DIRECTORS' REPORT

Dear Shareholders,

Your Directors present the Twenty First Annual Report of IIFL Holdings Limited ('your Company') together with the Audited Financial Statements for the financial year ended March 31, 2016.

2. REVIEW OF BUSINESS AND OPERATIONS AND STATE OF YOUR COMPANY'S AFFAIRS

During the year, your Company's income, on a consolidated basis, increased to Rs. 39,957 million, up 12% year-on-year (y-o-y). Profit before tax increased to Rs. 8,426 million, up 16% y-o-y and Profit after tax before minority interest increased to Rs. 5,548 million, up 16% y-o-y.

The financing business continues to be a major contributor to the Group's income with 72% share. The retail home loan business has gained significantly and Loan book grew by 168% to Rs. 52,843 million as of March 31, 2016 as against Rs. 19,736 million in the previous year. The wealth management business witnessed a steady growth with assets under advice, distribution and management increased by 12% y-o-y to Rs. 794 billion as at March 31, 2016. The income from capital market activities, equity broking and related income stood at Rs. 4,397 million, down 2% y-o-y while, income from marketing and distribution of financial products such as mutual fund, life insurance etc. increased to Rs. 6,748 million from Rs. 5,827 million in the previous year, up 16% y-o-y.

There is no change in the nature of business of the Company. There were no significant or material orders passed by regulators or courts or tribunals impacting the going concern status and Company's operations in future.

3. MACROECONOMIC OVERVIEW

India remains one of the fastest growing economies in the world. The outlook for global economy is not sanguine with considerable uncertainties regarding path of monetary policy in advanced economies, the extent of slowdown in China and the fallout from the possible exit of UK from the EU otherwise known as 'Brexit'.

The Indian economy has grown at a respected rate of just over 7% in the last two years despite two back to back droughts. However, with forecast of a above normal monsoon, GDP growth rate is likely to improve further in FY17 and is expected to cross 8% over the medium-term. Inflation has fallen from almost 10% three years back to 5% now and current account deficit too has fallen to just 1% of GDP. The new government has continued the path of fiscal consolidation and thus fiscal deficit is likely to fall to 3.5% of GDP this year. This has brought much needed stability on the external sector despite challenging global economic backdrop and allowed the RBI to cut interest rates, which will help revive investments in the economy.

Government's efforts at kick starting the investment cycle is showing some signs of improvement in sectors such as roads, railways and power. A number of indicators from two-wheeler sales to electricity generation to cement demand suggest that economic activity is picking up. Low capacity utilisation in many sectors will however keep industrial capex muted until there is  broad based recovery in domestic demand. The Union Budget struck a fine balance between maintaining fiscal prudence and stepping up public investments as well as supporting the under-stress rural economy. The recent passage of key reforms like Real Estate Development Bill, Insolvency and Bankruptcy Code, Aadhaar Bill and initiatives for ease of doing business etc would help in solving certain major implementation hurdles and orderly developments, thereby increasing efficiency. Make in India, Skill Development will also aid in creating the much needed jobs to absorb India's growing working age population.

4. DIVIDEND ON EQUITY SHARES

During 2015-16, your Company declared and paid an interim dividend of Rs. 4.25 per equity share (i.e. 212.5% of face value of Rs. 2/- per share) which includes a special dividend of Rs. 1.25 per share, to commemorate a decade of listing. This led to an outgo of Rs. 1,341 million owing to dividend (excluding dividend distribution tax).The same is considered as final. The total dividend paid during the financial year 2015-16 was Rs. 4.25/- per share.

5. KEY INITIATIVES/DEVELOPMENTS i. Open offer by Fairfax Group

Fairfax Group belonging to the reputed global investor Mr. Prem Watsa of Canada, through its group company i.e. FIH Mauritius Investments Limited (FIH), Mauritius, announced an open offer for the acquisition of 83,128,852 equity shares of Rs. 2/- each from the equity shareholders of IIFL Holdings Limited constituting 26% of the post-offer equity share capital of the Company on July 14, 2015 under SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.

Pursuant to this, FIH has successfully completed the open offer on November 30, 2015 and acquired 68,788,445 shares at a price of Rs. 195/- per share constituting 21.85% of the paid up Share Capital of the Company as on that date. The Promoters of the Company did not participate in the open offer.

Fairfax Group through FIH and HWIC Asia Fund (class A shares) holds 30.55% of the paid up share capital of the Company as on March 31, 2016. Also, Fairfax Group through United States Fire Insurance Company ("USFIC") and Odyssey Reinsurance Company ("ORC") have an economic interest in the underlying Equity shares, representing 5.15% of the total paid up equity capital of the Company as on March 31, 2016, through cash-settled offshore derivative instruments. Thus, Fairfax Group's aggregate shareholding in the Company stands at 35.70% as on March 31, 2016.

As mentioned in the Offer Letter, this investment by Fairfax Group is only as a financial investor without change of Control or Management of the Company. The Management and Control of the Company will continue with the existing Promoters.

ii. Strategic Investment by General Atlantic in wealth management subsidiary

General Atlantic Singapore Fund Pte. Ltd (GA), a leading global growth equity firm, made a strategic investment in IIFL Wealth Management Limited ("IIFLW"), the wealth management subsidiary of the Company. GA invested Rs. 9,038 million in IIFLW, through fresh issue of equity shares and additionally Rs. 1,591 million for acquisition of shares from employees of IIFLW. Pursuant to this, GA holds a total stake of 21.61% in the equity of IIFLW, on fully diluted basis (assuming full conversion of outstanding ESOP's of IIFLW). GA's investment will help to support IIFLW's continued growth and platform expansion as the premier wealth management Company in India.

iii. IIFL Wealth Finance Limited

IIFL Wealth Management Limited has acquired 100% equity and management of Chephis Capital Markets Limited, a Non Deposit Taking Non Systematically Important NBFC [ND -Non SI] in February, 2016 after obtaining necessary RBI and other approvals. The name of the Company was subsequently changed to IIFL Wealth Finance Limited (IIFLW Finance). IIFLW Finance will provide Loan against Securities facilities to IIFL Wealth clients. IIFLW has invested Rs. 9,000 million out of investments received from GA towards equity into IIFLW Finance. IIFLW Finance has commenced its lending business and the total loan asset(s) as on March 31, 2016 was about Rs. 1,000 million.

iv. Investment Banking

The last financial year has been a defining year for investment banking. IIFL Holdings completed 10 transactions viz. IPOs, QIPs, NCD placements, pre IPO placements etc enabling mobilization/placement of around Rs. 32,756 million in 2015-16, the largest number of Investment Banking transactions executed by IIFL in its history in a single financial year.

Our efforts and investments into this business are beginning to pay off. Clients value us as their trusted advisor and have been delighted with IIFL's services.

v. India Infoline Finance Limited

The Company acquired 1.13% of the Equity share Capital of M/s. India Infoline Finance Limited, the Non Banking Financial subsidiary of the Company, from M/s. Bennett Coleman & Company Ltd. Pursuant to the said acquisition, India Infoline Finance Limited and India Infoline Housing Finance Limited (subsidiary of India Infoline Finance Limited) have become 100% subsidiaries of the Company.

vi. Asset Management

During the year, the name of India Infoline Asset Management Company Limited (IIFL AMC) was changed to IIFL Asset Management Limited.

Under IIFL Mutual Fund Platform, the assets under management have increased from Rs. 3,524 million to Rs. 4,923 million. During the year, the IIFL Dividend Opportunities Index Fund and IIFL Nifty ETF were merged with IIFL India Growth Fund.

Under IIFL's Alternative Investment Fund(s) platform (IIFL AIF), the following schemes were launched during the year:

a. IIFL Best of Class Fund I (Category III) - focused on investment in equity and equity related securities of listed Indian companies.

b. I IFL Cash Opportunities Fund (Category III) - with the objective of primarily investing in debt and quasi debt securities.

c. IIFL Investment Opportunities Fund Series 1 (Category III) - investments focused on multiple asset classes including equity and equity linked instruments, private equity, fixed income instruments, debt and debt related instruments of Companies.

d. IIFL Asset Revival Fund Series 2 (Category III) - focused on investments in securities with depressed valuations but having a high probability of benefitting from improving macro-economic scenario in the medium to long term.

e. IIFL Seed Ventures Fund 1, (Category II) - with investment objective of primarily investing in private equity, alternative investment funds and venture capital funds, registered with SEBI, and securities of unlisted entities.

f. I IFL Real Estate Fund Domestic Series III (Category II) - focused on investing in equity, debt and Equity Linked Instruments involved in projects or ventures that have significant growth potential in the real estate sector in India.

The total assets managed by IIFL AMC under Mutual Fund, AIF and Portfolio Management Services have increased to Rs. 57,371 million as on March 31, 2016 vis-a-vis Rs. 22,056 million as on March 31, 2015.

vii. Corporate Social Responsibility

During the financial year, your Company deployed 1.92% of its average net profits (computed as per the relevant provisions of Companies Act 2013) of the preceding three years on CSR projects. At the group level, besides the Company, eight subsidiary companies came under the purview of the provisions for CSR for the year. During the fiscal year 2015-16, the group made a total deployment of Rs. 98.19 million into CSR activities.

All CSR efforts are directed towards identifying and undertaking projects that hold potential and promise to create long-term social impact, to empower marginalized communities and enhance their quality of life. In alignment with this objective, in financial year 2015-16, the Company undertook a number of projects in the core areas of water management, livelihoods, healthcare, education and financial literacy.

Drought relief, water conservation and building rainwater harvesting structures were key focus areas of CSR in 2015­16. While IIFL built two check dams and over 50 different rainwater harvesting structures this year with a long-term objective, many efforts were undertaken to create a base for expanding this activity to a much bigger scale in years to come. IIFL has vowed to make the tribal areas of Jawhar and Mokhada drought free and it took concrete steps towards that direction in this financial year.

IIFL's CSR has gained the necessary momentum to implement large scale projects, which will have substantial sustainable impact. The capabilities, systems and processes needed to take up big activities in an organised manner are also in place. Going forward, the Company will broaden the scope of CSR projects not only vertically but also horizontally to create a much bigger and wider impact.

The Annual Report on CSR activities by the Company is annexed herewith as "Annexure - I".

viii. Investor Conference

IIFL's Enterprising India Global Investors' Conference

I IFL's Seventh Enterprising India Conference concluded on 19 February, 2016. More than 100 companies and 600 investors participated in the three-day event that had across-the-board presence of all sectors. Given the backdrop of technological innovations emerging as disruptive forces across businesses, the theme for 2016 Conference was "Excelling in the Digital Age". A distinguished panel of 24 experts provided expert opinions and insights into trends. Coming right before the budget, IIFL's Enterprising India Conference set the tone to jump-start the year with timely, accurate, and granular insights.

Express Addas

IIFL Private Wealth has associated with The Indian Express to put together Express Adda, a series of freewheeling dialogues on contemporary issues with newsmakers in an informal setting. The event was held in New Delhi and Mumbai.

Seed Venture Funds Conclave

Enhanced by the power of technology, the last couple of years have witnessed India becoming one of the start­up hubs that are poised to re-define business. IIFL Wealth Management hosted Power Start-Ups, a series of conclaves in Mumbai, Delhi, Jaipur, Bangalore, Chennai, Kolkata and Pune. Start-up stalwarts along with our own in-house experts spoke at length about various facets and trends emerging from the milieu.

India Alternatives Investor Conference

India Alternatives, a private equity fund sponsored by IIFL Private Wealth, held its investor conference in March 2016 at Mumbai with an illustrious panel of speakers and well attended by investors.

Awards and Recognitions

The following awards were conferred in FY16

1. 'India's Most Trusted Financial Service Brand (Non-Bank)' by the Brand Trust Report India Study, 2016. This is an intensive survey covering 20,000 brands across the country.

2. www.indiainfoline.com won Best Website in the Banking & Investment category from Website of The Year India 2015.

3. ' Best Customer Service in Financial Sector' by 'World Quality Congress - service quality awards.

4. Mumbai Hot 50 brands award in the B2C category' by Mumbai Brand Summit.

5. 'Most accurate predictor of Sensex closing levels in 2015' by Bloomberg Poll.

6. I IFL's Budget 2015-16 campaign #BolIndiaBol won in the 'Most innovative use of social media' category at the IPRCCA 2015

7. Dr. Sarika Kulkarni, CEO of IIFL Foundation, was presented with the prestigious '100 Most Impactful CSR Leaders Award (Global Listing)'at World CSR Day

8. 'Outstanding Private Bank - South Asia (Highly Commended), 2015' by Private Banker International (PBI) Global Wealth Awards, 2015.

9. 'Best Wealth Management Advisory Firm India 2015' by the International Finance Magazine (IFM) Awards, 2015.

10. 'Best Private Bank for Innovation In Technology India 2015' by the International Finance Magazine (IFM)  Awards, 2015.

11. 'Best Domestic Private Bank in India - Overall' by Asiamoney Private Banking Poll, 2015.

12. 'Best Domestic Private Bank in India >$25 million' by Asiamoney Private Banking Poll, 2015.

13. ' Best Wealth Management Firm - India' by the APAC Insider Investment Awards.

14. 'Best Domestic Private Bank-India' by the Asian Private Banker Awards of Distinction.

15. Best Online Wealth Management Experience, by The Asset Triple A Digital Enterprise Awards.

16. Best Private Banking Services Overall, India by the Euromoney Private Banking and Wealth Management Survey, 2016.

17. Best Research and Asset Allocation Advice, India by the Euromoney Private Banking and Wealth Management Survey, 2016.

18. Best Net-worth-specific services, India, by the Euromoney Private Banking and Wealth Management Survey, 2016.

19. Best Family Office Services, India by the Euromoney Private Banking and Wealth Management Survey, 2016.

20. Mr. Arun Malkani, Chief Marketing Officer, was a recipient of the Most Talented Marketing Professional (Financial Services Sector) award by the World Marketing Congress and CMO Council.

6. SHARE CAPITAL

During the period under review, the total share capital of the Company has increased from Rs. 620,467,896/- to Rs. 633,073,706/-pursuant to allotment of 6,302,905 equity shares of Rs. 2/- each under Employee Stock Option Scheme(s) of the Company to the eligible employees.

7. EMPLOYEES STOCK OPTION SCHEMES (ESOS)

The Company granted 900,000 stock options to employees during the year under its Employee Stock Option Scheme 2008. The details of such grant and other particulars regarding Employee Stock Options are attached as "Annexure - II".

During the year under review, 611,000 stock options under ESOS 2007 and 461,500 stock options under ESOS 2008 granted to employees have lapsed and the same have been added back to the pool which can be used for further grant.

8. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Particulars of investments made, loans given, guarantees given and securities provided along with the purpose for which the loan or guarantee or security was proposed to be utilized by the recipient are given in the standalone financial statement (please refer to Note 09, 14 and 26 to the standalone financial statement).

9. SUBSIDIARY COMPANIES

As on March 31, 2016, the Company had 31 (Thirty One) subsidiaries (including step down subsidiaries) / Associates located in India and overseas. During the year, IIFL Wealth Management Limited, a subsidiary of the Company, acquired 100% stake in IIFL Wealth Finance Limited (formerly known as Chephis Capital Markets Limited). The Company has also acquired 1.13% of the Equity share Capital of M/s. India Infoline Finance Limited, the Non Banking Financial subsidiary of the Company, from M/s. Bennett Coleman & Company Ltd. Pursuant to the said acquisition, India Infoline Finance Limited and India Infoline

Housing Finance Limited (subsidiary of India Infoline Finance Limited) have become 100% subsidiaries of the Company.

As per Section 134 and 136 of the Companies Act, 2013 read with applicable Rules, the Board of Directors had at their meeting held on May 05, 2016 approved attaching the consolidated financials of all the subsidiaries of the Company along with the Company's financial statements. Copies of the Balance Sheet, Profit and Loss Account, Report of the Board of Directors and Report of the Auditors of each of the subsidiary companies are not attached to the accounts of the Company for the financial year 2015-16. The Company will make these documents/details available upon request by any member of the Company. These documents/ details will also be available for inspection by any member of the Company at its registered office and at the registered offices of the concerned subsidiaries. The Annual Report of all the subsidiaries will be uploaded on the website of the Company. As required by Companies Act, 2013 and Accounting Standard - 21 (AS 21) issued by the Institute of Chartered Accountants of India, the Company's consolidated financial statements included in this Annual Report incorporates the accounts of its subsidiaries. A report on the performance and financial position of each of the subsidiaries, associates and joint ventures companies as per the Companies Act, 2013 is provided as Annexure A of the Consolidated financial statement and hence not repeated here for the sake of brevity.

Pursuant to regulation 16 and 24 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, India Infoline Finance Limited was the Material Subsidiary of the Company for the financial year 2015-16.

For the financial year 2016-17, the following are the Material Subsidiaries of the Company:

i. India Infoline Finance Limited

ii. IIFL Wealth Management Limited

iii. IIFL Wealth Finance Limited

The policy on determining the material subsidiary is available on the website of the Company at www.indiainfoline.com

10. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In accordance with Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Management Discussion and Analysis Report forms part of this report.

11. DIRECTORS AND KEY MANAGERIAL PERSONNEL a. Change in Directors

The Board comprises of Mr. Nirmal Jain and Mr. R. Venkataraman as Executive Directors of the Company in their capacity of Chairman and Managing Director respectively. Mr. Nilesh Vikamsey, Mr. A. K. Purwar, Mr. Kranti Sinha, Dr S. Narayan and Ms Geeta Mathur are Independent

Directors and Mr. Chandran Ratnaswami is a non-executive Director of the Company. Mr. Sunil Kaul, Non Executive Director of the Company, resigned with effect from January 20, 2016.

In accordance with Section 152 of the Companies Act, 2013 ("Act") read with Article 137 of the Articles of Association of the Company, Mr. Nirmal Jain, Mr. R. Venkataraman and Mr. Chandran Ratnaswami are liable to retire by rotation at the ensuing Annual General Meeting. Being eligible, they offer themselves for reappointment. The Board recommends the same for shareholders' approval.

O Meetings of the Board of Directors

The Board met 5 (Five) times during the year to discuss and approve various matters including financials, appointment of auditor, declaration of dividend, appointment of Key Management Personnel (KMP), review of audit reports and other board businesses. For further details please refer to the report on Corporate Governance.

O Committees of the Board

I n accordance with the applicable provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board constituted the following Committees: Audit Committee

Nomination and Remuneration Committee Corporate Social Responsibility Committee Stakeholders Relationship Committee Risk Management Committee

• Audit Committee

The Audit Committee comprises of Mr Nilesh Vikamsey, Mr Kranti Sinha, Ms. Geeta Mathur and Mr R. Venkataraman. The role, terms of reference and powers of the Audit Committee are in conformity with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Committee met 5 (five) times during the year under review and discussed on financials, audit reports and appointment of auditors. During the period under review, the Board of Directors of the Company accepted all the recommendations of the Audit Committee.

The terms of reference of Audit Committee and other details thereof has been provided in the Corporate Governance Report.

Nomination and Remuneration Committee

The Nomination and Remuneration Committee comprises of three Independent Directors with  Mr Kranti Sinha as the Chairman of the Committee, Mr Nilesh Vikamsey and Mr A K Purwar as members of the Committee.

The role, terms of reference and powers of the Nomination and Remuneration Committee are in conformity with the requirements of the Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the same has been provided in the Corporate Governance Report.

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a Nomination and Remuneration policy in compliance with the aforesaid provisions for selection and appointment of Directors, KMP, senior management personnel of the Company. The said policy is stated in the Corporate Governance Report of the Company.

Corporate Social Responsibility Committee

As per the provision of Section 135 of the Companies Act, 2013, the Company has constituted Corporate Social Responsibility (CSR) Committee, comprises of Mr Nilesh Vikamsey, Mr Nirmal Jain and Mr R. Venkataraman. The Committee has approved CSR Policy of the Company. The group has set-up India Infoline Foundation (generally referred as "IIFL Foundation") a Section 8 Company under the Companies Act, 2013, which will act as the principal arm to undertake CSR initiatives on behalf of the IIFL Group. The policy on corporate social responsibility is available on the website www.indiainfoline.com The Annual Report on Corporate Social responsibility is attached as "Annexure - I".

Stakeholders Relationship Committee

I n compliance with the provision of section 178 of the Companies Act, 2013, the Company has renamed the Share Transfer and Investor Grievance Committee as the "Stakeholders' Relationship Committee".

The role, terms of reference of the Stakeholders Relationship Committee are in conformity with the requirements of the Companies Act, 2013 and Regulation 20 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the same has been provided in the Corporate Governance Report.

The Stakeholders Relationship Committee comprises of Ms. Geeta Mathur, Independent Director as the Chairperson, Mr Nirmal Jain and Mr R. Venkataraman, Executive Directors as the Members. During the financial year 2015-2016, the Company received 31 complaints from investors under SEBI's SCORES portal. All complaints were redressed to the satisfaction of the investors. No complaints were pending either at the beginning or at the end of the year.

Risk Management Committee

In compliance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Companies Act, 2013, the Company has constituted a Risk Management Committee. The objective of the Committee is to oversee the risk management governance structure, define and review the framework for identification, assessment, monitoring, mitigation and reporting of risks.

The Risk Management Committee comprises of Mr. A. K. Purwar, Independent Director, Mr Nilesh Vikamsey, Independent Director and Mr Nirmal Jain, Executive Director.

O Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Board of Directors has carried out an annual performance evaluation of its own performance, the Directors individually including Independent Directors. The manner in which the evaluation has been carried out is explained in the Corporate Governance Report.

I n compliance with the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Independent Directors held a meeting on March 31, 2016, and they, inter alia:

• Reviewed the performance of Non-Independent Directors and the Board as a whole Reviewed the performance of the Chairperson of the Company

Assessed the quality, quantity and timeliness of flow of information between the Company's 12. management and the Board, which is necessary for the Board to effectively and reasonably perform their duties

The Independent Directors expressed their satisfaction with overall functioning and implementations of their suggestions.

O Declaration by Independent Directors

The Company has received necessary declaration from each Independent Director under section 149(7) of the Companies Act, 2013 that he/she meets the criteria of independent laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations,  2015.

b. Key Managerial Personnel

As per the definition of Key Managerial Personnel as contained in section 2(51) of the Companies Act, 2013, the "Key Managerial Personnel" in relation to the Company are:

O Chief Executive Officer or Managing Director

• Whole-time Director

O Company Secretary

O Chief Financial Officer

O And, such other officer as may be prescribed

During the period, Mr. Nirmal Jain (DIN: 00010535) was  appointed as the Whole Time Director designated as the Executive Chairman of the Company for a term of five years with effect from April 23, 2015 and Mr. R Venkataraman (DIN: 00011919) was appointed as the Whole Time Director designated as the Managing Director of the Company for a term of five years with effect from April 23, 2015.

Mr. Prabodh Agrawal was appointed as the Chief Financial Officer of the Company with effect from January 29, 2016 in place of Mr. Parag Shah who continue as the Chief Financial Officer of a Subsidiary of the Company.

Mr Gajendra Thakur was appointed as the Company Secretary of the Company with effect from June 09, 2015 in place of Mr. Ashutosh Naik who continue as the Company Secretary of a Subsidiary of the Company.

The Remuneration and other details of the Key Managerial Personnel for the year ended March 31, 2016 are mentioned in the Extract to the Annual Return in Form MGT-9, which is attached as "Annexure - III" and forms a part of this report of the Directors.

DIRECTORS' RESPONSIBILITY STATEMENT

The Board of Directors acknowledge the responsibility for ensuring compliances with the provisions of section 134(3) (c) read with Section 134(5) of the Companies Act, 2013, Clause 49 (III) (D) (4) (a) of the Listing Agreement with Stock Exchanges (applicable up to November 30, 2015) and provisions  of SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015 and based on the information provided by the management, your Directors state that:

a) in the preparation of the annual accounts for the year ended March 31, 2016, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;

b) the Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2016 and of the profit of the Company for the year ended on that date;

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

d) the Directors have prepared the annual accounts on a 'going concern' basis;

e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

13. RISK MANAGEMENT

Your Directors have in place Risk Management Committee to assist the Board in (a) overseeing and approving the company's enterprise wide risk management framework; and (b) overseeing that all the risks that the organisation faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed. There is an adequate risk management infrastructure in place capable of addressing those risks.

The Company's management monitors and reports principal risks and uncertainties that can affect its ability to achieve its, strategic objectives. The Company's management systems, organisational structures, policy, processes, standards and code of conduct together form risk management governance system of the Company.

The Company has in place a Risk Management Policy and introduced several process improvements to internal controls systems and processes to drive a common integrated view of risks and optimal and mitigation responses. This integration is enabled through suitable co-ordination across group wide Risk Management, Internal Control and Internal Audit methodologies and processes.

14. INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal controls with reference to financial statements and operations and the same are operating effectively. The Internal Auditors tested the design and effectiveness of the key controls and no material weaknesses were observed in their examination. Further, Statutory Auditors verified the systems and processes and confirmed that the Internal Financial Controls system over financial reporting are adequate and such controls are operating effectively.

15. CONTRACTS AND ARRANGEMENTS WITH RELATED  PARTIES

The Company has put in place a policy for Related Party Transactions (RPT Policy), which has been approved by the Board of Directors. The policy provides for identification of RPTs, necessary approvals by the Audit Committee/Board/ Shareholders, reporting and disclosure requirements in compliance with Companies Act, 2013, Listing Agreement with Stock Exchanges (applicable up to November 30, 2015) and provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

All contracts executed by the Company during the financial year with related parties were on arm's length basis and in the ordinary course of business. All such Related Party Transactions were placed before the Audit Committee for approval, wherever applicable.

During the year, the Company has not entered into any contract / arrangement / transaction with related parties, which could be considered material in accordance with Regulation 23 of SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015 and the policy of the Company on materiality of related party transactions. The policy for determining 'material' subsidiaries and the policy on materiality of Related Party Transactions and dealing with Related Party Transactions as approved by the Board may be accessed on the Company's website www.indiainfoline.com. You may refer to Note no. 31 to the financial statement, which contains related party disclosures. Since all related party transactions entered into by the Company were on an arm's length basis and in the ordinary course of business and the Company had not entered into any material related party contracts, Form AOC-2 disclosure is not required to be provided.

16. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return of the Company in form MGT - 9 is annexed herewith as "Annexure - III'!

17. MATERIAL CHANGES AND COMMITMENTS AFFECTING

THE FINANCIAL POSITION OF THE COMPANY

There have been no material changes and commitments affecting the financial position of the Company, which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of this annual report

18. SECRETARIAL AUDIT

The Board had appointed M/s. Nilesh Shah & Associates, Practicing Company Secretaries, to conduct Secretarial Audit of the Company for the year 2015-16. The Auditor had conducted the audit and their report thereon was placed before the Board. The report of the Secretarial Auditor is annexed herewith as "Annexure - IV". There are no qualifications or observations in the Report.

19. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The additional information on energy conservation, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Companies Act, 2013 read with Rule, 8 of the Companies (Accounts) Rules, 2014, is appended as "Annexure - V" to and forms part of this Report.

20. WHISTLE BLOWER POLICY/ VIGIL MECHANISM

In Compliance of the Companies Act, 2013 and Regulations 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has adopted a Whistle Blower Policy and has established the necessary vigil mechanism for Directors, Employees and Stakeholders to report genuine concerns about unethical behaviour, actual or suspected fraud or violation of the Company's code of conduct or ethics policy.

21. PREVENTION OF SEXUAL HARASSMENT

Your Company recognizes its responsibility and continues to provide a safe working environment for women, free from sexual harassment and discrimination. In Compliance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has put in place a Policy on prevention of Sexual Harassment of Women at workplace.

Your Directors further state that the during the fiscal year 2015­16, there were no complaints received pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The following is reported pursuant to Section 22 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:

a) Number of complaints received in the year : Nil

b) Number of complaints disposed off during the year : Nil

c) Number of cases pending more than ninety days: Nil

d) Number of workshops or awareness programme against sexual harassment carried out: Five

e) Nature of action taken by the employer or district officer: Not applicable

22. PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in "Annexure - VI".

Further, a statement showing the names and other particulars of employees drawing remuneration in excess of the limits as set out in the Rules 5(2) and 5(3) of the aforesaid Rules, forms part of this report. However, in terms of first proviso to Section 136(1) of the Act, the Annual Report and Accounts are being sent to the members and others entitled thereto, excluding the aforesaid information. The said information is available for inspection by the members at the Registered Office of the Company during business hours on working days up to the date of the ensuing Annual General Meeting. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary, whereupon a copy would be sent.

23. STATUTORY AUDITORS

M/s. Sharp & Tannan Associates, Chartered Accountants, Mumbai (Firm Registration Number: 109983W), retire at the ensuing Annual General Meeting holding office as such till the conclusion of the ensuing Annual General Meeting (AGM) and being eligible have offered themselves for re-appointment. Pursuant to the provisions of Section 139 of the Companies Act, 2013 and the Rules framed there under, the Board proposes reappointment of M/s. Sharp & Tannan Associates as Statutory Auditors of the Company from conclusion of this AGM till the conclusion of the next AGM. M/s. Sharp & Tannan Associates have furnished a certificate to the effect that the proposed re-appointment, if made, will be in accordance with the provisions of Section 139 and 141 of the Companies Act, 2013. The Auditors' Report for the financial year 2015-16 does not contain any qualification, reservation or adverse remarks.

24. FEMA COMPLIANCE

During the year, the Company received the FIPB approval vide its letter no. F No. 96(2016)/19(2015) dated November 20, 2015 for increasing the foreign investments limit from 50.16% to 80% of equity by FIIs/FDI and the Company is in compliance with the conditions mentioned therein. Pursuant to RBI Master circular No. 15/2015-16 dated July 01, 2015, the Statutory auditor of the Company has certified confirming compliances with regards to Regulations on downstream investments and other FEMA provisions.

25. CORPORATE GOVERNANCE

As per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company's Statutory auditor confirming compliance forms an integral part of this Report.

26. GENERAL

Your Directors state that during the financial year 2015-16: 1. The Company did not accept/renew any deposits within the meaning of Section 73 of the Companies Act, 2013 and the rules made there under and as such, no amount of principal or interest was outstanding as on the balance-sheet date.

2. The Company has not issued equity shares with differential rights as to dividend, voting or otherwise.

3. The Company has not issued any sweat equity shares during the year.

4. There are no significant and material orders passed against the Company by the Regulators or Courts or Tribunals, which would impact the going concern status of the Company and its future operations.

27. APPRECIATION

Your Directors place on record their sincere appreciation for the assistance and guidance provided by the government, regulators, stock exchanges, other statutory bodies and Company's bankers for the assistance, cooperation and encouragement extended to the Company.

Your Directors also gratefully acknowledge all stakeholders of the Company viz. customers, members, dealers, vendors, banks and other business partners for the excellent support received from them during the year. Our employees are instrumental in the Company to scale new heights, year after year. Their commitment and contribution is deeply acknowledged. Your involvement as shareholders is also greatly valued. Your Directors look forward to your continuing support.

For and on behalf of the Board

Nirmal Jain

Chairman DIN:00010535

Date: May 05, 2016

Place: Mumbai