DIRECTORS' REPORT

TO

THE MEMBERS, ICRA LIMITED

Your Directors have pleasure in presenting the 25th Annual Report of your Company along with the Audited Financial Statements for the year ended March 31, 2016

REVIEW OF OPERATIONS

Rating Services Market Overview

Compared with the previous fiscal, the macroeconomic situation improved in FY2016, following moderation in retail inflation, further narrowing of the current account and fiscal deficits and pickup in headline economic growth. However, exchange rate volatility increased somewhat in FY2016 as compared with FY2015, particularly on account of global cues such as divergent and unconventional monetary policies adopted by the central banks of various advanced economies.

The recovery in Indian economic activity was narrowly focused in sectors such as roads, railways and power transmission, some of which benefited from the enhanced capital spending by the Government of India (GoI) as well as the investor friendly policy measures introduced by it. However, sectors serving the rural economy and exports faced significant headwinds, resulting in moderate capacity utilisation and constraining capacity expansion in a number of industries. Subdued corporate performance, high leverage levels of some large corporate groups and weak asset quality of the banking system continued to weigh on investment sentiment.

With moderation in retail inflation, the Reserve Bank of India (RBI) reduced the benchmark repo rate by 75 basis points (bps) during FY2016. In line with the mixed trends in economic activity, credit growth of the banking system improved modestly in FY2016, despite the lower working capital requirement following the moderation in commodity prices. Faster transmission of monetary easing to the bond markets also led to a trend of disintermediation during the early part of the year, with a number of corporates accessing the domestic bond markets. Primary domestic equity issuances (net of GoI disinvestment) recorded a modest improvement in FY2016.

Benign crude oil and other commodity prices contributed to a further narrowing of India's current account deficit (CAD), despite the sustained contraction in exports. The GoI remained committed to fiscal consolidation, retaining the previously announced fiscal deficit targets for FY2017, in spite of the impending rise in pay and pensions following the Seventh Central Pay Commission's recommendations, which has dampened bond yields and set the stage for further monetary easing in April 2016.

A cyclical upturn in agriculture and rural demand on expectations of favourable monsoon as well as revision in salaries and pensions of Central government employees after the implementation of the recommendations of the Seventh Central Pay Commission are expected to boost economic activity in FY201 7. Recent monetary easing and change in the central bank's stance on liquidity, reduction in small savings rates by the GoI, and the implementation of the new Marginal Cost of Funds-based Lending Rate (MCLR) regime by banks should further ease bank lending rates, resulting in an increase in bank credit growth. The trend of special purpose vehicles (SPVs)—set up for implementation of infrastructure projects— looking to replace their high cost bank borrowings with bond issuances should continue in FY2017. This, along with the implementation of various regulatory steps—such as electronic auction platform for primary offering of corporate debt; complete information repository for corporate bonds; and guidelines encouraging large borrowers to access a certain portion of their financing needs through market mechanism—augurs well for the domestic corporate bond market.

Corporate Sector

As in the previous two years, the market for bank loan ratings remained sluggish in 2015-16 too, affected by muted growth in corporate credit and the continuance of a subdued investment climate. Despite the several measures taken by the Central government, private capital expenditure did not show any meaningful recovery, being weighed down by weak demand and the high leverage of a large number of corporates.

Adding to the sluggishness in the bank market, total domestic bond issuance decreased by around 191% in 2015-16 as against the over 60% growth reported in the previous year. This is despite the rising trend in disintermediation, with large corporates increasingly accessing the capital markets to meet their funding requirements. To an extent, the moderation in bond issuance in 2015-16 can be attributed to increasing risk aversion to issuers rated below high investment grade level. The spike in yields towards the latter part of 2015-16 also adversely affected bond issuance. On the positive side, the trend of SPVs in the infrastructure sector accessing the bond market to refinance bank loans continued during the year, although the pace was much lower than previously anticipated.

With the transmission of monetary policy actions being faster through the debt capital markets than the banking channel, better rated entities continued to use the commercial paper (CP) route to meet their funding requirements. Thus, there was an increase of 42% in CP issuances and of 35% in CPs outstanding in 2015-16 over the previous fiscal.

Since the last quarter of the previous fiscal year, the business of rating small and medium enterprises (SMEs) received a setback as the National Small Scale Industries Corporation (NSIC) cut back the subsidy on the performance and credit rating scheme for SMEs. The SME rating business remained very sluggish during 2015-16.

Financial Sector

Total domestic bond issuance volumes by financial sector entities declined by 11% during 2015-16 as against the 42% rise reported during the previous fiscal. The de-growth was led largely by a 19% decline in bond issuances by banks as compared with the 165% growth they had reported the previous fiscal. The weak growth in domestic banking credit in 2015-16 and the lower appetite for capital bonds issued by banks (many of which faced rating pressures on account of asset quality related concerns) were the main reasons for the lower bond issuance by banks. At the same time, non-banking finance companies (NBFCs) also reported a moderation in bond issuance volumes in 2015-16, posting a 9% decline as against the 25% growth reported the previous fiscal. The NBFCs continued to take advantage of the finer rates in the debt capital markets amidst steady inflows into the mutual funds and insurance sectors during 2015-16 as the base rates of banks continued to remain high. However the NBFC debt issuance volumes declined in the last quarter of 2015-16 partly attributable to the new guidelines issued by the Securities and Exchange Board of India (SEBI) restricting investments by mutual funds into NBFCs and lowering the exposure limits for mutual funds to a single obligor and also at group level. Despite the challenges, your Company, during the year under review, was able to use its strong presence in the financial sector to continue adding new clients while also increasing the volume of rated debt. The expectation of interest rates softening in 2016-17 amidst a likely improvement in the operating environment should continue to provide opportunities over the next year.

The Banking sector continued to face challenges on the back of challenging operating environment which led to sharp rise in asset quality related concerns and consequently affected the profitability matrices. Though the issuance of Additional Tier I bonds by banks remained muted in 2015-16 with low investor appetite, given the sizeable capital requirements for banks as the regulations with the Basel III regulations, your Company expects the issuance volumes to pick up with improvement in financial performance of banks.

As for the short term issuances, following the slowdown in credit off-take, certificate of deposit (CD) issuances and outstanding declined, along expected lines, during the year under review.

The NBFCs continue to expand their scale of operations while maintaining adequate profitability and asset quality matrices. Your Company continued to expand its presence in this space by adding new clients and also rating the incremental debt requirements of existing clients.

Your Company also continued to expand its presence in the mutual funds space during the year under review by adding more clients to its portfolio of rated mutual fund houses and schemes.

During 2015-16, your Company announced its first grading under the newly launched microfinance social performance assessment (SPA) service. The service seeks to measure the social performance of a microfinance institution (MFI) from an analysis of the manner in which the MFI oversees, manages and monitors its performance in order to achieve its social mission. Your Company believes that an MFI performing better on SPA is better placed not only to positively influence the lives of its customers, but also to be financially sustainable in the long term.

Structured Finance

During 2015-16, the securitisation market rallied back with the issuance volume rising 30% over the previous fiscal to around Rs. 22,000 crore. The predominant motive for banks—primarily domestic private sector banks and foreign banks—to invest in securitization instruments, despite the high tax incidence and the resultant low yield, continued to be the need to meet shortfalls in meeting priority sector lending (PSL) targets. Bilateral assignment of loan pools, the alternative mode for acquisition of retail loan assets by banks, also continued to see robust growth.

Investing in securitization transactions and acquiring loan pools through bilateral assignment—with the underlying assets being eligible loan receivables—continue to be the key routes for banks to meet shortfalls in PSL targets. Thus, going forward, the extent of shortfall in PSL targets in the banking system and the availability of eligible assets with sellers are expected to be the key factors influencing securitisation issuance/assignment volumes. The replacement of the distribution tax regime—which pushed up the effective tax rate to very high levels, thereby bringing down the yield for the investor— with one that makes income from securitisation taxable in the hands of the investor, has also brought relief to investors in securitised debt. This, besides with the opening up of the securitisation market for foreign portfolio investors, bodes well for securitisation issuance volumes in 2016-17.

Industry Research

Your Company has continued to strengthen its research offerings, covering a large number of sub-segments within the corporate sector and multiple sub-segments under the financial services and structured finance sectors. The research reports are well-appreciated for their in-depth analyses of industry-specific issues such as trends in demand-supply, the competitive landscape and credit trends, apart from their projection of the medium-to-long-term outlook. The research reports cater to the analytical requirements of a wide range of participants, including banks, mutual funds, insurance companies, venture funds and corporate entities. Apart from research reports, your Company also provides Industry Risk Scores (IRS) and has increased the coverage of sectors for this service. IRS capture industry-level factors that impact the credit profiles of companies operating in an industry and can be a comprehensive guide for the lending community in its assessment of borrower credit risks.

Besides the periodic off-the-shelf research publications, your Company's customised research offerings to meet the specific requirements of various clients have also been well appreciated. Your Company expects to be able to enhance the offerings under this service, leveraging its extensive knowledge base and research capabilities.

Franchise Development

Your Company continues to make significant efforts to enhance its visibility and reinforce its brand strength through seminars, conferences and media activities aimed at promoting market awareness, bridging the information gap, and recognising excellence.

During the year, in addition to several joint seminars with Moody's Investors Service (Moody's) to disseminate its views on developments in the domestic and global credit markets, your Company launched a few novel initiatives. Your Company, along with Moody's, held two comprehensive credit conferences covering corporate, infrastructure and financial sectors; organised a unique workshop on understanding information technology-related risks in financial institutions; and held a first of its kind joint conference with an academic institution of repute to contribute to the expansion of the Indian fixed-income markets. Titled "Developing India's Fixed Income Markets for Sustainable Growth", this joint conference was held in partnership with Moody's Corporation and Solomon Centre, Stern School of Business, New York University. The conference was the inaugural event for the Moody's ICRA Academic Advisory Panel (MIAAP), established in 2015 to promote research on Indian fixed-income markets and facilitate dialogue between academics, market participants, regulators and others.

Further, your Company's periodic teleconferences, increasing use of research and sectoral reports, were all well appreciated. Apart from these, your Company has been able to attain a substantial share of voice in the media through regular releases voicing our opinion on contemporary issues.

On recognising excellence, your Company continues to power the Financial Advisor Awards along with CNBC-TV18, and the India Pride Awards, an initiative to recognise the superior performing public sector entities, with the Dainik Bhaskar group. These awards have seen an increased level of participation over the years and are a subject of considerable pride for the winners.

Change in nature of business

During 2015-16, there is no change in the nature of business of your Company.

Subsidiary Companies (including step down subsidiaries)

During 2015-16, your Company has dissolved one of its step-down subsidiaries, IMaCS Virtus Global Partners Inc, incorporated in USA. As of March 31, 2016, your Company has the following subsidiaries:

1. ICRA Management Consulting Services Limited, subsidiary

1.1. Pragati Development Consulting Services Limited, step down subsidiary

2. ICRA Techno Analytics Limited, subsidiary

2.1. ICRA Sapphire Inc., step down subsidiary

2.2. ICRA Global Capital Inc., step down subsidiary 2.2.1. BPA Technologies Inc., step down subsidiary 2.2.1.2. BPA Technologies Pvt. Ltd., step down subsidiary

3. ICRA Online Limited, subsidiary

4. PT. ICRA Indonesia, subsidiary

5. ICRA Lanka Limited, subsidiary

6. ICRA Nepal Limited, subsidiary

During 2015-16, your Company, after extensive review of results to-date and in light of continuous losses of PT. ICRA Indonesia (ICRA Indo), discontinued the rating services business activity in Indonesia. During the year under review, ICRA Indo has received the approval of the Indonesian regulator for surrender of its rating license and your Company has initiated the liquidation proceedings of ICRA Indo.

The consolidated financial statements of Group ICRA, consisting of ICRA Limited, its subsidiaries, and step down subsidiaries, for the year 2015-16, which form a part of the Annual Report, are attached. The Auditors' Report on the consolidated financial statements is also attached. In compliance with the relevant provisions of the Companies Act, 2013,

a statement containing the brief financial details in Form AOC-1 as per Rule 5 of the Companies (Accounts) Rules, 2014, of the said subsidiaries is annexed to the consolidated financial statements. The consolidated financial statements have been prepared in accordance with the prescribed Accounting Standards.

As required under the provisions of Section 136 (1) of the Companies Act, 2013, the financial statements, including consolidated financial statements and other documents required to be attached thereto, have been uploaded on the Company's website, www.icra.in Further, your Company has also uploaded on its website the audited financial statements of each of its subsidiary company.

Branches of the Company

Your Company operates its business from its offices in Delhi, Gurgaon, Mumbai, Kolkata, Chennai, Ahmedabad, Bengaluru, Hyderabad, and Pune.

Board meetings held during the year

During the year, five meetings of the Board of Directors were held. The details of the meetings are furnished in the Corporate Governance Report which is attached as Annexure-III to this Report.

Human Resource Development & Training

Human resource development continued to be accorded high priority during the year under review, with emphasis being placed on improving skill, competence and knowledge through regular training and in-house/external professional development programmes. The relation between the employees and the management of your Company remained harmonious during the year. Your Company has a consultative and participative management style, which has facilitated the achievement of its corporate goals. The morale of the employees remained high during the year, resulting in a positive contribution to the progress of your Company.

Employees Stock Option Scheme (ESOS)

Your Company has implemented the Employee Stock Option Scheme 2006 ("the Scheme") in accordance with the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, and in conformity with the resolutions passed by the Shareholders at the Annual General Meetings of the Company held on June 12, 2006, July 29, 2008, and August 12, 2011. Pursuant to the resolution passed by the Shareholders at the Annual General Meeting held on June 12, 2006 for the grant of Options, 9,06,000 equity shares amounting to 9.06% of the equity share capital of your Company have been issued to the ICRA Employees Welfare Trust for grant of Options to the eligible option grantees. Accordingly, the Stock Options have been granted to the eligible option grantees from the said pool of 9,06,000 equity shares in two tranches so far. The first tranche was granted during 2006-07 and the second during 2010-11. The disclosures in terms of Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 read with Regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 is annexed to the Directors' Report (Annexure I). The disclosures in terms of Regulation 14 of Securities Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 are also been available on website of the Company and web-link for the same is <http://icra.in/Files/Content/Disclosures%20on%20ESOPs.pdf>. The Scheme is administered by the ESOS Compensation Committee of the Board of your Company and the ICRA Employees Welfare Trust.

Particulars of Employees

The disclosure under the provisions of Section 197(12) of the Companies Act, 2013, regarding the ratio of the remuneration of each Director to the median employee's remuneration and such other details as specified in Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to the Directors' Report (Annexure II). A statement showing the names and other particulars of the employees drawing remuneration in excess of limits set out in Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure forming part of the Directors' Report.

Having regard to the provisions of Section 136(1) of the Companies Act, 2013, the Directors' Report excluding the information provided in compliance with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is being sent to the members of the Company. The said information is available for inspection at the registered office of the Company during working hours and any member interested in obtaining such information may write to the company secretary and the same will be furnished without any fee.

Corporate Governance

The report of the Board of Directors of your Company on Corporate Governance is presented as a separate section (Annexure III) titled "Corporate Governance Report", which forms a part of the Annual Report. The composition of the Board, the Audit Committee, the Nomination and Remuneration Committee, the Stakeholders Relationship Committee, the Corporate Social Responsibility Committee and other Committees of the Board, number of meetings of the Board, Committees of the Board and other matters are presented in the Corporate Governance Report.

The certificate of the Statutory Auditors of your Company regarding compliance with the Corporate Governance requirements as stipulated in Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015 ("Listing Regulations") is annexed to the Directors' Report.

Management Discussion & Analysis

The Management Discussion and Analysis is annexed to the Annual Report (Annexure IV).

Insider Trading Regulations

Based on the requirements under the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, as amended from time to time, the Code of Conduct for prevention of insider trading is in force in your Company. The Board of Directors of the Company has adopted the Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information in compliance with Chapter IV of the said Regulations and the same has been uploaded on the website of your Company.

Material Changes and Commitments

No material changes and commitments that would affect the financial position of the Company have occurred between the end of the financial year to which the attached financial statements relate and the date of this report. Further, as per the disclosure required under Section 134 of the Companies Act, 2013 read with Rule 8(5) of Companies (Accounts) Rules, 2014, no significant and material orders has been passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future.

Conservation of Energy, Technology Absorption, and Foreign Exchange Earnings and Expenditure

As your Company is not engaged in any manufacturing activity, the particulars relating to conservation of energy and technology absorption, as mentioned in the Companies (Accounts) Rules, 2014, are not applicable to it. However, emphasis is placed on employing techniques that result in the conservation of energy. Details on the foreign exchange earnings and expenditure of your Company appear in the Notes to Accounts.

Directors and Key Managerial Personnel

Pursuant to the provisions of Section 152 of the Companies Act, 2013, and the Articles of Association of your Company, Dr. Min Ye is due to retire by rotation, and being eligible, has offered himself for reappointment.

Proposals for the above appointment forms a part of the Agenda for the forthcoming Annual General Meeting and the resolution is recommended for your approval. The profile of Dr. Min is presented in the Notice of the 25th Annual General Meeting, as required under the Companies Act, 2013, and the Listing Regulations.

During the year under review, the Members of the Company at the Annual General Meeting held on August 13, 2015 approved the appointment of Mr. Arun Duggal, Ms. Ranjana Agarwal, and Ms. Radhika Vijay Haribhakti as Independent Directors. Further, the Members at the said Annual General Meeting approved the appointment of Mr. Robert Scott Fauber and Mr. Thomas John Keller Jr. as Non-Executive, Non-Independent Directors of the Company.

The Members of the Company also approved the reappointment of Mr. Naresh Takkar as Managing Director & CEO for the period of five years w.e.f. July 2, 2015 and approved appointment as Group CEO for the period of five years w.e.f. January 30, 2015.

During 2015-16, the Board of Directors of your Company appointed Mr. Vipul Agarwal as Group Chief Financial Officer and Mr. Amit Gupta as General Counsel and designated them Key Managerial Personnel.

Independent Directors' Declaration

As required under Section 149 (7) of the Companies Act, 2013 read with Schedule IV of Companies Act 2013, the

Company has received a confirmation/declaration from each of the Independent Directors stating that they meet the criteria of independence. The following Non-Executive Directors of the Company are independent in terms of Section 149(6) of the Companies Act, 2013, and the Listing Regulations:

1. Mr. Arun Duggal

2. Ms. Ranjana Agarwal

3. Ms. Radhika Vijay Haribhakti

Extract of the Annual Return

An extract of the Annual Return in Form No.MGT 9 as per Section 92(3) and Rule 12 of the Companies (Management and Administration) Rules, 2014, is annexed with this report (Annexure V).

Directors' Responsibility Statement

As required under the provisions contained in Section 134 of the Companies Act, 2013, your Directors hereby confirm that:

(i) in the preparation of the Annual Accounts for the year ended March 31, 2016, the applicable accounting standards have been followed and there are no material departures from the same;

(ii) the Directors had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that year;

(iii) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities;

(iv) the Directors had prepared the Annual Accounts on a going concern basis;

(v) the Directors had laid down the internal financial controls followed by the Company and that such internal financial controls are adequate and were operating effectively; and

(vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Policy on Directors' Appointment

The Nomination and Remuneration Committee works with the Board to determine the appropriate characteristics, skill and experience that are required of the members of the Board. The members of the Board should possess the expertise, skills and experience needed to manage and guide the Company in the right direction and to create value for all stakeholders. The members of the Board will need to consist of eminent persons of proven competence and integrity and with an established track record. Besides having financial literacy, experience, leadership qualities and the ability to think strategically, the members of the Board of Directors are required to have a significant degree of commitment to the Company and should devote adequate time in preparing for the Board meeting and attending the same. Members of the Board of Directors are required to possess the education, expertise, skills and experience in various sectors and industries needed to manage and guide the Company. The members of the Board are required to look at strategic planning and policy formulation.

The members of the Board should not be related to any Executive or Independent Director of the Company or any of its subsidiaries. They are not expected to hold any executive or independent position in any entity that is in direct competition with the Company. Board members are expected to attend and participate in the meetings of the Board and its Committees, as relevant. They are also expected to ensure that their other commitments do not interfere with the responsibilities they have by virtue of being a member of the Board of the Company. While reappointing Directors on the Board and Committees of the Board, the contribution and attendance record of the Director concerned shall be considered in respect of such reappointment. The Independent Directors shall hold office as a member of the Board for a maximum term as per the provisions of the Companies Act, 2013, and the Listing Regulations. The appointment of Directors shall be formalised through a letter of appointment.

The Executive Directors with the prior approval of the Board may serve on the Board of any other entity if there is no conflict of interest with the business of the Company.

Board and Directors Performance Evaluation

The Board of Directors of the Company based on the recommendations of the Nomination and Remuneration Committee has formulated a Board and Director Performance Evaluation Policy, thereby setting out the performance evaluation criteria for the Board and its Committees and each Directors performance including Chairman of the Company.

Pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations, the Board of Directors has carried out an internal evaluation of its own performance, its Committees, Independent Directors, individual Directors including Chairman of the Company. The exercise of performance evaluation was led by the Chairman of the Company alongwith the Chairperson of the Nomination and Remuneration Committee of the Board.

During 2015-16, the Board devised a process to get anonymous feedback on the functioning and performance of the Board as a whole, Chairperson of the Board, individual Directors, and every Committee of the Board.

The results of the feedback were discussed with the Board. Individual feedback was shared by the Chairman with each Board member separately.

The Board of Directors of the Company believe that the effectiveness of its governance framework can continue to be improved through periodic evaluation of the functioning of the Board as a whole, its Committees and individual Director's performance evaluation.

Auditors

M/s. B S R & Co. LLP, Chartered Accountants, were appointed as Statutory Auditors of your Company, at the 24th Annual General Meeting to hold office until the conclusion of the 28th Annual General Meeting subject to ratification in each Annual General Meeting. The Company has received their written consent and a certificate that they satisfy the criteria provided under Section 141 of the Companies Act, 2013, and that the appointment, if ratified, shall be in accordance with the applicable provisions of the Companies Act, 2013, and the Rules framed there under. The Board of Directors, in terms of Section 139 of the Companies Act, 2013, on the recommendation of the Audit Committee, has recommended ratification of appointment of M/s BSR & Co. LLP, Chartered Accountants as the Statutory Auditors of the Company from the conclusion of the ensuing Annual General Meeting till the conclusion of 26th Annual General Meeting of the Company.

Comments on Auditors' Report

The notes to accounts referred to in the Auditors' Report are self explanatory and do not call for any further comments.

The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.

Transfer to Reserves

Your Company proposes to transfer Rs. 6.15 crore (10% of the Net Profit for the year) to the General Reserve. An amount of Rs. 194.94 crore is proposed to be retained in the Statement of Profit & Loss.

Dividend

The Board of Directors recommends for approval of the Shareholders at the forthcoming Annual General Meeting, payment of dividend of Rs. 25; per Equity Share for the financial year ended March 31, 2016. If the Members approve the dividend at the forthcoming Annual General Meeting, the dividend shall be paid to: (i) all those Members whose names appear in the Register of Members as on August 8, 2016; and (ii) all those Members whose names appear on that date as beneficial owners as furnished by National Securities Depository Limited and Central Depository Services (India) Limited.

Transfer to Investor Education and Protection Fund

The Company sends reminder letters to all Shareholders whose dividends are unclaimed so as to ensure that they receive their rightful dues. Your Company has also uploaded on its website, www.icra.in information regarding unpaid/ unclaimed dividend amounts lying with your Company.

During 2015-16, the unclaimed dividend amount of Rs. 1,45,460 towards the unpaid dividend account of the Company for the financial year 2007-08 was transferred to Investor Education and Protection Fund. The said amounts had remained unclaimed for seven years, despite reminder letters having been sent to each of the Shareholders concerned.

Risk Management Policy

Your Company has formulated a risk management policy to ensure that every effort is made to manage risk appropriately so as to maximize potential opportunities and minimize the adverse effects of risk. The Board and the Audit Committee monitor and review the risk management plan.

Internal Control System and their adequacy

Your Company has an Internal Control System, commensurate with its size, nature of its business and complexities of its operations. The Board of Directors of your Company has adopted policies and procedures for ensuring the orderly and efficient conduct of your Company's business. The Board of Directors of your Company has laid down Internal Financial Controls to provide reasonable assurance with regard to recording and providing reliable financial and operational information, adherence to the Company's policies, safeguarding of assets and prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable information. The Board and the Audit Committee regularly evaluate Internal Financial Controls.

Corporate Social Responsibility

Your Company has constituted a Corporate Social Responsibility (CSR) Committee in accordance with Section 135 of the Companies Act, 2013. The CSR Policy has been devised on the basis of the recommendations made by the CSR Committee. The composition of CSR committee, CSR Policy of the Company, details about the development, implementation of CSR Policy and initiatives taken by the Company during the year as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014, have been annexed to this report (Annexure VI).

Particulars of Contracts or Arrangements with Related Parties

Your Company has entered into contracts or arrangements with its related parties. The related-party transactions are disclosed in the financial statements for the year ended March 31, 2016. There have been no material related-party transactions as per Section 188(1) of the Companies Act, 2013, and the required disclosures of information in Form AOC-2 in terms of Section 188 of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, is annexed to this report (Annexure VII).

Policy on Prohibition, Prevention and Redressal of Sexual Harassment

Your Company has formulated a Policy on Prohibition, Prevention and Redressal of Sexual Harassment of Women at Workplace in accordance with The Sexual Harassment of Women at Workplace (Prohibition, Prevention and Redressal) Act, 2013. The Company has constituted separately for all the branches "Internal Complaints Committee" for prevention and redressal of sexual harassment at workplace. The complaint relating to sexual harassment received by the Company on March 10, 2015 has taken amicably resolved.

Deposits

The Company has not accepted any public deposits and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

Particulars of Loans, Guarantees and Investments

The particulars of loans, guarantees and investments are disclosed in the financial statements for the year ended March 31, 2016.

Vigil Mechanism

Your Company has established a vigil mechanism in compliance with the provisions of Section 177 (9) of the Companies Act, 2013, and Regulation 22(1) of Listing Regulations. The vigil mechanism established provides adequate safeguards against victimization of persons who use such mechanism and make provision for direct access to the Chairperson of the Audit Committee in appropriate or exceptional cases. The Vigil Mechanism / Whistle Blower Policy of the Company has been uploaded on the website of the Company, www.icra.in During the year 2015-16, there were no cases received pertaining to the Whistle Blower policy.

Composition of the Audit of Committee

Your Company has constituted an Audit Committee, the composition of which has been provided in the Corporate Governance Report. During the financial year 2015-16, the Board accepted all the recommendations of the Audit Committee.

Secretarial Audit

The Board of Directors of the Company has appointed M/s. Y.J. Basrar & Co., Company Secretaries (Membership No. FCS 2754), as the Secretarial Auditor of the Company for the financial year 2015-16 in terms of Section 204 of the Companies Act, 2013. The Secretarial Audit Report for financial year 2015-16 has been annexed to this Report (Annexure VIII). The Secretarial Audit Report does not contain any qualifications, reservations or adverse remarks.

Acknowledgements

Your Directors acknowledge the cooperation and assistance received from various institutions, Government agencies, Shareholders and professionals from different disciplines.

Your Directors also wish to place on record their appreciation of the contribution made by the members of staff of your Company.

For and on behalf of the Board of Directors

(Arun Duggal)

Chairman

DIN: 00024262

Place: Gurgaon

Date: May 19, 2016