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As on: Dec 06, 2020 12:01 AM
EIH Ltd
Industry: Hotels
BSE Code ISIN Demat Book Value(Rs) NSE Symbol Mar.Cap(Rs Cr.) P/E(TTM) EPS(TTM) Face Value(Rs)
500840 INE230A01023 43.1413073 EIHOTEL 6150.46 0 0 2

The Board presents the Seventieth Annual Report together with the Audited Financial Statement and the Auditor's Report for the Financial Year ended on 31st March 2020.

Financial Highlights

The financial highlights are set out below:

( Rs in million)

Particular

Standalone

Consolidated

Year 2019-20 2018-19 2019-20 2018-19
Total Revenue 14,343.08 16,272.62 16,746.94 18,796.07
Earnings Before Interest, Depreciation, Taxes, Amortisations and Exceptional items (EBIDTA) 3,094.21 4,061.38 3,686.98 4,747.05
Finance Costs 495.15 463.60 556.05 504.41
Depreciation 1,342.03 1,230.08 1,464.61 1,325.57
Exceptional Income/ (Expenditure) (166.07) (730.66) (4.67) (730.66)
Share of Profit of Associate and Joint Venture Companies - - (1.44) 122.96
Profit Before Tax 1,090.96 1,637.04 1,660.21 2,309.37
Current Tax 209.91 610.29 372.39 862.25
Deferred Tax (363.62) (106.63) (363.61) (42.45)
Net Profit for the year 1,244.67 1,133.38 1,651.43 1,489.57
Other Comprehensive Income / (Loss) for the year, net of tax (23.29) (8.86) 550.82 (16.32)
Total Comprehensive Income 1,221.38 1,124.52 2,202.25 1,473.25
Less: Share of profit of Non-Controlling Interest - - 173.09 170.86
Total Comprehensive Income attributable to Group - - 2,029.16 1,302.39
Profit for the Year attributable to the Group - - 1,488.17 1,315.41
Balance Brought Forward 4,861.01 4,468.78 5,398.59 4,910.16
Adjustment for new Ind AS 6.69 (112.14) 8.09 (112.04)
Accumulated Balance 6,112.37 5,490.02 6,894.85 6,113.53
Adjusted to Opening Retained Earnings - - - (81.78)
Final Dividend paid for the year 2018-19 (514.41) (514.41) (514.41) (514.41)
Dividend Tax (72.25) (105.74) (91.34) (105.73)
Transfer to General Reserve - - - -
Other Comprehensive Income / (Loss) for the year, net of tax (23.29) (8.86) (52.53) (13.02)
Balance carried over 5,502.42 4,861.01 6,236.57 5,398.59

Directors' Responsibility Statement

In accordance with the provisions of Section 134 (5) of the Companies Act, 2013 ("the Act") and, based upon representations from the Management, the Board states that:

a) in preparing the Annual Accounts, applicable accounting standards have been followed and there are no material departures;

b) the Directors have selected accounting policies, applied them consistently and made judgments and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year;

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

d) the Directors have prepared the Annual Accounts of the Company on a "going concern" basis;

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

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

Performance

The annexed Management Discussion and Analysis forms a part of this report and covers, amongst other matters, the performance of the Company during the Financial Year 2019-20 as well as the future outlook.

Business Responsibility Report

In accordance with regulation 34(2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), the Business Responsibility Report describing the initiatives taken by the Company from the environmental, social and governance perspective is attached and forms part of this Report.

Corporate Governance Report

In accordance with regulation 34(3) read with Schedule V(C) of the listing regulations, the report on Corporate Governance along with the certificate from Practicing Company Secretary is attached and forms part of this Report.

Dividend

In view of the prolonged lockdown and consequent travel restrictions to avoid spread of COVID-19 pandemic imposed by the Government of India as well other countries globally almost all business segments i.e. Corporate, Leisure, MICE and Direct business were severely impacted. In these unforeseen and uncertain times, it is difficult to predict when business conditions will normalise. Therefore, in order to conserve cash and ensure liquidity for the operations for the Financial Year 2020-21, the Board of Directors decided not to recommend any dividend to the shareholders for the Financial Year 2019-20.

Board Meetings

During the year, Five Board Meetings were held on 30th May 2019, 13th August 2019, 5th November 2019, 24th January 2020 and 26th March 2020 respectively.

Directors and Key Managerial Personnel

The Shareholders, by special resolutions passed on 11th July 2019, approved reappointment of Mr. Lakshminarayan Ganesh (DIN: 00012583), Mr. Rajeev Gupta (DIN: 00241501) and Mr. Sudipto Sarkar (DIN: 00048279) as Non-executive Independent Directors on the Board of the Company for a second term of 5 (five) consecutive years from the date of expiry of their respective current term, not liable to retire by rotation.

The Nomination and Remuneration Committee and the Board at their respective meetings held on 28th May 2019 and 30th May 2019, noted that the above Non-executive Independent Directors are highly renowned professionals drawn from diverse fields, who bring with them a wide range of skills and experience to the Board, which enhances the quality of the Board's functioning and its decision making process. The Company and the Board have immensely benefittedfrom their vast experience, knowledge and strategic insights on various matters relating to Company's business. Considering the enormous contributions of the Directors to the functioning and performance of the Company, the Board was of the unanimous view that it will be in the best interest of the Company to re-appoint them as Non-executive Independent Directors for a second term of 5 (five) consecutive years.

Taking into consideration the outcome of the performance evaluation report of the aforesaid three independent directors, the Board of Directors, on the recommendation of the Nomination and Remuneration Committee, approved and recommended to Shareholders re-appointment of Mr. Lakshminarayan Ganesh, Mr. Rajeev Gupta and Mr. Sudipto Sarkar as Non-executive Independent Directors on the Board of the Company, not liable to retire by rotation, for a second term of 5 (five) consecutive years from the respective expiry date of their current term.

The Shareholders, by special resolutions passed on 11th July 2019, approved re-appointment and remuneration of Key Managerial Personnel of the Company, namely, Mr. Vikramjit Singh Oberoi (DIN: 00052014), Managing Director and Chief Executive Officer and Mr. Arjun Singh Oberoi (DIN: 00052106), Managing Director-Development for a term of 5 (five) years with effect The Shareholders, by an ordinary resolution passed on 12th October 2019, on the recommendation of Nomination and Remuneration Committee and the Board, approved appointment of Mr. Sanjay Gopal Bhatnagar (DIN: 00867848) as a Non-executive Independent Director on the Board of the Company for a term of 5 (five) consecutive years with effect from 27th August 2019, not liable to retire by rotation, in place of Mr. Santosh Kumar Dasgupta.

At the first meeting of the Board of Directors for the Financial Year 2020-21 held on 26th June 2020 the Independent Directors have confirmed, as required under sub section (7) of Section 149 of the Act read with Regulation 25(8) of the listing regulations, that they meet the criteria of independence required under sub-section (6) of Section 149 of the Act and clause (b) of sub-regulation (1) of Regulation 16 of the listing regulations.

The Board, after undertaking due assessment of the veracity of the declaration submitted by the Independent Directors under sub section (6) of Section 149 of the Act read with sub-regulation (9) of Regulation 25 of the listing regulations, was of the opinion that the Independent Directors meet the criteria of independence.

Mr. Vikramjit Singh Oberoi retires by rotation at the forthcoming Annual General Meeting and being eligible, offer himself for re-appointment. The Directors recommend re-appointment of Mr. Vikramjit Singh Oberoi as a Director on the Board.

Corporate Social Responsibility

The Company's Corporate Social Responsibility (CSR) Policy formulated in accordance with Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 can be accessed on the Company's website www.eihltd.com The Annual Report on Corporate Social Responsibility activities for the Financial Year 2019-20 is given in Annexure 1 and forms a part of this Report. The Annexure also gives the composition of the CSR Committee. In addition to the mandatory CSR spend in accordance with the Act, during the year, the Company's Hotels and Service Units have also taken the following CSR initiatives:

The Oberoi Grand, Kolkata supports Sasha, an NGO which works with local artisans for the upliftment and self-employment of women by purchasing hand-crafted products made by them. Hotel also donate discarded uniforms, bath & bed linen, F&B linen and newspapers. The hotel also invited Ankur Kala, Shri Rajchandra Aatma Tatva Research Centre and Sarada Seva Sangha NGO's working for the rehabilitation and empowerment of marginalised and economically challenged women and children and physically challenged women to showcase and sell their products viz. batik, tie-n-dye, tailoring, applique, block printing, silk-screen, handmade gift packets, candles, bags, jute, batik, embroidery, tailoring and stationery products. The hotel had also organised breakfast on 28th December 2019 for 1,200 children in the Jungle Crows ‘Khelo Rugby' 10 day winter camp which was coordinated by Mr. Paul Walsh and Chef Shaun Kenworthy for economically deprived sections of the city who are trained to play Rugby.

The Oberoi, Udaivilas, Udaipur employees visited Mother Teresa Orphanage and Asha Dham Ashram for the poor, sick, mentally challenged and old people and supports them by taking care of their daily needs. Visits were also organised to government primary school, local vendors/kiosks, where importance of hygiene was demonstrated and toiletries were distributed. Collaterals in all the guest rooms are placed and donations given by guests are collected and sent to CRY (Child Relief and You). As a green initiative, the hotel also organised, sapling plantation drives at Fatehsagar lake area.

The Oberoi and Trident Nariman Point, Mumbai donated community kitchen equipment and utensils to Bal Jeevan Trust. Bal Jeevan Trust works relentlessly to improve nutrition and education for street children in the city of Mumbai. The hotels organized a hotel visit for the children of The Aditya Birla Integrated Trust for a day of fun and learning. The children spent the day learning about Hotel operations of different departments. They enjoyed their visit to the flower in an interactive cooking session on basic methods of cooking. Representatives from The National Institute for the Blind (NAB) displayed their talent and creativity through an exhibition and sale of hand - made ‘Rakhi' and other small gift items. The hotels organized a Shop of a Cause Exhibition for all employees in the cafeteria. The decorative and gift items were hand made by volunteers from various Non-Profit Organizations such as Krupakabi, Welfare for Stray Dogs, DEEDS, Women Trust of India, Aseema Foundation and Dharma Bharti Foundation. All contributions generated from the sale are utilized by the Non - Profit organizations to uplift the lives of many. The hotels organized a yearly charity drive to encourage team members to come forward and donate household items/ clothes/ books/ toys which are no longer of use to them.

Trident Bandra Kurla Complex, Mumbai seeks to raise awareness towards the need for youth education, healthcare and safety needs. Through the Youth Career Initiative (YCI) Program, we aim to not only provide high-quality vocational education to underprivileged needful youth, but to also create an environment conducive to their overall growth and development. Ten youth aspirants were trained across various departments and functions in the hotel namely - Housekeeping, Kitchen, F&B Service and Front Office.

The Oberoi, Bengaluru nurtures physically challenged girls and economically challenged senior citizens in association with Cheshire Home Trust. The hotel team hosts a lunch for the children, care givers and supervisors at the Home. Girls and their teachers were invited for a fun afternoon followed by lunch at the hotel. The hotel team also organized interactive and engaging activities for the children of the home. Former resident of this home is employed with the reservations back office team. Hotel also work with Friends in Need Society-this NGO works with orphanages and home for the elderly. Christmas fete was organized where donated items are sold to invitees and funds raised for an old age home. The hotel contribute 250 pieces of festive tea cakes for their bake sale. The hotel also works with the Association of People with Disability, Bangalore Chapter working for underprivileged people with disability. The hotel supplies lunch for their Bangalore residents. The bakery team donates all breakfast pastries and rolls which are not consumed during each morning's breakfast service. During the pandemic caused by COVID-19 virus, the hotel and its kitchen and support teams arranged both lunch and dinner boxes for the staff of St' Philomena's Hospital

The Oberoi Vanyavilas, Ranthambore was involved in the welfare of local communities by providing life insurance and basic equipment to forest guards in Ranthambore. The hotel also promotes "Dhonk", a socially responsible enterprise that aims at creating sustainable jobs for local villagers through art and crafts. The rainfall pattern has changed significantly at Sawai Madhopur and has resulted in shortage of water in the jungle and the natural water bodies tend to dry. The hotel has assisted the forest department by filling water hole behind the hotel for the wild animals to drink water. On the recommendation of the Chief Conservator of Forest, the hotel recognized the exceptional work done by the forest guards at the Ranthambore National Park and in other parks of India. The hotel visits the underprivileged and disabled children and arranges refreshments, gifts and a little party of song and dance.

The Oberoi, Gurgaon and Trident, Gurgaon engage with communities at various levels, supporting initiatives in education, community development, skill development and basic needs of food. The hotels are associated with Happy School, which is a school for underprivileged children. Both hotels provide mid-day meal of high-protein soya biryani once a week. Executives also contribute by volunteering to teach or donate toys. The hotels are also associated with Ritinjali, which is a volunteer-based organization that works with the marginalized communities in education and development related projects. The hotels provide basic food and essentials like rice, wheat flour and oil once a month. The hotels hire differently abled persons from Pallavanjali Institute for the Actualization of Individual Potential (PIAP) which is an NGO that focus on the needs of children and youth with disabilities. In the area of skill development and livelihood generation, the hotels are partnered with Youth Career Initiative (YCI) which is an innovative, high-impact approach to combating global youth unemployment. It works with young people who are unlikely to have a viable route into legitimate employment and improve their situation without external help. This is a 6 months programme and every year candidates are trained by the hotels. The candidates are paid a stipend and transportation during the training period. A blood donation camp was organised in association with Sri Sathya Sai Sanjeevani Hospital and the Rotary Blood Bank.

Maidens Hotels, Delhi employees visited Palna and Mother Teresa Home where breakfast and gifts were distributed. A blood donation camp was organised where the employees also donated blood.

The Oberoi, New Delhi organized blood donation camps in association with the Rotary Blood Bank and the Sri Sathya Sai Sanjeevani Centre for Child Heart Care to create awareness about the benefits of safe and regular blood donation. The hotel numerous underprivileged citizens through Goonj, an NGO. Several team members donated woolens, blankets, shawls, shoes in addition to other items of basic necessity that are used to protect against the winter cold.

Audit Committee

The composition of the Audit Committee is as under:

• Mr. Sudipto Sarkar - Independent Director & Chairperson

• Mr. Lakshminarayan Ganesh - Independent Director

• Mr. Anil Kumar Nehru - Independent Director

• Mr. Rajeev Gupta Independent Director

• Mr. Shib Sanker Mukherji Executive Vice Chairman; and

• Mr. Arjun Singh Oberoi - Managing Director, Development

For other details relating to the Audit Committee, please refer to the Corporate Governance Report.

Company's Policy on Directors Appointment and Remuneration and Senior Management Personnel Appointment and Remuneration

The Company's Policy on Directors Appointment and Remuneration Policy (revised), 2019, ("Director Appointment Policy") and Senior Management Appointment and

Remuneration Policy ("Senior Management Policy") formulated in accordance with Section 178 of the Act read with regulation 19(4) of the listing regulations can be accessed on the Company's website www.eihltd.com.

The salient features of the "Directors Appointment Policy" are as under:

The Policy aims to engage Directors (including non-executive and independent non-executive directors) who are highly skilled, competent and experienced persons within one or more fields of business, finance, accounting, law, management, sales, marketing, administration, corporate governance, technical operations or other disciplines related to the business of the Company. The Directors shall be able to positively carry out their supervisory role on the management and the general affairs of the Company;

• assessing the individual against a range of criteria including but not limited to industry experience, background, and other qualities required to operate successfully in the position with due regard to the benefits of diversity of the Board;

• the extent to which the individual is likely to contribute to the overall effectiveness on the Board and work constructively with existing Directors; the skills and experience the individual brings to the role and how these will enhance the skill sets and experience of the Board as a whole;

• the nature of positions held by the individual including directorships or other relationships and the impact they may have on the Directors ability to exercise independent judgment; the time commitment required from a Director to actively discharge his or her duties to the Company.

The Salient features of the "Senior Management Policy" are as under:

• The objective of this Policy is to provide a framework and set standards for the appointment, remuneration and termination of Key Managerial Personnel (KMP) and the Core Management Team (within the Senior Management Personnel) who have the capacity and responsibility to lead the Company towards achieving its long term objectives, development and growth;

• Appointment & Remuneration of Key Managerial Personnel and Core Management Team are aligned to the interests of the Company and its Shareholders within an appropriate governance framework;

• Remuneration is structured to align with the Company's interests, taking into account the Company's strategies and risks;

• Remuneration is linked to individual and Company performance, which, in turn, impacts the quantum of variable pay;

• Remuneration is designed to be competitive within the hospitality industry or other industries in general for applicable roles;

• Executives performing similar complexity of jobs are paid similar compensation.

The remuneration paid to Senior Management personnel is categorised under the following major heads:

Fixed Salary: This includes basic salary, other allowances, perquisites and retirement benefits;

Variable Salary: This includes variable pay linked to Company and Individual performance.

Energy Conservation Measures

During the year, energy conservation measures taken by the Company include: replacement of conventional lamps with energy efficient LED lamps with inclusion of smart controls; replacement of old chiller with energy efficient chiller; replacement of old split air conditioners with inverter based units; improving thermal insulation of guest tents; installation of energy efficient EC motors in ventilation installation of waste heat recovery equipment; installation of VFD for air compressors and chilled water pumps; carrying out over hauling works for cooling towers and heat exchangers; installation of water flow optimizers in wash basin taps and installation of water efficient eco washer based WCs.

Furthermore, conservation measures in the form of tight operational control of lighting and other equipment, regulation of air conditioning set points according to ambient temperatures, taking guest floors out of order during low occupancy and optimization of laundry and boiler operation were continued. Energy audit of plant and machinery along with thermography of electrical panels were carried out for identifying additional measures of saving energy. Operational measures include setting of benchmarks with respect to the current year with targets for increased savings, initiatives by energy conservation committees comprising of cross functional groups, close monitoring and performance evaluation of plant and machinery by conducting regular self-audit and up grading of plant room equipment. With various energy conservation measures taken in the Financial Year 2019-20, the Company reduced overall energy consumption by about 3.25 million Kwh which resulted in a reduction of carbon dioxide emissions by about 1.7 million kg in comparison to the previous financial year.

Actions planned for the next year are replacement of remaining conventional lamps with energy efficient LED lamps; upgrading of sewage treatment plants; installation of new energy efficient pumps; upgrading chillers with VFD retrofitting; replacement of old chillers with more energy efficient chillers; installation of heat pumps in place of conventional hot water boilers; replacement of cooling towers with more efficient cooling towers; installation of water efficient eco washer based water closets and installation of water flow optimizer in taps.

Foreign Exchange Earnings and Outgo

During the Financial Year 2019-20, the foreign exchange earnings of the Company amounted to Rs 4,685.10 million as compared to Rs 5,144.68 million in the previous year.

The expenditure on foreign exchange during the Financial Year was Rs 697.01 million as compared to Rs 598.28 million in the previous year.

Auditor and Auditor's Report

At the 67th Annual General Meeting of the Company held in the year 2017, the Shareholders had approved the appointment of M/s. Deloitte, Haskins & Sells LLP, Chartered Accountants, (FRN 117366 W/W 100018) ("Deloitte") as the Statutory Auditors of the Company to hold office for 5 (five) consecutive years.

The Report of Auditors does not contain any qualification, reservation or adverse remarks.

Secretarial Auditors

In accordance with the provisions of Section 204 of the Act, M/s. JUS & Associates were appointed as the Secretarial Auditors of the Company for the Financial Year ended on 31st March 2020. The Secretarial Audit Report submitted by the Secretarial Auditors does not contain any qualification, reservation or adverse remarks. The Secretarial Auditor Report is annexed and forms part of the Annual Report. The Certificate Non-Disqualification of Directors from the Practicing Company Secretary pursuant to Regulation 34(3) and Schedule V Para C clause (10)(i) of the listing regulations is also annexed and forms part of this report.

Secretarial Standards

During the year, the Company has complied with the applicable Secretarial Standards.

Related Party Transactions

The contracts, arrangements and transactions entered into by the Company during the

Financial Year with related parties were in the ordinary course of business and are on an arm's length basis. During the year, the Company has not entered into any contract, arrangement or transaction with Related Parties that could be considered material in accordance with the Related Party Transaction Policy of the Company. The Policy on Related Party Transactions approved by the Board can be accessed on the Company's website www.eihltd.com. The details of Related Party Transactions are set out in Note nos.43 and 43 to the Standalone and Consolidated Financial Statements respectively.

Extract of Annual Return

The Extract of the Annual Return for the Financial Year ended on 31st March 2020 in Form MGT-9 is annexed as Annexure 2.

Loan, Guarantees or Investments

Particulars of loans given, investment made, guarantees given, if any, and the purpose for which the loan, guarantee and investment will be utilised are provided in the Standalone Financial Statement in Note nos. 8 & 44.

Deposits

During the year, the Company did not accept any deposits from the public.

Vigil Mechanism / Whistleblower Policy

In accordance with the Section 177(9) of the Act and rules framed thereunder read with Regulation 22 of the Listing Regulations, the Company has a Whistleblower Policy in place for its Directors and Employees to report concerns about unethical behaviour, actual or suspected fraud or violation of the Company's Code of Conduct, "The Oberoi Dharma". The Policy provides for protected disclosures for the Whistleblower. Disclosures Officer can be made through -mail or letter to the Whistle Audit Committee. The Whistleblower Policy can be accessed on the Company's website www.eihltd.com.

During the year ended on 31st March 2020, one complaint was received from an ex- employee of the Company's business unit, Oberoi Flight Services, Chennai against the General Manager of the unit. The complaint was thoroughly investigated by the Whistle Officer and the Whistle Committee. The Report of the Whistle Officer and the Whistle Committee and its recommendation was placed before the Audit Committee. The Audit Committee deliberated and approved the recommendation of the Whistle Committee for Management action. The Management took necessary action to the satisfaction of the Audit Committee.

Subsidiaries, Associates and Joint Ventures Subsidiaries/Joint Ventures

The Company has three Indian subsidiaries which are also Joint Ventures, namely, Mumtaz Hotels Ltd, Mashobra Resort Ltd and Oberoi Kerala Hotels and Resorts Ltd. The Company's overseas subsidiaries are i) EIH Flight Services Ltd, Mauritius; ii) EIH International Ltd, BVI; iii) EIH Holdings Ltd, BVI; iv) EIH Investments NV Netherlands; v) EIH Management Services BV, Netherlands; vi) PT Widja Putra Karya, Indonesia; vii) PT Waka Oberoi Indonesia, Indonesia and viii) PT Astina Graha Ubud, Indonesia.

In accordance with regulation 16 read with regulation 24 of the listing regulations, the Board at its meeting held on 30th May 2019, on the recommendation of the Audit Committee, identified the following unlisted subsidiary companies of the Company as "material subsidiary" for the Financial Year 2019-20 (based on Income/Net worth in the preceding accounting year 2018-19) :

S. No. Name of the subsidiary Percentage Action Required under Listing Regulations
1. Mumtaz Hotels Ltd 20.51 (based on income) i) Secretarial Audit for 2019-20;
ii)Appointment of a EIH Independent Director on the Board of Mumtaz Hotels Ltd.
2. EIH International Ltd 23.37 (based on Net worth) Appointment of a EIH Independent Director on the Board of EIH International Ltd.
3. Mashobra Resorts Ltd 10.53 (based on Income) Secretarial Audit for 2019-20;
4. EIH Holdings Ltd 12.00 (based on Net worth) No action required.

Therefore, in accordance with regulation 24A of the listing regulations, Secretarial Audit of the records of the unlisted material subsidiaries, Mumtaz Hotels Limited and Mashobra Resorts Ltd, both incorporated in India, was conducted by JUS & Associates, Practicing Company Secretary for the Financial Year 2019-20. The Secretarial Audit Report submitted by the Practicing Company Secretary does not contain any qualification, reservation, or adverse remark. The Secretarial Audit Report of Mumtaz Hotels Ltd and Mashobra Resort Ltd are annexed and forms part of the Annual Report. At the Company's Board Meeting held on 13th August 2019, the Board had approved appointment of Mr. Sudipto Sarkar, Independent Director as a Director on the Board of EIH International Ltd, a foreign subsidiary and Dr. Chhavi Rajawat, Independent Director on the Board of Mumtaz Hotels Ltd, an Indian subsidiary. Accordingly, Mr. Sudipto Sarkar was appointed on the Board of EIH International Ltd on 9th September 2019 and Dr. Chhavi Rajawat was appointed on the Board of Mumtaz Hotels Ltd on 25th October 2019.

Associates

The Company has two domestic Associate Companies, namely, EIH Associated Hotels Ltd (a listed entity) and USmart Education Ltd (an unlisted entity).

Joint Ventures

The Company has three Joint Venture Companies, one domestic Company, namely, Mercury Car Rentals Private Ltd and two foreign Companies, namely, Oberoi Mauritius Ltd and La Roseraie De L'Atlas (also an associate as per Ind AS requirement) through its wholly owned foreign subsidiary.

A Report on the performance and financial position of each of the Subsidiaries, Associates and Joint Venture Companies are provided in the Annexure to the Consolidated Financial Statement and hence are not repeated here for the sake of brevity.

The policy on material subsidiaries can be accessed on the Company's website www.eihltd.com.

Directors/Key Managerial Personnel (KMP) Remuneration

a) During the year, in accordance with regulation 17(6) (e) of the listing regulations, special resolutions were passed by the shareholders by way of postal ballot and remote e-voting on 11th July 2019 in respect of remuneration of Mr. Vikramjit Singh Oberoi (DIN: 00052014), and Mr. Arjun Singh Oberoi (DIN: 00052106).

b) The ratio of the remuneration of each Director to the median employees remuneration for the Financial Year is as under:

S.No Name of the Director Directors' Remuneration Median Employees Remuneration Ratio
1. Mr. Prithvi Raj Singh Oberoi, 28.25 0.43 66:1
Executive Chairman
2. Mr. Shib Sanker Mukherji, 29.40 0.43 68:1
Executive Vice Chairman
3. Mr. Vikramjit Singh Oberoi 33.49 0.43 78:1
Managing Director & CEO
4. Mr. Arjun Singh Oberoi 30.72 0.43 71:1
Managing Director - Development

Directors' remuneration includes retirement benefits, wherever applicable

c) The percentage increase in remuneration of each Executive Director, Chief Executive Officer, Chief Financial Officer, Company Secretary or Manager, if any in the Financial Year:

S.No Name Total Remuneration Total Remuneration Percentage Increase / Decrease
2019-20 2018-19
1. Mr. Prithvi Raj Singh Oberoi 28.25 33.02 (14.45)
2. Mr. Shib Sanker Mukherji 29.40 32.94 (10.72)
3. Mr. Vikramjit Singh Oberoi 33.49 35.84 (6.56)
4. Mr. Arjun Singh Oberoi 30.72 33.32 (7.78)
5. Chief Financial Officer - 15.75* -
6. Chief Financial Officer 14.92 10.97** 36.01
7. Company Secretary 8.25 6.88 19.91

Total remuneration includes retirement benefits, wherever applicable

*Mr. Biswajit Mitra-CFO up to 30thSeptember 2018

**Mr. Kallol Kundu- CFO with effect from 1st October 2018

d) The percentage increase in the median remuneration of employees in the Financial Year 3.92%.

e) The number of permanent employees on the rolls of the Company at the end of the Financial Year are 3,929.

f) The average percentage increase already made in the salaries of employees of the Company other than the managerial personnel in the last Financial Year was 5.8%. The average percentage increase in the managerial remuneration is Nil. It is hereby affirmed that the remuneration of the Executive Directors and Key Managerial Personnel are as per the Remuneration Policy of the Company.

Internal Financial Controls and Risk Management Systems

Compliance of the Internal Financial Controls and Risk Management Systems are given in the Management Discussion & Analysis report.

Board Evaluation

In accordance with the provisions of the Act and Regulation 17(10) of the Listing Regulations, a Board Evaluation Policy is in place. A structured questionnaire by an independent external agency covering various aspects of the Board's functioning, Board culture, performance of specific duties by Directors and contribution to the Board proceedings was circulated to the members of the Board for the Financial Year 2019-20. Based on the responses received, the Board as a whole, the Committees, the Chairperson and individual Directors were separately evaluated in the meeting of the Independent Directors and at the meeting of the Board of Directors.

The process of review of Non-Independent Directors, the Board as a whole and also its Committees were undertaken in a separate meeting of Independent Directors held on 22nd May 2020 without the attendance of Non-Independent Directors and members of management. At the meeting, the performance of the Chairman of the Company was reviewed taking into account the views of the Executive Directors, Non-executive Directors and Independent Directors. The meeting also assessed the quality, quantity and timeliness of information required for the Board to perform its duties properly. The entire Board, excluding the Director being evaluated, evaluated the performance of each Independent Director.

The Directors have expressed their satisfaction with the evaluation process conducted by the independent external agency. Based on the findings from the evaluation process, the Board will continue to review its procedures, processes and effectiveness of Board's functioning, individual Directors effectiveness and contribution to the Board's functioning in the Financial Year 2020-21 as well with a view to practice the highest standards of Corporate Governance.

Cost Records

The Company is not required to maintain cost records in accordance with Section 148 of the Act read with Rule 3 of the Companies (Cost Record and Audit) Rules, 2014 as the services of the Company are not covered under the said rules.

Significant and Material orders, if any

During the Financial Year, there were no significant or material regulators, courts or tribunals impacting the going concern status and the Company's operation in future.

Prevention of Sexual Harassment at the Workplace

The Company has a policy for prevention of sexual harassment at the workplace. In accordance with the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("POSH Act") and rules made thereunder, the Company has constituted an Internal Compliant Committee (ICC) in all its hotels, Oberoi Flight Services (OFS), Oberoi Airport Services (OAS), Printing Press and Corporate Office. During the year, the ICC received three complaints from Company's Hotels. All the three complaints have been disposed of within the statutory time period prescribed under the POSH Act. The Company has also filed necessary returns as required to be filed under the POSH Act.

Particulars of Employees

In accordance with Section 197 of the Act read with Rule 5 of the Companies (Appointment and Remuneration) Rules, 2014 the following are annexed and forms part of this Report: i) List of top ten employees of the Company in terms of remuneration; ii) List of employees who received remuneration for the year which in the aggregate was not less than Rs 10.2 million; iii) List of employees who were employed for a part of the year and who received remuneration which in the aggregate, was not less than Rs 0.85 million per month.

Cautionary Statement

Risks, uncertainties or future actions could differ materially from those expressed in the Directors' Report and the Management Discussion and Analysis. These statements are relevant on the date of this Report. We have no obligation to update or revise any statements, whether as a result of new information, future developments or otherwise. Therefore, undue reliance should not be placed on these statements.

Acknowledgement

The Board takes this opportunity to thank all employees for their commitment, dedication and co-operation.

For and on behalf of the Board

ARJUN SINGH OBEROI VIKRAMJIT SINGH OBEROI
Mumbai Managing Director-Development Managing Director and Chief Executive Officer
26th June 2020