Director's Report
Home >> Markets >> Corporate Information >> Director's Report
HCL Technologies LtdIndustry : Computers - Software - Large
BSE Code:532281
ISIN Demat:INE860A01027
Book Value(Rs):197.96
NSE Symbol:HCLTECH
Div & Yield %:1.2
Market Cap (Rs Cr.):139721.05
P/E(TTM):18.42
EPS(TTM):54.48
Face Value(Rs):2
  Change Company 

Dear Shareholders,

Your Directors have immense pleasure in presenting the Twenty Fourth Annual Report together with the audited financial statements for the year ended March 31, 2016 (nine months period from July 1, 2015 to March 31, 2016 hereinafter referred as 'Financial Year').

1. FINANCIAL RESULTS

Key highlights of the financial results of your Company for the year ended March 31, 2016 are as under:

Particulars Consolidated Standalone
Year ended 31st March 2016 (Nine months) 30th June, 2015 (Twelve months) Year ended 31st March 2016 (Nine months) 30th June, 2015 (Twelve months)
Total Income 31,676.24 37,840.68 14,402.11 18,352.94
Total Expenditure 24,707.10 28,723.62 8,634.50 10,654.40
Profit before tax 6,969.14 9,117.06 5,767.61 7,698.54
Provision for tax (1,363.89) (1,815.11) (1,033.93) (1,352.59)
Share of profit of associates 56.20 39.90 - -
Profit for the year 5,661.45 7,341.85 4,733.68 6,345.95
Profit attributable to
Owners of the Company 5,643.04 7,317.07 - -
Share of profit of minority interest 18.41 24.78 - -

2. RESULTS OF OPERATIONS AND THE STATE OF COMPANY'S AFFAIRS

On a standalone basis, the Company achieved revenue of Rs 14,402.11 crores in the nine months' period from July 1, 2015 to March 31, 2016 and a profit of Rs 4,733.68 crores in the said financial year.

On a consolidated basis, the Company achieved revenue of Rs 31,676.24 crores in the nine months' period from July 1, 2015 to March 31, 2016 and a profit of Rs 5,661.45 crores in the said financial year.

The state of affairs of the Company is presented as part of Management Discussion and Analysis Report forming part of this report.

In accordance with the Companies Act, 2013 ("the Act") and Accounting Standard (AS) - 21 on Consolidated Financial Statements read with AS - 23 on Accounting for Investments in Associates and AS - 27 on Financial Reporting of Interests in Joint Ventures, the audited consolidated financial statements is provided in the Annual Report.

The current financial year of the Company is for a nine months period from July 1, 2015 to March 31, 2016. The figures for the current financial year are therefore not comparable with those of the previous year.

3. DIVIDEND

During the financial year ended March 31, 2016, your Directors had declared and paid three interim dividends as per the details given below:

Interim dividend paid during the period from July 1, 2015 to March 31, 2016 Rate of dividend per share (face value of Rs 2 each) Amount of dividend paid Dividend Distribution tax paid by the Company (Rs in crores) Total Outflow
1st Interim Dividend Rs 5 702.99 139.17 842.16
2nd Interim Dividend Rs 5 703.16 139.18 842.34
3rd Interim Dividend Rs 6 845.59 172.14 1017.73
Total 2,251.74 450.49 2,702.23

The Board of Directors in its meeting held on April 27-28, 2016, has declared an interim dividend of Rs 6 per equity share of face value of Rs 2 each for the year 2016-17. The Directors did not recommend final dividend for the year ended March 31, 2016.

4. TRANSFER TO RESERVES

No amount was transferred to the General Reserve Account for the Financial Year.

5. CHANGES IN CAPITAL STRUCTURE

Shares allotted under Employees Stock Option Plans

During the year, the Company allotted 44,02,896 equity shares of

Rs 2 each fully paid-up under its Employees Stock Option Plans.

Issued and Paid-up share capital as on March 31, 2016

As on March 31, 2016, the issued, subscribed and paid-up share capital of the Company was Rs 2,820,762,628 divided into 1,410,381,314 equity shares of face value of Rs 2 each.

6. DEBENTURES

Your Company has not issued any fresh debentures during the financial year under review.

7. MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report, in terms of Regulation 34 (3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is attached and forms a part of this Report.

8. SUBSIDIARIES/ACQUISITIONS

As on March 31, 2016, the Company has 86 subsidiaries and 9 associate companies within the meaning of Section 2(6) of the Companies Act, 2013 ("Act"). There has been no material change in the nature of the business of the subsidiaries.

As per the provisions of Section 129(3) of the Act, a statement containing salient features of the financial statements of the Company's subsidiaries (which includes associate companies and joint ventures) in Form AOC-1 is attached to the financial statements of the Company.

As per the provisions of Section 136 of the Act, the standalone financial statements of the Company, consolidated financial statements along with relevant documents and separate audited accounts in respect of subsidiaries, are available on the website of the Company. The Company would provide the annual accounts of the subsidiaries and the related detailed information to the shareholders of the Company on specific request made to it in this regard by the shareholders.

During the year, the Company had incorporated the following step down subsidiaries / associate companies (through Joint Venture): -

Name of Subsidiary Companies Country of Incorporation
1 HCL Technologies Czech Republic S.R.O. Czech Republic
2 HCL Muscat Technologies LLC Oman
3 HCL Joint Venture Holding Inc. USA
4 CeleritiFinTech Australia Pty. Limited Australia
5 CeleritiFinTech USA Inc. USA
6 CeleritiFintech Italy S.R.L. Italy
7 CeleritiFinTech Germany GmbH Germany
8 CeleritiFinTech Limited United Kingdom
Name of Associate Companies
9 CeleritiFinTech Services Limited United Kingdom
10 CeleritiFinTech Services USA Inc.* USA
11 CeleritiFinTech Services Australia Pty. Limited* Australia
12 CeleritiFinTech Services Italy S.R.L.* Italy
13 CeleritiFinTech Services Germany, GmbH* Germany
14 CeleritiFintech Services India Pvt. Ltd.* India

*CeleritiFintech Services Limited, UK is the holding Company of this Company.

In addition to the above, the Company acquired 100% stake in HCL Training and Staffing Services Private Limited (HCLTSS), a company incorporated in India, engaged in the business of recruitment of engineers and rendering of training in the field of IT and ITES.

HCL Technologies UK Limited, a step down subsidiary of the Company in UK acquired 100% stake in Point to Point Limited and Point to Point Products Limited (jointly referred to as P2P), the companies incorporated in UK, being a niche provider of complex workplace engineering services in UK.

HCL Global Processing Services Limited, a subsidiary of the Company in India acquired 100% stake in Concept2Silicon Systems Private Limited ("C2SiS"), a Company incorporated under the Companies Act, 1956, engaged in providing complete solutions for complex system on Chip and System designs with best in class engineering capabilities and a cost-efficient business model.

HCL America Inc., a step down subsidiary of the Company in USA, acquired the Powerteam LLC, a Delaware limited liability company (popularly known as "PowerObjects"), a leading North American solutions provider and a partner of Microsoft engaged in the business of developing, maintaining, licensing, consulting, servicing etc. related to customer relationship management ("CRM") using the Microsoft Dynamics suite of products.

During the year, the Company has acquired the IT division of Volvo IT AB ('Volvo IT'), a subsidiary of AB Volvo, the holding company of the Volvo Group, which provides IT services to the Volvo group as well as non- Volvo group customers.

The Company also acquired certain assets of privately held Trygstad Technical Services Inc. ("Trygstad"), a US based provider of IT consulting services & solutions to marquee customers, in an all cash deal. Trygstad Technical Services Inc. is a niche company with deep expertise in the areas of core engineering (including operating systems), Internet Of Things (IoT), Embedded Systems and Intelligent Systems.

9. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board of Directors consists of ten members, of which,one is the Promoter Director who is designated as the Chairman and Chief Strategy Officer of the Company. The other 9 Directors are Non-Executive Directors, of which 7 are Independent Non-Executive Directors. The Board also comprises of two women Directors.

At the Annual General Meeting of the Company held on December 22, 2015, Mr. Thomas Sieber (DIN - 07311191) was appointed as an Independent Director of the Company in terms of section 149 of Companies Act, 2013, to hold office for a period of five years.

The Independent Directors have furnished the certificate of independence stating that they meet the criteria of independence as mentioned under Section 149 (6) of the Act and Regulation 16 (1) (b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

As per the provisions of Section 152 (6) of the Act, Ms. Roshni Nadar Malhotra (DIN 02346621) shall retire by rotation at the ensuing Annual General Meeting and being eligible, has offered herself for reappointment as the Director of the Company.

10. NUMBER OF MEETINGS OF THE BOARD

During the year, four meetings of the Board were held. The details of the meetings are provided in the Corporate Governance Report.

11. FAMILIARIZATION PROGRAMME

The details of familiarization programme have been provided under the Corporate Governance Report.

12. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Oblgation and Disclosure Requirements) Regulations, 2015, a formal Annual Performance evaluation is to be made by the Board of its own performance and that of the Committees and individual Directors. Also, Schedule IV of the said Act requires performance evaluation of Independent Directors by the Board, excluding the Director being evaluated.

In view of the above, the annual performance evaluation was conducted by the Board on the basis of framework and criteria approved by the Nomination and Remuneration Committee of the Company. The process and criteria of evaluation is explained in the Corporate Governance Report, which forms part of this report.

13. AUDITORS

M/s. S.R. Batliboi & Co. LLP, Chartered Accountants, were appointed as the Statutory Auditors of your Company in the Annual General Meeting held on December 4, 2014 for a term of five years until the conclusion of the Twenty Seventh AGM of the Company to be held in the year 2019. As per the provisions of Section 139 of the Act, the appointment of the Statutory Auditors is required to be ratified by Members at every Annual General Meeting. Accordingly, the appointment of M/s. S.R. Batliboi & Co. LLP, Chartered Accountants, as Statutory Auditors of the Company, shall be placed for ratification by the Members in the ensuing Annual General Meeting. In this regard, the Company has received a certificate from the Auditors to the effect that their re-appointment, if made, would be within the limits prescribed under Section 141 of the Companies Act, 2013 and that they are not disqualified for such reappointment within the meaning of the said section.

14. AUDITORS' REPORT

There are no qualifications, reservations or adverse remarks made by M/s. S.R. Batliboi & Co. LLP, Statutory Auditors in their report for the financial year ended March 31, 2016. The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.

15. SECRETARIAL AUDIT REPORT

In terms of Section 204 of the Act, M/s. Chandrasekaran Associates, Practicing Company Secretaries were appointed as the Secretarial Auditor of the Company. The report of the Secretarial Auditor is enclosed as Annexure 1 to this Report. The report is self-explanatory and does not call for any further comments. There are no qualifications, reservations or adverse remarks made by the Secretarial Auditor in their report for the financial year ended March 31, 2016.

16. EXTRACT OF ANNUAL RETURN

Pursuant to Section 134(3)(a) and Section 92(3) of the Act, the extract of the Annual Return in Form MGT-9 is enclosed as Annexure 2 to this Report.

17. DIRECTORS' APPOINTMENT AND REMUNERATION

In accordance with the provisions of Companies Act, 2013, the Nomination and Remuneration Committee shall formulate the criteria for determining the qualifications, positive attributes and independence of Directors in terms of its charter.

In evaluating the suitability of individual Board members, the Committee takes into account factors, such as Educational and professional background, General understanding of the Company’s business dynamics, Standing in the profession, Personal and professional ethics, integrity and values, Willingness to devote sufficient time and energy in carrying out their duties and responsibilities effectively.

The Committee also assesses the independence of Directors at the time of appointment / re-appointment as per the criteria prescribed under the provisions of the Companies Act, 2013 and rules made thereunder and the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015.

The Remuneration Policy for Directors, Key Managerial Personnel and other employees are provided in the Corporate Governance Report forming part of this report.

18. AUDIT COMMITTEE

The Audit Committee comprises of four Independent Directors namely, Mr. Amal Ganguli, Ms. Robin Ann Abrams, Mr. Subramanian Madhavan and Mr. Keki Mistry. During the year, all the recommendations made by the Audit Committee were accepted by the Board.

19. RISK MANAGEMENT POLICY

The Board of the Company has formed a Risk Management

Committee to inter-alia assist the Board in overseeing the responsibilities with regard to the identification, evaluation and mitigation of operational, strategic and external environmental risks. In addition, the Audit Committee is also empowered to oversee the areas of risks and controls.

The Company has developed and implemented a Risk Management Policy that ensures the appropriate management of risks in line with its internal systems and culture.

20. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company's internal financial control systems are commensurate with its size and the nature of its operations. The controls are adequate for ensuring the orderly and efficient conduct of the business and these controls are working effectively. These controls have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, adherence to the Company's policies, safe-guarding of assets from unauthorized use and prevention and detection of frauds and errors.

21. SIGNIFICANT AND MATERIAL ORDERS

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

22. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

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

23. TRANSACTIONS WITH RELATED PARTIES

None of the transactions with related parties falls under the scope of Section 188(1) of the Act. Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure 3 in Form AOC-2 and the same forms part of this Report. The Company also has in place a ‘Related Party Policy’, which is available on the website of the Company.

24. CORPORATE SOCIAL RESPONSIBILITY

The Corporate Social Responsibility (CSR) committee comprises of three members, namely Mr. Shiv Nadar, Ms. Roshni Nadar Malhotra and Mr. Subramanian Madhavan. The Committee is inter-alia responsible for formulating and monitoring the CSR Policy of the Company. A brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure 4 of this Report in the form as prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. The Policy is available on the website of the Company.

25. TRANSFER OF UNPAID AND UNCLAIMED AMOUNTS TO IEPF

Pursuant to the provisions of Section 124(5) of the Act, the dividend amounts which have remained unpaid or unclaimed for a period of seven years from the date of declaration have been transferred by the Company to the Investor Education and Protection Fund ("IEPF") established by the Central Government pursuant to Section 125 of the Act. The details of unpaid/unclaimed dividend that will be transferred to IEPF in subsequent years are given in the Corporate Governance section of the Annual Report.

26. DEPOSITS

Your Company has not accepted any deposits from public.

27. CORPORATE GOVERNANCE

The Corporate Governance Report, in terms of Regulation 34 (3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, along with the Statutory Auditors certificate is attached and forms part of this Report.

28. BUSINESS RESPONSIBILITY REPORT

The Securities and Exchange Board of India ("SEBI") vide the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, has mandated inclusion of Business Responsibility Report ("BRR") as part of the Annual Report for top 500 listed companies. However, pursuant to these regulations, if a listed Company publishes the Sustainability Report based on internationally accepted reporting framework along with a mapping of the BRR as stated in the said regulations, it would be treated as sufficient compliance of these regulations.

For the financial year 2015-16, as the Company has prepared its sustainability report based on the internationally accepted reporting framework and the principles stated under the above SEBI regulations have been mapped with the Sustainability Report, no separate BRR has been prepared by the Company. The mapping and the Sustainability Report are available on our website at http://www.hcltech.com/socially-responsible-business.

29. INSIDER TRADING REGULATIONS

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations, 2015, the 'Insider Trading Code' to regulate, monitor and report trading by insiders and the 'Code of Practices and Procedures for fair disclosure of Unpublished Price Sensitive Information' are in force.

30. AWARDS AND RECOGNITIONS

Your Company relentlessly pursues excellence and is delighted to receive phenomenal share of recognitions and awards this year, not only from the media, but also from analysts, governing bodies, academic institutions, partners and even customers. Some of the key accolades received during the year include:

• Won the coveted Indo-German Chamber of Commerce Award for "Outstanding Contribution towards the Indo-German Economic Relations, 2015". The award was given for creating a strong local presence in Germany while strengthening employment creation & competitiveness in the region.

• ITSMA's (IT Services Marketing Association) Diamond award for "Delivering an Omnichannel Customer Experience" for corporate positioning - 'Relationship Beyond the Contract', which has been recognized as industry's best-in-class, driving business with thought leadership and another Diamond Award for Marketing Excellence.

• Recognized at the Asian Customer Engagement Forum (ACEF) Awards, for "Creativity in Digital Marketing" exhibited in its campaign, showcasing the impact of viral videos for building employer brand affinity amongst existing and prospective employees.

• Recognition as the fastest growing brand for the second consecutive year by the Interbrand, world's leading brand consultancy.

• Recognized as one of the most admired corporate brands by The Economic Times (ET), in its study on the Best Corporate Brands 2015.

• Recognition as a Top Employer in the UK for ten consecutive years for its exceptional employee offerings and outstanding HR practices.

• Continuing its focus on best-in-class people practices, HCL has been awarded the Special TM Commendation Prize for "Practice of Ideapreneurship" at Asian Human Capital Awards 2015.

• 2015 Governor's NCWorks Award of Distinction as an "Outstanding Employer" in the state of North Carolina.

• Selected as the winner of the CA Technologies Partner of the Year Awards 2015 in the category of innovation and sales teaming for its ability to drive global innovation and sales teaming in both infrastructure management and service management.

• Positioned as a Leader in the IDC MarketScape Worldwide Life Science Manufacturing and Supply Chain ITO Vendor Assessment 2015.

• Everest Group PEAK Matrix 'Service Provider of the Year Award 2016' in two categories - 'Overall IT Services' and 'Banking, Financial Services and Insurance (BFSI) IT'. In both these categories, the Company has been recognized as 'Star Performer of the Year'.

• Positioned among Leaders in IDC MarketScape for Worldwide Application Modernization Services for Oracle Upgrades,2016.

• Positioned in the "Winner's Circle" for its software product engineering services capabilities by the leading analyst firm HfS in its report "HfS Blueprint Report: Software Product Engineering Services Outsourcing 2015".

• Recognized as a Leader in IDC MarketScape for Worldwide Application Modernization Services for Digital Transformation 2015 Vendor Assessment, Dec 2015.

• Recognized as an Outstanding Contributor to the VLSI/ Embedded Design Industry in the Corporate Category, by Mentor Graphics Corporation and Silicon India, at the Leadership Awards 2015.

• Positioned in the leadership zone in Zinnov's Media & Entertainment Global Service Providers Rating for Gaming,

Entertainment, Marketing & Advertising, Publishing and Information Services, 2016.

• Rated as a Leader in The Forrester Wave™: Global Workplace Services, North American Workplace Services, EMEA Workplace Services, Q4 2015 by Wolfgang Benkel and William Martorelli December 17, 2015.

• Positioned as a Leader in IDC MarketScape for Worldwide Microsoft Enterprise Applications Implementation Services, 2015.

31. SUSTAINABILITY

Your Company believes in a better tomorrow and based on this strong belief has embarked on a Sustainability 2020 programme. The Company's continuous focus on improving all aspects of sustainability demonstrates its commitment to a sustainable tomorrow without compromising on the well-being of its employees today. To do this, the Company partners with multiple stakeholders to form an inclusive working group to create policies, processes and other organizational measures. Today, the Sustainability Department runs a multi-layered corporate program to drive the sustainability vision.

The ongoing success of the programme depends on a consistent and sustainable vision, ease and flexibility of implementation and most importantly Employee Engagement. At HCL, sustainability actions are a part of everyday operations. It believes that responsible investments in sustainability will generate long term value for all the stakeholders by improving competitiveness and reducing risk.

Sustainability can be created when we are able to integrate broader societal concerns into business strategy and performance as part of the Company's business model. This common sense of ownership can be realized by incorporating the interests of all those with whom the Company has mutually dependent relationships.

The initiatives taken by the Company on sustainability are given in detail in the sustainability report for the year 2015-16 which is hosted on the website of the Company.

32. ORGANIZATION EFFECTIVENESS

The Company has further consolidated its distinctive practices during the financial year under review around the theme of design U2.0. Design U2.0 is a journey of self-discovering and development by which individuals in an organization take responsibility for optimizing their future readiness and will deliver on the four capability areas of Listen, Collaborate, Ideate and Create for the individual and organization both. Your Company is anchoring its employee experience proposition around Design U2.0.

Career & Talent Management

The Social HR framework put in place by the Company saw further recognition for Social Career Management by Brandon Hall (best advance in social talent management technology and another for best advance in leadership development) amongst many similar recognitions.

The social career and talent management platform allows employees to recast their roles as CEO of their own careers. Employees access the Company's career architecture, understand what it takes to be selected for each opportunity and go through a job based integrated curriculum to advance their career aspirations on a social career management platform. In this social career management platform, employees can refer internal opportunities to other employees and can anonymously vote their career advice to a fellow employee.

Engagement & Culture

The Company continues to be the place where employees can listen, ideate, collaborate and create. For the 10th year in a row, the Company was awarded the best employer in UK by the "Top Employers Institute" for its employee engagement and Ideapreneurship culture. The Company has also won the Asian Human Capital award for the practice of Ideapreneurship by the Human Capital Leadership Institute in Singapore.

The culture of Ideapreneurship is how the Company provides its employees or ideapreneurs with the license to ideate, the tools to ideate and the recognition for ideating. This helps us as a firm to deliver a relationship beyond the contract with our customers.

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

Disclosures of particulars as required under Section 134(3)(m) of the Act read with the Companies (Accounts) Rules, 2014 to the extent applicable to your Company, are set out in Annexure 5 to this Report.

34. DIRECTORS' RESPONSIBILITY STATEMENT

A statement of responsibility of the Directors relating to compliance with the financial accounting and reporting requirements in respect of the financial statements, as specified under clause (c) of subsection 3 of Section 134 of the Act, is annexed as Annexure 6 to this Report.

35. STOCK OPTIONS PLANS

1999 Stock Option Plan / 2000 Stock Option Plan / 2004 Stock Option Plan

The details of these plans have been annexed as Annexure 7 to this Report.

36. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

Except, as disclosed elsewhere in the Report, there have been no material changes and commitments, which can affect the financial position of the Company between the end of the financial year and the date of this Report.

37. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197(12) of the Act read with Rule 5(1) of The Companies (Appointment and

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

a. The ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year:

Sl.No. Name of Director Ratio to median remuneration of employees
Executive Director
1. Mr. Shiv Nadar* 214.47
Non-Executive Directors
2. Mr. Amal Ganguli 10.11
3. Mr. Keki Mistry 8.24
4. Mr. Ramanathan Srinivasan 14.16
5. Ms. Robin Ann Abrams 14.57
6. Ms. Roshni Nadar Malhotra 7.59
7. Mr. Subramanian Madhavan 9.43
8. Mr. Sudhindar Krishan Khanna 7.69
9. Dr. Sosale Shankara Sastry 11.85
10. Mr. Thomas Sieber** -

The remuneration of Non-executive Directors also includes sitting fees paid during the year *The ratio has been calculated after taking into account the remuneration drawn from the Company as well the subsidiaries.

**He was appointed as Director during the year. Hence the said information is incomparable and not provided.

b. The percentage increase in remuneration of each Director, Chief Executive Officer, Chief Financial Officer, Company Secretary in the financial year:

The current financial year of the Company is for a nine months period from July 1, 2015 to March 31, 2016. The figures for the current financial year are therefore not comparable with those of the previous year.

c. The percentage increase in the median remuneration of employees in the financial year: 6.8%

d. The number of permanent employees on the rolls of Company: There were 74,887 permanent employees on the rolls of the Company. In addition the Company has 28,504 number of employees on the rolls of its subsidiaries.

e. The explanation on the relationship between average increase in remuneration and Company performance:

On an average, employees received an annual increase of 8.09% in India. The individual increments varied from 2.4% to 21.92%, based on individual performance.

Employees outside India received average wage increase of 2.5%. The increase in remuneration of employees in India and outside India is in line with the market trends in the respective countries. Increase in remuneration of employees reflects the individual's and Company's performance. The Annual

Performance Bonus pay out is also linked to organization performance, apart from an individual's performance.

f. Comparison of the remuneration of the Key Managerial Personnel against the performance of the Company:

(Rs in crores)

Particulars On the basis of
Standalone Consolidated
Aggregate remuneration of Key 51.26 55.98
Managerial Personnel (KMP) in FY16
Revenue (FY16) 14,402.11 31,676.24
Remuneration of KMP as percentage of Revenue 0.36 0.18
Profit before Tax (FY16) 5,767.61 6,969.14
Remuneration of KMP as percentage of Profit before Tax 0.89 0.80

g. Variations in the market capitalisation of the Company, price earnings ratio as at the closing date of the current financial year and previous financial year:

Particulars 31st March 2016 30th June 2015 % change
Market Capitalisation (Rs crore) 114,819 129,312 -11.2%
Price Earnings Ratio 30.54* 35.52 -14.0%

* EPS for FY15-16, has been annualized by multiplying EPS of 9 months ending March, 2016 with 4/3.

h. Percentage increase over decrease in the market quotations of the shares of the Company in comparison to the rate at which the Company came out with the last public offer:

Particulars 31st March 2016 24th December 1999 (IPO) 24th December 1999 (IPO)* % change*
Market Price (NSE) 814.10 580 72.5 1022.9
Market Price (BSE) 814.15 580 72.5 1023.0

* Adjusted for Stock Split (face value of Rs 4 per share sub-divided into 2 shares of face value of Rs 2 each in the year 2000) and adjusted for Bonus issues in the year 2007 (1:1) and 2015 (1:1).

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

The average annual increase was 6%. There is no increase in the managerial remuneration during the year.

j. Comparison of each remuneration of the Key Managerial Personnel against the performance of the Company:

i) On the basis of Standalone accounts

(Rs in crores)

Mr. Shiv Nadar, Mr. Anant Gupta, Mr. Anil Chanana, Mr.Manish Anand,
Chairman & Chief Strategy Officer Chief Executive Officer Chief Financial Officer Company Secretary
Remuneration in FY16 9.07 38.19 3.46 0.54
Revenue 14,402.11
Remuneration as % of Revenue 0.063 0.265 0.024 0.004
Profit before Tax 5,767.61
Remuneration as % of Profit before Tax 0.157 0.662 0.060 0.009

ii) On the basis of Consolidated accounts

(Rs in crores)

Mr. Shiv Nadar, Mr. Anant Gupta, Mr. Anil Chanana, Mr.Manish Anand,
Chairman & Chief Strategy Officer Chief Executive Officer Chief Financial Officer Company Secretary
Remuneration in FY16 12.60 38.19 4.66 0.54
Revenue

31,676.24

Remuneration as % of Revenue 0.040 0.121 0.015 0.002
Profit before Tax

6,969.14

Remuneration as % of Profit before Tax 0.181 0.548 0.067 0.008

k. The key parameters for any variable component of remuneration availed by the Directors:

The shareholders of the Company in the Annual General Meeting held on December 4, 2014 had granted their approval for payment of commission not exceeding one percent per annum of the net profits of the Company calculated in accordance with the provisions of the Act, to all the Non-executive Directors of the Company for a period of 5 years beginning from July 1, 2014.

The said commission is decided each year by the board of Directors and distributed amongst the Non-executive Directors based on their attendance and contribution at the Board and certain Committee meetings, as well as the time spent on operational matters other than at meetings.

l. The ratio of the remuneration of the highest paid Director to that of the employees who are not Directors but receive remuneration in excess of the highest paid Director during the year:

The ratio of remuneration of Mr. Shiv Nadar, the highest paid

Director to that of Mr. Anant Gupta, President & Chief Executive Officer, the highest paid employee is as under:

a) On Consolidated basis: 0.33:1

b) On Standalone basis: 0.24:1

m. Affirmation that the remuneration is as per the remuneration policy of the Company:

The Company affirms that the remuneration is as per the remuneration policy of the Company.

38. STATEMENT OF EMPLOYEES PURSUANT TO RULE 5(2) THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014

A statement containing the names of the employees employed throughout the financial year and in receipt of remuneration of Rs 60 lacs or more and employees employed for part of the year and in receipt of Rs 5 lac or more per month, pursuant to Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure 8 to this Report.

39. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has formulated and published a Whistle Blower Policy to provide Vigil Mechanism for employees including Directors of the Company to report genuine concerns and to ensure strict compliance with ethical and legal standards across the Company. The provisions of this Policy are in line with the provisions of the Section 177(9) of the Act and SEBI (Listing Obligation & Disclosure Requirements) Regulations, 2015, and are available on the website of the Company at http://www.hcltech.com/about-us/corporate-governance/ governance-policies. The details of Whistle Blower Policy forms part of the Corporate Governance Report annexed with this Report.

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

The Company has in place a Prevention and Redressal of Sexual Harassment at Work Place Policy in line with the requirements of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Company has constituted a committee for the redressal of all sexual harassment complaints. These matters are also being reported to the Audit Committee. The details of the Policy and the complaints are given under Corporate Governance Report and the Sustainability Report respectively.

41. ACKNOWLEDGEMENTS

The Board wishes to place on record its appreciation of the significant contributions made by the employees of the Company and its subsidiaries during the year under review. The Company has achieved impressive growth through the competence, hard work, solidarity, cooperation and support of employees at all levels. Your Directors thank the customers, clients, vendors and other business associates for their continued support in the Company's growth. The Directors also wish to thank the Government Authorities, Financial Institutions and Shareholders for their cooperation and assistance extended to the Company.

For and on behalf of the Board of Directors
Place: Noida (U.P.), India SHIV NADAR
Date : April 28, 2016 Chairman and Chief Strategy Officer

   

Adani Ports & Special Economic Zone Ltd     374.10   Up   3.80 (1.03%)   Asian Paints Ltd     1,400.65   Up   5.85 (0.42%)   Axis Bank Ltd     627.30   Up   3.85 (0.62%)   Bajaj Auto Ltd     2,661.35   Down   -6.15 (-0.23%)   Bajaj Finance Ltd     2,851.20   Down   -5.40 (-0.19%)   Bajaj Finserv Ltd     7,097.35   Up   21.35 (0.30%)   Bharat Petroleum Corporation Ltd     377.60   Down   -0.70 (-0.19%)   Bharti Airtel Ltd     371.40   Down   -0.60 (-0.16%)   Bharti Infratel Ltd     282.55   Up   1.90 (0.68%)   Cipla Ltd     646.90   Down   -1.45 (-0.22%)   Coal India Ltd     281.40   Down   -1.30 (-0.46%)   Dr Reddys Laboratories Ltd     2,364.15   Up   10.70 (0.45%)   Eicher Motors Ltd     28,476.15   Down   -327.70 (-1.14%)   GAIL (India) Ltd     387.70   Down   -6.10 (-1.55%)   Grasim Industries Ltd     1,045.85   Up   46.40 (4.64%)   HCL Technologies Ltd     1,003.05   Up   5.80 (0.58%)   HDFC Bank Ltd     2,077.35   Up   1.65 (0.08%)   Hero Honda Motors Ltd     3,242.30   Down   -40.35 (-1.23%)   Hindalco Industries Ltd     219.70   Up   3.60 (1.67%)   Hindustan Petroleum Corporation Ltd     267.55   Up   1.40 (0.53%)   Hindustan Unilever Ltd     1,784.75   Up   47.35 (2.73%)   Housing Development Finance Corporation Ltd     1,885.65   Down   -5.55 (-0.29%)   ICICI Bank Ltd     340.00   Up   5.70 (1.71%)   Indiabulls Housing Finance Ltd     1,266.90   Up   6.95 (0.55%)   Indian Oil Corporation Ltd     159.55   Up   1.05 (0.66%)   IndusInd Bank Ltd     1,990.40   Up   6.20 (0.31%)   Infosys Technologies Ltd     1,430.35   Up   0.80 (0.06%)   ITC Ltd     313.75   Up   6.30 (2.05%)   Kotak Mahindra Bank Ltd     1,263.25   Up   17.85 (1.43%)   Larsen & Toubro Ltd     1,240.15   Up   8.50 (0.69%)   Lupin Ltd     881.25   Up   31.50 (3.71%)   Mahindra & Mahindra Ltd     961.50   Up   10.25 (1.08%)   Maruti Suzuki India Ltd     9,152.10   Down   -48.45 (-0.53%)   NIFTY (S&P CNX)     11,470.75   Up   85.70 (0.75%)   NTPC Ltd     158.00   Down   -0.55 (-0.35%)   Oil & Natural Gas Corpn Ltd     163.05   Down   -1.40 (-0.85%)   Power Grid Corporation of India Ltd     187.10   Down   -0.60 (-0.32%)   Reliance Industries Ltd     1,203.75   Up   2.95 (0.25%)   State Bank of India     302.10   Up   9.40 (3.21%)   Sun Pharmaceuticals Industries Ltd     623.50   Up   3.80 (0.61%)   Tata Consultancy Services Ltd     2,012.75   Up   4.25 (0.21%)   Tata Motors Ltd     258.25   Up   6.95 (2.77%)   Tata Steel Ltd     580.15   Up   12.60 (2.22%)   Tech Mahindra Ltd     687.70   Up   19.05 (2.85%)   Titan Company Ltd     941.55   Up   22.10 (2.40%)   UltraTech Cement Ltd     4,285.70   Up   72.20 (1.71%)   UPL Ltd     616.75   Up   7.10 (1.16%)   Vedanta Ltd     215.20   Up   6.40 (3.07%)   Wipro Ltd     280.05   Up   0.60 (0.21%)   Yes Bank Ltd     393.20   Up   14.75 (3.90%)   Zee Entertainment Enterprises Ltd     503.50   Up   3.05 (0.61%)      NSE Data  -  www.nseindia.com (5 minutes delayed) syndicated by www.cmots.com