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நிறுவன பெயரின் முதல் சில எழுத்துக்களை நிரப்பி 'கோ' பட்டனை கிளிக் செய்யவும்

Aditya Birla Capital Ltd. இன் கணக்கு குறிப்புகள்

Mar 31, 2023

a) Securities Premium: Securities Premium Reserve is used to record the premium on issue of shares. The reserve is utilised in accordance with the provisions of the Act.

b) Special Reserve: Special Reserve represents reserve created pursuant to the Reserve Bank of India Act, 1934 (“the RBI Act”). In terms of Section 45-IC of the RBI Act, a Non-Banking Finance Company is required to transfer an amount not less than 20 per cent of its net profit to a Reserve Fund, before declaring any dividend. Appropriation from this Reserve Fund is permitted only for the purposes specified by RBI.

c) General Reserve: General Reserve represents vested ESOPs that have lapsed. As the general reserve is created by a transfer from one component of equity to another, and is not an item of other comprehensive income, items included in the general reserve will not be reclassified subsequently to profit or loss.

d) Capital Reserve: It represents reserve created during demerger from Grasim Industries Limited.

e) Employee Share Options Outstanding: The Company has stock options schemes, under which options to subscribe for the Company’s shares have been granted to certain employees, including key management personnel. The Employee Share Options Outstanding reserve is used to recognise the value of equity-settled share-based payments provided to employees, as part of their remuneration.

NOTE: 32 CONTINGENT LIABILITIES AND COMMITMENTSa) Contingent Liabilities

The Company has issued Corporate Guarantees to National Housing Bank on behalf of its subsidiary Aditya Birla Housing Finance Limited (ABHFL) of '' 3,500 crore up to 31st March 2023 (Previous Year '' 2,500 crore), against which the amount outstanding in the books of ABHFL as at 31st March 2023 is '' 2,057.71 crore (Previous Year '' 1,498.73 crore). As per the terms of the Guarantee, the Company’s liability is capped at the outstanding amount on invocation.

b) Capital Commitments

i) The Company has '' 0.37 as commitments towards Property, Plant and Equipment as at 31st March 2023 (Previous Year '' Nil).

ii) Pursuant to the Shareholders’ Agreement entered into with Sun Life Financial (India) Insurance Investments Inc. and its holding Company Sun Life Assurance Company of Canada by Aditya Birla Capital Limited, in respect of Aditya Birla Sun Life Insurance Company Limited (ABSLI), the Company will infuse its share of capital in ABSLI from time to time to meet the solvency requirement, prescribed by the regulatory authority. Transfer of investments in ABSLI is restricted by the terms contained in Shareholders'' Agreements entered into by the Aditya Birla Capital Limited.

iii) Pursuant to the Shareholders’ Agreement entered into with Momentum Metropolitian Strategic Investments (Proprietary) Limited and Platinum Jasmine A 2018 Trust by Aditya Birla Capital Limited, in respect of Aditya Birla Health Insurance Co. Limited (ABHI), the Company will infuse its share of capital in ABHI from time to time to meet the solvency requirement, prescribed by the regulatory authority.

b) Stock Options and Performance Stock Unit Scheme 2022

The shareholders of the Company, vide a special resolution passed through Postal Ballot on 16th October 2022, approved the Scheme titled “Aditya Birla Capital Limited Employee Stock Options and Performance Stock Unit Scheme 2022” (“ABCL Scheme 2022”) for granting Employee Stock Options (“Options”) and Employee Performance Stock Units (“PSUs”) (collectively referred to as the (“Stock Options”) exercisable into not more than 41,071,270 Equity Shares. ABCL Scheme 2022 allows the grant of Stock Options to employees of the Company, and its group company(ies), including its Holding Company and Subsidiary Company(ies) and Associate Company(ies) (whether working in India or outside India), that meet the eligibility criteria. Each Stock Option confers a right upon the Grantee to apply for 1 (one) Equity Share. Out of these, the Nomination, Remuneration and Compensation Committee has granted 13,954,991 Options and 6,360,714 PSUs under ABCL Scheme 2022.

NOTE: 36 ABCL INCENTIVE PLAN 2017

The Scheme titled as “ABCL Incentive Scheme for Stock Options and Restricted Stock Units - 2017 (ABCL Incentive Scheme)” was approved by the shareholders through postal ballot on 10th April 2017. The Nomination, Remuneration and Compensation Committee of the Company, at its meeting held on 15th January 2018, granted 1,465,927 ESOPs and 252,310 Restricted Stock Units (RSUs) (collectively called as “Stock Options”) to the eligible grantees, pursuant to the Composite Scheme of Arrangement between erstwhile Aditya Birla Nuvo Limited (now merged with Grasim Industries Limited), Grasim Industries Limited and Aditya Birla Capital Limited. The Stock Options allotted under the Scheme are convertible into equal number of Equity Shares.

NOTE: 39 FAIR VALUES

The Management assessed that Fair Values of Financial Assets and Liabilities are approximately their carrying values.

NOTE: 40 FINANCIAL INSTRUMENTS - ACCOUNTING CLASSIFICATIONS AND FAIR VALUE MEASUREMENTS

The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

Principles for Estimating Fair Value

The following summarises the major methods and assumptions used in estimating the fair values of financial instruments reflected in the table.

Fair Value Hierarchy

The table below analyses financial instruments carried at fair value, by valuation method at 31st March 2023. The different levels have been defined as follows:

Level 1: Category includes financial assets and liabilities that are measured in whole or in significant part by reference to published quotes in an active market.

Level 2: Category includes financial assets and liabilities measured using a valuation technique based on assumptions that are supported by prices from observable current market transactions. These include assets and liabilities for which pricing is obtained via pricing services, but where prices have not been determined in an active market, financial assets with fair values based on broker quotes and assets that are valued using the Company''s own valuation models whereby the material assumptions are market observable.

Level 3: Category includes financial assets and liabilities measured using valuation techniques based on non-market observable inputs. This means that fair values are determined in whole or in part using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data. However, the fair value measurement objective remains the same, that is, to estimate an exit price from the perspective of the Company. The main asset classes in this category are unlisted equity investments as well as unlisted funds.

The carrying amount of trade payables, other financial liabilities, loans, other financial assets, cash and cash equivalents, as at 31st March 2023 and 31st March 2022 are considered to the same as fair values, due to their short-term nature. These are classified as Level 3 fair value hierarchy, due to inclusion of unobservable inputs including counterparty credit risk.

During the reporting period ending 31st March 2023, there were no transfers between Level 1 and Level 2 fair value measurements.

Assumptions to above:

* The Fair Valuation of Preference Shares is based on independent valuers report.

* The Fair Valuation of Unquoted Mutual Funds Units is done based on NAV of units.

NOTE: 41 FINANCIAL RISK MANAGEMENT

The Company, being a Core Investment Company as per the Core Investment Companies (RBI) Directions, 2016, is required to invest or lend majority of its funds to its Subsidiaries, Joint Ventures and Associates. The Company’s principal financial liabilities comprise trade, and other payables. The main purpose of these financial liabilities is to support the Company’s operations. The Company’s principal financial assets include investments, inter-corporate deposits, cash and cash equivalents, and other receivables.

The Company is exposed to certain financial risks, such as equity investment risk, market risk, credit risk and liquidity risk. The Company’s Senior Management oversees the management of these risks. The Company’s Senior Management is supported by a Risk Management Committee, that advises on financial risks and the appropriate financial risk governance framework for the Company. The Risk Management Committee provides assurance to the Company’s Senior Management that the Company’s financial risk activities are governed by appropriate policies, and procedures, and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives. The major risks are summarised below.

Equity Investment Risk

The Company’s investments in listed and non-listed equity securities are accounted at cost in the financial statements net of impairment. The expected cash flows from these entities are regularly monitored internally and also independently, wherever necessary, to identify impairment indicators.

Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. In the case of the Company, market risk primarily impacts financial instruments measured at fair value through profit or loss. These are primarily unquoted Compulsorily Convertible Preference Shares of subsidiaries and investments in mutual funds, where investments are not significant in relation to the size of its total investments. The fair value investments of these investments are regularly monitored.

Credit Risk

Credit risk is the risk that the counterparty will not meet its obligations under a financial instrument or a customer contract, leading to a financial loss. The Company is exposed to credit risk from its financing activities towards inter-corporate deposits to subsidiaries where no significant impact on credit risk has been identified.

Liquidity Risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price. The Company’s corporate treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by the Senior Management.

The Company manages its liquidity requirement by analysing the maturity pattern of the Company''s cash flows of financial assets and financial liabilities. The Company invests its surplus funds in debt schemes of mutual funds, which carry low mark-to-market risks. Also refer Note No. 42 for maturity analysis of assets and liabilities.

The table below summarises the maturity profile of the undiscounted cash flows of the Company''s financial liabilities.

Under Aditya Birla Capital Limited Stock Appreciation Rights Scheme 2019, the Company has approved grant of Nil (Previous Year 59,856) Options SARs to the employees of the Company and its subsidiaries.

NOTE: 45

The Company, during the current year, has allotted 1,682,056 (Previous Year 1,034,008) Equity Shares of '' 10 each, fully paid-up, on exercise of options by eligible grantees, in accordance with the Employee Stock Options Schemes approved by the Company.

NOTE: 46

With effect from 11th October 2017, 64,422,405 Global Depositary Shares (GDSs) representing 64,422,405 Equity Shares of '' 10 each have been admitted for trading on the Luxembourg Stock Exchange.

As on 31st March 2023, 54,705,589 (GDS) representing 54,705,589 Equity Shares are outstanding (Previous Year 50,536,762).

NOTE: 47

The Company has made an assessment of its value of investments in Equity Shares and 0.001% Compulsory Convertible Cumulative Preference Shares ("CCPS") of Aditya Birla Capital Technology Services Limited (“ABCTSL”). Based on such assessments and independent valuation report, impairment loss on Equity Shares of '' 3.05 crore and fair value loss on CCPS of '' 12.56 crore have been provided in the previous year.

NOTE: 48

During the year, Aditya Birla Health Insurance Co. Limited (“ABHI”) has made a preferential allotment of 50,707,454 Equity Shares of '' 10 each to Platinum Jasmine A 2018 Trust, acting through its trustee, Platinum Owl C 2018 RSC Limited, being a wholly-owned subsidiary of Abu Dhabi Investment Authority ("ADIA"), on 21st October 2022 for an aggregate consideration of '' 664.27 crore. Pursuant to such issuance of the equity shares, ADIA owns 9.99% stake in ABHI. W.e.f. 21st October 2022, ABCL''s share holding in ABHI has reduced from 51% to 45.91%. Consequently, ABHI ceased to be a subsidiary and has been accounted as a joint venture.

NOTE: 49

Board of Directors of the Company, at its meeting held on 27th March 2023, has approved the sale of its entire stake of 50.002% of the issued and paid-up share capital of Aditya Birla Insurance Brokers Limited to Edme Services Private Limited, part of the Samara Capital Group and an affiliate of Samara Alternate Investment Fund. The Company has filed an application dated 20th April 2023 with Insurance Regulatory and Development Authority of India (“IRDAI”), seeking approval of the proposed transaction.

The Proposed Transaction is subject to receipt of the approval of Insurance Regulatory and Development Authority of India (“IRDAI”) and other regulatory/statutory approvals and satisfaction of other conditions under the Share Purchase Agreement. Upon completion of the Proposed Transaction, ABIBL shall cease to be a subsidiary of the Company.

NOTE: 50

The ABCAP Trustee Company Private Limited has been struck off from the Register of Companies, and stands dissolved w.e.f. 21st January 2023.

NOTE: 51

The Company has Long-Term Incentive Plan for selective employees. Long-Term Incentive Plan is payable to employees on fulfilment of criteria prescribed by the Company. On the basis of the plan, the Company has made provision of '' 4.61 crore (Previous Year '' 7 crore).

During the previous year, the Company has sold 2,850,880 Equity Shares of face value of '' 5 each of Aditya Birla Sun Life AMC Limited (ABSLAMC), at '' 712 per Equity Share by way of offer for sale in the Initial Public Offer (IPO) of ABSLAMC, in accordance with the relevant provisions of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, and recognised gain on sale of these investments amounting to '' 196.12 crore (Net of Tax, Gain is '' 179.47 crore). Consequently, w.e.f. 7th October 2021 ABSLAMC has ceased to be a Joint Venture and has been accounted as an Associate.

NOTE: 53

The Company has short-term rating, viz., “(ICRA) A1 ” and “(CRISIL) A1 ” (which is the highest short-term rating) and “AAA” long-term rating from ICRA (which is the highest long-term rating). During the year, the Company has not borrowed any funds.

NOTE: 54 INVESTMENT PROPERTY FAIR VALUE

The Company has carried out the valuation through an Independent Valuer to determine the fair value of its Investment Property. As per report provided by Independent Valuer, the fair value is '' 18.07 crore as on 31st March 2023 (Previous Year '' 19.02 crore).

The fair value of Investment Property has been derived using the Direct Comparison Method based on the recent market prices without any significant adjustments being made observable data. Accordingly, fair value estimates for Investment Property is classified as Level 3.

The Company has no restrictions on the realisability of its Investment Property, and has no contractual obligations to purchase, construct or develop Investment Property.

i) Maturity Pattern of Assets and Liabilities - (Refer Annexure 9)

j) Concentration of NPAs - (Refer Annexure 10)

k) Overseas assets (for those with Joint Ventures and Subsidiaries abroad) - (Refer Annexure 11)

l) Exposure to Real Estate Sector, both direct and indirect - (Refer Annexure 12)

m) Miscellaneous Disclosures - (Refer Annexure 13)

NOTE: 59

The Letter of Comfort and awareness issued for availing credit facilities by subsidiaries of '' 460 crore and '' 200 crore, respectively, with an explicit clause that it is not in the nature of financial guarantee.

NOTE: 60

Amount required to be spent by the Company on Corporate Social Responsibility (CSR) related activities during the year is '' Nil (Previous Year '' Nil), in accordance with the Companies Act, 2013.

NOTE: 61

No fund has been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entities (“Intermediaries”) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in parties identified by or on behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any parties (Funding Party) with the understanding that the Company shall whether, directly or indirectly, lend or invest in other persons or entities identified by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

NOTE: 62 SEGMENT REPORTING

The main business of the Company is Investment activities. Hence, there are no separate reportable segments as per Ind AS 108 on ‘Operating Segment’.

vi) Institutional Set-up for Liquidity Risk Management

The Board of Directors has the overall responsibility for establishing the risk management framework of the Company. The Board decides the liquidity risk tolerance/limits and, accordingly, lays down strategies, policies and procedures for the management of liquidity risk.

The Company has instituted a Risk Management Committee, which reports to the Boards’, and is responsible for evaluating the overall risks faced by the Company, including liquidity risk.

The Asset-Liability Committee (ALCO) of the Company, consisting of the Company’s Senior Management and Members of the Board, is responsible for ensuring adherence to the risk tolerance/limits as well as implementing the liquidity risk management strategy of the Company.

The Company has also constituted Asset-Liability Management (ALM) Support Group at the execution level, which is responsible for analysing, monitoring and reporting the liquidity risk profile to the ALCO.


Mar 31, 2022

a) Contingent Liabilities

The Company has issued Corporate Guarantees to National Housing Bank on behalf of its subsidiary Aditya Birla Housing Finance Limited (ABHFL) of '' 2,500 Crore up to 31st March 2022 (Previous Year '' 500 Crore). The Corporate Guarantees valid as on 31st March 2022 is '' 1541.76 Crore against which the amount liable by ABHFL is '' 1,498.73 Crore as on 31st March 2022 (Previous Year '' 225.93 Crore). As per the terms of the Guarantee, on invocation, the Company’s liability is capped at the outstanding amount.

b) Capital Commitments

i) The Company has '' Nil as commitments towards Property, Plant and Equipment as at 31st March 2022 (Previous Year '' 0.12 Crore).

ii) Pursuant to the Shareholders’ Agreement entered into with Sun Life Financial (India) Insurance Investments Inc. and its holding Company Sun Life Assurance Company of Canada by Aditya Birla Capital Limited, in respect of Aditya Birla Sun Life Insurance Company Limited (ABSLI), the Company agreed to infuse its share of capital in ABSLI from time to time to meet the solvency requirement prescribed by the regulatory authority.

Transfer of investments in ABSLI is restricted by the terms contained in Shareholders'' Agreements entered into by the Aditya Birla Capital Limited.

NOTE: 36 ABCL INCENTIVE PLAN 2017

The Scheme titled as “ABCL Incentive Scheme for Stock Options and Restricted Stock Units - 2017 (ABCL Incentive Scheme)” was approved by the shareholders through postal ballot on 10th April 2017. The Nomination, Remuneration and Compensation Committee of the Company at its meeting held on 15th January 2018, granted 1,465,927 ESOPs and 252,310 Restricted Stock Units (RSUs) (collectively called as "Stock Options”) to the eligible grantees, pursuant to the Composite Scheme of Arrangement between erstwhile Aditya Birla Nuvo Limited (now merged with Grasim Industries Limited), Grasim Industries Limited and Aditya Birla Capital Limited (Refer Note No. 33). The Stock Options allotted under the Scheme are convertible into equal number of Equity Shares.

NOTE: 39 FAIR VALUES

The Management assessed that the Fair Values of Financial Assets and Liabilities are approximately their carrying values.

NOTE: 40 FINANCIAL INSTRUMENTS - ACCOUNTING CLASSIFICATIONS AND FAIR VALUE MEASUREMENTS

The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

Principles for Estimating Fair Value

The following summarises the major methods and assumptions used in estimating the fair values of financial instruments reflected in the table.

Fair Value Hierarchy

The table below analyses financial instruments carried at fair value, by valuation method at 31st March 2022. The different levels have been defined as follows:

Level 1: Category includes financial assets and liabilities that are measured in whole or in significant part by reference to published quotes in an active market.

Level 2: Category includes financial assets and liabilities measured using a valuation technique based on assumptions that are supported by prices from observable current market transactions. These include assets and liabilities for which pricing is obtained via pricing services, but where prices have not been determined in an active market, financial assets with fair values based on broker quotes and assets that are valued using the Company''s own valuation models, whereby the material assumptions are market observable.

Level 3: Category includes financial assets and liabilities measured using valuation techniques based on non-market observable inputs. This means that fair values are determined in whole or in part using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data. However, the fair value measurement objective remains the same, that is, to estimate an exit price from the perspective of the Company. The main asset classes in this category are unlisted equity investments as well as unlisted funds.

The carrying amount of trade receivables, trade payables, other financial liabilities, loans, other financial assets, cash and cash equivalents as at 31st March 2022 and 31st March 2021, are considered to the same as fair values, due to their short-term nature. These are classified as Level 3 fair value hierarchy due to inclusion of unobservable inputs including counterparty credit risk.

During the reporting period ending 31st March 2022, there were no transfers between Level 1 and Level 2 fair value measurements.

Assumptions to above:

* The Fair Valuation of Preference Shares is based on independent valuers report.

* The Fair Valuation of Unquoted Mutual Funds’ Units is done based on NAV of units.

NOTE: 41 FINANCIAL RISK MANAGEMENT

The Company, being a Core Investment Company as per the Core Investment Companies (RBI) Directions, 2016, is required to invest or lend majority of its funds to its Subsidiaries and Joint Ventures. The Company’s principal financial liabilities comprise trade and other payables. The main purpose of these financial liabilities is to support the Company’s operations. The Company’s principal financial assets include investments, inter-corporate deposits, loans, cash and cash equivalents, and other receivables.

The Company is exposed to certain financial risks, such as market risk, credit risk, liquidity risk and equity investment risk. The Company’s Senior Management oversees the management of these risks. The Company’s Senior Management is supported by a Risk Management Committee that advises on financial risks and the appropriate financial risk governance framework for the Company. The Risk Management Committee provides assurance to the Company’s Senior Management that the Company’s financial risk activities are governed by appropriate policies and procedures, and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives. The major risks are summarised below:

Equity Investment Risk

The Company’s investments in listed and non-listed equity securities are accounted at cost in the financial statements net of impairment. The expected cash flows from these entities are regularly monitored internally and also independently, wherever necessary, to identify impairment indicators.

Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. In the case of the Company, market risk primarily impacts financial instruments measured at fair value through profit or loss. These are primarily unquoted Compulsorily Convertible Preference Shares of subsidiaries and investments in mutual funds, and other alternate funds where investments are not significant in relation to the size of its total investments. The fair value investments of these investments are regularly monitored.

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company does not have exposure to the risk of changes in market interest rate as it has no borrowings.

Credit Risk

Credit risk is the risk that the counterparty will not meet its obligations under a financial instrument or a customer contract, leading to a financial loss. The Company is exposed to credit risk from its financing activities towards inter-corporate deposits to subsidiaries where no significant impact on credit risk has been identified.

Liquidity Risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price. The Company’s corporate treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by the Senior Management.

The Company manages its liquidity requirement by analysing the maturity pattern of the Company''s cash flows of financial assets and financial liabilities. The Company invests its surplus funds in debt schemes of mutual funds, which carry low mark-to-market risks. Also refer Note No. 42 for maturity analysis of assets and liabilities.

NOTE: 43 IMPAIRMENT ON FINANCIAL INSTRUMENTSBackground of Expected Credit Loss

Expected Credit Loss is a calculation of the present value of the amount expected to be lost on a financial asset, for financial reporting purposes. Credit risk is the potential that the obligor and counterparty will fail to meet its financial obligations to the lender. This requires an effective assessment and management of the credit risk at both individual and portfolio level.

The key components of Credit Risk Assessment are:

1. Probability of Default (PD): represents the likelihood of default over a defined time horizon.

2. Exposure at Default (EAD): represents how much the obligor is likely to be borrowing at the time of default.

3. Loss Given Default (LGD): represents the proportion of EAD that is likely to be lost post-default.

The definition of default is taken as 90 days past due for all retail and corporate loans.

Delinquency buckets have been considered as the basis for the staging of all loans in the following manner:

0-30 days past due loans classified as Stage 1;

More than 30-90 days past due loans classified as Stage 2;

Above 90 days past due loans classified as Stage 3.

The ECL is computed as a product of PD, LGD and EAD.

NOTE: 44 DETAILS OF DUES TO MICRO, SMALL AND MEDIUM ENTERPRISES AS PER MSMED ACT, 2006

Based on the information received by the Company from “suppliers”, regarding their status under the Micro, Small and Medium

Enterprises Development Act, 2006, there are no amounts due to any suppliers covered under this Act as at the Balance Sheet

Date and, hence, disclosures relating to amounts unpaid as at the year end together with interest paid/payable as required

under the said Act have not been given.

NOTE: 45 Under Aditya Birla Capital Limited Stock Appreciation Rights Scheme 2019, the Company has approved grant of Nil (Previous Year 4,356) RSU Stock Appreciation Rights (SARs) and 59,856 (Previous Year 83,592) Options SARs to the employees of the Company and its subsidiaries.

NOTE: 46 The Company, during the current year, has allotted 1,034,008 (Previous Year 1,517,270) Equity Shares of '' 10 each, fully paid-up, on exercise of options by eligible grantees, in accordance with the Employee Stock Options Schemes approved by the Company.

NOTE: 47 With effect from 11th October 2017, 64,422,405 Global Depositary Shares (GDSs) representing 64,422,405 Equity Shares of '' 10 each have been admitted for trading on the Luxembourg Stock Exchange.

As on 31st March 2022, 50,536,762 (GDS) representing 50,536,762 Equity Shares are outstanding (Previous Year 50,536,762).

NOTE: 48 The Company has made an assessment of its value of investments in Equity Shares and 0.001% Compulsory Convertible Cumulative Preference Shares ("CCPS") of Aditya Birla Capital Technology Services Limited (“ABCTSL”). Based on such assessments and independent valuation report, value of Equity Shares and CCPS is assessed at '' 3.22 Crore and '' 2.42 Crore, respectively, and accordingly additional impairment loss on Equity Shares of '' 3.05 Crore and fair value loss on CCPS of '' 12.56 Crore have been provided.

The ABCAP Trustee Company Private Limited is under process of strike off, and accordingly impairment loss on Equity Shares of '' 0.05 Crore has been provided.

NOTE: 49 The Company has sold 2,850,880 Equity Shares of face value of '' 5 each, of Aditya Birla Sun Life AMC Limited (ABSLAMC), at '' 712 per Equity Share by way of offer for sale in the Initial Public Offer (IPO) of ABSLAMC in accordance with the relevant provisions of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, and recognised gain on sale of these investments amounting to '' 196.12 Crore (Net of Tax, Gain is '' 179.47 Crore). Consequently, w.e.f. 7th October 2021, ABSLAMC has ceased to be a Joint Venture and has been accounted as an Associate.

NOTE: 50 During the year, the Company received '' 57.75 Crore for redemption of 0.01% Redeemable Non-Convertible Cumulative Preference Shares ("RNCCPS") of Aditya Birla Money Limited as per agreed terms.

NOTE: 51 The Company has Long-Term Incentive Plan for selective employees. Long-Term Incentive Plan includes future encashment or availment, at the option of the employee and subject to the rules framed by the Company, which are expected to be availed or encashed beyond 12 months from the end of the year, and long-term incentive payable to employees on fulfilment of criteria prescribed by the Company. On the basis of the plan, the Company has made provision of '' 7 Crore (Previous Year '' 18 Crore).

NOTE: 52 The Company has short-term rating, viz, “(ICRA) A1 ”, “(CRISIL) A1 ” and “AAA” long-term rating from ICRA (which is the highest long-term rating) and, therefore, high acceptability in the market. During the year, the Company has not borrowed any funds.

NOTE: 53 INVESTMENT PROPERTY FAIR VALUE

The Company has carried out the valuation through an Independent Valuer to determine the fair value of its Investment Properties. As per report provided by the Independent Valuer, the fair value is '' 19.02 Crore as on 31st March 2022 (Previous Year '' 16.65 Crore).

The fair value of Investment Property has been derived using the Direct Comparison Method based on the recent market prices without any significant adjustments being made observable data. Accordingly, fair value estimates for Investment Property is classified as Level 3.

The Company has no restrictions on the realisability of its Investment Property and has no contractual obligations to purchase, construct or develop Investment Property.

Information regarding Income and Expenditure of Investment Property

NOTE: 55 The Company has a process whereby periodically all long-term contracts are assessed for material foreseeable losses. At the year end, the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses need to be provided as required under any law/accounting standards.

NOTE: 58 The Letter of Comfort and awareness issued for availing credit facilities by subsidiaries of '' 310 Crore and '' 200 Crore, respectively, with an explicit clause that it is not in the nature of financial guarantee.

NOTE: 59 Amount required to be spent by the Company on Corporate Social Responsibility (CSR) related activities during the year is '' Nil (Previous Year '' Nil) in accordance with Companies Act, 2013.

NOTE: 60 No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entities (“Intermediaries”) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in parties identified by or on behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any parties (Funding Party) with the understanding that the Company shall whether, directly or indirectly, lend or invest in other persons or entities identified by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

NOTE: 61 SEGMENT REPORTING

The main business of the Company is Investment activity, hence, there are no separate reportable segments as per Ind AS 108 on ‘Operating Segment’.


Mar 31, 2021

a) Contingent Liabilities

The Company has issued Corporate Guarantees to National Housing Bank on behalf of its subsidiary Aditya Birla Housing Finance Limited (ABHFL) of '' 500 Crore against which the amount liable by ABHFL is '' 225.93 Crore as on 31st March 2021 (Previous Year '' 303.05 Crore). As per the terms of the Guarantee, on invocation, the Company’s liability is capped at the outstanding amount.

b) Capital Commitments

i) The Company has '' 0.12 Crore as at 31st March 2021 (Previous Year '' NIL), as commitments towards Property, Plant and Equipment.

ii) Pursuant to the Shareholders’ Agreement entered into with Sun Life Financial (India) Insurance Investments Inc. and its holding company Sun Life Assurance Company of Canada by Aditya Birla Capital Limited, in respect of Aditya Birla Sun Life Insurance Company Limited (ABSLI), the Company agreed to infuse share of capital in ABSLI from time to time to meet the solvency requirement prescribed by the regulatory authority.

Transfer of investments in Aditya Birla Sun Life Insurance Company Limited is restricted by the terms contained in Shareholders'' Agreements entered into by the Aditya Birla Capital Limited.

NOTE: 31 LEASES

During the previous year, the Company adopted Ind AS 116 “Leases” and applied the standard to all lease contracts existing on 1st April 2019, using the modified retrospective method and has taken the cumulative adjustment to retained earnings, on the date of initial application. Consequently, the Company recorded the lease liability at the present value of the lease payments discounted at the incremental borrowing rate and the right-of-use-asset at its carrying amount, as if the standard had been applied since the commencement date of the lease, but discounted at the lessee’s incremental borrowing rate at the date of initial application.

The following is the summary of practical expedients elected on initial application:

1. Applied a single discount rate to a portfolio of leases of similar assets in similar economic environment with a similar end date.

2. Applied the practical expedient to grandfather the assessment of which transactions are leases. Accordingly, for all contracts as on 1st April 2019, Ind AS 116 is applied only to contracts that were previously identified as leases under Ind AS 17.

The weighted-average incremental borrowing rate applied to lease liabilities as at 1st April 2019, is 8.26%.

Critical accounting judgements and key sources of estimation uncertainty

Critical judgements required in the application of Ind AS 116 may include, among others, the following:

• Identifying whether a contract (or part of a contract) includes a lease;

• Determining whether it is reasonably certain that an extension or termination option will be exercised;

• Classification of lease agreements (when the entity is a lessor);

• Determination of whether variable payments are in-substance fixed;

• Establishing whether there are multiple leases in an arrangement; and

• Determining the stand-alone selling prices of lease and non-lease components.

Key sources of estimation uncertainty in the application of Ind AS 116 may include, among others, the following:

• Estimation of the lease term;

• Determination of the appropriate rate to discount the lease payments; and

• Assessment of whether a right-of-use asset is impaired.

The Scheme titled as “ABCL Incentive Scheme for Stock Options and Restricted Stock Units - 2017 (ABCL Incentive Scheme)” was approved by the shareholders through postal ballot on 10th April 2017. The Nomination, Remuneration and Compensation Committee of the Company at its meeting, held on 15th January 2018, granted 1,465,927 ESOPs and 252,310 Restricted Stock Units (RSUs) (collectively called as "Stock Options”) to the eligible grantees pursuant to the Composite Scheme of Arrangement between erstwhile Aditya Birla Nuvo Limited (now merged with Grasim Industries Limited), Grasim Industries Limited and Aditya Birla Capital Limited (Refer Note No. 33). Out of the above, the Company has granted 195,040 ESOPs and 45,060 RSUs under this Scheme to a Director of the Company. The Stock Options allotted under the Scheme are convertible into equal number of Equity Shares.

The vesting conditions and the vesting dates under the ABCL Incentive Scheme shall follow the same vesting conditions, as applicable to the Grantees under the corresponding Grasim Employee Benefit Schemes 2006 and 2013.

iii) Funding Arrangement and Policies

The money contributed by the Company to the fund to finance the liabilities of the plan has to be invested.

The trustees of the plan are required to invest the funds as per the prescribed pattern of investments laid out in the income tax rules for such approved schemes. Due to the restrictions in the type of investments that can be held by the fund, it is not possible to explicitly follow an asset-liability matching strategy to manage risk actively.

Estimated amount of contribution expected to be paid to the fund during the annual period being after the Balance Sheet date is '' 1.29 Crore (Previous Year '' 3.57 Crore).

Principles for Estimating Fair Value

The following summarises the major methods and assumptions used in estimating the fair values of financial instruments reflected in the table.

Fair Value Hierarchy

The table below analyses financial instruments carried at fair value, by valuation method at 31st March 2021. The different levels have been defined as follows:

Level 1: Category includes financial assets and liabilities that are measured in whole or in significant part by reference to published quotes in an active market.

Level 2: Category includes financial assets and liabilities measured using a valuation technique based on assumptions that are supported by prices from observable current market transactions. These include assets and liabilities for which pricing is obtained via pricing services, but where prices have not been determined in an active market, financial assets with fair values based on broker quotes and assets that are valued using the Company''s own valuation models whereby the material assumptions are market observable. The majority of the Company’s over-the-counter derivatives and several other instruments not traded in active markets fall within this category.

Level 3: Category includes financial assets and liabilities measured using valuation techniques based on non-market observable inputs. This means that fair values are determined in whole or in part using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument

The Company, being a Core Investment Company as per the Core Investment Companies (RBI) Directions 2016, is required to invest or lend majority of its funds to its Subsidiaries and Joint Ventures. The Company’s principal financial liabilities comprise borrowings, and trade and other payables. The main purpose of these financial liabilities is to finance and support the Company’s operations. The Company’s principal financial assets include inter-corporate deposits, loans, cash and cash equivalents, and other receivables.

The Company is exposed to certain financial risks, such as market risk, credit risk, liquidity risk and equity investment risk. The Company’s senior management oversees the management of these risks. The Company’s senior management is supported by a Risk Management Committee that advises on financial risks and the appropriate financial risk governance framework for the Company. The Risk Committee provides assurance to the Company’s senior management that the Company’s financial risk activities are governed by appropriate policies and procedures, and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives. The major risks are summarised below:

Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. In the case of the Company, market risk primarily impacts financial instruments measured at fair value through profit or loss. These are primarily unquoted Compulsorily Convertible Preference Shares of subsidiaries, and investments in mutual funds and other alternate funds where investments are not significant in relation to the size of its total investments. The fair value investments of these investments are regularly monitored.

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company does not have exposure to the risk of changes in market interest rate as it has debt obligations with fixed interest rates, which are measured at amortised cost.

Credit Risk

Credit risk is the risk that the counterparty will not meet its obligations under a financial instrument or a customer contract, leading to a financial loss. The Company is exposed to credit risk from its financing activities towards inter-corporate deposits to subsidiaries where no significant impact on credit risk has been identified.

Equity Investment Risk

The Company’s investments in listed and non-listed equity securities are accounted at cost in the financial statements net of impairment. The expected cash flows from these entities are regularly monitored internally and also independently, wherever necessary, to identify impairment indicators.

Liquidity Risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price. The Company’s corporate treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by the senior management.

The Company manages its liquidity requirement by analysing the maturity pattern of the Company''s cash flows of financial assets and financial liabilities. The Company’s objective is to maintain a balance between continuity of funding and flexibility through issuance of equity shares, commercial papers, etc. The Company invests its surplus funds in debt schemes of mutual funds, which carry low mark-to-market risks. Also Refer Note No. 40 for maturity analysis of assets and liabilities.

The table below summarises the maturity profile of the undiscounted cash flows of the Company''s financial liabilities.

Background of Expected Credit Loss

Expected credit loss is a calculation of the present value of the amount expected to be lost on a financial asset, for financial reporting purposes. Credit risk is the potential that the obligor and counterparty will fail to meet its financial obligations to the lender. This requires an effective assessment and management of the credit risk, at both individual and portfolio level.

The key components of Credit Risk Assessment are:

1. Probability of Default (PD): represents the likelihood of default over a defined time horizon.

2. Exposure at Default (EAD): represents how much the obligor is likely to be borrowing at the time of default.

3. Loss Given Default (LGD): represents the proportion of EAD that is likely to be lost post-default.

The definition of default is taken as 90 days past due for all retail and corporate loans.

Delinquency buckets have been considered as the basis for the staging of all loans in the following manner:

• 0-30 days past due loans classified as Stage 1;

• More than 30 - 90 days past due loans classified as Stage 2; and

• Above 90 days past due loans classified as Stage 3.

EAD is the total amount outstanding including accrued interest as on the reporting date.

The ECL is computed as a product of PD, LGD and EAD.

Non-Individual Loans 1.1 Credit Quality of Assets

The non-individual/corporate book is assessed at the loan type level and the provisioning is done at an account level. In certain cases, the assessment is done at an account level based on past experience for future cash flows from the project.

The 12-month PD has been applied on Stage 1 loans. The PD term structure, i.e., Lifetime PD has been applied on Stage 2 loans according to the repayment schedule for Stage 2 loans, and PD is considered to be 1 for Stage 3 loans.

DETAILS OF DUES TO MICRO, SMALL AND MEDIUM ENTERPRISES AS PER MSMED ACT, 2006

Based on the information received by the Company from “suppliers” regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006, there are no amounts due to any suppliers covered under this Act as at the Balance Sheet Date and, hence, disclosures relating to amounts unpaid as at the year end together with interest paid/payable as required under the said Act have not been given. Auditors have relied on this.

The Company has approved the grant of 24,062,864 Employee Stock Options (ESOPs) and 5,742,636 Restricted Stock Units (RSUs) in accordance with the Employee Stock Options Scheme, 2017, to its employees and employees of subsidiary companies.

Further, in continuation to the existing Scheme, the Company additionally grant NIL (Previous Year 2,107,868) RSUs and ESOPs NIL (Previous Year 531,496) to the employees of subsidiary companies.

Further, pursuant to ABCL Incentive Scheme and ABCL ESOP 2017, the Company has approved Re-grant of 25,585 Stock options (ESOPs) and 250,863 Stock options (ESOPs), respectively.

During the year, under Aditya Birla Capital Limited Stock Appreciation Rights Scheme 2019, the Company has approved grant of 4,356 RSU Stock Appreciation Rights (SARs) and 83,592 Options SARs to the employees of the Company and its subsidiaries.

The Company, during the current year, has allotted 1,517,270 (Previous Year 2,356,345) Equity Shares of '' 10 each, fully paid-up, on exercise of options by eligible grantees, in accordance with the Employee Stock Options Schemes approved by the Company.

During the previous year, the Company has issued and allotted 210,000,000 Equity Shares of '' 10 each at a premium of '' 90 per Share on preferential basis, which were subscribed by Jomei Investments Limited, promoter Grasim Industries Limited, members of the promoter group and PI Opportunities Fund-I.

With effect from 11th October 2017, 64,422,405 Global Depositary Shares (GDSs) representing 64,422,405 Equity Shares of '' 10 each have been admitted for trading on the Luxembourg Stock Exchange.

As on 31st March 2021, 50,536,762 (GDS) representing 50,536,762 Equity Shares are outstanding (Previous Year 50,557,062).

SCHEME OF ARRANGEMENT BETWEEN SUBSIDIARY COMPANIES

During the previous year, the Hon’ble National Company Law Tribunal (NCLT) has approved the Scheme, vide order dated 13th December 2019, and upon filing of the Scheme with Registrar of Companies, whereby the transaction business of Aditya Birla Technology Services Limited (Formerly known as Aditya Birla MyUniverse

Limited ("ABMU")), a subsidiary of the Company, was demerged and transferred to Aditya Birla Finance Limited (ABFL), also a subsidiary of the Company. The Scheme of Arrangement was made effective on 1st January 2020.

In consideration of the demerger,

The Company has received 5,855,625 Equity Shares of '' 10 each of ABFL as per the share entitlement ratio determined based on an independent valuation report at 24 Equity Shares of '' 10 each in ABFL for every 215 Equity Shares of '' 10 each held in ABMU and 43 Equity Shares of '' 10 each in ABFL for every 105 (0.001% Compulsorily Convertible Preference Shares) of '' 10 each held in ABMU.

Further, out of the Inter-Corporate Deposits (ICD) receivable as on 1st January 2020, of '' 100.51 Crore from ABMU, '' 87.54 Crore has been transferred to ABFL (in proportion to the value of assets transferred by ABMU to ABFL) and balance '' 12.97 Crore is shown as receivable from ABMU.

The carrying value of the investments in ABMU '' 149.02 Crore (net of impairment of '' 21.01 Crore) is considered to be at fair value of asset given up for Equity Shares received from ABFL.

The Company has made an assessment of its value of investments in Equity Shares and 0.001% Compulsory Convertible Cumulative Preference Shares ("CCPS") of Aditya Birla Capital Technology Services Limited (Formerly known as Aditya Birla MyUniverse Limited) (“ABCTSL”) of '' 6.27 Crore (net of impairment of '' 3.00 Crore) (Previous Year '' 6.27 Crore (net of impairment of '' 3.00 Crore)) and '' 14.98 Crore (Previous Year '' 14.98 Crore), respectively. Based on such assessments, the Board approved business plan and independent valuation report, no additional impairment loss needs to provide.

During the year, the Company has made an assessment of its value of investments in Aditya Birla Money Limited. Based on such assessments, the Board approved business plan and independent valuation report, no additional impairment loss needs to provide.

During the previous year, the Company has made a provision as impairment loss of '' 29.17 Crore. An amount of '' 41.59 Crore (Previous Year '' 41.59 Crore) as on 31st March 2021.

During the year, basis the agreed terms, the Company''s investment in 0.1% Compulsory Convertible Debentures ("CCD") of Aditya Birla Money Mart Limited (“ABMML”) got converted into 0.1% Redeemable Non-Convertible Non-Cumulative Preference Shares ("RNCNCPS"), i.e., each CCD converted into 1 (one) RNCNCPS of '' 100 each at a premium of '' 54 per RNCNCPS. The value post-conversion of RNCNCPS is '' 40.10 Crore (Previous Year (CCD) '' 36.79 Crore).

During the year, the Company received '' 0.15 Crore for redemption of 0.01% Redeemable Non-Convertible Cumulative Preference Shares ("RNCCPS") of Aditya Birla Money Mart Limited as per agreed terms, 100,000 RNCCPS at '' 15 per Share (Face Value '' 10/- per Share and '' 5 premium per Share).

During the year, the 0.1% Compulsory Convertible Debentures ("CCD") of Aditya Birla Finance Limited ("ABFL'') got converted into Equal No. of 0.1% Non-Convertible Debenture ("NCD") and redeemed on 20th March 2021, accordingly, the Company received an amount of '' 36.95 Crore as redemption proceed.

The Company has Long-Term Incentive Plan for selective employees. Long-Term Incentive Plan includes future encashment or availment, at the option of the employee, subject to the rules framed by the Company, which are expected to be availed or encashed beyond 12 months from the end of the year, and long-term incentive payable to employees on fulfilment of criteria prescribed by the Company. On the basis of the scheme, the Company has made provision of '' 18 Crore (Previous Year '' 16 Crore).

The Company has short-term rating, viz., “(ICRA) A1 ” and “(CRISIL) A1 ” and “AAA” long-term rating from ICRA (which is the highest long-term rating) and, therefore, high acceptability in the market. During the year, the Company has not borrowed any funds.

INVESTMENT PROPERTIES FAIR VALUE

The Company has carried out the valuation activity through the Independent Valuer to assess fair value of its Investment Properties. As per the report provided by Independent Valuer the fair value is '' 16.65 Crore as on 31st March 2021 (Previous Year valuation was not carried out due to COVID-19 and lockdown situation).

The fair value of Investment Properties has been derived using the Direct Comparison Method based on recent market prices without any significant adjustments being made observable data. Accordingly, fair value estimates for Investment Properties is classified as Level 3.

The Company has no restrictions on the realisability of its Investment Properties, and has no contractual obligations to purchase, construct or develop Investment Properties.

The Company has reviewed all litigations and proceedings, and has adequately provided for where provisions are required and disclosed the contingent liabilities, where applicable, in its financial statements. The Company does not expect the outcome of these proceedings to have a materially adverse effect on its financial statements and appropriate disclosure for contingent liabilities is given, Refer Note No. 30.

INCOME TAX DISCLOSURE

The Major Components of Income Tax Expenses for the years ended 31st March 2021 and 31st March 2020 are:

The Company has a process whereby periodically all long-term contracts are assessed for material foreseeable losses. At the year end, the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses need to be provided as required under any law/accounting standards.

DISCLOSURE AS REQUIRED UNDER ANNEXURE II AND ANNEXURE V OF MASTER DIRECTION-CORE INVESTMENT COMPANIES (RESERVE BANK), DIRECTION, 2016

Annexure II - Schedule to the Balance Sheet of a non-deposit taking Core Investment Company - (Refer Annexure 2).

Annexure V

a) Group entities that are not consolidated in the CFS - All the entities required by Ind AS are consolidated in ABCL Consolidated Financials as on 31st March 2021 and 31st March 2020

b) Investment in other CICs - Nil as on 31st March 2021

c) Provisions as per CIC guidelines and others - (Refer Annexure 3)

d) Components of Adjusted Net Worth ("ANW") and other related information - (Refer Annexure 4)

e) Off Balance Sheet Exposure - (Refer Annexure 5)

f) Investments - (Refer Annexure 6)

g) Business Ratios - (Refer Annexure 7)

h) Public Disclosure on Liquidity Risk - (Refer Annexure 8)

i) Maturity Pattern of Assets and Liabilities - (Refer Annexure 9)

j) Concentration of NPAs - (Refer Annexure 10)

k) Overseas Assets (for those with Joint Ventures and Subsidiaries abroad) - (Refer Annexure 11)

l) Exposure to Real Estate Sector, both direct and indirect - (Refer Annexure 12)

m) Miscellaneous Disclosures - (Refer Annexure 13)

The Company has executed the Corporate Guarantee to National Housing Bank on behalf of its subsidiary Aditya Birla Housing Finance Limited (ABHFL) of '' 2,000 Crore, dated 9th April 2021, which is an addition to earlier Corporate Guarantee issued of '' 500 Crore (Refer Note No 30 (a)).

The Letter of Comfort and awareness issued for availing credit facilities by subsidiaries of '' 310 Crore and '' 200 Crore, respectively, with an explicit clause that it is not in nature of financial guarantee.

ESTIMATION UNCERTAINTY RELATING TO THE GLOBAL HEALTH PANDEMIC ON COVID-19

The Management has assessed the potential impact of the COVID-19 on the financial statements of the Company. In assessing the carrying value of its assets, the Company has considered internal and certain external information up to the date of approval of these financial statements including economic forecasts. The Company expects to recover the carrying amount of these assets. The Company will keep monitoring any future material changes due to the global health pandemic in estimates as at the date of approval of these financial statements.

SEGMENT REPORTING

The main business of the Company is Investment Activities, hence, there are no separate reportable segments as per Ind AS 108 on ‘Operating Segment’.

vi) Institutional set-up for liquidity risk management

The Board of Directors has the overall responsibility for establishing the risk management framework of the Company. The Board decides the liquidity risk tolerance/limits, and accordingly lays down strategies, policies and procedures for the management of liquidity risk.

The Company has instituted a Risk Management Committee, which reports to the Board, and is responsible for evaluating the overall risks faced by the Company, including liquidity risk.

The Asset-Liability Committee (ALCO) of the Company, consisting of the Company’s senior management and Members of the Board, is responsible for ensuring adherence to the risk tolerance/limits as well as implementing the liquidity risk management strategy of the Company.

The Company has also constituted Asset-Liability Management (ALM) Support Group at the execution level, which is responsible for analysing, monitoring and reporting the liquidity risk profile to the ALCO.


Mar 31, 2019

Note:

1. Aggregate Amount of Quoted Investment Rs,235.88 Crore (31st March, 2018 Rs,235.88 Crore and 1st April, 2017 Rs,235.88 Crore) Market Value of Rs,195.91 Crore (31st March, 2018 Rs,208.58 Crore and 1st April, 2017 Rs,131.09 Crore).

2. Aggregate Book Value of Unquoted Investment '' 8,473.30 Crore (31st March, 2018 '' 7,687.24 Crore; 1st April, 2017 '' 4,906.34 Crore).

3. Aggregate Amount of Diminution in Value of Investment Rs,36.65 Crore (31st March, 2018 Rs,12.64 Crore; 1st April, 2017 Rs,12.64 Crore).

4. All above investments are in India itself.

2. Term/Right Attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs,10 per share. Each holder of equity shares is entitled to one vote per share.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of the equity shares held by the shareholders.

* During the previous year Pursuant to the Composite Scheme of Arrangement (the “Scheme”) amongst the erstwhile Aditya Birla Nuvo Limited (ABNL), Grasim Industries Limited (Grasim) and the Company 920,266,951 equity shares of Rs,10 each were issued to Grasim as fully paid up in exchange of the assets of the Financial Services Business.

4. Reclassification of Authorized Share Capital

During the previous year the Company had reclassified its Authorized Share Capital. The revised structure comprise of 4,000,000,000 Equity shares of Rs,10 each.

5. During the last five years there were no Bonus Shares were issued.

6. The shares reserved for issue under Employee Stock Option Plan (ESOP) of the Company (Refer Note No. 33 & 34).

29 Deferred Tax Liabilities/Assets

The Company has not recognized deferred tax assets on brought forward business losses, capital losses, unabsorbed depreciation and other deductible timing differences (net of future taxable capital gains) aggregating to '' 43.75 Crore (Rs,28.78 Crore as at 31st March, 2018; '' NIL as at 1st April, 2017) since there is no certainty that future taxable profits against which such losses can be utilized would be available.

A Deferred tax liability on mark to mark gain on investment in private equity funds of Rs,14 Crore as at 1st April, 2017 has not been recognized since the investments made by the private equity fund are diversified in short-term and long-term investments. These investments will carry different rates of income tax/exemptions at the time of exits.

30 Contingent Liabilities and Commitments

a) Contingent Liabilities

Aditya Birla MyUniverse Limited (formerly known as Aditya Birla Customer Services Limited) (ABMU), a subsidiary of the Company, has issued 0.001%-Compulsorily Convertible Preference Shares (CCPS) aggregating to Rs,60 Crore to International Finance Corporation (IFC) vide Shareholders'' Agreement, dated 19th December, 2014, and Subscription Agreement dated 19th December, 2014 (SHA). Under the said SHA, the Company has granted to IFC an option to sell the shares to the Company at fair valuation from the period beginning on the expiry of 60 months of the subscription by IFC up to a maximum of 120 months from the date of subscription by IFC, in the event ABMU fails to provide an opportunity to IFC to exit from ABMU within 60 months from the date of subscription by IFC in the form of Listing, secondary sale or acquisition, etc. In the event ABMU fails to fulfill its obligation, the Company will be obligated to fulfill this obligation.

b) Capital Commitments

i) There is no capital commitment ('' Nil as at 31st March, 2018; Rs,1.02 Crore as at 1st April, 2017) towards Intangible Assets under Development for Digital/Technology related projects.

ii) The Company has Rs,2.00 Crore commitments towards Equity Participation in any new formed Subsidiary Aditya Birla Capital Investments Private Limited.

The Company has '' NIL as at 31st March, 2018 as commitments towards Equity Participation and

The Company has Rs,2.00 Crore as at 1st April, 2017 as commitments towards Equity Participation in Aditya Birla ARC Limited.

iii) Pursuant to the Shareholders'' Agreement entered into with Sun Life of Canada by Aditya Birla Capital Limited, in respect of Aditya Birla Sun Life Insurance Company Limited, the Company agreed to infuse its share of capital from time to time to meet the solvency requirement prescribed by the regulatory authority.

Transfer of investments in Aditya Birla Sun Life Insurance Company Ltd., is restricted by the terms contained in Shareholder Agreements entered into by the Company.

31 Leases

The Company has entered into operating lease related to office premises and employee housing accommodation facility provided. The security deposits has been recognized at fair value as per Ind AS 109, at initial recognition the carrying value of the rent deposit is the present value of all expected future principal repayments discounted using market rates prevailing at the time of origination.

34 ABCL Incentive Plan 2017

The Scheme titled as “ABCL Incentive Scheme for Stock Options and Restricted Stock Units - 2017 (ABCL Incentive Scheme)” was approved by the shareholders through postal ballot on 10th April, 2017. The Nomination, Remuneration and Compensation Committee of the Company at their meeting held on 15th January, 2018, granted 1,465,927 ESOPs and 252,310 Restricted Stock Units (RSUs) (Collectively called as “Stock Options”) to the eligible grantees pursuant to the Composite Scheme of Arrangement between erstwhile Aditya Birla Nuvo Limited (now merged with Grasim Industries Limited), Grasim Industries Limited and Aditya Birla Capital Limited (formerly known as Aditya Birla Financial Services Limited). Out of the above, the Company; has granted 195,040 ESOPs and 45,060 RSUs under this Scheme to a Director of the Company. The Stock Options allotted under the Scheme are convertible into equal number of Equity Shares.

The vesting conditions and the vesting dates under the ABCL Incentive Scheme shall follow the same vesting conditions, as applicable to the Grantees under the corresponding Grasim Employee Benefit Scheme 2006 and 2013

35 Related Party Disclosures

Names of related parties where control exists

Holding Company

Grasim Industries Limited (Aditya Birla Nuvo Limited till 30th June, 2017)

Subsidiaries

Aditya Birla PE Advisors Private Limited (Formerly known as Aditya Birla Capital Advisors Private Limited)

Aditya Birla Capital Investments Private Limited (w.e.f. 12th October, 2018)

Aditya Birla MyUniverse Limited (Formerly known as Aditya Birla Customer Services Limited)

Aditya Birla Financial Shared Services Limited

Aditya Birla Trustee Company Private Limited

Aditya Birla Money Limited

Aditya Birla Money Mart Limited

Aditya Birla Insurance Brokers Limited

Aditya Birla Finance Limited

Aditya Birla Housing Finance Limited

Aditya Birla Health Insurance Co. Limited

ABCAP Trustee Company Private Limited

Aditya Birla Stressed Asset AMC Private Limited

Aditya Birla Commodities Broking Limited (Merge to Aditya Birla Money Limited w.e.f. 1st April, 2018)

Aditya Birla Money Insurance Advisory Services Limited (100% Subsidiary of Aditya Birla Money Mart Limited)

Aditya Birla Sun Life Insurance Company Limited (w.e.f. 23rd March, 2017) (Formerly known as Birla Sun Life Insurance Company imited) Aditya Birla Sun Life Pension Management Limited (100% Subsidiary of Birla Sun Life Insurance Company Limited- w.e.f. 23rd March, 2017) Aditya Birla ARC Limited (w.e.f. 10th March, 2017)

Joint Ventures

Aditya Birla Sun Life AMC Limited (Formerly known as Birla Sun Life Asset Management Company Limited)

Aditya Birla Sun Life AMC (Mauritius) Limited (100% Subsidiary of Aditya Birla Sun Life AMC Limited)

Aditya Birla Sun Life Asset Management Company Limited; Dubai (100% Subsidiary of Aditya Birla Sun Life AMC Limited)

Aditya Birla Sun Life Asset Management Company Pte. Limited; Singapore (100% Subsidiary of Aditya Birla Sun Life AMC Limited)

Aditya Birla Sun Life Trustee Private Limited (Formerly known as Birla Sun Life Trustee Company Private Limited)

Aditya Birla Wellness Private Limited (w.e.f. 23rd June, 2016)

Entity in which Key Managerial Personnel is exercise control

Aditya Birla Management Corporation Private Limited (from 1st January, 2019)

Fellow Subsidiaries

UltraTech Cement Limited

Parent Having Significant Influence

Vodafone Idea Limited (Associate of Ultimate Parent Company upto 31st August, 2018)

Aditya Birla Idea Payments Bank Limited

Trust-Employee Retirement Benefits

Provident Fund of Aditya Birla Nuvo Limited Aditya Birla Nuvo Employee Gratuity Fund Grasim Industries Limited Unit Indian Rayon Grasim Industries Limited - Employee''s Gratuity Fund

Key Managerial Personnel

Mr. Ajay Srinivasan, (Chief Executive Officer)

Mrs. Pinky Mehta (Whole-time Director from 1st July, 2017 to 26th October, 2018) Independent Directors

Mr. Durga Prasad Rathi (Ceased to be a Director w.e.f. 23rd June, 2017)

Mrs. Vijayalakshmi Rajaram Iyer Mr. Arun Adhikari Mr. P. H. Ravikumar Mr. S. C. Bhargava

Refer Annexure 1 for the transactions with related parties.

36 Retirement Benefits

Disclosure in respect of Employee Benefits pursuant to Ind AS -19

iii) Funding Arrangement and Policy

The money contributed by the Company to the fund to finance the liabilities of the plan has to be invested.

The trustees of the plan are required to invest the funds as per the prescribed pattern of investments laid out in the income tax rules for such approved schemes. Due to the restrictions in the type of investments that can be held by the fund, it is not possible to explicitly follow an asset-liability matching strategy to manage risk actively.

Estimated amount of contribution expected to be paid to the fund during the annual period being after the Balance Sheet date is Rs,1.48 Crore (Previous Year Rs,2.23 Crore).

37 Fair Values

The management assessed that Fair Values of Financial Assets and Liabilities are approximately their carrying values.

38 Financial Instruments - Accounting Classifications and Fair Value Measurements

The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

Principles for Estimating Fair Value

The following summarises the major methods and assumptions used in estimating the fair values of financial instruments reflected in the table.

Fair Value Hierarchy

The table below analyses financial instruments carried at fair value, by valuation method at 31st March, 2019. The different levels have been defined as follows:

Level 1: Category includes financial assets and liabilities that are measured in whole or in significant part by reference to published quotes in an active market.

Level 2: Category includes financial assets and liabilities measured using a valuation technique based on assumptions that are supported by prices from observable current market transactions. These include assets and liabilities for which pricing is obtained via pricing services, but where prices have not been determined in an active market, financial assets with fair values based on broker quotes and assets that are valued using the Company''s own valuation models whereby the material assumptions are market observable. The majority of Company''s over-the-counter derivatives and several other instruments not traded in active markets fall within this category.

Level 3: Category includes financial assets and liabilities measured using valuation techniques based on non-market observable inputs. This means that fair values are determined in whole or in part using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data. However, the fair value measurement objective remains the same, that is, to estimate an exit price from the perspective of the Company. The main asset classes in this category are unlisted equity investments as well as unlisted funds.

The carrying amount of trade receivable, trade payable, debt securities, other financial liabilities, loans, other financial assets, cash and cash equivalents as at 31st March, 2019, 31st March, 2018 and 1st April, 2017 are considered to the same as fair values, due to their short-term nature. These are classified as Level 3 fair value hierarchy due to inclusion of unobservable inputs including counter party credit risk. During the reporting period ending 31st March, 2019, there were no transfers between Level 1 and Level 2 fair value measurements.

Assumptions to above:

* The fair valuation of preference shares is based on independent valuers report.

* The fair valuation of unquoted mutual funds units is done based on NAV of units.

* The fair valuation of Private Equity Fund is done based on certified NAV of funds.

39 Financial Risk Management

The Company, being a Core Investment Company as per the Core Investment Companies (RBI) Directions 2016, is required to invest or lend majority of its funds to its subsidiaries and Joint Ventures. The Company''s principal financial liabilities comprise borrowings and trade and other payables. The main purpose of these financial liabilities is to finance and support the Company''s operations. The Company''s principal financial assets include inter corporate deposits, loans, cash and cash equivalents and other receivables.

The Company is exposed to market risk, credit risk, liquidity risk and operational and business risk. The Company''s senior management oversees the management of these risks. The Company''s senior management is supported by a Risk Management Committee that advises on financial risks and the appropriate financial risk governance framework for the Company. The Risk Committee provides assurance to the Company''s senior management that the Company''s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives. The major risks are summarized below:

Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. In the case of the Company, market risk primarily impacts financial instruments measured at fair value through profit or loss. These are primarily unquoted Compulsorily Convertible Preference Shares of subsidiaries and investments in mutual funds and other alternate funds where investments are not significant in relation to the size of its total investments. The fair value investments of these investments are regularly monitored.

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company does not have exposure to the risk of changes in market interest rate as it has debt obligations with fixed interest rates which are measured at amortized cost.

Credit Risk

Credit risk is the risk that the counterparty will not meet its obligations under a financial instrument or a customer contract, leading to a financial loss. The Company is exposed to credit risk from its financing activities towards inter corporate deposits to subsidiaries where no significant impact on credit risk has been identified.

Equity Price Risk

The Company''s investments in non-listed equity securities are accounted at cost in the financial statements net of impairment. The expected cash flows from these entities are regularly monitored to identify impairment indicators.

Liquidity Risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price. The Company''s corporate treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management.

The Company manages its liquidity requirement by analyzing the maturity pattern of Company''s cash flows of financial assets and financial liabilities. The Company''s objective is to maintain a balance between continuity of funding and flexibility through issuance of equity shares, commercial papers, etc. The Company invests its surplus funds in debt schemes of mutual funds, which carry low mark to market risks. Also Refer Note No. 40 for maturity analysis of assets and liabilities.

40 Maturity Analysis of Assets and Liabilities

The table below shows an analysis of assets and liabilities analyzed according to when they are expected to be recovered or settled. Loans and advances to customers, the Company uses the same basis of expected repayment behavior as used for estimating the EIR. Issued debt reflect the contractual coupon amortizations.

Note: The current liabilities of the Company exceed its current assets. The Company has “AAA” long term rating from ICRA (which is the highest long term rating) and therefore high acceptability in the market. Given the track record of the company the management is confident to reduce the mismatch by raising long term funds through equity or other long term instrument(s) and planning accordingly.

41 Impairment on Financial Instruments Background of Expected Credit Loss

Expected Credit loss is a calculation of the present value of the amount expected to be lost on a financial asset, for financial reporting purposes. Credit risk is the potential that the obligor and counterparty will fail to meet its financial obligations to the lender. This requires an effective assessment and management of the credit risk at both individual and portfolio level

The key components of Credit Risk assessment are:

1. Probability of Default (PD): represents the likelihood of default over a defined time horizon.

2. Exposure at Default (EAD): represents how much the obligor is likely to be borrowing at the time of default.

3. Loss Given Default (LGD): represents the proportion of EAD that is likely to be lost post-default.

The definition of default is taken as 90 days past due for all retail and corporate loans.

Delinquency buckets have been considered as the basis for the staging of all loans in the following manner:

- 0-30 days past due loans classified as stage 1

- More than 30-90 days past due loans classified as stage 2 and

- Above 90 days past due loans classified as stage 3

EAD is the total amount outstanding including accrued interest as on the reporting date.

The ECL is computed as a product of PD, LGD and EAD.

Non-Individual Loans

1.1 Credit Quality of Assets

The Non-individual/corporate book is assessed at the loan type level and the provisioning is done at an account level. In certain cases, the assessment is done at an account level based on past experience for future cash flows from the project.

The 12 month PD has been applied on stage 1 loans. The PD term structure i.e Lifetime PD has been applied on the stage 2 loans according to the repayment schedule for stage 2 loans and PD is considered to be 1 for stage 3 loans

The increase in ECLs of the portfolio was driven by an increase in the gross size of the portfolio and movements between stages as a result of increases in credit risk.

42 Details of dues to Micro, Small and Medium Enterprises as per MSMED Act, 2006

Based on the information received by the Company from “suppliers” regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006, there are no amounts due to any suppliers covered under this Act as at the balance sheet date and hence, disclosures relating to amounts unpaid as at the year end together with interest paid / payable as required under the said Act have not been given. Auditors have relied on this.

43 During the current year, the Company has reassessed its value of investments in Aditya Birla Money Limited (“ABML”) based on the Company''s last 2 years profitable business performance and future business plan. Considering investment of long term and strategic nature and based on independent valuation report obtained by the Company, no additional impairment provision is required to be made in the financial statements as at 31st March, 2019 in this regard.

In the previous years the Company had reassessed its value of investments in Aditya Birla Money Limited (“ABML”) and had made a provision of Rs,12.42 Crore as at 31st March, 2014 being 5% against equity shares and the same is carried as at 31st March, 2019.

44 During the previous year, the Company has issued and allotted 48,400,000 Equity Shares of Rs,10 each at a premium of Rs,135.40 per share which were subscribed by P I Opportunities Fund - 1 (AIF).

45 Composite Scheme of Arrangement:

The Composite Scheme of Arrangement (the “Scheme”) amongst the erstwhile Aditya Birla Nuvo Limited (“ABNL”), Grasim Industries Limited (“Grasim”) and Aditya Birla Capital Limited (formerly known as Aditya Birla Financial Services Limited) (“ABCL”), was approved by the National Company Law Tribunal Bench at Ahmadabad on 1st June, 2017.

Pursuant to the Scheme,

- ABCL has become a subsidiary of Grasim with effect from 1st July, 2017

- The Board of Directors of Grasim and ABCL executed the demerger of the financial services business (“Demerged Undertaking”) from amalgamated Grasim into ABCL effective on 4th July, 2017 and accordingly the financial services business of amalgamated Grasim has been demerged into ABCL with effect from 4th July, 2017.

- In accordance with the Scheme, the ABCL has,

- recorded transferred assets and liabilities pertaining to Demerged Undertaking at the respective carrying values as appearing in the books of account of Grasim on the date of demerger;

- issued 920,266,951 Equity Shares of Rs,10 each, which have been issued and recorded at face value, to the shareholders'' of Grasim as on record date; and

- difference between the value of assets and liabilities pertaining to Demerged Undertaking, after adjusting the amount credited to share capital, has been recognized as Capital Reserve.

# The Company also paid a sum of Rs,25 Crore towards stamp duty.

- Further, to fulfil the Company''s commitments under the Scheme, the Board of Directors of the Company have approved the issuance of stock options and restricted stock units under the ABCL Incentive Scheme for Stock Options and Restricted Stock Units 2017 (the “ABCL Incentive Scheme”) for granting of stock options and restricted stock options to the eligible grantees of Grasim Employee Stock Option Scheme 2006and Grasim Employee Stock Option Scheme 2013 (the “Grasim Employee Benefit Schemes”) in the same ratio as the ratio in which shares were issued to the shareholders of Grasim. Under the arrangement, the Company is obligated to issue equity shares not exceeding 1,718,237 at the face value of Rs,10 each against 1,465,927 stock options and 252,310 restricted stock units granted by it to eligible employees of Grasim who held grants of stock options and restricted stock options of Grasim Employee Benefit Schemes. The stock options and restricted stock options thus granted under the ABCL Incentive Scheme would be deemed to be held by the eligible employees of Grasim for determining the minimum vesting period and the vesting conditions and dates for stock options and restricted share units under the ABCL Incentive Scheme would follow the same vesting conditions as applicable to the grantees of for stock options and restricted share units under the Grasim Employee Benefit Schemes. Accordingly, '' 7.37 Crore representing the pro-rata amount of the vested Employee Stock Options Reserve created by Grasim against the Grasim Employee Benefit Schemes has been transferred to the Company against which sum the Company will be entitled to an equivalent cash reimbursement. The balance pro-rata amount of Employee Stock Options Reserve would be transferred to the Company by Grasim upon vesting of the stock options and restricted stock options of Grasim Employee Benefit Schemes with a corresponding cash reimbursement.

46 With effect from 11th October, 2017, 64,422,405 Global Depositary Shares (GDSs) representing 64,422,405 Equity Shares of Rs,10/- each have been admitted for trading on the Luxembourg Stock Exchange.

47 During the previous year, the Company has approved the grant of 24,062,864 Employee Stock Options (ESOPs) and 5,742,636 Restricted Stock Units (RSUs) in accordance with the Employee Stock Option Scheme, 2017 to its employees and employees of subsidiary companies. Further, in continuation to existing Scheme the Company additionally grant 300,000 RSUs and ESOPs 1,623,834 to employees of subsidiary companies.

48 The Company has investment in Equity Shares and Preference Shares of Aditya Birla MyUniverse Limited (“ABMU”) of '' 71.11 Crore (Previous year '' 71.11 Crore) and of Rs,60 Crore (Previous year Rs,60 Crore) respectively and Loan given to ABCSL-Employee Welfare Trust of Rs,10.11 Crore (Previous year Rs,10.11 Crore). Further, the Investee Company''s is making substantial losses and its net worth has been eroded.

During the current year, the Company has made an assessment of its investments in Equity Shares of Aditya Birla MyUniverse Limited '' 71.11 Crore and Loan given to ABCSL-Employee Welfare Trust Rs,10.11 Crore. Based on such assessments, board approved business plan and independent valuation report, an amount of Rs,24.01 Crore and Rs,6.31 Crore (Previous year '' 0.62 Crore) has been provided as impairment loss respectively.

49 The Company has investment in 0.1%-Compulsory Convertible Debentures (CCD) of Aditya Birla Money Mart Limited (“ABMML”) of Rs,33.75 Crore (Previous year Rs,30.96 Crore). The Investee Company (ABMML) is making losses and its net worth has been eroded. Considering the plans and the investment being strategic and long-term in nature, diminution in the value of the said investment has been considered as temporary and hence no provision is required to be made in financial statements as at 31st March, 2019 in this regard.

50 The Company has Long-term incentive plan for selective employees. Long-term Incentive Plan includes future encashment or availment, at the option of the employee subject to the rules framed by the Company which are expected to be availed or encashed beyond 12 months from the end of the year and long term incentive payable to employees on fulfillment of criteria prescribed by the Company. On the basis of proposed scheme the Company has made provision of '' 8.26 Crore.

51 The Company has short-term rating viz. “(ICRA) A1 ” and “(CRISIL) A1 ” accordingly the Company raised funds through Commercial Paper to mitigate working capital requirements.

52 During the current year, the Company has let out its property on rent. Further, the Company has reclassified its property under Investment Property as per Ind AS 40. There is no change in method of calculation of depreciation, rate and useful life as specified earlier.

Investment Property Fair Value

The Company has carried out the valuation activity through the Independent valuer to assess fair value of its Investment Property. As per report provided by independent valuer the fair value is Rs,16.03 Crore as on 31st March, 2019. The fair value of Investment Property have been derived using the Direct Comparison Method based on recent market prices without any significant adjustments being made observable data. Accordingly, fair value estimates for Investment Property is classified as level 3.

The Company has no restrictions on the reliability of its Investment Property and has no contractual obligations to purchase, construct or develop Investment Property.

Information regarding Income & Expenditure of Investment property

53 During the current year, the Company has provided; services to its subsidiaries and other financial services group companies (“Group”), such as strategy and business planning, risk and compliance, technology and operational support, marketing and public relations, human resources, etc. The Company has allocated the cost to the respective companies on the basis of time spent by senior management employees.

54 The Company''s pending litigations comprise of claims by or against the Company primarily by the employees/customers/suppliers, etc. and proceedings pending with tax and other government authorities. The Company has reviewed its pending litigations and proceedings and has adequately provided for where Provisions are required and disclosed the contingent liabilities where applicable, in its financial statements. The Company does not expect the outcome of these proceedings to have a materially adverse effect on its financial statements and appropriate disclosure for contingent liabilities is given refer Note No. 30.

55 Income Tax Disclosure

The Major Components of Income Tax Expense for the years ended 31st March, 2019 and 31st March, 2018 are:

56 The Company has a process whereby periodically all long term contracts are assessed for material foreseeable losses. At the year end, the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses need to be provided as required under any law / accounting standards.

57 Disclosure as required under Annexure I of Master Direction - Core Investment Companies (Reserve Bank), Direction, 2016.

Schedule to the Balance Sheet of a non-deposit taking Core Investment Company (Refer Annexure 2).

Disclosure of details as required under Clause No. 19 of Master Direction - Core Investment Companies (Reserve Bank) Direction, 2016.

a) Provisions as per CIC Guidelines - The Company has provided an amount of '' 0.46 Crore as per guidelines.

b) Exposure to real estate sector, both direct and indirect - Nil

c) Maturity pattern of assets and liabilities

58 First time Adoption of Ind AS

These financial statements, for the year ended 31st March, 2019, are the first financial statements the Company has prepared in accordance with Ind AS. For periods up to and including the year ended 31st March, 2018, the Company prepared its financial statements in accordance with accounting standards notified under Section 133 of the Companies Act, 2013 (Previous GAAP).

Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for periods ending on 31st March, 2019, together with the comparative period data as at and for the year ended 31st March, 2018, as described in the summary of significant accounting policies. In preparing these financial statements, the Company''s opening balance sheet was prepared as at 1st April, 2017, the Company''s date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its Previous GAAP financial statements, including the balance sheet as at 1st April, 2017 and the financial statements as at and for the year ended 31st March, 2018.

Exemptions applied:

Ind AS 101 allows, first time adopters, certain exemptions from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions:

i) The Company has elected to apply Previous GAAP carrying amount of its equipments as deemed cost as on the date of transition to Ind AS, after making necessary adjustments, i.e. capitalization of equipments in accordance with Ind AS.

ii) Appendix C to Ind AS 17 requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS, this assessment should be carried out at the inception of the contract or arrangement. However, the Company has done the assessment of lease in contracts based on conditions in prevailing as at the transition.

iii) The Company has elected to apply previous GAAP carrying amount of its investment in subsidiaries, associates and joint venture as deemed cost as on the date of transition to Ind AS.

Exceptions:

The following mandatory exceptions have been applied in accordance with Ind AS 101 in preparing the financial statements.

i) Estimates

The estimates at 1st April, 2017 and at 31st March, 2018 are consistent with those made for the same dates in accordance with Previous GAAP (after adjustments to reflect any differences if any, in accounting policies) apart from the following items where application of Previous GAAP did not require estimation:

- FVPTL / FVOCI - equity and debt instrument

- Impairment of financial assets based on expected credit loss model

The estimates used by the Company to present these amounts in accordance with the Ind AS reflect conditions as at the transition date and as at 1st April, 2017, the date of transition to Ind AS and as of 31st March, 2018.

ii) De-recognition of financial assets and financial liabilities

The Company has elected to apply the de-recognition requirements for financial assets and financial liabilities in Ind AS 109 prospectively for transactions occurring on or after date of transition to Ind AS.

iii) Classification and measurement of financial assets

The Company has classified the financial assets in accordance with Ind AS 109 on the basis of facts and circumstances that exist at the date of transition to Ind AS.

Notes to Adjustments :

A. Investments

Under the Previous GAAP, the Company had accounted for long term investment measured at cost less provision for other than temporary diminution in the value of investments, Current investments were carried at lower of cost and fair value.

Under Ind AS, the Company has designated investments at amortized cost or fair value through profit and loss (FVTPL) resulting fair value changes of the investments is recognized in equity as at the date of transition and subsequently in the Statement of Profit and Loss for the year ended 31st March, 2018.

B. Share Based Payments

Under the previous GAAP, the cost of equity- settled employee share based plan were recognized using the intrinsic value method. Under Ind AS, the Cost of equity settled share based plan is recognized based on the fair value of the options as at the grant date. There is no impact on total equity.

C. Other Adjustments

Under the previous GAAP, security deposits are recorded at their transaction value. Under Ind AS, the same are required to be recognized at fair value. Accordingly, the company has fair valued these security deposits under Ind AS. Difference between the fair value and transaction value of the security deposits has been recognized as deferred rent expenses. Security deposits measured subsequently at amortized cost and the difference between unwinding of deposits has been recognized as interest income on security deposits in equity as at the date of transition and subsequently in profit or loss for the year ended 31st March, 2018.

59 Reconciliation of Statement of Cash Flows

There were no material differences between statement of cash flows presented under Ind AS and Previous GAAP.

60 Segment Reporting

The main business of the Company is Investment activity, hence there are no separate reportable segments as per Ind AS 108 on ‘Operating Segment''.


Mar 31, 2018

CORPORATE INFORMATION AND BASIS OF PREPARATION

Aditya Birla Capital Limited (formerly known as Aditya Birla Financial Services Limited) (the “Company”) is a listed public company having its registered office at Indian Rayon Compound, Veraval - 362 266, Gujarat. The Company currently operates as a Non-Deposit taking Systemically Important-Core Investment Company (“CIC-ND-SI”) registered with the RBI vide certificate no. B.01.00555 dated 16th October, 2015.

Information on other related party relationships of the Company is provided in Note No 29.

The financial statements have been prepared in accordance with Generally Accepted Accounting Principles in India (Indian GAAP) under the historical cost convention on an accrual basis in compliance with all material aspect of the Accounting Standard (AS) notified under Section 133 of the Companies Act, 2013 read with the Companies (Accounting Standards) Rules, 2006, as amended (“Accounting Standards”), and other accounting principles generally accepted in India. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.

All assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle, and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of services and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as up to twelve months for the purpose of current/non-current classification of assets and liabilities.

1) Term/Right Attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of the equity shares held by the shareholders.

2) Equity Shares in the Company held by each shareholder holding more than 5 per cent shares and the number of equity shares held are as under:

* Pursuant to the Composite Scheme of Arrangement (the “Scheme”) amongst the erstwhile Aditya Birla Nuvo Limited (ABNL), Grasim Industries Limited (Grasim) and the Company 920,266,951 equity shares of Rs.10 each were issued to Grasim as fully paid up in exchange of the assets of the Financial Services Business. The scheme has been described more elaborately in Note No. 34

3) Reclassification of Authorised Share Capital

a) During the current year the Company had reclassified its Authorised Share Capital. The revised structure comprises 4,000,000,000 Equity Shares of Rs.10 each.

b) During the previous year the Company had reclassified its Authorised Share Capital. The revised structure comprises 2,200,000,000 Equity Shares of ’ 10 each and 1,800,000,000 Preference Shares of Rs.10 each.

4) Conversion of Preference Shares:

a) During the previous year 56,500,000-0.01% Non Cumulative Compulsorily Convertible Preference Shares of Rs.10 each were due for conversion on the existing terms and conditions. Accordingly, the Company had converted preference shares into 5,650,000 fully paid Equity Shares of Rs.10 each at premium of Rs.90 each.

b) During the previous year the Company had made early conversion of its 280,000,000-0.01% Non Cumulative Compulsorily Convertible Preference Shares of Rs.10 each into 28,000,000 fully paid Equity Shares of Rs.10 each at premium of Rs.90 each.

5) Rights Issue of Equity Shares:

During the previous year the Company made,

a) Rights issue of 20,000,000 Equity Shares of Rs.10 each at a premium of Rs.90 each.

b) Right issue of 382,580,000 Equity Shares of Rs.10 each at a premium of Rs.60 each.

6) During the previous year the Company made early redemption of its 1,471,110,000-6% Non-Convertible Non- Cumulative Redeemable

Preference Shares of Rs.10 each held by erstwhile Aditya Birla Nuvo Limited. The same is approved by Board of Directors’ and accounted accordingly. The redemption is made as per existing terms and conditions.

7) During the last five years no Bonus Shares were issued.

8) The shares reserved for issue under Employee Stock Option Plan (ESOP) of the Company (Refer Note No. 35 & 36)

(a) Special Reserve

Special Reserve represents the reserve created pursuant to the Reserve Bank of India Act, 1934 (the “RBI Act”). In terms of Section 45-IC of the RBI Act, a Non-Banking Finance Company is required to transfer an amount not less than 20 per cent of its net profit to a Reserve Fund before declaring any dividend. Appropriation from this Reserve Fund is permitted only for the purposes specified by RBI.

2. Deferred Tax Liabilities / Assets

The Company has not recognised deferred tax asset in respect of timing differences related to depreciation on fixed assets, carried forward losses and compensated absence at the end of the year as there is no virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such net deferred tax asset can be realised.

3. Employee Benefit Plans and Employee Contribution Plans (A) Defined benefit plan:

The Company operates defined benefit, viz. gratuity for its employees. Under the gratuity plan, every employee who has completed at least five years of service gets a gratuity on departure at minimum 15 days of last drawn salary for each completed year of service.

The following tables summarise the components of net benefit expense recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet for respective plans.

4. Details of dues to Micro, Small and Medium Enterprises as per MSMED Act, 2006

Based on the information received by the Company from “suppliers” regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006, there are no amounts due to any suppliers covered under this Act as at the balance sheet date and hence, disclosures relating to amounts unpaid as at the year end together with interest paid / payable as required under the said Act have not been given. Auditors have relied on this.

5. Contingent Liabilities and Commitments

a. Capital Commitments:

i) There are no capital commitment as on 31st March, 2018 (31st March, 2017 Rs.1.02 Crore).

ii) Pursuant to the Shareholders’ Agreement entered into with Sun Life of Canada by the Aditya Birla Capital Limited, in respect of Aditya Birla Sun Life Insurance Company Limited (formerly known as Birla Sun Life Insurance Company Limited), the Company has agreed to infuse share capital from time to time to meet the solvency requirement prescribed by the regulatory authority.

Transfer of investments in Aditya Birla Sun Life Insurance Company Ltd., is restricted by the terms contained in Shareholder Agreements entered into by the Company.

b. Contingent Liabilities:

Aditya Birla MyUniverse Limited (formerly known as Aditya Birla Customer Services Limited) (ABMU), a subsidiary of the Company, has issued 0.001% Compulsorily Convertible Preference Shares (CCPS) aggregating to Rs.60 Crore to International Finance Corporation (IFC) vide Shareholders’ Agreement, dated 19th December, 2014, and Subscription Agreement dated 19th December, 2014 (SHA). Under the said SHA, the Company has granted to IFC an option to sell the shares to the Company at fair valuation from the period beginning on the expiry of 60 months of the subscription by IFC up to a maximum of 120 months from the date of subscription by IFC, in the event ABMU fails to provide an opportunity to IFC to exit from ABMU within 60 months from the date of subscription by IFC in the form of Listing, secondary sale or acquisition, etc. In the event ABMU fails to fulfill its obligation, the Company will be obligated to fulfill this obligation.

6. Segment Reporting

Since the Company operates in single segment (i.e. investments and financing activities), no further disclosure is required to be given as per the notified AS-17 ‘Segmental Reporting’.

7. During the current year, the Company has reassessed its value of investments in Aditya Birla Money Limited (“ABML”) based on the Company’s last 2 years profitable business performance and future business plan. Considering investment of long term and strategic nature and based on independent valuation report obtained by the Company, no additional impairment provision is required to be made in financial statements as at 31st March, 2018 in this regard.

The Company had reassessed its value of investments in Aditya Birla Money Limited (“ABML”) and had made a provision of Rs.12.42 Crore in FY 2013-2014 being 5% against equity shares and the same is carried as at 31st March, 2018.

8. During the current year, the Company has issued and allotted 48,400,000 Equity Shares of Rs.10 each at a premium of Rs.135.40 per share which were subscribed by P I Opportunities Fund 1 (AIF). (Refer Note No. 3)

9. Composite Scheme of Arrangement:

The Composite Scheme of Arrangement (the “Scheme”) amongst the erstwhile Aditya Birla Nuvo Limited (“ABNL”), Grasim Industries Limited (“Grasim”) and Aditya Birla Capital Limited (formerly known as Aditya Birla Financial Services Limited) (“ABCL”), was approved by the Hon’ble National Company Law Tribunal Bench at Ahmedabad on 1st June, 2017.

Pursuant to the Approved Scheme:

- ABCL has become a subsidiary of Grasim with effect from 1st July, 2017

- The Board of Directors of Grasim and ABCL executed the demerger of the financial services business (“Demerged Undertaking”) from Grasim (post its amalgamation with ABNL) into ABCL effective on 4th July, 2017 and accordingly the financial services business of amalgamated Grasim has been demerged into ABCL with effect from 4th July, 2017.

- In accordance with the Scheme, the ABCL has:

— recorded transferred assets and liabilities pertaining to Demerged Undertaking at the respective carrying values as appearing in the books of account of Grasim on the date of demerger;

— issued 920,266,951 Equity Shares of Rs.10 each, which have been issued and recorded at face value, to the shareholders’ of Grasim as on record date; and

— difference between the value of assets and liabilities pertaining to Demerged Undertaking, after adjusting the amount credited to share capital, has been recognised as Capital Reserve.

- Further, to fulfil the Company’s commitments under the Scheme, the Board of Directors of the Company have approved the issuance of stock options and restricted stock units under the ABCL Incentive Scheme for Stock Options and Restricted Stock Units 2017 (the “ABCL Incentive Scheme”) for granting of stock options and restricted stock options to the eligible grantees of Grasim Employee Stock Option Scheme 2006 and Grasim Employee Stock Option Scheme 2013 (the “Grasim Employee Benefit Schemes”) in the same ratio as the ratio in which shares were issued to the shareholders of Grasim. Under the arrangement, the Company is obligated to issue equity shares not exceeding 1,718,237 at the face value of Rs.10 each against 1,465,927 stock options and 252,310 restricted stock units granted by it to eligible employees of Grasim who held grants of stock options and restricted stock options of Grasim Employee Benefit Schemes. The stock options and restricted stock options thus granted under the ABCL Incentive Scheme would be deemed to be held by the eligible employees of Grasim for determining the minimum vesting period and the vesting conditions and dates for stock options and restricted share units under the ABCL Incentive Scheme would follow the same vesting conditions as applicable to the grantees of for stock options and restricted share units under the Grasim Employee Benefit Schemes. Accordingly, Rs.7.37 Crore representing the pro-rata amount of the vested Employee Stock Options Reserve created by Grasim against the Grasim Employee Benefit Schemes has been transferred to the Company against which sum the Company will be entitled to an equivalent cash reimbursement. The balance pro-rata amount of Employee Stock Options Reserve would be transferred to the Company by Grasim upon vesting of the stock options and restricted stock options of Grasim Employee Benefit Schemes with a corresponding cash reimbursement.

10. ABCL Incentive Plan 2017:

The Scheme titled as “ABCL Incentive Scheme for Stock Options and Restricted Stock Units - 2017 (ABCL Incentive Scheme)” was approved by the shareholders through postal ballot on 10th April, 2017. The Nomination, Remuneration and Compensation Committee of the Company at their meeting held on 15th January, 2018, granted 1,465,927 ESOPs and 252,310 Restricted Stock Units (RSUs) (Collectively called as “Stock Options”) to the eligible grantees pursuant to the Composite Scheme of Arrangement between erstwhile Aditya Birla Nuvo Limited (now merged with Grasim Industries Limited), Grasim Industries Limited and Aditya Birla Capital Limited (formerly known as Aditya Birla Financial Services Limited) (Refer Note No. 34). Out of the above, the Company; has granted 195,040 ESOPs and 45,060 RSUs under this Scheme to a Director of the Company. The Stock Options allotted under the Scheme are convertible into equal number of Equity Shares.

The vesting conditions and the vesting dates under the ABCL Incentive Scheme shall follow the same vesting conditions, as applicable to the Grantees under the corresponding Grasim Employee Benefit Scheme 2006 and 2013

Since the above grants were part of the acquisition of financial services business as part of Scheme of Arrangement amongst Aditya Birla Nuvo Limited, Grasim Industries Limited and Aditya Birla Capital Limited as per Note No. 34, and these being issued to Grasim and ABNL ESOP and RSU holders there would be no impact on earnings per share arising from differences between intrinsic value and fair value of Options and RSU’s.

11. Disclosure under Employee Stock Options Scheme

At the Annual General Meeting held on 19th July, 2017, the shareholders of the Company approved the grant of not more than 32,286,062 Equity Shares by way of grant of Stock Options (“ESOPs”) and Restricted Stock Units (“RSUs”). Out of these, the Nomination, Remuneration and Compensation Committee has granted 24,062,864 ESOPs and 5,742,636 RSUs under the Scheme titled “Aditya Birla Capital Limited Employee Stock Option Scheme 2017” in 3 categories of Long Term Incentive Plans (“LTIP”) identified as LTIP 1, LTIP 2, and LTIP 3. The Scheme allows the Grant of Stock options to employees of the Company (whether in India or abroad) that meet the eligibility criteria. Each option comprises one underlying Equity Share.

The intrinsic value of the ESOP i.e. the difference between the fair value of the shares underlying the ESOP granted on the date of grant of option and the exercise price of the option is expensed over the vesting period.

The ESOP compensation cost is amortised on a straight line basis over the total vesting period of the options. Accordingly Rs.10.64 Crore has been charged to the current year Statement of Profit and Loss (Previous Year ‘ Nil).

Fair Valuation:

The fair value of the options used to compute proforma net profit and earnings per share have been done by an independent valuer on the date of grant using Black - Scholes Merton Formula. The key assumptions and the Fair Value are as:

12. With effect from 11th October, 2017, 64,422,405 Global Depositary Shares (GDSs) representing 64,422,405 Equity Shares of ’ 10/- each have been admitted for trading on the Luxembourg Stock Exchange.

13. The Company has investment in Equity Shares and Preference Shares of Aditya Birla MyUniverse Limited (“ABMU”) of Rs.71.11 Crore (Previous year Rs.71.11 Crore) and of Rs.60 Crore (Previous year Rs.60 Crore) respectively. The Investee Company (ABMU) is making substantial losses and its net worth has been eroded. Based on the business plan of ABMU and strategic investment by International Finance Corporation in the ABMU in the previous year, the Company has assessed the value of ABMU being higher than the investment. Accordingly, based on the business plan and considering that the investment being long term and strategic in nature, and diminution in the value of the said investment has been considered as temporary; no provision is required to be made in financial statements as at 31st March, 2018 in this regard.

14. The Company has investment in 0.1% Compulsory Convertible Debentures (CCD) of Aditya Birla Money Mart Limited (“ABMML”) of Rs.26.01 Crore (Previous year Rs.26.01 Crore). The Investee Company (ABMML) is making losses and its net worth has been eroded. Considering the plans and the investment being strategic and long-term in nature, diminution in the value of the said investment has been considered as temporary and hence no provision is required to be made in financial statements as at 31st March, 2018 in this regard.

15. During the current year, the Company has provided; services to its subsidiaries and other financial services group companies (“Group”), such as strategy and business planning, risk and compliance, technology and operational support, marketing and public relations, human resources, etc. The Company has allocated the cost to the respective companies on the basis of time spent by senior management employees. Increase in retention amount as compared to previous year is mainly because of retention of promotional expenses.

16. The Company’s pending litigations comprise of claims by or against the Company primarily by the employees/ customers/suppliers, etc. and proceedings pending with tax and other government authorities. The Company has reviewed its pending litigations and proceedings and has adequately provided for where Provisions are required and disclosed the contingent liabilities where applicable, in its financial statements. The Company does not expect the outcome of these proceedings to have a materially adverse effect on its financial statements and appropriate disclosure for contingent liabilities is given refer note no. 30

17. The Company has short-term rating viz. “(ICRA) A1 ” and “(CRISIL) A1 ” accordingly the Company raised funds through Commercial Paper to mitigate working capital requirements.

18. Disclosure as required under Annexure I of Master Direction - Core Investment Companies (Reserve Bank), Direction, 2016.

Schedule to the Balance Sheet of a non-deposit taking Core Investment Company (Refer Annexure 2).

19. Disclosure of details as required under Clause No. 19 of Master Direction - Core Investment Companies (Reserve Bank) Direction, 2016.

(a) Provisions as per CIC Guidelines - The Company has provided an amount of Rs.0.28 Crore as per guidelines.

(b) Exposure to real estate sector, both direct and indirect - Nil

(c) Maturity pattern of assets and liabilities

20. The figures for the previous year ended 31st March, 2017 are subjected to audit by the previous Auditors vide their report dated 9th May, 2017.

21. Figures Rs.50,000 or less have been denoted by 3.

22. Previous Year’s figures have been regrouped / rearranged, wherever necessary.


Mar 31, 2017

1. Corporate Information

Aditya Birla Financial Services Limited (the ‘Company’) was incorporated on October 15, 2007. The Company is a Public Limited Company incorporated under the provisions of the Companies Act, 1956. The registered office of the Company is located at Indian Rayon Compound, Veraval, Gujarat - 362 266. The Company had received Certificate of Registration from the Reserve Bank of India (‘RBI’) on May 19, 2009 to commence/carry on the business of non-banking financial institution.

The Company is a Non-Deposit taking Systemically Important Core Investment Company (CIC-ND-SI) registered with the Reserve Bank of India vide certificate no B.01.00555 dated October 16, 2015. The Company has been set up as a holding company for the Financial Services Business of Aditya Birla Nuvo Limited.

(A) Term/Right Attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution to all preferential holders. The distribution will be in proportion to the number of the equity shares held by the shareholders.

(B) Shares in the Company held by each shareholder holding more than 5 per cent shares and the number of shares held are as under:

2. Deferred Tax Liabilities/ Assets

The Company has not recognized net deferred tax asset in respect of timing differences related to depreciation on fixed assets, carried forward losses and Leave encashment at the end of the year as there is no virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such net deferred tax asset can be realized.

3. Employee Benefit Plans and Employee Contribution Plans (A) Defined benefit plans :

The Company operates defined plans, viz., gratuity, for its employees. Under the gratuity plan, every employee who has completed at least five years of service gets a gratuity on departure at minimum 15 days of last drawn salary for each completed year of service. The scheme is funded with an insurance company in the form of qualifying insurance policy. The following tables summarize the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for respective plans.

4. Details of dues to Micro, Small and Medium Enterprises as per MSMED Act, 2006

Based on the information available with the Company, no amounts have fallen due for payment to suppliers who have registered under the Micro, Small and Medium Enterprise Development Act, 2006 as at March 31, 2017.

5. Contingent Liabilities and Commitments

a. Capital Commitments:

i) There is capital commitment of which Rs.10,200,000 as on March 31, 2017 (March 31, 2016 Rs. NIL) towards Intangible Assets under Development for Digital/Technology related projects.

ii) The Company has subscribed to the memorandum of the new Company (Aditya Birla ARC Limited (ARC)) incorporated on March 10, 2017 for ARC business. The Board has approved Equity Participation/Investment up to an amount not exceeding Rs.20,000,000 in one or more tranches in the Company.

iii) Pursuant to the Shareholders’ Agreement entered into with Sun Life of Canada by the Aditya Birla Nuvo Limited - the Holding Company, in respect of Birla Sun Life Insurance Company Limited, the Company agreed to infuse its share of capital from time to time to meet the solvency requirement prescribed by the regulatory authority. Transfer of investments in Birla Sun Life Insurance Company Ltd., is restricted by the terms contained in Shareholder Agreement entered into by Aditya Birla Nuvo Limited - the Holding Company.

b. Contingent Liabilities:

i) Aditya Birla Customer Services Ltd. (ABCSL), a subsidiary of the Company, has issued 0.001%- Compulsorily Convertible Preference Shares (CCPS) aggregating to Rs.60 Crore to International Finance Corporation (IFC) vide Shareholders’ Agreement, dated 19th December, 2014, and Subscription Agreement dated December 19, 2014 (SHA). Under the said SHA, the Company has granted to IFC an option to sell the shares to the Company at fair valuation from the period beginning on the expiry of 60 months of the subscription by IFC up to a maximum of 120 months from the date of subscription by IFC, in the event ABCSL fails to provide an opportunity to IFC to exit from ABCSL within 60 months from the date of subscription by IFC in the form of Listing, Secondary Sale or Acquisition, etc. In the event ABCSL fails to fulfill its obligation, the Company will be obligated to fulfill this obligation.

6. Segment Reporting

Since the Company operates in single segment (i.e. investments and financing activities), no further disclosure is required to be given as per the notified AS-17 ‘Segmental Reporting’.

7. Related Party Disclosure

Names of related parties where control exists irrespective of whether transactions have occurred or not. Refer Annexure 1 for the transactions with related parties.

8. During the current year, the Company has reassessed its value of investments in Aditya Birla Money Limited (‘‘ABML”) based on the Company’s last 2 years profitable business performance and future business plan. Considering investment of long term and strategic nature and based on independent valuation report obtained by the Company, no additional impairment provision is required to be made in financial statements as at March 31, 2017 in this regard.

In the previous years the Company had reassessed its value of investments in Aditya Birla Money Limited (“ABML”) and had made a provision of Rs.124,151,400 as at March 31, 2014 being 5% against equity shares and the same is carried as at March 31, 2017.

9. Scheme of Arrangement between Subsidiary Companies:

- During the year, the Hon’ble High Court of Gujarat, Ahmedabad approved the Scheme of Arrangement vide order O/COMP/445/2016 dated November 24, 2016, and the certified true copies of the scheme and order were received on December 21, 2016., whereby the Wealth Management Undertaking of Aditya Birla Money Mart Limited (ABMM), a subsidiary of the Company was demerged and transferred to Aditya Birla Finance Limited (ABFL), also a subsidiary of the Company, with the Appointed Date of April 1, 2016. The Scheme of Arrangement was made effective on December 31, 2016.

- In consideration of the demerger, the Company has received 10,277,778 equity shares of Rs.10 each of ABFL as per the share entitlement ratio determined based on an independent valuation report at 3 equity shares of Rs.10 each in ABFL for every 8 equity shares of ‘10 each held in ABMM and 1 equity share of Rs.10 each in ABFL for every 36 0.01%-Redeemable Non Convertible Preference Shares of Rs.10 each held in ABMM.

- As per the Scheme of Arrangement, the general purpose borrowings in ABMM have been transferred to the Company in proportion to the value of assets transferred to ABFL. Accordingly, ABFL has issued 0.1%- Compulsory Convertible Debentures (CCD) of value of Rs.239,913,400 to the Company in lieu of such amount of CCD of ABMM which were transferred to ABFL. Hence the current holding pattern of CCD’s by the Company is as under:

a) ABFL - Rs.239,913,400

b) AMML - Rs.260,086,600

- The carrying value of the investments in ABMM (net of impairment) is considered to be at fair value of asset given up for equity shares received from ABFL.

10. The Company has investment in Equity Shares and Preference Shares of Aditya Birla Customer Services Limited (“ABCSL”) of Rs.711,098,369 (Previous year Rs.711,098,369) and of ‘599,999,999 (Previous year Rs.599,999,999) respectively The Investee Company (ABCSL) is making substantial losses and its net worth has been eroded. Based on the business plan of ABCSL and strategic investment by International Finance Corporation in the ABCSL in the previous year, the Company has assessed the value of ABCSL being higher than the investment. Accordingly, based on the business plan and considering that the investment being long term and strategic in nature, and diminution in the value of the said investment has been considered as temporary; no provision is required to be made in financial statements as at March 31, 2017 in this regard.

11. The Company has investment in 0.1%- Compulsory Convertible Debentures (CCD) of Aditya Birla Money Mart Limited (“ABMML”) of Rs.260,086,600 (Previous year Rs.500,000,000). The Investee Company (ABMML) is making losses and its net worth has been eroded. Considering the plans and the investment being strategic and long-term in nature, diminution in the value of the said investment has been considered as temporary and hence no provision is required to be made in financial statements as at March 31, 2017 in this regard.

12. During the current year, the Company has, to its subsidiaries and other financial services group companies (“Group”), provided services such as strategy and business planning, risk and compliance, technology and operational support, marketing and public relations, human resources, etc. The Company has retained approximately 30% of the total cost and allocated the balance to the respective companies on the basis of time spent, marketing budget and number of employees. Increase in retention percentage as compared to previous year is mainly because of higher retention of Long Term Incentive Plan. The amount allocated to the various companies is as given hereunder:

13. The Company has reviewed all its pending litigations and proceedings and has adequately provided for where provisions are required and disclosed the contingent liabilities where applicable, in its financial statements. The Company does not expect the outcome of these proceedings to have a material adverse effect on its financial results at March 31, 2017.

14. Current tax for the year of Rs. NIL (previous year Rs.18,138,367) includes the tax on the income accrued under Section 115U of the Income Tax Act, 1961 on the Venture Capital Investment.

15. The Company has a process whereby periodically all long term contracts are assessed for material foreseeable losses. At the year end, the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses need to be provided as required under any law / accounting standards.

16. Conversion of Preference Shares:

a) During the year 56,500,000 0.01%- Non Cumulative Compulsorily Convertible Preference Shares of Rs.10 each were due for conversion on the existing terms and condition, accordingly the Company has converted preference shares into 5,650,000 fully paid Equity Shares of Rs.10 each at premium of Rs.90 each.

b) During the year the Company has made early conversion of its 280,000,000 0.01%- Non Cumulative Compulsorily Convertible Preference Shares of Rs.10 each into 28,000,000 fully paid Equity Shares of Rs.10 each at premium of Rs.90 each.

17. During the year the Company has reclassified its Authorised Share Capital. The revised structure comprises of 2,200,000,000 Equity shares of Rs.10 each and 1,800,000,000 Preference Shares of Rs.10 each.

18. Rights Issue of Equity Shares:

During the year the Company made,

a) Rights issue of 20,000,000 Equity Shares of Rs.10 each at a premium of Rs.90 each.

b) Right issue of 382,580,000 Equity Shares of Rs.10 each at a premium of Rs.60 each.

19. During the year the Company made early redemption of its 1,471,110,000 6%- Non-Convertible Non Cumulative Redeemable Preference Shares of Rs.10 each held by Aditya Birla Nuvo Limited. The redemption is made as per existing terms and conditions.

20. During the year, the Board of Directors of the Company at its Board Meeting held on August 11, 2016, had approved a Composite Scheme of Arrangement between Aditya Birla Nuvo Limited (ABNL), Grasim Industries Limited (GIL) and the Company and their respective shareholders and creditors (‘Scheme’). The Scheme provides for the amalgamation of ABNL with GIL on a going concern basis, demerger of the financial services business from amalgamated GIL into the Company post the amalgamation and consequent listing of the equity shares of the Company. The approval for the Scheme had been received from the Competition Commission of India. The Hon’ble National Company Law Tribunal, Bench at Ahmedabad (NCLT) had directed holding of the meeting of the Shareholders of the Company on April 10, 2017 and the Shareholders of the Company have unanimously approved the Scheme. The Company has filed the Petition with the NCLT for approval of the Scheme. Pending approval of the Scheme, no effect has been given in the financial statements of the Company

21. During the year the Company acquired 969,616,080 Equity shares of Birla Sun Life Insurance Company Limited (BSLI) constituting 51% of the issued and subscribed share capital of BSLI, from Aditya Birla Nuvo Limited (ABNL), the Company’s Holding Company after obtaining requisite approvals from Reserve Bank of India (RBI) and Insurance Regulatory and Development Authority of India (IRDA).

22. During the year ICRA rated Commercial Paper Program of ABFSL as “(ICRA) A1 ” and accordingly the Company raised funds through Commercial Paper amounting to Rs.500 Crore.

23. During the year the Company has introduced Long Term Incentive Plan for selective employees. Long Term Incentive plan includes future encashment or availment, at the option of the employee subject to the rules framed by the Company which are expected to be availed or encashed beyond 12 months from the end of the year and long term incentive payable to employees on fulfillment of criteria prescribed by the Company.

24. Cash transaction in specified bank notes:

The company did not hold or transact in Specified Bank Notes (SBN) during the period from November 08, 2016 to December 30, 2016. The SBN shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407(E), dated November 08, 2016.

25. Disclosure as required under Annexure I of Master Direction - Core Investment Companies (Reserve Bank), Direction, 2016.

Schedule to the Balance Sheet of a non-deposit taking Core Investment Company (Refer Annexure 2).

26. Disclosure of details as required under Clause No. 19 of Master Direction - Core Investment Companies (Reserve Bank) Direction, 2016.

(a) Provisions as per CIC Guidelines - The Company has not provided any amount related standard assets, sub standard assets, doubtful and loss assets.

(b) Exposure to real estate sector, both direct and indirect - Nil

(c) Maturity pattern of assets and liabilities

27. Previous year’s figures have been regrouped / rearranged to confirm to the current year’s presentation, wherever necessary.

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