IIISL Annual Report Final

Lets Explore the Loan Zone with IIISL...
For you, from IIISL. Retail Loans, Professional Loans, Corporate Loans Roaming the loan jungle can make strong men weep. Exhaustion and despair get at you when your most sensible requirements are turned down, again and again. Know the feeling? Now, wave goodbye to darkness and gloom. Its good morning in the Loan Zone! This is where IIISL lifts you up, and flies you way above the confusions, anxieties and hesitations when exploring loan possibilities; giving you the quick, smooth flexibility you need. Whether you need a loan against your property or for your home; a loan against your gold, or for the most complex Healthcare Project; even the simplest loan against shares gets our detailed guidance and personal attention. Call us, well get you on your way, an easy, trouble-free way so you never get lost again.
INDIA INFOLINE INVESTMENT SERVICES LIMITED (IIISL)

ANNUAL REPORT 2010-11
INSIDE THIS REPORT

An Overview
01 Performance Highlights 2010-11 07 Financial Literacy Campaign 03 Chairmans Message 05 Corporate Identity
Business Discussion
09 Industry Overview 12 Performance Overview
Statutory Reports
13 Board of Directors 15 Directors Report
Standalone Financial Statements

20 Auditors Report 45 Cash Flow Statement 25 Balance Sheet 26 Profit and Loss Account 27 Schedules 47 Balance Sheet Abstract 48 Statement Relating to Subsidiary Companies
Consolidated Financial Statements

49 Auditors Report 66 Cash Flow Statement 50 Balance Sheet 51 Profit and Loss Account 52 Schedules
PERFORMANCE HIGHLIGHTS (Consolidated) 2010-11
Revenue
Net Interest Income
5.2
2,505.1 1,957.0
1,847.8 2.4 1.6 781.3 2.3
07-08 (` bn)
08-09
09-10
10-11
07-08 (` mn)
08-09
09-10
10-11
Profit after Tax
Net Worth
922.5 13.4 691.2 12.6 537.9 12.1 11.4 239.4
07-08 (` mn)
08-09
09-10
10-11
07-08 (` bn)
08-09
09-10
10-11
India Infoline Investment Services Limited Annual Report 2010-11
AN OVERVIEW
Earning per Share
Book Value per Share
3.9
56.6
2.9 2.3 1.6 47.9 51.1
53.3
Business Discussion
07-08 (`)
08-09
09-10
10-11 (`)
07-08
08-09
09-10
10-11
Loan Outstanding
NPA
Statutory Reports Gross NPA Net NPA
0.90 32.9
0.71 0.60 0.44 0.45
16.3 0.08 9.4 9.6
0.36
Financial Statements
-0.09
Mar 31`08 Mar 31`09 Mar 31`10 Mar 31`11
07-08 (%)
08-09
09-10
10-11
(` bn)
CHAIRMANS MESSAGE
The confidence in India's future growth is founded on favourable demographics-a rapidly expanding young population with a propensity to earn more and spend well. With a large number of new young wage earners, there is a big latent demand for credit as well, due to changing mindset and availability of opportunities. NBFCs, which serve the vital credit needs of under-served sectors like small and medium enterprises, emerged more or less unscathed in the financial turmoil of 2008, thanks to a robust framework in which they operate. In fact, the NBFCs have witnessed healthy growth after the crisis faced by the entire sector in the late 90s, which led to a revamp in the regulatory framework of the sector. This sector plays a complementary role in distribution of credit to various segments of the population and geographies where banks are under-penetrated. Most of the NBFCs have created a cost effective structure for distribution of credit. Over the years, they have developed their own credit evaluation skills and have put in place robust risk management systems as well as asset liability management. NBFCs also have the unique ability to handle small amounts of cash disbursals and cash collections. For the economy which is on rapid growth path, the need for financing different types of risks will continue. Given their size, scale and complexity, NBFCs play a nation-building role as it facilitates various economic activities by making credit available.
A. K. Purwar, Non-Executive Chairman, IIISL
The Indian economy recorded a robust 8.5% growth in 201011, driven by 9.4% growth in services sector. Manufacturing and agriculture also witnessed growth rates of 8.3% and 6.6% respectively. After a fast recovery from the global credit crisis of 2008, India remains one of the fastest growing economies in the world. Growth is driven primarily by domestic consumption, high savings and high investment spending. To counter rising inflation, RBI has resorted to a series of interest rate hikes. Repo and Reverse repo rates have risen from 5% and 3.5% to 6.75% and 5.7% respectively over the last 12 months. Interest rates however, continue under upward pressure.
NBFCs also have the unique ability to handle small amounts of cash disbursals and cash collections. For the economy which is on rapid growth path, the need for financing different types of risks will continue. Given their size, scale and complexity, NBFCs play a nationbuilding role as it facilitates various economic activities by making credit available.
AN OVERVIEW
The confidence in India's future growth is founded on favourable demographics - a rapidly expanding young population with a propensity to earn more and spend well. With a large number of new young wage earners, there is a big latent demand for credit as well, due to changing mindset and availability of opportunities.
Business Discussion
Compared to banks, the cost of funds for NBFCs is higher, because they do not have access to low cost deposits, and therefore they specialize in meeting the requirements of relatively higher risk assets. NBFCs play the role of the intermediary where they originate their assets that meet required specifications and complement the bank's efforts to reach out to deliver the credit at an affordable cost, bringing about an all-round economic development starting from the bottom of the pyramid; and all this at affordable rates. Any regulatory framework must afford flexibility to the system to meet these objectives in a systematic and prudent manner. Last year, your Company doubled its loan portfolio, which rose from `16.3 bn as on March 31, 2010 to ` 32.9 bn as on March 31, 2011. Home loans/ loans against property contributed about 60% of the portfolio while loan against shares/ margin financing contributed 35%. Unsecured loans, which we discontinued in 2008, was about 1% of portfolio, the balance was contributed by our newly launched gold loans and medical equipment loans. Our focus will remain on secured lending, going ahead and we hope to add new lines like loans to education sector. In the Indian context, for the next two decades, sectors that will require flow of debt capital on a large scale include infrastructure, education and healthcare. The variety, enormity and complexity of projects in these verticals will require assistance from the entire financial system, comprising not just banks but also complemented by NBFCs. Here, education and healthcare should get covered as infrastructure as is happening for the Banking system which will allow certain tax concessions and external borrowing to ensure rapid and healthy growth of these vital sectors. These investments have to be made for the country to enjoy the demographic dividend of a young population.
I believe that demand for housing in India will remain robust for many years, with the overall standard of living improving and rapid growth expected to continue. Every Indian deserves a pakka house over his head and it is sad that penetration of pakka houses is just about 17%. A house goes a long way in building not only a physically healthy community but also an emotionally secure one. The risk of real estate sector needs to be carefully evaluated. Prices have doubled only in certain pockets of Mumbai and Delhi. In the rest of the country, the real estate prices remain reasonable and affordable and in fact quite competitive. The real estate sector is important to meet the requirements of affordable housing as well as for key social infrastructure facilities and healthcare. It is important to take a wholistic view on the investment flow to real estate which goes towards security purpose and social purposes. In our endeavours to grow our portfolio, we will not compromise on risk. Your company has built the asset book steadily without taking undue risk and instead focusing on our core strength of retail distribution. Our risk management techniques have been robust and are reflected in the net NPA being less than 1% of the overall portfolio. We will continue to invest in risk management, audit and training of our most important asset, our people. In spite of short term challenges of rising interest rates, the long term potential of our business is immense and we will take all steps to ensure that we grow our book with focus on building a quality asset portfolio and thus enhance shareholder's value.
Statutory Reports Financial Statements
A. K. Purwar Chairman
CORPORATE IDENTITY
IIFL Group
VISION
To become the Most Respected Company in the financial services space in India.
VALUES
Team IIFL adheres to a set of values that can be summarized as GIFTS, namely, Growth, Integrity, Fairness, Transparency and Service
GROWTH
We are driven to grow faster than the rest of the industry. The culture therefore encourages calculated risks and empowerment at all levels.
TRANSPARENCY
We believe in as much transparency as practically possible, with our stakeholders, media and public at large.
INTEGRITY
We ensure utmost honesty and integrity, in letter and in spirit, in all our dealings with people internal or external.
SERVICE
We are a service organization, committed to delight our customers with superior advice and service, delivered with humility and sincerity.
FAIRNESS
We believe in fair dealings, devoid of any fear or favor, with all stakeholders including employees, customers and vendors.
COMPREHENSIVE PORTFOLIO
Retail Broking Wealth Advisory Institutional Equities Asset Management Commodities and Currency Broking Financial Products Distribution Credit and Finance Investment Banking
1+
million customers across various businesses
3000+
Business locations across India
10,000+
India Infoline team as on March 31, 2011
AN OVERVIEW
IIISL Overview
IIISL, a subsidiary of India Infoline Limited (IIFL) is registered with Reserve Bank of India as a Non Banking Finance Company
PRODUCT PORTFOLIO
Home Loans, Loans against Property Tenure: home loans upto 20 years, loans against property upto 15 years Upto 80% of value available for home loans, 65% for loans against property Repayment through EMIs, or other specially customised repayment schemes Balance transfers of existing loans obtainable, with additional cash in hand Healthcare Finance Loans upto 85% of the cost of equipment, starting at ` 500,000. Tenure from 12 to 72 months Funding for medical and ancillary equipment Project finance and receivable financing available Hospital construction and infrastructure finance Leasing and advisory services. Choice of personal loans for doctors Loans against Shares Loans upto ` 180 crores. Tenure: 3 to 12 months. Competitive interest rates, Funding against both diversified and concentrated securities Upto 600 approved Securities and Mutual Fund units Margins vary from 25% to 50% depending on securities Flexible margin financing and IPO funding schemes also available
Business Discussion
Gold Loan Cash against gold in 5 minutes flat Loans from ` 10,000 to ` 1,000,000 Attractive interest rates Choice of EMIs, or interest service options Flexible tenure, according to your requirements
SO FAR...
2004
IIFL incorporated India Infoline Investment Services Limited as a private limited company to undertake financing activities
2005
Received RBI license for undertaking NBFC activities and commenced business
2007
- IIISL became a public limited company - IIISL acquired Moneyline Credit Limited, an NBFC and commenced consumer loan business
Statutory Reports
2011
Launched Medical Equipment financing
2010
Launched Gold loans
2009
- Acquired registration for Housing Finance business from NHB - Mr A K Purwar, ex-SBI chairman joined the Board and appointed as Chairman of IIISL - Preferential Allotment to Orient Global Tamarind Fund Pte. Ltd., Singapore, an FII
FILINGS AND LISTINGS

IIFL subsidiaries India Infoline Investment Services and Moneyline Credit Limited are registered with the RBI as non-deposit taking, non-banking financial services companies. India Infoline Housing Finance Ltd, the housing finance arm, is registered with the National Housing Bank.
SPREADING THE LIGHT OF FINANCIAL LITERACY
FLAME - An IIFL Group Initiative
Dr. K C Chakrabarty, Deputy Governor, RBI
Launch of the FLAME book
Mr. Deepak Parekh, Chairman, HDFC Launch of FLAME Campaign by FLAME
FLAME (Financial Literacy Agenda for Mass Empowerment)

FLAME is IIFL's unique CSR initiative disseminating knowledge for financial literacy among the masses. Financial literacy can aid financial inclusion, which can result in long term sustainable growth and poverty alleviation. FLAME was launched by Dr K C Chakrabarty, Deputy Governor, RBI and Mr Deepak S Parekh, Chairman, HDFC at a function attended by the leading luminaries from the financial service space. As a part of the FLAME initiative, IIFL has planned an elaborate set of activities, which comprise: a. Financial awareness workshops across cities and towns all over India As a part of this initiative, IIFL has been organizing financial awareness workshops all over India. Here our expert speakers spread financial literacy by disseminating knowledge about various financial products and the associated risks and returns.
AN OVERVIEW
Financial Literacy Campaign in leading newspapers
IIFL publication - 108 Mantras for Financial Success
Business Discussion
b. A comprehensive mass media campaign The idea is to convey the various concepts which are a part of the literacy drive in an easy-to-grasp way. A daily campaign using cartoon illustrations, facilitating faster comprehension and assimilation is underway in leading publications. c. Books and publications Multiple publications are planned which would seek to highlight the various concepts of finance as a part of this initiative. Our first book called '108 mantras for Financial Success' targeted at small investors is now available at multiple bookstores across the nation. The publication is also distributed at the workshops held is various cities. d. Financial awareness helpline IIFL will setup a helpline, in our own call center, where anyone can call up and get answers to their queries pertaining to financial services. This helpline, manned by IIFL's trained professionals, will provide a solution to such queries. We are also using sms and social media to reach out to people all over the country and address their queries.
e. FLAME portal - www.flame.org.in, is a dedicated to the cause of spreading financial literacy. This portal carries concepts of financial literacy and awareness and is equipped with innovative features like 'chat with a FLAME-bearer' where users can direct their queries to IIFL's financial experts for resolution. The website is rapidly becoming popular by virtue of its rich content. f. Tie-ups with educational institutes IIFL will tie-up with educational institutes including B Schools across the country to deliver guest lectures. The objective of this is to educate the investors of tomorrow, today. g. Leaderspeak These will be financial awareness workshops where we will get industry luminaries to interact with the audience to explain the various concepts in the field of finance and investing.
Statutory Reports Financial Statements
IIFL FLAME Meet at Bhavnagar, Gujarat
FLAME portal www.flame.org.in is dedicated to the cause of spreading financial literacy
BUSINESS DISCUSSION
Credit and Finance

INDIAN CONSUMER LENDING MARKET
Despite the rapid growth of the financial services, India remains an under-penetrated market in terms of credit penetration. India has a large and rapidly growing middle class with increasing levels of discretionary income available for consumption and investment purposes. As investments among Indian consumers increase, the available credit in India has correspondingly increased. The last five years have seen not only a great expansion of the Indian economy but also a great expansion of consumer lending. Previously, Indian consumers were averse to the concept of using credit to fund purchases and preferred to save prior to spending. Today, with a variety of consumer credit products being widely available, Indian consumers are more willing to acquire assets through borrowing. The consumer credit market in India has undergone a significant transformation over the last decade and experienced rapid growth due to consumer credit becoming cheaper, more widely available and increasingly a more acceptable avenue of funding for consumers. The market has changed dramatically due to the following factors: 1. Increasing desire by customers to acquire assets such as cars, consumer durables and houses on credit. 2. Fast emerging middle class and growing number of households who are credit worthy. 3. Improved terms of credit as interest rates in India fell sharply during early and mid-2000s and further reduced interest rates offerings for sophisticated products. 4. Legislative changes that offer greater protection to lenders against fraud and potential default increasing the incentive to lend. 5. Growth in assignment and securitisation arrangements for consumer loans has enabled non-deposit based entities to access wholesale funding and compete in the market based on ability to originate, underwrite and service consumer loans. FY05 (in %) FY06 FY07 FY08 FY09 FY10 FY11
Source: RBI
Despite high loan growth in consumer financing, it remains an under-penetrated market. We believe demand for consumer loans will increase going forward in view of household gearing remaining low and disposable income continues to rise rapidly. Commercial banks play a dominant role in the financial services landscape by virtue of their wide distribution set up, ability to raise cheap retail deposits through brand identity. However, a majority of the commercial banks have maintained their focus in lending on industrial and corporate loans. As a result, lending to small business and consumer has always remained a smaller share of their overall lending portfolio. Lending by Banks to small business and consumer declined from 32% in FY08 to 27% in Fy11.
Commercial banks share in business and consumer lending
33
34
34 32 30 27 27
NON-BANKING FINANCE COMPANIES (NBFCS)

Under-penetrated and rapidly growing opportunities in small business and consumer lending has lead to heralding a new set
An Overview
of players in the non-banking financial services space. Non-banking financial companies asset base have grown rapidly over the last few years (27% CAGR between FY07 and FY11). A rapidly growing economy is likely to create strong demand for credit from small businesses and consumers. A combination of growing demand and lack of adequate focus from commercial banks on these banks is likely to create significant growth opportunity for NBFC. NBFCs are an integral part of the country's financial system, catering to a large market of niche customers, and have emerged as one of the major purveyors of retail and SME credit in India. It is a heterogeneous group of institutions (other than commercial and co-operative banks) performing financial intermediation in a variety of ways, such as accepting deposits, making loans and advances, providing leasing/hire purchase services, among others. There are over 12,000 NBFCs in India, (Source: Reserve Bank of India, Annual Report, August 2009) mostly in the private sector. Opportunity landscape for NBFC spans across many products ranging from secured to unsecured products. Opportunity within each segment remains significantly large given the current level of penetration (ranging from <1% to 9% of GDP). The potential market opportunity could be as high as 5%-10% of GDP in each product segment.
sustained at historical levels. The focus of most lenders in mortgage lending is confined to salaried urban middle to high income segments. The opportunity could be significantly expanded if the players were to focus on self employed segments as well. If the market landscape were to be expanded, potential growth rate could be even higher.
Mortgage Loans/ GDP ratio

81% 84%
95% BUSINESS DISCUSSION
48% 39% 41% 26% 17% 9% 20% 29% 32%
Taiwan
Singapore
Germany
USA
Hongkong
Malaysia
Denmark
Thailand
China
Korea
India
UK
Statutory Reports
Source: European Mortgage Federation, 2010, World Bank, 2010
LOAN AGAINST PROPERTY

Loan against property is a secured avenue for lending to small businesses against their working capital and or project finance needs. The estimated outstanding volume of loans by way of loan against property stood at ` 240 bn as at end March 2011. The opportunity landscape is very large given that small businesses do not get adequate flow of credit from the commercial banks but make a significant contribution to the economic growth. According to Annual Survey of Industries estimate for 2008-09 published by Ministry of Statistics and Program Implementation, firms with capital invested with ` 100 mn or below accounted for 21% of the capital invested by industry and 31% of the value of output. Bank financing accounted for less than 20% of the invested capital of these firms.
HOUSING FINANCE SECTOR

Opportunity in the mortgage market remains very large. Mortgage loans/ GDP ratio stands at 9% in FY10 (Source: IMF, European Mortgage Federation). There is significant opportunity to grow this market driven by huge demand and supply mismatch for dwelling units, rising income levels and favourable affordability. Mortgage market has sustained over 25% CAGR over the last 10 years. Given the latent demand for mortgages, loan growth could be
BUSINESS DISCUSSION
LOAN AGAINST CAPITAL MARKET INSTRUMENTS

Loan against security is yet another avenue for lending to corporates, HNIs, individuals for financing their capital market exposures as well as households to tide over their financing gaps that arise from time to time. Potentially, this could be a significant opportunity given that many small and medium enterprises aspire to grow large. This product effectively serves the purpose of providing bridge financing for asset acquisition as well as infusion of capital into new ventures. There is no estimate of potential market available, however, given the role that small businesses play in the overall economic development, this would likely be a huge opportunity.
2010. It is expected to witness a 35% CAGR between 200912. (Source: IDFC Indian Retail Finance). Indian consumers have a strong preference for gold that emanates from cultural factors. Further, low level of financial inclusion and poor access to financial products and services make gold a safe and attractive investment proposition.
HEALTHCARE FINANCING MARKET

Driven by various catalysts such as increasing population, rising income levels, changing demographics, and illness profiles with a shift from chronic to lifestyle diseases, Healthcare industry is expected to witness a strong growth of 23% p.a. to become a US$ 77 Bn industry by 2012. (Source: Yes Bank ASSOCHAM: Healthcare Services in India. 2012: The path ahead)
GOLD LOAN MARKET

India is one of the largest markets for gold. The organised gold loan market has grown from ` 416 bn in 2009 to ` 616 bn in
RETAIL FINANCE DISBURSEMENTS
FY10 12.8% 3.5% 3.7% 12.6% 0.7% 3.2% 8.2% ` 2.5 tn 55.3%
FY12E 12.5% 3.2% 3.9% 12.9% 0.9% 2.7% 8.4% ` 4.2 tn 55.5%
Mortgages
Credit cards
Personal loans
Consumer durables CVs

Source: IDFC Research Report
Car finance
Utility vehicles
2 Wheelers
Performance Overview
An Overview
`32.9 bn
Loan book doubled during the year
<1%
Less than one percent NPAs indicates a healthy loan book
BRIEF SNAPSHOT
BUSINESS DISCUSSION India Infoline Investment Services Ltd (a 98.82% subsidiary of IIFL) and its subsidiaries provide a wide array of secured loan products. The Company offers home loans, loans against property and loans against shares / debentures. The Company has recently launched gold loans and medical equipment financing. IIFL's robust credit and risk management processes have resulted in less than 1% NPAs. The Company has deployed proprietary loanprocessing software that enables stringent credit checks and fast application processing.
MAJOR HIGHLIGHTS, 2010-11

The loan book more than doubled during the year to `32.9 bn in FY11 from `16.3 bn in FY10 Home loans and loans against property contributed 60% of the loan portfolio, while capital market products contributed 35%. Our unsecured portfolio of personal loans is 1% of the total portfolio. Our personal loans business was discontinued in 2008. Launched healthcare financing, which includes project financing for brown field health projects, medical equipment and ancillary equipment finance and refinance on existing equipment. The loans are given to doctors, clinics, nursing homes, diagnostic centres and hospitals. Also launched gold loans during the year
PORTFOLIO BREAK-UP
FY10 6% 19% 36% ` 16.3 bn 42% 16% 16% ` 32.9 bn 60% FY11 4% 1%
Statutory Reports
CORE COMPETENCIES
Experienced team of professionals with work experience at globally respected financial houses Well spread out, pan India distribution network and a large client base gives cross sell opportunities. Sound credit management system and procedures, and a resultant quality portfolio with less than 1% NPAs Centralised credit and finance operations with connectivity to every branch and office, facilitating efficient and smooth loan servicing.
Mortgage Loan
LAS/ Debentures Personal Loan Others
Margin Funding
FUTURE ROAD MAP

Expand the recently launched healthcare and gold loans portfolio Strengthen customer relationships for upsell and cross sell opportunities Financial Statements
BOARD OF DIRECTORS
Mr. A. K. Purwar (Non Executive Chairman) Mr. Purwar is the Chairman of IndiaVenture Advisors Pvt. Ltd., IL&FS Renewable Energy Limited and India Infoline Investment Services Ltd. He is working as an Independent Director in leading companies in Telecom, Steel, Textiles, Power, Auto components, Renewable Energy, Engineering Consultancy, Financial Services and Healthcare Services. He is an Advisor to Mizuho Securities in Japan and is also a member of Advisory Board for Institute of Indian Economic Studies (IIES), Waseda University, Tokyo, Japan. Mr. Purwar was the Chairman of State Bank of India, the largest bank in the country from November '02 to May '06 and held several important and critical positions like Managing Director of State Bank of Patiala, CEO of the Tokyo branch, covering almost the entire range of commercial banking operations in his illustrious career at the bank from 1968 to 2006. Mr. Purwar also worked as Chairman of Indian Bank Association during 2005 2006. He is also the recipient of several awards like CEO of the year Award from the Institute for Technology & Management (2004); Outstanding Achiever of the year Award from Indian Banks' Association (2004); Finance Man of the Year Award by the Bombay Management Association in 2006. Mr. Nirmal Jain (Director) Mr. Nirmal Jain is the founder and Chairman of India Infoline Ltd. He is a PGDM (Post Graduate Diploma in Management) from IIM (Indian Institute of Management) Ahmedabad, a Chartered Accountant and a Cost Accountant. His professional track record is equally outstanding. He started his career in 1989 with Hindustan Lever Limited, the Indian arm of Unilever. During his stint with Hindustan Lever, he handled a variety of responsibilities, including export and trading
in agro-commodities. He contributed immensely towards the rapid and profitable growth of Hindustan Lever's commodity export business, which was then the nation's as well as the Company's top priority. He founded Probity Research and Services Pvt. Ltd. (later rechristened IIFL) in 1995; perhaps the first independent equity research Company in India. His work set new standards for equity research in India. Mr. Jain was one of the first entrepreneurs in India to seize the internet opportunity, with the launch of www. indiainfoline.com in 1999. Under his leadership, your Company not only steered through the dotcom bust and one of the worst stock market downtrends but also grew from strength to strength. Mr. R. Venkataraman (Director) R Venkataraman, Co-promoter and Managing Director of IIFL Group, has over two decades of experience in the financial services space. A B.Tech (Electronics and Electrical Communications Engineering, IIT Kharagpur) and an MBA (IIM Bangalore), he previously held senior managerial positions in ICICI Group, BZW, Taib Capital and GE Capital India, before joining the India Infoline board in July 1999. He spear-headed India Infoline Ltd's entry into the online broking space in 2000 and has today steered the company to become one of the leading players in the Indian financial services space. Mr. Nilesh Vikamsey (Independent Director) Mr. Nilesh Vikamsey - Board Member since February 2005 - is a practicing Chartered Accountant for 25 years and Senior Partner at M/s Khimji Kunverji & Co. Chartered Accountants, a member firm of HLB International, a w o r l d - w i d e o rg a n i z a t i o n o f professional accounting firms and business advisers, ranked amongst the top 12 accounting groups in the world.
An Overview
He is elected member of the Central Council of Institute of Chartered Accountant of India (ICAI), the Apex decision making body of the second largest accounting body in the world, 20102013. He is Chairman of its Research Committee, Vice Chairman of its Corporate Laws & Corporate Governance Committee and member of its various other committees. He is Representative of the ICAI on the Committee for Improvement in Transparency, Accountability and Governance (ITAG) of South Asian Federation of Accountants (SAFA) and also on Committee constituted by Ministry of Corporate Affairs (MCA) on issues of applicability of Foreign Investments in LLPs. He is member of Review, Reforms & Rationalization Committee (IMC), Member of Legal Affairs Committee of Bombay Chamber of Commerce and Industry (BCCI), member of Accounting and Auditing Committee of Bombay Chartered Accountant Society (BCAS) and also on its Core Group, Corporate Members Committee of The Chamber of Tax Consultants (CTC) and a Regular Contributor to WIRC Annual Referencer on "Bank Branch Audit". Mr. Vikamsey is also a Director of India Infoline Investment Services Limited, Rodium Realty Limited, ICAI Accounting Research Foundation and few private limited companies and Trustee in Sayagyi U Ba Khin Memorial Trust (Vipassana International Academy) and a few Trusts focusing on education. Mr. Mahesh Narayan Singh, (Independent Director) Mr. Mahesh Narayan Singh is an Independent Director of India Infoline Investment Services Limited. He holds a Post-Graduate degree in Physics from Banaras Hindu University. Mr. Singh Joined the 'Indian Police Service' in 1967. He has worked as the chiefs of the crime branch of Mumbai Police, State CID and Anti-Corruption Bureau. Mr. Singh received his initial training at the National Academy of Administration,
Mussoorie and the National Police Academy, Mount Abu. Subsequently, government deputed him for a course in 'Senior Command Management' in UK and a training programme in 'Disaster Management' in USA. In his long years of service under the government, Mr. Singh held many important positions in the police as well as in the ministry and acquired rich experience in public administration, law enforcement and corporate management. Mr. Singh has vast experience in handling all types of crimes, especially organized crime, economic offences and international terrorism. He has worked closely with the Central Agencies at the head of 'Special Task Force' to investigate serious crimes having national and international ramifications. Mr. Singh also had a long stint in the government as a Joint Secretary and as Managing Director of Police Housing Corporation. Mr. Singh retired from the highest rank of Director General of Police at the end of a distinguished career in public service spanning over a period of 35 years. His services were recognized by the Government of India with the award of 'Indian Police Medal' for meritorious services and 'President's Police Medal' for distinguished services. Ms. Pratima Ram, (Wholetime Director & Chief Executive Officer) Ms. Pratima Ram is a Whole Time Director of our Company. She joined the Board of our Company in May 2011. She holds a Masters Degree in Arts from University of Virginia. Prior to joining our Company, she held various senior management positions in State Bank of India including those of country head of State Bank of India's United States Operations based in New York. She has worked as CEO of South Africa Operations of SBI, based in Johannesburg. She has also headed Mergers & Acquisitions at SBI Capital Markets and has worked with Punj Loyyds as Group President - Finance.
Business Discussion STATUTORY REPORTS Financial Statements
DIRECTORS REPORT Directors Report

Dear Members, Your Directors have pleasure in presenting the Seventh Annual Report of your Company with the audited financial statements for the financial year ended March 31, 2011 Standalone Financial Results Particulars Gross Total Income Less: Expenditure Profit /(Loss) Before Taxation Less: Taxation - Current - Deferred - Short Provision of Tax for earlier year Net Profit / (Loss) After Tax 2010 2011 4519.0 (3324.6) 1194.4 380.5 (22.9) 10.2 826.6 (` in mn) 2009 2010 1,650.4 (987.9) 662.5 185.9 (1.6) 2.7 475.5
Consolidated Financial Results Particulars Gross Total Income Less: Expenditure Profit /(Loss) Before Taxation Less: Taxation - Current - Deferred - Short Provision of Tax for earlier year Net Profit / (Loss) After Tax Review of Business Your Company's product offerings include margin funding, loan against shares, promoter funding, loan against commercial and residential property, gold loans and healthcare equipment financing. Your Company's loan book doubled during the year to `32.9 bn from `16.3 bn in 2009-10. Home loans and loan against property contributed 60% of the loan portfolio, while capital market products contributed 35%. Our unsecured portfolio of personal loans, which was discontinued in 2008, stood at 1% of our total portfolio. On a consolidated basis, your Company's income significantly increased by 122.04% to ` 5194.9 mn and profit after tax increased by 71.5% to ` 922.5 mn during the year. The growth in loan book in the current year was driven by the Company's capability to originate retail and wholesale assets against collateral of property through its nationwide distribution network and quick turnaround in the economic and credit environment. The loan against securities book tends to be more volatile depending on capital market sentiment. India Infoline Investment Services Limited Annual Report 2010-11 2010 2011 5194.9 (3854.5) 1340.5 427.6 (22.3) 12.7 922.5
(` in mn) 2009 2010 2,339.6 (1,573.6) 766.0 210.1 14.6 3.4 537.9
During the year, your Company launched healthcare financing, which includes project financing for brown field health projects, medical equipment and ancillary equipment finance and refinance on existing equipment. The loans are given to doctors, clinics, nursing homes, diagnostic centers and hospitals. Your Company also launched gold loans during the year. Going forward, your Company expects to expand the recently launched healthcare and gold loans portfolio and strengthen customer relationships for upsell and cross sell opportunities. Compared to other NBFCs in the peer group, your Company's balance sheet is relatively under- leveraged and hence has capacity to meet funds requirement for growth in the near future without resorting to fresh equity capital. Transfer to Reserve During the year 2010-11, your Company transferred 20% of the net profit amounting to ` 166 mn to Special Reserve as required under the provisions of Section 45 IC of The Reserve Bank of India Act, 1934. Further, your Company proposes to transfer ` 83 mn to the General Reserve out of the amount available for appropriations pursuant to Companies (Transfer of Profit to Reserves), 1975.
An Overview
Dividend During the year 2010-11, your Company declared and paid interim dividend of `5 per equity share (face value of `10 each). The total outflow on account of dividend payout (including dividend distribution tax and surcharge) was `13.82 crore. The same is considered as final. Bonus Shares During the 2010-11, your Company issued 9 (nine) bonus shares of `10 each for every 1 (one) share held. As a result the paid up equity share capital of your Company had increased to `237,15,40,300 divided into 23,71,54,030 equity shares of `10 each. Deposits Your Company has not accepted any Deposits within the meaning of Section 58A of the Companies Act, 1956 and the Rules made thereunder. Risk Management & Internal Controls Your Company has a multi level Credit & Investment Committees consisting of directors of the board/ HODs to consider credit and investment proposals. The major credit proposals are formally evaluated and approved by various committees. We have in place the Risk Management Committee and Asset Liability Management Committee (ALCO) consisting of directors and senior officials which regularly meets and reviews the policies, systems, controls and positions of credit and finance business. The risk committee reviews the risk management processes covering credit and underwriting controls, operations, technology, compliance risks, etc. The ALCO committee involves in balance sheet planning from risk return perspective including the strategic management of interest rate and liquidity risk. Towards this end, the ALCO committee reviews product pricing for various loans and advances, desired maturity profile and mix of the incremental asset and liabilities. It reviews the funding policies of your Company in the light of interest rate movements and desired fund mixes particularly fixed/ floating rate funds, wholesale/ retail funds, money market funding etc. from time to time. Your Company has invested in ensuring that its internal audit and control systems are adequate and commensurate with the nature of our business and the size of our operations. Your Company has retained a reputed global firm Ernst & Young as its Group Internal Auditor. Your Company also retains a few specialized Audit firms to carry out specific/ concurrent audit of some critical functions such as KYC process, branches audits, loan documentations audits etc. Your Company also has an internal team of professionals at head office in Mumbai,
supported by regional teams at zonal offices. The internal team undertakes some special situation audits and follows up on implementation of Internal Auditors' recommendations. The Auditors' reports and recommendations and rectifications/ implementations are reviewed by the top management and Audit Committee at regular intervals. The internal processes have been designed to ensure adequate checks and balances at every stage. The processes are reviewed periodically by Internal Auditors as well as Audit Committee and amended as required. Your Company also has to comply with several specific audits that are required by regulatory authorities and the reports are submitted to the regulators periodically. Corporate Governance Your Company has fully complied with the Corporate Governance Guidelines for NBFCs issued by Reserve Bank of India vide circular No. DNBS (PD) CC No. 94/ 03.10.042/ 2006-07 dated May 8, 2007. In accordance with the said Corporate Governance Guidelines, your Company has put in place the following committees and ensures best corporate practices to increase the investors and other stakeholders confidence. Audit Committee a) Mr Nilesh Vikamsey (Chairman & Independent Director) b) Mr M N Singh (Independent Director) c) Ms Pratima Ram d) Mr Kapil Krishan Nomination Committee a) Mr M N Singh (Independent Director) b) Mr Nilesh Vikamsey (Independent Director) c) Mr Nirmal Jain d) Mr R Venkataraman Risk Management Committee a) Mr A K Purwar (Non Executive Chairman) b) Mr Nilesh Vikamsey (Independent Director) c) Mr Nirmal Jain d) Mr L P Aggarwal Assets and Liabilities Committee a) Mr A K Purwar (Non Executive Chairman) b) Mr Nirmal Jain c) Ms Pratima Ram d) Mr L P Aggarwal e) Mr Kapil Krishan All the above Committees regularly meets and reviews the policies and status.
Business Discussion STATUTORY REPORTS Financial Statements
DIRECTORS REPORT
Regulatory Compliance Your Company has complied with all the applicable guidelines prescribed by RBI for NBFCs regarding accounting standards, income recognition, capital adequacy, guidelines on Corporate Governance etc. Capital Adequacy As a result of the increased net worth, your Company was able to enhance the Capital to Risk Assets Ratio (CRAR) to 29.95% as on March 31, 2011, which is well above CRAR of 15% prescribed by the Reserve Bank of India. Directors In accordance with the provisions of Section 255 and 256 of the Companies Act, 1956 and in terms of applicable provisions of the Articles of Association of the Company, Mr. Nilesh Vikamsey, Director of your Company retires by rotation and being eligible, offers himself for re-appointment. Pursuant to the provisions of Section 260 and in terms of Section 269 and other applicable provisions of the Companies Act, 1956, Mr. Kapil Krishan was appointed as an Additional Director designated as Whole Time Director on October 23, 2010. Your Company has received a notice from a Member under Section 257 of the Companies Act, 1956, proposing the name of Mr. Kapil Krishan for appointment as a Whole Time Director of your Company for a period of five years. Also, Ms. Pratima Ram was appointed as a Whole Time Director designated as Whole Time Director & Chief Executive Officer on May 07, 2011. A proposal to seek your approval for appointment of Ms. Pratima Ram as Whole Time Director & Chief Executive Officer and Mr. Kapil Krishan as Whole time Director is provided in the Notice of the forthcoming Annual General Meeting. Directors' Responsibility Statement As required under the Section 217(2AA) of the Companies Act, 1956, your Directors declare and certifies that: (a) in the preparation of the annual accounts, the applicable accounting standards, have been followed (b) the Board of Directors have selected the accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the Profit of the company for that period. c) the Board of Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, India Infoline Investment Services Limited Annual Report 2010-11
1956 for safeguarding the assets of your company and preventing and detecting fraud and other irregularities. (d) the Board of Directors have prepared the annual accounts on a going concern basis Auditors M/s Sharp & Tannan Associates, Chartered Accountants, Statutory Auditors of your Company retire at the conclusion of the ensuing Annual General Meeting and being eligible offers themselves for re-appointment. Certificate under Section 224(1B) has been obtained from M/s Sharp & Tannan Associates, to the effect that they are eligible to be appointed as the Statutory Auditors of your Company. Your Board and Audit Committee recommends appointment of M/s Sharp & Tannan Associates as the Statutory Auditors of the Company to hold office from this Annual General Meeting to the next Annual General Meeting. Subsidiaries As on March 31, 2011, your Company has following three subsidiaries: a) India Infoline Housing Finance Limited b) Moneyline Credit Limited c) India Infoline Distribution Company Limited Pursuant to the general exemption granted by the Ministry of Corporate Affairs vide circular dated February 8, 2011, the Board of Directors had at their meeting held on May, 7, 2011 approved attaching the consolidated financials of all the subsidiaries of the Company along with that of the Company. The copies of the Balance Sheet, Profit and Loss Account, Report of the Board of Directors and Report of the Auditors of each of the subsidiary Companies are not attached to the accounts of the Company for financial year 2010-11. Your Company will make available these documents/details upon request by any member of the Company. These documents/details will also be available for inspection by any member of the Company at its registered office and also at the registered offices of the concerned subsidiaries. As required by Accounting Standard - 21 (AS-21) issued by the Institute of Chartered Accountants of India, the Company's consolidated financial statements included in this Annual Report incorporates the accounts of its subsidiaries. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo The Disclosure of Information on Conservation of Energy, Technology Absorption etc, required to be disclosed in terms
An Overview
of section 217 (I) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 have not been given since your Company is engaged in financial services industry, and has not carried on any manufacturing activity. The operations of the Company are not energy intensive. However it is the policy of the management to keep itself abreast of technological developments in the field in which the Company is operating and to ensure that the Company uses the most suitable technology. The Company had no foreign exchange earnings and outgo during the year. Particulars of Employees In terms of provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, the names and other particulars of employees are set out in the Annexure to the Directors' Report.
Acknowledgements Your Directors take this opportunity to thank the Reserve Bank of India, Banks and Financial Institutions and other stakeholders for their continued support and assistance during the period under review. Your Directors would also like to thank the employees for their dedication towards the growth of the Company.
Business Discussion
For and on behalf of the Board
A K Purwar Non Executive Chairman Dated: May 07, 2011 Place: Mumbai
STATUTORY REPORTS Financial Statements
FINANCIAL STATEMENTS
Standalone Financial Statements

20 Auditors Report 45 Cash Flow Statement 25 Balance Sheet 26 Profit and Loss Account 27 Schedules 47 Balance Sheet Abstract 48 Statement Relating to Subsidiary Companies
Consolidated Financial Statements

49 Auditors Report 66 Cash Flow Statement 50 Balance Sheet 51 Profit and Loss Account 52 Schedules
An Overview
Auditors Report
To The Members, India Infoline Investment Services Limited We have audited the attached Balance Sheet of India Infoline Investment Services Limited as on March 31, 2011, the Profit and Loss Account and also the Cash Flow Statement for the period ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit. We have conducted our audit in accordance with the auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In accordance with the provisions of Section 227 of the Companies Act, 1956, we report that: 1. As required by the Companies (Auditors Report) Order, 2003, issued by the Central Government of India under sub-section (4A) of Section 227 of the Companies Act, 1956, and on the basis of such checks of books and records of the Company as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order. 2. Further to our comments in the Annexure referred to above, we report that: i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit; ii) 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 the books; iii) The Balance Sheet, Profit and Loss account and also Place: Mumbai Date: May 07, 2011 the Cash Flow statement dealt with by this report are in agreement with the books of account; iv) In our opinion, the balance sheet, profit and loss account and also the cash flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956; v) On the basis of written representations received by the company from its Directors as on March 31, 2011 and taken on record by the Board of Directors, we report that none of the director is disqualified as on March 31, 2011 from being appointed as a Director in terms of the clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956. In our opinion, and to the best of our information and according to the explanations given to us, the said accounts, read together with the significant accounting policies and notes to accounts, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India; a. in case of balance sheet, of the state of affairs of the company as at March 31, 2011; b. in case of profit and loss account, of the profit for the year ended on that date; and c. in case of the Cash Flow Statement, of the cash flows for the year ended on that date.
Business Discussion Statutory Reports
Sharp & Tannan Associates Chartered Accountants ICAI Registration No.109983W By the hand of FINANCIAL STATEMENTS Tirtharaj Khot Partner Membership No.: 37457
20
Standalone Financial Statements of India Infoline Investment Services Limited

Annexure
Referred to in paragraph 1 of our report dated May 7, 2011 to the members of India Infoline Investment Services Limited 1. (a) The Company has maintained adequate records to show full particulars, including quantitative details and situation of the fixed assets. (b) The Company has formulated a programme of physical verification of its fixed assets in a phased manner. In accordance with this program, a physical verification of certain fixed assets has been carried out by management during the year and there are no material discrepancies observed between assets physically verified and book balances. In our opinion, the periodicity of verification is reasonable having regard to the size of the company and the nature of its assets. (c) The Company has not disposed of any substantial part of its fixed assets so as to affect its going concern status. 2. The Company is not carrying on any manufacturing or trading activity. Therefore, the provisions of sub clause (a), (b) and (c) of clause (ii) of paragraph 4 of the Order are not applicable to the Company. of clause (iii) of paragraph 4 of the Order are not applicable to the Company. 4. In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and nature of its business, for the purchase of fixed assets and sale of services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across nor have we been informed of any continuing failure to correct major weaknesses in the aforesaid internal control systems.
5. (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements that need to be entered into a Register in pursuance of Section 301 of the Companies Act, 1956 and those brought to our notice, have been so entered. (b) In our opinion and according to the information and explanations given to us, the transactions in pursuance of such contracts or arrangements entered in the register maintained under Section 301 of the Companies Act,1956 and exceeding the value of ` 500,000 in respect of any party during the year, have been made at prices which are not comparable since the prevailing market prices of such services, in view of the management, are not readily available. 6. The Company has not accepted any deposits from the public of the nature which attracts the provisions of Section 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and the rules made there under. Therefore, the provision of clause (vi) of paragraph 4 of the Order is not applicable to the Company. In our opinion, the Company has an internal audit system commensurate with its size and nature of its business. As per the information and explanations given to us, in respect of the class of industry the Company falls under, the maintenance of cost records has not been
3. (a) The Company has granted loan to three companies covered under register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was ` 3,643,034,393/- and the year, end balance of the loan granted to such Company was ` 1,702,300,003/(b) In our opinion, the rate of interest and other terms and condition of such loan are not, prima facie, prejudicial to the interest of the Company. (c) There are no stipulation as to repayment of principal and interest amount. (d) There is no overdue amount in excess of ` 100,000 in respect of loan granted to Company listed in the register maintained under Section 301 of the Companies Act,1956, since repayment schedule is not stipulated. (e) The Company has not taken any loans from the companies, firms or other parties covered in the register maintained under Section 301 of the companies Act, 1956. As the Company has not taken any loans, the provisions of sub clause (e), (f), and (g)
7.
8.
21
An Overview
prescribed by the Central Government under Section 209 (1) (d) of the Companies Act, 1956. Therefore, the provision of clause (viii) of paragraph 4 of the Order is not applicable to the Company. 9. (a) According to the information and explanations given to us, and as per the records of the Company, in our opinion the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues with the appropriate authorities, where applicable. Based on the information furnished to us, there are no undisputed statutory dues as on March 31, 2011, which are outstanding for a period exceeding six months from the date they became payable. Name of the Statute Nature of the Disputed Dues Amount (`) of Tax
(b) According to the information and explanations given to us, there are no cases of non-deposit with the appropriate authorities of disputed dues of sales tax/ income tax/ customs tax/ wealth tax/ service tax/ excise duty and cess as at March 31, 2011 which have been not deposited on account of dispute pending, and amount involve and the forum where disputes is pending as under : 10. At the end of the financial year, the Company has no accumulated losses exceeding fifty percent of its net worth. Further, the Company has not incurred cash loss during the financial year covered by our audit, and has not incurred cash losses during the financial year immediately preceding financial year. Based on our audit procedures and according to the information and explanations given to us, we are of the Period to Which The Amount Relates A.Y. 2007-2008 Business Discussion
11.
Forum Where Dispute is Pending Commissioner of income tax appeal
Income Tax Act,1961
Disallowance u/s 14(A) of IT act.
` 4,469,700/amount of outstanding demand paid
Statutory Reports
opinion that the Company has not defaulted in repayment of its dues to its financial institution, bank and debenture holders. 12. In our opinion, and according to the information and explanations given to us, the Company has maintained adequate records in cases of loans and advances granted on the basis of security by way of pledge of shares, debentures or other securities. The Company is not a chit fund or a nidhi/ mutual benefit fund/ society. Therefore, the provisions of sub clause (a), (b), (c) and (d) of clause (xiii) of paragraph 4 of the Order are not applicable to the Company. Based on our examination of the records and evaluation of the related internal controls, the
Company has maintained proper records of transactions and contracts in respect of its dealing or trading in shares, securities, debentures and other investments, as applicable, and timely entries have been made therein. The aforesaid securities have been held by the Company in its own name, except to the extent of the exemption granted under Section 49 of the Companies Act, 1956. 15. According to the information and explanations given to us, the Company has not granted any guarantee for loans taken by others from bank or financial institutions. Therefore, the provision of clause (xv) of paragraph 4 of the Orders not applicable to the Company. In our opinion, and according to the information and
13.
14.
16.
22
explanation given to us, the term loans have been applied for which they were raised. 17. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investments. According to the information and explanations given to us, during the year the Company has not made preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. According to the information and explanations given to us, during the period covered by our audit report, the Company had issued debentures. The Company has created security in respect of debentures issued. The Company has not raised any money through a public issue during the period. Therefore, the provision of clause (xx) of paragraph 4 of the Order is not applicable to the Company.
21.
During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanation given to us, we have neither come across any instances of material fraud on or by the Company, noticed or reported during the year nor have we been informed of such case by management.
18.
Sharp & Tannan Associates Chartered Accountants ICAI Registration No.109983W By the hand of Tirtharaj Khot Place: Mumbai Date: May 07, 2011 Partner Membership No.: 37457
19.
20.
23
An Overview
Auditors Report
Pursuant to NBFCs Auditors Report (Reserve Bank) Directions, 2008
To The Board of Directors, India Infoline Investment Services Limited As required by the Non-Banking Financial Companies Auditors Report (Reserve Bank) Directions, 2008 (hereinafter referred to as the Direction) issued by the Reserve Bank of India vide Notification No. DNBS (PD) 201/DG (VL)/2008 dated September 18, 2008, in exercise of the powers conferred by the sub section (IA) of section 45MA of the Reserve Bank of India Act, 1934 (2 of 1934) and based on the books and records verified by us and according to the information and explanations given to us during the normal course of the audit for the year ended March 31, 2011, we report as under: 1. a. In our opinion the Company is engaged in the business of Non-banking Financial Institution and it has received the Certificate of Registration (CoR) No. 13.01792 dated May 12, 2005 from Reserve Bank of India (hereinafter referred to as the Bank). b. In our opinion, the Company is entitled to continue to hold such COR in terms of its asset/finance pattern as on March 31, 2011. 2. In our opinion, based on the business carried on by the Company during the year it is not an Asset Finance Company (AFC) as defined in Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998. The Board of Directors of the Company at their meeting held on April 24, 2010, have passed a resolution for nonacceptance of public deposit. The Company has not accepted any deposit from public during the year ended March 31, 2011. In our opinion, the Company has complied with prudential norms relating to income recognition, accounting standards, asset classification and provisioning for bad and doubtful debts, as applicable, to it in terms of Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007 for the year ended March 31, 2011. 6. a. The capital adequacy ratio as disclosed in the return for the year ended March 31, 2011 submitted to the Bank in form NBS-7 has been correctly arrived at and is in compliance with the minimum CRAR prescribed by the Bank. b. The Company has furnished to the Bank the annual statement of capital funds, risk assets/exposures and risk asset ratio (NBS-7) within the stipulated period, for the year ended March 31, 2011.
Business Discussion
Statutory Reports
3.
4.
5.
24

Balance Sheet
as at March 31, 2011 (Amount in `) Schedule SOURCES OF FUNDS Shareholders Funds Share Capital Reserves And Surplus Loan Funds Secured Loans Unsecured Loans Total APPLICATION OF FUNDS Fixed Assets Gross Block Less: Depreciation Net Block Capital Work-in-progress Investments Deferred Tax (refer Note Of B-12 Of Schedule L) Current Assets, Loans And Advances Cash And Bank Balances Closing Stock Loans And Advances Less: Current Liabilities & Provisions Current Liabilities Provisions Net Current Assets Total Significant accounting policies and notes to accounts As per our attached report of even date For Sharp & Tannan Associates Chartered Accountants ICAI Registration No. 109983W By the hand of Tirtharaj Khot Partner Membership No. 37457 Place : Mumbai Dated : May 07, 2011 India Infoline Investment Services Limited Annual Report 2010-11 For India Infoline Investment Services Limited As at March 31, 2011 As at March 31, 2010
A B C
2,371,540,300 10,858,789,813 11,898,409,110 8,932,000,000
13,230,330,113
237,154,030 12,321,369,967 2,615,100,000 6,590,000,000
12,558,523,997
20,830,409,110 34,060,739,223
9,205,100,000 21,763,623,997
D 122,996,100 9,577,914 113,418,186 37,250,464 E 3,280,790 1,067,498 2,213,292 -
150,668,650 4,417,764,091 30,046,072
2,213,292 3,376,748,400 7,161,447
F 312,859,962 223,833,262 31,018,638,841 31,555,332,065 G 2,021,195,453 71,876,202 2,093,071,655 29,462,260,410 34,060,739,223 L 141,484,458 141,484,458 18,377,500,858 21,763,623,997 1,015,599,411 113,693,188 17,389,692,717 18,518,985,316
Kapil Krishan Whole Time Director
R Venkataraman Director
Binoy K Parikh Company Secretary
25
An Overview
Profit & Loss Account

for the year ended March 31, 2011 (Amount in `) Schedule INCOME Income from operations Other income Total Expenditure Direct cost Employee cost Administration & other expense Interest & finance changes Depreciation Total Profit before tax Provision for taxation - Current tax - Deferred tax - Short provision of Income Tax Profit after tax Appropriations Dividend Interim dividend Dividend distribution tax Transfer to special reserve Transfer to general reserve Balance of profit brought forward Balance of profit carried forward Earning per share - basic (`) Earning per share - diluted (`) Face value per share (`) Significant accounting policies and notes to accounts As per our attached report of even date For Sharp & Tannan Associates Chartered Accountants ICAI Registration No. 109983W By the hand of Tirtharaj Khot Partner Membership No. 37457 Place : Mumbai Dated : May 07, 2011 For India Infoline Investment Services Limited 2010 - 2011 2009 - 2010
4,255,588,321 263,470,890 4,519,059,211
1,623,921,387 26,428,595 1,650,349,982 176,147,288 365,252,120 253,697,204 192,163,296 634,405 3,324,637,042 1,194,422,169 380,494,244 (22,884,625) 10,235,259 826,577,291 987,894,313 662,455,669 185,849,934 (1,586,360) 2,687,804 475,504,291
I J K D
231,639,584 600,707,503 432,276,623 2,051,502,916 8,510,416
Business Discussion
118,577,015 19,694,160 166,000,000 83,000,000 1,207,289,524 1,646,595,640 3.49 3.40 10.00 L
97,106,337 828,891,570 1,207,289,524 2.01 1.93 10.00
Statutory Reports FINANCIAL STATEMENTS
26

Schedules forming part of the Balance Sheet
as at March 31, 2011 (Amount in `) As at March 31, 2011 Schedule A: Share Capital Authorised : 300,000,000 (Previous Year 50,000,000) Equity Shares of ` 10/- each Issued, Subscribed and Paid Up: 237,154,030 (Previous Year 23,715,403) Equity Shares of ` 10/- each fully paid-up Includes 213,438,627 (Previous Year Nil) equity shares alloted by way of bonus as fully paid up shares by capitalisation of securities premium account (Out of above 182,000,000 (Previous Year 18,200,000) equity shares are held by its Holding Company India Infoline Limited and 52,838,700 (Previous Year 5,283,870) shares held by its fellow subsidiary) Total Schedule B: Reserves And Surplus Securities Premium Account: Opening Balance Addition during the year Deduction during the year, for issue of bonus shares and adjustment of share issue expenses Closing Balance General Reserve Opening Balance Addition during the year Closing Balance Special Reserve* Opening Balance Addition during the year Closing Balance *Pursuant to Section 45 1C of Reserve Bank of India Act, 1934 Profit and Loss Account Total Schedule C: Loan Funds SECURED LOAN Loans from banks ( Secured against receivables ) Non Convertible Debentures (Secured against immovable property, stock & book debts) Total (refer note B-3 of Schedule L ) UNSECURED LOAN Non Convertible Debentures Commercial Papers Total Total* *The above include ` 10,370,442,444 (Previous Year ` 7,840,000,000) due within one year India Infoline Investment Services Limited Annual Report 2010-11 As at March 31, 2010
3,000,000,000 2,371,540,300
500,000,000 237,154,030
2,371,540,300
237,154,030
10,808,374,106 (2,150,886,270)
10,808,374,106 -
8,657,487,836 10,808,374,106 83,000,000 83,000,000 305,706,337 166,000,000 471,706,337 208,600,000 97,106,337 305,706,337
1,646,595,640 1,207,289,524 10,858,789,813 12,321,369,967
8,500,109,110 3,398,300,000 11,898,409,110
2,000,000,000 615,100,000 2,615,100,000
272,000,000 8,660,000,000 8,932,000,000 20,830,409,110
5,190,000,000 1,400,000,000 6,590,000,000 9,205,100,000
27

(Amount in `) Gross Block Deductions 122,996,100 3,280,790 1,067,497 433,093 8,510,416 634,405 69,281,119 553,134 5,401,242 5,954,376 3,031,904 124,828 192,099 316,927 19,431,926 151,332 757,840 909,172 18,522,754 2,714,977 63,326,743 145,000 9,642,669 21,463,483 16,311 221,893 7,250 1,020,804 1,131,182 23,562 1,020,804 1,353,074 121,439 8,621,865 20,110,408 128,690 454,794 50,437 290,447 1,288,925 2,213,293 150,668,650 2,213,293 As at 31.03.2011 As at For the year Deductions 31.03.2010 Upto at 31.03.2011 As at 31.03.2011 As at 31.03.2010 Depreciation Net Block
as at March 31, 2011
Schedule D: Fixed Assets
Assets 9,642,669 20,786,796 19,230,157 2,616,629 67,439,060
As at 31.03.2010
Additions
145,000 676,687
201,769
415,275
1,842,059
3,280,790 3,280,790
119,715,310 -
Premises Computer Electrical Equipment Office Equipment Air Conditions Furniture & Fixture TOTAL Previous Year Capital Work in Progress 9,577,914 113,418,186 1,067,498 2,213,292 37,250,464
An Overview
Business Discussion
Statutory Reports
28

Schedules forming part of the Balance Sheet as at March 31, 2011
as at March 31, 2011 (Amount in `) Face Value Schedule E: Investments a. Long Term Investments Unquoted, Trade, Long Term (Valued at cost) Investment in Subsidiaries Equity Shares India Infoline Distribution Company Limited Moneyline Credit Limited India Infoline Housing Finance Limited Preference Shares India Infoline Housing Finance Limited Unquoted, Non-Trade, Long Term (Valued at cost) Units of India Infoline Venture Capital Fund (IIFL Opportunity Fund ) Arch Pharmalabs Limited March 31, 2011 Number Amount March 31, 2010 Number Amount
10 100 10 10 100,000
1,400,100 1,450,000 10,900,000 20,000,000
85,126,000 1,536,929,000 1,005,000,000
1,400,100 1,450,000 7,500,000 20,000,000 1,950
85,126,000 1,536,929,000 325,000,000 300,000,000 2,247,055,000 195,000,000
300,000,000 2,927,055,000 3,850 385,000,000
10
263,028
105,211,200 490,211,200
195,000,000
b.Current Investments Quoted , Non - Trade , Current (Valued at cost or market whichever is less) (refer note B-14 of Schedule L ) Unquoted, Non-Trade, Current (Valued at cost or market whichever is less) Reliance Mutual Fund Reliance Liquidity fund Axis Mutual Fund Axis Liquid Fund DWS Mutual Fund DWS Short Maturity FundInstitutional Growth Plan (refer note B-4 of Schedule L ) Total Aggregate cost of Mutual Fund Units Aggregate cost of Quoted investments Aggregate cost of Unquoted investments NAV of Mutual Fund Units Aggregate Market value of Quoted investments
234,607,988 234,607,988
10 1,000 10
87,860,573
1,000,497,891 1,000,497,891 4,417,764,091 1,000,497,891 3,417,266,200 1,030,358,506 -
49,983,628 200,019 -
500,066,208 200,019,204 700,085,412 3,376,748,400 700,085,412 234,607,988 2,442,055,000 700,085,412 252,421,955
29
An Overview

as at March 31, 2011 (Amount in `) As at March 31, 2011 Schedule F: Current Assets, Loans & Advances a. Cash And Bank Balance Cash on Hand Bank Balances With Scheduled Banks: - In Current Accounts - In Fixed deposits Total b) STOCK ON HAND (QUOTED) Equity Shares Selan Exploration Technology Limited HDFC Bank Limited Reliance Industries Limited United Phospherous Limited Stock on Hand - Options* Nifty Call 27-12-2012 Nifty Call 28-06-2012 Nifty Call 27-12-2012 Nifty Call 28-06-2012 Nifty Call 28-06-2012 Nifty Call 27-12-2012 Nifty Call 27-06-2013 Nifty Call 27-12-2012 Total Aggregate market value-stock on hand-Quoted
#
As at March 31, 2010
55
162,859,907 150,000,000 312,859,962 Qty (CY/PY)# Face Value As at 31.03.2011 87,352,207 53,113,780 27,498,412 14,423,200 9,936,000 1,488,000 984,000 10,121,413 13,597,500 5,318,750 223,833,262 245,294,050
1,015,599,411 1,015,599,411 As at 31.03.2010 78,549,241 14,423,200 5,850,000 1,508,400 8,041,000 5,321,347 113,693,188 126,195,450 Statutory Reports Business Discussion
- / 212,000 130,000 / 52,000 / 184,000 / Qty (CY/PY) 14,900 / 14,900 6,900 / 1,400/ 6,500 - / 1,800 24,800/ 8,500 24,800/ 24,800/ 5,750/ 5,750
10 10 10 2 Strike Price 5,000 4,100 5,100 5,100 5,200 5,200 5,200 5,300
*Held to cover possible payout in respect of certain Non- Convertible Debentures
CY= Current Year, PY= Previous Year
30

as at March 31, 2011 (Amount in `)

Schedule F (Contd.) c) Loans & Advances (Unsecured, Considered Good, unless otherwise stated) Loans to Group Companies Advance Income Tax & Tax Deducted at source (net of provisions) Loans Other Advances Less : Prov for doubtful loans Total Total 1,702,300,002 49,843,534 28,587,161,938 699,460,927 20,127,560 31,018,638,841 31,555,332,065
2,722,441,505 72,276,360 14,303,252,606 312,387,636 20,665,390 17,389,692,717 18,518,985,316
Schedule G: Current Liabilities And Provisions a)Current Liabilities Sundry Creditors i) Outstanding dues of micro and small enterprises. ii) Others Others Liabilities b)Provisions Contingent provision against standard assets Provision for leave encashment Total 71,501,232 374,970 71,876,202 2,093,071,655 141,484,458 12,599,906 2,008,595,548 2,021,195,453 141,484,458 141,484,458
Schedule H: Income From Operations Income from financing activities Profit from sale of Investments and trading activities Dividend income Total
4,013,920,347 193,319,092 48,348,882 4,255,588,321
1,364,879,729 140,579,407 118,462,251 1,623,921,387
31
An Overview
Schedules forming part of Profit and Loss account

for the year ended March 31, 2011 (Amount in `)
As at As at March 31, 2011 March 31, 2010

Schedule I: Direct Cost Investment and Financing Cost Provision for Doubtful Loans Provision for Standard Loans Marketing Expenses Total 65,839,504 (537,830) 71,501,232 94,836,678 231,639,584 140,508,094 4,398,890 31,240,304 176,147,288 Business Discussion
Schedule J: Employee Cost Salaries and bonus Contribution to provident and other funds Gratuity Staff Welfare Expenses Total
572,849,031 10,544,130 2,439,484 14,874,858 600,707,503
352,579,632 5,628,978 7,043,510 365,252,120
Schedule K: Administration and Other Expenses Advertisement Bank Charges Communication Electricity Legal & Professional Fees Miscellaneous Expenses Office expenses Postage & Courier Printing & Stationary Rent Repairs & Maintenance - Computer - Others Remuneration to Auditors : Audit Fees Certification Expenses Out Of Pocket Expenses Software Charges Travelling & Conveyance Total
64,116,587 1,256,175 25,966,239 18,595,798 63,076,949 4,390,966 26,469,543 12,644,484 16,625,743 141,343,422 499,136 8,882,562 225,000 31,000 8,950
62,838,733 152,380 22,120,183 13,244,268 41,205,962 5,637,228 14,420,261 7,102,773 6,824,795 60,680,725 217,890 4,292,657 225,000 2,727,112 12,007,237 253,697,204
Statutory Reports
9,381,698
264,950 16,115,972 32,028,097 432,276,623
32

SCHEDULE L
Significant Accounting Policies and Notes forming part of the Balance Sheet as at March 31, 2011 and Profit and Loss Account for the Year ended March 31, 2011.
A. SIGNIFICANT ACCOUNTING POLICIES: 1. Basis of preparation of financial statements: The financial statements have been prepared under historical cost convention on an accrual basis in compliance with all material aspects of the applicable Accounting Standards in India and the relevant provisions of the Companies Act, 1956. The accounting policies have been consistently applied by the Company. Use of Estimates: The presentation of financial statements in conformity with the generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual result and estimates are recognized in the period in which the results are known/ materialized. Fixed Assets and Depreciation: Fixed assets are stated at cost of acquisition less accumulated depreciation and impairment loss, if any thereon. Depreciation is charged using the straight line method based on the useful life of fixed assets as estimated by the management as specified below, or the rates specified in accordance with the provisions of schedule XIV of the Companies Act, 1956, whichever is higher. In the case of transfer of used fixed assets from group companies, depreciation is charged over the remaining useful life of the asset. Depreciation is charged from the month in which new assets are put to use. No depreciation is charged from the month in which assets are sold. Individual assets/ group of similar assets costing upto ` 5,000/- has been depreciated in full, in the year of purchase. Estimated useful life of the assets is as under: Buildings Computers Electrical & Office equipment Furniture and fixtures Vehicles Software 4. 20 years 3 years 5 years 5 years 5 years 3 years
2.
3.
Revenue Recognition: The Company complies, in all material respects, with the Prudential Norms relating to income recognition, accounting standards, asset classification and the minimum provisioning for bad and doubtful debts, specified in the directions issued by the Reserve Bank of India as applicable to it, and Interest Income is recognised on the time proportionate basis as per agreed terms. Interest income on non-performing assets is recognised on cash basis. Dividend income is recognised when the right to receive payment is established. In respect of the other heads of income, the Company accounts the same on accrual basis. Processing fees received from customers is recognised as income on receipt basis.
33
An Overview
5.
Preliminary Expenses Preliminary Expenses is written off in same financial year in which they are incurred. Retirement Benefits: The company's contribution towards Provident Fund and Family Pension Fund, which are defined contribution, are accounted for on an accrual basis and recognised in the Profit & loss account. The Company has provided Compensated Absences on the basis of actuarial valuation. Gratuity is post employment benefit and is in the nature of Defined Benefit Plan. The Liability recognized in the Balance Sheet in respect of gratuity is the present value of defined benefit obligation at the balance sheet date together with the adjustments for unrecognized actuarial gain or losses and the past service costs. The defined benefit obligation is calculated at or near the balance sheet date by an independent actuary using the projected unit credit method.
6.
7.
Provisions, Contingent Liabilities and Contingent Assets: The Company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made. Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed. Contingent Assets are neither recognized nor disclosed in the financial statements.
Business Discussion
8.
Taxes on Income: Provision for current tax is computed based on estimated tax liability computed after adjusting for allowance, disallowance and exemptions in accordance with the applicable tax laws. Deferred tax is recognized for all timing differences between accounting income & taxable income and is quantified using enacted / substantially enacted tax rates as at the balance sheet date. Deferred tax assets are recognized subject to the management judgement that the realisation is virtually / reasonably certain and are reviewed as at each balance sheet date.
9.
Operating Leases: Lease rentals in respect of operating lease arrangements are charged to the Profit & Loss Account in accordance with Accounting Standard 19 Leases, issued by the Institute of Chartered Accountants of India. Investments: Investments are classified into current and long-term investments. Investments which are intended to be held for one year or more are classified as long term Investments and investment that are intended to be held for less than one year are classified as current investments. Current investments are stated at lower of cost or market / fair value. Long-term investments are carried at cost. For investment in Mutual funds, the net Assets value (NAV) declared by the Mutual Funds is considered as the fair value. Provision for diminution in value of long term investments is made, if in the opinion of the management such diminution is other than temporary.
Statutory Reports
10.
11.
Stock in Trade: Closing stock is valued at cost or market value, whichever is lower. Cost is computed on FIFO basis.
B.
NOTES TO ACCOUNTS: 1. The Company is Non-Banking Financial Company registered with the Reserve Bank of India (RBI) under Section 45-IA of the Reserve Bank of India Act, 1934 and primarily engaged in lending and related activities. The Company has received the certificate of registration on May 12, 2005, enabling the Company to carry on business as Non Banking Financial Company. The Company Operates from and uses the premises, infrastructure and other facilities and services as provided to it by its
2.
34

holding company/ subsidiaries/ group companies which are termed as 'Shared Services'. Hitherto, such shared services consisting of administrative and other revenue expenses paid for by the company were identified and recovered from them based on reasonable management estimates, which are constantly refined in the light of additional knowledge gained relevant to such estimation. These expenses are recovered on an actual basis and the estimates are used only where actual were difficult to determine. 3. During the year, the Company has raised Term Loans aggregating ` 7,750,000,000/- from various banks. The same is secured against the receivables of the Company. The Company has also raised ` 2,783,200,000/- by issue of secured Non Convertible Debentures. The said debentures are secured against immovable property, stocks and book debts of the Company. The same are also guaranteed by India Infoline Limited, the holding company. These debentures are redeemable at par over a period of 12 months to 38 months from the date of allotment depending upon the terms of issue. Investment in DWS Short Maturity Fund- Institutional Growth Plan Units made by the Company is subject to pledge/lien of Deutsche Bank for overdraft facility provided to IIFL Realty Limited. Segment Reporting: In the opinion of the management, there is only one reportable business segment (Financing & Investing) as envisaged by AS 17 'Segment Reporting', issued by the Institute of Chartered Accountants of India. Accordingly, no separate disclosure for segment reporting is required to be made in the financial statements of the Company. Secondary segmentation based on geography has not been presented as the Company operates primarily in India and the Company perceives that there is no significant difference in its risk and returns in operating from different geographic areas within India. 6. 7. At the balance sheet date, there were outstanding commitments of capital expenditure of ` 92,639,763 (net of advances) (Previous Year Nil), out of the total contractual obligation entered upto the end of the year. The Company has implemented Employee Stock Option Scheme - 2007. Under the said scheme 5,825,000. Stock options are in force as on March 31, 2011. This is after augmentation of entitlement of bonus in ratio of 9:1 made during the financial year. Information under paragraphs 3 and 4 of part II to schedule VI of the companies Act, 1956 is stated to the extent applicable. There are no dues to micro & small enterprises (MSEs) outstanding for more than 45 days. Disclosures in respect of applicability of AS 18 Related Party Disclosures. Nature of relationship (a) Related parties where control exists: Holding Company Direct Subsidiaries India Infoline Limited Moneyline Credit Limited India Infoline Housing Finance Limited India Infoline Distribution Company Limited Fellow Subsidiaries India Infoline Commodities Limited India Infoline Media and Research Services Limited IIFL Capital Limited India Infoline Trustee Company Limited India Infoline Asset Management Company Limited India Infoline Marketing Services Limited Name of party
4. 5.
8. 9. 10.
35
An Overview
IIFL Wealth Management Limited IIFL Realty Limited IIFL (Asia) Pte. Limited IIFL Capital Ceylon Limited IIFL Securities Ceylon (Pvt) Limited IIFL Private Wealth Hong Kong Limited IIFL Private Wealth Management (Dubai) Limited India Infoline Commodities DMCC IIFL Inc. IIFL Wealth (UK) Limited Group Companies India Infoline Insurance Services Limited India Infoline Insurance Brokers Limited Finest Wealth Managers Private Limited IIFL Trustee Services Limited IIFL (Thane) Private Limited IIFL Energy Limited IIFL Capital Pte. Limited IIFL Securities Pte. Limited IIFL Private Wealth (Mauritius) Limited (b) Other related parties: Key Management Others (c) Significant Transaction with Related Parties: Holding Company 160,697,900 Interest Expenses Dividend Paid ICD repaid/ issued ICD taken/ received Purchase of Portfolio/ Foreclosures/ EMIs Sale of Portfolio 599,761,055 (18,627,693) 91,000,000 26,419,350 1,409,686,035 4,586,040,139 2,429,827,534 - (3,557,499,786) (131,506) Fellow Subsidiaries 223,185,232 (36,501,668) Group Companies Direct Subsidiaries Other related parties Nirmal Jain R Venkataraman India Infoline Venture Capital Fund (Amount in `) Total
Nature of Transaction Interest Income
383,883,132 (36,501,668) 599,761,055 (18,759,199) 117,419,350 1,409,686,035 (5,143,653,955) 2,429,827,534 (3,557,499,786) 4,586,040,139 (3,803,679,340) -
- (5,143,653,955)
- (3,803,679,340)
36

(Amount in `) Nature of Transaction Holding Company Brokerage Investment (net) Advances returned/ Advances taken/ allocation of expenses Closing balances Nature of Transaction Sundry receivables Holding Company Fellow Subsidiaries 1,702,300,003 - (2,722,441,502) Note: Figures in bracket represent previous year's figure. 11. The Company has taken office premises on operating lease at various locations. Lease rent in respect of the same have been charged to Profit and Loss account. The agreements are executed for a period ranging 1 to 5 years with a renewable clause. Some agreements have a clause for a minimum lock-in period. The agreements also have a clause for termination by either party giving a prior notice period between 30 to 90 days. The minimum Lease rentals outstanding as at March 31, 2011, are as under: (Amount in `) Minimum Lease Rentals Up to one year One to five years Over five years Total 12. 2010-11 2,734,940 666,000 Nil 3,400,940 2009-10 132,825 Nil Nil 132,825 Group Companies Direct Subsidiaries Other related parties Total 1,702,300,003 (2,722,441,502) 1,987,407 (276,588) 167,540,712,620 167,540,712,620 (35,619,195,525) reimbursement of expenses (35,619,195,525) Fellow Subsidiaries 5,847,741 5,847,741 Group Companies 576,024 576,024 Direct Subsidiaries (463,850,215) 680,000,000 5,817,797,631 517,797,631 Other related parties 190,000,000 Total (463,850,215) 1,987,407 (276,588) 870,000,000 (795,000,000) 173,364,934,016 (40,486,141,016) 173,364,934,016 (40,486,141,016)
(600,000,000) (195,000,000)
(31,998,900) (30,338,765) (4,804,607,826) (31,998,900) (30,338,765) (4,804,607,826)
The company recognized deferred tax assets since the management is reasonably/ virtually certain of its profitable operations in future. As per Accounting Standard 22 'Accounting for Taxes on Income', the timing differences mainly relates to following items and result in a net deferred tax asset: Deferred Tax Assets Sr. No. a. b. c. d. Particulars On Provision for Doubtful Debts On Provision for Standard assets On Depreciation On Gratuity Total As at 31.03.2011 6,685,872 23,750,922 (108,968) (281,754) 30,046,072 (Amount in `) As at 31.03.2010 7,024,166 137,281 7,161,447
37
An Overview
13.
The Company is recognising and accruing the employee benefit as per accounting standard (AS) 15 on Employee Benefits. Details are given below Assumptions Discount rate Salary Escalation Rate of return on plan assets Change in Benefit Obligation Liability at the beginning of the year Interest Cost Current Service Cost Liability Transferred in Benefit paid Actuarial (Gain)/ Loss on obligations Liability at the end of the year Amount Recognised in the Balance Sheet Liability at the end of the year Fair value of plan Assets at the end of the year Funded Status (Surplus) Net Asset recognised in the balance sheet Expenses Recognised in the Income statement Liability Transferred in Interest Cost Expected return on plan assets Benefit Paid Actuarial (Gain) or Loss Expense Recognised in P&L Balance Sheet reconciliation Opening Net liability Liability at the end of the year Employers contribution Benefit Paid Net Asset recognised in the balance sheet (2,439,484) 3,287,694 60,577 787,633 (3,010,576) 60,577 510,515 (2,439,484) (2,439,484) 3,227,117 787,633 787,633 (3,010,576) 60,577 510,515 (2,439,484) 2010-2011 8.0% 5.0% 8.0%
Business Discussion Statutory Reports FINANCIAL STATEMENTS
14.
Details of current Investments are as under: Quoted, Non - Trade, Current (valued at cost or market value whichever is lower) Scrip name Face value As at March 31, 2011 Numbers Aban Offhore Limited Aditya Birla Nuvo Limited 2 10 Amount (Amount in `) As at March 31, 2010 Numbers 6,278 6,121 Amount 7,298,489 5,547,462
38

Details of current Investments (Contd.) Scrip name Face value As at March 31, 2011 Numbers Anant Raj Industries Limited Ansal Properties & Infrastructure Limited Apollo Tyres Limited Bajaj Electricals Limited Bajaj Holding And Investment Limited C E S C Limited Eveready Industries India Limited Gayatri Projects Limited Glaxosmithkline Consumer Healthcare Limited Gujarat NRE Coke Limited HCL Infosystems Limited HCL Technologies Limited Housing Development and Infrastructure Limited ICICI Bank Limited India Cement Limited Indiabulls Financial Services Limited Indusind Bank Limited IVRCL Infrastructures & Projects Limited Jai Balaji Industries Limited Jindal South West Holding Limited Jyoti Structure Limited Lupin Limited Mahindra & Mahindra Limited Mercator Lines Limited Mindtree Limited Moser-Baer (India) Limited Patni Computer Systems Limited Piramal Healthcare Limited Prism Cement Limited Shree Renuka Sugars Limited Simplex Infrastructure Limited United Phosphorus Limited Voltas Limited Yes Bank Limited Zee Entertainment Enterprises Limited Total 2 5 1 2 10 10 5 10 10 10 2 2 10 10 10 2 10 2 10 10 10 10 5 1 10 10 2 2 10 1 2 2 1 10 1 Amount (Amount in `) As at March 31, 2010 Numbers 111,015 112,504 101,323 31,145 10,011 27,403 66,667 13,297 4,194 7,488 36,088 24,039 15,154 5,362 45,146 115,543 41,032 67,512 52,492 1,273 35,250 4,068 6,390 68,639 9,542 63,012 3,090 15,871 47,973 176,140 8,520 330,20 42,188 24,066 21,424 Amount 14,770,546 8,004,660 4,967,546 4,979,721 4,958,428 10,487,128 3,852,544 5,109,372 5,448,451 654,826 4,907,968 7,103,339 4,339,348 4,416,569 5,746,348 12,143,569 5,459,223 11,206,992 12,521,967 2,216,229 4,959,193 5,848,486 2,936,001 3,819,760 5,087,293 4,599,876 14,163,428 6,374,176 2,619,982 12,558,782 3,853,596 4,781,626 6,430,556 5,352,278 5,082,229 234,607,988
39
An Overview
15.
Basic and Diluted Earnings per share [EPS] computed in accordance with Accounting Standard (AS) 20 Earnings per share Particulars Basic Profit after tax as per Profit and Loss account Number of Shares Subscribed EPS (Rupees) Diluted Profit after tax as per Profit and Loss account Number of Shares Subscribed Add: Potential Equity Shares on Account conversion of Employees Stock Options Weighted Number of Shares Outstanding EPS (Rupees) D C/D C 82 6,577,291 475,504,290 237,154,030 237,154,030 5,825,000 8,591,164 A B A/B 826,577,291 475,504,290 237,154,030 237,154,030 3.49 2.01 2010-11 2009-10
Business Discussion
242,979,030 245,745,194 3.40 1.93
16.
Disclosure as required under Notification No. DNBS. 200/CGM(PK)-2008 dated 01 August 2008 issued by Reserve Bank of India a. Items CRAR (%) CRAR - Tier I Capital (%) CRAR - Tier II Capital (%) b. Exposure to Real Estate Current Year Capital Adequacy Ratio Current Year 29.95% 29.73% 0.22% Previous Year 47.65% 47.65% (` in mn)
Statutory Reports
Category a) Direct exposure (i) Residential Mortgages Lending fully secured by mortgages on residential property that is or will be occupied by the borrower or that is rented;Upto ` 1.5 mnMore than ` 1.5 mn (ii) Commercial Real Estate Lending secured by mortgages on commercial real estates (office buildings retail space multipurpose commercial premises multi-family residential buildings multi-tenanted commercial premises industrial or warehouse space hotels land acquisition development and construction etc.). Exposure would also include non-fund based (NFB) limits; (iii) Investments in Mortgage Backed Securities (MBS) and other securitised exposures a. Residential b. Commercial Real Estate b) Indirect Exposure Fund based and non-fund based exposures on National Housing Bank (NHB) and Housing Finance Companies (HFCs). 40
Previous Year
258.8 10,059.8 5,632.9
285.2 2,256.0 2,768.3
1,305.0
625.0

c. Maturity pattern of certain items of assets and liabilities Liabilities Borrowings from banks 1 day to 30/31 days (one month) Over one to 2 months Over 2 to 3 months Over 3 to 6 months Over 6 to 1 year Over 1 to 3 years Over 3 to 5 years Over 5 years Total 17. Asset classification Asset Classification Standard Assets Sub-Standard Assets Doubtful Assets Loss Assets Outstanding Balance 28,481,196,693 (14,235,605,863) 98,191,670 (54,362,482) 1,987,411 5,786,163 (13,284,261) Note: a. b. c. In terms of RBI circular a general provision of ` 71,501,232 (Previous Year: Nil) has been made during the year at 0.25 % of the Standard Assets under the head 'Provision on Standard loans' in the Profit & Loss account. Provision is created after considering credit for securities available against the loans. Figures in bracket represent previous year's figure. 18. Particulars as per RBI Directions (as required in terms of paragraph 13 of Non-Banking Financial (Non Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions 2007). (` in mn) Particulars Liabilities Side : 1. Loans and advances availed by the NBFCS inclusive of interest accrued there on but not paid : (a) Debentures: Secured Unsecured (Other than falling within the meaning of public deposits) (b) Deferred Credits 3,545.2 291.3 Amount Outstanding Amount Overdue 0.1 375.0 6,375.0 1,750.0 8,500.1 Market Borrowings 2,923.3 1,700.0 4,020.0 1,100.0 252.0 2,335.0 12,330.3 Assets Advances 9,436.7 868.9 1,279.7 1,588.9 648.1 6,112.3 2,175.9 8,908.0 31,018.6 Investments 1,105.7 3,312.1 4,417.8 (Amount in `) Provision 71,501,232 15,306,343 (6,067,143) 894,335 3,926,880 (13,284,261) (` in mn)
41
An Overview
(c) Term Loans (d) Inter corporate loans and borrowings (e) Commercial Paper (f) Other Loans (specify nature) Assets Side: 2. Break up of Loans and Advances including bills Receivables [Other than included in (4) below] (a) Secured (b) Unsecured Break- up of Leased Assets and stock on hire and other assets counting towards AFC activities (i) Lease assets including lease rentals under sundry debtors (a) Financial lease (b) Operating lease (ii) Stock on hire including hire charges under sundry debtors (a) Assets on hire (b) Repossessed Assets (iii) Other Loans counting towards AFC activities (a) Loans where assets have been repossessed (b) Loans other than (a) above 4. Break-up of Investments: Current Investments : 1 Quoted : (i) Shares: (a) Equity (b) Preference (ii) Debentures and Bonds (iii) Units of mutual funds (iv) Government Securities (v) Others (Commercial Deposits) 2 Unquoted: (i) Shares: (a) Equity (b) Preference (ii) Debentures and Bonds (iii) Units of mutual funds (iv) Government Securities (v) Others (please specify)
8,512.7 8,660.0 -
(` in mn)
Amount Outstanding 28,450.1 2,568.5
3.
Business Discussion
Statutory Reports
105.2 FINANCIAL STATEMENTS -
42

Long Term Investments: 1 Quoted: (i) Shares: (a) Equity (b) Preference (ii) Debentures and Bonds (iii) Units of mutual funds (iv) Government Securities (v) Others (please specify) 2 Unquoted: (i) Shares: (a) Equity (b) Preference (ii) Debentures and Bonds (iii) Units of mutual funds (iv) Government Securities (v) Others (please specify) India Infoline Venture Capital Fund 5. Borrower group-wise classification of all assets financed as in (2) and (3) above: Amount net of provisions Category 1. Related Parties** (a) Subsidiaries (b) Companies in the same group (c) Other related parties 2. Other than related parties Total 6. 28,450.1 28,450.1 1,702.3 866.2 2,568.5 1,702.3 29,316.3 31,018.6 (` in mn) Secured Unsecured Total 2,627.1 300.0 1,000.5 385.0 (` in mn) Amount Outstanding
Investor group wise classification of all investments (current and long term) in shares and securities (both quoted and unquoted) Market Value/ Break up or fair value or NAV 2,927.1 385.0 1,135.6 4,447.6
Category 1 Related Parties** a) Subsidiaries b) Companies in the same group c) Other related parties 2 Other than related parties Total **As per Accounting Standard of ICAI
Book value (net of provisions) 2,927.1 385.0 1,105.7 4,417.8
43
An Overview
7.
Other Information: Particulars (i) Gross Non-Performing Assets (a) Related parties (b) Other than related parties (ii) Net Non-Performing Assets (a) Related parties (b) Other than related parties (iii) Assets acquired in satisfaction of debt
(` in mn) Amount 106.0 85.8 -
Business Discussion
As per our attached report of even date For Sharp & Tannan Associates Chartered Accountants ICAI Registration No. 109983W By the hand of Tirtharaj Khot Partner Membership No. 37457 Place : Mumbai Dated : May 07, 2011 For India Infoline Investment Services Limited
44

Cash Flow Statement
for the year ended March 31, 2011 (Amount in `) Particulars CASH FLOWS FROM OPERATING ACTIVITIES Cash flows from operating activities Profit before taxation, and exceptional item Adjustments for: Depreciation Provision for Doubtful Loans Provision for Standard Loans Gratuity & Leave Enchasment Operating profit before working capital changes (Increase) / Decrease in Loans & Advances (Purchase)/Sale of Investments/ Stock on Trade Increase/ (Decrease) in Group company balances Increase/ (Decrease) in Current Liabilities Increase/ (Decrease) in Provisions Cash generated from operations Tax (Paid)/ Refund Net cash from operating activities Cash flows from investing activities Purchase of fixed assets Purchase of Investments (Subsidiaries) Net cash from investing activities (156,965,773) (680,000,000) (836,965,773) (600,000,000) (600,000,000) 8,510,416 (537,830) 71,501,232 3,896,043 1,277,792,029 (14,670,982,623) (471,155,766) 1,020,141,502 1,879,710,995 (3,521,073) (10,968,014,934) (368,296,677) (11,336,311,611) 634,405 4,398,890 667,488,964 (7,632,790,162) 2,246,249,302 (1,586,154,172) (823,176,904) (1,036,808) (7,129,419,780) (234,385,542) (7,363,805,322) 1,194,422,169 662,455,669 As at March 31, 2011 As at March 31, 2010
45
An Overview
Cash Flow Statement (Contd.)

for the year ended March 31, 2011 (Amount in `) Particulars Cash flows from financing activities Dividend paid Share issue expenses Proceeds of borrowings (net) Net cash used in financing activities Net increase in cash and cash equivalents Opening Cash and cash equivalents Cash on hand and balances with banks 1,015,599,411 1,015,599,411 Closing Cash and cash equivalents Cash on hand and balances with banks Net increase in cash and cash equivalents 312,859,962 (702,739,449) 1,015,599,411 741,294,678 274,304,733 274,304,733 (138,271,175) (16,500,000) 11,625,309,110 11,470,537,935 (702,739,449) 8,705,100,000 8,705,100,000 741,294,678 As at March 31, 2011 As at March 31, 2010
Business Discussion
1. 2.
Cash flow statement has been prepared under the Indirect Method as set out in the Accounting Standard (AS-3)"Cash Flow Statement" issued by the Institute of Chartered Accountants of India Previous year's figure are re-grouped \re-arranged, wherever necessary Statutory Reports
46

BALANCE SHEET ABSTRACT AND COMPANY'S GENERAL BUSINESS PROFILE
I. Registration Details Registration No. Balance Sheet Date II. Capital raised during the year Public Issue Bonus Issue N I 2 L 1 3 4 3 8 6 Rights Issue Private Placement 147365 March 31, 2011 (Amount in ` Thousands) N N I I L L State Code 1 1
III. Position of Mobilisation and Deployment of Funds Total Liabilities SOURCES OF FUNDS Paid-up Capital Secured Loans APPLICATION OF FUNDS Net Fixed Assets Net Current Assets Accumulated Losses IV. Performance of Company Turnover Profit/(Loss) Before Tax (Please tick Appropriate box + for Profit - for Loss ) Basic Earnings Per Share in Rs. V. + 4 1 5 1 1 9 9 4 0 4 5 2 9 2 Total Expenditure Profit/(Loss) After Tax 3 + 3 8 2 N 9 I 1 4 L 5 6 0 2 6 2 6 6 9 0 1 2 1 3 8 7 9 1 8 5 4 4 0 0 9 3 4 0 6 0 7 3 9 Total Assets SOURCES OF FUNDS Reserves & Surplus Unsecured Loans APPLICATION OF FUNDS Investments Deferred Tax Misc. Expenditure 4 4 1 0 8 8 9 3 4 0
(Amount in ` Thousands) 6 0 7 3 9
5 3
8 2
7 0
9 0
0 0
4 -
(Amount in ` Thousands) 2 2 4 6 6 5 3 7 7 7
Dividend
General Names of three Principal Products/ Services of Company (as per monetary terms) Item Code No. (ITC Code) Product Description Loan Company
47
An Overview
STATEMENT RELATING TO SUBSIDIARY COMPANIES PURSUANT TO APPROVAL GRANTED U/S 212 (8) OF THE COMPANIES ACT, 1956
(Amount in ` mn) Particulars 1 2 3 4 5 6 7 8 9 10 11 Equity Share Capital Reserves Total assets Total liabilities Investments (other than investment in subsidiaries) Total turnover Profit /(Loss) before taxation Provision for taxation (including deferred tax) Profit after taxation Extent of Interest in subsidiaries Proposed Dividend Moneyline India Infoline Distribution India Infoline Housing Credit Limited Company Limited Finance Limited 145.0 1,468.0 2,440.8 2,440.8 314.8 48.9 16.6 32.3 100.00% 14.0 59.1 73.8 73.8 0.0 67.0 6.2 6.8 (0.6) 100.00% 309.0 1,079.2 3,301.1 3,301.1 -
Business Discussion
294.0 90.9 26.7 64.2 100.00% -
48
Consolidated Financial Statements of India Infoline Investment Services Limited

Auditors Report on Consolidated Financial Statements
To The Board of Directors India Infoline Investment Services Limited Mumbai We report that on the basis of the information and explanation given to us and on the separate audit report on individual audited financial statements of the Group, we are of the opinion that the consolidated financial statements, read together with significant accounting policies and notes appearing thereon, give true and fair view in conformity with the accounting principles generally accepted in India: a) in the case of Consolidated Balance Sheet, of the state of affairs of the Group as at March 31, 2011; b) in the case of Consolidated Profit and Loss Account, of the profit of the Group for the year ended on that date; and c) in the case of the Consolidated Cash Flow Statement, of the Cash Flows of the Group for the year ended on that date.
Sub: Report on Consolidated Financial Statements as at March 31, 2011 We have audited the attached Consolidated Balance Sheet of India Infoline Investment Services Limited (the Company) and its subsidiaries namely, (1) India Infoline Distribution Company Limited, (2) India Infoline Housing Finance Limited, and (3) Moneyline Credit Limited (collectively referred to as the group), as at March 31, 2011, the Consolidated Profit and Loss Account and the consolidated Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management and have been prepared by the management on the basis of separate financial statements and other financial information regarding components. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion. We report that the consolidated financial statements have been prepared by the Companys management in accordance with the requirements of the Accounting Standard (AS) 21, Consolidated Financial Statements, issued by the Institute of Chartered Accountants of India, and on the basis of the separate audited financial statements of the Group included in the consolidated financial statements.
49
An Overview
Consolidated Balance Sheet

as at March 31, 2011 (Amount in `) Schedule SOURCES OF FUNDS Shareholders Funds Share Capital Reserves and Surplus Loan Fund Secured Loan Unsecured Loan Total APPLICATION OF FUNDS Goodwill (On Consolidation) Fixed Assets (Including Intangibles) Gross Block Less : Depreciation and Amortisation Net Block Capital Work-In-Progress Investments Deferred Tax Deferred Tax Assets Less: Deferred Tax Liabilities Current Assets, Loans and Advances Stock on Hand Sundry Debtors Cash and Bank Balances Loans and Advances Less : Current Liabilities & Provisions Current Liabilities Provisions As at March 31, 2011 As at March 31, 2010
A B C D
2,371,540,300 11,040,486,305 13,998,409,110 8,932,000,000
13,412,026,605
237,154,030 12,407,143,401 3,609,423,591 6,590,000,000
12,644,297,431
22,930,409,110 36,342,435,715 34,479,263
10,199,423,591 22,843,721,022 34,479,263
Business Discussion
E 158,164,895 (31,937,732) 126,227,163 37,492,392 F 44,385,805 G 223,833,262 5,749,788 1,136,206,627 35,977,821,965 37,343,611,642 H 2,651,330,583 83,164,058 2,734,494,641 34,609,117,001 36,342,435,715 677,769,429 4,134,908 681,904,337 21,638,162,044 22,843,721,022 113,693,188 10,189,090 2,060,932,935 20,135,251,168 22,320,066,381 49,478,438 (30,240,998) 19,237,440 -
163,719,555 1,490,734,091
19,237,440 1,129,789,400
44,385,805
22,052,875 -
22,052,875
Statutory Reports
Net Current Assets Total Significant Accounting policies and notes to Accounts N As per our attached report of even date For Sharp & Tannan Associates Chartered Accountants ICAI Registration No. 109983W By the hand of Tirtharaj Khot Partner Membership No. 37457 Place : Mumbai Dated : May 07, 2011 50
For India Infoline Investment Services Limited

Consolidated Profit & Loss Account
for the year ended March 31, 2011 (Amount in `) Schedule INCOME Income from Operations I Other Income J EXPENDITURE Direct cost K Employee cost L Administration & other expense M Interest Depreciation E Profit before tax Less: Provision for taxation - Current - Deferred tax (net) - Short Provision for Income Tax Profit after tax Net profit after tax for Available appropration Appropriations Dividend Dividend Distribution Tax Transfer to Special Reserve Transfer to General Reserve Balance of Profit brought forward from previous year Balance of Profit carried forward Earning Per Share - Basic Earning Per Share - Diluted Face Value Per Share Significant Accounting policies and notes to Accounts N 2010 - 2011 2009 - 2010
4,697,754,804 497,160,652 450,640,958 689,897,774 504,281,725 2,192,673,055 16,976,905
5,194,915,456
2,225,231,620 114,402,109 549,631,506 451,222,654 292,995,875 268,216,837 11,561,541
2,339,633,729
3,854,470,417 1,340,445,039 427,618,473 (22,332,930) 12,659,147 922,500,349 922,500,349 118,577,015 19,694,160 185,500,000 83,000,000 1,277,338,109 1,793,067,283 3.89 3.80 10.00
1,573,628,413 766,005,316 210,106,631 14,593,374 3,380,682 537,924,629 537,924,629 102,428,819 841,842,299 1,277,338,109 2.27 2.19 10.00
51
An Overview
Schedule forming part of the Consolidated Balance Sheet

as at March 31, 2011 (Amount in `) As at March 31, 2011 Schedule A: Share Capital Authorised : 300,000,000( Previous Year 50,000,000 ) Equity Shares of ` 10/- each Issued , Subscribed and Paid Up : (Includes 213,438,627 (Previous Year Nil) equity shares alloted by way of bonus as fully paid up shares by capitalisation of securities premium account (Out of above 182,000,000 (Previous Year 18,200,000) equity shares are held by its Holding Company India Infoline Limited and 52,838,700 (Previous Year 5,283,870) shares held by its fellow subsidiary) Total Schedule B: Reserves And Surplus Securities Premium Account Opening Balance Addition during the year Deduction during the year , for issue of bonus shares including share issue expenses Closing Balance General Reserve Opening Balance Addition during the year Closing Balance Special Reserve* Opening Balance Addition during the year Closing Balance *(pursuant to Section 45 1C of RBI Act,1934 and Section 29C of National Housing Bank Act, 1987) Profit and Loss Account Total Schedule C: Secured Loans Loans from Banks ( Secured against receivables ) Non Convertible Debentures (Secured Against Immovable Property, Stock & Book Debts) Total Refer Note : Schedule N- Part B Point 3 Schedule D: Unsecured Loans Non Convertible Debentures Commercial Paper Total Total Loan Fund As at March 31, 2010
3,000,000,000 2,371,540,300
500,000,000 237,154,030
Business Discussion
2,371,540,300
237,154,030
10,806,624,106 (2,150,886,270) 8,655,737,836 83,000,000 83,000,000 323,181,186 185,500,000 508,681,186 1,793,067,283
10,808,374,106 (1,750,000) 10,806,624,106 Statutory Reports 220,752,367 102,428,819 323,181,186 1,277,338,109
11,040,486,305 12,407,143,401
10,600,109,110 3,398,300,000 13,998,409,110
2,994,323,591 615,100,000 3,609,423,591
272,000,000 5,190,000,000 8,660,000,000 1,400,000,000 8,932,000,000 6,590,000,000 22,930,409,110 10,199,423,591
Secured and Unsecured loans include ` 10,937,109,110 (Previous Year ` 7,840,000,000) due in one year
52
Schedules Forming Part of The Consolidated Balance Sheet

(Amount in `) Gross Block (at Cost) Additions Deductions/ As at Adjustments 31.03.2011 during the year Upto 31.03.2010 For the year Deductions/ Adjustments during the year Upto 31.03.2011 As at 31.03.2011 Depreciation Net Block As at 31.03.2010
as at March 31, 2011
Schedule E: Fixed Assets
Assets
As at 31.03.2010
Tangible Assets 9,896,798 68,507,400 24,380,560 20,905,326 106,000 24,083,123 1,532,920 1,646,827 61,856 27,947,855 1,505,124 1,873,192 108,689 83,270,890 5,237,132 8,205,695 300,977 17,778,265 4,381,846 3,650,419 254,201 7,778,064 13,442,827 3,378,316 3,117,891 145,000 16,311 7,250 23,561 121,440 10,000,202 69,828,063 24,569,539 20,965,231 128,690 3,800,598 9,635,047 2,062,171 1,750,877
Premises
145,000
Computers
8,182,444
Furniture & Fixture
14,872,179
India Infoline Investment Services Limited Annual Report 2010-11 476,154 14,964,115 14,964,115 4,939,762 2,603,551 1,593,522 14,964,115 4,197,073 31,937,732 30,240,998 742,689 126,227,163 19,237,440 1,861,036 53,304,136 49,478,438 64,868,164 11,561,541 46,188,706
Office Equipments
3,567,295
Electrical Equipments
3,283,797
53
Intangible Assets 1,860,057 19,237,440
Software
4,463,608
Non Compete Fees
14,964,115
Grand Total
49,478,438 124,166,238 15,479,781 158,164,895 30,240,998 16,976,905 15,280,172
Previous Year
100,921,539
An Overview

as at March 31, 2011 (Amount in `) Face Value Schedule F: Investments Quoted , Non - Trade , Current (valued At cost or market value whichever is lower) Equity Shares (Schedule N- Part B Point 15 ) Un-Quoted,Non Trade,Long Term (Valued at cost ) Units of India Infoline Venture Capital Fund ( IIFL Opportunity ) Arch pharma Limited Unquoted, Non Trade, Current, Valued At Market Price/Cost whichever is lower Birla Sunlife Mutual Fund Birla Income plus Plan -B Growth Birla Mid-Cap Fund Plan B : Growth Reliance Mutual Fund Reliance Liquidity fund Axis Mutual Fund Axis Liquid Fund DWS Mutual Fund DWS Short Maturity Fund - Institutional Growth Plan (Schedule N- Part B Point 4) Quantity As at 31.03.2011 Quantity As at 31.03.2010
1 00 000 10 3,850 263,028 385,000,000 105,211,200 490,211,200 1,950 -
234,607,988 234,607,988 195,000,000 195,000,000 Business Discussion
10 10 10 10 10
105,467,142
25,000 -
25,000 71,000 500,066,208 200,019,204 700,181,412 1,129,789,400 700,181,412 234,607,988 195,000,000 700,181,412 252,421,955
- 49,983,628 1,000,497,891 1,000,522,891 1,490,734,091 1,000,522,891 490,211,200 1,030,358,506 200,019 -
Statutory Reports
Aggregate cost of Mutual Fund Units Aggregate cost of Quoted investments Aggregate cost of Unquoted investments NAV of Mutual Fund Units Aggregate Market value of Quoted investments
54

as at March 31, 2011 (Amount in `) As at March 31, 2011 Schedule G: Current Assets, Loans & Advances a. Current Assets I ) Sundry Debtors ( Unsecured , Considered good, unless otherwise stated) Less than 6 Months - Unsecured and considered good Current Assets II ) Stock on Hand ( Cost or Market price whichever is less ) Equity Shares Selan Exploration Technology Limited HDFC Bank Limited Reliance Industries Limited United Phospherous Limited Stock On Hand - Options Nifty Call 27-12-2012 Nifty Call 28-06-2012 Nifty Call 27-12-2012 Nifty Call 28-06-2012 Nifty Call 28-06-2012 Nifty Call 27-12-2012 Nifty Call 27-06-2013 Nifty Call 27-12-2012 Aggregate market value- Quoted III) Cash and Bank Balance Cash on Hand Bank Balances With Schedule Banks : In Current Accounts In Fixed Deposits As at March 31, 2010
5,749,788 5,749,788 Units / Shares Rate
10,189,090 10,189,090
- / 212,000 130,000 / 52,000 / 184,000 / Units / Shares 14,900 / 14,900 6,900 / 1,400 / 6,500 - / 1,800 24,800 / 8,500 24,800 / 24,800 / 5,750 / -
10 10 10 2 Strike Price 5,000 4,100 5,100 5,100 5,200 5,200 5,200 5,300
87,352,207 53,113,780 27,498,412 14,423,200 9,936,000 1,488,000 984,000 10,121,413 13,597,500 5,318,750 223,833,262 245,294,050 279,502,969 411,172,022 445,531,636 1,136,206,627
78,549,241 14,423,200 7,358,400 8,041,000 5,321,347
113,693,188 126,195,450 536,450 1,691,390,341 369,006,144 2,060,932,935
55
An Overview

as at March 31, 2011 (Amount in `)

Schedule G: Current Assets, Loans & Advances (CONTD.) b.Loans And Advances (Unsecured , Considered good, unless otherwise stated) Loans to Group Companies Advances recoverable in cash or in kind or for value to be received Other Deposits Advance Income Tax , Refund & Tax Deducted at Source (net of provisions) Loans & Advances - Financing activity Other Loans & Advances Less: Provision for doubtful Loans
1,922,300,002 390,088,051 9,987,882 75,403,901 32,889,735,854 717,194,650 (26,888,375) 35,977,821,965 37,343,611,642
2,942,490,328 277,883,208 9,538,035 90,656,090 16,267,831,903 571,711,705 (24,860,101) 20,135,251,168 22,320,066,381
Business Discussion
Schedule H: Current Liabilities And Provisions a. Current Liabilities i) Sundry Creditors Outstanding dues of micro and small enterprises. Others ii) Other Liabilities b. Provisions Contingent provision against standard assets Provision for gratuity Provision for leave Encashment Total
12,605,512 2,638,725,071 2,651,330,583 82,496,463 667,595 83,164,058 2,734,494,641
55,107 677,714,322 677,769,429 Statutory Reports 3,051,546 1,083,362 4,134,908 681,904,337
56

As at As at March 31, 2011 March 31, 2010

Schedule I: Income from Operations Income from Operation Profit from sale of Investments and trading activities Income from Financing Activities Dividend income Total
193,595,650 96,706,954 4,455,810,272 2,010,062,414 48,348,882 118,462,252 4,697,754,804 2,225,231,620
Schedule J: Other Income Miscelleneous income Interest on Fixed Deposits (Gross) Processing fee Administration fee & other charges from customer Profit / (loss) on sale of fixed assets Total
66,711,287 24,772,230 347,532,538 58,144,598 497,160,653
3,885,473 17,589,733 56,228,528 36,709,122 (10,747) 114,402,109
Schedule K: Direct Cost Marketing and commission expenses Provision for Doubtful Loans Provision for Standard Loans Provision for Standard Loans-Teasers Investment and financing related cost Total
195,388,897 2,028,274 80,141,605 2,224,858 170,857,324 450,640,958
57,729,317 8,193,602 483,708,587 549,631,506
Schedule L: Employee Cost Salaries and bonus Contribution to provident Fund and other funds Gratuity Staff welfare expenses Leave encashment Total
656,533,273 11,329,111 1,069,761 19,980,083 985,546 689,897,774
434,253,402 6,852,560 1,398,065 9,809,669 (1,091,042) 451,222,654
57
An Overview


Schedule M: Administrative And Other Expenses Advertisement expenses Bad Debts Bank charges Communication expenses Electricity expenses Legal and professional charges Miscellaneous expenses Office expenses Postage and courier Premises expenses Printing and stationery Repairs and maintenance Computers Others Remuneration to auditors Audit Fees Certification work and other matters Out of pocket expenses Software charges Travelling and conveyance Total 65,955,379 5,351,960 30,322,001 28,686,149 71,258,299 7,167,574 37,532,081 13,547,082 155,124,478 22,112,881 499,136 12,256,597 395,000 73,000 21,987 16,255,952 37,722,169 504,281,725
As at March 31, 2010 60,427,237 1,608,928 744,003 26,186,317 15,924,561 47,432,205 6,874,078 15,387,425 7,778,227 73,526,963 7,679,343 217,890 5,828,809 397,932 15,000 3,424,072 19,542,885 292,995,875
58

SCHEDULE N
Significant Accounting Policies and Significant Notes to the Consolidated Statement of Balance Sheet as at March 31, 2011 and Profit and Loss Account for the year ended March 31, 2011.
A. SIGNIFICANT ACCOUNTING POLICIES: 1. Basis of Consolidation: a. Basis of Preparation: The individual Balance Sheet and Profit and Loss Account of India Infoline Investment Services Limited ('the Company') and its subsidiaries ('companies and/ or subsidiaries'), collectively referred to as 'Group', have been consolidated as per principles of consolidation enunciated in Accounting Standard (AS) 21- 'Consolidated Financial Statements' issued by the Council of The Institute of Chartered Accountants of India. b. Principles of Preparation: The financial statements of the group companies of India Infoline Investment Services Limited are prepared according to uniform accounting policies, in accordance with accounting principles generally accepted in India. The effects of all inter-group transactions and balances have been eliminated on consolidation. c. List of Subsidiaries Consolidated: The individual Balance Sheet as at March 31, 2010 and Profit and Loss Account for the year ended March 31, 2010 of following subsidiaries are included in consolidation. India Infoline Distribution Company Limited (IIDCL) India Infoline Housing Finance Limited (IIHFL) Moneyline Credit Limited. 2. Basis of preparation of financial statements: The financial statements have been prepared under historical cost convention on an accrual basis. Use of Estimates: The presentation of financial statements in conformity with the generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual result and estimates are recognized in the period in which the results are known / materialized. Revenue Recognition: The Company complies, in all material respects, with the Prudential Norms relating to income recognition, accounting standards, asset classification and the minimum provisioning for bad and doubtful debts, specified in the directions issued by the Reserve Bank of India / NHB as applicable to it, and 5. Interest Income is recognised on the time proportionate basis as per agreed terms. Interest income on non-performing assets is recognised on cash basis. Dividend income is recognised when the right to receive payment is established. In respect of the other heads of income, the Company accounts the same on accrual basis. Processing fees received from customers is recognised as income on receipt basis.
3.
4.
Fixed Assets and Depreciation: Fixed assets are stated at cost of acquisition less accumulated depreciation and impairment loss, if any thereon. Depreciation is charged using the straight line method based on the useful life of fixed assets as estimated by the management as specified below, or the rates specified in accordance with the provisions of schedule XIV of the Companies Act, 1956, which-ever is higher. In the case of transfer of used fixed assets from group companies, depreciation is charged over the remaining useful life of the asset. Depreciation is charged from the month in which new assets are put to use. No depreciation is charged from the month in India Infoline Investment Services Limited Annual Report 2010-11
59
An Overview
which assets are sold. Individual assets / group of similar assets costing upto Rs.5,000/- has been depreciated in full, in the year of purchase. Estimated useful life of the assets is as under: Buildings Computers Electrical & Office equipment Furniture and fixtures Vehicles Software 6. 20 years 3 years 5 years 5 years 5 years 3 years
Business Discussion
Investments: Investments are classified into current and long-term investments. Investments which are intended to be held for one year or more are classified as long term Investments and investment that are intended to be held for less than one year are classified as current investments. Current investments are stated at lower of cost or market/ fair value. Long-term investments are carried at cost. For investment in Mutual funds, the Net Assets Value (NAV) declared by the Mutual Funds is considered as the fair value. Provision for diminution in value of long term investments is made, if in the opinion of the management such diminution is other than temporary.
7.
Stock in Trade: Closing stock is valued at cost or market value, whichever is lower. Cost is computed on FIFO basis. Retirement Benefits: The company's contribution towards Provident Fund and Family Pension Fund, which are defined contribution, are accounted for on an accrual basis and recognised in the Profit & Loss account. Statutory Reports The Company has provided compensated absences on the basis of actuarial valuation. Gratuity is post employment benefit and is in the nature of Defined Benefit Plan. The Liability recognized in the Balance Sheet in respect of gratuity is the present value of defined benefit obligation at the balance sheet date together with the adjustments for unrecognized actuarial gain or losses and the past service costs. The defined benefit obligation is calculated at or near the balance sheet date by an independent actuary using the projected unit credit method.
8.
9.
Provisions, Contingent Liabilities and Contingent Assets: The Company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made. Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed. Contingent Assets are neither recognized nor disclosed in the financial statements. FINANCIAL STATEMENTS
10.
Taxes on Income: Provision for current tax is computed based on estimated tax liability computed after adjusting for allowance, disallowance and exemptions in accordance with the applicable tax laws. Deferred tax is recognized for all timing differences between accounting income & taxable income and is quantified using enacted/ substantially enacted tax rates as at the balance sheet date. Deferred tax assets are recognized subject to the management judgement that the realisation is virtually / reasonably certain and are reviewed as at each balance sheet date. 60

11. Operating Leases: Lease rentals in respect of operating lease arrangements are charged to the Profit & Loss Account in accordance with Accounting Standard 19 Leases, issued by the Institute of Chartered Accountants of India. Preliminary Expenses: Preliminary Expenses are written off in the financial year in which it is incurred.
12.
B.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS: 1. The Company operates from and uses the premises, infrastructure and other facilities and services as provided to it by its holding company/ subsidiaries/ group companies which are termed as 'Shared Services'. Hitherto, such shared services consisting of administrative and other revenue expenses paid for by the company were identified and recovered from them based on reasonable management estimates, which are constantly refined in the light of additional knowledge gained relevant to such estimation. These expenses are recovered on an actual basis and the estimates are used only where actual were difficult to determine. At the balance sheet date, there were outstanding commitments (net of advances) of capital expenditure of ` 93,176,908 (Previous Year ` 116,500) out of the total contractual obligation entered during the year. During the year, the Company has raised Term Loans aggregating ` 9,350,000,000 from various banks. The same is secured against the receivables of the Company. The Company has also raised ` 2,783,200,000 by issue of secured Non Convertible Debentures. The said debentures are secured against immovable property, stocks and book debts of the Company. The same are also guaranteed by India Infoline Limited, the holding company. These debentures are redeemable at par over a period of 12 months to 38 months from the date of allotment depending upon the terms of issue. DWS Short Maturity Fund- Institutional Growth Plan Units are subject to pledge/ lien of Deutche Bank for overdraft facility provided to IIFL Realty Limited. The Company has implemented Employee Stock Option Scheme - 2007. Under the said scheme 5,825,000. Stock options are in force as on March 31, 2011. This is after augmentation of entitlement of bonus in ratio of 9:1 made during the financial year. Segment Reporting: In the opinion of the management, there is only one reportable business segment (Financing and Investing) as envisaged by AS 17 'Segment Reporting', issued by the Institute of Chartered Accountants of India. Accordingly, no separate disclosure for segment reporting is required to be made in the financial statements of the Company. Secondary segmentation based on geography has not been presented as the Company operates primarily in India and the Company perceives that there is no significant difference in its risk and returns in operating from different geographic areas within India. 7. The company recognized deferred tax assets since the management is reasonably/ virtually certain of its profitable operations in future. As per Accounting Standard 22 'Accounting for Taxes on Income', the timing differences mainly relates to following items and result in a net deferred tax asset: Deferred Tax Asset Particulars Depreciation On Gratuity/ Leave Encashment Provision for doubtful debts Provision for Standard Assets Preliminary Expenses Other Total 2010-2011 3,142,078 (504,157) 8,931,646 26,894,535 5,921,703 44,385,805 2009-2010 7,188,655 1,037,220 8,449,948 17,199 5,359,853 22,052,875
2. 3.
4. 5.
6.
61
An Overview
8.
Disclosures in respect of applicability of AS 18 Related Party Disclosures. Nature of relationship (a) Related parties where control exists: Holding Company Fellow Subsidiaries India Infoline Limited India Infoline Commodities Limited India Infoline Media and Research Services Limited IIFL Capital Limited India Infoline Trustee Company Limited India Infoline Asset Management Company Limited India Infoline Marketing Services Limited IIFL Wealth Management Limited IIFL Realty Limited IIFL (Asia) Pte. Limited IIFL Capital Ceylon Limited IIFL Securities Ceylon (Pvt) Limited IIFL Private Wealth Hong Kong Limited IIFL Private Wealth Management (Dubai) Limited India Infoline Commodities DMCC IIFL Inc. IIFL Wealth (UK) Limited Group Companies India Infoline Insurance Services Limited India Infoline Insurance Brokers Limited Finest Wealth Managers Private Limited IIFL Trustee Services Limited IIFL (Thane) Private Limited IIFL Energy Limited IIFL Capital Pte. Limited IIFL Securities Pte. Limited IIFL Private Wealth (Mauritius) Limited (b) Other related parties: Key Management Others Nirmal Jain R Venkataraman India Infoline Venture Capital Fund Name of party
9. Nature of Transaction
Significant Transaction with Related Parties (Figures in bracket represent previous year's figure) Holding Company 160,697,900 599,761,055 (18,627,693) Fellow Subsidiaries 223,185,232 (36,555,915) (60,681,783) 62 Group Companies 19,824,583 Other related parties Total 403,707,716 (36,555,915) 599,761,055 (79,309,476)
Interest Income on ICD Interest Expenses on ICD

Significant Transaction with Related Parties (Contd.) Dividend Paid Brokerage Hire Charges Income Sale of Fixed Assets (Net Block) Investments ICD repaid/issued ICD taken/received Advances returned/ reimbursement of expenses Advances taken/ allocation of expenses 91,000,000 1,987,407 (276,588) 167,717,013,891 (35,982,603,865) 167,717,013,891 (35,982,603,864) (3,600,000) (6,388,256) 1,409,686,035 2,429,827,534 7,433,163 (76,608,887) 7,433,163 (38,387,156) 220,000,000 220,000,000 (51,514,394) 60,275,347 (45,499,014) 60,275,347 (45,499,014) 190,000,000 (195,000,000) 26,419,350 117,419,350 1,987,407 (276,588) (3,600,000) (6,388,256) 190,000,000 (195,000,000) 1,629,686,035 (7,172,064,445) 2,649,827,534 (3,609,014,180) 16,778,472,2401 (36,104,711,766) 167,784,722,401 (36,066,490,034)
(5,363,702,777) (1,808,361,668) - (3,557,499,786)
Nature of Transaction Sundry receivables
Holding Company
Fellow Subsidiaries 1,702,300,003 (2,722,441,502)
Group Companies 220,000,000 (220,048,822)
Other related parties
Total 1,922,300,003 (2,942,490,324)
10.
The summary of consolidated Financial Statements represents consolidation of accounts of the Company with its following subsidiaries, all incorporated within India, as detailed below: Subsidiary Proportion of ownership interest 31.03.2011 India Infoline Distribution Company Limited India Infoline Housing Finance Limited Moneyline Credit Limited 100% 100% 100% 31.03.2010 100% 100% 100%
11.
The Company has taken office premises on operating lease at various locations. Lease rent in respect of the same have been charged to Profit and Loss account .The agreements are executed for a period ranging 1 to 5 years with a renewable clause. Some agreements have a clause for a minimum lock-in period. The agreements also have a clause for termination by either party giving a prior notice period between 30 to 90 days. The Company has also taken some other assets under operating lease. The minimum Lease rentals outstanding as at March 31, 2011, are as under: Minimum Lease Rentals Up to one year One to five years Over five years Total 63 2010-11 2,734,940 666,000 Nil 3,400,940 2009-10 3,142,825 Nil Nil 3,142,825
An Overview
12. 13. 14.
Information under paragraphs 3 and 4 of part II to schedule VI of the companies Act, 1956 is stated to the extent applicable. There are no dues to Micro and small enterprises (MSEs) outstanding for more than 45 days. Basic and Diluted Earnings per share [EPS] computed in accordance with Accounting Standard (AS) 20 'Earnings per share PARTICULARS Basic Profit after tax as per Profit and Loss account Number of Shares Subscribed EPS (Rupees) Diluted Profit after tax as per Profit and Loss account Number of Shares Subscribed Add: Potential Equity Shares on Account conversion of Employees Stock Options. Weighted Number of Shares Outstanding EPS (Rupees) C 922,500,349 237,154,030 5,825,000 242,979,030 3.80 537,924,629 A B A/B 922,500,349 237,154,030 3.89 537,924,629 237,154,030 2.27 2009-2010 2009-2010
Business Discussion
237,154,030 8,591,164 245,745,194 2.19
15.
Details of Current Investments: Quoted, Non - Trade, Current (valued At cost or market value whichever is lower) Scrip name Face value As at March 31, 2011 Numbers Aban Offhore Limited Aditya Birla Nuvo Limited Anant Raj Industries Limited Ansal Properties & Infrastructure Limited Apollo Tyres Limited Bajaj Electricals Limited Bajaj Holding And Investment Limited C E S C Limited Eveready Industries India Limited Gayatri Projects Limited Glaxosmithkline Consumer Healthcare Limited Gujarat Nre Coke Limited HCL Infosystems Limited HCL Technologies Limited Housing Development And Infrastructure Limited ICICI Bank Limited India Cement Limited Indiabulls Financial Services Limited Indusind Bank Limited IVRCL Infrastructures & Projects Limited Jai Balaji Industries Limited 2 10 2 5 1 2 10 10 5 10 10 10 2 2 10 10 10 2 10 2 10 64 Amount As at March 31, 2010 Numbers 6,278 6,121 111,015 112,504 101,323 31,145 10,011 27,403 66,667 13,297 4,194 7,488 36,088 24,039 15,154 5,362 45,146 115,543 41,032 67,512 52,492 Amount 7,298,489 5,547,462 14,770,546 8,004,660 4,967,546 4,979,721 4,958,428 10,487,128 3,852,544 5,109,372 5,448,451 654,826 4,907,968 7,103,339 4,339,348 4,416,569 5,746,348 12,143,569 5,459,223 11,206,992 12,521,967 FINANCIAL STATEMENTS Statutory Reports

Scrip name Face value As at March 31, 2011 Numbers Jindal South West Holding Limited Jyoti Structure Limited Lupin Limited Mahindra & Mahindra Limited Mercator Lines Limited Mindtree Limited Moser-Baer (India) Limited Patni Computer Systems Limited Piramal Healthcare Limited Prism Cement Limited Shree Renuka Sugars Limited Simplex Infrastructure Limited United Phosphorus Limited Voltas Limited Yes Bank Limited Zee Entertainment Enterprises Limited Total 16. 10 10 10 5 1 10 10 2 2 10 1 2 2 1 10 1 Amount As at March 31, 2010 Numbers 1,273 35,250 4,068 6,390 68,639 9,542 63,012 30,190 15,871 47,973 176,140 8,520 33,020 42,188 24,066 21,424 Amount 2,216,229 4,959,193 5,848,486 2,936,001 3,819,760 5,087,293 4,599,876 14,163,428 6,374,176 2,619,982 12,558,782 3,853,596 4,781,626 6,430,556 5,352,278 5,082,229 234,607,988
Figures pertaining to subsidiary companies have been reclassified wherever necessary to bring them in line with parent company's financial statements. Previous year's figures are regrouped and rearranged wherever necessary.
17.
65
An Overview
Consolidated Cash Flow Statement

for the year ended March 31, 2011 (Amount in `) Particulars CASH FLOWS FROM OPERATING ACTIVITIES Net profit before taxation, and extraordinary item Adjustments for: Depreciation Provision for Doubtful Loans Provision for Standard Loans Provisions for Gratuity Provisions for Leave Encashment Operating profit before working capital changes (Increase) / Decrease in Sundry Debtors (Increase) / Decrease in Loans & Advances (Purchase)/Sale of Investments/Stock on Trade Increase / (Decrease) in Group Company balances Increase / (Decrease) in Current Liabilities Increase / (Decrease) in Provisions Cash generated from operations Tax (Paid) / Refund Net cash from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Purchase of fixed assets Sale of fixed assets Net cash from investing activities (161,459,021) (161,459,021) 6,160,304 6,160,304 16,976,905 2,028,274 82,496,463 1,069,761 985,546 1,444,001,987 4,439,302 (16,880,041,584) (471,084,766) 1,020,190,326 1,973,561,153 (5,522,619) (12,914,456,201) (425,025,431) (13,339,481,632) 11,561,541 8,593,632 1,398,065 (1,091,042) 786,467,512 (2,859,782) (7,105,439,813) 2,246,249,303 (1,806,202,995) (548,918,498) (3,698,888) (6,434,403,162) (259,129,584) 1,340,445,039 766,005,316 As at March 31, 2011 As at March 31, 2010
(6,693,532,746)
66

Consolidated Cash Flow Statement (Contd.)
for the year ended March 31, 2011 (Amount in `) Particulars CASH FLOWS FROM FINANCING ACTIVITIES Share issue expenses Dividend paid Proceeds from borrowings (net) Net cash used in financing activities Net increase in cash and cash equivalents Opening Cash and cash equivalents Cash on hand and balances with banks 2,060,932,935 2,060,932,935 Closing Cash and cash equivalents Cash on hand and balances with banks Net increase/ Decrease in cash and cash equivalents 1,136,206,627 (924,726,308) 2,060,932,935 1,253,453,873 807,479,062 807,479,062 (16,500,000) (138,271,175) 12,730,985,519 12,576,214,345 (924,726,308) (1,750,000) 7,942,576,316 7,940,826,315 1,253,453,873 As at March 31, 2011 As at March 31, 2010
1. 2.
Cash flow statement has been prepared under the Indirect Method as set out in the Accounting Standard (AS-3)"Cash Flow Statement" issued by the Institute of Chartered Accountants of India Previous year's figure are re-grouped \re-arrange wherever necessary
67
CORPORATE INFORMATION
BOARD OF DIRECTORS A K Purwar Non Executive Chairman Nirmal Jain Director R. Venkataraman Director Nilesh Vikamsey Independent Director M N Singh Independent Director Kapil Krishan Whole Time Director Pratima Ram Whole Time Director & Chief Executive Officer CORE MANAGEMENT TEAM Mukesh Kumar Singh Head Gold Loan Business Sachin Grover Head Mortgage Business Abhishek Khandelwal Head - Structured Lending Group Priya Kashyap Head Credit Policy S Venu Head Operation COMPANY SECRETARY Binoy K Parikh COMMITTEE OF BOARD Audit Committee Nilesh Vikamsey - Chairman M N Singh Kapil Krishan Pratima Ram Nomination Committee M N Singh Nilesh Vikamsey Nirmal Jain R Venkataraman Risk Management Committee A K Purwar Nilesh Vikamsey Nirmal Jain L P Aggarwal Assets Liability Management Committee A K Purwar Nirmal Jain Pratima Ram L P Aggarwal Kapil Krishan AUDITORS M/s Sharp & Tannan Associates Chartered Accountants INTERNAL AUDITORS M/s Ernst & Young LAWYERS Khaitan & Co. REGISTRAR AND SHARE TRANSFER AGENT Link Intime India Pvt. Ltd C-13, Pannalal Silk Mills compound, L.B.S. Marg, Bhandup (West), Mumbai 400 078 Cautionary Statement This document contains forward-looking statement and information. Such statements are based on our current expectations and certain assumptions, and are, therefore, subject to certain risk and uncertainties. Should one or more of these risks or uncertainties materialise, or should underlying assumptions prove incorrect, actual results may vary. IIISL does not intend to assume any obligation or update or revise these forward-looking statements in light of developments, which differs from those anticipated. REGISTERED OFFICE IIFL House, Sun Infotech Park Road no. 16, Plot no. B-23, MIDC, Thane Industrial Estate, Wagle Estate, Thane 400 604 CORPORATE OFFICE IIFL Centre, Kamala City, Lower Parel (West), Mumbai 400 013 BANKERS Allahabad Bank Axis Bank Ltd Bank of Baroda Bank of India Citibank N.A. HDFC Bank Ltd Development Credit Bank Ltd The Federal Bank Ltd The Hongkong and Shanghai Banking Corporation Ltd ICICI Bank Ltd IDBI Bank Ltd Kotak Mahindra Bank Ltd Punjab National Bank Ltd Standard Chartered Bank State Bank of India State Bank of Travancore UCO Bank Union Bank of India Yes Bank Ltd

IIISL Annual Report Final

Hochgeladen von

Dokumentinformationen

Originalbeschreibung:

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

IIISL Annual Report Final

Hochgeladen von

Copyright:

Verfügbare Formate

Lets Explore the Loan Zone with IIISL...

INDIA INFOLINE INVESTMENT SERVICES LIMITED (IIISL)

INSIDE THIS REPORT

Standalone Financial Statements

Consolidated Financial Statements

PERFORMANCE HIGHLIGHTS (Consolidated) 2010-11

Net Interest Income

1,847.8 2.4 1.6 781.3 2.3

Profit after Tax

922.5 13.4 691.2 12.6 537.9 12.1 11.4 239.4

India Infoline Investment Services Limited Annual Report 2010-11

Earning per Share

Book Value per Share

2.9 2.3 1.6 47.9 51.1

0.71 0.60 0.44 0.45

16.3 0.08 9.4 9.6

A. K. Purwar, Non-Executive Chairman, IIISL

India Infoline Investment Services Limited Annual Report 2010-11

Statutory Reports Financial Statements

India Infoline Investment Services Limited Annual Report 2010-11

FILINGS AND LISTINGS

SPREADING THE LIGHT OF FINANCIAL LITERACY

FLAME - An IIFL Group Initiative

Dr. K C Chakrabarty, Deputy Governor, RBI

Launch of the FLAME book

Mr. Deepak Parekh, Chairman, HDFC Launch of FLAME Campaign by FLAME

FLAME (Financial Literacy Agenda for Mass Empowerment)

India Infoline Investment Services Limited Annual Report 2010-11

Financial Literacy Campaign in leading newspapers

IIFL publication - 108 Mantras for Financial Success

Statutory Reports Financial Statements

IIFL FLAME Meet at Bhavnagar, Gujarat

FLAME portal www.flame.org.in is dedicated to the cause of spreading financial literacy

Credit and Finance

Commercial banks share in business and consumer lending

NON-BANKING FINANCE COMPANIES (NBFCS)

India Infoline Investment Services Limited Annual Report 2010-11

Mortgage Loans/ GDP ratio

95% BUSINESS DISCUSSION

48% 39% 41% 26% 17% 9% 20% 29% 32%

Source: European Mortgage Federation, 2010, World Bank, 2010

LOAN AGAINST PROPERTY

HOUSING FINANCE SECTOR

LOAN AGAINST CAPITAL MARKET INSTRUMENTS

HEALTHCARE FINANCING MARKET

GOLD LOAN MARKET

RETAIL FINANCE DISBURSEMENTS

Consumer durables CVs

India Infoline Investment Services Limited Annual Report 2010-11

MAJOR HIGHLIGHTS, 2010-11

LAS/ Debentures Personal Loan Others

FUTURE ROAD MAP

India Infoline Investment Services Limited Annual Report 2010-11

Business Discussion STATUTORY REPORTS Financial Statements

DIRECTORS REPORT Directors Report

Business Discussion STATUTORY REPORTS Financial Statements

For and on behalf of the Board

STATUTORY REPORTS Financial Statements

Standalone Financial Statements

Consolidated Financial Statements

Business Discussion Statutory Reports

Standalone Financial Statements of India Infoline Investment Services Limited

India Infoline Investment Services Limited Annual Report 2010-11