulting in erosion of their networth. These companies are in the process of building respective businesses/brands and creating substantial value. The management is fully committed to lead to profi tability by providing the necessary fi nancial support and mentoring. Therefore, in the opinion of the management, the diminutions in the value of the said investment are temporary in nature and consequently, no adjustment is considered necessary to the carrying value of investment.

6. Related Party Disclosures

A. Names of Related Parties and Nature of Relationship

( as identifi ed by the management and relied upon by the auditors)

1. Subsidiary Companies

i. Aadhaar Retailing Limited

ii. Indus League Clothing Limited (Upto 31st December,2012)

iii. Lee Cooper (India) Limited (Subsidiary of Indus League Clothing Limited) (Up to 30th November,2012)

iv. Indus Tree Crafts Private Limited (Up to 31st December,2012)

v. Indus Tree Producer Transform Private Limited (Subsidiary of Indus Tree Craft Private Limited) (Up to 31st December,2012)

vi. Future Consumer Products Limited

vii. Amar Chitra Katha Private Limited

viii. India Books and Magazines Distributors Private Limited (Subsidiary of Amar Chitra Katha)

ix. ACK Edutainment Limited (formerly known as ACK Edutainment Private Limited) (Subsidiary of Amar Chitra Katha)

x. ACK Eaglemoss Collectibles Publishing Private Limited (Subsidiary of Amar Chitra Katha)

xi. ACK Media Direct Private Limited (Subsidiary of Amar Chitra Katha)

xii. Karadi Tales Company Private Limited (Subsidiary of Amar Chitra Katha)

xiii. Ideas Box Entertainment Limited (formerly known as Ideas Box Entertainment Private Limited) (Subsidiary of Amar Chitra Katha)

xiv. Express Retail Services Private Limited (With effect From 15th September,2012)

xv. Think Fresh International Private Limited (Subsidiary of Express Retail Services Private Limited) (With effect From 15th September,2012)

xvi. Star and Sitara Wellness Private Limited (With effect From 12th September,2012)

xvii. Future Consumer Enterprises Limited

2. Associates

i. And Designs India Limited (Up to 31st December,2012)

ii. Capital Foods Exportts Private Limited

iii. Integrated Food Park Private Limited (Subsidiary of Capital Foods Exportts Private Limited )

iv. Turtle Limited (Up to 31st December,2012) (Associate of Indus League Clothing Limited)

v. Biba Apparels Private Limited (Up to 31st December,2012)

vi. Karadi Path Education Company Private Limited (Associate of Amar Chitra Katha)

3. Joint Ventures

i. Holii Accessories Private Limited (Up to 31st December,2012)

ii. Celio Future Fashion Limited (Joint Venture of Indus League Clothing Limited)(Up to 31st December,2012)

iii. Clarks Future Footwear Limited (Up to 31st December,2012)

4. Enterprises over which key management personnel can exercise control/ signifi cant infl uence i. Akar Estate Finance Private Limited

ii. Anchor Residency Private Limited (Formerly known as "Anchor Malls Private Limited")

iii. Asian Retail Lighting Limited

iv. Bansi Mall Management Co Private Limited

v. DMA Yellow Works Limited

vi. ESES Commercial Private Limited

vii. Fashion Global Retail Limited

viii. FSC Brand Distribution Services Limited

ix. Future Agrovet Limited

x. Future Brands Limited

xi. Future Corporate Resources Limited

xii. Future E Commerce Infrastructure Limited

xiii. Future Ventures Employee Welfare Trust

xiv. Future Human Development Limited

xv. Future Ideas Company Limited

xvi. Future Ideas Realtors India Limited

xvii. Future Knowledge Services Limited

xviii. Future Lifestyle Fashion Limited

xix. Future Outdoor Media Solutions Limited

xx. Future Retail Limited (formerly Pantaloon Retail (India) Limited)

xxi. Future Supply Chain Solutions Limited

xxii. Future Value Retail Limited

xxiii. Idiom Design and Consulting Limited

xxiv. Manz Retail Private Limited

xxv. Nufuture Digital (India) Limited

xxvi. nuFuture Haribhakti Business Services Limited

xxvii. PRTL Enterprises Limited

xxviii. Staples Future Offi ce Products Private Limited

xxix. Suhani Trading and Investment Consultants Private Limited

xxx. Vayuputra Realty Private Limited

xxxi. Weavette Texstyles Limited

5. Key Management Personnel

i. Kishore Biyani - Managing Director

7. Contingent Liabilities

As at As at Paicuars 31st March 2013 31st March 2012 Rs. In Lakhs RS. In Lakhs

Corporate Guarantees issued to Bank 3,900.00 3,900.00 Bank Guarantees 28.00

Disputed Income Tax Demand 51.80 113.20 Bill Discounting 292.37

Total 4,272.17 4,013.20

No provision is presently considered necessary for Income tax demands aggregating to Rs. 51.80 Lakhs (Previous Year Rs. 113.20 Lakhs) which are under various stages of appeal as the Company is of the view that the said demands are not sustainable in law.

8. Composite scheme of Amalgamation and Arrangement

A. A composite scheme of Amalgamation and Arrangement (hereinafter referred as "Fashion Scheme") between the Company, Indus League Clothing Limited ("ILCL"), Lee Cooper (India) Limited ("LEE"), Pantaloon Retail (India) Limited ("PRIL") (now known as "Future Retail Limited"), and Future Lifestyle Fashion Limited ("FLFL") and their respective shareholders and creditors has been sanctioned by Hon''ble Bombay High Court vide its order dated 10th May, 2013. As the relevant appointed dates from which the arrangements under the scheme are effective fall within the Financial Year As at 31st March 2013 the said scheme has been given effect to in these fi nancial statements.

Pursuant to the said "Fashion scheme":

1. The entire business and undertaking of ILCL relating to its Fashion business and related activities (ILCL demerged undertaking) stand transferred to and vested in the Company as a going concern w.e.f. 1st December, 2012.

2. The entire business and undertaking of LEE (the Amalgamating Company) stand transferred to and vested in the Company as a going concern w.e.f. 1st December, 2012.

3. The entire business and undertaking of fashion business of the Company (FVIL demerged undertaking) stand transferred to and vested in FLFL as a going concern w.e.f. 1st January, 2013.

4. In consideration of the transfer of ILCL demerged undertaking to the Company the minority shareholders of ILCL have to be issued and allotted 2,17,32,971 fully paid equity share of Rs. 10 each in the Company against 14,27,364 shares held by them.

5. The entire share capital of LEE is held by ILCL and consequently pursuant to the transfer of ILCL demerged undertaking, the entire capital of LEE (which forms part of ILCL demerged undertaking) will be held by the Company, no shares or consideration is to be issued / payable by the Company.

6. In consideration of the transfer of FVIL demerged undertaking to FLFL, equity shareholders of the Company have to be issued and allotted 1 (One) equity share of Rs. 2/- each of FLFL fully paid up for every 31 (thirty one) fully paid up equity shares of the Company held by them.

7. As an integral part of the scheme the face value of shares held by shareholders of the Company stands reduced from Rs. 10 to Rs. 6 each. Pursuant to the above, an amount of Rs. 63,919.07 Lakhs has been credited to Business Restructuring Reserve and has been set off against the goodwill aggregating to Rs. 63,203.56 Lakhs arising in the books of the Company pursuant to the Fashion scheme referred above and food scheme referred in 38 B below. The balance amount of Rs. 715.51 Lakhs remaining in the Business Restructuring Reserve has been transferred to Capital Reserve which shall be subject to adjustment of goodwill on giving effect to the Composite Scheme of Amalgamation and Arrangement with respect to Food Scheme which is pending before the Hon''ble High Court of Delhi for their sanction (Refer Note 38B(3)).

B. A composite scheme of Amalgamation and Arrangement (hereinafter referred as "Food Scheme") between the Company, Future Consumer Enterprise Limited ("FCEL"), Express Retail Services Private Limited ("ERSPL"), and Think Fresh International Private Limited ("TFIPL") and their respective shareholders and creditors has been sanctioned by Hon''ble Bombay High Court vide its order dated 10th May, 2013. As the relevant appointed date from which the arrangement under the scheme are effective fall in the Financial Year As at 31st March 2013 the said scheme has been given effect to in the fi nancial statements.

Pursuant to the said "Food scheme":

1. The entire business and undertaking of FCEL relating to Consumer Goods business and related activities (FCEL demerged undertaking) stand transferred to and vested in the Company as a going concern w.e.f. 1st April, 2012.

2. Since the entire share capital of FCEL is held by the Company, no shares or consideration is to be issued / payable by the Company.

3. The other part of the scheme relating to transfer of entire business and undertaking relating to food business of ERSPL to the Company as a going concern and transfer of entire business and undertaking of TFIPL to the Company as a going concern is pending for sanction by Hon''ble High Court of Delhi. The scheme will be given effect to in the books with effect from 15th September, 2012, being the appointed date upon receipt of sanction of the said part of the scheme from Hon''ble High Court of Delhi and on completion of other regulatory formalities.

C. Disclosures relating to Amalgamation of Lee with the Company as required under AS 14:

Pursuant to the composite scheme of Amalgamation and Arrangement as explained in Para 38 A, the entire business and undertaking of LEE (the Amalgamating Company) stand transferred to and vested in the Company as a going concern w.e.f. 1st December, 2012. The accounting for this arrangement was done as per the scheme sanctioned by the Hon''ble Bombay High Court vide its order dated 10th May, 2013 and the same has been given effect to as under:

1. Lee is engaged in the business of manufacturing and retailing of lifestyle products ,including denims, trousers , jackets , shirts and shoe under the "Lee Cooper Brand"

2. The Amalgamation has been accounted under the Purchase Method.

3. The entire assets and liabilities of LEE (the Amalgamating Company) has been accounted in the books of the Company at their respective fair values.

4. Since the entire share capital of LEE is held by ILCL and consequently pursuant to the transfer of ILCL demerged undertaking, the entire capital of LEE will be held by FVIL, no shares or consideration is to be issued / payable by the Company.

5. The difference between the value of assets net of liabilities of LEE and the value of investments in Lee held by the Company amounting to Rs. 209.97 Lakhs has been credited to Capital reserve. This amount is set-off against goodwill referred in Para 38A7 above.

9. Details of leasing arrangements:

The Company has entered into cancellable operating lease arrangement for its stores and offi ce premises. Operating lease rentals charged to revenue aggregate to Rs.1027.98 Lakhs.

10. In view of the reorganisation of the businesses by the Future Group and pursuant to the composite scheme of Amalgamation and Arrangement, as sanctioned by the Hon''ble High Court, as referred in Note 1 above, the Company has become an operating entity, engaged predominantly in operating Food and FMCG outlets and distribution business. Accordingly, the Company now has operating income from activities which are not fi nancial activities and hence is not able to satisfy the norms of having the prescribed assets/income pattern otherwise required for being a Non-Banking Financial Company. The Company has intimated about the same to the Reserve Bank of India and pending completion of formalities and surrendering of the Certifi cate of Registration, the Company has for the year, complied with the prudential norms relating to income recognition, accounting standards, asset classifi cation and provisioning for bad and doubtful debts as applicable to it in terms of the Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007. However, no disclosures pursuant to Reserve Bank of India Notifi cation DNBS.193DG (VL) - 2007 dated 22nd February, 2007 (Para 13 Disclosure) and Notifi cation DNBS.200/CGM (PK) 2008 dated 1st August, 2008 (CRAR Disclosure) have been made in these fi nancial statements as they are no longer pertinent.

11. Previous year''s fi gures have been regrouped / reclassifi ed wherever necessary to correspond with the current year''s classifi cation / disclosure. The results for the current year includes the operations of demerged undertaking of Future Consumer Enterprises Limited with effect from 1st April, 2012 and the demerged undertaking of Indus League (ILCL) and entire business undertaking of Lee Cooper (LEE) for one month as more explained in detail in Note 38. In view of this, the results for the current year are not comparable with those of the corresponding previous year.


Mar 31, 2012

Notes:

i) Pursuant to the Initial Public Offer made during the month of April 2011, the Company issued 750,000,000 Shares of Rs. 10 each at a price of Rs.10 each raising Rs. 75,000 Lakhs. The shares of the Company were listed on National Stock Exchange of India Limited and Bombay Stock Exchange Limited on May 10, 2011.

ii) During the previous year, the Company had issued 250,000,000 Equity shares at par value ofRs. 10/- each to promoter companies on preferential basis.

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 equity shares is entitled to one vote per share. During the year ended March 31, 2012 and March 31, 2011, the Company has not declared any dividend.

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

1. EXCEPTIONAL ITEMS - IPO EXPENSES

During the year, the Company has allotted 750,000,000 Shares at par value ofRs. 10 per equity share. The IPO expenses incurred during the year aggregating to Rs. 3,100.30 Lakhs (Previous Year Rs. 448.03 Lakhs) have been absorbed in the Statement of Profit and Loss.

The estimates of future salary increase take into account inflation, seniority, promotion and other relevant factors. The disclosure requirement with regard to composition of Investments in the Fair Value of Plan assets has not been furnished, since the liability is not funded. Disclosure relating to experience adjustments has not been provided in the absence of relevant information.

2. EMPLOYEE STOCK OPTION PLAN

The Board at its meeting held on July 12, 2010, approved issue of Stock Options up to a maximum of 1 % of the paid up Equity Share Capital of the Company (before Rights Issue) aggregating to 50,000,000 Equity Shares in a manner provided in the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 subject to the approval of the shareholders under Section 81 (1A) of the Companies Act, 1956. The Shareholders of the Company at the Annual General Meeting held on August 10, 2010 approved the aforesaid issue of 50,000,000 Equity Shares of the Company under one or more Employee Stock Option Scheme(s). Post listing of the company, the shareholders have ratified the pre-IPO scheme. The Compensation and Nomination Committee has approved the following grants to certain directors and employees of the Company and some of its Subsidiaries in accordance with the FVIL Employees Stock Option Plan 2011 (ESOP Scheme):

Deferred Stock Compensation Expense:

As the exercise price has been fixed at fair value as on date of grant, there is no compensation cost which needs to be amortized over the vesting period of the stock option.

Fair Value Methodology

The fair value of Options used to compute proforma net profit and earnings per Equity Share have been estimated on the date of the grant using Black-Scholes model by an independent consultant.

3. During the year ended March 31, 2012, the Company has formulated a scheme (Future Ventures Employee Welfare Trust Plan (FVEWTP)) which shall be administered by the IL&FS Trust Company Limited . The objective of the FVEWTP is to subscribe to the equity shares of the Company, to hold and dispose them from time to time and to distribute any surpluses arising there from to the beneficiaries of FVEWTP. Certain eligible employees of the Company and its Business Ventures as recommended by the Executive Committee are the beneficiaries under FVEWTP.

4. SEGMENTAL REPORTING

The Company is primarily engaged in the business of investing/financing in consumer product Businesses/Brands. Further, the Company does not have any operations outside India. As such, there are no separate reportable segments as per AS 17"Segmental Reporting".

5. EARNINGS PER SHARE Numerator

The Company has only one class of equity share, hence the Profit after Tax is used for computation of earnings per share without any adjustment.

The Company has issued employee stock options during the year which gives rise to potential equity shares. However, as per the terms of the stock option scheme, the exercise price is greater than the average fair value of the shares during the year. Therefore, these potential shares are considered to be anti-dilutive and accordingly, they are not considered in the computation of diluted earnings per share. Hence the basic and diluted earnings per share are the same.

Pending utilization of the full proceeds of the issue, the funds are temporarily invested/held in various Mutual Funds, Certificate of Deposits, Inter Corporate Deposits and Company's Bank Accounts.

6. Certain subsidiaries of the company have incurred losses resulting in erosion of their net worth. These companies are in the process of building respective businesses/brands and creating substantial value. The management is fully committed to lead them to profitability by providing the necessary financial support and mentoring. Therefore, in the opinion of the management, the diminutions in the value of the said investment are not other than temporary in the nature and consequently, no adjustment is considered necessary to their carrying values.

Notes:

i. Includes Optional convertible debentures amounting to Rs. 2,000 Lakhs issued by a subsidiary company Aadhaar Retailing Limited which has been converted into equity shares ofRs. 10 each.

ii. Figures in bracket represent previous year's figures.

Notes:

i. Includes optionally convertible debentures amounting to Rs. 2,000 Lakhs issued by subsidiary company Aadhaar Retailing Limited has been converted into equity.

ii. In the previous year, 7,000,000 shares of Aadhaar Retailing Limited held by the Company have been pledged to Future Capital Holdings Limited.

7. CONTINGENT LIABILITIES

A. Bank Guarantees and Asset Given as Security

As at As at Particulars March 31, 2012 March 31, 2011 Rs.In Lakhs Rs.In Lakhs

Bank Guarantees

Indus League Clothing Ltd. 3,300.00 3,300.00

Indus Tree Crafts Pvt. Ltd. 600.00 600.00

Asset Given as Security *

Aadhaar Retailing Ltd - 1,900.00

TOTAL 3,900.00 5,800.00

* In the previous year, 7,000,000 Equity Shares in Aadhaar Retailing Limited have been pledged to Future Capital Holdings Limited (FCH) as security for loan availed by Aadhaar Retailing Limited from FCH.

B. Share Purchase Obligation towards investment in Group Company (net of advances) is Rs. Nil (Previous Year - Rs. 2,188.08 Lakhs)

C. No provision is presently considered necessary for Income tax demands aggregating to Rs. 113.20 Lakhs (Previous Year Rs. Nil) which are under various stages of appeal as the company is of the view that the said demands are not sustainable in law.

8. Disclosure Pursuant to Reserve Bank of India Notification DNBS.193DG (VL) - 2007 dated February 22, 2007 (Para 13 Disclosure) is given below :-

Schedule to the Balance Sheet of a non-deposit taking Non-Banking Financial Company (as required in terms of paragraph 13 of Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007)

9. Disclosure of Frauds reported during the year vide DNBS.PD.CC No. 256/03.10.042/2011-12 Dated March 2, 2012 (as relied upon by auditors).

During the year there were no events of frauds noticed or reported by the Company.

10. INFORMATION ON JOINT VENTURE ENTITY

The particulars of the Company's Joint Venture Entities as at March 31, 2012 including its percentage holding and its proportionate share of Assets, Liabilities, Contingent Liabilities, Capital Commitments, Income and Expenditures of each Joint Venture Entities are given here below: -

11. The Revised Schedule VI has become effective from April 1, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.


Mar 31, 2011

1. A. Preferential Issue : During the year, the Company had issued 250,000,000 Equity shares at par value of Rs. 10/- each to promoter companies on preferential basis.

B. Initial Public Offer : The Company made an Initial Public Offer of 750,000,000 Shares of Rs. 10 each at a price of Rs. 10 each raising Rs. 7,500,000,000 during the month of April 2011. The shares of the Company were listed on National Stock Exchange of India Limited and Bombay Stock Exchange Limited on May 10, 2011.

C. IPO Expenses : The IPO Committee, in their meeting held on May 05, 2011 has allotted 750,000,000 Shares at par value of Rs. 10 per equity share. Consequently, there is no amount to be credited to the Securities Premium Account and the IPO expenses incurred have to be charged to Profit and Loss Account as and when they are incurred. Accordingly, expenses aggregating to Rs. 44,803,498 incurred up to March 31, 2011 have been absorbed in the Profit & Loss Account for the period ended March 31, 2011.

2. Employee Stock Option Plan

The Board at its meeting held on July 12, 2010, approved issue of Stock Options up to a maximum of 1 % of the paid up Equity Share Capital of the Company (before Rights Issue) aggregating to 50,000,000 Equity Shares in a manner provided in the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 subject to the approval of the shareholders under Section 81 (1A) of the Companies Act, 1956. The Shareholders of the Company at the Annual General Meeting held on August 10, 2010 approved the aforesaid issue of 50,000,000 Equity Shares of the Company under one or more Employee Stock Option Scheme(s). The Compensation and Nomination Committee has approved the following grants to certain directors and senior level executives of the Company and some of its Subsidiaries in accordance with the FVIL Employees Stock Option Plan 2011 (ESOP Scheme):

Deferred Stock Compensation Expense:

As the exercise price has been fixed at fair value as on date of grant, there is no compensation cost which needs to be amortized over the vesting period of the stock option.

Fair Value Methodology

The fair value of Options used to compute proforma net profit and earnings per Equity Share have been estimated on the date of the grant using Black-Scholes model by an independent consultant.

3. Segmental Reporting

The Company is primarily engaged in the business of investing/financing. All the activities of the Company revolve around the main business. Further, the Company does not have any operations outside India. As such, there are no separate reportable segments as per AS 17 "Segmental Reporting".

4. i) On the basis of revised/original return of income filed by the Company for the financial years ended March 31, 2009 and March 31, 2010 respectively in October 2010, the net excess provision of Rs. 6,045,296 (after considering the MAT credit of Rs. 8,889,753 relating to financial year 2009-10) has been written back. The MAT Credit of Rs. 8,889,753 is carried under loans and advances considering the fact that the tax liability for the year falls under provisions other than 115JB of Income Tax Act, 1961 and also considering the future taxable income against which the said MAT Credit can be adjusted within the stipulated period.

5. A. Contingent Liability

Amount in Rs.

Particulars March 31, 2011 March 31, Bank Asset Given Total 2010 Guarantees as Security *

Indus League Clothing Ltd. 330,000,000 NIL 330,000,000 NIL

Indus Tree Crafts Pvt. Ltd. 60,000,000 NIL 60,000,000 NIL

Aadhaar Retailing Ltd NIL 190,000,000 190,000,000 NIL

Total 390,000,000 190,000,000 580,000,000 NIL

* Refer Footnote in Schedule 4

B. Share Purchase Obligation towards investment in Group Company (net of advances) is Rs. 218,808,260 (Previous Year – Rs. Nil)

6. Certain subsidiaries of the company have incurred losses resulting in erosion of their net worth.These companies are in the process of building respective businesses/ brands and creating substantial value. The management is fully committed to lead them to profitability by providing the necessary financial support and mentoring.

Therefore, in the opinion of the management, the diminutions in the value of the said investments are temporary in nature and consequently, no adjustment is considered necessary to the carrying value of investment.

7. A. Disclosure Pursuant to Reserve Bank of India Notification DNBS.193DG (VL) - 2007 dated February 22, 2007 (Para 13 Disclosure) is given in Annexure 1 A

B Disclosure Pursuant to Reserve Bank of India Notification DNBS.200/CGM (PK) - 2008 dated August 1, 2008 (CRAR Disclosure) is given in Annexure 1 B

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

Find IFSC