CONTENT SO
ENGROSSING...
EROS INTERNATIONAL MEDIA LIMITED
ANNUAL REPORT 2017-18
FY2018 Highlights
` 10,100 mn
Annual Revenue
` 3,679 mn
Earning Before Interest
and Tax
` 2,293 mn
Profi t after Tax*
`23.92
Diluted EPS
36.4%
EBIT Margin, y-o-y
expansion of 10.3%
22.7%
PAT Margin, y-o-y
expansion of 4.9%
24
No. of Theatrical
Releases
*after minority interests
FORWARD-LOOKING STATEMENTS
Certain statements in this report concerning the future growth prospects are forward-looking statements, which involve a number of risks and uncertainties that could cause
actual results to differ materially from those in such forward-looking statements. In some cases, these forward-looking statements can be identifi ed by the use of forward-look-
ing terminology, including the terms “believes”, “estimates”, “forecasts”, “plans”, “prepares”, “projects”, “anticipates”, “expects”, “intends”, “may”, “will” or “should” or, in each
case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward-looking
statements include all matters that are not historical facts. They appear in a number of places throughout this report and include, but are not limited to, statements regarding
the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, fi nancial condition, liquidity, prospects,
growth, strategies, business development, the markets in which the Company operates, expected changes in the Company’s margins, certain cost or expense items as a
percentage of the Company’s revenues, the Company’s relationships with theater operators and industry participants, the Company’s ability to source fi lm content, the com-
pletion or release of the Company’s fi lms and the popularity thereof, the Company’s ability to maintain and acquire rights to fi lm content, the Company’s dependence on the
Indian box offi ce success of its fi lms, the Company’s ability to recoup box offi ce revenues, the Company’s ability to compete in the Indian fi lm industry, the Company’s ability
to protect its intellectual property rights and its ability to respond to technological changes, the Company’s contingent liabilities, general economic and political conditions in
India, including fi scal policy and regulatory changes in the Indian fi lm industry. By their nature, forward-looking statements involve known and unknown risk and uncertainty be-
cause they relate to future events and circumstances. The forward-looking statements speak only as of the date they are made and are not guarantees of future performance
and the actual results of the Company’s operations, fi nancial condition and liquidity, and the development of the markets and the industry in which the Company operates
may differ materially from those described in, or suggested by, the forward-looking statements contained in these materials. The forward-looking statements in this report are
made only as of the date hereof and the Company undertakes no obligation to update or revise any forward-looking statement, whether as a result of current or future events
or otherwise, except as required by law or applicable rules.
Get
Immersed…
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#1
Storyboard
Content So Engrossing
Trailer
Snapshot FY2018
Next Show
Forthcoming Film & Content Slate
Scripting Engrossment
Executive Message
Directing Blockbusters
Board of Directors
Detour to the Studio
Business Profi le
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#2
Post Production Analysis
Management Discussion & Analysis 32
When Directors Report
Directors’ Report
Through the Looking Glass
Corporate Governance Report
36
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#3
Small Budget Slate
Standalone Financial Statements
Big Budget Slate
Consolidated Financial Statements 127
Invite to the Premier
Notice to the AGM
169
83
2 ANNUAL REPORT 2017-18
2 ANNUAL REPORT 2017-18
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
Content So
Engrossing…
Content so engrossing that the urge to watch more
keeps on growing. On the one hand is the captivating
premium content from Eros repertoire; pairing on
the other hand is a multitude of viewing options –
theatres, television, online, offl ine – aptly augmented
by new media, burgeoning technology and enhanced
connectivity. Hunting in a pair, original content and
viewing choices are culminating in entertainment
being consumed at a pace never witnessed and at
places least expected before.
EROS INTERNATIONAL MEDIA LIMITED 3
EROS INTERNATIONAL MEDIA LIMITED 3
We saw entertainment becoming the new oxygen well ahead of our peers. And,
prepared hard. We prepared across technologies and digital platforms, and
more importantly, across a content framework that addressed the individual
needs of a wide spectrum of audience classes - children, adolescents and
adults; parents and grandparents; singles, committed, familywalas - nuclear as
well as joint; cosmopolitan, urban, and rural; Hindi speaking ones, Telugus and
Tamils; brick and mortar as well as SVoD. All along, we kept a sharp eye on
the genre diversity – romance, action, suspense, comedy, period and sequels.
We saw this future shaping up well in advance, drew our strategic blueprint and
got going with precise execution. The future that we envisaged and prepared
for in the last many years is unfolding. Right here, right now!
We take pleasure in unveiling the evolving face of entertainment of tomorrow
in our Annual Report 2017-18. This entertainment knows no boundaries, play
to the whims of the audience, syncs with her/his current mood, accompanies
her/him all the way, all the time and most importantly, is content driven. It is not
always dependent on the star cast or hefty dollars spent on grand production
budgets. Welcome to the era of entertainment 24x7. Welcome to the era of
CONTENTainment.
4 ANNUAL REPORT 2017-18
4 ANNUAL REPORT 2017-18
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
EROS INTERNATIONAL MEDIA LIMITED 5
EROS INTERNATIONAL MEDIA LIMITED 5
Gauri Pujari,
Merchant Banker, Mumbai
6 ANNUAL REPORT 2017-18
6 ANNUAL REPORT 2017-18
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
Eros International Media
Ltd. produces/acquires
content for Eros Now,
parent Eros International
Plc’s OTT service
EROS INTERNATIONAL MEDIA LIMITED 7
EROS INTERNATIONAL MEDIA LIMITED 7
The Trailer
Snapshot of the Year
A Year of Amassing Content-scaling Partnerships
and Film Slate
8
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QUARTER
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We signed a signifi cant TV syndication deal with Zee
Entertainment for the three forthcoming movies from our
slate, namely, Sarkar 3, Munna Michael, and Shubh Mangal
Savdhaan.
The release of Eros’ fi rst franchise fi lm, Sniff – I Spy, was
accompanied with the launch of a comic book series,
arcade game and merchandise.
We announced a fi rst of its kind Indo-Turkish co-production
deal with Pana Films, a leading fi lm studio, owned by the well
-acclaimed Turkish actor Necati Sasmaz.
Newton, our political comedy-drama fi lm got selected
as India’s offi cial entry to the Oscars in 2018 under the
language category of Best Foreign Film.
8
1
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7
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2
QUARTER
3
8
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QUARTER
4
Eros announced its fi rst animal themed fi lm, Haathi Mere
Saathi, a trilingual fi lm to be shot in Tamil, Telugu and Hindi
and deploying visual effects of a scale never seen before in
any movie pertaining to the animal fi lm genre.
We entered into an equal joint venture parnership with the
country’s leading business house, Reliance Industries, to
invest upto ` 10 billion to produce and acquire Indian fi lms
and digital originals across all languages.
We signed a four fi lm co-production deal with Drishyam
Films, a reputed fi lm production house that has a knack
to deliver compelling stories produced on relatively smaller
budgets.
Bajrangi Bhaijaan, our 2015 blockbuster, got released
in China and went on to gross ` 3 billion, engaging the
Chinese audience with a soul touching cross-border story
of love and compassion.
8 ANNUAL REPORT 2017-18
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
Key Performance Indicators-FY2018
REVENUE (` Million)
EBIT (` Million)
16,257
14,410
14,453
11,396
10,100
3,616
3,549
3,768
3,679
2,997
FY2014 FY2015 FY2016 FY2017 FY2018
FY2014 FY2015 FY2016 FY2017 FY2018
PROFIT AFTER TAX (` Million)*
DILUTED EPS (`)
2,471
2,387
2,575
2,393
1,997
26.43
25.40
27.00
23.92
21.63
FY2014 FY2015 FY2016 FY2017 FY2018
FY2014
FY2015
FY2016
FY2017
FY2018
REVENUE MIX (FY2018)
10.90%
46.30%
42.80%
Theatrical
TV & Others
Overseas
Key Figures
FINANCIAL YEAR
FY2018
FY2017
FY2016
FY2015
FY2014
(` Million)
PROFIT AND LOSS ACCOUNT HIGHLIGHTS
Revenues
10,100
14,453
16,257
14,410
11,396
Earnings Before Interest and Taxes (EBIT)
Profi t After Tax (PAT)*
EPS (`)
BALANCE SHEET HIGHLIGHTS
Equity Share Capital
Net Worth
Property, Plant and Equipment and Intangible
Assets (Excluding Goodwill)
3,679
2,293
23.92
949.70
22,430
26,915
3,768
2,575
27.00
938.50
20,091
27,065
3,549
2,387
25.40
935.80
17,678
25,983
3,616
2,471
26.43
925.00
14,822
22,322
2,997
1,997
21.63
917.00
12,086
16,197
Book Value Per Share (`)
236.18
214.05
188.89
160.23
131.41
* Profi t after tax (PAT) After Minority Interest
EROS INTERNATIONAL MEDIA LIMITED 9
10 ANNUAL REPORT 2017-18
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CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
Films Released in FY2018
An Eclectic Spread of Love, Thrill, Laughter,
Action, Drama…
HINDI FILMS
Rukh
Mukkabaaz
Raid (Overseas)
Kadvi Hawa
Ribbon
Newton
Shubh Mangal Saavdhan
Munna Michael
Sniff
Sarker 3
Door Bell
Sabrang
Dream Zindagi
Mera Bura Saaya
REGIONAL FILMS
Rong Beronger Kori
Bengali
Aamhi Doghi
Marathi
Viswa Vikhyatharaya
Payyanmar
Malayalam
Oru Kidayin Karunai
Manu
Tamil
Tujha Tu Mujha Mi
Marathi
Posto
Bengali
Aake
Kannada
Baap Janma
Marathi
Projapti Biskut
Bengali
Boss 2
Bengali
EROS INTERNATIONAL MEDIA LIMITED 11
Eros International Media Ltd.
produces/acquires content for Eros
Now, parent Eros International Plc’s
OTT service
12 ANNUAL REPORT 2017-18
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CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
Kapil & Shailja Sharma,
Financial Consultants, Gurugram
EROS INTERNATIONAL MEDIA LIMITED 13
EROS INTERNATIONAL MEDIA LIMITED 13
Teasers FY2019
and Beyond
Forthcoming Releases
Forthcoming Film Content Slate*
Film Name
Star Cast (Director/Producer)
Language
Tentative
Release
Happy Phir Bhaag Jayegi
Manmarziyaan
Sonakshi Sinha, Abhay Deol, Jimmy Shergill (Mudassar
Aziz / Colour Yellow Productions)
Abhishek Bachchan, Vicky Kaushal, Tapsee Pannu
(Anurag Kashyap / Colour Yellow Productions)
Helicopter Eela (Overseas)
Kajol, Riddhi Sen, Tota Roy Chowdhury (Pradeep Sarkar)
Tumbbad
Sohum Shah, Harish Khanna (Colour Yellow Productions/
A Little Town Productions)
Namaste England (Overseas)
Arjun Kapoor, Parineeti Chopra (Vipul Amrutlal Shah)
Boyz II
(Everest Entertainment)
Haathi Mere Saathi
Rana Dugabatti (Prabhu Soloman)
Ticket to Bollywood
Amyra Dastoor, Diganth Manchale / (Eros)
Kaptan
Saif Ali Khan, Zoya and others (Navdeep Singh / Colour
Yellow Productions)
Mumbai Pune Mumbai 3
Swapnil Joshi, Mukta Barve
Nervazhi
Guru Tegh Bahadur
Kaamiyab
Cobra
Untitled
Nayanthara (Bharath Krishna)
(Harry Baweja)
Drishyam Films
Gautam Ghulati, Tarun Khanna, Nyra Banerjee, Ruhi Singh,
Director - Munesh Rawal
Ravi Vasudevan
Annum Pennum
Rajish Parameshwaran
Untitled
Untitled
Jaita
Ankhen 2
Vijith Nambiar
(Homi Adajania / Maddock Films)
Harman Baweja (Harry Baweja)
Amitabh Bachchan & Others
Shubh Mangal Savdhan - 2
(Colour Yellow Productions)
Panda (Indo-China)
Tannu Weds Manu 3
Roam Rom Mein
Chandamama Door Ke
Pitch White
Untitled
Heer
Fake
Re-Union
Hera Pheri -3
14 ANNUAL REPORT 2017-18
(Kabir Khan)
Aanand L Rai
Nawazuddin Siddiqui & others (Tanishtha Chatterjee /
Rising Star Entertainment)
Sushant Singh Rajput, Nawazuddin Siddiqui (Sanjay Puran
Singh)
(Vipul Shah)
(Rahul Dholakia / Next Gen Films)
(Colour Yellow Productions)
(Raj & DK)
(Sujoy Ghosh)
Suniel Shetty and others
Hindi
Q2 FY2019
Hindi
Hindi
Hindi
Hindi
Marathi
Hindi / Tamil /
Telugu
Hindi
Hindi
Marathi
Tamil
Punjabi
Hindi
Hindi
Malayalam
Malayalam
Malayalam
Hindi
Hindi
Hindi
Hindi
Hindi
Hindi
Hindi
Hindi
Hindi
Hindi
Hindi
Hindi
Hindi
Hindi
Q2 FY2019
Q2 FY2019
Q3 FY2019
Q3 FY2019
FY2019
FY2019
FY2019
FY2019
FY2019
FY2019
FY2019
FY2019
FY2019
FY2019
FY2019
FY2019
FY2019
FY2019
FY2020
FY2020
FY2020
FY2020
FY2020
FY2020
FY2020
FY2020
FY2020
FY2020
FY2020
FY2020
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
Film Name
Phobia 2
2 Guns
R. Rajkumar 2
Khalifey
Make in India
Jugaadu
1234 (Part 2)
Star Cast (Director/Producer)
Language
(Next Gen Films - Pawan Kriplani)
(Krishna Jagarlamudi)
(Prabhu Deva / Next Gen Films)
Sanjay Dutt, Saif Ali Khan, Arshad Warsi (Prakash Jha)
(Next Gen Films)
Harman Baweja
Suniel Shetty, Paresh Rawal (Ashwni Dhir)
Hindi
Hindi
Hindi
Hindi
Hindi
Hindi
Hindi
Tentative
Release
FY2020
FY2020
FY2020
FY2020
FY2020
FY2020
FY2020
Eros Digital Content Slate*
Side Hero with Rohan Sippy: Featuring Kunaal Roy Kapur as
a fi ctionalised version of himself – the less successful younger
brother of a hotshot Bollywood producer and star – this comedy-
drama follows Kunaal trying to land a leading role in a bid to
prove that his profession of acting is not just a ‘hobby.’ (Target
release September 2018)
Smoke: An unfl inching look at the politics within the drug mafi a
that resides in the intoxicant riddled underbelly of its tropical
paradise, Goa. Smoke is led by an all-star cast including Jim
Sarbh, Gulshan Devaiah, Kalki Koechlin, Mandira Bedi, Tom Alter
amongst others. (Target release October 2018)
Dashavatar with Anirudh Pathak: When mankind became
corrupt and greedy, Vishnu, the protector of the realms,
incarnated to vanquish evil and save the world. Dashavatar tells
this fascinating story of Vishnu’s reincarnations. (Target release
December 2018/January 2019)
Ponnyin Selvin with Krish Jagarlamudi: A multi-seasonal, multi-
lingual show based on the famous Tamil novels. Written in fi ve
volumes, Ponniyin Selvan narrates the story of Arulmozhivarman
– later crowned as Rajaraja Chola I - one of the kings of the
Chola Dynasty, during the 10th and 11th centuries. (Target
release March 2019)
Flesh with Siddharth Anand: An eight-year-old girl goes missing
and her NRI parents are forced to seek the help of a suspended
female cop in their search for her. An ex-human traffi cker is
blackmailed to join the search or else risk his sinful past catching
with him. (Target release March 2019)
Mrityulok with Zeishan Qadri: A story that shows a mirror to the
ruthless, selfi sh face of the society and how we all are culprits in
a system that offers no incentive to “be good”. (Target release
March 2019)
Bhumi with Pavan Kripilani: A survival thriller set in a dystopian
version of Delhi which begs the question, how far is our reality
from this supposedly fi ctional dystopia? (Target Release April
2019)
* Indicative list, subject to change
“At Eros, we successfully
premiered India’s fi rst fi lm
to be digitally released,
Aanand L. Rai’s fi rst Eros Now original
‘Meri Nimmo’, on the platform in April
2019. A promising slate of originals are
being produced internally in partnership
with the best talent and consist of many
fresh and global concepts that will
entertain the audience.”
Crisis with Nikhil Advani and Gaurav Chawla: On the day of
his 50th birthday, Dr Gopichand Wadhwani – one of India’s
top cardiologists – decides to follow his childhood dream and
become a rapper. Crisis is a story of two generations coming
together to help each other get from life what they want. (Target
Release May 2019)
Sanyasi Raja with Prakash Jha: A fi ctional depiction of the
infamous Bhawal case of West Bengal, in which a possible
imposter claimed to be the prince of Bhawal, who was at that
point presumed dead for over a decade. (Target release June
2019)
Kurukshetra: The tribals thought they were Gods. The army
thought they were militants. What they turn out to be, are fi ve
children with ‘superpowers’ emerging from a genetic mutation.
And with destinies that, almost uncannily, resemble the trajectory
of the Mahabharata. (Target release TBD)
Blue Oak Academy: A teen-drama thriller that follows one
young boy’s quest to exact revenge with the most prestigious
academic institution of the nation. (Target release June 2019)
Apart from this, Eros also has a selection of upcoming short form
content and short fi lm anthologies to accompany this slate.
EROS INTERNATIONAL MEDIA LIMITED 15
Scripting
Engrossment
Executive Message
that we, at Eros, sensed and seized well in time. All our
energies and resources are being devoted in accelerating
the pace and scale of our operations in line with these three
factors.
The fi scal year, 2017-18 (FY2018), was a year of rebooting
Eros on its path of enhanced profi tability and sustained
growth. It proved to be a landmark year that witnessed
our EBIT and PAT margin expanding by 10.3% and 4.9%,
respectively, while we contained our new releases to a
modest 24 from 44 in the previous year. Restraint on
higher budget fi lms was a strategic decision taken due to
our stringent green lighting and budgeting processes and
with an objective to have low dependence on box offi ce
collections. We diverted all our focus to high RoI projects,
with potentially low-risk profi le. With the focus on compelling
stories produced within prudent budgets across languages,
de-risking investments with sizeable pre-sales and optimizing
catalogue and ancillary revenues, the enhanced profi tability
of FY2018 bore testament to the effi cacy of our business
strategy and model.
Honing a pool of in-house creative talent and strategically
partnering with fi lm production entities with a proven content
stickiness in India and elsewhere are two essential elements of
our content-driven approach. An Indo-Turkish co-production
deal with Pana Films of Turkey and another co-production
deal with Drishyam Films during the year and the most recent
partnership with Baahubali famed iconic writer, V Vijayendra
Prasad, shall prove to be decisive enablers of our content
prowess in the coming years. The selection of Newton, our
political comedy-drama fi lm, as India’s offi cial entry to Oscars
2018 and screening of our Tamil drama, Oru Kidayin Karunai
Manu, at the 17th edition of ‘The New York Indian Film
Festival’ as the offi cial choice are prestigious validations that
inspire us on the path of content centricity.
Dear fellow owners,
The confl uence of the millennial audience and rapidly
advancing technology juggernaut is creating a tectonic shift
in the world of entertainment. The screens are getting smaller,
viewing individualized, critique democratized and content
diversifi ed. The viewing hours and viewer base continue to
rise. Entertainment is increasingly becoming omnipresent
and all encompassing.
While theatre and television screens still rule the roost in
delivering fi lmed entertainment, millennial consumers are
geared up to swamp the scene now. Typical millennials –
those born between 1981 and 1996 (aged 22 to 37 years
in 2018) and post-millenials – are overly digital, prefer to
buy almost everything – from clothes to food – online, are
pretty cool using shared cars and don’t fret about owning a
television.
Content as the best bet for healthy RoI, digital viewing as
the new normal and internationalization of audience beyond
diaspora for Indian entertainment are the three undercurrents
We released 24 fi lms in FY2018, mostly medium and low-
budget ones across genres and languages. Revenues during
the year were driven by the release of sports-based dramas
16 ANNUAL REPORT 2017-18
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
“The most signifi cant development of FY2018 came in the form
of an industry- defi ning partnership that we inked with Reliance
Industries Limited in the fourth quarter of FY2018. In this strategic
content creation and acquisition partnership, Eros and Reliance
would invest a whopping ` 10 billion to produce and consolidate
fi lm and digital across India.”
Deshpande resigned from the role of being an executive
director to undertake a new role with Reliance Industries at the
beginning of FY2019. She, however, continues to be steering
Eros Group in two capacities; fi rst as a non-executive Director
and second as a key decision maker in our content JV with
Reliance Industries. The zeal, creativity, ardour and conviction
of our employees form the bedrock of our current and future
success. A big thanks to you – our valued shareholders, for
your unequivocal support and trust in Eros. I also express
my deep gratitude to our Board members for their relentless
guidance and torch-bearing efforts.
We look forward to your support in weaving magic on the
screen and good wishes to continue our entertainment
journey…
Warm Regards,
Sunil Arjan Lulla
Executive Vice Chairman & Managing Director
like Mukkabaaz, Raid (Overseas), Ribbon, Rukh, Kadvi
Hawa; super hit comedy Shubh Mangal Savdhan, Newton,
Munna Michael, Sniff, Sarkar 3, Aamhi Doghi (Marathi), Rong
Beronger Kori (Bengali), Oru Kidayin Karunai Manu (Tamil),
Tujha Tu Majha Mi (Marathi), Aake (Kannada), Posto (Bengali),
Projapati Biskut (Bengali), Baap Janma (Marathi) and Boss 2
(Bengali). Our mix of movies from different genres has further
strengthened our position as a Company that offers versatility
and uniqueness in content.
Serving engaging and engrossing content is our hallmark.
Consolidating the fragmented Indian fi lmed entertainment
market is the fuel that drives this passion. With the changing
market dynamics of the entertainment industry – with OTT
markets driving the entertainment consumption – we are at
vantage to leverage our capabilities of quality content and
world-class technology-driven distribution. We have also
broken an industry stereotype by successfully premiering
India’s fi rst digital release, Meri Nimmo on Eros Now, our
parent company’s OTT platform. As we make new strides,
we are confi dent that our fi lm and digital content slate will
contribute further to accelerate Eros Now’s paid subscription
growth, which in this year itself grew by 276%.
The most signifi cant development of FY2018 came in the
form of an industry defi ning partnership that we inked with
Reliance Industries Limited in the fourth quarter of FY2018.
In this strategic content creation and acquisition partnership,
Eros and Reliance would invest a whopping ` 10 billion to
produce and consolidate fi lm and digital across India. The
partnership adds signifi cant strength to our existing content
slate while mitigating investment risks - as we benefi t by
leveraging both our distribution networks. Expressing
confi dence in our capabilities and business prospects,
Reliance Industries acquired a 5% equity stake in our parent
company, Eros International Plc.
A shining star of our Board and our then Chairman, Mr. Naresh
Chandra, left for his heavenly abode on July 9, 2017. Another
esteemed colleague and insightful board member, Ms. Jyoti
EROS INTERNATIONAL MEDIA LIMITED 17
Directing Blockbusters
Board of Directors
Mr. Dhirendra
Swarup
Non-Executive
Chairman,
Independent
Mr. Sunil Arjan Lulla
Executive Vice
Chairman &
Managing Director
A government-certifi ed accountant and a member of the
Institute of Public Auditors of India, Mr. Swarup holds a post-
graduate degree in humanities. A career bureaucrat, he retired
as secretary of Ministry of Finance, Government of India in 2005.
He possesses a vast experience of 45 years in the fi nance sector
and has also worked in the UK, Turkey and Georgia. Currently
serving as the Chairman of Financial Sector Redress Agency,
he is also on the Board of several listed companies besides
acting as a member and the Chairman of several committees.
In the past, he has held many key positions and responsibilities
like being a member of the Board of the SEBI, a member of
the Permanent High-level Committee on Financial Markets,
chairman of the Pension Funds Regulatory Authority, Chief of the
Budget Bureau of the Government of India, a member secretary
of the Financial Sector Reforms Commission, chairman of Public
Debt Management Authority Task Force, vice-Chairman of the
International Network on Financial Education of OECD.
Mr. Lulla holds a commerce degree from the University of
Mumbai. Possessing an expansive 25 year long experience in
the Media & Entertainment industry, he has been associated with
Eros since its inception. He led the Company’s growth within India
for many years before being appointed Executive Vice Chairman
and Managing Director of Eros India on September 28, 2009.
Mr. Lulla was reappointed to the same position on September
3, 2015 for another period of fi ve years. During his stint, he
has contributed tremendously in developing and expanding
the Company’s business in India. Under his able leadership,
the Company continued to achieve milestones. He has been
instrumental in developing the Company’s distribution business
along with its home entertainment and music segments.
Mr. Kishore Arjan
Lulla
Executive Director
Mr. Rakesh Sood
Non-Executive,
Independent
The Executive Chairman and Group Chief Executive Offi cer of
our parent Company, Eros International Plc., Mr. Lulla holds a
bachelor’s degree in Arts from Mumbai University. Possessing a
rich experience of over 30 years in the fi lmed entertainment and
media industry, he is a member of the British Academy of Film
and Television Arts and Young Presidents’ Organization besides
serving on the board of the School of Film at the University
of California, Los Angeles. Mr. Kishore Arjan Lulla has been
instrumental in expanding the Company’s presence in the United
Kingdom, the U.S., Dubai, Australia, Fiji and other international
markets. He is responsible for taking the Indian fi lm industry to the
global arena. A recipient of the ‘Asian Business Awards’ 2007,
the ‘Indian Film Academy Awards’ 2007, and ‘Entrepreneur of
the Year’ 2010, ‘Global Citizenship Award’ 2014, ‘Entertainment
Visionary Award’ 2015, he has also featured on the ‘Best under
a Billion’ 2014 list of Forbes Asia and got invited to attend the
“billionaires’ summer camp” in the Sun Valley.
Mr. Sood holds a masters degree in Physics from St. Stephen’s
College, Delhi University and a post-graduate in Economics and
Defence Studies. He joined the Indian Foreign Service (IFS) in
1976 after briefl y working at DCM and SBI. In his 36 years long
diplomatic career, Mr. Sood served India’s diplomatic missions
in Brussels, Dakar, Geneva and Islamabad in varied capacities
and as the Deputy Chief of Mission in Washington. Having set
up the Disarmament and International Security Affairs Division
at Delhi and heading it for eight years, he was responsible for
multilateral disarmament negotiations relating to chemical and
biological weapons, nuclear tests, etc., and establishing bilateral
dialogues with the USA, Pakistan, France and the ASEAN
Regional Forum. He has also served as an Ambassador on the
Conference of Disarmament in Geneva, Afghanistan, Nepal and
France, and been appointed as a Special Envoy of the Prime
Minister (SEPM) for disarmament and non-proliferation issues.
As a commentator, panelist and speaker on the foreign policy
and international security issues, he keeps on addressing various
forums, newspapers and television channels in India and abroad.
18 ANNUAL REPORT 2017-18
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
Mrs. Jyoti
Deshpande
Non-Executive,
Non-Independent
Mr. S.
Lakshminarayanan
Non-Executive,
Independent
In an illustrious media and entertainment career spanning
25 years, Mrs. Deshpande has gained a rich and diverse
experience across advertising, media consulting, television
and fi lms domain. Having been a part of the leadership team
of Eros International since 2001 and Group CEO & MD since
2012, she has spearheaded Eros’ growth as a global leader
in Indian fi lmed entertainment. She has been featured twice in
Fortune India’s coveted ‘50 Most Powerful Women in Business’
list (2015/2017). In April, 2018, Mrs. Deshpande gave up her
executive responsibilities to spearhead Reliance Industries’
Media and Entertainment business as the President of the
Chairman’s Offi ce, while she continues to serve on the Board as
a non-executive Director.
Mr. Lakshminarayanan joined the Indian Audit and Accounts
service in 1965. After holding various positions in the Audit and
Accounts Department, he retired as the Deputy Comptroller
and Auditor General in 2002. During the period, he served
in the Ministry of Personnel and Pensions as Additional
Secretary and earlier in the Railways and Ministry of Defense,
Government of India. Several successful stints have helped
Mr. Lakshminarayanan gain experience in cadre management,
staff welfare, purchases and contracts, fi nancial advice and
accounting. With a commendable knowledge on the relevant
rules and regulations, he has led offi ces comprising as many
as 1500 employees. He has also provided direction, guidance
and created administrative framework for the companies. Mr.
Lakshminarayanan also has an international exposure.
Mr. Sunil
Srivastav
Non-Executive,
Independent
Mr. Naresh Chandra
Non-Executive
Chairman,
Independent*
Mr. Srivastav retired as the Dy. Managing Director, Corporate
Accounts Group, from the State Bank of India (SBI). He was
responsible for a large corporate credit exposure, including
project and infrastructure fi nancing for the bank. In an illustrious
career spanning over three decades with the SBI, he rose from
the ranks holding several leadership positions, including DMD –
CSNB, CGM – Kolkata and GM – Delhi, accomplishing several
achievements like initiating the Bank’s foray into digital delivery
of fi nancial products and services, entry into the new lines of
businesses, including identifi cation and negotiation with global
JV partners, managing and growing operations of a network of
1450 offi ces in Bengal, Sikkim and Andaman & Nicobar, and
growing the bank’s business in the mountainous terrain in the
State of Uttarakhand.
Mr. Naresh Chandra was our Non-Executive Chairman and
Independent Director until his sad and sudden demise on 09
July, 2017 (from 28 September, 2009). Having joined the Indian
Administrative Service in 1956, he served in many leadership
roles including Chief Secretary in the State of Rajasthan;
Commonwealth Secretariat Adviser on Export Industrialisation
and Policy in Sri Lanka; Adviser to the Governor of Jammu and
Kashmir; and Secretary to the Ministries of Water Resources,
Defence, Home and Justice in the Federal Indian Government.
He became Cabinet Secretary in 1990 and got appointed as
Senior Advisor to the Prime Minister of India in 1992. He served
as the Governor of Gujarat in 1995-1996 and Ambassador
of India to the United States of America during 1996-2001.
He had also chaired the Committee on Corporate Audit and
Governance; the Committee on Private Companies and Limited
Liability Partnerships and the Committee on Civil Aviation Policy,
for the Government of India. He was honoured with the Padma
Vibhushan in 2007.
*Ceased to be the Chairman and Non-Executive Independent
Director upon his sudden demise on 9 July, 2017.
EROS INTERNATIONAL MEDIA LIMITED 19
Shikha Swaroop,
Editor, Bengaluru
20 ANNUAL REPORT 2017-18
20 ANNUAL REPORT 2017-18
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
Eros International Media Ltd.
produces/acquires content
for Eros Now, parent Eros
International Plc’s OTT service
EROS INTERNATIONAL MEDIA LIMITED 21
EROS INTERNATIONAL MEDIA LIMITED 21
Detour to
the Studio
Business Profi le
the
face of
We, at Eros International, are a pioneering
Indian fi lm
corporate
entertainment industry. Flag bearing the
cause of taking Indian cinema to the
global standards and diverse audiences
for almost four decades, we acquire,
co-produce and distribute Indian fi lms
across theatrical, television, digital and
ancillary formats. We are the owners of
one of the largest movie library of over
2,000 fi lms and counting. Our enviable
library includes recent as well as classic
titles that span across genres, budgets
and languages. We deploy a multi-lever
business model comprising the release
of new fi lms, catalogue sales of our
library titles, syndication deals with TV
channels, the overseas release of Indian
language fi lms among others.
Our
robust distribution capabilities
enable us to take fi lms to every nook and
corner of the country. The scale, variety
and stickiness of entertainment content
and consequent global monetization of
this content through diverse channels,
formats and media have been the key to
our business growth.
22 ANNUAL REPORT 2017-18
22 ANNUAL REPORT 2017-18
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
EROS INTERNATIONAL MEDIA LIMITED 23
EROS INTERNATIONAL MEDIA LIMITED 23
Television Distribution
We serve India, one of the largest and growing television
markets in the world, by licensing high-quality Indian fi lm
content to satellite television broadcasters operating in India
including Colors, Sony, the Star Network and Zee and a host
of regional channels. We leverage television pre-sales of new
releases towards revenue predictability and lowering the risk
profi le.
Theatrical Distribution
India’s theatrical market comprises both multiplex and single
screen theatres, which are 100% digitally equipped. We
distribute our content in all the 14 circuits predominantly
through our own distribution offi ces, deploying sub-
distributors on a selective basis. Own distribution network
yields greater control, transparency and fl exibility and also a
larger share of revenue. Outside India, we distribute our fi lms
theatrically through our parent company, Eros International
Plc., through its own offi ces in Dubai, Singapore, the USA,
the UK, Australia and Fiji and other sub-distributors.
24 ANNUAL REPORT 2017-18
Overseas Distribution
In overseas markets, we distribute our fi lms through our
parent company, Eros International Plc. The global audience
comprises the South Asian diaspora as well as crossover
audiences who consume Indian fi lms subtitled or dubbed
in their local languages. Our global reach span’s more than
50 countries including the US, the UK, the entire Middle
East region, Germany, Poland, Russia, Romania, Indonesia,
Malaysia, Taiwan, Japan, South Korea, China. Our parent
also deploys digital distribution of our content, primarily in
IPTV, VOD (including SVOD and DTH) and online internet
channels.
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
Eros Now
Eros Now is our parent Eros International Plc’s premiere
OTT entertainment service under its digital arm- Eros Digital.
Eros Now is accessible worldwide to viewers across internet
enabled devices including mobile, web and TV. With 11,000+
digital titles that constitutes approximately 70% of the total
Indian movie content available for streaming on digital
platforms, Eros Now also has a bouquet of television shows,
music videos and audio tracks, making it a single destination
for unparalleled entertainment. While a majority of users are
from India, Eros Now has registered users in 135 different
countries.
Eros International Media Ltd. produces / acquires content for
Eros Now.
Library Monetization
The success of our fi lm distribution business lies in our ability
to acquire and develop content. We have been building and
adding to our fi lm library for the past 40 years and each
year, through acquisition and co-production arrangements,
we seek to acquire rights to 40-50 additional fi lms. We
currently own or have license rights over approximately 3,000
fi lms, including recent and classic titles that span different
genres, budgets andlanguages. Each year, we focus on co-
production, acquisition and distribution of a diverse portfolio
of Indian language and themed fi lms that we believe will have
a wide audience appeal.
We have the ability to combine our new release strategy with
our library monetization efforts to maximize our revenues.
Our extensive fi lm library provides us with a reliablesource of
recurring cash fl ow after the theatrical release period for a fi lm
has ended. In addition, because our fi lm library is large and
diversifi ed, we believe that we can more effectively leverage
our library in many circumstances by licensing not just single
fi lms but multiple fi lms. The existence of high margin library
monetization avenues especially in television and digital
platforms reduce reliance on theatrical revenues.
Our key competitive
strengths
Leading co-producer and acquirer
of new Indian fi lm content, with an
extensive fi lm library
Established, worldwide,
multi-channel distribution network
with strategic partnerships in China,
Russia and Turkey
Diversifi ed revenue streams and
pre-sale strategies mitigate risk
and promote stable cash fl ow
generation
Strong brand with fast
growing international reach
Strong and experienced
management team with
established relationships with
key industry participants.
EROS INTERNATIONAL MEDIA LIMITED 25
Cross-cultural Content
Appeal and Reach
Content and Distribution Tie-Ups
Though over a small base, our growth from non-diaspora
international markets has been picking pace continuously,
refl ecting a growing appetite for the content of the Indian
Film Industry in many new markets.
China
Turkey
One of our strongest potential markets, China, with a market
size of $ 6.2 billion and almost 41,000 screens is projected to
grow beyond 80,000 by FY2021, nearly twice the screen count
of the United States. Our memorandum of understanding
to collaborate with China Film Corp., Shanghai Film Group
Co. Ltd. and Fudan University Press Co. Ltd. to co-produce
and distribute Sino-Indian fi lms will be an important step in
maximizing our opportunity in China. Two projects will be co-
produced with a leading Chinese studio, based on stories
organically weaving the socio-cultural worlds of India and
China. Additionally, the fi lms will be shot simultaneously in
both Chinese and Hindi.
Original stories blending Indian and Turkish cultures will be
conceptualized and developed by our in-house writers along
with top Turkish writers. We are also partnering with Pana
Film, one of the largest Turkish fi lm studios for Indo-Turkish
co-productions.
Russia
Eros also has a distribution partnership with Central
Partnership in Russia, which has opened new markets for
Eros releases.
UAE
Eros also partnered with Phars Films, one of the UAE’s largest
fi lm distribution and exhibition networks.
These strategic partnerships not only help
Eros augment its in-house content production
model, but also expand the geographical
canvas for content monetization.
We entered the China market in fi scal year
2018 by releasing Bajrangi Bhaijaan across
more than 8,000 screens in March 2018.
The movie has grossed approximately
` 3 billion at the box offi ce.
26 ANNUAL REPORT 2017-18
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
EROS INTERNATIONAL MEDIA LIMITED 27
EROS INTERNATIONAL MEDIA LIMITED 27
Bolo Kya Dekhoge
Entertainment 24X7
Continuing its momentous run beyond FY2018, our OTT platform, Eros Now has been
scripting newer chapters in online streaming space of Indian fi lm and ancillary content.
Returning an overwhelming 276% growth in paying subscriber base in FY2018, Eros
Now crossed 10 million mark of paying subscribers in the fi rst quarter of FY2019. As of
June 30, 2018, Eros Now was catering to 113 million registered users and 10.1 million
paying subscribers worldwide with the promise of endless entertainment.
11,000+
Digital Rights
5,000+
Into Perpetuity
20+
Original Shows in
Production
Eros International Media Ltd. produces / acquires content for Eros Now.
28 ANNUAL REPORT 2017-18
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT
Adding fuel to its swelling brand salience, we launched a
high-intensity campaign, Bolo Kya Dekhoge. In April 2018,
Eros Now made its IPL debut in Season 11 as the title sponsor
of Virat Kohli captained team, Royal Challengers Bangalore
(RCB). Eros now entered into a partnership with Sri Lanka’s
leading service provider Dialog to give Sri Lankans best in
regional content with its vast content library.
Eros Now has inked strategic partnership deals with leading
telcos like Jio, Vodafone, Airtel and Idea Cellular and also
OEM brands. Eros Now has a large number of marketing
partnerships across lifestyle, FMCG, banking and technology
brands like State Bank of India (SBI), Gold’s Gym, Paytm,
Nature’s Basket, Voonik and Xiaomi. Eros Now’s recent
exclusive partnership with InMobi has opened avenues for
brands and advertisers to experience an end-to-end playbook
that spans innovative video and ad formats, dynamic
in-content placement of high-quality movies, and music
videos and originals across devices.
Eros Now is gearing up to launch a stable of feature fi lms,
made-for-digital originals fi lms and over 20 original episodic
programs, all of which will be available exclusively on Eros
Now to paying subscribers. Three original series, Side Hero,
Flip and Smoke are slated to be launched in the third quarter
of FY2019. Originals will feature popular names like Rohan
Sippy, Kunal Roy Kapoor, Rajat Kapoor, Siddharth Anand and
Pavan Kriplani in various capacities. Eros Now is confi dent
of breaching 16 million mark of paying subscribers by the
end of FY2019. This is expected to contribute signifi cantly
to revenue growth at Eros International Media Ltd. as it
produces and acquires content for Eros Now.
RAPID GROWTH IN PAYING SUBS (Million)
16+
2.1
2.9
3.7
7.9
5
Q4
FY2017
Q1
FY2018
Q2
FY2018
Q3
FY2018
Q4
FY2018
FY2019
Guidance
135
Countries
including India
10.1 mn
Paying
Subscribers
113 mn
Registered
Users
EROS INTERNATIONAL MEDIA LIMITED 29
As the Plot
Unfolds
Eros Group Evolution
Commenced business by
acquiring international IP
rights for Indian content
Adoption of vertically
integrated mode
Became the first Indian media
company to list on London
Stock Exchange
Launch of You Tube Channel
SVOD agreement with
Comcast
1977
1978
-
2005
2006
-
2008
Early adopter of VHS distribution
Established Global Distribution
network outside India
Launch of first digital Bollywood
TV network B4U
30 ANNUAL REPORT 2017-18
30 ANNUAL REPORT 2017-18
Eros Now official marketing launch
(July 2015)
Expanded distribution partnerships
in India and overseas
2009
-
2014
2015
-
2017
2018
Launched digital distribution
channel HBO and Eros Now
Announced Techzone Acquisition
Listed Eros International Media
Limited on the BSE and NSE
Listed Eros Plc on NYSE Euronext
Investment and Content Joint
Venture with Reliance Industries
Eros Now crosses 113M
registered users (June 2018)
EROS INTERNATIONAL MEDIA LIMITED 31
EROS INTERNATIONAL MEDIA LIMITED 31
CORPORATE OVERVIEW | MANAGEMENT REPORT | FINANCIAL MANAGEMENT Management Discussion and Analysis
The Indian economy has a promising outlook
The calendar year 2017 was a good year for the Indian economy. Retail inflation was the lowest in almost four
decades, the rupee strengthened against the US dollar for the first time in seven years and several reforms such
as the Goods and Services Tax (GST), recapitalization of banks and the Insolvency and Bankruptcy Code were
implemented.
In November 2017, backed by the potential of the reforms to strengthen the economy, Moody's Investor Service
upgraded India's sovereign credit ratings from Baa3 to Baa2 and changed the outlook from stable to positive. Going
forward, International Monetary Fund has projected that India will be the fastest growing economy in the world.
Driven by strong tailwinds of private consumption growth, the media and entertainment industry is expected to grow
well in the forthcoming years.
Real GDP growth (% )
7.8
6.4
5.1
3.5
6.8
6.7
4.6
3.6
2013
2014
2015
2016
2017
2018
People's Republic of China
Emerging market and developing economies
2019
India
8.2
5.8
5
3.8
2020
2021
2022
World
Source: IMF
The Media and Entertainment sector grew to ` 1.5 trillion
The Indian economy is growing and the growth in Media and Entertainment sector is a reflection of this. Favourable
demographics, a rise in consumer income, an ability to consume entertainment on multiple platforms and ‘on the go’
has created a huge propensity for the growth of Media and Entertainment industry in the country.
As per FICCI-EY Report 2018 edition, the Indian M&E sector reached ` 1.5 trillion (US$ 22.7 billion) in 2017, a growth
of almost 13% over 2016. With its current trajectory, it is expected to cross ` 2 trillion (US$ 31 billion) by 2020, at a
CAGR of 11.6%.
Segment
Filmed Entertainment
Television
Print
Digital Media
Animation and VFX
Live Events
Online gaming
Out of Home media
Radio
Music
Total
CY 2016
122
594
296
92
54
56
26
32
24
12
1,308
All figures are gross of taxes (` in billion)
CY 2017
156
660
303
119
67
65
30
34
26
13
1,473
CY 2018E
166
734
331
151
80
77
40
37
28
14
1,660
CY 2020E
192
862
369
224
114
109
68
43
34
18
2,032
CAGR 2016-20
11.9%
9.8%
5.7%
24.9%
20.4%
18.0%
27.5%
7.7%
8.6%
10.6%
11.6%
Indian Film Industry grew by 27% in CY2017
The robust growth was on the back of box office growth - both domestic and international - coupled with
increased revenues from sale of satellite and digital rights. All sub-segments, with the exception of home video
grew and the film segment reached ` 156 billion in 2017. The overseas box office growth was driven by the
surging popularity of the Bollywood films in the China market.
DoMESTIC ThEATRICAlS
Content Consumption trends
Hindi films comprise the majority component of the Indian film segment. They contribute almost 40% of the domestic
box office collections annually, despite comprising only 17% of the films released. Films in 29 other Indian languages
32 AnnuAl RepoRt 2017-18
Management Discussion and Analysis account for approximately 75% of the films released and they contribute
approximately 50% to the annual domestic box office collections.
Hollywood and international films comprise the balance.
Revenues
2016
2017
2018E
2020E
Domestic theatricals
85.6
96.3
103.0
118.0
Overseas theatricals
Broadcast rights
Digital /OTT rights
In-cinema advertising
Home Video
Total
8.5
16.0
6.0
5.9
0.4
25.0
19.0
8.5
6.4
0.3
25.0
20.0
10.0
7.5
0.2
28.0
22.0
14.5
9.0
0.2
122.4
155.5
165.7
191.7
612
(Gross of taxes, ` billion)
Despite producing the most number of films in a year, India stands as
one of the most highly underpenetrated markets among major countries
with 8 screens per million of population. This is primarily due to lack
of penetration of cinema exhibition players in Tier-II, Tier-Ill and Tier-IV
markets, hence leaving a large market with limited screen presence.
However, the next wave of growth at multiplexes is expected to come
by means of organic expansion in semi-urban areas. This is after
opportunities for consolidation that led to a series of acquisitions and
consolidation of screen counts in the high spending urban markets are
mostly exhausted and therefore, deeper penetration in the semi-urban
markets will be witnessed in the coming years.
Number of screens for top 4 multiplex chains in 2017
Relatable and niche content driving success at box office
Trends of 2017 re-iterated that content was king and it was the
story, above everything else, that made a film successful. Save a
few exceptions, in 2017, cohesive story telling took precedence
over mindless cinema. From Shubh Mangal Savdhan to Newton,
content-backed cinema triumphed over ‘formula’ films displaying
the changing tastes and growing maturity of the audiences as
they embrace a wide variety of themes and experiences. The
year also strengthened the trend of filmmakers shifting locations
to the hinterland to contextualize their stories in Tier-II and
Tier-III towns, which added depth and familiarity to the script and
characters. This trend reflected the lives of the majority of middle-
class audiences who unarguably enjoyed, but could never really
connect to, the glitz and glamour of big cities. The year also saw
success of cinema not driven solely by stars but by content delivered
by competent actors.
Regional
One major trend in the regional cinema has been the increased
consumption of dubbed films. The spectacular success of Baahubali 2:
The Conclusion, a Tamil-Telugu bilingual dubbed in Hindi, took regional
cinema to new heights in 2017. Tamil and Telugu cinema remains the
mainstay of the regional cinema. The segment also benefitted from
remake rights value as well as increased consumption of its dubbed films
on Hindi film channels as well in the cinemas. 2017 was a very successful
year for the Malayalam films with the satellite revenues being a healthy
contributor. Bengali and Marathi films that are known for their content
also have shown a potential for appealing to wider audiences with a
Bengali film, Amazon Obhijaan setting a trend by being dubbed in five
languages; Hindi, Tamil, Telugu, Oriya, and Assamese. Going one step
forward, Eros International Media is leading this trend with an elephant
film that is going to be shot simultaneously in the 3 largest film languages;
Hindi, Telugu and Tamil. With the production and print and advertising
costs being relatively low, the Regional cinema offers an attractive ROI
opportunity for film studios that have developed trustworthy relationships
and capabilities in regional cinema.
India is an under-screened market
Screens per million of population
488
450
315
PVR Cinemas
INOX Leisure
Carnival Cinemas
Cinepolis
Source: Industry annual reports
overseas theatricals segment growing strongly
Overseas theatricals contributed approximately 16% to the overall
segment’s revenue in 2017 and have emerged as a fast growing
revenue stream for film studios. Apart from the growing international
appeal of the Indian films globally, the main reason for this is the rising
popularity of Bollywood content in the China market.
The Aamir Khan-starring film Dangal became the highest grossing
non-Hollywood film in China ever with earnings amounting to US$
169 million. Similarly, Bajrangi Bhaijaan which released almost 2
years after its release in India grossed an impressive US$ 50 million
which was almost in line with its India box office numbers. This
is noteworthy as China wasn't considered part of the ‘traditional’
foreign market for Indian films-which includes regions such as the
North America, United Kingdom, Middle East, South East Asia which
have a strong presence of the South Asian diaspora. Overall, leading
Studios such as Eros International now release content in over
50 countries globally and in over 27 dubbed or sub-titled languages
pointing to the growing global appeal of India content. Even as Indian
economy is getting better integrated across the world, Indian content
is attracting crossover audiences in markets such as Germany, Japan,
South America and many others which have a limited presence of the
diaspora audience.
TV viewing households grew to 183 million
125
Of the estimated 286 million households in India, TV penetration
reached 64% taking the total number of TV viewing household to 183
million in 2017, which is a 3.5% growth over 2016. This accounted for
approximately 780 million viewers. 83% of the total TV households were
paying households.
60
40
8
10
16
India
Brazil
China
South Korea
UK
US
Source: Industry annual reports
Cable
DTH
HITS
Free TV
Total
2016
100.5
49
0.5
26
176
2017
98.5
52
1.5
31
183
(Television households in million)
eRoS InteRnAtIonAl MedIA lIMIted 33
Corporate overview | ManageMent report | finanCial management More than a third of the total television viewership is generated by films.
Film channels and GEC's are the main buyers for Broadcast rights.
Broadcast rights grew to ` 19 billion in 2017 from ` 16 billion in 2016, a
growth rate of 18.7%.
Film content has also helped to grow the advertising revenues for
major broadcasters due to the launch of Free dish channels namely;
Star Utsav Movies, Zee Anmol Cinema, Sony Wah and Viacom’s
Cineplex. The pricing of the TV rights have remained firm as these
channels use film content to penetrate into the rural households
where films enjoy a very wide viewership and star appeal.
other Film segment trends
1. More films turned profitable
Of the leading 50 Hindi films, the number of films which were able
to record a positive return of more than 100% over their investment
increased from 8 in 2016 to 14 in 2017. However, a few films with
big stars and big budgets failed to generate the profits despite being
among the top grossers for the year, suggesting good box office
performance is not a guarantee for returns. On the other hand, many
middle and smaller budget films delivered good profitability.
2. Digital and events increased their importance in the
The rapid adoption of connected devices, especially smartphones and
tablets, is instrumental in media consumption shifting beyond traditional
media formats such as broadcast and cable TV toward digital mediums
with the time availability for media consumption sky rocketing due to the
ability to consume it ‘on the go’.
Subscriber base of mobile users increased
As per Telecom Regulatory Authority of India (TRAI) there were
over 1.2 billion wireless subscribers in India at the end of February
2018. The number of wireless internet users in India is likely to reach
829 million by 2021. The adoption of 4G is gradually increasing and
now 3G and 4G constitute over 75% of the overall wireless internet
user base. Initiatives such as broadband rollout and public Wi-Fi as
part of the government’s Digital India campaign and the promotion of
4G data packs by leading telecoms will only help boost the quality of
digital infrastructure in India.
India has the second largest online video audience
At 250 million, India has the second largest online audience (behind
China) which is expected to reach ~500 million by 2020, a 2x growth
driven by rapidly increasing mobile penetration, increasing Internet
speeds, advent of 4G and falling data charges.
marketing mix
low-cost smartphone options increased
A film's promotion budget is highest on television but is growing
significantly in digital and to some extent on print and radio with
activation and outdoor comprising of the balance. Digital and social
media is playing a growing role due to its wide outreach amongst
the target audiences and cost effectiveness, making a departure
from a 'single-event' launch or press interaction to an entire
campaign spanning weeks or months. Core innovations in film
marketing today include word of mouth screenings, co-branding,
digital alliances, in-film integrations, promotional events with cast
and crew involvement, social media, trailer launches in cinemas
apart from the mass media usage.
3. Collaborations with foreign studios are increasing
India is witnessing a rise in collaborations between Indian
production houses and foreign studios. Eros International has been
leading this development with China’s Huaxia Film Distribution Co
Ltd and Peacock Mountain Culture & Media to co-produce Sino
– Indian films. These include Kabir Khan’s travel drama The Zoo
Keeper and Siddharth Anand’s cross-cultural romantic comedy
Love in Beijing which are in development and pre-production and
which require local approval from the China film bodies to qualify as
local films.
4.
Small-budget different themed films are going mainstream
The past few years witnessed many small budget, niche films
with high-quality scripts made a mark in with hits Shubh Mangal
Savdhaan, Newton, Neerja and Hindi Medium posting significant
revenues despite low to modest star appeal.
Music
The size of the music industry based on music labels revenues was
approximately ` 9.2 billion in 2017. Sale of digital music accounts for
about 65% of the overall music sales in India. Further, in the music
industry, songs related to movies accounts for about 80% of the music
revenues.
Digital rights are getting more valuable
The advent of large OTT platforms in India such as Netflix, Amazon, Jio
Cinema, etc, apart from OTT offerings of various telecom companies and
broadcasters, has significantly increased the demand for films' digital
rights. This has increased the library value of players such as Eros Now
who has the largest Indian language movie content library worldwide
with over 11,000 digital titles, out of which approximately 5,000 films
are owned in perpetuity. We expect this value to continue to be high in
the near future, as demand for content continues to rise on the back of
growing smart phone and broadband user base.
One of the key events of 2017 was the launch of low-cost smartphones.
Jio launched its ` 1,500 smartphone, and Airtel announced a smartphone
priced around ` 2,000-2,500.These devices come with bundled data
plans, as well as Wi-Fi connectivity, and will enable deeper penetration of
internet services and digital media.
CoMPANY oVERVIEW
Eros International Media Limited (Eros International) is a leading global
Company in the Indian filmed Entertainment Industry which co-produces,
acquires and distributes Indian language films in multiple formats
worldwide. Our success is built on the relationships we have cultivated
over the past 40 years with leading talent, production companies,
exhibitors and other key participants in our industry. Leveraging these
relationships, we have aggregated rights to over 2,000 films in our library,
including recent and classic titles that span different genres, budgets
and languages, and we have distributed a portfolio of over 125+ new
films over the last three completed fiscal years. Film distribution across
theatrical, overseas and television and others channels along with library
monetization provide us with diversified revenue streams. Furthermore,
Eros International Media Limited and Reliance Industries Limited have
partnered in India to jointly produce and consolidate content from across
India. The parties will equally invest up to ` 10 billion to produce and
acquire Indian films and digital originals across all languages.
The Group has largest distribution network for Indian films worldwide.
The distribution network spans over 50 countries, with offices in India,
the UK, North America, United Arab Emirates, Australia, Fiji, Isle of Man
and Singapore.
STRATEGIC oVERVIEW
•
•
•
•
Scaling up productions and co-productions including developing
our own intellectual properties in-house and through our Joint
venture company, Colour Yellow Productions Pictures, to release
high quality content globally and augment our content library.
In partnership with Reliance Industries Limited, jointly produce
and consolidate content from across India. The parties will equally
invest up to ` 10 billion to produce and acquire Indian films and
digital originals across all languages.
Creation of never seen before digital content for Eros Now, our
parent Eros International Plc’s OTT digital entertainment service
and evolve it as the preferred choice for online entertainment by
consumers across digital platforms.
Expand our regional language content offerings to include films in
more regional languages.
34 AnnuAl RepoRt 2017-18
Management Discussion and Analysis
•
•
Foray into international co-productions with promising markets
such as China, Russia and Turkey
Broaden the avenues for monetization of the Company content
through existing and evolving revenue streams.
hUMAN RESoURCES
Within our strategic roadmap, we had 5 distinct themes that guided our
actions. Position human Resources to support senior leadership in
executing on the priorities for the organization. Enhancing hR systems
& process solutions to serve our employees better while ensuring
accountability through policy and reporting. This through the introduction
of a newly launched HRMS (Human Resource Management System).
Maximizing efficiencies and effectiveness in business through process
standardization. Our quest to becoming Employers of choice with our
ability to retain, motivate, develop and continue to attract the best talent
market has to offer through a stringent promotion, Internal recruitment and
job rotation process. Our reward and recognition program forms a core
part of the exercise. In order to maintain market leader’s position of being
an attractive employer, the company has developed global guidelines on
diversity, equal rights and against discrimination. Employee relations &
listening post through an open door policy giving every employee the
right and opportunity to discuss any work related issues directly with the
management. In order for us to do so, we have aligned the workplace
layout and seating to foster the said culture.
CAUTIoNARY STATEMENTS
Statements in the Management Discussion and Analysis describing
the Company’s objectives, projections, estimates and expectations
may be ‘forward-looking statements’ within the meaning of applicable
securities, laws and regulations. Actual results could differ materially
from those expressed or implied. Important factors that could influence
the Company’s operations include economic developments within the
country, demand and supply conditions in the industry, input prices,
changes in Government regulations, tax laws and other factors such as
litigation and industrial relations.
eRoS InteRnAtIonAl MedIA lIMIted 35
Corporate overview | ManageMent report | finanCial management DIRECTORS’ REPORT
To,
The Members
Eros International Media Limited
Mumbai
Your Board of Directors are pleased to present 24th Annual Report of Eros International Media Limited (hereinafter referred to as “the Company”)
covering the business, operations and Audited Financial Statements of the Company for the financial year ended 31 March 2018.
1.
FINANCIAL RESULTS
The Financial Performance of your Company for the year ended 31 March 2018 is summarized below:
` in Lakhs
Standalone Year Ended
Consolidated Year Ended
Particulars
Sales and other Income
Profit before Tax
Less: Tax Expenses
Net Profit for the year from continuing operation
Profit for the year attributable to:
Equity shareholders of the Company
Non-controlling Interests
Other Comprehensive Income/(Loss) (net of taxes)
Total Comprehensive Income for the Year
Attributable to:
Equity Shareholders of the Company
Non-controlling Interests
EPS (Diluted) in `
2.
FINANCIAL PERFORMANCE
On a consolidated basis, the Company has recorded the revenues
of ` 101,001 Lakhs which was lower by 30.12% as compared to
previous year of ` 1,44,528 Lakhs. The profit before tax decreased by
10.82% to ` 28,735 Lakhs as compared to previous year of ` 32,223
Lakhs. The Profit After Tax attributable to equity shareholders was
` 22,934 Lakhs decreased by 10.92% as compared to previous year
of ` 25,745 Lakhs. Diluted EPS decreased by 11.41 % to ` 23.92 as
compared to previous year of ` 27.00.`
On a standalone basis, the Company has recorded the revenues
of ` 72,857 Lakhs which was lower by 37.44% as compared to
previous year of ` 1,16,466 Lakhs. The profit before tax decreased
by 33.45% to ` 14,043 Lakhs as compared to previous year of
` 21,100 Lakhs. The Profit After Tax at ` 7,701 Lakhs was lower by
40.94% as compared to previous year of ` 13,039 Lakhs. Diluted
EPS decreased by 41.30% to ` 8.03 as compared to previous year
of ` 13.68.
3. OPERATIONAL PERFORMANCE
the
2017-18,
Financial Year
During
your Company
released a total of 24 Films, of which 1 was high budget, 4 medium
budget and 19 low budget Films as compared to 44 Films released
in corresponding period last year, of which 5 were high budget, 10
medium budget and 29 low budget Films. Amongst the 24 Films
released during the financial year 2017-18, 14 were Hindi Films, 1
was Tamil/Telugu Film and 9 were other regional language Films.
Major releases for FY 2017-18 included: Sarkar 3 (Hindi),
Munna Michael (Hindi), Sniff (Hindi), Shubh Mangal Savdhaan
(Hindi), Newton (Hindi), Mukkabaaz (Hindi), Oru Kidayin Karunai
Manu (Tamil), Viswa Vikhyatharaya Payyanmar (Malayalam), Tujha
Tu Majha Mi (Marathi), Aamhi Doghi (Marathi), Aake (Kannada),
Posto (Bengali) and others.
36 AnnuAl RepoRt 2017-18
2017-18
72,857
14,043
6,342
7,701
-
-
56
7,757
-
-
8.03
2016-17
1,16,466
21,100
8,061
13,039
-
-
(22)
13,017
-
-
13.68
2017-18
1,01,001
28,735
5,613
23,122
22,934
188
51
23,173
23,207
(34)
23.92
2016-17
1,44,528
32,223
7,894
24,329
25,745
(1,416)
(460)
23,869
24,813
(944)
27.00
In the Financial Year 2018-19, we continue to be focused on
ramping up our own productions and co-productions through
key partnerships. These partnerships include our partnership
with talented producer-director, Aanand L Rai (Colour Yellow
Production) and our partnership with Reliance to equally invest
up to ` 1,000 Crores to produce and acquire Indian films
and digital originals across all languages. This investment will
dramatically scale Eros’ capabilities in content production,
marketing, and distribution.
Your Company’s key asset is a film library of over 2,000 films. In
an effort to reach a wide range of audiences, we maintain rights
to a diverse portfolio of films spanning various genres, generations
and languages. These include rights to films in Hindi and several
regional languages, Tamil, Telugu, Kannada, Marathi, Bengali,
Malayalam and Punjabi.
4. DIVIDEND
With a view to conserve resources and to strengthen the financial
position of the Company, your Directors did not recommend any
dividend to its shareholders for the financial year 2017-18.
The Dividend Distribution policy adopted by the Company in
terms of SEBI (Listing Obligations and Disclosures Requirements)
Regulations, 2015 (“SEBI Listing Regulations”) is uploaded on
the website of the Company at www.erosintl.com.
5. RESERVES
No percentage of profits was transferred to General Reserve as
dividend was not recommended for the financial year 2017-18.
6.
EMPLOYEES’ STOCK OPTION SCHEME & CHANGES IN
SHARE CAPITAL
During the year under review and in pursuance of the authority
granted by shareholders at the Annual General Meeting of the
Directors’ report
Company held on 28 September 2017, your Board had approved
the Eros International Media Limited - Employee Stock Option
Scheme 2017 (“EROS ESOP 2017”), which was prepared in
accordance with Companies Act, 2013 (the “Act”) and SEBI (Share
Based Employee Benefits) Regulations, 2014 read with necessary
circulars/notifications issued thereto for the issue and allotment of
grant of stock options to the employees of the Company as well as
to the employees of its holding and subsidiary companies. During
the financial year 2017-18, the Board of Directors of the Company,
on the recommendations of Nomination and Remuneration
Committee had granted an additional 8,64,014 stock options
to the employees of the Company and its subsidiary companies
under EROS ESOP 2017.
During the year under review, the Nomination and Remuneration
Committee of the Board had issued and allotted 11,13,160 Equity
Shares of the Company to employees of the Company and its
subsidiaries against exercise of equal number of stock options
pursuant to Eros Employee Stock Option Scheme 2009 (“EROS
ESOP 2009”). This resulted in increase in the Company’s Paid up
Share Capital to ` 94,97,18,770 as on 31 March 2018 as against
` 93,85,87,170 in the previous year.
The disclosures as required under Regulation 14 of SEBI
(Share Based Employee Benefits) Regulations, 2014
read
with SEBI Circular No. CIR/CFD/POLICY CELL/2/2015 dated
16 June 2015, is attached as Annexure A hereto and is also
available on website of the Company at www.erosintl.com.
A certificate from the Statutory Auditors certifying that both the
schemes viz. EROS ESOP 2009 and EROS ESOP 2017 has been
implemented in accordance with SEBI (Share Based Employee
Benefits) Regulations, 2014 and in accordance with the resolution(s)
passed by the shareholders would be placed at the Annual General
Meeting of the Company for inspection by the Members.
7.
SUBSIDIARY COMPANIES
On 1 October 2017, Copsale Limited (“Copsale”), a company
incorporated under the laws of British Virgin Island and the wholly-
owned subsidiary of the Company had disinvested its 51% stake
in Ayngaran International Limited, an Isle of Man company. With
the aforesaid disinvestment, following step down subsidiary
companies ceased to be the subsidiary of the Company:
a.
b.
c.
d.
e.
Ayngaran International Limited (Isle of Man),
Ayngaran International (UK) Limited, United Kingdom
Ayngaran International Mauritius Limited, Mauritius
Ayngaran International Media Private Limited, India
Ayngaran Anak Media Private Limited, India
As on 31 March 2018, the Company has Ten (10) subsidiaries.
There are no associate companies or joint venture companies
within the meaning of Section 2(6) of the Act. There has been no
material change in the nature of the business of the Company
and its subsidiaries. Pursuant to the provisions of Section 129(3)
of the Act, a statement containing salient features of the financial
statements of the Company’s subsidiaries, their performance and
financial position in the prescribed Form AOC-1 is annexed to this
Report as Annexure B.
None of the subsidiary companies except Copsale Limited (a British
Virgin Island Company) are material subsidiary in terms of Regulation
16(c) of the SEBI Listing Regulations and in accordance with
Company’s policy on “Determination of Material Subsidiaries”, which
is uploaded on the website of the Company at www.erosintl.com.
In accordance with Section 136 of the Act, the financial statements
of the subsidiary companies are available for inspection by
the members at the Corporate Office of the Company during
business hours on all days except Saturdays, Sundays and public
holidays between 11.00 a.m. to 1.00 p.m. upto the date of the
Annual General Meeting of the Company. Any member desirous
of obtaining a copy of the said financial statements may write to
the Company Secretary at the Corporate Office of the Company.
The financial statements including the consolidated financial
statements, financial statements of subsidiaries and all other
documents required to be attached to this report have been
uploaded on the website of the Company at www.erosintl.com.
8. BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL
The Board had re-designated Mr. Dhirendra Swarup as Chairman
and Non-Executive Independent Director of Company w.e.f.
11 August 2017 due to sudden demise of Mr. Naresh Chandra, the
Chairman and Non-Executive Independent Director of the Company
on 9 July 2017. The Company deeply mourn the irreparable loss
due to sudden demise of Late Mr. Naresh Chandra and places on
record its appreciation for the valuable contributions made by him
during his tenure as Director of the Company.
Mr. Subramaniam Lakshminarayanan was appointed as Non-
Executive Additional Independent Director on the Board of
the Company with effect from 14 November 2017 to hold
office up to the date of the ensuing Annual General Meeting
of the Company. The proposed resolution for appointment of
Mr. Subramaniam Lakshminarayanan as Non-Executive
Independent Director forms part of the Notice convening Annual
General Meeting. Your Board recommends his appointment.
Mr. Sunil Srivastav was appointed as Non-Executive Additional
Independent Director on the Board of the Company with
effect from 23 May 2018 to hold office up to the date of
the ensuing Annual General Meeting of the Company. The
proposed resolution for appointment of Mr. Sunil Srivastav as
Non-Executive Independent Director forms part of the Notice
convening Annual General Meeting. Your Board recommends
his appointment.
As per the provisions of the Act, Independent Directors have been
appointed for a period of Five (5) years and shall not be liable to
retire by rotation. All other Directors, except the Managing Director,
are liable to retire by rotation at the Annual General Meeting of the
Company.
Mr. Kishore Arjan Lulla was re-appointed as an Executive Director,
liable to retire by rotation for a period of Five (5) years commencing
from 1 November 2017 to 31 October 2022 at the last Annual
General Meeting held on 28 September 2017.
In accordance with the provisions of Section 152 of the
Act read with Companies
(Management & Administration)
Rules, 2014 and Articles of Association of the Company,
1Mrs. Jyoti Deshpande, Non-Executive Non
Independent
Director of the Company retires by rotation at the ensuing
Annual General Meeting and being eligible, offer herself for
re-appointment. Your Board recommends her appointment.
The brief details of the Directors proposed to be reappointed
as required under Secretarial Standard 2 issued by the Institute
of Company Secretaries of India and Regulation 36 of the SEBI
Listing Regulations is provided in the Notice convening Annual
General Meeting of the Company.
All the Directors of the Company have confirmed that they are not
disqualified to act as Director in terms of Section 164 of the Act.
of
203
compliance
In
Act,
Section
Mr. Abhishekh Kanoi was appointed as Vice President -
Company Secretary and Compliance Officer and Whole Time
Key Managerial Personnel of the Company w.e.f. 15 December
2017 in place of Mrs. Dimple Mehta who has resigned at the
close of business hours on 14 December 2017.
the
of
Further, Mr. Farokh P. Gandhi was appointed as a Chief Financial
Officer and Whole Time Key Managerial Personnel of the Company
w.e.f. 9 March 2018 in place of Mr. Dinesh Modi who has resigned at
the close of business hours on 8 March 2018.
1Designation of Mrs. Jyoti Deshpande was changed from Executive Director to Non-Executive Non-Independent Director of the Company w.e.f. 1 April 2018.
eRoS InteRnAtIonAl MedIA lIMIted 37
Corporate overview | ManageMent report | finanCial management
The Board places on record its appreciation for the valuable
contribution made by Mrs. Dimple Mehta and Mr. Dinesh Modi
during their tenure with the Company.
178 of the Act and Regulation 19 of the SEBI Listing Regulations
(including any statutory modification(s) or re-enactment(s) thereof
for the time being in force).
Declaration of Independence by Independent Directors &
adherence to the Company’s Code of Conduct for Independent
Directors
All the Independent Directors of the Company have submitted their
disclosure to the effect that they fulfill all the requirements/criteria
of independence as per Section 149(6) of the Act. Further, all the
Independent Directors have affirmed that they have adhered and
complied with the Company’s Code of Conduct for Independent
Directors which is framed in accordance with Schedule IV of the Act.
Meetings conducted during the Year
The Board met Four (4) times during the financial year
under review, the details of which are given in the Corporate
Governance Report that forms part of this Report. The
intervening gap between any Two (2) meetings of the Board
was not more than One Hundred and Twenty (120) days as
stipulated under the Act and SEBI Listing Regulations.
Constitution of various Committees
The Company’s policy on directors’ appointment and remuneration
and other matters as provided in Section 178(3) of the Act has
been disclosed in the Corporate Governance Report, which forms
part of this Report.
A detailed statement of disclosure required to be made in
accordance with the Nomination and Remuneration Policy of the
Company, disclosures as per the Act and applicable Rules thereto
is attached as Annexure C hereto and forms part of this Report.
9. AUDITORS & AUDITORS’ REPORT
M/s. Walker Chandiok & Co LLP, Chartered Accountants, (Firm
Registration No. 001076N/N500013) Statutory Auditors of the
Company retired at the conclusion of the Annual General Meeting
held on 28 September 2017 as per the provision of Section 139
of the Act and M/s. Chaturvedi & Shah, (Firm Registration No.
101720W) were appointed as Statutory Auditors of the Company
at the Annual General Meeting held on 28 September 2017 for
the term of Five (5) years till the conclusion of 28th Annual General
Meeting, to be held in the year 2022.
The Board of Directors of the Company has constituted following
Committees:
Auditors’ Report
a. Audit Committee
b. Nomination and Remuneration Committee
c. Stakeholders Relationship Committee
d. Corporate Social Responsibility Committee
e. Management Committee
Details of each of the Committees stating their respective
composition, terms of reference and others are uploaded on our
website at www.erosintl.com and are stated in brief in the Corporate
Governance Report attached to and forming part of this Report.
Annual Evaluation of Board, Committees and Individual
Directors
The Company has devised a Policy for performance evaluation of
the Board, Committees and other individual Directors (including
Independent Directors) which includes criteria for performance
evaluation of the Non-Executive Directors and Executive Directors.
The evaluation process inter alia considers attendance of Directors
at Board and Committee Meetings, acquaintance with business,
communicating inter se Board Members, effective participation,
domain knowledge, compliance with code of conduct, vision and
strategy, benchmarks established by global peers, etc., which is in
compliance with applicable laws, regulations and guidelines.
The Board carried out annual performance evaluation of the Board, its
Committees and Individual Directors and Chairperson. The Chairman
of the respective Board Committees shared the report on evaluation
with the respective Committee Members. The performance of
each Committee was evaluated by the Board, based on report on
evaluation received from respective Board Committees. The reports
on performance evaluation of the Individual Directors were reviewed
by the Chairman of the Board.
There are no qualifications, adverse remarks reservations or
disclaimer made by M/s. Chaturvedi & Shah, Statutory Auditors,
in their report for the financial year ended 31 March 2018. The
notes to the Accounts referred to in the Auditor’s Report are
self-explanatory and therefore do not call for any further explanation
and comments.
Pursuant to provisions of Section 143(12) of the Act, the Statutory
Auditors have not reported any incidence of fraud to the Audit
Committee during the year under review.
10. SECRETARIAL AUDITORS’ AND ITS REPORT
to
the Companies
the provisions of Section 204 of
the Act
Pursuant
and
(Appointment and Remuneration of
Managerial Personnel) Rules, 2014, the Board has appointed
M/s. Makarand M. Joshi & Co., a firm of Company Secretaries
in Practice to undertake the Secretarial Audit of the Company for
the financial year 2017-18. The Secretarial Audit Report for the
financial year ended 31 March 2018 in the prescribed Form MR-3
is annexed herewith as Annexure D to this Report, which is self-
explanatory. The Secretarial Audit Report does not contain any
qualification, reservation, adverse remark or disclaimer.
11. CREDIT RATING
During the year review, the ratings for various facilities/instruments
were revised/reaffirmed by CARE Ratings Limited as under:
Sl.
No.
1
2
Facilities
Rating
Long Term
Facilities
Short Term
Facilities
CARE BBB+; Stable [Triple B Plus;
Outlook: Stable]
CARE A3+ [A Three Plus]
Familiarization Programme
during the year
for
Independent Directors
12. PARTICULARS OF EMPLOYEES
The requisite disclosures in terms of the provisions of Section 197
of the Act read with Rule 5 of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 along with
statement showing names and other particulars of employees
drawing remuneration in excess of the limits prescribed under the
said Rules is annexed to this Report as Annexure E.
Familiarization Programme for Independent Directors is mentioned
at length in Corporate Governance Report attached to this Report
and the details of the same have also been disclosed on the
website of the Company at www.erosintl.com.
Policy on appointment and remuneration and other details
of directors
The remuneration paid to the Directors is in line with the Nomination
and Remuneration Policy formulated in accordance with Section
38 AnnuAl RepoRt 2017-18
Directors’ report
13. LOANS, GUARANTEES OR INVESTMENTS BY THE COMPANY
Particulars of loans, guarantees and investments made by the
Company as required under Section 186(4) of the Act and the
SEBI Listing Regulations are contained in Notes to the Standalone
Financial Statements of the Company forming part of this Annual
Report.
Companies (Management & Administration) Rules, 2014 is
annexed as Annexure G to this Report.
18.
INSURANCE
All the insurable interests of your Company including properties,
equipment, stocks etc. are adequately insured.
14. RELATED PARTY TRANSACTIONS
19. DEPOSITS, LOANS AND ADVANCES
In line with the requirements of the Act and SEBI Listing
Regulations, your Company has formulated policy on Related
Party Transactions duly approved by the Board, which is also
available on the Company’s website at www.erosintl.com. The
Policy intends to ensure that proper reporting, approval and
disclosure processes are in place for all transactions between
the Company and related parties.
All contracts/arrangements/transactions entered by the Company
during the financial year with related parties were on an arm’s length
basis, in the ordinary course of business and in compliance with the
applicable provisions of the Act and SEBI Listing Regulations. Prior
omnibus approval had been obtained for the transaction which are
of a foreseeable and repetitive in nature and such transactions are
reported on a quarterly basis for review by the Audit Committee as
well as the Board.
Pursuant to Section 134 of the Act read with Rule 8(2) of the
Companies (Accounts) Rules, 2014, the particulars of contracts/
arrangements/transactions entered into with related parties during
the financial year 2017-18 in terms of Section 188(1) of the Act and
applicable Rules made thereunder, is attached to this Report in the
prescribed Form AOC-2 as Annexure F.
All other contracts/arrangements/transactions with related parties,
are in the ordinary course of business and at arm’s length basis
and stated in Notes to Accounts to the Financial Statements of the
Company forming part of this Annual Report.
15. VIGIL MECHANISM
The Company promotes ethical behavior in all its business
activities and your Company has adopted a Policy on Vigil
Mechanism and Whistle Blower in terms of Section 177(9)
and Section 177(10) of the Act and Regulation 22 of the SEBI
Listing Regulations for receiving and redressing complaints from
employees, directors and other stakeholders to report concerns
about unethical behaviour, actual or suspected fraud.
The Policy is appropriately communicated within the Company
across all levels and has been displayed on the Company’s
intranet for its employees and website at www.erosintl.com for
stakeholders.
Protected disclosures are made by a whistle blower in writing to
the Ombudsman on Email-ID at whistleblower@erosintl.com and
under the said mechanism, no person has been denied direct
access to the Chairperson of the Audit Committee. The Audit
Committee and Stakeholders Relationship Committee periodically
reviews the functioning of this Mechanism.
16. PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL
HARASSMENT AT WORKPLACE
The Company has adopted Sexual Harassment Policy of Women
at workplace, which commits to provide a workplace that is free
from all forms of discrimination, including sexual harassment.
All employees (permanent, contractual, temporary, trainees) are
covered under the Policy. Further, the Company has constituted
an Internal Complaints Committee, where employees can register
their complaints against sexual harassment.
During the year under review, the Company has not received any
complaints on sexual harassment.
17. EXTRACT OF THE ANNUAL RETURN
The extract of Annual Return
the prescribed Form
MGT-9 as required under Section 92(3) of the Act read with
in
Your Company has not accepted any public deposit under Chapter
V of the Act. The details of loans and advances, which are required
to be disclosed in the Company’s audited annual accounts,
pursuant to Schedule IV of SEBI Listing Regulations, are mentioned
in Notes to Accounts, forming a part of this Annual Report.
20. DIRECTORS’ RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the
information and explanations obtained, in terms of Section 134 of
the Act, your Directors confirms that:
a.
b.
c.
d.
e.
f.
in the preparation of the annual accounts for the financial year
ended 31 March 2018, the applicable Accounting Standards
read with the requirements set out under Schedule III to the
Act, have been followed and there are no material departures
from the same;
judgments and estimates made
such accounting policies have been selected and applied
that
consistently and
are reasonable and prudent so as to give a true and
fair view of the state of affairs of the Company as at
31 March 2018 and of the profit of the Company for the year
ended on that date;
proper and sufficient care has been taken for the maintenance
of adequate accounting records in accordance with the
provisions of the Act, for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
the annual accounts have been prepared on a ‘going
concern’ basis;
internal financial controls were followed by the Company
and such internal financial controls are adequate and are
operating effectively; and
proper systems have been devised to ensure compliance
with the provisions of all applicable laws and such systems
are adequate and operating effectively.
21. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION,
FOREIGN EXCHANGE
Your Company is into the business of production, co-production,
acquisitions, marketing and distributions of cinematograph films.
Since this business does not involve any manufacturing activity,
the information required to be provided under Section 134(3)(m)
of the Act read with the Companies (Accounts) Rules, 2014, are
not applicable to the Company. However, the Company has been
continuously and extensively using technology in its business
operations.
The particulars of foreign currency earnings and outgo are as
under:
Particulars
` in Lakhs
Year ended
31 March 2018
Year ended
31 March 2017
Expenditure in foreign currency
Earnings in foreign currency
CIF Value of Imports
372
11,014
NIL
149
37,520
1,960
22.
INTERNAL FINANCIAL CONTROLS
The Company maintains adequate and effective internal control
systems which are commensurate with the nature, size and
complexity of its business and ensure orderly and efficient
eRoS InteRnAtIonAl MedIA lIMIted 39
Corporate overview | ManageMent report | finanCial management
conduct of the business. The internal control systems of the
Company are routinely tested and verified by our Internal Auditor,
M/s. KPMG, Chartered Accountants and significant audit
observations and follow-up actions are reported to the Audit
Committee. The Audit Committee reviews the adequacy and
effectiveness of the Company’s internal control requirement and
monitors the implementation of audit recommendations.
23. CORPORATE GOVERNANCE
In order to maximize shareholder value on a sustained basis, your
Company has been constantly reassessing and benchmarking
itself with well-established Corporate Governance practices
besides strictly complying with the requirements of the SEBI Listing
Regulations and applicable provisions of the Act.
In terms of Schedule V of SEBI Listing Regulations, a detailed
report on Corporate Governance along with Compliance Certificate
issued by the Secretarial Auditor of the Company is attached and
forms an integral part of this Annual Report.
24. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of Regulation 34(2)(e) and Schedule V of the SEBI Listing
Regulations, Management Discussion and Analysis Report is
presented in separate sections forming part of this Annual Report.
25. CORPORATE SOCIAL RESPONSIBILTY
The disclosures on Corporate Social Responsibility activities,
as required under Rule 9 of the Companies (Corporate Social
Responsibility Policy) Rules, 2014, are reported in Annexure H
forming part of this Report and is also available on the website of
the Company at www.erosintl.com.
assessment while also placing significant focus on constantly
identifying and mitigating risks within the business. Further details
on the Company’s risk management framework is provided in the
Management Discussion and Analysis Report.
28. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE
FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments, affecting
the financial position of the Company which have occurred
between the end of the financial year of the Company to which the
financial statements relate and till the date of this Report.
29. DETAILS OF SIGNIFICANT/MATERIAL ORDERS PASSED BY
THE REGULATORS/COURTS
There have been no significant and material orders passed by the
Regulators or Courts or Tribunals impacting the going concern
status and Company’s operations in future.
30. OTHER DISCLOSURES
•
•
•
During the year under review, the Company has not accepted
any deposit within the meaning of Sections 73 and 74 of
the Act read with the Companies (Acceptance of Deposits)
Rules, 2014 (including any statutory modification(s) or
re-enactment(s) thereof for the time being in force);
The Company has complied with Secretarial Standards
issued by the Institute of Company Secretaries of India on
Board and General Meetings;
The Company has not issued equity shares with differential
rights as to dividend, voting or otherwise.
26. BUSINESS RESPONSIBILITY REPORT
31. ACKNOWLEDGMENTS
As per Regulation 34 of the SEBI Listing Regulations, the Company
has included in its Annual Report, a Business Responsibility Report
describing initiatives taken by the Company from an environmental,
social and governance perspective. Accordingly, the Business
Responsibility Report is attached herewith as Annexure I.
27. RISK MANAGEMENT
The Company has in place a Risk Management Policy to identify
the element of risk for achieving its business objective and to
provide reasonable assurance that all the material risks will be
mitigated. The Audit Committee of the Board has been vested with
powers and functions relating to Risk Management, which inter
alia includes (a) review of risk management policies and business
processes to ensure that the business processes adopted and
transactions entered into by the Company are designed to identify
and mitigate potential risk; (b) laying down procedures relating to
Risk assessment and minimization.
The objective of the risk management framework is to enable and
support achievement of business objectives through risk intelligent
The Board of Directors take this opportunity to express their
sincere appreciation for support and co-operation from the Banks,
Financial Institutions, Shareholders, Vendors, Customers and all
other business associates.
Your Directors sincerely appreciate
the high degree of
professionalism, commitment and dedication displayed by the
employees at all levels. Your Directors also wish to place on record
their gratitude to all the stakeholders for their continued support
and confidence.
For and on behalf of the Board of Directors
Eros International Media Limited
Sd/-
Sunil Arjan Lulla
DIN: 00243191
Executive Vice Chairman &
Managing Director
Date: 23 May 2018
Place: Mumbai
Sd/-
Sunil Srivastav
DIN: 00237561
Non-Executive Independent
Director
40 AnnuAl RepoRt 2017-18
Directors’ report
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eRoS InteRnAtIonAl MedIA lIMIted 41
Corporate overview | ManageMent report | finanCial management
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Directors’ report
Annexure C
Information required under Section 197 of the Companies Act, 2013, read with The Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014
A. Ratio of remuneration of each Director to the median remuneration of the employees of the Company for the financial year 2017-18
is as follows:
Name of Director
Mr. Naresh Chandra*
Mr. Dhirendra Swarup
Mr. Rakesh Sood
Mr. Sunil Arjan Lulla
Mr. Kishore Arjan Lulla
Mrs. Jyoti Deshpande
Mr. S. Lakshminarayanan**
Notes:
1. The above information is on standalone basis.
Total Remuneration
(Amt in `)
Ratio of remuneration of director to the
Median Remuneration
15,23,014
55,56,209
35,77,113
4,37,57,064
1,27,55,244
7,14,45,672
11,73,664
2.65
9.66
6.22
76.10
22.18
124.25
2.04
2. The aforesaid details are calculated on the basis of remuneration for the financial year 2017-18.
3. The remuneration to Directors includes sitting fees paid to them for the financial year 2017-18.
* On sudden demise of Mr. Naresh Chandra, he ceased to be the director of the Company w.e.f. 9 July 2017
** Mr. S. Lakshminarayanan was appointed as an Non Executive Additional Independent Director on 14 November 2017
B. Percentage increase in reumeration of each Director, Chief Financial Officer and Company Secretary in the financial year 2017-18
are as follows:
Name of Director
Designation
Remuneration (in `)
Increase in %
Mr. Naresh Chandra*
Mr. Dhirendra Swarup
Mr. Rakesh Sood
Mr. Sunil Arjan Lulla
Mr. Kishore Arjan Lulla
Non Executive Independent Director
Non Executive Independent Director
Non Executive Independent Director
Executive Vice Chairman & Managing Director
Executive Director
2017-18
15,23,014
55,56,209
35,77,113
4,37,57,064
1,27,55,244
2016-17
56,95,000
32,07,500
32,07,500
4,63,33,880
1,15,95,672
Mrs. Jyoti Deshpande**
Mr. S. Lakshminarayanan***
Mr. Dinesh Modi****
Mrs. Dimple Mehta****
Mr. Farokh P Gandhi****
Mr. Abhishekh Kanoi****
* On sudden demise of Mr. Naresh Chandra, he ceased to be the director of the Company w.e.f. 9 July 2017.
Executive Director
Non Executive Additional Independent Director
Group Chief Financial Officer (India)
Vice President - Company Secretary & Compliance Officer
Chief Financial Officer
Vice President - Company Secretary & Compliance Officer
7,14,45,672
11,73,664
2,20,30,954
52,67,035
4,82,258
13,88,093
1,05,41,520
-
93,00,000
50,08,211
-
-
(73.26)
73.23
11.52
(5.56)
10.00
577.75
-
136.89
5.17
-
-
** The designation of Mrs. Jyoti Deshpande has been changed from Executive Director to Non-Executive Non-Independent Director of the
Company w.e.f. 1 April 2018.
*** Mr. S. Lakshminarayanan was appointed as an Non Executive Additional Independent Director on 14 November 2017.
****Mr. Dinesh Modi, Group Chief Financial Officer (India) and Mrs. Dimple Mehta, VP-Company Secretary & Compliance Officer of
the Company resigned w.e.f. 8 March 2018 and 14 December 2017 respectively. Mr. Farokh P. Gandhi was appointed as Chief
Financial Officer and Mr. Abhishekh Kanoi was appointed as VP-Company Secretary & Compliance Officer w.e.f. 9 March 2018 and
15 December 2017 respectively.
C. Percentage increase in the median remuneration of employees in the financial year 2017-18:
Particulars
2017-18
Amt in `
2016-17
Amt in `
% Change
Median Remuneration of all employees per annum
5,75,016
5,68,950
(1.07)
D. Number of permanent employees on the rolls of the Company as on 31 March, 2018 :
As on 31 March 2018, the Company has 285 permanent employees on its payroll, as compared to 294 employees as at 31 March 2017.
eRoS InteRnAtIonAl MedIA lIMIted 45
Corporate overview | ManageMent report | finanCial management E. Comparison of average percentile increase in salary of employees other than the key managerial personnel and the
percentage increase in the key managerial remuneration:
Particulars
Average salary of all employees (other than Key
Managerial Personnel)
F. Affirmation:
2017-18
Amt in `
2016-17
Amt in `
% Change
3,32,60,958
3,53,37,973
(5.88)
Pursuant to Rule 5(1)(xii) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company hereby affirms
that the remuneration paid is as per the Remuneration Policy for Directors, Key Managerial Personnel and other Employees.
46 AnnuAl RepoRt 2017-18
Directors’ report
Annexure D
FORM NO. MR.3
SECRETARIAL AUDIT REPORT
For the Financial Year Ended 31 March 2018
[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule 9 of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014]
To,
The Members,
M/s. Eros International Media Limited
201, Kailash Plaza, Opp. Laxmi Industrial Estate,
Off. Andheri Link Road, Andheri West,
Mumbai - 400053, Maharashtra (India).
We have conducted the secretarial audit of the compliance of
applicable statutory provisions and the adherence to good corporate
practices by Eros International Media Limited (hereinafter called the
“Company”). Secretarial Audit was conducted in a manner that provided
us a reasonable basis for evaluating the corporate conducts/statutory
compliances and expressing my opinion thereon.
Based on our verification of the Company’s books, papers, minute books,
forms and returns filed and other records maintained by the Company
and also the information provided by the Company, its officers, agents
and authorized representatives during the conduct of secretarial audit, We
hereby report that in our opinion, the Company has, during the audit period
covering the financial year ended on 31 March 2018 (‘Audit Period’)
complied with the statutory provisions listed hereunder and also that the
Company has proper Board-processes and compliance-mechanism
in place to the extent, in the manner and subject to the reporting made
hereinafter:
We have examined the books, papers, minute books, forms and returns
filed and other records maintained by the Company for the financial year
ended on 31 March 2018 according to the provisions of:
(i)
(ii)
(iii)
The Companies Act, 2013 (the Act) and the Rules made there
under;
The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the
Rules made there under;
The Depositories Act, 1996 and the Regulations and Bye-laws
framed there under;
(iv) Foreign Exchange Management Act, 1999 and the rules and
regulations made there under to the extent of Foreign Direct
Investment, and Overseas Direct Investment (External Commercial
Borrowing not applicable during the audit period);
(v)
The following Regulations and Guidelines prescribed under the
Securities and Exchange Board of India Act, 1992 (‘SEBI Act’) :-
(a) The Securities and Exchange Board of India (Substantial
Acquisition of Shares and Takeovers) Regulations, 2011;
(b) The Securities and Exchange Board of India (Prohibition of
Insider Trading) Regulations, 2015;
(c) The Securities and Exchange Board of India (Issue of Capital
and Disclosure Requirements) Regulations, 2009 (Not
Applicable to the Company during the audit period);
(d) The Securities and Exchange Board of India (Share Based
Employee Benefits) Regulations, 2014;
(e) The Securities and Exchange Board of India (Issue and Listing
of Debt Securities) Regulations, 2008 (Not Applicable to
the Company during the audit period);
(f)
The Securities and Exchange Board of India (Registrars
to an Issue and Share Transfer Agents) Regulations, 1993
regarding the Companies Act and dealing with client;
(g) The Securities and Exchange Board of India (Delisting of
Equity Shares) Regulations, 2009 (Not Applicable to the
Company during the audit period);
(h) The Securities and Exchange Board of India (Buyback
of Securities) Regulations, 1998 (Not Applicable to the
Company during the audit period); and
(i)
The Securities and Exchange Board of
(Listing
Obligations and Disclosure Requirements) Regulations, 2015.
India
We have also examined compliance with the applicable clauses of the
following:
(i)
Secretarial Standards issued by The Institute of Company
Secretaries of India.
(ii)
Listing Agreement entered with Stock Exchanges.
During the period under review, the Company has complied with the
provisions of the SEBI Act, Rules, Regulations, Guidelines, Standards
etc. except that company has filed Annual Performance Report (APR)
in delay.
We further report that having regard to the compliance system prevailing
in the Company and on examination of the relevant documents and
records in pursuance thereof on test check basis, the Company has
complied with the law applicable specifically to the Company i.e. The West
Bengal (Compulsory Censorship of Film Publicity Materials) Act, 1974.
We further report that
The Board of Directors of the Company is duly constituted with
proper balance of Executive Directors, Non-Executive Directors and
Independent Directors. The changes in the composition of the Board
of Directors that took place during the period under review were
carried out in compliance with the provisions of the Act.
Adequate notice is given to all directors to schedule the Board Meetings
and agenda items were sent at least seven days in advance and a system
exists for seeking and obtaining further information and clarifications on
the agenda items before the meeting and for meaningful participation at
the meeting.
All decisions at Board Meetings and Committee Meetings are carried out
either unanimously or majority as recorded in the minutes of the meetings
of the Board of Directors or Committee of the Board, as the case may be.
We further report that there are adequate systems and processes
in the company commensurate with the size and operations of the
company to monitor and ensure compliance with applicable laws, rules,
regulations and guidelines.
eRoS InteRnAtIonAl MedIA lIMIted 47
Corporate overview | ManageMent report | finanCial management We further report that during the audit period the Company has
issued and allotted 11,13,160 Equity Shares having Face Value of
` 10/- each aggregating to ` 1,11,31,600/- under Employee Stock
Option Scheme and Employee Stock Purchase Scheme) Guidelines,
1999 and the Securities and Exchange Board of India (Share Based
Employee Benefits) Regulations, 2014.
Thanking you,
For Makarand M. Joshi & Co.
Company Secretaries
Sd/-
Makarand Joshi
Partner
FCS No. 5533
CP No. 3662
Place: Mumbai
Date: 23 May 2018
Annexure A
To,
The Members,
M/s. Eros International Media Limited
201, Kailash Plaza, Opp. Laxmi Industrial Estate,
Off. Andheri Link Road, Andheri West,
Mumbai - 400053, Maharashtra (India).
Our report of even date is to be read along with this letter.
1. Maintenance of secretarial record is the responsibility of the
management of the company. Our responsibility is to express an
opinion on these secretarial records based on our audit.
2. We have followed the audit practices and processes as were
appropriate to obtain reasonable assurance about the correctness
of the contents of the Secretarial records. The verification was done
on test basis to ensure that correct facts are reflected in secretarial
records. We believe that the processes and practices, we followed
provide a reasonable basis for our opinion.
This Report is to be read with our letter of even date which is annexed as
Annexure A and forms an integral part of this Report.
3. We have not verified the correctness and appropriateness of
financial records and Books of Accounts of the company.
4. Where ever required, we have obtained the management
representation about the compliance of laws, rules and regulations
and happening of events etc.
5.
6.
The compliance of the provisions of corporate and other
applicable laws, rules, regulations, standards is the responsibility
of management. Our examination was limited to the verification of
procedures on test basis.
The Secretarial Audit Report is neither an assurance as to the future
viability of the company nor of the efficacy or effectiveness with
which the management has conducted the affairs of the company.
Thanking you,
For Makarand M. Joshi & Co.
Company Secretaries
Sd/-
Makarand Joshi
Partner
FCS No. 5533
CP No. 3662
Place: Mumbai
Date: 23 May 2018
48 AnnuAl RepoRt 2017-18
Directors’ report Annexure E
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eRoS InteRnAtIonAl MedIA lIMIted 49
Corporate overview | ManageMent report | finanCial management
Annexure F
Form for disclosure of particulars of contracts/arrangements entered into by the Company with related parties referred to in
sub-section (1) of Section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso thereto
1. Details of contracts or arrangements or transactions not at arm’s length basis :
Form No. AOC-2
(a)
Name(s) of the related party and nature of relationship
(b) Nature of contracts/arrangements/transactions
(c) Duration of the contracts/arrangements/transactions
(d)
(e)
(f)
(g)
(h)
Salient terms of the contracts or arrangements or transactions including the value, if any
Justification for entering into such contracts or arrangements or transactions
Date(s) of approval by the Board
Amount paid as advances, if any
Date on which the special resolution was passed in general meeting as required under the first proviso to Section 188
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
2. Details of material contracts or arrangement or transactions at arm’s length basis exceeding 10% of the Annual Consolidated
turnover:
(a)
(b)
Name(s) of the related party
Nature of relationship
Eros Worldwide FZ LLC
Holding company
(c) Nature of contracts/arrangements/transactions
Sale of film right, DVD/VCD, Reimbursement of expense
(d)
(e)
(f)
(g)
Duration of the contracts/arrangements/transactions
Salient terms of the contracts or arrangements or transactions including the
value, if any
Date(s) of approval by the Board, if any
Amount ` in Lakhs
Not Applicable
Not Applicable
26 May 2017
11,059
Note: All transactions with related party are detailed in Notes to accounts in financial statements.
50 AnnuAl RepoRt 2017-18
Directors’ report
Annexure G
Form No. MGT-9
EXTRACT OF ANNUAL RETURN as on the financial year ended on 31 March 2018
[Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies
(Management and Administration) Rules, 2014]
I.
REGISTRATION AND OTHER DETAILS:
i.
ii.
iii.
iv.
v.
vi.
vii.
CIN
Registration Date
Name of the Company
L99999MH1994PLC080502
19 August 1994
Eros International Media Limited
Category/Sub-Category of the Company
Public Company/ Company having Share Capital
Address of the Registered office and contact
Details
201, Kailash Plaza, Opp. Laxmi Industrial Estate, Off. Andheri Link Road,
Andheri West, Mumbai - 400053, Maharashtra (India).
Tel No: +91 22 6602 1500 | Fax: +91 22 6602 1540
Email : compliance.officer@erosintl.com
Whether listed company Yes/ No
Yes
Name, Address and Contact details of Registrar
and Transfer Agent, if any
Link Intime India Pvt. Ltd.
CIN: U67190MH1999PTC118368
C 101, 247 Park, LBS Marg, Vikhroli West, Mumbai 400 083, Maharashtra (India).
Tel: +91 22 4918 6000 | Fax: +91 22 4918 6060;
E-mail: rnt.helpdesk@linkintime.co.in & mumbai@linkintime.co.in
Website: www.linkintime.co.in
II.
PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
All the business activities contributing 10 % or more of the total turnover of the company shall be stated:-
Sr.
No.
Name and Description of main
products/services
1
Media and Entertainment Industry
NIC Code of the Product/ service
% to total turnover of the
company
59131
100%
III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES
Sr.
No
1
2
3
4
5
6
Name and Address of the Company
CIN/GLN/LLPIN
Holding/
Subsidiary/
Associate
% of shares
held
Applicable
Section
Eros International Plc, Isle of Man
Address: First Names House, Victoria Road,
Douglas, Isle of Man IM2 4DF British Isles
Eros Worldwide FZ LLC
Address: Office No. 529, Building No.
8, Fifth Floor, Dubai Media City, P.O. Box
502121, Dubai, United Arab Emirates
Eros
International Films Private Limited
Address: 201, Kailash Plaza, 2nd Floor, Plot
No. A-12, Off New Link Road, Andheri West,
Mumbai- 400 053, Maharashtra (India)
(Isle
Limited
of Man)
Copsale
Address: P.O. Box No. 958, Pasea Estate,
Road Town, Tortola, VG1110, British Virgin
Islands
Big Screen Entertainment Private Limited
Brook
B-301,
Address:
3rd
Hill
Lane,
Lokhandwala Complex, Andheri West,
Mumbai - 400 053, Maharashtra (Indai)
302,
Cross
Tower,
Private
Studios
Limited
EyeQube
Address: 201, Kailash Plaza, 2nd Floor, Plot
No. A-12, Off New Link Road, Andheri
West, Mumbai- 400 053, Maharashtra
(India)
007466V
Ultimate Holding
100
2(46)
30295
Holding
37.28
2(46)
U92113MH1994PTC080423
Subsidiary
100
2(87)(ii)
269307
Subsidiary
100
2(87)(ii)
U92110MH2005PTC156504
Subsidiary
64
2(87)(ii)
U92120MH2007PTC175027
Subsidiary
100
2(87)(ii)
eRoS InteRnAtIonAl MedIA lIMIted 51
Corporate overview | ManageMent report | finanCial management
Sr.
No
7
8
9
Name and Address of the Company
CIN/GLN/LLPIN
Holding/
Subsidiary/
Associate
% of shares
held
Applicable
Section
Private
Publishing
EM
Limited
Address: 201, Kailash Plaza, 2nd Floor, Plot
No. A-12, Off New Link Road, Andheri West,
Mumbai- 400 053, Maharashtra (India)
Private
Animation
Eros
Limited
Address: 201, Kailash Plaza, 2nd Floor, Plot
No. A-12, Off New Link Road, Andheri West,
Mumbai- 400 053, Maharashtra (India)
U92140MH2008PTC178628
Subsidiary
100
2(87)(ii)
U92100MH2008PTC186402
Subsidiary
100
2(87)(ii)
Digicine
Address:
#17-01,
Singapore 068914
160
Pte.
Robinson
SBF
Limited
Road,
Center,
201207959W
Subsidiary
100
2(87)(ii)
10 Colour Yellow Productions Private Limited
Address:
Indus House, Plot No.B-
53, Opp. Monginis Cake Factory,
New Link Road, Andheri West, Mumbai -
400053, Maharashtra (India).
11 Universal Power Systems Private Limited
Address: Shakti Towers, Suite No.4H,
Fourth Floor, No.766, Anna Salai,
Chennai – 600002, Tamil Nadu (India).
12
Distribution
International
Eros
LLP
Address: 201, Kailash Plaza, 2nd Floor, Plot
No. A-12, Off New Link Road, Andheri West,
Mumbai- 400 053, Maharashtra (India)
U92412MH2013PTC248167
Subsidiary
50
2(87)(i)
U33111TN1984PTC010826
Subsidiary
100
2(87)(ii)
AAF-3133
Subsidiary
99.80
2(87)(ii)
IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)
i.
Category-wise Share Holding as on 31 March 2018
Category of
Shareholders
No. of Shares held at the beginning of the year
i.e. 1 April 2017
No. of Shares held at the end of the year i.e.
31 March 2018
% Change
during the
year
Demat
Physical
Total % of Total
Shares
Demat
Physical
Total % of Total
Shares
A. Promoters
(1) Indian
a) Individual/ HUF
7,000
b) Central Govt
c) State Govt(s)
-
-
-
-
-
7,000
0.01
7,000
-
-
-
-
-
-
-
-
-
7,000
0.01
-
-
-
-
-
-
-
d) Bodies Corp.
21,700,000
- 21,700,000
23.12 21,700,000
- 21,700,000
22.85
(0.27)
e) Banks/FI
f) Any other
Total shareholding of
Promoter
(2) Foreign
Bodies Corporate
Total Shareholding of
Promoters (A1+A2)
B. Public Shareholding
1. Institutions
a) Mutual Funds
b) Banks/FI
c) Central Govt
d) State Govt(s)
e) Venture Capital Funds
f) Insurance Companies
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
21,707,000
- 21,707,000
23.13 21,707,000
- 21,707,000
22.86
(0.27)
47,126,290
68,833,290
- 47,126,290
50.21 35,409,440
- 68,833,290
73.34 57, 116,440
- 35,409,440
- 57, 116,440
37.28
60.14
(12.93)
(13.20)
-
100,324
-
-
-
-
-
-
-
-
-
-
-
-
-
100,324
0.11
455,464
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
455,464
-
0.48
-
-
-
-
-
-
-
-
-
0.37
-
-
-
-
52 AnnuAl RepoRt 2017-18
Directors’ report
b) Individuals
i) Individual shareholders
holding nominal share
capital upto ` 1 lakh
ii) Individual shareholders
holding nominal share
capital in excess of
` 1 lakh
c) Others (specify)
Non Resident Indians
(Repat)
Non Resident Indians
(Non Repat)
Trusts
Foreign Nationals
Sub-total (B)(2):-
Total Public
Shareholding (B)=(B)
(1)+ (B)(2)
C. Shares held by
Custodian for GDRs &
ADRs
Category of
Shareholders
No. of Shares held at the beginning of the year
i.e. 1 April 2017
No. of Shares held at the end of the year i.e.
31 March 2018
% Change
during the
year
Demat
Physical
Total % of Total
Shares
Demat
Physical
Total % of Total
Shares
g) FIIs
h) Foreign Venture
Capital Funds
i) Others (specify)
Foreign Portfolio
Investors Corporate
659,622
-
-
-
659,622
-
0.70
-
-
-
9,607,937
-
9,607,937
10.24
4,732,345
Sub-total (B)(1):-
10,367,883
- 10,367,883
11.05
5,187,809
2. Non-Institutions
a) Bodies Corp.
2,859,343
-
2,859,343
3.05 10,965,437
-
-
-
-
-
-
-
4,732,345
5,187,809
-
-
4.98
5.46
(0.70)
-
-
(5.26)
(5.59)
10,965,437
11.55
8.50
5,078,494
3
5,078,497
5.41 9,379,551
103
9,379,654
9.89
4.49
2,866,612
-
2,866,612
3.05 7,582,384
-
7,582,384
7.98
4.93
Clearing Member
3,098,600
Hindu Undivided Family
356,187
194,437
203,708
160
-
14,657,541
25,025,424
-
-
-
-
-
194,437
0.21
288,959
203,708
0.22
469,749
3,098,600
3.30 2,245,595
356,187
0.38 1,735,489
160
-
0.00
-
335
26
-
-
-
-
-
288,959
469,749
2,245,595
1,735,489
335
26
3 14,657,544
15.62 32,667,525
3 25,025,427
26.66 37,855,334
103
103
32,667,628
37,855,437
0.30
0.49
2.36
1.83
0.00
0.00
34.40
39.86
-
-
-
-
-
-
-
-
0.09
0.27
(0.94)
1.45
0.00
0.00
18.78
13.20
-
-
Grand Total (A+B+C)
93,858,714
3 93,858,717
100 94,971,774
103
94,971,877
100
ii.
Shareholding of Promoters
Shareholder’s Name
Sr.
No.
Shareholding at the end of the year
i.e. 1 April 2017
Shareholding at the beginning of the
year i.e. 31 March 2018
No. of
Shares
% of total
Shares
of the
company
% of Shares
Pledged/
encumbered
to total
shares
No. of
Shares
% of total
Shares
of the
company
% of Shares
Pledged/
encumbered
to total
shares
% change in
share holding
during the year
1 Arjan Gobindram Lulla
2 Eros Worldwide FZ LLC
3 Eros Digital Private Limited
4 Krishika Lulla
5 Meena Arjan Lulla
6 Sunil Arjan Lulla
1,400
47,126,290
21,700,000
1,400
2,800
1,400
0.00
50.21
23.12
0.00
0.00
0.00
0
1,400
4.67
35,409,440
0
0
0
0
21,700,000
1,400
2,800
1,400
0.00
37.28
22.85
0.00
0.00
0.00
0
21.26
0
0
0
0
0
(12.93)
(0.27)
0
0
0
Note: Eros Worldwide FZ LLC pledged 20,188,136 equity shares as on 31 March 2018. Out of total shares pledged, 7,045,254 equity shares are
transferred by way of pledge to pool account of the Lender, who hold the shares on behalf of Eros Worldwide FZ LLC.
eRoS InteRnAtIonAl MedIA lIMIted 53
Corporate overview | ManageMent report | finanCial management
iii. Change in Promoters’ Shareholding
Name of Promoter
Sr.
No.
Shareholding at the
beginning of the year
1 April 2017
Cumulative Shareholding
during the year
31 March 2018
No. of Shares
% of total
Shares of the
Company
No. of
Shares
% of total
Shares of the
Company
1
Arjan Gobindram Lulla
1,400
0.00
1,400
in
Date wise
during
reasons
(e.g. allotment/transfer/bonus/sweat equity etc):
Increase/Decrease
the
the year specifying
Promoters
for
Shareholding
increase/decrease
At the End of the year
2
Krishika Lulla
in
Date wise
during
reasons
(e.g. allotment/transfer/bonus/sweat equity etc):
Increase/Decrease
the
the year specifying
Promoters
for
Shareholding
increase/decrease
At the End of the year
3
Meena Arjan Lulla
Date wise Increase/Decrease in Promoters Shareholding during the year
specifying the reasons for increase/decrease (e.g. allotment/transfer/
bonus/sweat equity etc):
At the End of the year
4
Sunil Arjan Lulla
Date wise Increase/Decrease in Promoters Shareholding during the year
specifying the reasons for increase/decrease (e.g. allotment/transfer/
bonus/sweat equity etc):
At the End of the year
5
Eros Worldwide FZ LLC
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
24-Apr-2017
25-Apr-2017
26-Apr-2017
27-Apr-2017
28-Apr-2017
2-May-2017
3-May-2017
4-May-3017
5-May-2017
8-May-2017
7-Jul-2017
10-Jul-2017
11-Jul-2017
12-Jul-2017
13-Jul-2017
14-Jul-2017
17-Jul-2017
18-Jul-2017
19-Jul-2017
21-Jul-2017
25-Jul-2017
26-Jul-2017
28-Jul-2017
21-Aug-2017
54 AnnuAl RepoRt 2017-18
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
-
-
-
-
1,400
0.00
-
-
-
-
2,800
0.00
-
-
-
-
1,400
0.00
-
-
-
-
-
1,400
1,400
-
1,400
2,800
-
2,800
1,400
-
1,400
47,126,290
48.94
47,126,290
(643,986)
(325,000)
(0.68)
46,482,304
(0.34)
46,157,304
(1,297,572)
(1.37)
44,859,732
(55,512)
(15,407)
(207,576)
(98,778)
(152,585)
(28,951)
(0.06)
44,804,220
(0.02)
44,788,813
(0.22)
44,581,237
(0.10)
44,482,459
(0.16)
44,329,874
(0.03)
44,300,923
(3,458,807)
(3.64)
40,842,116
(89,668)
(9,999)
(1,581)
(16,546)
(20,000)
(0.09)
40,752,448
(0.01)
40,742,449
(0.00)
40,740,868
(0.02)
40,724,322
(0.02)
40,704,322
(1,282,738)
(1.35)
39,421,584
(211,858)
(0.22)
39,209,726
(1,254,261)
(1.32)
37,955,465
(500,000)
(332,963)
(104,294)
(508,768)
(500,000)
(600,000)
(0.53)
37,455,465
(0.35)
37,122,502
(0.11)
37,018,208
(0.54)
36,509,440
0.53
0.63
36,009,440
35,409,440
0.00
-
0.00
0.00
-
0.00
0.00
-
0.00
0.00
-
0.00
48.94
48.94
48.60
47.23
47.18
47.16
46.94
46.84
46.68
46.65
43.00
42.91
42.90
42.90
42.88
42.86
41.51
41.29
39.96
39.44
39.09
38.98
38.44
37.92
37.28
Directors’ report Name of Promoter
Sr.
No.
At the end of the year
6
Eros Digital Private Limited
Date wise Increase/Decrease in Promoters
Shareholding during the year specifying
the reasons for increase/decrease (e.g.
allotment/transfer/bonus/sweat
equity
etc):
At the End of the year
Shareholding at the
beginning of the year
1 April 2017
Cumulative Shareholding
during the year
31 March 2018
No. of Shares
% of total
Shares of the
Company
No. of
Shares
% of total
Shares of the
Company
-
-
35,409,440
21,700,000
22.85
21,700,000
-
-
37.28
22.85
-
-
-
-
21,700,000
22.85
iv. Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):
For each of the top 10 Shareholders
Sr.
No.
Shareholding at the beginning of
the year 1 April 2017
Cumulative Shareholding during
the year 31 March 2018
No. of
Shares
% of total Shares of
the Company
No. of
Shares
% of total Shares
of the Company
1
Shilpa Stock Broker Pvt Ltd
Less:
Less:
Less:
Add:
Less:
Less:
Less:
Add:
Less:
Less:
Add:
Add:
Add:
Add:
Add:
Less:
Add:
Less:
Less:
Less:
Less:
Less:
Less:
Add:
Add:
Less:
Add:
Add:
Add:
Less:
Less:
Less:
Less:
Add:
07 Apr 2017
14 Apr 2017
21 Apr 2017
28 Apr 2017
05 May 2017
12 May 2017
19 May 2017
26 May 2017
02 Jun 2017
09 Jun 2017
16 Jun 2017
23 Jun 2017
30 Jun 2017
07 Jul 2017
14 Jul 2017
21 Jul 2017
28 Jul 2017
04 Aug 2017
11 Aug 2017
18 Aug 2017
25 Aug 2017
01 Sep 2017
08 Sep 2017
15 Sep 2017
22 Sep 2017
29 Sep 2017
06 Oct 2017
13 Oct 2017
20 Oct 2017
27 Oct 2017
03 Nov 2017
10 Nov 2017
17 Nov 2017
24 Nov 2017
Market Sale
Market Sale
Market Sale
Market Buy
Market Sale
Market Sale
Market Sale
Market Buy
Market Sale
Market Sale
Market Buy
Market Buy
Market Buy
Market Buy
Market Buy
Market Sale
Market Buy
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Buy
Market Buy
Market Sale
Market Buy
Market Buy
Market Buy
Market Sale
Market Sale
Market Sale
Market Sale
Market Buy
7,40,152
(54,147)
(2,07,436)
(1,58,816)
9,49,155
(19,555)
(2,14,170)
(1,03,961)
24,416
(1,35,526)
(1,60,118)
68,216
91,539
94,402
1,60,165
28,66,481
(21,97,784)
5,45,044
(11,40,247)
(3,488)
(94,253)
(1,752)
(13,571)
(17,675)
95,325
20,990
(49,298)
1,60,999
87,139
17,931
(16,508)
(36,172)
(1,44,143)
(1,43,313)
2,56,898
0.79
7,40,152
(0.06)
(0.22)
(0.17)
6,86,005
4,78,569
3,19,753
1.00
12,68,908
(0.02)
(0.23)
(0.11)
12,49,353
10,35,183
9,31,222
0.03
9,55,638
(0.14)
(0.17)
0.07
0.10
0.10
0.17
3.02
8,20,112
6,59,994
7,28,210
8,19,749
9,14,151
10,74,316
39,40,797
(2.31)
17,43,013
0.57
22,88,057
(1.20)
(0.00)
(0.10)
(0.00)
(0.01)
(0.02)
0.10
0.02
11,47,810
11,44,322
10,50,069
10,48,317
10,34,746
10,17,071
11,12,396
11,33,386
(0.05)
10,84,088
0.17
0.09
0.02
(0.02)
(0.04)
(0.15)
(0.15)
12,45,087
13,32,226
13,50,157
13,33,649
12,97,477
11,53,334
10,10,021
0.27
12,66,919
0.79
0.72
0.50
0.34
1.34
1.32
1.09
0.98
1.01
0.86
0.69
0.77
0.86
0.96
1.13
4.15
1.84
2.41
1.21
1.20
1.11
1.10
1.09
1.07
1.17
1.19
1.14
1.31
1.40
1.42
1.40
1.37
1.21
1.06
1.33
eRoS InteRnAtIonAl MedIA lIMIted 55
Corporate overview | ManageMent report | finanCial management
For each of the top 10 Shareholders
Sr.
No.
Shareholding at the beginning of
the year 1 April 2017
Cumulative Shareholding during
the year 31 March 2018
No. of
Shares
% of total Shares of
the Company
No. of
Shares
% of total Shares
of the Company
Less:
Less:
Less:
Add:
Add:
Less:
Less:
Less:
Add:
Add:
Add:
Less:
Add:
Add:
Add:
Less:
Less:
Less:
01 Dec 2017
08 Dec 2017
15 Dec 2017
22 Dec 2017
29 Dec 2017
05 Jan 2018
12 Jan 2018
19 Jan 2018
26 Jan 2018
02 Feb 2018
09 Feb 2018
16 Feb 2018
23 Feb 2018
02 Mar 2018
09 Mar 2018
16 Mar 2018
23 Mar 2018
31 Mar 2018
Market Sale
Market Sale
Market Sale
Market Buy
Market Buy
Market Sale
Market Sale
Market Sale
Market Buy
Market Buy
Market Buy
Market Sale
Market Buy
Market Buy
Market Buy
Market Sale
Market Sale
Market Sale
At the end of the year (or on the date of separation, if separated
during the year)
2 Government Pension Fund Global
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Less:
07 Apr 2017
28 Apr 2017
12 May 2017
09 Jun 2017
21 Jul 2017
28 Jul 2017
11 Aug 2017
01 Sep 2017
08 Sep 2017
12 Jan 2018
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
At the End of the year (or on the date of separation, if separated
during the year)
3 M B Finmart Pvt Ltd.
Add:
Add:
Add:
Add:
Add:
Add:
Add:
Add:
Add:
Add:
19 May 2017
26 May 2017
07 Jul 2017
21 Jul 2017
28 Jul 2017
04 Aug 2017
11 Aug 2017
18 Aug 2017
01 Sep 2017
29 Sep 2017
Market Buy
Market Buy
Market Buy
Market Buy
Market Buy
Market Buy
Market Buy
Market Buy
Market Buy
Market Buy
At the end of the year (or on the date of separation, if separated
during the year)
4
Puran Associates Pvt Ltd.
Add:
Add:
Add:
07 Jul 2017
21 Jul 2017
28 Jul 2017
Market Buy
Market Buy
Market Buy
56 AnnuAl RepoRt 2017-18
(32,350)
(26,109)
(1,34,800)
46,120
7,429
(90,998)
(38,431)
(31,640)
36,250
1,28,784
28,353
(60,853)
64,478
1,01,354
27,950
(13,379)
(23,298)
(34,894)
-
17,40,000
(1,10,000)
(1,05,000)
(2,05,000)
(20,000)
(75,000)
(25,000)
(13,000)
(37,000)
(5,615)
(31,236)
-
0
2,691
7,309
77,500
3,25,000
3,60,000
62,500
10,000
10,000
2,24,352
10,000
-
0
77,500
3,25,000
3,75,000
(0.03)
(0.03)
(0.14)
0.05
0.01
(0.10)
(0.04)
(0.03)
0.04
0.14
0.03
12,34,569
12,08,460
10,73,660
11,19,780
11,27,209
10,36,211
9,97,780
9,66,140
10,02,390
11,31,174
11,59,527
(0.06)
10,98,674
0.07
0.11
0.03
(0.01)
(0.02)
(0.04)
11,63,152
12,64,506
12,92,456
12,79,077
12,55,779
12,20,885
-
12,20,885
1.83
17,40,000
(0.12)
(0.11)
(0.22)
(0.02)
(0.08)
(0.03)
(0.01)
(0.04)
(0.01)
(0.03)
16,30,000
15,25,000
13,20,000
13,00,000
12,25,000
12,00,000
11,87,000
11,50,000
11,44,385
11,13,149
-
11,13,149
0.00
0.00
0.01
0.08
0.34
0.38
0.07
0.01
0.01
0.24
0.01
0
2,691
10,000
87,500
4,12,500
7,72,500
8,35,000
8,45,000
8,55,000
10,79,352
10,89,352
-
10,89,352
0.00
0.08
0.34
0.39
0
77,500
4,02,500
7,77,500
1.30
1.27
1.13
1.18
1.19
1.09
1.05
1.02
1.06
1.19
1.22
1.16
1.22
1.33
1.36
1.35
1.32
1.29
1.29
1.83
1.72
1.61
1.39
1.37
1.29
1.26
1.25
1.21
1.20
1.17
1.17
0.00
0.00
0.01
0.09
0.43
0.81
0.88
0.89
0.90
1.14
1.15
1.15
0.00
0.08
0.42
0.82
Directors’ report
For each of the top 10 Shareholders
Sr.
No.
Shareholding at the beginning of
the year 1 April 2017
Cumulative Shareholding during
the year 31 March 2018
No. of
Shares
% of total Shares of
the Company
No. of
Shares
% of total Shares
of the Company
Add:
01 Sep 2017
Market Buy
3,02,500
At the end of the year (or on the date of separation, if separated
during the year)
5
VIC ENTERPRISES PVT LTD
Add:
Add:
Add:
07 Jul 2017
21 Jul 2017
28 Jul 2017
Market Buy
Market Buy
Market Buy
At the end of the year (or on the date of separation, if separated
during the year)
6
Rajesh M Sanghavi (HUF)
Add:
Less:
Add:
01 Sep 2017
29 Sep 2017
23 Mar 2018
Market Buy
Market Sale
Market Buy
At the end of the year (or on the date of separation, if separated
during the year)
7
Dimensional Emerging Markets Value Fund
Less:
Less:
Less:
Add:
16 Jun 2017
30 Jun 2017
07 Jul 2017
16 Mar 2018
Market Sale
Market Sale
Market Sale
Market Buy
At the End of the year (or on the date of separation, if separated
during the year)
-
0
80,000
3,25,000
3,75,000
-
0
1,00,000
(48,452)
6,68,000
-
4,52,229
(21,622)
(36,038)
(12,310)
11,232
-
8
Danske Invest Sicav-SIF- Emerging And Frontier Markets Smid
5,11,900
Less:
Less:
Less:
Less:
Less:
Less:
Less:
Add:
07 Apr 2017
05 May 2017
02 Jun 2017
23 Jun 2017
30 Jun 2017
07 Jul 2017
29 Sep 2017
31 Mar 2018
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Buy
At the end of the year (or on the date of separation, if separated
during the year)
9 Morgan Stanley Mauritius Company Limited
LESS:
LESS:
LESS:
LESS:
LESS:
LESS:
LESS:
LESS:
LESS:
LESS:
LESS:
LESS:
LESS:
LESS:
LESS:
LESS:
Less:
28 Apr 2017
05 May 2017
23 Jun 2017
07 Jul 2017
14 Jul 2017
21 Jul 2017
28 Jul 2017
04 Aug 2017
15 Sep 2017
22 Sep 2017
29 Sep 2017
20 Oct 2017
27 Oct 2017
17 Nov 2017
24 Nov 2017
01 Dec 2017
08 Dec 2017
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
Market Sale
(50,000)
(1,06,400)
(1,14,500)
(20,000)
(20,000)
(20,000)
(3,017)
8,000
-
8,17,623
(70,159)
(3,61,467)
(36,430)
(6,806)
(2,828)
(44,771)
(1,05,411)
(1,314)
(10,641)
(45,059)
(10,122)
(6,096)
(2,0879)
(721)
(23,810)
(14,133)
(2,012)
0.32
10,80,000
-
10,80,000
0.00
0.08
0.34
0.39
-
0.00
0.11
(0.05)
0
80,000
4,05,000
7,80,000
7,80,000
0
1,00,000
51,548
0.70
7,19,548
-
7,19,548
0.48
(0.02)
(0.04)
(0.01)
4,52,229
4,30,607
3,94,569
3,82,259
0.01
3,93,491
-
3,93,491
0.54
(0.05)
(0.11)
(0.12)
(0.02)
(0.02)
(0.02)
(0.00)
5,11,900
4,61,900
3,55,500
2,41,000
2,21,000
2,01,000
1,81,000
1,77,983
0.01
1,85,983
-
1,85,983
0.86
8,17,623
(0.07)
(0.38)
(0.04)
(0.01)
(0.00)
(0.05)
(0.11)
(0.00)
(0.01)
(0.05)
(0.01)
(0.01)
(0.02)
(0.00)
(0.03)
(0.01)
(0.00)
7,47,464
3,85,997
3,49,567
3,42,761
3,39,933
2,95,162
1,89,751
1,88,437
1,77,796
1,32,737
1,22,615
1,16,519
95,640
94,919
71,109
56,976
54,964
1.14
1.14
0.00
0.08
0.43
0.82
0.82
0.00
0.11
0.05
0.76
0.76
0.48
0.46
0.42
0.40
0.41
0.41
0.54
0.49
0.37
0.25
0.23
0.21
0.19
0.19
0.20
0.20
0.86
0.79
0.41
0.37
0.36
0.36
0.31
0.20
0.20
0.19
0.14
0.13
0.12
0.10
0.10
0.07
0.06
0.06
eRoS InteRnAtIonAl MedIA lIMIted 57
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For each of the top 10 Shareholders
Sr.
No.
Shareholding at the beginning of
the year 1 April 2017
Cumulative Shareholding during
the year 31 March 2018
No. of
Shares
% of total Shares of
the Company
No. of
Shares
% of total Shares
of the Company
Less:
Less:
Less:
15 Dec 2017
29 Dec 2017
05 Jan 2018
Market Sale
Market Sale
Market Sale
At the end of the year (or on the date of separation, if separated
during the year)
10 Maverick Share Brokers Limited - Client Beneficiary A/C
Less:
Add:
Less:
Add:
Add:
Less:
Add:
Add:
Less:
Less:
Add:
Add:
Add:
Add:
Add:
Add:
Add:
Less:
Less:
Less:
Less:
Add:
Less:
Less:
Add:
Add:
Add:
Add:
Add:
Add:
Less:
Add:
Less:
Less:
Add:
Less:
Less:
Add:
Add:
Add:
Less:
Less:
Less:
Less:
07 Apr 2017
14 Apr 2017
21 Apr 2017
28 Apr 2017
05 May 2017
12 May 2017
19 May 2017
26 May 2017
02 Jun 2017
09 Jun 2017
16 Jun 2017
23 Jun 2017
30 Jun 2017
07 Jul 2017
14 Jul 2017
21 Jul 2017
28 Jul 2017
04 Aug 2017
11 Aug 2017
18 Aug 2017
25 Aug 2017
01 Sep 2017
08 Sep 2017
15 Sep 2017
22 Sep 2017
29 Sep 2017
06 Oct 2017
13 Oct 2017
20 Oct 2017
27 Oct 2017
03 Nov 2017
10 Nov 2017
17 Nov 2017
24 Nov 2017
01 Dec 2017
08 Dec 2017
15 Dec 2017
22 Dec 2017
29 Dec 2017
30 Dec 2017
05 Jan 2018
12 Jan 2018
19 Jan 2018
26 Jan 2018
Market Sale
Market Buy
Market Sale
Market Buy
Market Buy
Market Sale
Market Buy
Market Buy
Market Sale
Market Sale
Market Buy
Market Buy
Market Buy
Market Buy
Market Buy
Market Buy
Market Buy
Market Sale
Market Sale
Market Sale
Market Sale
Market Buy
Market Sale
Market Sale
Market Buy
Market Buy
Market Buy
Market Buy
Market Buy
Market Buy
Market Sale
Market Buy
Market Sale
Market Sale
Market Buy
Market Sale
Market Sale
Market Buy
Market Buy
Market Buy
Market Sale
Market Sale
Market Sale
Market Sale
58 AnnuAl RepoRt 2017-18
(3,876)
(415)
(7,561)
-
4,39,087
(2,48,251)
14,540
(50,004)
19,754
1,37,595
(1,41,320)
5,525
83,670
(2,10,215)
(42,820)
45,965
43,265
882
887
3,488
88,463
2,19,007
(1,41,234)
(1,78,936)
(1,146)
(79,525)
46,719
(47,490)
(5,950)
675
2,829
3,725
20,021
9,605
23,841
(49,854)
2,092
(8,501)
(2,661)
10,196
(6,743)
(4,778)
4,844
4,025
3,871
(5,499)
(2,223)
(375)
(2,475)
(0.00)
(0.00)
(0.01)
-
0.46
(0.26)
51,088
50,673
43,112
43,112
4,39,087
1,90,836
0.02
2,05,376
(0.05)
0.02
0.14
(0.15)
0.01
0.09
(0.22)
(0.05)
0.05
0.05
0.00
0.00
0.00
0.09
0.23
(0.15)
(0.19)
(0.00)
(0.08)
0.05
(0.05)
(0.01)
0.00
0.00
0.00
0.02
0.01
0.03
(0.05)
0.00
(0.01)
(0.00)
0.01
(0.01)
(0.01)
0.01
0.00
0.00
(0.01)
(0.00)
(0.00)
(0.00)
1,55,372
1,75,126
3,12,721
1,71,401
1,76,926
2,60,596
50,381
7,561
53,526
96,791
97,673
98,560
1,02,048
1,90,511
4,09,518
2,68,284
89,348
88,202
8,677
55,396
7,906
1,956
2,631
5,460
9,185
29,206
38,811
62,652
12,798
14,890
6,389
3,728
13,924
7,181
2,403
7,247
11,272
15,143
9,644
7,421
7,046
4,571
0.05
0.05
0.05
0.05
0.46
0.20
0.22
0.16
0.18
0.33
0.18
0.19
0.27
0.05
0.01
0.06
0.10
0.10
0.10
0.11
0.20
0.43
0.28
0.09
0.09
0.01
0.06
0.01
0.00
0.00
0.01
0.01
0.03
0.04
0.07
0.01
0.02
0.01
0.00
0.01
0.01
0.00
0.01
0.01
0.02
0.01
0.01
0.01
0.00
Directors’ report
For each of the top 10 Shareholders
Sr.
No.
Shareholding at the beginning of
the year 1 April 2017
Cumulative Shareholding during
the year 31 March 2018
No. of
Shares
% of total Shares of
the Company
No. of
Shares
% of total Shares
of the Company
Add:
Add:
Less:
Add:
Less:
Add:
Less:
Add:
Add:
02 Feb 2018
09 Feb 2018
16 Feb 2018
23 Feb 2018
02 Mar 2018
09 Mar 2018
16 Mar 2018
23 Mar 2018
31 Mar 2018
Market Buy
Market Buy
Market Sale
Market Buy
Market Sale
Market Buy
Market Sale
Market Buy
Market Buy
At the end of the year (or on the date of separation, if separated
during the year)
v.
Shareholding of Directors and Key Managerial Personnel:
For each of the Directors and KMP
Sr.
No.
687
162
(631)
100
(4,208)
734
(751)
690
950
-
0.00
0.00
(0.00)
0.00
(0.00)
0.00
(0.00)
0.00
0.00
-
5,258
5,420
4,789
4,889
681
1,415
664
1,354
2,304
2,304
0.01
0.01
0.01
0.01
0.00
0.00
0.00
0.00
0.00
0.00
Shareholding at the beginning of
the year
1 April 2017
Cumulative Shareholding during
the year
31 March 2018
No. of
Shares
% of total Shares of
the Company
No. of
Shares
% of total Shares of
the Company
1
2
3
Mr. Dhirendra Swarup - Independent Director
Date wise Increase/Decrease in Share holding during the year
specifying the reasons for increase/decrease (e.g. allotment/
transfer/bonus/sweat equity etc):
At the end of the year
Mr. Rakesh Sood - Independent Director
Date wise Increase/Decrease in Share holding during the year
specifying the reasons for increase/decrease (e.g. allotment/
transfer/bonus/sweat equity etc):
At the end of the year
0
0
-
0
0
-
Mr. Sunil Arjan Lulla - Director & Key Managerial
Personnel
1,400
Date wise Increase/Decrease in Share holding during the year
specifying the reasons for increase/decrease (e.g. allotment/
transfer/bonus/sweat equity etc):
At the end of the year
4
Mr. Kishore Arjan Lulla - Executive Director
Date wise Increase/Decrease in Share holding during the year
specifying the reasons for increase/decrease (e.g. allotment/
transfer/bonus/sweat equity etc):
At the end of the year
5
1Mrs. Jyoti Deshpande - Executive Director
Add: 13 April 2017 (Exercise of shares granted under ESOP)
Less: 14 April 2017 (Market Sale)
Less: 19 January 2018 (Market Sale)
At the end of the year
6
Mr. S. Lakshminarayanan - Non Executive & Independent
Director
Date wise Increase/Decrease in Share holding during the year
specifying the reasons for increase/decrease (e.g. allotment/
transfer/bonus/ sweat equity etc):
At the end of the year
0
-
0
0
-
1,42,790
3,60,000
(1,08,971)
(33,819)
-
0
0
-
0
0
-
0
0
-
0
0
-
0
0
-
0.15
0.38
(0.11)
(0.04)
-
0
0
-
0
0
0
0
0
0
1,400
0
1,400
0
0
0
142,790
5,02,790
3,93,819
3,60,000
3,60,000
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0.15
0.53
0.42
0.38
0.38
0
0
0
1 The designation of Mrs. Jyoti Deshpande has been changes from Executive Director to Non Executive Non Independent Director w.e.f. 1 April 2018
eRoS InteRnAtIonAl MedIA lIMIted 59
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Sr.
No.
7
8
For each of the Directors and KMP
Shareholding at the beginning of
the year
1 April 2017
Cumulative Shareholding during
the year
31 March 2018
No. of
Shares
% of total Shares of
the Company
No. of
Shares
% of total Shares of
the Company
Mr. Farokh P. Gandhi- Key Managerial Personnel
Date wise Increase/Decrease in Share holding during the year
specifying the reasons for increase/decrease (e.g. allotment/
transfer/bonus/ sweat equity etc):
At the end of the year
Mr. Abhishekh Kanoi - Key Managerial Personnel
Add: 19 June 2017 (Exercise of shares granted under ESOP)
Less: 19 July 2017 (Market Sale)
Add: 19 November 2017(Exercise of shares granted under
ESOP)
Less: 28 November 2017 (Market Sale)
Less: 19 January 2018 (Market Sale)
Add: 21 February 2018 (Exercise of shares granted under
ESOP)
At the end of the year
43
0
-
0
4,889
(1,500)
2,222
(650)
(1,100)
2,667
-
0
0
-
0
0
0
0
0
0
0
-
43
0
43
0
4,889
3,389
5,611
4,961
3,861
6,528
6,528
V.
INDEBTEDNESS
Indebtedness of the Company including interest outstanding/accrued but not due for payment
Secured Loans
excluding
Deposits
Unsecured Loans
Deposits
Indebtedness at the beginning of the financial year
i) Principal Amount
ii) Interest due but not paid
iii) Interest accrued but not due
Total (i+ii+iii)
Change in Indebtedness during the financial year
Addition
Reduction
Net Change
Indebtedness at the end of the financial year
i) Principal Amount
ii) Interest due but not paid
iii) Interest accrued but not due
Total (i+ii+iii)
62,30,84,591
-
3,80,25,774
6,29,11,10,365
70,15,59,448
-
154,110
70,17,13,558
4,79,12,80,161
(48,45,50,080)
(19,32,69,919)
1,93,58,00,443
(1,03,11,94,817)
90,46,05,626
6,06,99,94,744
-
2,78,45,702
6,09,78,40,446
1,60,47,65,142
-
15,54,042
1,60,63,19,184
VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
A. Remuneration to Managing Director, Whole-time Directors and/or Manager:
Particulars of Remuneration
Sr.
No.
1 Gross Salary
(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961
(b) Value of perquisites u/s 17(2) Income-tax Act, 1961
(c) Profits in lieu of salary under section 17(3) Income- tax Act, 1961
2 Stock Option
3 Sweat Equity
4 Commission -as % of profit
- others, Specify
5 Others, please specify(Bonus)
Total (A)
Ceiling as per the Act
60 AnnuAl RepoRt 2017-18
0
0
0
0
0
0
0
0
0
0
0
Amount in `
Total
Indebtedness
6,95,46,44,039
-
3,81,79,884
6,99,28,23,923
6,72,70,80,604
(6,01,57,44,897)
(71,13,35,707)
7,67,47,59,886
-
2,93,99,744
7,70,41,59,630
-
-
-
-
-
-
-
-
-
-
-
Amount in `
Name of Managing Director
Mr. Sunil Arjan Lulla
4,25,17,464
12,39,600
-
-
-
-
-
-
4,37,57,064
9,87,16,738
Directors’ report
Particulars of Remuneration
Name of Directors
Total Amount (`)
B. Remuneration to other directors:
Sr.
No.
1.
Independent Directors
• Fees for attending Board/Committee Meetings
• Commission (payable for 2017-18)
• Others (Reimbursement of maintenance of Chairman’s office and expenses
incurred towards performance of duties as Chairman)
Total (1)
2.
Other Non-Executive Non Independent Directors
• Fees for attending Board/Committee Meetings
• Commission
• Others, please specify
Total (2)
Total (B) = (1)+(2)
Total Managerial Remuneration
Others, please specify
Mr. Naresh Chandra
Mr. Dhirendra Swarup
Mr. Rakesh Sood
Mr. S. Lakshminarayanan
Mr. Naresh Chandra
Mr. Dhirendra Swarup
Mr. Rakesh Sood
Mr. S. Lakshminarayanan
Mr. Naresh Chandra
Mr. Dhirendra Swarup
A+B
1,60,000
6,80,000
8,00,000
2,40,000
13,63,014
48,76,209
27,77,113
9,33,664
2,36,000
1,50,153
1,22,16,153
-
-
-
-
1,22,16,153
5,59,73,217
1,97,43,348
On demise of Mr. Naresh Chandra, he ceased to be Chairman and Non Executive Independent Director of the Company w.e.f. 9 July 2017.
Notes:
•
• Mr. Dhirendra Swarup was re-designated as Chairman and Non-Executive Independent Director of Company w.e.f. 11 August 2017.
• Mr. S. Lakshminarayanan was appointed as Non Executive Additional Independent Director of the Company w.e.f. 14 November 2017.
C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD
Sr.
No.
Particulars of
Remuneration
2Previous Key Managerial Personnel
3Key Managerial Personnel
Mr. Dinesh Modi
(Group Chief
Financial Officer
(India))
Mrs. Dimple Mehta
(Vice President
- Company
Secretary &
Compliance
Officer)
Mr. Farokh P.
Gandhi (Chief
Financial Officer)
Mr. Abhishekh
Kanoi
(Vice President
-Company
Secretary &
Compliance
Officer)
Total
1,26,96,674
29,95,828
4,82,258
8,87,097
1,70,61,857
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
93,34,280
2,20,30,954
22,71,207
52,67,035
-
4,82,258
5,00,996
13,88,093
1,21,06,483
2,91,68,340
1 Gross Salary
(a) Salary as per provisions
contained in section 17(1) of
the Income-tax Act, 1961
(b) Value of perquisites u/s 17(2)
Income-tax Act, 1961
(c) Profits in lieu of salary under
section 17(3) Income-tax Act,
1961
Stock Option
2
3
Sweat Equity
4 Commission
- as % of profit
- others, specify…
5 Others
Total
VII. PENALTIES/PUNISHMENT/ COMPOUNDING OF OFFENCES:
2 Mrs. Dimple Mehta resigned from the post of VP-Company Secretary and Compliance Officer w.e.f. 14 December 2017 and Mr. Dinesh Modi resigned from the post of
Group Chief Financial Officer (India) of the Company w.e.f. 8 March 2018 respectively.
3 Mr. Abhishekh Kanoi was appointed as VP-Company Secretary and Compliance Officer w.e.f. 15 December 2017 and Mr. Farokh P. Gandhi was appointed as Chief
Financial Officer w.e.f. 9 March 2018 respectively.
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Type
Section of the
Companies Act
Brief Description
Details of Penalty/
Punishment/
Compounding fees
imposed
Authority [RD/NCLT/
COURT]
Appeal made,
if any (give Details)
A. COMPANY
Penalty
Punishment
Compounding
B. DIRECTORS
Penalty
Punishment
Compounding
C. OTHER OFFICERS IN DEFAULT
Penalty
Punishment
Compounding
NIL
NIL
NIL
62 AnnuAl RepoRt 2017-18
Directors’ report Annexure H
Corporate Social Responsibility
1. Brief outline of the Company’s CSR
Policy
The Company’s CSR vision is to make concerted efforts towards promotion of education amongst
the underprivileged and for women empowerment.
2. Overview of projects or programs
be
proposed
to
undertaken/
undertaken
3. Reference to the web-link to the CSR
policy and projects or programs
Besides this, the Company may also undertake other CSR activities listed in Schedule VII of the
Companies Act, 2013.
In accordance with the Company’s CSR Policy and its vision, the Company intends to participate
in CSR activities with “Arpan”, a registered NGO which is engaged in Personal Safety Education
programme aimed at tackling and preventing child sexual abuse. It also focuses on creating
awareness and skill enhancement of adults like parents, teachers and institutional care takers who
are primary stakeholders and care givers in child’s life.
The details of CSR are also uploaded on the website at www.erosintl.com
4. Composition of the CSR Committee Members of the Committee
• Mr. Rakesh Sood [Non-Executive Independent Director] (Chairman)
• Mr. Kishore Arjan Lulla [Executive Director]
• Mr. Sunil Arjan Lulla [Executive Director]
• Mrs. Jyoti Deshpande [Non-Executive Non-Independent Director]
Net Profit before Tax (NPBT)
Particulars
2016-17
2015-16
2014-15
Average NPBT
2% of Average NPBT
` 4.48 Crores
` in Crores
236.94
199.24
236.38
224.19
4.48
5. Average Net Profit of the Company
for last three Financial Years
6. Prescribed CSR Expenditure (two
per cent of the amount as in Item
No. 5 above)
7. Details of CSR spent during the
financial year
a. Total amount spent in FY 2017-18 Nil
b. Amount unspent, if any
Unspent CSR amount is ` 4.48 Crores in FY 2017-18
c. Manner in which the amount spent during the financial year is detailed below:
1
S.
No.
2
CSR Project
or activity
identified
3
Sector in which
the project is
covered
4
Projects or
programs
(1) Local area or
other
(2) Specify the
state and district
where projects
or programs was
undertaken
5
Amount outlay
(budget) project
or programs
wise
6
Amount spent on
the projects or
programs
Sub-heads;
7
Cumulative
expenditure
upto the
reporting
period
(1) Direct
expenditure
on projects or
programs
(2) Overheads:
Nil
8
Amount spent:
Direct or
through
implementing
agency
8. Reasons for not spending the amount of two per
cent of the average net profit of the last three
financial years
9.
Statement by CSR Committee is stated below:
During the Current Financial year, the Company was in the process of identifying and
evaluating projects in line with the current CSR Policy of the Company.
The Corporate Social Responsibility Committee hereby confirm that the implementation and monitoring of CSR Policy is in compliance with CSR
objectives and Policy of the Company`.
Sd/-
Sunil Arjan Lulla
DIN: 00243191
Member of CSR Committee & Executive Vice
Chairman & Managing Director
Date: 23 May 2018
Place: Mumbai
Sd/-
Rakesh Sood
DIN: 07170411
Chairman of CSR Committee
eRoS InteRnAtIonAl MedIA lIMIted 63
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Annexure I
Business Responsibility Report
Introduction:
The Company is pleased to present its Second Business Responsibility Report for the Financial Year ended 31 March 2018 in conformance to the
requirements of the clause (f) of sub-regulation (2) of Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015,
the Business Responsibility Report for FY 2017-18 is aligned with the nine principles of the National Voluntary Guidelines on Social, Environmental &
Economic Responsibilities of Business (NVG-SEE) notified by the Ministry of Corporate Affairs, Government of India.
This Report demonstrates the Company’s commitment towards sustainability as a business imperative. The Company continuously aims to achieve
long term value for its stakeholders by conducting its business in a socially responsible and ethical manner and engaging itself in deep social
engagements.
The Company is engaged in creating content for consumers across varied subjects and geographies which enable the Company to deliver sustainable
and attractive returns for its stakeholders. Entertainment industry is dynamic and the viewer preferences changes more rapidly. To keep up with the
pace, the Company endeavours to align its business strategy and create value for all its stakeholders.
In pursuance of the Company’s commitment to responsible business, the Company has aligned its policies and guidelines with the principles
articulated under NVG-SEE notified by the Ministry of Corporate Affairs, Government of India.
The Business Responsibility Report is available at the website of the Company at www.erosintl.com.
Principle
1
Principle
3
Principle
5
Principle
7
Principle
9
ETHICS, TRANSPARENCY AND ACCOUNTABILITY
Businesses should conduct and govern themselves
with Ethics, Transparency and Accountability.
PRODUCTS LIFE CYCLE SUSTAINABILITY
Businesses should provide goods and services that
are safe and contribute to sustainability throughout
their life cycle.
EMPLOYEES’ WELL BEING
Businesses should promote the wellbeing
of all employees.
STAKEHOLDERS’ ENGAGEMENT
Businesses should respect the interests of, and be
responsive towards all stakeholders, especially those
who are disadvantaged, vulnerable and marginalised.
HUMAN RIGHTS
Businesses should respect and
promote human right.
ENVIRONMENT
Businesses should respect, protect and make efforts
to restore the environment.
POLICY ADVOCACY
Businesses, when engaged in influencing public and
regulatory policy, should do so in a responsible manner.
INCLUSIVE GROWTH
Businesses should support inclusive growth and
equitable development.
CUSTOMER VALUE
Businesses should engage with and provide value to their
customers and consumers in a responsible manner.
Principle
2
Principle
4
Principle
6
Principle
8
64 AnnuAl RepoRt 2017-18
Directors’ report Section A: General Information about the Company
Section C: Other Details
1. Corporate
Identity Number
(CIN) of
the Company:
1.
Subsidiary company/companies
L99999MH1994PLC080502
2. Name of the Company: Eros International Media Limited
3. Registered Address: 201, Kailash Plaza Opp. Laxmi Industrial
Estate, Off. Andheri Link Road, Andheri West, Mumbai - 400053,
Maharashtra (India).
4. Website: www.erosintl.com
5.
6.
7.
E-mail id: compliance.officer@erosintl.com
Financial Year Reported: 1 April 2017 to 31 March 2018
Sector(s) that the Company is engaged in (industrial activity
code-wise): Media and Entertainment Industry
National Industrial
Classification Code of Ministry
of Statistics and Programme
Implementation (NIC Code)
59131
Description
The Company is mainly engaged
in the business of Motion picture,
video and television programme
production, sound recording and
music publishing activities.
8.
three key products/services
List
the Company
manufactures/provides (as in balance sheet): The Company
is engaged in various activities like co-production, acquisition and
distribution of Indian language films in multiple formats worldwide.
that
9.
Total number of locations where business activity is
undertaken by the Company:
i.
ii.
Number of International Locations: Company’s international
business operations are carried out by its group companies
through their offices in International locations (including
representative offices and/or distribution arrangement) and the
major ones are UAE, United Kingdom, USA, Australia, Fiji etc.
Number of National Locations: Indian operations of the
Company are carried out through its offices located at
namely Mumbai, Delhi, Jalandhar, Bangalore, Kolkata, Patna,
Chennai, Kochi etc.
10. Markets served by the Company – local/state/national/
international: The Company being in the Media and Entertainment
Industry engaged itself in serving the millions of national and
international viewers through film releases in more than 50
countries.
Section B: Financial Details of the Company*
1.
2.
3.
4.
5.
Paid-up capital (INR): INR 94,97,18,770
Total turnover (INR): INR 70,766 (` in Lakhs)
Total profit after taxes (INR): INR 7,701 (` in Lakhs)
Total spending on Corporate Social Responsibility (CSR) as
percentage of profit after tax (%): Nil
List of activities in which the Corporate Social Responsibility
(CSR) expenditures have been incurred: Nil
* As per Standalone Ind AS financials
As on 31 March 2018, the Company has 10 subsidiaries, as per
details given in Annexure to Consolidated Financial Statements.
2.
Participation of subsidiary company/companies in the BR
Initiatives of the parent company
Business Responsibility initiatives of the parent company are not
applicable to the subsidiary companies.
3.
Participation and percentage of participation of other entity/
entities (e.g. suppliers and distributors, among others) that
the Company does business with, in the BR initiatives of the
Company
None of the entity / entities with whom Company does business
participates in the BR initiatives of the Company.
Section D: BR Information
1. Details of Director/Directors responsible for BR
a)
Details of the Director/Director responsible for the implementation
of the BR policy/policies
All Corporate Policies including the Business Responsibility Policies
of the Company are engrained in day-to-day business operations
of the Company and are implemented by Management at all levels.
The responsibility for implementation of BR policies is ultimately
shouldered on
(CSR)
Committee of the Board of Directors.
the Corporate Social Responsibility
Members of the CSR Committee comprises of:
DIN
Name
Designation
07170411 Mr. Rakesh Sood
00243191 Mr. Sunil Arjan Lulla
Non-Executive
Independent Director
Executive Vice Chairman &
Managing Director
02303295 Mr. Kishore Arjan Lulla Executive Director
02303283 Mrs. Jyoti Deshpande$ Executive Director
$ The designation of Mrs. Jyoti Deshpande has been changed from
Executive Director to Non Executive Non Independent Director
w.e.f. 1 April 2018.
b)
Details of the BR Head
DIN Number
Not Applicable
Name
Mr. Farokh P. Gandhi
Designation
Chief Financial Officer
Telephone Number
+91 22 66021500
Email id
compliance.officer@erosintl.com
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2.
a)
Principle-wise (as per NVGs) BR Policy/Policies (Reply in Y/N)
Details of Compliance
Sl. No. Questions
1
2
3
4
5
6
7
8
9
Do you have policy/policies for:
Has the policy been formulated in consultation with relevant
stakeholders?
Does the policy conform to any national /international standards?
If yes, specify. (The policies are based on NVG-guidelines, in
addition to conformance to the spirit of international standards
like ISO 9000, ISO 14000, OHSAS 18000, UNGC guidelines and
ILO principles)
Has the policy been approved by the Board?
If yes, has it been signed by the MD/owner/CEO /appropriate
Board Director?
Does the Company have a specified committee of the Board/
Director/Official to oversee the implementation of the policy?
Indicate the link to view the policy online?
P1
P2
P3
P4
P5
P6
P7
P8
P9
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
The policies have been prepared in accordance to the applicable
laws and are in line with the international standards.
Y
Y
Y
Y
Y
Y
Y
Y
Y
The implementation and adherence of the Business Responsibility
Policy is assigned to the Corporate Social Responsibility (CSR)
Committee. Please refer to the Corporate Governance report
forming part of the Annual Report, for terms of reference of CSR
Committee.
Please refer below for linkages of these policies with BR principles
and for web links
Has the policy been formally communicated to all relevant internal
and external stakeholders?
Yes, the policies have been communicated to the internal and
external stakeholders.
Does the Company have in-house structure to implement its
policy/policies?
Does the Company have a grievance redressal mechanism
related to the policy/policies to address stakeholders’ grievances
related to policy/policies?
All Corporate Policies are engrained in all day-to-day business
operations of the Company and are implemented at all management
levels. The overall implementation of BR policies of the Company is
done through the various Committee under the guidance of senior
management.
The Company has a formal grievance redressal mechanism to
address stakeholders concerns. Any grievance can be reported
on compliance.officer@erosintl.com. The BR head would be
responsible for addressing the concerns related to BR principles.
Policies are evaluated regularly by senior management.
10
Has the Company carried out independent audit/evaluation of the
working of this policy by an internal or external agency?
Linkage of Business Responsibility Policy
National Voluntary Guidelines (NVG) on Social, Environmental & Economic Responsibilities
Principle
No.
NVG Principle
Reference Document
1
2
Businesses should conduct and govern
themselves with Ethics, Transparency and
Accountability
Businesses should provide goods and services
that are safe and contribute to sustainability
throughout their life cycle
• Code of Business Conduct and Ethics for Directors, Key Managerial Personnel
and Senior Management Personnel
• EROS Code of Conduct for Employees
• Whistle Blower Policy
• Vendor Code of Conduct
• Corporate Governance Policy
• Policy on Anti-Bribery and Corruption
• Vendor Code of Conduct
66 AnnuAl RepoRt 2017-18
Directors’ report 3
Businesses should promote the well being of
all employees
• Board Diversity Policy
• Policy on equal work opportunities
• Vendor code of Conduct
• Policy on exit and termination
• Policy on leave
• Policy on Performance Appraisal
• Policy on Reimbursement
• Policy on Safety & Occupational Health
• Policy on Training & Development
• Policy on Sexual Harassment
• Policy on work place security
• Code for Independent Directors
• Code of Business Conduct and Ethics for Directors, Key Managerial Personnel
& Senior Management Personnel
• Corporate Social Responsibility Policy
Businesses should respect the interests of,
and be responsive towards all stakeholders,
especially
those who are disadvantaged,
vulnerable and marginalised
Businesses should respect and promote human
rights
• Vendor Code of Conduct
Businesses should respect, protect and make
efforts to restore the environment
• Corporate Social Responsibility Policy
• Vendor Code of Conduct
Businesses, when engaged
influencing
public and regulatory policy, should do so in a
responsible manner
in
Businesses should support inclusive growth
and equitable development
Businesses should engage with and provide
value to their customers and consumers in a
responsible manner
• Code of Business Conduct and Ethics for Directors, Key Managerial Personnel
and Senior Management Personnel
• Corporate Social Responsibility Policy
• Code of Business Conduct and Ethics for Directors, Key Managerial Personnel
and Senior Management Personnel
• Code of Business Conduct and Ethics for Directors, Key Managerial Personnel
and Senior Management Personnel
4
5
6
7
8
9
Links
Code of Business Conduct and Ethics for Directors, Key
Managerial Personnel and Senior Management Personnel
http://www.erosintl.com/wp-content/uploads/2017/02/Code-of-
Business-Conduct-and-Ethics.pdf
Code for Independent Directors
http://www.erosintl.com/wp-content/uploads/2018/04/Code-of-
Conduct-for-Independent-Directors.pdf
Whistle Blower Policy
• Policy on leave
• Policy on Performance Appraisal
• Policy on Reimbursement
• Policy on Safety & Occupational Health
• Policy on Training & Development
• Policy on Sexual Harassment
• Policy on work place security
• Eros Code of Conduct for Employees
http://www.erosintl.com/wp-content/uploads/2016/10/Whistle-Blower-
Policy (Vigil%20Mechanism).pdf
b)
If answer to the question at serial number 1 against any
principle, is ‘No’, please explain why:
Vendor Code of Conduct
http://www.erosintl.com/wp-content/uploads/2018/03/Vendor-Code-
of-Conduct-1.pdf
Corporate Social Responsibility
http://www.erosintl.com/wp-content/uploads/2018/04/Corporate-
Social-Responsibility-Policy-1.pdf
The below mentioned policies are available on the internal portal
of the Company at www.erosintl.com:
• Corporate Governance Policy
• Policy on Anti-Bribery and Corruption
• Board Diversity Policy
• Policy on equal work opportunities
• Policy on exit and termination
Not Applicable
3. Governance related to BR
a)
Frequency with which the Board of Directors, Committee
of the Board or CEO meet to assess the Company’s BR
performance
The assessment of BR performance is done on an ongoing basis
by the CSR Committee and Board of Directors of the Company.
b) BR and Sustainability Reports published; frequency and link
of published reports
The Company has started publishing BR report from financial
year 2016-17 on a yearly basis pursuant to Regulation 34(2)
(f) of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015. The BR report is published annually and shall
be available on our website at www.erosintl.com.
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Section E: Principle-wise Performance
Principle 1
ETHICS, TRANSPARENCY AND ACCOUNTABILITY
1. Does the policy relating to ethics, bribery and corruption apply
only the Company? Yes/No. Does it extend to the Group/Joint
Ventures/Suppliers/Contractors/NGOs/ Others?
The Company considers Corporate Governance as an integral part
of management. The Company has a Code of Business Conduct
and Ethics that is approved by the Board of Directors and this code
is applicable to all Board Members and Senior Management. The
code is available on the Company’s website at www.erosintl.com.
Additionally, to promote highest standards of professionalism,
honesty, integrity and ethical behavior, the Company has various
policies like Whistle Blower policy, Vendor Code of Conduct, Policy
on Anti-Bribery and Corruption in place. The Company follows
Zero tolerance on acts of bribery, corruption etc. during the dealing
with the vendors, suppliers, contractors, external stakeholders,
NGO’s etc.
The glimpses of our policies are as follows;
• Code of Business Conduct and Ethics for Directors, Key
Managerial Personnel & Senior Management Personnel:-
The policy is intended to provide guidance and help in
recognizing and dealing with ethical issues and to help foster a
culture of honesty and accountability.
• Employee Code of Conduct:-
The policy details the standards of personal and professional
behaviour of employees and maintain a healthy work environment.
• Whistle blower Policy:-
The policy enables the employees and stakeholders of the
Company to report to the management about any instances of
unethical behaviour.
• Vendor Code of Conduct:-
The policy details the high ethical standard to be followed by all
its Vendors while conducting any business activities with or on
our behalf of the Company.
• Policy on anti-bribery and corruption:-
The policy describes the zero tolerance on any acts of bribery,
corruption etc. by any of the stakeholders during the dealings
with the Company.
The Company’s philosophy on Corporate Governance is built
on a rich legacy of fair, transparent and effective governance.
To ensure that the principle of ethics, transparency and
accountability translates into consistent practice, the above
policies along with the board committees serve as enablers for
high standards of business conduct.
2. How many stakeholders’ complaints have been received
in the past financial year and what percentage was
satisfactorily resolved by the management? If so, provide
details thereof, in about 50 words or so.
Eros has established structured mechanisms to address concerns
of stakeholders and communicate their expectations which are
dealt by the Audit Committee. During the reporting period, we have
not received any complaints/ grievances from our stakeholders
regarding unethical business practices.
Principle 2
PRODUCTS LIFE CYCLE SUSTAINABILITY
1.
List up to 3 of your products or services whose design has
incorporated social or environmental concerns, risks and /
or opportunities:
Eros is a leading global company which co-produces, acquires and
distributes Indian language films in multiple formats. The Company
68 AnnuAl RepoRt 2017-18
meticulously follows applicable regulations and guidelines issued
by Central Board of Film certification, Ministry of Information
and Broadcasting etc. Additionally, the Company also publishes
disclaimers to address social and environmental issues as part of
the film screenings.
2.
For each such product, provide the following details in
respect of resource use (energy, water, raw materials etc.)
per product (optional):
The business operation of the Company is of providing service,
with minimal control over the procedures and practices followed
during the film shootings. However, the continuous efforts are
being made by the Company and its employees to ensure that
there is an optimum utilization of the available resources (like water,
energy etc.) with minimum or no wastages at all.
3. Does the Company have procedures in place for sustainable
sourcing (including transportation). If yes, what percentage
of your inputs was sourced sustainably?
The Company maintains a healthy relationship with its content
providers, vendors and other suppliers and the business policies of
the Company include them in its growth. The sustainability agenda
is extended to the suppliers/ vendors through the Vendor Code
of Conduct. The Vendor Code of Conduct ensures conformity
with the safe working conditions along with prohibition of child
labour, forced labour and abiding human rights principles in the
supply chain operations. The compliance with the Vendor Code
of Conduct is mandatory for conducting business operations with
Eros International.
4. Has Company taken any steps to procure goods and services
from local and small producers, including communities
surrounding their place of work? If yes, what steps have
been taken to improve the capacity and capability of local
and small vendors
The Company operates in the area of commercial hub and source
its services from local vendors and producers which contributes to
the growth of business operations.
5. Does the Company have a mechanism to recycle products
and waste? If yes what is the percentage of recycling of
products and waste. (Separately as <5%, 5-10 %, > 10%).
Also, provide details thereof, in about 50 words or so.
The business operations of the Company is to provide service,
hence it does not discharge any effluents or waste. However, the
Company has established various measures to diminish waste
generated on day to day basis, some of them include reducing
paper waste, water waste, plastic waste, etc.
E-waste is one of the fastest growing waste segments globally.
At Eros, we endeavor to mainstream sound e-waste management
across our operations. During the year, the Company disposed
off e-waste under the guidelines for environmentally sound
management of e-waste by Central Pollution Control Board and
Maharashtra Pollution Control Board. Also, the Corporate office of
the Company is located in a green building which on its own has
incorporated various sustainability measures.
Principle 3
EMPLOYEES’ WELL-BEING
1.
Please indicate the total number of employees:
The total number of employees are 285 as on 31 March 2018.
2.
Please indicate the total number of employees hired on
temporary/contractual/casual basis:
The total number of employees hired on contractual basis are 24
as on 31 March 2018.
3.
Please indicate the number of permanent women employees:
The total number of women employees are 53 as on 31 March 2018.
Directors’ report
4.
Please indicate number of permanent employee with
disabilities:
Eros has always advocated a business environment that favours
the concept of equal opportunity for all without any discrimination
with respect to caste, creed, gender, race, religion, disability or
sexual orientation. As on 31 March 2018, there is one disable
employee recruited by Eros.
5. Do you have employee association that is recognized by
management:
No employee association exists
6. What percentage of your permanent employees are
members of this recognized employee association.
NA.
7.
Please indicate the number of complaints relating to child
labour, forced labour, involuntary labour, sexual harassment
in the last financial year and pending as on the end of the
financial year.
No cases of child labour, forced labour, involuntary labour,
discriminatory employment and sexual harassment were reported
in the last financial year. The Company has in place the Prevention
of Sexual Harassment (POSH) Policy in line with the requirements
of the Sexual Harassment of Women at the Workplace (Prevention,
Prohibition & Redressal) Act, 2013, which ensures a free and fair
enquiry process with clear timelines. All employees (permanent,
contractual, temporary, trainees) are covered under this Policy.
Further, the Company has an Internal Complaints Committee
where employees can register their complaints against sexual
harassment.
8. What percentage of your above mentioned employees were
given safety and skill up-gradation training in the last year?
Training and development of people is given high importance in
Eros. The Company sponsors its employees to attend training
sessions organized by external professional bodies to facilitate
upgradation of skills of employees handling relevant functions. The
Company periodically performs safety trainings as well as mock
drills on fire and safety within the organisation for all the employees.
Principle 4
STAKEHOLDER’S ENGAGEMENT
1. Has the Company mapped
its
internal and external
shareholders?
The Company has mapped in its major internal and external
stakeholders. The major/key categories include (i) Central and State
Governments/regulatory authorities, viz. the Ministry of Information
& Broadcasting, the Department of Telecommunication, Ministry
of Corporate Affairs, Reserve Bank of India, Securities and
Exchange Board of India, Foreign Investment Promotion Board,
Stock Exchanges and Depositories, Producers, Vendors, Financial
Institutions, Banks, Investors and Service Providers.
However, the process of mapping of stakeholder is an ongoing
effort of updation on regular basis.
2. Out of the above, has the Company
identified the
disadvantaged, vulnerable and marginalized stakeholders?
Yes.
3. Are there any special initiatives taken by the Company to
engage with the disadvantaged, vulnerable and marginalized
stakeholders? If so, provide details thereof
While developing the CSR strategy, the Company has ensured
that all communities shall be benefited from our CSR activities,
with special focus on group that are socially and economically
marginalized.
The Company created awareness
for the blood donation
amongst its employees and organised blood donation camp in
collaboration with Think Foundation, NGO. The donated blood
aided transfusions to people affected by thalassemia, an inherited
autosomal recessive blood disorder that causes the weakening
and destruction of red blood cells.
Principle 5
HUMAN RIGHTS
1. Does the policy of the Company on human rights cover
only the Company or extend to the Group/Joint ventures/
suppliers/ contractors/ NGOs/Others?
Eros believes that an organization rests on foundation of business
ethics and valuing human rights, Eros adheres to all statutes
which embodies the principles of human rights such as women
empowerment, anti-sexual harassment etc. Eros promotes
awareness to the importance of human rights within its value chain
and discourage instance of any abuse, innocuous behavior within
the organization and its applicable to all the stakeholders.
2. How many stakeholder complaints have been received in
the past financial year and what percent was satisfactorily
resolved by the Management?
There were no complaints reported on violation of any human
rights during the financial year 2017-18.
Principle 6
ENVIRONMENT
1. Does the policy related to principle 6 cover only the
Company or extend to the Group/Joint ventures/ suppliers/
contractors/ NGOs/ Others?
is of prime
Nurturing and safeguarding the environment for long term
sustainability
importance. The Company, has
undertaken several green initiatives at all its office locations
during the year. Further, the Company’s vendors and suppliers
are required to comply with the Health Safety and Environment
(HSE) requirements as stated in the Vendor Code of Conduct
policy. The policy promotes sustainable usage of resources such
as energy and water and considers environment as integral part of
production/distribution activities.
2. Does the Company have strategies/initiatives to address
global environmental issues such as climate change, global
warming, etc? Y/N. If yes, please give hyperlink for webpage
etc.
Currently, the Company does not have any strategies/initiatives
to address environmental issues. Eros constantly endeavors to
reduce its impact on the environment and identify ways to optimize
resource consumption. To ensure the minimum impacts, it has
undertaken initiatives like reduction of paper usage, distribution of
films using digitisation methods etc.
The Company have its Corporate office in green building which
has incorporated various sustainability measures right from the
conceptual stage. It has received Gold certification under LEED
India Core & Shell rating system. Eros tries to integrate sustainable
measures in the day-to-day operations by reduction of paper
usage, maintenance of data and records in electronically, reduction
in usage of plastic bottles for drinking purpose etc.
3. Does
the company
identify and assess potential
environmental risks? Y/N
The Company, being a service provider, is not involved in any
manufacturing activity, thereby limiting the scope of handling
the environmental risks of any kind. However, the Company is
committed to safety and protecting the environment in which it
operates.
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4. Does the Company have any project related to Clean
Development Mechanism? If so, provide details thereof in
about 50 words or so. Also, if yes, whether any environmental
compliance report is filed?
As the Company is not involved in any manufacturing activity, no
specific project related to Clean Development Mechanism has
been undertaken by it.
5. Has Company undertaken any other initiatives on – clean
technology, energy efficiency, renewable energy etc? Y/N. If
yes, please give hyperlink to web page etc.
No, the Company is a service provider and is not involved in any
manufacturing activities.
6. Are the Emissions/Waste generated by the Company within
permissible limits given by CPCB/SPCB for the financial
year being reported?
Not Applicable.
2. Are the programmes/projects undertaken through in-house
team/own foundation external NGO/government structures/
any other organisation?
The Company generally undertakes CSR projects through various
implementing agencies such as NGO, non-profit organizations
etc. Requisite detail of entity through whom CSR initiatives are
proposed to be undertaken are included in the Annual Report on
CSR forming part of this Annual Report.
3. Have you done any impact assessment of your initiative?
The progress of the CSR initiative is periodically reviewed by the
CSR Committee.
4. What is Company’s direct contribution to community
development projects- Amount in INR and the details of the
projects undertaken?
For the FY 2017-18, the Company has spent INR Nil on community
development initiatives.
7. Number of show cause/legal notices received from CPCB/
SPCB which are pending (i.e. not resolved to satisfaction) as
of end of financial year.
5. Have you taken steps to ensure that this community
development initiative is successfully adopted by the
community?
Eros conducts consistent engagement and interaction with the
CSR initiatives implementing agencies to ensure that the initiatives
are successfully implemented and address specific needs of the
community.
Principle 9
CUSTOMER VALUE
1. What percentage of customer complaints/ consumer cases
are pending as on the end of financial year?
There are no material consumer cases / customer complaints
received in FY 2017-18.
2. Does the Company display product information on the
product label, over and above what is mandated as per local
laws?
Yes. The Company clearly communicates the requirements/
disclaimers as mandated by the regulatory bodies.
3.
Is there any case filed by any stakeholder against the
Company regarding unfair trade practices, irresponsible
advertising and or anti-competitive behavior during the last
five years and pending as of end of financial year?
There were no cases filed by any stakeholder against the Company
regarding unfair trade practices, irresponsible advertising and or
anti-competitive behavior during the last five years.
4. Did your Company carry out any consumer survey/consumer
satisfaction trends?
The Company develops a more collaborative relationship with
the consumers and places them at the center of the innovation
cycle. Through continuous engagement, Eros tries to generate
real value by which it can improve its services. It contributes
towards customers and the broader community by opening up
more choices in media and entertainment and bring people the
content they value and trust. The Company focuses on educating
customers and informing them through the various film content.
There are no pending or unresolved show cause/ legal notices from
CPCB/ SPCB in FY 2017-18.
Principle 7
POLICY ADVOCACY
1.
Is your Company a member of any trade and chambers or
association? If yes, name only those major ones that your
business deals with.
In order to drive advocacy globally, the Company has been part of
governance bodies of national and international organizations. The
Company actively partners with industry associations and forums
like:
The Indian Motion Picture Distributors Association
Motion Pictures Association
Central Circuit Cine Association
The Telangana Film Chamber of Commerce
Eastern India Motion Pictures Association
Nepal Motion Picture Association
The Chennai Kancheepuram Thiruvallur Districts Film Distributors
Association
B50 and Orrisa film distributors syndicate.
•
•
•
•
•
•
•
•
2. Have you advocated/lobbied through above associations
for advancement or improvement of public good? Yes/No; If
yes, specify the broad areas
No.
Principle 8
INCLUSIVE GROWTH AND EQUITABLE DEVELOPMENT
1. Does the Company have specified programmes/initiatives/
projects in pursuit of the policy related to Principle 8?
Eros, as a responsible corporate citizen, promotes sustainable and
inclusive development. Continuing to this path, Eros is committed
to integrate sustainability impact on society through its CSR
initiatives.
The Company undertakes these initiatives through the CSR
committee of the Board as per the CSR policy.
70 AnnuAl RepoRt 2017-18
Directors’ report
CORPORATE GOVERNANCE REPORT
THE COMPANY’S PHILOSOPHY ON CODE OF CORPORATE
GOVERNANCE
The Company considers fair and transparent corporate governance
as one of its most core management tenets. Corporate Governance
may be defined as a set of systems, policies, processes and principles
which ensures that a company is governed in the best interest of all
the stakeholders. It is the system by which companies are directed,
administered, controlled and managed. Good governance is about
promoting corporate fairness, transparency and accountability.
We strongly believe in the practice of conducting our business activities
in a fair, direct and completely transparent manner that will not only
benefit the Company but more importantly will ensure the highest level
of accountability and trust for all our stakeholders such as shareholders,
our employees and our partners. The timely disclosures, transparent
accounting policies and a strong and independent Board go a long way
in maintaining good corporate governance, preserving shareholders’
trust and maximizing long-term corporate value.
We, at Eros International, continuously strive at improving and adhering
to the good governance practice. The Company has adopted best
practices mandated in SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, as amended (hereinafter referred to
as the “SEBI Listing Regulations”).
Name of the Director
Directors
Identification
No. (DIN)
A report on compliance with the principles of Corporate Governance
as prescribed by SEBI in Chapter IV read with Schedule V of the SEBI
Listing Regulations is given below:
BOARD OF DIRECTORS
a. Composition and Category of Directors:
The Board of Directors along with its Committees provide leadership
and guidance to the Company’s management as also direct,
supervise and control the performance of the Company. The
Company has a balanced Board with combination of Executive
and Non-Executive Directors to ensure independent functioning.
As at 31 March 2018, the Board of Directors of the Company
consist of Six (6) Directors, out of which Three (3) are Non-
Executive Directors and Three (3) are Executive Directors, including
a Woman Director, comprising of experts from various fields/
professions. The Chairman of the Board, Mr. Dhirendra Swarup, is a
Non-Executive and
is not related
to promoters of the Company or any person occupying the
position one level below the Board. The Present composition
of the Board of Directors of the Company is in accordance with
the SEBI Listing Regulations and the Companies Act, 2013
(the “Act”) read with applicable Rules made thereunder.
Independent Director and
Category
Designation
Mr. Dhirendra Swarup1
02878434
Non-Executive & Independent Director
Chairman
Mr. Rakesh Sood
Mr. Sunil Arjan Lulla
Mr. Kishore Arjan Lulla
Mrs. Jyoti Deshpande2
07170411
Non-Executive & Independent Director
Director
00243191
Promoter & Executive Director
Executive Vice Chairman & Managing Director
02303295
Promoter & Executive Director
02303283
Executive Director
Director
Director
Mr. Subramaniam Lakshminarayanan3
07972480
Non-Executive & Independent Director
Additional Director
Mr. Sunil Srivastav4
00237561
Non-Executive & Independent Director
Additional Director w.e.f. 23 May 2018
During the year ended 31 March 2018, Mr. Naresh Chandra, ceased
to be a Non-Executive Independent Director of the Board and its
Committee w.e.f. 9 July 2017 on account of his sudden and sad
demise. The Board had re-designated Mr. Dhirendra Swarup, Non-
Executive Independent Director as a Chairman of the Board w.e.f.
11 August 2017
in place of Late Mr. Naresh Chandra.
Mr. Kishore Arjan Lulla, Executive Director of the Company was
reappointed by the Shareholders at the Annual General Meeting
of the Company held on 28 September 2017 for a period of Five
(5) years commencing 1 November 2017. Mr. Subramaniam
Lakshminarayanan, was appointed as a Non-Executive Additional
Independent Director on the Board of the Company with effect
from 14 November 2017 to hold office up to the date of the ensuing
Annual General Meeting. Mr. Sunil Srivastav was appointed as a
Non-Executive Additional Independent Director on the Board of
the Company with effect from 23 May 2018 to hold office up to the
date of the ensuing Annual General Meeting.
There are no Institutional Nominee Directors on the Board. The
Company has in place the Succession Policy for appointments at
the Board and to Senior Management level.
Independent Directors
The Independent Directors of the Company are Non-Executive
Directors as defined under Section 149(6) of the Act read with
Regulation 16(1)(b) of the SEBI Listing Regulations. Independent
Directors of the Company provide appropriate annual certifications
to the Board confirming satisfaction of the conditions of their being
independent as laid down in Section 149(6) of the Act and Regulation
16(1)(b) of the SEBI Listing Regulations. They possess rich and
varied experience with skills in critical areas like governance,
finance, entrepreneurship, general management etc. All
Non-Executive Directors of the Company as on 31 March 2018
are Independent.
As required by Regulation 46 of the SEBI Listing Regulations, the
terms and conditions of appointment of Independent Directors
are listed down in the draft letter of appointment, available on
the Company’s website at www.erosintl.com. Each Independent
director has been issued formal letter of appointment.
Independent Directors Meeting
During the year under review, a separate meeting of the Independent
Directors was held on 28 September 2017, without the attendance
of Non-Independent Directors and Management Personnel.
Various matters were discussed by the Independent Directors at
the said meeting, including, inter alia, matters as prescribed in the
Schedule IV of the Act and SEBI Listing Regulations, viz. review of
the performance of Non-Independent Directors and the Board as
whole, review of the performance of the Chairman, assessed the
quality, quantity and timeliness of flow of information between the
Company's management and the Board, that is necessary for the
1 Mr. Dhirendra Swarup was appointed as a Chairman of the Board with effect from 11 August 2017.
2 Mrs. Jyoti Deshpande designation has been changed to Non-Executive Non-Independent Director with effect from 1 April 2018.
3 Mr. Subramaniam Lakshminarayanan was appointed as a Non-Executive Additional Independent Director on the Board with effect from 14 November 2017.
4 Mr. Sunil Srivastav has been appointed as a Non-Executive Additional Independent Director on the Board with effect from 23 May 2018.
EROS IntERnatIOnal MEdIa lIMItEd 71
Corporate overview | ManageMent report | finanCial management
Board to effectively and reasonably perform their duties. All the
Independent Directors attended the said Meeting.
Reappointment of Directors
from Executive Director
The designation of Mrs. Jyoti Deshpande (DIN-02303283),
was changed
to Non-Executive
Non-Independent Director of the Company w.e.f. 1 April 2018.
Mrs. Jyoti Deshpande, being eligible for re-appointment, has offered
herself for re-appointment, as her office being longest and is liable to
retire by rotation at the 24th Annual General Meeting of the Company,
as per Section 152(6) of the Act and applicable Rules thereto.
As required under SEBI Listing Regulations, brief resume of
Mrs. Jyoti Deshpande, seeking
re-appointment as Non-
Executive Non-Independent Director at the ensuing Annual
General Meeting is stated at length in the Notice convening
24th Annual General Meeting.
b. Attendance of Directors and Number of other Directorship:
Details of Membership and Attendance of each Director at the
Board of Directors Meetings held during the financial year under
review and the last Annual General Meeting and the number of
other Directorships and Chairmanship/Membership of Board
Committees as on 31 March 2018 are as follows:
Name of Director
Directors
Identification No.
(DIN)
Attendance
Position on the Board of other companies as on
31 March 2018
Mr. Naresh Chandra5
Mr. Dhirendra Swarup
Mr. Rakesh Sood
Mr. Sunil Arjan Lulla
Mr. Kishore Arjan Lulla
Mrs. Jyoti Deshpande
Mr. Subramaniam Lakshminarayanan6
00015833
02878434
07170411
00243191
02303295
02303283
07972480
Board
Meeting
1
4
4
4
2
4
2
Last
Annual
General
Meeting
N.A.
Yes
Yes
Yes
No
Yes
N.A.
Directorship*
(Including
Unlisted Public
Companies)
-
3
2
7
-
2
-
Committee
Membership**
Committee
Chairmanship**
-
3
2
1
-
-
-
-
2
1
-
-
-
-
Note:
* Only Public limited companies, (both listed and unlisted) are included in other directorships. Directorships in all other companies including private
limited companies (which are not the subsidiary of Public Company), foreign companies and companies under Section 8 of the Act are excluded.
** Chairmanship/Membership of the Audit Committee and the Stakeholders’ Relationship Committee are considered for the purpose of committee
positions in all public companies, whether listed or not as per SEBI Listing Regulations and it also includes the committees in which a Director holds
position as a Chairman.
c. Number of Directorship(s)/ Chairmanship(s)/ Membership(s):
None of the Director of the Company holds directorships in
more than Ten (10) public companies. Further, none of them is a
member of more than Ten (10) committees or chairman of more
than Five (5) committees across all the public companies in which
he/she is a director.
Further, none of the Independent Director of the Company is
acting as an Independent Director in more than Seven (7) listed
companies or acting as whole-time director in more than Three (3)
listed companies.
Necessary disclosures regarding directorships and committee
positions in other public companies as on 31 March 2018 have been
made by all the Directors of the Company.
d. Number of Board Meetings:
The Board met Four (4) times during the financial year ended
31 March 2018, i.e. on 26 May 2017; 11 August 2017;
14 November 2017 and 8 February 2018. The maximum time
gap between Two (2) meetings of the Board did not exceed
One Hundred and Twenty (120) days as stipulated under the
Regulation 17(2) of the SEBI Listing Regulations. The necessary
quorum was present for all the meetings.
The Board meets at regular intervals to discuss and decide on
business policy of the Company and strategy apart from other Board
business. The Board/Committee Meetings are pre-scheduled and
tentative dates of the Board and Committee Meetings are informed
well in advance to facilitate Directors to plan their schedule. The
agenda is circulated well in advance to the Board Members, along
with comprehensive background information on the agenda items
to enable the Board to take an informed decision. The agenda
and related information is circulated to the Board/Committee by
uploading the same on e-meeting application, which is accessible
to all the Members of the Board and its Committee on their
respective i-pads. This has reduced paper consumption, thereby
leveraging the technology and holding paperless meetings. Notice,
Agendas and minutes of the meeting are all circulated through
electronic means. Detailed presentations and notes are laid
before each meeting, by the management and senior executives
of the Company, to apprise the Board on overall performance on
quarterly basis. Additional items on the agenda are permitted with
the permission of the Chairman and with the consent of all the
Directors present at the meeting. Senior Executives/Management
of the Company are invited to attend the Meetings of the Board
and Committees, to make presentations and provide clarifications
as and when required.
In accordance with the Act read with the Companies (Meetings
of Board and its Powers) Rules, 2014 and in accordance with
Secretarial Standard 1 issued by the Institute of Company
Secretaries of India, the Company provides an option to its
Directors to participate at each of the Board Meetings/Committee
Meetings through video conference except in respect of those
agenda items wherein transactions are not permitted to be carried
out by way of video conference. As per Secretarial Standards, draft
minutes and signed minutes of the Meeting are circulated within
the prescribed time.
The Board of Directors has complete access to the information
within the Company.
e. Disclosure of Relationship between directors:
Mr. Kishore Arjan Lulla, Executive Director and Mr. Sunil Arjan Lulla,
Executive Vice Chairman and Managing Director of the Company,
are brothers.
5 Mr. Naresh Chandra ceased to be a Director of the Company with effect from 9 July 2017 on account of his death.
6 Mr. Subramaniam Lakshminarayanan was appointed as a Non-Executive Additional Independent Director on the Board w.e.f. 14 November 2017.
72 annual REpORt 2017-18
CORPORATE GOVERNANCE REPORT
Other than the aforesaid, there are no inter-se relationships
amongst the Directors.
Following Committee(s) are constituted for better and focused attention
on various affairs of the Company:
f.
Number of Shares held by Non-Executive Directors:
As on 31 March 2018, none of the Non-Executive Independent
Directors holds any equity shares in the Company.
g.
Familiarisation Programme for Independent Directors:
Familiarisation Programme for Independent Directors is designed
with an aim to make the Independent Directors aware about
their roles, responsibilities and liabilities as per the Act, SEBI
Listing Regulations and other applicable laws and to get better
understanding about the Company, nature of industry in which it
operates and environment in which it functions, business model,
long term/short term/strategic plans etc. As a part of familiarisation
programme, the Company makes presentations to the Board
members, inter alia, covering business environment, business
strategies, operations review, quarterly and annual results, review
of Internal Audit Report and action taken, statutory compliance, risk
management, operations of subsidiaries, etc.
The relevant policies of the Company including the Code of
Conduct for Board Members and Senior Management Personnel
and the Code of Conduct to regulate, monitor and report trading
by Insiders etc. are circulated to the Directors and uploaded on
e-meeting application on i-pads for easy access.
The familiarisation programme and necessary disclosures to be
made in accordance with SEBI Listing Regulations are made on
the website of the Company at www.erosintl.com.
COMMITTEES OF THE BOARD
The Board of Directors, at its various meetings, has constituted/
re-constituted various committees to discuss upon the delegated work
as per their respective charters. The Board supervises the execution
of its responsibilities by the Committees and is responsible for their
action. Minutes of all the Committee Meetings are placed before the
Board for noting.
•
•
•
•
•
Audit Committee
Nomination and Remuneration Committee
Stakeholders Relationship Committee
Corporate Social Responsibility Committee
Management Committee
AUDIT COMMITTEE
An Audit Committee, duly constituted by the Board of Directors has
a well-defined composition of members, terms of reference, powers,
role and responsibilities in accordance with Section 177 of the Act and
applicable Rules thereto and in accordance with Regulation 18 of SEBI
Listing Regulations.
As on 31 March 2018, the Audit Committee comprised of Four (4)
members of whom Three (3) are Non-Executive Independent Directors,
all of whom are financially literate and possesses accounting and related
financial management expertise. The Chairman of the Audit Committee is
an Independent Director and he had attended last year’s Annual General
Meeting to address the queries of the shareholders.
The detailed terms of reference of Audit Committee along with working
procedure, charter and constitution are uploaded on website of the
Company at www.erosintl.com.
Meeting Details:
the year under
During
review, Audit Committee met Four
(4) times in a year viz. on 26 May 2017; 11 August 2017;
14 November 2017 and 8 February 2018. The maximum time gap
between Two (2) Committee Meetings did not exceed One Hundred and
Twenty (120) days as stipulated under the Regulation 18(2) of SEBI Listing
Regulations. The necessary quorum was present for all the Meetings.
Composition of the Audit Committee and the attendance of each
Member at the said Committee Meetings are set out in following table:
Name of Committee Member
Directors Identification
No. (DIN)
Designation in
the Committee
Category
Number of
Meetings attended
Mr. Dhirendra Swarup
Mr. Naresh Chandra7
Mr. Rakesh Sood
Mr. Sunil Arjan Lulla
02878434
00015833
07170411
00243191
Chairman
Non-Executive Independent Director
Member
Non-Executive Independent Director
Member
Non-Executive Independent Director
Member
Executive Vice Chairman and
Managing Director
Mr. Subramaniam Lakshminarayanan8
07972480
Member
Non-Executive Independent Director
4
1
4
4
2
The Company Secretary and Compliance Officer acts as the Secretary
to the Committee. The Chief Financial Officer of the Company is the
permanent invitee to the Committee meetings. The Audit Committee also
invites senior executives/management including the representatives of
the statutory auditors and internal auditors at its meetings.
Annual General Meeting to address the queries of the shareholders.
The detailed terms of reference of Nomination and Remuneration
Committee along with working procedure, charter and constitution are
uploaded on website of the Company at www.erosintl.com.
NOMINATION AND REMUNERATION COMMITTEE
Meeting Details:
The Nomination and Remuneration Committee is constituted in
accordance with Section 178 of the Act and applicable Rules thereto
and in accordance with Regulation 19 of SEBI Listing Regulations. As on
31 March 2018, the Nomination and Remuneration Committee comprised
of Three (3) Members, all of whom are Non-Executive Independent
the Nomination and Remuneration
Directors. The Chairman of
Committee is an Independent Director and he was present at last year’s
During the year under review, Nomination and Remuneration Committee
met Four (4) times in a year viz. on 26 May 2017; 11 August 2017;
14 November 2017 and 8 February 2018. The necessary quorum was
present at all the meetings.
Composition of the Nomination and Remuneration Committee and the
attendance of each member at the said Committee Meetings are set out
in following table:
7 Mr. Naresh Chandra ceased to be a Member of the Audit Committee with effect from 9 July 2017 on account of his death.
8 Mr. Subramaniam Lakshminarayanan became Member of the Audit Committee w.e.f. 14 November 2017.
EROS IntERnatIOnal MEdIa lIMItEd 73
Corporate overview | ManageMent report | finanCial management
Name of Committee Member
Directors
Identification No.
(DIN)
Designation
in the
Committee
Category
Mr. Rakesh Sood
Mr. Dhirendra Swarup
Mr. Naresh Chandra9
Mr. Subramaniam Lakshminarayanan10
07170411
02878434
00015833
07972480
Chairman
Non-Executive Independent Director
Member
Non-Executive Independent Director
Member
Non-Executive Independent Director
Member
Non-Executive Independent Director
Number of
Meetings
attended
4
4
1
2
The Company Secretary and Compliance Officer acts as the Secretary
to the Committee. The Chief Financial Officer of the Company is the
permanent invitee to the Committee Meetings.
Evaluation of performance of the Board, its Committees and
Directors:
The Company has formulated a Policy on Board Evaluation in accordance
with the applicable provisions of SEBI Listing Regulations and the Act.
An annual performance evaluation of the Board its Committees and
individual directors (including independent directors and Chairperson)
in an independent and fair manner was carried out in accordance with
the Company’s Board Evaluation Policy for the financial year ended
31 March 2018.
The performance of the Board and individual directors was evaluated
by the Board seeking inputs from all the Directors. The performance
of the Committees was evaluated by the Board seeking inputs
from the Committee Members. The Nomination and Remuneration
Committee reviewed the performance of the individual directors. This
was followed by a Board Meeting that discussed the performance of
the Board, its Committees and individual directors. A separate meeting
of Independent Directors was also held to review the performance of
Non-Independent Directors, performance of the Board as a whole and
performance of the Chairman of the Company.
The criteria for performance evaluation of the Board included aspects
like Board composition and structure, effectiveness of Board processes,
information and functioning etc. The criteria for performance evaluation
of Committees of the Board included aspects like composition of
committees, effectiveness of Committee Meetings etc. The criteria for
performance evaluation of the individual directors included aspects on
contribution to the Board and Committee Meetings like preparedness on
the issues to be discussed, meaningful and constructive contribution and
inputs in meetings etc. In addition, performance of the Chairman was also
evaluated on the key aspects of his role and responsibilities.
The performance evaluation of Independent Directors were based
on the criteria viz. attendance at Board and Committee Meetings,
skill, experience, ability to challenge views of others in a constructive
manner, knowledge acquired with regard to the Company’s business,
understanding of industry and global trends etc.
REMUNERATION OF DIRECTORS
Non – Executive Directors Compensation and Disclosures:
The Non-Executive Independent Directors are paid compensation in the
following manner:
• Sitting Fees of ` 40,000/- for attending each Board and Committee
Meeting.
• Commission, as decided by the Board, not exceeding 1% of the Net
Profit of the Company is paid in accordance with the Act.
• None of the Non-Executive Independent Directors have any pecuniary
relationship with the Company.
• None of the Non-Executive Independent Directors holds any equity
shares of the Company.
• None of the Non-Executive
Independent Directors hold any
convertible instruments in the Company.
• Payment of reimbursement of expenses incurred by Non-Executive
Independent Directors for participation in the Board and other
meetings of the Company.
Maintenance of Chairman’s Office
The Company maintains the office of Chairman, being Non-Executive,
and reimburses all the expenses incurred by him towards performance of
his duties, up to the limit as decided by the Board of Directors.
Details of remuneration paid to all the Directors for the financial year
2017-2018 are as follows:
Name of Director
Salary
Sr.
No.
Benefits /
Perquisites
Bonus Sitting Fees
(paid)
Commission
paid for FY
2016-17
Commission
(payable for
2017-18)
Total
(1+2)
1 Mr. Naresh Chandra11
2 Mr. Dhirendra Swarup
3 Mr. Rakesh Sood
4 Mr. Subramaniam
Lakshminarayanan12
-
-
-
-
-
-
-
-
5 Mr. Sunil Arjan Lulla
4,25,17,464
12,39,600
6 Mr. Kishore Arjan Lulla 1,27,55,244
-
7 Mrs. Jyoti Deshpande
1,15,95,672
135,98,50,000
-
-
-
-
-
-
-
(1)
(2)
1,60,000
49,75,000
13,63,014
51,35,000
6,80,000
24,87,500
48,76,209
31,67,500
8,00,000
24,87,500
27,77,113
32,87,500
9,33,664
2,40,000
240,000
-
-
-
-
-
-
-
Holding of Equity
Shares / stock
options of the
Company as on
31 March 2018
Nil
Nil
Nil
Nil
-
-
-
4,37,57,064
1,27,55,244
7,14,45,672
1,400 (Equity
Shares)
Nil
211,160 (options
outstanding) &
holds 360,000
Equity Shares
9 Mr. Naresh Chandra ceased to be a Member of the Nomination and Remuneration Committee w.e.f. 9 July 2017 on account of his death.
10 Mr. Subramaniam Lakshminarayanan became Member of the Nomination and Remuneration Committee w.e.f. 14 November 2017.
11 On demise of Mr. Naresh Chandra, he ceased to be the director of the Company w.e.f. 9 July 2017.
12 Mr. Subramaniam Lakshminarayanan was appointed as an Non-Executive Additional Independent Director on 14 November 2017.
13 Mrs. Jyoti Deshpande – perquisite amount is on account of ESOP allotment.
74 annual REpORt 2017-18
CORPORATE GOVERNANCE REPORT STAKEHOLDERS RELATIONSHIP COMMITTEE
is constituted
The Stakeholders Relationship Committee
in
accordance with Section 178 of the Act and applicable Rules thereto
and in accordance with Regulation 20 of SEBI Listing Regulations.
As on 31 March 2018, the Stakeholders Relationship Committee
comprised of Three (3) Members, majority of whom are Non-Executive
Independent Directors. The Chairman of the Stakeholders Relationship
Committee is an Independent Director and he was present at last year’s
Annual General Meeting to address the queries of the shareholders.
The detailed terms of reference of Stakeholders Relationship Committee
along with working procedure, charter and constitution are uploaded on
website of the Company at www.erosintl.com.
Meeting Details:
During the year under review, Stakeholders Relationship Committee
met Four (4) times in a year viz. on 26 May 2017; 11 August 2017;
14 November 2017 and 8 February 2018. The necessary quorum was
present at all the Meetings.
Composition of the Stakeholders Relationship Committee and the attendance of each member at the said Committee Meetings are set out in the
following table:
Name of Committee
Member
Directors Identification
No. (DIN)
Designation in
the Committee
Category
Number of Meetings
attended
Mr. Rakesh Sood
Mr. Dhirendra Swarup
Mr. Sunil Arjan Lulla
07170411
02878434
00243191
Chairman
Non-Executive Independent Director
Member
Non-Executive Independent Director
Member
Executive Vice Chairman and Managing Director
4
4
4
The Company Secretary and Compliance Officer of the Company acts
as the Secretary to the Committee. The Chief Financial Officer of the
Company is the permanent invitee to the Committee Meetings.
The functions and powers of the Stakeholders Relationship Committee
includes resolving of investor’s complaints pertaining to share transfers,
non-receipt of annual reports, dividend payments, issue of duplicate
share certificates, transmission of shares and other shareholder related
queries, complaints, maintaining investor relations etc.
The main objective of Stakeholders Relationship Committee is to ensure
effective implementation and monitoring of framework devised to avoid
insider trading and abusive self-dealing, ensure effective implementation
of whistle blower mechanism offered to all the stakeholders to report
any concerns about illegal or unethical practices, consider and resolve
the grievances of security holders of the Company, approval of transfer,
transmission of shares, and other securities of the Company, issue of
duplicate certificates on split, carrying out any other function contained
in the SEBI Listing Regulations, as and when amended from time to time.
Status of Investor Grievances during the year 2017-18:
Description of Investors Grievances received
during the year
No. of
Grievances
Total Grievances Pending at the Beginning of Period
as on 1 April 2017
NIL
Letters directly received from Investors
N.S.E.
B.S.E.
SEBI (Securities Exchange Board of India) (SCORES)
Total Grievances attended
2
3
0
0
5
Total Grievances pending as on 31 March 2018
NIL
All the Complaints received were promptly resolved and there was no
outstanding complaint as on 31 March 2018.
Share Transfer System:
Share transfers in physical form are registered and returned within the
stipulated time if documents are complete in all respects. The Company
obtains from Company Secretary in Practice half yearly certificate to the
effect that all certificates have been issued within thirty days of the date
of lodgement of the transfer, sub-division, consolidation and renewal as
required under Regulation 40(9) of the SEBI Listing Regulations and files
a copy of the said certificate with Stock Exchanges. There are no share
transfer pending as on 31 March 2018.
CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
The Corporate Social Responsibility (CSR) Committee is constituted in
accordance with Section 135 of the Act and applicable Rules thereto.
As on 31 March 2018, the Corporate Social Responsibility Committee
comprised of Four (4) members. The Chairman of the Corporate Social
Responsibility Committee is an Independent Director.
The objective of the CSR Committee is to implement the CSR
activities as per the CSR policy of the Company as stated at length in
Directors Report and to assess the various initiatives forming part of
the Business Responsibility performance of the Company.
The detailed terms of reference of Corporate Social Responsibility
Committee along with working procedure, charter and constitution are
uploaded on website of the Company at www.erosintl.com.
Meeting Details:
During the year under review, Corporate Social Responsibility
Committee met Four (4) times in a year viz. on 26 May 2017;
11 August 2017; 14 November 2017 and 8 February 2018. The
necessary quorum was present at all the Meetings.
Composition of the Corporate Social Responsibility Committee and the
attendance of each member at the said Committee Meetings are set out
in following table:
Name of Committee
Member
Directors Identification
No. (DIN)
Designation in
the Committee
Category
Number of Meetings
attended
Mr. Naresh Chandra14
Mr. Rakesh Sood15
Mr. Sunil Arjan Lulla
Mr. Kishore Arjan Lulla
Mrs. Jyoti Deshpande16
00015833
07170411
00243191
02303295
02303283
Chairman
Non-Executive Independent Director
Chairman
Non-Executive Independent Director
Member
Executive Vice Chairman and Managing Director
Member
Executive Director
Member
Executive Director
1
3
4
2
4
14 Mr. Naresh Chandra ceased to be the Chairman of the Corporate Social Responsibility Committee w.e.f. 9 July 2017 on account of his death.
15 Mr. Rakesh Sood became Member and Chairman of the Corporate Social Responsibility Committee w.e.f. 4 August 2017.
16 Mrs. Jyoti Deshpande desination has been changed to Non-Executive Non-independent Director w.e.f. 1 April 2018.
EROS IntERnatIOnal MEdIa lIMItEd 75
Corporate overview | ManageMent report | finanCial management The Company Secretary and Compliance Officer acts as the Secretary
to the Committee. The Chief Financial Officer of the Company is the
permanent invitee to the Committee Meetings. A detailed Business
Responsibility Report in terms of the provisions of Regulation 34 of the
SEBI Listing Regulations, forms part of this Annual Report.
MANAGEMENT COMMITTEE
The Board of Directors of the Company have constituted the
Management Committee to look after day to day affairs and functioning
of the Company. The Board have delegated certain powers to this
Committee. As at 31 March 2018, the Management Committee
comprised of directors and senior executives of the Company viz.
Mr. Sunil Arjan Lulla, Mr. Kishore Arjan Lulla, Mrs. Jyoti Deshpande and
Mr. Farokh P. Gandhi.
During the year under review, Mr. Dinesh Modi resigned as Group Chief
Financial Officer (India) of the Company at the close of business hours on
8 March 2018 and he also ceased to be the Member of the Management
Committee. Mr. Farokh P. Gandhi was appointed as Chief Financial
Officer of the Company w.e.f. 9 March 2018 and also appointed as a
Member of the Management Committee.
Mrs. Jyoti Deshpande ceased to be the Member of the Management
Committee w.e.f. 1 April 2018 due to her change in designation to
Non-Executive Non-Independent Director of the Company.
The Committee met Eighteen (18) times during the financial year for such
operational matters.
INVESTORS INFORMATION
General Body Meeting
Details of previous three Annual General Meetings of the Members are as under:
Respective Financial Year
2014-15
2015-16
2016-17
Date of the Meeting
3 September 2015
29 September 2016
28 September 2017
Time of the Meeting
3.00 P.M.
2.30 P.M.
2.30 P.M.
Venue of the Meeting
The Club, 197, D. N. Nagar,
Andheri West, Mumbai - 400 053.
The Club, 197, D. N. Nagar,
Andheri West, Mumbai - 400 053.
The Club, 197, D. N. Nagar,
Andheri West, Mumbai - 400 053.
Special Resolution passed at
the meeting
• Re-appointment of Mr. Sunil
Arjan Lulla
(DIN 00243191) as
an Executive Vice Chairman and
Managing Director of the Company
and payment of remuneration.
Not Applicable
of
• Payment
remuneration
to
Mrs. Jyoti Deshpande, Executive
Director (DIN-02303283) on her re-
appointment as Executive Director.
• Adoption of Articles of Association.
• Payment of Commission to Non-
Executive Directors.
• Approval for entering into Material
Related Party Transaction with Eros
Worldwide FZ LLC.
remuneration
• Payment of
to
Mr. Kishore Arjan Lulla
(DIN
02303295) on his reappointment as
Executive Director.
• Approval of Eros
International
Media Limited – Employee Stock
Options Scheme 2017 and grant
of stock options to the Employees
of the Company under the said
scheme.
• Grant of stock options to the eligible
employees of
the Company’s
subsidiaries and Holding Company
under the Eros International Media
Limited – Employee Stock Options
Scheme 2017.
RESOLUTIONS PASSED BY WAY OF CONDUCTING THE POSTAL BALLOT:
During the year under review, no special resolutions were passed through Postal Ballot pursuant to the provisions of Section 110 of the Companies
Act, 2013 read with the Rule 22 of the Companies (Management and Administration) Rules, 2014.
No special resolution is proposed to be conducted through postal ballot as on the date of this report.
MEANS OF COMMUNICATION
The Company has always promptly reported to both the stock exchanges where the securities of the Company are listed, all the material information
including declaration of quarterly, half yearly and annual financial results in the prescribed formats and through press releases.
Financial results are published in “The Free Press Journal” and “Navshakti” as per the requirements of the SEBI Listing Regulations. The said results
are also made available on Company’s website at www.erosintl.com.
Presentation to Institutional Investors / Analysts
Any Conference call of the Company with Analysts are intimated to the Stock exchanges in advance, also the official news releases are displayed on
the website of the Company.
76 annual REpORt 2017-18
CORPORATE GOVERNANCE REPORT GENERAL SHAREHOLDERS INFORMATION:
Day
Date
Time
Venue
Annual General Meeting
Thursday
27 September 2018
2:00 P.M.
The Club, 197, D. N. Nagar, Andheri West, Mumbai - 400 053.
Financial Calendar (Tentative)
Audited Annual Results of previous year ended 31 March 2018
Fourth Week of May 2018
1st quarter results for quarter ending June 2018
On or before 14 August 2018
2nd quarter results for quarter ending September 2018
On or before 14 November 2018
3rd quarter results for quarter ending December 2018
On or before 14 February 2019
Last quarter results for quarter ending March 2019
On or before 30 May 2019
Financial year
Book Closure Dates
Listing of equity shares at Stock Exchanges
Stock Codes
ISIN Number
1 April 2018 to 31 March 2019
20 September 2018 to 27 September 2018
BSE Limited
Pheeroze Jeejeebhoy Towers,
Dalal Street, Fort,
Mumbai-400 001.
Tel No:- +91-22-22721233/1234
Fax No:- +91-22-22721919
National Stock Exchange of India Limited
Exchange Plaza, 5th Floor,
Plot No- C Block, G Block,
Bandra Kurla Complex,
Mumbai-400 051.
Tel No:- +91-22-26598100-8114
Fax No:- +91-22-26598120
BSE - 533261
NSE – EROSMEDIA
INE416L01017
Corporate Identification Number (CIN)
L99999MH1994PLC080502
The Annual Listing Fees for the financial year 2018-2019 to BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) has been paid by
the Company within prescribed time.
The Annual Custodian Fees for the financial year 2018-2019 to National Securities Depository Limited (NSDL) and Central Depository Services (India)
Limited (CDSL) has been paid by the Company within prescribed time.
MARKET PRICE DATA
The equity shares of the Company are listed on the BSE Limited and the National Stock Exchange of India Limited. The monthly high and low share
prices on both the exchanges for a period starting from 1 April 2017 to 31 March 2018 are as below:
Month
April 2017
May 2017
June 2017
July 2017
August 2017
September 2017
October 2017
November 2017
December 2017
January 2018
February 2018
March 2018
BSE Limited (BSE)
National Stock Exchange of India Limited (NSE)
High Price (`)
Low Price (`)
Volume
High Price (`)
Low Price (`)
Volume
282.00
249.50
257.30
245.40
230.00
228.00
238.80
224.60
218.00
259.85
219.00
202.20
214.75
205.50
211.95
208.60
171.35
194.65
208.65
193.75
191.40
199.05
178.00
163.50
33,39,911
67,76,822
32,28,744
46,54,580
40,45,087
34,66,068
27,51,149
23,72,155
15,18,609
63,70,272
31,58,885
33,57,927
281.85
249.80
257.55
245.30
229.00
227.80
239.00
224.75
217.50
259.85
218.00
202.30
215.00
205.00
211.25
208.30
171.25
194.55
208.30
193.25
192.30
198.55
178.15
163.20
1,89,41,075
2,75,71,594
1,62,32,521
2,61,31,158
1,91,68,457
1,84,75,611
1,60,64,327
1,37,91,507
87,34,439
3,37,14,792
1,52,50,930
1,09,31,614
EROS IntERnatIOnal MEdIa lIMItEd 77
Corporate overview | ManageMent report | finanCial management PERFORMANCE IN COMPARISON TO BROAD BASED INDICES
A pr-17
M ay-17
Jun-17
Jul-17
A u g-17
S e p-17
O ct-17
N ov-17
D ec-17
Jan-18
Fe b-18
M ar-18
40000
35000
30000
25000
20000
15000
10000
5000
0
11500
11000
10500
10000
9500
9000
8500
8000
300
250
200
150
100
50
0
300
250
200
150
100
50
0
BSE Sensex
Eros Share Price
Nifty Sensex
Eros Share Price
A pr-17
M ay-17
Jun-17
Jul-17
A u g-17
S e p-17
O ct-17
N ov-17
D ec-17
Jan-18
Fe b-18
M ar-18
REGISTRAR TO AN ISSUE AND SHARE TRANSFER AGENTS
DISTRIBUTION OF SHAREHOLDING AS ON 31 March 2018
Address for Investor Correspondence
Shares Holding of Shares
No. of Shareholders % to Total
any
assistance
For
shares,
re-materialization of shares, share transfers, transmissions, change of
address, non-receipt of dividend or any other query relating to shares,
please write to:
regarding dematerialization of
LINK INTIME INDIA PRIVATE LIMITED
Unit – Eros International Media Limited
C 101, 247 Park,
LBS Marg, Vikhroli West,
Mumbai 400 083, Maharashtra (India).
Tel: +91 (22) 49186000
Fax: +91 (22) 49186060
Email: rnt.helpdesk@linkintime.co.in and mumbai@linkintime.co.in
Web: www.linkintime.co.in
78 annual REpORt 2017-18
1-5000
5001-10000
10001-20000
20001-30000
30001-40000
40001-50000
50001-100000
100001 and above
Total
PLEDGE OF SHARES
44,049
90.69
2,026
1,072
372
178
167
286
422
48,572
4.17
2.21
0.77
0.37
0.34
0.59
0.86
100
2,01,88,136 Equity Shares have been pledged by Eros Worldwide FZ
LLC, Holding Company as on 31 March 2018.
CORPORATE GOVERNANCE REPORT DEMATERIALISATION OF SHARES AND LIQUIDITY AS ON
31 March 2018
The securities of the Company are compulsory traded in dematerialised
form and are available for trading on both the depositories in India viz.
National Securities Depository Limited (NSDL) and Central Depository
Services (India) Limited (CDSL). Equity Shares of the Company
representing 99.99% of the Company’s Equity Share Capital are in
dematerialised form as on 31 March 2018 and the entire promoters
holding have been held in the dematerialised form as on 31 March 2018.
Break up of Shares in physical and demat form as on 31 March 2018
is as follows:
Number of
Shares
% of Total
Number of Shares
Details of Non-Compliance
No penalties have been imposed on the Company by the Stock
Exchanges, SEBI or any other statutory authorities on any matter related
to Capital markets during the last three years.
Whistle Blower Policy
The Whistle Blower Mechanism (vigil mechanism) in the Company
enables all the directors, employees and its stakeholders, to report
concerns about unethical behaviour, actual or suspected fraud or
violation of the Company’s code of conduct or ethics policy. This
mechanism has provided adequate safeguards against victimisation of
directors/employees of the Company who avail the mechanism and also
provide for direct access to the Chairman of the Audit Committee. No
personnel is denied access to this mechanism.
0.00
The Whistle Blower Policy has been posted on the website of the
Company at www.erosintl.com.
Physical Segment
Demat Segment
• NSDL
• CDSL
Total
103
7,56,90,757
1,92,81,017
9,49,71,877
79.70%
20.30%
100
The Company’s Equity Shares are regularly traded on the BSE Limited
and the National Stock Exchange of India Limited, in dematerialised form.
Under the Depository system, the International Security Identification
Number (ISIN) allotted to the Company’s shares is INE416L01017.
OUTSTANDING ADRS/GDRS AND OTHER INSTRUMENTS
During the year under review, the Company did not issue any ADRs/
GDRs/other instruments, which are convertible into equity shares of the
Company.
The Company has outstanding stock options in force which carries
entitlement of equity shares of the Company, as and when exercised.
PAYMENT OF UNPAID DIVIDEND(S) OF PREVIOUS YEAR(S)
The Company had declared interim dividend in the financial year
2012-13. Each year your Company sends reminders to those shareholders
who have not encashed their dividend. This year the Company has
sent reminder on 18 May 2018. Also, pursuant to the provisions of
Investor Education and Protection Fund Authority (Accounting, Audit,
Transfer and Refund) Rules, 2016, the Company has uploaded the
details of unpaid and unclaimed amounts lying with the Company as on
28 September 2017 (date of last Annual General Meeting) on the
Company’s website at www.erosintl.com and on the website of the
Ministry of Corporate Affairs.
The Company also sends request letter to all the shareholders, who have
opted for physical mode of communication, to register their email IDs for
receiving all communication from the Company through electronic mode
on annual basis.
Address for General Correspondence
Company Secretary &
Compliance Officer
Eros International Media Limited
Registered Office:
201, Kailash Plaza,
Opp Laxmi industrial Estate,
Off. Andheri Link Road,
Andheri West,
Mumbai – 400 053,
Maharashtra (India).
Corporate Office:
901/902, Supreme Chambers,
Off. Veera Desai Road, Andheri West,
Mumbai- 400 053,
Maharashtra (India).
Tel: + (91 22) 6602 1500
Fax: + (91 22) 6602 1540
Email: compliance.officer@erosintl.
com
Web: www.erosintl.com
OTHER DISCLOSURES:
Disclosure on Material Related Party Transactions
During the year, there were no transactions of materially significant nature
with the Promoters or Directors or the Management or the subsidiaries or
relatives etc. that had potential conflict with the interests of the Company
at large. A statement of summary of related party transactions is duly
disclosed in the Notes to Accounts.
SUBSIDIARIES
As on 31 March 2018, the Company has Ten (10) direct subsidiaries.
Out of Ten (10) direct subsidiaries, Eight (8) are Indian and other Two
(2) are foreign subsidiaries.
None of the subsidiary companies except Copsale Limited (a British
Virgin Island Company) are material non-listed subsidiary in terms of
Regulation 16(c) of the SEBI Listing Regulations. The Board of Directors
of the Companies have also formulated a policy for determining ‘material’
subsidiaries and the same has been uploaded on the website of the
Company at www.erosintl.com.
The Financial Statements, in particular the investments made by the
unlisted subsidiaries, statement containing all significant transactions
and arrangements entered into by the unlisted subsidiaries forming
part of the financials are being reviewed by the Audit Committee of
your Company on a quarterly basis. Also, statements of all significant
transactions and arrangements entered into by the unlisted subsidiary
companies are periodically brought to the attention of the Board by the
Management.
RELATED PARTY TRANSACTION
A policy on materiality of Related Parties and dealings with Related
Party Transactions has been formulated by the Board of Directors
and has also been uploaded on the website of the Company at
www.erosintl.com. The objective of the Policy is to ensure due and
timely identification, approval, disclosure reporting and transparency
of transactions between Company and any of its Related Parties
in compliance with the applicable laws and regulations, as may be
amended from time to time.
Insider Trading Regulations
The Company has instituted a comprehensive code of conduct for its
Directors, Key Managerial Personnel, Senior Management Personnel,
Designated Employees and third parties such as auditors, consultants,
etc. who are expected to have access to unpublished price sensitive
information relating to the Company in compliance with Securities and
Exchange Board of India (Prohibition of Insider Trading) Regulations,
2015, as amended from time to time.
The objective of the Code is to prevent purchase and/or sale of securities
of the Company by an insider on the basis of unpublished price sensitive
information. Under this Code, Directors, Key Managerial Personnel and
Senior Management Personnel, Designated Employees, their immediate
relatives and such others connected person, are completely prohibited
from dealing in the Company’s shares during the closure of Trading
Window. Further, the Code specifies the procedures to be followed and
disclosures to be made by Directors, Key Managerial Personnel, Senior
Management Personnel and such other Designated Employees, while
dealing with the securities of the Company and enlists the consequences
of any violations.
The Annual disclosures as required from Directors, Key Managerial
Personnel, Senior Management Personnel and other Designated
Employees for adherence to this Code during the financial year 2017-18
have been received by the Company and certificate to that effect from
EROS IntERnatIOnal MEdIa lIMItEd 79
Corporate overview | ManageMent report | finanCial management •
•
•
•
•
•
The Company has in place the mechanism to inform Board
members about the risk assessment and minimisation procedures
and periodical reviews to ensure that risk is controlled by the
Executive Management.
During the year, the Company did not make any public issue,
right issue, preferential issue, etc. and hence it did not receive any
proceeds from any such issues. The proceeds received from public
issue made in 2010, were appropriately utilized.
During the last three years, there were no instances of non-
compliance by the Company and no penalty or strictures were
imposed on the Company by the Stock Exchanges or SEBI or any
statutory authority, on any matter related to the capital markets.
The Company is fully compliant with the applicable mandatory
requirements under SEBI Listing Regulations, relating to Corporate
Governance.
The Company has laid down the Whistle Blower mechanism for
employees and its stakeholders of the Company to report to the
management about any instances of unethical behaviour, actual or
suspected fraud, illegal or unethical practices in the Company.
During the year under review, there was no audit qualification in
the Company’s Financial Statements. Your Company continues to
adopt best practices to ensure a regime of unqualified Financial
Statements.
Code of Conduct
The Board has laid down a Code of Business Conduct and Ethics for
all the Directors, Key Managerial Personnel and Senior Managerial
Personnel of the Company in accordance with the requirement under
Regulation 17(5) of SEBI Listing Regulations. The Code has also been
posted on the website of the Company at www.erosintl.com. All the
Board Members, Key Managerial Personnel and Senior Management
Personnel have affirmed their compliance with the said Code for the
Financial Year ending 31 March 2018.
A declaration to this effect signed by the Executive Vice Chairman and
Managing Director of the Company is provided below in this Report.
In accordance with Schedule IV of the Act, a separate Code of Conduct
for the Independent Directors has been adopted by the Company. The
said Code states, inter alia, the duties, roles and responsibilities of
Independent Directors and it has also been posted on the website of the
Company at www.erosintl.com.
All Independent Directors have confirmed to the Company that they have
adhered to and complied with the said Code for the Financial Year end
31 March 2018.
DECLARATION AFFIRMING COMPLIANCE OF CODE OF CONDUCT
To the best of my knowledge and belief, I hereby affirm that all the Board
Members and Senior Management Personnel of the Company have fully
complied with the provisions of the code of conduct as laid down by the
Company for Directors and Senior Management Personnel during the
financial year ended on 31 March 2018.
For and on behalf of the Board
Eros International Media Limited
Sd/-
Sunil Arjan Lulla
Executive Vice Chairman and Managing Director
DIN: 00243191
Date: 23 May 2018
Place: Mumbai
the Executive Vice Chairman & Managing Director is annexed hereto
and forms part of this Report.
The Company Secretary has been appointed as the Compliance Officer
for monitoring adherence to the Code.
The Code is uploaded on the Company’s website at www.erosintl.com.
Secretarial Audit
M/s. Makarand M. Joshi & Co., firm of Company Secretaries, carried
out various compliance and secretarial audits during the year:
•
•
Quarterly Secretarial Audit
Annual Secretarial Audit as required under Section 204 of the Act
and applicable Rules thereto
Report issued by M/s. Makarand M. Joshi & Co. is attached and forms
part of Directors Report.
CEO/CFO CERTIFICATION
The Executive Vice Chairman and Managing Director and the Chief
Financial Officer of the Company give annual certification on financial
reporting and internal controls to the Board in terms of Regulation 17(8) of
the SEBI Listing Regulations. The Executive Vice Chairman and Managing
Director and the Chief Financial Officer also give quarterly certification on
financial results while placing the financial results before the Board in
terms of Regulation 33(2) of the SEBI Listing Regulations. The annual
certificate given by the Executive Vice Chairman and Managing Director
and the Chief Financial Officer is published in this Report.
The Company has complied with all the mandatory requirements of
Corporate Governance Report as stated under SEBI Listing Regulations.
COMPLIANCE OF DISCRETIONARY REQUIREMENTS
The Company has adopted the following discretionary requirements
stated under Part E of Schedule II of Regulation 27(1) of SEBI Listing
Regulations:-
A.
The Board
The Chairman i.e. Mr. Dhirendra Swarup is a Non-Executive
Independent Director and the Company maintains the Chairman’s
office at its expense and reimburses all expenses incurred in
performance of duties by the Chairman.
B. Separate posts of chairperson and chief executive officer
The Company has appointed two separate persons for the
post of Chairperson of the Company and Managing Director.
Mr. Dhirendra Swarup act as the Chairperson of the Board whereas
Mr. Sunil Arjan Lulla is the Executive Vice Chairman & Managing
Director of the Company.
C. Reporting of Internal Auditor
The Company has appointed M/s KPMG, Chartered Accountant
as the Internal Auditor of the Company to review the adequacy
and effectiveness of internal control and governance process in
the Company through periodic audits. The Internal Audit Report
contains their finding and suggestions for improvement which are
periodically tabled before the Audit Committee for their review.
COMPLIANCE WITH CORPORATE GOVERNANCE MANDATORY
REQUIREMENTS
The Company has complied with the all the required requirements
specified under Regulation 17 to Regulation 27 and Clauses (b) to (i) of
sub-regulation (2) of Regulation 46 of SEBI Listing Regulations and the
disclosure of the compliance status forms part of this Report.
OTHER DISCLOSURES
•
No treatment different from the Indian Accounting Standards (Ind
AS), prescribed by the Institute of Chartered Accountants of India,
has been followed in the preparation of financial statements.
80 annual REpORt 2017-18
CORPORATE GOVERNANCE REPORT
CEO/CFO CERTIFICATE
To,
The Board of Directors
Eros International Media Limited
Mumbai
We hereby certify that in the preparation of the accounts for the year ended 31 March 2018:
(a) We have reviewed Financial Statements and the Cash Flow Statement for the year and that to the best of our knowledge and belief:
(i)
(ii)
these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;
these statements together present a true and fair view of the company’s affairs and are in compliance with existing Indian Accounting
Standards (Ind AS), applicable laws and regulations.
(b)
To the best of our knowledge and belief, there are no transactions entered into by the Company during the year, which are fraudulent, illegal or
in violation of the Company’s code of conduct.
(c) We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness
of the internal control systems of the Company pertaining to financial reporting and we have disclosed to the auditors and the Audit
Committee, and further state that there were no deficiencies in the design or operation of such internal controls.
(d) We have indicated to the Auditors and the Audit Committee:
(i)
(ii)
(iii)
That there are no significant changes in internal controls over financial reporting during the year.
That there are no Significant changes in accounting policies during the year.
There have been no instances of significant fraud of which we have become aware and the involvement therein, if any of the management
or an employee having a significant role in the company’s internal control system over financial reporting.
Sd/-
Sunil Arjan Lulla
Executive Vice Chairman & Managing Director
Date: 23 May 2018
Place: Mumbai
Sd/-
Farokh P. Gandhi
Chief Financial Officer
EROS IntERnatIOnal MEdIa lIMItEd 81
Corporate overview | ManageMent report | finanCial management
CERTIFICATE OF COMPLIANCE WITH THE CONDITIONS OF CORPORATE GOVERNANCE UNDER SCHEDULE V OF THE SEBI (LISTING
OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015
To,
The Members of
Eros International Media Limited
201, Kailash Plaza, Opp. Laxmi Industrial Estate,
Off Andheri Link Road, Andheri West,
Mumbai – 400053.
Maharashtra (India).
1. We have examined the compliance on Corporate Governance by Eros International Media Limited during the year ended
31 March 2018, with the relevant records and documents maintained by the Company, furnished to us for our review and report on Corporate
Governance, as approved by the Board of Directors.
2. The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to a review of the
procedures and implementation thereof, adopted by the Company for ensuring compliance of the conditions of Corporate Governance. It is
neither an audit nor an expression of opinion on the Financial Statements of the Company.
3. We further state that such compliance is neither an assurance as to the future viability of the company nor the efficiency or effectiveness with which
the management has conducted the affairs of the Company.
4. On the basis of our review and according to the best of our information and according to the explanation given to us, the Company has been
complying with the conditions of Corporate Governance as stipulated in SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Date: 23 May 2018
Place: Mumbai
EQUITY SHARES IN THE SUSPENSE ACCOUNT
For Makarand M. Joshi & Co.,
Company Secretaries
Sd/-
Makarand Joshi
Partner
Membership No.: FCS No.: 5533
Certificate of Practice No: 3662
In terms of Schedule V(F) of SEBI Listing Regulations, the Company reports the following details in respect of equity shares lying in the suspense
accounts which were issued in demat form:
Sr. No. Particulars
1
2
3
4
Aggregate number of shareholders and the outstanding shares in the suspense account lying
at the beginning of the year (1 April 2017);
Number of shareholders who approached issuer for transfer of shares from suspense account
during the year;
Number of shareholders to whom shares were transferred from suspense account during the
year;
No. of Shareholders
No. of Shares
4 Shareholders
169 Equity Shares
Nil
Nil
Aggregate number of shareholders and the outstanding shares in the suspense account lying
at the end of the year (31 March 2018).
4 Shareholders
169 Equity Shares
The voting rights on the shares in the suspense accounts as on 31 March 2018 shall remain frozen till the rightful owners of such shares claim the
shares.
82 annual REpORt 2017-18
CORPORATE GOVERNANCE REPORT
INDEPENDENT AUDITOR’S REPORT
INDEPENDENT AUDITOR’S REPORT
To the Members of
Eros International Media Limited
Report on the Standalone financial statements
We have audited the accompanying standalone financial statements of
Eros International Media Limited (“the Company”), which comprises
the Balance Sheet as at 31 March 2018, the Statement of Profit and
Loss, including the Statement of Other Comprehensive Income, the
Cash Flow Statement and the Statement of Changes in Equity for the
year then ended, and a summary of significant accounting policies and
other explanatory information.
Management’s Responsibility
statements
for the Standalone financial
The Company’s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect
to the preparation of these standalone financial statements that give
a true and fair view of the state of affairs (financial position), profit or
loss (financial performance including Other Comprehensive Income),
cash flows and changes in equity of the Company in accordance with
accounting principles generally accepted in India, including the Indian
Accounting Standards (“Ind AS”) specified under Section 133 of the Act.
This responsibility also includes maintenance of adequate accounting
records in accordance with the provisions of the Act for safeguarding of
the assets of the Company and for preventing and detecting frauds and
other irregularities; selection and application of appropriate accounting
policies; making judgments and estimates that are reasonable and
prudent; and the design, implementation and maintenance of adequate
internal financial control that were operating effectively for ensuring the
accuracy and completeness of the accounting records, relevant to the
preparation and presentation of the standalone financial statements that
give a true and fair view and are free from material misstatement, whether
due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these standalone financial
statements based on our audit.
We have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included
in the audit report under the provisions of the Act and the Rules made
thereunder. We conducted our audit in accordance with the Standards
on Auditing, issued by the Institute of Chartered Accountants of India,
specified under Section 143(10) of the Act. Those Standards require that
we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the standalone financial
statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor’s judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal financial control relevant to the Company’s preparation
of the financial statements that give a true and fair view in order to design
audit procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of accounting policies used and
the reasonableness of the accounting estimates made by the Company’s
Directors, as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on these standalone
financial statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone financial statements
give the information required by the Act in the manner so required and
give a true and fair view in conformity with the accounting principles
generally accepted in India including Ind AS specified under Section 133
of the Act, of the state of affairs of the Company as at 31 March 2018 of
its profit including Other Comprehensive Income, its cash flows and the
changes in equity for the year ended on that date
Other Matters
The comparative financial information of the Company for the year
ended 31 March 2017 prepared in accordance with Indian Accounting
Standards, included in these Standalone Financial Statements, have
been audited by the predecessor auditor. The report of the predecessor
auditor on the comparative financial information expressed an unmodified
opinion.
Report on Other Legal and Regulatory Requirements
1.
As required by the Companies (Auditor’s report) Order, 2016 (“the
Order”) issued by the Central Government of India in terms of sub-
Section (11) of Section 143 of the Act, we give in the “Annexure-A”
a statement on the matters specified in paragraphs 3 and 4 of the
Order.
2.
As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and
explanations which to the best of our knowledge and belief
were necessary for the purpose of our audit;
(b)
(c)
In our opinion proper books of account as required by law
have been kept by the Company so far as appears from our
examination of those books;
The Balance Sheet, the Statement of Profit and Loss
including the Statement of Other Comprehensive Income,
the Cash Flow Statement and the Statement of Changes in
Equity dealt with by this Report are in agreement with the
books of account;
(d)
In our opinion, the aforesaid standalone financial statements
comply with the Ind AS specified under Section 133 of the
Act;
(e) On the basis of written representations received from the
directors as on 31 March 2018, and taken on record by the
Board of Directors, none of the directors is disqualified as on
31 March 2018, from being appointed as a director in terms
of Section 164 (2) of the Companies Act, 2013;
(f) With respect to the adequacy of the internal financial controls
over financial reporting of the Company and the operating
effectiveness of such controls, refer to our separate Report in
“Annexure B” to this report;
(g) With respect to the other matters to be included in the Auditor’s
Report in accordance with Rule 11 of the Companies (Audit
and Auditors) Rules, 2014, in our opinion and to the best of
our information and according to the explanations given to
us:
i.
The Company has disclosed the impact of pending litigations
on its financial position in its Ind AS standalone financial
statements – Refer Note 40 to the financial statements;
EROS IntERnatIOnal MEdIa lIMItEd 83
Corporate overview | ManageMent report | financial management ii.
iii.
The Company did not have any long-term contracts including
derivative contracts for which there were any material
foreseeable losses; and
There has been no delay in transferring amounts, required
to be transferred, to the Investor Education and Protection
Fund by the Company.
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No. 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No. 103141
Mumbai
Dated : 23 May 2018
84 annual REpORt 2017-18
Standalone StatementS Annexure “A”
referred to in paragraph 1 under the heading Report on other
legal and regulatory requirements of our report of even date
i.
In respect of its Fixed Assets :
a.
b.
The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets on the basis of available information.
As explained to us, all the fixed assets have been physically
verified by the management during the year by engaging the
outside expert which in our opinion is reasonable, having
regard to the size of the Company and nature of its assets.
No material discrepancies were noticed on such physical
verification.
c.
According to the information and explanations given to us,
the title deeds of all the immovable properties are held in the
name of the Company.
iv.
v.
vi.
ii.
In respect of its Inventories:
According to the information and explanation given to us physical
verification of inventories comprising of VCD/DVD/Audio CD have
been conducted at reasonable intervals by the management,
which in our opinion is reasonable, having regard to the size of the
Company and nature of its inventories. No material discrepancies
noticed on such verification of inventories as compared to the book
records.
iii.
In respect of loans, secured or unsecured, granted by the Company
to companies, firms, limited liability partnerships or other parties
covered in the register maintained under Section 189 of the Act:
a)
b)
In our opinion the terms and conditions of the grant of such
loans are prima facie, not prejudicial to the Company’s
interest.
The schedule of repayment of principal and interest has been
stipulated wherein the principal and interest amounts are
repayable on demand. Since the repayment of such loans
has not been demanded, in our opinion, the repayment of the
principal and interest amount is regular.
c)
There is no overdue amount in respect of loans granted to
such companies and firms.
In respect of loans, investments, guarantees and security, the
Company has complied with the provisions of Section 185 and
186 of the Act.
According to the information and explanations given to us, the
Company has not accepted any deposits within the meaning of
provisions of Sections 73 to 76 or any other relevant provisions of
the Act and the rules framed thereunder. Therefore, the provisions
of Clause (v) of paragraph 3 of the Order are not applicable to the
Company.
To the best of our knowledge and as explained, The Central
Government has not specified maintenance of cost records under
sub Section (1) of Section 148 of the Act, in respect of Company’s
products/services. Accordingly, the provision of clause 3(vi) of the
order is not applicable.
vii.
In respect of Statutory dues :
a.
According to the records of the Company, Undisputed
statutory dues including provident fund, employees’ state
insurance, income-tax, sales-tax, service tax, goods and
service tax, duty of customs, value added tax, cess and
other material statutory dues, as applicable, have not been
regularly deposited to the appropriate authorities and there
have been significant delays in a large number of cases.
Undisputed amounts payable in respect thereof, which
were outstanding at the year-end for a period of more than
six months from the date they became payable are as
follows:-
Statement of arrears of statutory dues outstanding for more than six months:-
Name of the statute
Nature of the dues
Income Tax Act, 1961
Income Tax Act, 1961
Income Tax Act, 1961
Maharashtra Value Added Tax,
2002
Maharashtra Value Added Tax,
2002
Interest on Income Tax
Self Assessment Tax
Advance Income Tax
Work Contract Tax
Amount
` in Lakhs
450.33
3,364.44
1,322.12
2.08
Period to which the
amount relates
Assessment Year 2016-17
Assessment Year 2017-18
Assessment Year 2018-19
Assessment Year 2018-19
Due Date
31-03-2016
31-03-2017
15-09-2017
20-07-2017
Date of
Payment
Unpaid
Unpaid
Unpaid
Unpaid
Sales Tax
120.91
Financial year 2016-17
20-01-2017
Maharashtra Value Added Tax,
2002
Sales Tax
74.69
Financial Year 2016-17
20-04-2017
Paid
amounting
to ` 76.30
Lakhs till date
Paid
amounting
to ` 39.70
Lakhs till date
Unpaid
Maharashtra Value Added Tax,
2002
Central Sales Tax Act, 1944
Central Sales Tax Act, 1944
Central Sales Tax Act, 1944
Sales Tax
27.97
Financial Year 2017-18
20-07-2017
Central Sales Tax
Central Sales Tax
Central Sales Tax
3.89
4.54
5.62
Financial year 2016-17
Financial year 2016-17
Financial Year 2017-18
20-01-2017
20-04-2017
20-07-2017
Unpaid
Unpaid
Unpaid
b. On the basis of our examination of accounts and documents on records of the Company and information and explanations given to us upon
enquires in this regard, the disputed amounts payable in respect of Income Tax, Sales Tax, Service Tax, Custom Duty and Excise Duty/Cess not
deposited with the appropriate authorities are as under:
EROS IntERnatIOnal MEdIa lIMItEd 85
Corporate overview | ManageMent report | financial management
Statement of Disputed Dues:-
Name of the statute
Nature of the
dues
Amount
` in Lakhs
Finance Act, 1994
Income Tax Act, 1961
Service Tax,
Penalties and
Interest
Income Tax
Income Tax Act, 1961
Income Tax
Maharashtra Value
Added Tax, 2002
Central Sales Tax Act,
1956
Sales Tax
Sales Tax
31,810.63
41.84
37.64
2,002.69
170.34
viii.
ix.
x.
xi.
xii.
In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of loans
or borrowings to any bank or financial institution or government
during the year. The Company did not have any outstanding
debentures during the year.
The Company has not raised money by way of initial public offer or
further public offer (including debt instruments). In our opinion, the
term loans were applied for the purpose for which the loans were
obtained.
Based on the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and
as per information and explanations given to us, no fraud by the
Company or on the Company by its officers or employees has
been noticed or reported during the year.
In our opinion and according to the information and explanations
given to us, managerial remuneration has been paid or provided
in accordance with the requisite approvals mandated by the
provisions of Section 197 read with Schedule V to the Act.
In our opinion Company is not a Nidhi Company. Therefore,
the provisions of clause (xii) of paragraph 3 of the Order are not
applicable to the Company.
xiii.
In respect of transactions with related parties:
In our opinion and according to the information and explanations
given to us, all transactions with related parties are in compliance
Amount Paid
under protest
(Amount
` in Lakhs)
1,000.00
Period to which the
amount relates
Forum where dispute
is pending
Various Years From
2009-10 to 2016-2017
Assistant commissioner
of sales tax (Appeals)
-
-
26.10
2.00
Various Assessment
Years From 2003-04 to
2014-15
Assessment Year
2004-05
Various Years From
2005-06 to 2013-14
Various Years From
2005-06 to 2013-14
Commissioner of
Income Tax (Appeal)
High Court
Joint Commissioner of
sales tax (Appeals)
Joint Commissioner of
sales tax (Appeals)
with Sections 177 and 188 of the Act and their details have been
disclosed in the financial statements etc., as required by the
applicable Ind AS.
xiv. During the year the Company has not made any preferential
allotment or private placement of shares or fully or partly convertible
debentures.
xv.
In our opinion and according to the information and explanations
given to us, the Company has not entered into any non-cash
transaction with the directors or persons connected with him and
covered under Section 192 of the Act. Hence, clause (xv) of the
paragraph 3 of the Order is not applicable to the Company.
xvi. To the best of our knowledge and as explained, the Company is
not required to be registered under Section 45-IA of the Reserve
Bank of India Act, 1934.
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No. 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No. 103141
Mumbai
Dated : 23 May 2018
86 annual REpORt 2017-18
Standalone StatementS
Annexure “B”
to the Independent Auditor's Report
Report on the Internal Financial Controls under Clause (i) of Sub-
Section 3 of Section 143 of the Companies Act, 2013 (“the Act”)
We have audited the Internal Financial Control over financial reporting of
Eros International Media Limited (“the Company”) as of 31 March 2018
in conjunction with our audit of the standalone financial statements of the
Company for the year then ended.
Management Responsibility for the Internal Financial Controls
The Company’s management is responsible for establishing and
maintaining internal financial controls based on the internal control over
financial reporting criteria established by the Company considering the
essential components of internal control stated in the Guidance Note on
Audit of Internal Financial Controls over Financial Reporting issued by the
Institute of Chartered Accountants of India (ICAI). These responsibilities
include the design, implementation and maintenance of adequate internal
financial controls that were operating effectively for ensuring the orderly
and efficient conduct of its business, including adherence to Company’s
policies, the safeguarding of its assets, the prevention and detection of
frauds and errors, the accuracy and completeness of the accounting
records, and the timely preparation of reliable financial information, as
required under the Act.
Auditor’s Responsibility
Our responsibility is to express an opinion on the Company's internal
financial controls over financial reporting based on our audit. We
conducted our audit in accordance with the Guidance Note on Audit
of Internal Financial Controls over Financial Reporting (the “Guidance
Note”) and the Standards on Auditing, issued by ICAI and deemed to
be prescribed under Section 143(10) of the Act, to the extent applicable
to an audit of internal financial controls, both applicable to an audit of
Internal Financial Controls and, both issued by the ICAI. Those Standards
and the Guidance Note require that we comply with ethical requirements
and plan and perform the audit to obtain reasonable assurance about
whether adequate internal financial controls over financial reporting was
established and maintained and if such controls operated effectively in
all material respects.
Our audit involves performing procedures to obtain audit evidence about
the adequacy of the internal financial controls system over financial
reporting and their operating effectiveness. Our audit of internal financial
controls over financial reporting included obtaining an understanding of
internal financial controls over financial reporting, assessing the risk that
a material weakness exists, and testing and evaluating the design and
operating effectiveness of internal control based on the assessed risk.
The procedures selected depend on the auditor’s judgment, including
the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on the Company’s
internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A Company's internal financial control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles.
A Company's internal financial control over financial reporting includes
those policies and procedures that (1) pertain to the maintenance
of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the Company; (2) provide
reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of
the Company are being made only in accordance with authorisations of
management and directors of the Company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorised
acquisition, use, or disposition of the Company's assets that could have
a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial
Reporting
Because of the inherent limitations of internal financial controls over
financial reporting, including the possibility of collusion or improper
management override of controls, material misstatements due to error or
fraud may occur and not be detected. Also, projections of any evaluation
of the internal financial controls over financial reporting to future periods
are subject to the risk that the internal financial control over financial
reporting may become inadequate because of changes in conditions,
or that the degree of compliance with the policies or procedures may
deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate
internal financial controls system over financial reporting and such internal
financial controls over financial reporting were operating effectively
as at 31 March 2018, based on the internal control over financial
reporting criteria established by the Company considering the essential
components of internal control stated in the Guidance Note on Audit of
Internal Financial Controls Over Financial Reporting issued by the ICAI.
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No. 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No. 103141
Mumbai
Dated : 23 May 2018
EROS IntERnatIOnal MEdIa lIMItEd 87
Corporate overview | ManageMent report | financial management Balance Sheet
as at 31 March 2018
Particulars
Assets
Non-current assets
Property, plant and equipment
Intangible assets
a) Content advances
b) Film rights
c) Other intangible assets
d) Intangible assets under development
Financial assets
a) Investments
b) Loans and advances
c) Restricted bank deposits
d) Other financial assets
Other non-current assets
Total non-current assets
Current assets
Inventories
Financial assets
a) Trade receivables
b) Cash and cash equivalents
c) Restricted bank deposits
d) Loans and advances
e) Other financial assets
Other current assets
Total current assets
Total assets
Equity and Liabilities
Equity
Equity share capital
Other equity
Total equity
Liabilities
Non-current liabilities
Financial liabilities
a) Borrowings
b) Trade payables
c) Other financial liabilities
Employee benefit obligations
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities
Current liabilities
Financial liabilities
a) Borrowings
b) Acceptances
c) Trade payables
d) Other financial liabilities
Employee benefit obligations
Current tax liabilities
Other current liabilities
Total current liabilities
Total liabilities
Total equity and liabilities
Notes
As at
31 March 2018
As at
31 March 2017
Amount ` in lakhs
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
3,746
137,408
77,315
26
1,397
5,503
1,721
716
672
2,951
231,455
187
44,024
385
3,776
3,205
294
55
51,926
283,381
9,497
134,702
144,199
14,941
102
-
425
25,221
1,512
42,201
48,621
5,796
17,023
8,521
212
3,506
13,302
96,981
139,182
283,381
3,966
119,967
88,743
34
53
6,803
2,512
217
722
4,740
227,757
46
26,505
131
4,255
1,479
184
106
32,706
260,463
9,385
125,656
135,041
14,912
101
1
351
22,358
3,016
40,739
41,534
5,795
10,731
9,001
198
4,265
13,159
84,683
125,422
260,463
Notes 1 to 50 form an integral part of these standalone financial statements.
As per our report of even date
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No.: 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No: 103141
Place: Mumbai
Date : 23 May 2018
88 annual REpORt 2017-18
For and on behalf of Board of Directors
Sd/-
Sunil Arjan Lulla
Executive Vice Chairman and Managing Director
(DIN: 00243191)
Sd/-
Sunil Srivastav
Non Executive Independent Director
(DIN: 00237561)
Sd/-
Farokh P. Gandhi
Chief Financial Officer
Place: Mumbai
Date : 23 May 2018
Sd/-
Abhishekh Kanoi
Vice President - Company Secretary
and Compliance Officer
Standalone StatementS Statement of Profit and Loss
for the year ended 31 March 2018
Particulars
Revenue
Revenue from operations (net)
Other income
Total revenue
Expenses
Film right costs including amortization costs
Changes in inventories of film rights
Employee benefits expense
Finance cost (net)
Depreciation and amortization expense
Other expenses
Total expenses
Profit before tax
Tax expense
Current tax
Deferred tax
Short/(excess) provision of earlier years
Profit after tax for the year
Other comprehensive income
(i) Items that will not be reclassified to profit or loss
Remeasurement gain on defined benefit plan
Income tax effect (net)
Total comprehensive income for the year
Earnings per share
Basic (in `) (nominal value `10)
Diluted (in `) (nominal value `10)
Amount ` in lakhs
Notes
Year ended
31 March 2018
Year ended
31 March 2017
31
32
33
34
35
36
37
38
39
70,766
2,091
72,857
33,201
(142)
4,625
7,488
615
13,027
58,814
14,043
9,393
(3,233)
182
6,342
7,701
86
(30)
7,757
8.15
8.03
114,618
1,848
116,466
68,033
262
5,413
5,201
532
15,925
95,366
21,100
7,415
447
199
8,061
13,039
(22)
-
13,017
13.92
13.68
Notes 1 to 50 form an integral part of these standalone financial statements
As per our report of even date
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No.: 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No: 103141
Place: Mumbai
Date : 23 May 2018
For and on behalf of Board of Directors
Sd/-
Sunil Arjan Lulla
Executive Vice Chairman and Managing Director
(DIN: 00243191)
Sd/-
Sunil Srivastav
Non Executive Independent Director
(DIN: 00237561)
Sd/-
Farokh P. Gandhi
Chief Financial Officer
Place: Mumbai
Date : 23 May 2018
Sd/-
Abhishekh Kanoi
Vice President - Company Secretary
and Compliance Officer
EROS IntERnatIOnal MEdIa lIMItEd 89
Corporate overview | ManageMent report | financial management Statement of Changes in Equity
As at 31 March 2018
A. Equity share capital
Balance as at 1 April 2016
Add: Issued on exercise of employee share options
Balance as at 31 March 2017
Add: Issued on exercise of employee share options
Balance as at 31 March 2018
B. Other equity
Particulars
Balance as at 1 April 2016
Profit for the year
Acturial gain / (loss) on employee benefit plans
through OCI
Transfer from/to share option outstanding account
Employee stock option compensation expense
Employee stock option compensation expense to
employee’s of subsidiary
Balance as at 31 March 2017
Profit for the year
Acturial gain / (loss) on employee benefit plans
through OCI
Additions for employee stock options exercised
during the year
Transfer from/to share option outstanding account
Employee stock option compensation expense
Employee stock option compensation expense to
employee’s of subsidiary
Balance as at 31 March 2018
Number
93,589,164
269,553
93,858,717
1,113,160
94,971,877
Amounts ` in lakhs
9,358
27
9,385
112
9,497
Share
Premium
Account
37,513
-
-
628
-
-
General
Reserves
Share Options
Outstanding
Retained
Earnings
526
-
-
-
-
-
1,775
-
-
(628)
1,464
34
71,315
13,039
-
-
-
-
Amount ` in Lakhs
Other
comprehensive
income / (loss)
12
-
(22)
-
-
-
Total other
equity
111,141
13,039
(22)
-
1,464
34
38,141
526
2,645
84,354
(10)
125,656
-
-
247
2,110
-
-
-
-
-
-
-
-
-
(2,110)
862
180
7,701
-
-
-
-
-
-
56
-
-
-
-
7,701
56
247
-
862
180
40,498
526
1,577
92,055
46
134,702
As per our report of even date
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No.: 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No: 103141
Place: Mumbai
Date : 23 May 2018
For and on behalf of Board of Directors
Sd/-
Sunil Arjan Lulla
Executive Vice Chairman and Managing Director
(DIN: 00243191)
Sd/-
Sunil Srivastav
Non Executive Independent Director
(DIN: 00237561)
Sd/-
Farokh P. Gandhi
Chief Financial Officer
Place: Mumbai
Date : 23 May 2018
Sd/-
Abhishekh Kanoi
Vice President - Company Secretary
and Compliance Officer
90 annual REpORt 2017-18
Standalone StatementS Cash Flow Statement
For the year ended 31 March 2018
Particulars
Cash flow from operating activities
Profit before tax
Non-cash adjustments to reconcile Profit before tax to net cash flows
Depreciation and amortization
Trade receivables written off
Sundry balances written back
Content advances written off
Provision for doubtful advances
Advances and deposits written off
Provision for doubtful trade receivables
Unwinding of interest on expected credit loss
Finance costs
Interest income
Loss/(gain) on sale of tangible assets (net)
Impairment loss on investment in subsidiary
Expense on employee stock option scheme
Unrealised foreign exchange gain
Operating profit before working capital changes
Movements in working capital:
Increase/(decrease) in current liabilities
Increase/(decrease) in other financial liabilities
Increase/(decrease) in trade payables
Increase/(decrease) in employee benefit obligations
(Increase)/decrease in inventories
(Increase)/decrease in trade receivables
(Increase)/decrease in other current assets
(Increase) /decrease in other non- current assets
(Increase)/decrease in short-term loans and advances
(Increase)/decrease in other financial assets
Cash generated from operations
Taxes paid (net)
Net cash generated from operating activities (A)
Cash flow from investing activities
Purchase of tangible assets
Purchase of intangible film rights and related content
Deposits with banks (net)
Advance given
Proceeds from sale of fixed assets
Interest income
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
14,043
21,100
22,979
3,539
(79)
228
-
0
-
(409)
7,752
(264)
1
1,480
834
(309)
49,795
(1,361)
(485)
2,257
88
29
(20,444)
51
1,640
(934)
51
30,687
(4,807)
25,880
(443)
(25,891)
(21)
-
4
154
36,686
206
(316)
450
283
287
543
-
5,409
(311)
(1)
552
1,398
229
66,515
(26,301)
192
281
164
18
(13,185)
195
(1,132)
511
59
27,317
(4,250)
23,067
(383)
(45,216)
(2,692)
1,014
1
258
Net cash used in investing activities (B)
(26,197)
(47,018)
EROS IntERnatIOnal MEdIa lIMItEd 91
Corporate overview | ManageMent report | financial management Cash Flow Statement
For the year ended 31 March 2018
Particulars
Cash flows from financing activities
Proceeds from issue of equity shares (net)
Repayment of long-term borrowings
Proceeds from long-term borrowings
Change in short-term borrowings
Finance charges (net)
Net cash flow from/(used ) in financing activities (C)
Net increase/(decrease) in cash and cash equivalents (A + B + C)
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year (refer note 12)
Change in liability arising from financing activities :-
As on 1 April 2017
Cash Flows
Adjustments
As on 31 March 2018
Non current
borrowings
Current
borrowing
22,060
112
(37)
22,135
41,534
7,251
(164)
48,621
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
358
(7,159)
7,272
7,252
(7,152)
571
254
131
385
27
(7,976)
11,074
23,832
(4,594)
22,363
(1,588)
1,719
131
Amount ` in lakhs
Acceptances
Total
5,795
1
-
5,796
69,389
7,364
(201)
76,552
Notes 1 to 50 form an integral part of these standalone financial statements
As per our report of even date
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No.: 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No: 103141
Place: Mumbai
Date : 23 May 2018
For and on behalf of Board of Directors
Sd/-
Sunil Arjan Lulla
Executive Vice Chairman and Managing Director
(DIN: 00243191)
Sd/-
Sunil Srivastav
Non Executive Independent Director
(DIN: 00237561)
Sd/-
Farokh P. Gandhi
Chief Financial Officer
Place: Mumbai
Date : 23 May 2018
Sd/-
Abhishekh Kanoi
Vice President - Company Secretary
and Compliance Officer
92 annual REpORt 2017-18
Standalone StatementS Summary of Significant Accounting Policies
Corporate Information
Other income
Eros International Media Limited (the ‘Company’) was incorporated in
India, under the Companies Act, 1956. The Company is a global player
within the Indian media and entertainment industry and is primarily
engaged in the business of film production, exploitation and distribution.
It operates on a vertically integrated studio model controlling content
as well as distribution and exploitation across multiple formats globally,
including cinema, digital, home entertainment and television syndication.
Its shares are listed on leading stock exchanges in India (BSE Scrip
Code: 533261; NSE Scrip Code: EROSMEDIA).
These separate financial statements were authorised for issue in
accordance with a resolution passed in the Board of Directors meeting
held on 23 May 2018.
Basis of preparation
The separate financial statements are prepared in accordance with
Indian Accounting Standards (‘Ind AS’) notified under Section 133 of the
Companies Act, 2013 (‘the Act’) read with Companies (Indian Accounting
Standards) Rules, 2015 and relevant provisions of the Act (as amended
from time to time).
The financial statements have been prepared on accrual basis of
accounting using historical cost basis, except certain investment and
Employee Stock Option Plan (‘ESOP’) Compensation measured at
fair value.
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 Act. The Company considers 12 months to be its
normal operating cycle.
All values are rounded to the nearest rupees in Lakhs, except where
otherwise indicated. Amount in zero (0) represents amount below rupees
fifty thousand.
1.
Significant Accounting Policies
a. Revenue Recognition
Revenue
is recognized, net of sales related taxes, when
persuasive evidence of an arrangement exists, the fees are fixed
or determinable, the product is delivered or services have been
rendered and collectability is reasonably assured. The Company
considers the terms of each arrangement to determine the
appropriate accounting treatment.
The following additional criteria apply in respect of various revenue
streams within filmed entertainment:
Theatrical — Contracted minimum guarantees are recognized
on the theatrical release date. The Company’s share of box
office receipts in excess of the minimum guarantee is recognized
at the point they are notified to the Company.
Television — License fees received in advance which do not meet
all the above criteria are included in deferred income until the above
criteria is met.
Other — DVD, CD and video distribution revenue is recognized on
the date the product is delivered or if licensed in line with the above
criteria. Provision is made for physical returns where applicable.
Digital and ancillary media revenues are recognized at the earlier
of when the content is accessed or declared. Visual effects,
production and other fees for services rendered by the Company
and overhead recharges are recognized in the period in which they
are earned and in certain cases, the stage of production is used to
determine the proportion recognized in the period.
Dividend income is recognized when the Company’s right to receive the
payment is established, which is generally when shareholders approve
the dividend.
Interest income is recognized on a time proportion basis taking into
account the amount outstanding and the effective interest rate applicable.
b. Property, plant and equipment and depreciation
Property, Plant and Equipment is stated at cost, net of accumulated
depreciation and accumulated impairment losses, if any.
The cost of Property, Plant and Equipment comprises of its
purchase price or construction cost, any costs directly attributable
to bringing the asset into the location and condition necessary
for it to be capable of operating in the manner intended by
management, the
initial estimate of any decommissioning
obligation, if any, and borrowing costs for assets that necessarily
take a substantial period of time to get ready for their intended
use. Subsequent costs are included in the assets carrying amount
or recognized as a separate asset, as appropriate, only when it
is probable that future economic benefits associated with the
item will flow to the Company and the cost of the item can be
measured reliably.
Capital Work-in-progress (CWIP) includes expenditure that is
directly attributable to the acquisition/construction of assets, which
are yet to be commissioned.
Depreciation is provided under written down value method at the rates
and in the manner prescribed under Schedule II to the Companies Act,
2013.The residual values, useful lives and methods of depreciation of
property, plant and equipment are reviewed at each financial year end
and adjusted prospectively, if appropriate. Gains or losses arising from
de-recognition of a property, plant and equipment are measured as
the difference between the net disposal proceeds and the carrying
amount of the asset and are recognized in the Statement of Profit and
Loss when the asset is de-recognized.
c.
Intangible assets
Intangible assets acquired by the Company are stated at cost
less accumulated amortization less impairment loss, if any, (film
production cost and content advances are transferred to film and
content rights at the point at which content is first exploited).
Investments in films and associated rights, including acquired
rights and distribution advances in respect of completed films,
are stated at cost less amortization less provision for impairment.
Costs include production costs, overhead and capitalized interest
costs net of any amounts received from third party investors. A
charge is made to write down the cost of completed rights over
the estimated useful lives, writing off more in year one which
recognizes initial income flows and then the balance over a period
of up to nine years, except where the asset is not yet available
for exploitation. The average life of the assets is the lesser of 10
years or the remaining life of the content rights. The amortization
charge is recognized in the Statement of Profit and Loss within
cost of sales. The determination of useful life is based upon
Management’s judgment and includes assumptions on the timing
and future estimated revenues to be generated by these assets,
which are summarized in Note 2.
Intangible assets comprising film scripts and related costs are
stated at cost less amortization less provision for impairment.
The script costs are amortized over a period of 3 years on a
straight-line basis and the amortization charge is recognized in
the income statement within cost of sales. The determination of
useful life is based upon Management’s estimate of the period
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Corporate overview | ManageMent report | financial management
over which the Company explores the possibility of making films
using the script.
Other intangible assets, which comprise internally generated
and acquired software used within the Entity’s digital, home
entertainment and internal accounting activities, are stated at cost
less amortization less provision for impairment. A charge is made
to write down the cost of software over the estimated useful lives
except where the software is not yet available for use. The average
life of the software is the lesser of 3 years or the remaining life of the
software. The amortization charge is recognized in the Statement
of Profit and Loss.
d.
Impairment of non-financial assets
At each reporting date, for the purposes of assessing impairment,
assets are grouped at the lowest levels for which there are
separately identifiable cash flows (cash generating units). As a
result, some assets are tested individually for impairment and some
are tested at the cash generating unit level. All individual assets or
cash generating units are tested for impairment whenever events
or changes in circumstances both internal and external indicate
that the carrying amount may not be recoverable.
An impairment loss is recognized wherever the carrying amount
of an asset exceeds its recoverable amount which represents the
greater of the net selling price of assets and their ‘value in use’.
In assessing value in use, the estimated future cash flows are
discounted to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of money and
the risks specific to the asset. In determining fair value less costs
of disposal, recent market transactions are taken into account. If
no such transactions can be identified, an appropriate valuation
model is used. These calculations are corroborated by valuation
multiples, quoted share prices for publicly traded companies or
other available fair value indicators.
Film and content rights are stated at the lower of unamortized
cost and estimated recoverable amounts. In accordance with Ind
AS 36 Impairment of Assets, film content costs are assessed for
indication of impairment on a library basis as the nature of the
Company’s business, the contracts it has in place and the markets
it operates in do not yet make an ongoing individual film evaluation
feasible with reasonable certainty. Impairment losses on content
advances are recognized when film production does not seem
viable and refund of the advance is not probable.
All assets are subsequently reassessed for indications that an
impairment loss previously recognized may no longer exist.
impairment loss on risk exposure arising from financial assets
like debt instruments measured at amortised cost e.g., trade
receivables and deposits.
The Company follows ‘simplified approach’ for recognition of
impairment loss allowance on Trade receivables or contract
revenue receivables. The application of simplified approach does
not require the Company to track changes in credit risk. Rather, it
recognises impairment loss allowance based on lifetime ECLs at
each reporting date, right from its initial recognition.
For recognition of impairment loss on other financial assets and
risk exposure, the Company determines that whether there has
been a significant increase in the credit risk since initial recognition.
If credit risk has not increased significantly, 12-month ECL is used
to provide for impairment loss. However, if credit risk has increased
significantly, lifetime ECL is used. If, in a subsequent period, credit
quality of the instrument improves such that there is no longer a
significant increase in credit risk since initial recognition, then the
entity reverts to recognising impairment loss allowance based on
12-month ECL.
Lifetime ECL are the expected credit losses resulting from all
possible default events over the expected life of a financial
instrument. The 12-month ECL is a portion of the lifetime ECL
which results from default events that are possible within 12
months after the reporting date.
ECL is the difference between all contractual cash flows that are
due to the Company in accordance with the contract and all the
cash flows that the entity expects to receive (i.e., all cash shortfalls),
discounted at the original EIR. When estimating the cash flows, an
entity is required to consider all contractual terms of the financial
instrument (including prepayment, extension, call and similar
options) over the expected life of the financial instrument. However,
in rare cases when the expected life of the financial instrument
cannot be estimated reliably, then the entity is required to use the
remaining contractual term of the financial instrument.
ECL impairment loss allowance (or reversal) recognized during the
period is recognized as income/ expense in the Statement of Profit
and Loss (P&L). This amount is reflected under the head ‘other
income or other expenses’ in the P&L.
For assessing increase in credit risk and impairment loss, the
Company combines financial instruments on the basis of shared
credit risk characteristics with the objective of facilitating an
analysis that is designed to enable significant increases in credit
risk to be identified on a timely basis.
e. Borrowing costs
g.
Inventories
The Company is capitalising borrowing costs that are directly
attributable to the acquisition or construction of qualifying assets.
Qualifying assets are assets that necessarily take a substantial
period of time to get ready for their intended use or sale.
Borrowings are recognized initially at fair value, net of transaction
costs incurred. Borrowings are subsequently stated at amortized
cost with any difference between the proceeds (net of transaction
costs) and the redemption value recognized in the income
statement within finance costs over the period of the borrowings
using the effective interest method. Finance costs in respect of film
productions and other assets which take a substantial period of
time to get ready for use or for exploitation are capitalized as part of
the assets. All other borrowing costs are recognized as expense in
the period in which they are incurred and charged to the Statement
of Profit and Loss.
Borrowings are classified as current liabilities unless the
Company has an unconditional right to defer settlement of the
liability for at least 12 months after the balance sheet date.
f.
Impairment of financial assets
In accordance with Ind AS 109, the Company applies expected
credit loss (ECL) model for measurement and recognition of
Inventories primarily comprise of music CDs and DVDs are valued
at the lower of cost and net realizable value. Cost in respect of
goods for resale is defined as all costs of purchase, costs of
conversion and other costs incurred in bringing the inventories
to their present location and condition. Cost in respect of raw
materials is purchase price.
Purchase price is assigned using a weighted average basis.
Net realisable value is the estimated selling price in the ordinary
course of business less the estimated costs of completion and
the estimated costs necessary to make the sale.
h. Provisions, Contingent Liabilities and Contingent Assets
Provisions are recognized when the Company has a present legal
or constructive obligation as a result of a past event, it is more likely
than not that an outflow of resources will be required to settle the
obligations and can be reliably measured. Provisions are measured
at Management’s best estimate of the expenditure required to
settle the obligations at the balance sheet date. If the effect of the
time value of money is material, provisions are discounted using
a current pre-tax rate that reflects, when appropriate, the risks
specific to the liability. When discounting is used, the increase in
the provision due to the passage of time is recognized as a finance
cost.
94 annual REpORt 2017-18
Standalone StatementS
Contingent liabilities are not recognized in the financial statements
but are disclosed by way of notes to accounts unless the possibility
of an outflow of economic resources is considered remote.
Contingent assets are not recognized in financial statements.
However, the same is disclosed, where an inflow of economic
benefit is virtual.
i.
Employee Benefits
Short term employee benefits obligations
Short-term employee benefits are recognized as an expense in the
Statement of Profit and Loss for the year in which related services
are rendered.
Post-employment benefits and other long term employee
benefits
Defined contribution plan
Provident fund & National Pension scheme: The Company’s
contributions paid or payable during the year to the provident fund,
employee’s state insurance corporation and National pension
scheme are recognized in the Statement of Profit and Loss. This
fund is administered by the respective Government authorities,
and the Company has no further obligation beyond making its
contribution, which is expensed in the year to which it pertains.
Defined benefit plan
Gratuity: The Company’s liability towards gratuity is determined
using the projected unit credit method which considers each period
of service as giving rise to an additional unit of benefit entitlement
and measures each unit separately to build up the final obligation.
The cost for past services is recognized on a straight-line basis over
the average period until the amended benefits become vested.
Re-measurement gains and losses are recognized immediately in
the Other Comprehensive Income as income or expense and are
not reclassified to profit or loss in subsequent periods. Obligation
is measured at the present value of estimated future cash flows
using a discounted rate that is determined by reference to market
yields at the Balance Sheet date on Government bonds where the
currency and terms of the Government bonds are consistent with
the currency and estimated terms of the defined benefit obligation.
Compensated absences: Accumulated compensated absences
are expected to be availed or encashed within 12 months from
the end of the year and are treated as short-term employee
benefits. The obligation towards the same is measured at the
expected cost of accumulating compensated absences as the
additional amount expected to be paid as a result of the unused
entitlement as at the year end.
Employee stock option plan
In accordance with Ind AS 102 Share Based Payments, the fair
value of shares or options granted is recognized as personnel
costs with a corresponding increase in equity. The fair value is
measured at the grant date and spread over the period during
which the recipient becomes unconditionally entitled to payment
unless forfeited or surrendered.
The fair value of share options granted is measured using the Black
Scholes model, each taking into account the terms and conditions
upon which the grants are made. At each Balance Sheet date, the
Company revises its estimate of the number of equity instruments
expected to vest as a result of non-market based vesting
conditions. The amount recognized as an expense is adjusted to
reflect the revised estimate of the number of equity instruments
that are expected to become exercisable, with a corresponding
adjustment to equity. The Company's share option plan does not
feature any cash settlement option.
Upon exercise of share options, the proceeds received net of any
directly attributable transaction costs up to the nominal value of the
shares are allocated to equity share capital with any excess being
recorded as securities premium.
j.
Leases
The determination of whether an arrangement is (or contains)
a lease is based on the substance of the arrangement at the
inception of the lease. The arrangement is, or contains, a lease if
fulfilment of the arrangement is dependent on the use of a specific
asset or assets and the arrangement conveys a right to use the
asset or assets, even if that right is not explicitly specified in an
arrangement.
A lease is classified at the inception date as a finance lease or
an operating lease. Leases in which significantly all the risks and
rewards incidental to ownership are transferred to the lessee are
classified as Finance leases. All other leases are Operating Leases.
As a lessee
Finance lease
Leases are classified as finance leases (including those for land), if
substantially all the risks and rewards incidental to ownership of the
leased asset is transferred to the lessee.
At the commencement of the lease term, the Company recognises
finance leases as assets and liabilities in its balance sheet at
amounts equal to the fair value of the leased property or, if lower, the
present value of the minimum lease payments, each determined at
the inception of the lease. The corresponding rental obligations,
net of finance charges, are included in borrowings or other financial
liabilities as appropriate. Any indirect costs of the Company are
added to the amount recognized as an asset.
Minimum lease payments are apportioned between the finance
charge and the reduction of the outstanding liability. The finance
cost is charged to the profit or loss over the lease period so as
to produce a constant periodic rate of interest on the remaining
balance of the liability for each period.
Operating lease
Leases (including those for land) which are not classified as finance
leases are considered as operating lease. Lease payments under
an operating lease are recognized as an expense on a straight-line
basis over the lease term unless either:
A.
B.
Another systematic basis is more representative of the time
pattern of the user’s benefit even if the payments to the
lessors are not on that basis; or
The payments to the lessor are structured to increase in line
with expected general inflation to compensate for the lessor’s
expected inflationary cost increases. If payments to the
lessor vary because of factors other than general inflation,
then this condition is not met.
As a lessor
Finance lease
All assets given on finance lease are shown as receivables
at an amount equal to net investment in the lease. Principal
component of the lease receipts are adjusted against outstanding
receivables and interest income is accounted by applying the
interest rate implicit in the lease to the net investment.
Operating lease
Lease income from operating lease (excluding amount for services
such as insurance and maintenance) is recognized in the statement of
profit or loss on a straight-line basis over the lease term, unless either:
A.
B.
Another systematic basis is more representative of the time
pattern of the user’s benefit even if the payments to the
Company are not on that basis; or
The payments to the Company are structured to increase
in line with expected general inflation to compensate for the
Company’s expected inflationary cost increases. If payments
to the Company vary because of factors other than general
inflation, then this condition is not met.
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k.
Foreign Currency Transactions
Transactions in foreign currencies are translated at the rates of
exchange prevailing on the dates of the transactions. Monetary
assets and liabilities in foreign currencies are translated at the
prevailing rates of exchange at the balance sheet date. Non-
monetary items that are measured at historical cost in a foreign
currency are translated at the exchange rate at the date of the
transaction. Non-monetary items that are measured at fair value in
a foreign currency are translated using the exchange rates at the
date when the fair value was determined.
Any exchange differences arising on the settlement of monetary
items or on translating monetary items at rates different from
those at which they were initially recorded are recognized in the
Statement of Profit and Loss in the period in which they arise. Non-
monetary items carried at fair value that are denominated in foreign
currencies are translated at rates prevailing at the date when the
fair value was determined. Non-monetary items that are measured
in terms of historical cost in a foreign currency are not retranslated.
The Company’s functional currency and the presentation currency
is same i.e. Indian Rupee (`).
l.
Financial instrument
Non-derivative financial instruments
Financial assets and financial liabilities are recognized when the
Company becomes party to the contractual provisions of the
instrument.
Financial assets and liabilities are initially measured at fair value.
Transaction costs that are directly attributable to the acquisition
or issue of financial assets or liabilities (other than financial assets
and liabilities at fair value through Statement of Profit and Loss)
are added to or deducted from the fair value of the financial
assets or financial liabilities, as appropriate, on initial recognition.
Transaction costs directly attributable to the acquisition of financial
assets or financial liabilities at fair value through Statement of Profit
and Loss are recognized immediately in profit or loss. Financial
assets and financial liabilities are offset against each other and the
net amount reported in the balance sheet if, and only if, there is a
currently enforceable legal right to offset the recognized amounts
and there is an intention to settle on a net basis, or to realize the
assets and settle the liabilities simultaneously.
A financial instrument is measured at fair value through profit or
loss if:
•
•
it has been acquired principally for the purpose of selling/
repurchasing it in the near term
on initial recognition it is part of a portfolio of identified
financial instruments that the Company manages together
and has a recent pattern of short term profit taking or
•
it is a derivative that is not designated in a hedging relationship.
The fair value of financial instruments denominated in a foreign
currency is determined in that foreign currency and translated
at the spot rate at the end of the reporting period. The foreign
exchange component forms part of its fair value gain or loss.
Therefore for financial instruments that are classified as fair value
through Statement of Profit and Loss, the exchange component is
recognized in Statement of Profit and Loss.
Financial Assets
Financial assets are divided into the following categories:
financial assets carried at amortised cost
financial assets at fair value through Statement of Profit and
Loss;
Financial assets are assigned to the different categories by
Management on initial recognition, depending on the nature
and purpose of the financial assets. The designation of financial
96 annual REpORt 2017-18
•
•
•
assets is re-evaluated at every reporting date at which a choice of
classification or accounting treatment is available. Financial Assets
like Investments in Subsidiaries are measured at Cost as allowed
by Ind-AS 27 – Separate Financial Statements and hence are not
fair valued.
Financial assets carried at amortised cost
A financial asset is subsequently measured at amortised cost if it is
held within a business model whose objective is to hold the asset
in order to collect contractual cash flows and the contractual terms
of the financial asset give rise on specified dates to cash flows
that are solely payments of principal and interest on the principal
amount outstanding. These are non-derivative financial assets
that are not quoted in an active market. Loans and receivables
(including trade and other receivables, bank and cash balances) are
measured subsequent to initial recognition at amortized cost using
the effective interest method, less provision for impairment. Any
change in their value through impairment or reversal of impairment
is recognized in the Statement of Profit and Loss.
In accordance with Ind AS 109: Financial Instruments, the Company
recognizes impairment loss allowance on trade receivables and
content advances based on historically observed default rates.
Impairment loss allowance recognized during the year is charged
to Statement of Profit and Loss.
Financial assets at fair value through Other Comprehensive
Income
Financial assets at fair value through Other Comprehensive
Income are non-derivative financial assets held within a
business model whose objective is achieved by both collecting
contractual cash flows and selling financial assets and the
contractual terms of the financial asset give rise on specified
dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding.
Financial assets at fair value through profit or loss
A financial asset which is not classified in any of the above categories
are subsequently fair valued through profit or loss. It includes non-
derivative financial assets that are either designated as such or do
not qualify for inclusion in any of the other categories of financial
assets. Gains and losses arising from investments classified under this
category is recognized in the Statement of Profit and Loss when they
are sold or when the investment is impaired.
In the case of impairment, any loss previously recognized in Other
Comprehensive Income is transferred to the Statement of Profit and
Loss. Impairment losses recognized in the Statement of Profit and
Loss on equity instruments are not reversed through the Statement
of Profit and Loss. Impairment losses recognized previously on debt
securities are reversed through the Statement of Profit and Loss
when the increase can be related objectively to an event occurring
after the impairment loss was recognized in the Statement of Profit
and Loss.
When the Company considers that fair value of financial assets
can be reliably measured, the fair values of financial instruments
that are not traded in an active market are determined by using
valuation techniques. The Company applies its judgment to select
a variety of methods and make assumptions that are mainly based
on market conditions existing at each balance sheet date. Equity
instruments measured at fair value through profit or loss that do
not have a quoted price in an active market and whose fair value
cannot be reliably measured are measured at cost less impairment
at the end of each reporting period.
A financial asset is derecognized only where the contractual rights
to the cash flows from the asset expire or the financial asset is
transferred and that transfer qualifies for derecognition. A financial
asset is transferred if the contractual rights to receive the cash
flows of the asset have been transferred or the Company retains
financial assets at fair value through Other Comprehensive
Income
An assessment for impairment is undertaken at least at each
balance sheet date.
Standalone StatementS
the contractual rights to receive the cash flows of the asset but
assumes a contractual obligation to pay the cash flows to one or
more recipients. A financial asset that is transferred qualifies for
derecognition if the Company transfers substantially all the risks
and rewards of ownership of the asset, or if the Company neither
retains nor transfers substantially all the risks and rewards of
ownership but does transfer control of that asset.
Financial liabilities
Financial liabilities are classified as either ‘financial liabilities at fair
value through profit or loss’ or ‘other financial liabilities’. Financial
liabilities are subsequently measured at amortized cost using the
effective interest method or at fair value through profit or loss.
Financial liabilities are classified as at fair value through profit or loss
when the financial liability is held for trading such as a derivative,
except for a designated and effective hedging instrument, or if upon
initial recognition it is thus designated to eliminate or significantly
reduce measurement or recognition inconsistency or it forms part
of a contract containing one or more embedded derivatives and
the contract is designated as fair value through profit or loss.
Financial liabilities at fair value through profit or loss are stated at
fair value. Any gains or losses arising of held for trading financial
liabilities are recognized in profit or loss. Such gains or losses
incorporate any interest paid and are included in the “other gains
and losses” line item.
Other financial liabilities (including borrowing and trade and other
payables) are subsequently measured at amortized cost using the
effective interest method.
The effective interest method is a method of calculating the amortized
cost of a financial liability and of allocating interest expense over the
relevant period. The effective interest rate is the rate that exactly
discounts estimated future cash payments (including all fees and
points paid or received that form an integral part of the effective
interest rate, transaction costs and other premiums or discounts)
through the expected life of the financial liability, or (where appropriate)
a shorter period, to the net carrying amount on initial recognition.
A financial liability is derecognized only when the obligation is
extinguished, that is, when the obligation is discharged or cancelled
or expires. Changes in liabilities fair value that are reported in profit
or loss are included in the Statement of Profit and Loss within
finance costs or finance income.
Financial assets and financial liabilities are offset and the net
amount is reported in the balance sheet when, and only when,
there is a legally enforceable right to offset the recognized amount
and there is intention either to settle on net basis or to realize the
assets and to settle the liabilities simultaneously.
in subsidiaries, branches and associates and interest in joint
arrangements where it is probable that the differences will not
reverse in the foreseeable future.
Deferred tax assets and deferred tax liabilities are offset when
there is a legally enforceable right to set off assets against liabilities
representing current tax and where the deferred tax assets and the
deferred tax liabilities relate to taxes on income levied by the same
governing taxation laws.
Minimum alternate tax (MAT) paid in a year is charged to the
Statement of Profit and Loss as current tax. MAT credit entitlement
is recognized as a deferred tax asset only when and to the extent
there is convincing evidence that the Company will pay normal
income tax during the specified period, which is the period for
which MAT credit is allowed to be carried forward. Such asset is
reviewed at each Balance Sheet date and the carrying amount
of the MAT credit asset is written down to the extent there is no
longer a convincing evidence to the effect that the Company will
pay normal income tax during the specified period.
The carrying amount of deferred tax assets is reviewed at each
reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to utilize all
or part of the deferred tax asset. Unrecognized deferred tax assets
are re-assessed at each reporting date and are recognized to the
extent that it has become probable that future taxable profits will
available to utilize the deferred tax asset.
n.
Earnings per share
Basic EPS is computed by dividing net profit after taxes for the year
by weighted average number of equity shares outstanding during
the financial year, adjusted for bonus share elements in equity
shares issued during the year and excluding treasury shares, if any.
Diluted earnings per share adjusts the figures used in the
determination of basic earnings per share to take into account
the after income tax effect of interest and other financing costs
associated with dilutive potential equity shares and the weighted
average number of additional equity shares that would have been
outstanding assuming the conversion of all dilutive potential
equity shares.
o. Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at
call with banks, other short term highly liquid investments which
are readily convertible into known amounts of cash and are subject
to insignificant risk of changes in value. Bank overdrafts are shown
within borrowings in current liabilities on the balance sheet.
Deposits held with banks as security for overdraft facilities are
included in restricted deposits held with bank.
m. Taxes
p.
Segment reporting
Taxation on profit and loss comprises current tax and deferred tax.
Tax is recognized in the Statement of Profit and Loss except to
the extent that it relates to items recognized directly in equity or
Other Comprehensive Income in which case tax impact is also
recognized in equity or Other Comprehensive Income.
Current tax is provided at amounts expected to be paid (or
recovered) using the tax rates and laws that have been enacted
or substantively enacted at the balance sheet date along with any
adjustment relating to tax payable in previous years.
Deferred income tax is provided in full, using the liability method, on
temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the financial statements.
Deferred income tax is provided at amounts expected to be
paid (or recovered) using the tax rates and laws that have been
enacted or substantively enacted at the balance sheet date and
are expected to apply when the related deferred income tax asset
is realized or the deferred income tax liability is settled.
Deferred tax is not recognized for all taxable temporary differences
between the carrying amount and tax bases of investments
Ind-AS 108 Operating Segments (“Ind-AS 108”) requires operating
segments to be identified on the same basis as is used internally for
the review of performance and allocation of resources by the Chief
Operating Decision Maker. The revenues of films are earned over
various formats; all such formats are functional activities of filmed
entertainment and these activities take place on an integrated
basis. The management team reviews the financial information on
an integrated basis for the Company as a whole, with respective
heads of business for each region and in accordance with Ind-AS
108, the Company provides a geographical split as it considers
that all activities fall within one segment of business which is filmed
entertainment. The management team also monitors performance
separately for individual films or for at least 12 months after the
theatrical release.
The Company has identified three geographic markets: India, UAE
and Rest of the world.
q.
Statement of cash flows
Cash flows are reported using the indirect method, whereby profit
before tax is adjusted for the effects of transactions of a non-cash
EROS IntERnatIOnal MEdIa lIMItEd 97
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nature, any deferrals or accruals of past or future operating cash
receipts or payments and item of income or expenses associated
with investing or financing cash flows. The cash flows from
operating, investing and financing activities of the Company are
segregated.
In line with the amendments to Ind AS 7 Statement of Cash
flows (effective from 1 April, 2017), the Company has provided
disclosures that enable users of financial statements to evaluate
changes in liabilities arising from financing activities, including both
changes arising from cash flows and non-cash changes. The
adoption of amendment did not have any material impact on the
financial statements.
r.
Dividends
The Company recognises a liability for dividends to equity
holders of the Company when the dividend is authorized and
the dividend is no longer at the discretion of the Company. As
per the corporate laws in India, a dividend is authorised when
it is approved by the shareholders. A corresponding amount is
recognized directly in equity.
s.
Event occurring after the reporting date
Adjusting events (that provides evidence of condition that existed
at the balance sheet date) occurring after the balance sheet date
are recognized in the financial statements. Material non-adjusting
events (that are inductive of conditions that arose subsequent to
the balance sheet date) occurring after the balance sheet date that
represents material change and commitment affecting the financial
position are disclosed in the Directors’ Report.
t.
Standards Issued but not yet Effective
Following are the new standards and amendments to existing
standards (as notified by Ministry of Corporate Affairs (MCA) on
28 March 2018) which are effective for annual periods beginning
after 1 April 2018. The Company intends to adopt these standards
or amendments from the effective date.
Ind AS 115 Revenue from contract with customers
Ind AS 115 establishes a comprehensive framework for determining
whether, how much and when revenue is recognized. It replaces
existing revenue recognition guidance, including Ind AS 18 Revenue
and Ind AS 11 Construction Contracts. The core principle of the
new standard that an entity should recognize revenue to depict
the transfer of promised goods or services to customers in an
amount that reflects the consideration to which the entity expects
to be entitled in exchange for those goods or services. Further,
the new standard requires enhanced disclosures about the nature,
amount, timing and uncertainty of revenue and cash flows arising
from the entity’s contracts with customers. This Standard permit
two possible methods of transition i.e. retrospective approach and
modified retrospective method.
Based on the preliminary assessment, the company does not
expect any significant impacts on transition to Ind AS 115. This
assessment is based on currently available information and may be
subject to changes arising from further reasonable and supportable
information when the standard will be adopted. The quantitative
impacts would be finalized based on a detailed assessment which
has been initiated to identify the key impacts along with evaluation
of appropriate transition options to be considered.
Amendments to existing Ind AS
The following amended standards are not expected to have
a significant impact on the Company’s standalone financial
statements. This assessment is based on currently available
information and may be subject to changes arising from further
reasonable and supportable information being made available to
the Company when it will adopt the respective standards.
•
Ind AS 40 - Investment Property - The amendment lays
down the principle regarding the transfer of asset to, or from,
investment property.
98 annual REpORt 2017-18
•
•
Ind AS 21 - The Effects of Changes in Foreign Exchange
Rates - The amendment lays down principles to determine
the date of transaction when a company recognizes a
non-monetary prepayment asset or deferred income liability.
Ind AS 12 - Income Taxes - The amendments explain that
determining temporary differences and estimating probable
future taxable profit against which deductible temporary
differences are assessed for utilization are two separate steps.
2.
Significant
assumptions
accounting
judgements
estimates
and
The preparation of the financial statements requires management
to make judgements, estimates and assumptions, as described
below, that affect the reported amounts and the disclosures. The
Company based its assumptions and estimates on parameters
available when the financial statements were prepared and reviewed
at each balance sheet date. Uncertainty about these assumptions
and estimates could result in outcomes that may require a material
adjustment to the reported amounts and disclosures.
a.
Intangible Assets
The Company is required to identify and assess the useful life
of intangible assets and determine their income generating life.
Judgment is required in determining this and then providing an
amortization rate to match this life as well as considering the
recoverability or conversion of advances made in respect of
securing film content or the services of talent associated with film
production.
Accounting for the film content requires Management’s judgment
as it relates to total revenues to be received and costs to be incurred
throughout the life of each film or its license period, whichever is the
shorter. These judgments are used to determine the amortization
of capitalized film content costs. The Company uses a stepped
method of amortization on first release film content writing off
more in year one which recognizes initial income flows and then
the balance over a period of up to nine years. In the case of film
content that is acquired by the Company after its initial exploitation,
commonly referred to as Library, amortization is spread evenly over
the lesser of 10 years or the license period. Management’s policy
is based upon factors such as historical performance of similar
films, the star power of the lead actors and actresses and others.
Management regularly reviews, and revises when necessary, its
estimates, which may result in a change in the rate of amortization
and/or a write down of the asset to the recoverable amount.
Intangible assets are tested for impairment in accordance with
the accounting policy. These calculations require judgments and
estimates to be made, and in the event of an unforeseen event
these judgments and assumptions would need to be revised and
the value of the intangible assets could be affected. There may be
instances where the useful life of an asset is shortened to reflect the
uncertainty of its estimated income generating life.
b.
Employee benefit plans
The cost of the employment benefit plans and their present value
are determined using actuarial valuations which involves making
various assumptions that may differ from actual developments in
the future. For further details refer to Note 41.
c.
Fair value measurement of ESOP Liability
The fair value of ESOP Liability is determined using valuation
methods which involves making various assumptions that may
differ from actual developments in the future. For further details
refer Note 41.
d.
Trade receivable
Judgements are required in assessing the recoverability of overdue
trade receivables and determining whether a provision against
those receivables is required. Factors considered include the
amount and timing of anticipated future payments and any possible
actions that can be taken to mitigate the risk of non-payment.
Standalone StatementS
e. Depreciation
g. Provisions
Property, plant and equipment are depreciated over the estimated
useful lives of the assets, after taking into account their estimated
residual value. Management reviews the estimated useful lives and
residual values of the assets annually in order to determine the amount
of depreciation to be recorded during any reporting period. The useful
lives and residual values are based on the Company’s historical
experience with similar assets and take into account anticipated
technological changes. The depreciation for future periods is adjusted
if there are significant changes from previous estimates.
f.
Impairment of non-financial assets
In assessing impairment, management estimates the recoverable
amount of each asset or cash-generating unit based on expected
future cash flows and uses an interest rate to discount them.
Estimation uncertainty relates to assumptions about
future
operating results and the determination of a suitable discount rate.
Provisions and liabilities are recognized in the period when it
becomes probable that there will be a future outflow of funds
resulting from past operations or events and the amount of cash
outflow can be reliably estimated. The timing of recognition and
quantification of the liability require the application of judgment to
existing facts and circumstances, which can be subject to change.
Since the cash outflows can take place many years in the future,
the carrying amounts of provisions and liabilities are reviewed
regularly and adjusted to take account of changing facts and
circumstances.
h.
Fair value measurement
Management uses valuation techniques to determine the fair value of
financial instruments (where active market quotes are not available)
and non-financial assets. This involves developing estimates and
assumptions consistent with how market participants would price
the instrument. Management bases its assumptions on observable
data as far as possible, but this is not always available. In that
case management uses the best information available. Estimated
fair values may vary from the actual prices that would be achieved
in an arm’s length transaction at the reporting date.
EROS IntERnatIOnal MEdIa lIMItEd 99
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
3
Property, plant and equipment
Details of the Company’s property, plant and equipment and their carrying amounts are as follows:
Amount ` in lakhs
Gross carrying amount
Buildings
Leasehold
improvements
Furniture
and
fixtures
Motor
vehicles
Office
equipment
Data
processing
equipment
Studio
equipment
Capital
work in
progress
Total
Balance as at 1 April 2016
3,317
-
156
162
48
Additions
Adjustments/ disposals
Capitalized during the year
-
-
-
Balance as at 31 March 2017
3,317
Additions
Adjustments/ disposals
Capitalized during the year
-
-
-
258
118
138
119
-
-
258
114
-
-
-
-
274
-
(0)
-
(4)
-
296
272
(88)
-
(4)
-
163
7
-
-
269
108
-
-
377
5
(8)
-
287
408
4,647
-
-
-
7
-
748
(8)
(402)
(402)
287
13
4,985
-
-
-
114
512
(7)
(103)
(114)
(114)
Balance as at 31 March 2018
3,317
372
274
480
170
374
287
6
5,280
Accumulated depreciation
Balance as at 1 April 2016
Depreciation charge
Adjustments/ disposals
Balance as at 31 March 2017
Depreciation charge
Adjustments/ disposals
Balance as at 31 March 2018
Net carrying amount
161
153
-
314
146
-
460
Balance as at 31 March 2017
Balance as at 31 March 2018
3,003
2,857
-
33
-
33
174
(0)
207
225
165
65
51
-
116
49
(0)
165
158
109
43
62
(3)
102
71
(83)
90
194
390
19
39
(4)
54
50
0
104
109
66
131
118
-
249
76
(8)
317
128
57
90
61
-
151
40
-
191
136
96
-
-
-
-
-
-
-
509
517
(7)
1,019
606
(91)
1,534
13
3,966
6
3,746
1. The Company's immovable property situated in Mumbai, India is pledged against the borrowings as explained in note 19 and 25
2. The Company has used Indian GAAP carrying value of its Property, plant and equipment on date of transition as deemed cost, accordingly,
the net carrying amount as per Indian GAAP as on 1 April 2015 has been considered as gross carrying amount under Ind-AS 101. Details of
accumulated depreciation as on 1 April 2015 are as under:-
Amount ` in lakhs
Gross carrying amount
Buildings
Leasehold
improvements
Furniture
and
fixtures
Motor
vehicles
Office
equipment
Data
processing
equipment
Studio
equipment
Capital
work in
progress
Total
Accumulated depreciation
as on 1 April 2015
791
-
426
191
95
435
1,220
-
3,158
100 annual REpORt 2017-18
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
4
Intangible assets
Details of the Company’s Intangible assets and their carrying amounts are as follows:
Gross carrying amount
Balance as at 1 April 2016
Additions
Transfer to film and content rights
Amount written off
Provision for doubtful advances
Balance as at 31 March 2017
Additions
Transfer to film and content rights
Amount written off
Balance as at 31 March 2018
Accumulated amortization
Balance as at 1 April 2016
Amortization charge
Balance as at 31 March 2017
Amortization charge
Balance as at 31 March 2018
Net carrying amount
Balance as at 31 March 2017
Balance as at 31 March 2018
Content
advances*
Film rights
Other intangible
assets
109,468
79,698
(68,652)
(450)
(97)
119,967
39,442
(21,773)
(228)
144,535
37,321
(3,962)
-
-
177,894
10,936
-
-
137,408
188,830
52,997
36,154
89,151
22,364
111,515
88,743
77,315
119,967
137,408
59
13
-
-
-
72
-
-
-
72
23
15
38
8
46
34
26
Amount ` in lakhs
Total
144,594
37,334
(3,962)
-
-
177,966
10,936
-
-
188,902
53,020
36,169
89,189
22,372
111,561
88,777
77,341
1.
The Company has used Indian GAAP carrying value of its intangible assets on date of transition as deemed cost, accordingly, the net
carrying amount as per Indian GAAP as on 1 April 2015 has been considered as gross carrying amount under Ind-AS 101. Details of
accumulated amortization as on 1 April 2015 are as under:-
Accumulated amortization as on 1 April 2015
223,210
119
223,329
*Net of cumulative provision for doubtful content advances ` Nil ( FY 2016-17: ` 97 Lakhs)
5
Investments
A Non current investments
Unquoted equity shares
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
i) Investment in equity shares of subsidiaries accounted at cost
Eros International Films Private Limited
19,930,300 (31 March 2017 : 19,930,300) equity shares of `10 each, fully paid-up
1,993
1,993
Eros Animation Private Limited
9,300 (31 March 2017 : 9,300) equity shares of ` 10 each, fully paid-up
Copsale Limited
105,000 (31 March 2017 : 105,000) equity shares of USD 1 each, fully paid-up
Big Screen Entertainment Private Limited
6,400 (31 March 2017 : 6,400) equity shares of ` 10 each, fully paid-up
EyeQube Studios Private Limited
9,999 (31 March 2017 : 9,999) equity shares of ` 10 each, fully paid-up
EM Publishing Private Limited
1
45
1
1
1
45
1
1
EROS IntERnatIOnal MEdIa lIMItEd 101
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
5
Investments (Contd.)
9,900 (31 March 2017 : 9,900) equity shares of ` 10 each, fully paid-up
Digicine PTE Limited
100 (31 March 2017 : 100) equity shares of USD 1 each, fully paid-up
Colour Yellow Productions Private Limited
5,000 (31 March 2017 : 5,000) equity shares of ` 10 each, fully paid-up
ii) Investment in equity shares of subsidiaries accounted at fair value
Universal Power Systems Private Limited#
1,000 (31 March 2017 : 1,000) equity shares of ` 100 each, fully paid-up
Less: Provision for impairment in the value of investment
Total
Aggregate value of unquoted investments
Aggregate value of impairment in the value of investment
#Increase in value of investment is due to ESOP benefits provided to subsidiary
6
Loans and advances
Unsecured considered good,unless otherwise stated
Amounts due from related parties (refer note 43)
Other loans and advances
Considered good
Considered doubtful
Less: Allowances for doubtful loans
Total
7
Restricted bank deposits
Bank deposits with maturity of more than twelve months*
Total
* Given as securities to bank for margin
8
Other financial assets
Unsecured and considered good
Security deposits to
- Related parties (refer note 43)
- Others
Total
9
Other non- current assets
Advance payment of income taxes (net of provision)
Balances due with statutory authorities
Total
102 annual REpORt 2017-18
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
1
0
1
5,492
(2,032)
5,503
7,535
2,032
1
0
1
5,312
(552)
6,803
7,355
552
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
39
39
1,682
-
-
1,721
2,473
186
(186)
2,512
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
716
716
217
217
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
617
55
672
651
71
722
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
177
2,774
2,951
326
4,414
4,740
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
10
Inventories
VCD/ DVD/ Audio CDs
Film rights
Total
11 Trade receivables
Secured, considered good
Unsecured, considered good
Considered doubtful
Dues from related parties (refer note 43)
Unbilled Income
Less : Provision for doubtful receivables
Less : Expected credit loss
Total
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
9
178
187
38
8
46
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
1,327
33,616
419
8,791
290
44,443
-
(419)
44,024
1,771
15,724
934
8,589
421
27,439
(106)
(828)
26,505
All amounts are short-term. The net carrying value of trade receivables is considered a reasonable approximation of fair value.
All accounts receivable are pledged against borrowing which are shown under note 19 and 25.
12 Cash and cash equivalents
Cash on hand
Cheques on hand
Balances with banks
In current account
In deposit account (with original maturity of less than 3 months)
Total
13 Restricted bank deposits
Unclaimed dividend account
Margin money accounts with:*
maturity less than twelve months
maturity more than twelve months
Less: disclosed under non current financial assets - Restricted deposits (refer note 7)
Total
* Given as securities to bank for margin
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
7
5
373
-
385
13
20
97
1
131
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
1
1
3,775
716
4,492
(716)
3,776
4,254
217
4,472
(217)
4,255
EROS IntERnatIOnal MEdIa lIMItEd 103
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Notes
to the standalone financial statements and other explanatory information
14 Loans and advances
Unsecured and considered good
Amounts due from related parties (refer note 43)
Loans and advances to employees
Other loans
Security deposits
Total
15 Other financial assets
Accrued interest on fixed deposits
Forward contract assets
Total
16 Other current assets
Prepaid expenses
Total
17 Equity share capital
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
2,662
146
392
5
3,205
867
173
435
4
1,479
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
110
184
294
184
-
184
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
55
55
106
106
` in lakhs, except share data
As at
31 March 2017
As at
31 March 2018
Authorised share capital
Equity shares of ` 10 each
Issued, subscribed and fully paid- up
Equity shares of ` 10 each
Total
a) Reconciliation of paid- up share capital (Equity Shares)
Balance at the beginning of the year
Add: Issued on exercise of employee share options
Balance at the end of the year
Number
Amount
Number
Amount
125,000,000
125,000,000
94,971,877
94,971,877
12,500
12,500
9,497
9,497
125,000,000
125,000,000
93,858,717
93,858,717
12,500
12,500
9,385
9,385
As at
31 March 2018
` in lakhs, except share data
As at
31 March 2017
Number
93,858,717
1,113,160
94,971,877
Amount
Number
Amount
9,385
112
9,497
93,589,164
269,553
93,858,717
9,358
27
9,385
During the year, the Company has issued total 1,113,160 equity shares (31 March 2017: 269,553 ) on exercise of options granted under the
employees stock option plan (ESOP) wherein part consideration was received in the form of employees services.
b)
Shares held by holding company, ultimate holding company, subsidiaries / associates of holding company or ultimate holding company
` in lakhs, except share data
Equity shares of ` 10 each
Eros Worldwide FZ LLC - Holding company
Eros Digital Private Limited - Fellow subsidiary
As at
31 March 2018
As at
31 March 2017
Number
Amount
Number
Amount
35,409,440
21,700,000
3,541
2,170
47,126,290
21,700,000
4,713
2,170
104 annual REpORt 2017-18
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
17 Equity share capital (Contd.)
c) Details of Shareholders holding more than 5% of the shares in the company
As at
31 March 2018
` in lakhs, except share data
As at
31 March 2017
Equity shares of ` 10 each
Eros Worldwide FZ LLC - Holding company
Eros Digital Private Limited - Fellow subsidiary
Number % holding in the
class
Number % holding in the
class
35,409,440
21,700,000
37.28%
22.85%
47,126,290
21,700,000
50.21%
23.12%
d) Details of employee stock options issued during the last 5 years
During the period of five years immediately preceding the reporting date, the Company has issued total 2,149,567 equity shares
(31 March 2017: 1,220,890) on exercise of options granted under the employees stock option plan (ESOP) wherein part consideration was
received in the form of employee services.
e) Details of equity share issued for consideration other than cash during the last 5 years
During the period of five years immediately preceding the reporting date, the Company has issued total 900,970 equity shares
(31 March 2017: 900,970) to the shareholders of Universal Power Systems Private Limited at a premium of ` 586 per share in exchange for the
entire shareholding of Universal Power Systems Private Limited.
f)
Rights, preferences, restrictions of equity shares
The Company has only one class of equity shares having par value of ` 10 per share. Every holder is entitled to one vote per share. The dividend,
if any, proposed by the Board of Directors and approved by the Shareholders in the Annual General Meeting is paid in Indian rupees.
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 of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
18 Other equity
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
Securities premium
Balance at the beginning of the year
Add : Shares issued on employee stock options exercised during the year
Add : Transfer from share option outstanding account
Balance at the end of the year
Share options outstanding account
Balance at the beginning of the year
Less: Transfer to securities premium account
Add: Employee stock option compensation expense
Add: Employee stock option compensation expense to employee’s of subsidiary
Balance at the end of the year
General reserve
Balance as per last balance sheet
Retained earnings
Balance at the beginning of the year
Add: Net profit after tax for the year
Balance at the end of the year
Other comprehensive income
Balance at the beginning of the year
Acturial gain / (loss) on employee benefit plans through OCI
Balance at the end of the year
Total
38,141
247
2,110
40,498
2,645
(2110)
862
180
1,577
526
84,354
7,701
92,055
(10)
56
46
37,513
-
628
38,141
1,775
(628)
1,464
34
2,645
526
71,315
13,039
84,354
12
(22)
(10)
134,702
125,656
1)
Securities Premium Reserve: The amount received in excess of face value of the equity shares is recognized in Securities Premium Reserve.
2) General Reserve: General Reserve was created by transferring a portion of the net profit of the Company as per the requirements of the
Companies Act, 2013.
3)
Retained Earnings: Remaining portion of profits earned by the Company till date after appropriations.
EROS IntERnatIOnal MEdIa lIMItEd 105
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
19 Long-term borrowings
Secured
Term loan from banks*
Car loans#
Unsecured
Term loan from others**
Less: Cumulative effect of unamortised cost
Less: Current maturities disclosed under other current financial liabilities (refer note 27)
Total
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
15,761
330
6,240
22,331
(196)
(7,194)
14,941
22,088
130
-
22,218
(158)
(7,148)
14,912
* Term loans from banks carry an interest rate between 12% - 14% are secured by pari passu first charge on the DVD/ satellite rights
acquired for the domestic market, actionable claims, revenue and receivables arising on sales of the rights and negatives of films. Term
loans are further secured by equitable mortgage of Company's immovable properties situated at Mumbai (India), amounts held as margin
money,corporate guarantee of Eros International PLC (the ultimate holding company), residual value of equipments and vehicles and existing
rights of hindi films with nil book value.
# Car loans are secured by hypothecation of vehicles acquired there against, carrying rate of interest of 7.48%-9.50% which are repayable as per
maturity profile set out below.
** Term loan from others carry an interest rate of 14% are secured against the pledge of company's shares held by holding company, current assets
of a subsidiary company and corporate guarantee of holding company and subsidiary company.
Maturity profile of long term borrowing is set out below:-
Amount ` in lakhs
Less than 1 year
1-3 years
3-5 years
Secured
Term loan from banks
Car loan
Unsecured
Term loan from others
Total
20 Trade payable - non current
Payable to related parties (refer note 43)
Total
21 Other financial liabilities
Security deposits
Total
22 Employee benefit obligations - non current
Provision for gratuity (refer note 41)
Total
106 annual REpORt 2017-18
6,322
132
740
7,194
8,386
198
3,220
11,804
1,053
-
2,280
3,333
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
102
102
101
101
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
-
-
1
1
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
425
425
351
351
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
23 Deferred tax liabilities (net)
Deferred tax liability on
Depreciation on tangible assets
Amortization of intangible assets
Total
Deferred tax asset on
Provision for expenses allowed on payment basis
Others
MAT credit recoverable
Total
Deferred tax liabilities (net)
Reconciliation of statutory rate of tax and effective rate of tax
Profit before tax
Tax expense
Tax rate as a % of profit before tax
Adjustments
Non-deductible expenses for tax purposes
Effect of change in deferred tax balances due to change in tax rates
Tax impact of earlier years
Effect of unrecognized deferred tax assets
Others
At India’s statutory income tax rate of 34.61% (31 March 2017: 34.61%)
24 Other non-current liabilities
Deferred revenue
Total
25 Short-term borrowings
Repayable on demand
Secured
From banks
Unsecured
From others*
From related parties (refer note 43)
Total
Secured short term borrowings include:
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
107
26,795
26,902
971
199
511
1,681
25,221
154
30,221
30,375
741
476
6,800
8,017
22,358
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
14,043
6,342
45.16%
-2.19%
-1.76%
-2.88%
-3.65%
-0.07%
34.61%
21,100
8,061
38.20%
-1.59%
0.00%
-0.95%
-0.91%
-0.14%
34.61%
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
1,512
1,512
3,016
3,016
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
38,813
34,518
4,000
5,808
48,621
2,400
4,616
41,534
Cash credit carry an interest rate between 10% - 13% , secured by way of hypothecation of inventories and receivables relating to domestic rights
operations on pari passu basis.
Bills discounted carry an interest rate between 10% - 11% for INR bills and LIBOR+3.5% for USD bills, secured by document of title to goods
and accepted hundis with first pari passu charge on current assets.
EROS IntERnatIOnal MEdIa lIMItEd 107
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
25 Short-term borrowings (Contd.)
Packing credit carry an interest rate between 10% - 11% for INR and LIBOR + 3.5% for USD, secured by hypothecation of films and film rights
with first pari passu charge on current assets.
Short term borrowings are further secured by equitable mortgage of company's immovable properties situated at Mumbai (India), amount held
in margin money, corporate guarantee of Eros International Plc (the ultimate holding company),residual value of equipments and existing rights
of hindi films with nil book value.
*Loan from others are secured by security provided by holding company.
26 Acceptances
Payable under the film financing arrangements
Total
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
5,796
5,796
5,795
5,795
Acceptances comprise of credit availed from financial institutions for payment to film producers for film co-production arrangement entered by
the group. The carrying value of acceptances are considered a reasonable approximation of fair value.
27 Other financial liabilities
Current maturities of long term borrowings (refer note 19)
Interest accrued but not due
Unclaimed dividend*
Employee dues
Other payables
Other payable to related party (refer note 43 )
Total
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
7,194
294
1
364
394
274
8,521
7,148
382
1
173
1,114
183
9,001
*These figures do not includes any amount due and outstanding to be credited to Investor Education and Protection Fund.
28 Employee benefit obligations - current
Gratuity
Compensated absences
Total
29 Current tax liabilities
Provision for corporate taxes (net)
Total
30 Other current liabilities
Advance from customers- related parties (refer note 43)
Advances from customers- others
Deferred revenue
Duties and taxes payable
Total
108 annual REpORt 2017-18
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
53
159
212
38
160
198
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
3,506
3,506
4,265
4,265
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
3,457
1,145
2,449
6,251
209
1,479
2,810
8,661
13,302
13,159
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
31 Revenue from operations (net)
Revenue from distribution and exhibition of film and other rights
Revenue from services
Total
32 Other income
Sundry balances written back
Interest income on advances
Unwinding of interest on expected credit loss
Other non-operating income
Gain on sale of tangible assets (net)
Bad debts recovered
Income from export incentives
Total
33 Film right cost including amortization costs
Amortization of film rights (refer note 4)
Film rights cost
Total
34 Changes in inventories of film rights
Opening stock
- Finished goods
Closing stock
- Finished goods
Total
35 Employee benefits expense
Salaries and bonus
Contribution to provident and other funds (refer note 41)
Gratuity expense (refer note 41)
Employee stock option compensation (refer note 41)
Staff welfare expenses
Total
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
70,678
88
70,766
114,602
16
114,618
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
69
499
409
1,104
-
10
-
2,091
308
103
-
482
1
8
946
1,848
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
22,364
10,837
33,201
36,154
31,879
68,033
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
45
187
(142)
307
45
262
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
3,328
184
196
834
83
4,625
3,611
195
83
1,398
126
5,413
EROS IntERnatIOnal MEdIa lIMItEd 109
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
36 Finance cost
Interest expense
Other borrowing costs
Interest on late payment of taxes
Less: Interest capitalised to film rights*
Less: Interest income
Total
*The capitalisation rate of interest was 10.91 % (31 March 2017: 9.95 %)
37 Depreciation and amortization expense
Depreciation on tangible assets (refer note 3)
Amortization on intangible assets (refer note 4)
Total
38 Other expenses
Print and digital distribution cost
Selling and distribution expenses
Processing and other direct cost
Shipping, packing and forwarding expenses
Home entertainment products related cost
Power and fuel
Rent
Repairs and maintenance
Insurance
Rates and taxes
Legal and professional
Payments to auditors (refer note 47)
Provision for doubtful receivables
Provision for doubtful advances (refer note 4 and 6)
Communication expenses
Travelling and conveyance
Content advances written off (refer note 4)
Advances and deposits written off
Loss on disposal of fixed assets (net)
Trade receivables written off
Provision for impairment in the value of investment
Loss on foreign currency transactions and translation (net)
CSR expenditure (refer note 49)
Miscellaneous expenses
Total
110 annual REpORt 2017-18
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
7,950
399
1,518
9,867
(2,115)
(264)
7,488
5,036
541
1,489
7,066
(1,657)
(208)
5,201
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
607
8
615
517
15
532
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
1,182
3,491
208
72
23
53
328
130
18
11
1,347
116
-
-
57
208
228
0
1
3,539
1,480
68
0
467
2,669
6,655
572
181
64
56
529
182
20
64
1,282
191
543
283
80
270
450
287
-
206
552
235
10
544
13,027
15,925
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
39 Earnings per share
a) Computation of net profit for the year
Year ended
31 March 2018
Year ended
31 March 2017
Profit after tax attributable to equity shareholders (` in lakhs)
7,701
13,039
b) Computation of number of shares for Basic Earnings per share
Weighted average number of equity shares
Total
c) Computation of number of shares for Diluted Earnings per share
94,524,136
93,654,393
94,524,136
93,654,393
Weighted average number of equity shares used in the calculation of basic earning per share
94,524,136
93,654,393
Add:- Effect of ESOPs
Weighted average number of equity shares used in the calculation of diluted earning
per share
d) Nominal value of shares (in `)
e) Computation
Basic (in `)
Diluted (in `)
1,342,648
1,682,594
95,866,784
95,336,987
10
8.15
8.03
10
13.92
13.68
40 Contingent liabilities and commitments (to the extent not provided for)
Amount ` in lakhs
a) Contingent liabilities
(i) Claims against the Company not acknowledged as debt
Sales tax claims disputed by the Company
Service tax claim disputed by the Company
Income tax liability that may arise in respect of matters in appeal
(ii) Guarantees
Guarantee given in favour of various government authorities
Total (a)
Notes:
As at
31 March 2018
As at
31 March 2017
669
30,811
79
25
317
30,811
60
25
31,584
31,213
1) During the year ended 31 March 2015, the Company received a show cause notice from the Commissioner of Service Tax to show cause why
an amount aggregating to ` 15,675 lakhs for the period 1 April 2009 to 31 March 2014 should not be levied on and paid by the Company for
service tax arising on temporary transfer of copyright services and other matters.
In connection with the aforementioned matters, on 19 May 2015, the Company received an Order-in-original issued by the Principal Commissioner,
Service Tax, wherein the department confirmed the demand of ` 15,675 lakhs along with interest and penalty amounting to ` 15,675 lakhs
resulting into a total demand of ` 31,350 lakhs.
On 3 September 2015, the Company filed an appeal against the said order before the authorities. The Company has paid
` 1,000 Lakhs under protest. Considering the facts and nature of levies and the ad-interim protection for the period 1 July 2010 to 30 June 2012
granted by the Honorable High Court of Mumbai, the Company expects that the final outcome of this matter will be favourable. Accordingly,
based on the assessment made after taking appropriate legal advise, no additional liability has been recorded in the financial statements.
2) Company has received notice for reversal of CENVAT credit for the period 2013-14 to 2015-16 ` 187 lakhs and for the period January 2016
to March 2017 ` 204 lakhs. Further Company also received notice for Non levy of Service tax on Import of Services for the period 2013-14 to
2015-16 for ` 70 Lakhs.
3)
4)
5)
In addition, the Company is liable to pay service tax on use on temporary transfer of copyright in the period 1 July 2010 to 30 June 2012.
The Company filed a writ petition in Mumbai High Court challenging the constitutionality and the legality of this entry and received ad-interim
protection and accordingly, no amounts were provided for by the Company for the period 1 April 2011 to 30 June 2012.
It is not practicable for the Company to estimate the timing of cash outflows, if any, in respect of the above, pending resolution of the respective
proceedings.
From time to time, the ‘Company’ is involved in legal proceedings arising in the ordinary course of its business, typically intellectual property
litigation and infringement claims related to the Company's feature films and other commercial activities, which could cause the Company to incur
expenses or prevent the Company from releasing a film. While the resolution of these matters cannot be predicted with certainty, the Company
does not believe, based on current knowledge or information available, that any existing legal proceedings or claims are likely to have a material
and adverse effect on its financial position, results of operations or cash flows.
EROS IntERnatIOnal MEdIa lIMItEd 111
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
40 Contingent liabilities and commitments (to the extent not provided for) (Contd.)
6)
The Company does not expect any reimbursements in respect of the above contingent liabilities.
b) Commitments
Estimated amount of contracts remaining to be executed on content commitments
Total (b)
Total (a+b)
41 Employment benefits
a) Gratuity
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
169,711
169,711
201,295
157,270
157,270
188,483
The following table set out the status of the gratuity plan as required under Indian Accounting Standard (Ind AS) - 19, Employee benefits, and the
reconciliation of opening and closing balances of the present value of the defined benefit obligation:
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
I Change in projected benefit obligation
Liability at the beginning of the year
Interest cost
Current service cost
Past service cost
Benefits paid
Actuarial loss/(gain) on obligations
Liability at the end of the year
Current portion
Non-current portion
II Recognized in Balance Sheet
Liability at the end of the year
Amount recognized in Balance Sheet
III Expense recognized in Statement of Profit and Loss
Current service cost
Interest cost
Past service cost
Expense recognized in Statement of Profit and Loss
IV Expense recognized in Other Comprehensive Income
Arising from changes in experience
Arising from changes in financial assumptions
Expense/(income) recognized in Other comprehensive income
*Actuarial (gain)/loss of ` 86 lakhs (31 March 2017: ` 22 lakhs) is included in other
comprehensive income.
V Assumptions used
Discount rate
Long-term rate of compensation increase
Attrition Rate
389
29
63
104
(21)
(86)
478
53
425
478
478
63
29
104
196
(66)
(20)
(86)
288
23
60
-
(4)
22
389
38
351
389
389
60
23
-
83
(4)
26
22
7.85%
10.00%
2.00%
7.52%
10.00%
2.00%
Expected average remaining working life in years
17 years
18 years
112 annual REpORt 2017-18
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
41 Employment benefits (Contd.)
VI A quantitative sensitivity analysis for significant assumption as at 31 March 2018 is as shown below:
Impact on defined benefit obligation
Projected benefit obligation on current assumption
Discount rate
1.00 % increase
1.00 % decrease
Salary growth rate
1.00 % increase
1.00 % decrease
Employee turnover
1.00 % increase
1.00 % decrease
VII Maturity profile of defined benefit obligation
Year 1
Year 2
Year 3
Year 4
Year 5
Sum of Years 6-10
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
478
(54)
65
43
(42)
(6)
7
389
(46)
56
25
(26)
(1)
(0)
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
53
18
11
11
30
121
38
7
18
11
10
108
VIII
Interest rate risk: A fall in the discount rate which is linked to the G.Sec. Rate will increase the present value of the liability requiring higher
provision.
IX Salary Risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of members. As such, an
increase in the salary of the members more than assumed level will increase the plan's liability.
X
Asset Liability Matching Risk: The plan faces the ALM risk as to the matching cash flow. Company has to manage pay-out based on
pay as you go basis from own funds
XI Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any
longevity risk.
b) Compensated absences
The Company incurred ` 29 lakhs (31 March 2017 : ` 129 lakhs) towards accrual for compensated absences during the year.
c) Provident fund
The Company contributed ` 168 lakhs (31 March 2017 : ` 181 lakhs) to the provident fund plan, ` 5 lakhs (31 March 2017 : ` 4 lakhs) to the Employee
state insurance plan and ` 11 lakhs (31 March 2017 : ` 10 lakhs) to the National Pension Scheme during the year.
d) Share-based payment transactions
The Company has instituted Employees’ Stock Option Plan “ESOP 2009” and "ESOS 2017" under which the stock options
have been granted to employees. The scheme was approved by the shareholders at the Extra Ordinary General Meeting held on
4 December 2009 and Annual General Meeting held on 28 September 2017 respectively. The details of activity under the ESOP 2009 scheme
are summarized below:
EROS IntERnatIOnal MEdIa lIMItEd 113
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
41 Employment benefits (Contd.)
The expense recognized for employee services received during the year is shown in the following table:
Expense arising from equity-settled share-based payment transactions
There were no cancellations or modifications to the awards in 31 March 2018 or 31 March 2017.
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
834
1,398
Movements during the year
The following table illustrates the number and weighted average exercise prices (WAEP) of, and movements in, share options during the year:
Outstanding at 1 April
Granted during the year
Forfeited during the year
Exercised during the year
Outstanding at 31 March
Exercisable at 31 March
Range of exercise price of outstanding options (`)
Weighted average remaining contractual life of option
* WAEP denotes weighted average exercise price of the option
As at 31 March 2018
As at 31 March 2017
Number
WAEP*
Number
WAEP*
2,108,063
863,320
(234,189)
(1,113,160)
1,624,034
501,122
36
10
10
32
29
71
2,196,215
282,227
(100,826)
(269,553)
2,108,063
911,854
35
10
10
10
36
64
` 10-175
2.96 Years
` 10-175
4.07 Years
Black Scholes valuation model has been used for computing the weighted average fair value considering the following inputs:
Date of grant
Particulars
17-Dec-09 12-Aug-10 1-Jul-12 14-Oct-13 12-Nov-14 12-Feb-15 9-Feb-16 10-Feb-17 14-Nov-17 10-Feb-18
Dividend yield (%)
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Expected volatility
75.00% 60.00% 44.00%
35.00% 40.11% 37.84% 46.46% 48.66% 56.53% 53.15%
Risk free interest rate
6.30%
6.50%
8.36%
8.57%
8.50%
7.74%
7.49%
6.51%
6.90%
7.38%
Exercise price
75-175
75-135
Expected life of options
granted in years
Table 1.1
5.25
5.25
Expected life of options granted in years
75
5.50
150
4.50
10
10
10
A s p e r Ta b l e 1 . 1
10
4.27
10
3.50
10
4.50
Option Grant date
9-Feb-16
12-Feb-15
12-Nov-14
Year I
Year II
Year III
Old Employees New Employees Old Employees New Employees Old Employees New Employees
3.50
4.50
5.50
4.50
5.50
6.50
3.00
3.50
4.00
3.00
4.00
4.50
3.50
4.50
5.50
4.50
5.50
6.50
The expected life of options is based on historical data and current expectations and is not necessarily indicative of exercise patterns that may
occur. The expected volatility reflects the assumption that the historical volatility over a period similar to the life of the options is indicative of future
trends, which may differ from the actual.
114 annual REpORt 2017-18
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
42 Operating Segment
Description of segment and principal activities
The Company acquires, co-produces and distributes Indian films in multiple formats worldwide. Film content is monitored and strategic decisions
around the business operations are made based on the film content, whether it is new release or library. Hence, Management identifies only
one operating segment in the business, film content. The Company distributes film content to the Indian population in India and worldwide and
to non-Indian consumers who view Indian films that are subtitled or dubbed in local languages. As a result of these distribution activities, the
management examines the performance of the business from a geographical market perspective.
Revenue by region of domicile of customer's location
India
United Arab Emirates*
Rest of the world
Total revenue
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
60,084
10,382
300
70,766
78,598
35,587
433
114,618
For the year ended 31 March 2018 and 31 March 2017 no third party customers accounted for more than 10% of the entity's total revenues.
* Sales to United Arab Emirates includes sales to its related party Eros Worldwide FZ LLC.
Non-current assets other than financial instruments, investments accounted for using equity method and income taxes
Non-current assets
India
United Arab Emirates
Rest of the world
Total non-current assets
43 Related party disclosures
a) Parent entity
Relationship
Ultimate holding company
Holding company
b) Subsidiaries
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
220,108
-
2,558
222,666
209,584
-
7,592
217,176
Name
Eros International PLC
Eros Worldwide FZ LLC
Relationship
Name
Subsidiary companies
Eros International Films Private Limited
Copsale Limited
Big Screen Entertainment Private Limited
EyeQube Studios Private Limited
EM Publishing Private Limited
Eros Animation Private Limited
Digicine PTE Limited
Colour Yellow Productions Private Limited
Universal Power Systems Private Limited
Ayngaran International Limited (Isle of Man) (upto 30-09-2017) *
Ayngaran International UK Limited (upto 30-09-2017) *
Ayngaran International Mauritius Limited (upto 30-09-2017) *
Ayngaran International Media Private Limited (upto 30-09-2017) *
Ayngaran Anak Media Private Limited (upto 30-09-2017) *
Eros International Distribution LLP
* The Company has divested five subsidiaries w.e.f. 1 October 2017.
EROS IntERnatIOnal MEdIa lIMItEd 115
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
43 Related party disclosures (Contd.)
List of Key management personnel (KMP)
Mr. Sunil Arjan Lulla – Executive Vice Chairman and Managing Director
Mr. Kishore Arjan Lulla – Executive Director
Mrs. Jyoti Deshpande – Executive Director
Mr. Vijay Ahuja – Non Executive Director (retired by rotation as on 29 September 2016)
Mr. Dinesh Modi -Group Chief Financial Officer (India) (upto 8 March 2018)
Mr. Farokh P. Gandhi - Chief Financial Officer (w.e.f. 9 March 2018)
Mrs. Dimple Mehta - Vice President Company Secretary and Compliance Officer (upto 14 December 2017)
Mr. Abhishekh Kanoi - Vice President Company Secretary and Compliance Officer (w.e.f. 15 December 2017)
Relatives of KMP with whom transactions exist
Mrs. Manjula K Lulla (wife of Mr. Kishore Arjan Lulla)
Mrs. Krishika Lulla (wife of Mr. Sunil Arjan Lulla)
Entities over which KMP exercise significant influence
Shivam Enterprises
Fellow subsidiary company
Eros Television India Private Limited
Eros Digital Private Limited
Eros International Limited, United Kingdom
Eros Digital FZ LLC
116 annual REpORt 2017-18
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
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EROS IntERnatIOnal MEdIa lIMItEd 117
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
43 Related party disclosures (Contd.)
c
(ii) Transactions during the year with related parties
Sale of film rights
Eros Worldwide FZ LLC
EM Publishing Private Limited
Universal Power Systems Private Limited
Total
Revenue attributable to Eros Digital FZ LLC
Sale of prints/VCD/DVD
Eros Worldwide FZ LLC
Total
Purchase of film rights
Eros International Films Private Limited
Colour Yellow Productions Private Limited
Total
Re-imbursement of administrative expense
Eros Worldwide FZ LLC
Eros Digital FZ LLC
Eros International Films Private Limited
Big Screen Entertainment Private Limited
Ayngaran International Media Private Limited
Ayngaran Anak Media Private Limited
Total
Re-imbursement given
Eros International Films Private Limited
Colour Yellow Productions Private Limited
Total
Commission expenses
Universal Power Systems Private Limited
Total
Other Income
Big Screen Entertainment Private Limited
Total
Investment in
Universal Power Systems Private Limited
Total
Rent expenses
Mr. Sunil Arjan Lulla
Mrs. Manjula K Lulla
Mr. Kishore Arjan Lulla
Total
Interest income
EyeQube Studios Private Limited
Eros International Limited
Universal Power Systems Private Limited
Total
118 annual REpORt 2017-18
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
10,592
36,895
-
9
10,601
(9,769)
6
6
651
3,288
3,939
460
6,834
12
0
0
0
6
18
36,919
(3,571)
40
40
15,331
1,692
17,023
494
2,090
12
1
0
0
7,306
2,597
-
58
58
8
8
1
1
180
180
276
36
240
552
3
432
24
459
50
146
196
12
12
179
179
34
34
276
36
240
552
2
41
-
43
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
43 Related party disclosures (Contd.)
Interest expenses
Eros Digital Private Limited
Eros Television India Private Limited
Eros International Films Private Limited
Total
Salary, commission and perquisites* to KMPs
Mr. Sunil Arjan Lulla
Mr. Kishore Arjan Lulla
Mrs. Jyoti Deshpande
Mrs. Krishika Lulla
Mr. Dinesh Modi** - Chief Financial Officer (India) (upto 8 March 2018)
Mr. Farokh P. Gandhi - Chief Financial Officer (w.e.f. 9 March 2018)
Mrs. Dimple Mehta**
Mr. Abhishekh Kanoi**
Total
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
49
482
186
717
438
128
714
86
220
5
53
14
1,658
46
24
-
70
463
116
105
89
93
-
50
-
916
* Perquisites to KMP have been valued as per Income tax Act, 1961 and rules framed thereunder or at actuals as the case may be.
** Excludes ` 72 lakhs (31 March 2017 : ` 66 lakhs) charged to Statement of Profit and loss on account of stock Compensation for awards
granted.
d)
Transactions with related parties
Content advances given
Eros International Limited
Colour Yellow Productions Private Limited
Total
Loan and advances given
Ayngaran International Media Private Limited
EyeQube Studios Private Limited
Eros Animation Private Limited
EM Publishing Private Limited
Universal Power Systems Private Limited
Copsale Limited
Eros Television India Private Limited
Total
Refund of content advances
Eros International Limited
Eros International Films Private Limited
Colour Yellow Productions Private Limited
Total
Recovery of loans and advances given
EM Publishing Private Limited
Universal Power Systems Private Limited
Ayngaran International Media Private Limited
Ayngaran Anak Media Private Limited
Eros Television India Private Limited
Total
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
7,414
6,201
13,615
8
3
0
0
2,856
1,516
65
4,448
12,603
-
-
12,603
-
2,044
794
0
62
2,900
5,268
1,959
7,227
-
5
1
-
-
-
-
6
2,689
-
128
2,817
20
1,000
-
-
-
1,020
EROS IntERnatIOnal MEdIa lIMItEd 119
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
43 Related party disclosures (Contd.)
Trade advances/ loans taken
Eros Worldwide FZ LLC
Eros Television India Private Limited
Eros International Films Private Limited
Universal Power Systems Private Limited
Total
Repayment of advances/ loans
Eros Worldwide FZ LLC
Eros Digital Private Limited
Big Screen Entertainment Private Limited
Eros Television India Private Limited
Eros International Films Private Limited
Total
Refund of deposits
Mr. Sunil Arjan Lulla
Total
e) Balances with related parties
Trade balances due from
Eros Worldwide FZ LLC
Eros Digital FZ LLC
Total
Trade balances due to
Eros International Limited
Big Screen Entertainment Private Limited
Colour Yellow Productions Private Limited
Eros International Films Private Limited
Universal Power Systems Private Limited
Eros Digital FZ LLC
Total
Advances due to
Eros Worldwide FZ LLC
Universal Power Systems Private Limited
Total
Loans due to
Eros Digital Private Limited
Eros Television India Private Limited
Eros International Films Private Limited
Total
Content advances given to
Colour Yellow Productions Private Limited
Eros International Limited
Total
120 annual REpORt 2017-18
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
3,257
610
8,656
-
12,523
-
23
22
5,254
4,939
10,238
33
33
3,460
4,150
4,995
14
12,619
29,924
10
-
10
4,995
34,939
26
26
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
6,477
2,314
8,791
102
105
2,271
-
24
7,267
9,769
3,452
5
3,457
480
-
5,328
5,808
6,722
-
6,722
7,128
1,461
8,589
101
129
2,277
1,429
15
283
4,234
195
14
209
454
4,162
-
4,616
3,180
5,189
8,369
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
43 Related party disclosures (Contd.)
Loans and advances due from
Shivam Enterprises
EM Publishing Private Limited
Ayngaran International Media Private Limited
Digicine Pte Limited
EyeQube Studios Private Limited
Universal Power Systems Private Limited
Eros Animation Private Limited
Mrs. Krishika Lulla
Eros Television India Private Limited
Ayngaran Anak Media Private Limited
Copsale Limited
Eros International Limited
Total
Security Deposits/Amounts due from KMPs or their relatives
Mr. Sunil Arjan Lulla
Mrs. Manjula K. Lulla
Mr. Kishore Arjan Lulla
Total
Amounts due to KMPs or their relatives
Mr. Sunil Arjan Lulla
Mr. Kishore Arjan Lulla
Mrs. Manjula K. Lulla
Mrs. Jyoti Deshpande
Total
44
Categories of financial assets and financial liabilities
The carrying value of financial instruments by categories are as follows:
Financial assets
Measured at fair value through Statement of Profit and Loss
Investments*
Total
Measured at amortised cost
Loans and advances
Restricted deposits
Other financial assets
Trade receivables
Cash and cash equivalents
Total
Financial liabilities
Measured at amortised cost
Borrowings
Acceptance
Trade payables
Other financial liabilities
Total
*Exclude financial instruments of investment in subsidiaries carried at cost.
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
39
20
-
34
30
836
1
-
3
-
1,516
222
2,701
302
75
240
617
117
115
42
-
274
39
20
787
34
24
-
1
1
0
0
-
-
906
336
75
240
651
121
43
7
12
183
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
3,460
3,460
4,926
4,492
966
44,024
385
54,793
63,562
5,796
17,125
8,521
95,004
4,760
4,760
3,991
4,472
906
26,505
131
36,005
56,446
5,795
10,832
9,001
82,074
EROS IntERnatIOnal MEdIa lIMItEd 121
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
45 Fair value measurement of financial instruments
Financial assets and financial liabilities measured at fair value in the balance sheet are grouped into three Levels of a fair value hierarchy. The three
Levels are defined based in the observability of significant inputs to the measurement, as follows:
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e as price) or indirectly
(i.e. derived from price)
Level 3: unobservable inputs for the asset or liability
a.
The following table shows the Levels within the hierarchy of financial assets and liabilities measured at fair value on a recurring
basis:
Particulars
Financial assets
Measured at fair value through Statement of Profit and
Loss
Investments*
Total
As at
31 March 2018
Level 1
Level 2
Level 3
Amount ` in lakhs
3,460
3,460
-
-
-
-
3,460
3,460
b.
The following table shows the financial assets and liabilities measured at amortised cost on a recurring basis:
Particulars
Measured at amortised cost
Financial assets
Loans and advances
Restricted bank deposits
Other financial assets-Non current
Other financial assets- Current
Trade receivables
Cash and cash equivalents
Total
Financial liabilities
Measured at amortised cost
Borrowings-Non current
Borrowings- Current
Acceptance
Trade payables
Other financial liabilities
Total
As at
31 March 2018
Level 1
Level 2
Level 3
Amount ` in lakhs
4,926
4,492
672
294
44,024
385
54,793
14,941
48,621
5,796
17,125
8,521
95,004
672
-
672
-
14,941
-
14,941
-
*Exclude financial instruments of investment in subsidiaries carried at cost.
During the year ended 31 March 2018 there was no transfers between level 2 and level 3 fair value hierarchy.
Fair value of cash and short term deposits, trade and other short term receivables, trade payables, other current liabilities and short term
borrowings carried at amortised cost is not materially different from its carrying cost largely due to short term maturities of these financial assets
and liabilities
Fair value of the borrowing items fall within level 2 of the fair value hierarchy and is calculated on the basis of discounted future cash flows.
Non-listed shares and other securities fall within level 3 of the fair value hierarchy. Valuation is based on the discounted future cash flow method.
Financial instruments with fixed and variable interest rate fall within level 2 of the fair value hierarchy and are evaluated by Company based on
parameters such as interest rate, credit rating or assessed credit worthiness.
122 annual REpORt 2017-18
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
45 Fair value measurement of financial instruments (Continued)
a. The following table shows the Levels within the hierarchy of financial assets and liabilities measured at fair value on a recurring
basis:
Particulars
Financial assets
Measured at fair value through Statement of Profit
and Loss
Investments*
Total
As at
31 March 2017
Level 1
Level 2
Level 3
Amount ` in lakhs
4,760
4,760
-
-
-
-
4,760
4,760
b.
The following table shows the financial assets and liabilities measured at amortised cost on a recurring basis:
Particulars
Measured at amortised cost
Loans and advances
Restricted bank deposits
Other financial assets-Non current
Other financial assets- Current
Trade receivables
Cash and cash equivalents
Total
Financial liabilities
Measured at amortised cost
Borrowings-Non current
Borrowings- Current
Acceptance
Trade payables
Other financial liabilities
Total
As at
31 March 2017
Level 1
Level 2
Level 3
Amount ` in lakhs
3,991
4,472
722
184
26,505
131
36,005
14,912
41,534
5,795
10,832
9,001
82,074
722
-
722
-
14,912
-
14,912
-
*Exclude financial instruments of investment in subsidiaries carried at cost.
During the year ended 31 March 2017 there was no transfers between level 2 and level 3 fair value hierarchy.
Fair value of cash and short term deposits, trade and other short term receivables, trade payables, other current liabilities and short term
borrowings carried at amortised cost is not materially different from its carrying cost largely due to short term maturities of these financial assets
and liabilities
Following table shows the reconciliation from the opening balances to the closing balances of the level 3 values:-
Particulars
Balance as on 1 April 2016
Add: Employee stock option compensation expense to employee’s of subsidiary
Less: Fair value loss recognized through Statement of Profit and Loss
Balance as on 31 March 2017
Add: Employee stock option compensation expense to employee’s of subsidiary
Less: Fair value loss recognized through Statement of Profit and Loss
Balance as on 31 March 2018
Amount ` in lakhs
5,278
34
(552)
4,760
180
(1,480)
3,460
EROS IntERnatIOnal MEdIa lIMItEd 123
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
45 Fair value measurement of financial instruments (Continued)
Financial asset
Fair value as at
(` in Lakhs)
Fair value
hierarchy
31 March 2018
31 March 2017
Valuation
techniques and key
inputs
Significant
unobservable
input
Relationship of
unobservable input
to fair value
Investment in
unquoted equity
share
Equity share of
:- Universal Power
Systems Private
Limited - ` 3,460
Equity share of
:- Universal Power
Systems Private
Limited - ` 4,760
Level 3
Income approach - In
this approach, the
discounted cash flow
method was used to
capture the present
value of the expected
future economic
benefit to be derived
from the ownership
of these equity
instruments.
The significant
inputs were:-
a) the estimated
cash flow; and
b) the discount
rate to compute
the present value
of the future
expected cash
flow.
A 0.5% increase
/ decrease in the
discount rate used
would decrease/
increase the fair
value of unquoted
equity instruments
by
` 180 lakhs /
` 200 lakhs
(`120 lakhs /
` 20 lakhs As at 31
March 2017).
46 Financial instruments and Risk management
The Company is exposed to various risks in relation to financial instruments. The Company’s financial assets and liabilities by category are
summarised in note 44 The main types of risks are market risk, credit risk and liquidity risk.
The Company’s risk management is coordinated in close cooperation with the board of directors and audit committee meetings.
The Company has established objectives concerning the holding and use of financial instruments. The underlying basis of these objectives is to
manage the financial risks faced by the Company.
Formal policies and guidelines have been set to achieve these objectives. The Company does not enter into speculative arrangements or trade
in financial instruments and it is the Company’s policy not to enter into complex financial instruments unless there are specific identified risks for
which such instruments help mitigate uncertainties.
Management of Capital Risk and Financial Risk
The Company manages its capital to ensure that it will be able to continue as a going concern while maximizing the return to shareholders
through the optimization of the debt and equity balance. The Company monitors capital using a gearing ratio, which is net debt divided by total
capital. For the purpose of the Company’s capital management, capital includes issued capital and all other equity reserves attributable to the
equity shareholders of the Company. Net debt is calculated as borrowing (refer note 19,25,26 and 27) less cash and cash equivalents.
The gearing ratio at the end of the reporting period was as follows:
Debt*
Less: Cash and cash equivalents
Net debt
Equity
Net debt to equity
*exclude's cumulative effect of unamortised cost
Financial risk management objectives
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
76,748
(385)
76,363
144,199
52.96%
69,547
(131)
69,416
135,041
51.40%
Based on the operations of the Company, Management considers that key financial risks that it faces are credit risk, currency risk, liquidity risk
and interest rate risk. The objectives under each of these risks are as follows:
• credit risk: minimize the risk of default and concentration.
• currency risk: reduce exposure to foreign exchange movements principally between INR and USD.
• liquidity risk: ensure adequate funding to support working capital and future capital expenditure requirements.
• interest rate risk: mitigate risk of significant change in market rates on the cash flow of issued variable rate debt.
124 annual REpORt 2017-18
Standalone StatementS
Notes
to the standalone financial statements and other explanatory information
46 Financial instruments and Risk management (Contd.)
Credit Risk
The Company’s credit risk is principally attributable to its trade receivables, loans and bank balances. As a number of the Company’s trading
activities require third parties to report revenues due to the Company this risk is not limited to the initial agreed sale or advance amounts. The
amounts shown within the Balance Sheet in respect of trade receivables and loans are net of allowances for doubtful debts based upon objective
evidence that the Company will not be able to collect all amounts due.
Trading credit risk is managed on a customer by customer basis by the use of credit checks on new clients and individual credit limits, where
appropriate, together with regular updates on any changes in the trading partner’s situation. In a number of cases trading partners will be required
to make advance payments or minimum guarantee payments before delivery of any goods. The Company reviews reports received from third
parties and in certain cases as a matter of course reserve the right within the contracts it enters into to request an independent third party audit
of the revenue reporting.
The credit risk on bank balances is limited because the counterparties are banks with high credit ratings as signed by international credit rating
agencies.
The Company from time to time will have significant concentration of credit risk in relation to individual theatrical releases, television syndication
deals or digital licenses. This risk is mitigated by contractual terms which seek to stagger receipts and/or the release or airing of content.
As at 31 March 2018 51% (31 March 2017: 66%) of trade account receivables were represented by the top 5 customer, out of which as at
31 March 2018 15% (31 March 2017: 33%) of trade account receivables were represented by the related parties. The maximum exposure to
credit risk is that shown within the statement of financial position.
As at 31 March 2018, the Company did not hold any material collateral or other credit enhancements to cover its credit risks associated with its
financial assets, except certain secured debtors as disclosed in note 11.
Currency Risk
The Company is exposed to foreign exchange risk from foreign currency transactions. As a result it faces both translation and transaction
currency risks which are principally mitigated by matching foreign currency revenues and costs wherever possible.
The Company has identified that it will need to utilize hedge transactions to mitigate any risks in movements between the US Dollar and the Indian
Rupee and has adopted an agreed set of principles that will be used when entering into any such transactions. No such transactions have been
entered into to date and the Company has managed foreign currency exposure to date by seeking to match foreign currency inflows and outflows
as much as possible such as packing credit repayment in USD is matched with remittances from UAE in USD. Details of the foreign currency
borrowings that the Company uses to mitigate risk are shown within Interest Risk disclosures.
The Company adopts a policy of borrowing where appropriate in the foreign currency as a hedge against translation risk. The table below
shows the Company’s net foreign currency monetary assets and liabilities position in the main foreign currencies, translated to Indian Rupees(`)
equivalents, as at the year end:
Net balance receivables / (payables)
Amount in lakhs
As at 31 March 2018
INR
1,339
USD
25
As at 31 March 2017
The above foreign currency arises when the Company holds monetary assets and liabilities denominated in a currency other than INR.
8,008
128
SGD
0
0
GBP
(3)
(3)
A uniform decrease of 10% in exchange rates against all foreign currencies in position as of 31 March 2018 would have decreased in the
Company’s net profit before tax by approximately ` 102 lakhs (31 March 2017: loss of ` 801 lakhs). An equal and opposite impact would be
experienced in the event of an increase by a similar percentage.
Liquidity risk
The Company manages liquidity risk by maintaining adequate reserves and agreed committed banking facilities. Management of working
capital takes account of film release dates and payment terms agreed with customers.
A maturity analysis for financial liabilities is provided below. The amounts disclosed are based on contractual undiscounted cash flows. The table
includes both interest and principal cash flows. To the extent that interest flows are floating rate, the undiscounted amount is derived from interest
rates as at 31 March in each year.
As at 31 March 2018
Borrowing principal payments
Borrowing interest payments
Acceptance
Trade and other payables
Total
Less than 1
year
1-3 years
3-5 years More than 5
years
Amount ` in lakhs
70,952
9,405
5,796
18,156
55,815
6,715
5,796
18,054
11,804
2,416
-
102
3,333
274
-
-
-
-
-
-
EROS IntERnatIOnal MEdIa lIMItEd 125
Corporate overview | ManageMent report | financial management
Notes
to the standalone financial statements and other explanatory information
46 Financial instruments and Risk management (Contd.)
As at 31 March 2017
Borrowing principal payments
Borrowing interest payments
Acceptance
Trade and other payables
Total
Less than 1
year
1-3 years
3-5 years More than 5
years
Amount ` in lakhs
63,752
48,682
9,877
5,795
6,948
5,795
12,303
12,201
10,403
2,496
-
102
4,667
433
-
-
-
-
-
-
At 31 March 2018, the Company had facilities available of ` 71,354 Lakhs (31 March 2017: ` 70,990 Lakhs) and had net undrawn amounts of
` 414 Lakhs (31 March 2017: ` 1,444 Lakhs) available.
Interest rate risk
Fluctuation in fair value or future cash flows of a financial instrument because of changes in market interest rates gives rise to interest rate risk.
A uniform increase of 100 basis in interest rates against all borrowings in position as of 31 March 2018 would have decreased in the Company’s
net profit before tax by approximately ` 317 Lakhs (31 March 2017: net profit before tax of ` 213 Lakhs). An equal and opposite impact would
be experienced in the event of a decrease by a similar basis.
47 Auditors' remuneration
As auditor
Statutory audit
Limited review
Tax audit
In other capacity
Other services (certification fees)
Reimbursement of expenses
Total
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
60
25
7
92
14
14
10
116
115
44
7
166
9
9
16
191
48 Based on the information available with the Company, there are no dues payable as at the year end to micro, small and medium enterprises
as defined in The Micro, Small & Medium Enterprises Development Act, 2006. This information has been relied upon by the statutory
auditors of the Company.
49 As per the provision of the Act, a Corporate Social Responsibility (CSR) committee has been formed by the Company. CSR objects chosen
by the Company primarily consist of promoting education, promoting gender equality, empowering women, setting up homes and hostels for
women and orphans etc. As per the provisions of the Act, gross amount required to be spent by the Company is ` 448 lakh (31 March 2017 :
` 427 lakh), of which ` 0 lakhs (31 March 2017 : ` 10 lakh) have been spent during the current year.
50 Post reporting date events
No adjusting or significant non-adjusting events have occurred between 31 March 2018 and the date of authorisation of these standalone
financial statements.
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No.: 101720W
For and on behalf of Board of Directors
Sd/-
Amit Chaturvedi
Partner
Membership No: 103141
Sd/-
Sunil Arjan Lulla
Executive Vice Chairman and Managing Director
(DIN: 00243191)
Sd/-
Farokh P. Gandhi
Chief Financial Officer
Place: Mumbai
Date : 23 May 2018
Place: Mumbai
Date : 23 May 2018
126 annual REpORt 2017-18
Sd/-
Sunil Srivastav
Non Executive Independent Director
(DIN: 00237561)
Sd/-
Abhishekh Kanoi
Vice President - Company Secretary
and Compliance Officer
Standalone StatementS
INDEPENDENT AUDITOR’S REPORT
To the Members of
Eros International Media Limited
Report on the Consolidated Financial Statements
We have audited the accompanying consolidated financial statements of
Eros International Media Limited (hereinafter referred to as “the Holding
Company”), its subsidiaries (the Holding Company and its subsidiaries
together referred to as “the Group”), comprising of the consolidated
Balance Sheet as at 31 March 2018, the consolidated Statement of Profit
and Loss (including Other Comprehensive Income), the consolidated
Cash Flow Statement, the consolidated Statement of Changes in
Equity for the year then ended, and a summary of significant accounting
policies and other explanatory information (hereinafter referred to as ‘the
consolidated financial statements’).
Management’s Responsibility for the Consolidated Financial
Statements
The Holding Company’s Board of Directors is responsible for the
preparation of these consolidated financial statements in terms of the
requirement of the Companies Act, 2013 (“the Act”) that give a true and
fair view of the consolidated financial position, consolidated financial
performance (including Other Comprehensive Income), consolidated
cash flows and consolidated statement of changes in equity of the
Group in accordance with accounting principles generally accepted in
India, including the Indian Accounting Standards specified under Section
133 of the Act, read with Companies (Indian Accounting Standards)
Rules, 2015, as amended. The respective Board of Directors of the
companies included in the Group are responsible for maintenance of
adequate accounting records in accordance with the provisions of the
Act for safeguarding of the assets of the Group and for preventing and
detecting frauds and other irregularities; the selection and application
of appropriate accounting policies; making judgments and estimates
that are reasonable and prudent; and the design, implementation and
maintenance of adequate internal financial controls that were operating
effectively for ensuring the accuracy and completeness of the accounting
records, relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error, which have been used for
the purpose of preparation of the consolidated financial statements by
the Directors of the Holding Company, as aforesaid.
Auditor’s Responsibility
Our responsibility is to express an opinion on these consolidated financial
statements based on our audit. While conducting the audit, we have
taken into account the provisions of the Act, the accounting and auditing
standards and matters which are required to be included in the audit
report under the provisions of the Act and the Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing,
issued by the Institute of Chartered Accountants of India, as specified
under Section 143(10) of the Act. Those Standards require that we
comply with ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the consolidated financial statements.
The procedures selected depend on the auditor’s judgment, including
the assessment of the risks of material misstatement of the consolidated
financial statements, whether due to fraud or error. In making those
risk assessments, the auditor considers internal financial control
relevant to the Holding Company’s preparation of the consolidated
financial statements that give a true and fair view in order to design
audit procedures that are appropriate in the circumstances. An audit
also includes evaluating the appropriateness of accounting policies
used and the reasonableness of the accounting estimates made by the
Holding Company’s Board of Directors, as well as evaluating the overall
presentation of the consolidated financial statements. We believe that
the audit evidence obtained by us and the audit evidence obtained by
the other auditors in terms of their reports referred to in sub-paragraph
(a) of the Other Matters paragraph below, is sufficient and appropriate
to provide a basis for our audit opinion on the consolidated financial
statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid consolidated financial statements
give the information required by the Act in the manner so required and give
a true and fair view in conformity with the accounting principles generally
accepted in India, of the consolidated state of affairs of the Group as at 31
March 2018, of their consolidated Profit including Other Comprehensive
Income and their consolidated cash flows and consolidated statement of
changes in equity for the year ended on that date.
Other Matters
(a) We did not audit the financial statements and other financial
information, in respect of Five subsidiaries, whose financial
statements include total assets of ` 1,08,766 Lakhs as at
31 March 2018, and total revenues of ` 30,920 Lakhs and net
cash inflows of ` 590 Lakhs for the year ended on that date. These
financial statements and other financial information have been
audited by other auditors and whose reports have been furnished
to us by the Management. Our opinion on the consolidated financial
statements, in so far as it relates to the amounts and disclosures
included in respect of these subsidiaries, and our report in terms of
sub-Sections (3) of Section 143 of the Act, in so far as it relates to
the aforesaid subsidiaries, is based solely on the report(s) of such
other auditors.
(b) Consolidated financial statements include the total revenue of
` 1 Lakh for the six months period ended 30 September 2017, in
respect of five subsidiaries which have been disposed off during
the year. These financial statements are reviewed unaudited and
have been furnished to us by the Management and our opinion on
the consolidated financial statements, in so far as it relates to the
amounts and disclosures included in respect of these subsidiaries,
and our report in terms of sub-Sections (3) of Section 143 of the
Act in so far as it relates to the aforesaid subsidiaries, is based
solely on such reviewed unaudited financial statements. In our
opinion and according to the information and explanations given to
us by the Management, these financial statements are not material
to the Group.
Our opinion on the consolidated financial statements, and our
report on Other Legal and Regulatory Requirements, is not modified
in respect of the above matters with respect to our reliance on the
work done and the reports of the other auditors and the financial
statements certified by the Management.
(c)
The comparative financial information of the Group for the year
ended 31 March 2017 prepared in accordance with Indian
Accounting Standards, included in these consolidated financial
statements, have been audited by the predecessor auditor. The
report of the predecessor auditor on the comparative financial
information expressed an unmodified opinion.
Report on Other Legal and Regulatory Requirements
1.
As required by Section 143(3) of the Act and based on our
audit and on the consideration of report of the other auditors on
separate financial statements and the other financial information
of subsidiaries, as noted in the ‘other matter’ paragraph, to the
extent applicable, we report that:
(a) We and the other auditors whose reports we have relied
upon, have sought and obtained all the information and
explanations which to the best of our knowledge and belief
EROS IntERnatIOnal MEdIa lIMItEd 127
Corporate overview | ManageMent report | financial management
(b)
(c)
were necessary for the purpose of our audit of the aforesaid
consolidated financial statements;
In our opinion proper books of account as required by
law relating to preparation of the aforesaid consolidated
financial statements have been kept by the Company so far
as appears from our examination of those books and the
reports of the other auditors;
The consolidated Balance Sheet,
the consolidated
Statement of Profit and Loss including the Statement of
Other Comprehensive Income, the consolidated Cash Flow
Statement and the consolidated Statement of Changes in
Equity dealt with by this Report are in agreement with the
books of account maintained for the purpose of preparation
of the consolidated financial statements;
(d)
In our opinion, the aforesaid consolidated financial statements
comply with the Indian Accounting Standards specified
under Section 133 of the Act, read with Companies (Indian
Accounting Standards) Rules, 2015, as amended.
(e) On the basis of the written representations received from
the directors of the Holding Company as on 31 March 2018
taken on record by the Board of Directors of the Holding
Company and the reports of the statutory auditors who are
appointed under Section 139 of the Act, of its subsidiary
companies, incorporated in India, none of the directors of the
Group’s companies, incorporated in India is disqualified as on
31 March 2018 from being appointed as a director in terms
of Section 164 (2) of the Act.
(f) With respect to the adequacy and the operating effectiveness
of the internal financial controls over financial reporting of the
Holding Company and its subsidiary companies, incorporated
in India, refer to our separate report in “Annexure A” to this
report;
(g) With respect to the other matters to be included in the
Auditor’s Report in accordance with Rule 11 of the Companies
(Audit and Auditors) Rules, 2014, in our opinion and to the
best of our information and according to the explanations
given to us and based on the consideration of the report of
the other auditors on separate financial statements as also
the other financial information of the subsidiaries, as noted in
the ‘Other matter’ paragraph:
i.
ii.
iii.
The consolidated financial statements disclose the
impact of pending litigations on its consolidated
financial position of the Group, Refer Note 39 to the
consolidated financial statements;
The Group did not have any material foreseeable
losses on long-term contracts including derivative
contracts during the year ended 31 March 2018; and
There has been no delay in transferring amounts,
required to be transferred, to the Investor Education
and Protection Fund by the Holding Company and
its subsidiaries incorporated in India during the year
ended 31 March 2018.
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No. 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No. 103141
Mumbai
Dated : 23 May 2018
128 annual REpORt 2017-18
Consolidated statements “Annexure A”to Independent Auditors’ Report
Report on the Internal Financial Controls under Clause (i) of Sub-
Section 3 of Section 143 of the Companies Act, 2013 (“the Act”)
We have audited the Internal Financial Control over financial reporting
of Eros International Media Limited (hereinafter referred to as “the
Holding Company”) and its subsidiary companies which are companies
incorporated in India as of 31 March 2018 in conjunction with our audit
of the consolidated financial statements of the Company for the year then
ended.
Management’s Responsibility for Internal Financial Control
The respective Board of Directors of the Holding Company and its
subsidiary companies which are companies incorporated in India, are
responsible for establishing and maintaining internal financial controls
based on the internal control over financial reporting criteria established
by the Company considering the essential components of internal
control stated in the Guidance Note on Audit of Internal Financial
Controls Over Financial Reporting issued by the Institute of Chartered
Accountants of India (ICAI). These responsibilities include the design,
implementation and maintenance of adequate
internal financial
controls that were operating effectively for ensuring the orderly and
efficient conduct of its business, including adherence to the respective
Company’s policies, the safeguarding of its assets, the prevention and
detection of frauds and errors, the accuracy and completeness of the
accounting records, and the timely preparation of reliable financial
information, as required under the Act.
Auditor’s Responsibility
Our responsibility is to express an opinion on the Company's internal
financial controls over financial reporting based on our audit. We
conducted our audit in accordance with the Guidance Note on Audit
of Internal Financial Controls Over Financial Reporting (the “Guidance
Note”) and the Standards on Auditing issued by ICAI and deemed to
be prescribed under Section 143(10) of the Act, to the extent applicable
to an audit of internal financial controls, both issued by the ICAI. Those
Standards and the Guidance Note require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable
assurance about whether adequate internal financial controls over
financial reporting was established and maintained and if such controls
operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about
the adequacy of the internal financial controls system over financial
reporting and their operating effectiveness. Our audit of internal financial
controls over financial reporting included obtaining an understanding of
internal financial controls over financial reporting, assessing the risk that
a material weakness exists, and testing and evaluating the design and
operating effectiveness of internal control based on the assessed risk.
The procedures selected depend on the auditor’s judgement, including
the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error.
We believe that the audit evidence we have obtained and the audit
evidence obtained by the other auditors in terms of their reports referred
to in the Other Matters paragraph below, is sufficient and appropriate to
provide a basis for our audit opinion on the Company’s internal financial
controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A Company's internal financial control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles.
A Company's internal financial control over financial reporting includes
those policies and procedures that (1) pertain to the maintenance
of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the Company; (2) provide
reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of
the Company are being made only in accordance with authorisations of
management and directors of the Company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorised
acquisition, use, or disposition of the Company's assets that could have
a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial
Reporting
Because of the inherent limitations of internal financial controls over
financial reporting, including the possibility of collusion or improper
management override of controls, material misstatements due to error
or fraud may occur and not be detected. Also, projections of any
evaluation of the internal financial controls over financial reporting to
future periods are subject to the risk that the internal financial control
over financial reporting may become inadequate because of changes
in conditions, or that the degree of compliance with the policies or
procedures may deteriorate.
Opinion
In our opinion, the Holding Company and its subsidiary companies which are
companies incorporated in India, have, in all material respects, an adequate
internal financial controls system over financial reporting and such internal
financial controls over financial reporting were operating effectively as at
31 March 2018, based on the internal control over financial reporting
criteria established by
the essential
components of internal control stated in the Guidance Note on Audit of
Internal Financial Controls Over Financial Reporting issued by the ICAI.
the Company considering
Other Matters
Our aforesaid reports under Section 143(3) (i) of the Act on the adequacy
and operating effectiveness of the internal financial controls over financial
reporting insofar as it relates to three subsidiary companies, which are
companies incorporated in India, is based on the corresponding reports
of the auditors of such companies incorporated in India.
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No. 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No. 103141
Mumbai
Dated : 23 May 2018
EROS IntERnatIOnal MEdIa lIMItEd 129
Corporate overview | ManageMent report | financial management Consolidated Balance Sheet
as at 31 March 2018
Assets
Non-current assets
Property, plant & equipment
Intangible assets
a) Content advances
b) Film rights
c) Other intangible assets
d) Intangible assets under development
e) Goodwill
Financial assets
a) Loans
b) Restricted bank deposits
c) Other financial assets
Other non-current assets
Total non-current assets
Current assets
Inventories
Financial assets
a) Investments
b) Trade and other receivables
c) Cash & cash equivalents
d) Restricted bank deposits
e) Loans and advances
f) Other financial assets
Other current assets
Total current assets
Total assets
Equity and Liabilities
Equity
Equity share capital
Other equity
Equity attributable to owners
Non-controlling Interests
Total equity
Liabilities
Non-current liabilities
Financial liabilities
a) Borrowings
b) Trade payables
c) Other financial liabilities
Employee benefit obligations
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities
Current liabilities
Financial liabilities
a) Borrowings
b) Acceptances
c) Trade payables
d) Other financial liabilities
Employee benefit obligations
Current tax liabilities
Other current liabilities
Total current liabilities
Total liabilities
Total equity and liabilities
Significant Accounting Policies and Key Accounting Estimates and Judgements
Notes to the Financial Statements
As per our report of even date
Notes
As at
31 March 2018
Amount ` in lakhs
As at
31 March 2017
2
3
3
3
3
3
4
10
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
1
2-51
4,100
151,234
105,143
1,590
7,079
1,283
11,862
716
789
4,686
288,482
187
0
69,857
14,230
3,776
1,167
302
683
90,202
378,684
9,497
214,803
224,300
1,288
225,588
14,952
102
-
487
24,501
1,512
41,554
46,808
5,796
32,327
9,066
224
3,684
13,637
111,542
153,096
378,684
4,216
141,611
120,370
1,900
2,550
2,060
3,533
217
864
6,159
283,480
46
0
63,058
13,417
4,256
3,013
187
125
84,102
367,582
9,385
191,521
200,906
(466)
200,440
14,940
84
1
450
22,499
3,016
40,990
43,033
5,795
29,542
10,886
218
4,400
32,278
126,152
167,142
367,582
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No.: 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No: 103141
Place: Mumbai
Date : 23 May 2018
130 annual REpORt 2017-18
For and on behalf of Board of Directors
Sd/-
Sunil Arjan Lulla
Executive Vice Chairman and Managing Director
(DIN: 00243191)
Sd/-
Sunil Srivastav
Non Executive Independent Director
(DIN: 00237561)
Sd/-
Farokh P. Gandhi
Chief Financial Officer
Place: Mumbai
Date : 23 May 2018
Sd/-
Abhishekh Kanoi
Vice President - Company Secretary
and Compliance Officer
Consolidated statements Consolidated Statement of Profit and Loss
for the year ended 31 March 2018
Revenue
Revenue from operations
Other income
Total revenue
Expenses
Purchases/operating expenses
Changes in inventories
Employee benefit expenses
Finance costs
Depreciation and amortization expense
Other expenses
Total expenses
Profit before tax
Tax expense
Current tax
Deferred tax
Profit for the year
Other Comprehensive Income
(i) Items that will not be reclassified to profit or loss
Remeasurement gain on definted benfit plan
Income tax effect
(ii) Items that will be reclassified to profit or loss
Exchange differences on translating foreign operations
Total Other Comprehensive Income for the year
Total Comprehensive Income for the year
Net Profit attibutable to :
a) Owners of the Company
b) Non Controlling Interest
Other Comprehensive Income attibutable to :
a) Owners of the Company
b) Non Controlling Interest
Total Comprehensive Income attibutable to :
a) Owners of the Company
b) Non Controlling Interest
Earnings per share of face value of ` 10 each
1. Basic (in `)
2. Diluted (in `)
Significant Accounting Policies and Key Accounting Estimates and Judgements
Notes to the Financial Statements
Notes
Year ended
31 March 2018
Amount ` in lakhs
Year ended
31 March 2017
96,016
4,985
101,001
39,927
(141)
5,894
8,053
1,028
17,505
72,266
28,735
9,717
(4,104)
5,613
23,122
111
(38)
(22)
51
23,173
22,934
188
273
(222)
23,207
(34)
24.26
23.92
139,970
4,558
144,528
78,484
294
7,053
5,452
958
20,064
112,305
32,223
7,699
195
7,894
24,329
-
(8)
(452)
(460)
23,869
25,745
(1,416)
(932)
472
24,813
(944)
27.49
27.00
30
31
32
33
34
35
36
37
21
21
38
38
1
2-51
As per our report of even date
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No.: 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No: 103141
Place: Mumbai
Date : 23 May 2018
For and on behalf of Board of Directors
Sd/-
Sunil Arjan Lulla
Executive Vice Chairman and Managing Director
(DIN: 00243191)
Sd/-
Sunil Srivastav
Non Executive Independent Director
(DIN: 00237561)
Sd/-
Farokh P. Gandhi
Chief Financial Officer
Place: Mumbai
Date : 23 May 2018
Sd/-
Abhishekh Kanoi
Vice President - Company Secretary
and Compliance Officer
EROS IntERnatIOnal MEdIa lIMItEd 131
Corporate overview | ManageMent report | financial management Consolidated Statement of Changes in Equity
As at 31 March 2018
A. Equity share capital
Balance as at 31 March 2016
Add: Issued on exercise of employee share options
Balance as at 31 March 2017
Add: Issued on exercise of employee share options
Balance as at 31 March 2018
Number
93,589,164
269,553
93,858,717
1,113,160
94,971,877
B. Other equity
Particulars
Securities
Premium
Account
Share
Options
Outstanding
Retained
Earnings
Foreign
Currency
Translation
Reserve
Other
comprehensive
income / (loss)
for the year
Total
Other
Reserve
Amount ` in lakhs
9,358
27
9,385
112
9,497
Amount ` in lakhs
Total
Non-
Equity
Controlling
Interest
General
Reserves
and
Capital
Reserve
564
-
-
-
-
-
37,513
-
-
-
628
-
1,775
118,754
6,592
12
165,210
478
165,688
-
-
25,745
-
-
(924)
-
(8)
25,745
(932)
(1,416)
472
24,329
(460)
-
25,745
(924)
(8)
24,813
(944)
23,869
(628)
1,498
-
-
-
-
-
-
-
1,498
-
-
-
1,498
38,141
564
2,645
144,499
5,668
4
191,521
(466)
191,055
-
-
-
-
2,110
247
-
-
-
-
-
-
-
-
-
-
-
-
22,934
-
-
200
-
22,934
(1,214)
(1,014)
(2,110)
-
1,042
-
-
-
-
-
-
-
73
-
73
-
-
-
22,934
273
(1,214)
21,993
-
247
1,042
188
(222)
23,122
51
1,788
1,754
574
23,747
-
-
-
-
247
1,042
40,498
564
1,577
167,433
4,654
77
214,803
1,288
216,091
For and on behalf of Board of Directors
Sd/-
Sunil Arjan Lulla
Executive Vice Chairman and Managing Director
(DIN: 00243191)
Sd/-
Sunil Srivastav
Non Executive Independent Director
(DIN: 00237561)
Sd/-
Farokh P. Gandhi
Chief Financial Officer
Place: Mumbai
Date : 23 May 2018
Sd/-
Abhishekh Kanoi
Vice President - Company Secretary
and Compliance Officer
Balance as of
31 March 2016
Profit for the year
Other comprehensive
income / (loss) for the year
Total Comprehensive
income/ (loss) for the year
Transfer from/to share
option outstanding account
Employee stock option
compensation expense
Balance as of
31 March 2017
Profit for the year
Other comprehensive
income / (loss) for the year
Divestment of subsidiary
Total Comprehensive
income/(loss) for the year
Transfer from/to share
option outstanding account
Employee stock options
exercised during the year
Employee stock option
compensation expense
Balance as at
31 March 2018
As per our report of even date
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No.: 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No: 103141
Place: Mumbai
Date : 23 May 2018
132 annual REpORt 2017-18
Consolidated statements Consolidated Statement of Changes in Equity
As at 31 March 2018
Consolidated Cash Flow Statement
For the year ended 31 March 2018
Cash flow from operating activities
Profit before tax
Non-cash adjustments to reconcile Profit before tax to net cash flows
Depreciation and Other Amortization
Amortization on film rights
Trade receivables written off
Sundry balances written back
Content advances written off
Advances and deposits written off
Provision for doubtful trade receivables
Impact of expected credit loss
Finance costs
Finance income
(Gain)/Loss on sale of tangible assets (net)
Impairment loss on Goodwill
Expense on employee stock option scheme
Unrealised foreign exchange gain
Operating profit before working capital changes
Movements in working capital:
Increase in trade payables
Increase/(Decrease) in other financial liabilities
Increase in Employee benefit obligations
(Decrease) in Other liabilities
Decrease in inventories
Increase in trade receivables
(Increase)/Decrease in short-term loans
Increase in other current assets
(Increase)/Decrease in long-term loans
(Increase)/Decrease in other financial assets
Cash generated from operations
Taxes paid (net)
Net cash generated from operating activities (A)
Cash flow from investing activities
Purchase of tangible assets
Purchase of other intangible assets
Purchase of intangible film rights and related content
Proceeds from fixed deposits with banks
Sale of investment in subsidiaries
Proceeds from sale of fixed assets
Interest received
Net cash used in investing activities (B)
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
28,735
32,223
1,028
28,838
5,541
(98)
228
44
1,652
(2,490)
8,317
(1,127)
(6)
777
1,013
329
72,781
2,340
(1,341)
88
958
44,630
337
(383)
741
294
3,111
(2,246)
5,660
(420)
35
70
1,433
1,367
87,810
4,356
246
162
(10,962)
(41,942)
29
(26,573)
(9,648)
(266)
3,024
(961)
28,511
(4,984)
23,527
(691)
-
(19,713)
68
0
22
923
52
(23,715)
1,995
(27)
(2,713)
306
26,530
(3,015)
23,515
(452)
(13)
(60,426)
10,302
-
1
468
(19,391)
(50,120)
EROS IntERnatIOnal MEdIa lIMItEd 133
Corporate overview | ManageMent report | financial management
Consolidated Cash Flow Statement
For the year ended 31 March 2018
Cash flows from financing activities
Proceeds from issue of equity shares
Repayment of long-term borrowings
Proceeds from long-term borrowings
Proceeds from short-term borrowings
Finance costs
Net cash used in financing activities (C)
Net Increase/(Decrease) in cash and cash equivalents (A + B + C)
Cash and cash equivalents at the beginning of the year
Effect of exhange rate on consolidation of foreign subsidiaries
De-recognition on divestment of subsidiaries
Cash and cash equivalents at the end of the year
Change in liability arising from financing activities :-
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
358
(7,176)
7,272
3,911
(7,663)
(3,298)
838
652
3
(7)
1,486
27
(7,998)
11,074
25,340
(4,625)
23,818
(2,787)
3,342
97
-
652
As on 1 April 2017
Cash Flows
Adjustments
As on 31 March 2018
Non current
borrowings
14,940
96
(84)
14,952
Current borrowing
Acceptances
Total
50,234
3,910
(119)
54,025
5,795
1
-
5,796
70,969
4,007
(203)
74,773
Notes 1 to 51 form an integral part of these consolidated financial statements
As per our report of even date
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No.: 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No: 103141
Place: Mumbai
Date : 23 May 2018
For and on behalf of Board of Directors
Sd/-
Sunil Arjan Lulla
Executive Vice Chairman and Managing Director
(DIN: 00243191)
Sd/-
Sunil Srivastav
Non Executive Independent Director
(DIN: 00237561)
Sd/-
Farokh P. Gandhi
Chief Financial Officer
Place: Mumbai
Date : 23 May 2018
Sd/-
Abhishekh Kanoi
Vice President - Company Secretary
and Compliance Officer
134 annual REpORt 2017-18
Consolidated statements
Summary of Significant Accounting Policies
1. Corporate Information and Significant accounting policies
Corporate Information
Eros International Media Limited (the ‘Company’ or ‘parent’)
was incorporated in India, under the Companies Act, 1956. The
Company and its subsidiaries including step down subsidiaries
(hereinafter collectively referred to as the “Group”) is a global
player within the Indian media and entertainment industry and is
primarily engaged in the business of film production, exploitation
and distribution. It operates on a vertically integrated studio
model controlling content as well as distribution and exploitation
across multiple formats globally, including cinema, digital, home
entertainment and television syndication. Its shares are listed on
leading stock exchanges in India (BSE Scrip Code: 533261; NSE
Scrip Code: EROSMEDIA).
The Group is engaged in the business of sourcing Indian film
content either through acquisition, co-production or production
of such films, and subsequently exploiting and distributing such
films in India through music release, theatrical distribution, DVD
and VCD release, television licensing and new media distribution
avenues such as cable or DTH licensing; and trading and exporting
overseas rights to its parent Eros Worldwide FZ LLC.
These consolidated financial statements were authorised for issue
in accordance with a resolution passed in the Board of Directors
meeting held on 23 May 2018.
Basis of preparation
The consolidated financial statements are prepared in accordance
with Indian Accounting Standards (‘Ind AS’) notified under Section
133 of the Companies Act, 2013 (‘the Act’) read with Companies
(Indian Accounting Standards) Rules, 2015 and relevant provisions
of the Act (as amended from time to time).
The consolidated financial statements have been prepared on
accrual basis of accounting using historical cost basis, except for
the following:
•
•
Employee Stock Option Compensation measured at fair
value (refer accounting policy on ESOP).
Accounting of Business Combinations at fair value (refer
accounting policy on Business Combinations).
All assets and liabilities have been classified as current or non-
current as per the Group’s normal operating cycle and other
criteria set out in the Schedule III to the Act. The Group considers
12 months to be its normal operating cycle.
All values are rounded to the nearest rupees in Lacs, except where
otherwise indicated. Amount in zero (0) represents amount below
One (1) lakh.
Principles of consolidation
The Group consolidates results of the Company and entities
controlled by the Company i.e. its subsidiary undertakings.
Control exists when the Company has existing rights that give the
Company the current ability to direct the activities which affect the
entity’s returns; the Company is exposed to or has rights to a return
which may vary depending on the entity’s performance; and the
Company has the ability to use its powers to affect its own returns
from its involvement with the entity.
Subsidiaries are consolidated by combining like items of assets,
liabilities, equity, income, expenses and cash flows of the parent
with those of its subsidiaries. The intra-company balances and
transactions including unrealized gain / loss from such transactions
are eliminated upon consolidation. These consolidated financial
statements are prepared by applying uniform accounting policies
in use. Non-controlling interests (“NCI”) which represent part of the
net profit or loss and net assets of subsidiaries that are not, directly
or indirectly, owned or controlled by the Group, are excluded.
Changes in the Group’s equity interest in a subsidiary that
do not result in a loss of control are accounted for as equity
transactions.
Business combinations are accounted for under the acquisition
method. The acquisition method involves the recognition at fair
value of all identifiable assets and liabilities, including contingent
liabilities of the subsidiaries, at the acquisition date, regardless of
whether or not they were recorded in the financial statements of
the subsidiary prior to acquisition. On initial recognition, the assets
and liabilities of the subsidiaries are included in the consolidated
balance sheet at their fair values, which are also used as the
bases for subsequent measurement in accordance with the Group
accounting policies. Transaction costs that the Group incurs in
connection with a business combination such as finder’s fees, legal
fees, due diligence fees, and other professional and consulting
fees are expensed as incurred. Goodwill is stated after separating
out identifiable intangible assets. Goodwill represents the excess
of acquisition cost over the fair value of the Group’s share of the
identifiable net assets of the acquired subsidiary at the date of
acquisition.
Changes in controlling interest in a subsidiary that do not result in
gaining or losing control are not business combinations as defined
by Ind AS 103 ‘Business Combinations’. The Group adopts the
“equity transaction method” which regards the transaction as
a realignment of the interests of the different equity holders in
the Group. Under the equity transaction method an increase or
decrease in the Group’s ownership interest is accounted for as
follows:
•
•
•
•
the non-controlling component of equity is adjusted to reflect
the non-controlling interest revised share of the net carrying
value of the subsidiaries net assets;
the difference between the consideration received or paid
and the adjustment to non-controlling interests is debited or
credited to equity;
no adjustment is made to the carrying amount of goodwill or
the subsidiaries’ net assets as reported in the consolidated
financial statements; and
no gain or loss is reported in the Consolidated Statement of
Profit and Loss.
Associates
Associates are all entities over which the Group has significant
influence but not control or joint control. Assessment of whether
the Group has significant influence or not is made based on Ind AS
28 – Associates and joint ventures, which requires duly considering
potential voting rights if any. Investments in associates are accounted
for using the equity method, after initially recognized at cost.
Joint arrangements
Investments in joint arrangements are classified as either joint
operations or joint ventures. The classification depends on the
contractual rights and obligations of each investor, rather than the
legal structure of the joint arrangement. The Group has investments
in joint ventures which are accounted using the equity method
based on requirements of Ind AS 111 – Joint arrangements, after
initially being recognized at cost in the consolidated balance sheet.
Equity method
Under the equity method of accounting, the investments are initially
recognized at cost and adjusted thereafter to recognise the Group’s
EROS IntERnatIOnal MEdIa lIMItEd 135
Corporate overview | ManageMent report | financial management
share of the post-acquisition profits or losses of the investee in
Statement of Profit and Loss, and the Group’s share of Other
Comprehensive Income of the investee in Other Comprehensive
Income.
Any excess/short of the amount of investments in associate or joint
venture over the Group’s portion of in net assets of associate or
joint venture, at the date of investments is considered as goodwill/
capital reserve.
the
reduction
recognized as a
investment. When
Dividends received or receivable from associates and joint
the carrying
ventures are
amount of
the Group’s share of
losses in an equity-accounted investment equals or exceeds
its
including any other unsecured
long-term receivables, the Group does not recognise further
losses, unless it has incurred obligations or made payments on
behalf of the other entity.
the entity,
interest
in
in
Unrealised gains on transactions between the Group and its
associates and joint ventures are eliminated to the extent of
the Group’s interest in these entities. Unrealised losses are
also eliminated unless the transaction provides evidence of an
impairment of the asset transferred.
Accounting policies of joint ventures and associates are similar to
the Group’s accounting policies, therefore, no adjustment is required
for the purposes of preparation of these consolidated financial
statements. The financial statements of joint ventures and associates
are prepared up to the same reporting date as that of the Group i.e.
31 March 2018. The carrying amount of equity accounted
investments are tested for impairment in accordance with the
policy described in accounting policies below.
Significant accounting policies
a. Revenue recognition
Revenue is recognized, net of sales related taxes, when
persuasive evidence of an arrangement exists, the fees are
fixed or determinable, the product is delivered or services
have been rendered and collectability is reasonably assured.
The Group considers the terms of each arrangement to
determine the appropriate accounting treatment.
The following additional criteria apply in respect of various
revenue streams within filmed entertainment:
Theatrical — Contracted minimum guarantees are recognized
on the theatrical release date. The Group’s share of box office
receipts in excess of the minimum guarantee is recognized at
the point they are notified to the Group.
Television — License fees received in advance which do not
meet all the above criteria are included in deferred income
until the above criteria is met.
Other — DVD, CD and video distribution revenue is
recognized on the date the product is delivered or if licensed
in line with the above criteria. Provision is made for physical
returns where applicable. Digital and ancillary media revenues
are recognized at the earlier of when the content is accessed
or declared. Visual effects, production and other fees for
services rendered by the Group and overhead recharges
are recognized in the period in which they are earned and in
certain cases, the stage of production is used to determine
the proportion recognized in the period.
Other income
Dividend income is recognized when the Group’s right to receive
the payment is established, which is generally when shareholders
approve the dividend.
Interest income is recognized on a time proportion basis taking
into account the amount outstanding and the effective interest rate
applicable.
136 annual REpORt 2017-18
b. Property, plant and equipment and depreciation
Property, plant and equipment is stated at cost, net of
accumulated depreciation and accumulated impairment
losses, if any.
The cost of Property, Plant and Equipment comprises of
its purchase price or construction cost, any costs directly
attributable to bringing the asset into the location and
condition necessary for it to be capable of operating in the
manner intended by management, the initial estimate of any
decommissioning obligation, if any, and borrowing costs
for assets that necessarily take a substantial period of time
to get ready for their intended use. Subsequent costs are
included in the asset's carrying amount or recognized as a
separate asset, as appropriate, only when it is probable that
future economic benefits associated with the item will flow to
the Group and the cost of the item can be measured reliably.
Capital Work-in-progress (CWIP) includes expenditure that is
directly attributable to the acquisition/construction of assets,
which are yet to be commissioned.
Depreciation is provided under written down value method at
the rates and in the manner prescribed under Schedule II to
the Companies Act, 2013.
c.
Intangible assets
Intangible assets acquired by the Group are stated at cost
less accumulated amortization less impairment loss, if any,
(film production cost and content advances are transferred
to film and content rights at the point at which content is first
exploited).
Investments in films and associated rights, including acquired
rights and distribution advances in respect of completed
films, are stated at cost less amortization less provision for
impairment. Costs include production costs, overhead and
capitalized interest costs net of any amounts received from
third party investors. A charge is made to write down the
cost of completed rights over the estimated useful lives,
writing off more in year one which recognizes initial income
flows and then the balance over a period of up to nine years,
except where the asset is not yet available for exploitation.
The average life of the assets is the lesser of 10 years or
the remaining life of the content rights. The amortization
charge is recognized in the consolidated Statement of Profit
and Loss within film right costs including amortization costs.
The determination of useful life is based upon Management’s
judgment and includes assumptions on the timing and future
estimated revenues to be generated by these assets.
Intangible assets comprising film scripts and related costs are
stated at cost less amortization less provision for impairment.
The script costs are amortized over a period of 3 years on a
straight-line basis and the amortization charge is recognized
in the consolidated Statement of Profit and Loss within film
right costs including amortization costs. The determination
of useful life is based upon Management’s estimate of the
period over which the Group explores the possibility of
making films using the script.
Other intangible assets, which comprise internally generated
and acquired software used within the Entity’s digital, home
entertainment and internal accounting activities, are stated
at cost less amortization less provision for impairment. A
charge is made to write down the cost of completed rights
over the estimated useful lives except where the asset is not
yet available for exploitation. The average life of the assets
is the lesser of 3 years or the remaining life of the asset.
The amortization charge is recognized in the consolidated
Statement of Profit and Loss within depreciation and
amortization expenses.
Goodwill represents excess of the consideration transferred
in a business combination over the fair value of the Group’s
Consolidated statements
share of the identifiable net assets acquired. Goodwill is
carried at cost less accumulated impairment losses. Gain on
bargain purchase is recognized immediately after acquisition
in the consolidated Statement of Profit and Loss.
Borrowings are classified as current liabilities unless the
Group has an unconditional right to defer settlement of the
liability for at least 12 months after the consolidated balance
sheet date.
d.
Impairment of non-financial assets
f.
Impairment of financial assets
At each reporting date, for the purposes of assessing
impairment, assets are grouped at the lowest levels for which
there are separately identifiable cash flows (cash generating
units). As a result, some assets are tested individually for
impairment and some are tested at the cash generating unit
level. Goodwill is allocated to those cash generating units that
are expected to benefit from synergies of the related business
combination and represent the lowest level within the Group
at which management monitors the related cash flows.
Goodwill is tested for impairment at least annually. All other
individual assets or cash generating units are tested for
impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable.
An impairment loss is recognized wherever the carrying
amount of an asset exceeds its recoverable amount which
represents the greater of the net selling price of assets and
their ‘value in use’. Impairment losses recognized for cash-
generating units, to which goodwill has been allocated, are
credited initially to the carrying amount of goodwill. Any
remaining impairment loss is charged pro rata to the other
assets in the cash generating unit.
In assessing value in use, the estimated future cash flows are
discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of
money and the risks specific to the asset. In determining fair
value less costs of disposal, recent market transactions are
taken into account. If no such transactions can be identified,
an appropriate valuation model is used. These calculations are
corroborated by valuation multiples, quoted share prices for
publicly traded companies or other available fair value indicators.
Film and content rights are stated at the lower of unamortized
cost and estimated recoverable amounts. In accordance
with Ind AS 36 ‘Impairment of Assets’, film content costs are
assessed for indication of impairment on a library basis as the
nature of the Group’s business, the contracts it has in place
and the markets it operates in, do not yet make an ongoing
individual film evaluation feasible with reasonable certainty.
Impairment losses on content advances are recognized
when film production does not seem viable and refund of the
advance is not probable.
With the exception of goodwill, all assets are subsequently
reassessed
loss
previously recognized may no longer exist.
impairment
indications
that an
for
e. Borrowing costs
The Group is capitalising borrowing costs that are directly
attributable to the acquisition or construction of qualifying
assets. Qualifying assets are assets that necessarily take a
substantial period of time to get ready for their intended use
or sale.
Borrowings are recognized initially at fair value, net of
transaction costs incurred. Borrowings are subsequently
stated at amortized cost with any difference between the
proceeds (net of transaction costs) and the redemption value
recognized in the consolidated Statement of Profit and Loss
within Finance costs over the period of the borrowings using
the effective interest method. Finance costs in respect of
film productions and other assets which take a substantial
period of time to get ready for use or for exploitation are
capitalized as part of the assets. All other borrowing costs
are recognized as expense in the period in which they are
incurred and charged to the Consolidated Statement of Profit
and Loss.
In accordance with Ind AS 109, the Group applies expected
credit loss (ECL) model for measurement and recognition of
impairment loss on risk exposure arising from financial assets
like debt instruments measured at amortised cost e.g., trade
receivables and deposits.
The Group follows ‘simplified approach’ for recognition of
impairment loss allowance on trade receivables or contract
revenue receivables. The application of simplified approach
does not require the Group to track changes in credit risk.
Rather, it recognises impairment loss allowance based on
lifetime ECLs at each reporting date, right from its initial
recognition.
For recognition of impairment loss on other financial assets
and risk exposure, the Group determines that whether there
has been a significant increase in the credit risk since initial
recognition. If credit risk has not increased significantly,
12-month ECL is used to provide for impairment loss.
However, if credit risk has increased significantly, lifetime
ECL is used. If, in a subsequent period, credit quality of the
instrument improves such that there is no longer a significant
increase in credit risk since initial recognition, then the entity
reverts to recognising impairment loss allowance based on
12-month ECL.
Lifetime ECL are the expected credit losses resulting from all
possible default events over the expected life of a financial
instrument. The 12-month ECL is a portion of the lifetime
ECL which results from default events that are possible within
12 months after the reporting date.
ECL is the difference between all contractual cash flows
that are due to the Group in accordance with the contract
and all the cash flows that the entity expects to receive (i.e.,
all cash shortfalls), discounted at the original EIR. When
estimating the cash flows, an entity is required to consider
all contractual terms of the financial instrument (including
prepayment, extension, call and similar options) over the
expected life of the financial instrument. However, in rare
cases when the expected life of the financial instrument
cannot be estimated reliably, then the entity is required to use
the remaining contractual term of the financial instrument.
ECL impairment loss allowance (or reversal) recognized
during the period is recognized as income/ expense in the
consolidated Statement of Profit and Loss. This amount is
reflected under the head ‘other income’ or ‘other expenses’
in the consolidated Statement of Profit and Loss.
For assessing increase in credit risk and impairment loss, the
Group combines financial instruments on the basis of shared
credit risk characteristics with the objective of facilitating an
analysis that is designed to enable significant increases in
credit risk to be identified on a timely basis.
g.
Inventories
Inventories primarily comprise of music CDs and DVDs,
and are valued at the lower of cost and net realizable value.
Cost in respect of goods for resale is defined as all costs
of purchase, costs of conversion and other costs incurred
in bringing the inventories to their present location and
condition. Cost in respect of raw materials is purchase price.
Purchase price is assigned using a weighted average
basis. Net realisable value is the estimated selling price in
the ordinary course of business less the estimated costs of
completion and the estimated costs necessary to make the
sale.
EROS IntERnatIOnal MEdIa lIMItEd 137
Corporate overview | ManageMent report | financial management
h. Provisions, Contingent Liabilities and Contingent
Assets
Provisions are recognized when the Group has a present
legal or constructive obligation as a result of a past event,
it is more likely than not that an outflow of resources will
be required to settle the obligations and can be reliably
measured. Provisions are measured at management’s best
estimate of the expenditure required to settle the obligations
at the consolidated balance sheet date. If the effect of the
time value of money is material, provisions are discounted
using a current pre-tax rate that reflects, when appropriate,
the risks specific to the liability. When discounting is used,
the increase in the provision due to the passage of time is
recognized as a finance cost.
Contingent liabilities are not recognized in the consolidated
financial statements but are disclosed by way of notes to
accounts unless the possibility of an outflow of economic
resources is considered remote.
Contingent assets are not recognized in financial statements.
However, the same is disclosed, where an inflow of economic
benefit is probable.
i.
Employee benefits
Short term employee benefits obligations
Short-term employee benefits are recognized as an expense
in the consolidated Statement of Profit and Loss for the year in
which related services are rendered.
Post-employment benefits and other
employee benefits
long
term
Defined contribution plan
Provident fund and National Pension scheme: The Group’s
contributions paid or payable during the year to the provident
fund, employee’s state insurance corporation and National
pension scheme are recognized
the consolidated
Statement of Profit and Loss. This fund is administered by
the respective Government authorities, and the Group has
no further obligation beyond making its contribution, which is
expensed in the year to which it pertains.
in
Defined benefit plan
Gratuity: The Group’s liability towards gratuity is determined
using the projected unit credit method which considers each
period of service as giving rise to an additional unit of benefit
entitlement and measures each unit separately to build up
the final obligation. The cost for past services is recognized
on a straight-line basis over the average period until the
amended benefits become vested. Re-measurement
gains and losses are recognized immediately in the Other
Comprehensive Income as income or expense and are not
reclassified to the consolidated Statement of Profit and Loss
in subsequent periods. Obligation is measured at the present
value of estimated future cash flows using a discounted
rate that is determined by reference to market yields at the
consolidated balance sheet date on government bonds
where the currency and terms of the government bonds
are consistent with the currency and estimated terms of the
defined benefit obligation.
compensated
absences: Accumulated
Compensated
absences are expected to be availed or encashed within 12
months from the end of the year and are treated as short-
term employee benefits. The obligation towards the same is
measured at the expected cost of accumulating compensated
absences as the additional amount expected to be paid as a
result of the unused entitlement as at the year end.
Employee stock option plan
In accordance with Ind AS 102 ‘Share Based Payments’,
the fair value of shares or options granted is recognized as
138 annual REpORt 2017-18
personnel costs with a corresponding increase in equity. The
fair value is measured at the grant date and spread over the
period during which the recipient becomes unconditionally
entitled to payment unless forfeited or surrendered.
The fair value of share options granted is measured using
the Black Scholes model, each taking into account the
terms and conditions upon which the grants are made. At
each consolidated balance sheet date, the Group revises its
estimate of the number of equity instruments expected to
vest as a result of non-market based vesting conditions. The
amount recognized as an expense is adjusted to reflect the
revised estimate of the number of equity instruments that
are expected to become exercisable, with a corresponding
adjustment to equity. The Group's share option plan does
not feature any cash settlement option.
Upon exercise of share options, the proceeds received
net of any directly attributable transaction costs up to the
nominal value of the shares are allocated to equity with any
excess being recorded as securities premium.
j.
Leases
The determination of whether an arrangement is (or contains)
a lease is based on the substance of the arrangement at the
inception of the lease. The arrangement is, or contains, a
lease if fulfillment of the arrangement is dependent on the use
of a specific asset or assets and the arrangement conveys
a right to use the asset or assets, even if that right is not
explicitly specified in an arrangement.
A lease is classified at the inception date as a finance lease
or an operating lease. Leases in which significantly all the
risks and rewards incidental to ownership are transferred to
the lessee are classified as finance leases. All other leases
are operating leases. Payments under operating leases are
charged to the consolidated Statement of Profit and Loss on
a straight-line basis over the period of the lease.
As a lessee
Finance lease
Leases are classified as finance leases (including those for
land), if substantially all the risks and rewards incidental to
ownership of the leased asset is transferred to the lessee.
At the commencement of the lease term, the Group
recognises finance leases as assets and liabilities in its
consolidated balance sheet at amounts equal to the fair value
of the leased property or, if lower, the present value of the
minimum lease payments, each determined at the inception
of the lease. The corresponding rental obligations, net of
finance charges, are included in borrowings or other financial
liabilities as appropriate. Any indirect costs of the Group are
added to the amount recognized as an asset.
Minimum lease payments are apportioned between the
finance charge and the reduction of the outstanding liability.
The finance cost is charged to the profit or loss over the lease
period so as to produce a constant periodic rate of interest
on the remaining balance of the liability for each period.
Operating lease
Leases (including those for land) which are not classified
as finance leases are considered as operating lease. Lease
payments under an operating lease are recognized as an
expense on a straight-line basis over the lease term unless
either:
A.
B.
another systematic basis is more representative of the
time pattern of the user’s benefit even if the payments to
the lessors are not on that basis; or
the payments to the lessor are structured to increase
in line with expected general inflation to compensate
for the lessor’s expected inflationary cost increases. If
Consolidated statements
payments to the lessor vary because of factors other
than general inflation, then this condition is not met.
l.
Financial instrument
Non-derivative financial instruments
As a lessor
Finance lease
All assets given on finance lease are shown as receivables
at an amount equal to net investment in the lease. Principal
component of the lease receipts are adjusted against
outstanding receivables and interest income is accounted
by applying the interest rate implicit in the lease to the net
investment.
Operating lease
Lease income from operating lease (excluding amount for
services such as insurance and maintenance) is recognized
in the consolidated Statement of Profit and Loss on a
straight-line basis over the lease term, unless either:
A.
B.
Another systematic basis is more representative of the
time pattern of the user’s benefit even if the payments
to the Group are not on that basis; or
The payments to the Group are structured to increase
in line with expected general inflation to compensate
for the Group’s expected inflationary cost increases. If
payments to the Group vary because of factors other
than general inflation, then this condition is not met.
k.
Foreign currency transactions
Transactions in foreign currencies are translated at the rates
of exchange prevailing on the dates of the transactions.
Monetary assets and liabilities in foreign currencies are
translated at the prevailing rates of exchange at the
consolidated balance sheet date. Non-monetary items that
are measured at historical cost in a foreign currency are
translated at the exchange rate at the date of the transaction.
Non-monetary items that are measured at fair value in a
foreign currency are translated using the exchange rates at
the date when the fair value was determined.
Any exchange differences arising on the settlement of
monetary items or on translating monetary items at rates
different from those at which they were initially recorded
are recognized in the consolidated Statement of Profit
and Loss in the period in which they arise. Non-monetary
items carried at fair value that are denominated in foreign
currencies are translated at rates prevailing at the date
when the fair value was determined. Non-monetary items
that are measured in terms of historical cost in a foreign
currency are not retranslated.
The assets and liabilities in the financial statements of foreign
subsidiaries are translated at the prevailing rate of exchange
at the consolidated balance sheet date. Income and
expenses are translated at the annual average exchange rate.
The exchange differences arising from the retranslation of the
foreign operations are recognized in Other Comprehensive
Income and taken to the “currency translation reserve” in
equity.
On disposal of a foreign operation the cumulative translation
differences (including, if applicable, gains and losses on related
hedges) are transferred to the Consolidated Statement of
Profit and Loss as part of the gain or loss on disposal.
Items included in the Consolidated financial statements
of each of the Group’s entities are measured using the
currency of the primary economic environment in which the
entity operates (‘the functional currency’). The Consolidated
financial statements are presented in Indian Rupee (`) which
is Company’s functional and presentation currency.
Financial assets and financial liabilities are recognized when
the Group becomes party to the contractual provisions of the
instrument.
Financial assets and liabilities are initially measured at fair
value. Transaction costs that are directly attributable to the
acquisition or issue of financial assets or liabilities (other than
financial assets and liabilities at fair value through Statement
of Profit and Loss) are added to or deducted from the
fair value of the financial assets or financial liabilities, as
appropriate, on initial recognition. Transaction costs directly
attributable to the acquisition of financial assets or financial
liabilities at fair value through Statement of Profit and Loss
are recognized immediately in the consolidated Statement of
Profit and Loss. Financial assets and financial liabilities are
offset against each other and the net amount reported in the
consolidated balance sheet if, and only if, there is a currently
enforceable legal right to offset the recognized amounts and
there is an intention to settle on a net basis, or to realize the
assets and settle the liabilities simultaneously.
A financial instrument is measured at fair value through profit
or loss if:
•
•
•
it has been acquired principally for the purpose of
selling/repurchasing it in the near term;
on initial recognition it is part of a portfolio of identified
financial instruments that the Group manages together
and has a recent pattern of short term profit taking; or
it is a derivative that is not designated in a hedging
relationship.
The fair value of financial instruments denominated in a
foreign currency is determined in that foreign currency and
translated at the spot rate at the end of the reporting period.
The foreign exchange component forms part of its fair value
gain or loss. Therefore for financial instruments that are
classified as fair value through Statement of Profit and Loss,
the exchange component is recognized in Statement of Profit
and Loss.
Financial Assets
Financial assets are divided into the following categories:
•
•
•
financial assets carried at amortised cost
financial assets at
Comprehensive Income
fair value
through Other
financial assets at fair value through Statement Profit and
Loss;
Financial assets are assigned to the different categories
by management on initial recognition, depending on the
nature and purpose of the financial assets. The designation
of financial assets is re-evaluated at every reporting date at
which a choice of classification or accounting treatment is
available.
Financial assets carried at amortised cost
A financial asset is subsequently measured at amortised
cost if it is held within a business model whose objective
is to hold the asset in order to collect contractual cash
flows and the contractual terms of the financial asset
give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount
outstanding. These are non-derivative financial assets that
are not quoted in an active market. Loans and receivables
(including trade and other receivables, bank and cash
EROS IntERnatIOnal MEdIa lIMItEd 139
Corporate overview | ManageMent report | financial management
balances) are measured subsequent to initial recognition
at amortized cost using the effective interest method, less
provision for impairment. Any change in their value through
impairment or reversal of impairment is recognized in the
consolidated Statement of Profit and Loss.
In accordance with Ind AS 109 “Financial Instruments”,
the Group recognizes impairment loss allowance on trade
receivables and content advances based on historically
observed default
loss allowance
recognized during the year is charged to consolidated
Statement of Profit and Loss.
Impairment
rates.
Financial assets at
Comprehensive Income
fair value
through Other
Financial assets at fair value through Other Comprehensive
Income are non-derivative financial assets held within a
business model whose objective is achieved by both collecting
contractual cash flows and selling financial assets and the
contractual terms of the financial asset give rise on specified
dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding.
Financial assets at fair value through profit or loss
A financial asset which is not classified in any of the above
categories are subsequently fair valued through profit or
loss. It includes non-derivative financial assets that are either
designated as such or do not qualify for inclusion in any of
the other categories of financial assets. Gains and losses
arising from investments classified under this category is
recognized in the consolidated Statement of Profit and Loss
when they are sold or when the investment is impaired.
In the case of impairment, any loss previously recognized
in Other Comprehensive Income is transferred to the
consolidated Statement of Profit and Loss. Impairment
losses recognized in the consolidated Statement of Profit
and Loss on equity instruments are not reversed through
the consolidated Statement of Profit and Loss. Impairment
losses recognized previously on debt securities are reversed
through the consolidated Statement of Profit and Loss when
the increase can be related objectively to an event occurring
after the impairment loss was recognized in the consolidated
Statement of Profit and Loss.
When the Group considers that fair value of financial
assets can be reliably measured, the fair values of financial
instruments that are not traded in an active market are
determined by using valuation techniques. The Group
applies its judgment to select a variety of methods and make
assumptions that are mainly based on market conditions
existing at each consolidated balance sheet date. Equity
instruments measured at fair value through profit or loss that
do not have a quoted price in an active market and whose
fair value cannot be reliably measured are measured at cost
less impairment at the end of each reporting period.
An assessment for impairment is undertaken at least at each
consolidated balance sheet date.
A financial asset is derecognized only where the contractual
rights to the cash flows from the asset expire or the
financial asset is transferred and that transfer qualifies
for derecognition. A financial asset is transferred if the
contractual rights to receive the cash flows of the asset
have been transferred or the Group retains the contractual
rights to receive the cash flows of the asset but assumes a
contractual obligation to pay the cash flows to one or more
recipients. A financial asset that is transferred qualifies for
derecognition if the Group transfers substantially all the risks
and rewards of ownership of the asset, or if the Group neither
retains nor transfers substantially all the risks and rewards of
ownership but does transfer control of that asset.
140 annual REpORt 2017-18
Financial liabilities
Financial liabilities are classified as either ‘financial liabilities at
fair value through profit or loss’ or ‘other financial liabilities’.
Financial liabilities are subsequently measured at amortised
cost using the effective interest method or at fair value
through profit or loss.
Financial liabilities are classified as at fair value through profit
or loss when the financial liability is held for trading such as
a derivative, except for a designated and effective hedging
instrument, or if upon initial recognition it is thus designated to
eliminate or significantly reduce measurement or recognition
inconsistency or it forms part of a contract containing one or
more embedded derivatives and the contract is designated
as fair value through profit or loss.
Financial liabilities at fair value through profit or loss are stated
at fair value. Any gains or losses arising of held for trading
financial liabilities are recognized in profit or loss. Such gains
or losses incorporate any interest paid and are included in the
“other gains and losses” line item.
Other financial liabilities (including borrowing and trade and
other payables) are subsequently measured at amortized
cost using the effective interest method.
The effective interest method is a method of calculating
the amortized cost of a financial liability and of allocating
interest expense over the relevant period. The effective
interest rate is the rate that exactly discounts estimated
future cash payments (including all fees and points paid or
received that form an integral part of the effective interest
rate, transaction costs and other premiums or discounts)
through the expected life of the financial liability, or (where
appropriate) a shorter period, to the net carrying amount on
initial recognition.
A financial liability is derecognized only when the obligation
is extinguished, that is, when the obligation is discharged or
cancelled or expires. Changes in fair value of liabilities are
included in the consolidated Statement of Profit and Loss.
m. Taxes
Taxation on profit and loss comprises current tax and
deferred tax. Tax is recognized in the consolidated
Statement of Profit and Loss except to the extent that
it relates to items recognized directly in equity or Other
Comprehensive Income in which case tax impact is also
recognized in equity or Other Comprehensive Income.
Current tax is provided at amounts expected to be paid
(or recovered) using the tax rates and laws that have been
enacted or substantively enacted at the consolidated balance
sheet date along with any adjustment relating to tax payable
in previous years.
Deferred income tax is provided in full, using the liability
method, on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in
the consolidated financial statements. Deferred income tax
is provided at amounts expected to be paid (or recovered)
using the tax rates and laws that have been enacted or
substantively enacted at the consolidated balance sheet
date and are expected to apply when the related deferred
income tax asset is realized or the deferred income tax
liability is settled in the appropriate territory.
Deferred tax assets and deferred tax liabilities are offset when
there is a legally enforceable right to set off assets against
liabilities representing current tax and where the deferred
tax assets and the deferred tax liabilities relate to taxes on
income levied by the same governing taxation authority on
either the same taxable entity or different taxable entities
which intend either to settle current tax liabilities and assets
on a net basis, or to realise the assets and settle the liabilities
Consolidated statements
simultaneously, in each future period in which significant
amounts of deferred tax liabilities or assets are expected to
be settled or recovered.
Deferred tax
in respect of undistributed earnings of
subsidiaries is recognized except where the Group is
able to control the timing of the reversal of the temporary
difference and the temporary difference will not reverse
in the foreseeable future. Deferred income tax assets are
recognized to the extent that it is probable that future taxable
profit will be available against which temporary differences
can be utilized.
Minimum alternate tax (MAT) paid in a year is charged to
the Consolidated Statement of Profit and Loss as current
tax. MAT credit entitlement is recognized as an asset only
when and to the extent there is convincing evidence that the
Group will pay normal income tax during the specified period,
which is the period for which MAT credit is allowed to be
carried forward. Such asset is reviewed at each consolidated
balance sheet date and the carrying amount of the MAT
credit asset is written down to the extent there is no longer
a convincing evidence to the effect that the Group will pay
normal income tax during the specified period.
The carrying amount of deferred tax assets is reviewed at each
reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to utilize
all or part of the deferred tax asset. Unrecognized deferred
tax assets are re-assessed at each reporting date and are
recognized to the extent that it has become probable that future
taxable profits will available to utilized the deferred tax asset.
n.
Earnings per share (EPS)
Basic EPS is computed by dividing net profit after taxes for the
year by weighted average number of equity shares outstanding
during the financial year, adjusted for bonus share elements in
equity shares issued during the year and excluding treasure
shares, if any.
Diluted earnings per share adjusts the figures used in the
determination of basic earnings per share to take into account
the after income tax effect of interest and other financing
costs associated with dilutive potential equity shares and the
weighted average number of additional equity shares that
would have been outstanding assuming the conversion of all
dilutive potential equity shares.
o. Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held
at call with banks, other short term highly liquid investments
which are readily convertible into known amounts of cash
and are subject to insignificant risk of changes in value. Bank
overdrafts are shown within borrowings in current liabilities
on the consolidated balance sheet. Deposits held with banks
as security for overdraft facilities are included in restricted
deposits held with bank.
p.
Segment reporting
Ind-AS 108 “Operating Segments” requires operating
segments to be identified on the same basis as is used
internally for the review of performance and allocation of
resources by the Chief Operating Decision Maker. The
revenues of films are earned over various formats; all such
formats are functional activities of filmed entertainment
and these activities take place on an integrated basis. The
management team reviews the financial information on an
integrated basis for the Group as a whole with respective
heads of business for each region and in accordance
with Ind-AS 108, the Group provides a geographical split
as it considers that all activities fall within one segment of
business which is filmed entertainment. The management
team also monitors performance separately for individual
films or for at least 12 months after the theatrical release.
The Group has identified three geographic markets: India,
United Arab Emirates and Rest of the world.
q.
Statement of cash flows
Cash flows are reported using the indirect method, whereby
profit before tax is adjusted for the effects of transactions of
a non-cash nature, any deferrals or accruals of past or future
operating cash receipts or payments and item of income or
expenses associated with investing or financing cash flows.
The cash flows from operating, investing and financing
activities of the Group are segregated.
In line with the amendments to Ind AS 7 Statement of
Cash flows (effective from 1 April 2017), the Group has
provided disclosures that enable users of the consolidated
financial statements to evaluate changes in liabilities arising
from financing activities, including both changes arising
from cash flows and non-cash changes. The adoption
of amendment did not have any material impact on the
consolidated financial statements.
r.
Dividends
The Group recognises a liability for dividends to equity
holders of the Company when the dividend is authorized and
the dividend is no longer at the discretion of the Company. As
per the corporate laws in India, a dividend is authorised when
it is approved by the shareholders. A corresponding amount
is recognized directly in equity.
s.
Event occurring after the reporting date
Adjusting events (that provides evidence of condition that
existed at the consolidated balance sheet date) occurring
after the consolidated balance sheet date are recognized in
the consolidated financial statements. Material non adjusting
events (that are inductive of conditions that arose subsequent
to the consolidated balance sheet date) occurring after the
consolidated balance sheet date that represents material
change and commitment affecting the financial position are
disclosed in the Directors’ Report.
t.
Standards Issued but not yet Effective
Following are the new standards and amendments to existing
standards (as notified by Ministry of Corporate Affairs (MCA)
on 28 March 2018) which are effective for annual periods
beginning after 1 April 2018. The Group intends to adopt
these standards or amendments from the effective date.
Ind AS 115 Revenue from contract with customers
Ind AS 115 establishes a comprehensive framework for
determining whether, how much and when revenue is
recognized. It replaces existing revenue recognition guidance,
including Ind AS 18 Revenue and Ind AS 11 Construction
Contracts. The core principle of the new standard that an
entity should recognize revenue to depict the transfer of
promised goods or services to customers in an amount that
reflects the consideration to which the entity expects to be
entitled in exchange for those goods or services. Further,
the new standard requires enhanced disclosures about the
nature, amount, timing and uncertainty of revenue and cash
flows arising from the entity’s contracts with customers. This
Standard permits two possible methods of transition i.e.
retrospective approach and modified retrospective method.
Based on the preliminary assessment, the Group does not
expect any significant impacts on transition to Ind AS 115.
This assessment is based on currently available information
and may be subject to changes arising from further
reasonable and supportable information when the standard
will be adopted. The quantitative impacts would be finalized
based on a detailed assessment which has been initiated to
identify the key impacts along with evaluation of appropriate
transition options to be considered.
EROS IntERnatIOnal MEdIa lIMItEd 141
Corporate overview | ManageMent report | financial management
Amendments to existing Ind AS
The following amended standards are not expected to have
a significant impact on the Group’s consolidated financial
statements. This assessment is based on currently available
information and may be subject to changes arising from
further reasonable and supportable information being made
available to the Group when it will adopt the respective
standards.
Ind AS 40 - Investment Property – The amendment lays
down the principle regarding the transfer of asset to, or from,
investment property.
Ind AS 21 - The Effects of Changes in Foreign Exchange
Rates – The amendment lays down principles to determine
the date of transaction when a Group recognizes a non-
monetary prepayment asset or deferred income liability.
Ind AS 12 – Income Taxes – The amendments explains that
determining temporary differences and estimating probable
future taxable profit against which deductible temporary
differences are assessed for utilization are two separate
steps.
Ind AS 28 – Investments in associates and joint ventures – The
amendments clarifies that a venture capital organization or a
mutual fund or similar entities may elect, at initial recognition, to
measure investments in associate or joint venture at fair value
through profit or loss separately for each associate or joint
venture.
Ind AS 112 – Disclosure of interest in other entities – The
amendments clarifies that disclosure requirements also
apply to interests that are classified as held for sale or as
discontinued operations in accordance with Ind AS 105 –
Non-current assets held for sale and discontinued operations.
Significant accounting judgements, estimates and
assumptions
The preparation of the consolidated financial statements
requires management to make judgements, estimates
and assumptions, as described below, that affect the
reported amounts and the disclosures. The Group based
its assumptions and estimates on parameters available
when the consolidated financial statements were prepared
and reviewed at each consolidated balance sheet date.
Uncertainty about these assumptions and estimates could
result in outcomes that may require a material adjustment to
the reported amounts and disclosures.
a.
Intangible assets
The Group is required to identify and assess the useful life of
intangible assets and determine their income generating life.
Judgment is required in determining this and then providing
an amortization rate to match this life as well as considering
the recoverability or conversion of advances made in respect
of securing film content or the services of talent associated
with film production.
Accounting for the film content requires management’s
judgment as it relates to total revenues to be received and
costs to be incurred throughout the life of each film or its
license period, whichever is the shorter. These judgments are
used to determine the amortization of capitalized film content
costs. The Group uses a stepped method of amortization on
first release film content writing off more in year one which
recognizes initial income flows and then the balance over a
period of up to nine years. In the case of film content that is
acquired by the Group after its initial exploitation, commonly
referred to as Library, amortization is spread evenly over the
lesser of 10 years or the license period. Management’s policy
is based upon factors such as historical performance of
similar films, the star power of the lead actors and actresses
and others. Management regularly reviews, and revises when
necessary, its estimates, which may result in a change in the
rate of amortization and/or a write down of the asset to the
recoverable amount.
The Group tests annually whether intangible assets including
goodwill have suffered any impairment, in accordance with
the accounting policy. These calculations require judgments
and estimates to be made, and in the event of an unforeseen
event these judgments and assumptions would need to
be revised and the value of the intangible assets could be
affected. There may be instances where the useful life of an
asset is shortened to reflect the uncertainty of its estimated
income generating life.
b.
Employee benefit plans
The cost of the employment benefit plans and their present
value are determined using actuarial valuations which
involves making various assumptions that may differ from
actual developments in the future.
c.
Fair value measurement of Employee shares based
compensation plan
The fair value of ESOP liability is determined using valuation
methods which involves making various assumptions that
may differ from actual developments in the future.
d.
Impairment of non-financial assets
impairment, management estimates
In assessing
the
recoverable amount of each asset or cash-generating unit
based on expected future cash flows and uses an interest
rate to discount them. Estimation uncertainty relates
to assumptions about future operating results and the
determination of a suitable discount rate.
e.
Provisions
Provisions and liabilities are recognized in the period when
it becomes probable that there will be a future outflow of
funds resulting from past operations or events and the
amount of cash outflow can be reliably estimated. The timing
of recognition and quantification of the liability require the
application of judgment to existing facts and circumstances,
which can be subject to change. Since the cash outflows can
take place many years in the future, the carrying amounts of
provisions and liabilities are reviewed regularly and adjusted
to take account of changing facts and circumstances.
f.
Fair value measurement
Management uses valuation techniques to determine the fair
value of financial instruments (where active market quotes
are not available) and non-financial assets. This involves
developing estimates and assumptions consistent with how
market participants would price the instrument. Management
bases its assumptions on observable data as far as possible
but this is not always available. In that case management uses
the best information available. Estimated fair values may vary
from the actual prices that would be achieved in an arm’s length
transaction at the reporting date.
142 annual REpORt 2017-18
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
2
Property, plant and equipment
Details of the Company’s property, plant and equipment and their carrying amounts are as follows:
Amount ` in lakhs
Gross carrying amount
Buildings
Leasehold
improvements
Furniture
and
fixtures
Motor
vehicles
Office
equipment
Data
processing
equipment
Studio
equipment
Total
Balance as at 1 April 2016
4,108
-
753
693
Additions
Adjustments/ disposals
Foreign currency translation difference
-
-
-
Balance as at 31 March 2017
4,108
Additions
Adjustments/ disposals
Foreign currency translation difference
-
-
-
258
-
-
258
253
-
-
119
(77)
(1)
794
13
(53)
(1)
175
(11)
-
857
272
(292)
-
352
121
(76)
(10)
387
26
(79)
(5)
1,787
1,631
9,324
176
(327)
(1)
-
-
-
849
(491)
(12)
1,635
1,631
9,670
81
(54)
(1)
-
645
(10)
(488)
-
(7)
Balance as at 31 March 2018
4,108
511
753
837
329
1,661
1,621
9,820
Accumulated depreciation
Balance as at 1 April 2016
Depreciation charge
Adjustments/ disposals
Foreign currency translation difference
Balance as at 31 March 2017
Depreciation charge
Adjustments/ disposals
Foreign currency translation difference
952
153
-
-
1,105
146
-
-
-
33
-
-
33
178
-
-
623
62
(59)
(1)
625
54
(50)
(1)
430
111
(11)
-
530
112
(261)
-
302
46
(68)
(11)
269
61
(79)
(5)
1,557
1,430
5,294
173
(317)
(1)
63
641
-
-
(455)
(13)
1,412
1,493
5,467
125
(52)
-
42
(9)
-
718
(451)
(6)
Balance as at 31 March 2018
1,251
211
628
381
246
1,485
1,526
5,728
Net carrying amount
Capital-work-in progress 31 March 2017
Capital-work-in progress 31 March 2018
13
8
Balance as at 31 March 2017
Balance as at 31 March 2018
3,003
2,857
225
300
169
125
327
456
118
83
223
176
138
4,216
95
4,100
The Company's immovable property situated in Mumbai, India is pledged against the borrowings as explained in note 17 and 23.
3.
a) Intangible assets
Details of the Group's Intangible assets and their carrying amounts are as follows:
Amount ` in lakhs
Film rights
Other intangible
assets
Gross carrying amount
Balance as at 1 April 2016
Additions
Adjustments/ Deletion
Amount written off
Foreign currency translation difference
Balance as at 31 March 2017
Additions
Adjustments/ Deletion
Amount written off
Foreign currency translation difference
Balance as at 31 March 2018
Content
advances
130,448
81,222
(69,327)
(732)
-
141,611
34,863
(25,549)
228
81
151,234
474,701
47,457
(3,962)
-
(5,706)
512,490
20,550
(53,487)
-
2,206
481,759
Total
477,355
47,470
(3,962)
-
(5,708)
515,155
20,550
(53,487)
-
2,206
2,654
13
-
-
(2)
2,665
-
-
-
-
2,665
484,424
EROS IntERnatIOnal MEdIa lIMItEd 143
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Notes
to the consolidated financial statements and other explanatory information
Accumulated amortization
Balance as at 1 April 2016
Amortization charge
Foreign currency translation difference
Balance as at 31 March 2017
Amortization charge
Adjustments/ Deletion
Foreign currency translation difference
Balance as at 31 March 2018
Net carrying amount
Balance as at 31 March 2017
Balance as at 31 March 2018
Intangible assets under development
Balance as at 31 March 2017
Balance as at 31 March 2018
3
b) Goodwill on consolidation
Content
advances
Film rights
Other intangible
assets
352,596
44,630
(5,106)
392,120
28,838
(50,409)
6,067
376,616
448
317
-
765
310
-
-
1,075
Film rights
Other intangible
assets
120,370
105,143
1,900
1,590
-
-
-
-
-
-
-
Content
advances
141,611
151,234
2,550
7,079
Total
353,044
44,947
(5,106)
392,885
29,148
(50,409)
6,067
377,691
Total
122,270
106,733
On 1 August 2015, Company acquired 100% of the shares and voting interests in Universal Power Systems Private Limited ("Techzone"). The
following table summarizes the details of acquisition-
Amount ` in lakhs
a. Assets acquired
b. Liabilities acquired
c. Net Assets Acquired (a-b)
d. Purchase Consideration paid
e. Goodwill on Consolidation as at 31 March 2016 (d-c)
f. Impairement loss
G. Goodwill on Consolidation as at 31 March 2017 (e-f)
h. Impairement loss
I. Goodwill on Consolidation as at 31 March 2018 (g-h)
7,765
4,615
3,150
5,280
2,130
(70)
2,060
(777)
1,283
The Group tests annually whether goodwill has suffered impairment, in accordance with its accounting policy. The recoverable amount of
cash-generating units has been determined based on value in use calculations. We use market related information and estimates (generally risk
adjusted discounted cash flows) to determine value in use. Cash flow projections take into account past experience and represent management’s
best estimate about future developments. Key assumptions on which management has based its determination of fair value less costs to sell and
value in use includes estimated growth rates, weighted average cost of capital and tax rates.
As at 31 March 2018, for assessing impairment of goodwill, value in use is determined using discounted cash flow method. The estimated cash
flows for a period of four years were developed using internal forecasts, extrapolated for the fifth year, and a pre-tax discount rate of 15% and
terminal growth rate of 5%. These estimates, includes the methodology used, can have a material impact on the respective values and ultimately
the amount of any goodwill.
4
Loans
Unsecured considered good,unless otherwise stated
Amounts due from related parties (refer note 43)
Considered good
Considered doubtful
Less: Allowances for doubtful loans
Total
144 annual REpORt 2017-18
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
10,180
1,682
-
-
11,862
57
3,476
186
(186)
3,533
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
5
Other financial assets
Security deposits
Security deposits- related parties (refer note 43)
Security deposits- others
Total
6
Other non- current assets
Advance payment of taxes (net of provision)
Balances due with statutory authorities
Total
7
Inventory
VCD/ DVD/ Audio CDs
Film rights
Total
8
Trade and other receivables
Secured, considered good
Unsecured, considered good
Unsecured, considered doubtful
Less : Provision for doubtful debts
Others
Dues from related parties (refer note 43)
Accrued Income
Total
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
617
172
789
652
212
864
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
819
3,867
4,686
992
5,167
6,159
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
9
178
187
38
8
46
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
1,327
58,820
5,188
(5,188)
9,136
574
69,857
1,771
50,330
6,114
(6,114)
10,039
918
63,058
All amounts are short-term. The net carrying value of trade receivables is considered a reasonable approximation of fair value.
9
Cash and cash equivalents
Balances with banks
-In current accounts
-Cheques, drafts on hand
-Deposits with maturity of less than three months
Cash on hand
Other Bank Balances
-Deposits with maturity of more than 3 months but less than 12 months
Total
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
1,454
5
-
27
1,486
12,744
14,230
601
20
1
30
652
12,765
13,417
EROS IntERnatIOnal MEdIa lIMItEd 145
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Notes
to the consolidated financial statements and other explanatory information
10 Restricted bank deposits
Unclaimed dividend account
Deposits with maturity of less than 12 months
Margin money deposit- less than 12 Months
Deposits with maturity more than 12 months
Total
Less: Disclosed under non current financial assets - Restricted Bank deposits
Total
11 Loans
Unsecured considered good,unless otherwise stated
Amounts due from related parties (refer note 43)
Loans and advances to employees
Other loans
Security deposits
Total
12 Other financial assets
Interest accrued
Forward contract assets
Total
13 Other current assets
Prepaid-expenses
Others
Total
14 Share capital
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
1
-
3,775
716
4,492
(716)
3,776
1
1,353
2,902
217
4,473
(217)
4,256
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
335
159
637
36
1,167
-
197
2,800
16
3,013
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
114
188
302
187
-
187
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
56
627
683
110
15
125
` in lakhs, except share data
Authorised share capital
Equity shares of `10 each
Issued, subscribed and fully paid up
Equity shares of ` 10 each
Total
As at 31 March 2018
As at 31 March 2017
Number
Amounts
Number
Amounts
125,000,000
125,000,000
94,971,877
94,971,877
12,500
12,500
9,497
9,497
125,000,000
125,000,000
93,858,717
93,858,717
12,500
12,500
9,385
9,385
146 annual REpORt 2017-18
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
14 Share capital (Contd.)
a) Reconciliation of paid up share capital (Equity Shares)
Balance at the beginning of the year
Add: Shares issued during the year
Balance at the end of the year
` in lakhs, except share data
As at 31 March 2018
As at 31 March 2017
Number
Amounts
Number
Amounts
93,858,717
1,113,160
94,971,877
9,385
112
9,497
93,589,164
269,553
93,858,717
9,358
27
9,385
During the year, the Company has issued total 1,113,160 equity shares (31 March 2017: 269,553 ) on exercise of options granted under the
employees stock option plan (ESOP) wherein part consideration was received in the form of employees services.
b)
Shares held by holding company, ultimate holding company, subsidiaries / associates of holding company or ultimate holding company
` in lakhs, except share data
As at 31 March 2018
As at 31 March 2017
Number
Amounts
Number
Amounts
Equity shares of ` 10 each
Eros Worldwide FZ LLC - the Holding Company
Eros Digital Private Limited - fellow subsidiary
35,409,440
21,700,000
3,541
2,170
47,126,290
21,700,000
4,713
2,170
c) Details of Shareholders holding more than 5% of the shares
As at 31 March 2018
As at 31 March 2017
Number % Holding in the
class
Number % Holding in the
class
Equity shares of ` 10 each
Eros Worldwide FZ LLC - the Holding Company
Eros Digital Private Limited - fellow subsidiary
35,409,440
21,700,000
37.28%
22.85%
47,126,290
21,700,000
50.21%
23.12%
d) Details of employee stock options issued during the last 5 years
During the period of five years immediately preceding the reporting date, the Company has issued total 2,149,567 equity shares
(31 March 2017: 1,220,890) on exercise of options granted under the employees stock option plan (ESOP) wherein part consideration was
received in the form of employee services.
e) Details of equity share issued for consideration other than cash during the last 5 years
During the period of five years immediately preceding the reporting date, the Company has issued total 900,970 equity shares
(31 March 2017: 900,970) to the shareholders of Universal Power Systems Private Limited at a premium of ` 586 per share in exchange for the
entire shareholding of Universal Power Systems Private Limited.
f)
Rights, preferences, restrictions of Equity Shares
The Company has only one class of equity shares having par value of ` 10 per share. Every holder is entitled to one vote per share. The dividend,
if any, proposed by the Board of Directors and approved by the Shareholders in the Annual General Meeting is paid in Indian rupees.
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 of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
EROS IntERnatIOnal MEdIa lIMItEd 147
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Notes
to the consolidated financial statements and other explanatory information
15 Other equity
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
Securities premium
Balance at the beginning of the year
Add : Additions for employee stock options exercised during the year
Add : Transfer from share option outstanding account
Balance at the end of the year
Share options outstanding account
Balance at the beginning of the year
Less: Transfer to securities premium account
Add: Employee stock option compensation expense
Add: Employee stock option compensation expense to employee's of subsidiary
Balance at the end of the year
Capital reserves
As per last year balance sheet
General reserves
As per last year balance sheet
Surplus from Statement of Profit & Loss
Balance at the beginning of the year
Add : Profit for the year
Balance at the end of the year
Other comprehensive income
a) Foreign currency translation reserve
Balance at the beginning of the year
Movement during the year
Share of Non Controlling shareholders
Divestment of subsidiary
Balance at the ending of the year
b) Remeasurement gain on definted benfit plan
Total
Nature and Purpose of Reserves:-
38,141
247
2,110
40,498
2,645
(2,110)
862
180
1,577
56
508
144,499
22,934
167,433
5,668
(22)
222
(1,214)
4,654
77
37,513
-
628
38,141
1,775
(628)
1,464
34
2,645
56
508
118,754
25,745
144,499
6,592
(452)
(472)
-
5,668
4
214,803
191,521
Securities Premium Reserve: The amount received in excess of face value of the equity shares is recognized in Securities Premium Reserve.
General Reserve: General Reserve was created by transferring a portion of the net profit of the Company as per the requirements of the
Companies Act, 1956.
Capital Reserve: Capital Reserve is used from pre-acquisition profit of subsidiaries.
General Reserve : The General Reserve is used from time to time to transfer profit from retained earning for appropriation purpose.
Foreign Currency Translation Reserve : Exchange Fluctuation Reserve represents the unrealised gains and losses on account of translation
of foreign subsidiaries into the reporting currency.
148 annual REpORt 2017-18
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
16 Non- controlling interest
Balance at beginning of the year
Opening balance
Profit/(loss) for the year
Share in Foreign Currency Translation reserve
Divestment of subsidiary
Balance at end of year
17 Borrowings
a) Term Loans
Secured
Term loan from banks*
Car loans#
Unsecured
Term loan from others**
Less: Cumulative effect of unamortised cost
Less: Current maturities disclosed under other current financial liabilities (refer note 26)
Total
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
(466)
188
(222)
1,788
1,288
478
(1,416)
472
-
(466)
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
15,761
364
6,240
22,365
(196)
(7,217)
14,952
22,088
211
-
22,299
(158)
(7,201)
14,940
* Term loans from banks carry an interest rate between 12% - 14% are secured by pari passu first charge on the DVD/ satellite rights acquired
for the domestic market, actionable claims, revenue and receivables arising on sales of the rights and negatives of films. Term loans are further
secured by equitable mortgage of Company's immovable properties situated at Mumbai (India), amounts held as margin money,corporate
guarantee of Eros International PLC (the ultimate holding company), residual value of equipments and vehicles and existing rights of hindi films
with nil book value.
# Car loans are secured by hypothecation of vehicles acquired there against, carrying rate of interest of 7.48% - 9.50% which are repayable as
per maturity profile set out below.
** Term loan from others carry an interest rate of 14% are secured against the pledge of company's shares held by holding company, current
assets of a subsidiary company and corporate guarantee of holding company and subsidiary company.
Maturity profile of long term borrowing is set out below:-
Secured
Term loan from banks
Car loan
Unsecured
Term loan from others
Total
Less than 1 year
1-3 years
3-5 years
Amount ` in lakhs
6,322
155
740
7,217
8,386
209
3,220
11,815
1,053
-
2,280
3,333
EROS IntERnatIOnal MEdIa lIMItEd 149
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Notes
to the consolidated financial statements and other explanatory information
18 Trade payable - non current
Payable to related parties (refer note 43)
Total
19 Other financial liabilities
Security deposits
Total
20 Employee benefit obligations - non current
Provision for gratuity (refer note 40)
Leave encashment
Total
21 Deferred tax liabilities (net)
Deferred Tax Liability arising on account of
Depreciation on tangible assets
Amortization of intangible assets
Unabsorbed Business Losses
Total Deferred Tax Liability
Deferred Tax Asset arising on account of
Depreciation on tangible assets
Disallowances under Income Tax Act, 1961
Gratuity and leave encashment
Others
MAT credit recoverable
Total Deferred Tax Assets
Total Deferred Tax Liabilities (net)
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
102
102
84
84
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
-
-
1
1
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
476
11
487
423
27
450
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
107
26,742
-
26,849
54
971
15
797
511
2,348
24,501
154
30,209
248
30,611
64
741
30
477
6,800
8,112
22,499
Reconciliation of tax expense and the accounting profit multiplied by India's domestic tax rate:
Amount ` in lakhs
Profit before tax
Income tax expense at tax rates applicable to individual entities
Effect of Income taxed at higher/ (lower) rates
Effect of Income taxes relating to prior years
Effect of change in deferred tax balances due to change in tax rates
Effect of Items not deductible for tax purpose
Effect of unrecognized deferred tax assets
Effect of Minimum alternative tax credit
Others
Tax expense as per Statement of Profit and Loss
150 annual REpORt 2017-18
As at
31 March 2018
As at
31 March 2017
28,735
4,262
-
177
247
313
668
-
(54)
5,613
32,223
7,548
(31)
207
-
330
-
(52)
(108)
7,894
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
22 Other non-current liabilities
Deferred revenue
Total
23 Short-term borrowings
Secured
Secured from banks
Unsecured
Unsecured *
From related parties (refer note 43)
Total
Secured short term borrowings include:
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
1,512
1,512
3,016
3,016
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
38,813
36,517
7,515
480
46,808
1,900
4,616
43,033
Cash credit, secured by way of hypothecation of inventories and receivables relating to domestic rights operations on pari passu basis.
Bills discounted, secured by document of title to goods and accepted hundies with first pari passu charge on current assets.
Drawee bills discounted secured by assignment of film processing laboratory letter conveying rights on the negative of the particular film being
co-produced.
Packing credit, secured by hypothecation of films and film rights with first pari passu charge on current assets.
Short term borrowings are further secured by equitable mortgage of company's immovable properties situated at Mumbai (India),amount held
in margin money,corporate guarantee of Eros International Plc (the ultimate holding company),residual value of equipments and existing rights of
hindi films with nil book value.
*Loan from others are secured by security provided by holding company.
24 Acceptances
Payable under the film financing arrangements
Total
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
5,796
5,796
5,795
5,795
Acceptances comprise of credit availed from financial institutions for payment to film producers for film co-production arrangement entered by
the group. The carrying value of acceptances are considered a reasonable approximation of fair value.
25 Trade payables - current financials liabilities
Trade payable
Payable to related parties (refer note 43)
Total
26 Other financial liabilities
Current maturities of long-term borrowings (refer note 17)
Interest accrued but not due on borrowings
Employee dues
Unclaimed dividend*
Other expenses payable
Other payable to related party (refer note 43)
Total
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
11,780
20,547
32,327
14,040
15,502
29,542
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
7,217
299
373
1
902
274
9,066
7,201
382
697
1
2,422
183
10,886
*These figures do not includes any amount due and outstanding to be credited to Investor Education and Protection Fund.
EROS IntERnatIOnal MEdIa lIMItEd 151
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Notes
to the consolidated financial statements and other explanatory information
27 Employee benefit obligations - current
Gratuity
Compensated Absences
Total
28 Current tax liabilites (net)
Provision for Corporate Taxes (net of advance tax)
Total
29 Other Current Liabilities
Advance from customers- related parties (refer note 43)
Advances from customers- Others
Duties & Taxes Payable
Trade / security deposits received
Deferred income
Others
Total
30 Revenue from operations
Sale/distribution/exhibition of films and other rights
Other operating revenues
Total
31 Other income
Dividend Income
Interest income :
Bank deposits
Others
Income from Export Incentives
Sundry balances written back and Bad debts recovered
Provision written back for expected credit loss
Gain on disposal of property, plan and equipment (net)
Other non-operating income
Total
152 annual REpORt 2017-18
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
63
161
224
51
167
218
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
3,684
3,684
4,400
4,400
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
3,452
1,152
6,555
-
2,449
29
13,637
18,302
1,672
9,438
7
2,810
49
32,278
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
95,815
201
96,016
139,916
54
139,970
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
-
215
648
-
98
2,490
6
1,528
4,985
0
212
-
946
383
2,246
-
771
4,558
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
32 Purchases / Operating Expenses
Film rights cost
Amortization of film rights (refer note 3)
Total
33 Changes in Inventories
Inventories at the end of the year of -
VCD/ DVD/ Audio CDs
Film Rights
Inventories at the beginning of the year of -
VCD/ DVD/ Audio CDs
Film Rights
Total
34 Employee benefit expenses
Salaries and wages
Contributions to provident and other funds (refer note 40)
Employee share based compensation (refer note 41)
Gratuity expenses
Staff welfare expenses
Total
35 Finance costs
Interest expenses on loans taken from banks
Other interest expenses
Interest on delayed payment of taxes
Less: Interest expenses capitalised to film rights*
Less : Interest received
Total
*The capitalisation rate of interest was 10.91 % (31 March 2017 : 9.95 %)
36 Depreciation and amortization expenses
Depreciation on property, plants and equipments (refer note 2)
Amortization on intangible assets other than film rights (refer note 3)
Total
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
11,089
28,838
39,927
33,854
44,630
78,484
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
9
178
187
38
8
46
(141)
38
8
46
89
251
340
294
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
4,333
217
1,013
221
110
5,894
5,109
248
1,433
112
151
7,053
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
8,359
502
1,571
10,432
(2,115)
(264)
8,053
5,053
542
1,722
7,317
(1,657)
(208)
5,452
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
718
310
1,028
641
317
958
EROS IntERnatIOnal MEdIa lIMItEd 153
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Notes
to the consolidated financial statements and other explanatory information
37 Other expenses
Print & digital distribution cost
Selling & distribution expenses
Processing and other direct cost
Home Entertainment products related cost
Shipping, Packing & Forwarding Expenses
Power and fuel
Rent including lease rentals
Repairs and maintenance
Insurance
Rates and taxes
Communication Expenses
Travelling and conveyance
Legal and professional expenses
Payments to auditors
Trade receivables written off
Content advance written off
Advances & deposits written off
Provision for doubtful receivables
Provision for doubtful advances
Loss on disposal of propery, plant and equipment
Provision for diminishment in the value of investments
Corporate social responsibility expenses
Loss on foreign exchange (net)
Miscellaneous expenses
Total
38 Earnings per share
a) Computation of net profit for the year
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
1,182
3,491
208
23
72
81
443
147
21
82
77
298
1,404
157
5,541
228
44
1,652
295
-
777
18
693
571
17,505
2,841
6,509
591
64
198
104
651
201
24
140
110
389
1,400
240
337
741
294
3,111
283
35
70
31
1,021
679
20,064
Year ended
31 March 2018
Year ended
31 March 2017
Profit after tax attributable to equity shareholders (` in lakhs)
22,934
25,745
b) Computation of number of shares for Basic Earnings per share
Weighted average number of equity shares
Total
c) Computation of number of shares for Diluted Earnings per share
94,524,136
93,654,393
94,524,136
93,654,393
Weighted average number of equity shares used in the calculation of basic earning per share
94,524,136
93,654,393
Add:- Effect of ESOPs
Total
d) Nominal value of shares
e) Computation
Basic (in `)
Diluted (in `)
154 annual REpORt 2017-18
1,342,648
1,682,594
95,866,784
95,336,987
10
10
24.26
23.92
27.49
27.00
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
39 Contingent liabilities and commitments (to the extent not provided for)
a) Contingent liabilities
(i) Claims against the Company not acknowledged as debt
Sales tax claims disputed by the Company
Service tax claim disputed by the Company
Income tax liability that may arise in respect of matters in appeal
(ii) Guarantees
Guarantee given in favor of various government authorities
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
3,195
39,757
79
25
Total (a)
43,056
1,573
38,863
103
25
40,564
Notes:
1.a During the year ended 31 March 2015, the Company received a show cause notice from the Commissioner of Service Tax to show cause
why an amount aggregating to ` 19,470 lakhs for the period 1 April 2009 to 31 March 2014 should not be levied on and paid by the
Company for service tax arising on temporary transfer of copyright services and other matters.
In connection with the aforementioned matters, on 19 May 2015, the Company received an Order-in-orginal issued by the Principal
Commissioner, Service Tax, wherein the department confirmed the demand of ` 19,470 lakhs along with interest and penalty amounting to
` 19,470 lakhs resulting into a total demand of ` 38,940 lakhs.
On 3 September 2015, the Company filed an appeal against the said order before the authorities. Considering the facts and nature of levies
and the ad-interim protection for the period 1 July 2010 to 30 June 2012 granted by the Honorable High Court of Mumbai, the Company
expects that the final outcome of this matter will be favorable. Accordingly, based on the assessment made after taking appropriate legal
advise, no additional liability has been recorded in the financial statements.
1.b On 18 April 2016, a subsidiary of the Company- Eros International Films Private Limited, received a show cause notice
from the Commissioner of Service Tax to show cause why an amount aggregating to ` 597 lakhs for the period
1 April 2014 to 31 March 2015 should not be levied on and paid by the Company for service tax arising on temporary transfer of
copyright services and other matters. Considering the facts and nature of levies and the ad-interim protection for the period
1 July 2010 to 30 June 2012 granted by the Honorable High Court of Mumbai, the Company expects that the final outcome of this matter
will be favorable. Accordingly, based on the assessment made after taking appropriate legal advise, no additional liability has been recorded
in the financial statements.
1.c On 28 February 2013, a subsidiary of the Company- Universal Power Systems Private Limited (acquired on 1 August 2015), received a
service tax order with reference to the internal audit conducted by the service tax department. Based on the audit conducted, department
has demanded tax amounting to ` 113 lakhs against which the subsidiary has paid ` 20 lakhs. The subsidiary has not made any provision in
the books to give effect to this order and filed an appeal against the demand. The subsidiary expects that the final outcome will be favorable.
Accordingly, based on the assessment made after appropriate legal advice, ` 94 lakhs has been considered as contingent liability and no
liability has been recorded in the financial statements.
2
3
4
In addition, the Company is liable to pay service tax on use on temporary transfer of copyright in the period 1 July 2010 to 30 June 2012.
The Company filed a writ petition in Mumbai High Court challenging the constitutionality and the legality of this entry and received ad-interim
protection and accordingly, no amounts were provided for by the Company for the period 1 April 2011 to 30 June 2012.
It is not practicable for the Group to estimate the timing of cash outflows,if any, in respect of the above, pending resolution of the respective
proceedings.
From time to time, the Group is involved in legal proceedings arising in the ordinary course of its business, typically intellectual property
litigation and infringement claims related to the Company's feature films and other commercial activities, which could cause the Company
to incur expenses or prevent the Company from releasing a film. While the resolution of these matters cannot be predicted with certainty,
the Company does not believe, based on current knowledge or information available, that any existing legal proceedings or claims are likely
to have a material and adverse effect on its financial position, results of operations or cash flows.
5
The Company does not expect any reimbursements in respect of the above contingent liabilities.
(b) Commitments
Estimated amount of contracts remaining to be executed on capital account
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
176,842
176,842
219,898
160,859
160,859
201,423
Total (b)
Total (a)+(b)
EROS IntERnatIOnal MEdIa lIMItEd 155
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Notes
to the consolidated financial statements and other explanatory information
40 Employment benefits
a) Gratuity
The following table set out the status of the gratuity plan as required under Indian Accounting Standard (Ind AS) - 19, Employee benefits, and the
reconciliation of opening and closing balances of the present value of the defined benefit obligation:
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
I Change in projected benefit obligation
Liability at the beginning of the year
Interest cost
Current service cost
Past service cost
Benefits paid
Actuarial loss on obligations
Liability at the end of the year
Current portion
Non-current portion
II Recognized in Balance Sheet
Liability at the end of the year
Amount recognized in Balance Sheet
III Expense recognized in Statement of Profit and loss
Current service cost
Interest cost
Past service cost
Actuarial (Gains) / losses*
Arising from changes in experience
Arising from changes in financial assumptions
Expense/(income) recognized in Other comprehensive income
474
35
80
106
(45)
(111)
539
63
476
539
539
80
35
106
221
(89)
(22)
(111)
373
30
82
-
(11)
0
474
51
423
474
474
82
30
-
112
(13)
13
-
*Actuarial (gain)/loss of ` (111) Lakhs (31 March 2017: ` Nil) is included in other comprehensive
income.
IV Assumptions used
Discount rate
Long-term rate of compensation increase
Attrition Rate
Expected average remaining working life
7.35%- 7.85%
10.00%
2% -20%
4-17 years
7.52%
10.00%
2.00%
18 years
156 annual REpORt 2017-18
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
40 Employment benefits (Contd.)
V A quantitative sensitivity analysis for significant assumption as at 31 March 2018 is as shown below:
Amount ` in lakhs
Impact on defined benefit obligation
Projected benefit obligation on current assumption
Discount rate
1.00 % increase
1.00 % decrease
Rate of increase in salary
1.00 % increase
1.00 % decrease
Rate of increase in employee turnover
1.00 % increase
1.00 % decrease
VI Maturity profile of defined benefit obligation
Year
Year 1
Year 2
Year 3
Year 4
Year 5
Sum of Years 6-10
As at
31 March 2018
As at
31 March 2017
539
(56)
68
45
(40)
(7)
8
474
(28)
32
24
(23)
(3)
3
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
62
27
19
19
37
146
51
19
29
22
20
143
VII
Interest rate risk: A fall in the discount rate which is linked to the G.Sec. Rate will increase the present value of the liability requiring higher
provision.
VIII Salary Risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of members. As such, an
increase in the salary of the members more than assumed level will increase the plan's liability.
IX Asset Liability Matching Risk: The plan faces the ALM risk as to the matching cash flow. Company has to manage pay-out based on pay
as you go basis from own funds.
X Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any
longevity risk.
b) Compensated absences
The Company incurred ` 36 lakhs (31 March 2017 ` 141 lakhs) towards accrual for compensated absences during the year.
c) Provident fund
The Company contributed ` 198 lakhs (31 March 2017 ` 232 lakhs) to the provident fund plan, ` 8 lakhs (31 March 2017 ` 6 lakhs) to the
Employee state insurance plan and ` 11 lakhs (31 March 2017 ` 10 lakhs) to the National Pension Scheme during the year.
EROS IntERnatIOnal MEdIa lIMItEd 157
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Notes
to the consolidated financial statements and other explanatory information
41 Share Based Compensation
The Company has instituted Employees’ Stock Option Plan “ESOP 2009” and "ESOS 2017" under which the stock options have been granted
to employees. The scheme was approved by the shareholders at the Extra Ordinary General Meeting held on 4 December 2009 and Annual
General Meeting held on 28 September 2017 respectively. The details of activity under the ESOP 2009 scheme are summarized below:
The expense recognized for employee services received during the year is shown in the following table:
Amount ` in lakhs
Expense arising from equity-settled share-based payment transactions
There were no cancellations or modifications to the awards in 31 March 2018 and
31 March 2017.
Movements during the year
The following table illustrates the number and weighted average exercise prices (WAEP) of, and
movements in, share options during the year:
Year ended
31 March 2018
Year ended
31 March 2017
1,013
1,433
Outstanding at 1 April
Granted during the year
Forfeited during the year
Exercised during the year
Outstanding at 31 March
Exercisable at 31 March
Range of exercise price of outstanding options (`)
Weighted average remaining contractual life of option
*WAEP denotes weighted average exercise price of the option
As at 31 March 2018
As at 31 March 2017
Number
WAEP*
Number
WAEP*
2,108,063
863,320
(234,189)
(1,113,160)
1,624,034
501,122
36
10
10
32
29
71
2,196,215
282,227
(100,826)
(269,553)
2,108,063
911,854
35
10
10
10
36
64
` 10-175
2.96 Years
` 10-175
4.07 Years
Black Scholes valuation model has been used for computing the weighted average fair value considering the following inputs:
Date of grant
Particulars
17-Dec-09 12-Aug-10
1-Jul-12 14-Oct-13 12-Nov-14
12-Feb-15
9-Feb-16
10-Feb-17 14-Nov-17 10-Feb-18
Dividend yield
(%)
Expected
volatility
Risk free
interest rate
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
75.00%
60.00%
44.00%
35.00%
40.11%
37.84%
46.46%
48.66%
56.53%
53.15%
6.30%
6.50%
8.36%
8.57%
8.50%
7.74%
7.49%
6.51%
6.90%
7.38%
Exercise price
75-175
75-135
5.25
5.25
Expected life
of options
granted in
years
Table 1.1
Expected life of options granted in years
75
5.50
150
4.50
10
10
10
As per Table 1.1
10
4.27
10
3.50
10
4.50
Option Grant date
9-Feb-16
12-Feb-15
12-Nov-14
Year I
Year II
Year III
Old
Employees
New
Employees
Old
Employees
New
Employees
Old
Employees
New
Employees
3.50
4.50
5.50
4.50
5.50
6.50
3.00
3.50
4.00
3.00
4.00
4.50
3.50
4.50
5.50
4.50
5.50
6.50
The expected life of options is based on historical data and current expectations and is not necessarily indicative of exercise patterns that may
occur. The expected volatility reflects the assumption that the historical volatility over a period similar to the life of the options is indicative of future
trends, which may differ from the actual.
158 annual REpORt 2017-18
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
42 Segment Reporting
Description of segment and principal activities
The Company acquires, co-produces and distributes Indian films in multiple formats worldwide. Film content is monitored and strategic decisions
around the business operations are made based on the film content, whether it is new release or library. Hence, Management identifies only
one operating segment in the business, film content. The Company distributes film content to the Indian population in India and worldwide and
to non-Indian consumers who view Indian films that are subtitled or dubbed in local languages. As a result of these distribution activities, the
management examines the performance of the business from a geographical market perspective.
Revenue by region of domicile of customer's location
India
United Arab Emirates
Rest of the world
Total revenue
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
61,824
16,382
17,810
96,016
84,640
43,163
12,167
139,970
Non-current assets other than financial instruments, investments accounted for using equity method and deferred tax
Amount ` in lakhs
Non-current assets
India
United Arab Emirates
Rest of the world
Total non-current assets
43 Related party disclosures
Parent entity
Relationship
Ultimate holding company
Holding company
As at
31 March 2018
As at
31 March 2017
226,721
28,991
18,492
274,204
226,476
18,787
32,611
277,874
Name
Eros International PLC
Eros Worldwide FZ LLC
List of Key management personnel (KMP)
Mr. Sunil Arjan Lulla – Executive Vice Chairman and Managing Director
Mr. Kishore Arjan Lulla – Executive Director
Mrs. Jyoti Deshpande – Executive Director
Mr. Dinesh Modi -Group Chief Financial Officer (India) (upto 8 March 2018)
Mr. Farokh P. Gandhi - Chief Financial Officer (w.e.f. 9 March 2018)
Mrs. Dimple Mehta - Vice President Company Secretary and Compliance Officer (upto 14 December 2017)
Mr. Abhishekh Kanoi - Vice President Company Secretary and Compliance Officer (w.e.f. 15 December 2017)
Relatives of KMP with whom transactions exist
Mrs. Manjula K Lulla (wife of Mr. Kishore Arjan Lulla)
Mrs. Krishika Lulla (wife of Mr. Sunil Arjan Lulla)
Entities over which KMP exercise significant influence
Shivam Enterprises
Fellow subsidiary company
Eros Television India Private Limited
Eros Digital Private Limited
Eros International Limited, United Kingdom
Eros Digital FZ LLC
EROS IntERnatIOnal MEdIa lIMItEd 159
Corporate overview | ManageMent report | financial management
Notes
to the consolidated financial statements and other explanatory information
43 Related party disclosures (Contd.)
c)
Transactions with related parties
Sale of film rights
Eros Worldwide FZ LLC
Revenue attributable to Eros Digital FZ LLC
Sale of prints/VCD/DVD
Eros Worldwide FZ LLC
Total
Purchase of film rights
Eros International Limited
Total
Re-imbursement of administrative expense
Eros Worldwide FZ LLC
Eros Digital FZ LLC
Total
Rent expenses
Mr. Sunil Arjan Lulla
Mrs. Manjula K Lulla
Mr. Kishore Arjan Lulla
Total
Interest income
Eros International Limited
Total
Interest expenses
Eros Digital Private Limited
Eros Television India Private Limited
Total
Salary, commission and perquisites* to KMPs
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
10,592
10,592
(10,449)
6
6
-
-
609
7,222
7,831
276
240
36
552
645
645
49
482
531
1,657
38,202
38,202
(5,004)
40
40
7,360
7,360
759
2,742
3,501
276
240
36
552
41
41
46
24
70
916
Total
* Perquisites to KMP have been valued as per Income Tax Act, 1961 and rules framed thereunder or at actuals as the case may be.
Excludes ` 72 lakhs (31 March 2017 : ` 66 lakhs) charged to Statement of Profit and loss on account of stock compensation for awards granted.
1,657
916
d)
Transactions with related parties
Content advances given
Eros International Limited
Total
Refund of content advances
Eros International Limited
Total
Trade advances/ loans given
Eros Television India Private Limited
Eros Worldwide FZ LLC
Total
Recovery of trade advances/ loans given
Eros Television India Private Limited
Total
Trade advances/ loans taken
Eros Worldwide FZ LLC
Eros International Limited
160 annual REpORt 2017-18
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
11,180
11,180
18,709
18,709
65
10,123
10,188
62
62
3,257
354
7,609
7,609
2,689
2,689
-
-
-
-
-
14,614
12,635
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
43 Related party disclosures (Continued)
Eros Television India Private Limited
Total
Repayment of advances/ loans
Eros Worldwide FZ LLC
Eros International Limited
Eros Digital Private Limited
Eros Television India Private Limited
Total
Refund of deposits
Mr. Sunil Arjan Lulla
Total
Balances with related parties
Trade balances due from
Eros Worldwide FZ LLC
Eros Digital FZ LLC
Eros International Limited
Total
Trade balances due to
Eros Worldwide FZ LLC
Eros International Limited
Eros Digital FZ LLC
Total
Advances/Loan due to
Eros Worldwide FZ LLC
Eros Digital Private Limited
Eros Television India Private Limited
Total
Content advances given to
Eros International Limited
Total
Loans and advances due from
Eros Worldwide FZ LLC
Shivam Enterprises
Eros Television India Private Limited
Total
Security Deposits/Amounts due from KMPs or their relatives
Mr. Sunil Arjan Lulla
Mr. Kishore Arjan Lulla
Mrs. Manjula K. Lulla
Mrs. Krishika Lulla
Total
Amounts due to KMPs or their relatives
Mr. Sunil Arjan Lulla
Mr. Kishore Arjan Lulla
Mrs. Jyoti Deshpande
Mrs. Manjula K. Lulla
Total
2
Terms and conditions
All outstanding balances are unsecured and repayable in cash.
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
610
4,221
18,416
354
23
5,254
24,047
33
33
4,150
31,399
54,008
12,558
10
10
66,586
26
26
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
6,595
2,453
88
9,136
13,303
102
7,244
20,649
3,452
480
-
3,932
332
332
10,123
57
3
10,183
302
240
75
-
617
117
115
-
42
274
7,835
2,116
88
10,039
13,477
84
2,025
15,586
18,302
454
4,162
22,918
-
-
-
57
-
57
336
240
75
1
652
121
43
12
7
183
EROS IntERnatIOnal MEdIa lIMItEd 161
Corporate overview | ManageMent report | financial management
Notes
to the consolidated financial statements and other explanatory information
44
Categories of financial assets and financial liabilities
The carrying value and fair value of financial instruments by categories are as follows:
Amount ` in lakhs
Particulars
Financial assets
Measured at fair value through Statement of Profit and Loss
Investments
Measured at amortised cost
Loans
Restricted bank deposits
Other financial assets
Trade receivables
Cash and cash equivalents
Financial liabilities
Measured at amortised cost
Borrowings
Acceptance
Trade payables
Other financial liabilities
Carrying value /Fair value
As at
31 March 2018
As at
31 March 2017
0
0
13,029
4,492
1,091
69,857
14,230
102,699
61,760
5,796
32,429
9,066
0
0
6,546
4,473
1,051
63,058
13,417
88,545
57,973
5,795
29,626
10,887
45 Fair value measurement of financial instruments
Financial assets and financial liabilities measured at fair value in the balance sheet are grouped into three Levels of a fair value hierarchy. The three Levels
are defined based in the observability of significant inputs to the measurement, as follows:
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly
Level 3: unobservable inputs for the asset or liability
The following table shows the Levels within the hierarchy of financial assets and liabilities measured at fair value on a recurring basis:
109,051
104,281
Particulars
Financial assets
Measured at fair value through Statement of
Profit and Loss
Investments
Total
Carrying value /Fair value
Level 1
Level 2
Level 3
Amount ` in lakhs
As at
31 March 2018
0
0
0
0
-
-
-
-
162 annual REpORt 2017-18
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
45 Fair value measurement of financial instruments (Contd.)
The following table shows the financial assets and liabilities measured at amortised cost on a recurring basis:
Amount ` in lakhs
Particulars
Carrying value /Fair value
As at
31 March 2018
Level 1
Level 2
Level 3
Measured at amortised cost
Financial assets
Loans
Restricted deposits
Other financial assets
Trade receivables
Cash and cash equivalents
Measured at amortised cost
Financial liabilities
Borrowings- Non-current
Borrowings- Current
Acceptance
Trade payables
Other financial liabilities
Total
13,029
4,492
1,091
69,857
14,230
102,699
14,952
46,808
5,796
32,429
9,066
109,051
-
-
-
-
-
-
-
-
-
-
-
-
-
-
789
-
-
789
14,952
-
-
-
-
14,952
-
-
-
-
-
-
-
-
-
-
-
-
-
During the year ended 31 March 2018 there was no transfer between level 2 and level 3 fair value hierarchy.
Fair value of cash and short term deposits, trade and other short term receivables, trade payables, other current liabilities and short term borrowings
carried at amortised cost is not materially different from its carrying cost largely due to short term maturities of these financial assets and liabilities.
Fair value of the borrowing items fall within level 2 of the fair value hierarchy and is calculated on the basis of discounted future cash flows.
Financial instruments with fixed and variable interest rate fall within level 2 of the fair value hierarchy and are evaluated by Company based on parameters
such as interest rate, credit rating or assessed credit worthiness.
Particulars
Financial assets
Measured at fair value through Statement
of Profit and Loss
Investments
Total
Carrying value /Fair value
Level 1
Level 2
Level 3
Amount ` in lakhs
As at
31 March 2017
0
0
0
0
-
-
-
-
EROS IntERnatIOnal MEdIa lIMItEd 163
Corporate overview | ManageMent report | financial management
Notes
to the consolidated financial statements and other explanatory information
45 Fair value measurement of financial instruments (Continued)
The following table shows the financial assets and liabilities measured at amortised cost on a recurring basis:
Amount ` in lakhs
Particulars
Carrying value /Fair value
As at
31 March 2017
Level 1
Level 2
Level 3
Measured at amortised cost
Financial assets
Loans
Restricted deposits
Other financial assets
Trade receivables
Cash and cash equivalents
Measured at amortised cost
Financial liabilities
Borrowings- Non-current
Borrowings- Current
Acceptance
Trade payables
Other financial liabilities
Total
6,546
4,473
1,051
63,058
13,417
88,545
14,940
43,033
5,795
29,626
10,887
104,281
-
-
-
-
-
-
-
-
-
-
-
-
-
864
-
-
-
864
14,940
-
-
-
-
14,940
-
-
-
-
-
-
-
-
-
-
-
-
-
During the year ended 31 March 2017 there was no transfer between level 2 and level 3 fair value hierarchy.
Fair value of cash and short term deposits, trade and other short term receivables, trade payables, other current liabilities and short term borrowings
carried at amortised cost is not materially different from its carrying cost largely due to short term maturities of these financial assets and liabilities
46 Financial instruments and Risk management
The Company is exposed to various risks in relation to financial instruments. The Company’s financial assets and liabilities by category are
summarised in note. The main types of risks are market risk, credit risk and liquidity risk.
The Company’s risk management is coordinated in close cooperation with the board of directors and audit committee meetings.
The Company has established objectives concerning the holding and use of financial instruments. The underlying basis of these objectives is to
manage the financial risks faced by the Company.
Formal policies and guidelines have been set to achieve these objectives. The Company does not enter into speculative arrangements or trade
in financial instruments and it is the Company’s policy not to enter into complex financial instruments unless there are specific identified risks for
which such instruments help mitigate uncertainties.
Management of Capital Risk and Financial Risk
The Company manages its capital to ensure that it will be able to continue as a going concern while maximizing the return to shareholders
through the optimization of the debt and equity balance. The Company monitors capital using a gearing ratio, which is net debt divided by total
capital. For the purpose of the Company’s capital management, capital includes issued capital and all other equity reserves attributable to the
equity shareholders of the Company. Net debt is calculated as borrowing (refer note 17, 23, 24 and 26) less cash and cash equivalents.
The gearing ratio at the end of the reporting period was as follows:
Debt
Less: Cash and cash equivalents
Net debt
Equity
Net debt to equity
164 annual REpORt 2017-18
Amount ` in lakhs
As at
31 March 2018
As at
31 March 2017
74,773
(14,230)
60,543
225,588
26.84%
70,969
(13,417)
57,552
200,440
28.71%
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
46 Financial instruments and Risk management (Contd.)
Financial risk management objectives
Based on the operations of the Company , Management considers that key financial risks that it faces are credit risk, currency risk, liquidity risk
and interest rate risk. The objectives under each of these risks are as follows:
• credit risk: minimize the risk of default and concentration.
• currency risk: reduce exposure to foreign exchange movements principally between INR and USD.
• liquidity risk: ensure adequate funding to support working capital and future capital expenditure requirements.
• interest rate risk: mitigate risk of significant change in market rates on the cash flow of issued variable rate debt.
Credit Risk
The Company’s credit risk is principally attributable to its trade receivables, loans and bank balances. As a number of the Company’s trading
activities require third parties to report revenues due to the Company this risk is not limited to the initial agreed sale or advance amounts. The
amounts shown within the Balance Sheet in respect of trade receivables and loans are net of allowances for doubtful debts based upon objective
evidence that the Company will not be able to collect all amounts due.
Trading credit risk is managed on a customer by customer basis by the use of credit checks on new clients and individual credit limits, where
appropriate, together with regular updates on any changes in the trading partner’s situation. In a number of cases trading partners will be required
to make advance payments or minimum guarantee payments before delivery of any goods. The Company reviews reports received from third
parties and in certain cases as a matter of course reserve the right within the contracts it enters into to request an independent third party audit
of the revenue reporting.
The credit risk on bank balances is limited because the counterparties are banks with high credit ratings as signed by international credit rating
agencies.
The Company from time to time will have significant concentration of credit risk in relation to individual theatrical releases, television syndication
deals or digital licenses. This risk is mitigated by contractual terms which seek to stagger receipts and/or the release or airing of content.
As at 31 March 2018 37% (31 March 2017: 40%) of trade account receivables were represented by the top 5 customer, out of which as at
31 March 2018 9% (31 March 2017: 13%) of trade account receivables were represented by the related parties. The maximum exposure to credit
risk is that shown within the statement of financial position.
As at 31 March 2018, the Company did not hold any material collateral or other credit enhancements to cover its credit risks associated with its
financial assets.
Currency Risk
The Company is exposed to foreign exchange risk from foreign currency transactions. As a result it faces both translation and transaction
currency risks which are principally mitigated by matching foreign currency revenues and costs wherever possible.
The Company has identified that it will need to utilize hedge transactions to mitigate any risks in movements between the US Dollar and the Indian
Rupee and has adopted an agreed set of principles that will be used when entering into any such transactions. No such transactions have been
entered into to date and the Company has managed foreign currency exposure to date by seeking to match foreign currency inflows and outflows
as much as possible such as packing credit repayment in USD is matched with remittances from UAE in USD. Details of the foreign currency
borrowings that the Company uses to mitigate risk are shown within Interest Risk disclosures.
As at the Balance Sheet date there were no outstanding forward foreign exchange contracts. The Company adopts a policy of borrowing where
appropriate in the local currency as a hedge against translation risk. The table below shows the Company’s net foreign currency monetary assets
and liabilities position in the main foreign currencies, translated to Indian Ruppes (INR) equivalents, as at the year end:
As at 31 March 2018
As at 31 March 2017
Amount in lakhs
Net balance receivables / (payables)
INR
USD
SGD
GBP
EUR
1,363
258
26
10
0
-
(3)
(3)
-
(1)
The above foreign currency arises when the Company holds monetary assets and liabilities denominated in a currency other than `.
A uniform decrease of 10% in exchange rates against all foreign currencies in position as of 31 March 2018 would have decreased in the
Company’s net profit before tax by approximately ` 136 lakhs (31 March 2017: gain of ` 25 lakhs). An equal and opposite impact would be
experienced in the event of an increase by a similar percentage
EROS IntERnatIOnal MEdIa lIMItEd 165
Corporate overview | ManageMent report | financial management
Notes
to the consolidated financial statements and other explanatory information
46 Financial instruments and Risk management (contd.)
Liquidity risk
The Company manages liquidity risk by maintaining adequate reserves and agreed committed banking facilities. Management of working capital
takes account of film release dates and payment terms agreed with customers.
A maturity analysis for financial liabilities is provided below. The amounts disclosed are based on contractual undiscounted cash flows. The table
includes both interest and principal cash flows. To the extent that interest flows are floating rate, the undiscounted amount is derived from interest
rates as at 31 March, in each year.
As at 31 March 2018
Borrowing principal payments
Borrowing interest payments
Acceptance
Trade and other payables
As at 31 March 2017
Borrowing principal payments
Borrowing interest payments
Acceptance
Total
Less than 1
year
1-3 years
3-5 years More than 5
years
Amount ` in lakhs
69,173
9,917
5,796
32,429
53,899
7,225
5,796
32,327
11,939
2,418
-
102
3,335
274
-
-
-
-
-
-
Total
Less than 1
year
1-3 years
3-5 years More than 5
years
Amount ` in lakhs
65,332
10,081
5,795
50,227
7,148
5,795
10,429
2,500
-
4,676
433
-
-
-
-
Trade and other payables
-
At 31 March 2018, the Company had facilities available of ` 74,780 Lakhs (31 March 2017: ` 70,990 Lakhs) and had net undrawn amounts of
` 414 Lakhs ( 31 March 2017: ` 1,444 Lakhs) available.
29,627
29,542
85
-
Interest rate risk
Fluctuation in fair value or future cash flows of a financial instrument because of changes in market interest rates gives rise to interest rate risk.
A uniform increase of 100 basis in interest rates against all borrowings in position as of 31 March 2018 would have decreased in the Company’s
net profit before tax by approximately ` 317 lakhs (31 March 2017: net profit before tax of ` 213 lakhs). An equal and opposite impact would be
experienced in the event of a decrease by a similar basis.
47 a. Enterprises Consolidated as Subsidiary in accordance with Indian Accounting Standard 110- Consolidated Financial Statements
Name of enterprises
Sr.
No.
1
2
3
4
5
6
7
8
9
Eros International Films Private Limited
Big Screen Entertainment Private Limited
EyeQube Studios Private Limited
EM Publishing Private Limited
Eros Animation Private Limited
Copsale Limited
Digicine PTE Limited
Colour Yellow Productions Private Limited
Universal Power Systems Private Limited
10 Ayngaran International Limited (Isle of Man) *
11 Ayngaran International UK Limited*
12 Ayngaran International Mauritius Limited*
13 Ayngaran International Media Private Limited*
14 Ayngaran Anak Media Private Limited*
*The Group has divested five subsidiaries on 1 October 2017.
Country of
incorporation
Proportion of
ownership interest
India
India
India
India
India
British Virigin Island
Singapore
India
India
Isle of Man
United Kingdom
Mauritius
India
India
100%
64%
100%
100%
100%
100%
100%
50%
100%
51%
100%
100%
100%
51%
166 annual REpORt 2017-18
Consolidated statements
Notes
to the consolidated financial statements and other explanatory information
47 b. Additional information, as required under Schedule III to the Companies Act, 2013, of enterprises consolidated as Subsidiary/
Associates/Joint Ventures
Name of Enterprises
Net Assets, i.e., total
assets minus total
liabilities
Share in profit or loss
Share in other
comprehensive income
Share in total
comprehensive income
` in lakhs
As % of
consolidated
net assets
As % of
consolidated
profit or loss
` in lakhs
` in lakhs
As % of
consolidated
other
comprehensive
income
` in lakhs
As % of
consolidated
total
comprehensive
income
Parent
Eros International Media Limited
64% 144,199
33%
7,701
109%
56
33%
7,757
Subsidiaries
Indian
Eros International Films Private
Limited
Big Screen Entertainment Private
Limited
EyeQube Studios Private Limited
EM Publishing Private Limited
Eros Animation Private Limited
Colour Yellow Productions Private
Limited
Universal Power Systems Private
Limited
0.8%
1,715
-0.2%
(39)
0.0%
79
-0.1%
(22)
0.0%
0.0%
0.0%
39
(20)
(1)
1%
2,390
0.0%
0.0%
0.0%
2%
(6)
(2)
(0)
534
-
-
-
-
-
-
-
-
-
-
-
-
-0.2%
(39)
-0.1%
(30)
0.0%
0.0%
0.0%
1%
(6)
(2)
0
267
0.2%
374
-6% (1,333)
34%
17
-5.7% (1,316)
Eros International Distribution LLP
-
-
-
-
-
-
-
-
Foreign
Digicine PTE Limited
Copsale Limited
-0.3%
(729)
-3%
(669)
35% 78,209
77% 17,869
-15%
-28%
(8)
(14)
Non controlling interests
0.6%
1,287
0.8%
188
48 Auditors' remuneration
As auditor
Statutory audit
Limited review
Tax audit
In other capacity
Other services (certification fees)
Reimbursement of expenses
Total
-3%
(677)
76% 17,600
-0.1%
(34)
Amount ` in lakhs
Year ended
31 March 2018
Year ended
31 March 2017
97
25
10
132
15
15
10
157
154
44
12
210
12
12
18
240
EROS IntERnatIOnal MEdIa lIMItEd 167
Corporate overview | ManageMent report | financial management
Notes
to the consolidated financial statements and other explanatory information
49 Based on the information available with the Company, there are no dues payable as at the year end to micro, small and medium enterprises as
defined in The Micro, Small & Medium Enterprises Development Act, 2006. This information has been relied upon by the statutory auditors of the
Company.
50 Post reporting date events
No adjusting or significant non-adjusting events have occurred between 31 March 2018 and the date of authorisation of these consolidated
financial statements
51 Authorisation of financial statements
The financial statement for the year ended 31 March 2018 (including comparatives) were approved by the board of directors on 23 May 2018.
As per our report of even date
For Chaturvedi & Shah
Chartered Accountants
Firm Registration No.: 101720W
Sd/-
Amit Chaturvedi
Partner
Membership No: 103141
Place: Mumbai
Date : 23 May 2018
For and on behalf of Board of Directors
Sd/-
Sunil Arjan Lulla
Executive Vice Chairman and Managing Director
(DIN: 00243191)
Sd/-
Sunil Srivastav
Non Executive Independent Director
(DIN: 00237561)
Sd/-
Farokh P. Gandhi
Chief Financial Officer
Place: Mumbai
Date : 23 May 2018
Sd/-
Abhishekh Kanoi
Vice President - Company Secretary
and Compliance Officer
168 annual REpORt 2017-18
Consolidated statements
NOTICE OF THE 24TH ANNUAL GENERAL MEETING
Regd. Office: 201, Kailash Plaza, Opp. Laxmi Industrial Estate, Off. Andheri Link Road, Andheri West, Mumbai 400 053, Maharashtra (India).
Corporate Office: 901/ 902, Supreme Chambers, Off. Veera Desai Road, Andheri West, Mumbai 400 053, Maharashtra (India).
Phone: +91 22 66021500 | Fax: +91 22 66021540 | Email: compliance.officer@erosintl.com | Website: www.erosintl.com
CIN: L99999MH1994PLC080502
NOTICE is hereby given that the 24th Annual General Meeting (AGM)
of the Members of Eros International Media Limited will be held on
Thursday, the 27th day of September 2018 at ‘The Club’, D N Nagar,
Andheri West, Mumbai 400 053, Maharashtra (India) at 2.00 P.M., to
transact the following business:
ORDINARY BUSINESS:
1.
To receive, consider and adopt:
a.
b.
the Audited Financial Statements of the Company for the
financial year ended 31 March 2018, together with the
Report of the Directors’ and Auditors thereon.
the Audited Consolidated Financial Statements of the
Company for the financial year ended 31 March 2018,
together with the Report of the Auditors thereon.
2.
To appoint a Director in place of Mrs. Jyoti Deshpande (DIN
02303283), who retires by rotation, and being eligible, offers
herself for re-appointment.
SPECIAL BUSINESS:
3. Appointment of Mr. Subramaniam Lakshminarayanan (DIN
07972480) as an Independent Director of the Company
To consider and if thought fit, to pass with or without modification(s),
the following resolution as a Special Resolution:
“RESOLVED THAT pursuant to the provisions of Sections 149,
152, and other applicable provisions, if any, of the Companies
Act, 2013 (“Act”) (as amended) read with Schedule IV to the said
Act and Companies (Appointment and Qualification of Directors)
Rules, 2014 and the provisions of SEBI (Listing Obligations and
Disclosure Requirements) Regulations 2015 (including any statutory
modification(s) or re-enactment(s) thereof for the time being in force),
Mr. Subramaniam Lakshminarayanan (DIN 07972480), Director of
the Company in respect of whom the Company has received a
notice, in writing from a member proposing his candidature for the
office of Director as per Section 160 of the said Act, be and is hereby
appointed as an Independent Director of the Company not liable
to retire by rotation, to hold office for a term of Five (5) consecutive
years from the conclusion of this Annual General Meeting till the
conclusion of Annual General Meeting of the Company to be held
in the Calendar Year 2023.
RESOLVED FURTHER THAT on the above appointment and as
per the resolution passed by the shareholders at the 21st Annual
General Meeting of the Company held on 3 September 2015,
Mr. Subramaniam Lakshminarayanan (DIN 07972480) be paid
remuneration by way of commission, in addition to the sitting
fees for attending the meetings of the Board of Directors and/or
Committees thereof, as the Board of Directors of the Company may
determine from time to time, not exceeding in aggregate 1% of Net
Profits of the Company for each financial year, as computed in the
manner as laid down in Section 198 of the said Act and Companies
(Appointment and Remuneration of Managerial Personnel) Rules,
2014 or any statutory modification(s) or re-enactments(s) thereof.”
4. Appointment of Mr. Sunil Srivastav (DIN 00237561) as an
Independent Director of the Company
To consider and if thought fit, to pass with or without modification(s),
the following resolution as an Ordinary Resolution:
“RESOLVED THAT pursuant to the provisions of Sections 149,
152, and other applicable provisions, if any, of the Companies
Act, 2013 (“Act”) (as amended) read with Schedule IV to the said
Act and Companies (Appointment and Qualification of Directors)
Rules, 2014 and the provisions of SEBI (Listing Obligations
and Disclosure Requirements) Regulations 2015 (including any
statutory modification(s) or re-enactment(s) thereof for the time
being in force), Mr. Sunil Srivastav (DIN 00237561), Director of the
Company in respect of whom the Company has received a notice,
in writing from a member proposing his candidature for the office
of Director as per Section 160 of the said Act, be and is hereby
appointed as an Independent Director of the Company not liable
to retire by rotation, to hold office for a term of Five (5) consecutive
years from the conclusion of this Annual General Meeting till the
conclusion of Annual General Meeting of the Company to be held
in the Calendar Year 2023.
RESOLVED FURTHER THAT on the above appointment and as
per the resolution passed by the shareholders at the 21st Annual
General Meeting of the Company held on 3 September 2015,
Mr. Sunil Srivastav (DIN 00237561) be paid remuneration by way
of commission, in addition to the sitting fees for attending the
meetings of the Board of Directors and/or Committees thereof, as
the Board of Directors of the Company may determine from time to
time, not exceeding in aggregate 1% of Net Profits of the Company
for each financial year, as computed in the manner as laid down
in Section 198 of the said Act and Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014, or any
statutory modification(s) or re-enactments(s) thereof.”
5. Material Related Party Transactions with Reliance Eros
Productions LLP
To consider and if thought fit, to pass with or without modification(s),
the following resolution as an Ordinary Resolution:
“RESOLVED THAT pursuant to the provisions of Section
188 and any other applicable provisions of the Companies
Act, 2013 (as amended) and applicable Rules made thereto,
and Regulation 23 of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (as amended) and applicable
provisions of the Foreign Exchange Management Act, 1999 and
rules, regulations and guidelines made there under and subject
to such approvals, consents, sanctions and permissions as
may be necessary from appropriate authorities, consent of the
Members of the Company be and is hereby accorded to the
Board of Directors of the Company (hereinafter referred to as
the “Board”, which term shall include any committee constituted
by the Board of Directors of the Company or any person(s)
authorized by the Board to exercise the powers conferred on
the Board of Directors of the Company by this Resolution) to
enter into material contracts/arrangements/transactions in the
normal course of business with Reliance Eros Productions LLP,
a subsidiary company and a Related Party under Section 2(76) of
the Companies Act, 2013 for production of cinematograph films
(in Hindi and other regional and foreign languages) and original
television and digital programmes for an estimated amount of
` 500 crores in each financial year on such terms and conditions as
determined by the Board of Directors from time to time.
RESOLVED FURTHER THAT the Board of Directors of the
Company be and are hereby authorized to decide upon the nature
and the value of transactions to be entered into with Reliance Eros
Productions LLP for production of cinematograph films (in Hindi
and other regional and foreign languages) and original television
and digital programmes within the maximum aforesaid limits.
RESOLVED FURTHER THAT the Board of Directors of the
Company be and are hereby authorized to alter/vary the terms and
conditions entered by the Company with Reliance Eros Productions
LLP for such period as may be determined by the Board from time
to time.
EROS IntERnatIOnal MEdIa lIMItEd 169
AGM Notice
RESOLVED FURTHER THAT the Board of Directors of the
Company be and are hereby authorized to sign and execute all
such deeds, applications, documents and writings that may be
required, on behalf of the Company and generally to do all such
acts, matters and things that may be necessary, proper, expedient
or incidental thereto for the purpose of giving effect to the aforesaid
resolutions.”
2.
The requirement to place the matter relating to appointment
of Auditors for ratification by Members at every Annual General
Meeting is done away vide notification dated 7 May 2018 issued
by the Ministry of Corporate Affairs. Accordingly, no resolution is
proposed for ratification of appointment of Auditors, who were
appointed for the period of Five (5) years in the 23rd Annual General
Meeting held on 28 September 2017.
6. Material Related Party Transactions with Eros Digital FZ LLC
3.
To consider and if thought fit, to pass with or without modification(s),
the following resolution as an Ordinary Resolution:
“RESOLVED THAT pursuant to the provisions of Section 188
and any other applicable provisions of the Companies Act, 2013
(as amended) and applicable Rules made thereto and Regulation
23 of SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 (as amended) and applicable provisions of the
Foreign Exchange Management Act, 1999 and rules, regulations
and guidelines made there under, and subject to such approvals,
consents, sanctions and permissions as may be necessary from
appropriate authorities, consent of the Members of the Company
be and is hereby accorded to the Board of Directors of the
Company (hereinafter referred to as the “Board”, which term shall
include any committee constituted by the Board of Directors of the
Company or any person(s) authorized by the Board to exercise
the powers conferred on the Board of Directors of the Company
by this Resolution) to enter into material contracts/arrangements/
transactions in the normal course of business with Eros Digital FZ
LLC, a group company and a Related Party under Section 2(76)
of the Companies Act, 2013 for the purpose of acquisition and
distribution of digital rights and other related expenses/matters for
an estimated amount of ` 300 crores in each financial year on such
terms and conditions as determined by the Board of Directors from
time to time.
RESOLVED FURTHER THAT the Board of Directors of the
Company be and are hereby authorized to decide upon the nature
and the value of transactions to be entered into with Eros Digital
FZ LLC for the purpose of acquisition and distribution of digital
rights and other related expenses/matters within the maximum
aforesaid limits.
RESOLVED FURTHER THAT the Board of Directors of the
Company be and are hereby authorized to alter/vary the terms and
conditions entered by the Company with Eros Digital FZ LLC for
such period as may be determined by the Board from time to time.
RESOLVED FURTHER THAT the Board of Directors of the
Company be and are hereby authorized to sign and execute all such
deeds, applications, documents and writings that may be required,
on behalf of the Company and generally to do all such acts, matters
and things that may be necessary, proper, expedient or incidental
thereto for the purpose of giving effect to the aforesaid resolutions.”
By Order of the Board of Directors
For Eros International Media Limited
Sd/-
Abhishekh Kanoi
Vice President- Company Secretary
and Compliance Officer
Membership No. – F9530
Date : 23 May 2018
Place: Mumbai
NOTES
1.
The Explanatory Statement pursuant to Section 102 of the
Companies Act, 2013 (“the Act”) in respect of the business under
Item Nos. 2 to 6 set out above and details of Directors seeking
appointment/re-appointment as required under SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015
(“SEBI Listing Regulations”) and Secretarial Standards on General
Meetings issued by the Institute of Company Secretaries of India
in respect of directors seeking appointment / re-appointment at
this Annual General Meeting (“AGM”/ “the Meeting”) are annexed
hereto.
170 annual REpORt 2017-18
A MEMBER ENTITLED TO ATTEND AND VOTE AT THE ANNUAL
GENERAL MEETING IS ENTITLED TO APPOINT A PROXY TO
ATTEND AND VOTE INSTEAD OF HIMSELF AND SUCH PROXY
NEED NOT BE A MEMBER OF THE COMPANY. A person shall not
act as Proxy for more than Fifty (50) members and holding in the
aggregate not more than Ten (10) percent of the total share capital
of the Company carrying voting rights. A person holding more than
Ten (10) percent of the total share capital of the Company carrying
voting rights may appoint a single person as a proxy and such
person shall not act as proxy for any other person or shareholder.
Proxies submitted on behalf of limited companies, societies
etc., must be supported by appropriate resolutions/authority, as
applicable.
4.
The instrument appointing the proxy (as per the format provided
with), in order to be effective, should be duly stamped, completed
and signed and deposited at the Corporate Office of the Company
not less than Forty Eight (48) hours before the commencement of
the Meeting.
5. MEMBER/PROXY SHOULD BRING THE ATTENDANCE SLIP
SENT HEREWITH, DULY FILLED IN, FOR ATTENDING THE
MEETING.
6. Corporate Members
intending
to send
their Authorized
Representatives to attend the Meeting pursuant to Section 113 of
the Companies Act, 2013 are requested to send a certified copy
of the relevant Board Resolution together with their respective
specimen signatures authorizing their representatives to attend
and vote on their behalf at the Meeting.
7.
The Register of Members and Share Transfer Books of the
Company will remain closed from Thursday, 20 September 2018
till Thursday, 27 September 2018 (both days inclusive).
8. Members holding shares in electronic form are requested to
intimate immediately any change in their address or bank mandates
to their Depository Participants with whom they are maintaining
their demat accounts. Members holding shares in physical form
are requested to advise any change of address immediately to
the Company/Registrar and Transfer Agent, M/s. Link Intime India
Private Limited.
9. Members must quote their Folio No./Demat Account No. and
contact details such as e-mail address, contact no. etc in all their
correspondence with the Company/ Registrar and Transfer Agent.
10. The Securities and Exchange Board of India (SEBI) has mandated the
submission of Permanent Account Number (PAN) by every participant
in securities market. Members holding shares in electronic form are,
therefore, requested to submit PAN to their Depository Participants
with whom they are maintaining their demat accounts. Members
holding shares in physical form can submit their PAN details to the
Company/ Registrar and Transfer Agent.
11. Relevant documents referred to in this Notice and the statement
pursuant to Section 102 of the said Act shall be open for inspection
at the Registered Office as well as at the Corporate Office of the
Company during business hours on all days except Saturdays,
Sundays and Public Holidays between 11:00 a.m. to 1.00 p.m.
upto the date of the Annual General Meeting. The Register of
Directors and Key Managerial Personnel and their shareholding
maintained under Section 170 of the said Act, and the Register of
Contracts and Arrangements in which the Directors are interested,
maintained under Section 189 of the said Act will be available for
inspection by the members at the AGM.
12. Every Member entitled to vote at the AGM of the Company can
inspect the proxies lodged at the Company at any time during the
AGM Notice
business hours of the Company during the period beginning Twenty
Four (24) hours before the time fixed for the commencement of
the AGM. However, a prior notice of not less than Three (3) days,
in writing of the intentions to inspect the proxies lodged shall be
required to be provided to the Company.
13. The Company has designated an exclusive email
ID
compliance.officer@erosintl.com for redressal of shareholders
complaints/grievances. For any investor related queries, you are
requested to please write to us at the above Email ID.
14. Members who are yet to encash their earlier dividend warrants
for the interim dividend in FY 2012-13 are requested to contact
the office of the Company Secretary / M/s Link Intime Private
Limited, Registrar and Transfer Agent (RTA) of the Company for
revalidation of the dividend warrants/issue of fresh demand drafts.
The Company has uploaded the details of unpaid and unclaimed
amounts lying with the Company as on 28 September 2017 (date of
the last Annual General Meeting) on the website of the Company at
www.erosintl.com and also on the website of the Ministry of
Corporate Affairs.
15. Members are requested to bring their Attendance Slip alongwith
unless any Member has requested for a physical copy of the same.
For Members who have not registered their E-mail addresses,
physical copies of the Notice convening the 24th AGM of the
Company, the Annual Report alongwith the process of e-voting
and the Attendance Slip, Proxy Form and Ballot Paper are sent in
the permitted mode.
21. Members may also note
the Notice convening
the
that
24th AGM and the Annual Report 2018 will also be available
on the Company’s website at www.erosintl.com and on the
website of Central Depository Services (India) Limited (CDSL)
at www.evotingindia.com for download. Even after registering
for e-communication, Members are entitled to receive such
communication in physical form, upon making a request for the
same, free of cost. For any communication, the shareholders may
also send request to compliance.officer@erosintl.com
22. The Certificate from Statutory Auditors of the Company certifying
that the Company’s Employee Stock Options Schemes are being
implemented in accordance with the SEBI (Share Based Employee
Benefits) Regulations, 2014, as amended, will be available for
inspection at the AGM.
copy of the Annual Report to the Annual General Meeting.
23. The route map showing directions to reach the venue of the
16. Members who wish to obtain any information on the Company
or view the financial statements for the Financial Year ended
the Company at
31 March 2018 may visit website of
www.erosintl.com or send their queries to the Company Secretary
at the Corporate Office of the Company atleast Ten (10) days
before the AGM.
17.
In terms of the applicable provisions of the said Act and Rules
thereto, the Company has obtained email addresses of its
Members and have given an advance opportunity to every
Member to register their email address and changes therein from
time to time with the Company for service of communications /
documents (including Notice of General Meetings, Audited
Financial Statements, Directors’ Report, Auditors’ Report and all
other documents) through electronic mode.
18.
In case of joint holders attending the AGM, the Member whose
name appears as the first holder in the order of names as per the
Register of Members of the Company will be entitled to vote.
Although, the Company has given opportunity for registration of
email addresses and has already obtained email addresses from
some of its Members, the Company once again requests its
Members, who have so far not registered, to register their e-mail
address(es) and changes therein from time to time, through any of
the following manner:
i. Email Intimation: By sending an email mentioning the
Name(s) and Folio Number/Client ID and DP ID to the
Registrar and Transfer Agent at
rnt.helpdesk@linkintime.
co.in and mumbai@linkintime.co.in or to the Company at
compliance.officer@erosintl.com
ii. Written Communication: By sending written communication
addressed to the Company Secretary and Compliance Officer
at the Corporate Office of the Company or to the Registrar
and Transfer Agent of the Company at M/s. Link Intime India
Private Limited, Unit – Eros International Media Limited, C-101,
247 Park, L.B.S. Marg, Vikhroli (West), Mumbai 400 083.
19. Details as stipulated under SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (as amended) and Secretarial
Standards on General Meeting (SS-2), in respect of the Directors
seeking appointment/re-appointment at the AGM, forms integral
part of the Notice. The Director have furnished the requisite
declarations for his/her re-appointment.
20. Electronic copy of the Notice convening the 24th AGM of the
Company, the Annual Report alongwith the process of e-voting
and the Attendance Slip, Proxy Form and Ballot Paper are being
sent to all the Members whose Email Ids are registered with the
Company /Depository Participants for communication purposes
24th AGM is annexed hereto.
24. Securities of listed companies would be transferred in dematerialised
form only, from a cut-off date, to be notified by SEBI. In view of
the same, members holding shares in physical form are requested
to consider converting their holdings to dematerialized form to
eliminate all risks associated with physical shares and for ease of
portfolio management. Members can contact the Company’s RTA
for assistance in this regard.
25. Voting
I. In compliance with provisions of Section 108 of the said Act,
Rule 20 of the Companies (Management and Administration)
Rules, 2014 as amended by the Companies (Management
and Administration) Amendment Rules, 2015 and Regulation
44 of the SEBI Listing Regulations, the Company is pleased to
provide its Members, the facility to cast their votes either for or
against each resolutions set forth in the Notice of the AGM using
electronic voting system from a place other than the venue of
the AGM (‘remote e-voting’), provided by Central Depository
Services (India) Limited (“CDSL”) and the business may be
transacted through such voting.
II. Any person, who acquires shares of the Company and becomes
a shareholder of the Company after dispatch of the Notice of
AGM and holds shares as of the cut-off date i.e. Thursday,
20 September 2018, may obtain the login ID and password by
sending a request at helpdesk.evoting@cdslindia.com. However,
if a member is already registered with CDSL for e-voting, then
he/she can use his/her existing user id and password/PIN for
casting the vote.
The instructions for e-voting are as follows:
i. The voting period begins on Sunday, 23 September 2018
(9.00 a.m.) and ends on Wednesday, 26 September 2018
(5.00 p.m.) During this period, Members of the Company,
holding shares either in physical form or in dematerialized
form, as on the cut-off date of Thursday, 20 September 2018
may cast their vote electronically. The e-voting module shall
be disabled by CDSL for voting thereafter
ii. The Members should log on to the e-voting website at
www.evotingindia.com.
iii. Click on Shareholders / Members Tab
iv. Now Enter your User ID
a. For CDSL: 16 digits beneficiary ID,
b. For NSDL: 8 Character DP ID followed by 8 Digits Client ID,
EROS IntERnatIOnal MEdIa lIMItEd 171
AGM Notice
c. Members holding shares in Physical Form should enter
prompted by the system.
Folio Number registered with the Company.
v. Next enter the Image Verification as displayed and Click on
Login.
vi. If you are holding shares in demat form and had logged on to
www.evotingindia.com and voted on an earlier voting of any
company, then your existing password is to be used
vii. If you are a first time user follow the steps given below:
PAN
For Members holding shares in Demat Form and
Physical Form
Enter your 10 digit alpha-numeric PAN issued by
Income Tax Department (Applicable for both demat
shareholders as well as physical shareholders)
• Members who have not updated their PAN with the
Company/Depository Participant are requested to
use the sequence number which is printed on Postal
Ballot / Attendance Slip indicated in the PAN field.
Dividend
Bank
Details
OR
Date of
Birth (DOB)
Enter the Dividend Bank Details or Date of Birth (in dd/
mm/yyyy format) as recorded in your demat account or
in the Company records in order to login.
• If both the details are not recorded with the
depository or Company, please enter the member id
/ folio number in the Dividend Bank details field as
mentioned in instruction (iv).
viii. After entering these details appropriately, click on
“SUBMIT” tab.
ix. Members holding shares in physical form will then directly
reach the Company selection screen. However, Members
holding shares in demat form will now reach ‘Password
Creation’ menu wherein they are required to mandatorily
enter their login password in the new password field.
Kindly note that this password is to be also used by
the demat holders for voting for resolutions of any other
company on which they are eligible to vote, provided
that company opts for e-voting through CDSL platform.
It is strongly recommended not to share your password
with any other person and take utmost care to keep your
password confidential.
x.
For Members holding shares in physical form, the details
can be used only for e-voting on the resolutions contained
in this Notice.
xi. Click on the EVSN for "Eros International Media Limited"
on which you choose to vote.
xii. On the voting page, you will see “RESOLUTION
DESCRIPTION” and against the same the option “YES/
NO” for voting. Select the option YES or NO as desired.
The option YES implies that you assent to the Resolution
and option NO implies that you dissent to the Resolution.
xiii. Click on the “RESOLUTIONS FILE LINK” if you wish to
view the entire Resolution details.
xiv After selecting the resolution you have decided to vote on,
click on “SUBMIT”. A confirmation box will be displayed.
If you wish to confirm your vote, click on “OK”, else to
change your vote, click on “CANCEL” and accordingly
modify your vote.
xv Once you “CONFIRM” your vote on the resolution, you
will not be allowed to modify your vote.
xvi. You can also take a print of the votes cast by clicking on
“Click here to print” option on the Voting page.
xvii If a demat account holder has forgotten the changed
password then Enter the User ID and the image verification
code and click on Forgot Password & enter the details as
172 annual REpORt 2017-18
xviii Members can also cast their vote using CDSL’s mobile
app m-Voting available for android based mobiles. The
m-Voting app can be downloaded from Google Play
Store. Apple and Windows phone users can download
the app from the App Store and the Windows Phone
Store respectively. Please follow the instructions as
prompted by the mobile app while voting on your mobile.
xix Note for Non – Individual Shareholders and Custodians
• Non-Individual shareholders (i.e. other than Individuals,
HUF, NRI etc.) and Custodian are required to log on
to www.evotingindia.com and register themselves as
Corporates.
• A scanned copy of the Registration Form bearing the
stamp and sign of the entity should be emailed to helpdesk.
evoting@cdslindia.com.
• After receiving the login details a Compliance User
should be created using the admin login and password.
The Compliance User would be able to link the
account(s) for which they wish to vote on.
• The list of accounts linked in the login should be mailed
to helpdesk.evoting@cdslindia.com and on approval of
the accounts they would be able to cast their vote.
• A scanned copy of the Board Resolution and Power of
Attorney (POA) which they have issued in favour of the
Custodian, if any, should be uploaded in PDF format in
the system for the scrutinizer to verify the same.
xx
In case you have any queries or issues regarding e-voting,
you may refer the Frequently Asked Questions (“FAQs”)
and e-voting manual available at www.evotingindia.com,
under help section or write an email to helpdesk.evoting@
cdslindia.com or contact Central Depository Services
(India) Limited (CDSL) at Helpdesk: 1800225533.
III. The facility for voting through ballot paper shall be made
available at the AGM and the Members attending the meeting
who have not cast their vote by remote e-voting shall be able to
exercise their right at the Meeting through ballot paper.
IV. A Member may participate in the AGM even after exercising his
right to vote through remote e-voting but shall not be allowed to
vote again at the AGM.
V. A person, whose name is recorded in the Register of Members
or in the Register of Beneficial Owners maintained by the
depositories as on the cut-off date shall only be entitled to
avail the facility of remote e-voting as well as voting at the AGM
through ballot paper.
VI. Mr. Makarand Joshi, Practicing Company Secretary,
(Membership No. 5533, COP: 3662), Partner of M/s Makarand
M. Joshi & Co. has been appointed as the Scrutinizer of the
Company to scrutinize the voting and remote e-voting process
in a fair and transparent manner.
VII. At the AGM, at the end of the discussion on the resolutions
on which voting is to be held, the Chairman shall, with the
assistance of the Scrutinizer, order voting through ballot paper
for all those Members who are present but have not cast their
votes electronically using remote e-voting facility.
VIII. The Scrutinizer shall immediately after the conclusion of voting
at the AGM, count the votes cast at the AGM and thereafter
unblock the votes cast through remote e-voting in the
presence of atleast two (2) witnesses not in the employment
of the Company. The Scrutinizer shall submit a consolidated
Scrutinizers Report of the total votes cast in favour of or against,
if any, and the results of the voting shall be declared not later
than Forty Eight (48) hours from the conclusion of the AGM of
the Company. The Chairman, or any other person authorised by
the Chairman, shall declare the result of voting forthwith.
AGM Notice the website of
IX. The Results declared alongwith the report of the Scrutinizer
shall be placed on
the Company at
www.erosintl.com and on the website of CDSL immediately after
the declaration of result by the Chairman or any person authorized
by him in writing and the same shall be communicated to BSE
Limited and National Stock Exchange of India Limited. The result
will also be displayed on the Notice Board of the Company at its
Corporate Office and Registered Office.
v.
vi.
Notes and instructions for voting through Ballot Paper
i.
ii.
iii.
Members desiring to cast their vote in Ballot Paper are requested to
execute the Ballot Paper as per the instructions stated therein and
send the same in the enclosed self-addressed postage prepaid
envelope.
The vote can be cast by recording the assent in the Column FOR
and dissent in the Column AGAINST by placing a tick mark (√) in
the appropriate column.
The Member may not use all the votes nor needs to cast all the
votes in the same way. Members have their sole discretion as to
voting.
iv. Members can download
the Ballot Paper
link
www.erosintl.com or seek a duplicate Ballot Paper from Link Intime
India Private Limited, the Registrar and Transfer Agent from their
office at C-101, 247 Park, L.B.S Marg, Vikhroli West, Mumbai -
400 083, fill in the details and send the same to the Scrutinizer.
from
the
Kindly note that the Members can opt only one mode of voting i.e.
either by Ballot Paper or e-voting. If you are opting for e-voting,
then do not vote by Ballot Paper and vice versa. However, in case
a Member has voted both in Ballot Paper as well as e-voting, then
voting done through e-voting shall prevail and voting done through
Ballot Paper will be treated as invalid.
You are requested to carefully read the instructions printed on the
Ballot Paper and return the paper duly completed, in the enclosed self-
addressed postage prepaid envelope, so as to reach the Scrutinizer
at C-101, 247 Park, L.B.S Marg, Vikhroli West, Mumbai - 400 083
on or before the close of working hours (5.00 p.m.) on Wednesday,
26 September 2018. No other request/ details furnished in the Self
Addressed envelope will be entertained.
vii. The Ballot Papers received after close of working hours
(5.00 p.m.), Wednesday, 26 September 2018 will be treated as
if the same has not been received from the Member.
By Order of the Board of Directors
For Eros International Media Limited
Sd/-
Abhishekh Kanoi
Vice President- Company Secretary
and Compliance Officer
Membership No. – F9530
Date : 23 May 2018
Place: Mumbai
EROS IntERnatIOnal MEdIa lIMItEd 173
AGM Notice
EXPLANATORY STATEMENT
(PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013)
As required by Section 102 of the Companies Act, 2013, the following Explanatory Statement sets out all material facts relating to the business
mentioned under Item Nos. 2, 3, 4, 5 and 6 of the accompanying Notice dated 23 May 2018:
Item No. 2:
The Board of Directors of the Company at its meeting held on 23 May 2018 and on recommendation of Nomination and Remuneration Committee
has re-appointed Mrs. Jyoti Deshpande (DIN 02303283) as Non-Executive Non-Independent Director of the Company, subject to the approval of the
Members.
Brief profile of Mrs. Jyoti Deshpande alongwith other details as required to be disclosed under the provisions of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 and Secretarial Standards- 2 issued by the Institute of Company Secretaries of India, are stated
at length below:
Name
DIN
Designation
Date of Birth
Age
Date of Appointment
Qualifications
Profile
Directorships held in other
companies (as on 23 May 2018)
Last remuneration drawn
Remuneration to be paid
Memberships/Chairmanships of
Committees of other companies
Number of Board Meetings
attended during FY 2017-18
Relationship with other Directors,
Key Managerial Personnel
Number of shares held in the
Company
Number of Stock Options
Mrs. Jyoti Deshpande
02303283
Non-Executive Non-Independent Director
16 December 1970
47 years
1 July 2012
Bachelor’s degree in Commerce and Economics, University of Mumbai
Mrs. Jyoti Deshpande has over 25 years of experience in media and entertainment across advertising, media
consulting, television and films. She has been part of the leadership team of Eros International since 2001 and as
Group CEO & MD since 2012, she has spearheaded Eros’ growth as a global leader in Indian filmed entertainment.
From 1 April 2018, Mrs. Deshpande has joined Reliance Industries to head the Media and Entertainment business
as President of the Chairman’s Office. In her new role at Reliance Industries, Mrs. Deshpande will lead the company’s
initiatives in Media and Entertainment to organically build and grow businesses around the content ecosystem such
as Broadcasting, Films, Sports, Music, Digital, Gaming, Animation etc., as well as integrate Reliance Industries’
existing media investments such as Viacom, Balaji Telefilms and Eros with a view to build, scale and consolidate the
fragmented $20 billion Indian M&E sector.
Mrs. Deshpande was featured in the prestigious Fortune India magazine’s 50 Most Powerful Women in Business
(2017/2015) which celebrates the journeys and triumphs of women who not only impact their organizations but are
also thought leaders in their industry.
•
•
•
•
•
` 1,15,95,672/- plus ` 5,98,50,000/- as perquisite value of ESOP (for FY 2017-18)
No Remuneration shall be paid to Mrs. Jyoti Deshpande, being Non-Executive Non-Independent Director of the
Company.
Nil
Eros International Plc (Isle of Man)
Network18 Media & Investments Limited
Balaji Telefilms Limited
Saavn Media Private Limited
IndiaCast Media Distribution Private Limited
Mrs. Jyoti Deshpande attended all the four (4) Board Meetings held during the financial year 2017-18.
Mrs. Jyoti Deshpande is not related to any Director nor any Key Managerial Personnel of the Company.
3,60,000 Equity Shares
2,11,160 Stock Options
It is proposed to seek approval of Members for re-appointment of Mrs. Jyoti Deshpande as Non-Executive Non-Independent Director of the Company
in accordance with applicable provisions of the Companies Act, 2013 and applicable Rules made thereto, as amended. Mrs. Jyoti Deshpande is not
disqualified from being appointed as Director in terms of Section 164 of the Companies Act, 2013.
Except for Mrs. Jyoti Deshpande who is interested in the resolution set out in Item No. 2 of the Notice, none of the other Directors, Key Managerial
Personnel’s or their relatives are concerned or interested in Item No. 2 above.
The Board recommends the Ordinary Resolution set out at Item No. 2 of the Notice for approval by the Members.
Item No. 3:
Based on the recommendation of Nomination and Remuneration Committee, the Board of Directors of the Company, pursuant to the provisions of
Section 161 of the Companies Act, 2013, had appointed Mr. Subramaniam Lakshminarayanan (DIN 07972480) as an Additional Independent Director
w.e.f. 14 November 2017.
In terms of the provisions of the above Section, Mr. Subramaniam Lakshminarayanan holds office upto the date of the ensuing Annual General Meeting.
The Company has received a notice, in writing from a member under Section 160 of the Companies Act, 2013 (as amended) proposing the candidature of
Mr. Subramaniam Lakshminarayanan for the office of Director of the Company.
174 annual REpORt 2017-18
AGM Notice Mr. Subramaniam Lakshminarayanan is not disqualified from being appointed as a Director in terms of Section 164 of the Companies Act, 2013 and
has given his consent to act as a Director.
The Company has received a declaration from Mr. Subramaniam Lakshminarayanan that he meets the criteria of independence as prescribed both
under sub-section (6) of Section 149 of the Companies Act, 2013 and under SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015. In opinion of the Board, Mr. Subramaniam Lakshminarayanan fulfils all conditions for his appointment as an Independent Director as specified
in the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended). Mr. Subramaniam
Lakshminarayanan is Independent of the Management and possesses appropriate skills, experience and knowledge inter alia, in the field of finance.
Brief profile of Mr. Subramaniam Lakshminarayanan alongwith other details as required to be disclosed under the provisions of the SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015 and Secretarial Standards- 2 issued by the Institute of Company Secretaries of India, are
stated at length below:
Name
DIN
Designation
Date of Birth
Age
Date of Appointment
Qualifications
Profile
Directorships held in other companies
Memberships/Chairmanships of
Committees of other companies
Number of Board Meetings attended
during FY 2017-18
Relationship with other Directors, Key
Managerial Personnel
Number of shares held in the Company
Number of Stock Options
Mr. Subramaniam Lakshminarayanan
07972480
Independent Director
19 May 942
76 Years
14 November 2017 (as an Additional Independent Non-Executive Director)
Master in Arts (M.A.)
Mr. Subramaniam Lakshminarayanan joined the Indian Audit and Accounts service in 1965. After holding
various positions in the Audit and Accounts Department, he retired as Deputy Comptroller and Auditor
General in 2002. During this period, he served in the Ministry of Personnel and Pensions as Additional
Secretary and earlier in the Railways and Ministry of Defense in Government of India. As a result of stints in
the various ministers, Mr. Subramaniam Lakshminarayanan has gained experience in cadre management,
staff welfare, purchases and contracts, financial advice and accounting as well as a good knowledge of
the relevant rules and regulations. He has also led offices comprising of as many as 1,500 employees and
has also provided direction, guidance and administrative framework.
Mr. Subramaniam Lakshminarayanan also has various International experience.
Nil
Nil
Mr. Subramaniam Lakshminarayanan was appointed on 14 November 2017 as an Additional Independent
Director and attended two (2) Board Meetings and Committee Meetings held after his appointment.
Mr. Subramaniam Lakshminarayanan is not related to any Director nor any Key Managerial Personnel.
Nil
Nil
Considering the vast expertise and knowledge, it will be in the interest of the Company that Mr. Subramaniam Lakshminarayanan be appointed as an
Independent Director of the Company for first term of Five (5) years.
Except for Mr. Subramaniam Lakshminarayanan who is interested in the resolution set out in Item No. 3 of the Notice pertaining to his appointment
as an Independent Director, none of the Directors or Key Managerial personnel’s (KMP) or their relatives are anyway concerned or interested in the
Resolution at Item No. 3 of the accompanying Notice.
In accordance with the recent amendments to SEBI Listing Regulations pursuant to Kotak Committee Recommendations, the Board recommends the
appointment of Mr. Subramaniam Lakshminarayanan by way of Special Resolution set out at Item No. 3 of the Notice for approval by the Members,
since the age of Mr. Subramaniam Lakshminarayanan is above 75 years.
Item No. 4:
Based on the recommendation of Nomination and Remuneration Committee, the Board of Directors of the Company, pursuant to the provisions of Section
161 of the Companies Act, 2013, had appointed Mr. Sunil Srivastav (DIN 00237561) as an Additional Independent Director w.e.f. 23 May 2018.
In terms of the provisions of the above Section, Mr. Sunil Srivastav holds office upto the date of the ensuing Annual General Meeting. The Company
has received a notice in writing from a member under Section 160 of the Companies Act, 2013 (as amended) proposing the candidature of
Mr. Sunil Srivastav for the office of Director of the Company.
Mr. Sunil Srivastav is not disqualified from being appointed as a Director in terms of Section 164 of the Companies Act, 2013 (as amended) and has
given his consent to act as a Director.
The Company has received a declaration from Mr. Sunil Srivastav that he meets the criteria of independence as prescribed both under
sub-section (6) of Section 149 of the Act and under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. In opinion of the Board,
Mr Sunil Srivastav fulfils all conditions for his appointment as an Independent Director as specified in the Companies Act, 2013 and SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015 (as amended). Mr. Sunil Srivastav is Independent of the Management and possesses
appropriate skills, experience and knowledge inter alia, in the field of finance.
EROS IntERnatIOnal MEdIa lIMItEd 175
AGM Notice Brief profile of Mr. Sunil Srivastav alongwith other details as required to be disclosed under the provisions of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and Secretarial Standards- 2 issued by the Institute of Company Secretaries of India, are stated at length below:
Name
DIN
Designation
Date of Birth
Age
Date of Appointment
Qualifications
Profile
Mr. Sunil Srivastav
00237561
Independent Director
21 March 1958
60 Years
23 May 2018 (as an Additional Independent Non Executive Director)
B.Sc (Honors) from Delhi University and Masters of Management Studies, F.M.S. from Benaras Hindu
University.
Mr. Sunil Srivastav aged 60 years was a Dy. Managing Director - Corporate Accounts Group in
State Bank of India. He was responsible for large corporate credit exposure including project and
infrastructure financing for the bank. He holds a proven track record in his various roles in different
capacities at SBI which include DMD - CSNB, CGM - Kolkata and GM - Delhi.
During his esteemed tenure at SBI, as DMD - CSNB, he has overseen initiating the Bank’s foray into digital
delivery of financial products and services including but not limited to areas like wealth management, an
e-wallet and the next generation mobile banking solution and initiation of SBI’s foray into new lines of
businesses including identification and negotiation with global JV partners.
As CGM - Kolkata at SBI, Mr. Srivastav was tasked with managing and growing operations of
a network of 1450 offices in Bengal, Sikkim and Andaman & Nicobar. His role included evolving
business strategy, improving operational efficiency, delivering the bank’s products and services to a
diverse base of wholesale and retail customers. He was at the time responsible for a workforce of
18,000 employees across different business verticals.
In his early years as GM - Delhi at SBI, he was in charge of the bank’s network in North India.
This included a specialised business vertical that was focused on mid-size corporate clients and an
assignment that involved growing the bank’s business in the difficult mountainous terrain in the State
of Uttarakhand.
Nil
Directorships held in other companies Paisalo Digital Limited
Memberships/Chairmanships of
Committees of other companies
Number of Board Meetings attended
during FY 2017-18
Relationship with other Directors, Key
Managerial Personnel
Number of shares held in the
Company
Number of Stock Options
Nil
Nil
Mr. Sunil Srivastav was appointed as an Additional Independent Non Executive Director at the Board
Meeting held on 23 May 2018 and has attended the said Board Meeting.
Mr. Sunil Srivastav is not related to any Director nor any Key Managerial Personnel.
Considering the vast expertise and knowledge, it will be in the interest of the Company that Mr. Sunil Srivastav be appointed as Independent Director
of the Company for first term of Five (5) years.
Except for Mr. Sunil Srivastav who is interested in the resolution set out in Item No. 4 of the Notice pertaining to his appointment as an Independent
Director, none of the Directors or Key Managerial personnel’s (KMP) or their relatives are anyway concerned or interested in the Resolution at Item No.
4 of the accompanying Notice.
The Board recommends the Ordinary Resolution set out at Item No. 4 of the Notice for approval by the Members.
Item No. 5:
Pursuant to the provisions of Section 188 and any other applicable provisions of the Companies Act, 2013 and applicable Rules made thereto and
Regulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended), all material transactions with related
party requires approval of the Shareholders of the Company through Ordinary Resolution and the related parties shall abstain from voting on such
resolutions. The Company’s transactions with its subsidiary company viz. Reliance Eros Productions LLP falls under the term “Material Transaction”
i.e. any transaction entered either individually or taken together with previous transactions during a financial year, exceeds Ten (10) percent of the
annual consolidated turnover of the Company. Reliance Eros Productions LLP is also a related party in terms of Section 2(76) of the Companies Act,
2013. Particulars of the Contracts/ arrangements/ transactions as envisaged under Companies (Meetings of Board and its Powers) Rules, 2014, as
amended, are as under:
(a) Name of the Related Party: Reliance Eros Productions LLP
(b) Nature of Relationship: Subsidiary Company
(c) Name of the Director or Key Managerial Personnel who is related, if any: Mr. Farokh P. Gandhi, representing as Designated Partner
176 annual REpORt 2017-18
AGM Notice (d) Nature, material terms, monetary value and particulars of the contract or arrangement: For production of cinematograph films (in Hindi
and other regional and foreign languages) and original television and digital programmes for an estimated amount of `500 crores in each financial
year on such terms and conditions as determined by the Board of Directors of the Company and partners of Reliance Eros Productions LLP from
time to time. The transactions with Reliance Eros Productions LLP are made in ordinary course of business and at arms length basis.
(e) Any other information relevant or important for the members to take a decision on the proposed resolution: The proposed related
party transaction are in accordance with the Related Party Transactions Policy of the Company and approved and recommended by the Audit
Committee and Board of Directors of the Company.
As per Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended), all entities falling under the
definition of related parties shall abstain from voting irrespective of whether the entity is a party to the particular transaction or not, wherein approval of
material related party transactions is sought from the shareholders. Accordingly, the Key Managerial Personnel of the Company as stated here in above
is concerned or interested in the said resolution set out at Item No. 5 of the Notice.
The Board recommends the Ordinary Resolution as set out at Item No. 5 of the Notice for approval by the Members.
Item No. 6:
Pursuant to the provisions of Section 188 and any other applicable provisions of the Companies Act, 2013 and applicable Rules made thereto and
Regulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended), all material transactions with related
party requires approval of the Shareholders of the Company through Ordinary Resolution and the related parties shall abstain from voting on such
resolutions. The Company’s transactions with its group company viz. Eros Digital FZ LLC falls under the term “Material Transaction” i.e. any transaction
entered either individually or taken together with previous transactions during a financial year, exceeds Ten (10) percent of the annual consolidated
turnover of the Company. Eros Digital FZ LLC is also a related party in terms of Section 2(76) of the Companies Act, 2013. Particulars of the Contracts/
arrangements/ transactions as envisaged under Companies (Meetings of Board and its Powers) Rules, 2014, as amended, are as under:
(a) Name of the Related Party: Eros Digital FZ LLC
(b) Nature of Relationship: Fellow Subsidiary Company
(c) Name of the Director or Key Managerial Personnel who is related, if any: Mrs. Rishika Lulla Singh is a Director of Eros Digital FZ LLC and
she is daughter of Mr. Kishore Arjan Lulla.
(d) Nature, material terms, monetary value and particulars of the contract or arrangement: Acquisition and distribution of digital rights and
other related expenses/matter for an estimated amount of ` 300 crores in each financial year on such terms and conditions as determined by the
Board of Directors from time to time. The transaction with Eros Digital FZ LLC are made in ordinary course of business and at arms length basis.
(e) Any other information relevant or important for the members to take a decision on the proposed resolution: The proposed related
party transaction are in accordance with the Related Party Transactions Policy of the Company and approved and recommended by the Audit
Committee and Board of Directors of the Company.
As per Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended), all entities falling under
the definition of related parties shall abstain from voting irrespective of whether the entity is a party to the particular transaction or not, wherein
approval of material related party transactions is sought from the shareholders. Accordingly, Mr. Kishore Arjan Lulla, Director of the Company as
stated here in above is concerned or interested in the said resolution set out at Item No. 6 of the Notice.
The Board recommends the Ordinary Resolution as set out at Item No. 6 of the Notice for approval by the Members.
Date : 23 May 2018
Place: Mumbai
Registered Office:
M/s. Eros International Media Limited
201, Kailash Plaza,
Opp. Laxmi Industrial Estate,
Off. Andheri Link Road,
Andheri West, Mumbai 400 053,
Maharashtra (India)
Corporate Office:
M/s. Eros International Media Limited
901/902, Supreme Chambers,
Off. Veera Desai Road, Andheri West,
Mumbai 400 053, Maharashtra (India).
Tel: +91 22 66021500
Fax No.: +91 22 66021540
Email: compliance.officer@erosintl.com
By Order of the Board of Directors
For Eros International Media Limited
Sd/-
Abhishekh Kanoi
Vice President- Company Secretary
and Compliance Officer
Membership No. – F9530
Registrar and Transfer Agent:
M/s. Link Intime India Private limited
Unit: Eros International Media Limited,
C-101, 247 Park, L.B.S Marg,
Vikhroli West, Mumbai 400 083.
Maharashtra (India)
Tel: +91 22 49186270
Fax No.: +91 22 49186060
Email: rnt.helpdesk@linkintime.co.in /
mumbai@linkintime.co.in
EROS IntERnatIOnal MEdIa lIMItEd 177
AGM Notice
ROUTE MAP FOR VENUE OF ANNUAL GENERAL MEETING OF EROS INTERNATIONAL MEDIA LIMITED
Venue: ‘The Club’, DN Nagar, Andheri West, Mumbai 400 053.
Prominent Landmark: Juhu Circle
178 annual REpORt 2017-18
AGM Notice Eros International Media Limited
CIN: L99999MH1994PLC080502
Registered Office Address: 201, Kailash Plaza, Opp. Laxmi Industrial Estate,
Off. Andheri Link Road, Andheri West, Mumbai-400 053, Maharashtra (India)
Corporate Office: 901/ 902, Supreme Chambers, Off Veera Desai Road, Andheri West, Mumbai 400 053, Maharashtra (India)
Phone: +91 22 66021500 | Fax: +91 22 66021540 | Email: compliance.officer@erosintl.com | Website: www.erosintl.com
ATTENDANCE SLIP
(To be presented at the entrance of the meeting hall)
24th Annual General Meeting on Thursday, 27 September 2018 at 2.00 P.M.
at 'The Club', D N Nagar, Andheri West, Mumbai - 400 053.
Folio No. ................................................... DP ID No.......................................................... Client ID No.......................................................................
Name of the Member .................................................................................................................................. Signature................................................
Name of the Proxyholder................................................................................................................................ Signature................................................
1. Only Member/Proxyholder can attend the Meeting.
2. Member/Proxyholder should bring his/her copy of the Annual Report for reference at the Meeting.
Proxy Form – Form MGT- 11
[Pursuant to Section 105(6) of the Companies Act, 2013 and Rule 19(3) of the Companies
(Management and Administration) Rules, 2014]
CIN
: L99999MH1994PLC080502
Name of the Company
: EROS INTERNATIONAL MEDIA LIMITED
Registered Office
: 201, Kailash Plaza, Opp. Laxmi Industrial Estate, Off. Andheri Link Road, Andheri West, Mumbai - 400 053,
Maharashtra (India)
Name of the member (s)
Registered Address
E-mail ID
Folio No/ Client ID
:
:
:
:
DP ID
:
I/We, being the member(s) of .................... shares of Eros International Media Limited, hereby appoint:-
1. ...………...............………… of …............................................................………………… having email id ….............………………… or failing him
2. ...………...............………… of …............................................................………………… having email id ….............………………… or failing him
3. ...………...............………… of …............................................................………………… having email id ….............………………… or failing him
And whose signature(s) are appended below as my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the
24th Annual General Meeting of the Company, to be held on Thursday, 27 September 2018 at 2.00 p.m. at 'The Club', D N Nagar, Andheri West,
Mumbai - 400 053, Maharashtra (India), and at any adjournment thereof in respect of such resolutions as are indicated below:
**I wish my above proxy to vote in the manner as indicated in the box below:
Resolutions
Sr.
No.
Optional
For Against
1
2
ORDINARY BUSINESS
To receive, consider and adopt (a) Audited Financial Statements of the Company for the year ended
31 March 2018 together with Report of the Directors' and Auditors thereon & (b) Audited Consolidated Financial
Statements for the year ended 31 March 2018 together with the Auditors Report thereon.
To appoint a Director in place of Mrs. Jyoti Deshpande (DIN 02303283), who retires by rotation, and being eligible, offers
herself for re-appointment.
SPECIAL BUSINESS
3 Appointment of Mr. Subramaniam Lakshminarayanan
Independent Director not
liable to retire by rotation, to hold office for a term of Five (5) consecutive years from the date of this
24th Annual General Meeting.
(DIN 07972480), as an
4 Appointment of Mr. Sunil Srivastav (DIN 00237561), as an Independent Director of the Company not liable to retire by
rotation, to hold office for a term of Five (5) consecutive years from the date of this 24th Annual General Meeting.
5 Approval of Material Related Party Transactions between the Company and Reliance Eros Productions LLP
6 Approval of Material Related Party Transactions between the Company and Eros Digital FZ LLC
Signed this................................. day of .................... 2018
..................................................
Signature of shareholder
Affix
Revenue
Stamp
..................................................
Signature of First Proxy Holder
..................................................
Signature of Second Proxy Holder
..................................................
Signature of Third Proxy Holder
Note:
1)
2)
3)
4)
5)
6)
This form of proxy in order to be effective should be duly completed and deposited at the Corporate Office of the Company, not less than 48
hours before the commencement of the Meeting.
A Proxy need not be a member of the Company.
A person can act as a proxy on behalf of members not exceeding Fifty (50) and holding in the aggregate not more than 10% of the total share capital
of the company carrying voting rights. A member holding more than 10% of the total share capital of the Company carrying voting rights may appoint
a single person as proxy and such person shall not act as a proxy for any other person or shareholder.
**This is optional. Please put a (√) in the appropriate column against the resolutions indicated in the Box. If you leave the ‘For’ or ‘Against’ column blank
against any or all the resolutions, your Proxy will be entitled to vote in the manner as he/she thinks appropriate.
Appointing a proxy does not prevent a member from attending the meeting in person if he so wishes.
In the case of joint holders, the signature of any one holder will be sufficient, but names of all the joint holders should be stated.
Credits
Corporate Information
Board of Directors
Mr. Dhirendra Swarup,
Non - Executive Chairman & Independent Director
DIN: 02878434
Mr. Sunil Arjan Lulla,
Executive Vice Chairman & Managing Director
DIN: 00243191
Mr. Kishore Arjan Lulla,
Executive Director
DIN: 02303295
Mr. Rakesh Sood,
Non-Executive Independent Director
DIN: 07170411
Mrs. Jyoti Deshpande,
Non-Executive, Non-Independent
DIN: 02303283
Mr. S. Lakshminarayan,
Non-Executive Independent Director
DIN: 07972480
Mr. Sunil Srivastav,
Non-Executive Independent Director
DIN: 00237561
Mr. Naresh Chandra,
Non-Executive Chairman, Independent Director
DIN: 00015833
(Mr. Naresh Chandra ceased to be the Chairman and
Non-Executive Independent Director upon his sudden
demise on 9 July, 2017)
cer (India)
Group Chief Financial Offi cer (India)
rch 2018)
Mr. Farokh P. Gandhi (w.e.f. 9 March 2018)
Mr. Dinesh Modi (upto 8 March 2018)
018)
Secretary &
Vice President - Company Secretary &
Compliance Offi cer
ecember 2017)
Mr. Abhishekh Kanoi (w.e.f. 15 December 2017)
Mrs. Dimple Mehta (upto 14 December 2017)
ember 2017)
Statutory Auditors
M/s. Chaturvedi & Shah
Chartered Accountants
(Firm Registration No. 101720W)
Corporate Identifi cation Number (CIN):
L99999MH1994PLC080502
Bankers
State Bank of India (Lead Bank)
IDBI Bank Limited
Indian Overseas Bank
Punjab National Bank
Oriental Bank of Commerce
Union Bank of India
Bank of Baroda
Dena Bank
Corporate Offi ce
901/902, Supreme Chambers
Off. Veera Desai Road
Andheri West
Mumbai - 400 053
Maharashtra (India)
Tel: +91 22 66021500; Fax: +91 22 66021540
Email: compliance.offi cer@erosintl.com
Website: www.erosintl.com
Registrar & Share Transfer Agent
M/s. Link Intime India Private Limited
Unit: Eros International Media Limited
C 101, 247 Park
LBS Marg, Vikhroli West
Mumbai 400 083
Maharashtra (India)
CIN: U67190MH1999PTC118368
Tel: +91 22 4918 6000; Fax: +91 22 4918 6060
E-mail: rnt.helpdesk@linkintime.co.in,
mumbai@linkintime.co.in
Website: www.linkintime.co.in
EROS INTERNATIONAL MEDIA LIMITED
CIN: L99999MH1994PLC080502
201, Kailash Plaza, Opp. Laxmi Industrial Estate,
Off. Andheri Link Road, Andheri West,
Mumbai 400 053, Maharashtra (India).
Tel: + (91 22) 66021500, Fax: + (91 22) 66021540
Email: compliance.offi cer@erosintl.com
Website: www.erosintl.com