board's report - virk

LARSEN & TOUBRO INFOTECH LIMITED

BOARD'S REPORT Your Directors have pleasure in presenting the Annual Report along with the Audited Financial Statements of Larsen & Toubro Infotech

Limited for the year ended March 31, 2016.

FINANCIAL RESULTS (Z Million)

Particulars Unconsolidated Consolidated

2014-15 2014-15

Revenue from operations .S5,5 20 47,444.03 58,470.60 49,780.36

Other Income 3,386.06 887.80 2,959.61 915.00 ..__. Total Income 59,081.26 48,331.83 61,430.21 50,695.36 _ Operating Profit 12,669.79 10,436.79 13,315.76 10,959.57

Less: Finance Cost 103.57 104.18 103.57 104.19

Less: Depreciation and amortization 1,034.48 907.30 1,739.52 1,579.40

Profit before extraordinary items and tax 11,531,74 9,425.31 11,472.67 9,275.98

Extraordinary item 93.95

Profit Before Tax (PBT) 11,531.74 9,425.31 11,472.67 9,369.93

Less: Provision for Tax 2,150.43 1,695.69 2,249.61 1,682.77

Profit for the year before minority interest 9,381.31 7,729.62 9,223.06 7,687.16

Minority Interest _My 1.29 _ 1.90

Profit for the year (PAT) 9,381.31 7,729.62 9,221.77 ---N-

7,685.26

Add: Balance brought forward from previous year 13,453 81 11,445.86 14,193.21 12,229.63

Add: Profit and loss account of ISRC on amalgamation 100.58 _ Add: Transfer due to amalgamation (pertaining to period October 17, 2014 to March 31, 2016)

27.35

Balance available for disposal which Directors appropriate as follows:

22,963.05 19,175.48 23,414.98 19,914.89

Less: Depreciation & Deferred tax charged to retained earnings 10.10 10.10

Interim Dividends (excluding tax) 5,467.30 4,805.25 5,467.30 4,805.25

Proposed Dividend* (excluding tax) 441.52 441.52

Tax on Dividends (interim & proposed) 1,106.73 906.32 1,106.73 906.32

Balance to be carried forward 15,947.50 13,453.81 16,399.43 14,193.22

* The Directors recommend payment of final dividend of T2.60 per equity share of Z 1 each on 169,816,188 equity shares.

PERFORMANCE OF THE COMPANY

STATE OF COMPANY AFFAIRS

On unconsolidated basis, revenue from operations and other income for the financial year under review were 59,081.26 Million as against

48,331.83 Million for the previous financial year registering an increase of 22.2%. The profit before tax was 11,531.74 Million and the profit after

tax was 9,381.31 Million for the financial year under review as against 9,425.31 Million and 7,729.62 Million respectively for the previous

financial year. There were no material changes and commitments affecting the financial position of the company, between the end of the financial

year and the date of the report.

On consolidated basis, revenue from operations and other income for the financial year under review were 61,430.21 Million as against

50,695.36 Million for the previous financial year registering an increase of 21.2%. The profit before tax was 11,472.67 Million and the profit after

tax was 9,221.77 Million for the financial year under review as against 9,369.93 Million and 7,685.26 Million respectively for the previous financial

year. There were no material changes and commitments affecting the financial position of the company, between the end of the financial year and the

date of the report.

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SEGMENTAL PERFORMANCE

During the year, the Company had two Business Segments namely, Services Cluster and Industrials Cluster of which contribution to the

revenue was 52.4% (previous year 51.6%) from Services Cluster and 47.6% (previous year 48.4%) from Industrials Cluster, on unconsolidated

basis. On consolidated basis, the contribution to the revenue was 53.9% (previous year 52.8%) from Services Cluster, 46.1% (previous year

47.0%) from Industrials Cluster and 0.0% (previous year 0.2%) from Telecom (PES Discontinued Business).

The detailed segmental performance is referred in Note No. T(9) of the Notes forming part of the unconsolidated financial statements and

T(6) of the consolidated financial statements provided in this Annual Report.

GEOGRAPHICAL PERFORMANCE

The Revenue contribution of the Company from the various Geographies is mentioned herein below:

Unconsolidated

S. N.

1

Geography

68.6%

2014-15

67.5% North America

2 Europe 17.4% 18.6%

3 Asia Pacific 2.1% 2.5%

India 6.1% 4.4%

Rest of the World 5.8% 7.0%

Consolidated

Revenue from continuing Revenue from discontinued Total Revenue

S. N. Geography business business

2014-15 2015-16 2014-15 2015-16 2014-15

1 North America 69.0% 68.6% 69.0% 68.5%

2 Europe 17.4% 17.9% 100.0% 17,4% 18.0%

3 Asia Pacific 2.0% 2.4% 2.0% 2.4%

4 India 5.8% 4.2% 5.8% 4.2%

5 Rest of the World 5 8% 6.9% 5.8% 6.9%

INITIAL PUBLIC OFFERING OF YOUR COMPANY

During the year ended March 31, 2016, your Company had filed Draft Red Herring Prospectus ('DRHP') with the Securities & Exchange Board

of India (`SEBI') for the proposed Initial Public Offer ('IP0') of your company through an Offer for Sale (`the Offer') by Larsen & Toubro Limited. Due to change in the Offer structure and other considerations, the said DRHP was withdrawn on April 11, 2016 and pursuant to the approval

of the IPO Committee, the Company has filed a revised DRHP on April 12, 2016.

CAPITAL EXPENDITURE

On unconsolidated basis, as at March 31, 2016, the gross fixed and intangible assets stood at 8,419.33 Million (previous year

7,910.24 Million) out of which assets amounting to 1,014.19 Million (previous year 1,377.63 Million) were added during

the year.

On consolidated basis, as at March 31, 2016, the gross fixed and intangible assets stood at 14,209.88 Million (previous year

13,379.21 Million) out of which assets amounting to 1,346.97 Million (previous year 2,243.52 Million) were added during

the year.

DIVIDEND

The Directors recommend payment of final dividend of! 2.60 per equity share of 1 each on the share capital.

The total dividend on equity shares including interim dividend and proposed dividend for the year ended March 31, 2016 would aggregate to

5,908.82 Million (previous year! 4,805.25 Million) and outflow towards dividend distribution tax would aggregate to! 1,106.73 Million (previous

year! 906.32 Million).

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TRANSFER TO RESERVES

The Directors do not propose to transfer any amount to reserve.

DEPOSITS

During the year ended March 31, 2016, 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.

PEOPLE

We continue on the journey to make the Company the best place to learn and grow. This year we have laid emphasis on personal

development and growth of our employees, besides focusing on hiring, engaging and retaining key talent. In order to do so, we have

initiated the process of capturing the development needs of employees in our Performance Management System.

The Company has put in efforts to continuously simplify all people policies and make them more current and transparent, by seeking inputs from employees, in order to retain our best talent across the globe and build a pipeline of leaders.

We continue to recruit top talent and also recruit from top Universities. We also focus to foster gender diversity in our recruitment drive.

This year we have launched a program titled - 'Catalyst', to hear the voice of the employees and provide them an opportunity to shape their

workplace.

The Directors express their appreciation to all the employees of the Company for their outstanding contribution to the operations of the

Company during the year.

INFRASTRUCTURE

The Company has been expanding its facilities to keep pace with revenue growth. Emphasis has been on adding capacity in SEZ locations for the new

& incremental business. The new units at Mindspace SEZ- Airoli, Hinjewadi-Pune and DLF SEZ Chennai were made operational during the year ended March 31, 2016. Total capacity at Indian centers stands at 21,585 Seats as on March 31, 2016.

BRANDING

Brand l&T Infotech' has grown steadily across the globe, riding strongly on the value added to its Global clients in terms of enabling them

build innovative business models, enhance operational efficiencies, and creating captivating experiences for their customers. This has significantly

enhanced your Company's visibility across new industry sectors, new prospects, and also with the Analyst Community.

Your Company's ability to solve complex business challenges at the convergence of digital and physical with real-world expertise, leadership in domain and technology, and building the best organization to learn & grow will help create the Company to be No.1 in Client-centricity. This will further enhance your Company's brand value as one of the most recognized IT companies in the world.

QUALITY INITIATIVES

Quality is an all-pervasive commitment of the Company. We translate this commitment into seamless service delivery for our clients. The

vision of improvement in Quality and delivery is driven from top to bottom across the organization. We have added new certifications along

with sustaining existing ones.

The Company was successfully appraised for CMMI SVC Level 5 in September 2015 for Application support and Infrastructure

Management services. The focus for the year was to mature the application support and Infrastructure management services.

Effective tools, techniques and predictive models are built and deployed for estimation and project management decision making. Statistical techniques are deployed for monitoring the key project processes. The Company continues to maintain and is now ready to be re-appraised for CMMI Dev Level 5 in May 2016.

The Company continues to adhere to International quality certifications, namely IS09001:2008, ISO/IEC27001:2013, IS014001:2004 & ISO/

IEC20000-1:2011 through a combined external audit conducted by Bureau Veritas. As per specific client needs and requirements, your

company has sustained the I5AE3402 certification for projects of Insurance domain across Business Units and few specific client engagements.

We continue to deliver value to our clients through continuous improvements and value additions. The company has adopted various

initiatives such as Lean methodology levers and Extreme Automation to optimize delivery execution and improve productivity. These

initiatives are governed and monitored through dashboards and periodic reviews at various levels. On an ongoing basis, we conduct

project level and Leadership level client satisfaction surveys to assess the client expectations. Survey results are analyzed to arrive at action

plans and initiatives to improve client experience.

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CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Board has constituted CSR Committee in terms of the requirements of the Companies Act, 2013. The details relating to the same are given in Annexure H.

The Annual Report on CSR is annexed as Annexure A to this Report. CSR Policy of the Company is available on the Company's website http:// www.Intinfotech.com/aboutus/Corporate_social_responsibility.html.

CORPORATE SUSTAINABILITY

Green Initiative

During the year, the Company achieved United States Green Building Council's LEED - Gold Green Building Certification for Powai office in

February 2016. This project helped in energy and water savings, waste and e-waste streamlining and management, switching to green certified products and consumables, and aiding employee comfort.

Occupational Health Safety Initiative

We achieved BS OHSAS 18001:2007 certification for Powai in December 2015. It is aimed at Occupational Health and Safety of all stakeholders

working in Powai.

DIRECTORS & KEY MANAGERIAL PERSONNEL

A. Appointment/ Re-appointment:

During the year, following appointments were made on the Board:

a. Mr. Sanjay Jalona as the Chief Executive Officer & Managing Director of the Company w.e.f. August 10, 2015 to August 09, 2020. Mr.

Jalona, appointed as an Additional Director, will hold office till the ensuing Annual General Meeting (AGM) and is eligible for appointment.

b. Mr. Arjun Gupta as an Independent Director of the Company w.e.f. October 28, 2015 to October 27, 2020, subject to the approval of the shareholders. Mr. Gupta, appointed as an Additional Director, will hold office till the ensuing AGM and is eligible for appointment.

c. Mr. R. Shankar Raman as a Non-Executive Director of the Company w.e.f. October 28, 2015, subject to the approval of the shareholders.

Mr. Shankar Raman, appointed as an Additional Director, will hold office till the ensuing AGM and is eligible for appointment.

Mr. A. M. Naik, Director of the Company, retires by rotation and being eligible, offers himself for re-appointment at the ensuing Annual General

Meeting of the Company.

The notice convening the AGM includes the proposal for appointment/ re-appointment of Directors.

B. Cessation:

a. Mr. K. R. L. Narasimham ceased to be an Executive Director of the Company w.e.f. April 08, 2015.

b. Mr. Sunil Pande ceased to be an Executive Director of the Company w.e.f. August 26, 2015.

c. Mr. Chandrashekara Kakal ceased to be an Executive Director of the Company w.e.f. August 27, 2015.

d. Mr. V. K. Magapu ceased to be the Managing Director of the Company w.e.f. September 26, 2015.

e. Mr. R. Shankar Raman ceased to be a Director of the Company w.e.f. September 26, 2015.

The Board places on record valuable contribution made by the Directors during their tenure.

C. Key Managerial Personnel:

The following were the changes in the Key Managerial Personnel:

a. Ms. Angna Arora ceased to be the Company Secretary w.e.f. May 08, 2015.

b. Mr. P. S. Kapoor was appointed as Head-Finance & Accounts & Company Secretary w.e.f. May 08, 2015 and was designated as the Chief

Financial Officer. He ceased to be Head-Finance & Accounts & Company Secretary and also the Chief Financial Officer w.e.f. August 26,

2015.

c. Mr. Ashok Kumar Sonthalia was appointed as Head-Finance & Accounts w.e.f. August 26, 2015 and has been designated as the Chief Financial Officer.

d. Mr. Subramanya Bhatt was appointed as the Company Secretary w.e.f. August 26, 2015.

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DIRECTORS' RESPONSIBILITY STATEMENT

The Board of Directors hereby confirm that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed and there has been no material

departure;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on March 31, 2016 and of the profit of the Company

for the year ended March 31, 2016;

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

irregularities;

(iv) the Directors have prepared the annual accounts on a going concern basis; and

(v) 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.

STATUTORY AUDITORS

The Auditors, M/s. Sharp & Tannan, hold office until the conclusion of the ensuing Annual General Meeting. A certificate from them has

been received to the effect that their re-appointment, if made, would be in line with the requirement laid under section 139 & 141 of the

Companies Act, 2013. The Board, based on the recommendation of the Audit Committee, recommends the appointment of M/s. Sharp & Tannan as Auditors of the Company from the conclusion of the ensuing AGM until the conclusion of the next AGM.

The Auditor's Report to the Shareholders does not contain any qualification and therefore does not call for any comments from Directors.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements pursuant to Section 129(3) of the Companies Act, 2013, prepared in accordance with the Accounting

Standards prescribed by the Institute of Chartered Accountants of India, forms part of this Annual Report. The Auditors report to the

shareholders does not contain any qualification, observation or adverse comment.

SECRETARIAL AUDITOR

The Secretarial Audit Report issued by Ms. Naina Desai, Practicing Company Secretary does not contain any qualification and is annexed as

Annexure B to this Report.

DEPOSITORY SYSTEM

As on March 31, 2016, 99.23% of the Company's total paid-up capital representing 168,511,518 shares are in dematerialized form. In view

of the numerous advantages offered by the Depository system, members holding shares in physical mode are advised to avail of the facility of dematerialization from either of the depositories.

CHANGES IN SHARE CAPITAL

During the year, the following changes have occurred in the authorised and the paid-up equity share capital of the Company:

a. The authorised share capital of the Company was sub-divided from 32,750,000 equity shares of! 5 each to 163,750,000 equity shares of!

leach, Consequently, the paid up share capital was also sub-divided from 32,250,000 equity shares of 5 each fully paid-up to 161,250,000

equity shares of! 1 each fully paid-up. The sub-division was effected from June 22, 2015.

b. The authorised share capital was increased from! 163.75 Million divided into 163,750,000 equity shares of 1 each to! 200.00 Million

divided into 200,000,000 equity shares of! leach with effect from June 22, 2015.

c. The authorised share capital was further increased to! 240.00 Million divided into 240,000,000 equity shares of! 1 each, pursuant

to the Scheme of Amalgamation of Information Systems Resource Centre Private Limited with the Company becoming effective from September 21, 2015. However, there was no change in the paid-up share capital pursuant to the scheme.

d. During the year 8,566,188 equity shares were allotted on exercise of the vested options under the employees stock options schemes of

the Company. Hence, the paid-up share capital of the Company increased from! 161.25 Million to! 169.82 Million.

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DISCLOSURES UNDER THE COMPANIES ACT, 2013

1. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of annual return is annexed as Annexure C to this Report.

NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS

The Board of Directors met 6 (six) times during the financial year. The details of the Board meetings and the attendance

of Directors are provided in Annexure H - Report on Corporate Governance Report forming part of this Annual Report.

3. AUDIT COMMITTEE

The Board has constituted the Audit Committee in terms of the requirements of the Companies Act, 2013 and SEBI

(Listing Obligations and Disclosure Requirements) Regulations, 2015. The details relating to the same are given in Annexure H.

In accordance with the requirements of the Companies Act, 2013, the Company has in place a vigil mechanism framework for directors

and employees to report genuine concerns.

4. RELATED PARTY TRANSACTIONS

The Audit Committee and the Board of Directors have approved the Related Party Transactions Policy and all the related party

transactions have been entered in accordance thereof and were in the ordinary course of business and at arm's length. The details of

material contracts or arrangement or transactions at arm's length basis as per Form A0C-2 as per Companies (Accounts) Rules, 2014 is

annexed as Annexure D to this report.

5. SUBSIDIARY/ ASSOCIATE/ JOINT VENTURE COMPANIES

As at March 31, 2016, the Company has 9 subsidiaries including a Joint Venture. There has been no material change in the nature of the

business of subsidiaries.

During the year ended March 31, 2016, the Company subscribed to/acquired equity shares in subsidiary companies as under:

A) Shares acquired:

No. of shares

Larsen & Toubro Infotech Austria GmbH

Equity

L&T Information Technology Spain SL

Equity

N. A.*

50,000

*Note: The amount of investment made by the Company is EURO 35,000 which is also reflected in Annexure E to this report. As per the local regulations in

Austria, the entity being a limited liability company, no share certificate is required to be issued.

13) Equity shares sold/transferred:

C) Performance and Financial Position of each subsidiary/ associate and joint venture companies:

A statement containing the salient features of the financial statement of subsidiaries/ associate/ joint venture companies as per form

AOC-1 is annexed as Annexure E to this Report.

During the year ended March 31, 2016, operations of following subsidiaries were reviewed and a restructuring process was carried out:

AMALGAMATION OF ISRC WITH THE COMPANY

Pursuant to the Scheme of Amalgamation sanctioned by the Hon'ble High Court of Bombay vide its order dated September 04, 2015,

Information Systems Resource Centre Private Limited (ISRC) was amalgamated with the Company with effect from September 21, 2015. The

appointed date for the Scheme was October 17, 2014. Consequently, the entire business, assets, liabilities, duties and obligations of ISRC have

been transferred to and vested in the Company with effect from October 17, 2014.

ISRC was engaged in the business of software services with respect to application development, information technology support and

maintenance services to OTIS Elevator Company, USA and other companies of UTC group and was acquired by the Company on October

16, 2014.

AMALGAMATION OF GDA TECHNOLOGIES LIMITED WITH THE COMPANY

The Board of Larsen & Toubro Infotech Limited and GDA Technologies Limited in their meetings held on October 17, 2014, respectively,

approved the Scheme of amalgamation of GDA Technologies Limited with the Company under Section 391 to 394 of the Companies Act,

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1956. The Hon'ble High Court of Bombay has sanctioned the Scheme of Amalgamation vide its order dated April 01, 2016. The approval

of the Scheme by the Hon'ble High Court of Madras is awaited. The appointed date for the proposed scheme is April 1, 2016.

6. PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN OR SECURITY PROVIDED

The Company has disclosed the full particulars of the loans given, investments made or guarantees given or security provided in the notes forming part of the financial statements provided in this Annual Report.

7. EMPLOYEE STOCK OPTION SCHEMES

The disclosure relating to the Employee Stock Option Schemes of the Company as required under the Companies Act, 2013 and rules made thereunder is annexed as Annexure F to this Report.

Pursuant to the resolution passed by the Board on July 27, 2015 and the shareholders on September 14, 2015, the Company has instituted

the Larsen & Toubro lnfotech Limited Employee Stock Option Scheme, 2015 ("ESOP Scheme, 2015") for issue of options to eligible employees which may result in issue of Equity Shares of up to 8,062,500 equity shares of face value of 1 each. Under the ESOP Scheme 2015, no options have been granted as on the date of this report.

8. COMPANY POLICY ON DIRECTOR APPOINTMENT AND REMUNERATION

The Company has constituted the Nomination and Remuneration Committee (NRC) in accordance with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The details relating to the same are given in Annexure H.

The Committee has formulated a policy on Director's appointment and remuneration including recommendation of remuneration of key managerial personnel and the criteria for determining qualifications, positive attributes and independence of a Director.

9. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received Declaration of Independence from its Independent Directors as stipulated under Section 149(7) of the Companies Act, 2013 confirming that they meet the criteria of Independence.

10. INDEPENDENT DIRECTORS MEETING

The meeting of the Independent Directors was held on January 22, 2016, as per schedule IV of the Companies Act, 2013.

11. COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Board Meetings and Annual General Meetings.

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

Information as per Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 relating to conservation of energy, technology absorption, foreign exchange earnings and outgo is given in Annexure G to this report,

13. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

During the year under review, there were no material and significant orders passed by the regulators or courts or tribunals impacting the going concern status and the Company's operations in future.

CORPORATE GOVERNANCE REPORT

A report on Corporate Governance is annexed as Annexure H to this Report.

ACKNOWLEDGEMENTS

The Directors thank the Company's customers, vendors and academic institutions for their support to the Company. The Directors also acknowledge the support and co-operation from the Government of India and the Governments of various countries, the concerned State Governments and other Government Departments and Governmental Agencies. The Directors appreciate and value the contributions made by every member of the L&T Infotech family globally.

For and on behalf of the Board

Sanjay Jalona R. Shankar Raman Chief Executive Officer & Director

Managing Director (DIN: 00019798) (DIN: 07256786)

Place: Mumbai Date: April 26, 2016

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ANNEXURE A TO THE DIRECTORS' REPORT

Annual Report on Corporate Social Responsibility (CSR) Activities for FY16

1. A brief outline of the Company's CSR policy, including overview of projects or programs proposed to be undertaken and a reference to

the web-link to the CSR policy and projects or programs.

The Company's primary focus is on 'Computer Literacy & Education' for employment as part of its CSR programme which includes, amongst

others, the following verticals:

a) Skills Development & Employability - may include but not limited to programmes covering computer literacy and training programmes

for employability for disadvantaged youth.

b) Education - may include but not limited to support to educational institutions, educational programmes & nurturing talent at various

levels for disadvantaged youth.

c) Educational aids - supporting differently-abled and other students by providing IT infrastructure support for specific programmes.

d) Environment - may include but not limited to programmes for conservation and preservation of environment.

e) Women Empowerment - supporting eligible NGOs with infrastructure and facilitating market reach.

During the period under review, the Company's CSR initiative "1Step" organized several projects in the above thrust areas, as per details given

below. But the most important aspect was level of involvement of CSR team and volunteers at every step of these projects that gives us a

close understanding of the community issues and the goals we are trying to meet. This way of working also allowed us to learn a lot on how

to handle projects. The experience from these interactions would help us when we are scaling up projects in FY17.

IT Skills and Education

Overall we now have 45 locations (12 in FY15) from where we impart computer skills —the primary thrust area. From these 45, 18 centers are

set-up and dedicated for youth for employability. From these centers 1,144 (320 From FY15) youth passed out and 123 who were inclined to

take jobs were placed. The balance 27 computer centers were set up in schools for teaching IT curriculum and covered 3,401 school children

(300 during FY15).

Volunteers and partner NGOs taught Science, English and Maths in additional 11 schools-cum-study covering 17,098 children (3,902 during

FY15). Kindly see Table 1 below.

We have added higher level of IT courses covering popular financial package in India and also value added course on computer hardware and

networking.

We have set up projects in 04FY16 which would scale up during subsequent years and thus take us closer to the target spend

on CSR.

These projects launched in Q4FY16 leverage internet, audio / video technologies, open source software and are based on unique

engagement models including community learning, which are aimed at employment through digital literacy. Further the technology

now allows us to do projects in locations away from our office locations where CSR interventions are needed but are otherwise not

possible. But in such locations we do depend and involve the local community.

Women Empowerment

As part of woman empowerment program we have created infrastructure to generate recurring income for 150 women. We also assisted

2,800 women to generate income throughout the year from sale of their products.

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Total Youth

For Financial Year

— 2015


Visually impaired youth

For visually impaired youth; volunteers record audio books from text books which enables them to access study material through

these audio books. The number of Talking Books recorded so far were 58 (30 in FY15). The audio books reached 4,500 students

who were directly benefitted from it. Volunteers also wrote examination papers of competitive examinations and assisted them in

getting jobs.

Employee volunteering and beneficiaries

During the year 4,576 Volunteers (3,442 in FY15) of 1Step, L&T Infotech employee-volunteering program, participated in all the above

projects. The hours contributed by them were 11,852. Last year we were advised to monitor volunteering hours which we started this year.

1Step projects directly impacted 35,258 (18,282 in FY15) beneficiaries.

Table 1

Particulars

Computer skills Number of computer center locations 12

project t Beneficiaries 620 320

Educational programs covering Science, Maths, and 3,902

English -Beneficiaries

Talking Books for Visually impaired — Number of books

Talking Books for Visually impaired — Number of 4,500

beneficiaries

School

Children.

6

300 —

3,902

30

3,500

Total Beneficiaries

Volunteers

35,258

4,576

18,282

3,442

2. The Composition of the CSR Committee:

(i) Mr. S. N. Subrahmanyan - Chairman

(ii) Mr. Sanjay Jalona - Member

(iii) Mr. M. M. Chitale - Member

3. Average net profit of the Company for last three financial years: 7,473.72 Million

4. Prescribed CSR Expenditure (two per cent of the amount as in item 3 above): 149.47 Million

5. Details of CSR spent during the financial year:

i. Total amount spent for the financial year : 23.45 Million

ii. Amount unspent, if any : 126.02 Million

iii. Manner in which the amount spent during the financial year : attached

6. In case the Company has failed to spend the two per cent of the average net profit of the last three financial years or any part thereof,

the Company shall provide the reasons for not spending the amount in its Board report.

The objective of our CSR Policy is to create a visible impact in the focus areas for the beneficiaries and not just spending the requisite

amount. The Company has made efforts to identify projects in line with its CSR focus areas. However, the Company could not spend the

requisite money as considerable time is taken in evaluating and implementing projects that are closer to beneficiaries.

The Company since last year has been working in collaboration with credible partners and other stakeholders and has identified and

built a pipeline of such projects. .

The implementation of initial batch of projects has begun in Q4Fy16. These projects have the potential to scale up during subsequent

years. Further, we will pick up new projects for implementation from the already identified projects in the pipeline. Together it would

help us in meeting to our target spend on CSR.

7. A responsibility statement of the CSR Committee that the implementation and monitoring of CSR Policy, is in compliance with CSR

objectives and Policy of the Company.

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The CSR Committee hereby affirms that:

• The Company has duly formulated a CSR Policy Framework which includes formulation of a CSR Theme, CSR budget and roles and

responsibilities of the Committee, CSR team formed for implementation of the CSR policy;

• The Company has constituted a mechanism to monitor and report on the progress of the CSR programs;

The activities undertaken by the Company as well as the implementation and monitoring mechanisms are in compliance with its CSR

objectives and CSR policy & its Framework.

S. N. Subrahmanyan

Director &

Chairman — CSR Committee

(DIN: 02255382)

Sanjay Jalona

Chief Executive Officer &

Managing Director

(DIN: 07256786)

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5 (iii) Manner in which the amount spent during the financial year is detailed below:

(in Million)

S.N. CSR Project Sector in Projects or programs Amount Direct Overheads Cumulative Amount spent:

or activity which the 1) Local area or other Outlay expenses Expenditure Direct or through

identified project is 2) Specify the State and (Budget) up to the implementing

covered District where project

was undertaken

project or

programs

wise

reporting

period

agency

1 Computer

Skills

Education Mumbai, Navi Mumbai,

Pune, Maharashtra,

Bangalore, Chennai,

Karnataka and Tamil

Nadu

11.76 6.61 0.39 7.00 Direct, Pratham

NGO

_ 2 Educational Education Mumbai, Navi Mumbai,

Maharashtra, Wai,

Mangaon, Bilaspur,

Chennai, Karnataka,

Chhatisgarh and Tamil

Nadu

13.24 8.53 0.39 8.92 Direct, Adhyayan

NGO, Sevalaya

NGO

3 Women

empowerment

I Women

empowerment

Maharashtra and Tamil

Nadu

3.60 0.89 0.39 1.28 Aarambh NGO,

Sevalaya NGO

4 Environment

projects

Environment

projects

Maharashtra, Karnataka,

Tamil Nadu and Rajasthan

1.70 0.10 - 0.10 Say Trees NGO,

Pariyavaran Shala

NGO

5 Nepal

Earthquake

Relief *

Prime

Minister's

National Relief

Fund

- - 6.15 - 6.15 Direct

TOTAL 30.30 22.28 1.17 23.45

NOTE: * The contribution towards Nepal Earthquake Relief fund includes contribution made by Information Systems Resource Centre Private Limited, which

got amalgamated with the Company with effect from September 21, 2015.

S-486


ANNEXURE B TO THE DIRECTORS' RE lORT

FORM NO. MR-3

SECRETARIAL AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED MARCH 31, 2016

[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule No.9 of the Companies (Appointment and Remuneration Personnel)

Rules, 2014]

To,

The Members,


I have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by

LARSEN & TOUBRO INFOTECH LIMITED (hereinafter called the Company). Secretarial Audit was conducted in a manner that provided me a

reasonable basis for evaluating the corporate conduct/ statutory compliances and expressing my opinion thereon.

Based on my verification of the Company's books, papers, minute books, forms and returns filed and other records maintained by the Company

and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit,

I hereby report that in my opinion, the company has, during the audit period covering the financial year ended on March 31, 2016, complied

with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place

to the extent, in the manner and subject to the reporting made hereinafter.

I have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year

ended on March 31, 2016 according to the provisions of:

(I) The Companies Act, 2013 (the Act) and the rules made thereunder;

(ii) The Securities Contracts (Regulation) Act, 1956 ('SCRA') and the rules made thereunder;

(iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;

(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment,

Overseas Direct Investment and External Commercial Borrowings;

(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (`SEBI Act'), as applicable:-

a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;

b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992; presently, (Prohibition of Insider

Trading) Regulations, 2015;

c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009;

d) The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines,

1999; presently, (Share Based Employee Benefits) Regulations, 2014;

e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;

f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the

Companies Act and dealing with client;

g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; and

h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998;

S-487


(vi) Other specific business/industry related laws that are applicable to the company, viz.

The Information Technology Act, 2000.

The Special Economic Zone Act, 2005.

Policy relating to Software Technology Parks of India and its regulations.

The Indian Copyright Act, 1957.

The Patents Act, 1970.

The Trade Marks Act, 1999.

Indian Telegraph Act.

Telecom Regulatory Authority of India (TRAI)/Department of Telecommunication (DOT) Guidelines.

Other Service Provider Guidelines (Governed by DOT)

I have also examined compliance with the applicable clauses of the following:

i. Secretarial Standards issued by The Institute of Company Secretaries of India.

ii. The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Listing

Agreements entered into by the Company with Stock Exchange(s), if applicable. This is not applicable.

During the period under review the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards, etc.

mentioned above.

I further report that the Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Executive

Directors and Independent Directors. The changes in the composition of the Board of Directors that took place during the period under review

were carried out in compliance with the provisions of the Act.

Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days

in advance, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting

and for meaningful participation at the meeting. Majority decision is carried through while the dissenting members' views are captured and

recorded as part of the minutes.

I further report that, in my opinion, there are adequate systems and processes in the company commensurate with the size and operations

of the company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

I further report that during the audit period the following events! actions have taken place which have a major bearing on the Company's

affairs in pursuance of the above referred laws, rules, regulations, guidelines, standards, etc., like -

(i)

Public/Right/Preferential issue of shares / debentures/sweat equity, etc.—

• The Company in its Board meeting held on June 16, 2015 has taken approval for the Offer for Sale by Larsen & Toubro Limited in

the Initial Public Offer of the Company. Pursuant to the same, the Company had filed its Draft Red Herring Prospectus (DRHP) on

September 28, 2015. Due to change in the Offer structure and other considerations, the said DRHP was withdrawn on April 11,

2016 and the revised DRHP filed on April 12, 2016.

(ii) Redemption / buy-back of securities. — NIL.

(iii) Major decisions taken by the members in pursuance to section 180 of the Companies Act, 2013.— NIL.

(iv) Merger / amalgamation / reconstruction, etc.—

• Amalgamation of Information Systems Resource Centre Private Limited with the Company with effect from September 21, 2015;

• Petitions for sanctioning the Scheme of Amalgamation of GDA Technologies Limited with the Company with Appointed Date being

April 1,2016, admitted with the Hon'ble High Courts of Judicature at Bombay and Madras. The Bombay High Court has approved

the Scheme vide its Order dated April 1, 2016, while the approval from Madras High Court is awaited.

S-488


(v) Foreign technical collaborations— NIL.

(vi) Other Event —

• During FY 2015-16, the Company has filed Form ODI with respect to the investment CAD 171,500 made in October 2005 in Larsen

& Toubro Infotech Canada Limited. Also Annual Performance Reports for the said entity for FY 2005-06 till 2014-15 have been filed.

Compounding application, under FEMA regulation for the above mentioned delay in reporting, to be re-submitted, on receipt of

directions from the Reserve Bank of India;

The Board and the shareholders in their meetings held on June 16, 2015 and June 22, 2015, respectively, had approved the

following:

a) Adopted a new set of Articles of Association of the Company in line with the Companies Act, 2013 and Listing Agreement.

b) Sub-division of face value of equity shares from f 5 to f 1 per share;

c) Increase in Authorised Share Capital from equity share capital of f 163.75 Million to f 200.00 Million of face value

1 per equity share.

• The Authorised share capital of the Company was further increased to f 240.00 Million divided into 240,000,000 Equity Shares off

1 each with effect from September 21, 2015, pursuant to the approval of the the Scheme of Amalgamation of Information Systems

Resource Centre Private Limited with the Company, by the Bombay High Court vide its Order dated September 4, 2015.

NAINA R DESAI Practising Company Secretary

Place: Mumbai

Membership No. 1351

Date: April 20, 2016

Certificate of Practice No.13365

This report is to be read with our letter of even date which is annexed as Annexure A and forms an integral part of this report.

S-489


ANNEXURE A TO THE SECRETARIAL AUDIT REPORT

To,

The Members


Our report of even date is to be read along with this letter.

1) Maintenance of secretarial record is the responsibility of the management of the Company. Our responsibility is to express an opinion

on these secretarial records based on our audit.

2) We have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness of

the contents of the Secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial

records. We believe that the processes and practices, we followed provide a reasonable basis for our opinion.

3) We have not verified the correctness and appropriateness of financial records and Books of Account of the Company.

4) Where ever required, we have obtained the Management representation about the compliance of laws, rules and regulations and

happening of events etc.

5) The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the responsibility of

management. Our examination was limited to the verification of procedures on test basis.

6) The Secretarial Audit report is neither an assurance as to the future viability of the Company nor of the efficacy or effectiveness with

which the management has conducted the affairs of the Company.

NAINA R DESAI

Practising Company Secretary

Place: Mumbai

Membership No, 1351

Date: April 20, 2016

Certificate of Practice No.13365

S-490


ANNEXURE C TO THE DIRECTORS' REPORT

FORM NO. MGT-9 EXTRACT OF ANNUAL RETURN as on the financial year ended on March 31, 2016 [Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS:

1 MIKZEMMIIIIIIIIIIIIIIIIIIIIIIIIIII

CIN U72900MH1996PLC104693

2 Registration Date 23rd December 1996

3 Name of the Company Larsen & Toubro Infotech Limited

Category / Sub-Category of the Company Company limited by shares

Indian Non-Government Company Address of the Registered office and contact details L&T House, Ballard Estate, Mumbai-400001

Tel: +91 22 6776 6138

Email: [email protected] Whether listed Company No

Name, Address and Contact details of Registrar and Transfer Agent,

if any

Link lntime India Private Limited

Address: C-13, Pannalal Silk Mills Compound,

L.B.S. Marg, Bhandup (West),

Mumbai 400078, Maharashtra, India

Tel: +91 22 2594 6970

Fax: +91 22 2594 6969

Email: [email protected]

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY:

All the business activities contributing 10 % or more of the total turnover of the company shall be stated:-

NIC Code of the

Product/ service % to total turnover

of the company S. N. Name and Description of main products! services

1 Computer programming, consultancy and related activities

620

100.00

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES:

S. N. Name and Address of the Company CIN/GLN

Holding/

Subsidiary/ Associate

%of

shares

held

Applicable

Section

Larsen & Toubro Limited L99999MH1946PLC004768 Holding 94.96 2(46) Add: L&T House, N. M. Marg, Ballard Estate, Company

Mumbai-400001

Larsen & Toubro infotech GmbH - Subsidiary 100.00 2(87)

Add: Euro-Asia Business Center, Messe-Allee

_ 2, 0-04356, Leipzig, Germany

Larsen & Toubro Infotech Canada Limited - Subsidiary 100.00 2(87) Add: 2810, Matheson Blvd East, Suite 500,

Mississauga, ON 14W 4X7, Canada

S-491


Holding/

Subsidiary/

Associate

% of Applicable

shares Section held

S. N. Name and Address of the Company

CIN/GLN

4 Larsen & Toubro Infotech LLC

Add: 1220, N. Market St., Suite 806,

Wilmington, DE 19801, Country of New

Castle, United State of America

- Subsidiary 100.00 2(87)

5 L&T Infotech Financial Services Technologies

Inc.

Add: 2810, Matheson Blvd East, Suite 500,

Mississauga, ON L4W 4X7, Canada


6 Larsen And Toubro Infotech South Africa

(Pty) Limited

Add: 6th Floor, 119 Hertzog Boulevard,

Foreshore 8001, South Africa


7 L&T Information Technology Services

(Shanghai) Co., Ltd.

Add: Room 1100m Building 2, No.1388,

Xingxian Road, Jaiding District, Shanghai, China


8 GDA Technologies Limited

Add: No.9-A, Chinthamani Nagar, K. K. Pudur,

Coimbatore-641 038, India

U72200TZ1997PLC008145 Subsidiary 100.00 2(87)

9 Larsen & Toubro Infotech Austria GmbH

Add: c/o Oberhammer Rechtsanwalte GmbH,

Karlsplatz 3/1, 1010 Vienna, Austria


10 L&T Information Technology Spain SL

Add: C/JOSE ABASCAL 56 2nd Floor, Madrid,

Spain


IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

No. of shares held at the beginning of the year No. of shares held at the end of the year

Category Code

(A)

Category of Shareholder(s)

Shareholding of

Promoter and

Promoter Group

No. of shares in

Dematerilised Form

No. of Total No. of % of No. of No. of Total No. of

shares shares Total shares in shares in shares

in Physical Share Dematerilised Physical

Form Form Form

Change % of Total Share during

the year

(1) Indian

(a) Individuals/ Hindu

Undivided Family

0 0 0 0.00 0 0 0 0.00 0.00

(b) Central Government/

State Government(s)

0 0 0 0.00 0 0 0 0.00

94.96 -4_-----

0.00

(5.04) (c) Bodies Corporate 0 32,250,000 32,250,000 100.00 161,250,000 0 161,250,000

(d) Financial Institutions/

'Banks

0 0 0 0.00 0 0 0 0.00 0.00

(e) Others 0 0 0 0.00 0 0 0 0.00 0.00 SUB TOTAL (Al) 0 32,250,000 32,250,000 100.00 161,250,000 0 161,250,000 94.96 (5.04)

S-492


Category Category of Code Shareholder(s)

(2) Foreign

No. of shares held at the beginning of the year No. of shares held at the end of the year % No. of

shares in Dematerilised

Form

No. of shares

in Physical Form

Total No. of shares

% of Total

Share

No. of shares in

Dematerilised Form

No. of shares in Physkal

Form

Total No. of % of Total Change

shares Share during the

year

(a) Individuals (Non-

Residents Individuals/

Foreign Individuals)

0 0 0 0.00 0 0 0 0.00 0.00

(b) Bodies Corporate 0 0 0 0.00 0 0 0 0.00 0.00

(c) Financial Institutions/

Banks

0 0 0 0.00 0 0 0 0.00 0.00

(d) Others 0 0 0 0.00 0 0 0 0.00 0.00

SUB TOTAL (A2) 0 0 0 0.00 0 0 0 0.00 0.00

TOTAL Shareholding

of Promoter and Promoter Group (Al + A2)

0 32,250,000 32,250,000 100.00 161,250,000 0 161,250,000 94.96 (5.04)

(B) Public Shareholding

(1) Institutions

(a) Mutual Funds/ UTI 0 0 0 0.00 0 0 0 0.00 0.00

(b) Financial Institutions

/ Banks

0 0 0 0.00 0 0 0 0.00 0.00

(c) Central Government/

State Government(s)

0 0 0 0.00 0 0 0 0.00 0.00

(d) Venture Capital

Funds

0 0 0 0.00 0 0 0 0.00 0.00

(e) Insurance Companies 0 0 0 0.00 0 0 0 0.00 0.00

(f) Foreign Institutional

Investors

0 0 0 0.00 0 0 0 0.00 0.00

(g) Foreign Venture

Capital Investors

0 0 0 0.00 0 0 0 0.00 0.00

(j) _ Others 0.00 0 0 0 0.00 0.00

SUB TOTAL (B1) 0 0 0 0.00 0 0 01 0.00 _ 0.00

(2) Non - Institutions

(a) Bodies Corporate -+ (i) Indian 0 0 0 0.00 11,049 0 11,049 0.01 0.01

(ii) Overseas 0 0 0 0.00 0 0 0 0.00 .,.

0.00 -

(b) Individuals

(i) Individual

Shareholders holding

nominal share capital

up to Z 1 Lakh

0 0 0 0.00 4,938,210 443,944 5,382,154 3.17 3.17

(ii) Individual

Shareholders holding

nominal share capital

in excess of Z 1 Lakh

0 0 0 0.00 701,250 0 701,250 0.41 0.41

S-493

S. N. Shareholder's Name

No. of Shares

% of total Shares of

the company

No. of Shares

Cumulative Shareholding during the year _


the company

Shareholding at the Beginning of the year

32,250,000 loom I Date wise Increase / Decrease in Promoters Shareholding during the year specifying the reasons for increase / decrease (e.g. allotment / transfer / bonus/ sweat equity etc)

Not Applicable*

161,250,000 94.96

S-494

S. N. Particulars

1 At the beginning of the year

At the End of the year


Category Code

Category of Shareholder(s)

No. of shares in

Dematerilised Form

No. of shares

In Physical Form

Total No. of shares

No. of shares held at

No. of shares in Physical

Form

the end of the year %

Total No. of %of Total Change

shares Share during the

year

% of Total

Share

No. of shares in

Dematerilised Form

(c) Others

(i) Directors and their

relatives

0 0 0 0.00 871,875 0 871,875 0.51 0.51

(ii) Non Resident 0

Repatriates

0 0 0.00 634,824 377,670 1,012,494 0.60 0.60

(iii) Non Resident Non Repatriates

0 0 0 0.00 104,310 158,166 262,476 0.15 0.15

(vi) Foreign Nationals 0 0 0 0.00 0 324,890 324,890 0.19 0.19

SUB TOTAL (B2) 0 0 0 0.00 7,261,518 1,304,670 8,566,188 5.04 5.04

TOTAL Public

Shareholding (B1 + B2)

0 0 0 0.00 7,261,518 1,304,670 8,566,188 5.04 5.04

TOTAL (A+B) 0 32,250,000 32,250,000 100.00 168,511,518 1,304,670 169,816,188 100.00 0.00

(C) Shares held by Custodians and

against which

Depository Receipts

have been issued

0 0 0 0.00 0 0 0 0.00 0.00

SUB TOTAL (C) 0 0 0 0.00 0 0 0 0.00 0.00

GRAND TOTAL 0 32,250,000 32,250,000 100.00 168,511,518 1,304,670 169,816,188 100.00 0.00

Note: The equity shares of the Company have been subdivided from face value of 5 each to leach with effect from June 22, 2015.

i) Shareholding of Promoters

Shareholding at the End of the year

32,250,000

32,250,000

No. of Shares

0.001 161,250,000

0.00 161,250,000


the company

94.96

94.96

% of Shares Pledged/

encumbered to total shares

0.00

0.00

% change in shareholding

during the Year

(5.04)

(5.04)

Larsen & Toubro Limited

Total

100.00

100.00


No. of % of total % of Shares

Shares Shares of

Pledged/

the encumbered

company

to total shares

Note: The equity shares of the Company have been subdivided from face value of 5 each to leach with effect from June 22, 2015.

ii) Change in Promoters' Shareholding: There was no change in the shareholding during the year

LARSEN & TOUBRO 1NFOTECH LIMITED

*Notes:

While there is no change in the shareholding of the Promoter & Promoter Group, there is a change in the percentage of the total

outstanding shares of the Company due to periodic allotment of shares during the financial year 2015-16 pursuant to exercise of Stock

Options by the employees.

fr The equity shares of the Company have been subdivided from face value of 5 each to 1 with effect from June 22, 2015.

iii) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):

S N. For Each of the Top 10 Shareholders

VIJAY KUMAR MAGAPU At the beginning of the year


Cumulative

during Shareholding

the year No. of Shares


the company

No. of Shares

-


the company

- 1 -

Date wise Increase / Decrease in

Shareholding during the year specifying

the reasons for increase! decrease

(e.g. allotment / transfer / bonus /

sweat equity etc): _

25.11.2015 420,000 0.26 420,000 0.26

At the End of the year - 420,000 — 0.25

2 YESH WANT MORESHWAR DEOSTHALEE At the beginning of the year - _ -



the reasons for increase / decrease


sweat equity etc):

15.12.2015 281,250 0.17 281,250 0.17

At the End of the year - 281,250 0.17 _ VINA BADAMI At the beginning of the year - -





sweat equity etc):

05.12.2015 140,000 0.08 140,000 0.08

At the End of the year - 140,000 0.08

4 VIVEK SHANTARAM SHIROOR At the beginning of the year - - - - _





sweat equity etc):

05.12.2015 127,000 0.08 127000 0.08 25.12.2015 (4,000) (0.00) 123000 0.07

18.01.2016 15,000 0.00 138000

—

0.08

At the End of the year - 1,38,000 0.08

5 MAKARAND G DEOLALKAR At the beginning of the year - - -





sweat equity etc):

10.11.2015 128,937 0.08 128,937 0.08

At the End of the year - 128,937 0.08

S-495



Cumulative Shareholding durin the ear

S. N.

6

For Each of the Top 10 Shareholders

SHRINIVASAN VENKATARAMAN At the beginning of the year

No. of Shares


the company

No. of % of total Shares Shares of

the company - . -

_ Date wise Increase / Decrease in Shareholding during the year specifying the reasons for increase / decrease (e.g. allotment / transfer / bonus / sweat equity etc):

15.12.2015 125,000 0.07 125,000 0.07

At the End of the year - - 125,000 0.07 7

_

KAVINDRA SHARMA At the beginning of the year - _ . .

Date wise Increase / Decrease in Shareholding during the year specifying the reasons for increase / decrease (e.g. allotment / transfer / bonus / sweat equity etc):

25.11.2015 75,312 0.05 75,312 0.05

15.12.2015 39,375 0.02 114,687 0.07

At the End of the year - - 114,687 0.07 8 HAE RYONG KONG At the beginning of the year - . _ _

Date wise Increase / Decrease in Shareholding during the year specifying the reasons for increase / decrease (e.g. allotment / transfer / bonus / sweat equity etc):

15.12.2015 111,250 0.07 111,250 0.07

At the End of the year - - 111,250 0.07 9 KASUKHELA SITAPATI RAO At the beginning of the year - _ . _

_ Date wise Increase / Decrease in Shareholding during the year specifying

the reasons for increase / decrease (e.g. allotment / transfer / bonus / sweat equity etc):

15.12.2015 110,500 0.07 110,500 0.07

At the End of the year - - 110,500 0.07 10(l) GOPA KUMAR PERIYADAN At the beginning of the year - _ . .

Date wise Increase / Decrease in Shareholding during the year specifying the reasons for increase / decrease

(e.g. allotment / transfer / bonus / sweat equity etc):

10.11.2015 100,000 0.06 100,000 0.06

At the End of the year - - 100,000 0.06 10 (ii) RAVIKUMAR R THUMMARUKUDY At the beginning of the year - _ . .

Date wise Increase / Decrease in Shareholding during the year specifying

the reasons for increase / decrease (e.g. allotment / transfer / bonus / sweat equity etc):

15.12.2015 100,000 0.06 100,000 0.06

At the End of the year - - 100,000 0.06

S-496


iv) Shareholding of Directors and Key Managerial Personnel:

For Each of the Directors and KMP

Shareholding at the

Beginning of the year

No. of Shares

Cumulative Shareholding during the year

No. of Shares


the company

% of total

Shares of

the company

1 ANILKUMAR MANIBHAI NAIK _

At the beginning of the year - - _

Date wise Increase /Decrease in

_




sweat equity etc):

I 1

_

, 25.11.2015 871,875 0.53 871,875 0.53

_ lAt the End of the year - 871,875 0.51

V. INDEBTEDNESS

Indebtedness of the Company including interest outstanding/accrued but not due for payment

(Z Million)

Particulars Secured Loans Unsecured Deposits Total

Excluding deposits Loans Indebtedness

Indebtedness at the beginning of the financial year:

i) Principal Amount 877.78 1,297.48 - 2,175.26

ii) Interest due but not paid 0.85 0.09 0.94 iii) Interest accrued but not due 1.34 0.13 1.47

Total (i+ii+iii) 879.97 1,297.70 2,177.67

Change in Indebtedness during the financial year:

• Addition 1,300.64 1,055.73 2,356.37 • Reduction 1,898.68 2,088.19 3,986.87

Net Change (598.04) (1,032.46) (1,630.50)

Indebtedness at the end of the financial year:

i) Principal Amount 279.74 265.02 544.76

ii) Interest due but not paid 0.14 - 0.14

iii) Interest accrued but not due 0.86 0.07 0.93 Total (i+ii+iii) 280.74 265.09 545.83

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL (DURING THE FINANCIAL YEAR 2015-16)

A. Remuneration to Managing Director (MD), Whole-time Directors (WTD) and/or Manager:

Name of MD/ WTD/ Manager (Z Million)

Particulars of Remuneration IVIr. V. K. Magapui

Mr. K. R. L.

Narasimharre

Mr. Chandrashekara

Kakar

Mr. Sunil

Rand&

Mr. Sanjay

Jaionas Total

(MD) (WTD) (Chief Operating (WTD) (Chief Executive Amount

Officer & WTD) Officer & MD)

Gross salary: I

(a) Salary as per provisions contained in

section 17(1) of the Income-tax Act, 1961 0.17 10.85 5.33

. ' 19.56 35.91

(b) Value of perquisites u/s 17(2) of

Income-tax Act, 1961 - -

(c) Profits in lieu of salary under section

17(3) of Income-tax Act, 1961 -

---

-

S-497


Name of MD/ WTD/Manager (Z Million)

Particulars of Remuneration

Mr. V. K.

Magapu'

Mr. K. R. 1.

Narasimharn'

Mr. Chandrashekara

KAM' Mr. Sunil

Panded

Mr. Sanjay

/Mona' Total

(MD) (WTD) (Chief Operating (WTD) (Chief Executive Amount

Officer & WTD) Officer & MD 2

_ Stock Option - - - . _ _

3 Sweat Equity - - - - . _

4 Commission:

- as % of profit

- others,

-

- - -

- -

- -

12.32 -

12.32 -

5 Others (please specify): - - .

1. Portion of Advisory fees charged by

Holding Company

7.35 - - 7.35

. -

2. Contribution to Provident Fund &

Superannuation Fund -

- - - 1.73 1.73

Total (A) 7.35 0.17 10.85 5.33 33.61 57.31 Overall Ceiling as per the Act (Z 1,162.98 Million) 10% of Net Profits of the Company

Notes:

1. Mr. V. K. Magapu receives Advisory fees from Larsen & Toubro Limited (Holding Company) and approx. 80% of the fees is charged to the Company. Mr. V.

K. Magapu ceased to be the Managing Director w.e.f. September 26, 2015.

2. Mr. K. R. L. Narasimham ceased to be an Executive Director w.e.f. April 08, 2015.

3. Mr. Chandrashekara Kakal ceased to be an Executive Director w.e.f. August 27, 2015.

4. Mr. Sunil Pande ceased to be an Executive Director w.e.f. August 26, 2015.

5. Mr. Sanjay Jalona was appointed as the Chief Executive Officer & Managing Director w.e.f. August 10, 2015.

B. Remuneration to other directors:

(Z Million)

S. N

1

Particulars of Remuneration

Independent Directors

Fee for attending Board /

Committee Meetings

Commission Others,

please specify Total Amount

Mr. Samir Desai 0.53 3.57 - 4.10 Mr. M. M. Chitale 0.55 - - 0.55 Ms. Vedika Bhandarkar 0.25 0.83 - 1.08 Mr. Arjun Gupta' 0.10 1.41 - 1.51 Total (1) 1.43 5.81 - 7.24 Other Non-Executive Directors

Mr. A. M. Naik - - _ - Mr. R. Shankar Raman' - - . - Mr. S. N. Subrahmanyan - - _ _

Total (2) - - . .

Total (B)=(1+2) 1.43 5.81 . 7.24 Total Managerial Remuneration - 5.81 . .

Overall Ceiling as per the Act (!116.30 Million) 1% of Net Profits of the Company

Notes: 1. Mr. Arjun Gupta was appointed as an Independent Director w.e.f. October 28, 2015.

2. Mr. R. Shankar Raman was appointed as a Non-Executive Director w.e.f. October 28, 2015.

S-498

Key Managerial Personnel

Mr. Ashok

Kumar

Ms. Angna

Arora

Mr.

Subramanya

Mr. P. S. Kapoor

(CFO & Company

C. Remuneration to Key Managerial Personnel other than MD/Manager/VVTD:

•


(Z Million)

Total ont a la

(CFO)'

a

(Company

Secretary)'

ecretary Company

Secretary)4 Amount

1 Gross salary:

(a) Salary as per provisions contained in section 17(1) of

the Income-tax Act, 1961 5.96 3.12 0.66 0.11 9.85

(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 2.42 0.01 0.10 0.00 2.53

(c) Profits in lieu of salary under section 17(3) Income-tax

Act, 1961

- - .

-

2 Stock Option _ - _ 3 Sweat Equity _ -

4 Commission:

- as % of profit

-others,

-

_

_

_ _

Others, please specify:

Contribution to Provident Fund & Superannuation Fund 0.12 0.10 0.08 0.00 0.30 Total (A) 8.50 3.23 0.84 0.11 12.68

Notes:

1. Mr. Ashok Kumar Sonthalia was appointed as Head-Finance & Accounts w.e.f. August 26, 2015 and has been designated as the Chief Financial Officer.

2. Mr. Subramanya Bhatt was appointed as the Company Secretary w.e.f. August 26, 2015.

3. Mr. P. S. Kapoor was appointed as Head-Finance & Accounts & Company Secretary w.e.f. May 08, 2015 and was designated as the Chief Financial Officer. He ceased to be Head-Finance & Accounts & Company Secretary and also the Chief Financial Officer w.e.f.

August 26, 2015.

4. Ms. Angna Arora ceased to be the Company Secretary w.e.f. May 08, 2015.

VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES:

There were no penalties, punishment or compounding of offences during the year ended March 31, 2016.

S-499


ANNEXURE D TO THE DIRECTORS' REPORT

Form AOC-2

Related Party Transactions Statement

Details of material contracts or arrangement or transactions at arm's length basis for the year ended March 31, 2016 are as follows:

Nature of contracts/

arrangements/

transactions

Duration of the

contracts/ arrangements/

transactions

Date(s) of

approval by

the Board,

if any:

Amount

paid as

advances,

if any:

S. N. Name(s) of

the related

party

and nature of

relationship

Salient terms of

the contracts or

arrangements

or transactions

Including the

value, if any:

Amount

(Z in Million)

1 Larsen & Sale of Software & 1 yea r As per Not - 1,073.57 Toubro Limited

(Holding

Company)

Other services /

products

commercial

terms in line

with business

practices and

comparable

with unrelated

parties

Applicable

L&T Purchase of Software & 1 year As per Not 694.17 Technology

Services Ltd.

(Fellow

Subsidiary

Company)

Other services /

products

commercial

terms in line

with business

practices and

comparable

with unrelated

parties

Applicable

For and on behalf of the Board

S-500

Sanjay Jalona Chief Executive Officer & Managing Director (DIN: 07256786)

R. Shankar Raman Director (DIN: 00019798)


ANNEXURE E TO THE DIRECTORS' REPORT

Form AOC-I

(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014)

Statement containing salient features of the financial statement of Subsidiary Companies

(Amount in Million)

I

3

IlBMW Name of

Subsidiary

Reporting

period for the

subsidiary

concerned, if

different from

the holding

company's

reporting period

1 2

GDA Technologies

Limited

31/03/2016

IIIOIIIIIIIIIICIIII 5 6 7 1111:11111111111111111 Larsen & L&T Toubro Information

Infotech Technology Austria Spain SI.' GmbH'

Larsen & Toubro Infotech

GmbH

31/03/2016

Larsen & Toubro Infotech Canada

Limited

31/03/2016

Larsen & Toubro

Infotech LLC

31/03/2016

L&T Infotech financial

Services Technologies

Inc.'

31/03/2016

Larsen And Toubro South

Africa (Pty) Limited

31/03/2016

L&T

Information Technology

Services

(Shanghai) Co. Ltd.

31/12/2015 31/03/2016 31/03/2016

4 Reporting

currency

EUR CAD INR USD CAD ZAR CNY EUR EUR

Exchange rate as

on the last date

of the relevant

Financial year

in the case

of foreign

subsidiaries

75.10 51.02 - 66.38 51.23 4.50 10.20 75.10 75.10

5 Share capital 1.14 0.00 1.68 - 2,799.97 2.67 10.96 2.60 3.65

6 Reserves &

surplus

280.63 100.34 369.07 112.62 471.06 17.98 (5.99) (0.51) (0.61)

7 Total assets 326.23 165.22 H 370.90 118.99 3,782.56 246.78 24.00 2.46 4.15

8 Total Liabilities 44.47 64.88 0.14 6.37 511.53 226.13 19.03 0.37 1.11

9 Investments - - 361.85 - - - -- ---

- - -

10 Turnover 932.70 675.56 - 133.45 2,296.93 564.09 41.58 - -

11 Profit before

taxation

65.03 40.66 19.06 12.47 270.86 8.24 2.16 (0.51) - (0.85)

12 Provision for

taxation

8.26 9.88 0.69 - 77.38 3.08 - - (0.24)

13 Profit after

taxation

56.76 30.78 18.37 12.47 193.48 5.16 2.16 (0.51) (0.61)

14 Proposed

Dividend

- - - - - - - - -

15 % of

shareholding

100.00 100.00 100.00 100.00 100.00 74.90 100.00 100.00 100.00

Notes:

1. Following Subsidiaries are yet to commence business:

a. Larsen & Toubro Infotech Austria GmbH

b. L&T Information Technology Spain SI

2. L&T Infotech Financial Services Technologies Inc. has paid interim dividends amounting to t 486.69 Million

S-501


ANVEXURE F TO THE DIRECTORS' REPORT

Particulars of Employee Stock Option Scheme

(as per section 62(1)(b) read with Rule 12 of Companies (Share Capital and Debentures) Rules, 2014)

A. Employee Stock Ownership Scheme - 2000 (ESOS Plan)*

ESOP Serie 1 Grant Price per share (Z) 5 2

Options Granted' 2,003,262 10,411,787

3 Options Vested _

82,660 340,666

4 _

Options exercised 1,851,855 6,407,483

5 Total number of shares arising as a result of exercise of option 1,851,855 6,407,483

6 Options lapsed 68,747 1,654,198

Exercise price per share (Z) 5 2

Variation of terms of options No variations have been made in the Scheme since the

date of notification of the Companies Act, 2013 i.e. w.e.f.

April 1, 2014.

9 Money realized by exercise of options Z 9.26 Million Z 12.81 Million

10 Total number of options in force:

Vested 82,660 340,666

Unvested _

0 _ 2,009,440

Total 82,660 2,350,106 _

11 Employee wise details of options granted to:

(i) Key managerial personnel (KMP as per Companies Act, 2013):# Nil Nil

(ii) Any other employee who recieves a grant of options in any one

year of option amounting to 5% or more of options granted

during that year:' , ,

Nil

,_...

Nil

(iii) Identified employees granted option, during any one year, equal

to or exceeding 1% of the issued capital (excluding outstanding

warrants and conversions) of the Company at the time of grant

Nil Nil

Notes:

# No stock options were granted to employees during the year ended March 31, 2016.

* The equity shares of the Company have been sub-divided from the face value of 5 per share to face value of! 1 per share we.f. June 22,2015. Consequently, the adjustment of sub-division is made to the options granted, vested and alloted under the ESOP Schemes.

S-502


B. Employee Stock Ownership Scheme - 2006 U.S. Stock Option Sub-Plan*

111111111111 1 I Grant Price USD 2.4

Options Granted' 5,20,400

Options Vested 1,43,650

4 Options exercised 3,06,850

Total number of shares arising as a result of exercise of option 3,06,850

Options lapsed 69,900

7 Exercise price USD 2.4

Variation of terms of options No variations have been made in the Scheme

since the date of notification of the Companies

Act, 2013 i.e. w.e.f. 1st April 2014.

Money realized by exercise of options 47.20 Million

10 Total number of options in force 1,43,650

11 Employee wise details of options granted to:

(i) Key managerial personnel (KMP as per Companies Act, 2013) during

the year'

Nil

(ii) Any other employee who recieves a grant of options in any one year of

option amounting to 5% or more of options granted during that year'

Nil

(iii) Identified employees granted option, during any one year, equal to or

exceeding 1% of the issued capital (excluding outstanding warrants and

conversions) of the company at the time of grant

Nil

Notes:

# No stock options were granted to employees during the year ended March 31, 2016.

* The equity shares of the Company have been sub-divided from the face value of 15 per share to face value of Z 1 per share w.e.f. June 22, 2015. Consequently, the adjustment of sub-division is made to the options granted, vested and alloted under the ESOP Schemes.

S-503


ANNEXURE G TO THE DIRECTORS' REPORT

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS & OUTGO

A. CONSERVATION OF ENERGY

(I)

Steps taken or impact on conservation of energy: The Company's operations are not energy-intensive. However, measures have

been taken to reduce energy consumption in the following manner:

1. Replacement of CFL with LED in passage lift/ Toilet Blocks/ Conference rooms.

2. Replacement of Halogen! Metal halide Street light with LED at Powai, Mahape & Bangalore.

3. Installation of Motion sensors to switch off toilets lights when not used in Powai & Bangalore.

4. Installation of Variable frequency drive for AHUs reduce power consumption when loaded partially.

5. Addition of frigitech solution to improve AC efficiency at Airoli.

6. Installation of Electromiser to reduce lighting power consumption.

7. Implementation of LED lights in new office at Hinjewadi.

8. Reducing AC temperature by 1 degree.

9. Maintaining Unity Power factor.

(ii) Steps taken by the company for utilising alternate sources of energy: The Company's operations being not energy-intensive, no steps have been taken by the Company for utilising alternate source of energy.

(iii) Capital investment on energy conservation equipments: 3.08 Million

B. TECHNOLOGY ABSORPTION

(i) Efforts made towards technology absorption: The Company has expanded its services in next generation technologies under

Digital Solutions and Services group since the consolidation during last financial year. The Company operates Centers of Excellence

in emerging technologies such as Digital Experience, Big Data, Machine / Cognitive Intelligence, Business Process Automation,

Cloud, Internet of Things, Analytics, Mobile etc. and existing technologies which collate, disseminate and spread knowledge to

all employees in the Company. Employees are trained using state of the art methodologies for faster onboarding. The Company

has deployed crowdsourcing platform and social collaboration platform for inviting and processing innovation ideas driving new

technology initiatives and new service lines. The Company has invested in automation and digital framework in areas of Internet

of Things, Big Data, Digital Experience, API Management, Application Lifecycle Management and Infrastructure Management, Test

Automation and Business Process Automation to ensure delivery efficiency with highest quality and reliability for its Customers.

(ii) Benefits derived like product improvement, cost reduction, product development or import substitution: Participation in transformation programs led by emerging digital technologies and new platform based service lines driving alternate revenue

sources. Reduced time to market due to availability of ready frameworks and solutions for faster implementation, productivity

improvement through use of latest proprietary and third party automation frameworks and tools.

(iii) In case of imported technology (imported during the last three years reckoned from the beginning of the financial year): As part of sustained efforts for optimizing operational efficiencies, improving employee engagement and modernizing IT systems and

infrastructure, Company has invested in variety of imported technologies. The details of Technology imported is given below:

Whether the

technology been

fully absorbed

If not fully a

absorption has not taken place, and the

reasons thereof

S.N. Details of Technology imported

Year of

import

Enterprise BI for Analytics and reporting: With

a vision to establishing integrated Information

Management System, Company has implemented BI

solution for dashboard and reporting through IBM

Cognos BI and supported by backed Data warehouse

implemented using Microsoft SQL server 2012.

2014 Fully absorbed

S-504

Year of

import

2015

Whether the

technology been

,fully absorbed

Fully absorbed


If not fully absorbed, areas where


,reasons thereof


Sales automation: Company has embarked Sales

process and productivity improvement through

modernization of its existing Sales engine by

implementing Microsoft Dynamics CRM 2015. This

is currently rolled out for India Sales, providing

significant improvement in user Experience and

Productivity

Fully absorbed Employee Engagement Portal: Company has

adopted SharePoint as enterprise wide collaboration

and knowledge management portal. Company

recently launched in-house developed integrated

"Gamification Engine" to encourage and motivate

associates to contribute to enhance the systems

and build the knowledgebase, and in return earn

chance to win exciting gift vouchers. Company has

also launched an internal video channel leveraging

in-house developed "Media Hub" solution and cloud

based Microsoft Azure media Service.

Unify Program: Company has embarked on

eliminating all point to point integration through

implementation of unified integration platform using

Oracle Fusion middle ware ESB. The initiative also

includes Business Process Automation leveraging

Oracle Fusion Middleware BPM.

2015

2015 Partially absorbed Unify program got started in Jan 2015.

As of now 52 out of total 92 interfaces are

migrated on to ESB platform. By end of Sep

2016, it's planned to migrate all remaining

interfaces onto ESB.

Business process Employee onboarding

is planned to be rolled out by June 2016

on OFMW BPM platform. Few other

critical processes are being identified for

implementing by Mar 2017.

Fully absorbed

6

Human Capital Management: Company has

implemented SAP HCM, thus streamlining its

Current HCM processes. The implementation aims

at providing automation for self-service processes

across HCM operations.

Connexions: New communication & collaboration

platform based on Facebook at Work was launched

for transforming and fostering culture of innovation

and collaboration at workplace.

Microsoft Dynamics AX: Implemented to make ease

of operation in admin process.

Digite SwiftALM: "Compass" initiative is taken up for

implementing specialized product Digite SwiftALM

for Application Lifecycle Management function

as applicable to growing future business needs of

our organization and it's replacing legacy in-house

developed Splice-M application.

2013

2016 Partially absorbed Program Connexions has been recently

launched and is operational across the

organization, it is expected to be fully

absorbed by end of second quarter of FY17.

2015 Fully absorbed

2015 Partially Absorbed Configuration is done for almost all process

lifecycles. It's already implemented for 30%

of projects. It's planned to be implemented

in phases across entire organization by

Dec-2016

S-505

Year of Whether the

import technology been

fully absorbed

2016 Partially absorbed

If not fully absorbed, areas where


reasons thereof

BPC implemented for all corporate services

BEUs. Planned to implement the same for

BUs by Dec 2016.

122.60

244.00



SAP BPC: SAP's Budgeting Planning & Control module

is being implemented for setting up, tracking,

monitoring and controlling annual budgets across

entire organization.

(iv) Research and Development:

a. Specific areas in which R&D carried out by the Company: The Company carries out R&D in areas of latest technologies such as

Machine Learning, Internet of Things, Big Data, Analytics, Mobility, Cloud, Next generation User Experience, Service automation,

Manufacturing Execution Systems, etc.

b. Benefits derived as a result of the above R&D: New opportunity creation through over the horizon technologies, creation of ready

frameworks and solutions for faster time to market, Brand positioning, incubation and creation of new service lines.

c. Future plan of action: Proliferation of enterprise social and crowd sourcing platform for collaborative R&D and Innovation.

Technology Governance across business units for sustainable R&D. Investment in new emerging technologies like Cognitive

Computing, Augment Reality and Virtual Reality, Location Services etc., creation of accelerators and solutions in the areas of Digital

Experience, Natural Language Processing, Internet of Things and others.

d. Total Expenditure on R&D:

(!Million)

NMI Expenditure on R&D

a. Capital

b. Recurring

Total R & D expenditure (a+b)

366.60

C. FOREIGN EXCHANGE EARNINGS AND OUTGO

The Company exports IT professional services mainly to North America, Europe, South Africa, Middle East, Japan, Australia and Singapore.

(Z Million)

Particulars 2015-16 2014-15

Foreign Exchange Earned 52,785.78 45,395.45

Foreign Exchange Used 26,471.20 21,819.13

S-506


ANNEXURE H TO THE DIRECTORS' REPORT

CORPORATE GOVERNANCE REPORT

Your Company derives its values from the rich legacy of fair and transparent governance and disclosure practices followed by the L&T group. In

line with the group philosophy, the Company constantly endeavors to benchmark itself with the best practices in the IT industry. The Company

will continue to focus its resources, strengths and strategies to achieve its vision of becoming a true global leader in software services, while

upholding the core values of excellence, integrity, responsibility, unity and understanding, which are fundamental to the L&T group.

BOARD OF DIRECTORS

As on March 31, 2016, the Board comprises of 8 Directors, of which, 1 Director is Executive, 3 are Non-Executive and 4 are Independent

Directors. The Board is chaired by Mr. A. M. Naik as a Non-Executive Chairman. The Board meets at least, four times during the financial

year and gap between 2 consecutive meetings is not more than 120 days. Additional meetings are held, if deemed necessary to conduct the

business.

During the year ended March 31, 2016 the Board met 6 (Six) times on May 8, 2015, June 16, 2015, July 27, 2015, August 26, 2015, October 28, 2015

and January 22, 2016. The composition of the Board, and Directors' attendance at the Board Meetings held during the year is as follows:

Cat

Attendant

eetings

Mr. A. M. Naik Non-Executive Chairman

Mr. V. K. Magapui Managing Director 4

Mr. S. N. Subrahmanyan Non-Executive Director

Mr. R. Shankar Raman' Non-Executive Director 4

Mr. Sanjay Jalona3 Chief Executive Officer & Managing Director 3

Mr. Chandrashekara Kakal4 Chief Operating Officer & Executive Director 4

Mr. K. R. L. Narasimharns Executive Director 0

Mr. Sunil Pande6 Executive Director 2

Mr. Samir Desai Independent Director

Mr. M. M. Chitale Independent Director

Ms. Ved ka Bhandarkar Independent Director

Mr. Arjun Gupta' independent Director

Note:

1. Mr. V. K. Magapu ceased to be the Managing Director w.e.f. September 26, 2015.

2. Mr. R. Shankar Raman ceased to be a Director w.e.f. September 26, 2015 and was re-appointed as a Non-Executive Director w.e.f.

October 28, 2015.

3. Mr. Sanjay Jalona was appointed as the Chief Executive Officer & Managing Director wet. August 10, 2015.

4. Mr. Chandrashekara Kakal ceased to be an Executive Director w.e.f. August 27, 2015.

5. Mr. K.R.L. Narasimham ceased to be an Executive Director w.e.f. April 8, 2015.

6. Mr. Sunil Pande ceased to be an Executive Director w.e.f. August 26, 2015.

7. Mr. Arjun Gupta was appointed as an Independent Director w.e.f. October 28, 2015.

BOARD COMMITTEES

The Board currently has 5 Committees: 1) Audit Committee; 2) Nomination and Remuneration Committee; 3) Corporate Social Responsibility

Committee; 4) Stakeholders' Relationship Committee and 5) IPO Committee. Your Company has also constituted a Risk Management

Committee which is chaired by a member of the Board and also comprises of Senior Executives such as the Chief Financial Officer amongst its

members. The Board is responsible for constituting, assigning and appointing the members of the Committees.

AUDIT COMMITTEE

During the year, the Audit Committee was re-constituted and as on March 31, 2016 comprises of 2 Independent Directors and 1 Non-Executive

Director as its members. The Chairman of the Committee is an Independent Director. The role, terms of reference, the authority and power of the Audit

S-507


Committee were also amended/ modified to be in conformity with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and

Disclosure Requirements) Regulations, 2015.

During the year ended March 31, 2016, the Audit Committee met 4 (Four) times on May 8, 2015, July 27, 2015, October 27, 2015 and January

21, 2016. The composition of the Committee as on March 31, 2016 is as follows:

Mr. M. M. Chitale Chairman

Independent

Mr. Samir Desai Member

Independent

Mr. S. N. Subrahmanyan' Member

Non-Executive

Note:

(1) Mr. S. N. Subrahmanyan was inducted as a member wet August 26,2015.

(2) Mr. R. Shankar Raman ceased to be Chairman and member wet. July 27, 2015 and August 26, 2015, respectively.

(3) After March 31, 2016 Ms. Vedika Bhandarkar was inducted as a member w.e.f. April 18, 2016.

The terms of reference of the Audit Committee include the following:

1. Oversight of the Company's financial reporting process and the disclosure of its financial information to ensure that the financial

statement is correct, sufficient and credible;

1 Recommendation for appointment, re-appointment and replacement, remuneration and terms of appointment of auditors of the

company;

3. Approval of payment to statutory auditors for any other services rendered by the statutory auditors;

4. Reviewing, with the management, the annual financial statements and auditor's report thereon before submission to the board for

approval, with particular reference to:

a) Matters required to be included in the Director's Responsibility Statement to be included in the Board's report in terms of clause

(c) of sub-section 3 of Section 134 of the Companies Act, 2013;

b) Changes, if any, in accounting policies and practices and reasons for the same;

c) Major accounting entries involving estimates based on the exercise of judgment by management;

d) Significant adjustments made in the financial statements arising out of audit findings;

e) Compliance with listing and other legal requirements relating to financial statements;

f) Disclosure of any related party transactions;

g) Modified opinion(s) in the draft audit report.

5. Reviewing, with the management, the quarterly financial statements before submission to the board for approval;

6. Reviewing, with the management, the statement of uses / application of funds raised through an issue (public issue, rights issue,

preferential issue, etc.), the statement of funds utilised for purposes other than those stated in the offer document / prospectus /

notice and the report submitted by the monitoring agency monitoring the utilisation of proceeds of a public or rights issue, and making

appropriate recommendations to the Board to take up steps in this matter;

7. Review and monitor the auditor's independence and performance, and effectiveness of audit process;

8. Approval or any subsequent modification of transactions of the Company with related parties;

9. Scrutiny of inter-corporate loans and investments;

10. Valuation of undertakings or assets of the company, wherever it is necessary;

11. Evaluation of internal financial controls and risk management systems;

12. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;

S-508

Mr. Samir Desail Chairman Independent

Mr. A. M. Nalk2 Member Non-Executive Chairman

Mr. S. N. Subrahmanyan3 Member Non-Executive

Mr. M. M. Chitalei: Independent mber

ame ector Position in the Committee


13. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority

of the official heading the department, reporting structure coverage and frequency of internal audit;

14. Discussion with internal auditors of any significant findings and follow up there on;

15. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity

or a failure of internal control systems of a material nature and reporting the matter to the board;

16. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to

ascertain any area of concern;

17. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-

payment of declared dividends) and creditors;

18. To establish and review the functioning of the Whistle Blower mechanism;

19. Approval of appointment of the chief financial officer (i.e., the whole-time Finance Director or any other person heading the finance

function or discharging that function) after assessing the qualifications, experience and background, etc. of the candidate; and

20. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee and any other terms of reference as

may be decided by the Board or specified/provided under the Companies Act, 2013 or by the SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015 or by any other regulatory authority.

NOMINATION AND REMUNERATION COMMITTEE

During the year, the Nomination and Remuneration Committee was re-constituted and as on March 31, 2016 comprises of 2

Independent Directors, 1 Non-Executive Director and the Non-Executive Chairman as its members. The Chairman of the Committee

is an Independent Director. The role, terms of reference, the authority and power of the Nomination and Remuneration Committee

were also amended / modified to be in conformity with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and

Disclosure Requirements) Regulations, 2015.

During the year ended March 31, 2016 the Committee met 5 (Five) times on May 8, 2015, July 27, 2015, August 26, 2015, October 27, 2015

and January 22, 2016. The composition of the Committee as on March 31, 2016 is as follows:

Note:

(1) Mr, Samir Desai was appointed as Chairman in place of Mr. M. M. Chitale w.e.f. August 26, 2015.

(2) Mr. A. M. Naik was inducted as a member we.f. August 26, 2015

(3) Mr. S. N. Subrahmanyan was inducted as a member w.e.f. August 26, 2015.

(4) Mr. V. K. Magapu and Mr. R. Shankar Raman ceased to be members w.e.f. August 26, 2015.

Terms of Reference

The terms of reference of the Nomination and Remuneration Committee include the following:

1. Formulation of the criteria for determining qualifications, positive attributes and independence of a director and

recommend to the Board a policy relating to the remuneration of the directors, key managerial personnel and other

employees;

2. Formulation of criteria for evaluation of Independent Directors and the Board of directors;

S-509

Chairman Mr. S. N. Subrahmanyanl

Mr. Sanjay Jalonal Chief Executive Officer & Managing Director

Mr. M. M. Chitale Member Independent

Mr. S. N. Subrahmanyanl Chairman Non-Executive

Ms. Vedika Bhandarkar' Independent Member

Member Chief Executive Officer & Managing Director

Position in the Committee Category e of Director

Mr. Sanjay Jalonai


3. To consider and approve Employee Stock Option Schemes and to administer and supervise the same;

4. Devising a policy on diversity of Board of Directors;

5. Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the

criteria laid down, and recommend to the Board their appointment and removal;

6. To consider whether to extend or continue the term of appointment of the independent director, on the basis of

the report of performance evaluation of independent directors;

7. Performing such other activities as may be delegated by the Board or specified/ provided under the Companies Act, 2013

or by the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 or by any other regulatory authority.

CORPORATE SOCIAL RESPONSIBLITY (`CSR') COMMITTEE

During the year, the CSR Committee was reconstituted and as on March 31, 2016 comprises of 1 Independent Director, 1 Non-Executive

Director and the Chief Executive Officer & Managing Director as its members. The Chairman of the Committee is a Non- Executive Director.

The Committee met once during the year on April 7, 2015.

The composition of the Committee as on March 31, 2016 is as follows:

Note:

(1) Mr. S. N. Subrahmanyan and Mr. Sanjay Jalona were inducted as Chairman and member, respectively w.e.f. August 26, 2015.

(2) Mr. V. K. IVIagpau and Mr. Chandrashekara Kakal ceased to be Chairman and member, respectively w.e.f. August 26, 2015.

Terms of Reference

The terms of reference of the Corporate Social Responsibility Committee include the following:

1. To formulate and recommend to the Board, a Corporate Social Responsibility Policy which shall indicate the activities

to be undertaken by the Company as specified in Schedule VII of the Companies Act, 2013 including any amendments thereto;

2. To recommend the amount of expenditure to be incurred on the CSR activities referred to in the above clause; and

3. To monitor CSR policy of the Company including instituting a transparent monitoring mechanism for implementation of

CSR projects or programs or activities undertaken by the Company.

STAKEHOLDERS' RELATIONSHIP COMMITTEE

During the year, the Company constituted Stakeholders' Relationship Committee which as on March 31, 2016 comprises of a Non-Executive

Director, 1 Independent Director and the Chief Executive Officer & Managing Director as its members. The Chairman of the Committee is a

Non-Executive Director.

The composition of the Committee as on March 31, 2016 is as follows:

Note:

(1) Mr. S. N. Subrahmanyan was appointed as Chairman whilst Ms. Vedika Bhandarkar & Mr. SanjayJalona were inducted as members w.e.f. August 26, 2015.

S-510


(2) Mr. R. Shankar Raman and Mr. V. K. Magapu ceased to be Chairman and member respectively w.e.f. August 26, 2015.

Mr. Subramanya Bhatt, Company Secretary is the Compliance Officer who deals with Shareholders' grievance matters.

There was no meeting of the Stakeholders' Relationship Committee held during the year.

The terms of reference of the Stakeholders' Relationship Committee include the following:

1. To redress grievances of shareholders, debenture holders and other security holders;

2. Investigating complaints relating to allotment of shares, approval of transfer or transmission of shares, debentures or any other

securities;

3. Issue of duplicate certificates and new certificates on split/consolidation/renewal;

4. To consider and resolve grievances related to non-receipt of declared dividends, annual report of the Company or any other documents

or information to be sent by the Company to its shareholders; and

5. Carrying out any other function as may be decided by the Board or specified/ provided under the Companies Act, 2013 or SEBI

(Listing Obligations and Disclosure Requirements) Regulations, 2015 or by any other regulatory authority.

IPO COMMITTEE

IPO Committee was constituted during the year and as on March 31, 2016 comprises of the Non-Executive Chairman as the Chairman of the

Committee, 1 Non-Executive Director and the Chief Executive Officer & Managing Director as its members.

The Committee met 2 (Two) times on August 26, 2015 and September 27, 2015. The composition of the Committee as on March 31, 2016 is

as follows:

JrAlf Mr. A. M. Naik Chairman

Mr. S. N. Subrahmanyani Member

Non-Executive Chairman

Non-Executive

Mr. Sanjay Jalona2 Member

I Chief Executive Officer & Managing Director

Note:

(1) Mr. S. N. Subrahmanyan was inducted ass member wet. August 26, 2015.

(2) Mr. Sanjay Jalona was inducted as a member w.e.f. September 26, 2015.

(3) Mr. V. K. Magapu and Mr. R. Shankar Raman ceased to be members w.e.f. August 26, 2015 and September 26, 2015, respectively.

Terms of Reference

The IPO Committee of the Company was constituted to handle matters related to the IPO of the Company such as the appointment of

various intermediaries including book running lead managers, registrar to the offer, underwriters, legal counsels and bankers to the Offer, to

negotiate, finalise and to execute various agreements such as offer agreement, share and cash escrow agreements and syndicate agreement,

to make applications to statutory and other authorities from time to time, determination of the price band and the offer price and other

aspects related thereto such as settlement of all questions, difficulties or doubts in regard to the Offer and any such matters incidental to the

same.

RISK MANAGEMENT COMMITTEE

The Risk Management Committee as on March 31, 2016 comprises of Mr. S. N. Subrahmanyan, Non-Executive Director as the Chairman and

Mr. Sanjay Jalona, Chief Executive Officer & Managing Director and Mr. Ashok Kumar Sonthalia, Chief Financial Officer as its members. The

majority of members including the Chairman are Board members. The Committee met 3 (Three) times during the year on April 14, 2015, June

18, 2015 and October 27, 2015.

S-511


Terms of Reference

The terms of reference of the Risk Management Committee include the following:

1. Framing, implementing, reviewing and monitoring the risk management plan for the Company;

2. Laying down risk assessment and minimization procedures and the procedures to inform Board of the same;

Oversight of the risk management policy/ enterprise risk management framework (identification, impact assessment, monitoring,

mitigation & reporting);

4. Review key strategic risks at domestic/international, macro-economic & sectoral level (including market, competition, political &

reputational issues);

5. Review significant operational risks; and

6. Performing such other activities as may be delegated by the Board or specified/ provided under the Companies Act, 2013 or by the

SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 or statutorily prescribed under any other law or by any other

regulatory authority.

RISK MANAGEMENT FRAMEWORK

Overview:

Our objective of Risk Management framework is to address risks in a proactive manner to sustain business growth. The Risk Management

framework is established to ensure that the risk that would impact the key business objectives are minimized through continuous risk

identification, assessment, quantification and its mitigation.

Risk Management — Our Approach:

Risk Management Process comprises of the following steps:

1. Risk Identification: Risks that impact the Company's business objectives are broadly classified into Strategic, Business and Operational

risks:

• Strategic: Strategic risks are the risks arising due to the decisions the management makes w.r.t. market, business growth, delivery

model, etc. which can have adverse effect on the business objectives. Ownership of these risks shall be with the Top Management.

• Business: Business risks are the risks which impose uncertainty in profits or danger of loss that could cause business to fail, e.g.

Client preferences, increased competition, etc. Ownership of these risks shall be with Business Heads.

• Operational: Operational risks are the risks arising from people, systems and processes through which the Company operates.

Ownership of these risks shall be with Operations Teams.

2. Risk Analysis and Evaluation: The risks are analyzed in terms of probability of occurrence and magnitude of impact. 'Impact' and

'Probability' determines the 'Severity of Risk' which aids to prioritize the risks and its mitigation action.

3. Risk Mitigation: Based on the 'Severity of Risk', they are prioritized and mitigation action is planned. Accordingly, the risks are avoided,

reduced, transferred or accepted.

• Risk Avoidance: The risks with high severity are avoided by exiting the activities or situations which give rise to such risks.

• Risk Reduction: The risks are reduced with appropriate mitigations plans.

• Risk Transfer: Transfer the total or partial risk to external third party vendor.

• Risk Acceptance: The risks with low severity are accepted where the cost of risk mitigation is higher than the risk exposure.

4. Risk Monitoring and Review: The risks are revisited at defined frequencies to validate whether the existing mitigation controls are

sufficient and whether any new risks are envisaged.

Risk Governance Structure:

The risk governance structure of the Company is headed by Board of Directors who formed the Risk Management Committee ('RMC').

RMC is responsible for framing, implementing and monitoring the Risk Management framework for the Company. The RMC is responsible

for reviewing the risk management plan and ensuring its effectiveness. The Audit Committee has additional oversight in the area of

financial risks and controls. Risk Management Head (`RMH') acts as a nodal point for coordinating risk management activities. RMH also

appraises the Audit Committee with identified risks, its mitigation and effectiveness of mitigation. RMH is supported by Business Heads

who are the Risk Managers and owners to implement the Risk Management framework in their respective Business Units.

S-512

Date and Time

L&T House, Ballard Estate, Mumbai —400 00

L&T House, Ballard Estate, Mumbai —400 001.

L&T House, Ballard Estate, Mumbai —400 001

une 12, 2015 at 10.00 a.m.

September 10, 2014 at 10.00 a.m.

August 26, 2013 at 9.00 a.m.

2014-15

2013-14

2012-13


REMUNERATION OF DIRECTORS

The remuneration of the Directors is based on the Company's size, global presence, its economic and financial position, compensation paid by

peer companies, the qualification of the appointee(s), their experience, past performance and other relevant factors.

The Independent Directors are paid sitting fees of 50,000/- for each Board Meeting and 25,000/- for each Committee Meeting. The details

of remuneration paid / payable to the Directors have been disclosed in Annexure C to the Directors Report.

DETAILS OF SHARES HELD BY NON-EXECUTIVE DIRECTORS AS ON MARCH 31, 2016:

of shares

Mr. A. M. N , 871,875

PERFORMANCE EVALUATION OF BOARD

The Board has voluntarily adopted a formal mechanism for evaluating its performance as well as that of its Committees and individual

Directors, including the Chairman of the Board. The exercise was carried out through a structured evaluation process covering various aspects

such as Board Composition and its structure, its culture, Board effectiveness, Board functioning, information availability, etc. The results were

discussed in the meeting of the Nomination and Remuneration Committee and the Board.

INFORMATION TO DIRECTORS

Systems, procedures and resources are in place to ensure that every Director is supplied, in a timely manner, with precise and concise

information in a form and of a quality appropriate to effectively enable / discharge his / her duties. The Directors are given time to study

the data and contribute effectively to the Board discussions. The Non-Executive Directors through their interactions and deliberations give

suggestions for improving overall effectiveness of the Board and its Committees.

ANNUAL GENERAL MEETINGS

The details of last three Annual General Meetings of the Company are as under:

No Special Resolutions were passed by the shareholders during the past 3 Annual General Meetings.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at Workplace

(Prevention, Prohibition & Redressal) Act, 2013 ('Act'). Internal Complaints Committee VICO has been constituted as per the Act, to redress

the complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this

policy.

The ICC team resolved one complaint filed in March 2015 by taking suitable action. During the year under review there was no case reported

under the Act.

COMPLIANCE MONITORING SYSTEM

The Company believes that statutory compliance has become a catalyst for Corporate Governance and that a good statutory compliance

system has become vital for effective conduct of business operations. As a major portion of the Company's business is conducted abroad,

apart from ensuring compliance with Indian statutes, the Company also has to comply with the statutes of the countries where the Company

has presence.

S-513


Keeping this in mind, the Company has instituted a Compliance Monitoring System. Under this system, a certificate is presented to the

Board every quarter, confirming that the Company has complied with all relevant provisions and requirements of various statutes as they

are applicable to the business of the Company in India and abroad as well as with the contractual obligations binding on the Company. The

certificate to the Board is based on back to back certificates received from various compliance owners representing Business Heads, Overseas

Branches, Subsidiary Companies and other support functions. As regards to the services availed from the professional service providers

engaged in various countries, the Company follows a practice of obtaining compliance certificates from them on quarterly basis.

The Compliance Monitoring System which was rolled out by the Company during the year ended March 31, 2010 in form of the

Compliance Portal is being extensively used by all the Compliance owners. The Compliance portal provides the users a web—based

access with access controls based on a defined authorization matrix. Besides connecting all the compliance owners across time

zones to a common platform, the portal is expected to serve as a repository of the compliance exercise yielding substantial

saving in resources and efforts for tracking compliance going forward.

In order to monitor compliances in a more robust way, the Company has initiated deployment of a third party Compliance tool, with advanced

features & enhanced Compliance checklist.

ADEQUACY OF INTERNAL FINANCIAL CONTROLS

The Company has designed and implemented a process driven framework for Internal Financial Controls ('IFC') within the meaning of the explanation

to Section 134(5)(e) of the Companies Act, 2013. For the year ended March 31, 2016, the Board is of the opinion that the Company has sound IFC

commensurate with the nature and size of its business operations and operating effectively and no material weaknesses exist. The Company has a

process in place to continuously monitor the same and identify gaps, if any, and implement new and/ or improved controls wherever the effect of

such gaps would have a material effect on the Company's operations.

GENERAL SHAREHOLDER INFORMATION

a) Share Transfer System:

The Company's investor services are handled by Link 'mime India Private Limited who are the Company's Registrar and Share Transfer

Agent. The Board has delegated the authority for approving transfer, transmission etc. of the Company's securities to the Transfer

Committee which comprises of the Chief Executive Officer & Managing Director, the Chief Financial Officer and the Company Secretary.

b) Dematerialization Of Shares:

The Company has dematerialized its Equity Shares with NSDL and CDSL and the Company's ISIN is INE214T01019.

The share transfers of dematerialized shares can be made through your Depository Participant.

As on March 31, 2016, 99.23% of the Company's total paid-up capital was held in the dematerialized form with NSDL and CDSL.

The number of shares held in dematerialized and physical mode is as under:

Held in Dematerialized form in NSDL 98.67

Held in Dematerialized form in CDSL 952,581 0.56

Physical 1,,_304,670 0.77

TOTAL 169,816,188 100.00

Members are requested to convert their physical holdings into electronic holdings which will negate risks associated with physical certificates.

Members holding shares in dematerialized form are requested to intimate all changes viz, pertaining to change of address, change in e-mail

id, bank details etc. to their Depository Participants whilst those holding shares in physical form are requested to intimate such changes to

the Company's Registrar and Share Transfer Agent.

S-51 4


c) Address for Correspondence:

Address of the Registrar and Share Transfer Agent Link ntime India Private Limited

C-13, Pannalal Silk Mills Compound, L.B.S. Marg,

Bhandup (West), Mumbai 400078, Maharashtra, India

Tel: +91 22 2594 6970

Fax: +91 22 2594 6969

E-mail: [email protected]

Address of the Compliance Officer Subramanya Bhatt, Company Secretary

Larsen & Toubro Infotech Limited

L&T Technology Center Gate No.5, Saki Vihar Road,

' Powai, Mumbai 400072, Maharashtra, India

Tel: +91 22 6776 6776

IFax: +91 22 2858 1130

E-mail: [email protected]

d) Shareholder Grievances:

The Company has designated an e-mail id viz. [email protected] to enable shareholders to contact incase of any queries/

complaints.

S-515


INDEPENDENT AUDITOR'S REPORT

To the members of Larsen & Toubro Infotech Limited

Report on the standalone financial statements

We have audited the accompanying standalone financial statements of Larsen & Toubro Infotech Limited ('the Company'), which comprise

the balance sheet as at March 31, 2016, the statement of profit and loss, the cash flow statement for the year then ended, and a summary of

the significant accounting policies and other explanatory information.

Management's responsibility for the standalone financial statements

The Company's board of directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 ('the Act') with

respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial

performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the

Accounting Standards specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility

also includes 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 frauds and other irregularities; selection and application of appropriate accounting policies;

making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal

financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the

preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether

due to fraud or error.

Auditor's responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included

in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards

require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the

financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures

selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether

due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of

the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also

includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's

Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone

financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements

give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles

generally accepted in India, of the state of affairs of the Company as at March 31, 2016, and its profit and its cash flows for the year ended

on that date.

Report on other legal and regulatory requirements

1 As required by the Companies (Auditor's Report) Order, 2016 ("the Order") issued by the central government of India in terms of sub-

section (11) of section 143 of the Act, we give in Annexure A a statement on the matters specified in paragraphs 3 and 4 of the Order.

S-516


2 As required by section 143 (3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary

for the purposes of our audit;

(b) in our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination

of those books;

(c) the balance sheet, the statement of profit and loss, and the cash flow statement dealt with by this report are in agreement with

the books of account;

(d) in our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under section 133

of the Act, read with rule 7 of the Companies (Accounts) Rules, 2014;

(e) on the basis of the written representations received from the directors as on March 31, 2016 taken on record by the Board of

Directors, none of the directors is disqualified as on 31 March 2016 from being appointed as a director in terms of section 164 (2)

of the Act;

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating

effectiveness of such controls, refer to our separate report in Annexure B; and

(g) with respect to the other matters to be included in the Auditor's Report in accordance with rule 11 of the Companies (Audit and

Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements — refer note R to

the financial statements;

The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable

losses, if any, on long-term contracts including derivative contracts — refer note T(2)(ii) to the financial statements; and

iii. There are no amounts required to be transferred to the Investor Education and Protection Fund by the Company refer note

7(14) to the financial statements.

Sharp & Tannan

Chartered Accountants

Firm's registration no. 109982W

Firdosh D. Buchia

Partner

Mumbai, 26 April 2016

Membership No. 38332

8-517


ANNEXURE 'A' TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph (1) under 'Report on other legal and regulatory requirements' of our report of even date)

1 (a) The Company is maintaining proper records to show full particulars including quantitative details and situation of all fixed assets.

(b) We are informed that the Company has formulated a programme of physical verification of all the fixed assets over a period of

two years which, in our opinion, is reasonable having regard to the size of the Company and nature of its assets. Accordingly, the

physical verification of the fixed assets has been carried out by management during the year and no material discrepancies were

noticed on such verification.

(c) The title deeds of immovable properties are held in the name of the Company.

2 In our opinion and according to the information and explanations given to us, in respect of loans, investments, guarantees and security

the provisions of section 185 and 186 of the Act have been complied with.

3 (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion,

the Company is generally regular in depositing undisputed statutory dues including provident fund, employees state insurance,

income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues as

applicable with the appropriate authorities. According to the information and explanations given to us, there were no undisputed

amounts payable in respect of provident fund, employees state insurance, income-tax, sales-tax, service tax, duty of customs, duty

of excise, cess and other statutory dues outstanding as at March 31, 2016 for a period of more than six months from the date they

became payable.

(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of

income-tax, sales-tax, service tax, duty of custom, duty of excise or value added tax as at March 31, 2016 which have not been

deposited on account of a dispute pending are as under:

me of the

Statute

, Nature of the disputed dues Amoun

(Z' Million)

Period to which the Forum where disputes

amount relates are pending

Software exports and service income revenue

considered as domestic sales and other classification

disputes

Service tax demand under reverse charge mechanism

on the Agency commission paid in foreign currency

Disallowance of exemption under section 10 A

Disallowance of exemption under section 10 A

11.16 2002-2003

2008-2009 to

2013-2014

2005-2006 and

2008-2009

2006-2007 and

2010-2011

Maharashtra Sales Tax

Tribunal, Mumbai

The Commissioner of

Central Excise (Appeals)

ITAT

Commissioner (Appeals)

Central Sales Tax

and local sales

tax Acts ,

Service tax

Income-tax

Act, 1961

1.99

139.18

45.13

1.21 2010-2011 Disputes regarding calculation of notional interest on

transactions with related party and disallowance of

FTC

Disputes regarding short fall in tax deducted at source

Disputes regarding exclusion of interest income from

section 10A calculation, addition of notional interest

! on transactions with related party and disallowance

of FTC

5.14

3.59

2010-2011 and

2011-2012

2007-2008 and

2008-2009

Deputy Commissioner of

Income Tax (TDS)

Asst. Commissioner Of

Income Tax

Dispute regarding wrong calculation of interest 0.13 2011-2012

*Net of pre-deposit paid in getting the stay/appeal admitted

Deputy Commissioner of

Income Tax

4 According to the records of the Company examined by us and the information and explanations given to us, the Company has not

defaulted in repayment of loans or borrowing to any financial institution, bank, government or debenture holders as at the balance sheet

date.

S-518


5 The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) during the year. In

our opinion and according to the information and explanations given to us, the term loans were applied for the purpose for which they

were taken.

6 During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted

auditing practices in India, and according to the information and explanations given to us, we have neither come across any instances of

material fraud by the Company nor on the Company by its officers or employees, noticed or reported during the year, nor have we been

informed of such case by management.

7 According to the records of the Company examined by us and the information and explanations given to us, the Company

has paid/provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of

section 197 read with schedule V to the Act.

8 According to the records of the Company examined by us and the information and explanations given to us, all transactions with related

parties are in compliance with sections 177 and 188 of the Act and the details have been disclosed in the financial statements as

required by the applicable accounting standards.

9 According to the records of the Company examined by us and the information and explanations given to us, the Company has not

entered into any non-cash transactions with directors or persons connected with them.

10 According to the information and explanations given to us, the Company is not required to be registered under section 45-IA of the

Reserve Bank of India Act, 1934.

11 Paragraphs 3(ii), (iii), (v), (vi), (xii) and (xiv) of the Order are not applicable to the Company.

Sharp & Tannan



Firdosh D. Buchia

Partner



ANNEXURE 'B' TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2(f) under 'Report on other legal and regulatory requirements' of our report of even date)

Report on the internal financial controls under clause (i) of sub-section (3) of section 143 of the Companies Act, 2013 ('the Act')

We have audited the internal financial controls over financial reporting of Larsen & Toubro lnfotech Limited ('the Company') as of March 31,

2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management's responsibility for internal financial controls

The Company's management is responsible for establishing and maintaining internal financial controls based on the internal control over

financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance

Note on Audit of Internal Financial Controls Over Financial Reporting ('the Guidance Note') issued by the Institute of Chartered Accountants

of India ('the CAI'). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that

were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the Company's 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, as required under the Act.


Our responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on our audit. We

conducted our audit in accordance with the Guidance Note and the Standards on Auditing, issued by ICAI and deemed to be prescribed under

section 143(10) of the Act, to the extent applicable, to an audit of internal financial controls, both applicable to an audit of internal financial

S-519


controls and both issued by the !CAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and

perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established

and maintained and if such controls operated effectively in all material respects.

Our audit involved performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial

reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding

of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design

and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor's judgment,

including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company's

internal financial controls system over financial reporting.

Meaning of internal financial controls over financial reporting

A company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability

of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting

principles. A company's internal financial control over financial reporting includes those policies and procedures that: (1) pertain to the

maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance

with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with

authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection

of unauthorised acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Inherent limitations of internal financial controls over financial reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper

management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any

evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control

over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or

procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such

internal financial controls over financial reporting were operating effectively as at March 31, 2016, based on the internal control over financial

reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note issued

by the !CAI.

Sharp & Tannan



Firdosh D. Buchia

Partner



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BALANCE SHEET AS AT MARCH 3/, 2016

CZ Million) , Particulars Note

No. As at

31-03-2015 6 46 al- A666M664 0666666

EOUITY AND LIABILITIES -Shareholders' Funds

Share capital 169 82 161.25 Reserves and surplus 18,462 89 19,093.28

Total Equity 18,632 71 19,254.53 Non-current liabilities

Lo_ag-term borrowings D(I) 138.89_ Deferred tax liabilities (net) 958.53 76484_ Other long-term liabilities Long Term Provisions

E(ii) 1,250 52 538.35 124 29 103.71

2,333.34 857.79 Current liabilities

Short-term borrowings D(ji) 397 53 1,897.48 Current maturities of long-term borrowings D(i) 147.23 138.89 Trade payables Other current liabilities

E(i) E(ii)

3,141.47 2,528.52_ 2,678 38 1,599.53

Short-term provisions 5,049 54 2 791.97 11,414 25 8,956.39

TOTAL EQUITY AND LIABILITIES 32,80.30 29,068.71 ASSETS Non-current assets Fixed assets

Tangible assets 2,649 90 2,617.02 Intangible assets 553 51 755;47 Capital work-in-progress 1_O0, 47.63 Intangible assets under development 187 56 ,195.37

3,391.97 3,615.49 Non-current investments H(i) 3)36.22 3,953.11 Long-term loans and advances 4 249 13 2,387.26

10,797.32 9,955.86 Current assets

67 35 Current investments H(ii) 622.32 Trade receivable 1(i) 10 895.97 10,314.39 Unbilled revenue J(ii) 3,699.69 1A34.59 Cash and bank 1,221.75 1,334.34 Short-term loans and advances 5.698 22 5,407.21

21,582.98 32.380.30

19,112.85 TOTAL ASSETS 29,068„71 Significant accountin_gpolicies Contingent liabilities Commitments (capital and others)

Notes forming part of accounts

As per our report attached SHARP & TAN NAN Chartered Accountants Firm's Registration No. 109982W by the hand of

FIRDOSH D. BUCHIA

Sanjay Jalona

R. Shankar Raman Ashok Kumar Sonthalia

Subramanya Bhatt Partner

Chief Executive Officer

Director Chief Financial Officer

Company Secretary Membership No: 38332

& Managing Director

DIN: 00019798

M. No. F2125 DIN: 07256786

Mumbai

Mumbai

April 26, 2016

April 26, 2016

S-521


STATEMENT OF PROFIT & LOSS FOR THE YEAR ENDED MARCH 31, 2016

(Z Million)

Particulars

INCOME:

Revenue from operations

Other income

Total Income

55,695.20

47,444.03

3,386.06

887.80

59,081.26

48,331.83

EXPENSES:

Employee benefit expenses

Operating expenses

Sales, administration and other expenses

Operating profit

Finance cost

Depreciation on tangible assets

Amortisation of intangible assets

Profit before tax

Tax expense

33,838 37

5,670 62

5,902.48

46,411.47

12,669.79

103.57

37,895.04

10,436.79

28,064.72

4,605.35

5,224.97

104,18

654.60, 659.89

379 88

247.41

1,138.05

1,011.48

11,531.74

9,425.31_

Current tax (net)

1,627.13

523.30

2,150.43

9,381.31

1,602.82

Deferred tax

92.87

1,695.69_

7,729.62 NET PROFIT FOR THE YEAR

EARNING PER EQUITY SHARE

Basic

T(7)

Basic earning per equity share

57.23 47.94

Diluted

Diluted earning per equity share

57.10

45.87

Significant accounting policies

A



FIRDOSH D. BUCHIA Partner Membership No: 38332

Sanjay Jalona Chief Executive Officer & Managing Director DIN: 07256786

R. Shankar Raman Ashok Kumar Sonthalia Director Chief Financial Officer DIN: 00019798

Subramanya Bhatt Company Secretary M. Na. F2125

Mumbai April 26, 2016

S-522



CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2016

(Z Million)

Particulars 2014-15

A 11.16,24110332.

Cash flow from operating activities

Net profit before tax '11,531.74 9,425.31

Adjustments for:

Depreciation and amortisation 1,034 48 907.30

Employees stock options amortised (141 59)

Interest (net) 48.98 38.23 .„_ Unrealised foreign exchange loss (gain) (960.22) (558.20)

(Profit)/loss on sale of current investments (47.94) (119.62)

Dividend received from subsidiary (472.38)

Miscellaneous expenditure amortised/(capitalised) 6.35

(Profit)/Loss on sale of fixed assets 26.82 3.16

Operating profit before working capital changes 11,019.89 9,702.53

Changes in working capital

(Increase)/decrease in trade receivables and unbined revenue (2,838.55) (2,226.73)

(Increase)/decrease in other receivables 21.95 (44.55)

Increase/(decrease) in trade & other payables 2,124.08 1,016.45

(Increase)/decrease in working capital (692.52) (1,254.83)

Cash generated from operations 10,327.37 8,447.70

Direct taxes paid (2,633,61) (2,643.01)

Net cash from operating activities 7,693 76 5,804.69

B. Cash flow from investing activities

Purchase of fixed assets (959.74) (1,114.24)

Sale of fixed assets 149.35 24.99

(Purchase)/sale of current investments 673.25 899.41

Investment in subsidiaries (10 07) (806.96)

Dividend received from subsidiary 472 3,8

Interest received 17 17.99

Net cash used in investing activities 342.42 (978.81)

S-523


CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2016 (Contd.)

( Million)

Particulars 2014-15

C. Cash flow from financing acivities

Proceeds from issue of share capital 69.28

Proceeds from/(repayment) of borrowings _

(1,662 61) 1,040.09

Interest paid (57 89) (56.22)

Dividend paid (5,467 30) (4,805.25)

Tax on dividend paid (1,048 71) (1,125.56)_

Net cash from financing activities (8,167 23) (4,946.94)

Net increase in cash and cash equivalents (131.05) (121.06)

Cash and cash equivalents at 31 March 2015 1,334.34 1,455.40

Increase in Cash and Cash Equivalents on Amalgamation 18.46 _


Notes:

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

in the Companies (Accounting Standards) Rules, 2006.

2 Purchase of fixed assets includes movements of capital work-in-progress during the year.

3 Cash and cash equivalents represent cash and bank balances.

4 Bank balances include revaluation gain of ? 36.70 Mn (Previous year gain 3.44 Mn).

5 Amount of corporate social responsibility related expenses spent during the year in cash 20.79 Mn (Note T (13) (b)).

As per our report attached

SHARP & TAN NAN


Firm's Registration No. 109982W

by the hand of

FIRDOSH D. BUCHIA

Partner Membership No: 38332

Sanjay Jalona

Chief Executive Officer & Managing Director DIN: 07256786

R. Shankar Raman

Director DIN: 00019798

Ashok Kumar Sonthalia

Chief Financial Officer Subramanya Bhatt

Company Secretary M. Na. F2125

Mumbai

Mumbai

April 26, 2016

April 26, 2016

S-524


NOTES FORMING PART OF ACCOUNTS

A. Significant Accounting Policies

1. Basis of accounting

These financial statements have been prepared in accordance with the Generally Accepted Accounting Principles in India ('Indian

GAAP') to comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of

the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013. Further the guidance notes/

announcements issued by the Institute of Chartered Accountants of India (ICAI) are also considered wherever applicable. The

Company maintains its accounts on accrual basis following the historical cost convention.

The preparation of financial statements in conformity with GAAP requires management of the Company to make estimates and

assumptions that affect the income and expense reported for the period and assets and liabilities reported as of the date of the financial

statements. Examples of such estimates include the useful lives of the fixed assets, provision for doubtful debts, future obligations in

respect of retirement benefit plans, etc. Actual results could vary from these estimates.

2. Presentation of financial statements

The balance sheet and the statement of profit and loss are prepared and presented in the format prescribed in the schedule III to the

Companies Act, 2013.

The cash flow statement has been prepared and presented as per the requirements of Accounting Standard (AS) 3 "Cash Flow

Statements". The disclosure requirements with respect to items in the balance sheet and statement of profit and loss, as prescribed in

the schedule III to the Act, are presented by way of notes forming part of accounts along with the other notes required to be disclosed

under the notified Accounting Standards.

3. Revenue recognition

a) Revenue from contracts priced on time and material basis are recognised when services are rendered and related costs are

incurred.

Revenue from services performed on "fixed-price" basis is recognised using the proportionate completion method.

Unbilled revenue represents value of services performed in accordance with the contract terms but not billed.

b) Other income

I. Interest income is accrued at applicable interest rate.

ii. Dividend income is accounted in the period in which the right to receive the same is established.

iii. Other items of income are accounted as and when the right to receive arises.

4. Employee benefits

a) Short term employee benefits

All employee benefits falling due wholly within twelve months of rendering the service are classified as short term employee

benefits. The benefits like salaries, wages, short term compensated absences and performance incentives are recognised in the

period in which the employee renders the related service.

b) Post-employment benefits

i) Defined contribution plan:

The Company's superannuation fund and state governed provident fund scheme are classified as defined contribution plans.

The contribution paid / payable under the schemes is recognised during the period in which the employee renders the

related service.

ii) Defined benefit plans:

The provident fund scheme managed by trust, employees gratuity fund scheme managed by [IC and post-retirement medical

benefit scheme are the Company's defined benefit plans. Wherever applicable, the present value of the obligation under such

defined benefit plans is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes

S-525


NOTES FORMING PART OF ACCOUNTS (Contd.)

each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to

build up the final obligation.

The obligation is measured at the present value of the estimated future cash-flows. The discount rates used for determining

the present value of the obligation under defined benefit plans, is based on the market yields on government bonds as at the

balance sheet date, having maturity periods approximating to the terms of related obligations. Actuarial gains and losses are

recognised immediately in the profit and loss account. In case of funded plans, the fair value of the plan assets is reduced from

the gross obligation under the defined benefit plans to recognize the obligation on net basis.

Gains or losses on the curtailment or settlement of any defined benefit plan are recognised when the curtailment or settlement

occurs. Past service cost is recognised as expense on a straight-line basis over the average period until the benefits become

vested.

(iii) Long term employee benefits:

The obligation for long term employee benefits like long term compensation absences is recognised in the similar manner as

in the case of defined benefit plans as mentioned in (b) (ii) above.

5. Fixed assets

Tangible

Fixed assets are stated at cost less accumulated depreciation.

Intangible

Computer software, internally developed software is capitalised at cost.

6. Leases

Finance lease

Assets acquired under leases where the Company has substantially all the risks and rewards of ownership are classified as finance leases.

Such assets are capitalised at the inception of the lease at the lower of the fair value and the present value of minimum lease payments

and a liability is created for an equivalent amount. Each lease rental paid is allocated between the liability and the interest cost, so as to

obtain a constant periodic rate of interest on the outstanding liability for each period.

Operating lease

Assets acquired under lease where a significant portion of the risks and rewards of ownership are retained by the lessor are classified as

operating leases. Lease rentals are charged to the profit and loss account on accrual basis.

7. Depreciation

Tangible - owned assets

Depreciation on assets has been provided based on useful life prescribed in schedule II to the Companies Act, 2013 except for the

leasehold improvements which is depreciated over the lease period.

Tangible - leased assets

Assets acquired under finance leases are depreciated at the rates applicable to similar assets owned by the Company as there is

reasonable certainty that the Company shall obtain ownership of the assets at the end of the lease term.

• Leasehold land Over the residual period of the lease

Intangible assets

The basis of amortization of intangible assets is as follows:

• Computer software 33.33%

• Intellectual Property Rights (IPR) 33.33%

• Business Rights Over a period of five years

S-526


NOTES FORMAG PART OF ACCOUNTS (Contd.)

Depreciation / amortization on additions / disposals are calculated pro-rata from Ito the month of additions / disposals.

8. Investment

Trade investments comprise investments in subsidiary companies.

Long-term investments including trade investments are stated at cost, less provision for other than temporary diminution in value, if any.

Current investments are stated at the lower of cost or market value, determined on the basis of specific identification.

Investments, which are readily realisable and are intended to be held for not more than one year from the date of acquisition, are

classified as current investments. All other investments are classified as long term investments.

9. Employee stock ownership schemes

In respect of stock options granted pursuant to the Company's stock option schemes, the excess of fair value of the share over the

exercise price of the option is treated as discount and accounted as employee compensation cost over the vesting period.

10. Foreign currency transactions

a) Foreign currency transactions are initially recorded at the rates prevailing on the date of the transaction. At the balance sheet

date, foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried at historical cost

denominated in foreign currency are reported using the exchange rate at the date of the transaction.

Translation of foreign currency transaction of overseas branches is as under:

Revenue items at the average rate for the period;

Fixed assets and investments at the rates prevailing on the date of the transaction; and

• Other assets and liabilities at year end rates

Exchange difference on settlement / year end conversion is adjusted to profit and loss account.

b) Forward contracts other than those entered into to hedge foreign currency risk on unexecuted firm commitments or of highly

probable forecast transactions are treated as foreign currency transactions and accounted accordingly. Exchange differences

arising on such contracts are recognised in the period in which they arise and the premium paid / received is accounted as expense

/ income over the period of the contract. Profit or loss on such forward contracts is accounted as income or expense for the

period.

c) All the other derivative contracts, including forward contracts entered into to hedge foreign currency risks on unexecuted firm commitments and highly probable forecast transactions are recognised in the financial statements at fair value as on the balance

sheet date. In pursuance of the announcement of the Institute of Chartered Accountants of India (ICA!) dated March 29, 2008

on accounting of derivatives, the Company has adopted Accounting Standard 30 for applying the test of hedge effectiveness of

the outstanding derivative contracts. Accordingly, the resultant gains or losses on fair valuation of such contracts are recognised

in the profit and loss account or balance sheet as the case may be.

11. Taxes on income

Tax on income for the current period is determined on the basis of taxable income and tax credits computed in accordance with

the provisions of the Income Tax Act, 1961 and based on the expected outcome of assessments/appeals.

Deferred tax is recognised on timing differences between the income accounted in financial statements and the taxable income for the year,

and quantified using the tax rates and laws enacted or substantively enacted as on the Balance Sheet date.

Other deferred tax assets are recognised and carried forward to the extent that there is a reasonable certainty that sufficient future

taxable income will be available against which such deferred tax assets can be realised.

S-527



12. Borrowing costs

Borrowing costs include interest, commitment charges, finance charges in respect of assets acquired on finance lease and exchange

differences arising from foreign currency borrowings, to the extent they are regarded as an adjustment to interest costs.

13. Provisions, contingent liabilities and contingent assets

Provisions are recognised for liabilities that can be measured only by using a substantial degree of estimation, if

a) the Company has a present obligation as a result of a past event;

b) a probable outflow of resources is expected to settle the obligation; and

c) the amount of the obligation can be reliably estimated

Reimbursement expected in respect of expenditure required to settle a provision is recognised only when it is virtually certain that the reimbursement will be received.

Contingent liability is disclosed in the case of

a) a present obligation arising from a past event when it is not probable that an outflow of resources will be required to settle the obligation; or

b) a possible obligation unless the probability of outflow of resources is remote

Contingent assets are neither recognised nor disclosed.

Provisions, contingent liabilities and contingent assets are reviewed at each balance sheet date.

14. Segment accounting

Segment accounting policies are in line with the accounting policies of the Company. In addition, the following specific accounting

policies have been followed for segment reporting:

i. Segment revenue includes sales and other income directly identifiable with/allocable to the segment.

Expenses that are directly identifiable with/allocable to segments are considered for determining the segment result. Expenditure

which relate to the Company as a whole and not allocable to segments are included under "unallocable corporate expenditure".

iii. Income which relates to the Company as a whole and not allocable to segments is included in "unallocable corporate income".

iv. Fixed assets used and liabilities contracted for performing the Company's business have not been identified to any of the above

reported segments as the fixed assets and services are used interchangeably among segments.

15. Cash flow statement

Cash flow statement is prepared segregating the cash flows from operating, investing and financing activities. Cash flow from operating

activities is reported using indirect method. Under the indirect method, the net profit is adjusted for the effects of:

i. transactions of a non-cash nature

ii. any deferrals or accruals of past or future operating cash receipts or payments and

iii. items of income or expense associated with investing or financing cash flows.

Cash and cash equivalents (including bank balances) are reflected as such in the cash flow statement.

S-528

240.00 240,000,000 guJy shares of! 1 each

(Previous year 32,750,000 of! 5 each)

Issued, paid up and subscribed

169,816,188 equity shares for! 1 each

(Previousiear 32,250,000 of! 5 each)

EQUITY SHARE CAPITAL

163.75 _

169.82 161 25

169.82 161.25



B. Share capital

B(i) Share capital authorised, issued, subscribed and paid up: (Z

As at

31-03-2016

As at

31-03-2015

Authorised:

Notes:

a) The board of directors at their meeting held on June 16, 2015 approved sub-division of the equity shares of face value of 5 each to face value of

1 each. The shareholders approved the sub-division on June 22, 2015 at the extraordinary general meeting.

b) The authorised share capital of the Company was increased by! 36.25 Mn comprising 36,250,000 equity shares of! 1 each at the board meeting

held on June 16, 2015 and approved by the shareholders at the extraordinary general meeting held on June 22, 2015.

c) In accordance with the order of the Hon'ble High Court of Judicature at Bombay for amalgamating Information Systems Research Centre Private

Limited (refer note T(7)), the authorised share capital of the Company was increased by! 40.00 Mn comprising 40,000,000 equity shares of! 1

each on amalgamation.

B(ii) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of! 1 per share. Each holder of equity shares is entitled to one vote

per share. The Company declares and pays dividend in Indian rupees.

BOO Shareholders holding more than 5% of equity shares as at the end of the year:

Name of shareholder

As at 31-03-2016

As at 31-03-2015

Number of shares* Shareholding % Number of shares** Shareholdin %

Larsen & Toubro Limited 161,250,000 94.96% 32,250,000 100%

* Face value of 1

** Face value of 5

B(iv) Reconciliation of the number of equity shares and share capital

Due to allotment of shares on exercise of stock options by employees, there was a movement in share capital for the year ended

March 31, 2016.

Issued, subscribed and fully paid up equity shares outstandinj at the beginning

Add: shares issued on exercise of employee stock options

Issued, subscribed and fullypaid up equity shares outstanding at the end

As at

31-03-2016

161,250,000

8,566,188

169,816,188 161,250,000

As at

31-03-2015

161,250,000

B(v) Shares reserved for issue under options outstanding as at the end of the year on un-issued share capital:

Particulars As at 31-03-2016 As at 31-03-2015

Exercise price *Number of equity

shares to be issued

as fully paid

82,660

Exercise price

5

-r-

** Number of'

equity shares to be

issued as full • aid

# Employee stock options granted and 393,003 25

outstanding under Employee Stock Ownership

Scheme "ESOS Plan" 2,350,106 2 1,873,467 10

Employees Stock Ownership Scheme — 2006

U.S. Stock Option Sub-Plan ('Sub-Plan') 143,650 $2.4 90,100 $12

IS Refer note no.B(ix)

* Face value of 1

** Face value of 5

S-529



B(vi) The aggregate number of equity shares allotted as fully paid up by way of bonus shares in immediately preceding five years ended March

31, 2016 are Nil (previous period of five years ended March 31, 2015- Nil)

B(vii)The aggregate number of equity shares issued pursuant to contract, without payment being received in cash in immediately preceding

five years ended March 31, 2016— Nil (previous period of five years ended March 31, 2015 - Nil)

B(viii)(a) During the year ended March 31, 2016, the amount of interim dividend distributed to equity shareholder was! 32.65 per share at face value of 1 (Previous year! 149 per share at face value of! 5)

(b) The Directors recommended payment of final dividend of Z2.60 per equity share of! 1 each on the number of shares outstanding

on the record date.

Provision for final dividend has been made in the books of account for 169,816,188 equity shares outstanding as at March 31, 2016

amounting to! 441.52 Mn.

B(ix) Stock option plans

1. Employee Stock Ownership Scheme ('ESOS Plan')

Under the Employee Stock Ownership Scheme (ESOS) 2,432,766 options are outstanding as at March 31, 2016. The grant of

options to the employees under ESOS is on the basis of their performance and other eligibility criteria. Each option entitles the

holder to exercise the right to apply for and seek allotment of one equity share of! 1 each.

All vested options can be exercised on the first exercise date. The Nomination & Remuneration Committee had decided September

28, 2015 as the first exercise date. The details of the grants under the aforesaid scheme are summarised below:

ESOP Series 1,11 & Ill IV-XXI

2014-15 2014-15

1 Face value (Z) 5

Grant Price (Z) 25 10

Options granted and outstanding at the

__ beginning of the year 1.,965,0ir., 393,003 9,367,335 1,880,484

4 Options reinstated during the year * 3,500 454,580

5 _

Options granted during the year

6 Options cancelled/ lapsed during the year _ 34,000 1,064,326 7,017

7 Options exercised and shares allotted during

the year 1,851,855 6,407,483

8 Options granted and outstanding at the end

of the year of which - , _82,660 393,003 2,350,106 1,873,467_

Options vested 82,660 393,003 340,666 970,917

Options yet to vest 2,009,440 902,550

* The Company had lapsed unvested options with the employees who had resigned from the Company. Based on the legal advice, the Company has exercised its discretion in determining that the former employees in the United States will be allowed to exercise their deferred options

and accordingly, 268,080 options at face value of! 1 (51,616 options at face value of! 5) exercisable by such former employees have been re-

instated and vested.

*The Company had erroneously lapsed 200,000 options at face value of 1 140,000 options at face value of Z5). Subsequently, the Company has

decided that these options be restored and vested.

S-530


NOTES FOCWING PART OF ACCOUNTS (Contd.)

2. Employees Stock Ownership Scheme — 2006 U.S. Stock Option Sub-Plan (`Sub-Plan')

The Company had instituted the Employees Stock Ownership Scheme — 2006 U.S. Stock Option Sub-Plan ('Sub-Plan') for the

employees and Directors of its erstwhile subsidiary, GDA Technologies Inc, USA. The term of option was 5 years from the date

of grant. As per vesting schedule, the options had to vest over a period of five years, subject to fulfilment of certain conditions

specified in the respective Option agreement. Each option entitles the holder to exercise the right to apply for and seek allotment

of one equity share of 1 each at an exercise price of USD 2.4 per share. Under the said plan, options granted and outstanding as

at the end of the year are 143,650 options, all of which are vested.

3. Employees Stock Options granted and outstanding as at the end of the year on unissued share capital represent options 2,576,416

(previous year 11,782,850) at face value of 1.

C. Reserves & surplus

(!Million)

016 As at 31-03-2015 D.Ratan.A0.1.1111•MM060081M1080,

C(i) General reserve

As per last balance sheet 4,485 78

56 4

4,486.78 Add: general reserve of ISRC on amalgamation {refer note T (11)}

Less: amalgamation adjustment {refer note T (11)) (771 96)

Add: transferred from employee stock options outstanding 005

3,771.27 _

4,486.78 C(ii) Capital reserve

As per last balance sheet

0.42 Add: capital reserve of ISRC on amalgamation {refer note T (11)}

0.42

C(iii) reserve (net of tax) _Hedging (366 96)

(2,328 06)

Opening balance (2,923.11) Deduction/(Addition) during the year (net 2,556.15

(2,695.02) (366.96)

C(iv) Securities premium account 1,181 24 Opening balance 1,181.24

Addition during the year 204 16

1,385 40 1,181.24

C(v) Surplus statement of profit and loss

Opening balance 13,453 81 11,445.86 Add: profit and loss account of ISRC on amalgamation {refer note T (11)) 100 58

Add: transfer due to amalgamation (pertaining to period 17 October 14 to 31

March 2015 {refer note T(11)} 27.35

Add: Profit for the year _9,381.31

-

-

7,729.62

Less: Depreciation charged against retained earnings (12.27)

Add : Deferred tax charged against retained earnings 2.17

22,963.05 19,165.38 Less: Appropriations

441.52 (a) Proposed dividend

(b) Interim dividend 5,467.30

1,048,71

58.02

4,805.25_

(c) Tax on dividend 906.32

(d) Additional tax on dividend

15,947.50

338,41

13,453.81 C(vi) Employee stock options outstanding

As per last balance sheet 338.41

Less : deductions during the year (285.04)

Less: transferred to general reserve (0.05)

53.32 338.41 RESERVES & SURPLUS 18,462.89 19,093.28

S-531



D. Borrowings

(Z Million)

As at 31-03-2016 As at 31-03-2015

Non-current Current Total Non-current Current Total

D(i) Long-term borrowings

Secured loans*

Term loans from bank

Refer note D(iii) 147.23 147.23 138.89 138.89 277.78

147.23 147.23 138.89 138.89 277.78

D(ii) Short-term borrowings

Secured loans *

Other loans from banks 132,51 132.51 600.00 600.00

Unsecured loans

Other loans from banks 265.02 265.02 1,297.48 1,297.48

397.53 397.53 1,897.48 1,897.48

Total 544.76 544.76 138.89 2,036.37 2,175.26

* The secured loans from banks are secured against hypothecation of the Company's movable assets and accounts receivables.

Details of term loans

Rate of interest

USD LIBOR

(3 months) + 2.5%

Nature of term loan Million

147.23

Terms of repayment of term loan

Repayable in equal half-yearly instalments of USD 1.11 million

each commencing from 19 October 2012 and ending on 14

October 2016.

External commercial

borrowings (ECB)

Previous Year (277.78)

E. Liabilities

(Z Million)

. . .

Current

.

Non-current Total Non-current Current , Total

E(i) Trade payables

Due to holding company - - - - 174.23 174.23

Due to others 3,141.47 3,141.47 - 2,354.29 2,354.29

3,141.47 3,141.47 - 2,528.52 2,528.52

E(ii) Other payables Forward contract payable 1,148.52 1,574.11 2,722.63 447.46 89.22 536.68

Interest accrued but not due

on borrowing,s_ 1.08 1.08 - 2.41 2.41

Unclaimed dividend - 0.62 0.62 - -

Other payables 102.00 1,102.57 1,204.57 90.89 1,507.90 1,598.79

1,250.52 2,678.38 3,928.90 538.35 1,599.53 2,137.88

Total . _ 1,250.52 5,819.85 _ 7,070.37 538.35 4,128.05 4,666.40

S-532



F. Provisions

(T Million)

Non-current

As at 31-03-2016

Current Total

As at 31-03-2015

--

Non current - r -

Current Total

F(i) Provisions for employee

benefits

Gratuity 86.76 86.76 92.42 92.42

Compensated absences 507.16 507.16 453.57 453.57

Post-retirement medical

benefits 124.29 0.24 124.53 103.71 0.24 103.95

Others - 3,945.24 3,945.24 2,235 04 2,235.04

124.29 4,539.40 4,663.69 103.71 2,781.27 2,884.98

F(ii) Other provisions _

Proposed equity dividend 441.52 441.52 - .

Additional tax on dividend 58.02] 58.02 - _

Others * 10.70 10.70 10.70 10.70

_ ._ - 510.24 510.24 10.701 10.70

Total 124.29 5,049.64 5,173.93 103.71 2,791.97 2,895.68

F (iii)* Disclosure pursuant to Accounting Standard (AS) 29 "Provisions, Contingent Liabilities and Contingent Assets"

Movement in provisions:

(Z Million)

Sr

No

1

Particulars

Balance as at 1-4-2015

Class of provisions

Total Sales Tax Others

4.00 6.70 10.70

2 Additional provision during the year _ -

3 Provision used during the year _ -

4 Provision reversed during the year _ -

5 Balance as at 31-03-2016 4.00 6.70 10.70

Nature of provisions:

i) Provision for sales tax pertains to claim made by the authorities on certain transaction of capital nature for the year 2002-03.

ii) Provision for others represents liabilities relating to matters in dispute

S-533

LAR

SE

N &

TO

UB

RO

INF

OT

EC

H L

IMIT

ED

NO

TE

S F

OR

MIN

G PA

RT O

F A

CC

OU

NTS

(Co

ntd

.)

G - Fixed Assets 01

(!Million)

Fixed and Intangible Assets

Gross Block Depreciation/Amortisation Net Block Net Block Mat

01-Apr-15 Pursuant to

acquisition of subsidiary Refer note

('I111)

Additions Deductions As at

31-Mar-16 As at

01-Apr-15 Pursuant to

acquisition of subsidiary Refer note

(7)(11)

For the year

On Deductions

As at As at

31-Mar-16 31-Mar•16 As at

31-Mar-15

Tangible Assets

leasehold Land 12.27 - - . 12,27 2.63 • 0.13 • 2.76 931 9.64 Buildings 207.38 - - - 207.38 81.61 - 8 40 - 90.01 11737 125.77 Leasehold Improvements 281.10 15.10 68.32 15.95 34837 46.82 15.10 35.65 3.22 94.35 254.22 234.28 Plant and machinery 987.76 - 95.14 229.06 853.84 343.73 - 89.67 130.50 302.90 550.94 644.03 Computers

a. Owned 1,890.33 104.56 371.81 65.44 2,30126 1,450.87 87.87 249.53 64.38 1,723.89 577.37 439.46 b. Leased 22.61 - - 22.61 • 22.61 - - 22.61 - - •

Office Equipments 882.63 12.93 119.22 126.26 88852 588.71 11.98 110.72 123.76 587.65 300.87 29332 Furniture and fixtures 1,189.61 10.66 93.10 161.45 1,131.92 606.32 5.69 104.01 138.27 577.75 554.17 583.29 Vehicles 445.04 1.72 92.08 70.76 468.08 158.41 0.37 56.49 32.64 182.63 285.45 286.63 Capital Work in Progress 1.00 47.63 Total Of Tangible Assets 5,918.73 144.97 839.67 69153 6,211.84 3,301.71 121.01 654.60 515.38 3,561.94 2,650.90 2,664.65 Total Of Tangible Assets (Previous Year) 5,601.21 • 706.95 389.44 5,918.72 2,990.85 • 672.16 361.31 3,30170 2,664.65 2,698.48

Intangible Assets Software 1,893.47 47.28 174.52 5.83 2,109.44 1,138.00 43.87 379.88 5.82 1,555.93 55331 755.47 Business Rights 98.05 - - - 98.05 98.05 - • - 98.05 . • .

Intangible Assets under Development 18736 195.37 Total of intangible Assets 1,991.52 47.28 174.52 5.83 2,207.49 1,236.05 43.87 379.88 5.82 1,653.98 741.07 950.84 Total Of Intongible Assets (Previous Year) 1,48169 - 670.68 161.85 1,991.52 1,150.48 -

, 247.41 161.83 1,23606 950 84 750.48

Notes: 1. Impairment up to 31-03-2016 - NIL

2. Additions during the year & capital work-in-progress include! Nil (previous year! Nil) being borrowing cost capitalised in accordance with Accounting Standard (AS) 16 on "Borrowing Costs" prescribed under section 133 of the Companies Act, 2013, read with rule 7 of the Companies (Accounts) Rules, 2014.

3. Consequent to the adoption of schedule II to the Companies Act, 2013, the depreciation for the year ended March 31, 2015 is higher and the profit before tax is lower by 1' 70.30 Mn. Further, an amount of ? 12.27 Mn (net of tax of! 10.10 Mn) representing the carrying amount of assets with revised useful life as nil, has been charged to the opening reserves as on April 1,2014 pursuant to the provisions of the Companies Act, 2013.



H. Investments

(Z Million)

As at 31-03-2016 As at 31-03-2015 H(i) Non-current investments

Trade investments (at cost)

Long term investment in subsidiaries

1, fully paid equity share of Euro 25,000 in Larsen & Toubro Infotech GmbH 1.14 1.14 100, fully paid equity shares of CAD 1 each in Larsen & Toubro Infotech Canada

Limited 6.61 6.61

168,197 equity shares of Z 10 each in GDA Technologies Limited 323.00 323.00

1,000,000, equity shares at no par value in L&T Infotech Financial Services Technologies Inc. _ 2,806.32 2,806.32 332,350, equity shares at no par value in Larsen And Toubro Infotech South Africa

(Proprietary) Limited 2.01 2.01

Investment in L&T Information Technology Services (Shanghai) Co. Limited* 10.89 7.07 3,500,000 equity shares of 10 each in Information Systems Resource Centre Private

Limited (refer note 1(11)) 806.96

Investment in Larsen & Toubro Infotech Austria GmbH # 2.60

50,000 equity shares of Euro 1 in L&T Information Technology Spain, Sociedad

Limitada $ 3.65

Total non-current investments 3,156.22 3,953.11

• Investment in this entity is not denominated in number of shares as per laws of the People's Republic of China.

44 The Company has formed a new entity "Larsen & Toubro Infotech Austria GmbH" in Austria on June 18, 2015. Investment in this entity is not denominated in number of shares as per the local laws of Austria.

$ The Company has formed a new entity "L&T Information Technology Spain, Sociedad Limitada" in Spain on February 1, 2016.

H (ii) Current Investments

(Z Million)

Particulars/ Scheme name Face Value per

unit

Units as at

31-03-2016

Amount as at

31-03-2016

Amount as at

31-03-2015 Liquid investments — quoted

Birla Sun Life Cash Plus — DDR 100 369,518.38 37.02 -

Reliance Medium Term Fund — MDR 10 2,794,062.26 30.33 -

L&T Liquid Super IP DDR 1000 - - 202.13

Templeton India Ultra Short Bond Fund- Super IP-D 10 100.00

Templeton India TMA - Super IP- DDR 1000 - 100.15

Religare Invesco Liquid Fund - DDR 1000 _ 100.04

IDFC Ultra Short Term Fund - Reg - DDR 10 100.00

Total (A) 3,163,580.64 67.35 602.32

Fixed maturity plans — quoted

UTI Fixed Term Income Fund Series XVIII - X (366 days)-Growth 10 - 20.00

Total (B) - 20.00

Total (A+B) 3,163,580.64 67,35 622.32

S-535



Details of quoted investments:

(? Million)

Amount As at

31-03-2016 Amount As at

31-03-2015 (a) Aggregate amount of quoted current investments and market value thereof;

Book Value 67.35

622.32 Market Value 67.51

623.96

I. Deferred tax assets/liabilities

(T Million)

Particulars Deferred tax asset/

(liability) as at

March 31,2015

Deferred tax asset/

(liability) pursuant

to amalgamation

Current year

(charge) / credit (Charge) / credit to

Hedging Reserve Deferred tax asset/

(liability) as at

March 31, 2016

Deferred tax liabilities

Depreciation /

amortisation (15.34) 5.72 41.86 - 32.24 Gain on derivative

transactions (304.09) - - 121.16 (182.93)

Branch profit tax (323.40) - (103.53) - (426.93) _ Premia on derivative

transactions - - (570.42) - (570.42)

Others - - (1.41) - (1.41)

TOTAL (642.83) 5.72 , (633.50) 121.16 (1,149.45)

Deferred tax assets

Provision for doubtful

debts and advances 7.19 - 24.07 - 31.26 Provision for employee

benefits 60.50 2.43 34.80 - 97.73 Loss on derivative

transactions 498.30 - - (487.70) 10.60 Realised gain on

derivative transactions - - 41.36 41.36

Others 9.97 - 9.97

TOTAL 565.99 2.43 110.20 (487.70) 190.92 Net deferred tax

assets/(liabilities) (76.84)j 8.15 (523.30)_ (366.54) (958.53)

S-536



J. Trade receivables and unbilled revenue

(Z Million)

Amount As at 31-03-2016


.I(i) Trade receivables

Unsecured

Debts outstanding for a period exceeding six months

Considered good

325.46 64.46 Considered doubtful

156.56 69.27

482.02 133.73 Other debts

Considered good

- Due from holding company 450.38

- Due from subsidiaries 160.22 195.22 - Due from fellow subsidiaries

55.34 84.67

- Others

9,904.57 9,970.04

10,570.51 10,249.93 Less : Allowance for bad & doubtful debts (156.56)

10,895.97

(69.27)

10,314.39

J(ii) Unbilled revenue

Unbilled revenues comprise revenue recognised in relation to services performed in accordance with contract terms but not billed.

K. Cash and bank balances

(Z Million)


Amount As at

31-03-2016

Cash and cash equivalent

Cash on hand 0.62 0.65 Balances with bank

- in current accounts

Overseas 872.93 650.14

Domestic 223.45 217.48

Remittances in transit 94.82 221.58 Fixed deposits (maturity less than 3 months) 4.28 125.12

1,196.10 1,214.97

Other bank balance

- in deposit accounts

Earmarked balances with banks-unclaimed dividend 0.62

*Cash and bank balance not available for immediate use 25.03 119.37

1,221.75 1,334.34

* Other bank balance not available for immediate use being in nature of security for guarantees issued by bank on behalf of the Company, collaterals etc.

S-537



L. Loans and advances

(!Million)

Non-current Current

- ... ,.•-,,,.-........., Total Non-current Current Total

Unsecured - _ Considered good

Loans against mortgage of house property - 0.10 0.10

Premia on forward

contracts 1,280.43 2,385.73 3,666.16 874.90 1,723.63 2,598.53

Interest receivable - 0.80 0.80 - 6.67 6.67

Deposits 393.14 _ 150.55 543.69 359.38 123.96 483.34 ___ - Capital advances 1,25 1.25 6.64 - 6.64

Advance tax current year

(net of provision) 82.13 82.13 159.95 159.95

Advances recoverable in

cash or in kind 2,574.31 3,079.01 5,653.32 1,146.34 3,392.90 4,539.24

- Considered doubtful - 6.06 6.06 .. _ Less : Provision for bad &

doubtful loans & advances _ - - - (6.06) (6.06)

4,249.13 5,698.22 9,947.35 2,387.26 5,407.21 7,794.47

M.

N.

Revenue

(T Million)

2015-16 2014-15

Overseas 52,295.01 45,368.13

Domestic 3,400.19 2,075.90

55,695.20 47,444.03

Other income

(Z Million)

201546 2014-15 Income from current investment in mutual funds 47.94 119.62. -- Interest received 17.25 17.99

Foreign exchange gain 2,776.13 685.56

Provision no longer required for doubtful debts 1.08

Dividend from subsidiary 472.38

Miscellaneous income 71.28 64.63

3,386.06 887.80

S-538



0. Expenses (Z Million)

2015-16 2014-15 0(i) Employee benefit expenses

Salaries including overseas staff expenses 32,491.86 26,889.46 Staff welfare 863.72 790.11 Contribution to provident and other funds 344.99 247.01 Contribution to superannuation fund 52.05 44.71 Contribution to gratuity fund 85.75 93.43

33,838.37 28,064.72

(Z Million)

2015-16 2014-15

Dperatirig expenses Communication expenses 177.38 151.27 Consultancy charges 4,133.23 3,366.86 Cost of software packages for own use 386.62 344.47 Cost of bought-out items for resale 1,973.39 742.75

6,670.62 4,605.35

(Z Million)

2015-16 2014-15 ojiiit Sales, administration and other expenses

Travelling and conveyance 1,387.88 1,155.63 Rent and establishment expenses 1,525.22 1,381.30 Telephone charges and postage 362.22 330.87 Legal and professional charges 536.15 517.62 Printing and stationery 24.94 28.06 Advertisement 112.19 89.94 Entertainment 70.26 54.43 Recruitment expenses 143.09 129.61 Repairs to building 199.36 134.90 Repairs to computers 60.26 85.02 General repairs and maintenance 317.69 250.51 Power and fuel 347.83 287.19 Equipment hire charges 12.90 10.15 Insurance charges 159.51 161.64 Rates and taxes 194.91 330.67 Allowance for doubtful debts and advances 86.13 74.07 Bad debts 4.90 39.13 Less: Provision written back (4.90) (39.13) Commission paid 6.99 0.62 Books, periodicals and subscriptions 17.80 27.43 Directors fees 1.43 0.93 Commission to directors 5.81 3.60 Loss on sale of fixed assets 26.82 3.16 Miscellaneous expenses 303.09 161.27 Amortisation of cost of long term projects * 6.35

5,902.48 5,224.97

* Cost incurred for long term projects mainly comprise of legal and employee related costs to secure long term projects. These costs are amortised over a period of two years commencing from the date of securing the project.

S-539



P. Finance cost

P(i) Interest expenses

On others

P(ii) Exchange loss on borrowings (net)

Q. Provision for taxation

31.91

25 9/3

57 89

45 68

103.57

(Z. Million)

2014-15

46.94

9.28

56.22

47.96

104.18

(Z Million)

2014-15

2,117.82 Current tax 2,676.97

(1,086.70)

36.86

1,627.13

MAT credit entitlement for current year

(505.04)

Provision for earlier years

(9.96)

Total current taxes

1,602.82

a) The current year tax charge includes 616.76 Mn (previous year! 405.29 Mn) payable outside India.

b) The Central Board of Direct Taxes (CBDT) has notified the Income Computation and Disclosure Standards (ICDS) with effect from April 1, 2015

and shall accordingly apply for assessment year 201617 onwards. Accordingly, the Company has accounted for the impact of ICDS in its tax

computation.

R. Contingent liabilities -

(Z

2014-15

1. Income tax liability that may arise in respect of which the Company is in appeal* 1,338 80 1,164.82

2. Corporate guarantee given on behalf of subsidiary** 5,998 76 5,395.70

Service tax refund disallowed, in respect of which the Company is in appeal # 12.48 4.52

4.

5.

Sales tax liability in respect of which the Company is in appeal 128

Legal notice served by vendor for unpaid dues, disputed by the Company. 0.02

7,35134 6,565.04

* Out of contingent tax liability disclosed above, 1,280.69 Mn (including interest of! 202.48 Mn), pertains to the tax demand arising on account of disallowance of exemption under section 10A on profits earned by STPI Units on onsite export revenue. Company is pursuing appeal against these

demands before the relevant Appellate Authorities.

The Company believes that its position is likely to be upheld by appellate authorities and considering the facts, the ultimate outcome of these

proceedings is not likely to have material adverse effect on the results of operations or the financial position of the Company.

** The Company has given a Corporate guarantee on behalf of its wholly owned subsidiary, L&T Infotech Financial Services Technologies Inc., Canada. The guarantee is for performance of all obligations by L&T Infotech Financial Services Technologies Inc. in connection with the long term annuity

services contracts obtained by them. The obligation under this guarantee is limited in aggregate to the amount of CAD 70,000,000.

The Company has given a Corporate guarantee on behalf of its subsidiary, Larsen And Toubro Infotech South Africa (Proprietary) Limited. The guarantee

is for performance of all obligations by Larsen And Toubro Infotech South Africa (Proprietary) Limited in connection with the Application Testing Service

contract. The obligation under this guarantee is limited in aggregate to the amount of USD 31,414,785.

The Company has given a corporate guarantee on behalf of its subsidiary, Larsen And Toubro Infotech South Africa (Proprietary) Limited. The guarantee is for performance of all obligations by Larsen & Toubro Infotech South Africa (Proprietary) Limited in connection with software development services & related services. The obligation under this guarantee is limited in aggregate to USD 5,000,000.

S-540



# The Company had filed refund of accumulated service tax credit in accordance with relevant CENVAT Credit Rules. However, the department has disallowed

certain portion of such refunds considering the same as ineligible as not related with export and output services. The Company is in appeal against these

disallowances before the relevant Authorities and hopeful of getting a favourable order.

S. Estimated amount of contracts remaining to be executed on capital account (net of advances) and not provided for: 131.87 Mn

(previous year: 310.76 Mn)

T (1) Employee benefits

a) The amounts recognised in balance sheet are as follows

(? Million)

Present value of defined benefit obligation as on March

31, 2016

As at March 31, 2016 (March Post retirement

medical benefit

plan

31,2015)

Self-managed

provident fund

plan

Gratuity plan

- Wholly funded 579.76 - 4,253.92

(497.01) (3,776.10) - Wholly unfunded 124.53 -

(-) (103.95) (-) 579.76 124.53 4,253.92

(497.01) i (103.95) (3,776.10) b) Fair value of plan assets as on March 31, 2015 492.99* - 4,264.26 *

(409.85) i ( -) (3,778.70) Amount to be recognised as liability or (asset) (a-b) 86.77 124.53 (10.34)

(92.42) (103.95) (2.60) B Amounts reflected in the balance sheet

Liability 86.77 124.53 55.66

(92.42) (103.95) (46.59)

Assets - - _ (-) (-) I (-)

Net liability/(asset) 86.77 124.53 55.66 #

(92.42) (103.95) (46.59)

Net liability/(asset)-current 86.77 I 0.24 55.66

(92.42) (0.24) (46.59) Net liability/(asset)- non current 124.29 -

I_ 14 (103.71) (-)

* Asset is not recognised in the balance sheet.

# Employer's and employee's contribution for March 2016 paid in April 2016.

S-541



b) The amounts recognised in statement of profit and loss are as follows:

(Z Million)

Current service cost

Gratuity plan

91.34

Post retirement

medical benefit

plan

21.99

Self-managed

provident fund

plan

257.11

(77.00) (18.66) (232.40) Interest cost 43.07 9.94 315.53

(40.67) (9.66) (252.26) 3 Expected return on plan assets -27.86 - -315.53

(-26.67) (-) (-252.26) 4 Actuarial losses/(gains) -15.48 -11.13 -

(10.62) (-12.94) (-42.43) Total expense for the year included in staff cost 91.07 20.80 257.11

(101.62) (15.38) (189.97)

c) The changes in the present value of defined benefit obligation representing reconciliation of opening and closing balances thereof

are as follows:

(Z Million)

Opening balance of the present value of defined benefit obligation

Gratuity plan

497.01

Post retirement

medical benefit

plan

103.95

Self-managed

provident fund

plan

3,776.10

(408.57) (88.79) (3,412.68) Add : Current service cost 91.34 21.99 257.11

(77.00) (18.66) (232.40) Add : Interest cost

_

43.07 9.94 315.53 (40.67) (9.66) (252.26)

Add : Contribution by plan participants 580.57

(-) (-) (456.33)

Add/(Less) : actuarial (gains)/losses -2.39 -11.13

(16.09) (-12.94) (-42.43) Less: other adjustments (refer note below (d)) - 181.75

- (-) Add : Liabilities assumed on acquisition/(settled on divestiture) 5.12

(-) (-) (-221.93)

493.64 Less : Benefits paid 54.39 0.22

(45.32) (0.22) (313.21) Closing balance of the present value of defined benefit obligation 579.76 124.53 4,253.92

(497.01) (103.95) (3,776.10)

S-542

2015-16 (2014-15) Gratuity plan Self-managed

provident fund

plan

25.3%



(d) Changes in the fair value of plan assets representing reconciliation of the opening and closing balances thereof are as follows:

(!Million)

Opening balance of the fair value of the plan assets

2015-16

Gratuity plan

404.59

(2014-15)

Self-managed

provident fund

plan

3,778.70

(379.19) (3,352.80)

315.53

(252.26)

Add : expected return on plan assets _ 27.86

(26.67) Add/(Less) : actuarial gains/(losses)

_

13.09 26.56

(5.45) (19.) 23 Add : Contribution by the employer _ 96.73 244.32

(38.60) (228.83) Less: other adjustments (refer note below (d)) 181.75

(-) Less : Assets acquired on acquisition/(distributed on divestiture) 5.12

(-) (215.38) Add : Contribution by plan participants

_...6_

574.54

H (454.17) Less : Benefits paid 54.39 493.64

(45.32) (313.21) Closing balance of the plan assets 492.99 4,264.26

(404.59)1 (3,778.70)

The Company expects to contribute 86.76 Mn (previous year 92.42 Mn) towards its gratuity.

The Company's share of defined benefit obligation/fair value of plan assets adjusted by the Trust of the holding company.

e) The major categories of plan assets as a percentage of total plan assets are as follows:

Government of India securities

State government securities

Corporate bonds

(24.7%)

15.8%

Scheme

with

10.3%

L1C

(7.6%)

Fixed deposits under Special Deposit Scheme framed by Central Government for provident

funds

Public sector bonds

9.3%

(10.3%)

39.3%

(42.3%)

S-543

Effect on the aggregate of the service cost and interest cost 7.93 -6.06

(6.85) (-5.24)

Effect on defined benefit obligation

(19.22) (-15.01)

22.86 -17.85

2013-14 2012-13 2011-12 2014-15 2015-16

Defined benefit obligation 124.53 103.95 88.79 90.81 42.19



Principal actuarial assumptions at the balance sheet date (expressed as weighted averages):

2015-16 2014-15

1 Discount rate as at March 31

For gratuity

7.75%

7.90%

For post-retirement medical benefits

7.75%

7.90%

2 Annual increase in healthcare costs (see note below)

5.0%

5.0%

3 Attrition rate

Varies between 2% Varies between 2%

to 18% for various to 18% for various

age groups age groups

4 Salary growth rate

5.0% 5.0%

The estimates of future salary increases considered in actuarial valuation take into account inflation, seniority, promotion and other

relevant factors such as supply and demand in the employment market.

Although the obligation of the Company under the post-retirement medical benefit plan is limited to the overall ceiling limits, assumed

healthcare cost trend rates may affect the amounts recognised in the statement of profit and loss. At present, healthcare costs, as

indicated in the principal actuarial assumption given above, are expected to increase at 5% p.a. A one percentage point change in

assumed healthcare cost trend rates would have the following effects on the aggregate of the service cost and interest cost and defined

benefit obligation:

(Z Million)

Effect of

1% increase

1% decrease

a) The amounts pertaining to defined benefit plans for the current year are as follows:

Post-retirement medical benefit plan (non-funded) (T Million)

Gratuity plan

(? Million)

2015-16 2014-15 2013-14 2012-13 i 2011-12

Defined benefit obligation 579.76 497.01 408.57 384.12 297.59

2 Plan assets 492.99 404.59 379.19 296.11 156.90

3 (Surplus)/deficit 86.77 92.42 29.38 88.01 140.69

Self-managed provident fund plan

(? Million)

2015-16 2014-15 , 2013-14 , 2012-13 _

2011-12

Defined benefit obligation 4,253.92 3,776.10 3,412.68 2,710.62 2,178.30

2 Plan assets 4,264.26 3,778.70 3,352.80 2,685.76 2,142.59

3 (Surplus)/deficit (10.34)_ (2.60) 59.88 24.86 35.71

S-544



Experience adjustments Gratuity

(Z Million)

015-1.6 2014-15 2013-14 2012-13 2011-12

Defined benefit obligation 57976 497.01 408.57 384.12 297.59

Plan assets 492.99 404.59 379.19 296.11 156.90_

(Surplus) / deficit 8677 92.42 29.38 88.01 140.69

Experience adjustments on plan

liabilities (7.53) (14.36) (6.21) 5.05 95.81

Experience adjustments on plan

assets 13.09 5.45 8-19 8.56 2.34

General descriptions of defined benefit plans:

a) Gratuity plan

The Company makes contributions to the Employees' Group Gratuity-cum-Life Assurance Scheme of the Life Insurance Corporation

of India, a funded defined benefit plan for qualifying employees. The scheme provides for lump sum payment to employees

at retirement, death while in employment or termination of employment of an amount equivalent to 15 days salary for every

completed year of service or part thereof in excess of six months, provided the employee has completed five years in service.

b) Post-retirement medical benefit plan

The post-retirement medical benefit plan provides for reimbursement of health care costs to certain categories of employees post

their retirement. The reimbursement is subject to an overall ceiling limit sanctioned at the time of retirement. The ceiling limits are

based on cadre of the employee at the time of retirement.

c) Self-managed provident fund plan

The Company's provident fund plan is managed by its holding company through a Trust permitted under the Provident Fund Act,

1952. The plan envisages contribution by employer and employees and guarantees interest at the rate notified by the Provident

Fund Authority. The contribution by employer and employee together with interest are payable at the time of separation from

service or retirement whichever is earlier. The benefit under this plan vests immediately on rendering of service.

The interest payment obligation of trust managed provident fund is assumed to be adequately covered by the interest income on

long term investments of the fund. Any shortfall in the interest income over the interest obligation is recognised immediately in

the Statement of Profit and Loss as actuarial loss. Any loss arising out of the investment risk and actuarial risk associated with the

plan is also recognised as expense in the period in which such loss occurs. Further, on amount off Nil has been provided based on

actuarial valuation towards the future obligation arising out of interest rate guarantee associated with the plan.

T.(2) (i) In line with the Company's Financial Risk Management Policy, financial risks relating to changes in the exchange rates, are hedged

by forward contracts, besides the natural hedges. The loss on fair valuation of the derivative contracts which are designated and

are effective as hedges, amounting to Z 2,695.02 Mn (net of deferred tax) (Previous year Z 366.96 Mn (net of deferred tax)) has

been accounted in retained earnings in balance sheet. The loss/ (gain) off (1,297.52 Mn) (Previous year gain off 243.04 Mn) on

settlement of the forwards is recognised in statement of profit and loss.

The particulars of derivative contracts entered into for hedging foreign currency risks outstanding as at March 31, 2016 are as under:

(Z Million)

Sr. Category of derivative instruments

Forward contracts for receivables

Notional amount

March 31, 2016

Notional amount

March 31, 2015

43,470.51 58,583.85

S-545



Un-hedged foreign currency exposures as at March 31, 2016 are as under:

(Z Million)

Sr. Un-hedged foreign currency exposures March 31, 2016 March 31, 2015

1 Receivables including firm commitments and highly probable forecast transactions 41,271.25 30,001.71

2 Payables including firm commitments and highly probable forecast transactions 28,796.36 24,474.66

T.(2) (ii) The Company has made provision, as required under the applicable law or accounting standard for material foreseeable losses on

long term derivative contracts.

T(3) Income/expenditure in foreign currency

T.(3) (i) Expenditure in foreign currency:

(!Million)

2015-16 2014-15

Overseas staff costs 19,650.52 16,661.19

Foreign travel 330.66 305.56

Agency commission 6.96 0.62

Subcontracting expenses 3,776.21 2,923.75

Overseas office expenses (including others) 2,706.86 1,928.01

26,471.21 21,819.13

T.(3) (ii) Earnings in foreign currency:

(Z Million)

2015-16 2014-15

Software exports 52,295,01 45,368.13

Other income 490.77 27.32

52,785.78 45,395.45

T.(4) Auditors' remuneration (excluding service tax) charged to the accounts include:

(Z Million)

2015-/6 2014-15

Audit fees _ 1.65 1.65

Tax audit fees 0.65 0,65

Other services 2.32 3.58

Expense reimbursement 0.09 0.05

4.71 5.93

T.(5) Value of imports on C.I.F. basis

(Z Million)

2015-16 2014-15

Capital goods 64.13 1.81

Others 41.72 20.98

105.85 22.79

T.(6) Leases

Finance leases

In accordance with Accounting Standard 19 "Leases" issued by the Institute of Chartered Accountants of India, the assets acquired

under finance leases on or after April 1, 2001 are capitalised and a loan liability is recognised for an equivalent amount. Consequently

S-546



depreciation is provided on such assets. Lease rentals paid are allocated to the liability and the interest is charged to statement of profit

and loss.

Operating leases

The Company has taken employee used cars under non-cancellable operating leases. The rental expense in respect of operating leases

was 0.06 Mn (previous year 1.21 Mn) and the future rentals payable are as follows:

(!Million)

2015-16 2014-15 Minimum lease payments

- Payable not later than 1 year 0.16 - Payable after 1 year but not later than 5 years

0.16

T.(7) Basic and diluted earnings per share (EPS) at face value of! 1

201546 2014-15 Profit after tax (!Million) 9,381.31 7,729.62 Weighted average number of shares outstanding 163,914,663 161,250,000

Basic EPS (Z) 57.23 47.94

Weighted average number of shares outstanding 163,914,663 161,250,000

Add : weighted average number of potential equity shares on account of employee

options 392,052 7,270,100


Diluted EPS (Z) 57.10 45.87

EPS for the previous year is after considering sub-division of equity shares from face value of 5 each to face value of! leach per equity share (refer note B(1)).

T.(8) Related party disclosure:

T.(8) (i) List of related parties over which control exists/exercised:

Name

Larsen & Toubro Infotech GmbH

Relationship

Wholly owned subsidiary

Larsen & Toubro Infotech Canada Limited Wholly owned subsidiary

GDA Technologies Limited Wholly owned subsidiary

Larsen & Toubro Infotech LLC Wholly owned subsidiary

L&T Infotech Financial Services Technologies Inc Wholly owned subsidiary

Larsen & Toubro Infotech South Africa (Proprietary) Limited _ Subsidiary

L&T Information Technology Services (Shanghai) Co. Limited Wholly owned subsidiary

Information Systems Resource Centre Private Limited (Refer note T (11)) Wholly owned subsidiary Larsen & Toubro Infotech Austria GmbH Wholly owned subsidiary

L&T Information Technology Spain, Sociedad Limitada. Wholly owned subsidiary

S-547



T.(8) (ii) Key Management personnel:

Mr. V. K. Magapu Managing Director*

Mr. Sanjay Jalona

Mr. Chandrashekara Kakal

Mr. K. R. L. Narasimham

Chief Executive Officer & Managing Director **

Chief Operating Officer & Executive Director ***

Executive Director #

Mr. Vivek Chopra

Dr. Mukesh Aghi

Mr. Sunil Pande

Chief Executive (Industrials Cluster) & Executive Director $

Chief Executive (Services Cluster) & Executive Director

Executive Director AA

Ceased to be Director w.e.f, the close of working hours of September 25, 2015

Appointed as Chief Executive Officer & Managing Director w.e.f. August 10, 2015

Ceased to be Director w.e.f. the close of working hours of August 26, 2015

# Ceased to be Director w.e.f. the close of working hours of April 7, 2015

$ Ceased to be Director w.e.f. the close of working hours of December 31, 2014 A Ceased to be Director w.e.f. the close of working hours of February 28, 2015

^^ Ceased to be Director w.e.f, the close of working hours of August 25, 2015

T.(8) (iii) List of related parties with whom there were transactions during the year:

Larsen & Toubro Limited

!Holding Company


Larsen & Toubro Infotech Canada Limited




L&T Infotech Financial Services Technologies Inc

L&T Information Technology Services (Shanghai) Co. Limited

Larsen & Toubro Infotech South Africa (Proprietary) Limited

Information Systems Resource Centre Private Limited (Refer note T (11))

Larsen & Toubro Infotech Austria GmbH

L&T Information Technology Spain, Sociedad Limitada

Larsen & Toubro (East Asia) SDN.BHD



Subsidiary




Fellow Subsidiary

Larsen & Toubro Infotech GmbH

Larsen & Toubro Infotech LLC

GDA Technologies Limited

L&T Hydrocarbon Engineering Limited Fellow Subsidiary

L&T Electricals and Automation Saudi Arabia Company LLC

L&T Finance Limited

Fellow Subsidiary

Fellow Subsidiary

L&T General Insurance Company Limited Fellow Subsidiary

L&T Infrastructure Development Projects Limited Fellow Subsidiary L&T Power Development Limited

Larsen & Toubro Kuwait Construction General Contracting Company, With Limited Liability

L&T Infrastructure Finance Company Limited

L&T Metro Rail (Hyderabad) Limited

L&T Technology Services Limited

L&T Valves Limited

L&T Investment Management Limited

L&T Construction Equipment Limited _ Larsen & Toubro LLC

Nabha Power Limited

iFellow Subsidiary

Fellow Subsidiary

Fellow Subsidiary

Fellow Subsidiary

Fellow Subsidiary

Fellow Subsidiary

Fellow Subsidiary

Fellow Subsidiary

Fellow Subsidiary

Fellow Subsidiary

Fellow Subsidiary

j Fellow,. Subsidiary

L&T Electrical & Automation FZE

Spectrum Infotech Private Limited

S-548



Family Credit limited

PT. Tamco Indonesia

j Fellow Subsidiary

Fellow Subsidiary

L&T Special Steels and Heavy Forgings Private Limited

Fellow Subsidairy

Larsen & Toubro ATCO Saudi LLC

Fellow Subsidiary

L&T Thales Technology Services Private Limited

Fellow Subsidiary „ry L&T Capital Markets Limited

Fellow Subsidiary

L&T Housing Finance Limited

Fellow Subsidiary

Larsen & Toubro Electromech LLC

Fellow Subsidiary__

Tamco Electrical Industries Australia PTY Limited

Fellow Subsidiary

L&T Technology Services LLC

Fellow Subsidiary

T.(8) (iv). Related Party Transactions

(7 Million)

ansactio

Sale of services / products

o mg, o pany

1,101.09 1,499.50 423.59

(352.00) (1,500.90) (324.91)

- L&T Metro Rail (Hyderabad) Limited 63.60

- L&T Technology Services Limited 50.50

- L&T Hydrocarbon Engineering Limited 78.80

- L&T Thales Technology Services Private Limited 95.70 - Larsen & Toubro Infotech GmbH 493.31 _ - L&T Infotech Financial Services Technologies Inc. 330.55

- Larsen And Toubro Infotech South Africa (Proprietary) Limited 391.73

Larsen & Toubro Infotech Canada Limited 278.03

Sale of assets

- L&T Technology Services Limited

108.62 7.70

- 7.70

Purchase of services

- Larsen & Toubro Infotech LLC

- Larsen & Toubro Infotech Canada Limited


275.43 347.68 694.17

(1,034.96) (454.97)

133.45

(686.46)

_ 193.64

694.17 Overheads charged by

- Larsen & Toubro Infotech GmbH

- Larsen & Toubro (East Asia) SDN.BHD

- L&T Electrical & Automation FZE

- Larsen & Toubro Kuwait Construction General Contracting

Company, With Limited Liability

_ 635.01 21.78 38.11

(125.82) (163.58) , (44.45)

19.55

24.03

7.19

6.23

Overheads charged to

- Larsen & Toubro Infotech Canada Limited

- Larsen & Toubro Infotech GmbH

- Larsen & Toubro Infotech South Africa (Proprietary) Limited


82.49 i 145.54 422.61

(60.77) (99.64) (613.95)

51.64

64.49

20.91

421.30

S-549



Transaction

Commission charged to

- Larsen & Toubro Infotech South Africa (Proprietary) Limited


Holding Company Subsidiaries

3.62

Fellow Subsidiaries

5.26

(-) (-) (11.81)

3.62

- 5.26 Lease rent - 0.07

(-) (-) (0.52) Commission - _ -

(-) (-) (0.62) Trademark fees 104.89 - .

(-) (-) (-) Investments

- Larsen &Toubro Information Technology Services (Shanghai)

Co. Limited

- Larsen & Toubro Infotech Austria GmbH

- Larsen & Toubro Information Technology Spain, Sociedad

Limitada _

10.07 -

(806.96)

3.82 _ 2.60

- 3.65

Trade receivable 450.38 160.22 55.34

- (195.22) (84.67) Trade payable - - -

(174.23) - - Interim dividend 5,264.81 - -

(4,805.25)

Dividend received - 472.38 - L&T Infotech Financial Services Technologies Inc. 472.38 -

T.(8) (v) Managerial remuneration

(!Million)

Particular 2015-16 2014-15 Total managerial remuneration 57.31 183.69 Amount for major parties

Salaries, commission and perquisites :- _____ Mr. V K Magapu 7-35 15.12 Mr. Sanjay Jalona 33.61

Mr. Chandrashekara Kakal 10.85 10.48 Mr. Vivek Chopra 68.52 Dr. Mukesh Aghi 68.56

T.(9) Segmental reporting

The Company had 2 business segments. Services Cluster includes Banking & Financial services, Insurance, Media & Entertainment,

Travel & Logistics and Healthcare. Industrials Cluster includes Hi Tech and Consumer Electronics, Consumer, Retail & Pharma, Energy &

Process, Automobile & Aerospace, Plant Equipment & Industrial Machinery, Utilities and E&C.

S-550


NOTES FORAIDIG PART OF ACCOUNTS (Contd.)

1.(9)(i) Revenues represented along industry classes comprise the primary basis of segmental information set out in these financial statements.

The revenue and operating profit by segment is as under:

(!Million)

Revenue

Semmes Cluster

29,190.68 _ _

ndustrials Cluster

_ 26,504.52

Total ,

55,695.20

(24,468.34) (22,975.69) (47,444.03)

Segmental operating profit 6,513.66 6,701.72 13,215.38

(5,521.28) (5,966.68) (11,487.96)

Una lloca ble expenses (net) 3,931.65

(1,938.97)

Other income 3,386.06

(887.80)

Operating profit 12,669.79

(10,436.79)

Finance cost

_ _ _______........ _ _

103.57

_ (104.18)

Depreciation 654.60

(659.89)

Amortization of intangible assets 379.88

(247.41)

Profit before tax 11,531.74

(9,425.31)

T.(9) (ii) Segmental reporting of revenues on the basis of the geographical location of the customers and is as under:

(Z Million)

Geography FY15

North America 32,024.48

Europe 9,702 52 8,839.21

India 3,400 19 2,075.90

APAC 1,188 61 1,198.13

ROW 3,21254 3,306.31

Total 55,695.20 47,444.03

Fixed assets used and liabilities contracted for performing the Company's business have not been identified to any of the above reported

segments as the fixed assets and services are used interchangeably among segments.

T.(10)Based on the information and records available with the Company, there are no amounts payable to micro and small enterprises as

defined in the Micro, Small and Medium Enterprises Development Act, 2006.

1.(11) On October 16,2014, the Company acquired entire share capital of Information Systems Resource Centre Private Limited ('ISRC'), thereby

making it a wholly owned subsidiary. Larsen & Toubro Infotech Limited is engaged in software development & related services. ISRC is

engaged in software services with respect to application development, information technology support and maintenance services to

OTIS Elevator Company Inc. (OTIS) and certain other group companies of OTIS, which are part of United Technologies Corporation (UTC)

group. The Company believes that acquisition will strengthen its relationship with UTC group. The acquisition was executed through a

share purchase agreement for a consideration of 806.96 Mn.

The Board of Directors of the Company and ISRC have approved the scheme of amalgamation of ISRC with the Company on October

17, 2014 and December 4, 2014, respectively, with October 17, 2014 as the appointed date. Accordingly, a petition for sanctioning the

scheme of amalgamation had been filed with the Hon'ble High Court of Judicature at Bombay.

S-551

806.96

35.00 _ 771.96



The Scheme has been sanctioned by the Hon'ble High Court of Judicature at Bombay vide its order dated September 4, 2015. The

Scheme was filed with the Registrar of the Companies on September 21, 2015 and came into effect on that day with appointed date being October 17, 2014. Pursuant thereto, the entire business and all the assets and liabilities, duties and obligations of ISRC have been

transferred to and vested in the Company with effect from October 17, 2014. In accordance with the Scheme, the investment held in

the subsidiary has been cancelled and ISRC being a wholly owned subsidiary of the Company, no equity shares were exchanged to effect

the amalgamation in respect thereof.

The amalgamation is accounted in accordance with 'pooling of interest method' as per Accounting Standard 14 'Accounting for

Amalgamations' and in accordance with scheme approved by the Hon'ble High Court of Bombay.

1) All assets and liabilities (including contingent liabilities),reserves, benefits under income-tax, benefits for under special economic

zone registrations, duties and obligations of ISRC have been recorded in the books of account of the Company at their carrying

amounts.

2) The amount of share capital of ISRC has been adjusted against the corresponding investment balance held by the Company in the

amalgamating company and the excess of share capital over the investment has been adjusted against general reserve.

3) Accordingly, the amalgamation has resulted in transfer of assets and liabilities as on October 17, 2014 in accordance with the terms

of the Scheme at the following summarised values:

(Z Million)

Particulars Amount Amount Non-current Assets

Fixed assets (net) 37.58 Deferred tax asset (set-off against deferred tax liabilities) 6.07 Long-term loans and advances 23.09_

Current assets Trade receivables 120 39

Cash and cash equivalents 35 89

Short-term loans and advances 22 43 178.71 Total assets 245.45 Non-current liabilities

Long-term provisions 6.29, Current Liabilities

Trade payables 26 54

Other current liabilities 2 21

46.75 53.04

Short-term provisions 18 00

Total liabilities NET ASSETS 192.41

The following balances as on October 17, 2014 have been added to the respective opening balances of the Company:

(? Million)

Capital reserve

General reserve

Profit & loss balance

The amount charged against general reserve of the Company pursuant to amalgamation is as follows:

0.42 56.40

100,58.,

g

Investment in the amalgamating company

Share capital taken over from the amalgamating company

Amount charged against general reserve

Pursuant to scheme of amalgamation, the appointed date of amalgamation being October 17, 2014, net profit after tax of ISRC for the

period October 17, 2014 to March 31, 2015 has been transferred to statement of profit & loss account in the books of the company

upon amalgamation.

S-552


NOTES FOPMING PART OF ACCOUNTS (Contd.)

Profit and loss account for the period October 17, 2014 to March 31, 2015 is as below:

(Z Million)

Revenue from services 191.00 — Other income 2.77_

Total revenue 193.77

Expenses:

(a) Employee benefits expense 81.32

(b)Operating and other expenses 66.99

6.06 (c) Depreciation and amortisation expense

Total expenses 154.37

Profit before tax 39.40

Tax expense:

Current tax _(a) 14.12

(b) Deferred tax (2.07)

Net profit after tax 27.35

As the scheme has become effective from September 21, 2015, the figures for the year ended March 31, 2016 are after giving effect to

the merger, hence are not comparable with corresponding period of earlier year as well as for the year ended March 31, 2015.

T.(12)The Board of Directors of the Company and GDA Technologies Limited (GDA) have approved the scheme of amalgamation of GDA with

the Company on October 17, 2014, respectively, with April 1, 2016 as the appointed date. Accordingly, a petition for sanctioning the

scheme of amalgamation has been filed with the Hon'ble High Court of Judicature at Bombay & the Hon'ble High Court of Judicature at

Madras.

The Scheme has been sanctioned by the Hon'ble High Court of Judicature at Bombay vide its order dated April 1, 2016. The approval of

the Scheme by the Hon'ble High Court of Madras is awaited.

T.(13)(a) Amount required to be spent by the Company on Corporate Social Responsibility (CSR) related activities during the year 149.22 Mn.

(b) The amount recognised as expense in the statement of profit & loss on CSR related activities during the year ended March 31, 2016

is 23.45 Mn, which comprises of:

General purposes Miscellaneous expenses in Note 000 20.79 II—

T.(14)The Company is not required to transfer any amount to Investor Education & Protection Fund.

T.(15)The Company in its board meeting held on June 16, 2015 has taken approval for the Offer for Sale ('the Offer') by Larsen & Toubro

Limited in the Initial Public Offering of the Company. Pursuant to the same, the Company had filed its Draft Red Herring Prospectus

('DRHP') on September 28, 2015. Owing to change in the Offer structure and other considerations, the said DRHP was withdrawn on

April 11, 2016 and pursuant to the approval of the IPO Committee, the Company filed a revised DRHP on April 12, 2016.

T.(16) Previous year's figures have been regrouped / reclassified wherever necessary.

As per our report attached SHARP & TAN NAN Chartered Accountants Firm's Registration No. 109982W

by the hand of

FIRDOSH D. BUCHIA

Sanjay Jalona

R. Shankar Raman Ashok Kumar Sonthalia

Subramanya Bhatt

Partner


Director Chief Financial Officer

Company Secretary

Membership No: 38332

& Managing Director

DIN: 00019798

M. No. F2125 DIN: 07256786

Mumbai

Mumbai

April 26, 2016

April 26, 2016

S-553


INDEPENDENT AUDITOR'S REPORT

To the members of Larsen & Toubro lnfotech Limited

Report on the audit of the consolidated financial statements

We have audited the accompanying consolidated financial statements of Larsen & Toubro Infotech Limited ('the Holding Company') and its

subsidiaries (the Holding Company and its subsidiaries together referred to as 'the Group') which comprise the consolidated balance sheet

as at March 31, 2016, and the consolidated statement of profit and loss and the consolidated cash flow statement for the year then ended,

and notes to the consolidated financial statements, including a summary of the significant accounting policies ('the consolidated financial

statements').

Management's responsibility for the consolidated financial statements

The Holding Company's board of directors is responsible for the preparation of these consolidated financial statements in terms of the

requirements of the Companies Act, 2013 ('the Act') that give a true and fair view of the consolidated financial position, consolidated

financial performance and consolidated cash flows of the Group in accordance with the accounting principles generally accepted

in India, including the Accounting Standards specified under section 133 of the Act, read with rule 7 of the Companies (Accounts)

Rules, 2014. The respective board of directors of the companies included in the Group are responsible for maintenance of adequate

accounting records in accordance with the provisions of the Act for safeguarding the assets of the Group and for preventing and

detecting frauds and other irregularities; the selection and application of appropriate accounting policies; making judgments and

estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls,

that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and

presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud

or error, which have been used for the purpose of preparation of the consolidated financial statements by the Directors of the Holding

Company, as aforesaid.

In preparing the consolidated financial statements, the respective board of directors of the companies included in the Group are responsible

for assessing the ability of the Group to continue as a going concern, disclosing, as applicable, matters related to going concern and using

the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic

alternative to do so.

The respective board of directors of the companies included in the Group are responsible for overseeing the financial reporting process of

the Group.

Auditor's responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material

misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high

level of assurance, but is not a guarantee that an audit conducted in accordance with Standards on Auditing will always detect a material

misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they

could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Those Standards

require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial

statements are free from material misstatement.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Opinion

In our opinion, and to the best of our information and according to the explanations given to us, the aforesaid consolidated financial

statements give the information required by the Companies Act, 2013 (the 'Act') in the manner so required and give a true and fair view in

conformity with the accounting principles generally accepted in India, of their consolidated state of affairs of the Company as at March 31,

2016, of consolidated profit and its consolidated cash flows for the year then ended.


Other matters

We did not audit the financial statements of nine subsidiaries, whose financial statements reflect total assets of 4,920.18 Mn as at March

31, 2016, total revenues of 4,338.76 Mn and net cash outflows amounting to 474.73 Mn for the year ended on that date, as considered in

the consolidated financial statements. These financial statements have been audited by other auditors whose reports have been furnished to

us by management and our opinion on the consolidated financial statements, in so far as it relates to the amounts and disclosures included in

respect of these subsidiaries and our report in terms of section 143(3) and (11) of the Act, in so far as it relates to the aforesaid subsidiaries

is based solely on the reports of the other auditors.

Our opinion on the consolidated financial statements, and our report on other legal and regulatory requirements below, is not modified in

respect of the above matters with respect to our reliance on the work done and the reports of the other auditors.

Report on other legal and regulatory requirements

1. As required by section 143(3) of the Act, we report, to the extent applicable, that:

(a) we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary

for the purposes of our audit of the aforesaid consolidated financial statements;

(b) in our opinion, proper books of account as required by law relating to preparation of the aforesaid consolidated financial statements

have been kept so far as it appears from our examination of those books and the reports of the other auditors;

(c) the consolidated balance sheet, the consolidated statement of profit and loss, and the consolidated cash flow statement dealt with

by this report are in agreement with the relevant books of account maintained for the purpose of preparation of the consolidated

financial statements;

(d) in our opinion, the aforesaid consolidated financial statements comply with the Accounting Standards specified under section 133

of the Act, read with rule 7 of the Companies (Accounts) Rules, 2014;

(e) on the basis of the written representations received from the directors of the Holding Company as on March 31, 2016 taken on

record by the board of directors of the Holding Company and the reports of the statutory auditors of its subsidiary companies

incorporated in India, none of the directors of the Group companies, incorporated in India is disqualified as on 31 March 2016 from

being appointed as a director in terms of section 164(2) of the Act;

(f) with respect to the adequacy of the internal controls over financial reporting of the Holding Company and the operating

effectiveness of such controls, refer to our separate report in Annexure 'A'; and

(g) with respect to the other matters to be included in the Auditor's Report in accordance with rule 11 of the Companies (Audit and

Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

(1) the consolidated financial statements disclose the impact of pending litigations on the consolidated financial position of the

Group - refer note R of the consolidated financial statements;

(2) the Company has made provision, as required under the applicable law or accounting standards, for material foreseeable

losses, if any, on long-term contracts including derivative contracts — refer notes T(2) (ii) of the consolidated financial

statements; and

(3) there are no amounts required to be transferred to the Investor Education and Protection Fund by the Holding Company and

its subsidiary company incorporated in India— refer notes 1(10) of the consolidated financial statements.

Sharp & Tannan



by the hand of

Firdosh D. Buchia

Partner




ANNEXURE A' TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2(f) under 'Report on other legal and regulatory requirements' of our report of even date)

Report on the internal financial controls under clause (i) of sub-section (3) of section 143 of the Companies Act, 2013 ('the Act')

We have audited the internal financial controls over financial reporting of Larsen & Toubro Infotech Limited ('the Holding Company')

and its subsidiary company which is incorporated in India as of March 31, 2016 in conjunction with our audit of the standalone financial

statements of the Company for the year ended on that date.

Management's responsibility for internal financial controls

The respective board of directors of the Holding company and its subsidiary company which is incorporated in India, are responsible for

establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the

Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over

Financial Reporting (the 'Guidance Note') issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the

design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and

efficient conduct of its business, including adherence to the Company's 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,

as required under the Act.


Our responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on our audit.

We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, issued by ICAI and deemed to be

prescribed under section 143(10) of the Act, to the extent applicable, to an audit of internal financial controls, both applicable

to an audit of internal financial controls and both issued by the CAI. Those Standards and the Guidance Note require that we

comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate

internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all

material respects.

Our audit involved performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial

reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding

of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design

and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor's judgment,

including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company's

internal financial controls system over financial reporting.

Meaning of internal financial controls over financial reporting

A company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability

of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting

principles. A company's internal financial control over financial reporting includes those policies and procedures that: (1) pertain to the

maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the

company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in

accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in

accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention

or timely detection of unauthorised acquisition, use, or disposition of the company's assets that could have a material effect on the

financial statements.

Inherent limitations of internal financial controls over financial reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or

improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also,


projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that

the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of

compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such

internal financial controls over financial reporting were operating effectively as at March 31, 2016, based on the internal control over financial

reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note issued

by the 'CAI.

Sharp & Tannan



by the hand of

Firdosh D. Buchia

Partner



Tangible assets Intangible assets Capital work-in-progress Intangible assets under development

Non-current investments Deferred tax assets Long-term loans and advances

2,791.89 3,583.23

6.95 188.41

6.570.48

2.37 4,249.13

10.821.98

2,749.82 4,084.52

53.33 198.45

7,086.12

10.29 2,439.79 9,536.20

H(0


CONSOLIDATED BALANCE SHEET AS AT MARCH 31, 2016

(Z Million)

Note No.

Particulars As at

31-03-2016

As at 31-03-2015

EQUITY AND LIABILITIES Shareholders funds

Share capital Reserves and surplus

Total Equity Minority interest Non-current liabilities

169.82 20,057.02 20,226.84

5.18

161.25 20,102.23 20,263.48

3.88

Long-term borrowings Deferred tax liabilities Other long term liabilities Long term provisions

DLO

600 1,206.25 1,250.52

124.29 2,581.06

138.89 238.03 538.35 103.71

1,018.98 Current liabilities

Short-term borrowings Current maturities of long-term borrowings Trade payables Other current liabilities Short-term provisions

D(ii) D(j) E(1) E(ii)

397.53 147.23

3,276.40 2,764.95 5,170.88

11,756.99

1,897.48 138.89

2 719.47 1 723.48 2 815.44 9,294.76

TOTAL EQUITY AND LIABILITIES ASSETS

34,570.07 30,581.10

Non-current assets Fixed assets

Current assets Current investments Trade receivable Unbilled revenue Cash and bank Short-term loans and advances

429.20 11,659.87

3,787.89 2,033.66 5,837.47

23,748.09

1 035.51 10,901.16 1 544.50 2 009.21 5,554.52

21,044.90

TOTAL ASSETS 34,570.07 30,581.10

Significant accounting policies

A Contingent liabilities Commitments (capital and others) Notes formiquarty ascounts

As per our report attached SHARP & TANNAN Chartered Accountants Firm's Registration No. 109982W by the hand of

FIRDOSH D. BUCHIA

Sanjay lalona

R. Shankar Raman Ashok Kumar Sonthalia Subramanya Bhatt Partner Chief Executive Officer Director

Chief Financial Officer Company Secretary

Membership No: 38332

& Managing Director



Particulars

INCOME: Revenue from operations

58,470.60

49,780.36 Other income

2,959.61

915.00 Total income

61,430.21

50,695.36 EXPENSES: Employee benefit expenses Operating p( enses Sales, administration and other ex enses

35,346.58 6,710.80 6,057.07

48,114.45

29,242.73 4,885.63 5,607.43

39,735.79

OPERATING PROFIT Finance cost Depreciation on tangible assets Amortisation of intangible assets

13,315.76 103.57 736.67

1,002.85 1,843.09

10,959.57 104.19 741.55 837.85

1,683.59

Profit before extraordinary items and tax Profit from continuing operations before tax Extraordinary item T(8)

11,472.67 11,472.67

9,275.98 9,266.26

93.95 Profit from continuing operations before tax

11,472.67

9,360.21 Tax expense for continuing operations

Current tax (net) Deferred tax

1,649.17 600.44

2,249.61

1,645.32 35.76

1,681.08

Profit from continuing operations after tax Profit from discontinued operations before tax Tax expense for discontinued operations

T(8)

T(8)

T(4)

9,223.06 7,679.13 9.72

Current tax Profit from discontinued operations after tax PROFIT FOR THE YEAR BEFORE MINORITY INTEREST

Minority Interest PROFIT FOR THE YEAR EARNING PER EQUITY SHARE

9,223.06 1.29

9,221.77

1.69 8.03

7,687.16 1.90

7,685.26

Basic Basic earning per equity share before extraordinary items

56.26

47.17 Basic earning per equity share after extraordinary items

56.26

47.66 Diluted Diluted earning per equity share before extraordinary items

56.13

45.14 Diluted earning per equity share after extraordinary items

56.13

45.60 Face value per equity share

1.00

1.00 Significant accounting policies

A


CONSOLIDATED STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED MARCH 31, 2016

(Z Million)


As per our report attached SHARP & TANNAN Chartered Accountants Firm's Registration No. 109982W by the hand of

FIRDOSH D. BUCHIA

Sanjay Jalona

R. Shankar Raman Ashok Kumar Sonthalia Subramanya Shaft Partner


Director Chief Financial Officer Company Secretary Membership No: 38332

& Managing Director

Mumbai


April 26, 2016


CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2016

(Z Million)

A.

Particulars 2014-15

Cash flow from operating activities

Net profit before tax (excluding extraordinary items) 11,472.67 9,275.98

Adjustments for:

Depreciation and amortisation 1,739.52 1,579.41

Employees stock options amortised (141.59)

Interest (net) 41.17 33.42

Unrealised foreign exchange loss/(gain) (901.57) (568.72)

(Profit)/loss on sale of current investments (68.44) (141.26)

Miscellaneous expenditure amortised/(capitalised) 6.35

(Profit)/loss on sale of fixed assets 27.28 7.18

Translation Reserve 56.65 (80.26)

Operating profit before working capital changes 12,225.69 10,112.10

Changes in working capital

(Increase)/decrease in trade receivables and unbilled revenue (3,069.79) (1,979.71)

(Increase)/decrease in other receivables 11.08 (107.57)

Increase/(decrease) in trade & other payables 2,123.04 1,164.84

(Increase)/decrease in working capital (935.67) (922.44)

Cash generated from operations 11,290.02 9,189.66

Direct taxes paid (2,656.99) (2,767.12)

Net cash from operating activities (excluding extraordinary items) 8,633.03 6,422.54

B. Cash flow from investing activities

Purchase of fixed assets (1,290.54) (1,964.04)

Sale of fixed assets 149.38 25.13

(Purchase)/sale of current investments 674.75 793.52

Interest received 25.06 22.81

Net cash used in investing activities (before extraordinary items) (441.35) (1,122.58)

Extraordinary item

Proceeds from sale of PES Business(net) 93.95

Net cash used in investing activities (after extraordinary items) (441.35) (1,028.63)


CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2016

(Z Million)

Particulars 2014-15

C. Cash flow from financing activities

Issue of share capital (including share application) 69 28

Proceeds from/(repayment) of borrowings (1,662.61) 1,013.23

Interest paid (57.89) (56.23)

Dividend paid (5,467.30) (4,805.25)

Dividend tax (1,048.71) (1,125.56)

Net cash from financing activities (8,167.23) (4,973.81)

Net increase in cash and cash equivalents 24.45 420.10



Notes:

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

the Companies (Accounting Standards) Rules, 2006.

2 Purchase of fixed assets includes movements of capital work-in-progress during the year.

3 Cash and cash equivalents represent cash and bank balances.

4 Bank balances include revaluation gain of Z45.13 Mn (Previous year loss! 2.73 Mn).


FIRDOSH D. BUCHIA

Sanjay Jalona

R. Shankar Raman Ashok Kumar Sonthalia Subramanya Matt

Partner



& Managing Director

Mumbai

Mumbai

April 26, 2016

April 26, 2016


NOTES FORMING PART OF CONSOLIDATED ACCOUNTS

A. Significant Accounting Policies

1. Basis of accounting

These financial statements have been prepared in

accordance with the Generally Accepted Accounting

Principles in India ('Indian GAAP') to comply with the

Accounting Standards specified under Section 133 of the

Companies Act, 2013, read with Rule 7 of the Companies

(Accounts) Rules, 2014 and the relevant provisions of

the Companies Act, 2013. Further the guidance notes/

announcements issued by the Institute of Chartered

Accountants of India (ICA!) are also considered wherever

applicable. The Company maintains its accounts on

accrual basis following the historical cost convention.

The preparation of financial statements in conformity

with GAAP requires the management of the Company to

make estimates and assumptions that affect the income

and expense reported for the period and assets and

liabilities & disclosures relating to contingent liabilities

reported as of the date of the financial statements.

Examples of such estimates include carrying value of

tangible & intangible fixed assets, provision for doubtful

debts, future obligations in respect of retirement benefit

plans, etc. Difference, if any, between the actual results

and estimates is recognised in the period in which the

results are known.

The accounts of Indian subsidiaries have been prepared

in compliance with the Accounting Standards specified

under Section 133 of the Companies Act, 2013, read

with Rule 7 of the Companies (Accounts) Rules, 2014 and

the relevant provisions of the Companies Act, 2013, and

those of the foreign subsidiaries have been prepared in

compliance with the local laws and applicable Accounting

Standards. Necessary adjustments for differences in the

accounting policies, wherever applicable, have been

made in the Consolidated Financial Statements.

2. Presentation of financial statements

The balance sheet and the statement of profit and loss

are prepared and presented in the format prescribed in

the schedule III to the Companies Act, 2013. The cash

flow statement has been prepared and presented as per

the requirements of Accounting Standard (AS) 3 "Cash

Flow Statements". The disclosure requirements with

respect to items in the balance sheet and statement

of profit and loss, as prescribed in the schedule III to

the Act, are presented by way of notes forming part

of accounts along with the other notes required to be

disclosed under the notified Accounting Standards.

3. Principles of consolidation

a) The financial statements of the Parent Company

and its subsidiaries have been consolidated on

line-by-line basis by adding together the book

values of the like items of the assets, liabilities,

income and expenses, after eliminating intra-group

balances and the unrealised profits/losses on

intra-group transactions, and are presented to the

extent possible, in the same manner as the Parent

Company's independent financial statements.

b) Minority interest in the net assets of subsidiaries

consists of the amount of equity attributable to

the minority shareholders at the date on which

investment is made by company in the subsidiary

Company and further movements in their share in

the equity, subsequent to the date of investment.

c) Goodwill on consolidation represents the difference

between the Group's share in the net worth of a

subsidiary and the cost of acquisition at each point

of time of making the investment in the subsidiary

as per Accounting Standard (AS) 21 "Consolidated

Financial Statements". For this purpose, the

Group's share of net worth is determined on the

basis of the latest financial statements, prior to the

acquisition, after making necessary adjustments

for material events between the date of such

financial statements and the date of respective

acquisition. Goodwill arising on consolidation as

per Accounting Standard (AS) 21 "Consolidated

Financial Statements" is tested for impairment at

every balance sheet date. In the event of cessation

of operations of a subsidiary, the unimpaired

goodwill is written off fully.

4. Extraordinary items

Income or expenses that arise from events or transactions

that are clearly distinct from the ordinary activities of the

Company are classified as extraordinary items. Specific

disclosure of such events/transactions is made in the

financial statements. Similarly, any external event beyond

the control of the Company, significantly impacting

income or expense, is also treated as extraordinary item

and disclosed as such.

5. Revenue recognition

a) Revenue from contracts priced on time and material

basis are recognised when services are rendered

and related costs are incurred.


NOTES FORMING PART OF CONSOLIDATED ACCOUNTS (Contd.)

Revenue from services performed on "fixed-

price" basis is recognised using the proportionate

completion method.

Unbilled revenue represents value of services

performed in accordance with the contract terms

but not billed.

b) Other income

i. Interest income is accrued at applicable

interest rate.

Dividend income is accounted in the period

in which the right to receive the same is

established.

iii. Other items of income are accounted as and

when the right to receive arises.

6. Employee benefits

a) Short term employee benefits

All employee benefits falling due wholly within

twelve months of rendering the service are

classified as short term employee benefits. The

benefits like salaries, wages, and short term

compensated absences and performance incentives

are recognised in the period in which the employee

renders the related service.

b) Post-employment benefits

i) Defined contribution plan:

The Company's superannuation fund and

state governed provident fund scheme are

classified as defined contribution plans. The

contribution paid! payable under the schemes

is recognised during the period in which the

employee renders the related service.

ii) Defined benefit plans:

The provident fund scheme managed by

trust, employees gratuity fund scheme

managed by LIC and post-retirement medical

benefit scheme are the Company's defined

benefit plans. Wherever applicable, the

present value of the obligation under such

defined benefit plans is determined based on

actuarial valuation using the Projected Unit

Credit Method, which recognizes each period

of service as giving rise to additional unit of

employee benefit entitlement and measures

each unit separately to build up the final

obligation.

The obligation is measured at the present

value of the estimated future cash-flows.

The discount rates used for determining the

present value of the obligation under defined

benefit plans, is based on the market yields

on government bonds as at the balance sheet

date, having maturity periods approximating

to the terms of related obligations. Actuarial

gains and losses are recognised immediately

in the profit and loss account. In case of

funded plans, the fair value of the plan assets

is reduced from the gross obligation under

the defined benefit plans to recognize the

obligation on net basis.

Gains or losses on the curtailment or

settlement of any defined benefit plan

are recognised when the curtailment or

settlement occurs. Past service cost is

recognised as expense on a straight-line basis

over the average period until the benefits

become vested.

(iii) Long term employee benefits:

The obligation for long term employee

benefits like long term compensation

absences is recognised in the similar manner

as in the case of defined benefit plans as

mentioned in (b) (ii) above.

7. Fixed assets

Tangible

Fixed assets are stated at cost less accumulated

depreciation.

Intangible

Assets like customer relationship, computer software,

and internally developed software are stated at cost, less

accumulated depreciation & amortisation.

Goodwill on acquisition represents the cost of

acquired businesses in excess of the fair value of net

identifiable assets acquired. Goodwill is not amortised

but is tested for impairment if events or changes

in circumstances indicate that an impairment loss

may have occurred.



8. Investments

Long-term investments are stated at cost, less provision for

other than temporary diminution in value, if any. Current

investments are stated at the lower of cost or market

value, determined on the basis of specific identification.

9. Leases

Finance lease

Assets acquired under leases where the Company has

substantially all the risks and rewards of ownership are

classified as finance leases. Such assets are capitalised at

the inception of the lease at the lower of the fair value

and the present value of minimum lease payments and a

liability is created for an equivalent amount. Each lease

rental paid is allocated between the liability and the

interest cost, so as to obtain a constant periodic rate of

interest on the outstanding liability for each period.

Operating lease

Assets acquired under lease where a significant portion

of the risks and rewards of ownership are retained by the

lessor are classified as operating leases. Lease rentals are

charged to the profit and loss account on accrual basis.

10. Depreciation

A. Indian Companies:

I. Tangible - owned assets

Depreciation on assets has been provided

based on useful life prescribed in schedule

Ito the Companies Act, 2013 except for the

leasehold improvements which is depreciated

over the lease period.

Depreciation / amortization on additions /

disposals are calculated pro-rata from / to the

month of additions / disposals.

II. Tangible - leased assets

Assets acquired under finance leases are

depreciated at the rates applicable to similar

assets owned by the Company as there is

reasonable certainty that the Company shall

obtain ownership of the assets at the end of

the lease term.

Leasehold land - Over the residual period of

the lease

B. Foreign Subsidiaries

Depreciation has been provided on methods and at

the rates required/permissible by the local laws so

as to write off the assets over their useful life.

11. Intangible Assets and amortization

The basis of amortization of intangible assets is as follows:

• Computer software Over a period of 3 years

• Intellectual property rights Over a period of 3 years (IPR)

• Acquired software Over a period of 10 years

• Internally developed Over a period 1. to 5 years software

• Business rights Over a period of 5 years

• Customer contracts Over a period of 10 years

12. Employee stock ownership schemes

In respect of stock options granted pursuant to the

Company's stock option schemes, the excess of fair

value of the share over the exercise price of the option

is treated as discount and accounted as employee

compensation cost over the vesting period.

13. Foreign currency transactions

a) Foreign currency transactions are initially

recorded at the rates prevailing on the date of the

transaction. At the balance sheet date, foreign

currency monetary items are reported using the

closing rate. Non-monetary items which are carried

at historical cost denominated in foreign currency

are reported using the exchange rate at the date of

the transaction.

Translation of foreign currency transaction of

overseas branches & subsidiaries is as under:

Revenue items at the average rate for the

period;

Fixed assets and investments at the rates

prevailing on the date of the transaction; and

Other assets and liabilities at year end rates

Exchange difference on settlement / year

end conversion is adjusted to profit and loss

account.



b) Forward contracts other than those entered into

to hedge foreign currency risk on unexecuted

firm commitments or of highly probable forecast

transactions are treated as foreign currency

transactions and accounted accordingly. Exchange

differences arising on such contracts are recognised

in the period in which they arise and the premium

paid / received is accounted as expense / income

over the period of the contract.

Profit or loss on such forward contracts is accounted

as income or expense for the period.

c) All the other derivative contracts, including

forward contracts entered into to hedge foreign

currency risks on unexecuted firm commitments

and highly probable forecast transactions are

recognised in the financial statements at fair value

as on the balance sheet date. In pursuance of

the announcement of the Institute of Chartered

Accountants of India (ICAO dated March 29, 2008

on accounting of derivatives, the Company has

adopted Accounting Standard 30 for applying the

test of hedge effectiveness of the outstanding

derivative contracts. Accordingly, the resultant

gains or losses on fair valuation of such contracts

are recognised in the profit and loss account or

balance sheet as the case may be.

14. Taxes on Income

Tax on income for the current period is determined on

the basis of taxable income and tax credits computed

in accordance with the provisions of the Income Tax

Act, 1961 and based on the expected outcome of

assessments/appeals.

Deferred tax is recognised on timing differences between

the income accounted in financial statements and the

taxable income for the year, and quantified using the tax

rates and laws enacted or substantively enacted as on

the Balance Sheet date.

Other deferred tax assets are recognised and carried

forward to the extent that there is a reasonable

certainty that sufficient future taxable income will be

available against which such deferred tax assets can be

realised.

Foreign Subsidiaries

Foreign Subsidiaries recognise current tax/ deferred tax

liabilities and assets in accordance with the applicable

local laws.

15. Borrowing costs

Borrowing costs include interest, commitment charges,

finance charges in respect of assets acquired on finance

lease and exchange differences arising from foreign

currency borrowings, to the extent they are regarded as

an adjustment to interest costs.

16. Provisions, contingent liabilities and contingent assets

Provisions are recognised for liabilities that can

be measured only by using a substantial degree of

estimation, if

a) the Company has a present obligation as a result of

a past event;

b) a probable outflow of resources is expected to

settle the obligation; and

c) the amount of the obligation can be reliably

estimated

Reimbursement expected in respect of expenditure

required to settle a provision is recognised only when it is

virtually certain that the reimbursement will be received.

Contingent liability is disclosed in the case of:

a) a present obligation arising from a past event when

it is not probable that an outflow of resources will

be required to settle the obligation; or

b) a possible obligation unless the probability of

outflow of resources is remote

Contingent assets are neither recognised nor

disclosed.

Provisions, contingent liabilities and contingent

assets are reviewed at each balance sheet date.

17. Segment accounting

Segment accounting policies are in line with the

accounting policies of the Company. In addition, the

following specific accounting policies have been followed

for segment reporting:

a) Segment revenue includes sales and other income

directly identifiable with/allocable to the segment.



b) Expenses that are directly identifiable with/

allocable to segments are considered for

determining the segment result. Expenditure which

relate to the Company as a whole and not allocable

to segments are included under "unallocable

corporate expenditure".

c) Income which relates to the Company as a whole

and not allocable to segments is included in

"unallocable corporate income".

d) Fixed assets used and liabilities contracted for

performing the Company's business have not been

identified to any of the reported segments as the

fixed assets and services are used interchangeably

among segments.

18. Cash flow statement

Cash flow statement is prepared segregating the cash

flows from operating, investing and financing activities.

Cash flow from operating activities is reported using

indirect method. Under the indirect method, the net

profit is adjusted for the effects of:

transactions of a non-cash nature

ii any deferrals or accruals of past or future operating

cash receipts or payments and

iii. items of income or expense associated with

investing or financing cash flows.

Cash and cash equivalents (including bank balances) are

reflected as such in the cash flow statement.



A (II) Basis of preparation

The Consolidated financial statements (CFS), comprising the Company and its subsidiaries, are prepared in accordance with

Accounting Standard (AS) 21 — "Consolidated Financial Statements" as specified by the Companies (Accounting Standards) Rules,

2014. Reference in these notes to "the Company" shall mean Larsen & Toubro Infotech Limited and "the Group" shall mean the

Company and its subsidiaries.

A (Ill) The list of subsidiaries included in the consolidated financial statements are as under:-

Name of the subsidiary company Country of incorporation Proportion of ,

ownership as at

March 31, 2016

(%)

Proportion of

ownership as at

March 31, 2015

(°{0) 1 Larsen & Toubro Infotech Canada Limited Canada 100 100 2 Larsen & Toubro Infotech GmbH Germany 100 100 3 Larsen & Toubro Infotech LLC USA 100 100 4 L&T Infotech Financial Services Technologies Inc. Canada 100 100 5 Larsen And Toubro Infotech South Africa (Proprietary)

Limited

South Africa 74.9 74.9

L&T Information Technology Services (Shanghai) Co. Limited China 100 100 GDA Technologies Limited India 100 100 Information Systems Resource Centre Private Limited* India - 100 Larsen & Toubro Infotech Austria GmbH** Austria 100 -

10 L&T Information Technology Spain, Sociedad Limitada*** Spain 100 . ..

Refer note T(7)

The Company has formed a new entity "Larsen 84 Toubro Infotech Austria GmbH" in Austria on June 18, 2015. Investment in this entity is not denominated in number of shares as per the local laws of Austria.

The Company has formed a new entity "L&T Information Technology Spain, Sociedad Limitada in Spain on February 1, 2016.



A (IV) Additional disclosure as per schedule III of the Companies Act, 2013:

(!Million)

Net assets, i.e total assets minus total liabilities _

Share in profit

Name of the entity

As% of consolidated net

assets

Amount

As%of consolidated profit I

or loss

Amount

A - Parent Larsen & Toubro Infotech Limited 92.12% 18,632.71 _ 101.73% 9,381.31

Subsidiaries • I

B - Indian

GDA Technologies Limited 1.83% 370.75 0.20%! 18.37

Sub Total 1.83% 370.75 0.20% ' 18.37 C-Foreign I 1. Larsen & Toubro Infotech GmbH 1.39% 281.77 0.62% 56.76 2. Larsen & Toubro Infotech Canada Limited 0.50% 100.34 0.33% • 30.78 3. Larsen & Toubro Infotech LLC 0.56% 112.62 0.14% 12.47 4. L&T Infotech Financial Services

Technologies Inc.

16.17% 3,271.03 2.10% • 193.48 i

5. Larsen And Toubro South Africa (Proprietary) Limited

0.10% 20.65 0.06% ! 5.16

6. L&T Information Technology Services (Shanghai) Co. Limited

0.03% 5.24 0.03% 2.91 1

7. Larsen & Toubro Infotech Austria GmbH 0.01% 2.08 (0.01)% l

(0.51)

8. L&T Information Technology Spain,

Sociedad Limitada

0.02% 3.05 (0.01)%' (0.61)

Sub Total 18.77% 3,796.78 3.26% 300.44 Total A+B+C 112.72% 22,800.24 105.19% 9,700.11 Less : CFS adjustments and eliminations (12.72)% (2,573.40) (5.19)% I (478.34)

Total 100% 20,226.84 100% , 9,221.77

B. Share capital

B. (0 Share capital authorised, issued, subscribed and paid up:

As at 31-03-2016

As at 31-03-2015

Authorised:

240,000,000 equity shares of I each

240.00

163.75 (Previous year 32,750,000 of 5 each)

Issued, paid up and subscribed

169,816,188 equity shares for 1 each 169.82 161.25 (Previous year 32,250,000 of Z5 each)

EQUITY SHARE CAPITAL

169.82 161.25



Notes:

a) The board of directors at their meeting held on June 16, 2015 approved sub-division of the equity shares of face value of 5 each to

face value of 1 each. The shareholders approved the sub-division on June 22, 2015 at the extraordinary general meeting.

b) The authorised share capital of the Company was increased by 36.25 Mn comprising 36,250,000 equity shares of l each at the board

meeting held on June 16, 2015 and approved by the shareholders at the extraordinary general meeting held on June 22, 2015.

c) In accordance with the order of the Hon'ble High Court of Judicature at Bombay for amalgamating Information Systems Research Centre

Private Limited (refer note T(7)), the authorised share capital of the Company was increased by 40.00 Mn comprising 40,000,000

equity shares of l each on amalgamation.

B(ii) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of 1 per share. Each holder of equity shares is entitled to one vote

per share. The Company declares and pays dividend in Indian rupees.

B(iii) Shareholders holding more than 5% of equity shares as at the end of the year

Name of shareholder

As at 31-03-2016

As at 31-03-2015

Number of shares* Shareholding % Number of shares** Shareholdin %

Larsen & Toubro Limited 161,250,000 94.96% 32,250,000 100

" Face value of Z

s• Face value of 5

B(iv) Reconciliation of the number of equity shares and share capital

Due to allotment of shares on exercise of stock options by employees, there was a movement in share capital for the year ended

March 31, 2016.

As at

31-03-2016

As at

31-03-2015

Issued, subscribed and fully paid up equity shares outstanding at the beginning

Add: Shares issued on exercise of employee stock options

Issued, subscribed and fully paid up equity shares outstanding at the end

161,250,000

8,566,188

169,816,188

161,250,000

161,250,000

13(v) Shares reserved for issue under options outstanding as at the end of the year on un-issued share capital:

Particulars As at 31-03-2016 r-

* Number of Exercise price

equity shares to be issued as fully

paid

As at 31-03-2015

Number of

Exercise price equity shares to be issued as fully

aid

# Employee stock options granted and outstanding

under Employee Stock Ownership Scheme "ESOS

Plan"

82,660

2,350,106

393,003

2

1,873,467

25

10

143,650 $2.4 90,100 $12 Employees Stock Ownership Scheme — 2006 U.S.

Stock Option Sub-Plan ('Sub-Plan')

# Refer note no. B (ix)

* Face value of 1

** Face value of 15



B(vi) The aggregate number of equity shares allotted as fully paid up by way of bonus shares in immediately preceding five years ended

March 31, 2016 are Nil (previous period of five years ended March 31, 2015- Nil)

B(vii)The aggregate number of equity shares issued pursuant to contract, without payment being received in cash in immediately preceding

five years ended March 31, 2016 — Nil (previous period of five years ended March 31, 2015- Nil)

B(viii)(a) During the year ended March 31, 2016, the amount of interim dividend distributed to equity shareholder was 32.65 per share at

face value of 1 (Previous year Z149 per share at face value of! 5).

(b) The Directors recommended payment of final dividend of 2.60 per equity share of! 1 each on the number of equity shares

outstanding on the record date.

Provision for final dividend has been made in the books of account for 169,816,188 equity shares outstanding as at March 31, 2016

amounting to! 441.52 Mn.

B(ix) Stock option plans

1. Employee Stock Ownership Scheme ('ESOS Plan')

Under the Employee Stock Ownership Scheme (ESOS) 2,432,766 options are outstanding as at March 31, 2016. The grant of

options to the employees under ESOS is on the basis of their performance and other eligibility criteria. Each option entitles the

holder to exercise the right to apply for and seek allotment of one equity share of 1.

All vested options can be exercised on the first exercise date. The Nomination & Remuneration Committee had decided September

28, 2015 as the first exercise date. The details of the grants under the aforesaid scheme are summarised below:

ESOP Series 1,11 & Ill IV-XXI

01546 2014-15 5

2014-15 5 Face value (Z)

2 Grant Price (!) 25 2 10 3 Options granted and outstanding at the

beginning of the year

1,965,015 393,003 9,367,335 1,880,484

4 Options reinstated during the year * 3,500 454,580

5 Options granted during the year

6 Options cancelled/ lapsed during the year 34,000 1,064,326 7,017

7 Options exercised and shares allotted during

the year

1,851,855 6,407,483

8 Options granted and outstanding at the end

of the year

82,660 393,003 2,350,106 1,873,467

of which -

Options vested 82,660 393,003 340,666 970,917

Options yet to vest 2,009,440 902,550,

* The Company had lapsed unvested options with the employees who had resigned from the Company. Based on the legal advice, the Company has exercised its discretion in determining that the former employees in the United States will be allowed to exercise their deferred options

and accordingly, 258,080 options at face value of Z1 (51,616 options at face value of Z5) exercisable by such former employees have been re-

instated and vested.

The Company had erroneously lapsed 200,000 options at face value of Z1 (40,000 options at face value of Z5). Subsequently, the Company has decided that these options be restored and vested.



2. Employees Stock Ownership Scheme —2006 U.S. Stock Option Sub-Plan (`Sub-Plan')

The Company had instituted the Employees Stock Ownership Scheme — 2006 U.S. Stock Option Sub-Plan ('Sub-Plan') for the

employees and Directors of its erstwhile subsidiary, GDA Technologies Inc, USA. The term of option was 5 years from the date

of grant. As per vesting schedule, the options had to vest over a period of five years, subject to fulfilment of certain conditions

specified in the respective Option agreement. Each option entitles the holder to exercise the right to apply for and seek allotment

of one equity share of 1 each at an exercise price of USD 2.4 per share. Under the said plan, options granted and outstanding as

at the end of the year are 143,650 options, all of which are vested.

3. Employees Stock Options granted and outstanding as at the end of the year on unissued share capital represent options 2,576,416

(previous year 11,782,850) at face value of 1.

C. Reserves & surplus

(T Million)

As at 31-03-2015

C(i) General reserve

As per last balance sheet 4,490 26 4,490.26

Add: transferred from employee stock options outstanding 005

4,490.31 4,490.26

C(ii) Hedging reserve (net of tax) : [Note I]

Opening balance (366.97) (2,923.11)

Deduction/(addition) during the year (net) (2,328 06) 2,556.14

(2,695.03) (366.97)

C(iii) Securities premium account

Opening balance 1,181.24 1,181.24

Addition during the year 204.16

1,385.40 1,181.24

C(iv) Surplus statement of profit and loss

Opening balance 14,193,21 12,229.63

Add: Profit for the year 9,221.77 7,685.26

Less: Depreciation charged against retained earnings 12.27

Add : Deferred tax credit on depreciation charged to retained earnings 2.17

23,414.98 19,904.79

Less: Appropriation

(a) Proposed dividend 441.52

(b) Interim dividend 5,467.30 4,805.25

(c) Tax on dividend 1,048.71 906.32

(d) Additional tax on dividend 58.02

16,399.43 14,193.22

C(v) Foreign currency translation reserve

Opening balance 266.07 631.60

AddAless):for the year 157.52 (365.53)

423.59 266.07

C(vi) Employee stock options outstanding

As per last balance sheet 338.41 338.41

Less : deductions during the year 285.04

Less: transferred to general reserve 0.05

53.32 338.41

RESERVES & SURPLUS 20,057.02 20,102.23



D. Borrowings

(!Million)

-211.

Non current Current Total Non current Current Total

D(1) Long-term borrowings

Secured loans*

Term loans from bank

(Refer note D(iii)) - 147.23 147.23 138.89 138.89 277.78

- 147.23 147.23 138.89 138.89 277.78

D(ii) Short-term borrowings _ Secured loans *

Other loans from banks - 132.51 132.51 - 600.00 600.00

Unsecured loans

Other loans from banks - 265.02 265.02 - 1,297.48 1,297.48

- 397.53 397.53 - 1,897.48 1,897.48

Total - 544.76 544.76 138.89 2,036.37 2,175.26

* The secured loans from banks are secured against hypothecation of the Company's movable assets and accounts receivables.

D(iii) Details of term loans

Rate of interest

Terms of repayment of term loan ature of term loan

Million

External commercial borrowings (ECB) 147.23 USD LIBOR (3 months) + Repayable in equal half-yearly instalments

2.5% of USD 1.11 million each commencing

from 19 October 2012 and ending on 14

October 2016.

Previous year (277.78)

E. Liabilities

(T Million)

As at 31-03-2016

As at 31-03-2015

Non-current Current Total Non-current Current Total

E(i) Trade payables

Due to holding company - - - 174.22 174.22

Due to others 3,276.40 3,276.40 - 2,545.25 2,545.25

3,276.40 3,276.40 - 2,719.47 2,719.47

E(ii) Other payables

Forward contract payable 1,148.52 1,574.11 2,722.63 447.46 89.22 536.68

Interest accrued but not due

on borrowings

- 1.08 1.08 - 2A1 2A1

Unclaimed dividend - 0.62 0.62 - - _

Other payables 102.00 1,189.14 1,291.14 90.89 1,631.85 1,722.74

1,250.52 2,764.95 4,015.47 538.35 1,723.48 2,261.83

1,250.52 6,041.35 7,291.87 538.35 4,442.95 4,981.30



F. Provisions:

F(i) - Provisions for employee benefits

(!Million)

Non-current

As at 31-03-2016 Current

86.76

As at 31-03-2015 Total Non-current Current Total

F(i) Gratuity - 86.76 - 97.33 97.33 Compensated absences - 507.16 507.16 - 455.72 455.72 Post-retirement medical 124.29

benefits

0.24 124.53 103.71 0.24 103.95

Others - 4,046.57 4,046.57 - 2,236.75 2,236.75 124.29 4,640.73 4,765.02 103.71 2,790.04 2,893.75

F(ii) Other provisions

Proposed equity dividend 441.52 441.52 - - _

Additional tax on dividend 58.02 58.02 - - - Income tax 19.91 19.91 - 14.70 14.70 Others * 10.70 10.70 10.70 10.70

- 530.15 530.15 - 25.40 25.40 Total 124.29 5,170.88 5,295.17 103.71 2,815.44 2,919.15

F (iii) * Disclosure pursuant to Accounting Standard (AS) 29 "Provisions, Contingent Liabilities and Contingent Assets"

Movement in provisions:

(T Million)

Sr. No

1

Particulars

Balance as at 1-4-2015

Class of provisions _ . Others Total

4.00 6.70 10.70 2 Additional provision during the year - - 3 Provision used during the year - - 4 Provision reversed during the year - _ - 5 Balance as at 31-03-2016 4.00 6.70 10.70

Nature of provisions:

i) Provision for sales tax pertains to claim made by the authorities on certain transaction of capital nature for the year 2002-03.

ii) Provision for others represents liabilities relating to matters in dispute.

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G. Fixed Assets

(T Million)

Fixed and Intangible Assets

Gross Block Depreciation/Amortisation Net Block Net Block Mat

01•Apr-15 Additions Deductions Foreign

currency translation

reserve

As at 31-Mar-16

Mat 01-Apr-15

For the year

On Deductions

Foreign currency

translation reserve

Mat 31-Mar-16

As at Mat

31-Mar-16 31-Mar-15

Tangible Assets

Leasehold Land 12.27 • - • 12.27 2.63 0.13 - • 2.76 9.51 9.64 Buildings 207.38 - - - 207.38 81.61 8.40 • - 90.01 117.37 125.77 Leasehold Improvements 296.19 68.32 15.95 • 348.56 61.91 35.65 3.22 - 94.34 254.22 23418 Plant and machinery 987.76 96.41 229.06 - 855.11 343.72 89.69 130.50 - 302.91 552.20 644.04 Computers

a. Owned 2,296.88 478.61 95.18 12.02 2,692.33 1,754.27 323.45 94.08 10.02 1,993.66 698.67 542.61 b. Leased 22.61 - 22.61 - - 22.61 - 22.61 • - • -

Office Equipments 896.47 119.22 127.00 - 888.69 601.28 110.74 124.21 - 587.81 300.88 295.19 Furniture and fixtures 1,239.67 97.98 162.11 1.73 1,177.27 629.36 112.12 138.75 0.95 603.68 57339 610.31 Vehides 446.76 92.08 70.76 • 468.08 158.78 56.49 32.64 - 182.63 285.45 287.98 Capital Work in Progress - - - - - - - - • 6.95 53.33 Total Of tangible assets 6,405.59 952.62 722.67 13.75 6,649.69 3,656.17 736.67 546.01 10.97 3,857.80 2,798.84 2,803.15 Total of tangible assets (Previous year) 6,133.30 722.29 416.85 32.75 6,405.99 3,308.67 753.83 385.62 (20.71) 3,656.17 2,803.15 2,889.08

Intangible Assets

Goodwill on acqusition 334.55 - - 14.99 34934 - • - - - 349.54 334.55 Goodwill on consolidation 628.05 - - - 628.05 • - • - - 628.05 628.05 Software 4,897.11 394.35 5.83 137.95 5,423.58 2,359.08 899.34 5.83 69.31 3,32190 2,101.68 2,538.03 Customer contracts 1,015.46 - - 4531 1,060.97 431.57 103.51 - 21.93 557.01 503.96 583.89 Business Rights 98.05 - • - 9&05 98.05 • - • 98.05 - - Intangible assets under development - - • - - - - - - 188.41 198.45 Total of intangible assets 6,973.22 394.35 5.83 198.45 7,560.19 2,888.70 1,002.85 5.83 91.24 3,976.96 3,771.64 4,282.97 Total of intangible assets (Prevkius year) 6,123.56 1,521.23 200.12 (471.44) 6,973.22 2,424.51 837.85 199.04 (174.62) 2,888.70 4,282.97 4,165.85

1. Impairment upto 31-03-2016 - NIL

2. Additions during the year & capital work-in-progress include Nil (previous year Nil) being borrowing cost capitalised in accordance with Accounting Standard (AS) 16 on "Borrowing Costs" prescribed under section 133 of the Companies Act, 2013, read with rule 7 of the Companies (Accounts) Rules, 2014.

3. Consequent to the adoption of schedule II to the Companies Act, 2013, the depreciation for the year ended March 31, 2015 is higher and the profit before tax is lower by 69.21 Mn. Further, an amount of ? 12.27 Mn (additional deferred tax charge of! 0.73 Mn) representing the carrying amount of assets with revised useful life as nil, has been

charged to the opening reserves as on April 1, 2014 pursuant to the provisions of the Companies Act, 2013.

4. During the previous year ended March 31, 2015, a subsidiary company changed the useful life of an intangible asset named as Pendo system from 5 years to 1 year. Owing to change in the useful life, the amortisation for the year ended March 31, 2015 is higher and profit before tax is lower by! 19.84 Mn and for the year ended March 31, 2016 is higher and profit before tax is lower by 10.70 Mn.



H. Investments

(Z Million)

As at 31-03-2015

As at 31-03-2016

H(i) Non-current investments

Trade investments (at cost)

Long term investment

100,000 fully paid equity shares of USD 1 (T 53) each in Pan Health, U.S.A.

Total non-current investments

H(ii) Current investments

(Z Million)

Particulars/ Scheme name Face Value

per unit

Units as at 31-03-2016

Amount as at 31-03-2016

_ Amount as at

31-03-2015

Liquid investments - quoted

Birla Sun Life Cash Plus — DDR 100 369,518.38 37.02

Reliance Medium Term Fund — MDR 10 2,794,062.26 30.33 -

L&T Liquid Super IP DDR 1000 - 202.13 Templeton India Ultra Short Bond Fund- Super IP-D 10 - 100.00 Templeton India TMA - Super IP- DDR 1000 - 100.14 Religare Invesco Liquid Fund - DDR 1000 100.04 IDFC Ultra Short Term Fund - Reg - DDR 10 100.00 L&T Ultra Short Term Fund - Daily Dividend

Reinvestment Plan

10.1660 - 60.26

L&T Liquid Fund - Daily Dividend Reinvestment Plan 1,011.6349 - 10.08 Franklin India Savings Plus Fund 11.0640 0.01 _

Franklin Templeton IUSFB-Super IP 61.28 57.61 L&T Liquid Fund- DDR 300.56 285.24 Total (A) 429.20 1,015.51

Fixed maturity plans - quoted

UTI Fixed Term Income Fund Series XVIII - X (366 days)-

Growth

10 20.00

Total (B) - 20.00

Total (A+B) 429.20 1,035.51

Less : Diminution in value of investments - _

Grand total 429.20 1,035.51

Market value of investments 429.36 1,037.02



I. Deferred tax liabilites/ assets

I(i) Deferred tax liabilities

Million Particulars Deferred tax asset

/ (liability) as at March 31, 2015

Current year (charge) / credit

(Charge) / credit to Deferred tax asset/

hedging reserve (liability) as at March 31, 2016


Depreciation / amortisation (411.15) 130.50 _ - (280.65) Gain on derivative transactions (304.09) - 121.16 (182.93) Branch profit tax (323.40) (103.53) - (426.93) Premia on derivative transaction - (570.42) - (570.42) Others _ - (1.41) (1.41) Total (1,038.64) (544.86) 121.16 (1,462.34) Deferred tax assets _ Non capital losses and deferred expenses 234.65 (169.43) - 65.22 Provision for doubtful debts and advances 7.19 24.07 - 31.26 Provision for employee benefits 60.50 37.23 - 97.73 Loss on derivative transactions 498.30 - (487.70) 10.60 Realised gain on derivative transaction - 41.36 - 41.36 Others (0.03) 9.95 9.92 Total 800.61 (56.82) (487.70) 256.09 Net deferred tax assets/(liabilities)14 (238.03) (601.68)_ (366.54) (1,206.25)

I(ii) Deferred tax assets

Million Particulars Deferred tax asset/

(liability) as at March 31, 2015

Current year (charge) / credit

(Charge) / credit to Deferred tax asset/

hedging reserve (liability) as at

, March 31, 2016


Depreciation / amortisation 0.69 (0.69) - . Allowance on income received in advance (2.27) - (2.27) Total (1.58) (0.69) - (2.27) Deferred tax assets

Provision for employee benefits 3.53 (1.49) - 2.04 Income received in advance 2.34 - 2.34 Depreciation / amortisation 5.72 (5.72) . Others 0.28 (0.02) - 0.26 Total 11.87 (7.23) 4.64 Net deferred tax assets/(liabilities)(B) 10.29 (7.92) - 2.37 Net deferred tax assets/(liabilities)(A+8) (227.74) (609.60) (366.54) (1,203.88) Exchange (gain)/loss on translation (9.16)

Net deferred tax assets/(liabilities) as per

statement of profit and loss

(600.44) .



J. Trade receivables and unbilled revenue

(T Million)

As at 31-03-2016 As at 31-03-2015

J(i) Trade receivables

Unsecured

Debts outstanding for a period exceeding six months

Considered good 327.30 65.16

Considered doubtful 160.69 175.30

487.99 240.46

Other debts

Considered good

- Due from holding company 450.38

- Due from fellow subsidiaries 53.40 87.91

- Others 10,828.79 10,748.08

11,332.57 10,836.00

Less: Provision for doubtful debts (160.69) (175.30)

11,659.87 10,901.16

J(ii) Unbilled revenue

Unbilled revenues comprise revenue recognised in relation to services performed in accordance with contract terms but not billed.

K. Cash and bank

(Z Million)

As at 31-03-2016 As at 31-03-2015

Cash and cash equivalent

Cash on hand 0.62 0.67

Balances with bank

- in current accounts

Overseas 1,120.98 1,078.30

Domestic 223.49 235.72

Remittances in transit 94.82 221.58

Fixed deposits (maturity less than 3 months) 322.09 125.57

1,762.00 1,661.84

Other bank balance

- in deposit accounts

Fixed deposit with bank with more than 3 months but less than 12 months maturity 245.90

- Earmarked balances with banks-unclaimed dividend 0.62

*Cash and bank balance not available for immediate use 25.14 347.37

2,033.66 2,009.21

*Other bank balance not available for immediate use being in nature of security for guarantees issued by bank on behalf of the Company, collaterals etc.



L. Loans and advances (Z Million)

Non-current

As at 31-03-2016

Current As at 31-03-2015

Total Non-current Current Total

Unsecured

Considered good

Loans against mortgage of house

property - - - 0.10 0.10

Premia on forward contracts 1,280.43 2,385.73 3,666,16 874.90 1,723.63 2,598.53

Interest receivable 1.81 1.81 - 6.86 6.86

Deposits 393.14 155.20 548.34 372.39 126.43 498.82

Capital advances 1.25 - 1.25 6.64 - 6.64

Advance tax (net of provision) - 88.68 88.68 35.65 163.04 198.69

Advances recoverable in cash or 2,574.31

in kind

3,206.05 5,780.36 1,150.21 3,534.46 4,684.67

- Considered doubtful - 6.06 6.06

Less : Provision for bad & doubtful - loans & advances

(6.06) (6.06)

4,249.13 5,837.47 10,086.60 2,439.79 5,554.52 7,994.31

M.

N.

0.

Revenue (Z Million)

2015-16 2014-15

Overseas 55,070.41 47,704.46

Domestic 3,400.19 2,075.90 58,470.60 49,780.36

Other income (Z Million)

2014-15

141.26 Income from current investment in mutual funds 68.44

Interest received 25.06 22.81

Foreign exchange gain/(loss) 2,795.57 667.81

Provision no longer required for doubtful debts 1.08

Miscellaneous income 69.46 83.12 2,959.61 915.00

Expenses (Z Million)

2015-16 2014-15

0(i) Employee benefit expenses

Salaries including overseas staff expenses 33,997,84 28,056.30

Staff welfare 865.95 799.93

Contribution to provident and other funds 344.99 249.93

Contribution to superannuation fund 52.05 44.71

Contribution to gratuity fund 85.75 91.86 35,346.58 29,242.73



(7 Million)

2014-15

0(ii) Operating expenses

Communication expenses 191.68 168.11

Lease finance charges 53,97 112.16

Consultancy charges 4,032.97 3,458.95

Cost of software packages for own use 450.06 403.65

Cost of bought-out items for resale 1,982.12 742.76

6,710.80 4,885.63.

(7 Million)

015- 2014-15

0(iii) Sales, administration and other expenses

Travelling and conveyance 1,409.02 1,202.05

Rent and establishment expenses 1,591.39 1,459.43

Telephone charges and postage 377.84 344.52

Legal and professional charges 585.27 562.58

Printing and stationery 25.88 29.21

Advertisement 115.49 92.69

Entertainment 72.37 57.29

Recruitment expenses 147.69 132.70

Repairs to building 199,36 135.43

Repairs to computers 65.97 93.16

General repairs and maintenance 320.36 253.51

Power and fuel 347.92 290.26

Equipment hire charges 12.90 10.19

Insurance charges 162.91 165.74

Rates and taxes 204.40 358.46

Allowance for doubtful debts and advances 30.29 190.47

Bad debts 51.93 39.13

Less: Provision written back (50.95) (39.13)

Commission paid 6 99 0.62

Books, periodicals and subscriptions 19.79 29.09

Directors fees 1.43 0.93

Commission to directors 5.81 3.60

Loss on sale of fixed assets 27.28 7.18

Miscellaneous expenses 325.80 181.98

Amortisation of cost of long term projects* 6.35

6,057.07 5,607.43

* Cost incurred for long term projects mainly comprise of legal and employee related costs to secure long term projects. These costs are amortised over a period of two years commencing from the date of securing the project.



P. Finance cost

(Z Million)

2014-15

P(i) Interest expenses 31.90 46.94

On others 25.99 9.29

57.89 56.23 P(ii) Exchange loss on borrowings (net) 45.68 47.96

103.57 104.19

Q. Provision for taxation

(Z Million)

2014-15

Current tax L,097.81 2,141.09

MAT credit entitlement for current year (1,086.70) (505.04)

Capital gains tax on sale of PES Business Unit 14.87

Provision for earlier years 38.06 (5.60)

Total current taxes 1,649 17 1,645.32

The Central Board of Direct Taxes (CBDT) has notified the Income Computation and Disclosure Standards (ICDS) with effect from April 1,

2015 for companies resident in India and shall accordingly apply for assessment year 2016-17 onwards. Accordingly, the Company has

accounted for the impact of ICDS in its tax computation.

R. Contingent liabilities

1. Income tax liability that may arise in respect of which the Company is in appeal *

2. Corporate guarantee given on behalf of subsidiary **

3. Service tax refund disallowed, in respect of which the Company is in appeal #

4. Sales tax liability, in respect of which the Company is in appeal

5. Legal notice served by a vendor for unpaid dues, disputed by the Company

1,343.99 1,167.47

5,998 76 5,395.70

12.48 4.52

1 28 1.28

0 02 0.02

7,356.53 6,568.99

* Out of contingent tax liability disclosed above, 1,280.69 Mn (including interest of! 202.48 Mn), pertains to the tax demand arising on account of

disallowance of exemption under section 10A on profits earned by STPI Units on onsite export revenue. Company is pursuing appeal against these demands before the relevant Appellate Authorities.

The Company believes that its position is likelyto be upheld by appellate authorities and considering the facts, the ultimate outcome of these proceedings

is not likely to have material adverse effect on the results of operations or the financial position of the Company.

Out of the total income tax liability, 5.19 Mn (including interest of Z0.65 Mn) pertains to a wholly owned subsidiary incorporated in Canada. The Canada

Revenue Agency ("CRA") had conducted a tax audit for the three years ending March 31, 2013 and has disallowed/reallocated certain expenses due to which

carry forward non-capital losses have been reduced. Since the company has carry forward losses, the taxable income should have been offset against the

carry forward losses resulting in nil taxable income and no interest payable.

A notice of objection ("N00") has been filed with Chief of Appeals, Canada Revenue Agency and the company is confident that the disallowed expenses will

be allowed as a deductible expense. Consequently income tax may not be payable for the three years ending March 31, 2013.

** The Company has given a corporate guarantee on behalf of its wholly owned subsidiary L&T Infotech Financial Services Technologies Inc. The guarantee is for performance of all obligations by L&T Infotech Financial Services Technologies Inc. Canada in connection with the long term annuity services contracts obtained by them. The obligation under this guarantee is limited in aggregate to the amount of CAD 70,000,000.



The Company has given a corporate guarantee on behalf of its subsidiary Larsen And Toubro Infotech South Africa (Proprietary) Limited.

The guarantee is for performance of all obligations by Larsen And Toubro Infotech South Africa (Proprietary) Limited in connection with

the Application Testing Service contract. The obligation under this guarantee is limited in aggregate to the amount of USD 31,414,785.

The Company has given a corporate guarantee on behalf of its subsidiary, Larsen And Toubro Infotech South Africa (Proprietary) Limited.

The guarantee is for performance of all obligations by Larsen And Toubro Infotech South Africa (Proprietary) Limited in connection with

software development services & related services. The obligation under this guarantee is limited in aggregate to USD 5,000,000.

# The Company had filed refund of accumulated service tax credit in accordance with relevant CENVAT Credit Rules. However, the

department has disallowed certain portion of such refunds considering the same as ineligible as not related with export and output

services. The Company is in appeal against these disallowances before the relevant Authorities and is hopeful of getting a favourable

order.

S. Estimated amount of contracts remaining to be executed on capital account (net of advances) and not provided for: 131.87 Mn

(previous year: 310.76 Mn)

1(1) Employee benefits

a) The amounts recognised in balance sheet are as follows

(!Million)

A. a)

Present value of defined benefit obligation as on March 31, 2016

As at March Gratuity plan

312016 (March Post retirement medical benefit

plan

31,2015) Self managed

provident fund

plan

- Wholly funded 589.94 - 4,253.92 (507.19) (-) (3,776.10)

- Wholly unfunded - 124.53 -

(-) (103.95) (-) 589.94 124.53 4,253.92

(507.19) (103.95) (3,776.10) b) Fair value of plan assets as on March 31, 2016 498.26* - 4,264.26 *

(409.85). (-) (3,778.70) Amount to be recognised as liability or (asset) (a-b) 91.68 124.53 (10.34)

(97.34) (103.95) (2.60) B. Amounts reflected in the balance sheet

Liability 91.68 124.53 55.66 (97.34) (103.95) (46.59)

Assets -

(-) (-) (-) Net liability/(asset) 91.68 124.53 55.66 #

(97.34) (103.95) (46.59) Net liability/(asset)-current 91.68 0.24 55.66

(97.34) (0.24) (46.59)

Net liability/(asset)- non current 124.29 .

(-) (103.71) _ (-)

* Asset is not recognised in the balance sheet. # Employer's and employee's contribution for March 2016 paid in April 2016.



b) The amounts recognised in statement of profit and loss are as follows:

(!Million)

. Current service cost

Gratuity plan Post-retirement

medical benefit

plan

21.99

Self-managed , provident fund

plan 91.34 257.11

(79.09) (18.66) (232.40) 2. Interest cost 43.07 9.94 315.53

(4/.55) (9.66) (252.26) 3. Expected return on plan assets -27.86 -315.53

(-27.20) (-) (-252.26) 4. Actuarial losses / (gains) -15.48 -11.13 -

(11.11) (-12.94) (-42.43) 5. Total expense for the year included in staff cost 91.07 20.80 257.11

(104.55) (15.38) (189.97)

c) The changes in the present value of defined benefit obligation representing reconciliation of opening and closing balances thereof

are as follows:

(Z Million)

Opening balance of the present value of defined benefit obligation

Gratuity plan

507.19

Post-retirement

medical benefit

plan

103.95

Self-managed

provident fund

plan

3,776.10 (408.57) (88.79) (3,412 68)

Add : current service cost 91.34 21.99 257.11 (77.00) (18.66) (232.40)

Add : interest cost 43.07 9.94 315.53 (40.67) (9.66) (252.26)

Add : contribution by plan participants 580.57

(-) (-) (456.33)

Add/(Less) : actuarial (gains)/losses -2.39 -11.13 -

(16.09) (-12.94) (-42.43) Add : business combination/acquistion

(10.20) (-) (-) Less: other adjustments (refer note below (d)) 181.75

(-) (-) (-) Add : liabilities assumed on acquisition/(settled on divestiture) 5.12

(-) (-) (-221.93) Less : benefits paid 54.39 0.22 493.64

(45.34) (0.22) (313.21) Closing balance of the present value of defined benefit obligation 589.94 124.53 4,253.92

(507.19) (103.95) - 13,776.10)



d) Changes in the fair value of plan assets representing reconciliation of the opening and closing balances thereof are as follows:

(Z Million)

Opening balance of the fair value of the plan assets

Gratuity plan

20154612014-15)

Self-managed provident fund

plan

409.85 3,778.70

(379.19) (3,352.80) 315.53 Add : expected return on plan assets 27.86

(26.67) (252.26) Add/(Less) : actuarial gains/(losses) 13.09 26.56

(5.47) (19.23) Add : contribution by the employer 96.73 244.32

(38.60) (228.83) Add: business combination/acquistion -

(5.26) (-1 Less: other adjustments (refer note below (d)) 181.75

(-) (-) Add : assets acquired on acquisition/(distributed on divestiture) 5.12

(-) (215.38) Add : contribution by plan participants 574.54

(-) (454.17) Less : benefits paid 54.39 493.64

(45.34) (313.21) Closing balance of the plan assets 498.26 4,264.26

(409.85) (3,778.70)

The Company expects to contribute 86.76 Mn (previous year: 97.33 Mn) towards its gratuity.

The Company's share of defined benefit obligation/fair value of plan assets adjusted by the Trust of the holding company.

e) The major categories of plan assets as a percentage of total plan assets are as follows:

2015-16 (2014-15) Gratuity plan Self-managed

provident fund plan

Government of India securities

25.3%

(24.7%) State government securities

15.8%

Scheme

with

LIC

Corporate bonds

Fixed deposits under Special Deposit Scheme framed by Central Government for provident funds

(15.1%) 10.3%

(7.6%)

9.3%

(10.3%) 39.3% Public sector bonds

(42.3%)

Effect on the aggregate of the service cost and interest cost

Effect on defined benefit obligation

7.93

(6.85)

22.86

(19.22)

-6.06

(-5.24)

-17.85

(-15.01)

2015-16 2014-15

Defined benefit obligation

124.53

103.95



Principal actuarial assumptions at the balance sheet date (expressed as weighted averages):

2015-16 2014-15

1 Discount rate as at March 31

For gratuity

7.75%

7.90%

For post -retirement medical benefits

7.75%

7.90%

2 Annual increase in healthcare costs (see note below)

5.0% 5.0%

3 Attrition rate: Varies between 2% Varies between 2%

to 18% for various to 18% for various

age groups age groups

4 Salary growth rate 5.0% 5.0%

The estimates of future salary increases considered in actuarial valuation, take into account inflation, seniority, promotion and other

relevant factors, such as supply and demand in the employment market.

Although the obligation of the Company under the post-retirement medical benefit plan is limited to the overall ceiling limits, assumed

healthcare cost trend rates may affect the amounts recognised in the statement of profit and loss. At present, healthcare costs, as

indicated in the principal actuarial assumption given above, are expected to increase at 5% p.a. A one percentage point change in

assumed healthcare cost trend rates would have the following effects on the aggregate of the service cost and interest cost and defined

benefit obligation:

(7 Million)

Effect of 1% Increase

1% decrease

a) The amounts pertaining to defined benefit plans for the current year are as follows:

Post-retirement medical benefit plan (non-funded)

(7 Million)

2011-12

42.19

Gratuity plan

(7 Million)

2015-16 2014-15 2013-14 2012-13 2011-12

1 Defined benefit

obligation

589.94 507.19 408.57 384.12 297.59

2 Plan assets 498.26 409.85 379.19 296.11 156.90

3 (Surplus)/deficit 91.68 97.34 29.38 88.01 140.69

2013-14

88.79

2012-13

90.81



Self-managed provident fund plan

(Z Million)

6 2014-15 2013-14 2012-13 2011-12

1 Defined benefit

obligation

4,t53.92 3,776.10 3,412.68 2,710.62 2,178.30

2 Plan assets 4,264.26 3,778.70 3,352.80 2,685.76 2,142.59

(Surplus)/deficit (10.34) (2.6011 59.88 24.86 35.71

Experience adjustments Gratuity

(Z Million)

589 94

2014-15 2013-14, 2012-13, 2011-12

Defined benefit obligation 507.19 408.57 _ 384.12 297.59

Plan assets 498 7.:6 409.85 379.19 296.11 156.90

(Surplus) / deficit 9166 97.34 29.38 . 88.01 140.69

Experience adjustments on

plan liabilities (7.53) (13.91) (6.21) _ 5.05 _ 95.81

Experience adjustments on

plan assets 13.09 6.04 8.19 8.56 2.34

General descriptions of defined benefit plans:

a) Gratuity plan

The Company makes contributions to the Employees' Group Gratuity-cum-Life Assurance Scheme of the Life Insurance Corporation

of India, a funded defined benefit plan for qualifying employees. The scheme provides for lump sum payment to employees

at retirement, death while in employment or termination of employment of an amount equivalent to 15 days salary for every

completed year of service or part thereof in excess of six months, provided the employee has completed five years in service.

b) Post-retirement medical benefit plan

The post-retirement medical benefit plan provides for reimbursement of health care costs to certain categories of employees post

their retirement. The reimbursement is subject to an overall ceiling limit sanctioned at the time of retirement. The ceiling limits

are based on cadre of the employee at the time of retirement.

c) Self-managed provident fund plan

The Company's provident fund plan is managed by its holding company through a Trust permitted under the Provident Fund Act,

1952. The plan envisages contribution by employer and employees and guarantees interest at the rate notified by the Provident

Fund Authority. The contribution by employer and employee together with interest are payable at the time of separation from

service or retirement whichever is earlier. The benefit under this plan vests immediately on rendering of service.

The interest payment obligation of trust managed provident fund is assumed to be adequately covered by the interest income on

long term investments of the fund. Any shortfall in the interest income over the interest obligation is recognised immediately in

the Statement of Profit and Loss as actuarial loss. Any loss arising out of the investment risk and actuarial risk associated with the

plan is also recognised as expense in the period in which such loss occurs. Further, on amount of Z Nil has been provided based on

actuarial valuation towards the future obligation arising out of interest rate guarantee associated with the plan.

T(2)(i) In line with the Company's Financial Risk Management Policy, financial risks relating to changes in the exchange rates are hedged

by forward contracts, besides the natural hedges. The loss on fair valuation of the derivative contracts which are designated and

are effective as hedges, amounting to Z 2,695.02 Mn (net of deferred tax) (Previous year Z 366.96 Mn (net of deferred tax)) has

been accounted in retained earnings in balance sheet. The loss/(gain) of Z (1,297.52) Mn (Previous year gain of Z 243.04 Mn) on

settlement of the forwards is recognised in statement of profit and loss.



The particulars of derivative contracts entered into for hedging foreign currency risks outstanding as at March 31, 2016 are as under:

(Z Million)

Sr. Category of derivative instruments Notional amount March 31, 2015

a) Forward contracts for receivables 58,583.85

Notional amount March 31, 2016

43,470.51

Un-hedged foreign currency exposures as at March 31, 2016 are as under:

Sr. Un-hedged foreign currency exposures

1 Receivables including firm commitments and highly probable forecast transactions

2 Payables including firm commitments and highly probable forecast transactions

March 31, 2016

41,271.25

28,796.36

March

(!Million)

31, 2015

30,013.24

24,474.93

1(2) (ii) The Company has made provision, as required under the applicable law or accounting standard for material foreseeable losses on

long term derivative contracts

T(3) Leases

Finance leases

In accordance with Accounting Standard 19 "Leases" issued by the Institute of Chartered Accountants of India, the assets acquired

under finance leases on or after April 1, 2001 are capitalised and a loan liability is recognised for an equivalent amount. Consequently

depreciation is provided on such assets. Lease rentals paid are allocated to the liability and the interest is charged to statement of profit

and loss.

Operating leases

The Company has taken certain premises, office equipments and employee cars under non-cancellable operating leases. The rental

expense in respect of operating leases was 54.02 Mn (previous year 134.79 Mn) and the future rentals payable are as follows:

(Z Million)

2015-16 2014-15

Minimum lease payments

- Payable not later than 1 year 62.12 73.43

- Payable after 1 year but not later than 5 years 389.52 474.16

Total 451.64 547.59

1(4) Basic and diluted earnings per share (EPS) at face value of Z 1

Before extraordinary items

2015-16 2014-15

Profit after tax (Z Million) 9,221.77 7,606.18


Basic EPS (Z) 56.26 47.17

2015-16 2014-15

161,250,000 Weighted average number of shares outstanding 163,914,663

Add : weighted average number of potential equity shares on account of employee options 392,052 7,270,100


Diluted EPS (Z) 56.13 45.14

2015-16

9,221.77

163,914,663

56.26

2014-15

7,685.26

161,250,000

47.66



After extraordinary items

Profit after tax (Z Million)

Weighted average number of shares outstanding

Basic EPS (?)

2015-16 2014-15


163,914,663

161,250,000

Add : weighted average number of potential equity shares on account of employee options

392,052

7,270,100


164,306,715

168,520,100

Diluted EPS (?)

56.13

45.60

Earnings per share for the year 2014-15 include results of discontinued operations up to date of its transfer.

EPS for the previous year is after considering sub-division of equity shares from face value of ? 5 each to face value of ? l each per equity

share (refer note B(1)).

1(5) Related party disclosure:

(i) Key Management Personnel:

Name

Mr. V. K. Magapu

Status

Managing Director*

Mr. Sanjay Jalona Chief Executive Officer & Managing Director**

Mr. Chandrashekara Kakal Chief Operating Officer & Executive Director***

Mr. K. R. L. Narasimham Executive Director#

Mr. Vivek Chopra Chief Executive (Industrials Cluster) & Executive Director$

Dr. Mukesh Aghi Chief Executive (Services Cluster) & Executive Director^

Mr. Sunil Pande Executive Director^^

Ceased to be Director w.e.f. the close of working hours of September 25, 2015

** Appointed as Chief Executive Officer & Managing Director w.e.f. August 10, 2015

*** Ceased to be Director w.e.f. the close of working hours of August 26, 2015

Ceased to be Director w.e.f. the close of working hours of April 7, 2015

$ Ceased to be Director w.e.f. the close of working hours of December 31, 2014 A Ceased to be Director w.e.f. the close of working hours of February 28, 2015 AA Ceased to be Director w.e.f. the close of working hours of August 25, 2015



(ii) List of related parties with whom there were transactions during the year:

Larsen & Toubro Limited Holding Company

L&T Hydrocarbon Engineering Limited Fellow Subsidiary

Larsen & Toubro (East Asia) SDN.BHD Fellow Subsidiary

L&T Electricals and Automation Saudi Arabia Company LLC Fellow Subsidiary

L&T Finance Limited Fellow Subsidiary

L&T General Insurance Company Limited Fellow Subsidiary

L&T Infrastructure Development Projects Limited Fellow Subsidiary

L&T Power Development Limited Fellow Subsidiary

Larsen & Toubro Kuwait Construction General Contracting Company, With Limited Liability Fellow Subsidiary

L&T Infrastructure Finance Company Limited Fellow Subsidiary

L&T Metro Rail (Hyderabad) Limited Fellow Subsidiary

L&T Technology Services Limited Fellow Subsidiary

L&T Valves Limited Fellow Subsidiary

L&T Investment Management Limited Fellow Subsidiary

L&T Construction Equipment Limited Fellow Subsidiary

Larsen & Toubro LLC Fellow Subsidiary

Nabha Power Limited Fellow Subsidiary

L&T Electrical & Automation FZE Fellow Subsidiary

Spectrum Infotech Private Limited Fellow Subsidiary

Family Credit Limited Fellow Subsidiary

PT. Tamco Indonesia Fellow Subsidiary

L&T Special Steels and Heavy Forgings Private Limited Fellow Subsidiary

Larsen & Toubro ATCO Saudi LLC Fellow Subsidiary

L&T Thales Technology Services Private Limited Fellow Subsidiary

L&T Capital Markets Limited Fellow Subsidiary

L&T Housing Finance Limited Fellow Subsidiary

Larsen & Toubro Electromech LLC Fellow Subsidiary

Tamco Electrical Industries Australia PTY Limited Fellow Subsidiary

L&T Technology Services LLC Fellow Subsidiary



A summary of transactions with related parties is given below:

Sale of services / products

- L&T Metro Rail (Hyderabad) Limited


- L&T Hydrocarbon Engineering Limited

- L&T Thales Technology Services Private Limited

1,101.01

(352.00)

-

-

-

-

423.59

(324.91)

63.60

50.50

78.80

95.70

Sale of assets 108.62 7.70

H H -L&T Technology Services Limited _ 7.70

Purchase of services 275.43 694.17

(1,034.96) (788.45)

- L&T Technology Services Limited - 694.17

Overheads charged by 635.01 38.36

(125.82) (44.84)

- Larsen & Toubro (East Asia) SDN.BHD - 24.03

- L & T Electrical & Automation FZE 7.19

- Larsen & Toubro Kuwait Construction General Contracting Company, With Limited 6.23

Liability

Overheads charged to 82.49 441.42

(65.57) (715.18)

- L&T Technology Services Limited 440.12

Commission charged - 5.26

H (18.40)

Lease rent - 0.07

H (0.52)

Commission - -

H (0.62)

Trademark fees 104.89

H H Trade receivable 450.38 53.40

(0.01) (88.80)

Trade payable

(174.23)_ (0.89)

Interim dividend 5,264.81 -

(4,805.25)_ ( )



1(6) Segmental reporting

The Group has 2 business segments. Services Cluster includes Banking, Financial services, Insurance, Media & Entertainment, Travel &

Logistics and Healthcare. Industrials Cluster includes Hi Tech and Consumer Electronics, Consumer, Retail & Pharma, Energy & Process,

Automobile & Aerospace, Plant Equipment & Industrial Machinery, Utilities and E&C.

T(6)(i)Revenues represented along industry classes comprise the primary basis of segmental information set out in these financial statements.

The revenue and operating profit by segment is as under:

(Z Million)

Revenue

Services Cluster

31,533.04

Industrial Cluster

26,937.56

Telecom (PES

Discontinued

Business)

Total

58,470.60 -

(26,289.89) (23,391.05) (99.42) (49,780.36)

14,336.12 Segmental operating profit 7,439.75 6,896.37 -

(5,456.21) (6,123.58) (9.72) (11,589.51)

Unallocable expenses (net) 3,979.97

(1,544.93)

2,959.61 Other income

(915.00)

Operating profit 13,315.76

(10,959.58)

Finance cost 103.57

(104.19)

Depreciation 736.67

(741.55)

Amortization of intangible assets 1,002.85

(837.85)

Profit before tax 11,472.67

(9,275.98)

1(6) (ii) Segmental reporting of revenues on the basis of the geographical location of the customers is as under:

(Z Million)

Geography Revenue from Continuing Business Revenue from Discontinued

Business Total Revenue

2015-16 2014-15 2015-16 2014-15 2015-16 2014-15

North America 40,370.47 34,097.77 40,370.47 34,097.77

Europe 10,124.59 8,862.74 99.42 10,124.59 8,962.16

India 3,400.19 2,075.90 3,400.19 2,075.90

APAC 1,190.47 1,199.12 1,190.47 1,199.12

ROW 3,384.88 3,445.41 3,384.88 3,445.41

Total 58,470.60 49,680.94 99.42 58,470.60 49,780.36



Fixed assets used and liabilities contracted for performing the Company's business have not been identified to any of the above reported

segments as the fixed assets and services are used interchangeably among segments.

T(7) On October 16, 2014, the Company acquired entire share capital of Information Systems Resource Centre Private Limited ('ISRC'),

thereby making it a wholly owned subsidiary. ISRC is engaged in software services with respect to application development, information

technology support and maintenance services to OTIS Elevator Company Inc. (OTIS) and certain other group companies of OTIS, which

are part of United Technologies Corporation (UTC) group. The Company believes that acquisition will strengthen its relationship with

UTC group. The acquisition was executed through a share purchase agreement for a consideration of 806.96 Mn.

The Board of Directors of the Company and ISRC have approved the scheme of amalgamation of ISRC with the Company on October

17, 2014 and December 4, 2014, respectively, with October 17, 2014 as the appointed date. Accordingly, a petition for sanctioning the

scheme of amalgamation has been filed with the Hon'ble High Court of Judicature at Bombay.

The Scheme has been sanctioned by the Hon'ble High Court of Judicature at Bombay vide its order dated September 4, 2015. The

Scheme was filed with the Registrar of the Companies on September 21, 2015 and came into effect on that day with appointed date

being October 17, 2014. Pursuant thereto, the entire business and all the assets and liabilities, duties and obligations of ISRC have been

transferred to and vested in the Company with effect from October 17, 2014. In accordance with the Scheme, the investment held in

the subsidiary has been cancelled and ISRC being a wholly owned subsidiary of the Company, no equity shares were exchanged to effect

the amalgamation in respect thereof.

The excess of purchase consideration paid over the net assets acquired is accounted as goodwill amounting to 614.56 Mn. (Also refer

note A (3) (c)).

T(8) (i)As part of business restructuring undertaken within Larsen &Toubro Group in 2013-14, Product Engineering Services (PES) Business Unit

was transferred to L&T Technology Services Limited (LTTS) effective January 1, 2014 by way of slump sale for total purchase consideration

of 4,895.27 Mn based on fair valuation. GDA Technologies Inc., USA (GDA Inc.), a wholly owned subsidiary of the Company was a part

of PES business. The performance of GDA Inc. was affected due to the recession and subsequent to the transfer of PES business, it was

therefore decided to wind up this subsidiary. The Indian subsidiary of GDA Inc. called GDA Technologies Ltd., India was taken over by

the Company in 2013-14 based on fair valuation carried out by external chartered accountants. Consequently GDA Inc. was wound up

in USA with effect from March 28, 2014.

The Company's subsidiary, Larsen & Toubro Infotech GmbH, also had PES business. PES business transfer in Germany was dependent

upon LTTS registering its branch in Germany. The German branch of LTTS became operational in the month of May 2014. Since valuation

of PES business in Germany is required to be carried out as per German laws, Business Transfer Agreement was signed between Larsen

& Toubro Infotech GmbH and LTTS, for transfer of PES business in Germany effective September 1, 2014.

The PES business was transferred by way of slump sale for total purchase consideration of 129.20 Mn based on fair valuation carried

out by external valuer based in Germany. The purchase consideration was determined based on the Discounted Cash Flow (DCF) method

of valuation of business.

Larsen & Toubro Infotech GmbH has transferred the following assets and liabilities to L&T Technology Services Limited:

(Z Million)

Current assets

Trade receivables 45.79

Short term loans and advances 0.17

45.96

Current liabilities and provisions

Other current liabilities 10.71

Net current assets 35.25

Net Assets transferred 35.25

Total revenues

Total expenses

Profit before taxes

Income taxes

Profit after tax

99.42

(89.70)

9.72

(1.69)

8.03



The results of discontinued business are as under:

(Z Million)

1(8) (ii) Extra -ordinary item

The above has given rise to extraordinary gain of 93.95 Mn being recognised in the financial statements.

1(9) The Board of Directors of the Company and GDA Technologies Limited have approved the scheme of amalgamation of GDA Technologies

Limited with the Company on October 17, 2014, with April 1, 2016 as the appointed date. Accordingly, a petition for sanctioning the

scheme of amalgamation has been filed with the Hon'ble High Court of Judicature at Bombay and the Hon'ble High Court of Judicature

at Madras.

The Scheme has been sanctioned by the Hon'ble High Court of Judicature at Bombay vide its order dated April 01, 2016. The approval

of the Scheme by the Hon'ble High Court of Judicature at Madras is awaited.

1(10) The Company is not required to transfer any amount to Investor Education and Protection Fund.

1(11) The Company in its board meeting held on June 16, 2015 has taken approval for the Offer for Sale (`the Offer') by Larsen & Toubro

Limited in the Initial Public Offering of the Company. Pursuant to the same, the Company had filed its Draft Red Herring Prospectus

('DRHP') on September 28, 2015. Owing to change in the Offer structure and other considerations, the said DRHP was withdrawn on

April 11, 2016 and pursuant to the approval of the !PO Committee, the Company filed a revised DRHP on April 12, 2016.

1(12) Previous year's figures have been regrouped / reclassified wherever necessary.

As per our report attached SHARP & TAN NAN Chartered Accountants Firm's Registration No. 109982W

by the hand of

FIRDOSH D. BUCHIA

Sanjay Jalona

R. Shankar Raman Ashok Kumar Sonthalia Subramanya Bhatt Partner



& Managing Director

Mumbai

Mumbai

April 26, 2016

April 26, 2016

board's report - virk

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