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Directors Report of Titan Company Ltd.

Mar 31, 2023

The Directors are pleased to present the Thirty-Ninth Annual Report together with the Audited Financial Statements for the year ended 31^st March 2023:

1. FINANCIAL RESULTS

('' in crore)
	Standalone		Consolidated
	Financial Year 2022-2023	Financial Year 2021-2022	Financial Year 2022-2023	Financial Year 2021-2022
Revenue from Operations	38,270	27,210	40,575	28,799
Other Income	299	246	308	234
Total Income	38,569	27,456	40,883	29,033
Expenditure	33,500	23,931	35,696	25,458
Profit before exceptional items, finance costs, depreciation and taxes	5,069	3,525	5,187	3,575
Finance Costs	240	195	300	218
Depreciation/Amortisation	364	347	441	399
Profit before share of profit/(loss) of an associate and joint venture and exceptional items and taxes	4,465	2,983	4,446	2,958
Share of profit/(loss) of an associate and jointly controlled entity	-	-	1	-
Profit before exceptional items and taxes	4,465	2,983	4,447	2,958
Exceptional items	-	51	-	54
Profit before taxes	4,465	2,932	4,447	2,904
Income taxes
- Current	1,140	779	1,150	786
- Deferred	(8)	(27)	26	(80)
- taxes of earlier years	-	-	(3)	-
Profit for the year	3,333	2,180	3,274	2,198
Attributable to
- Shareholders of the Company	3,333	2,180	3,250	2,173
- Non-controlling interests	-	-	24	25
Profit brought forward	6,104	4,279	6,028	4,210
Appropriations
Dividend on Equity Shares	(666)	(355)	(666)	(355)
Closing Balance in Retained Earnings	8,771	6,104	8,612	6,027

a) Standalone Numbers:

During the year under review, the Company''s total revenue grew by 41% to '' 38,270 crore compared to '' 27,210 crore in the previous year.

Profit before tax and exceptional items grew by 50% to '' 4,465 crore and the net profit grew by 53% to '' 3,333 crore.

The Watches & Wearables Division of the Company recorded a revenue of '' 3,296 crore, a growth of 43%. The revenue from Jewellery Division grew by 37% touching '' 31,897 crore (excluding sale of bullion of '' 2,208 crore). The revenue from EyeCare Division grew by 33% to '' 689 crore.

New Businesses, viz., Indian Dress Wear Division and Fragrances & Fashion Accessories Division recorded a consolidated revenue of '' 295 crore, a growth of 92% over the previous year. While the Indian Dress Wear Division grew by 168%, the Fragrances & Fashion Accessories Division also recorded a growth of 56%.

The Management Discussion and Analysis report, which is attached, dwells into the performance of each of the business divisions and the outlook for the current year.

b) Consolidated Numbers

At the consolidated level, the revenue stood at '' 40,575 crore as against '' 28,799 crore in the previous year. The details of the performance of the Company''s subsidiaries are covered below in point 15 of this Report.

2. DIVIDEND

Considering the excellent performance of the Company during the last financial year, the Board of Directors are pleased to recommend a dividend on equity shares at the rate of 1000% (i.e., '' 10 per equity share of '' 1 each), for the financial year ended 31^st March 2023 subject to approval by the Shareholders, at the ensuing Annual General Meeting (AGM) and payment is subject to deduction of tax at source as may be applicable. This payment represents a dividend payout ratio of 26.6%. The total dividend on equity shares for the financial year 2022-23, if approved by the Shareholders would aggregate to approximately '' 888 crore. The dividend, subject to the approval of Shareholders at the ensuing AGM would be paid to the Members whose names appear in the Register of Members as on the Book Closure date. The Dividend

Distribution Policy, is annexed as Annexure-III to this Report.

3. TRANSFER TO GENERAL RESERVE

As permitted under the provisions of the Companies Act, 2013 (the Act), the Board does not propose to transfer any amount to general reserve and has decided to retain the entire amount of profit for the financial year 2022-23 in the profit and loss account.

4. FINANCE

The year saw strong performance by all the businesses driven by the aggressive expansion plans across all business segments.

ICRA maintained the Company''s long term rating of AAA with stable outlook. The Company continues to optimise its efficiency in inventory management and cash flow by selling excessive bullion as and when necessary.

5. PUBLIC DEPOSITS

The Jewellery Division of the Company was successfully operating customer acquisition schemes for jewellery purchases for many years. When the Companies Act, 2013 became substantially effective on 1^st April 2014, the Company had around seven lakh subscribers contributing to these schemes. However, these schemes were exempt under the Companies Act, 1956 relating to acceptance of Public Deposits, as such schemes were not covered in the definition of Deposits. Under the Act and the Rules made thereunder (Deposit Regulations) the scope of the term "Deposit" was enlarged and therefore a view was taken that the jewellery purchase schemes offered by the Company to its customers would be treated as Public Deposits. Thereupon, the Company discontinued fresh enrolment of subscribers and initiated steps to close the erstwhile customer schemes, which were wound down in August 2014.

Under the Deposit Regulations as amended from time to time, a company is permitted to accept Deposits subject to applicable provisions, to the extent of 10% of the aggregate of the paid-up share capital, securities premium account and free reserves from its members and 25% of the aggregate of the paid-up share capital, securities premium account and free reserves from the public after prior approval by way of special resolutions passed by the members in this regard. Requisite approval was obtained from the Members of the Company and a new programme for customers to purchase jewellery (under the Jewellery Purchase Plan)

was launched in November 2014 in compliance with the Deposit Regulations.

The details relating to Deposits, covered under Chapter V of the Act are as under:

(a) accepted during the year: '' 3,890 crore

(b) remained unpaid or unclaimed as at the end of the year: '' 2,290 crore

(c) whether there has been any default in repayment of Deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved:

(i) at the beginning of the year: Nil

(ii) maximum during the year: Nil

(iii) at the end of the year: Nil

There are no Deposits that have been accepted by the Company that are not in compliance with the requirements of Chapter V of the Act.

6. MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND DATE OF REPORT

There have been no material changes and commitments for the likely impact affecting financial position between the end of the financial year and the date of the Report.

7. SIGNIFICANT AND MATERIAL ORDERS

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations in future.

8. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Act are given in the notes to the financial statements.

9. INTEGRATED REPORT

The Company has, over the last five years, taken steps to move towards Integrated Reporting in line with its commitment to voluntarily disclose more information to stakeholders on all aspects of the Company''s business. Accordingly, the Company had introduced key content elements of Integrated Reporting aligned to the International Integrated Reporting Council Framework (IIRC) in the Annual Report of the previous years and has disclosed more qualitative data in the Annual Report of this year. Similar to earlier years, the relevant information has been provided in this year''s Annual Report as well.

10. ADEQUACY OF INTERNAL CONTROLS AND COMPLIANCE WITH LAWS

During the year, the Company has reviewed its Internal Financial Control systems and has continually contributed to the establishment of a more robust and effective internal financial control framework, prescribed under the ambit of Section 134(5) of the Act. The preparation and presentation of the financial statements is pursuant to the control criteria defined considering the essential components of Internal Control - as stated in the "Guidance Note on Audit of Internal Financial Controls Over Financial Reporting" issued by the Institute of Chartered Accountants of India. The control criteria ensures the orderly and efficient conduct of the Company''s business, including adherence to its policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

Based on the assessment carried out by the Management and the evaluation of the results of the assessment, the Board of Directors are of the opinion that the Company has an adequate Internal Financial Controls system that is operating effectively as of 31^st March 2023.

There were no instances of fraud which necessitated reporting of material misstatements to the Company''s operations.

There has been no communication from regulatory agencies concerning non-compliance with or deficiencies in financial reporting practices.

11. BOARD MEETINGS

During the year under review, seven Board meetings were held, details of which are provided in the Corporate Governance Report.

12. AUDIT COMMITTEE AND OTHER BOARD COMMITTEES

The details pertaining to the composition of the Audit Committee and its role are included in the Corporate Governance Report, which is a part of this Annual Report.

13. RISK MANAGEMENT

Pursuant to the requirements of Regulation 21 and Part D of Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI LODR), the Company has constituted a Risk Management Committee (RMC), consisting of Board members and senior executives of the Company.

The Company has in place a Risk Management framework to identify, and evaluate business risks and challenges across the Company, both at the corporate level and also separately for each business division. The Company has a robust process for managing the key risks overseen by the RMC. As part of this process, the Company has identified the risks with the highest impact and then assigned a likely probability of occurrence. Mitigation plans for each risk have also been put in place and are reviewed by the Management every six months before presenting to the RMC. The RMC has set out a review process to report to the Board on the progress of the initiatives for the major risks of each of the businesses.

The Company had implemented a well-designed enterprise level Business Continuity Plan including Disaster Recovery scenario for the various businesses and functions of the Company to minimise disruptions and potential impact on its employees, customers and businesses during any unforeseen adverse events or circumstances.

14. RELATED PARTY TRANSACTIONS

I n line with the requirements of the Act and the SEBI LODR, the Company has formulated a Policy on Related Party Transactions. There are no materially significant Related Party Transactions made by the Company with Promoters, Directors or Key Managerial Personnel (KMP) which may have a potential conflict with the interests of the Company at large. All Related Party Transactions are placed before the Audit Committee for approval as per the applicable regulatory requirements, and approval of the Board, if required. Prior omnibus approval of the Audit Committee is obtained for transactions which are of foreseen and repetitive in nature. The transactions entered into pursuant to the omnibus approval so granted are verified by the Internal Auditor and a statement giving details of all Related Party Transactions is placed before the Audit Committee and the Board of Directors for their approval, if applicable, on a quarterly basis. The Policy on Related Party Transactions as approved by the Board is uploaded on the Company''s website and can be accessed at https://www.titancompany.in/investors/ corporate-governance/policies. None of the Directors have any pecuniary relationships or transactions except to the extent of sitting fees and commission paid to the Directors, except for the post-retirement benefits being paid to Mr. Bhaskar Bhat, as approved by the Board, consequent upon his retirement as Managing Director on 30^th September 2019. None of the transactions with related parties fall under the scope of Section 188(1)

of the Act and Regulation 23(4) of the SEBI LODR. The information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC-2 does not apply to the Company for the financial year 2022-23 and hence the same is not provided. The details of the transactions with related parties during the financial year 2022-23 are provided in the accompanying financial statements.

15. SUBSIDIARIES/ASSOCIATE COMPANIES

As on 31^st March 2023, the Company had the following Subsidiaries/Associate Companies:

Sl. No.	Name of the Subsidiary/ Associate Companies	Relationship
1	TCL Watches Switzerland AG (earlier known as Favre Leuba AG)	Step-down Subsidiary
2	Titan Watch Company Limited, Hong Kong	Step-down Subsidiary
3	Titan Engineering & Automation Limited (TEAL)	Wholly-owned Subsidiary
4	CaratLane Trading Private Limited (CaratLane)	Subsidiary
5	Green Infra Wind Power Theni Limited	Associate
6	Titan Holdings International FZCO, Dubai (Titan Holdings)	Wholly-owned Subsidiary
7	Titan Global Retail LLC, Dubai	Step-down Subsidiary
8	Titan Commodity Trading Limited (TCTL)	Wholly-owned Subsidiary
9	StudioC Inc., USA	Step-down Subsidiary
10	TCL North America Inc., (TCL NA)	Wholly-owned Subsidiary
11	TEAL USA Inc.	Step-down Subsidiary
12	Titan International QFZ LLC., Qatar (from 1^st December 2022)	Step-down Subsidiary

During the year under review, no Company had become or ceased to be subsidiary, joint venture or associate company.

During the financial year 2022-23, TCL Watches Switzerland AG (formerly Favre Leuba AG) (TCL WSAG) had registered a turnover of CHF 0.12 million i.e., '' 1 crore against the previous year''s figures of CHF 0.23 million, i.e., '' 2 crore and loss of CHF 0.66 million, i.e., '' 7 crore (previous year: CHF 1.25 million, i.e., '' 28 crore). During the financial year 2022-23, the Company has invested CHF 0.3 million ('' 2 crore) in TCL WSAG as share capital.

As on the date of this report, TCL WSAG is in the process of selling its brand Favre Leuba to a prospective buyer, subject to completion of certain conditions precedent. Post completion of the sale of the brand, the liquidation process would be initiated, subject to receipt of requisite approvals.

During the year under review, as part of restructuring exercise of the Company''s subsidiaries, Titan Watch Company Limited, Hong Kong ceased to be a subsidiary of TCL WSAG and became a subsidiary of Titan Holdings.

TEAL is in the business of Manufacturing Services and Automation Solutions. During the financial year 202223, TEAL generated an income of '' 580 crore against the previous year''s figures of '' 378 crore, an increase of 35% and the profit before tax was at '' 26 crore against the previous year''s figures of '' 21 crore.

CaratLane is engaged in the business of manufacturing and retailing of jewellery products and has a significant online presence. During the last year, CaratLane recorded a strong performance with double-digit growths in retail sales, with great emphasis on omnichannel selling. CaratLane added 84 stores in the year to take the store count to 222. During the financial year 2022-23, CaratLane registered a turnover of '' 2,169 crore against the previous year''s figures of '' 1,256 crore and recorded profit before tax of '' 119 crore against the previous year''s figures of '' 39 crore.

Titan Holdings was formed as a Free Zone Company in Dubai with a view to carry out business activities and invest in the share capital of any other companies/entities either as a joint venture partner or as its wholly-owned subsidiary company for carrying out business activities across UAE, GCC regions and other International markets. Titan Holdings incurred a loss of AED 2 million ('' 4 crore) against the previous year''s loss of AED 0.87 million ('' 2 crore).

Titan Global Retail LLC., carries out business activities in UAE and GCC regions pertaining to retail trade in the industry in which the Company operates. During the financial year 2022-23, Titan Global Retail LLC., registered a turnover of AED 157.70 million ('' 345 crore) against previous year''s figures of AED 55.24 million ('' 112 crore) and incurred a loss of AED 26.59 million ('' 58 crore) against the previous year''s loss of AED 11.53 million ('' 23 crore).

TCTL is a wholly-owned subsidiary of the Company and is a trading cum clearing member of Multi Commodity Exchange of India Limited and Multi Commodity Exchange Clearing Corporation Limited. TCTL is in the

business of trading in all types of direct and derived commodities, commodity futures, currencies, and other securities. During the financial year 2022-23, TCTL registered an income of '' 7.23 crore against the previous year''s figures of '' 5.21 crore and a profit before tax of '' 2.76 crore against the previous year''s figures of '' 0.95 crore. The Company avails the services of TCTL for its hedging of gold (physical and non-physical) and sale of bullion.

TCL NA is in the business of jewellery retailing in the USA. TCL NA started retail operations during financial year 2022-23 by opening its first Tanishq store in New Jersey and registered a turnover of USD 7.10 million ('' 57 crore) and a loss of USD 2.51 million ('' 20 crore).

TEAL USA Inc., a wholly-owned subsidiary of TEAL was incorporated with the objective of business development for its Manufacturing Services and Automation Solutions. The Company has not started any operations as of 31^st March 2023.

The Company holds 26.79% stake in Green Infra Wind Power Theni Limited which supplies energy to the Company.

None of these subsidiary companies declared a dividend for the financial year 2022-23.

The annual accounts of these subsidiary/associate companies were consolidated with the accounts of the Company for the financial year 2022-23. The statement containing salient features of the financial statement of subsidiaries/associate companies in Form AOC-1 forms part of the Annual Report. Pursuant to the provisions of Section 136 of the Act, the financial statements along with other relevant documents, in respect of subsidiaries, are available on the website of the Company at https:// www.titancompany.in/investors/investor-relations/ subsidiaries.

16. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under sub-section (3) (m) of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 are furnished in Annexure-I to the Board''s Report.

17. CORPORATE SOCIAL RESPONSIBILITY

In compliance with Section 135 of the Act, the Company has undertaken Corporate Social Responsibility (CSR) activities, projects and programmes as provided in the CSR Policy of the Company and as per the

Annual Action Plan, excluding activities undertaken in pursuance of its normal course of business. In addition to the projects specified as CSR activities under Section 135 of the Act, the Company has also carried out several other sustainability/responsible business initiatives and projects. The Company has spent the entire 2% of the net profits earmarked for CSR projects during the year under review and Impact Assessment has been carried out for all the projects wherever applicable. A report on CSR pursuant to Section 135 of the Act and Rules made thereunder is attached in Annexure-II.

18. ANNUAL RETURN

The Annual Return as required under Section 92 and Section 134 the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is available on the Company''s website at https:// www.titancompany.in/sites/default/files/Annual%20 Report%20FY23.pdf.

19. VIGIL MECHANISM

The Company has a whistle blower mechanism wherein the employees can approach the Management of the Company (Audit Committee in case where the concern involves the Senior Management) and make protective disclosures to the Management about unethical behaviour, actual or suspected fraud or violation of the Company''s Tata Code of Conduct and Code of Conduct to Regulate, Monitor and Report Trading by Insiders and Code of Fair Disclosure. The Whistle Blower Policy requires every employee to promptly report to the Management any actual or possible violation of these Codes or an event an employee becomes aware of, that could affect the business or reputation of the Company. The disclosures reported are addressed in the manner and within the time frames prescribed in the Policy. A mechanism is in place whereby any employee of the Company has access to the Chairman of the Audit Committee to report any concern. No person has been denied access to the Chairman of the Audit Committee to report any concerns. Further, the said Policy has been disseminated within the organisation and has also been posted on the Company''s website at https://www.titancompany.in/sites/default/files/ Whistle%20Blower%20Policy 1.pdf.

20. SECRETARIAL STANDARDS

The Directors state that the applicable Secretarial Standards i.e., SS-1 and SS-2, issued by the Institute of Company Secretaries of India, relating to Meetings of Board of Directors and General Meetings respectively, have been duly complied with.

21. DISCLOSURES AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The constant endeavour of the Company is to create a secure and safe work environment for everyone in the Company. Several means to prevent, prohibit and redress concerns are adopted by the Company. The Ethics Committee and the Committee on Prevention of Sexual Harassment (POSH) work closely with the Board Ethics Committee and obtain inputs and feedback for improvement from time to time.

Besides the core committee on POSH (having senior level representation from across the Company), 16 locational committees have been formed to ensure both spread and coverage of the implementation of the requirements of the POSH Act, 2013. The core committee has also been strengthened with more senior members being made part of it representing manufacturing locations as well.

The Policy on POSH as adopted by the Company is gender neutral, and acknowledges that today workplace is more than the premises that employees come to work and all stakeholders are ensured a safe working environment. Titan has also included the collaborations by partnering with recruiting agencies and consultants in granting recourse to aggrieved persons by forming joint Internal Complaints Committee to look into such matters. An elaboration of the penalties that could be applicable as per the Disciplinary Procedure and Policies manual and also an internal consequence guideline/ matrix and related processes has also been updated.

The Company shares best governance practices with its business associates to influence and impact more work communities. In an effort to encourage business associates to adopt the Policy for their own enterprises, masterclasses are conducted highlighting the importance of compliance and the consequences of good governance.

Communication cascades using the large scale interaction process has been restarted, storytelling as method is used and awareness is created using theatre plays on this subject. A total of 148 sessions involving 17,619 stakeholders across the Company''s ecosystem have been covered. The cascades are conducted at various cities and towns across the diverse ecosystem of the Company (manufacturing, retail, offices, vendors and partners).

As on 31^st March 2023, there were 12 complaints filed during the year on Sexual harassment, 6 of which are pending resolution at the end of the year. The remaining cases were investigated and dealt with in line with the POSH Policy of the Company and were disposed off appropriately.

22. DIVERSITY, EQUITY, INCLUSION AND BELONGING

During the year under review, the Company has embarked on an elaborate Diversity, Equity, Inclusion and Belonging programme focusing on both enhancing the Diversity quotient, besides conducting large scale awareness, building capacity and also sensitising employees across levels on the importance of gender sensitivity.

23. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12) OF SECTION 143 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

The Statutory Auditors of the Company have not reported any fraud as specified under the second proviso of Section 143(12) of the Act (including any statutory modification(s) or re-enactment(s) for the time being in force).

24. CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS

As per SEBI LODR, Management Discussion and Analysis, Corporate Governance Report and Practicing Company Secretary''s Certificate regarding compliance of conditions of Corporate Governance forms part of this Annual Report.

Pursuant to Regulation 34 of the SEBI LODR, the Management Discussion and Analysis is presented in a separate section forming part of this Annual Report. As required under the provisions of the SEBI LODR, the Audit Committee of the Company has reviewed the Management Discussion and Analysis report of the Company for the year ended 31^st March 2023.

25. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

SEBI, in May 2021 introduced new sustainability related reporting requirements to be reported in the specific format which is a notable departure from the existing Business Responsibility Report and a significant step towards giving platform to the companies to report the initiatives taken by them in areas of environment, social and governance. Further, SEBI has mandated top

1,000 listed companies, based on market capitalization, to transition to Business Responsibility and Sustainability Reporting from the financial year 2022-23 onwards. In line with the above, the Business Responsibility and Sustainability Report forms part of this Report and is also available on the Company''s website.

26. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. Ashwani Puri, Mr. B Santhanam, Mr. Pradyumna Vyas, Dr. Mohanasankar Sivaprakasam, Ms. Sindhu Gangadharan and Mr. Sandeep Singhal were the Independent Directors during the entire financial year 2022-23.

Mr. B Santhanam was appointed as an Independent Director for the first term of five years effective 3 ^rd August 2018 and accordingly, his office of directorship ceases on 2^nd August 2023. The Board based on the recommendations of the Board Nomination and Remuneration Committee (BNRC) and pursuant to the performance evaluation of Mr. B Santhanam as a Member of the Board and considering that the continued association of Mr. B Santhanam would be beneficial to the Company, recommended to re-appoint Mr. B Santhanam as an Independent Director of the Company, not liable to retire by rotation, for a second term effective 3^rd August 2023 up to 9^th May 2028.

Based on the disclosures received from all Independent Directors, as laid under Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI LODR and also in the opinion of the Board, the Independent Directors fulfill the conditions as specified in the Act and SEBI LODR and are independent of the Management and that they are not debarred from holding the office of director by virtue of any SEBI order or any other such authority. All the Independent Directors have confirmed that they are in compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to registration with the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

In accordance with the provisions of the Act and in terms of the Memorandum and Articles of Association of the Company, Mr. Bhaskar Bhat is liable to retire by rotation at the ensuing Annual General Meeting and has offered himself for re-appointment.

During the year under review, Tamilnadu Industrial Development Corporation Limited (TIDCO) had

withdrawn the nomination of Mr. Pankaj Kumar Bansal, IAS and had nominated Ms. Mariam Pallavi Baldev, IAS.

The Board placed on record its appreciation and recognised the valuable contribution rendered by Mr. Pankaj Kumar Bansal, IAS during his tenure as member of the Board.

Members'' attention is drawn to Item No. 4 of the Notice for the re-appointment of Mr. Bhaskar Bhat as a NonIndependent, Non-Executive Director of the Company, liable to retire by rotation and Item No.5 of the Notice for the re-appointment of Mr. B Santhanam as an Independent Director of the Company for a second term.

None of the Directors are related to each other within the meaning of the term "Relative" as per Section 2(77) of the Act.

27. DETAILS OF KEY MANAGERIAL PERSONNEL

None of the Key Managerial Personnel were appointed or resigned during the year. Pursuant to the provisions of Section 203 of the Act, Mr. C K Venkataraman -Managing Director, Mr. Ashok Sonthalia - Chief Financial Officer and Mr. Dinesh Shetty - General Counsel and Company Secretary are the Key Managerial Personnel of the Company.

28. DIRECTORS'' RESPONSIBILITY STATEMENT

Based on the framework of Internal Financial Controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including audit of internal financial control over financial reporting by the statutory auditors and the reviews performed by the Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company''s internal financial controls are adequate and operating effectively.

Accordingly, pursuant to the requirements of Section 134 (5) of the Act, the Directors hereby confirm that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

ii. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. they have prepared the annual accounts on a going concern basis;

v. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

29. BOARD EVALUATION

The Company is led by a diverse, experienced and competent Board. The performance evaluation of the Board, Committees of the Board and the individual members of the Board (including the Chairman) for financial year 2022-23, was carried out internally pursuant to the framework laid down by the BNRC. This was based on a structured questionnaire which cover various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Member''s strengths and contribution, execution and performance of specific duties, obligations and governance and feedback from each Director.

The Independent Directors at their separate meeting, review the performance of Non-Independent Directors and the Board as a whole and the Chairman of the Company after taking into account the views of Executive Director and Non-Executive Directors, the quality, quantity and timeliness of flow of information between the Management and the Board that is necessary for the Board to effectively and reasonably perform their duties. The Chairman of the BNRC leads the performance evaluation exercise. The outcome of the performance evaluation of Committees and the Board is presented to the Board of Directors of the Company and the key outcomes are discussed and acted upon.

30. INDEPENDENT DIRECTORS MEETING

A separate meeting of the Independent Directors (Annual ID Meeting) was convened, which reviewed the performance of the Board (as a whole), the

Non-Independent Directors and the Chairman. The Independent Directors inter-alia discuss the issues arising out of Committee meetings and Board discussions including the quality, quantity and timely flow of information between the Management and the Board that is necessary for the Board to effectively and reasonably perform their duties. Post the Annual ID Meeting, the collective feedback of each of the Independent Directors was discussed by the Chairman of the BNRC with the Board covering the performance of the Board as a whole, the performance of the Non-Independent Directors and the performance of the Chairman of the Board.

31. REMUNERATION POLICY

The Board has, on the recommendation of the BNRC, framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy forms part of the Corporate Governance Report.

The remuneration to the Non-Executive Directors and Senior Management Employees consists of various components as explained here.

Non-Executive Directors

The Non-Executive Directors shall be entitled to receive remuneration by way of sitting fees, reimbursement of expenses, for participation in the Board/Committee meetings and Commission.

Senior Management Employees

The remuneration is divided into two components viz; fixed component of salaries, perquisites and retirement benefits and variable component of performance based incentive.

32. EMPLOYEE STOCK OPTION PLAN - PERFORMANCE BASED STOCK UNITS

With an objective to achieve sustained growth and to create shareholder value by aligning the interests of the employees with long term interest of the Company, during the financial year 2022-23, the Company had

sought approval of the Members through Postal Ballot Notice dated 10^th February 2023 for the adoption and implementation of the Titan Company Limited Performance Based Stock Unit Scheme (Scheme 2023) to the eligible employees of the Company and its subsidiaries. The Members, vide special resolution passed through Postal Ballot on 21^st March 2023, approved the adoption and implementation of the Scheme 2023 and BNRC is the administrator of the Scheme 2023. During the year under review, the Company has not granted any Performance Based Stock Units to the eligible employees in terms of Scheme 2023.

The details of the Scheme 2023, including terms of reference, and the requirement specified under Regulation 14 of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, are available on the Company''s website at https://www.titancompany. in/sites/default/files/ESOP%20disclosure 0.pdf.

33. POLICY ON DIRECTORS'' APPOINTMENT AND REMUNERATION AND OTHER DETAILS

In accordance with the Joint Venture Agreement between the Promoters, three Directors each may be nominated by Tata Sons Private Limited and Tamilnadu Industrial Development Corporation Limited. The broad guidelines for selection of Independent Directors are as set out below:

The BNRC oversees the Company''s nomination process for Independent Directors and in that connection identifies, screens and reviews individuals qualified to serve as an Independent Director on the Board. The BNRC further has in place a process for selection and the attributes that would be desirable in a candidate and as and when a candidate is shortlisted, the BNRC will make a formal recommendation to the Board.

34. OTHER DISCLOSURES

The information required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

i) The ratio of the remuneration of each Director to the median remuneration of the employees of the Company and the percentage increase in remuneration of each Director, Managing Director, Chief Financial Officer and Company Secretary in the financial year:

Name of the Director	Ratio (Times)	% change
Director''s remuneration
Mr. S Krishnan	8.99	NA
Ms. Jayashree Muralidharan	8.95	NA
Mr. Pankaj Kumar Bansal¹	3.19	NA
Ms. Mariam Pallavi Baldev¹	3.12	NA

Notes:

¹ The % change in remuneration is not comparable as the said Directors/KMP held the position for a part of the year either in financial year 2021-22 or in financial year 2022-23.

The Directors'' remuneration includes the Commission for the year under reporting and payable in financial year 2023-24 post the ensuing Annual General Meeting.

Name of the Director	Ratio (Times)	% change
Mr. N N Tata	9.49	NA
Mr. Bhaskar Bhat	11.42	19.69
Mr. Ashwani Puri	16.31	17.80
Mr. B Santhanam	15.58	30.30
Mr. Pradyumna Vyas	12.09	41.85
Dr. Mohanasankar Sivaprakasam	13.25	20.12
Ms. Sindhu Gangadharan	11.26	25.49
Mr. Sandeep Singhal	16.38	61.04
Mr. C K Venkataraman	156.87	9.80
Key Managerial Personnel
Mr. Ashok Sonthalia¹	-	NA
Mr. Dinesh Shetty	-	8.00

ii) The percentage increase in the median remuneration of employees in the financial year: 10%

iii) The number of permanent employees on the rolls of Company: 7,857

iv) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

The average percentage increase for the financial year 2022-23 was 10% across all levels. Increase in the managerial remuneration is based on market trends and performance criteria as determined by the Board of Directors and on the basis of the recommendation of the BNRC.

v) Affirmation that the remuneration is as per the Remuneration Policy of the Company:

The Company''s Remuneration Policy is based on the principle of internal equity, competence and experience of the employee and industry standards. Through its compensation programme, the Company endeavours to attract, retain, develop and motivate high performance and engaged workforce. The Company follows a compensation mix of fixed pay, benefits and performance based variable pay. Individual performance pay is determined by business performance and the performance of the individuals is measured through the annual appraisal process. The Company affirms that remuneration is as per the Remuneration Policy of the Company.

35. INFORMATION AS PER RULE 5(2) OF THE CHAPTER XIII, OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014

The statement containing particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Rules forms part of this Report. Further, the Report and the Accounts are being sent to the Members excluding the aforesaid statement. In terms of Section 136 of the Act, the said statement will be open for inspection upon request by the Members. Any Member interested in obtaining such particulars may write to the Company Secretary.

36. AUDITORS

a) Statutory Auditors

Pursuant to the provisions of Section 139 of the Act read with applicable Rules framed thereunder, M/s. B S R & Co., LLP have been appointed as Auditors for a term of five years from the conclusion of the 38^th Annual General Meeting till the conclusion of the 43^rd Annual General Meeting.

The Ministry of Corporate Affairs vide Notification dated 7^th May 2018 notified several Sections of the Companies (Amendment) Act, 2017. In view of the said notification, the requirement of ratification of appointment of auditors, under Section 139 of the Act at each AGM is no longer required. Hence, the resolution for this item is not being included in the Notice to the AGM.

b) Secretarial Audit and Auditors

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed V. Sreedharan & Associates, Practicing Company Secretaries to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is annexed herewith as Annexure-IV.

c) Cost Audit

The Company is not required to maintain cost records as per sub-section (1) of Section 148 of the Act.

37. GENERAL DISCLOSURE

During the year, there were no transactions

requiring disclosure or reporting in respect of

matters relating to:

a) i ssue of equity shares with differential rights as to dividend, voting or otherwise;

b) i ssue of shares (including sweat equity shares) to employees of the Company under any scheme;

c) raising of funds through preferential allotment or qualified institutions placement;

d) significant or material order passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future;

e) pendency of any proceedings under the Insolvency and Bankruptcy Code, 2016; and

f) i nstance of one-time settlement with any bank or

financial institution.

38. AUDITOR''S REPORT AND SECRETARIAL AUDITOR''S REPORT

The Auditors'' Report on the financial statements of the Company for the financial year ended 31^st March 2023 is unmodified, i.e., it does not contain any qualifications, reservations, adverse remarks or disclaimers. The Auditor''s Report is enclosed with the financial statements forming part of the Annual Report.

There are no disqualifications, reservations, adverse remarks, or disclaimers in the Secretarial Auditor''s Report.

39. DISCLOSURES OF TRANSACTIONS OF THE LISTED ENTITY WITH ANY PERSON OR ENTITY BELONGING TO THE PROMOTER/PROMOTER GROUP WHICH HOLD(S) 10% OR MORE SHAREHOLDING IN THE LISTED ENTITY, IN THE FORMAT PRESCRIBED IN THE RELEVANT ACCOUNTING STANDARDS FOR ANNUAL RESULTS

Related Party Transactions with Promoter/Promoter Group holding 10% or more shares

Tamilnadu Industrial Development Corporation Limited and Tata Sons Private Limited hold 10% or more shares in the Company. The details of transactions with promoter/ promoter group holding 10% or more shares have been disclosed in the financial statements which is part of the Annual Report.

The details of the transactions with related parties during financial year 2022-23 are provided in the accompanying financial statements. There were no transactions during the year which would require to be reported in Form AOC-2.

Acknowledgements

Your Directors wish to place on record their appreciation for the commitment extended by the employees of the Company and its subsidiaries during the year. Further, the Directors also wish to place on record the support which the Company has received from its promoters, shareholders, bankers, business associates, vendors and customers of the Company.

Mar 31, 2022

The Directors are pleased to present the Thirty-Eighth Annual Report and the Audited Financial Statements for the year ended 31^st March 2022:

1. Financial Results

('' in crore)
	Standalone		Consolidated
	2021-2022	2020-2021	2021-2022	2020-2021
Revenue from Operations	27,210	20,602	28,799	21,644
Other Income	246	181	234	186
Total Income	27,456	20,783	29,033	21,830
Expenditure	23,931	18,901	25,458	19,920
Profit before exceptional items, finance costs, depreciation and taxes	3,525	1,882	3,575	1,910
Finance Costs	195	181	218	203
Depreciation/Amortisation	347	331	399	375
Profit before share of profit/(loss) of an associate and joint venture and exceptional items and taxes	2,983	1,370	2,958	1,332
Share of profit/(loss) of an associate and Jointly controlled entity	-	-	-	(5)
Profit before exceptional items and taxes	2,983	1,370	2,958	1,327
Exceptional items	51	137	54	-
Profit before taxes	2,932	1,233	2,904	1,327
Income taxes
- Current	779	351	786	360
- Deferred	(27)	5	(80)	(7)
Profit for the year	2,180	877	2,198	974
Attributable to
- Shareholders of the Company	2,180	877	2,173	973
- Non-controlling interests	-	-	25	1
Profit brought forward	4,279	3,757	4,210	3,592
Appropriations
Dividend on Equity Shares (excluding tax)	(355)	(355)	(355)	(355)
Closing Balance in Retained Earnings	6,104	4,279	6,028	4,210

1 a) Standalone Numbers:

During the year under review, the Company''s total revenue grew by 32% to '' 27,210 crore compared to '' 20,602 crore in the previous year.

Profit before tax and exceptional items grew by 118% to '' 2,983 crore and the net profit grew by 149% to '' 2,180 crore.

The Watches & Wearables Division of the Company recorded revenue of '' 2,309 crore, a growth of 46%. The revenue from Jewellery Division grew by 35% touching '' 23,268 crore (excluding sale of bullion of '' 1,045 crore). The revenue from EyeCare Division grew by 38% to '' 517 crore.

New Businesses, viz. Indian Dress Wear Division and Fragrances & Fashion Accessories Division recorded revenue of '' 154 crore, a growth of 57% over the previous year. While the Indian Dress Wear Division grew by 43%, and the Fragrances & Fashion Accessories Division also recorded a growth of 65%.

All the Divisions have done very well during the year amidst various challenges.

The Management Discussion and Analysis report, which is attached, dwells into the performance of each of the business divisions and the outlook for the current year.

b) Consolidated Numbers

At the consolidated level, the revenue stood at '' 28,799 crore as against '' 21,644 crore in the previous year. The details of the performance of the Company''s subsidiaries are covered below in point 17 of this Report.

2. Company''s Response to COVID- 19

The Company witnessed strong demand across its consumer businesses with the major businesses achieving significant revenue uplift and ending the year on a strong note. The underlying demand continued to be strong across all of its businesses with most segments posting Y-o-Y growth over a very strong base from the fourth quarter of the previous year. The network expansion and marketing campaigns have progressed very well during the year under reporting.

However, during the first quarter of the year, the Company''s focus was back on keeping everyone safe and few stores were proactively closed in the highly impacted towns. The initiative of customer outreach that brought in sales in the previous year was also not

undertaken considering that the humanitarian impact on consumers was severe and widespread during the second wave of the pandemic.

The Company drove vaccination campaigns as the top priority and almost all the store staff and employees got at least their first dose during June - September 2021 period, which was an important step towards bringing back normalcy.

During the second quarter, the Company witnessed a strong recovery in demand after the second wave across its consumer businesses with sales moving swiftly above or close to pre-pandemic levels in most of the Divisions. Most stores were fully operational, barring a few in select towns having localized restrictions, with overall store operation days exceeding 90% for the quarter. Apart from its thrust on digital and omnichannel, the Company also accelerated its retail network expansion during the second quarter.

The Company finished the year on a satisfactory note despite the last quarter of the year getting disrupted twice - first due to the partial lockdowns caused by the Omicron wave in January and again during the month of March in which consumer sentiments got affected adversely due to sharp increase and volatility in gold prices and uncertainty due to a fragile geopolitical situation. The underlying demand continued to be strong across all of its businesses with most segments posting growth over a very strong base in the last quarter of the previous year.

3. Dividend

Considering the excellent performance of the Company during the last financial year, the Board of Directors are pleased to recommend the payment of dividend on equity shares at the rate of 750% (i.e. '' 7.50 per equity share of '' 1 each), subject to approval by the shareholders, at the ensuing Annual General Meeting ("AGM") and payment is subject to deduction of tax at source as may be applicable. This payment represents a dividend payout ratio of 30.8%. The Dividend Distribution Policy, as amended by the Board at its meeting held on 29^thApril 2021, is annexed as Annexure-III to this Report.

4. Transfer to General Reserve

As permitted under the provisions of the Companies Act, 2013, the Board does not propose to transfer any amount to general reserve and has decided to retain the entire amount of profit for the Financial Year 2021-22 in the profit and loss account.

5. Finance

The year saw an excellent performance by all the businesses despite challenges of partial lockdowns and uncertainty in a fragile geopolitical situation during the year.

6. Public Deposits

The Jewellery Division of the Company was successfully operating customer acquisition schemes for jewellery purchases for many years. When the Companies Act, 2013 (the "Act") became substantially effective on 1^st April 2014, the Company had around seven lakh subscribers contributing to these schemes. However, these schemes were exempt under the Companies Act, 1956 relating to acceptance of public deposits, as such schemes were not covered in the definition of deposits. Under the Act and the Rules made thereunder (''Deposit Regulations'') the scope of the term "deposit" was enlarged and therefore a view was taken that the jewellery purchase schemes offered by the Company to its customers would be treated as public deposits. Thereupon, the Company discontinued fresh enrolment of subscribers and initiated steps to close the erstwhile customer schemes, which were wound down in August 2014.

Under the Deposit Regulations as amended from time to time, a company is permitted to accept deposits subject to applicable provisions, to the extent of 10% of the aggregate of the paid-up share capital, securities premium account and free reserves from its Members & 25% of the aggregate of the paid-up share capital, securities premium account and free reserves from the Public after prior approval by way of special resolutions passed by the Members in this regard. Requisite approval was obtained from the Members of the Company and a new programme for customers to purchase jewellery (under the Jewellery Purchase Plan) was launched in November 2014 in compliance with the Deposit Regulations.

The details relating to deposits, covered under Chapter V of the Act are as under:

(a) accepted during the year: '' 2,701 crore

(b) remained unpaid or unclaimed as at the end of the year: '' 1,574 crore

(c) whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved-

(i) at the beginning of the year : Nil

(ii) maximum during the year : Nil

(iii) at the end of the year : Nil

There are no deposits that have been accepted by the Company that are not in compliance with the requirements of Chapter V of the Act.

7. Material Changes and Commitments Affecting Financial Position between the end of the Financial Year and Date of Report

There have been no material changes and commitments for the likely impact affecting financial position between the end of the financial year and the date of the Report.

8. Significant and Material Orders

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations in future.

9. Particulars of Loans, Guarantees and Investments

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Act are given in the notes to the financial statements.

During the year under review, the Company had invested '' 8 crore (CHF 1 million) as application money towards equity stake in Favre Leuba AG (FLAG). The Company had also invested '' 1 crore (USD 0.15 million) as subscription to Equity Share capital and '' 160 crore (USD 20 million) as application money towards equity stake in TCL North America Inc., a wholly owned subsidiary formed during the year.

10. Integrated Report

The Company has, over the last four years, taken steps to move towards Integrated Reporting in line with its commitment to voluntarily disclose more information to stakeholders on all aspects of the Company''s business. Accordingly, the Company had introduced key content elements of Integrated Reporting aligned to the International Integrated Reporting Council Framework (IIRC) in the Annual Report of the previous years and has disclosed more qualitative data in the Annual Report of this year. Similar to earlier years, the relevant information has been provided in this year''s Annual Report as well.

11. Adequacy of Internal Controls and Compliance with Laws

The control criteria ensure the orderly and efficient conduct of the Company''s business, including adherence to its policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

There were no instances of fraud which necessitated reporting of material misstatements to the Company''s operations.

There has been no communication from regulatory agencies concerning non-compliance with or deficiencies in financial reporting practices.

12. Board Meetings

During the year under review, nine Board meetings were held, details of which are provided in the Corporate Governance Report.

13. Audit Committee and other Board Committees

The details pertaining to the composition of the Audit Committee and its role are included in the Corporate Governance Report, which is a part of this Annual Report. In addition to the Committees mentioned in the Corporate Governance Report, the Company has a Corporate Social Responsibility Committee, the details of which are covered in Annexure-II to this Report.

14. Risk Management

Pursuant to the requirements of Regulation 21 and Part D of Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI LODR),

the Company has constituted a Risk Management Committee (RMC), consisting of Board members and senior executives of the Company.

The Company has in place a Risk Management framework to identify, and evaluate business risks and challenges across the Company, both at the corporate level as also separately for each business division. The Company has a robust process for managing the top risks, overseen by the RMC. As part of this process, the Company has identified the risks with the highest impact and then assigned a likely probability of occurrence. Mitigation plans for each risk have also been put in place and are reviewed by the Management every six months before presenting to the RMC. The RMC has set out a review process to report to the Board on the progress of the initiatives for the major risks of each of the businesses. The Company has also engaged a reputed firm to design an enterprise level Business Continuity Plan including Disaster Recovery scenario, considering the increasing size and complexity of the various businesses of the Company.

15. Related Party Transactions

There are no materially significant Related Party Transactions made by the Company with Promoters, Directors or Key Managerial Personnel which may have a potential conflict with the interests of the Company at large. All Related Party Transactions are placed before the Audit Committee for approval of Independent Directors of the Company and the Board for approval, if required. Prior omnibus approval of the Audit Committee is obtained for transactions which are of a foreseen and repetitive in nature. The transactions entered into pursuant to the omnibus approval so granted are verified by the Internal Auditor and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval, if applicable, on a quarterly basis. The Company has developed an Internal Guide on Related Party Transactions Manual and prescribed Standard Operating Procedures for the purpose of identification and monitoring of such transactions. The Policy on Related Party Transactions as approved by the Board is uploaded on the Company''s website. None of the Directors have any pecuniary relationships or transactions except to the extent of sitting fees and commission paid to the Directors and to Mr. Bhaskar Bhat to whom the Company pays monthly pension as approved by the Board of Directors consequent upon his retirement as Managing Director of the Company in the month of September 2019. The details of the transactions with related parties during the year under review are

provided in the accompanying financial statements. There were no transactions during the year under review which would require to be reported in Form AOC-2.

16. Subsidiaries/Joint Venture/Associate Company

As on 31^st March 2022, the Company had the following subsidiaries/Associate/Joint Venture:

Sl. No.	Name of the Subsidiary/ Associate/Joint Venture	Relationship
1	Favre Leuba AG, Switzerland (FLAG)	Subsidiary
2	Titan Watch Company Limited, Hong Kong	Step-down Subsidiary
3	Titan Engineering & Automation Limited (TEAL)	Subsidiary
4	CaratLane Trading Private Limited (CaratLane)	Subsidiary
5	Green Infra Wind Power Theni Limited	Associate
6	Titan Holdings International FZCO, Dubai	Subsidiary
7	Titan Global Retail LLC, Dubai	Step-down Subsidiary
8	Titan Commodity Trading Limited	Subsidiary
9	TCL North America Inc. (from 15^th April 2021)	Subsidiary
10	TEAL USA Inc. (from 15^th April 2021)	Step-down Subsidiary
11	StudioC Inc., USA	Step-down Subsidiary

During the Financial Year 2021-22, Favre Leuba AG had registered a turnover of CHF 0.23 million i.e., '' 2 crore against the previous year''s figures of CHF 1.04 million,

i.e., '' 8 crore and loss of CHF 1.25 million, i.e., '' 28 crore (previous year: CHF 7.34 million, i.e., '' 58 crore). During the Financial Year 2021-22, the Company has invested CHF 1 million ('' 8 crore) in Favre Leuba AG as share application money.

Titan Watch Company Limited is a subsidiary of Favre Leuba AG and hence is a step-down subsidiary of the Company. It has a capital of HK $ 10,000 and no Profit and Loss Account has been prepared.

During the Financial Year 2021-22, TEAL generated an income of '' 378 crore against the previous year''s figures of '' 354 crore, an increase of 7% and the profit before tax was at '' 21 crore against the previous year''s figures of '' 40 crore.

CaratLane is engaged in the business of manufacturing and retailing of jewellery products and has a significant

online presence. During the last year, CaratLane''s performance was very good with strong double-digit growths recorded in retail sales, with great emphasis on omnichannel selling. CaratLane added 21 stores in the year to take the store count to 138. During the Financial Year 2021-22, CaratLane registered a turnover of '' 1,256 crore (previous year: '' 716 crore) and recorded profit before taxes of '' 39 crore as against the previous year''s figures of '' 2 crore.

Titan Holdings International FZCO (Titan Holdings) was formed as a Free Zone Company with a view to carry out business activities and invest in the share capital of any other companies/entities either as a joint venture partner or as its wholly-owned subsidiary company for carrying out business activities. Titan Holdings incurred a loss of AED 0.87 million ('' 2 crore) against the previous year''s loss of AED 0.60 million ('' 1 crore).

During the Financial Year 2021-22, Titan Global Retail LLC registered a turnover of AED 55.14 million ('' 112 crore) (previous year AED 19.20 million - '' 39 crore) and incurred a loss of AED 11.53 million ('' 23 crore) against the previous year''s loss of AED 2.47 million ('' 5 crore).

During the Financial Year 2021-22, Titan Commodity Trading Limited (TCTL) commenced operations of hedging of gold for Titan. TCTL registered an income of '' 5.21 crore and a profit before tax of '' 0.95 crore.

TCL North America Inc., was incorporated during the year as a wholly-owned subsidiary. However, the company has not started any operations as of 31^st March 2022.

TEAL USA Inc., was incorporated during the year as a wholly-owned subsidiary of Titan Engineering & Automation Limited. However, the company has not started any operations as of 31^st March 2022.

The Company holds 26.79% stake in Green Infra Wind Power Theni Limited which supplies energy to the Company.

None of these subsidiary companies declared a dividend for the Financial Year 2021-22.

The annual accounts of these subsidiary companies/JV companies were consolidated with the accounts of the Company for the Financial Year 2021-22.

The statement containing salient features of the financial statement of subsidiaries/associate company/joint venture in Form AOC-1 forms part of the Annual Report.

17. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

The particulars as prescribed under sub-section (3) (m) of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 are furnished in Annexure-I to the Board''s Report.

18. Corporate Social Responsibility (CSR)

In compliance with Section 135 of the Act, the Company has undertaken CSR activities, projects and programs as provided in the CSR Policy of the Company and as per the Annual Action Plan, and excluding activities undertaken in pursuance of its normal course of business. In addition to the projects specified as CSR activities under Section 135 of the Act, the Company has also carried out several other sustainability/responsible business initiatives and projects. The Company has spent the entire 2% of the net profits earmarked for CSR projects during the year under review. A report on CSR pursuant to Section 135 of the Act and Rules made thereunder is attached in Annexure-II.

19. Annual Return

The Annual Return as required under Section 92 and Section 134 the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is available on the Company''s website at - https://www.titancompanv. in/sites/default/files/MGT-7.pdf.

20. Vigil Mechanism

The Company has a whistle blower mechanism wherein the employees can approach the Management of the Company (Audit Committee in case where the concern involves the Senior Management) and make protective disclosures to the Management about unethical behaviour, actual or suspected fraud or violation of the Company''s Code of Conduct and Insider Trading Code. The Whistle Blower Policy requires every employee to promptly report to the Management any actual or possible violation of the Code or an event an employee becomes aware of, that could affect the business or reputation of the Company. The disclosures reported are addressed in the manner and within the time frames prescribed in the Policy. A mechanism is in place whereby any employee of the Company has access to the Chairman of the Audit Committee to report any concern. No person has been denied access to the Chairman to report any concerns. Further, the said policy has been disseminated within the organisation and has also been posted on the Company''s website at https://www.titancompany.in/sites/default/files/ Whistle%20Blower%20Policy 1.pdf.

21. Secretarial Standards

22. Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

In a continuous effort to sustain the respectful and safe work culture at the Company, various means to prevent, prohibit and redress concerns are adopted by the Company.

The Ethics Committee and the Committee on Prevention of Sexual Harassment (POSH) work closely with the Board Ethics Committee and obtains inputs and feedback for improvement from time to time.

Besides the core committee on POSH (having senior-level representation from across the Company), 16 locational committees have been formed to ensure both spread and coverage of the implementation of the requirements of the POSH Act, 2013.

The Policy acknowledges the virtual workplaces that are a norm and all stakeholders are ensured a safe working environment in such remote conditions as well. Titan has also included the collaborations by partnering with associated companies (manpower agencies, consultants) in granting recourse to aggrieved persons by forming joint Internal Complaints Committee to look into such matters. An elaboration of the penalties that could be applicable as per the Disciplinary Procedure and Policies manual and related processes has also been updated.

The virtual communication cascades by using innovative radio plays to heighten awareness on this subject continues to be conducted regularly across the diverse ecosystems of the Company (manufacturing, retail and offices, vendors and partners) covering a total of 50 sessions involving 6,226 stakeholders across the board.

During the year under reporting, the Company received 7 complaints on sexual harassment, all were disposed-off with appropriate action taken as on 31^st March 2022.

23. Details in Respect of Frauds Reported by Auditors Under Sub-Section (12) of Section 143 other than those which are Reportable to the Central Government

24. Corporate Governance and Management Discussion and Analysis

25. Business Responsibility Report

As stipulated under the SEBI LODR, the Business Responsibility Report (BRR) describing the initiatives undertaken by the Company from an environment, social and governance perspective is attached and forms part of this Annual Report.

26. Directors and Key Managerial Personnel

Mr. Ashwani Puri, Mr. B Santhanam, Mr. Pradyumna Vyas, Dr. Mohanasankar Sivaprakasam Ms. Sindhu Gangadharan and Mr. Sandeep Singhal were the Independent Directors during the entire Financial Year 2021-22.

All the Independent Directors have given declarations that they continue to meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 16(1 )(b) of the SEBI LODR and that they are not debarred from holding the office of director by virtue of any SEBI order or any other such authority. All the Independent Directors have confirmed that they are in compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules,

2014, with respect to registration with the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

In accordance with the provisions of the Act and in terms of the Memorandum and Articles of Association of the Company, Mr. N N Tata retires by rotation at the ensuing Annual General Meeting and has offered himself for re-appointment.

During the course of the year under review, Tamilnadu Industrial Development Corporation Limited (TIDCO) had withdrawn the nominations of Mr. Arun Roy and Mr. N Muruganandam as its nominee directors and had nominated Ms. Jayashree Muralidharan and Mr. S Krishnan in their place.

The Board placed on record its appreciation for the valuable contribution and wise counsel rendered by Mr. N Muruganandam and Mr. Arun Roy during their tenure as members of the Board.

Members'' attention is drawn to Item No. 4 of the Notice for the re-appointment of Mr. N N Tata as a Director of the Company, liable to retire by rotation, Item No. 6 of the Notice for the appointment of Mr. S Krishnan as a Director of the Company, liable to retire by rotation, and Item No.7 of the Notice for the appointment of Ms. Jayashree Muralidharan as a Director of the Company, liable to retire by rotation.

None of the Directors are related to each other within the meaning of the term "Relative" as per Section 2(77) of the Act.

27. Details of Key Managerial Personnel who were appointed or have resigned during the year

Pursuant to the provisions of Section 203 of the Act, Mr. C K Venkataraman - Managing Director, Mr. Ashok Sonthalia - Chief Financial Officer and Mr. Dinesh Shetty - General Counsel & Company Secretary are the Key Managerial Personnel of the Company. Mr. S Subramaniam retired from the services of the Company at the close of business hours on 30^th June 2021 and Mr. Ashok Sonthalia took over as the Chief Financial Officer effective 1^st July 2021.

28. Directors'' Responsibility Statement

over financial reporting by the statutory auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company''s internal financial controls are adequate and operating effectively.

Accordingly, pursuant to the requirements of Section 134 (5) of the Act, the Directors hereby confirm that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

ii. t hey have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iv. they have prepared the annual accounts on a going concern basis;

v. t hey have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

29. Board Evaluation

The performance evaluation of the Board, its Committees and individual Directors was conducted by the Board Nomination and Remuneration Committee (BNRC) and the Board. This was based on questionnaire responses and feedback from each Director. Based on the questionnaire, the performance of every Director was evaluated by the BNRC and presentation was made to the Board and an action plan was drawn accordingly.

The overall recommendations based on the evaluation were discussed by the Board and individual feedback from Directors was taken on record. The discussion quality was robust, well intended and led to clear direction and decision. Based on the outcome of the

evaluation, assessment and feedback of the Directors, the Board and the Management have agreed on various action points that would be implemented as per the agreed timelines. It was noted that the Board Committees function professionally and smoothly, and besides the Board Committees'' terms of reference as mandated by law, important issues are brought up and discussed in the respective Board Committees. Progress on recommendations from last year and the current year''s recommendations were discussed. Apart from the other key matters, the aspects of succession planning and committee composition were also discussed.

30. Independent Directors

A separate meeting of the Independent Directors ("Annual ID Meeting") was convened, which reviewed the performance of the Board (as a whole), the NonIndependent Directors and the Chairman. On an overall basis, the Independent Directors were highly satisfied with the functioning of the Board and its various Committees and the high level of commitment and engagement. Apart from this, the Independent Directors also appreciated the commitment and contributions of the Chairman and Vice Chairman of the Board in dealing with the Board matters as well as key strategic matters. Post the Annual ID Meeting, the collective feedback of each of the Independent Directors was discussed by the Chairperson of the BNRC with the Board covering the performance of the Board as a whole, the performance of the non-independent directors and the performance of the Chairman of the Board. The Board also suggested certain areas which require more focused attention from the Management of the Company in the current financial year.

31. Remuneration Policy

The remuneration to the Non-Executive and Senior Management Employees consists of various components as explained here.

Non - Executive Directors

The Non-Executive Directors shall be entitled to receive remuneration by way of sitting fees, reimbursement of expenses, for participation in the Board/Committee meetings and Commission.

Senior Management Employees

The remuneration is divided into two components viz; fixed component of salaries, perquisites and retirement benefits and variable component of performance based incentive.

32. Policy on Directors'' Appointment and Remuneration and other Details

In accordance with the Joint Venture Agreement between the Promoters, three Directors each may be nominated by Tata Sons Private Limited and Tamilnadu Industrial Development Corporation Limited.

The guidelines for selection of Independent Directors are as set out below:

The Board Nomination and Remuneration Committee oversees the Company''s nomination process for Independent Directors and in that connection identifies, screens and reviews individuals qualified to serve as an Independent Director on the Board. The BNRC further has in place a process for selection and the attributes that would be desirable in a candidate and as and when a candidate is shortlisted, the BNRC will make a formal recommendation to the Board.

33. Other Disclosures

The information required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

Sl. No.	Name of the director	Ratio (times)	% change
A]	Director''s remuneration
1	Chairman¹	5.90	NA
2	Mr. Arun Roy¹	2.40	NA
3	Ms. Kakarla Usha¹	0.84	NA
4	Ms. Jayashree Muralidharan¹	5.67	NA
5	Mr. Pankaj Kumar Bansal¹	6.08	NA
6	Mr. N N Tata¹	2.78	NA
7	Mr. Bhaskar Bhat	8.44	152.16
8	Mr. Ashwani Puri	12.25	154.31
9	Mr. B Santhanam	10.57	137.62
10	Mr. Pradyumna Vyas	7.54	166.50
11	Dr. Mohanasankar Sivaprakasam	9.76	146.88
12	Ms. Sindhu Gangadharan¹	7.94	NA
13	Mr. Sandeep Singhal¹	9.00	NA
14	Mr. C K Venkataraman	125.16	48.55
B]	Key Managerial Personnel
15	Mr. S Subramaniam²	-	-
16	Mr. Ashok Sonthalia²	-	-
16	Mr. Dinesh Shetty	-	15%

¹ The % change in remuneration is not comparable as the said directors held the position for a part of the year either in 202021 or in 2021-22.

ii) The percentage increase in the median remuneration of employees in the financial year:

iii) The number of permanent employees on the rolls of Company: 7,263

The average percentage increase for the Financial Year 2021-22 was 7% across all levels. Increase in the managerial remuneration is based on market trends and performance criteria as determined by the Board of Directors and on the recommendation of the BNRC.

v) Affirmation that the remuneration is as per the Remuneration Policy of the Company:

34. I nformation as per Rule 5(2) of the Chapter XIII, of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

35. Auditors

a) Statutory Auditors

B S R & Co. LLP, Chartered Accountants (ICAI Registration No. 101248W/W-100022) were appointed as the Statutory Auditors of the Company to hold office from the conclusion of the 33^rd Annual General Meeting till the conclusion of the ensuing 38^th Annual General Meeting.

After evaluating all proposals and considering various factors such as independence, industry experience, technical skills, geographical presence, audit team, audit quality reports, etc., BSR has been recommended for the reappointment as statutory auditors of the Company for a term of five years, from the conclusion of the ensuing Annual General Meeting, till the Annual General Meeting to be held in the calendar year 2027, at such remuneration mutually agreed and approved by the Board.

The Company has received confirmation from the Auditors to the effect that their appointment, if made, will be in accordance with the limits specified under the Companies Act, 2013 and that the firm satisfies the criteria specified in Section 141 of the Act read with Rule 4 of Companies (Audit & Auditors) Rules 2014.

b) Secretarial Audit

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed V. Sreedharan & Associates, Practicing Company Secretary to undertake the S ecretarial Audit of the Company. The Report of the Secretarial Audit is annexed herewith as Annexure-IV.

c) Cost Audit

The Company is not required to maintain cost records as per sub-section (1) of Section 148 of the Act.

36. General Disclosure

During the year, there were no transactions requiring disclosure or reporting in respect of matters relating to:

(a) i ssue of equity shares with differential rights as to dividend, voting or otherwise;

(b) i ssue of shares (including sweat equity shares) to employees of the Company under any scheme;

(d) significant or material order passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future;

(e) pendency of any proceeding under the Insolvency and Bankruptcy Code, 2016; and

(f) i nstance of one-time settlement with any bank or financial institution.

37. Auditor''s Report and Secretarial Auditor''s Report

The Auditors'' Report on the financial statements of the Company for the financial year ended 31^st March 2022 is unmodified, i.e., it does not contain any qualification, reservation, or adverse remark. The Auditor''s Report is enclosed with the financial statements forming part of the Annual Report.

There are no disqualifications, reservations, adverse remarks, or disclaimers in the secretarial auditor''s report.

38. Disclosures of Transactions of the Listed Entity with any Person or Entity belonging to the Promoter/Promoter Group which hold(s) 10% or more Shareholding in the Listed Entity, in the format prescribed in the relevant Accounting Standards for Annual Results Related Party Transactions with Promoter/Promoter Group holding 10% or more shares Tamilnadu Industrial Development Corporation Limited and Tata Sons Private Limited holds 10% or more shares in the Company. The details of transactions with promoter/promoter group holding 10% or more shares have been disclosed in the financial statements which is part of the Annual Report.

The details of the transactions with related parties during Financial Year 2021-22 are provided in the accompanying financial statements. There were no transactions during the year which would require to be reported in Form AOC-2.

Acknowledgements

Your Directors wish to place on record their appreciation for the commitment extended by the employees of the Company and its subsidiaries during the year, especially during the second and third wave of COVID-19 related disruptions. Further, the Directors also wish to place on record the support which the Company has received from its promoters, shareholders, bankers, business associates, vendors and customers of the Company.

On behalf of the Board of Directors,

S Krishnan C K Ve n kata ra man

Chairman Managing Director

In line with the internal guidelines, no payment is made towards commission to Mr. N N Tata, Non-Executive Director of the Company during the period for which he was in full-time employment with other Tata Group companies i.e., till November 2021.

Employed for part of the year and hence not applicable.

The remuneration includes the Commission for the year under reporting and payable in Financial Year 2022-23 post the ensuing Annual General Meeting.

Mar 31, 2021

To the Members of Titan Company Limited

The Directors are pleased to present the Thirty Seventh Annual Report and the Audited Financial Statements for the year ended

1. Financial Results ('' in crore)
	Standalone		Consolidated
	2020-21	2019-20	2020-21	2019-20
Revenue from Operations	20,602	20,010	21,644	21,052
Other Income	181	146	186	153
Total Income	20,783	20,156	21,830	21,205
Expenditure	18,901	17,592	19,920	18,585
Profit before exceptional items, finance costs, depreciation and taxes	1,882	2,564	1,910	2,620
Finance Costs	181	149	203	166
Depreciation/Amortisation	331	310	375	348
Profit before share of profit/(loss) of an associate and joint venture and exceptional items and taxes	1,370	2,105	1,332	2,106
Share of profit/(loss) of an associate and Jointly controlled entity	-	-	(5)	(4)
Profit before exceptional items and taxes	1,370	2,105	1,327	2,102
Exceptional items	137	-	-	-
Profit before taxes	1,233	2,105	1,327	2,102
Income taxes
- Current	351	552	360	570
- Deferred	5	36	(7)	39
Profit for the year	877	1,517	974	1,493
Attributable to
- Shareholders of the Company	877	1,517	973	1,501
- Non-controlling interests	-	-	1	(9)
Profit brought forward	3,757	2,876	3,592	2,759
Appropriations
Adjustment of transition to Ind AS 116 on opening retained earnings	-	(156)	-	(159)
Deferred tax on Ind AS 116 transition impact	-	55	-	55
Acquisition of non-controlling interest in subsidiary	-	-		(30)
Dividend on Equity Shares (excluding tax)	(355)	(444)	(355)	(444)
Tax on dividends	-	(91)	-	(91)
Closing Balance in Retained Earnings	4,279	3,757	4,210	3,592

1 a) Standalone Numbers:

During the year under review, the Company''s total revenue grew by 3% to '' 20,602 crore compared to '' 20,010 crore in the previous year.

Profit before tax declined by 41% to '' 1,233 crore and the net profit decreased by 42% to '' 877 crore.

The Watches and Wearables Division of the Company recorded revenue of '' 1,580 crore, a decline of 40%. The revenue from Jewellery Division grew by 3% touching '' 17,274 crore (excluding sale of bullion of '' 1,357 crore). The revenue from Eyewear Division declined by 31% to '' 375 crore.

New Businesses, viz. Indian Dress Wear Division and Fragrances and Accessories Division recorded revenue of '' 98 crore, a decline of 43% over the previous year. While the Indian Dress Wear Division declined by 30%, the Fragrances and Accessories Division recorded a decrease of 51%.

With the declaration of COVID-19 as a pandemic in mid-March 2020, the performance of various Divisions were affected during the first half of the last financial year due to store closures consequent upon declaration of national lockdown by the Government and subsequent state-wise lockdowns. Watches & Wearables and Eyewear revenue declined whereas Jewellery Division grew marginally by 3%, (excluding sale of bullion during the year). There was a substantial increase in the procurement of gold through Gold on Lease resulting in considerable increase in the cash balances and no borrowings at the end of the year.

The Management Discussion and Analysis report, which is attached, dwells into the performance of each of the business divisions and the outlook for the current year.

1 b) Consolidated Numbers

At the consolidated level, the revenue stood at '' 21,644 crore as against '' 21,052 crore in the previous year. The details of the performance of the Company''s subsidiaries are covered below in point 17 of this Report.

2. International Operations

The impact of the pandemic on this business was significant as secondary sales dried up leading to virtually zero primary sales to the Company''s distributors in the first half of the year. As some normalcy returned in the

second half of the year, efforts were focused on targeted expansion and maximizing returns from markets that performed better. New products, new distribution channels and a focus on e-commerce enabled a reasonable recovery in the second half of the year.

The first international Tanishq store in Meena Bazaar, Dubai was opened in October 2020 in the midst of the pandemic but did exceedingly well. The store is loved by discerning customers for its differentiated merchandise and superlative customer experience. Further efforts will also be made to expand the brands'' presence in the GCC region and around the world. Considering this, the Company plans to enter into North America for which ground work has been initiated.

3. COVID- 19

The COVID-19 pandemic has emerged as a global challenge, creating disruption across the world. The businesses and business models have transformed to create a new work order.

The revenue impact of the pandemic played out broadly along the anticipated lines with varying levels of impact and a positive surprise in the Jewellery business.

The physical and emotional well-being of employees continues to be a top priority for the Company, with several initiatives taken to support employees and their families during the pandemic. The Company has extended counselling and self-help services providing mental & emotional support to employees. The Company has reimagined employee engagement by embracing virtual technologies. Initiatives were taken to reduce stress and the feeling of isolation, hosted inspirational leaders, mental health experts and finance experts to boost the morale of employees.

After registering tepid business during the first half of the year due to COVID-19, the Company witnessed strong business momentum as the COVID-19 impact on the consumer sentiments seemed to fade during the second half of the year. After recording the best revenue in the third quarter, which was a festive season, the Company again recorded very strong revenues in the last quarter across all businesses. The strong performance in the financial year had been the result of the agility in navigating through the crisis and uncertainty of ground situations, along with innumerous grass root innovations to serve consumer needs and leveraging digital channels to reach-out to them effectively. While the Jewellery Division has emerged very strongly from the crisis and witnessed strong growth in the last two quarters, the

Watches & Wearables and the Eyewear Divisions have also made very good progress on recovery. The Company continued with its retail network expansion during the year across the Watches & Wearables, Jewellery and Eyewear businesses.

I n line with the Company''s philosophy to support its ecosystem, during the year, the Company had granted loans to the extent of '' 97 crore to its franchisees and vendors to support them during the pandemic crisis, out of which an amount of '' 3 crore is outstanding as of 31^st March 2021.

4. Dividend

The Directors are pleased to recommend the payment of dividend on equity shares at the rate of 400% (i.e. '' 4 per equity share of '' 1 each), subject to approval by the shareholders at the ensuing Annual General Meeting (AGM) and payment is subject to deduction of tax at source as may be applicable.

5. Transfer to General Reserve

As permitted under the provisions of the Companies Act, 2013, the Board do not propose to transfer any amount to general reserve and has decided to retain the entire amount of profit for Financial Year 2020-21 in the profit and loss account.

6. Finance

The year saw all the businesses being impacted by the COVID-19 pandemic with slow-down in operations and sales. The Company''s War on Waste initiative to control the costs, gave very good results in reducing costs significantly. Further, the Company''s particular focus on conserving cash ensured that adequate liquidity was available despite the pandemic. Substantial increase in the procurement of gold through Gold on Lease resulted in huge cash generation for the year resulting in a very comfortable cash position at the end of the year. During the year under review, ICRA upgraded the Company''s long term rating from AA to AAA with stable outlook. The Company had issued Commercial Papers (CP) totalling '' 1,500 crore with three month tenure during the first and second quarters of the year and redeemed the same on the respective due dates. There were no outstanding CPs as of 31^st March 2021. During the year, the Company had sold its excessive bullion thereby increasing the efficiency in inventory management and cash flow situation.

7. Public Deposits

The Jewellery Division of the Company was successfully operating customer acquisition schemes for jewellery purchases for many years. When the Companies Act, 2013 (the "Act") became substantially effective from 1^st April 2014, the Company had around seven lakh subscribers contributing to these schemes. However, these schemes were exempt under the Companies Act, 1956 relating to acceptance of public deposits as such schemes were not covered in the definition of deposits. Under the Act and the Rules made there under (''Deposit Regulations'') the scope of the term "deposit" was enlarged and therefore a view was taken that the jewellery purchase schemes offered by the Company to its customers would be treated as public deposits. Thereupon, the Company discontinued fresh enrolment of subscribers and initiated steps to close the erstwhile customer schemes, which were wound down in August 2014.

The details relating to deposits, covered under Chapter V of the Act are as under:

(a) accepted during the year: '' 1,909 crore

(b) remained unpaid or unclaimed as at the end of the year: '' 1,075 crore

(c) whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved-

(i) at the beginning of the year : Nil

(ii) maximum during the year : Nil

(iii) at the end of the year : Nil

There are no deposits that have been accepted by the Company that are not in compliance with the requirements of Chapter V of the Act.

8. Material Changes and Commitments Affecting Financial Position Between end of the Financial Year and Date of Report

There have been no material changes and commitments for the likely impact affecting financial position between end of the financial year and the date of the report except for the impact arising out of the continuance of the COVID-19 pandemic which has risen exponentially in the second wave till the date of signing of this Report.

Please refer Note 37 of Notes to the standalone financial statements for further details in respect of impact of COVID-19 on the financial statements of the Company

9. Significant and Material Orders

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations in future.

10. Particulars of Loans, Guarantees and Investments

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Act are given in the notes to the financial statements.

During the year under review, the Company had invested '' 28 crore (CHF 3.61 million) as application money towards equity stake in Favre Leuba AG (FLAG).

The Company had provided Corporate Guarantee of '' 66 crore to Titan Holdings International FZCO in two tranches and a Corporate Guarantee of '' 7 crore to Titan Global Retail LLC during the year.

11. Integrated Report

The Company has, over the last three years, taken steps to move towards Integrated Reporting in line with its commitment to voluntarily disclose more information to the stakeholders on all aspects of the Company''s business. Accordingly, the Company had introduced key content elements of Integrated Reporting aligned to the International Integrated Reporting Council Framework (IIRC) in the Annual Report of the previous year and has disclosed more qualitative data in the Annual Report of this year. Similar to earlier years, the relevant information has been provided in this year''s Annual Report as well.

12. Adequacy of Internal Controls and Compliance with Laws

The Company, during the year has reviewed its Internal Financial Control systems and has continually contributed to establishment of more robust and effective internal financial control framework, prescribed under the ambit of Section 134(5) of the Act. The preparation and presentation of the financial statements is pursuant to the control criteria defined considering the essential components of Internal Control - as stated in the "Guidance Note on Audit of Internal Financial Controls Over Financial Reporting" issued by the Institute of Chartered Accountants of India.

The control criteria ensures the orderly and efficient conduct of the Company''s business, including adherence to its policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

Based on the assessment carried out by the Management and the evaluation of the results of the assessment, the Board of Directors are of the opinion that the Company has adequate Internal Financial Controls system that is operating effectively as at 31^st March 2021.

There were no instances of fraud which necessitates reporting of material misstatement to the Company''s operations.

There has been no communication from regulatory agencies concerning non-compliance with or deficiencies in financial reporting practices.

13. Board Meetings

During the year under review, seven Board meetings were held, details of which are provided in the Corporate Governance Report.

14. Audit Committee and other Board Committees

The details pertaining to the composition of the Audit Committee and its role is included in the Corporate Governance Report, which is a part of this Annual Report. In addition to the Committees mentioned in the Corporate Governance Report, the Company has a Corporate Social Responsibility Committee, the details of which are covered in Annexure II to this Report.

15. Risk Management

Pursuant to the requirement of Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements)

Regulations, 2015 (the "SEBI LODR"), the Company has constituted a Risk Management Committee (RMC), consisting of Board members and senior executives of the Company.

The Company has in place a Risk Management framework to identify, evaluate business risks and challenges across the Company both at corporate level as also separately for each business division.

The top tier of risks for the Company is captured by the operating management after extensive deliberations on the nature of the risk being a gross or a net risk and thereafter in a prioritized manner presented to the Board for their inputs on risk mitigation/management efforts. Based on this framework, a Risk Management policy has been adopted.

The RMC engages in the Risk Management process and has set out a review process so as to report to the Board the progress on the initiatives for the major risks of each of the businesses that the Company is into.

The Company has a robust process for managing the top risks, overseen by the Risk Management Committee (RMC) of the Board. As part of this process, the Company has identified the risks with the highest impact and then assigned them a likely probability of occurrence. Mitigation plans for each risk have also been put in place and are reviewed by the Management every six months before presenting to the RMC.

16. Related Party Transactions

There are no materially significant Related Party Transactions made by the Company with Promoters, Directors, Key Managerial Personnel which may have a potential conflict with the interests of the Company at large. All Related Party Transactions are placed before the Audit Committee and the Board for approval, if required. Prior omnibus approval of the Audit Committee is obtained for the transactions which are of a foreseen and repetitive in nature. The transactions entered into pursuant to the omnibus approval so granted are verified by the Internal Auditor and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval, if applicable, on a quarterly basis. The Company has developed an Internal Guide on Related Party Transactions Manual and prescribed Standard Operating Procedures for the purpose of identification and monitoring of such transactions. The Policy on Related Party Transactions as approved by the Board is uploaded on the Company''s website. None of the Directors have any pecuniary relationships

or transactions except to the extent of sitting fees and commission paid to the Directors and to Mr. Bhaskar Bhat to whom the Company pays monthly pension as approved by the Board of Directors consequent upon his retirement as Managing Director of the Company in the month of September 2019.

The details of the transactions with related parties during the year 2020-21 are provided in the accompanying financial statements. There were no transactions during the year which would require to be reported in Form AOC-2.

17. Subsidiaries/Joint Venture/Associate Company

As on 31^st March 2021, the Company had the following

Sl. No.	Name of the Subsidiary/ Associate/ Joint Venture	Relationship
1	Favre Leuba AG, Switzerland	Subsidiary
2	Titan Watch Company Limited, Hong Kong	Step-down Subsidiary
3	Titan Engineering & Automation Limited	Subsidiary
4	CaratLane Trading Private Limited	Subsidiary
5	Green Infra Wind Power Theni Limited	Associate
6	Titan Holdings International FZCO, Dubai	Subsidiary
7	Titan Global Retail LLC, Dubai	Step-down Subsidiary
8	Titan Commodity Trading Limited	Subsidiary
9	StudioC Inc. USA	Step-down

The Company held a 49% equity stake in Montblanc India Retail Private Limited (Montblanc India), a joint venture entered into with Montblanc Services B.V., the Netherlands for operation of retail boutiques in India for Montblanc products. As part of the Company''s consolidation strategy to focus on its primary business and proprietary brands, the Company, during the year, took a strategic decision to divest its entire shareholding in Montblanc India to its Joint Venture partner and accordingly the divestment was completed on 12^th March 2021 at a consideration of '' 43 crore by exercising Put Option under the joint venture agreement. Consequently, the Company has recognised profit on sale of investment amounting to '' 4 crore under the head "Other income" during the year ended 31^st March 2021.

During the year 2020-21, Favre Leuba AG (FLAG), a wholly owned subsidiary in Switzerland, had registered

a turnover of CHF 1.04 million i.e,, '' 8 crore against the previous year''s figures of CHF 0.89 million, i.e. '' 6 crore and loss of CHF 7.34 million, i.e. '' 58 crore (2019-20: CHF 7.19 million, i.e. '' 51 crore). During the year Financial Year 2020- 21, the Company had invested CHF 3.61 million ('' 28 crore) in FLAG as share application money. During the year, the Company had decided to significantly scale down the operations of FLAG due to the adverse impact on its operations post the COVID-19 pandemic. Consequent to this, the Company performed an impairment testing of its investments in FLAG and made an additional provision of '' 137 crore towards impairment of investment in FLAG.

Titan Watch Company Limited is a subsidiary of Favre Leuba AG and hence is a step- down subsidiary of the Company. It has a capital of HK $ 10,000 and no Profit and Loss account has been prepared.

During the year, Titan Engineering & Automation Limited (TEAL) generated income of '' 354 crore against the previous year''s figures of '' 462 crore, a decrease of 24% and the profit before tax was at '' 40 crore against the previous year''s figures of '' 78 crore. The performance of TEAL was substantially hit due to the challenges faced by the Aerospace & Defence and Automation Divisions on account of COVID-19 pandemic. The TEAL Board has recommended a dividend of '' 5 per share on the face value of '' 10 per share aggregating to '' 24 crore (subject to applicable taxes) for Financial Year 2020-21.

CaratLane Trading Private Limited (CaratLane) is engaged in the business of manufacturing of jewellery products and has significant online and offline presence. During the last financial year, CaratLane recorded double digit growth in retail sales, with great emphasis on omniselling. CaratLane added 25 stores in the year to take the store count to 117. During the year 2020-21, CaratLane registered a turnover of '' 716 crore (previous year: '' 621 crore) and recorded a profit of '' 2 crore for the first time as against the previous year''s loss of '' 27 crore.

Titan Holdings International FZCO (Titan Holdings) which was formed on 22^nd October 2019 as a Free Zone Company with a view to carry out business activities and invest in the share capital of any other companies/entities either as a joint venture partner or as its wholly owned subsidiary company for carrying out business activities. Titan Holdings incurred a loss of AED 0.60 million ('' 1 crore) against previous year''s loss of AED 0.31 million ('' 0.59 crore).

During the year, Titan Global Retail LLC started its operations through the store opened in Dubai in October 2020 and registered a turnover of AED 19.20 million

('' 39 crore) and incurred a loss of AED 2.47 million ('' 5 crore) against previous year''s loss of AED 0.41 million ('' 0.79 crore).

Titan Commodity Trading Limited (TCTL) was incorporated as a Wholly-Owned Subsidiary during the year with the objective of carrying on the business of trading in various commodities and products by acquiring or registering as a member of various commodity exchange/s and to acquire and build technology to facilitate trading, dealing, buying and selling of all types of direct commodities or commodity futures and other precious materials. Subsequently, TCTL is registered as a Trading Member on the Multi Commodity Exchange of India Limited. As of 31^st March 2021, the Company had not started operations.

During the year, StudioC Inc. USA was incorporated as a 100% subsidiary of CaratLane, with the objective of retailng of jewellery in North America. However, the Company has not started any operations as of 31^st March 2021.

The Company holds 26.79% stake in Green Infra Wind Power Theni Limited which supplies energy to the Company.

None of these subsidiary companies declared a dividend for Financial Year 2020-21 except TEAL.

The annual accounts of these subsidiary companies/JV company were consolidated with the accounts of the Company for Financial Year 2020-21.

18. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

The particulars as prescribed under sub-section (3) (m) of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 are furnished in Annexure-I to the Board''s Report.

19. Corporate Social Responsibility (CSR)

In compliance with Section 135 of the Act, the Company has undertaken CSR activities, projects and programs as provided in the CSR policy of the Company and as identified under Schedule VII of the Act and excluding activities undertaken in pursuance of its normal course of business. In addition to the projects specified as CSR activities under Section 135 of Act, the Company has also carried out several other sustainability/responsible business initiatives and projects. The Company has spent the entire 2% of the net profits earmarked for CSR projects during the Financial Year 2020-21. A report on CSR pursuant to Section 135 of the Act and Rules made thereunder is attached in Annexure-II.

in line with the amendments to the CSR Rules notified in January 2021, the Company has amended its CSR policy and the same has been uploaded on the website of the Company along with the Action Plan for the CSR activities for Financial Year 2021-22.

20. Annual Return

The link to access the Annual Return is https://www. titancompany.in/sites/default/files/Annual%20 Return%20for%202021.pdf

21. Dividend Distribution Policy

The Dividend Distribution Policy, as amended by the Board at its meeting held on 29^th April 2021 is annexed as Annexure-III to this Report.

22. Vigil Mechanism

The Company has a whistle blower mechanism wherein the employees can approach the Management of the Company (Audit Committee in case where the concern involves the Senior Management) and make protective disclosures to the Management about unethical behaviour, actual or suspected fraud or violation of the Company''s Code of Conduct and insider Trading Code. The Whistle Blower Policy requires every employee to promptly report to the Management any actual or possible violation of the Code or an event an employee becomes aware of that could affect the business or reputation of the Company. The disclosures reported are addressed in the manner and within the time frames prescribed in the policy. A mechanism is in place whereby any employee of the Company has access to the Chairman of the Audit Committee to report any concern. No person has been denied access to the Chairman to report any concern. Further, the said policy has been disseminated within the organisation and has also been posted on the Company''s website at https://www.titancompany.in/sites/default/ files/Whistle%20Blower%20Policy_1.pdf.

23. Secretarial Standards

The Directors state that the applicable Secretarial Standards i.e., SS-1 and SS-2, issued by the institute of Company Secretaries of india, relating to Meetings of Board of Directors and General Meetings respectively, have been duly complied with.

24. Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company continues to work towards ensuring a safe and secure workplace to all its employees. The

Company has matured in its practices and the awareness amongst employees in realizing their rights and responsibilities. Regular internal feedback mechanisms have shown encouraging signs of trust and confidence in the organization by various stakeholders (employees, partners and vendors).

The pandemic situation was an opportunity for the internal Complaints Committee (ICC) members to adapt to the virtual reality quickly and increase the outreach. All stakeholders across geographies, viz. employees, contract and agency hires, vendors and associates are part of the virtual communication cascades. The regional heads or manufacturing/unit heads along with the leadership team also led the conversations with their respective teams on this subject. This has impacted positively with more and more stakeholders becoming familiar with the policy and gaining confidence to raise concerns with the locational committee members. About 81 such cascades covering over 3,000 stakeholders were held virtually. Other means of communication using short films, quizzes and games were continued to be shared on digital platforms.

During the financial year Financial Year 2020-21, the Company received 4 complaints on sexual harassment, 3 were disposed off with appropriate action taken and 1 complaint was pending as on 31^st March 2021 which was disposed off as on the date of this report.

25. Details in Respect of Frauds Reported by Auditors Under Sub-Section (12) of Section 143 other than those which are Reportable to the Central Government

26. Corporate Governance and Management Discussion and Analysis

Pursuant to Regulation 34 of the SEBI LODR, the Management Discussion and Analysis is presented in a separate section forming part of this Annual Report. As required under the provisions of the SEBi LODR, the Audit Committee of the Company has reviewed the Management Discussion and Analysis report of the Company for the year ended 31^st March 2021.

27. Business Responsibility Report

As per SEBI LODR, a Business Responsibility Report is attached and forms part of this Annual Report.

28. Directors and Key Managerial Personnel

Ms. Hema Ravichandar and Ms. Ireena Vittal were Independent Directors during part of the Financial Year 2020-21. Ms. Hema Ravichandar, Independent Director, retired from the Board with effect from 1^st August 2020 upon completion of her second term as an Independent Director. Ms. Ireena Vittal resigned from the Board with effect from 1^st October 2020 due to her increased preoccupation with her other professional commitments. The Board placed on record its appreciation for the valuable contribution and wise counsel rendered by Ms. Hema Ravichandar and Ms. Ireena Vittal during their tenure as a member of the Board.

Mr. Ashwani Puri, Mr. B Santhanam, Mr. Pradyumna Vyas and Dr. Mohanasankar Sivaprakasam were the Independent Directors during the entire financial year 2020-21. Ms. Sindhu Gangadharan and Mr. Sandeep Singhal were appointed as Independent Directors during the year. Ms. Sindhu Gangadharan was appointed as an Additional Director and Independent Director on the Board of the Company with effect from 8^th June 2020 and subsequently approved by the shareholders at the thirty sixth Annual General Meeting held on 11^th August 2020 as an Independent Director for a period of five years from 8^th June 2020. Mr. Sandeep Singhal, on the basis of the recommendation of the Board Nomination and Remuneration Committee, was appointed as an Additional Director and Independent Director on the Board of the Company on 11^th November 2020 for a period of five years subject to the approval of the shareholders in the ensuing Annual General Meeting.

All the Independent Directors have given declarations that they continue to meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI LODR and that they are not debarred from holding the office of director by virtue of any SEBI order or any other such authority. All the Independent Directors have confirmed that they are in compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to registration with the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

The Board had, based on the recommendations of the Board Nomination and Remuneration Committee and pursuant to the performance evaluation of Mr. Ashwani Puri as a Member of the Board and considering that

the continued association of Mr. Ashwani Puri would be beneficial to the Company, proposed to re-appoint Mr. Ashwani Puri as an Independent Director of the Company, not liable to retire by rotation, for a second term effective 3^rd August 2021 up to 5^th May 2026.

In accordance with the provisions of the Act and in terms of the Memorandum and Articles of Association of the Company, Mr. V. Arun Roy retires by rotation at the ensuing Annual General Meeting and has offered himself for re-appointment.

Subsequent to the end of financial year under review, Tamilnadu Industrial Development Corporation Limited (TIDCO) had withdrawn the nomination of Ms. Kakarla Usha, I AS as its nominee director and nominated Mr. Pankaj Kumar Bansal, IAS in her place. Accordingly, on 16^th June 2021, the Board has appointed Mr. Pankaj Kumar Bansal, IAS as an Additional Director, who will hold office as Director up to this AGM and a resolution is placed in the ensuing AGM for his appointment as a director of the Company.

The Board placed on record its appreciation for the valuable contribution and wise counsel rendered by Ms. Usha Kakarla during her tenure as a member of the Board.

Members attention is drawn to Item No. 4 of the Notice for the re-appointment of Mr. V. Arun Roy as a Director of the Company, liable to retire by rotation, Item No.5 of the Notice for the reappointment of Mr. Ashwani Puri as an Independent Director of the Company for the second term, Item No.6 of the Notice for the appointment of Mr. Sandeep Singhal as an Independent Director of the Company for a period of five years from 11^th November 2020 and Item No. 7 for appointment of Mr. Pankaj Kumar Bansal, IAS as a Director, liable to retire by rotation.

None of the Directors are related to each other within the meaning of the term "Relative" as per Section 2(77) of the Act.

29. Details of Key Managerial Personnel who were Appointed or have Resigned during the year

None of the Key Managerial Personnel were appointed or resigned during the year. Pursuant to the provisions of Section 203 of the Act, Mr. C K Venkataraman-Managing Director, Mr. S. Subramaniam - Chief Financial Officer and Mr. Dinesh Shetty - General Counsel & Company Secretary continue to be the Key Managerial Personnel of the Company.

30. Directors'' Responsibility Statement

Based on the framework of Internal Financial Controls and compliance systems established and maintained

by the Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company''s internal financial controls are adequate and operating effectively.

Accordingly, pursuant to the requirements of Section 134 (5) of the Act, the Directors hereby confirm that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

iv. they have prepared the annual accounts on a going concern basis;

v. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

31. Board Evaluation

The performance evaluation of the Board, its Committees and individual Directors was conducted by the Board Nomination and Remuneration Committee (BNRC) and the Board. This was based on questionnaire responses and feedback with each Director. Based on the questionnaire, the performance of every Director was evaluated by the BNRC and presentation was made to the Board and an action plan was drawn accordingly.

Some of the key criteria for performance evaluation, as

Performance evaluation of directors:

Contribution at Board/Committee meetings and Guidance/ support to Management outside Board/ Committee Meetings.

Performance evaluation of Board and Committees:

Board structure and composition, Degree of fulfilment of key responsibilities, Establishment and delineation of responsibilities to Committees, Effectiveness of Board Processes, Information and Functioning, Board Culture and Dynamics, Quality of relationship between the Board and Management, Efficacy of communication with External Stakeholders and Committees - strengths and areas of improvement.

32. Independent Directors

A separate meeting of the Independent Directors ("Annual ID Meeting") was convened, which reviewed the performance of the Board (as a whole), the non-independent directors and the Chairman. Post the Annual ID Meeting, the collective feedback of each of the Independent Directors was discussed by the Chairperson of the BNRC with the Board covering performance of the Board as a whole, performance of the non-independent directors and performance of the Chairman of the Board.

33. Remuneration Policy

The Board has, on the recommendation of the BNRC, framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The link to access the Remuneration Policy is https://www.titancompany.in/sites/default/files/ REMUNERATION%20POLICY%20FOR%20 DIRECTORS.pdf

34. Policy on Directors'' Appointment and Remuneration and other Details

In accordance with the Joint Venture Agreement between the promoters, three Directors each may be nominated by Tata Sons Private Limited and Tamilnadu Industrial Development Corporation Limited.

The guidelines for selection of Independent Directors are as set out below:

The BNRC oversees the Company''s nomination process for Independent Directors and in that connection to identify, screen and review individuals qualified to serve as an Independent Director on the Board. The BNRC further has in place a process for selection and the attributes that would be desirable in a candidate and as

35. Other Disclosures

The information required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below;

i) The ratio of the remuneration of each director to the median remuneration of the employees of the Company and the percentage increase in remuneration of each Director, Managing Director, Chief Financial Officer and Company Secretary in the financial year;

Note : Aligning with the performance of the Company for Financial Year 2020-21, the Board approved payment of Commission to the non-executive Directors at 60% of the commission as eligible as per the criteria adopted by the Board.

1 The % change in remuneration is not comparable as the said directors held the position for a part of the year either in 2019-20 or in 2020-21.

2 I n line with the internal guidelines, no payment is made towards commission to Mr. N N Tata, Non-Executive Director of the Company, as he is in full-time employment with another Tata Group Company

3 Ms. Hema Ravichandar ceased to hold office as an Independent Director of the Company with effect from 1^st August 2020 upon completion of her second term as approved by the shareholders at the 35^th Annual General Meeting of the Company.

4 Ms. Ireena Vittal resigned from the Company with effect from 1^st October 2020.

5 Ms. Sindhu Gangadharan was appointed as an Independent Director on the Board effective 8^th June 2020.

6 Mr. Sandeep Singhal was appointed as an Additional Independent Director on the Board effective 11^th November 2020.

ii) The percentage increase in the median remuneration of employees in the financial year; No increment was provided for the Financial Year 2020-21 as the sales and profits in Financial Year 2020-21 were projected to be significantly lower than the Financial Year 2019-20 levels due to the COVID-19 pandemic.

iii) The number of permanent employees on the rolls of company; 7,235

remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration;

No increase was given during the previous year thereby there is no comparison with the managerial remuneration.

v) Affirmation that the remuneration is as per the Remuneration Policy of the Company;

and motivate a high performance and engaged workforce. The Company follows a compensation mix of fixed pay, benefits and performance based variable pay. Individual performance pay is determined by business performance and the performance of the individuals measured through the annual appraisal process. The Company affirms that remuneration is as per the Remuneration Policy of the Company.

36. Information as per Rule 5(2) of the Chapter XIII, of the Companies (Appointment and Remuneration of Managerial Personnel)

Rules, 2014

37. Auditors

a) Statutory Auditors

Pursuant to the provisions of Section 139 of the Act read with applicable Rules framed thereunder, M/s. BSR & Co., LLP have been appointed as Auditors for a term of five years, subject to ratification by the shareholders, from the conclusion of the 33^rdAnnual General Meeting till the conclusion of the 38^th Annual General Meeting.

The Ministry of Corporate Affairs vide Notification dated 7^th May 2018 notified several Sections of the Companies (Amendment) Act, 2017. In view of the said notification, the requirement of ratification of appointment of auditors, under Section 139 of the Companies Act, 2013, at each AGM is no longer required. Hence, the resolution to this item is not being included in the Notice to the AGM.

b) Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed V Sreedharan & Associates, Practicing Company Secretary to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is annexed herewith as Annexure-IV.

c) Cost Audit

The Company is not required to maintain cost records as per sub-section (1) of Section 148 of the Act.

38. Auditor''s Report and Secretarial Auditor''s Report

There are no disqualifications, reservations, adverse remarks or disclaimers in the auditor''s report and secretarial auditor''s report.

39. Disclosures of Transactions of the Listed Entity with any Person or Entity belonging to the Promoter/Promoter Group which hold(s) 10% or more Shareholding in the Listed Entity, in the format prescribed in the relevant Accounting Standards for Annual Results

Related Party Transactions with Promoter/ Promoter Group holding 10% or more shares

Acknowledgements

Your Directors wish to place on record their appreciation of the support which the Company has received from its promoters, shareholders, lenders, business associates, vendors, customers, media and the employees of the Company.

On behalf of the Board of Directors,

N Muruganandam C K Venkataraman

Chairman Managing Director

Chennai Bengaluru

Mar 31, 2019

To the Members of Titan Company Limited

The Directors are pleased to present the Thirty Fifth Annual Report and the Audited Financial Statements for the year ended 31st March 2019:

1. FINANCIAL RESULTS

(Rs. in Crore)

	Standalone		Consolidated
	2018-2019	2017-2018	2018-2019	2017-2018
Revenue from Operations	19,070	15,656	19,779	16,156
Other Income	178	86	183	89
Total Income	19,248	15,742	19,961	16,245
Expenditure	17,068	13,922	17,787	14,511
Profit before exceptional items,	2,181	1,820	2,174	1,734
finance costs, depreciation and taxes
Finance Costs	44	48	53	53
Depreciation / Amortisation	139	110	163	131
Profit before share of profit/(loss) of	1,997	1,662	1,959	1,549
an associate and joint venture and
exceptional items and taxes
Share of profit/(loss) of an associate and	-	-	(2)	(3)
Jointly controlled entity
Profit before exceptional items and taxes	1,997	1,662	1,957	1,546
Exceptional items	70	92	-	17
Profit before taxes	1,927	1,571	1,957	1,530
Income taxes
- Current	602	446	618	450
- Deferred	(49)	(39)	(49)	(22)
Profit for the year	1,374	1,163	1,389	1,102
Attributable to
- Shareholders of the Company	1,374	1,163	1,404	1,130
- Non-controlling interests	-	-	(16)	(28)
Profit brought forward	1,903	1,268	1,792	1,190
Appropriations
Deletion on account of sale of subsidiary	-	-	4.20	-
Acquisition of non-controlling interest	-	-	31.57	-
in subsidiary
Dividend on Equity Shares (excluding tax)	(333)	(231)	(333)	(231)
Tax on dividends	(68)	(47)	(68)	(47)
Transfer to general reserve	-	(250)	-	(250)
Closing Balance in Retained Earnings	2,876	1,903	2,759	1,792

1a) STANDALONE NUMBERS:

During the year under review, the Companyâs total revenue grew by 21.81% to RS. 19,070 compared with RS. 15,656 crore in the previous year.

The Company had invested RS. 145 crore in the Inter Corporate Deposits issued by Infrastructure Leasing & Financial Services Limited (IL&FS Group). Owing to the defaults made by the IL&FS Group effective October 2018, the Company has, based on assessment made pertaining to recovery of these investments in the Group, has made provision for the entire investment of RS. 145 crore in FY 2018-19.

During the year, the Company took an additional impairment of RS. 70 crore pertaining to investment in Favre Leuba AG, a wholly owned subsidiary, after considering the past performance of the brand.

Profit before tax grew by 22.7 % to RS. 1,927 crore and the net profit increased by 18.2 % to RS. 1,374 crore despite provisions made for IL&FS and Favre Leuba AG.

The year witnessed aggressive expansion of the Companyâs retail network. As on 31st March 2019, the Company had 1,595 stores, with over 2.05 million square feet of retail space delivering a retail turnover of over RS. 19,000 crore.

The Watches division of the Company recorded revenue of RS. 2,441 crore, a growth of 14.8% which was achieved through meticulous planning and execution of key initiatives. The revenue from Jewellery division grew by 23% touching RS. 16,030 crore. The revenue from Eyewear division grew by 2 3.2 % to RS. 511 crore.

The revenue from other divisions recorded a sale of RS. 133 crore, a growth of 40.4%.

New Businesses, viz Taneira and SKINN recorded revenue of RS. 80.59 crore, a growth of 40.5% over the previous year. While Taneira grew by 51 %, SkINN recorded a growth of 40%.

1b) CONSOLIDATED NUMBERS

At the consolidated level, the revenue stood at Rs. 19,779 crore as against RS. 16,156 crore in FY 2017-18. This was primarily due to robust performance of Titan Engineering & Automation Limited (TEAL), a wholly owned subsidiary and Carat Lane Trading Private Limited, a subsidiary company. The details of the performance of the Companyâs subsidiaries are covered in point 15 below of this Report.

The Management Discussion and Analysis report, which is attached, dwells into the performance of each of the business division and the outlook for the current year

2. INTERNATIONAL OPERATIONS

Business Environment in the international markets remained unfavourable in Q4 and declining trends were witnessed in the category across countries. For Titan, high-contributing Middle East markets continued to decline while younger markets like the Philippines, Thailand and the US stayed on the plan to deliver impressive retail growths on the back of several sales & marketing initiatives. The business delivered the budgeted bottom-line for FY18-19, but steep declines in Middle East markets left the overall business with a 10% decline for the year. FY19-20 plans will continue the journey of reducing dependence on Middle East markets and continue with investments in newer consumer bases (locals, across Middle East), markets (US, EU) and channels (e-commerce).

3. DIVIDEND

The Directors are pleased to recommend the payment of dividend on equity shares at the rate of 500% (i.e. RS. 5 per equity share of RS. 1 each), subject to approval by the shareholders at the ensuing Annual General Meeting (AGM).

4. TRANSFER TO GENERAL RESERVE

The Board of Directors has decided to retain the entire amount of profits for FY 2018-19 in the Retained Earnings.

5. FINANCE

Excellent top line growth and good working capital management helped the Company generate significantly higher levels of cash in the financial year. This resulted in substantially higher interest and other income from the surplus cash generated. However, as part of the treasury operations which were in line with the Investment Policy approved by the Board, the Company during the year had also invested RS. 145 crore in the 6 month inter corporate deposits with the IL&FS Group based on the high credit ratings assigned to them and assessment of risk profile at the time of investing. Unfortunately, the financial distress of the IL&FS Group was made evident after credit rating agencies downgraded the ratings to default status from the AAA they had assigned earlier when the Company had invested. The Company has therefore, as a measure of prudence, fully provided for this investment. The Company has also revisited its Investment Policy and created an Investment Committee of the Board to monitor investments going forward.

The Reserve Bank of India issued a circular in 2018 stopping companies from hedging their gold exposures in commodity exchanges outside the country effective July 2018. The Company had to therefore revert to hedging its gold exposure, which has also gone up significantly with the Companyâs gold exchange programs doing very well, in the local commodity exchanges. Given the current status of development of the market, the Company is not able to hedge gold for longer periods as required, making the process inefficient. The Company is working with authorities to remedy this situation as early as possible

6. PUBLIC DEPOSITS

The Jewellery Division of the Company was successfully operating customer schemes for jewellery purchases for many years. When the Companies Act, 2013 (the âActâ) became substantially effective from 1st April 2014, the Company had around seven lakh subscribers contributing to these schemes. However, these schemes were exempt under the Companies Act, 1956 relating to acceptance of public deposits as such schemes were not covered in the definition of deposits. Under the Act and Rules made there under (âDeposit Regulationsâ) the scope of the term âdepositâ was enlarged and therefore a view was taken that the jewellery purchase schemes offered by the Company to its customers would be treated as public deposits. Thereupon, the Company discontinued fresh enrolment of subscribers and initiated steps to close the erstwhile customer schemes, which were wound down by 31st August 2014.

Under the Deposit Regulations as amended from time to time, a company is permitted to accept deposits subject to applicable provisions, to the extent of 10% of the aggregate of the paid-up share capital, securities premium account and free reserves from its Members & 25% of the aggregate of the paid-up share capital, securities premium account and free reserves from the Public after prior approval by way of special resolutions passed by the Members in this regard. Requisite approval was obtained from the Members of the Company and a new customer scheme for jewellery purchase was launched in November 2014 in compliance with the Deposit Regulations.

The details relating to deposits, covered under Chapter V of the Companies Act, 2013 are as under:

(a) accepted during the year: RS. 2,175.37 crore

(b) remained unpaid or unclaimed as at the end of the year: RS. 1,273.32 crore

(c) whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved-

(i) at the beginning of the year: Nil

(ii) maximum during the year: Nil

(iii) at the end of the year: Nil

There are no deposits that have been accepted by the Company that are not in compliance with the requirements of Chapter V of the Act.

7. MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN END OF THE FINANCIAL YEAR AND DATE OF REPORT

There have been no material changes and commitments affecting financial position between end of the financial year and the date of the report.

8. SIGNIFICANT AND MATERIAL ORDERS

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Companyâs operations in future.

9. PARTICULARS OF LOANS, GUARANTEES AND investments

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Act are given in the notes to the financial statements.

During the year under review, the Company had invested RS. 99.99 crore in purchase of additional equity stake in Carat Lane Trading Private Limited (Carat Lane). In addition, the Company has, during the year, provided corporate guarantees amounting to RS. 40 crore to banks on behalf of Carat Lane.

The Company has not given any loans during the year under review.

10. INTEGRATED REPORT

Last year, the Company has taken its first step to move towards Integrated Reporting in line with its commitment to voluntarily disclose more information to the stakeholders on all aspects of the Companyâs business. Accordingly, the Company had introduced key content elements of Integrated Reporting aligned to the International Integrated Reporting Council Framework (IIRC) in the Annual Report of the previous year and has disclosed more qualitative data in the Annual Report of this year. Similar to last year, the relevant information has been provided in this yearâs Annual Report as well.

11. ADEQUACY OF INTERNAL CONTROLS AND COMPLIANCE WITH LAWS

The Company, during the year has reviewed its Internal Financial Control (IFC) systems and has continually contributed to establishment of more robust and effective IFC framework, prescribed under the ambit of Section 134(5) of Companies Act, 2013. The preparation and presentation of the financial statements is pursuant to the control criteria defined considering the essential components of Internal Control - as stated in the âGuidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI)â.

The control criteria ensures the orderly and efficient conduct of the Companyâs business, including adherence to its policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

There were no instances of fraud which necessitates reporting of material misstatement to the Companyâs operations.

There has been no communication from regulatory agencies concerning non-compliance with or deficiencies in financial reporting practices.

12. AUDIT COMMITTEE

The details pertaining to the composition of the audit committee and its role is included in the Corporate Governance Report, which is a part of this report.

13. RISK MANAGEMENT

Pursuant to the requirement of Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the âLODR Regulationsâ), the Company has constituted a Risk Management Committee (RMC), consisting of Board members and senior executives of the Company

The Company has in place a Risk Management framework to identify, evaluate business risks and challenges across the Company both at corporate level as also separately for each business division.

The top tier of risks for the Company is captured by the operating management after extensive deliberations on the nature of the risk being a gross or a net risk and thereafter in a prioritized manner presented to the Board for their inputs on risk mitigation/ management efforts. Based on this framework, a Risk Management policy has been adopted.

The Risk Register of each Business gets updated on an annual basis and is placed for due discussions at Board meetings and appropriateness of the mitigation measures to ensure that the risks remain relevant at any point in time and corresponding mitigation measures are optimized.

Further, as mandated under the amendments to the LODR Regulations in December 2018, the Risk Management Committee specifically covers cyber security risk assessment as part of its review at periodic intervals.

14. RELATED PARTY TRANSACTIONS

There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interests of the Company at large. All related party transactions are placed before the Audit Committee and the Board for approval, if applicable. Prior omnibus approval of the Audit Committee is obtained for the transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are verified by the Internal Auditor and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval, if applicable, on a quarterly basis. The Company has developed an Internal Guide on Related Party Transactions Manual and prescribed Standard Operating Procedures for purpose of identification and monitoring of such transactions. The Policy on Related Party Transactions as approved by the Board is uploaded on the Companyâs website. None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company. There were no transactions during the year which would require to be reported in Form AOC-2.

15. SUBSIDIARIES / JOINT VENTURE / ASSOCIATE COMPANY

As on 31st March 2019, the Company had the following subsidiaries/ Associate/ Joint Venture:

Sl. No.	Name of the Subsidiary/ Associate/ Joint venture	Relationship
1	Favre Leuba AG,	Wholly-owned
	Switzerland	Subsidiary
2	Titan Watch Company	Wholly-owned
	Limited, Hong Kong	Subsidiary
3	Titan Engineering &	Wholly-owned
	Automation Limited (TEAL) Subsidiary
4	Carat Lane Trading Private Limited	Subsidiary
5	Green Infra Wind Power Theni Limited	Associate
6	Montblanc India Retail Private Limited	Joint Venture

Titan TimeProducts Limited (TTPL) ceased to be a subsidiary of the Company with effect from 18th June 2018 consequent upon the Company transferring its entire stake in TTPL.

During the year 2018-19, Favre Leuba AG had registered a turnover of CHF 1 million i.e RS. 6.82 crore against the previous yearâs figures of CHF 0.9 million, i.e. RS. 6.05 crore and loss of CHF 7.37 million, i.e. RS. 52.01 crore (2017-18: 7.5 million, i.e. RS. 50.21 crore). During the year FY 2018-19, the Company has invested CHF 7 million in Favre Leuba AG.

Titan Watch Company Limited is a subsidiary of the Companyâs subsidiary Favre Leuba AG and hence is a subsidiary of the Company. It has a capital of HK $ 10,000 and no Profit and Loss account has been prepared as it has not yet commenced business.

During the year 2018-19, TEAL generated sales income of RS. 343.21 crore against the previous yearâs figures of RS. 252.13 crore and the profit before tax was RS. 58.06 crore against the previous yearâs figures of RS. 19.70 crore.

Carat Lane Trading Private Limited (Carat Lane) is engaged in the business of manufacture of jewellery products and has significant online presence. During the year 2018-19, Carat Lane has registered a turnover of RS. 416.39 crore (previous year: RS. 290.18 crore) and the loss amounted to RS. 46.13 crore against the previous yearâs figures (loss) of RS. 83.88 crore. During the year FY 2018-19, the Company had invested RS. 99.99 crore in purchase of additional equity stake in Carat Lane and accordingly increased its holding to 69.47%.

The annual accounts of these subsidiary companies/JV were consolidated with the accounts of Titan Company Limited for 2018-19. None of these subsidiary companies declared a dividend in 2018-19.

The Company holds a 49% equity stake in Montblanc India Retail Private Limited (Montblanc), a joint venture entered into with Montblanc Services B.V, the Netherlands for operation of retail boutiques in India for Montblanc products. Montblanc registered a turnover of RS. 57.04 crore and the loss amounted to RS. 1.22 crore (Profit After Tax).

The Company holds 26.79% stake in Green Infra Wind Power Theni Limited which supplies energy to the Company.

The statement containing salient features of the financial statement of subsidiaries/associate company/joint ventures in Form AOC-1 forms part of the Annual Report.

16. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under sub-section (3) (m) of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, are furnished in Annexure-I to the Boardâs Report.

17. CORPORATE SOCIAL RESPONSIBILITY (CSR)

A report on CSR is attached in Annexure-II.

18. EXTRACT OF ANNUAL RETURN

As provided under Section 92(3) of the Act, the extract of annual return is given in Annexure-III in the prescribed Form MGT-9, which forms part of this Report.

19. DIVIDEND DISTRIBUTION POLICY

The Dividend Distribution Policy is annexed as Annexure-Iv.

20. VIGIL MECHANISM

The Company has a whistle blower mechanism wherein the employees can approach the Management of the Company (Audit Committee in case where the concern involves the Senior Management) and make protective disclosures to the Management about unethical behaviour, actual or suspected fraud or violation of the Companyâs Code of Conduct and Insider Trading Code. The Whistle Blower Policy requires every employee to promptly report to the Management any actual or possible violation of the Code or an event an employee becomes aware of that could affect the business or reputation of the Company. The disclosures reported are addressed in the manner and within the time frames prescribed in the policy. A mechanism is in place whereby any employee of the Company has access to the Chairman of the Audit Committee to report any concern. No person has been denied access to the Chairman to report any concern. Further, the said policy has been disseminated within the organisation and has also been posted on the Companyâs website.

21. SECRETARIAL STANDARDS

The Directors state that the applicable Secretarial Standards i.e SS-1 and SS-2, issued by the Institute of Company Secretaries of India, relating to Meeting of Board of Directors and General Meetings respectively have been duly complied with.

22. DISCLOSURES AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has been at the forefront in ensuring a safe and secure work place for all its employees. In particular, as per the mandated policy of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder, prevention and redressal of complaints of sexual harassment at workplace are actively cascaded. The Company has adopted a zero tolerance for sexual harassment at workplace.

The selection and training of Internal Complaints Committee (ICC) members follows a stringent process to ensure that the most suitable person is part of the committee. This year, the Company has also empaneled its unionized employees at each of its manufacturing units for a better representation and reach of the employees. All members undergo the Prevention of Sexual Harrasment (POSH) training and are equipped to handle communication as well as redressal.

During the year under review, the total number of ICC members was at 64 as against 43 in 2016-17 and 2017-18.

All stakeholders viz. employees, contract and agency hires, vendors and associates are part of the communication cascades. The cascades are designed in a simple but effective manner by the use of regional theatre to demonstrate violations and the consequences. The core Ethics team comprising of the ICC Chairperson, the Chief Ethics Counsellor (CEC) and the regional heads or manufacturing heads are part of the Q&A at the end of the session at their respective locations. This has impacted positively with more and more stakeholders becoming familiar with the policy and gaining confidence to raise concerns with the respective office bearers. About 24 such events were held across the country covering over 10,000 stakeholders.

In terms of engagement, a short film competition was launched for the employees to participate and share their understanding of policies and unique situations of violations that may arise in their eco-systems in the form of a 2 minute silent film. This has gained popularity with an increased participation over last year. The details of the short film competition are as under:

Year	Registrations	Submissions -Ethical Violation Films	Submissions -pOSH films	Winners
2017-18	100	13	10	8
2018 -19	148	22	13	7

During the financial year 2018-19, the Company had receiveRs. 8 complaints on sexual harassment, 6 were disposed-off with appropriate action taken and 2 complaints remain pending as of 31st March 2019.

23. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12) OF SECTION 143 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

The Statutory Auditors of the Company have not reported any fraud as specified under the second proviso of Section 143(12) of the Companies Act, 2013 (including any statutory modification(s) or re-enactment(s) for the time being in force).

24. CORPORATE GOVERNANCE

As per LODR Regulations, Management Discussion and Analysis, Corporate Governance Report and Practicing Company Secretaryâs Certificate regarding compliance of conditions of Corporate Governance forms part of this Report.

25. BUSINESS RESPONSIBILITY REPORT

As per LODR Regulations, a Business Responsibility Report is attached and forms part of this Report.

26. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. T K. Balaji, Mrs. Hema Ravichandar, Mrs. Ireena Vittal, Mr. Ashwani Puri, Mr. B Santhanam and Mr. Pradyumna Vyas were the Independent Directors during the Financial Year 2018-19 and all have given declarations that they continue to meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 & Regulation 16(1)(b) of the LODR Regulations and that they are not debarred from holding the office of director by virtue of any SEBI order or any other such authority Prof. Das Narayandas, Independent Director resigned from the Board effective 25th January 2019 due to his increased pre-occupation with his academic assignments at Harvard Business School.

Mr. Pradyumna Vyas was appointed as an Additional Director and Independent Director on the Board of the Company with effect from 25th March 2019.

In accordance with the provisions of the Act and in terms of the Memorandum and Articles of Association of the Company, Mr. Harish Bhat retires by rotation at the Annual General Meeting.

Ms. Shilpa Prabhakar Satish was appointed as an Additional Director on the Board of the Company on 29th March 2018 but subsequently resigned effective 10th May 2018.

Mr. Arun Roy was appointed as an Additional Director on the Board of the Company with effect from 26th November 2018.

Mr. N Muruganandam was appointed as an Additional Director on the Board of the Company on 14th March 2019 in place of Mr. K Gnanadesikan whose nomination was withdrawn on 14th March 2019 by TIDCO.

The Board, on the basis of the recommendations made by the Nomination & Remuneration Committee has recommended for your approval, appointment of Mrs. Hema Ravichandar upto 31st July 2020 and Mrs. Ireena Vittal upto 29th January 2023 as Independent Director for a second term.

Memberâs attention is drawn to Item No. 5 of the Notice for the appointment of Mr. N Muruganandam as a Director of the Company, to Item No. 6 of the Notice for the appointment of Mr. V Arun Roy as a Director of the Company, to Item No. 7 of the Notice for appointment of Mr. Pradyumna Vyas as an Independent Director of the Company, to Item No. 8 of the Notice for re-appointment of Mrs. Hema Ravichandar upto 31st July 2020 and to Item No. 9 for re-appointment of Mrs. Ireena Vittal for a period upto 29th January 2023.

Mr. T K Balaji was appointed at the Annual General Meeting of the Company held on 1st August 2014 for a period of 5 years and will be holding his office till 31st July 2019.

None of the Directors is related to each other within the meaning of the term ârelativeâ as per Section 2(77) of the Act.

27. DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNED DURING THE YEAR

Details of directors who were appointed or resigned during the year are covered in point No. 26 of the Boardâs Report.

During the year, Mr. A R Rajaram - Vice President - Legal & Company Secretary retired from the services of the Company effective 30th June 2018 and Mr. Dinesh Shetty was appointed as the General Counsel & Company Secretary effective 3rd August 2018. Pursuant to the provisions of Section 203 of the Act, Mr. Bhaskar Bhat-Managing Director, Mr. S. Subramaniam - Chief Financial Officer and Mr. Dinesh Shetty - General Counsel & Company Secretary are the Key Managerial Personnel of the Company.

28. DIRECTORSâ RESPONSIBILITY STATEMENT

Based on the framework of Internal Financial Controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Companyâs internal financial controls are adequate and operating effectively.

Accordingly, pursuant to the requirements of Section 134 (5) of the Act, the Directors hereby confirm that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

iv they have prepared the annual accounts on a going concern basis;

v. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively;

vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

29. BOARD EVALUATION

Based on the questionnaire and feedback, the performance of every Director was evaluated by the Board Nomination and Remuneration Committee (BNRC).

Some of the key criteria for performance evaluation, as laid down by the BNRC were as follows:

Performance evaluation of Directors:

Contribution at Board / Committee meetings & Guidance/ support to Management outside Board/ Committee Meetings.

Performance evaluation of board and committees:

Board structure and composition, Degree of fulfillment of key responsibilities , Establishment and delineation of responsibilities to Committees , Effectiveness of Board Processes, Information and Functioning, Board Culture and Dynamics, Quality of relationship between the Board and Management , Efficacy of communication with External Stakeholders & Committees - strengths and areas of improvement.

30. INDEPENDENT DIRECTORS

A separate meeting of the independent directors (âAnnual ID Meetingâ) was convened, which reviewed the performance of the Board (as a whole), the nonindependent directors and the Chairman. Post the Annual ID Meeting, the collective feedback of each of the Independent Directors was discussed by the Chairperson of the BNRC with the Board covering performance of the Board as a whole, performance of the non-independent directors and performance of the Board Chairman.

31. REMUNERATION POLICY

The Board has, on the recommendation of the BNRC framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report.

32. POLICY ON DIRECTORSâ APPOINTMENT AND REMUNERATION AND OTHER DETAILS

In accordance with the agreement between the promoters, three Directors each may be nominated by Tata Sons Private Limited and Tamilnadu Industrial Development Corporation Limited.

The guidelines for selection of Independent Directors are as set out below:

The Board Nomination and Remuneration Committee (âCommitteeâ) oversees the Companyâs nomination process for Independent Directors and in that connection to identify, screen and review individuals qualified to serve as an Independent Director on the Board.

Process for selection

The Committee may act on its own in identifying potential candidates. The Committee shall review and discuss details pertaining to candidates and will conduct evaluation of candidates in accordance with the process that it sees fit and appropriate and thereafter pass on its recommendation for nomination to the Board, based on the following guidelines:

Attributes

i) The Committee shall seek candidates who is not a nominee or related to either Promoter of the Company. Such candidates shall possess integrity, leadership skills, managerial qualities, foresight abilities and competency required to direct and oversee the Companyâs management in the best interest of its stakeholders i.e. shareholders, customers, employees and communities it serves.

ii) The candidate must be willing to regularly attend the meetings of the Board and develop a strong understanding of the Company, itâs businesses and itâs needs, to contribute his/ her time and knowledge to the Company and to be prepared to exercise his/her duties with skill and care. Besides these, the candidate should have an understanding of governance concepts and legal duties of a Director.

iii) It is desirable that the candidate should have expertise to fill in the gap(s) identified by the Company in the current composition of the Board.

iv) Ideally the candidate should possess experience of 5 years on the board of a listed company.

v) The candidateâs age shall not exceeRs. 70 years at the time of joining the Board.

vi) Forthrightness and ability to possess foresight abilities in the Governance of a Corporate.

Board composition

Keeping in mind that women constitute a majority of the Companyâs customers it would be desirable to have one-third of the Boardâs strength represented by woman members.

Procedure

1. The Committee may retain search firms or advisors as it deems appropriate to identify candidates.

2. Develop a list of potential candidates of Independent Directors which may be refreshed every year. The Committee to create a list of probable candidates from known sources or from the database of Ministry of Corporate Affairs, Government of India or Stock Exchanges.

3. The Committee may also consider profiles of suitable expatriates.

4. The candidate considered by the Committee as potentially qualified will be contacted to determine their interest in being considered to serve on the Board and if interested will be interviewed.

As and when a candidate is shortlisted, the Committee will make a formal recommendation to the Board.

33. OTHER DISCLOSURES

The information required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

Sl. No.	Name of the director	Ratio (times)	% change
B]	Directorâs remuneration
1	Chairman (nominated by TIDCO)1	6.69	-22
2	Mr. Ramesh Chand Meena	7.71	617
3	Ms. Shilpa Prabhakar Satish2	0.59	100
4	Mr. Arun Roy3	1.40	-
5	Mr. N. N. Tata4	0.49	55
6	Mr. Harish Bhat4	0.79	43
7	Mr. T. K. Balaji	11.35	32
8	Mrs. Ireena Vittal	10.04	2
9	Mrs. Hema Ravichandar	10.04	17
10	Prof. Das Narayandas5	1.19	-
11	Mr. Ashwani Puri	9.72	4
12	Mr. B Santhanam6	5.58	-
13	Mr. Pradyumna Vyas7	0.55	-
14	Mr. Bhaskar Bhat (Managing Director)8	99.00	15
15	Mr. S.Subramaniam, Chief Financial Officer	-	44
16	Mr. Dinesh Shetty, General Counsel & Company Secretary9	-	-
17	Mr. A R Rajaram10	-	-

1 Commission to the Chairman of the Company (the Chairmanship was held by Mr. K Gnanadesikan upto 14th March 2019 and currently Mr. N Muruganandam is the Chairman).

2 Ms. Shilpa Prabhakar Satish, IAS, nominee of TIDCO, was appointed on the Board with effect from 29th March 2018 and resigned effective 10th May 2018.

3 Mr. Arun Roy, IAS, nominee of TIDCO was appointed effective 26th November 2018.

4 In line with the internal guidelines, no payment is made towards commission to Mr. Harish Bhat and Mr. N N Tata, Non-Executive Directors of the Company, who are in full-time employment with other Tata companies.

5 Prof. Das Narayandas resigned from the Board effective 25th January 2019.

6 Mr. B Santhanam was appointed as an Independent Director on the Board effective 10th May 2018.

7 Mr. Pradyumna Vyas was appointed as an Independent Director on the Board effective 25th March 2019.

8 I nclusive of salary, perquisites, commission (relates to FY ended 31st March 2019 which will be paid during FY 2019-20) and retiral benefits.

9 Mr. Dinesh Shetty was appointed as the Company Secretary and Compliance Officer of the Company effective 3rd August 2018.

10 Mr. A R Rajaram retired from the Company effective 30th June 2018.

ii) The percentage increase in the median remuneration of employees in the financial year: 10.5%

iii) The number of permanent employees on the rolls of company: 7,213

The average percentage increase this year has been 10.5% across all levels. Increase in the managerial remuneration is based on market trends and performance criteria as determined by the Board of Directors and on the recommendation of the Board Nomination & Remuneration Committee.

v) Affirmation that the remuneration is as per the Remuneration Policy of the Company:

The Companyâs Remuneration Policy is based on the principle of internal equity, competence and experience of the employee and industry standards. Through its compensation programme, the Company endeavours to attract, retain, develop and motivate a high performance and engaged workforce. The Company follows a compensation mix of fixed pay, benefits and performance based variable pay. Individual performance pay is determined by business performance and the performance of the individuals measured through the annual appraisal process. The Company affirms remuneration is as per the Remuneration Policy of the Company

34. INFORMATION AS PER RULE 5(2) OF THE CHAPTER XILL, THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014

The statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. Further, the report and the accounts are being sent to the members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection at the Registered Office of the Company. Any shareholder interested in obtaining a copy of the same may write to the Company Secretary.

35. AUDITORS

a) Statutory Auditors

Pursuant to the provisions of Section 139 of the Act read with applicable Rules framed thereunder, M/s. BSR & Co., LLP have been appointed as Auditors for a term of five years, subject to ratification by the shareholders, from the conclusion of the 33rd Annual General Meeting till the conclusion of the 38th Annual General Meeting.

The Ministry of Corporate Affairs vide Notification dateRs. 7th May 2018 notified several Sections of the Companies (Amendment) Act, 2017. In view of the said notification, the requirement of ratification of appointment of auditors, under Section 139 of the Companies Act, 2013, at each AGM is no longer required. Hence, the resolution to this item is not being included in the Notice to the AGM.

b) Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. KT Vijayakrishna, Practicing Company Secretary to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is annexed herewith as (Annexure-v).

36. AUDITORâS REPORT AND SECRETARIAL AUDITORâS REPORT

There are no disqualifications, reservations, adverse remarks or disclaimers in the auditorâs report and secretarial auditorâs report.

37. DISCLOSURES OF TRANSACTIONS OF THE LISTED ENTITY WITH ANY PERSON OR ENTITY BELONGING TO THE PROMOTER/PROMOTER GROUP WHICH HOLD(S) 10% OR MORE SHAREHOLDING IN THE LISTED ENTITY, IN THE FORMAT PRESCRIBED IN THE RELEVANT ACCOUNTING STANDARDS FOR ANNUAL RESULTS.

Related Party Transactions with Promoter/ Promoter Group holding 10% or more shares Tamilnadu Industrial Development Corporation Limited and Tata Sons Private Limited holRs. 10% or more shares in the Company. The details of transactions with promoter/promoter group holding 10% or more shares have been disclosed in the accompanying financial statements.

Acknowledgements

On behalf of the Board of Directors,

Bengaluru N N Tata Bhaskar Bhat

8th May 2019 Vice Chairman Managing Director

Mar 31, 2018

To the Members of Titan Company Limited

The Directors are pleased to present the Thirty Fourth Annual Report and the Audited Financial Statements for the year ended 31^st March, 2018:

1. FINANCIAL RESULTS

(Rs, in Crores)

standalone Consolidated
particulars	2017-2018 H	2016-2017	2017-2018 H	2016-2017
Revenue from Operations	15,656	12,999	16,156	13,383
Other Income	86	65	89	70
total Income	15,742	13,064	16,245	13,453
Expenditure	13,922	11,804	14,511	12,227
profit before exceptional items, finance costs, depreciation and taxes	1,820	1,260	1,734	1,226
Finance Costs	48	37	53	37
Depreciation / Amortisation	110	93	131	111
Profit before exceptional items and taxes	1,662	1,130	1,550	1,078
Exceptional items (VRS)	91	97	17	103
profit before taxes	1,571	1,033	1,533	975
Income taxes
- Current	446	300	450	302
- Deferred	-38	-29	-22	-26
profit after taxes for the year	1,163	762	1,105	699
Share of profit/(Loss) of a associate and Jointly controlled entity	-	-	-3	-2
Profit for the year	1,163	762	1,102	697
Attributable to
- Shareholders of the Company	1,163	762	1,130	711
- Non-controlling interests	-	-	-28	-14
Profit brought forward	1,268	1,012	1,190	984
appropriations
Dividend on Equity Shares (excluding tax)	-231	-	-231	-
Tax on dividends	-47	-	-47	-
Transfer to general reserve	-250	-506	-250	-505
Closing Balance in Retained Earnings	1,903	1,268	1,792	1,190

During the year under review, the Company''s revenue grew by 20.50 % to Rs, 15,656 crores compared with Rs, 12,999 crores in the previous year. Profit before tax grew by 52.60 % to Rs, 1,571 crores and the net profit increased 52.60 % to Rs, 1,163 crores.

The Watches business of the Company recorded revenue of Rs, 2,126 crores, a growth of 3.55% which was achieved through meticulous planning and execution of key initiatives. The revenue from Jewellery segment grew by 24.30% touching Rs, 13,036 crores. The revenue from Eyewear segment was flat at Rs, 415 crores. The revenue from other segments recorded a sale of Rs, 95 crores, a growth of 45.90%.

The year witnessed aggressive expansion of the Company''s retail network with a net addition of 114 stores. As on 31^st March 2018, the Company had 1,480 stores, with over 1.9 million square feet of retail space delivering a retail turnover of over Rs, 15,656 crores.

The Management Discussion and Analysis report, which is attached, dwells into the performance of each of the business division and the outlook for the current year.

2. INTERNATIONAL OPERATIONS

Despite challenges, Watches export almost delivered the budgeted bottom-line. While Far East markets like Vietnam, Thailand, Philippines responded with high double digit growths to the several marketing innovations, the steep decline in higher contributing, economically troubled Middle East markets left the overall business with a 14% decline for the year. A comprehensive plan to address this is underway through diversification into the consumer and market pools through more cost-effective channels like e-commerce. Amazon tie-up in USA is seeding well and holds promise.

3. DIVIDEND

The Directors are pleased to recommend the payment of dividend on equity shares at the rate of 375% (i.e. Rs, 3.75 per equity share of Rs, 1 each), subject to approval by the shareholders at the Annual General Meeting (AGM).

4. TRANSFER TO GENERAL RESERVE

An amount of Rs, 250 crores is proposed to be transferred to the general reserve.

5. FINANCE

The Company expects macro economic situation to improve with real GDP growth around 7.5% for the fiscal year 2018-19. The impact that the twin measures of demonetization and introduction of GST had on the economy seem to be over. Compliance under GST has settled down and one of the impacts it has had on the Balance Sheet is the increase in working capital as IGST is now paid on stocks lying in the stores or at warehouses. High gold prices and stricter regulation have impacted growth in the jewellery industry and the company expects to grow through gains in market share.

6. PUBLIC DEPOSITS

The Jewellery Division of the Company was successfully operating customer schemes for jewelry purchases for many years. When the Companies Act, 2013 (the "Act") became substantially effective from 1^st April 2014, the Company had around seven lakh subscribers contributing to these schemes. However, these schemes were exempt under the Companies Act, 1956 relating to acceptance of public deposits as such schemes were not covered in the definition of deposits. Under the Act and Regulations made there under (''Deposit Regulations'') the scope of the term "deposit" was enlarged and therefore a view was taken that the jewelry purchase schemes offered by the Company to its customers would be treated as public deposits. Thereupon, the Company discontinued fresh enrolment of subscribers and initiated steps to close the erstwhile customer schemes, which were wound down by 31^st August 2014.

Under the Deposit Regulations as amended from time to time, a company is permitted to accept deposits subject to applicable provisions, to the extent of 35% of the aggregate paid-up share capital and free reserves from public including a ceiling of 10% of the aggregate paid-up share capital and free reserves from Members of the company, after prior approval by way of a special resolution passed by the Members in this behalf. Requisite approval was obtained from the Members of the Company and a new customer scheme for jewelry purchase was launched in November 2014 in compliance with the Deposit Regulations.

The details relating to deposits, covered under Chapter V of the Companies Act, 2013 are as under:

(a) accepted during the year: Rs, 1,684.82 crores

(b) remained unpaid or unclaimed as at the end of the year: Rs, 1,038.51 crores

(c) whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved-

(i) at the beginning of the year: Nil

(ii) maximum during the year: Nil

(iii) at the end of the year: Nil

There are no deposits that have been accepted by the Company that are not in compliance with the requirements of Chapter V of the Act.

7. MATERIAL CHANGES And COMMITMENTS AFFECTING FINANCIAL pOSITION BETwEEN END OF The FINANCIAL YEAR AND DATE OF report

There have been no material changes and commitments affecting financial position between end of the financial year and the date of the report.

8. SIGNIFICANT AND MATERIAL ORDERS

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations in future.

9. particulars OF LOANS, GUARANTEES AND INVESTMENTS

The particulars of loans, guarantees and investments have been disclosed in the financial statements. The particulars of loans given as part of treasury operations of the Company bearing interest ranging from 7.30 % to 10.25 % p.a. are provided in Note 35 of the Standalone Financial Statements covered in the Annual Report.

10. CONTRIBUTION TO Exchequer

During the year under review, the Company made payments aggregating Rs, 2,361 crores by way of taxes (central, state and local) and duties as against Rs, 1,043 crores in the previous year.

11. adequacy OF INTERNAL CONTROLS AND COMpLIANCE wITH LAwS

The Company during the year has reviewed its Internal Financial Control (IFC) systems and has continually contributed to establishment of more robust and effective IFC framework, prescribed under the ambit of Section 134(5) of Companies Act, 2013. The preparation and presentation of the financial statements is pursuant to the control criteria defined considering the essential components of Internal Control - as stated in the "Guidance Note on Audit of Internal Financial Controls

Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI)".

The control criteria ensures the orderly and efficient conduct of the Company''s business, including adherence to its policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

There were no instances of fraud which necessitates reporting of material misstatement to the Company''s operations.

There has been no communication from regulatory agencies concerning non-compliance with or deficiencies in financial reporting practices.

12. AUDIT COMMITTEE

The details pertaining to the composition of the audit committee are included in the Corporate Governance Report, which is a part of this report.

13. RISK MANAGEMENT

Pursuant to the requirement of Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "Listing Regulations"), the Company has constituted a Risk Management Committee.

The Company has in place a Risk Management framework to identify, evaluate business risks and challenges across the Company both at corporate level as also separately for each business division.

The top tier of risks for the Company is captured by the operating management after extensive deliberations on the nature of the risk being a gross or a net risk and thereafter in a prioritized manner presented to the Board for their inputs on risk mitigation/ management efforts. Based on this framework, a Risk Management policy has been adopted.

The Board engages in the Risk Management process and has set out a review process so as to report to the Board the progress on the initiatives for the major risks of each of the businesses that the Company is into.

The Board Audit Committee (BAC) has been engaged in reviewing the Information Technology initiatives and governance mechanisms pertaining to information security. The BAC also reviewed the new IT controls incorporated to comply with IFC requirements mandated by the Companies Act, 2013.

14. related party transactions

There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interests of the Company at large. All related party transactions are placed before the Audit Committee and the Board for approval, if applicable. Prior omnibus approval of the Audit Committee is obtained for the transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are verified by the Internal Auditor and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval, if applicable, on a quarterly basis. The Company has developed an Internal Guide on Related Party Transactions Manual and prescribed Standard Operating Procedures for purpose of identification and monitoring of such transactions. The Policy on Related Party Transactions as approved by the Board is uploaded on the Company''s website. None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company. There were no transactions during the year which would require to be reported in Form AOC-2.

15. subsidiaries / joint venture / associate company

As on 31^st March 2018, the Company had the following subsidiaries/ Associate/ Joint Venture:

sl. No.	Name of the subsidiary/ Associate/ Joint venture	Relationships
1	Titan Time Products Limited, Goa (TTPL)	Subsidiary
2	Favre Leuba AG, Switzerland	Subsidiary
3	Titan Watch Company Limited, Hong Kong	Subsidiary
4	Titan Engineering & Automation Limited (TEAL)	Subsidiary

sl. No.	Name of the subsidiary/ Associate/ Joint venture	Relationship
5	Carat Lane Trading Private Limited	Subsidiary
6	Green Infra Wind Power Theni Limited	Associate
7	Montblanc Retail India Private Limited	Joint Venture

During the year 2017-18, TTPL sold a total number of 35,82,992 ECBs and micro assemblies (previous year: 32,84,030 nos.). Sales income during the year was Rs, 39.76 crores against the previous year''s figure of Rs, 37.08 crores and the profit before tax was Rs, 1.83 crores against the previous year''s figures of Rs, 1.17 crores . The quality, delivery and competitive price of the products continue to be well-received by the Holding Company and external customers.

During the year 2017-18, Favre Leuba AG had registered a turnover of CHF 0.9 million i.e Rs, 6.05 crores against the previous year''s figures of CHF 1.27 million, i.e Rs, 8.61 crores and loss of CHF 7.5 million, i.e Rs, 50.21 crores (2016-17: 4.31 million, i.e. Rs, 29 crores).

Titan Watch Company Limited is a subsidiary of the Company''s subsidiary Favre Leuba AG and hence is a subsidiary of the Company. It has a capital of HK $ 10,000 and no Profit and Loss account has been prepared as it has not yet commenced business.

TEAL was incorporated on 24^th March 2015 to acquire the Precision Engineering Business of the Company through a court approved Scheme of Arrangement which was approved by the Hon''ble High Court of Judicature at Madras vide its order dated 12^th December 2016. During the year 2017-18 TEAL generated sales income of Rs, 252.13 crores against the previous year''s figures of Rs, 244.60 crores and the profit before tax was Rs, 19.70 cores against the previous year''s figures of Rs, 9.98 crores.

Carat Lane Trading Private Limited (Carat Lane) is engaged in the business of manufacture of jewellery products and has significant online presence. During the year 2017-18 Carat Lane has registered a turnover of Rs, 290.18 crores (previous year : Rs, 177.84 crores) and the loss amounted to Rs, 83.87 crores against the previous year''s figures (loss) of Rs, 41.01 crores.

The annual accounts of these subsidiary companies were consolidated with the accounts of Titan Company Limited for 2017-18. None of these subsidiary companies declared a dividend in 2017-18.

The Company holds a 49% equity stake in a joint venture entered into with Montblanc Services B.V., the Netherlands for operation of retail boutiques in India for Montblanc products.

The Company holds 26.79% stake in Green Infra Wind Power Theni Limited which supplies energy to the Company.

The statement containing salient features of the financial statement of subsidiaries/associate company/joint venture forms part of the Annual Report and furnished in the financial statements.

16. CONSERvATION OF ENERGY, TECHNOLOGY ABSORpTION, FOREIGN ExCHANGE EARNINGS AND OUTGO

The particulars as prescribed under sub-section (3) (m) of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, are furnished in Annexure- I to the Board''s Report.

17. CORPORATE SOCIAL RESPONSIBILITY (CSR)

A report on CSR is attached in Annexure II.

18. EXTRACT OF ANNUAL RETURN

As provided under Section 92(3) of the Act, the extract of annual return is given in Annexure-III in the prescribed Form MGT-9, which forms part of this Report.

19. DIVIDEND DISTRIBUTION POLICY

The Dividend Distribution Policy is annexed as Annexure-Iv.

20. VIGIL MECHANISM

The Company has a whistle blower mechanism wherein the employees can approach the Management of the Company (Audit Committee in case where the concern involves the Senior Management) and make protective disclosures to the Management about unethical behavior, actual or suspected fraud or violation of the Company''s Code of Conduct. The Whistle Blower Policy requires every employee to promptly report to the Management any actual or possible violation of the Code or an event he becomes aware of that could affect the business or reputation of the Company. The disclosures reported are addressed in the manner and within the time frames prescribed in the policy. A mechanism is in place whereby any employee of the Company has access to the Chairman of the Audit Committee to report any concern. No person has been denied access to the Chairman to report any concern. Further, the said policy has been disseminated within the organization and has also been posted on the Company''s website.

21. SECRETARIAL STANDARDS

22. DISCLOSURES AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules there under for prevention and redressal of complaints of sexual harassment at workplace.

During the financial year 2017-18, the Company had received 11 complaints on sexual harassment, all were disposed-off with appropriate action taken and no complaint remains pending as of 31^st March 2018.

23. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12) OF SECTION 143 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

24. CORPORATE GOVERNANCE

As per SEBI Listing Regulations, a Management Discussion and Analysis, Corporate Governance Report and Auditors'' Certificate regarding compliance of conditions of Corporate Governance forms part of the Annual Report.

25. BUSINESS RESPONSIBILITY REPORTING

As per SEBI Listing Regulations, a Business Responsibility Report is attached and forms part of this Annual Report.

26. DIRECTORS AND Key MANAGERIAL PERSONNEL

Mr. T.K. Balaji, Mrs. Hema Ravichandar, Prof. Das Narayandas, Mrs. Ireena Vittal, Ms. Vinita Bali and Mr. Ashwani Puri are the Independent Directors during the Financial Year 2017-18 and all have given declarations that they continue to meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 25 of the Listing Regulations.

Subsequently, Ms. Vinita Bali, Independent Director resigned from the Board effective 1^st April 2018.

Mr. B Santhanam was appointed as an Additional Director and Independent Director on the Board of the Company on 10^th May 2018. Member''s attention is drawn to Item No. 4 of the Notice for appointment of Mr. B Santhanam as an Independent Director of the Company.

In accordance with the provisions of the Act and in terms of the Memorandum and Articles of Association of the Company, Mr. N N Tata retires by rotation at the Annual General Meeting.

Mr. Ramesh Chand Meena was appointed as an Additional Director on the Board of the Company on 3^rd January 2018, Mr. K. Gnanadesikan was appointed as an Additional Director on the Board of the Company on 1^st February 2018. Ms. Shilpa Prabhakar Satish was appointed as an Additional Director on the Board of the Company on 29^th March 2018 but subsequently resigned effective 10^th May 2018. Member''s attention is drawn to Item No. 5 of the Notice for the appointment of Mr. K. Gnanadesikan as a Director of the Company & Item No. 6 of the Notice for the appointment of Mr. Ramesh Chand Meena as a Director of the Company.

None of the Directors is related to each other within the meaning of the term "relative" as per Section 2(77) of the Act.

Five meetings of the Board were held during the year. For details of the meetings of the Board, reference may be made to the Corporate Governance Report, which forms part of the Annual Report.

27. DETAILs OF DIRECTORs AND KEY MANAGERIAL personnel who were appointed or have resigned during the year

Pursuant to Section 134 of the Act read with Rule 8(5)

(iii) of Companies (Accounts) Rules, 2014, the following Directors were appointed or resigned.

Mr. T. K. Arun, nominee of Tamilnadu Industrial Development Corporation Limited (TIDCO), retired from the services of TIDCO and consequently resigned from the Board effective 11^th November 2017.

Mr. Ramesh Chand Meena nominee of TIDCO was appointed to the Board with effect from 3^rd January 2018.

Mr. K Gnanadesikan, nominee of TIDCO was nominated as Chairman of the Board with effect from 1^st February 2018 in place of Mr. Atulya Misra who resigned from the Board effective from 1^st February 2018.

Ms. Shilpa Prabhakar Satish, nominee of TIDCO was appointed to the Board with effect from 29^th March 2018 and subsequently resigned effective 10^th May 2018.

None of the Key Managerial Personnel were appointed or resigned during the year. Pursuant to the provisions of Section 203 of the Act, Mr. Bhaskar Bhat-Managing Director, Mr. S. Subramaniam - Chief Financial Officer and Mr. A.R. Rajaram-Vice President - Legal & Company Secretary continue to be the Key Managerial Personnel of the Company.

28. directors'' responsibility statement

Based on the framework of Internal Financial Controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company''s internal financial controls are adequate and operating effectively during FY2017-18.

Accordingly, pursuant to the requirements of Section 134 (5) of the Act, the Directors hereby confirm that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

iv. they have prepared the annual accounts on a going concern basis;

v. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively;

vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

29. BOARD EVALUATION

The performance evaluation of the Board, its Committees and individual Directors was conducted and the same was based on questionnaire and feedback from all the Directors on the Board as a whole, its Committees and self-evaluation pursuant to the provisions of the Companies Act, 2013, SEBI Listing Regulations and the Guidance Note on Board''s Evaluation issued by SEBI on 5^th January, 2017.

The Chairperson of the Board Nomination and Remuneration Committee (BNRC) held separate discussions with each of the Directors of the Company and obtained their feedback on overall Board effectiveness as well as on each of the other Directors.

Based on the questionnaire and feedback, the performance of every Director was evaluated by the BNRC.

Some of the key criteria for performance evaluation, as laid down by the BNRC were as follows-

performance evaluation of Directors:

- Contribution at Board / Committee meetings

- Guidance / Support to Management outside Board/ Committee Meetings

performance evaluation of Board and Committees:

- Board structure and composition

- Degree of fulfillment of key responsibilities

- Establishment and delineation of responsibilities to Committees

- Effectiveness of Board Processes, Information and Functioning

- Board Culture and Dynamics

- Quality of relationship between the Board and Management

- Efficacy of communication with External Stakeholders

- Committees - strengths and areas of improvement

30. INDEPENDENT DIRECTORS

A separate meeting of the independent directors ("Annual ID Meeting") was convened, which reviewed the performance of the Board (as a whole), the no independent directors and the Chairman. Post the Annual ID Meeting, the collective feedback of each of the

Independent Directors was discussed by the Chairperson of the BNRC with the Board covering performance of the Board as a whole, performance of the non-independent directors and performance of the Board Chairman.

31. REMUNERATION POLICY

32. POLICY ON DIRECTORS'' APPOINTMENT AND REMUNERATION AND OTHER DETAILS

In accordance with the agreement between the promoters, three Directors each may be nominated by Tata Sons Limited and Tamilnadu Industrial Development Corporation Limited.

The guidelines for selection of Independent Directors are as set out below:

The Board Nomination and Remuneration Committee ("Committee") oversees the Company''s nomination process for Independent Directors and in that connection to identify, screen and review individuals qualified to serve as an Independent Director on the Board.

process for selection

Attributes

i) The Committee shall seek candidates who is not a nominee or related to either Promoter of the Company. Such candidates shall possess integrity, leadership skills, managerial qualities, foresight abilities and competency required to direct and oversee the Company''s management in the best interest of its stakeholders i.e. shareholders, customers, employees and communities it serves.

ii) The candidate must be willing to regularly attend the meetings of the Board and develop a strong understanding of the Company, it''s businesses and it''s needs, to contribute his/ her time and knowledge to the Company and to be prepared to exercise his/her duties with skill and care. Besides these, the candidate should have an understanding of governance concepts and legal duties of a Director.

iii) It is desirable that the candidate should have expertise to fill in the gap(s) identified by the Company in the current composition of the Board.

iv) Ideally the candidate should possess experience of 5 years on the Board of a listed company.

v) The candidate''s age shall not exceed 70 years at the time of joining the Board.

vi) Forthrightness and ability to possess foresight abilities in the Governance of a Corporate.

Board Composition

Keeping in mind that women constitute a majority of the Company''s customers it would be desirable to have one-third of the Board''s strength represented by woman members.

33. OTHER DISCLOSURES

The information required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

i) The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year:

sl.	Name of the director	Commission	sitting fee	Total	Ratio
No.		(?)	(?)	(?)	(times)
A]	Median Employee remuneration			6,20,580
B]	Director''s remuneration
1	Chairman (nominated by TIDCO)#	58,01,667	2,05,000	60,06,667	9.68
2	Mr. T. K. Arun@	26,74,667	1,80,000	28,54,667	4.60
3	Mr. Ramesh Chand Meena@	7,03,083	50,000	7,53,083	1.21
4	Ms. Shilpa Prabhakar Satish@	2,06,500	Nil	2,06,500	0.33
5	Mr. N. N. Tata^A	Refer note below	2,20,000	2,20,000	0.35
6	Mr. Harish Bhat^A	Refer note below	3,85,000	3,85,000	0.62
7	Mr. T. K. Balaji	56,05,000	4,30,000	60,35,000	9.72
8	Ms. Vinita Bali	74,31,000	3,95,000	78,26,000	12.61
9	Mrs. Ireena Vittal	64,31,000	4,85,000	69,16,000	11.14
10	Mrs. Hema Ravichandar	56,64,000	3,60,000	60,24,000	9.71
11	Prof. Das Narayandas	14,16,000	50,000	14,66,000	2.36
12	Mr. Ashwani Puri	61,36,000	3,85,000	65,21,000	10.51
13	Mr. Bhaskar Bhat*	3,97,44,000	-	6,61,30,366*	106.56

Note: Remuneration includes sitting fees and commission for Non-Executive Directors. Commission relates to financial year ended 31st March 2018, which will be paid during the FY 2018-19.

# Commission to the Chairman of the Company is paid to TIDCO (the Chairmanship was held by Mr. Atulya Misra upto 1^st February 2018 and currently Mr. K Gnanadesikan is the Chairman.)

^A In line with the internal guidelines, no payment is made towards commission to Mr. N N Tata and Mr. Harish Bhat , Non Executive Directors of the Company, who are in full-time employment with other Tata Companies.

* Inclusive of salary, perquisites, Commission and retiral benefits.

@ Paid to TIDCO

procedure

1. The Committee may retain search firms or advisors as it deems appropriate to identify candidates.

3. The Committee may also consider profiles of suitable expatriates.

4. The candidate considered by the Committee as potentially qualified will be contacted to determine their interest in being considered to serve on the Board and if interested will be interviewed.

As and when a candidate is shortlisted, the Committee will make a formal recommendation to the Board.

iii) The percentage increase in the median remuneration of employees in the financial year: 11 %

ii) The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:

Name	% Change
Chairman (nominated by TIDCO)	9%
Mr. Ramesh Chand Meena¹	-
Mr. T.K. Arun²	-
Ms. Shilpa Prabhakar Satish³	-
Mr. N.N. Tata⁴	-
Mr. Harish Bhat⁴	-
Mr. T.K. Balaji	36%
Ms. Vinita Bali	107%
Mrs. Hema Ravichandar	28%
Prof. Das Narayandas	10%
Mrs. Ireena Vittal	56%
Mr. Ashwani Puri	81%
Mr. Bhaskar Bhat, Managing Director	14%
Mr. S.Subramaniam, Chief Financial Officer	14%
Mr. A.R Rajaram, Company Secretary	19%

1 Mr. Ramesh Chand Meena, nominee of TIDCO, was appointed on the Board with effect from 3^rd January 2018, hence previous year figures are not comparable

2 Mr. T.K Arun, nominee of TIDCO, retired from the services of TIDCO and hence resigned from the Board effective 11^th November 2017.

3 Ms. Shilpa Prabhakar Satish, nominee of TIDCO, was appointed on the Board with effect from 29^th March 2018, , hence previous year figures are not comparable.

4 In line with the internal guidelines, no payment is made towards commission to Mr. N N Tata and Mr. Harish Bhat , Non Executive Directors of the Company, who are in full-time employment with other Tata Companies.

iv) The number of permanent employees on the rolls of company: 6,856.

v) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

The average percentage increase this year has been 11% across all levels.

vi) Affirmation that the remuneration is as per the Remuneration Policy of the Company:

The Company''s Remuneration Policy is based on the principle of internal equity, competence and experience of the employee and industry standards. Through its compensation programme, the Company endeavours to attract, retain, develop and motivate a high performance and engaged workforce. The Company follows a compensation mix of fixed pay, benefits and performance based variable pay. Individual performance pay is determined by business performance and the performance of the individuals measured through the annual appraisal process. The Company affirms remuneration is as per the Remuneration Policy of the Company.

34. INFORMATION AS pER RULE 5(2) OF THE chapter

XILL, THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL personnel) RULES, 2014

35. AUDITORs

a) statutory Auditors

Pursuant to the provisions of Section 139 of the Act read with applicable Rules framed thereunder, M/s. B S R & Co. LLP Chartered Accountants (Firm Registration No.101248W/W-100022) have been appointed as Auditors for a term of five years, subject to ratification by the shareholders, from the conclusion of the 33^rd Annual General Meeting till the conclusion of the 38^th Annual General Meeting.

The Ministry of Corporate Affairs vide Notification dated 7^th May 2018 notified several Sections of the Companies (Amendment) Act, 2017. In view of the said notification, the requirement of ratification of appointment of auditors, under Section 139 of the Companies Act, 2013, at each AGM is no longer required. Hence, the resolution to this item is not being included in the Notice to the AGM.

b) secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. KT Vijayakrishna, Practicing Company Secretary to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is annexed herewith as Annexure-v.

36. AUDITOR''s REPORT AND SECRETARIAL auditor''s report

There are no disqualifications, reservations, adverse remarks or disclaimers in the auditor''s report and secretarial auditor''s report.

Acknowledgements

On behalf of the Board of Directors,

Bengaluru k. Gnanadesikan

10^th May 2018 Chairman

Mar 31, 2017

To the Members of Titan Company Limited

The Directors are pleased to present the Thirty Third Annual Report and the Audited Statement of Accounts for the year ended 31st March 2017:

1. FINANCIAL RESULTS

Pursuant to the notification dated February 16, 2015 issued by the Ministry of Corporate Affairs, the Company has adopted the Indian Accounting Standards (âInd AS â) notified under the Companies (Indian Accounting Standards) Rules, 2015 with effect from April 1, 2016. Financial statements for the year ended and as at March 31, 2016 have been restated to conform to Ind AS. Note 3 to the consolidated financial statement provides further explanation on the transition to Ind AS.

(Rs. Crores)

	Standalone		Consolidated
	2016-17	2015-16	2016-17	2015-16
Sales Income	12,716.89	11,105.38	13,100.16	11,310.02
Other Income	64.77	73.16	70.49	73.92
Total Income	12,781.66	11,178.54	13,170.65	11,383.94
Expenditure	11,521.51	10,160.74	11,944.67	10,375.28
Profit before exceptional items, finance costs, depreciation and taxes	1,260.15	1,017.80	1,225.98	1,008.66
Finance Costs	37.13	42.28	37.74	42.36
Depreciation / Amortisation	93.23	87.12	110.53	98.19
profit before exceptional items and taxes	1,129.79	888.40	1,077.71	868.11
exceptional items (VRs)	96.37	-	102.69
Profit before taxes	1,033.42	888.40	975.02	868.11
Income taxes
- Current	300.00	170.30	302.11	170.96
- Deferred	(28.44)	20.53	(26.14)	20.63
profit after taxes for the year	761.86	697.57	699.05	676.52
share of profit/(Loss) of a associate and Jointly controlled entity	-	-	(1.77)	(2.00)
profit for the year	761.86	697.57	697.28	674.52
attributable to
- shareholders of the Company	761.86	697.57	711.47	674.52
- Non-controlling interests	-	-	(14.19)	-
profit brought forward	1,012.22	1,316.74	984.27	1311.84
Appropriations
Interim dividend	-		-	-
proposed dividend on equity shares	-	(399.50)	-	(399.50)
Tax on dividends	-	(81.33)	-	(81.33)
Transfer to general reserve	(506.06)	(521.26)	(506.06)	(521.26)
Balance carried forward	1,268.02	1,012.22	1,189.68	984.27

During the year under review, the Companyâs sales income grew by 14.5 % to Rs.12,716.89 crores compared with Rs.1 1,105.38 crores in the previous year. Profit before tax grew by 16.3 % to Rs.1,033.42 crores and the net profit increased 9.2 % to Rs.761.86 crores. This performance came in the backdrop of an environment where the consumer sentiment did not pick up as expected and regulatory measures adversely affected the jewellery business.

The Watches business of the Company recorded an income of Rs.2,027.56 crores, a growth of 2.7% which was achieved through meticulous planning and execution of key initiatives. The income from Jewellery segment grew by 17.4% touching Rs.10,237.28 crores. The income from Eyewear segment grew by 8.4% touching Rs.405.80 crores. The income from other segments recorded a sale of Rs.64.69 crores, a growth of 18.4%.

The year witnessed aggressive expansion of the Companyâs retail network with a net addition of 84 stores. As on 31^st March 2017, the Company had 1,366 stores, with over 1.8 million square feet of retail space delivering a retail turnover of just over Rs.12,700 crores.

The Management Discussion and Analysis report, which is attached, dwells into the performance of each of the business division and the outlook for the current year.

2. INTERNATIONAL OPERATIONS

Watches export business had a very tough year on account of full blown impact of oil price effects in Middle East markets. Currency devaluation in Malaysia and Singapore, change of partner in Vietnam and closure of some key accounts in South East markets added to net drop of over 21% in business. However, the business delivered better bottom-line and profit margin this year, on the back of tight control on costs and sale of richer product mix. The business is aiming to consolidate business in FY18 while targeting sharper investments.

3. DIVIDEND

The Directors are pleased to recommend the payment of dividend on equity shares at the rate of 260% (Rs.2.60 per equity share), subject to approval by the shareholders at the Annual General Meeting (AGM).

4. TRANSFER TO GENERAL RESERVE

An amount of Rs.506.06 crores is proposed to be transferred to the general reserve.

5. FINANCE

Macro-economic conditions are expected to be marginally better in the next fiscal with a real GDP growth of a little over 7%. GST is likely to be rolled out from 1^st July 2017. The Company is in the process of changes in system and processes, including IT platform to ensure readiness in the new GST regine. It has also been working on generating awareness among all business associates, including franchisees and vendors regarding changes under GST to cope with the new indirect tax regime.

6. PUBLIC DEPOSITS

The Jewellery Division of the Company was successfully operating customer schemes for jewellery purchases for many years. When the Companies Act, 2013 (the âActâ) became substantially effective from 1^st April 2014, the Company had around seven lakh subscribers contributing to these schemes. However, these schemes were exempt under the Companies Act, 1956 relating to acceptance of public deposits as such schemes were not covered in the definition of deposits. Under the Act and Regulations made there under (âDeposit Regulationsâ) the scope of the term âdepositâ was enlarged and therefore a view was taken that the jewellery purchase schemes offered by the Company to its customers would be treated as public deposits. Thereupon, the Company discontinued fresh enrolment of subscribers and initiated steps to close the erstwhile customer schemes, which were wound down by 31^st August 2014.

Under the Deposit Regulations as amended from time to time, a company is permitted to accept deposits subject to applicable provisions, to the extent of 35% of the aggregate paid-up share capital and free reserves from public including a ceiling of 10% of the aggregate paid-up share capital and free reserves from Members of the company, after prior approval by way of a special resolution passed by the Members in this behalf. Requisite approval was obtained from the Members of the Company and a new customer scheme for jewellery purchase was launched in November 2014 in compliance with the Deposit Regulations.

The details relating to deposits, covered under Chapter V of the Companies Act, 2013 are as under:

(a) accepted during the year: Rs.1,224.72 crores

(b) remained unpaid or unclaimed as at the end of the year: Rs.743.60 crores

(c) whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved-

(i) at the beginning of the year: Nil

(ii) maximum during the year: Nil

(iii) at the end of the year: Nil

There are no deposits that have been accepted by the Company that are not in compliance with the requirements of Chapter V of the Act.

7. MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN END OF THE FINANCIAL YEAR AND DATE OF REPORT

There have been no material changes and commitments affecting financial position between end of the financial year and the date of the report.

8. SIGNIFICANT AND MATERIAL ORDERS

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Companyâs operations in future.

9. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

The particulars of loans, guarantees and investments have been disclosed in the financial statements.

There have been no investments made or guarantees given under Section 186 of the Companies Act, 2013 during the year under review. The particulars of loans given as part of treasury operations of the Company bearing interest ranging from 8.60% to 9.65% p.a. are provided in Note 36 of the Standalone Financial Statements covered in the Annual Report.

10. CONTRIBUTION TO EXCHEQUER

During the year under review, the Company made payments aggregating Rs.1,043 crores by way of taxes (central, state and local) and duties as against Rs.931 crores in the previous year.

11. ADEQUACY OF INTERNAL CONTROLS AND COMPLIANCE WITH LAWS

The preparation and presentation of the financial statements is pursuant to the control criteria defined considering the essential components of Internal control - as stated in the âGuidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI)â.

There were no instances of fraud which necessitates reporting of material misstatement to the Companyâs operations.

There has been no communication from regulatory agencies concerning non-compliance with or deficiencies in financial reporting practices.

12. RISK MANAGEMENT

Pursuant to the requirement of Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the âListing Regulationsâ), the Company has constituted a Risk Management Committee.

The Company has in place a Risk Management framework to identify, evaluate business risks and challenges across the Company both at corporate level as also separately for each business division.

The top tier of risks for the Company is captured by the operating management after extensive deliberations on the nature of the risk being a gross or a net risk and thereafter in a prioritized manner presented to the Board for their inputs on risk mitigation/ management efforts. Based on this framework, a Risk Management policy has been adopted.

13. RELATED PARTY TRANSACTIONS

14. SUBSIDIARIES / JOINT VENTURE / ASSOCIATE COMPANY

As on 31^st March 2017, the Company had the following subsidiaries:

i) Titan Time Products Limited, Goa (TTPL)

ii) Favre Leuba AG, Switzerland

iii) Titan Watch Company Limited, Hong Kong

iv) Titan Engineering & Automation Limited and

v) Carat Lane Trading Private Limited

During the year 2016-2017, TTPL sold a total no. of 32,84,030 ECBs and micro assemblies (previous year: 59,68,000 nos.). Net sales income during the year was Rs.37.08 crores against the previous yearâs figure of Rs.28.52 crores. The quality, delivery and competitive price of the products continue to be well-received by the Holding Company and external customers.

As at 31^st March 2017, Favre Leuba AG had registered a loss of CHF 4.31 million, i.e. Rs.29 crores (2015-16: CHF 1.88 million i.e. Rs.13.00 crores) which apart from amortization of trademarks design and development expenses, includes operating expenses incurred in preparation of product launches which commenced in late 2016.

Titan Engineering & Automation Limited (TEAL) was incorporated on 24^th March 2015 to acquire the Precision Engineering Business of the Company through a court approved Scheme of Arrangement which was approved by the Honâble High Court of judicature at Madras vide its order dated 12^th December 2016.

A majority stake was acquired in Carat Lane Trading Private Limited which is engaged in the business of manufacture of jewellery products and has a significant online presence. Carat Lane Trading Private Limited became a subsidiary on 4^th August 2016 and has registered a turnover of Rs.177.84 crores in 2016-17.

The annual accounts of these subsidiary companies were consolidated with the accounts of Titan Company Limited for 2016-17. None of these subsidiary companies declared a dividend in 2016-17.

The Company holds a 49% equity stake in a joint venture entered into with Montblanc Services B.V, the Netherlands for operation of retail boutiques in India for Montblanc products.

The Company holds 26.79% stake in Green Infra Wind Power Theni Limited which supplies energy to the Company.

The statement containing salient features of the financial statement of subsidiaries/associate company/ joint venture forms part of the Annual Report and is furnished in the finanical statements.

15. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under sub-section (3) (m) of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, are furnished in Annexure- I to the Boardâs Report.

16. CORPORATE SOCIAL RESPONSIBILITY (CSR)

A report on CSR is attached in Annexure II.

17. EXTRACT OF ANNUAL RETURN

As provided under Section 92(3) of the Act, the extract of annual return is given in Annexure-III in the prescribed Form MGT-9, which forms part of this Report.

18. DIVIDEND DISTRIBUTION POLICY

The Dividend Distribution Policy is annexed as Annexure-IV.

19. VIGIL MECHANISM

The disclosures reported are addressed in the manner and within the time frames prescribed in the policy. A mechanism is in place whereby any employee of the Company has access to the Chairman of the Audit Committee to report any concern. No person has been denied access to the Chairman to report any concern. Further, the said policy has been disseminated within the organisation and has also been posted on the Companyâs website.

20. DISCLOSURES AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace.

During the financial year 2016-17, the Company had received seven complaints on sexual harassment, all were disposed-off with appropriate action taken and no complaint remain pending as of 31^st March 2017.

21. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12)

OF SECTION 143 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

22. CORPORATE GOVERNANCE

As per SEBI Listing Regulations, a Management Discussion and Analysis, Corporate Governance Report and Auditorsâ Certificate regarding compliance of conditions of Corporate Governance forms part of the Annual Report.

23. BUSINESS RESPONSIBILITY REPORTING

As per SEBI Listing Regulations, a Business Responsibility Report is attached and forms part of this Annual Report.

24. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. T.K. Balaji, Ms. Vinita Bali, Mrs. Hema Ravichandar, Prof. Das Narayandas, Mrs. Ireena Vittal and Mr. Ashwani Puri are the Independent Directors and all have given declarations that they continue to meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 25 of the Listing Regulations.

In accordance with the provisions of the Act and in terms of the Memorandum and Articles of Association of the Company, Mr. Harish Bhat retires by rotation at the Annual General Meeting and is eligible for reelection.

Mr. Atulya Misra was appointed as an Additional Director on the Board of the Company on 31^st March 2017. Memberâs attention is drawn to Item No. 5 of the Notice for the appointment of Mr. Atulya Misra as a Director of the Company.

None of the Directors is related to each other within the meaning of the term ârelativeâ as per Section 2(77) of the Act.

Six meetings of the Board were held during the year.

For details of the meetings of the Board, reference may be made to the Corporate Governance Report, which forms part of the Annual Report.

25. DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNED DURING THE YEAR

Pursuant to Section 134 of the Act read with Rule 8(5) (iii) of Companies (Accounts) Rules, 2014, the following Directors were appointed, resigned or retired:

- Mr. Ashwani Puri was appointed effective 6^th May 2016;

- Dr. C.G. Krishnadas Nair retired effective 17^th August 2016;

- Mr. C.V Sankar resigned effective 20^th August 2016;

- Mr. K. Gnanadesikan was appointed on 27^th June

2016 & resigned effective 17^th September 2016;

- Mr. Vikram Kapur was appointed on 18^th October 2016 and resigned effective 31^st March 2017.

Mr. Atulya Misra was appointed effective 31^st March 2017.

None of the Key Managerial Personnel were appointed or resigned during the year. Pursuant to the provisions of Section 203 of the Act, Mr. Bhaskar Bhat-Managing Director, Mr. S. Subramaniam-Chief Financial Officer and Mr. A.R. Rajaram-Vice President - Legal & Company Secretary continue to be the Key Managerial Personnel of the Company.

26. DIRECTORSâ RESPONSIBILITY STATEMENT

Based on the framework of Internal Financial Controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Companyâs internal financial controls are adequate and operating effectively.

Accordingly, pursuant to the requirements of Section 134 (5) of the Act, the Directors hereby confirm that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

iv. they have prepared the annual accounts on a going concern basis;

v. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively;

vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

27. BOARD EVALUATION

Based on the questionnaire and feedback, the performance of every Director was evaluated by the BNRC.

Some of the key criteria for performance evaluation, as laid down by the BNRC were as follows-

Performance evaluation of Directors:

- Contribution at Board / Committee meetings

- Guidance / Support to Management outside Board / Committee Meetings

Performance evaluation of Board and Committees:

- Board structure and composition

- Degree of fulfillment of key responsibilities

- Establishment and delineation of responsibilities to Committees

- Effectiveness of Board Processes, Information and Functioning

- Board Culture and Dynamics

- Quality of relationship between the Board and Management

- Efficacy of communication with External Stakeholders

- Committees - strengths and areas of improvement

28. INDEPENDENT DIRECTORS

29. REMUNERATION POLICY

30. POLICY ON DIRECTORSâ APPOINTMENT AND REMUNERATION AND OTHER DETAILS

In accordance with the agreement between the promoters, three Directors each may be nominated by Tata Sons Limited and Tamilnadu Industrial Development Corporation Limited.

The guidelines for selection of Independent Directors are as set out below:

The Board Nomination and Remuneration (âCommitteeâ) oversees the Companyâs nomination process for Independent Directors and in that connection to identify, screen and review individuals qualified to serve as an Independent Director on the Board.

Process for selection

Attributes

Besides these, the candidate should have an understanding of governance concepts and legal duties of a Director.

iii) It is desirable that the candidate should have expertise to fill in the gap(s) identified by the Company in the current composition of the Board.

iv) Ideally the candidate should possess experience of 5 years on the Board of a listed company.

v) The candidateâs age shall not exceed 70 years at the time of joining the Board.

vi) Forthrightness and ability to possess foresight abilities in the Governance of a Corporate.

Board Composition

Keeping in mind that women constitute a majority of the Companyâs customers it would be desirable to have one-third of the Boardâs strength represented by woman members.

Procedure

1. The Committee may retain search firms or advisors as it deems appropriate to identify candidates.

3. The Committee may also consider profiles of suitable expatriates.

4. The candidate considered by the Committee as potentially qualified will be contacted to determine their interest in being considered to serve on the Board and if interested will be interviewed.

As and when a candidate is shortlisted, the Committee will make a formal recommendation to the Board.

32. OTHER DISCLOSURES

The information required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and

Remuneration of Managerial Personnel) Rules, 2014 are given below:

i) The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year:

Sl. No.	Name of the director	Commission (Rs.)	Sitting fee (Rs.)	Total (Rs.)	Ratio (times)
A]	Median Employee remuneration			578,000
B]	Directorâs remuneration
1	Chairman (nominated by TIDCo)	5,313,700#	180,000	5,493,700	9.50
2	Mr. T. K. arun	3,719,500	405,000	4,124,500	7.13
3	Mr. N. N. Tata	3,135,000	255,000	3,390,000	5.86
4	Mr. Harish Bhat	-	375,000	375,000	0.64
5	Mr. T. K. Balaji	4,091,500	360,000	4,451,500	7.70
6	dr. C. G. Krishnadas Nair	3,285,200	210,000	3,495,200	6.04
7	Ms. Vinita Bali	3,507,000	270,000	3,777,000	6.53
8	Mrs. Ireena Vittal	4,091,500	330,000	4,421,500	7.64
9	Mrs. Hema Ravichandar	4,321,800	375,000	4,696,800	8.12
10	prof. das Narayandas	1,275,200	60,000	1,335,200	2.31
11	Mr. ashwani puri	3,338,900	255,000	3,593,900	6.21
12	Mr. Bhaskar Bhat¹	34,944,000	-	58,126,554*	100.56

#Commission to the Chairman of the Company (the Chairmanship was held by Mr. C.V. Sankar, Mr. K. Gnanadesikan, Mr. Vikram Kapur at various points in time during the year and currently Mr. Atulya Misra is the Chairman.)

* Inclusive of salary, perquisites, Commission and retiral benefits.

ii) The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:

Name	% Change
Chairman (nominated by TIDCO)	10.01
Mr. T.K. Arun	24.90
Mr. N.N. Tata	40.31
Dr. C.G. Krishnadas Nair (upto 17^th august 2016)	NA
Mr. T.K. Balaji	16.26
Ms. Vinita Bali	10.41
Mrs. Hema Ravichandar	25.39
prof. das Narayandas	1.49
Mrs. Ireena Vittal	27.02
Mr. ashwani puri	NA
Mr. Bhaskar Bhat	22.14
Mr. s.subramaniam	16.00
Mr. A.R. rajaram	12.44

iii) The percentage increase in the median remuneration of employees in the financial year: 7%

iv) The number of permanent employees on the rolls of company : 7437.

The Company has implemented differentiated increase percentages across levels. The average increases being 8% for L1-L4, 7% for L5 - L7 and 6% for L8-L9 levels. This has been done to ensure a slightly higher increment for the front line sales staff and employees at L1 to L4 category. A 4% increment was applied at the same rate for all the members of the Senior Management Team.

vi) Affirmation that the remuneration is as per the Remuneration Policy of the Company:

33. INFORMATION AS PER RULE 5(2) OF THE CHAPTER XIII, THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014

34. AUDITORS

a) Statutory Auditors

Pursuant to the provisions of Section 139 of the Act read with applicable Rules framed thereunder, M/s. Deloitte Haskins & Sells, the present Auditors of the Company complete their term as Auditors.

In view of the above, M/s. BSR & Co., LLP, Chartered Accountants having Registration No. 101248W/W-100022 is proposed to be appointed for a term of five years commencing from the Companyâs financial year 2017-18 to hold office from the conclusion of the 33^rd Annual General Meeting of the Company till the conclusion of the 38^th Annual General Meeting to be held in the financial year 2021-22 (subject to ratification of their appointment by the Members at every intervening Annual General Meeting held after this Annual General Meeting) on such remuneration and out of pocket expenses as may be decided by the Board of Directors. The Auditors have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed there under for appointment as Auditors of the Company. As required under Regulation 33 of the Listing Regulations, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

b) Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Ms. BMP & Co., LLP a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is annexed herewith as (Annexure-V).

35. AUDITORâS REPORT AND SECRETARIAL AUDITORâS REPORT

There are no disqualifications, reservations, adverse remarks or disclaimers in the auditorâs report and secretarial auditorâs report.

Acknowledgements

On behalf of the Board of Directors,

Atulya Misra

12^th May 2017 Chairman

Mar 31, 2016

The Directors are pleased to present the Thirty Second Annual Report and the Audited Statement of Accounts for the year ended 31st March 2016:

FINANCIAL RESULTS

Rs. in crores

Standalone Consolidated

2015-2016 2014-2015 2015-2016 2014-2015

Sales Income 11,295.74 11,936.71 11,312.07 11,949.33

Other Income 64.36 70.58 64.95 70.75

Total Income 11,360.10 12,007.29 11,377.02 12,020.08

Less: Excise Duty 31.21 33.50 34.13 35.92

Net Income 11,328.89 11,973.79 11,342.89 11,984.16

Expenditure 10,319.04 10,749.85 10,346.58 10,765.01

Gross profit 1,009.85 1,223.94 996.31 1,219.15

Finance Costs 42.28 80.66 42.29 80.69

Cash operating profit 967.57 1,143.28 954.02 1,138.46

Depreciation / Amortisation 96.91 87.39 99.56 89.57

Profit before taxes 870.66 1,055.89 854.46 1,048.89

Income taxes - Current 169.07 241.00 169.07 241.00

- Deferred (4.26) (8.18) (4.17) (8.36)

Profit after taxes for the year 705.85 823.07 689.56 816.25

Share of profit/(Loss) of associate - - (0.17) 0.01

Net Profit 705.85 823.07 689.39 816.26

Profit brought forward 1,042.52 934.56 1,033.91 932.76

Appropriations

Interim dividend 195.31 - 195.31 -

Proposed dividend on equity shares - 204.19 - 204.19

Tax on dividends 39.76 41.57 39.76 41.57

Transfer to general reserve 521.26 469.35 521.26 469.35

Balance carried forward 992.04 1,042.52 966.97 1,033.91

During the year under review, the Company''s sales income declined by 5.4 % to Rs. 11,295.74 crores compared with Rs. 11,936.71 crores in the previous year. Profit before tax declined by 17.5 % to Rs. 870.66 crores and the net profit declined by 14.2% to Rs. 705.85 crores. This performance came in the backdrop of an environment where the consumer sentiment did not pick up as expected and regulatory measures adversely affected the jewellery business.

The Watches business of the Company recorded an income of Rs. 1,953.55 crores, a growth of 1.7%, which was achieved through meticulous planning and execution of key initiatives. The income from Jewellery segment declined by 7.6% touching Rs. 8,717.40 crores. The income from Eyewear segment grew by 11.8% touching Rs. 371.58 crores. The income from other segments comprising Precision Engineering, a B2B Business, and accessories recorded a sale of Rs. 235.17 crores, a growth of 1.3%.

The year witnessed aggressive expansion of the Company''s retail network with a net addition of 82 stores. As on 31st March 2016, the Company had 1,283 stores, with over 1.7 million square feet of retail space delivering a retail turnover of Rs. 11,295 crores.

The Management Discussion and Analysis report, which is attached, dwells into the performance of each of the business division and the outlook for the current year.

International Operations

The Watches exports registered a handsome growth of 17% to clock a turnover of Rs. 161 crores despite several challenges in Middle East, which remained volatile and South East, which had economic and currency fluctuations. The business sustained its targeted investments in retail and brand building in key, large markets. Vietnam, UAE and Malaysia have seen brand scores enhanced along with business growth. There was visible shift to digital, new age media, e-commerce along with greater thrust on Fastrack and Sonata. Indonesia, Nigeria, Philippines and SAARC markets have shown promising results.

Dividend

The Directors at the meeting held on March 16, 2016 declared an interim dividend of Rs. 2.20 per share (220%) involving a total payment of Rs. 235.07 crores (including dividend distribution tax) for the year ended March 31, 2016. The said interim dividend was paid to the shareholders on March 29, 2016. The Directors do not recommend any further dividend for the year 2015-16.

Transfer to General Reserve

An amount of Rs. 521.26 crores is proposed to be transferred to the general reserve.

Finance

At the projected rate of 7% GDP growth, below earlier projections, the current fiscal has been a challenge. After two consecutive years of drought, with the expectation of a good monsoon this year, rural demand is expected to pick up in the second half. The PAN card rule has caused considerable dampening of sentiment in consumers and uncertainty in retailers. The Company plans to invest disproportionately in the digital space and contain its employee cost.

Public Deposits

The Jewellery Division of the Company was successfully operating customer schemes for jewellery purchases for many years. When the Companies Act, 2013 became substantially effective from 1st April 2014, the Company had around seven lakhs subscribers contributing to these schemes. However, these schemes were exempt under the Companies Act, 1956 relating to acceptance of public deposits as such schemes were not covered in the definition of deposits. Under the Companies Act, 2013 (the "Act") and Regulations made there under (''Deposit Regulations'') the scope of the term "deposit" was enlarged and therefore a view was taken that the jewellery purchase schemes offered by the Company to its customers would be treated as public deposits. Thereupon, the Company discontinued fresh enrolment of subscribers and initiated steps to close the erstwhile customer schemes, which were wound down by 31st August 2014.

Under the Deposit Regulations, a company is permitted to accept deposits subject to applicable provisions, to the extent of 25% of the aggregate paid-up share capital and free reserves from public and 10% of the aggregate paid-up share capital and free reserves from Members of the company, after prior approval by way of a special resolution passed by the Members in this behalf. In pursuance thereof, a Postal Ballot was conducted during August/September 2014 and requisite approval was obtained from the Members of the Company and a new customer scheme for jewellery purchase was launched in November 2014 in compliance with the Deposit Regulations.

The details relating to deposits, covered under Chapter V of the Companies Act, 2013 are as under:

(a) accepted during the year: Rs. 775.82 crores

(b) remained unpaid or unclaimed as at the end of the year: Rs. 20.10 crores

(c) whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved- (i) at the beginning of the year: Nil

(ii) maximum during the year: Nil

(iii) at the end of the year: Nil

There are no deposits that have been accepted by the Company that are not in compliance with the requirements of Chapter V of the Act.

Material changes and commitments affecting financial position between end of the financial year and date of report

There have been no material changes and commitments affecting financial position between end of the financial year and the date of the report.

Significant and material orders

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations in future.

Particulars of loans, guarantees and investments

The particulars of loans, guarantees and investments have been disclosed in the financial statements. There have been no investments made or guarantees given under Section 186 of the Companies Act, 2013 during the year under review. The particulars of loans given as part of treasury operations of the Company bearing interest ranging from 10.4% to 11.3% p.a. are furnished below:

Rs.

Information under Section 186(4) of the Companies Act, 2013

Opening balance Additional ICD Amount Closing balance as on 1st April during the year Matured and as on 31st March 2015 paid 2016

Loans given in the form of un secured short term Inter- 2,380,000,000 - 380,000,000 2,000,000,000

Corporate Deposits

Contribution to Exchequer

During the year under review, the Company made payments aggregating Rs. 931.20 crores by way of taxes (central, state and local) and duties as against Rs. 939.03 crores in the previous year.

Adequacy of internal controls and compliance with laws

The Company during the year has reviewed its Internal Financial Control systems and has continually contributed to establishment of more robust and effective IFC framework, prescribed under the ambit of Section 134(5) of Companies Act, 2013. The preparation and presentation of the financial statements is pursuant to the control criteria defined considering the essential components of Internal control - as stated in the "Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI)".

The control criteria ensures the orderly and efficient conduct of the Company''s business, including adherence to its policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

Based on the assessment carried out by the Management and the evaluation of the results of the assessment, the Board of Directors are of the opinion that the Company has adequate Internal Financial Controls system that is operating effectively as at March 31, 2016.

There were no instances of fraud which necessitates reporting of material misstatement to the Company''s operations.

There have been no communication from regulatory agencies concerning non-compliance with or deficiencies in financial reporting practices.

Risk Management

Pursuant to the requirement of Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "Listing Regulations"), the Company has constituted a Risk Management Committee.

The Company has in place a Risk Management framework to identify, evaluate business risks and challenges across the Company both at corporate level as also separately for each business division.

The top tier of risks for the Company is captured by the operating management after extensive deliberations on the nature of the risk being a gross or a net risk and thereafter in a prioritized manner presented to the Board for their inputs on risk mitigation/ management efforts. Based on this framework, a Risk Management policy is being developed.

The Board engages in the Risk Management process and has set out a review process so as to report to the Board the progress on the initiatives for the major risks of each of the businesses that the Company is into.

The Risk Register of each Business gets updated on an annual basis and is placed for due discussions at Board meetings and appropriateness of the mitigation measures to ensure that the risks remain relevant at any point in time and corresponding mitigation measures are optimized.

The Board Audit Committee (BAC) has been engaged in reviewing the IT initiatives and governance mechanisms pertaining to information security. The BAC also reviewed the new IT controls incorporated to comply with IFC requirements mandated by the Companies Act, 2013.

Related Party Transactions

There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interests of the Company at large. All related party transactions are placed before the Audit Committee and the Board for approval, if applicable. Prior omnibus approval of the Audit Committee is obtained for the transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are verified by the Internal Auditor and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval, if applicable on a quarterly basis. The Company has developed an Internal Guide on Related Party Transactions Manual and prescribed Standard Operating Procedures for purpose of identification and monitoring of such transactions. The Policy on Related Party Transactions as approved by the Board is uploaded on the Company''s website. None of the Directors has any pecuniary relationships or transactions vis-Ã -vis the Company. There were no transactions during the year which would require to be reported in Form AOC-2.

Subsidiaries / Joint Venture / Associate Company

As on 31st March 2016, the Company had the following subsidiaries:

1) Titan TimeProducts Limited, Goa (TTPL)

2) Favre Leuba AG, Switzerland

3) Titan Watch Company Limited, Hong Kong and

4) Titan Engineering and Automation Limited

During the year 2015-2016, TTPL sold a total of 59,68,000 nos. of ECBs and micro assemblies (previous year: 59,81,400 nos.). Net sales income during the year was Rs. 25.60 crores against the previous year''s figure of Rs. 24.46 crores. The quality, delivery and competitive price of the products continue to be well-received by the Holding Company and external customers.

As at 31st March 2016, Favre Leuba AG had registered a loss of CHF 1.88 million, i.e. Rs. 13.00 crores (2014-15: CHF 0.92 million i.e. Rs. 5.89 crores) which apart from amortization of trademarks design and development expenses, includes operating expenses incurred in preparation of product launches scheduled to commence from October 2016.

Titan Watch Company Limited is a subsidiary of the Company''s subsidiary Favre Leuba AG and hence is a subsidiary of the Company. It has a capital of HK $ 10,000 and no Profit and Loss account has been prepared as it has not yet commenced business.

Titan Engineering and Automation Limited (TEAL) was incorporated on 24th March 2015 to acquire the Precision Engineering Business of the Company through a court approved scheme of arrangement.

The annual accounts of these subsidiary companies were consolidated with the accounts of Titan Company Limited for 2015-16. None of these companies declared a dividend in 2015-16.

The Company holds a 49% equity stake in a joint venture entered into with Montblanc Services B.V., the Netherlands for operation of retail boutiques in India for Montblanc products.

The Company holds 26.79% stake in Green Infra Wind Power Theni Limited which supplies energy to the Company.

The statement containing salient features of the financial statement of subsidiaries/associate company/joint venture forms part of the Annual Report.

Consolidated Financial Statements

The Consolidated Financial Statements of the Company prepared as per Accounting Standard AS 21, Accounting Standard AS 23 and Accounting Standard AS 27 consolidating the Company''s accounts with its subsidiaries, a joint venture and an associate have also been included as part of this Annual Report.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

The particulars as prescribed under sub-section (3) (m) of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, are furnished in Annexure- I to the Board''s Report.

Corporate Social Responsibility

A report on CSR is attached in Annexure II.

Extract of Annual Return

As provided under Section 92(3) of the Act, the extract of annual return is given in Annexure-III in the prescribed Form MGT-9, which forms part of this Report.

Vigil Mechanism

The Company has a whistle blower mechanism wherein the employees can approach the Management of the Company (Audit Committee in case where the concern involves the Senior Management) and make protective disclosures to the Management about unethical behaviour, actual or suspected fraud or violation of the Company''s Code of Conduct. The Whistle Blower Policy requires every employee to promptly report to the Management any actual or possible violation of the Code or an event he becomes aware of that could affect the business or reputation of the Company. The disclosures reported are addressed in the manner and within the time frames prescribed in the policy. A mechanism is in place whereby any employee of the Company has access to the Chairman of the Audit Committee to report any concern. No person has been denied access to the Chairman to report any concern. Further, the said policy has been disseminated within the organisation and has also been posted on the Company''s website.

Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace.

During the financial year 2015-16, the Company had received eight complaints on sexual harassment, which were disposed-off with appropriate action taken and nil complaints remain pending as of 31st March 2016.

Details in respect of Frauds reported by Auditors under sub-section (12) of Section 143 other than those which are reportable to the Central Government

The Statutory Auditors of the Company have not reported any fraud as specified under the second proviso of Section 143(12) of the Companies Act, 2013 (including any statutory modification(s) or re- enactment(s) for the time being in force).

Corporate Governance

Pursuant to Regulation 34 of the Listing Regulations executed with the Stock Exchanges, a Management Discussion and Analysis, Corporate Governance Report and Auditors'' Certificate regarding compliance of conditions of Corporate Governance forms part of the Annual Report.

Business Responsibility Reporting

As per Regulation 34 of the Listing Regulations with the Stock Exchanges, a Business Responsibility Report is attached and forms part of this Annual Report.

Directors and Key Managerial Personnel

Mr. T.K. Balaji, Dr. C.G. Krishnadas Nair, Ms. Vinita Bali, Mrs. Hema Ravichandar, Prof. Das Narayandas and Mrs. Ireena Vittal are the Independent directors and all have given declarations that they continue to meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 25 of the Listing Regulations. In accordance with his appointment resolution, term of directorship of Dr. C.G. Krishnadas Nair ends on 16th August 2016. The Board places on record its appreciation to Dr. Nair for the valuable contribution and wise counsel rendered by him during his tenure as a Director of the Company.

In accordance with the provisions of the Act and in terms of the Memorandum and Articles of Association of the Company, Mr. C.V. Sankar retires by rotation at the Annual General Meeting.

Mr. Ashwani Puri, Independent Director was appointed as an Additional Director on the Board of the Company on 6th May 2016. Member''s attention is drown to Item No. 8 of the Notice for the appointment of Mr. Ashwani Puri as a Director of the Company.

None of the Directors are related to each other within the meaning of the term "relative" as per Section 2(77) of the Act.

Five meetings of the Board were held during the year. For details of the meetings of the Board, reference may be made to the Corporate Governance Report, which forms part of the Annual Report.

Details of Directors and Key Managerial Personnel who were appointed or have resigned during the year

Pursuant to Section 134 of Companies Act, 2013 read with Rule 8(5) (iii) of Companies (Accounts) Rules, 2014, no Directors or Key Managerial Personnel were appointed or resigned. Pursuant to the provisions of Section 203 of the Act, Mr. Bhaskar Bhat-Managing Director, Mr. S. Subramaniam-Chief Financial Officer and Mr. A.R. Rajaram-Head Legal & Company Secretary continue to be the Key Managerial Personnel of the Company.

Directors'' Responsibility Statement

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company''s internal financial controls are adequate and operating effectively.

Accordingly, pursuant to the requirements of Section 134 (5) of the Act, the Directors hereby confirm that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

ii. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. they have prepared the annual accounts on a going concern basis;

v. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively;

vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively

Board Evaluation

The performance evaluation of the Board, its Committees and ndividual Directors was conducted and the same was based on questionnaire and feedback from all the Directors on the Board as a whole, its Committees and self-evaluation

The Chairperson of the Board Nomination and Remuneration Committee (BNRC) held separate discussions with each of the Directors of the Company and obtained their feedback on overal Board effectiveness as well as on each of the other Directors.

Based on the questionnaire and feedback, the performance of every Director was evaluated by the BNRC

Some of the key criteria for performance evaluation, as laid down by the BNRC were as follows-

Performance evaluation of Directors:

- Contribution at Board / Committee meetings

- Guidance / Support to Management outside Board / Committee Meetings

Performance evaluation of Board and Committees:

- Board structure and composition

- Degree of fulfillment of key responsibilities

- Establishment and delineation of responsibilities to Committees

- Effectiveness of Board Processes, Information and Functioning

- Board Culture and Dynamics

- Quality of relationship between the Board and Management

- Efficacy of communication with External Stakeholders

- Committees - strengths and areas of improvement

Independent Directors

A separate meeting of the independent directors ("Annual ID Meeting") was convened, which reviewed the performance of the Board (as a whole), the non-independent directors and the Chairman. Post the Annual ID Meeting, the collective feedback of each of the Independent Directors was discussed by the Chairperson of the BNRC with the Board covering performance of the Board as a whole, performance of the non-independent directors and performance of the Board Chairman

Remuneration Policy

The Board has, on the recommendation of the BNRC framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report.

Policy on Directors'' appointment and remuneration and other details

In accordance with the agreement between the promoters, three Directors each may be nominated by Tata Sons Limited and Tamilnadu Industrial Development Corporation Limited.

The guidelines for selection of Independent Directors are as set out below:

The Board Nomination and Remuneration Committee oversees the Company''s nomination process for Independent Directors and in that connection to identify, screen and review individuals qualified to serve as an Independent Director on the Board.

Process for selection

The Committee may act on its own in identifying potential candidates. The Committee shall review and discuss details pertaining to candidates and will conduct evaluation of candidates in accordance with the process that it sees fit and appropriate and thereafter pass on its recommendation for nomination to the Board, based on the following guidelines:

Attributes

i) The Committee shall seek candidates who is not a nominee or related to either Promoter of the Company. Such candidates shall possess integrity, leadership skills, managerial qualities, foresight abilities and competency required to direct and oversee the Company''s management in the best interest of its stakeholders i.e. shareholders, customers, employees and communities it serves.

ii) The candidate must be willing to regularly attend the meetings of the Board and develop a strong understanding of the Company, it''s businesses and it''s needs, to contribute his/ her time and knowledge to the Company and to be prepared to exercise his/her duties with skill and care. Besides these, the candidate should have an understanding of governance concepts and legal duties of a Director.

iii) It is desirable that the candidate should have expertise to fill in the gap(s) identified by the Company in the current composition of the Board.

iv) Ideally the candidate should possess experience of 5 years on the Board of a listed company.

v) The candidate''s age shall not exceed 70 years at the time of joining the Board.

vi) Forthrightness and ability to possess foresight abilities in the Governance of a Corporate.

Board Composition

Keeping in mind that women constitute a majority of the Company''s customers it would be desirable to have one-third of the Board''s strength represented by woman members.

Procedure

1. The Committee may retain search firms or advisors as it deems appropriate to identify candidates.

2. Develop a list of potential candidates of Independent Directors which may be refreshed every year. The Committee to create a list of probable candidates from known sources or from the database of Ministry of Corporate Affairs, Government of India or Stock Exchanges.

3. The Committee may also consider profiles of suitable expatriates.

4. The candidate considered by the Committee as potentially qualified will be contacted to determine their interest in being considered to serve on the Board and if interested will be interviewed.

As and when a candidate is shortlisted, the Committee will make a formal recommendation to the Board.

Other Disclosures

The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

i) The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year:

Sl. No. Name of the Director Commission (Rs.) Sitting fee (Rs.) Total (Rs.) Ratio (times)

A] Median Employee remuneration 5,50,000

B] Directors remuneration

1 Mr. C.V. Sankar 47,13,500 2,80,000 49,93,500 9.07

2 Mr. T. K. Arun 29,99,500 3,02,500 33,02,000 6.00

3 Mr. Harish Bhat - 2,45,000 2,45,000 0.45

4 Mr. N. N. Tata 22,71,050 1,45,000 24,16,050 4.39

5 Mr. T. K. Balaji 35,13,700 3,15,000 38,28,700 6.96

6 Dr. C. G. Krishnadas Nair 41,13,600 3,97,500 45,11,100 8.20

7 Ms. Vinita Bali 31,70,900 2,50,000 34,20,900 6.22

8 Mrs. Ireena Vittal 31,70,900 3,10,000 34,80,900 6.32

9 Mrs. Hema Ravichandar 34,28,000 3,17,500 37,45,500 6.81

10 Prof. Das Narayandas 12,85,500 30,000 13,15,500 2.39

11 Mr. Bhaskar Bhat 2,50,00,000 - 4,75,89,556* 86.53

*Inclusive of salary, perquisites, commission and retiral benefits.

i) The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:-

Name % Change

Mr. C. V. Sankar 50.32

Mr. T. K. Arun -46.15

Mr. Harish Bhat NA

Mr. N. N. Tata 158.51

Mr. T. K. Balaji 84.15

Dr. C. G. Krishnadas Nair -17.04

Ms. Vinita Bali -11.45

Mrs. Hema Ravichandar -4.04

Prof. Das Narayandas -29.43

Mrs. Ireena Vittal -25.43

Mr. Bhaskar Bhat -3.12

Mr. S. Subramaniam 13.54

Mr. A. R. Rajaram 11.31

iii) The percentage increase in the median remuneration of employees in the financial year - 6.6%

iv) The number of regular employees on the rolls of company - 7859

v) The explanation on the relationship between average increase in remuneration and company performance -

The average increase in the remuneration of the employees of the organisation takes into account the Company performance, inflation rate, market salary increase and trends as projected by consulting firms

vi) Comparison of the remuneration of the Key Managerial Personnel against the performance of the company;

(Rs. in crores)

Particulars Mr. Bhaskar Bhat, Mr. S. Subramaniam, Mr. A. R. Rajaram, Managing Director Chief Financial Officer Head - Legal & Company Secretary

Remuneration in FY 2016 4.76 2.25 1.08

Revenue 11,264.53 11,264.53 11,264.53

Remuneration as a % of revenue 0.042% 0.019% 0.009%

Profit before Tax (PBT) 870.66 870.66 870.66

Remuneration (as % of PBT) 0.55% 0.26% 0.12%

vii) Variations in the market capitalisation of the Company, price earnings ratio as at the closing date of the current financial year and previous financial year.

Particulars 2015-16 2014-15 % Change

Market Capitalisation (Rs. crores) 30,104.83 34,765.71 -13.41

Price Earnings Ratio 42.61 42.24 0.88

viii) Percentage increase over decrease in the market quotations of the shares of the company in comparison to the rate at which the company came out with the last public offer in case of listed companies, and in case of unlisted companies, the variations in the net worth of the company as at the close of the current financial year and previous financial year.

Particulars 31st March 2016 1987-88 IPO % Change*

Market Price (NSE) in Rs. 339.10 10.00 67720

Market Price (BSE) in Rs. 338.80 10.00 67660

*Adjusted for Bonus and Split in 2011

ix) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

No such differentiation was followed in giving the increment during the last financial year. The average increment in salary was basis individual performance.

x) The key parameters for any variable component of remuneration availed by the directors

The Members had, at the AGM of the Company held on 31st July 2015 approved payment of Commission to the non- executive directors within the ceiling of 1% of the net profits of the Company as computed under the applicable provisions of the Act. The said Commission is decided each year by the Board of Directors and distributed amongst the non-executive directors based on performance evaluation, attendance and contribution at the meetings of the Board and its Committees, as well as the time spent on operational matters other than at meetings.

xi) The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year:

The highest paid Director is the Managing Director. No employee has received remuneration in excess of the Managing Director during the year.

xii) Affirmation that the remuneration is as per the Remuneration Policy of the Company.

The Company''s Remuneration Policy is based on the principle of internal equity, competence and experience of the employee and industry standards. Through its compensation programme, the Company endeavours to attract, retain, develop and motivate a high performance workforce and engaged workforce. The Company follows a compensation mix of fixed pay, benefits and performance based variable pay. Individual performance pay is determined by business performance and the performance of the individuals measured through the annual appraisal process. The Company affirms remuneration is as per the Remuneration Policy of the Company.

Information as per Rule 5(2) of the Chapter XIII, the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

Details of employee remuneration as required under provisions of Section 197 of the Companies Act, 2013 and Rule 5(2) & 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 will be available at the Registered Office of the Company during working hours for a period of 21 days before the date of the Annual General Meeting. Any member interested in obtaining such particulars may write to the Company Secretary or through mail addressed to [email protected].

AUDITORS

Statutory Auditors

The Members are requested to ratify the appointment of its Statutory Auditors, Messrs Deloitte Haskins & Sells, Chartered Accountants (Firm''s Registration No. 008072S), from the conclusion of this Thirty Second Annual General Meeting upto the conclusion of the Thirty Third Annual General Meeting. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed there under for re-appointment as Auditors of the Company. As required under Regulation 33 of the Listing Regulations, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its PED activity may require to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed M/s. M.R. Rajashekar & Co. to audit the cost accounts of the Company for the financial year 2015-

16. As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a Resolution seeking Member''s ratification for the remuneration payable to M/s. M.R. Rajashekar & Co., Cost Auditors is included at Item No. 6 of the Notice convening the Annual General Meeting.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Messrs HBP & Co, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed herewith as (Annexure-IV).

Auditor''s Report and Secretarial Auditor''s Report

There are no disqualifications, reservations, adverse remarks or disclaimers in the auditor''s report and secretarial auditor''s report.

Acknowledgements

Your Directors wish to place on record their appreciation of the support which the Company has received from its promoters, shareholders, lenders, business associates, vendors, customers, media and the employees of the Company.

On behalf of the Board of Directors,

C.V. Sankar

6th May 2016 Chairman

Mar 31, 2015

To the Members of Titan Company Limited

The Directors are pleased to present the Thirty First Annual Report and the Audited Statement of Accounts for the year ended 31st March 2015:

Financial Results

Rs. in crores

2014-2015 2013-2014

Sales Income 11,936.71 10,955.14

Other Income 70.58 120.19

Total Income 12,007.29 11,075.33

Less: Excise Duty 33.50 39.35

Net Income 11,973.79 11,035.98

Expenditure 10,749.85 9,867.35

Gross profit 1,223.94 1,168.63

Finance Costs 80.66 87.11

Cash operating profit 1,143.28 1,081.52

Depreciation / Amortisation 87.39 65.59

Profit before taxes 1,055.89 1,015.93

Income taxes - Current 241.00 263.00

- Deferred (8.18) (1.31)

Profit after taxes for the year 823.07 754.24

Less: Income tax of earlier years - 13.10

Net Profit 823.07 741.14

Profit brought forward 934.56* 831.39

Appropriations

Proposed dividend on equity shares 204.19 186.44

Tax on dividends 41.57 31.68

Transfer to general reserve 469.35 415.70

Balance carried forward 1,042.52 938.71

*after adjusting depreciation on transition to Schedule II of the Companies Act, 2013 on tangible fixed assets with NIL remaining useful life (net of deferred tax).

The economic outlook for the year 2014-15 was promising while improvement in consumer demand was quite lukewarm. The Company''s jewellery business was also impacted due to regulatory changes and termination of the consumer friendly Golden Harvest Scheme. The Company''s brands witnessed good growth during the first half, while in the later half it witnessed a decline due to the absence of the Golden Harvest Scheme which used to contribute about 30% of the Jewellery Division''s revenues. The Company will however continue to invest in strategic initiatives taking into account its long term and sustainable growth plans.

During the year under review, the Company''s sales income grew by 8.96% to Rs. 11,936.71 crores compared with Rs. 10,955.14 crores in the previous year. Profit before tax grew by 3.93 % to Rs. 1,055.89 crores and the net profit grew by 11.05% to Rs. 823.07 crores. This performance came in the backdrop of an environment where the consumer sentiment did not pick up as expected. The strength of Company''s brands contributed to sales growth across all retail formats of watches, jewellery and eyewear.

The Watches business of the Company recorded an income of Rs. 1,921.04 crores, a growth of 7.27%, which was achieved through meticulous planning and execution of key initiatives. The income from Jewellery segment grew by 9.24% touching Rs. 9,429.97 crores. The income from other segments comprising Precision Engineering, a B2B Business, the Eyewear Business and accessories grew by 12.91% to Rs. 564.31 crores.

The year witnessed aggressive expansion of the Company''s retail network with a net addition of 123 stores. As on 31st March 2015, the Company had 1201 stores, with over 1.59 million square feet of retail space delivering a retail turnover of just under Rs. 12,000 crores.

The Management Discussion and Analysis report, which is attached, dwells into the performance of each of the business division and the outlook for the current year.

International Operations

The Watches exports registered a handsome growth of 12% to clock a turnover of Rs. 137.76 crores against a backdrop of several headwinds in international markets. The business sustained its targeted investments in retail and brand building in key, large markets. The presence of Titan in modern retail is adding to both image and business. Entry into In-flight sales through Singapore Airlines paves way for a new route to building the brand. Vietnam, UAE and Malaysia lead the growth stories while Indonesia, Nigeria, Philippines and SAARC markets hold promise for future.

Dividend

The Directors are pleased to recommend the payment of dividend on equity shares at the rate of 230% (Rs. 2.30 per equity share), subject to approval by the shareholders at the Annual General Meeting (AGM).

Transfer to General Reserve

An amount of Rs. 469.35 crores is proposed to be transferred to the general reserve.

Finance

The Jewellery Division of the Company was successfully operating customer schemes for jewellery purchases for many years. As on 1st April 2014, the Company had around seven lakhs subscribers contributing to these schemes. These schemes were not covered under the Companies Act, 1956 relating to acceptance of public deposits as such schemes were exempt from the definition of deposits. However, under the Companies Act, 2013 (the "Act") and Regulations made there under (''Deposit Regulations'') the scope of the term "deposit" has been enlarged and therefore a view has been taken that the jewellery purchase schemes offered by the Company to its customers will be treated as public deposits. In these circumstances, the Company discontinued fresh enrolment of subscribers and initiated steps to close the current customer schemes, which were wound down by 31st August 2014.

Under the Deposit Regulations, a company is permitted to accept deposits subject to applicable provisions, to the extent of 25% of the aggregate paid-up share capital and free reserves from public and 10% of the aggregate paid-up share capital and free reserves from Members of the company, after prior approval by way of a Special Resolution passed by the Members in this behalf. In pursuance thereof, a Postal Ballot was conducted during August/September 2014 and requisite approval was obtained from the Members of the Company and a new customer scheme for jewellery purchase was launched in November 2014 in compliance with the Deposit Regulations.

The details relating to deposits, covered under Chapter V of the Act, are as under:

(a) accepted during the year: Rs. 51,148.86 lakhs*

(b) remained unpaid or unclaimed as at the end of the year: Rs. 3.85 lakhs

(c) whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved-

(i) at the beginning of the year: No

(ii) maximum during the year: No

(iii) at the end of the year: No

*Includes an amount of Rs. 44,238 lakhs received under the old Jewellery Purchase Scheme which was outside the purview of deposits under the Companies Act, 1956

There are no deposits that have been accepted by the Company that are not in compliance with the requirements of Chapter V of the Act. Material changes and commitments affecting financial position between end of the financial year and date of report There have been no material changes and commitments affecting financial position between end of the financial year and the date of the report.

Significant and material orders

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations in future.

Particulars of loans, guarantees and investments

The particulars of loans, guarantees and investments have been disclosed in the financial statements. There have been no investments made or guarantees given under Section 186 of the Companies Act, 2013 during the year uner review. The particulars of loans given as part of treasury operations of the Company bearing interest ranging from 10.40% to 11.25% p.a. are furnished below:

Information under Section 186(4) of the Companies Act, 2013 Rs. Opening Additional ICD Amount Closing balance as on during the Matured and balance as on 1st April 2014 year paid 31st March 2015

Loans given in the form of unsecured short term Inter- 1,900,000, 000 5,060,000, 000 4,580,000, 000 2,380,000,000 Corporate Deposits

Contribution to Exchequer

During the year under review, the Company made payments aggregating Rs. 939.04 crores by way of taxes (central, state and local) and duties as against Rs. 973.78 crores in the previous year.

Adequacy of internal controls and compliance with laws

The Management of the Company has over the years set up internal control mechanisms to cater to the growing needs of the businesses. The Company has invested significantly in computerization of processes across the network and has implemented ERP systems to automate and control transactions in all its businesses. The process is a continuing one and refinements are made as and when felt required. One of the big initiatives to enhance control in retail operations in the last few years was the establishment of the Operations Control Group, reporting to the Chief Financial Officer, which conducts comprehensive periodic audit of retail operations through its team members and outsourced resources. This group also conducts investigation of frauds at store levels as and when detected. The Company has also established various back office desktop audits to detect frauds across the network, be they from employees, business associates or even customers. The Company is currently working on implementation of Internal Financial Controls as per the Committee of Sponsoring Organisation 2013 framework.

The Company has an internal audit department for reviewing the internal control systems. The department is headed by a Chartered Accountant who oversees a team comprising currently of 8 members. The Head - Internal Audit reports to the Audit Committee and issues reports on monthly and/or quarterly basis on audit plans and audit findings. Besides the internal team, the Company is also utilizing the services of an external team from a globally reputed audit firm to conduct internal audits in various areas throughout the year. The Board Audit Committee reviews the effectiveness of the internal audit function periodically at its Committee meetings. The composition of the Board Audit Committee is disclosed in the Corporate Governance Report which forms a part of the Annual Report. The internal audit function also reviews the Corporate Risk Assessment exercises and the Risk Register on a yearly basis. The Company intends to appoint a Head of Risk Management who will oversee and coordinate the Company''s risk management function.

A compliance team in the Legal & Secretarial department ensures, amongst others, that there are adequate systems and processes in the Company commensurate with the size and operations to monitor and ensure compliance with applicable laws, rules, regulations and guidelines. The Human Resources department carries out a similar exercise for ensuring compliance with all relevant labour legislations.

Based on the foregoing, the Board of Directors, after making all reasonable enquiries and to the best of its knowledge and belief, with the concurrence of the Board Audit Committee, is of the opinion that the internal controls of the Company are adequate to address the financial, operational and compliance risks of the Company.

Risk Management

Pursuant to the requirement of Clause 49 of the Listing Agreement, the Company has constituted a Risk Management Committee. The details of Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board''s Report.

The Company has in place, a Risk Management framework to identify, evaluate business risks and challenges across the Company both at corporate level as also separately for each business division.

The top tier of risks for the Company is captured by the operating management after serious deliberations on the nature of the risk being a gross or a net risk and thereafter in a prioritized manner presented to the Board for their inputs on risk mitigation/management efforts. Based on this framework, a Risk Management policy is being developed.

The Board engages in the Risk Management process and has set out a review process so as to report to the Board the progress on the initiatives for the major risks of each of the businesses that the Company is into.

The Risk Register of each Business gets updated on an annual basis and is placed for due discussions at Board meetings and appropriateness of the mitigation measures to ensure that the risks remain relevant at any point in time and corresponding mitigation measures are optimized.

Related Party Transactions

There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. All Related Party Transactions are placed before the Audit Committee as also the Board for approval. Prior omnibus approval of the Audit Committee is obtained on a quarterly basis for the transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are subject to internal audit and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval on a quarterly basis. The Company has developed an Internal Guide on Related Party Transactions Manual and prescribed, Standard Operating Procedures for purpose of identification and monitoring of such transactions. The policy on Related Party Transactions as approved by the Board is uploaded on the Company''s website. None of the Directors has any pecuniary relationships or transactions vis-Ã -vis the Company. The Form for disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub-section (1) of Section 188 of the Companies Act, 2013 in Form AOC-2 is annexed as Annexure- I.

Subsidiaries

As on 31st March 2015, the Company had the following subsidiaries:

1) Titan TimeProducts Limited, Goa

2) Favre Leuba AG, Switzerland

3) Titan Watch Company Limited, Hong Kong and

4) Titan Engineering and Automation Limited

During the year 2014-2015, TTPL sold a total of 59,81,400 nos. of ECBs and micro assemblies (previous year: 64,59,583 nos.). Net sales income during the year was Rs. 24.46 crores against the previous year''s figure of Rs. 23.11 crores. The drop in volumes is largely attributed to the decline in the off-take of watch circuit boards from Titan Company Limited (2012-13: 6.43 million nos., 2013-14: 4.85 million nos., 2014-15: 4.7 million nos.). The quality, delivery and competitive price of the products continue to be well-received by the Holding Company and external customers.

As at 31st March 2015, Favre Leuba AG had registered a loss of CHF 0.92 million, i.e. Rs. 5.89 crores (2013-14: CHF 0.61 million i.e. Rs. 3.60 crores) which primarily represents amortization of trademarks design and development expenses.

Titan Watch Company Limited, became a subsidiary of the Company''s subsidiary Favre Leuba AG during the year and hence is a subsidiary of the Company. It has a capital of HK $ 10,000 and no Profit and Loss account has been prepared as it has not yet commenced business.

Titan Engineering and Automation Limited (TEAL) was incorporated on 24th March 2015 to acquire the Precision Engineering Business Division of the Company subject to such approvals as may be statutorily applicable through a court approved scheme of arrangement. The first financial year of the Company will be upto 31st March 2016 and hence annexation of its financial statements would not arise.

The annual accounts of these subsidiary companies were consolidated with the accounts of Titan Company Ltd for 2014- 15. None of these companies declared a dividend in 2014-15.

The statement containing salient features of the financial statement of subsidiaries/associate companies/joint ventures forms part of the Annual Report.

Consolidated Financial Statements

The Consolidated Financial Statements of the Company prepared as per Accounting Standard AS 21 and Accounting Standard AS 23, consolidating the Company''s accounts with its subsidiaries and an associate have also been included as part of this Annual Report.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

The particulars as prescribed under sub-section (3) (m) of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, are furnished in Annexure-II to the Board''s Report.

Corporate Social Responsibility

The brief outline of the Corporate Social Responsibility (CSR) initiatives undertaken by the Company on CSR activities during the year are set out in Annexure-III of this Report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. The policy is available on the website of the Company.

Extract of Annual Return

As provided under Section 92(3) of the Act, the extract of annual return is given in Annexure-IV in the prescribed Form MGT-9, which forms part of this Report.

Vigil Mechanism

The Company has a whistle blower mechanism wherein the employees can approach the Management of the Company (Audit Committee in case where the concern involves the Senior Management) and make protective disclosures to the Management about unethical behaviour, actual or suspected fraud or violation of the Company''s Code of Conduct. The Whistle Blower Policy requires every employee to promptly report to the Management any actual or possible violation of the Code or an event he becomes aware of that could affect the business or reputation of the Company. The disclosures reported are addressed in the manner and within the time frames prescribed in the policy. A mechanism is in place whereby any employee of the Company has access to the Chairman of the Audit Committee to report any concern. No person has been denied access to the Chairman to report any concern. Further, the said policy has been disseminated within the organisation and has also been posted on the Company''s website.

Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace.

During the financial year 2014-15, the Company had received six complaints on sexual harassment, all were disposed-off with appropriate action taken and nil complaints remain pending as of 31st March 2015.

Corporate Governance

Pursuant to Clause 49 of the Listing Agreement executed with the Stock Exchanges, a Management Discussion and Analysis, Corporate Governance Report and Auditors'' Certificate regarding compliance of conditions of Corporate Governance forms part of the Annual Report.

Business Responsibility Reporting

As per Clause 55 of the Listing Agreement executed with the Stock Exchanges, the Company''s corporate sustainability initiatives has been hosted on the Company''s website as permitted vide circular no. CIR/CFD/DIL/8/2012 issued by the Securities and Exchange Board of India.

Directors and Key Managerial Personnel

At the Annual General Meeting of the Company held on 1st August 2014, the Company appointed Mr. T.K. Balaji, Dr. C.G. Krishnadas Nair, Ms. Vinita Bali, Mrs. Hema Ravichandar, Prof. Das Narayandas and Mrs. Ireena Vittal as the Independent Directors and all have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

In accordance with the provisions of the Act and in terms of the Memorandum and Articles of Association of the Company, Mr. N N Tata and Mr. T K Arun retire by rotation and are eligible for re-appointment.

During the year Mr. Hans Raj Varma resigned from the Board and TIDCO nominated Mr. CV Sankar as Chairman. The Board places on record its appreciation of the valuable contribution and guidance provided by Mr. Varma. Mr. Ishaat Hussain resigned from the Board on 20th March 2015 and was associated with the Company as a Board member for over twenty five years. The Board places on record its appreciation of the valuable contributions and guidance provided by him. Mr. Harish Bhat was appointed as an Additional Director with effect from 20th April 2015 and he holds office till the conclusion of the Annual General Meeting. A notice has been received from a shareholder to appoint Mr. Harish Bhat as a Director, along with the requisite deposit amount.

None of the Directors are related to each other within the meaning of the term "relative" as per Section 2(77) of the Act.

Six meetings of the Board were held during the year. For details of the meetings of the Board, please refer to the Corporate Governance Report, which forms part of the Annual Report.

Pursuant to the provisions of Section 203 of the Act, which came into effect from 1st April 2014, the appointments of Mr. Bhaskar Bhat, Managing Director, Mr. S. Subramaniam, Chief Financial Officer and Mr. A.R. Rajaram, Company Secretary as Key Managerial Personnel of the Company were formalised.

Directors'' Responsibility Statement

Based on the framework of internal financial controls and compliance systems established and maintained by the Company and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company''s internal financial controls are adequate and operating effectively.

Accordingly, pursuant to the requirements of Section 134 (5) of the Act the Directors hereby confirm that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

ii. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. they have prepared the annual accounts on a going concern basis;

v. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively;

vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Board Evaluation

The performance evaluation of the Board, its Committees and individual Directors was conducted and the same was based on questionnaire and feedback from all the Directors on the Board as a whole, its Committees and self-evaluation.

The Chairperson of the Board Nomination and Remuneration Committee (BNRC) held separate discussions with each of the Directors of the Company and obtained their feedback on overall Board effectiveness as well as on each of the other Directors.

Based on the questionnaire and feedback, the performance of every Director was evaluated in the meeting of the BNRC.

Some of the key criteria for performance evaluation, as laid down by the BNRC were as follows-

Performance evaluation of Directors:

- Contribution at Board / Committee meetings

- Guidance / Support to Management outside Board / Committee Meetings

Performance evaluation of Board and Committees:

- Board structure and composition

- Degree of fulfillment of key responsibilities

- Establishment and delineation of responsibilities to Committees

- Effectiveness of Board Processes, Information and Functioning

- Board Culture and Dynamics

- Quality of relationship between the Board and Management

- Efficacy of communication with External Stakeholders

- Committees Â strengths and areas of improvement

Independent Directors

A separate meeting of the independent directors ("Annual ID meeting") was convened, which reviewed the performance of the Board (as a whole), the non-independent directors and the Chairman. Post the Annual ID meeting, the collective feedback of each of the Independent Directors was discussed by the Chairperson of the BNRC with the Board covering performance of the Board as a whole, performance of the non-independent directors and performance of the Board Chairman.

Remuneration Policy

The Board has, on the recommendation of the BNRC framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report.

Policy on Directors'' appointment and remuneration and other details

In accordance with the agreement between the promoters, 3 Directors each may be nominated by Tata Sons Limited and Tamilnadu Industrial Development Corporation Limited. The guidelines for selection of Independent Directors is as set out below:

The Board Nomination and Remuneration Committee shall oversee the Company''s nomination process for Independent Directors and in that connection to identify, screen and review individuals qualified to serve as an Independent Director on the Board.

Process for selection

The Committee may act on its own in identifying potential candidates. The Committee shall review and discuss details pertaining to candidates and will conduct evaluation of candidates in accordance with the process that it sees fit and appropriate and thereafter pass on its recommendation for nomination to the Board, based on the following guidelines:

Attributes

i) The Committee shall seek candidates who is not a nominee or related to either Promoters of the Company. Such candidates shall possess integrity, leadership skills, managerial qualities, foresight abilities and competency required to direct and oversee the Company''s management in the best interest of its stakeholders i.e. shareholders, customers, employees and communities it serves.

ii) The candidate must be willing to regularly attend the meetings of the Board and develop a strong understanding of the Company, it''s businesses and it''s needs, to contribute his/her time and knowledge to the Company and to be prepared to exercise his/her duties with skill and care. Besides these, the candidate should have an understanding of governance concepts and legal duties of a Director.

iii) It is desirable that the candidate should have expertise to fill in the gap(s) identified by the Company in the current composition of the Board.

iv) Ideally the candidate should possess experience of 5 years on the Board of a listed company.

v) The candidate''s age shall not exceed 70 years at the time of joining the Board.

vi) Forthrightness and ability to possess foresight abilities in the Governance of a Corporate.

Board Composition

Keeping in mind that women constitute a majority of the Company''s customers it would be desirable to have one-third of the Board''s strength represented by woman members.

Procedure

1. The Committee may retain search firms or advisors as it deems appropriate to identify candidates.

2. Develop a list of potential candidates of Independent Directors which may be refreshed every year. The Committee to create a list of probable candidates from known sources or from the database of Ministry of Corporate Affairs, Government of India or Stock Exchanges.

3. The Committee may also consider profiles of suitable expatriates.

4. The candidate considered by the Committee as potentially qualified will be contacted to determine their interest in being considered to serve on the Board and if interested will be interviewed.

As and when a candidate is shortlisted, the Committee will make a formal recommendation to the Board.

Other Disclosures

The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

i) The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year:

Sl. No. Name of the director Commission (Rs.) Sitting fee (Rs.)

A] Median Employee remuneration

B] Directors remuneration

1 Mr. C.V. Sankar 32,41,900 80,000

2 Mr. Hans Raj Verma 7,09,700 60,000

3 Mr. T. K. Arun 58,54,900 2,77,500

4 Mr. Ishaat Hussain 66,12,900 2,95,000

5 Mr. N. N. Tata 8,87,100 47,500

6 Mr. T. K. Balaji 19,51,600 1,27,500

7 Dr. C. G. Krishnadas Nair 51,45,200 2,92,500

8 Ms. Vinita Bali 36,93,500 1,70,000

9 Mrs. Ireena Vittal 44,35,500 2,32,500

10 Mrs. Hema Ravichandar 36,93,500 2,10,000

11 Prof. Das Narayandas 17,74,200 90,000

12 Mr. Bhaskar Bhat 2,88,00,000 -

Name of the director Total (Rs.) Ratio (times)

Median Employee remuneration 5,16,000

Directors remuneration

Mr C V Sankar 33,22,000 6.43

Mr Hans Raj Verma 7,69,700 1.49

Mr T K Arun 61,32,400 11.88

Mr Ishaat Hussain 69,07,900 13.38

Mr N N Tata 9,34,600 1.81

Mr T K Balaji 20,79,100 4.02

Dr C G Krishnadas Nair 54,37,700 10.53

Ms Vinita Bali 38,63,500 7.48

Mrs Ireena Vittal 46,68,000 9.04

Mrs Hema Ravichandar 39,03,500 7.56

Prof.Das Narayandas 18,64,200 3.61

Mr Bhaskar Bhat 4,91,25,764* 95.20

*Inclusive of salary, perquisites, commission and retiral benefits.

ii) The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year; -

Name % Change

Mr. C.V. Sankar NA

Mr. Hans Raj Verma (Upto 16th June 2014) -83.53

Mr. T.K. Arun 34.42

Mr. Ishaat Hussain (Upto 20th March 2015) 42.86

Mr. N.N. Tata -51.56

Mr. T.K. Balaji -38.46

Dr. C.G. Krishnadas Nair -5.78

Ms. Vinita Bali 33.72

Mrs. Hema Ravichandar 1.07

Prof. Das Narayandas 30.86

Mrs. Ireena Vittal 49.26

Mr. Bhaskar Bhat 9.90

Mr. S.Subramaniam 14.71

Mr. A.R Rajaram 12.57

iii) The percentage increase in the median remuneration of employees in the financial year - 10.5%

iv) The number of permanent employees on the rolls of Company - 7558.

v) The explanation on the relationship between average increase in remuneration and company performance Â

The average increase in the remuneration of the employees of the organisation takes into account the Company performance which is typically done on a scale of 20, inflation rate in the market and trends as projected by benchmarking professional consultants.

vi) Comparison of the remuneration of the Key Managerial Personnel against the performance of the company:

(Rs. in crores)

Particulars Mr. Bhaskar Bhat, Mr. S. Subramaniam, Mr. A.R. Rajaram, Managing Director Chief Financial Officer Head - Legal & Company Secretary

Remuneration in FY 2015 4.91 2.02 0.81

Revenue 11903.21 11903.21 11903.21

Remuneration

As a % of revenue 0.041% 0.017% 0.006%

Profit before Tax (PBT) 1055.89 1055.89 1055.89

Remuneration (as % of PBT) 0.46% 0.2% 0.1%

vii) Variations in the market capitalisation of the Company, price earnings ratio as at the closing date of the current financial year and previous financial year.

Particulars 2014-15 2013-14 % Change

Market Capitalisation (Rs. crores) 34,765.71 23,322.14 49.06

Price Earnings Ratio 42.24 31.46 34.27

viii) Percentage increase over decrease in the market quotations of the shares of the company in comparison to the rate at which the company came out with the last public offer in case of listed companies, and in case of unlisted companies, the variations in the net worth of the company as at the close of the current financial year and previous financial year.

Particulars 31st March 2015 1987-88 IPO % Change*

Market Price (BSE) in Rs. 392 10 78300

Market Price (NSE) in Rs. 391.60 10 76320

*Adjusted for Bonus and Split in 2011

ix) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

No such differentiation was followed in giving the increment during the last financial year. The average increment in salary was basis individual performance.

x) The key parameters for any variable component of remuneration availed by the directors

The Members had, at the AGM of the Company held on 27th July 2010 approved payment of Commission to the non-executive directors within the ceiling of 1% of the net profits of the Company as computed under the applicable provisions of the Act. The said Commission is decided each year by the Board of Directors and distributed amongst the non-executive directors based on performance evaluation, attendance and contribution at the meetings of the Board and its Committees, as well as the time spent on operational matters other than at meetings.

xi) The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year:

The highest paid Director is the Managing Director. No employee has received remuneration in excess of the Managing Director during the year.

xii) Affirmation that the remuneration is as per the Remuneration Policy of the Company.

The Company''s Remuneration Policy is based on the principle of internal equity, competence and experience of the employee and industry standards. Through its compensation programme, the Company endeavours to attract, retain, develop and motivate a high performance workforce and engaged workforce. The Company follows a compensation mix of fixed pay, benefits and performance based variable pay. Individual performance pay is determined by business performance and the performance of the individuals measured through the annual appraisal process. The Company affirms remuneration is as per the Remuneration Policy of the Company.

Information as per Rule 5(2) of the Chapter XIII, the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

Details of employee remuneration as required under provisions of Section 197 of the Companies Act, 2013 and Rule 5(2) & 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are available at the Registered Office of the Company during working hours before 21 days of the Annual General Meeting. Any member interested in obtaining such particulars may write to the Company Secretary or through mail addressed to [email protected].

AUDITORS

Statutory Auditors

The Members are requested to ratify the appointment of its Statutory Auditors, Messrs Deloitte, Haskins & Sells, Chartered Accountants (Firm''s Registration No. 008072S), from the conclusion of this Thirty First Annual General Meeting upto the conclusion of the Thirty Second Annual General Meeting. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed thereunder for re- appointment as Auditors of the Company. As required under Clause 49 of the Listing Agreement, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its PED activity may require to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed Messrs PSV & Associates to audit the cost accounts of the Company for the financial year 2014-15 on a remuneration of Rs. 3 lakhs. As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a Resolution seeking Member''s ratification for the remuneration payable to Messrs PSV & Associates, Cost Auditors is included at Item No. 7 of the Notice convening the Annual General Meeting.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Messrs HBP & Co, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed herewith as (Annexure-V)

Auditor''s report and secretarial auditor''s report

There are no disqualifications, reservations, adverse remarks or disclaimers in the auditor''s report and secretarial auditor''s report.

Acknowledgements

Your Directors wish to place on record their appreciation of the support which the Company has received from its promoters, shareholders, lenders, business associates, vendors, customers, media and the employees of the Company.

On behalf of the Board of Directors,

C.V. Sankar

7th May 2015 Chairman

Mar 31, 2012

To the Members of TITAN INDUSTRIES LIMITED

The Directors are pleased to present the Twenty-eighth Annual Report and the Audited Statement of Accounts for the year ended 31st March 2012:

Financial Results (Rs. in crores)

2011-2012 2010-2011

Sales Income 8970.86 6570.86

Other Income 94.11 56.08

Total Income 9064.97 6626.94

Less: Excise Duty 132.48 49.97

Net Income 8932.49 6576.97

Expenditure 8005.43 5908.97

Gross profit 927.06 668.00

Finance Costs 43.72 34.52

Cash operating profit 883.34 633.48

Depreciation / Amortisation 44.90 34.48

Profit before taxes 838.44 599.00

Income taxes Current 238.90 168.60

Deferred (5.29) (3.24)

Profit after taxes for the year 604.83 433.64

Less: Income tax of earlier years 4.67 3.22

Net Profit 600.16 430.42

Even as the Indian economy encountered a challenging 2011-12, the Company recorded its best-ever performance.

In 2011-12, the Company's sales income grew by 36.5% to Rs. 8,970.86 crores compared with Rs. 6,570.86 crores in the previous year. Creditably, the percentage growth of our bottom lines was higher: profit before tax grew by 40% to Rs. 838.44 crores, while net profit grew by 39.4% to Rs. 600.16 crores.

Even though the Indian economy grew slower in 2011-12, Titan Industries Limited reported a stronger growth on account of a deep understanding of consumer preferences, product differentiation, new product launches and professional brand management.

Sales of the Watches Division (net of excise duty) grew by 20.3% to Rs.1,529.76 crores, the business achieving breakthroughs in a number of new segments Ã the sub-Rs 500 economy segment where the Sonata Super-Fibre model reported handsome offtake; the children's segment, where Titan Zoop blazed to a sale of half-a- million watches in its very first year of full operations; the expansion of the exclusive Fastrack store network reinforced the brand's excitement across the preferred youth segment; the successful Fastrack products extended into accessories (bags, belts, wallets, wrist-bands). Besides, Helios, the 25-store chain that retails more than 35 international premium and luxury watch brands in addition to the Company's Titan and Xylys brands, performed creditably.

The Company's Jewellery Division sales (net of excise duty) grew by 39.8% to Rs.7,064.16 crores owing to increased sales of diamond- studded jewellery and the grammage growth of gold jewellery despite higher gold prices. The Division launched the Mia and Fq jewellery lines with an eye on working women and the younger generation respectively.

The Company's Eyewear Division, Accessories and Precision Engineering revenues (net of excise duty) cumulatively strengthened by 34.8% to Rs.328.81 crores. The Company's Eyewear business capitalized on retail expansion while the Company's B2B business of Precision Engineering turned around, the challenging environment notwithstanding.

This growth was partly catalyzed by a widening of the retail network through the net addition of 162 stores (2,26,491 sq.ft.) across the Watches, Jewellery and Eyewear Business Divisions. The Company controls a network of 827 stores (including franchisee stores) with over 10,36,000 sq. ft of retail space as on 31st March 2012, which delivered a retail turnover of over Rs. 8,500 crores in 2011-12.

Simultaneously, the Company strengthened its business through fresh investments. It has invested in the commercial production of an integrated state-of-the-art Jewellery unit in the excise-free zone of Pantnagar, Uttarakand. The Rs 15 crore unit was commissioned in March 2012 to manufacture studded jewellery, with a peak employment opportunity of 250 and a projected turnover of Rs. 250 crores in 2012-13.

International operations

Even though the Company was largely focused on the Indian market, it continued to strengthen its international exposure as well.

The Company achieved exports of Rs.160 crores during the year under review comprising watches and precision engineered components; this was a 26.5% improvement over the previous year. The International Watches division, which moved into Vietnam in 2009 and South Africa in 2010-11, reported encouraging results in 2011-12.

While Far East Asian markets continued to do well, some Middle East markets reported sluggishness. The export of precision engineered components reported an improvement in 2011-12 due to a high quality standard, which translated into Precision Engineering Component and Sub-Assemblies (PECSA) orders from the aerospace, oil and gas and electrical sectors while traction for the Machine Building and Automation (MBA) business translated into attractive export orders.

Dividend

The Directors are pleased to recommend the payment of dividend on equity shares at the rate of 175% (Rs.1.75 per equity share), subject to approval by the shareholders at the Annual General Meeting.

Finance

The Indian economy reported slower growth in 2011-12 on account of inflation, rising interest rates, rupee depreciation and commodity volatility. In this uncertain environment, the Company repaid borrowings of Rs.58.07 crores and strengthened its business through a capital expenditure of Rs.136.68 crores in plant refurbishment, expansion programmes, retail outlets and IT hardware systems.

As on 31st March 2012, there were no fixed deposits held by the Company from the public, shareholders and employees other than unclaimed deposits amounting to Rs.0.05 crore.

An amount of Rs.216.31 crores was transferred to the general reserve.

During the year under review, the Company made payments aggregating Rs.992.57 crores by way of taxes (central, state and local) and duties as against Rs. 675.23 crores in the previous year.

Bonus issue and sub-division of equity shares

Pursuant to Section 192A of the Companies Act, 1956, read with the Companies (passing of Resolutions by Postal Ballot) Rules, 2001, approval of the shareholders was obtained by postal ballot for the alteration of the Memorandum of Association of the Company for increase in Authorized Equity Share Capital from Rs. 120 crores to Rs. 160 crores, alteration of the Articles of Association of the Company for increase in Authorized Equity Share Capital, issue of bonus shares in the ratio of one equity share for every one equity share held, alteration of capital clause in the Memorandum of Association of the Company for sub-division of equity shares of a face value of Rs.10 each into 10 equity shares of Re.1 each and alteration of the Articles of Association of the Company to reflect the sub-division of the equity share capital of the Company.

The shareholders of the Company approved the issue of bonus equity shares in the ratio of one equity share for every one equity share held on 24th June 2011, the Record Date and for sub-division of the equity share of Rs. 10 each into 10 equity shares of Re. 1 each, and accordingly allotment of the split cum bonus shares were made to the shareholders of the Company.

Consequently, the paid-up equity share capital of the Company increased to Rs. 88,77,86,160 comprising 88,77,86,160 equity shares of Re. 1 each.

Subsidiaries

As on 31st March 2012, the Company had the following subsidiaries:

1) Titan Time Products Ltd, Goa

2) Titan Properties Ltd, Hosur

3) Favre Leuba AG, Switzerland

In 2011-12, Titan TimeProducts Ltd. sold 8.99 million (2010-11: 8.52 million) electronic circuit boards with a net profit of Rs.102.94 lakhs (2010-11: Rs 72.62 lakhs). Titan Properties Ltd made a net profit of Rs.65.01 lakhs (2010-11: Rs.170.32 lakhs). Favre Leuba AG, Switzerland was incorporated on January 13, 2012 as a limited liability Company owning the trademarks, Favre Leuba. None of these companies declared a dividend in 2011-12.

The annual accounts of these subsidiary companies were consolidated with the accounts of Titan Industries Ltd for 2011-12.

The High Court of Karnataka sanctioned the Scheme of Amalgamation filed by Tanishq (India) Ltd, the Company's wholly- owned domestic subsidiary, with the Company from the appointed date of April 1, 2010. Accordingly, the accounts of Tanishq (India) Ltd. were merged with the accounts of Titan Industries Ltd.

A petition was filed pursuant to Sections 391 to 394 of the Companies Act, 1956 by the Company's subsidiary company, Titan Properties Limited as the Transferor Company, seeking sanction to the Scheme of Amalgamation proposed to be made between itself and its holding Company Titan Industries Ltd as the Transferee Company effective from 1st April 2011 as the appointed date. No shares of the Transferee Company are to be issued pursuant to the Scheme.

The Ministry of Corporate Affairs, Government of India has issued a Circular No. 2 /2011 dated 8th February 2011 granting general exemption to Companies under Sec 212(8) from attaching the documents referred to in Sec 212 (1) pertaining to its subsidiaries, subject to approval by the Board of Directors of the Company and furnishing of certain financial information in the Annual Report.

The Board of Directors of the Company have accordingly decided to dispense with the requirement of attaching to its Annual Report the annual audited accounts of the Company's subsidiaries.

Accordingly, the Annual Report of the Company does not contain the individual financial statements of these subsidiaries, but contains the audited consolidated financial statements of the Company, its subsidiaries and an associate. The Annual Accounts of these subsidiary companies, along with the related information, is available for inspection at the Company's registered office and copies shall be provided on request. The statement pursuant to the approval under section 212(8) of the Companies Act, 1956, is annexed together with the Annual Accounts of the Company. The same will also be available on our web-site www.titan.co.in

Consolidated financial statements

The Consolidated Financial Statements of the Company prepared as per Accounting Standard AS 21 and Accounting Standard AS 23, consolidating the Company's accounts with its subsidiaries and an associate have also been included as part of this Annual Report.

Corporate Social Responsibility

Titan's corporate social responsibility charter prioritized support to the underprivileged in the areas of education, physical disability, employability, skill building and girl child welfare. The Company sustained programmes in these areas in 2011-12 while focusing on two projects - The Girl Child Education program (Titan Kanya) and Project Clean Hosur. Titan Kanya expects to provide education for the girl child, benefiting about 12,000 girl children.

The Company worked with KC Mahindra Education Trust, supporting 2000 girl children in Mumbai, Delhi, Chennai and Hyderabad through the Nanhi Kali program. The Company agreed to support 30 Learning Centers of NGO IIMpact in Dehradun and Roorkee - areas with the poorest female literacy rates in India - that can potentially benefit around 1000 girl children.

The Company also embarked on a citizen-based program to enhance Hosur's cleanliness, inspired by a volunteer-based initiative in Estonia and a similar program in Kulithalai (Tamil Nadu). Over 400 Hosur volunteers, drawn from various walks of life, participated in a pilot project in December 2011. The Sustainable Integrated Solid Waste Management Project for Hosur is expected to go live in July 2012 across Hosur (72 acres, 2.75 lakh population).

Awards and recognition

The Company's initiatives and performance were recognized across various platforms. The Jewellery Division won the coveted JRD-QV Award, securing 602 marks (won by Time Products Division in 2006). Brand Tanishq won numerous awards during the year under review including three awards at Big Bang Advertising Awards for Excellence in Communication and Best campaign, four awards at CMO Asia award for excellence in Branding and Marketing, IRF award for the Most Admired Retail Brand for the luxury segment, two Star Retailer Awards for retail campaign and retail design, ET Retail Award for Innovative Operating Idea of the Year and the Images Fashion Most Admired Jewellery Brand of the Year. Brand Goldplus won the Gem Visions' Designs Appreciation Award.

The Integrated Supply Chain of the Jewellery Division won a number of awards, including the IMTMA Productivity Championship Award, two Qimpro awards for Innovations, Gold Award in ET manufacturing excellence awards in partnership with Frost & Sullivan and Award for Benchmarking and the Golden Peacock Innovation Award.

The 'Titan' watch brand won the Northeast Consumer Award for most preferred watch brand. The Fastrack brand won the Gold Award in IAMAI Digital Media awards for its interactive video SMS.

Titan HTSE mobile application was one amongst the top 5 brands of the world to be nominated for the prestigious Mashables Award, won the Gold at IDM awards, Gold for the "Best use of Emerging Media" at the International Festival for Media apart from many accolades at the Abby Awards in Goafest for the TV Commercial.

The Company was ranked first in the Retail Category for the third year in succession, first in workplace diversity and inclusion and 15th overall in a survey, 'India's best companies to work for' by Great place to Work Institute India.

The Company received the Retailer of the Year award at the Star Retailer and Franchise Awards, Most Admired Fashion Company of the Year at the Images Fashion Awards, ET award for Excellence in Employee Practices and continued to top the Karmayog CSR rating for the fourth consecutive year.

The Company's Managing Director, Mr. Bhaskar Bhat was recognized as the Indian Retail Forum's Most Admired Retail Professional of The Year and The ET Retail Personality of the Year.

Particulars of Employees

In terms of provisions of section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, the names and other particulars are set out in the Annexure to the Directors' Report. However, having regard to the provisions of section 219 (1) (b) (iv) of the Companies Act, 1956, the Annual Report excluding the aforesaid information is being sent to all the members of the Company, and others entitled thereto. Any member interested in obtaining such particulars may write to the Company Secretary at the Registered Office of the Company or through mail by sending their requests to the Company Secretary.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo in accordance with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed to this report.

Corporate governance

A separate report on Corporate Governance forms a part of the Annual Report along with the Auditors' Certificate on Compliance.

Directors' Responsibility Statement

Pursuant to section 217(2AA) of the Companies Act, 1956, the Directors' based on the representations received from the operating management confirm that:

1. In the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

2. They have in the selection of the accounting policies, consulted the statutory auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for that period;

3. They have taken proper and sufficient care, to the best of their knowledge and ability, for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. They have prepared the annual accounts on a going concern basis.

Auditors

Members will be requested at the Annual General Meeting to appoint auditors for the current year and pass resolutions per Item No. 6 of the Notice.

Directors

Mrs. Hema Ravichandar, Mr. R.Poornalingam and Mr. N.N. Tata retire by rotation and are eligible for re-appointment.

Mr. K. Dhanavel, IAS, Managing Director of Tamilnadu Industrial Development Corporation Ltd (TIDCO) was appointed as a Director on the Board of the Company on 30th April 2012, as a nominee of TIDCO.

Members attention is drawn to Item No.7 of the Notice for the appointment of Mr. K. Dhanavel as a Director of the Company.

Acknowledgements

Your Directors wish to place on record their appreciation of the support which the Company has received from its promoters, lenders, business associates including distributors, vendors and customers, the press and the employees of the Company.

On behalf of the Board of Directors,

N. Sundaradevan

Bangalore, 25 June 2012 Chairman

Mar 31, 2011

To the Members of Titan Industries Limited

The Directors are pleased to present the Twenty seventh Annual Report and the Audited Statement of Accounts for the year ended 31st March 2011:

Financial Results

Rs. in crores

2010-2011 2009-2010

Total Income 6626.94 4714.98

Less: Excise Duty 49.97 28.70

Net Income 6576.97 4686.28

Expenditure 5935.28 4279.46

Gross profit 641.69 406.82

Interest 8.21 25.42

Cash operating profit 633.48 381.40

Depreciation / Amortisation 34.48 60.08

Profit before taxes 599.00 321.32

Income taxes - Current 168.60 81.50

- Deferred (3.24) (13.42)

Profit after taxes for the year 433.64 253.24

Less: Income tax of earlier years 3.22 2.92

Net Profit 430.42 250.32

Profit brought forward 272.91 211.03

Amount available for appropriation 703.33 461.35

Appropriations :

Debenture redemption reserve 5.28 5.28

Proposed dividend on equity shares 110.97 66.58

Tax on dividends 18.00 11.06

Transfer to general reserve 136.46 105.51

270.71 188.43

Balance carried forward 432.62 272.92

Titan Industries Limited has delivered one of its best ever performances. Sales income for the year 2010-11 was Rs.6570.86 crores, registering a growth of 39.7% over previous year's sales of Rs.4703.12 crores. This growth was attributable to the continued dynamism of the Indian economy resulting in high consumer confi dence, favorable demographics of our primary market - India, the unique position Titan and its brands occupy in the consumers' mind space and the talent and commitment exhibited by the Company's employees and business associates.

Profit before tax for the Company grew by 86.4% to Rs.599.00 crores, while net profit grew by 71.9% over previous year to Rs.430.42 crores.

Both Watches and Jewellery segments recorded excellent growth on the back of very good retail sales. Watch Business achieved breakthrough in several new consumer segments in the watch market Ã the sub Rs.500 economy segment,

where Sonata Super-Fibre recorded handsome sales and the children's segment, with Titan Zoop. The successful expansion of exclusive Fastrack stores net work has reinforced Fastrack's position as India's most exciting youth brand. The Company also took confident steps into accessories market with the national launch of Fastrack accessories (bags, belts, wallets, wrist-bands). The Jewellery Division aggressively pursued growth of diamond studded jewellery and was also able to improve the grammage growth of gold jewellery, despite the increase in gold prices. The Eyewear business witnessed rapid expansion of its retail network, with healthy sales growth in like-to-like stores. The B2B business of Precision Engineering which was hit last year due to global slowdown made good recovery and performed reasonably well compared to the previous year.

The Jewellery segment sales grew by 43.5% to Rs.5027.23 crores and the Watch segment sales grew by 23.3% to Rs.1266.46 crores. Sales of others including Eyewear, accessories and Precision Engineering rose by 60.7% to Rs.243.87 crores.

The year witnessed expansion of the Company's retail network with a net addition of 122 stores (124503 sq.ft.) across Watches, Jewellery and Eyewear businesses. As on 31st March 2011, the Company has a total of 665 stores, with over 810000 sq.ft of retail space, delivering a retail turnover in excess of Rs.6150 crores.

International operations

The Company achieved an export turnover of Rs.127 crores during the year. Exports include sale of watches and precision engineered components.

The International Business Division of Watches made a splendid foray into Vietnam in 2009 and followed it up with an equally successful launch in South Africa in 2010-11, the initial results of which have been encouraging. While Far East Asian markets continued to do well, some Middle East markets reported sluggish economies and results during the year. The export of precision engineered components during the year showed improvement over the previous year.

Dividend

The Directors are pleased to recommend payment of dividend on equity shares at the rate of 250% (Rs.25 per equity share), subject to approval by the shareholders at the Annual General Meeting. The dividend payout on equity shares recommended by the Directors of the Company is Rs.110,97,32,700 calculated at the rate of Rs. 25 per equity share on 4,43,89,308 equity shares of the face value of Rs.10 each.

However, it is to be noted that at the said meeting of the Board of Directors of the Company, the Directors have also recommended issue of bonus shares in the ratio of one equity share for every existing equity share of Rs. 10 each and sub-division of equity share of Rs. 10 into 10 equity shares of Rs.1 each, subject to approval by the members of the Company. Consequent to the issue of the bonus shares and sub-division of equity shares, while the aggregate amount of dividend on equity shares if declared at the 27th Annual General Meeting shall remain unchanged at Rs.110,97,32,700, the rate per equity share shall be adjusted to the number of equity shares outstanding arising out of the issue of bonus shares and sub-division of equity shares. In other words, the rate of dividend on equity shares will be Rs. 1.25 on 88,77,86,160 equity shares of Re. 1 each, aggregating Rs.110,97,32,700.

Finance

During the year under review, borrowings of Rs.5.42 crores were repaid during the year. The Company incurred Rs.66.24 crores as capital expenditure in respect of refurbishment and expansion programmes at manufacturing facilities and retail outlets and in IT Hardware systems.

The Company's continued effort at conserving cash and containing capital employed has enabled the company to generate net cash infl ow of Rs.907 crores.

During the year, the Company's long term debt rating was upgraded by CRISIL to AA /Stable (pronounced "double A plus with stable outlook) from AA/Stable, indicating high degree of safety. ICRA has reaffi rmed the long term debt rating of LAA (pronounced as L Double A) with a positive outlook which indicates high credit quality.

The year 2010-11 witnessed smart growth by various sectors including agriculture, industry and service. However, high infl ation has been a major concern which prompted the Reserve Bank of India to tighten the monetary policy by increasing the key interest rates.

Titan Industries Limited

As on 31st March 2011, there were no fixed deposits held by the Company from the public, shareholders and employees other than unclaimed deposits amounting to Rs.0.06 crores.

An amount of Rs.5.28 crores has been transferred to the debenture redemption reserve in accordance with statutory requirements and the terms of Rights Issue.

As amount of Rs.136.46 crores has been transferred to the general reserve .

During the year under review, the Company made payments aggregating to Rs.675.23 crores by way of central, state and local taxes and duties as against Rs.456.65 crores in the previous year.

The Company has redeemed 21,13,038 6.75% Non- convertible Debentures of a face value of Rs. 250/- each aggregating to Rs.52.83 crores on 11th May 2011 in terms of the issue of these Debentures.

Bonus Issue and sub-division of equity shares

The Board of Directors have approved the Issue of Bonus Shares in the ratio of 1 equity share for every 1 equity share held, to the existing shareholders of the Company and sub-division of the Company's equity share of Rs.10 each into 10 equity share of Re.1 each.

Pursuant to Sec 192A of the Companies Act, 1956, read with the Companies (Passing of the Postal Ballot) Rules, 2001 approval of the shareholders was sought by Postal Ballot in respect of amendment to the Memorandum of Association and Articles of Association of the Company for increase in Authorized Share Capital, Issue of Bonus Shares in the ratio of 1 fully paid share for every 1 share held and sub-division of the equity share of the Company of the face value of Rs.10 each in to 10 equity shares of Re.1 each. The Resolutions put to vote through Postal Ballot has been passed by the Shareholders of the Company with the requisite majority. The Board of Directors have fixed the "Record Date" (24th June 2011) for the issue of bonus shares and sub-division of the equity shares of the Company, subject to such statutory and other approvals as may be required.

Subsidiaries

As at 31st March 2011, the Company has the following subsidiaries:

1) Titan TimeProducts Ltd, Goa

2) Tanishq (India) Ltd, Bangalore

3) Titan Properties Ltd, Hosur

The performance highlights of these subsidiary companies for FY 2010-11 are as under:

Titan TimeProducts Ltd. sold 8.52 million (2009-10: 6.27 million) Electronic Circuit Boards in 2010-11 and made a net profit of Rs.72.62 lakhs (2009-10: Rs 34.43 lakhs).

Tanishq (India) Ltd. made a net profit of Rs.32.56 lakhs (2009-10:Rs.41.92 lakhs) and Titan Properties Ltd made a net profit of Rs.170.32 lakhs (2009-10: Rs.9.53 lakhs).

None of these companies has declared a dividend.

The annual accounts of the above three subsidiary Companies have been consolidated with the Accounts of Titan Industries Ltd for the fi -nancial year 2010-11.

A Petition has been filed pursuant to sections 391 to 394 of the Companies Act, 1956 by the Company's subsidiary company Tanishq (India) Limited as the Transferor Company seeking sanction to the Scheme of Amalgamation proposed to be made between itself and its holding company Titan Industries Ltd as the Transferee Company effective 1st April 2010 as the Appointed Date. No shares of the Transferee Company are to be issued pursuant to the Scheme. Based on an application made under section 391 of the Companies Act, 1956, by the Transferor Company, the Hon'ble High Court of Karnataka which has jurisdiction over the Transferor Company has granted dispensation of the meetings of shareholders and creditors of the Transferor Company.

A Company Petition No. 9 of 2011 was filed in the Karnataka High Court by Tanishq (India) Ltd, Transferor Company on 7th January 2011 seeking sanction to the amalgamation as aforesaid and the fi nal order in respect thereof is awaited.

The Ministry of Corporate Affairs, Government of India has issued a Circular No. 2 /2011 dated 8th February 2011 granting general exemption to Companies under Sec 212(8) from attaching the documents referred to in Sec 212 (1) pertaining to its subsidiaries, subject to approval by the Board of Directors of the Company and furnishing of certain fi -nancial information in the Annual Report.

The Board of Directors of the Company have accordingly accorded approval to the Company dispensing with the requirement of attaching to its Annual Report the annual audited accounts of the Company's subsidiaries.

Accordingly, the Annual Report of the Company does not contain the individual financial statements of these subsidiaries, but contains the audited consolidated financial statements of the Company, its subsidiaries and an associate. The Annual Accounts of these subsidiary companies, along with the related information, is available for inspection at the Company's registered offi ce and copies shall be provided on request. The statement pursuant to the approval under section 212(8) of the Companies Act, 1956, is annexed together with the Annual Accounts of the Company.

Consolidated financial statements

The Consolidated Financial Statements of the Company prepared as per Accounting Standard AS 21 and Accounting AS 23, consolidating the Company's accounts with its subsidiaries and an associate have also been included as part of this Annual Report.

Corporate Social Responsibility

Our business-linked initiatives like MEADOWS women empowerment program and the Karigar Parks, employment of the differently abled, education initiatives in the Titan Scholarship Program and the Titan School are programmes that the Company continued to support during FY 2010-11. The Mr. Perfect programme of the Jewellery Division, which seeks to ensure a clean and modern work space for the skilled craftsmen in our Jewellery business and also aims to retain and enhance human skills, has gained momentum and is targeting to cover all our vendor partner units in the next 18 months.

Apart from these on-going initiatives, the following important initiatives were conceived /supported by the Company:

1. 100,000 dark glasses were given free to Sankara Nethralaya for poor patients to wear after their cataract surgery.

2. A special watch was created and marketed in commemoration of the 26/11 Mumbai blasts, with all the sale proceeds being given to the Taj Public Service Welfare Trust towards the welfare of the victims.

3. A systematic process for evaluating worthy causes was created with a cross-functional team comprising managers. The team selected three NGOs out of sixty applications received and they are:

- The Samarthanam Trust for the disabled;

- The Spastics Society of Karnataka and

- The SGBS Trust in their Unnati programme of enabling employability of underprivileged youth. The Company will support these NGOs for a three year period.

Awards and Recognition

The Jewellery Division of the Company won the inaugural Most Innovative Retailer Award of the Economic Times, apart from two individual awards for Gold Plus and one for Tanishq in the same competition. The Tanishq wedding television commercial won two prestigious Effies (Effectiveness Awards of the advertising industry) and was also rated among the top 10 films of the year by television channels. The Gold Plus Loyalty programme Ananta won many awards across the country including the Qimpro Award. Zoya won the store launch and couture Jewellery of the year from the Jewellery industry.

The Integrated Supply Chain of Jewellery Division won many awards, including the CII Quality Award, the Frost & Sullivan Award for Benchmarking and the Golden Peacock Innovation Award.

The watch brand ÃTitan' has been ranked 10th amongst 16,000 brands studied across nine Indian cities in a Brand Trust Study by Trust Research Advisory. Brand Titan was also ranked as the Most Admired Timewear Brand in the Images

Titan Industries Limited

Fashions Award 2011.The Company also won the World watch award from the Chitralekha group for the Flagship store at Linking Road, Mumbai as being the best watch store. This same store was also rated for the best Retail signage by 3M, across all product categories. The Company won several "Big Bang awards" for excellence in advertising and media for the marketing campaigns of "Raga Flora" and "Titan - Be More" instituted by the Advertising Club, Bangalore. The Fastrack Brand won the Master Brand Award 2010, given by CMO Council.

The Company has been ranked 1st in the Retail Category and 19th overall by the "Great Place To Work" Institute in their survey "India's Best Companies To Work For."

The Company received the Best Commercial Establishment Award for Corporate Sustainability from Tamil Nadu Government and the Economic Times Retail Award for the "Most Innovative Retailer".

Annexures

In terms of provisions of section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, the names and other particulars are set out in the Annexure to the Directors' Report. However, having regard to the provisions of section 219 (1) (b) (iv) of the Companies Act, 1956, the Annual Report excluding the aforesaid information is being sent to all the members of the Company, and others entitled thereto. Any member interested in obtaining such particulars may write to the Company Secretary at the Registered Offi ce of the Company or through mail by sending their requests to the Company Secretary at [email protected]. Required information as per section 217(1)(e) is annexed.

Auditors

Members will be requested at the Annual General Meeting to appoint auditors for the current year and pass resolutions per Item No. 6 of the Notice.

Corporate Governance

A separate report on Corporate Governance forms a part of the Annual Report along with the Auditors' Certifi cate on Compliance.

Directors

Mr. Ishaat Hussain, Ms. Vinita Bali and Mr. V Parthasarathy retire by rotation and are eligible for re-appointment.

Mr. Sunil Paliwal, IAS resigned as Director of the Company on 6th December 2010. The Directors wish to record their gratitude and appreciation for the wise counsel and contribution made by Mr. Sunil Paliwal during his tenure as a Director of the Company.

Mr. Nihal Kaviratne, Independent Director resigned from the Board of the Company with effect from 3rd March 2011. Mr. Kaviratne joined the Board in September 2006 and has made valuable and signifi cant contribution to the growth and progress of the Company. As Chairman of the Board Audit Committee, Mr. Kaviratne has displayed high level of professionalism and outstanding leadership in rendering direction and guidance to the Company. The Directors wish to record their gratitude and appreciation for the wise counsel and contribution made by Mr. Nihal Kaviratne during his tenure as Chairman of the Board Audit Committee and as a Director of the Company.

Prof. Das Narayandas was appointed as an Additional Director of the Company on 29th April 2011.Prof. Das Narayandas is the James J. Hill Professor of Business Administration at the Harvard Business School and currently is the Chair of Harvard Business School Executive Education's Advanced Management Program and co-chair of the Building Client Management Capabilities in Professional Service Firms. His academic credentials included a Bachelor of Technology degree in Engineering from the Indian Institute of Technology, a Post-Graduate Diploma in Management from the Indian Institute of Management, and a Ph.D. in Management from Purdue University, USA.

Members attention is drawn to Item No. 7 of the Notice for the appointment of Prof. Das Narayandas as a Director of the Company.

Mrs. Susan Mathew, IAS, Additional Chief Secretary to the Government of Tamilnadu, and Chairperson, Tamilnadu Industrial Development Corporation Ltd (TIDCO) was appointed as Chairperson and Director on the Board of the Company on 14th June 2011 as a nominee of TIDCO.

Members attention is drawn to Item No. 8 of the Notice for the appointment of Mrs. Susan Mathew as a Director of the Company.

Dr. N. Sundaradevan, IAS, Principal Secretary to the Government of Tamilnadu, Industries Department was appointed as a Director on the Board of the Company on 14th June 2011 as a nominee of TIDCO.

Members attention is drawn to item no. 9 of the Notice for the appointment of Dr. N. Sundaradevan as a Director of the Company.

Mr. Debendranath Sarangi, IAS and Mr. Rajeev Ranjan, IAS resigned as Directors of the Company on 14th June 2011. The Directors wish to record their gratitude and appreciation for the wise counsel and contributions made by them during their tenures as Directors of the Company.

Directors' Responsibility Statement

Pursuant to section 217(2AA) of the Companies Act, 1956, the Directors' based on the representations received from the operating management confi rm that:

1. In the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

2. They have in the selection of the accounting policies, consulted the statutory auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for that period;

3. They have taken proper and suffi cient care, to the best of their knowledge and ability, for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. They have prepared the annual accounts on a going concern basis.

Acknowledgements

Your Directors wish to place on record their appreciation of the support which the Company has received from its promoters, lenders, business associates including distributors, vendors and customers, the press and the employees of the Company.

On behalf of the Board of Directors,

Bhaskar Bhat C G Krishnadas Nair

Bangalore, 14th June 2011 Managing Director Director

Mar 31, 2010

The Directors are pleased to present the Twenty sixth Annual Report and the Audited Statement of Accounts for the year ended 31st March 2010:

Financial Results

Rs. in Crores

2009-2010 2008-2009

Total Income 4714.98 3852.98 Less: Excise Duty 28.70 44.34 Net Income 4686.28 3808.64 Expenditure 4279.46 3506.89 Gross profit 406.82 301.75 Interest 25.42 29.43 Cash operating profit 381.40 272.32 Depreciation/Amortisation 60.08 41.76 Profit before taxes 321.32 230.56 Income taxes - Current 81.50 63.00 - Deferred (13.42) (6.53) - Fringe Benefit Tax - 4.21 Profit after taxes for the year 253.24 169.88 Less : Income tax of earlier years 2.92 10.92 Net Profit 250.32 158.96 Profit brought forward 211.03 218.55 Amount available for appropriation 461.35 377.51 Appropriations: Debenture redemption reserve 5.28 5.28 Proposed dividend on equity shares 66.58 44.39 Tax on dividends 11.06 7.54 Transfer to general reserve 105.51 109.27 188.43 166.48 Balance carried forward 272.92 211.03

In its silver jubilee year, Titan Industries Limited has come out with a sterling performance. Sales income for the year 2009-10 was Rs.4,703.12 crores, crossing the billion dollar (US) figure and registering a growth of 22.2% over last year sales of Rs.3,847.72 crores. The year started on a sombre note against the backdrop of a slowdown worldwide but the recovery of the Indian economy and strategic steps taken by Titan Industries have helped register a historic performance. Profit before tax for the Company grew by 39.4% to Rs.321.32 crores, while net profit grew by 57.5% over last year to Rs.250.32 crores.

Both Watches and Jewellery segments benefited from a good wedding season in the first quarter of 2009-10. Retail sales were extremely good for watches post October 2009. Tanishq ran a successful promotion the Queen of Diamonds and the new Eyewear business had an extremely impactful activation in the first half of the year and a very successful advertising campaign in the last quarter of the year.

The Jewellery segment sales grew by 26.8% to Rs. 3,504.19 crores and the Watch segment sales grew by 13% to Rs.1,026.78 crores. Sales of others including Eyewear and Precision Engineering rose by 11.4% to Rs.151.76 crores.

The year witnessed expansion of the Companys retail network with a net addition of 52 stores (81,267sq.ft.) across Watches, Jewellery and Eyewear businesses. As on 31st March 2010, the Company has a total of 539 stores, with over 6,85,000 sq. ft of retail space, delivering a retail turnover of Rs. 4,400 crores.

To support the increase in sales growth, the Company has established one more assembly unit on 29th March 2010, at an excise duty free zone in Uttarakhand State, with a production capacity of 5.0 million watches per annum having-a total built up area of 4,500 sqmtrs.

International Operations

The Company achieved an export turnover of Rs.101 crores during the year. Exports include sale of watches and precision engineered components.

The international markets for watches presented a mixed picture, with markets such as Vietnam, Saudi Arabia and Qatar displaying good growth, but countries such as UAE and Singapore remained sluggish. The export of precision engineered components during the year was impacted due to the global meltdown.

Dividend

The Directors are pleased to recommend payment of dividend on equity shares at the rate of 150% {Rs.15.00 per equity share), subject to approval by the shareholders at the Annual General Meeting.

Finance

During the year under review, the Company raised a total of Rs.10.43 crores from commercial banks. Borrowings of Rs.110.47 crores were repaid during the year. The Company incurred Rs. 44.16 crores as capital expenditure in respect of refurbishment and expansion programmes at manufacturing facilities and retail outlets and in IT Hardware systems.

The Companys continued effort at conserving cash and containing capital employed has enabled the company to reduce its borrowings by more than Rs.100 crores and generate net cash inflow of Rs.232 crores.

During the year, the Companys long term debt rating was upgraded from AA- Stable (pronounced as AA minus) to AA Stable. This indicates high degree of safety.

The Indian economy however started showing revival during the later half of the year. Due to Inflationary pressures. Reserve Bank of India had to tighten the monetary policy by increasing the key interest rates.The Companys average cost of borrowings for the year was 10.70% as against 10.97% in the previous year.

As on 31st March 2010, there were no fixed deposits held by the Company from the public, shareholders and employees other than unclaimed deposits amounting to Rs.0.08 crores.

An amount of Rs.5.28 crores has been transferred to the debenture redemption reserve in accordance with statutory requirements and the terms of Rights Issue.

As amount of Rs.105.51 crores has been transferred to the general reserve.

During the year under review, the Company made payments aggregating to Rs. 456.65 crores by way of central, state and local taxes and duties as against Rs. 388.23 crores in the previous year.

Amortization of Trademarks

During the year, the Company reviewed the expected pattern of economic benefits from the use of trademarks. Consequent to such review, a further amount of Rs. 24.04 crores has been amortized.

Change in the method of valuation of inventory

Consequent to the adoption of hedge accounting of gold, for a more accurate reflection of the operational performance and appropriate presentation of the financial statements, the Company has adopted First-in-First-Out (FIFO) method of valuation of gold from April 1,2009 as against weighted average method adopted upto March 31,2009. This change has resulted in a higher profit before taxes of Rs. 13.41 crores during the year ended March 31,2010.

Subsidiaries

As part of the proposal to reduce the number of subsidiary companies, the Board of Directors of the Company have approved the amalgamation of Tanishq (India) Ltd, with the Company, for which the process of the Scheme of Merger is proposed to be filed with the jurisdictional High Courts.

Titan Mechatronics Ltd ceased to be a subsidiary of the Company on 30th March 2010 consequent to the Company divesting its entire shareholding in the subsidiary.

As at 31st March 2010, the Company has the following subsidiaries:

1) Titan TimeProducts Ltd, Goa 2) Tanishq (India) Ltd, Bangalore 3) Titan Properties Ltd, Hosur

The performance highlights of these subsidiary companies for FY 2009-10 are as under:

Titan TimeProducts Ltd sold 6.27 million (2008-09: 6.85 million) Electronic Circuit Boards in 2009-10 registered a turnover of Rs.1,461.59 lakhs (2008-09: Rs. 1,591.38 lakhs) and a net profit of Rs.34.43 lakhs (2008-09: Rs. 80.68 lakhs).

Tanishq (India) Ltd made a net profit of Rs. 41.92 lakhs (2008-09: Rs.23.30 lakhs);Titan Properties Ltd made a net profit of Rs. 9.53 lakhs (2008-09: Rs. 382.02 lakhs).

None of these companies has declared a dividend.

As per section 212(1) of the Companies Act, 1956, the Company is required to attach to its Accounts the Directors Report, Balance Sheet and Profit and Loss Account of each of these subsidiaries. As the consolidated accounts present a complete picture of the financial results of the Company and its subsidiaries, the Company had applied to the central government seeking exemption from attaching the documents referred to in section 212 (1). Approval for the same has been granted. Accordingly, the annual report of the Company does not contain the individual financial statements of these subsidiaries, but contains the audited consolidated financial statements of the Company and its subsidiaries. The annual accounts of these subsidiary companies, along with the related information, is available for inspection at the Companys registered office and copies will be provided on request. The statement pursuant to the approval of the central government under section 212(8) of the Companies Act, 1956, is annexed together with the annual accounts of the Company.

Consolidated Financial Statements

The Consolidated Financial Statements of the Company prepared as per Accounting Standards AS 21, consolidating the Companys accounts with its subsidiaries has also been included as part of this Annual Report.

Outlook for 2010-11

The year 2009-10 started on a rather cautious note against the backdrop of the global economic meltdown. However, during the later half of 2009-10, Indian economy showed a turn around with a double digit industrial growth and enhanced consumer confidence.

The Watch business will continue to pursue profitable growth through investment in brands, sensible expansion of retail net work, making Titan a premium brand, product innovation and new product collections and other initiatives in Manufacturing and Sourcing.

The watch business will also continue to drive profitable growth in existing Asian markets, focus on marketing investments in Vietnam, Saudi Arabia and South Africa.

The Jewellery business will continue its growth path through various initiatives, including launching of new collections, setting up large format stores, increasing share of studded jewellery and achieving design leadership.

The Precision Engineering Division of the Company, which was significantly impacted in 2009-10 due to the global melt down and the slow down of the Indian manufacturing sector, will continue to build technical expertise comparable to leading international players, develop industry specific capabilities, focus on developing quality vendors, besides seeking opportunities for moving up the value chain.

The Companys fledgling Eyewear business will pursue its focus on enhancing its market share through several initiatives, including expansion of its retail net work, introduction of technologically superior lens products, build awarenenss/brand appeal through mass media, and by creating a differentiated and consistent service ambience across all stores.

Overall, the year 2010-11 will be a year where the Company would drive for strong and profitable growth in all its Indian consumer businesses, retain focus on elimination of wasteful costs, and skillfully navigate the international businesses which will continue to pose challenges due to sluggish demand in some of the geographies.

Corporate Social Responsibility

Titan Industries Limited has over the past many years made a conscious effort to incorporate sustainability principles in its approach to Business.

Corporate Sustainability is about sustainability of Profits, Planet and People. It is about value creation that provides lasting and enduring benefits leading to the enhancement of human, social, natural economic and financial capital.

Our initiatives in MEADOWS women empowerment program, employment of the differently abled, education initiatives in the Ttan Scholarship Program, the Titan School and skill enhancement and business linked initiatives such as the Karigar Parks are to be viewed in this context of enhancing human and social capital. The Jewellery division of the Company has recently launched the Mr. Perfect program which ensures a clean and modern work space for the skilled craftsmen in our Jewellery business and is also aimed at retention and enhancement of human skills.

In the year under review, the number of people impacted by the MEADOWS program increased for 135 to 160 and the Karigar Parks from 139 to 153. Under the Titan Scholarship program, the number of recipients increased from 44 to 1 u.The number of saplings planted during the year increased from 9,000 to 11,000. Titan Industries in partnership with Narayana Nethralaya regularly conducts Eye Camps in rural Tamil Nadu. This year 25 Eye Camps were held during which 2,634 free spectacles were distributed, up from 1,676 last year.

All these initiatives create a socially and ethically responsible business entity and helps in long term sustainability thus ensuring value growth for all our various stakeholders.

Awards and Recognition

Titan Industries received the Award for the Most Admired Timewear Brand of the Year in 2009. And to follow was, the Most Admired Jewellery Brand of the Year. Titan has won for the ninth consecutive year and Tanishq has won for the seventh consecutive year.

While honouring Titan Industries sustainable advantages, Indian Fashion Award (IFA) presented the Company with a special award to acknowledge its uncontested leadership in the Timewear and Jewellery categories.

Particulars of Employees

In terms of provisions of section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, the names and other particulars are set out in the Annexure to the Directors Report. However, having regard to the provisions of section 219(1)(b)(iv) of the Companies Act, 1956, the Annual Report excluding the aforesaid information is being sent to all the members of the Company, and others entitled thereto. Any member interested in obtaining such particulars may write to the Company Secretary or through mail by sending their requests to the Company Secretary at [email protected].

Annexure

Required information as per section 217(1)(e) of the Companies Act, 1956 is annexed.

Auditors

Members will be requested at the Annual General Meeting to appoint auditors for the current year and pass resolutions per item No. 6 of the Notice.

Corporate Governance

A separate report on Corporate Governance forms a part of the Annual Report along with the AuditorsCertificate on Compliance.

Directors

Mr. N N Tata, Mr. T K Balaji and Dr. C G Krishnadas Nair retire by rotation and are eligible for re-election.

Mr. Rajeev Ranjan, IAS, Principal Secretary to the Government of Tamilnadu, Industries Department, and a nominee of Tamilnadu Industrial Development Corporation Ltd (TIDCO) was appointed as Chairman and Director on the Board of the Company on 29th January 2010. Mr. M. F. Farooqui, IAS resigned as Chairman and Director of the Company on 29th January 2010. The Directors wish to record their gratitude and appreciation for the wise counsel and contribution by Mr. M.F. Farooqui during his tenure as a Director of the Company. Members attention is drawn to item no 7 of the Notice for the appointment of Mr. Rajeev Ranjan as a Director of the Company.

Directors Responsibility Statement

Pursuant to section 217(2AA> of the Companies Act, 1956, the Directors based on the representations received from the operating management confirm that:

1. in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

2. they have in the selection of the accounting policies, consulted the statutory auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for that period;

3. they have taken proper and sufficient care, to the best of their knowledge and ability, for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. they have prepared the annual accounts on a going concern basis.

Acknowledgements

The Directors wish to place on record their appreciation of the support which the Company has received from its promoters, lenders, business associates including distributors, vendors and customers, the press and the employees of the Company.

On behalf of the Board of Directors,

Rajeev Ranjan Bangalore, 7th June 2010 Chairman

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