DIRECTORS' REPORT

To The Members,

The Directors have pleasure in presenting 33rd Annual Report on the business and operations of the Company along with the Audited Statements of Accounts for the year ended 31st March, 2018

Economic Review

During the year end under review, it was contrasting two half for the Indian Economy in which first half was embarked by adjustment relating to Demonetization and practical difficulties relating to implementation of Goods & Service Tax (GST) faced by the Industry that affected the business sentiment during the first half. However, the things were dramatically improved in the second half, after the complete demonetization of the Indian economy and smoothening of GST reforms, business sentiments improved positively resulting in Gross Domestic Product (GDP) projected to grow at 7.2% during second half as compared to 6.1% growth seen in first half, during the year end under review.

The reforms implemented by the Government, alongwith accommodative RBI monetary Policy, smoothen the ease and way of doing business in India. Further implementation of Insolvency & Bankruptcy Code gave the much needed powers to the Banks/NBFCs/Financial Institutions to convert NPAs into recoverable Assets. The growth story of the Indian economy further boosted by improved rating by the credit rating agency moody's and a long jump in ranking from 132 to 100 in World Bank's Doing Business Assessment report.

Overview of Financial Performance

As compared to last year the business and revenues of the Company and Group was weakened during the year end under review, due to lacklustre capital market activities particularly in the mid level segment, lesser demand of capital expenditure by the Industry, rise in banking fraud particularly in PSU Banks resulting in lesser credit approvals by the Banks/Financial Institutions, affected the Company's Investment Banking Income both in Equity and Debt segment and Company's revenues through investment activities in Government Securities / Corporate Bonds was also affected by rise in inflation due to higher crude oil prices resulting in tightening by RBI Monetary policy by increasing the interest rates. These factors affected the top line resulting in lower bottom line profits of the Company and the Group as a whole.

The company's standalone income from operations during the Financial Year 2017-18 was reduced by almost half to Rs.2780.52 as compared to Rs.5300.84 lakhs during previous Financial Year 2016-17, and also consolidated Income from operations dropped to Rs.3349.80 lakhs as against Rs. 6219.85 lakhs in the previous year.

No material changes and commitments have occurred after the close of the year till the date of this Report, which affect the financial position of the Company.

Share Capital

During the year under review, the Company's Issued, Subscribed and Paid up Equity Share Capital remains unchanged at Rs.1229.69 lakhs as at March 31st, 2018.

Dividend

Due to lower profit the Board of Directors of the Company has decided not to recommend dividend for the Financial Year 2017-18.

Subsidiary Companies

During the Financial Year 2017-18, there were no changes in status of existing six wholly owned subsidiaries as compared to previous year. During the year end under review, the Company has redeemed its investment of 6,00,000 redeemable preference shares of Rs.100/- each at par in Inifinity.Com Financial Securities Ltd. and also invested in said Subsidiary by subscribing to 3,00,000 6% Non Cumulative Non Participating Redeemable Preference Shares of Rs.100/- each fully paid up.

Consolidated Financial Statements

The Board of Directors of the Company has resolved not to publish and attach copies of the standalone Annual Audited Accounts of all its existing subsidiaries and instead to publish the Consolidated Accounts pursuant to Section 136(1) of the Act. Annual Audited Accounts of all its existing subsidiaries can also be obtained by members of the Company by making written request to the Company. The Accounts of these subsidiaries are also available for inspection to members of the Company at the Registered Office of the Company during the Company's business hours. The Company has attached the Consolidated Financial Statements in this Annual Report, which includes Accounts of all its six existing subsidiaries

Directors Responsibility Statement

Your Directors state that:

i) In the preparation of the Annual Accounts for the year ended 31st March, 2018, the applicable Accounting Standards read with requirements set out under Schedule III of the Companies Act, 2013 have been followed and there are no material departures from the same;

ii) They have selected such accounting policies and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2018 and of the Profit of the Company for the year ended on that date;

iii) They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

iv) The annexed Annual Accounts for the Accounting Year ended on 31st March, 2018, have been prepared on a going concern basis;

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

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

Management Discussion and Analysis

The Management Discussion and Analysis Report for the year under review, is given as a separate statement in the Annual Report..

Directors and Key Management Personnel

During the year end under review, there was no change in the composition of the Board of Directors of the Company.

During the year end under review, there was no change in the existing Key Management Personnel, however Mr. Rakesh Bhatia, Chief Financial Officer (CFO) of the Company has resigned w.e.f. 1st June, 2018 due to ill health consequently Board of Directors of the Company has appointed Mr. Sanjay Kabra as CFO of the Company, w.e.f. 02nd August, 2018.

The Board of Directors of the Company place on record sincere appreciation and gratitude to Mr. Rakesh Bhatia, for his valuable contribution in the growth and development of PINC Group during his tenure and wish him all the best.

Annual Evaluation

Your Company in line with the provisions of the Companies Act, 2013, Listing Regulations, has laid down Policy in which criteria for performance evaluation of the Directors including Chairman, Managing Director, Board Committees and Board as a whole as well as the evaluation process for the same. The Policy continued to assist the Company the manner in which formal annual evaluation should be made.

Corporate Governance

Corporate Governance is based on the principles of conducting the business with all integrity, fairness, and being transparent with all the transactions, making the necessary disclosures and decisions, complying with the laws of the land, accountability and responsibility towards the stakeholders and commitment of conducting the business in an ethical manner. As part of the Company's efforts towards better corporate practice and transparency, a separate report on Corporate Governance compliances is included in the Annual Report.

Contracts and Arrangement with Related Parties

There were no materially significant transactions with related parties including promoters, directors, key managerial personnel, subsidiaries or relatives of the Directors during the financial year which could lead to a potential conflict with the interest between the company and these parties. The details of the transactions with related parties, if any, were placed before the Audit Committee from time to time. There were no material individual transactions with related parties, which were not in the ordinary course of business of the Company, nor were there any transactions with related parties, which were not on arm's length basis.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website at www.pinc.co.in. Your Directors draw attention of the members to Note no.30 to the financial statement which sets out related party transactions disclosures.

Corporate Social Responsibility (CSR)

In compliance with Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, your Company has established Corporate Social Responsibility ('CSR') Committee. During the financial year 2017-18, the Company has spent Rs.21 lakhs on CSR activities as approved by the Board of the Company. The disclosure in the Annual Report on CSR activities is annexed herewith marked as Annexure 2.

Risk Management Policy

Company's Risk Management Policy continued to guide the Board on risk assessment, management and contributes to controls, manage, measure and mitigate the risk faced by the management in the day to day operation. The Risk Management policy intends to cover serious concerns that could have risk impact on the operations and performance of the business of the Company as well as its Wholly Owned Subsidiaries.

Internal Financial Controls

Your Company has implemented adequate procedures and internal controls which provide reasonable assurance regarding reliability of financial reporting and preparation of financial statements. Further, the Board also keeps updating internal control systems by recommending necessary modifications in light of changing business requirements.

Employee Stock Option Scheme

The Employee Stock Option Scheme is administered by the Nomination & Remuneration Committee of the Board. The disclosures required to be made in the Directors' Report in respect of Employees Option Schemes, in terms of the SEBI (Employee Stock Option Scheme) Guidelines, 1999, are mentioned in the Annexure 3, forming part of the Directors' Report.

Out of the 13,14,000 Stock Options granted to the Employees of the Company last year by the Nomination and Remuneration Committee 25% of granted Stock options has been vested during the year end under review, as per the terms and conditions of the grant.

Auditors and Auditors Report

As members of the Company are aware that the Company in order to comply with the applicable provisions of the Companies Act, 2013 and the Rules made there under, relating to mandatory rotation of Statutory Auditors, the Company has obtained members approval in the last AGM to appoint J. D. Jhaveri & Associates, Chartered Accountant (Firm Reg. no. 111850W) as the statutory auditors of the Company, to hold office for a period of five consecutive years commencing from the Financial Year 2017-18, on a remuneration that may be determined by the audit committee in consultation with the auditors, and that such remuneration may be paid on a progressive billing basis. However, such appointment is subject to ratification by the members of the Company at the Annual General Meeting of the Company as per the applicable provisions of the Companies Act, 2013 and the Rules made there under. Accordingly, the appointment of J. D. Jhaveri & Associates, Chartered Accountant (Firm Reg. no. 111850W) as the statutory auditors of the Company is being placed before the members of the Company for ratification.

The Notes to the Accounts referred to in the Auditors' Report are self-explanatory and therefore, do not call for any further explanation. The Auditors' Report does not contain any qualification, reservation or adverse remark.

Secretarial Auditor

Pursuant to Section 204 of the Companies Act, 2013, your Company had appointed Mr. Aspi Bhesania, Practicing Company Secretary, (ICSI membership number: 6119 C.P. no.9657) as its Secretarial Auditors to conduct the secretarial audit of the Company for the financial year 2017-18. The Company provided all assistance and facilities to the Secretarial Auditors for conducting their audit. The Report of Secretarial Auditors for the financial year 201718 is annexed to this report as Annexure 4. There are no observations, reservations or adverse remarks in the Secretarial Audit Report.

DISCLOSURES:

Audit Committee

The Audit Committee comprises of Independent Directors namely Mr. C C. Dalal (Chairman), Mr. A. B. Desai, Mrs. K.C. Maniar and Mr. G. M. Gandhi - Managing Director. All the recommendations made by the Audit Committee were accepted by the Board during the Financial Year 2017-18.

Vigil Mechanism

In line with the provisions of Listing Regulations, the Companies Act, 2013 and the principles of good governance, your Company has devised and implemented a vigil mechanism, in the form of 'Whistle Blower Policy', for the directors and employees to report genuine concerns in such manner as, may be prescribed. Such a vigil mechanism shall provide for adequate safeguards against victimization of persons who use such mechanism and also make provision for direct access to the chairperson of the Audit Committee in appropriate or exceptional cases. The Policy on vigil mechanism and whistle blower policy may be accessed on the Company's website at www.pinc.co.in

Meetings of the Board

Six meetings of the Board of Directors were held during the year. For further details, please refer separate report on Corporate Governance forming part of Annual Report.

Declaration from Independent Directors

The Company has received declaration from all the Independent Directors of the Company confirming that they meet with the criteria of independence as per sub-section (6) of Section 149 of the Companies Act, 2013.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the standalone financial statement (Please refer to Note nos.10, 11, 17 and 26 of the standalone financial statement).

Conservation of Energy, Technology Absorption, Foreign Earnings and Expenditures.

The Company has no activities involving conservation of Energy and Technology absorption.

The details of Company's foreign exchange earnings and expenditures during the year under review are given in Note no.25 to the standalone financial statement.

Extract of Annual Return

Extract of Annual Return of the Company is annexed herewith as Annexure 5 to this Report.

Familiarization Programs for Independent Directors

Details of programs that were undertaken for familiarizing the Independent Directors can be accessed on the Company's website at www.pinc.co.in.

Investor Education and Protection Fund (IEPF)

Pursuant to the applicable provisions of the Companies Act, 2013, read with the I EPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (“the Rules”), all unpaid or unclaimed dividends which remains unclaimed or unpaid for seven years from the date of transfer to unpaid account, are required to be transferred by the Company to the IEPF established by the Central Government.

Further, according to the Rules, the shares in respect of which dividend have not been claimed or paid by the shareholders for seven consecutive years or more shall also be transferred to the Demat Account created by the IEPF Authority.

a) Dividend

The following are the details of dividend paid by the Company and its respective due date of transfer of such fund to the Central Government, which remains unpaid:

Members wishing to claim dividends, which have remained unclaimed, are requested to correspond with Registrar and Share Transfer Agents (RTA) or Company Secretary at the Company's Registered office

b) Shares

Further, the corresponding shares will be transferred as per the requirements of IEPF rules, details of which will be provided on Company's website www.pinc.co.in.

Particulars of Employees and related disclosures

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules is annexed herewith as Annexure 6 to the Annual Report. Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is also annexed herewith as Annexure 7 to the Annual Report

General

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

1. Details relating to deposits covered under Chapter V of the Act.

2. Issue of equity shares with differential rights as to dividend, voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

4. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

5. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.

Your Directors further state that during the year under review, there was no cases filed pursuant to the Sexual

Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Acknowledgments

The Board wishes to express its deep appreciation to all the staff members for their excellent contribution and to the Bankers, shareholders and customers for their continued support.

On behalf of the Board of Directors

Mumbai G. M. Gandhi C. C. Dalal

2nd August, 2018. Managing Director Director

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