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13.06.2016

To BSE Limited (R€gular oflice & Corporate Relation Dept, Scrip Code: 53g771) Phiroz€e Jeejeebhoy Towers, Dulal Street, MuEbai-400001

To Calcutta Stock Exchatrge Limited (Scrip Codet 10029247) 7, Lyons Road Kolkata-700001

Dear Sir^4adarn,

Sub: Antrual Report 201916 Ref: R€sulatiod 34(1)

Enclosed herewith the 3 8e Annual Report of the Company for the year 201 5_ 16.

Ihis for your information a.nd record please.

Thanking you ForPitrcon Spirit Limited {/ Aditya IGrwa Company Secretary

lUica IKamarbari, Kahbe a, Rrjarhat, Bisltnupur, North 24 lgns, W B., Pi n-700 1.15, CoMtry Spii| Rohanda, Villagc - Gopatpur, Cha dig;rh, P.o. - Can8an,gar. 24Pargancs (Norr[) Pin I 700 132 _00 F\4( G : fl1. \ilsrtrj Ru,d. ArJrp,rr. Xoll,ara - l0o What makes Pincon Spirit Limited one of the most exciting liquor companies in India today?

PINCON SPIRIT LIMITED PINCON SPIRIT LIMITED th Annual 15 www.pinconspirit.in 38 Report 20 16 Bringing superior IMFL attributes to the IMIL space 06 India’s liquor industry is regulated by the government at one end and dominated by multinationals at the other. How Pincon has strengthened its credentials as an Opportunity- responsive company Their formidable industry barriers mean 04 that industry players are either large or

Chairman’s Vision slow-growing. Making the review To make liquor consumption leap consumption safe, hygienic The one exception is Pincon Spirit Limited. happen 14 and responsible Pincon’s biggest contribution has been in graduating the consumer at the bottom of the consumption pyramid to a superior product One of the youngest corporatised success stories in India’s liquor space. And one of 08 the fastest-growing as well. Forward-looking statement In this annual report, we have disclosed forward looking information to enable investors to comprehend our prospects and take investment decisions. This report and other statements- written and oral- that we periodically make contain forward looking statements that set out anticipated results based on the Here’s proof: Company reported its eighth management plans and assumptions. We have tried wherever possible to identify such statements by using words such as ‘anticipate’, ‘estimate’, ‘expects’, ‘projects’, ‘intends’, ‘plans’, ‘beliefs’ and ‘words of similar substance in connection with any discussion of future performance. We cannot guarantee that these forward looking statements will be realised, although we believe we have been prudent in our assumptions. The achievements of results are subject to risk, uncertainties and even inaccurate assumptions. Should known or unknown risk or uncertainties materialise, or should underlying assumptions prove inaccurate, successive year of profitable growth in actual; results could vary materially from those anticipated, estimated or projected. Readers should bear this in mind. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. 2015-16. Revenues grew by 43%. Profit after tax strengthened by 53%. Making the Company one of the most Contents exciting prospects in India’s liquor industry.

Opportunity-responsive 04 Bringing IMFL attributes to IMIL space 06 Making the consumption leap happen 08 An insight into the corporate 10 Our corporate journey 12 Chairman’s review 14 Our robust business model 16 Company review 17 Management discussion and analysis 18 Managing business uncertainties 24 Statutory A PRODUCT [email protected] section 26 Balance Sheet and P&L Account 61 Annual 15 Report 20 16 Corporate overview | Statutory reports | Financial statements 2 3 PINCON. JUST DIFFERENT. Most established liquor companies Most IML companies have high marketing focus on the upmarket consumer. budgets. Pincon focuses at the bottom of the Pincon’s business model is weighted around low country’s consumption pyramid. marketing costs, which can be passed on to the retailers. Most liquor companies focus on upmarket niche segments. Most liquor companies begin by blending Pincon selected to focus on the popular bottling and branding followed by segment. distribution. Pincon was engaged in the distribution business Most liquor companies address existing and used this insight of liquor across blending, price segments. bottling, branding and marketing – hence the Pincon has successfully created new price entire value chain. segments. Most liquor companies prefer to specialise in a There have been virtually no new space of their choosing. players entering the IML space in the Pincon is extending its IMFL specialisation to the last couple of decades. IMIL segment. Pincon has been one of the most exciting entrants in the country’s IMFL sector. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 4 5 THE PINCON DIFFERENCE Opportunity- The Company widened it responsive. footprint across 21 districts of A few years ago, the West Bengal Government West Bengal. embarked on reforming the liquor sector. Pincon was among the first to respond to this emerging opportunity. The result is that Pincon’s first- mover’s advantage has helped it acquire a leading market share and enhance revenue visibility.

he State Government’s policy of issuing composite licenses made it possible for IMFL and IMIL T manufacturers to market their products from the same retail points. This ‘open market’ approach increased the throughput of liquor brands and products through retail outlets. Besides, the very classification of the points of liquor sale was extended to clubs, bars and hotels. Pincon was among the first liquor companies in West Bengal to recognise the implications of this reform. The Company invested aggressively, creating its first IMFL bottling capacity in 2013 widened its footprint across 21 districts of West Bengal. It launched more brands. It invested in facilities that enhanced IMIL acceptability, eliminating the odour usually associated with this product following the use of grain- based ENA. The result is that Pincon’s first-mover’s advantage has helped it acquire a leading market share and enhance revenue visibility. Making it a dominant IMIL player in West Bengal.

Bottling plants 1 in 2013-14 2 in 2014-15 3 in 2015-16 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 6 7

THE PINCON DIFFERENCE Bringing IMFL attributes to the

IMIL space. ntil a few years ago, Pincon was largely present in the IMFL segment. When the The Company U Company selected to extend to the IMIL Pincon is one of the few companies to have space, it leveraged the knowledge gathered from the proactively invested extended successfully from the premium to the IMFL segment. in deodorising popular segment. The Company’s principal learning was centred around product quality. The result was that Pincon its IMIL products, was among one of the first players to graduate enhancing their social from molasses-based IMIL to the superior grain- based equivalent, achieving the requisite 70 degree acceptability and strength. creating new markets. The Company created branded IMIL products with an upmarket look for the first time, revolutionising on-site consumer promotional methods. The Company proactively invested in deodorising its The result is that Pincon IMIL products, enhancing their social acceptability singlehandedly graduated and creating new markets. the West Bengal consumer The Company effectively utilised PET bottles from drinking illicit liquor to market its products and thus drive sales and consumption to progressive realisations. IMIL equivalents. The result is that Pincon singlehandedly graduated the West Bengal consumer from drinking illicit liquor consumption to progressive IMIL equivalents. Graduating lifestyles at the bottom-of-the-pyramid.

Additions to the IMIL portfolio 0 in 2014 1 in 2015 3 in 2016 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 8 9

THE PINCON DIFFERENCE

Making the few years ago, Pincon launched Pincon Series, a mid-priced liquor category. Rather than compete A R ather than compete with some of the established brands and take years to carve out an with some of the consumption identity, Pincon responded laterally. established brands The Company introduced radical pricing. H50 for a 180 ml bottle. H100 for a 375 ml bottle. And H260 and take years to carve leap happen. for a litre bottle. Most experts indicated that the out an identity, Pincon pricing would only attract more IMFL drinkers. responded laterally. Pincon’s biggest contribution has What Pincon achieved was entirely unexpected. The Company addressed a large chunk of IMIL been graduating the consumer at consumers as well. Attracted by the price-value the bottom-of-the-pyramid to a proposition, a number of them were encouraged superior product. to transform their tastes and lifestyles. Going beyond enhancing The Company introduced market shares; creating new radical pricing. H50 for a 180 ml markets altogether. bottle. H100 for a 375 ml bottle. And H260 for a litre bottle.

Additions to the IMFL portfolio 9 in 2013-14 11 in 2014-15 11 in 2015-16 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 10 11

Pincon Spirit Limited. ackground Management Pincon Spirit Limited entered Pincon Spirit Limited is headed India’s liquor business in 2005 as a by Mr. Monoranjan Roy. The wholesale distributor of high-volume Company’s operations are Extended from IMFL IMFL brands. Over the decade, managed by a 14-member senior Pincon has emerged as a leading management team who are player in blending, bottling and supported by 90+ employees. to IMIL. distributing proprietary IMFL and IMIL products. Besides this, Pincon refines, bottles and distributes edible Pioneered the advent oils in the FMCG segment. of branded IMIL. acilities rands The Company manages six blending Pincon enjoys a presence in all and bottling facilities (two owned IMFL segments through 11 in- and three contract manufacturing) house brands. The Company’s three Leveraging the ensuring that products reach 2,000+ brands in the IMIL space make it retail outlets in West Bengal, Karnataka, a dominant player in West Bengal. Odisha, Jharkhand and Uttarakhand, In the FMCG space, two edible growth prospects quickly and cost-effectively. Also, it oil brands enjoy wide consumer has its own oil refining and packaging acceptance in West Bengal. of two fast-growing plant in West Bengal. business segments. ey shareholder information Market capitalisation Enterprise value Face value per share BSE Code: 538771 in H crore in H crore in H CSE Code: 10029247

*All information relevant as of Liquor and edible oil. 243 504 10 31 March 2016

OTHR CORPORAT IORMATIO Headquarters: Bangalore, India Listing: CSE Ltd and BSE Ltd. Our presence Contribution towards CSR initiatives: H0.20 crore in West Bengal *As of FY 2015-16 (districts) 5 in 2013-14 12 in 2014-15 21 in 2015-16 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 12 13 OUR CORPORATE JOURNEY

2005-0 2010 2011 2012 2013 2014 2015 n Entered into a tie-ups n Present management n Launched first in-house n Expanded whisky and n Launched Highland n Set up office in Bengaluru n Launched Odisha Choice with bottling units outside takes over Sarang Viniyog brand in the IMFL segment rum portfolio Blue Whisky in the mid- for expanding into South Whisky in Odisha in the West Bengal for its IMFL Ltd, (presently Pincon – Pincon XXX Matured premium segment India economic segment brands n Launched Pincon King’s Spirit Limited) Rum Coin 50 (vodka, rum and n Launched Pincon Ruby n Launched in-house IMFL n Launched Ultra Force n Launched Pincon No. 1 n Launched wholesale n Crossed turnover of H50 whisky) Gold XO Brandy brand in Karnataka XXX Jamaican Rum in the Whisky distribution of reputed crore premium segment n Crossed turnover of H240 n Entered the FMCG n Entered the IMIL segment IMFL brands in West Bengal n Pincon XXX Matured crore segment – edible oils by launching Pincon n Launched Pincon Ruby Rum emerged as the third Bangla No.1 in West Bengal Gold Orange Flavoured Gin largest rum brand in West n Crossed turnover of H300 in regular segment Bengal* crore n Got listed on the BSE n Crossed turnover of H600 n Crossed turnover of H100 crore and net profit H10 crore crore

*As per a survey conducted by the West Bengal Foreign Liquor Manufacturers and Bonders Association

THIS IS HOW WE n Revenues increased by 43% from H693 H17 crore in 2014-15 to H26 crore. one more IMFL blending and bottling unit (Orbitol Solutions Pte Ltd), a Singapore- onward marketing in India. OUTPERFORMED crore in 2014-15 to H988 crore. n Acquired an IMIL bottling unit of in West Bengal coupled with two popular based company that will enable Pincon n Penetrated deeper and enhanced n EBITDA grew by 64% from H35 crore in National Industrial Corporation (Nicols) in IMIL brands. to export its own brand of Ultra Force XXX acceptance of edible oils in West Bengal. THE SECTOR 2014-15 to H58 crore. Asansol. n Decided to make a direct overseas Jamaican Rum to ASEAN countries. This will facilitate the import of liquor and pulses for IN 2015-16 n Profit after tax increased by 53% from n Planned to acquire two more IMIL and investment to acquire 100% of OSPL

et sales (H crore) ITA (H crore) PAT (H crore) PS (H) RO (%) 244.6 320.1 34. 62. . 10.3 14. 1.1 35.6 5.1 6. .5 10.1 16. 25.5 6. .5 10.0 16.6 1.3 32.4 2.6 25.1 2. 2.1

FY 12 FY 13 FY 14 FY 15 FY 16 FY 12 FY 13 FY 14 FY 15 FY 16 FY 12 FY 13 FY 14 FY 15 FY 16 FY 12 FY 13 FY 14 FY 15 FY 16 FY 12 FY 13 FY 14 FY 15 FY 16 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 14 15 Chairman’s overview

Our Company grew revenues by 43% superior packaged and branded IMFL efficiencies will translate greater margins “If you ask me what and profit after tax by 53% in 2015-16 – product priced affordably for the masses, visibility. We have an unusual commitment the eighth successive year of profitable we created an inducement for thousands towards logistics management and we have done that it growth. of consumers to graduate their tastes, customer responsiveness for a company preferences and lifestyles. of our size. We have been blending This outperformance was the result of a grain-based extra neutral alcohol with is indeed creditable, I conscious decision to grow the business So, if you ask me what we have done RO-treated water which has enabled us in a manner distinctive from our peers. that it is indeed creditable, I will only say to create an absolutely odourless IMIL this: we offered a branded product in a will only say this: we Principally, liquor companies in India product. Besides, ours is an instance of a space where nobody previously aspired focus on the premium branded segment, company that has widened its national to; we seeded the market with branded avoiding the low-value IMIL portfolio which footprint parallely with its regional spread. offered a branded offerings; we created an appetite for is considered to be incompatible with better products. Considering that the acquired facilities the premium portfolio and its realisations product in a space are running profitably, we expect them to not considered good enough to ensure The result is that we grew revenues at a contribute handsomely to our financials profitable growth. CAGR of 57.25% in the three years leading in 2016-17. More importantly, we have where nobody to 2015-16; we grew our profit after tax at Our Company was able to perceive invested in a medium-term plan that a CAGR of 58% during the same period. opportunities where others saw comprises expanding our operating previously aspired challenges because of our in-depth facilities, evolving our product mix, and understanding of the business. We have widening our footprint to cumulatively to; we seeded the grown from a point where we distributed Optimism 2016-1 grow our revenues to C3,000 crore by products for some of the largest liquor 2020. n Leverage acquisitions to step companies in the country for a number of market with branded The other distinctive Pincon initiative years. We saw how the business worked up production to over 1.2 crore has been our decision to extend into a from up front – what trade policies were bottles per month in the IMIL completely different business segment offerings; we created followed by the larger companies, how segment. – the refining, branding and distribution consumers responded to different prices n Acquire two bottling units in of edible oils in the FMCG segment. This and how offtake responded to changes in Malda and Cooch Behar. an appetite for better strategy has helped us de-risk ourselves positioning. n Strengthen our presence from an excessive dependence on the products.” As it turned out, we extended from throughout West Bengal and liquor segment. Following an investment distribution to blending, bottling, Karnataka. in product variety, smart marketing branding, marketing and retailing, possibly n Widen our IMFL portfolio to strategies and superior distribution the longest value chain in the country’s reap promising returns. network, we have carved out a successful liquor industry. Being small, we possessed presence in this segment marked by the right size to manage overheads. attractive revenues. This provides us Besides, the decision of the West Bengal with the optimism that this segment Pincon Spirit Limited is one of the What we have achieved in the last few Government to create a composite license can emerge as a full-fledged business years pales in comparison to what lies most attractive proxies of India’s for the liquor sector made it possible for capable of enhancing shareholder value ahead. liquor industry. us to widen our reach across the IMIL and sustainably. IMFL segments. The prospects are compelling. In India, Our Company is a proxy of the vast consumption I strongly believe that a company can there are only two pan-Indian MNCs; the potential at the base of India’s consumption This convergence – right place, right ensure sustainable growth through open rest of the players are regional. The market pyramid. Our Company is a proxy of an increased time, right size – brought us face to communication with its stakeholders. is getting increasingly corporatised. national emphasis on hygiene. Our Company is face with one of the largest sectoral There is a greater respect for companies I would like to thank our stakeholders for a proxy of the country’s branding and packaging opportunities. In West Bengal, where we that can market wider and deeper. their unflinching support and persistent revolution. Our Company is a proxy of the nation’s selected to enhance our presence, there There have been no efforts undertaken commitment in helping Pincon reach growing aspirations. Our Company is a proxy of the was a large illicit liquor trade marked by towards educating the masses about the such great heights. I look forward to country’s millions who are eager to unwind and spurious products, absence of quality consumption of safe and hygienic IMIL. the next year with the strong belief that entertain themselves. assurances and no certifications, low Pincon will continue to receive your product traceability and most importantly Our Company is attractively placed to It’s on the back of these diverse realities, our encouragement. – no contribution to the exchequer. capitalise on these realities. We achieved Company has emerged as one of the fastest- a critical mass of over 21,00,000+ cases growing companies in India today. Our Company addressed this vast Monoranan Roy of IMFL and IMIL products for the year segment (estimated in excess of H50,000 Chairman and Managing Director under review, following which scale-based crore a year across India), by offering a nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 16 17

A conversation with Mr. Arup Thakur xecutive irector and CO Our robust business model e aspire to continue growing our topline improve margins and drive bottomline growth in 2016-1.

An overview of the Company’s able to produce 2.5 crore bottles per 2,000+ of them. Our focus on extending 2015‑16 performance month compared to 1.25 crore bottles our pan-Bengal footprint should catalyse The year 2015-16 was a positive year as per month, a year ago. This capacity jump business growth. alue chain Twin revenue engines Transformation-focused our topline grew by 43% to H988 crore empowers the Company to address The Company enjoys a The Company’s revenues are The Company focuses on while net profit increased by 53% to a growing IMIL market. Besides, the The IML segment visible presence across being driven by liquor and strengthening its presence H26 crore. More importantly, our EBIDTA ownership of three leading IMIL brands is Pincon’s IMFL brands reported a 60%- the value chain – from edible oils; ensuring that it in the IMIL segment, margin strengthened by 80 bps over likely to make Pincon the go-to company plus revenue growth over the previous production to retail. isn’t overtly depedent on any graduating from entry-level the previous year. This profitable growth in terms of its distribution channel and will year even as its core brands are relatively one of the two verticals. IMFL products to mainstream validates the Company’s ability to build make it possible for us to optimise costs. new and only started gaining consumer products by branding and volumes, generate attractive realisations The bottomline is that the acquisitions acceptance in the states of their presence. leveraging its corporatised and optimise costs. will make us a larger company capable of selling faster and at a lower cost – Outlook identity. This outperformance was the result of the adding value for stakeholders across the The Company is hopeful of sustaining successful implementation of a number of foreseeable future. its growth in the current year on a initiatives. We strengthened our presence larger base. We will continue enhancing in Karnataka (having entered the market The est engal opportunity marketplace and shopfloor efficiencies in late 2014-15), resulting in incremental From a macro perspective, West Bengal and strengthening our product basket to volumes. We focused on growing consumes about 6 crore IMIL bottles per fill market gaps. Our proposed acquisition awareness regarding our core brands. Bottling integration Resource integrity month on an average, apart from the of Orbitol Solutions Pte Ltd, a Singapore- We launched new products and product based company, will facilitate the export The Company has invested The Company has selected sizeable volumes of illicit liquor. The West extensions that generated encouraging of our Ultra Force XXX Jamaican Rum to extensively in back-end to manufacture IMIL from Bengal Government’s desire to wipe out volumes. the ASEAN countries. integration – via the direct grain-based ENA, enhancing illicit liquor consumption in West Bengal has brightened prospects for us in the ownership of bottling plants taste on the one hand and ey corporate achievements We aspire to continue growing our IMIL segment. and tie-ups, strengthening eliminating odour on the 2015‑16 topline, improve margins and drive its value chain. other, resulting in increased bottomline growth in 2016-17. We The Company completed two IMIL-related usiness-strengthening initiatives acceptability among the acquisitions in 2015-16. Pincon acquired intend to mobilise funds for acquisitions Consider this: our flagship Bangla No.1 masses. a bottling unit in Asansol to address the and financing day-to-day opeartions brand along with the newly-acquired large liquor consuming market in the through a prudent mix of debt and equity, brands are present across 21 districts coal mining belt of West Bengal. The strengthening our Balance Sheet. of West Bengal. The extension of these Company embarked on the acquisition prominent brands across our existing In view of these realities, we expect of two blending and bottling units in Distribution Acquisitions Diversification footprint could alone make a sizeable to drive sustainable growth over the Dankuni and Barahanagar. The Company The Company markets The Company has The Company invested across addition to our volumes. foreseeable future. also acquired two popular IMIL brands - products through private/ demonstrated the ability the IMFL range (whisky, gin, Bengal Tiger (more than 20 years old) and governmental distribution to identify targets and vodka and rum) with the rowth opportunities Uddan (more than 15 years old) – that channels. The Company acquire bottling plants and objective to capture the Even as we are a dominant IMIL player in are expected to translate into enhanced possesses a strong retail brands to address the vast upside in each and moderate West Bengal with a 40% market share, our offtake in 2016-17. and institutional network consumption potential in the an excessive dependence on presence in North Bengal is still marginal. (proprietary retail shops in markets of its presence. any one variety. Consequently, we are analysing inorganic The IMIL business segment West Bengal). growth opportunities in that location. The Company has enhanced % From a distribution perspective, there are 55 manufacturing capacities following these increase in our points-of-sale in FY16 about 2,200 active shops marketing IMIL acquisitions. The Company will now be brands while our products are available in Annual 15 Report 20 16 Corporate overview | Statutory reports | Financial statements 18 19

Management discussion and analysis Business segment#1

Proprietary Indian economy result of the exceptional performance controlling demand pressures, keep brands of the country’s manufacturing sector external shocks at bay and control rupee The global landscape has been rough and (9.5% growth in 2015-16 against 5.5% in volatility and inflation. uncertain with weak output growth. 2014-15), which was due to a significant India’s economy is expected to sustain 11 Even in these trying times, India’s fall in inputs costs following a decline in its growth momentum in the current economic growth was positive wherein global commodity prices. Besides, growth year. The Economic Survey 2015-16 has inflation, fiscal deficit and current account is also being significantly driven by private projected a GDP growth of 7-7.75% in balance showed improvement. consumption aided by lower energy Traded brands 2016-17, while IMF has estimated India’s prices and higher real incomes. India registered robust growth of 7.2% in GDP growth at 7.5% in FY17 supported by 2014-15 and an 7.6% in 2015-16, retaining Economic robustness was also facilitated stronger domestic demand. IMFL its position as the fastest-growing major by positive RBI policies which aided in (Source: IMF, ET, World Bank) 50+ economy. This growth was largely the

incon entered the IMFL segment of 14% on the strong growth of our IMFL Proportion of through wholesale distribution and brands. Going forward, business growth is income from IMFL business (2015-16) (%) INDUSTRY REVIEW P subsequently graduated to blending, expected to sustain momentum, even as bottling and marketing proprietary brands its share in the overall business is likely to The Indian liquor industry is estimatedly consider India as an under-consumed joint ventures have increased, leading to across five states. Pincon is possibly the decline. worth C1,400 billion. This segment is still market, which has seen steady growth market consolidation. This industry can only liquor player in India with a footprint be broadly divided into the following 45 largely untapped, making it attractive for in the last five years. In view of this rich extending from production to wholesale and liquor players. Several global companies potential, the pace of acquisitions and segments: Proprietary products retail. The Company produces proprietary liquor Sales volumes in brands with a manufacturing capacity of 2015-16 (lac cases) Type of industry Pricing Target audience holesale distribution 120,000 cases per month. The Company’s IMFL (Indian Made Foreign Liquor) Affordable and competitive Above 24 years The Company is engaged in the wholesale product portfolio comprises 11 brands across distrbution of leading liquor brands for five categories (rum, whisky, vodka, brandy and IMIL (Indian Made Indian Liquor) Low-end prices are a driving factor Above 35 years which it enjoys tie-ups with more than 3,000 gin). 11+ licensees in West Bengal. Over the years, the business provided the Company with a Highlights 2015-16 grassroots understanding of the segment Revenue in 2015- n Revenues grew by more than 60%; the 16 (H crore) and regional customer preferences. The average industry growth was more than 8% IML Indian Made oreign consumed in India, accounting for around 150 million will be added to this Company entered this segment in 2009. In Liquor nearly 50% of the market and growing at group over the next five years. 2015-16, this business generated revenues n Strengthened ‘route to market’ capabilities around 6-8% each year. There has been a IMFL is a large segment of the Indian Social norms: There has been a visible worth H341 crore against H322 crore in – right product at the right place. gradual shift from illicit liquor to licensed 588 liquor industry segmented into various change in drinking attitudes, enhancing 2014‑15. Even as its contribution to the and subsidised IMIL (country liquor). n Launched Ruby Gold Gin, which was well types (whisky, vodka, gin, rum and the social acceptability of alcohol topline (consolidated) declined from 49% to received by the customers brandy). This segment is dominated by Industry challenges comprise restrictive consumption. 33%, IMFL as a segment registered a growth whisky (60% of volumes), followed by state policies regarding pricing, Rising disposable incomes: Most rum (25%). This segment sells around 80 production and movement, increase Indians are in the productive working age Product rands Pincon’s position in est billion cases a year. In the IMFL segment, in raw material costs and advertising bracket and moving towards the upper segment engal vodka is the fastest-growing at around restrictions. and middle income groups. 9-10%, consumption of which has 50 degrees or Pincon King’s Coin (whisky, rum, vodka) Second-largest by volume increased due to increased popularity Industry drivers Increased alcohol accessibility and more among women. Besides, evolving availability: The industry is populated Budget Pincon No. 1 Select Whisky, Odisha Choice Leader in this product Urbanisation: As more people migrate consumer preferences towards premium by a number of brands (high-end and Whisky, Pincon XXX Matured Rum, Pincon segment to cities, they will be exposed to a wider IMFL varieties are likely to enhance low-end). Most low-end brands are Perfect Grain Vodka and Pincon Ruby Gold Pincon is one of the few variety of liquor products. realisations and prospects. available in government-licensed outlets, XO Brandy users of grain-based Favourable demographics: More than government shops (monopolies), private Regular Highland Blue Whisky, Ultra Force XXX Steadily growing market A which enhances 60% of India’s population lies in the age IMIL Indian Made Indian licensed retail chains, restaurants and Jamaican Rum, Pincon Ruby Gold Orange shares product taste. group of 15-45. More than 480 million bars. Liquor Gin Indians are above the drinking age; This is the largest form of alcohol nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 20 21

Business segment#2 n Made inroads in the difficult- Agenda for 2016-17 to-penetrate rum segment Proprietary n Increase presence of core brands (customer preferences are fixed brands (Highland Blue Whisky, around traditional brands) with Indian IMFL Pincon No.1 Select Whisky and Pincon IMFL its Ultra Force XXX Jamaican Rum segment revenue revenue growth, Ultra Force XXX Jamaican Rum) growth, 2015-16 (%) 2015-16 (%) 3 n Revamped packaging of its in Karnataka flagship Highland Blue whisky n Widen and deepen the Districts of brand to strengthen customer distribution network presence appeal 8+ 14 n Bolster the Pincon portfolio n Strengthened branding and awareness IMIL 21

Points-of-sale aving entered this space in 2015 Highlights, 2015-16 following the launch of the Pincon IMFL portfolio n The Company began blending and Bangla No.1 brand, the Company has 4,800 H320 for 750 ml H415 for a litre H bottling liquor under the IMIL segment emerged as a dominant IMIL player (post- during the year under review. acquisition) in West Bengal. n Acquired Nicols, which added a Pincon is among the pioneers in manufacturing unit to the Company’s asset Revenue in 2015- corporatising the IMIL segment (country 16 (H crore) bank (capacity of 20 lac bottles per month), liquor), which is still largely unorganised. enabling the Company to establish its The use of grain-based ENA as the basic footprint in the coal mining belt of West ingredient mixed with demineralised water Bengal, a large IMIL market. 123 from the Company’s plant and the use of n Embarked to acquire two manufacturing state-of-the-art automatic bottling lines IMFL – A wide product units – Dankuni and Barahanagar - which have positioned Pincon distinctively from basket across strategic also added two of the highest-selling IMIL its peers (through product quality and price points widens the brands, Bengal Tiger (more than 20 years old) taste). The Company’s sustained advertising opportunity canvas and Uddan (more than 15 years old). and promotional initiatives are aimed at Pincon IMIL revenue growth, 2015-16 (%) Gin Ruby Gold Whisky Highland Blue raising awareness on the need to graduate n Introduced an orange-flavoured variant of consumers from illicit liquor to branded IMIL Bangla No. 1 in December 2015, which was well-received. H340 for a litre H160 for 750 ml H160 for 750 ml variants. These factors have enhanced the acceptability of the Company’s products 100 leading to increased offtake. Agenda for 2016-17

Pincon strengthened its sectoral n Introduce four flavoured variants under the Indian IMIL segment revenue leadership by increasing capacities (three Bangla No. 1 brand growth, 2015-16 (%) manufacturing units) and acquiring brands n Extend product availability of newly-acquired (Uddan and Bengal Tiger). brands across Bengal. Currently, the Company has a capacity to n Scout for acquisition opportunities to 15 produce 1.3 crore bottles a month across strengthen presence in North Bengal. three manufacturing facilities in Central and South Bengal. Pincon’s Bangla No. 1 is n Assist the State Government to counter Pincon aims to achieve a available in 21 districts across 2,000+ retail the sale of unlicensed country liquor (hooch) 60% market share in the outlets. by introducing an alcohol variant of similar IMIL space in West Bengal strength (80 degrees). by the end of FY17. Rum Jamaican Ultra Force Vodka King’s Coin Rum King’s Coin nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 22 23

Business segment#3 brands How does Pincon enhance 2 consumer value?

Production At Pincon, we believe in providing capacity in tonnes value to our consumers through differentiation. This philosophy has ensured the Company’s success in 50,000 the IMIL segment, with growing customer adoption of our brands, increasing IMIL sales volumes to 1 Proportion of Edible oils income from own crore bottles a month. Our superior business (2015-16) (%) price-value proposition is expected to establish us as one of the largest 28 IMIL (country spirit) players in India. his business segment is engaged segment grow revenues by 60% during the Sales volumes in in the manufacture of edible oils. year under review. 2015-16 in tonnes The Company owns a refining and T n Pincon leveraged its expertise in the packaging unit. distribution of liquor products in the realm of 31,000+ The Company entered the edible oil segment edible oils. in 2013 and markets its products in West n The Company focused on consolidating its Bengal and North East India. This segment edible oils business in West Bengal. has helped in diversifying the Company’s Revenue in business and creating an additional revenue 2015‑16 (H crore) stream. Agenda for 2016-1 n The segment holds substantial promise Highlights 2015-16 and hence the Company plans to further consolidate its presence in West Bengal. 281 n The topline growth that was achieved in the year under review was H101 crore, which n The product recall of its liquor business is substantial, considering the Company would be instrumental in boosting sales of its entered the edible oils segment in 2013. edible oils. n Its competitive pricing has helped this

The Indian edible oils market is the The Indian edible oil market is fourth largest in the world after the US, under-penetrated and holds immense China and Brazil, accounting for around Sectoral potential for growth. 9% of the world’s oilseeds production. attributes

Edible oil consumption will receive a Demand-supply issues have still not Rising incomes will enhance the boost with the population increasing been fully addressed due to a lack of an growth of this sector. incrementally over the years. efficient logistics chain. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 24 25

Managing business uncertainties PROCT RIS: Non-acceptance of the product in the consuming fraternity could Business is about taking and managing risks. A business’s risk profile will evolve with altering impact business sustainability. dynamics. The same holds true at Pincon, which has progressively emerged as one of the India’s fastest-growing corporates. The Company leveraged its domain knowledge to strengthen viability across products, geographies and market cycles. Mitigation: The Company has been in business for more than a decade. Its IMFL wholesale operations provide insights into evolving customer preferences across geographies. Based on this knowledge, the Company has launched a slew of successful products. The most recent launch was Ruby Gold Gin which sold more than 30,000 cases during the previous fiscal. RLATOR RIS: The Company’s Result: Each of the Company’s brands registered healthy double-digit growths in the last three years. business depends largely on governmental policies, especially excise laws.

Mitigation: As a part of its de-risking initiatives, the Company has strategically established a I RIS: Inability to mobilise footprint in areas where State Governments are not averse to liquor consumption. The Company adequate low-cost funds could affect has a team of professionals who ensure that its operations conform to the laws of the land. growth aspirations. Result: Pincon has emerged as one of the fastest-growing companies in India. Its topline has grown Mitigation: The Company’s businesses (liquor and edible oils) are working capital-intensive. The at a CAGR of 50% + over the last five years. Company expects to infuse around H225 crore in 2016-17 (a mix of debt and equity) thereby strengthening organisational liquidity and de-leveraging its Balance Sheet. Moreover, growth in business volumes is expected to strengthen cash flows which could be deployed to fund working capital needs and repay debts. Result: The capital employed in the business increased from H99 crore in 2014-15 to H136 crore in 2015-16; strategic investor (Chairman and Managing Director) infused H62 crore into the business ORAPHIC RIS: An overt dependence on a in 2015-16, enhancing liquidity. single state could impact growth if geopolitical challenges emerge in that geography. MARIS RIS: Inability to manage growing business operations could impact Mitigation: Pincon generates more than 65% of its revenues from West Bengal. Hence it could be affected by unforeseen adversities impacting the state. However, the geopolitical scenario profitability. in West Bengal does not threaten liquor consumption. As a de-risking measure, the Company is Mitigation: The growing scale of operations and the consequent economies-of-scale will bolster strengthening its presence in Karnataka, Jharkhand and Odisha. The Company is also extending operating margins. Streamlining of business operations is a continuous journey and as the its footprint to Delhi and Chattishgarh. Its proposed acquisitions allows it to export IMFL products Company grows larger, its negotiating power with key stakeholders is expected to strengthen, thus to ASEAN nations. The widening of the opportunity canvas is expected to reduce the Company’s optimising costs. From a realisations perspective, the Company is moving up the value chain in the dependence on West Bengal. IMFL business (focus on core brands) and this is expected to improve margins Result: Revenue contribution from outside West Bengal states grew from scratch in 2012-13 to 35% Result: Revenues from core brands increased from H170 crore in 2014-15 to H384 crore in 2015-16 in 2015-16. while EBIDTA margin improved by 80 bps over the same period. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 26 27

Directors’ Report

AUDITORS’ CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND In the 36th AGM held on 29.09.2014, D.N. Misra & Co., Chartered FOREIGN EXCHANGE EARNINGS AND OUTGO Accountants has been appointed as Statutory Auditors of the The particulars prescribed under section 134(3) (m) of the Act, read Company for a period of 5 years. Ratification of appointment of with Rule 8 of the Companies (Accounts) Rules, 2014, are set out in Your Directors are pleased to present the 38th Annual Report and the Company’s Audited Accounts for the Financial Year ended Statutory Auditor’s is being sought from the members of the Annexure – 4. March 31, 2016. Company at the ensuing AGM. RELATED PARTY TRANSACTION FINANCIAL RESULTS Further, the report of the Statutory Auditor along with Schedules All related party transactions that were entered into during the The Company’s financial performance for the year under review along with previous year figures is given hereunder: and Notes to Accounts are enclosed to this report. The observations Financial Year were on an arm’s length basis and were in the ordinary H in Lacs made in the Auditors’ Report are self-explanatory and therefore do course of business. There are no materially significant related party PARTICULARS 2015-16 2014-15 not call for any further comments. transactions made by the Company with Promoters, Directors, Key Revenue 94,605.88 60,269.67 Managerial Personnel or other designated persons which may have AUDITORS’ REPORT Profit before Interest, Depreciation, Tax 5610.41 3,285.89 a potential conflict with the interest of the Company at large. The The observations of the auditors in their report are self-explanatory Depreciation 207.40 215.14 details of related party transactions required under section 134(3) and therefore, in the opinion of the Directors, do not call for further Interest 1,669.28 706.73 (h) read with Rule 8 of the Companies (Accounts) Rules, 2014, is comments. Profit after Interest & Depreciation 3,733.73 2,364.01 given in Form AOC 2 and the same is enclosed as Annexure – 5, the Provision for Taxation (I. Tax & Deferred Tax) 1,247.77 796.01 SUBSIDIARIES same is mentioned in the notes of accounts as well. In accordance with Section 129(3) of the Companies Act, 2013, a Profit after Tax 2,485.96 1,568.00 The Company’s policy on dealing with Related Party Transactions statement containing salient features of the Financial Statements of Share Capital 2,104.30 1,002.15 was adopted by the Board on 17th October, 2014 and is available the subsidiary companies in Form AOC 1 is provided as Annexure Reserve & Surplus 6,948.14 4,463.84 on the website. – 1 to this report. In accordance with third provision to Section EPS - Basic (Rupees) 11.81 15.65 136(1) of the Companies Act, 2013, the Annual Report and Financial EXTRACT OF ANNUAL RETURN EPS - Diluted (Rupees) 16.87 15.65 Statements of each of the Subsidiary Companies have also been The details forming part of the extract of the Annual Return in Form placed on the website of the Company www.pinconspirit.in No. MGT-9 is annexed herewith as Annexure – 6. RESULTS OF OPERATIONS DIVIDEND Operating in a volatile and uncertain environment, the Company Directors have recommended a dividend of H0.75 (i.e. 7.50%) per SECRETARIAL AUDITORS CORPORATE GOVERNANCE demonstrated the resilience of its business model. equity share for the Financial Year ended March 31, 2016. The Section 204 of the Companies Act, 2013 inter-alia requires every The report on Corporate Governance as stipulated under the SEBI dividend payout is subject to approval of members at the ensuing listed company to annex with its Board’s Report, a Secretarial Audit (Listing Obligations and Disclosure Requirements) Regulations, PERFORMANCE OF THE COMPANY Annual General Meeting. The dividend will be paid to members Report given by a Company Secretaries in practice, in the prescribed 2015, forms an integral part of this Report. The requisite certificate During the year under review, your Company has achieved sales whose names appear in the Register of Members as on May 30, form. from the Auditors of the Company confirming compliance with the of H94,605.88 Lacs representing a steadfast growth of 56.97% over 2016 and in respect of shares held in dematerialised form, it will be conditions of Corporate Governance is attached to the report on the previous year of H60,269.97 Lacs. Net Profit from operations The Board of Directors appointed M/s. Arpan Sengupta & Associates, paid to members whose names are furnished by National Securities Corporate Governance. at H2,485.96 Lacs registered a robust growth of 58.54% over the Depository Limited and Central Depository Services (India) Limited, Practicing Company Secretary, as Secretarial Auditor to conduct previous year of H1,568.00 Lacs. as beneficial owners as on that date. Secretarial Audit of the Company for Financial Year 2015-16 and BOARD MEETINGS their report is annexed to this Board Report as Annexure – 2. A calendar of Meetings is prepared and circulated in advance to OUTLOOK DIRECTORS The Secretarial Audit Report does not contain any qualification, the Directors. The Board met 19 times during the year, the details of The details about prospects/ outlook of your Company are provided As per the provisions of the Companies Act, 2013, Mr. Subrata reservation, adverse remark or disclaimer. which are given in the Corporate Governance Report that forms part under the Management Discussion and Analysis Report, forming Basu retires by rotation at the ensuing AGM and being eligible of this Annual Report. The intervening gap between the Meetings part of this Annual Report. PARTICULARS OF EMPLOYEES offers himself for re-appointment. The Board recommends the re- was within the period prescribed under the Companies Act, 2013 The information required pursuant to Section 197 read with rule 5 CONSOLIDATED FINANCIAL STATEMENT appointment of Mr. Subrata Basu as Director & Mr. Abhijit Datta, who and the SEBI (Listing Obligations and Disclosure Requirements) of the Companies (Appointment and Remuneration of Managerial In accordance with the Accounting Standard (AS) 21 on Consolidated was appointed as Additional Director (Independent) on 09.02.2016 Regulations, 2015, Personnel) Rules, 2014 in respect of employees of the Company, is Financial Statements, the Audited Consolidated Financial Statement to be appointed/regularised as Director (Independent) in the provided as Annexure – 3. is provided in the Annual Report. ensuing AGM of the Company. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 28 29

BOARD COMMITTEES security policy and personal accident coverage for lives of all INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY: Committees. The evaluation process considered the effectiveness The Company has set up the following committees of the Board. employees. The Company has a well-placed, proper, adequate and documented of the Board and the Committees with special emphasis on the A. Audit Committee internal control system commensurate with the size and nature of performance and functioning of the Board and the Committees. A detailed note on the risks is included in the Corporate Governance B. Nomination and Remuneration Committee its business. The primary objective of the internal control system The evaluation of the Directors were based on the time spent by Report. C. Stakeholders’ Relationship Committee is to ensure that all its assets are safeguarded and protected and each of the Board Members. D. Corporate Social Responsibility Committee MANAGEMENT DISCUSSION AND ANALYSIS to prevent any revenue leakage and losses to the Company. Such DIRECTORS’ RESPONSIBILITY STATEMENT E. Risk Management Committee The Report on Management Discussion and Analysis as stipulated controls also enable reliable financial reporting. The report on In terms of Section 134(3) (C ) & (5) of the Companies Act, 2013, the F. General Committee of Directors under the SEBI (Listing Obligations and Disclosure Requirements) Internal Control Systems and their adequacy is forming part of Directors would like to state that: The composition of each of the above committees, and their Regulations, 2015, forms an integral part of this Report. The requisite Management & Discussion Analysis Report. respective roles and responsibilities are detailed in the Corporate certificate from the Auditors of the Company confirming compliance I. In the preparation of the Annual Accounts, the applicable HUMAN RESOURCES: Governance Report. with the conditions of Corporate Governance are attached to the accounting standards have been followed. Your Company treats its “Human Resources” as one of its most Report on Corporate Governance. II. The Directors have selected such accounting policies and NOMINATION, REMUNERATION AND EVALUATION POLICY important assets. Your Company continuously invests in attraction, applied them consistently and made judgments and estimates In accordance with the provisions of Section 178 of the Companies DEPOSITORY SYSTEM retention and development of talent on an ongoing basis. A that were reasonable and prudent so as to give a true and fair Act, 2013 read with Regulation 19 of the SEBI (Listing Obligations The trading in the Equity Shares of your Company are under number of programs that provide focussed people attention are view of the state of affairs of the Company at the end of the and Disclosure Requirements) Regulations, 2015, the Board of compulsory dematerialisation mode. As on 31.03.2016 Equity currently underway. Your Company’s thrust is on the promotion of Financial Year and of the Profit or Loss of the Company for the Directors in its Meeting held on 17th October, 2015 has, on the Shares representing 71.00% of the Equity Share Capital are in talent internally through job rotation and job enlargement. year under review. recommendation of Nomination and Remuneration Committee, dematerialised form. As the depositary system offers numerous INDUSTRIAL RELATIONS: adopted the Nomination, Remuneration and Evaluation Policy of advantages, Members are requested to take advantages of the same III. The Directors have taken proper and sufficient care for the During the year under review, your Company enjoyed cordial the Company which is laid down in the Corporate Governance and avail of facility of dematerialisation of the Company’s Shares. maintenance of adequate accounting records in accordance relationship with its workers and employees at all levels. Report. with the provisions of this Act for safeguarding the assets of the FIXED DEPOSITS Company and for preventing and detecting fraud and other DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT CORPORATE SOCIAL RESPONSIBILITY (CSR) Your Company has not accepted any deposits within the meaning irregularities. WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, Corporate Social Responsibility is commitment of Company to of Section 73 of the Companies Act, 2013 and the Companies 2013: As per Section 134(CA) of the Companies Amendment Act, improve the quality of life of the work force and their families and (Acceptance of Deposits) Rules, 2014. The Company is committed to provide a healthy environment to 2015 duly notified on 26th May 2015, no fraud was reported by also the community and society at large. The Company believes all its employees and has zero tolerance for sexual harassment at Auditor’s under Sub-Section (12) of Section 143. in undertaking business in such a way that it leads to overall CREDIT RATING workplace. The Company has in place an Anti-Sexual Harassment IV. The Directors have prepared the Annual Accounts on a going development of all stakeholders and Society. Report on Corporate SMERA, a reputed agency has assigned Credit Rating “SMERA BBB Policy in line with the requirements of the Sexual Harassment concern basis. Social Responsibility is annexed herewith as Annexure – 7. (Stable)” for short-term instrument of the Company. of Women at Workplace (Prevention, Prohibition and Redressal V. The Directors have laid down internal financial controls to Information on the composition of the Corporate Social Responsibility During the year Dun & Bradstreet has assigned a Rating of “D&B-4A2” Act), 2013. Internal Complaints Committee (ICC) has been set up be followed by the Company and that such internal financial (CSR) Committee is provided in the Corporate Governance Report PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS: to redress complaints received regarding sexual harassment. All controls are adequate and were operating effectively. that forms part of this Annual Report. Furthermore, as required by employees (permanent, temporary, trainees) are covered under this The Company has not given any loans, guarantees or investments VI. The Directors had devised proper system to ensure compliance Section 135 of the Act, and the Rules made thereunder, additional policy. covered under the provisions of Section 186 of the Companies with the provisions of all applicable laws and that such system information on the policy and implementation of CSR activities Act, 2013. There was no case reported during the year under review under the were adequate and operating effectively. by your Company during the year are provided in Corporate said policy. Governance Report to this Report. WHISTLE BLOWER /VIGIL MECHANISM ACKNOWLEDGEMENTS In accordance with the provisions of Section 177(9) of the TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND Your Directors would like to acknowledge and place on record RISK MANAGEMENT POLICY Companies Act, 2013 read with Rule 7 of the Companies (Meetings PROTECTION FUND their sincere appreciation of all stakeholders - shareholders, bankers The Company has a Risk Management Policy which has been of Board and its Powers) Rules, 2014 and the SEBI (Listing Obligations Your Company did not have any funds lying unpaid or unclaimed dealers, vendors and other business partners for the excellent adopted by the Board of Directors. Currently, the Company’s risk and Disclosure Requirements) Regulations, 2015, the Company has for a period of seven years. Therefore there were no funds which support received from them during the year under review. Your management approach comprises of the following: adopted a Whistle Blower Policy to provide a mechanism to its were required to be transferred to Investor Education and Protection Directors recognise and appreciate the efforts and hard work of all Regulatory Risk directors, employees and other stakeholders to raise concerns about Fund (IEPF). the employees of the Company and their continued contribution Strategic Risk any violation of legal or regulatory requirements, misrepresentation to its progress. Concentration Risk of any financial statement and to report actual or suspected fraud or BOARD EVALUATION CRITERIA For and on behalf of the Board of Directors violation of the Code of Conduct of the Company. The Policy allows Pursuant to the section 134 (P) of Companies Act, 2013 read with The risks have been prioritised through a company wide exercise. the whistle-blowers to have direct access to the Chairman of the Rule 8 (4) of Companies Accounts Rule, 2014 and the SEBI (Listing Sd/- Members of Senior Management have undertaken the ownership Audit Committee in exceptional circumstances and also protects Obligations and Disclosure Requirements) Regulations, 2015, the Monoranjan Roy and are continuously working on mitigating the same through co- them from any kind of discrimination or harassment. Board has carried out an annual performance evaluation of its Place: Kolkata, Chairman & Managing Director ordination among the various departments, insurance coverage, own performance, the Directors individually, as well as the Board Date: 28.04.2016 (DIN: 02275811) nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 30 31

Annexure – 1 Annexure – 2 FORM AOC-1 SECRETARIAL AUDIT REPORT FOR THE [PURSUANT TO FIRST PROVISO TO SUB-SECTION (3) OF SECTION 129 READ WITH RULE 5 OF FINANCIAL YEAR ENDED MARCH 31, 2016 COMPANIES (ACCOUNTS) RULES, 2014] [PURSUANT TO SECTION 204(1) OF THE COMPANIES ACT, 2013 AND RULE 9 OF THE COMPANIES STATEMENT CONTAINING SALIENT FEATURES OF THE FINANCIAL STATEMENT OF SUBSIDIARIES/ (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014, READ WITH ASSOCIATE COMPANIES/JOINT VENTURES THE GUIDANCE NOTE ON SECRETARIAL AUDIT (RELEASE – 1.2) OF THE INSTITUTE OF COMPANY SECRETARIES OF INDIA]

Part “A”: Subsidiaries To, The Members, (Information in respect of each subsidiary to be presented with amounts in Lacs) Pincon Spirit Limited Sl. No 1 2 3 7, Red Cross Place Name of the Subsidiary Paul Distributors Priya Laboratories Yours Laboratories “Wellesley House” 3rd Floor, Kolkata – 700 001 Private Limited Private Limited Private Limited Financial Year Ended 31.03.2016 31.03.2016 31.03.2016 We have conducted the Secretarial Audit of the compliance has proper Board-processes and compliance-mechanism in place Currency INR INR INR of applicable statutory provisions and the adherence to the extent, in the manner and subject to the reporting made Share Capital 100.00 243.78 16.00 to good corporate practices by Pincon Spirit Limited hereinafter: (CIN L67120WB1978PLC031561) (hereinafter called “the Company”). Reserves & Surplus 1,208.04 (137.83) 40.26 We have examined the books, papers, minute books, forms and Secretarial Audit was conducted in a manner that provided us a Total Assets 1,913.40 233.74 141.05 returns filed and other records maintained by the Company for the reasonable basis for evaluating the corporate conducts/statutory Total Liabilities 605.35 127.79 84.78 period from 1st April, 2015 to 31st March, 2016 according to the compliances and expressing our opinion thereon. provisions of: Investments - - - Turnover 3543.13 323.60 322.71 Management’s Responsibility for Secretarial (i) The Companies Act, 2013 (the Act) and the Rules made Profit Before Taxation 77.31 64.50 38.08 Compliances thereunder; The Company’s Management is responsible for preparation and Provision For Taxation 23.89 50.39 11.77 (ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the maintenance of secretarial records and for devising systems to Profit After Taxation 53.42 14.10 26.31 Rules made thereunder; ensure compliances with the provisions of applicable Laws and Proposed Dividend - - - Regulations. (iii) The Depositories Act, 1996 and the Regulations and Bye-laws % of Shareholding 55.00% 62.50% 100.00% framed thereunder; Auditor’s Responsibility (iv) Foreign Exchange Management Act, 1999 and the Rules and Our responsibility is to express an opinion on the secretarial records, Regulations made thereunder to the extent of Foreign Direct Part “B”: Associates and Joint Ventures standard and procedures followed by the Company with respect to Investment (Not applicable to the Company during the Audit Statement pursuant to Section 129 (3) of the Companies Act, 2013 related to Associate Companies and Joint Ventures secretarial compliances. Period), Overseas Direct Investment and External Commercial This part is not applicable to the company as there is no associate or Joint Venture Company We believe that, Audit evidence and information obtained from the Borrowings (Not applicable to the Company during the Audit Company’s Management is adequate and appropriate to provide a Period); basis for our opinion. (v) The following Regulations and Guidelines prescribed under the Based on our verification of the Company’s books, papers, minute Securities and Exchange Board of India Act, 1992 (‘SEBI Act’):- books, forms and returns filed and other records maintained by a) The Securities and Exchange Board of India (Substantial For and on behalf of the Board of Directors Pincon Spirit Limited and also the information provided by the Acquisition of Shares and Takeovers) Regulations, 2011; Company, its officers, agents and authorized representatives during the conduct of Secretarial Audit, we hereby report that in our b) The Securities and Exchange Board of India (Prohibition of Sd/- opinion, the Company has, during the Audit Period from 1st April, Insider Trading) Regulations, 1992; Monoranjan Roy 2015 to 31st March, 2016 (“the Reporting Period”) complied with the Place: Kolkata, Chairman & Managing Director c) The Securities and Exchange Board of India (Issue of Capital and statutory provisions listed hereunder and also that, the Company Date: 28.04.2016 (DIN: 02275811) Disclosure Requirements) Regulations, 2009; nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 32 33 d) The Securities and Exchange Board of India (Employee Stock Adequate notice is given to all directors to schedule the Option Scheme and Employee Stock Purchase Scheme) Board Meetings, agenda and detailed notes on agenda were sent Annexure – A Guidelines, 1999 and The Securities and Exchange Board adequately in advance, and a system exists for seeking and obtaining of India (Share Based Employee Benefits) Regulations, 2014 further information and clarifications on the agenda items before notified on October 28, 2014; the meeting and for meaningful participation at the meeting. Annexure to the Secretarial Audit Report of M/s. Pincon Spirit Limited e) The Securities and Exchange Board of India (Issue and Listing Majority decision is carried through while the dissenting members’ of Debt Securities) Regulations, 2008 (Not applicable to the views are captured and recorded as part of the minutes. for the Financial Year ended 31st March, 2016 Company during the Audit Period); We further report that there are adequate systems and f) The Securities and Exchange Board of India (Registrars to an processes in the Company commensurate with the size and Issue and Share Transfer Agents) Regulations, 1993 regarding To, operations of the Company to monitor and ensure compliance the Companies Act and dealing with client; The Members, with applicable laws, Rules, Regulations and Guidelines. Pincon Spirit Limited g) The Securities and Exchange Board of India (Delisting of Equity We further report that during the Audit Period: 7, Red Cross Place Shares) Regulations, 2009 (Not applicable to the Company The Company has passed following special resolutions which are “Wellesley House” 3rd Floor, during the Audit Period); having major bearing on the Company’s affairs in pursuance of Kolkata – 700 001 h) The Securities and Exchange Board of India (Buyback of the above referred Laws, Rules, Regulations, Guidelines, Standards, Securities) Regulations, 1998 (Not applicable to the Company etc.: Our Secretarial Audit Report for the Financial Year ended 31st March, the board and by various committees of the Company during during the Audit Period); and i. Issue of Secured, Rated, Listed, Non-Convertible, Cumulative, 2016 of even date is to be read along with this letter. the period under review. We have checked the board process Redeemable, Taxable Debentures; and compliance management system to understand and to i) The SEBI (Listing Obligations and Disclosure Requirements) 1. Maintenance of secretarial record is the responsibility of the form an opinion as to whether there is an adequate system Regulations, 2015, ii. Increase in borrowing limits under Section 180(1) (c) of the management of the Company. Our responsibility is to express of seeking approval of respective committees of the board, of Companies Act, 2013; an opinion on existence of adequate board process and We, based on the representation made by the Company and its the members of the Company and of other authorities as per iii. Sell, lease or dispose off whole or substantially the whole of compliance management system, commensurate to the size officers for systems and mechanism framed by the Company for the provisions of various statutes as referred in the aforesaid the undertaking under Section 180(1) (a) of the Companies Act, of the company, based on these secretarial records as shown compliances under other applicable Acts, Laws and Regulations to Secretarial Audit Report. 2013; to us during the said audit and also based on the information the Company, further report that, the Company has complied iv. Increase of Authorised Capital of the Company; furnished to us by the officers and agents of the Company 4. Where ever required, we have obtained the management with the following laws applicable specifically to the Company: v. Change Clause V of the Memorandum of Association of the during the said audit. representation about the compliance of laws, rules and We are of the opinion that the management has complied with the Company; regulations and happening of events etc. 2. We have followed the audit practices and processes as were following laws specifically applicable to the Company: vi. Acceptance of Deposits from Members and Public; appropriate, to the best of our understanding, to obtain 5. The compliance of the provisions of corporate and other 1. The Trade Marks Act, 1999; vii. Issuance of Bonus Shares by capitalization of Reserves / reasonable assurance about the correctness of the contents of applicable laws, rules, regulations, standards is the responsibility 2. Food Safety and Standards Act, 2006; Securities Premium Account; the secretarial records. The verification was done on test basis of management. Our examination was limited to the verification 3. West Bengal Excise Act, 1949. viii. Changes in Articles of Association of the Company; to ensure that correct facts are reflected in secretarial records. of compliance procedures on test basis. ix. Approval of Material Related Party Transactions; We believe that the processes and practices, we followed, We have also examined compliance with the applicable clauses of 6. The Secretarial Audit Report is neither an assurance as to provide a reasonable basis for our opinion. the following: x. Preferential Issue of Equity Shares; and the future viability of the Company nor of the efficiency or i. Secretarial Standards issued by The Institute of Company xi. Preferential Issue of Equity Share Warrants. 3. We have not verified the correctness, appropriateness and bases effectiveness or accuracy with which the management has Secretaries of India. of financial records, books of accounts and decisions taken by conducted the affairs of the Company. ii. The Listing Agreements entered into by the Company with Disclosure Stock Exchanges. This Report is to be read with our letter of even date which is During the period under review the Company has complied with annexed as Annexure A and forms an integral part of this Report. the provisions of the Act, Rules, Regulations, Guidelines, Standards, For Arpan Sengupta and Associates etc. mentioned above. For Arpan Sengupta and Associates Sd/- We further report that CS Arpan Sengupta The Board of Directors of the Company is duly constituted with Sd/- Proprietor proper balance of Executive Directors, Non-Executive Directors CS Arpan Sengupta Place: Kolkata, Membership No.: ACS 37706 and Independent Directors. The changes in the composition of the Proprietor Date: 28.04.2016 C.P. No.: 14416 Board of Directors that took place during the period under review Place: Kolkata, Membership No.: ACS 37706 were carried out in compliance with the provisions of the Act. Date: 28.04.2016 C.P. No.: 14416 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 34 35

VI. Variations in the market capitalization of the Company, price earnings ratio as at the closing date of the current Financial Year and Annexure – 3 previous Financial Year and percentage increase or decrease in the market quotations of the shares of the Company in comparison to the rate at which the Company came out with the last public offer in case of listed companies: PARTICULARS OF EMPLOYEES Particulars 31st March, 2016 31st March, 2015 % Change Closing Price (BSE) in H 121.50 54.78 121.82 [STATEMENT OF DISCLOSURE OF REMUNERATION PURSUANT TO SECTION 197 OF THE Market Capitalization (HIn million) 243.52 109.79 121.82 COMPANIES ACT, 2013 READ WITH RULE 5(1) OF THE COMPANIES (APPOINTMENT AND Price earnings Ratio 10.29 3.50 193.94 REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014] Particulars 31st March, 2016 Last % Change Market price (H) 121.50 10.00* 1115.00 *The Company come out with Initial Public Offer (IPO) in 1978 at H10/- per share. I. The ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the Financial Year VII. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last Financial 2015-2016 and the percentage increase in remuneration of each Director, Chief Financial Officer, Chief Executive Officer, Company Year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there Secretary or Manager, if any, in the Financial Year 2015-16: are any exceptional circumstances for increase in the managerial remuneration: Sl. No Name Designation Ratio of Remunera- Percentage Increase During the Financial Year 2015-16, average percentile increase already made in the salaries of employees other than the managerial tion of each Director in personnel was 14.21% which in view of the robust growth made by the Company during the Financial Year 2015-16, there was an increase to median remuner- Remuneration in the managerial remuneration under Section 197 of the Companies Act, 2013. The nominal increments were given to employees other ation of Employee than the managerial personnel during the Financial Year 2015-16 to provide for increased cost of living/ inflation in accordance with the 1 Mr. Monoranjan Roy Chairman & Managing Director 12.06:1 - Remuneration Policy of the Company. 2 Mr. Arup Thakur Executive Director & CFO 7.13:1 16.12% 3 Mr. Subrata Basu Executive Director 7.13:1 20.00% VIII. Comparison of the each remuneration of the Key Managerial Personnel against the performance of the Company: 4 Mr. JBS Negi Non-Executive Director - - The comparison of the each remuneration of the Key Managerial Personnel against the performance of the Company for the Financial Year 2015-16 are as follows: 5 Ms. Mou Roy Non-Executive Director - -

6 Mr. Abhijit Datta Non-Executive Director - - Name of KMP Designation % of Revenue % of EBITDA 7 Mr. Aditya Karwa Company Secretary 1.64:1 0.00% Mr. Monoranjan Roy Chairman & Managing Director 0.03% 0.53% II. The percentage increase in the median remuneration of employees in the Financial Year: The median remuneration of employees Mr. Arup Thakur Executive Director & CFO 0.02% 0.32% in the Financial Year 2015-16 has increased by 14.33% as compared to the previous year. Mr. Subrata Basu Executive Director 0.02% 0.32%

III. The number of permanent employees on the rolls of Company: Mr. Aditya Karwa Company Secretary 0.004% 0.07% As on March 31, 2016, 104 permanent employees were on the rolls of the Company. IX. The key parameters for any variable component of remuneration availed by the Directors: IV. The explanation on the relationship between average increase in remuneration and Company’s performance: During the Financial Year 2015-16, no variable component of remuneration has been availed by the Directors of the Company. Average increase in the remuneration of employees during the Financial Year 2015-16 was 14.33 %. In view of the robust growth X. The ratio of the remuneration of the highest paid Director to that of the employees who are not Directors but receive remuneration performance of the Company during the year, increased increments are justified as given to employees. in excess of the highest paid Director during the year: V. Comparison of the remuneration of the Key Managerial Personnel against the performance of the Company: During the Financial Year 2015-16, no employee has received remuneration in excess of the highest paid Director of the Company. The comparison of remuneration of the Key Managerial Personnel against the performance of the Company for the Financial Year 2015- XI. Affirmation that the remuneration is as per the remuneration policy of the Company: 16 is as follows: It is hereby affirmed that the remuneration paid during the Financial Year 2015-16 is as per the Remuneration Policy of the Company. Aggregate remuneration of KMPs in FY 2015-16 (Hin Lacs) 70.08 Revenue (Hin Lacs) 94,605.88 For and on behalf of the Board of Directors Remuneration of KMPs (as % of revenue) 0.07 Earnings before interest, depreciation and amortization and tax [EBITDA] (Hin Lacs) 5,610.41 Sd/- Remuneration of KMPs (as % of EBITDA) 1.25 Monoranjan Roy Place: Kolkata, Chairman & Managing Director Date: 28.04.2016 (DIN: 02275811) nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 36 37

Annexure – 4 Annexure – 5 PARTICULARS OF ENERGY CONSERVATION, FORM NO. AOC -2 TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS PURSUANT TO CLAUSE (H) OF SUB-SECTION (3) OF SECTION 134 OF THE ACT AND RULE 8(2) AND OUTGO REQUIRED UNDER THE COMPANIES (ACCOUNTS) RULES, 2014 OF THE COMPANIES (ACCOUNTS) RULES, 2014. A. CONSERVATION OF ENERGY: Form for Disclosure of particulars of contracts/arrangements entered into by the Company with related parties referred to in sub section (1) a) Energy conservation measures taken: -Nil- of Section 188 of the Companies Act, 2013 including certain arm’s length transaction under third proviso thereto. b) Additional investments and proposals, if any, being implemented for reduction of consumption of Energy: -Nil- c) Impact of the measures at (a) and (b) above for reduction of energy consumption and consequent impact on the - N.A.- 1. Details of contracts or arrangements or transactions not at Arm’s length basis. cost of production of goods: Sl. No Particulars Details d) Total energy consumption and energy consumption per unit of production as per Form A is given below: - N.A.- a) Name (s) of the related party & nature of relationship Nil b) Nature of contracts/arrangements/transactions Nil B. TECHNOLOGY ABSORPTION: Form for disclosure of particulars with respect to absorption c) Duration of the contracts/arrangements/transactions Nil A. RESEARCH AND DEVELOPMENT (R&D): d) Salient terms of the contracts or arrangements or transactions including the value, if any Nil 1. Specific areas in which R & D carried out by the Company N.A e) Justification for entering into such contracts or arrangements or transactions Nil 2. Benefits derived as a result of the above R & D. N.A f) Date of approval by the Board Nil 3. Future plan of action N.A g) Amount paid as advances, if any Nil 4. Expenditure on R & D N.A h) Date on which the special resolution was passed in General Meeting as required under first proviso Nil to section 188 B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION: 1 Efforts, in brief, made towards technology absorption, adaptation and innovation N.A 2. Details of contracts or arrangements or transactions at Arm’s length basis. 2. Benefits derived as a result of the above efforts, e.g. Product development, import substitution, etc. N.A Sl. No Particulars Details Details 3. In case of imported technology (imported during the last 5 years reckoned from the beginning of the Financial Year), N.A a) Name (s) of the related party & nature of relationship Priya Laboratories Pvt. Ltd. Yours Laboratories Pvt. Ltd. following information may be furnished: (Subsidiary Company) (Subsidiary Company) a) Technology imported N.A b) Nature of contracts/arrangements/transaction Conversion Charges Conversion Charges b) Year of import N.A c) Duration of the contracts/arrangements/transaction Nil Nil c) Has Technology been fully absorbed N.A d) Salient terms of the contracts or arrangements or transactions Nil Nil d) If not fully absorbed, area where this has not taken place reasons there for and future plans of action N.A including the value, if any e) Date of approval by the Board 22.04.2015 22.04.2015 C FOREIGN EXCHANGE EARNINGS AND OUTGO: f) Amount paid as advances, if any Nil Nil a) Activities relating to exports; initiatives taken to increase exports; development of new export markets for products and services and export plans b) Total foreign exchange used and earned: (H In Lacs) For and on behalf of the Board of Directors April 1, 2015 to April 1, 2014 to March 31, 2016 March 31, 2015 (i) Foreign Exchange earned 9.97 N.A Sd/- (ii) Foreign Exchange used 13.72 N.A Monoranjan Roy Place: Kolkata, Chairman & Managing Director For and on behalf of the Board of Directors Date: 28.04.2016 (DIN: 02275811)

Sd/- Monoranjan Roy Place: Kolkata, Chairman & Managing Director Date: 28.04.2016 (DIN: 02275811) nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 38 39

IV. SHARE HOLDING PATTERN Annexure – 6 (Equity Share Capital Breakup as Percentage of Total Equity) FORM NO. MGT-9 i) Category-wise Share Holding Category of Shareholders No. of Shares held at the beginning of the year No. of Shares held at the end of the year % Change EXTRACT OF ANNUAL RETURN [As on 1-April-2015] [As on 31-March-2016] during the Demat Physical Total % of Total Demat Physical Total % of Total year As on the Financial Year ended on March 31, 2016 Shares Shares A. Promoters’ [PURSUANT TO SECTION 92(3) OF THE COMPANIES ACT, 2013 AND RULE 12(1) OF THE COMPANIES 1. Indian a) Individual/ HUF ------(MANAGEMENT AND ADMINISTRATION) RULES, 2014] b) Central Govt ------c) State Govt(s) ------I. REGISTRATION AND OTHER DETAILS d) Bodies Corp. ------i. CIN L67120WB1978PLC031561 e) Banks / FI ------f) Any other ------ii. Registration Date 29-06-1978 Sub-Total (A) (1) ------iii. Name of the Company PINCON SPIRIT LIMITED 2. Foreign iv. Category/ Sub-Category of the Company Public Company Limited by Shares /Indian Non-Government Companies a) NRIs - Individuals ------b) Others - Individuals ------v. Address of the Registered office and Contact details 7, Red Cross Place, c) Bodies Corp. ------“Wellesley House” 3rd Floor, Kolkata – 700 001 d) Banks / FI ------Phone No. 033 – 2231-9135. Fax No. 033 – 4008-0690 e) Any other ------E-mail: [email protected] Sub-Total (A) (2) ------Website: www.pinconspirit.in Total Shareholding of Promoters ------(A)=(A)(1)+(A)(2) vi. Whether Listed Company Yes B. Public Shareholding vii. Name, Address and Contact details of Registrar and Transfer S. K. INFOSOLUTIONS PVT. LTD 1. Institutions Agent, If any 34/1A Sudhir Chatterjee Street, Kolkata- 700 006 a)Mutual Funds ------Phones : 033-2219-4815 & 033-2219-6797 b) Venture Capital Funds ------Fax : 033-2219-4815 c) Alternate Investment Funds ------d) Foreign Venture Capital Investors ------Email : [email protected], [email protected], e) Foreign Portfolio Investors - - - - 174,239 - 174,239 0.83 0.83 URL : www.skcinfo.com f)Financial Institutions/ Banks ------g) Insurance Companies ------II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY h) Provident Funds/ Pension Funds ------i) Any Other (specify) ------Sl. No Name and Description of Main Products/ Services NIC Code of the % to total Turnover Sub-total (B)(1):- - - - - 174,239 - 174,239 0.83 0.83 Product/Service of the Company 2. Non-Institutions 1. Wholesale of intoxicants like wines and liquors 46308 30.37 a) Bodies Corp. i) Indian 1,991,366 2,753,600 4,744,966 47.35 2,805,739 4325500 7,131,239 33.89 (13.46) 2. Refining & Packaging of Edible Oils (FMCG) 10401, 10402 29.70 ii) Overseas - - - - 3. Blending & Bottling of Indian Made Foreign Liquor 11011 26.95 b) Individuals - - - - 4. Blending & Bottling of Indian Made Indian Liquor 11012 12.97 i) Individual shareholders holding nominal 597,006 141,000 738,006 7.36 4,743,081 225,813 4,968,894 23.61 16.25 share capital upto H2 lakh ii) Individual shareholders holding 883,806 372,500 1,498,853 14.96 705,106 551,200 1,256,306 5.97 (8.99) III. PARTICULARS OF HOLDINGS, SUBSIDIARY AND ASSOCIATE COMPANIES nominal share capital in excess of H2 lakh c) Others (specify): Director2 2,993,393 - 2,993,393 29.87 5,986,786 1,000,000 6,986,786 33.20 3.33 Sl. No Name and CIN/GLN Holding/ Subsidiary % of Shares Application i) Non Resident Indians 37.00 - 37 0.00 195,494 195,494 0.93 0.93 Address of the Company Associate held Section ii) Overseas Corporate Bodies ------1 Priya Laboratories Pvt. Ltd. U24246WB2003PTC097219 Subsidiary 62.50% 2(87) iii) Foreign Nationals ------“Wellesley House” iv) Clearing Members 46,245 - 46,245 0.46 330,042 - 330,042 1.57 1.11 7, Red Cross Place, 3rd Floor v) Trusts ------vi) Foreign Bodies - D R ------Kolkata – 700 001 Sub-total (B)(2):- 6,754,400 3,267,100 10,021,500 100.00 14,766,248 6,102,513 20,868,761 99.17 (0.83) 2 Yours Laboratories Pvt. Ltd. U24231WB2005PTC106783 Subsidiary 100.00% 2(87) Total Public Shareholding (B)=(B)(1)+ 6,754,400 3,267,100 10,021,500 100.00 14,940,487 6,102,513 21,043,000 100.00 (0.00) 28T, Ramakrishna Samadhi Road (B)(2) Kolkata – 700 054 C. Shares held by Custodian for GDRs ------3 Paul Distributors Pvt. Ltd. U51109WB1995PTC072426 Subsidiary 55.00% 2(87) & ADRs Grand Total (A+B+C)1 6,754,400 3,267,100 10,021,500 100.00 14,940,487 6,102,513 21,043,000 100.00 (0.00) 247/C Raipur Road, Bagha Jatin Street, Note: 1. The total number of Equity Shares has increased due to issuance of bonus share in October 2015 in the ratio 1:1 Kolkata-700092 2. Includes Equity shares of 1000000 as of March 31, 2016 issued on preferential basis to the CMD Mr. Monoranjan Roy allotted made on 30.03.2016. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 40 41 ii) Shareholding of Promoters v) Shareholding of Directors and Key Managerial Personnel

Sr. No. Shareholder’s Name Shareholding at the beginning of the year Shareholding at the end of the year % change in Sl. No For Each of the Top Shareholding at the Increase/Decrease in shareholding during the year Cumulative Shareholding shareholding Shareholders beginning of the year at the end of the year No. of Shares % of total %of Shares No. of Shares % of total %of Shares during the i.e. on April 01, 2015 i.e. on March 31, 2016 Shares of the Pledged / Shares of the Pledged / year Company encumbered Company encumbered No. of % of total 01/04/2015 to 01/07/2015 01/10/2015 01/01/2016 No. of % of total to total to total Shares Shares 30/06/2015 to to to Shares Shares shares shares of the 30/09/2015 31/12/2015 31/03/2016 of the Company Company ------1. Monoranjan Roy 2993393 29.87 - - 29933931 10000002 6986786 33.20 (Chairman & Managing Director) iii) Change in Promoters’ Shareholding (Please specify, if there is no change) Note: 1. The total number of Equity Shares has increased due to issuance of bonus share in October 2015 in the ratio 1:1 Shareholding at the beginning of Cumulative Shareholding during 2. Includes Equity shares of 1000000 as of March 31, 2016 issued on preferential basis to the CMD Mr. Monoranjan Roy allotment made on 30.03.2016. the year the year

Sl. No. Particulars No. of shares % of total No. of Shares % of total shares of the shares of the company company at the end of year V. INDEBTEDNESS At the beginning of the year - - - - Indebtedness of the Company including interest outstanding/accrued but not due for payment Hin Lacs Date wise Increase / Decrease in Promoters Shareholding during the year N.A. specifying the reasons for increase / decrease (e.g. allotment /transfer / PARTICULARS Secured Loans Unsecured Deposits Total bonus/ sweat equity etc.) excluding deposits Loans Indebtedness At the end of the year - - - - Indebtedness at the beginning of the Financial Year i) Principal Amount 920,788,668.00 600,000,000.00 - 1,520,788,668.00 iv) Shareholding Pattern of top ten Shareholders (Other than Directors, Promoters and Holders of GDRs and ADRs) ii) Interest due but not paid - - - - Shareholding at the Cumulative Shareholding iii) Interest accrued but not due - - - - beginning of the year at the end of the year Total (i+ii+iii) 920,788,668.00 600,000,000.00 - 1,520,788,668.00 i.e. on April 01, 2015 i.e. on March 31, 2016 Sl. No. For Each of the Top Shareholders No. of shares % of total No. of shares % of total Change in Indebtedness during the Financial Year 600,000,000.00 - 1,520,788,668.00 Shares Shares * Net Change 998,917,544.00 17,500,000.00 1,016,417,544.00 of the Company of the Company Indebtedness at the end of the Financial Year 1 Jaibishwambhar Traders Private Limited # - - 1,000,000 4.75 2 Omshaktidev Realestate Private Limited # - - 900,000 4.28 i) Principal Amount 1,919,706,212.00 617,500,000.00 2,537,206,212.00 3 Shivmani Projects Private Limited # - - 900,000 4.28 ii) Interest due but not paid - - - - 4 Youthvision Commodities Private Limited # - - 777,890 3.70 iii) Interest accrued but not due - - - - 5 Coinage Tradecomm Private Ltd # - - 760,000 3.61 Total (i+ii+iii) 1,919,706,212.00 617,500,000.00 - 2,537,206,212.00 6 Ajay Tiwari $ 122,700 1.22 245,400 1.17 Note: 7 Rajasthan Global Securities Private Limited # - 204,416 0.97 1. Conversion of Unsecured Loan of Mr. Monoranjan Roy into Equity Shares on preferential basis as approved by the Shareholders on 22.03.2016 in the EGM 8 Kemnay Investment Fund Ltd # - - 174,239 0.83 & allotment of same on 30.03.2016 9 VLS Finance Ltd # - - 166,200 0.79 10 JIT Software Solution (P) Ltd. $ 75,000 0.75 150,000 0.71 11 Hari Singh @ 199,790 1.99 88,000 0.42 12 Anushri Textiles Pvt Ltd @ 1,090,998 10.89 34,920 0.17 13 Gomti Commercial Pvt Ltd @ 230,000 2.30 30,000 0.14 14 Anima Credit & Investments Pvt Ltd* 500,000 4.99 - - 15 Accent Commerce Pvt Ltd* 450,000 4.49 - - 16 Cuckoo Merchandise Pvt Ltd* 450,000 4.49 - - 17 Graceful Advisory Services Pvt Ltd* 380,000 3.79 - - 18 Profitus Commodities Pvt Ltd* 190,000 1.90 - - 19 Dipankar Basu* 190,000 1.90 - - 20 Bam Basuki & Investments Pvt Ltd* 168,100 1.68 - - Note: # New members purchased during the year *Sold out fully by the members during the members $ Change in no of share due to allotment of bonus share @ Change in their holding positions due to sale by those shareholders. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 42 43

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL VII. PENALTIES/PUNISHMENT/COMPOUNDING OF THE OFFENCES

A. Remuneration to Managing Director, Whole-time Directors and/or Manager H in Lacs Type Section of the Brief Details of Penalty Authority Appeal made, Companies Act Description / Punishment/Compounding [RD / NCLT/ COURT] if any (give Details) Sl. Particulars of Remuneration Name of MD/WTD/ Manager fees imposed No. Monoranjan Roy Arup Thakur Subrata Basu Total Amount A. COMPANY Chairman & Managing Executive Director Executive Director & CFO Director Penalty Gross salary Punishment (a) Salary as per provisions contained in 3,000,000.00 1,800,000.00 1,800,000.00 6,600,000.00 Compounding section 17(1) of the Income-tax Act, 1961 B. DIRECTORS 1 (b) Value of perquisites u/s 17(2) Income-tax Act, 1961 Nil Nil Nil Nil There were no penalties/punishment/compounding of offences for Penalty breach of any section of the Companies Act against the Company or its Directors or other (c) Profits in lieu of salary under section 17(3) Income- tax Act, 1961 Nil Nil Nil Nil Punishment Officers in Default during the Financial Year 2015-16. 2 Stock Option Nil Nil Nil Nil Compounding 3 Sweat Equity Nil Nil Nil Nil C. OTHER OFFICERS IN DEFAULT Commission Penalty 4 - as % of profit Nil Nil Nil Nil Punishment - others, specify… Compounding 5 Others, please specify Nil Nil Nil Nil Total (A) 3,000,000.00 1,800,000.00 1,800,000.00 6,600,000.00 For and on behalf of the Board of Directors Ceiling as per the Act H2.49 Crore (being 10% of the net profits of the Company calculated as per Section 198 of the Companies Act, 2013) Sd/- Monoranjan Roy

B. Remuneration to Other Directors and/or Managers Hin Lacs Place: Kolkata, Chairman & Managing Director Sl. No. Particulars of Remuneration Name of Directors Total Amount Date: 28.04.2016 (DIN: 02275811) Kunal Saxena1 Abhijit Datta2 JBS Negi Mou Roy 1 Independent Directors Fee for attending board & committee meetings 280,000.00 20,000.00 140,000.00 320,000.00 760,000.00 Commission - - - - - Others, please specify - - - - - Total (1) 280,000.00 20,000.00 140,000.00 320,000.00 760,000.00 2 Other Non-Executive Directors - - - - - Fee for attending board committee meetings - - - - - Commission - - - - - Others, please specify - - - - - Total (2) - - - - - Total (B)=(1+2) 280,000.00 20,000.00 140,000.00 320,000.00 760,000.00 Total Managerial Remuneration (A+B) 7,360,000.00 Overall Ceiling as per the Act H0.249 Crore (being 10% of the net profits of the Company calculated as per Section 198 of the Companies Act, 2013).

Note: 1. Mr. Kunal Saxena, Resigned on 09.02.2016 2. Mr. Abhijit Datta, Appointed on 09.02.2016

C. Remuneration to Key Managerial Personnel other than MD/MANAGER/WTD Hin Lacs Sl. No. Particulars of Remuneration Key Managerial Personnel CS Aditya Karwa Total Gross salary (a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961 408,000.00 408,000.00 1 (b) Value of perquisites u/s 17(2) Income-tax Act, 1961 - - (c) Profits in lieu of salary under section 17(3) Income-tax Act, 1961 - - 2 Stock Option - - 3 Sweat Equity - - 3 Commission - - - as % of profit - - others, specify… - - 5 Others, please specify - - Total 408,000.00 408,000.00 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 44 45

Annexure – 7

ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES

A. Corporate Social Responsibility Initiatives E. Details of CSR spend for the Financial Year 2015-16: As part of its initiatives under “Corporate Social Responsibility” (CSR), the Company has Constituted Corporate Social Responsibility Committee a) Total amount spend for the Financial Year: H20.00 Lacs. in line with Section 135 of the Companies Act, 2013 read with Schedule VII. For the year 2015-16 CSR would be implemented in association b) Amount unspent, if any: H13.66 lac. with Belaria Humanity Welfare Society, established under West Bengal Society Registration Act 1961, as NGO to grant donations to poor and c) Manner in which the amount spends during the Financial Year 2015-16 is detailed below: the needy for meeting expenditure of education, medical treatments and any other charitable purpose; to establish, run, support and grant 1 2 3 4 5 6 7 8 aid or other financial assistance to schools, libraries laboratories, research and other institutions of the like nature in India. CSR Policy – As per Sl No CSR project or Sector in which the Projects or Amount outlay Amount spent in Cumulative Amount recommendation of CSR Committee Board has approved CSR Policy at the Board Meeting held on 17th October, 2015. The constitution and activity identified project is covered programmes (budget project or each project or expenditure upto Spent: 1. Local area or programme wise) programme the report period Direct or through composition of the said Policy can be viewed from Company website. other Direct expenditure implementation 2. State of project Overhead agencies During the Financial year ended 31st March, 2016, 2 Meetings were held on 31st October, 2015 & 21st January, 2016. 1. Education, Medical • Eradication of Local Project at H33.66 Lacs H20.00 Lacs H20.00 Lacs Through treatments and any Extreme poverty and Kolkata, Implementing Other charitable hunger (Clause (i) of 24 - Parganas (N & S) Agency Belaria B. Composition, Name of Members and Chairperson purpose Schedule VII) (West Bengal) Humanity Welfare The composition and attendance of Members at the Meetings of the Nomination & Remuneration committee held during 2015-16 are as Society • Eradication of follows: Malnutrition (Clause Name of the Directors Category No. of Meetings Held (i) of Schedule VII) • Sanitation and Held Attended making available safe drinking 1 Mr. Kunal Saxena Chairman (Resigned on 09.02.2016) 2 2 water (Clause (i) of Mr. JBS Negi Chairman (Appointed on 09.02.2016 ) 2 2 Schedule VII) Mr. Subrata Basu Member 2 2 Total H33.66 Lacs H20.00 Lacs H20.00 Lacs * Implementation Agency is Belaria Humanity Welfare Society. Ms. Mou Roy Member (Inducted in the Committee on 09.02.2016) 0 0 Note: F. Reason for failure to spend Budgeted Amount 1. Mr. Kunal Saxena, Resigned on 09.02.2016 The shortfall in the budgeted CSR expenditure during the Financial Year 2015-16 relates to certain CSR projects of ongoing nature C. Average net profit of the Company for last Three Financial Years: undertaken by the Company spanning over multiple years and the same is being spent by the Company across the life of these projects. Average net profit:H 1682.92 Lacs G. A responsibility statement of the CSR Committee that the implementation and monitoring of CSR D. Prescribed CSR Expenditure (Two percent of the amount as in item C above) Policy, is in compliance with the CSR objectives and Policy of the Company: The Company is required to spend H33.66 Lacs. The CSR Committee confirms that the implementation and monitoring of the CSR Policy of the Company is in compliance with the CSR objectives and CSR Policy of the Company.

Sd/- Sd/- Place: Kolkata JBS Negi Monoranjan Roy Date: 28.04.2016 Chairperson – CSR Committee Chairman & Managing Director nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 46 47

Board Meeting: During the year ended March 31, 2016, 18 (Eighteen) Board Meetings held as against the minimum requirement of four meeting. The maximum time gap between any of the two consecutive meeting did not exceed four months.

The details of Board Meetings are given below:

Date Board Strength No. of Directors Present Report on Corporate Governance 22nd April 2015 6 5 21st May 2015 6 6 11th June 2015 6 6 16th June 2015 6 3

The Directors present the Company’s Report on Corporate Governance. 08th July 2015 6 5 06th August 2015 6 6 I. MANDATORY REQUIREMENTS 26th August 2015 6 5 1. COMPANY ‘S PHILOSOPHY ON CORPORATE GOVERNANCE 19th September 2015 6 5 PINCON SPIRIT LIMITED (“PSL”/ “the Company”/“Company”) is committed to implement sound Corporate Governance practices to ensure 29th September 2015 6 5 transparency in its operations and maximize Stakeholders’ value. The Company’s core philosophy on the code of Corporate Governance 12th October 2015 6 5 is to abide by the following practices: 28th October 2015 6 5 Board accountability to the Company and Shareholders 31st October 2015 6 6 Strategic guidance and effective monitoring by the Board 16th November 2015 6 3 Protection of minority interests and rights 15th December 2015 6 5 21st January 2016 6 6 Equitable treatment of all Shareholders 09th February 2016 6 6 2. BOARD OF DIRECTORS 25th February 2016 6 6 The Board of Directors along with its Committees provides leadership and guidance to the Company’s Management and supervises 30th March 2016 6 4 the Company’s performance. As at March 31, 2016 the Board of Directors (“Board”) comprises of 6 (Six) Directors out of which 3 (Three) Attendance of Directors at the meetings: Directors are Non-Executive Directors. The details of the attendance of the Directors at the Board Meetings held during the year ended March 31, 2016 and at the last Annual The Composition of the Board of Directors is in conformity with Regulation 17 of the Securities and Exchange Board of India (Listing General Meeting (AGM) are given below: Obligations and Disclosure Requirements) Regulations, 2015. Name of the Directors Number of Board Meetings Attendance at AGM The Composition and Category of the Board of Directors is as follows: Held Attended Held on December 26, 2015 Name of the Directors Designation Category Directorship held in other Mr. Monoranjan Roy 18 18 Yes companies # Mr. Arup Thakur 18 18 Yes Mr. Monoranjan Roy Chairman & Managing Director Executive Director 10 Mr. Subrata Basu 18 18 Yes Mr. Arup Thakur Executive Director Executive Director & CFO 8 Mr. Kunal Saxena1 16 14 No Mr. Subrata Basu Executive Director Executive Director 4 Mr. JBS Negi 18 7 No Mr. JBS Negi Non-Executive Director Independent Director 2 Ms. Mou Roy 18 16 Yes Mr. Kunal Saxena1 Non-Executive Director Independent Director - Mr. Abhijit Datta2 3 1 No Ms. Mou Roy Non-Executive Director Independent Women Director 3 Mr. Abhijit Datta2 Non-Executive Director Independent Director 6 Note: 1. Mr. Kunal Saxena, Resigned on 09.02.2016 Note: 2. Mr. Abhijit Datta, Appointed on 09.02.2016 1. Mr. Kunal Saxena, Resigned on 09.02.2016 2. Mr. Abhijit Datta, Appointed on 09.02.2016 # Including Private Limited None of the Directors hold Directorship in more than 15 Companies. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 48 49

PROFILE OF BOARD OF DIRECTORS MR. SUBRATA BASU A. AUDIT COMMITTEE Brief resume of the Directors, nature of their expertise in specific Mr. Subrata Basu (DIN. 06758717) aged about 48 years, Post Graduate Terms of Reference and Composition, Names of Members and Chairman functional areas and name of Companies in which they hold in Commerce from University of Calcutta has almost two decades The powers of the Audit Committee are as mentioned in Regulation 18 of The Securities and Exchange Board of India (Listing Obligation directorship and membership of the committees of the Board are of banking experience at senior level in a reputed public sector & Disclosure Requirements) Regulations, 2015. The terms of reference of this Committee are wide enough covering the matters specified furnished hereunder: & private sector bank with experience in processing large value for Audit Committee under The Securities and Exchange Board of India (Listing Obligation & Disclosure Requirements) Regulations, 2015. proposals, corporate finance proposals, supervising & monitoring The Committee acts as a link between the Management, the Statutory and the Internal Auditors on one side and the Board of Directors MR. MONORANJAN ROY credit administration activities for east, north-east & central zone. of the Company on the other side and oversees the financial reporting process. Mr. Monoranjan Roy (DIN. 02275811) is Masters in Economics & He also served as VP-Corporate Business Development with reputed The Internal Auditors are permanent invitees of the Audit Committee. The Statutory Auditors are also invited to attend the meetings. Masters in Business Management. Mr. Monoranjan Roy aged about Financial Insitution. His diversified experience in Banking & Finance, 41 years is a successful industrialist having business experience of provide immense insight in managing business financial structure During the Financial year ended 31st March, 2016, 4 Meetings were held on 21st May, 2015, 06th August, 2015, 31st October, 2015 & 21st over 18 years. He started his business career at a very tender age. By within laid down prudential norms January 2016. virtue of his extreme hard work and honest endeavour for achieving Composition, Name of Member and Chairperson business goals, he has been able to create a commendable position MR. JAG BAHADHUR SINGH NEGI (INDEPENDENT DIRECTOR) The composition and attendance of Members at the Meetings of the Audit Committee held during 2015-16 are as follows: in the business circle. Mr. Roy is having all the traits of being an Mr. Negi is a retired IPS officer. His presence in the Board and his entrepreneur of big magnitude. He is having the requisite aptitude advice has enabled the Company in expanding business at a fast Name of the Directors Category No. of Meetings Held for adapting himself in various types of business activities with the pace. Held Attended ultimate result being a “successful business venture”. The Group MS. MOU ROY (INDEPENDENT DIRECTOR) Mr. Kunal Saxena1 Chairman (Resigned on 09.02.2016) 4 4 headed by Mr. Roy, is a multi crores business conglomerate, having Ms. Mou Roy is Practicing Advocate in Calcutta High Court. During Mr. JBS Negi Chairman (Appointed on 09.02.2016) 4 4 business forays in to Indian Made Foreign Liquor, FMCG, Real Estates the course of her profession, she gained vast exposure and & Civil Infrastructure. Mr. Subrata Basu Member 4 4 knowledge in the field of criminal and civil law, which helped the Ms. Mou Roy Member (Inducted in the Committee on 09.02.2016) 0 0 Apart from being honoured by the “Excellence Award” as the Company in various compliance related aspects. Note: Entrepreneur of the year 2011 by “Institute of Economic Studies”, 1. Mr. Kunal Saxena, Resigned on 09.02.2016 he has recently been winner under “Outstanding Entrepreneur MR. ABHIJIT DATTA (INDEPENDENT DIRECTOR) Category”, conferred by 6th Annual Asia Pacific Entrepreneurship Mr. Abhijit Dutta is the retired Deputy Managing Director of State Awards (APEA) India 2015, Asia’s one of the most prestigious awards. Bank of India. He is a Masters in Economics from the Presidency B. STAKEHOLDERS RELATIONSHIP COMMITTEE College, Kolkata. During his long service career with the Bank as the The powers of the Stakeholders Relationship Committee are as mentioned in are as mentioned in Regulation 27(1) & (2) of The Securities MR. ARUP THAKUR Mid Corporate Head, he worked in various specialized segments viz. and Exchange Board of India (Listing Obligation & Disclosure Requirements) Regulations, 2015. The terms of reference of this Committee Mr. Arup Thakur, (DIN. 03476120) aged about 52 years, is a Chartered Credit Compliance, Resolving Stressed Assets, Fund Management, are wide enough covering the matters specified for Stakeholders Relationship Committee under the Securities and Exchange Board of Accountant by profession, with experience of more than 23 years Interacting with International Banks / Agencies / Regulatory India (Listing Obligation & Disclosure Requirements) Regulations, 2015. The Committee oversees the transfer of shares lodged for transfer, in Accounts, Audit, Finance, Investments. During the course of his Authorities like Federal Reserve Bank, Federal Deposit Insurance transmission, dematerialization/rematerialization, split and stock option allotments and complaints received from shareholders and other professional career, he gained vast exposure in the field of Bank Corporation. Apart from having worked in very senior position in statutory bodies. The Company’s Registrars and Share Transfer Agents, have adequate infrastructure to process the above mentioned activities. Audit, Audit of Govt. Undertakings and other sundry audit. He has overseas posting, in India he also headed segments like Capital also acquired an in depth exposure in Project Feasibility Study and Markets, Structured Finance, Treasury, etc. Number of Shareholders complaints pending so far. Project Appraisal. His diversified experience in finance, accounts, After retirement from SBI, he had been appointed as Chairman of During the year ended March 31, 2016, no complaints were pending for Redressal either at the beginning or at the end of the year audit and investment management shall help the Company in Asset Reconstruction Company (India) Limited (ARCIL) and the term maintaining the business activity within laid down prudential norms. During the Financial year ended 31st March, 2016, 4 Meetings were held on 21st May, 2015, 06th August, 2015, 31st October, 2015 & 21st ended in 2012 with the largest Asset Recovery reconstruction in the He is entrusted with the responsibility of taking overall finance and January 2016. Country. investment decisions of the company. Composition, Name of Member and Chairperson The composition and attendance of Members at the Meetings of the Stakeholders Relationship Committee held during 2015-16 are as 3. BOARD COMMITTEES: follows: The Company currently has the following committees of the Board: Name of the Directors Category No. of Meetings Held A. AUDIT COMMITTEE Held Attended B. STAKEHOLDERS RELATIONSHIP COMMITTEE Mr. Kunal Saxena1 Chairman (Resigned on 09.02.2016) 4 4 C. NOMINATION AND REMUNERATION COMMITTEE Mr. JBS Negi Chairman (Appointed on 09.02.2016) 4 4 D. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE Mr. Subrata Basu Member 4 4 E. RISK MANAGEMENT COMMITTEE Ms. Mou Roy Member (Inducted in the Committee on 09.02.2016) 0 0 F. GENERAL COMMITTEE OF DIRECTORS Note: 1. Mr. Kunal Saxena, Resigned on 09.02.2016 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 50 51

C. NOMINATION AND REMUNERATION COMMITTEE D. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE The Nomination and Remuneration Committee of the Board recommends to the Board, from time to time, compensation package for Corporate Social Responsibility Initiatives Whole-Time Members of the Board. As part of its initiatives under “Corporate Social Responsibility” (CSR), the Company has Constituted Corporate Social Responsibility Committee in line with Section 135 of the Companies Act, 2013 read with Schedule VII. For the year 2015-16 CSR was implemented During the Financial year ended 31st March, 2016, 1 Meeting were held on 21st May, 2015. in association with Belaria Humanity Welfare Society, established under West Bengal Society Registration Act 1961, as NGO to grant Composition, Name of Member and Chairperson donations to poor and the needy for meeting expenditure of education, medical treatments and any other charitable purpose; to The composition and attendance of Members at the Meetings of the Nomination & Remuneration committee held during 2015-16 are establish, run, support and grant aid or other financial assistance to schools, libraries, laboratories, research and other institutions of the as follows: like nature in India. CSR Policy – As per recommendation of CSR Committee Board has approved CSR Policy at the Board Meeting held on 17th October, 2015. The constitution and composition of the said Policy can be viewed from Company website. Name of the Directors Category No. of Meetings Held Held Attended During the Financial year ended 31st March, 2016, 2 Meetings were held on 31st October, 2015 & 21st January, 2016. Mr. Kunal Saxena1 Chairman (Resigned on 09.02.2016) 1 1 Composition, Name of Member and Chairperson Mr. JBS Negi Chairman (Appointed on 09.02.2016) 1 1 The composition and attendance of Members at the Meetings of the Nomination & Remuneration committee held during 2015-16 are Mr. Subrata Basu Member 1 1 as follows: Ms. Mou Roy Member (Inducted in the Committee on 09.02.2016) 0 0 Name of the Directors Category No. of Meetings Held Note: Held Attended 1. Mr. Kunal Saxena, Resigned on 09.02.2016 Mr. Kunal Saxena1 Chairman (Resigned on 09.02.2016) 2 2 Remuneration to Executive Director Mr. JBS Negi Chairman (Appointed on 09.02.2016) 2 2 The details of remuneration paid to the Executive Directors of the Company for attending the Board and Committee Meetings for the year Mr. Subrata Basu Member 2 2 2015-16 are as follows: Ms. Mou Roy Member (Inducted in the Committee on 09.02.2016) 0 0 Name Salary Paid Note: Mr. Monoranjan Roy H3,000,000.00 1. Mr. Kunal Saxena, Resigned on 09.02.2016 Mr. Arup Thakur H1,800,000.00 E. RISK MANAGEMENT COMMITTEE and have underutilized capacities, which, in turn, may lead to Mr. Subrata Basu H1,800,000.00 In line with the provisions of the Companies Act, 2013 low margins. To mitigate this risk, the Company complies with Total H6,600,000.00 and The Securities and Exchange Board of India (Listing all the applicable rules and regulations in all the States where it Remuneration to Non-Executive Directors Obligation & Disclosure Requirements) Regulations, 2015, the is present. Company has adopted a Risk Management Policy to identify Non-Executive Directors are being paid sitting fee of H20,000.00 per meeting of the Board. II. Strategic Risk and evaluate elements of business risks. The Policy defines The details of remuneration paid to the Non-Executive Directors of the Company for attending the Board and Committee Meetings for the The Company’s strategy and its execution is dependent on the risk management approach, establishes various levels year 2015-16 are as follows: uncertainties and untapped opportunities. To mitigate this risk, of accountability for risk Management / mitigation within the Company has adopted resilient policies which not only Name Sitting Fees Paid the Company and reviewing, documentation and reporting allow the Company to maximize opportunities under normal Mr. JBS Negi H140,000.00 mechanism for such risks. conditions but also ensure that acceptable results are achieved 1 Mr. Kunal Saxena H280,000.00 The Risk Management Committee has been entrusted with under extra-ordinary adverse conditions. Ms. Mou Roy H320,000.00 the responsibilities of developing risk mitigation plans, III. Concentration Risk Mr. Abhijit Datta2 H20,000.00 implementing risk reduction/mitigation strategies and A large percentage of the Company’s turnover is derived from Total H760,000.00 reviewing the effectiveness of the Risk Management Policy. Eastern India, where any unfavourable regulatory policy may Note: The key business risks, which in the opinion of the Board of impact its business. The Company’s three business segments 1. Mr. Kunal Saxena, Resigned on 09.02.2016 Directors may threaten the existence of the Company, along are evenly distributed in the revenue pie contributing to the 2. Mr. Abhijit Datta, Appointed on 09.02.2016 with mitigation strategies adopted by the Company are revenue stream in the following manner IMFL segment 57% Nomination, Remuneration and Evaluation Policy of the Company which lays down criteria for: enumerated herein below: IMIL segment 13% and FMCG segment 30%. To mitigate this risk, I. Determining qualifications, positive attributes required for appointment of Directors, Key the Company has extended its focus on other geographies viz. II. Managerial Personnel and Senior Management and also the criteria for determining the independence of a Director; I. Regulatory Risk III. Appointment, tenure, removal/retirement of Directors, Key Managerial Personnel and Senior Management; Southern Region, etc. and product categories viz. Whisky, Vodka, The IMFL & IMIL industry is a high-risk industry, primarily on IV. Determining remuneration (fixed and performance linked) payable to the Directors, Key Managerial Personnel and Senior Management; and etc. The Company’s recent aquisition would significantly add to V. Evaluation of the performance of the Board and its constituents. account of high taxes and innumerable regulations governing the contribution from the segment. The detail content of Nomination, Remuneration and Evaluation Policy is published on the website. it. As a result, liquor companies suffer from low pricing flexibility nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 52 53

F. GENERAL COMMITTEE OF DIRECTORS 5. DISCLOSURES: premium of H125/- per share on preferential basis to In view of the difficulties in convening Board Meeting[s] with requisite quorum at short notice, for matters requiring immediate and a) Related party transactions: Mr. Monoranjan Roy as approved by the Shareholders at prompt action, on behalf of the Company, the Board constituted a Committee of Directors. During the year ended March 31, 2016 there were the EGM held on 22.03.2016 & allotment was done on 30.03.2016 towards the part conversion of unsecured loan. The powers to be delegated to the Committee of Directors consisting of Mr. Monoranjan Roy, Mr. Arup Thakur & Mr. Subrata Basu are materially significant related party transactions for which regulated by the Board of Directors from time to time. There were 2 occasions for the General Committee to meet during the year 2015-16 adequate disclosure is made in the Annual Accounts regarding related party transactions. 6. MEANS OF COMMUNICATION 4. GENERAL BODY MEETINGS a) Half-Yearly Report sent to each household of b) Disclosure of Accounting Treatment: shareholders : No The details of date, location and time of the last 3 years Annual General Meetings held on as under: The Company has followed the Accounting Standards Financial year Year Ended Date & Time Venue Special Resolution Passed notified under Companies (Accounting Standards) Rules, b) Quarterly results Ended March, 31 2006 in the preparation of its Financial Statements. The quarterly results of the Company are published 37th 31.03.2015 December 26, The Peerless Inn Appointment of Ms. Mou Roy (DIN: 07144271) as an in accordance with the requirements of the listing c) Code of Conduct 2015 at 11.00 AM 12, Jawaharlal Independent Director upto March 30, 2020. agreement, in widely circulated newspapers like Business The Board has laid down a Code of Conduct covering the Nehru Road, Kolkata Re-appointment of Mr. Monoranjan Roy (DIN: Standard, Anandabazar Patrika etc. – 700 013 02275811) as Chairman and Managing Director upto ethical requirements to be complied with covering all the c) News releases, presentations etc. August 09, 2020. Board members and Senior Management Personnel of the Official Releases along with Quarterly Results are displayed Changes in Articles of Association of the Company. Company. An affirmation of compliance with the code is on the Company’s website: www.pinconspirit.in Approval of Material Related Party Transactions received from them on an annual basis. 36th 31.03.2014 September 29, 7, Red Cross Place, Adoption of new Articles of Association of the d) CEO and CFO Certification Presentations were also made to the media, analysts. 2014 11.00 AM “Wellesley House” Company The Managing Director and the CFO have given a Certificate Institutional investors, fund managers, among other form 3rd Floor, Borrowing Power Under Section 180(1)© and any to the Board as contemplated under Regulation 17(8) of time other applicable provisions of the Companies Act, 2013 Kolkata – 700 001 the SEBI (Listing Obligations and Disclosure Requirements) During the year ended March 31, 2016 the Company has To create such charges, mortgages and hypothecations Regulations, 2015 and is separately annexed. made presentations to the investors/analysts. Which is in addition to the existing charges, mortgages and duly submit to the Stock exchanges. hypothecations created by the Company, Under Section e) Proceeds from public issues, rights issues, preferential 180(1)(a) and any other applicable provisions of the issues etc. d) Management Discussion and Analysis (MDA) Report Companies Act, 2013. During the year ended March 31, 2016, company has The report on MDA is annexed to the Directors’ Report and 35th 31.03.2013 June 04, 2013 7, Red Cross Place, No Special Resolution was passed in the meeting allotted 1000000 Equity Share of H10 per share at the forms part of this Annual Report. 11.00 AM “Wellesley House” 3rd Floor, 7. GENERAL SHAREHOLDER INFORMATION Kolkata – 700 001 1. Company Registration Details The Company is registered in the State of West Bengal, India. The Corporate Identification Number (CIN) allotted to the Company by the Details of Extraordinary General Meetings held during the Financial Year 2015-16 Ministry of Corporate Affairs (MCA) is L67120WB1978PLC031561. Date & Time Venue Special Resolution Passed 25th July, 2015 at 11.00 A.M The Peerless Inn Issue of Secured, Rated, Listed, Non-Convertible, Cumulative, 2. Annual General Meeting : 38th Annual General Meeting 12, Jawaharlal Nehru Road, Redeemable, Taxable Debentures. : Monday, June 06, 2016 at 11.00 A.M Kolkata – 700 013 Approval of borrowing limits of the Company : The Peerless Inn Creation of Charge on the assets of the Company : 12, Jawaharlal Nehru Road, Kolkata, West Bengal 700013, India Increase of Authorised Capital of the Company 3. Financial Year : April 1, to March 31. Change Clause V of the Memorandum of Association of the Company 4. Financial Calendar (tentative) Results for the quarter ending Acceptance of Deposits from Members and Public June 30, 2016 : July/August, 2016 29th September, 2015 at 11.00 A.M The Peerless Inn Issuance of Bonus Shares by Capitalizations of Reserves / Securities September 30, 2016 : October/November, 2016 12, Jawaharlal Nehru Road, Premium Account December 31, 2016 : January/February, 2017 Kolkata – 700 013 March 31, 2017 : April/May, 2017 22nd March, 2016 at 11.30 A.M. The Peerless Inn Preferential Issue of Equity Shares 5. Date of Book Closure : May 31 to June 6, 2016 (Both days inclusive) 12, Jawaharlal Nehru Road, Preferential Issue of Equity Share Warrants 6. Dividend Payment Date : A Dividend payment of H0.75 i.e., 7.50% per Equity Share of H10.00 each will be Kolkata – 700 013 paid by 21th June 2016 subject to the approval of the members in the ensuing Annual General Meeting. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 54 55

7. Listing on Stock Exchanges : Company Equity Shares are listed at: 13. Stock Performance in comparison to BSE Sensex (Based on closing prices of Pincon Spirit Limited and BSE Sensex) Sl. No. Name of the Stock Exchanges Address Apr 01, 2015 - Mar 31, 2016 1. The Calcutta Stock Exchange Limited (CSE) 7, Lyons Range, Kolkata 700 001 200% 2. BSE Limited (BSE) Phiroze Jeejeebhoy Towers 150% Dalal Street

Mumbai- 400001 100%

8. Listing Fees to Stock Exchanges 50% The Annual Listing fee for the year 2016-17 has been paid by the Company to all exchanges within stipulated time. 0% 9. Payment of Depository Fee Annual Custody/Issuer fee for the year 2016-17 will be paid by the Company to NSDL and CDSL on receipt of the invoices. -50% Apr’ 15 May 15 Jun’ 15 Jul’ 15 Aug’ 15 Sep’ 15 Oct’ 15 Nov’ 15 Dec’ 15 Jan’ 16 Feb’ 16 Mar’ 16 10. International Securities Identification Number (ISIN) of the Company SENSEX - 13.28% 538771 + 137.66% International Securities Identification Number (ISIN) of the Company’s shares in the dematerialised mode, as allotted by NSDL and CDSL is INE675G01018 14. Registrar & Share Transfer Agents: For Shares held in both Physical and Demat mode 11. Scrip Code & Scrip Name S.K. INFOSOLUTIONS PVT. LTD Sl. No. Name of the Stock Exchanges Script Name, Script Code (CIN: U72300WB1999PTC090120) 1. The Calcutta Stock Exchange Limited (CSE) Pincon Spirit Limited, 10029247 34/1A Sudhir Chatterjee Street, 2. BSE Limited (BSE) Pincon, 538771 Kolkata- 700 006 Phones : 033-2219-4815 & 033-2219-6797 Fax : 033-2219-4815 12. Stock Market Price Data Email : [email protected] , [email protected], Month BSE Limited Calcutta Stock Exchange Limited# URL : www.skcinfo.com High Price Low Price Volume High Price Low Price Volume 15. Share Transfer System and Dematerialization of Shares Apr-15 139.60 100.60 474448 - - - The Physical share transfers are processed and the share certificates are returned to the shareholders within a maximum period of one May-15 136.00 103.00 2391737 - - - month from the date of receipt, subject to the documents being valid and complete in all respects. Jun-15 122.00 92.20 2983799 - - - Any transferee who wishes to Demat the shares may approach a Depository participant along with a duly filled Demat Request Form, Jul-15 114.70 95.00 2907712 - - - who shall, on the basis of the Share Certificate, generate a Demat request and send the same to the Registrar and Share transfer Agents Aug-15 239.00 111.00 5430022 - - - (RTA). On receipt, the Depository Registrar confirms the request. Sep-15 184.00 125.90 1878778 - - - All requests for Dematerialization of shares are processed and the confirmation is given to the respective Depositories, i.e., National Oct-15 181.80 76.00 2702020 - - - Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL), within 21 days of receipt. Nov-15 108.00 87.95 4357769 - - - Dec-15 122.70 97.80 3364620 - - - Jan-16 159.00 111.00 7554632 - - - Feb-16 135.90 100.00 1717992 - - - Mar-16 133.00 109.80 3953644 - - - # There were no transactions on Calcutta Stock Exchange Limited, during the said period. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 56 57

16. Shareholding Pattern: 17. Distribution of Shareholding as on March 31, 2016 Sl. Category of Shareholders As on March 31, 2015 As on March 31, 2016 % Change Shareholding of nominal value Share Holders Share Amount No. No. of No. of % of Total No. of No. of % of Total during the Number % of total H % of total Shareholders Shares held Shares Shareholders Shares held Shares year Upto - 5,000 6213 79.12 8325570 3.96 A Promoter and Promoter Group 5,001 -10,000 692 8.81 5535290 2.63 (1) Indian 10,001-20,000 370 4.71 5816580 2.76 (a) Individuals/Hindu undivided Family ------20,001-30,000 138 1.76 3540600 1.68 (b) Central Government/ State ------30,001-40,000 84 1.07 3033610 1.44 Government(s) 40,001-50,000 63 0.80 2951530 1.40 (c) Financial Institutions/ Banks ------50,001-100,000 130 1.66 9569150 4.55 (d) Any Other (specify) ------100,001-above 163 2.08 171657670 81.57 1&2 Sub-Total (A)(1) Total 7853 100.00 210430000 100.00 (2) Foreign Note: 1. The total number of Equity Shares has increased due to issuance of bonus share in October 2015 in the ratio 1:1 (a) Individuals (NonResident Individuals/ ------Foreign Individuals) 2. Includes Equity shares of 1000000 as of March 31, 2016 issued on preferential basis to the CMD Mr. Monoranjan Roy. (b) Government ------18. Dematerialization of Shares and Liquidity (c) Institutions ------As per notification issued by SEBI, with effect from 26th June 2000, it has become mandatory to trade in the Company’s shares in the (d) Foreign Portfolio Investor ------electronic form. The Company’s shares are available for trading in the depository systems of both the NSDL and CDSL. (e) Any Other (specify) ------Percentage of Shares held in Physical & Electronic form as on March 31, 2016 Sub-Total (A)(2) ------Total Shareholding of Nil Nil Nil Nil Nil Nil Nil Sl. No. Particulars No. of Shares % Promoter and Promoter Group (A)=(A)(1)+(A)(2) 1 Demat Mode 14940487 71.00 B Public shareholder 2 Physical Mode 6102513 29.00 (1) Institutions Grand Total 21043000 100.00 (a) Mutual Funds ------To enable us to serve our investors better, we request Members whose shares are in physical mode to dematerialize shares and to update (b) Venture Capital Funds ------their bank accounts with the respective depository participants. (c) Alternate Investment Funds ------(d) Foreign Venture Capital Investors ------19. ECS [Electronic Clearing Service] / Mandates / Bank Details (e) Foreign Portfolio Investors - - - 1 174239 0.83 0.83 Members may please note that ECS details contained in the BENPOS downloaded from the Depositories would be reckoned for payment (f) Financial Institutions/ Banks ------of dividend. In order to avoid fraudulent encashment of dividend, please register either ECS mandate or Bank details for payment of (g) Insurance Companies ------dividend. (h) Provident Funds/ Pension Funds ------(i) Any Other (specify) ------20. Disclosure with respect to demat suspense account/unclaimed suspense account Sub-Total (B)(1) - - - 1 174239 0.83 0.83 As on 31st March, 2016, there are no outstanding shares lying in the demat suspense account/unclaimed suspense account. ( 3 ) Non-institutions (a) Bodies Corporate 113 4744966 47.35 273 7131239 33.89 (13.46) 21. Address for correspondence with Depositories (b(i)) Individuals - 716 738006 7.36 7328 4968894 23.61 16.25 i. Individual shareholders holding National Securities Depository Limited Central Depository Services (India) Limited nominal share capital up to H2 lakhs. TradeWorld, 4th & 5th Floor,, Kamala Mills Compound Phiroze Jeejeebhoy Towers, (b(ii)) Individuals - 23 1498853 14.96 42 1256306 5.97 (8.99) Senapati Bapat Marg, Lower Parel 17th Floor, Dalal Street ii. Individual shareholders holding Mumbai - 400 013 Mumbai - 400 001 nominal share capital in excess of H2 lakhs. Telephone No : 022-2499 4200 Telephone No : 022-2272 3333 (c) Clearing Members 31 46245 0.46 50 330042 1.57 1.11 Facsimile Nos : 022-2497 2993/6351 Facsimile Nos : 022-2272 3199/2072 (d) NRI 4 37 0.00 158 195494 0.93 0.93 E-mail : [email protected] E-mail : [email protected] (e) Any Other (specify) : Director2 1 2993393 29.87 1 6986786 33.20 3.33 Sub-Total (B)(2) 888 10021500 100.00 7852 20868761 99.17 (0.83) Website : www.nsdl.co.in Website : www.cdslindia.com Total Public Shareholding (B)=(B)(1)+(B)(2) 888 10021500 100.00 7853 21043000 100.00 - Grand Total (A+B)1 888 10021500 100.00 7853 21043000 100.00 - 22. Outstanding GDRs/ADRs/Warrants or any Convertible instruments, conversion date and likely impact on equity. Note: 1. The total number of Equity Shares has increased due to issuance of bonus share in October 2015 in the ratio 1:1 The Company has issued 1000000 Equity Share Warrants approved by the Members at the EGM held on 22.03.2016 and allotment was 2. Includes Equity shares of 1000000 as of March 31, 2016 issued on preferential basis to the CMD Mr. Monoranjan Roy. done on 06.04.2016. The same shall be converted by 05.10.2017. Otherwise, there are no others outstanding warrants or any Convertible instruments. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 58 59

23. Dividend History (Last 10 years) Certificate under Regulation 17(8) of the SEBI Sl. No. Financial Year Dividend % Total Dividend (in H) 1 2015-16* 7.50% 15,782,250 (Listing Obligations and Disclosure Requirements) Regulations, 2015 2 2014-15 5.00% 10,021,500 3 2013-14 Nil Nil 4 2012-13 Nil Nil CERTIFICATION 5 2011-12 Nil Nil 6 2010-11 Nil Nil Pursuant to Regulation 17(8) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we hereby certify that: 7 2009-10 Nil Nil 8 2008-09 Nil Nil 1. We have reviewed Financial Statements and the Cash Flow Statement for the year and that to the best of our knowledge and belief : 9 2007-08 Nil Nil (i). these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be 10 2006-07 Nil Nil misleading; Note: * subject to the approval of the members (ii). these statements together present a true and fair view of the listed entity’s affairs and are in compliance with existing Accounting Standards, applicable laws and regulations. 24. Unclaimed Dividend Sl. No. Financial Year Dividend % Total Dividend Unclaimed Dividend Due date for 2. There are, to the best of our knowledge and belief, no transactions entered into by the listed entity during the year which are fraudulent, (in H) as on date of transfer transfer to illegal or violative of the listed entity’s code of conduct. (H) IEPF on 3. We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the 1 2014-15 5.00 % 10,021,500 995618 26.12.2022 effectiveness of internal control systems of the listed entity pertaining to financial reporting and we have disclosed to the Auditors and 2 2013-14 Nil Nil NA NA 3 2012-13 Nil Nil NA NA the Audit Committee, deficiencies in the design or operation of such internal controls, if any, of which we are aware and the steps we 4 2011-12 Nil Nil NA NA have taken or propose to take to rectify these deficiencies. 5 2010-11 Nil Nil NA NA 6 2009-10 Nil Nil NA NA 4. We have indicated to the Auditors and the Audit committee: 7 2008-09 Nil Nil NA NA (i). significant changes in internal control over financial reporting during the year; (ii). significant changes in Accounting Policies during the year and that the same have been disclosed in the notes to the Financial 25. Plant Location Statements; and IMFL Division 1. Kamarbari, Kalaberia, Bishnupur, Rajarhat, Kolkata-700 135 (iii). instances of significant fraud of which they have become aware and the involvement therein, if any, of the management or an employee having a significant role in the listed entity’s internal control system over Financial Reporting. IMIL Division 1. Mouza – Gopalpur, Chandigarh, P.S. : Barasat, Dist.: 24 Parganas (South) Sd/- Sd/- 2. M2 ADDA Industrial Estate, Kanyapur, Asansol, West Bengal Place: Kolkata Arup Thakur Monoranjan Roy FMCG Division Date: 28.04.2016 Executive Director & CFO Chairman & Managing Director 1. 81, Neelgunj Road, Agarpara, Kolkata 700 109, West Bengal (DIN: 03476120) (DIN: 02275811) 26. Address for Correspondence Mr. Aditya Karwa Company Secretary & Compliance Officer PINCON SPIRIT LIMITED DECLARATION REGARDING AFFIRMATION OF CODE OF CONDUCT Registered Office: 7, Red Cross Place, “Wellesley House” 3rd Floor, Kolkata – 700 001 I hereby confirm that the Company has obtained from all the members of the Board and Management Personnel, affirmation that they have Phone No. 033 – 2231-9135. Fax No. 033 – 4008-0690 complied with the Code of Business Conduct and Ethics for Directors/Management Personnel for the Financial Year 2015-16 E-mail: [email protected] Website: www.pinconspirit.in For and on behalf of the Board of Directors For and on behalf of the Board of Directors

Sd/- Sd/- Monoranjan Roy Monoranjan Roy Place: Kolkata, Chairman & Managing Director Place: Kolkata, Chairman & Managing Director Date: 28.04.2016 (DIN: 02275811) Date: 28.04.2016 (DIN: 02275811) nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 60 61

CORPORATE INFORMATION AUDITORS’ CERTIFICATE ON CORPORATE GOVERNANCE AS ON 31ST MARCH, 2016 CIN : L67120WB1978PLC031561

Board of Directors Corporate Office Mr. Monoranjan Roy Samskruti Chambers, No. 103, 3rd Floor, K.H.Road, Shanthi Nagar, Chairman & Managing Director Bangalore- 560027 To Mr. Arup Thakur Auditors The Members, Executive Director & CFO D.N.Misra & Co Pincon Spirit Limited Mr. Subrata Basu Chartered Accountants Executive Director We have examined the compliance of conditions of Corporate Governance by Pincon Spirit Limited, for the year ended 54, Ganesh Chandra Avenue, 1st Floor, Kolkata-700013 Mr. Jag Bahadur Singh Negi on 31st March 2016, as stipulated in Regulation 27(1) & (2) of The Securities and Exchange Board of India (Listing Director – Independent Obligation & Disclosure Requirements) Regulations, 2015 (earlier Clause 49 of the Listing Agreement) of the said Bankers Andhra Bank Company with stock exchanges. Ms. Mou Roy Director – Independent Bank Of India The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination Mr. Abhijit Datta Corporation Bank has been limited to a review of the procedures and implementation thereof adopted by the Company for ensuring Additional Director – Independent Indian Overseas Bank compliance with the conditions of the Corporate Governance as stipulated in the said Clause. It is neither an audit nor Laxmi Vilas Bank Limited an expression of opinion on the financial statements of the Company. Mr. Aditya Karwa Punjab National Bank Company Secretary State Bank Of Hyderabad In our opinion and to the best of our information and according to the explanations given to us and based on the State Bank Of Mysore representations made by the Directors and the Management, we certify that the Company has complied with the Board Committees State Bank Of Travancore conditions of Corporate Governance as stipulated in Regulation 27(1) & (2) of The Securities and Exchange Board of Audit Committee Tamilnad Mercantile Bank Limited India (Listing Obligation & Disclosure Requirements) Regulations, 2015 (earlier Clause 49 of the above-mentioned Mr. Jag Bahadur Singh Negi – Chairman Vijaya Bank Listing Agreement) Ms. Mou Roy Mr. Subrata Basu Registrar We state that such compliance is neither an assurance as to future viability of the Company nor of the efficiency or S. K. Infosolutions Pvt. Ltd effectiveness with which the management has conducted the affairs of the Company. Stakeholders Relationship Committee 34/1A, Sudhir Chatterjee Street, Kolkata- 700 006 Mr. Jag Bahadur Singh Negi – Chairman Contact No : 033-2219-4815 & 033-2219-6797 Ms. Mou Roy Fax No: 033-2219-4815 For D.N. Misra & Co. Mr. Subrata Basu Email Id : [email protected] , [email protected] Chartered Accountants Nomination & Remuneration Committee Website : www.skcinfo.com Firm Registration No. 312021E Mr. Jag Bahadur Singh Negi – Chairman Ms. Mou Roy Solicitor Mr. Subrata Basu AQUILAW Sd/- 9, Old Post Office Street, 8th Floor, Kolkata – 700 001 Corporate Social Responsibility Committee D.N. Misra Mr. Jag Bahadur Singh Negi – Chairman Place: Kolkata Proprietor Website Ms. Mou Roy www.pinconspirit.in Date: 28.04.2016 Membership No.: 050440 Mr. Subrata Basu

Registered Office 7, Red Cross Place, “Wellesley House”, 3rd Floor, Kolkata – 700 001 Phone No. 033 – 2231-9135. Fax No. 033 – 4008-0690 E-Mail: [email protected] ; [email protected] nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 62 63

Independent Auditor’s Report

To The Members, Pincon Spirit Limited

Report on the inancial Statements accordance with the Standards on Auditing specified under Section Report On Other Legal And Regulatory Requirements f) With respect to the other matters to be included in We have audited the accompanying Financial Statements of Pincon 143(10) of the Act. Those Standards require that we comply with 1. As required by ‘The Companies (Auditor’s Report) Order, 2015’, the Auditor’s Report in accordance with Rule 11 of the Spirit Limited (“the Company”), which comprise the Balance Sheet ethical requirements and plan and perform the Audit to obtain issued by the Central Government of India in terms of Sub- Companies (Audit and Auditors) Rules, 2014, in our as at 31st March, 2016, the Profit and Loss Statement, the Cash Flow reasonable assurance about whether the Financial Statements are section (11) of Section 143 of the Act (hereinafter referred to opinion and to the best of our information and according Statement for the year ended 31st March, 2016 and a summary of free from material misstatements. as the “Order”), and on the basis of such checks of the books to the explanations given to us: significant Accounting Policies and other explanatory information. and records of the Company as we considered appropriate and An Audit involves performing procedures to obtain Audit evidence (i) The Company has disclosed the impact of pending according to the information and explanations given to us, we Management’s Responsibility for the inancial Statements about the amounts and disclosures in the Financial Statements. The litigations on its Financial position in its Financial give in the Annexure a statement on the matters specified in The Company’s Board of Directors is responsible for the matters procedures selected depend on the Auditors’ judgment, including Statements as referred to in the Note to the Financial paragraphs 3 and 4 of the Order. stated in Section 134(5) of the Companies Act, 2013 (“the Act”) the assessment of the risks of material misstatement of the Financial Statements. with respect to the preparation of these Standalone Financial Statements, whether due to fraud or error. In making those risk 2. As required by Section 143(3) of the Act, we report that: (ii) The Company has made provision, as required under Statements that give a true and fair view of the financial position, assessments, the auditor considers internal financial control a) We have sought and obtained all the information and the applicable law or Accounting Standards, for financial performance and cash flows of the Company in relevant to the Company’s preparation of the Financial Statements explanations which to the best of our knowledge and material foreseeable losses, if any, and as required on accordance with the Accounting Principles generally accepted in that give a true and fair view in order to design Audit procedures belief were necessary for the purposes of our audit; long-term contracts including derivative contracts. India including the Accounting Standards specified under Section that are appropriate in the circumstances, but not for the purpose b) In our opinion, proper books of account as required by law (iii) There has been no delay in transferring amounts, 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, of expressing an opinion on whether the Company has in place an have been kept by the Company so far as it appears from required to be transferred, to the Investor Education 2014. This responsibility also includes maintenance of adequate adequate internal financial controls system over Financial Reporting our examination of those books. and Protection Fund by the Company. accounting records in accordance with the provisions of the Act and the operating effectiveness of such controls. An Audit also c) The Balance Sheet, the Profit and Loss Statement, and for safeguarding the assets of the Company and for preventing and includes evaluating the appropriateness of accounting policies used the Cash Flow Statement dealt with by this Report are in detecting frauds and other irregularities; selection and application of and the reasonableness of the accounting estimates made by the agreement with the books of account. appropriate accounting policies; making judgments and estimates Company’s Directors, as well as evaluating the overall presentation that are reasonable and prudent; and design, implementation and of the Financial Statements. d) In our opinion, the aforesaid Standalone Financial maintenance of adequate internal financial controls, that were Statements comply with the Accounting Standards or .. Misra Co. We believe that the Audit evidence we have obtained is sufficient operating effectively for ensuring the accuracy and completeness of specified under Section 133 of the Act, read with Rule 7 of Chartered Accountants and appropriate to provide a basis for our Audit opinion on the the accounting records, relevant to the preparation and presentation the Companies (Accounts) Rules, 2014; Firm Registration No. 312021E Standalone Financial Statements. of the Financial Statements that give a true and fair view and are free e) On the basis of the written representations received from Opinion from material misstatement, whether due to fraud or error. the Directors as on March 31, 2016, taken on record by the Sd/- In our opinion and to the best of our information and according Board of Directors, none of the directors is disqualified as Auditor’s Responsibility .. Misra to the explanations given to us, the aforesaid Financial Statements on March 31, 2016, from being appointed as a Director in Our responsibility is to express an opinion on these Standalone Place: Kolkata Proprietor give the information required by the Act in the manner so required terms of Section 164 (2) of the Act. Financial Statements based on our Audit. Date: 28.04.2016 Membership No.:050440 and give a true and fair view in conformity with the accounting We have taken into account the provisions of the Act, the principles generally accepted in India, of the state of affairs of the Accounting and Auditing Standards and matters which are required Company as at March 31, 2016, and its profit and its cash flows for to be included in the Audit Report under the provisions of the the year ended on that date. Act and the Rules made there under. We conducted our Audit in nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 64 65

Annexure to Independent Auditors’ Report

Referred to in paragraph 1 of the Independent Auditors’ Report of even date to the members of Pincon Spirit Limited on the Financial Statements as of and for the year ended March 31, 2016.

1. (a) The Company has maintained proper records showing full 5. In our opinion and according to the information and (d) According to the information and explanation given 12. Based upon the audit procedures performed for the purpose particulars, including quantitative details and situation of explanations given to us, the Company has not accepted any to us and records of the Company examined by us, the of reporting the true and fair view of the Financial Statements fixed assets; deposits within the meaning of provisions of sections of 73 to Company is not required to transfer amount to investor and as per the information and explanations given by the 76 or any other relevant provisions of the Companies Act, 2013 education and protection fund in accordance with the management, we report that no fraud on or by the Company (b) The substantial portion of fixed assets have been physically and the rules framed there under. In our opinion and according provisions of the Companies Act, 2013 and the rules made has been noticed or reported during the year. verified by the management at reasonable intervals to the information and explanations given to us, no order thereunder. having regard to the size of the Company and the nature has been passed by the Company Law Board or the National of assets. No material discrepancies were noticed on such 8. The Company has no accumulated losses at the end of the Company Law Tribunal or the Reserve Bank of India or any physical verification. financial year and it has not incurred cash losses in the current other Tribunal against the Company. and immediately preceding financial year. 2. (a) The inventory (excluding stocks with third parties) has 6. We have broadly reviewed the books of account relating been physically verified by the Management during 9. In our opinion and according to the information and to materials, labor and other items of cost maintained by the year. In respect of inventory lying with third parties, explanations given by the management, we are of the opinion the Company pursuant to the Rules made by the Central or .. Misra Co. these have substantially been confirmed by them. In our that the Company has not defaulted in repayment of dues to a Government for the maintenance of cost records under section Chartered Accountants opinion, the frequency of verification is reasonable. financial institution, bank or debenture holders. 148 (1) of the Companies Act, 2013 and are of the opinion that, Firm Registration No. 312021E (b) The procedures of physical verification of inventories prima facie, the prescribed accounts and record have been 10. The Company has not given any guarantee for loans taken by followed by the Management are reasonable and made and maintained. others from bank or financial institutions. Sd/- adequate in relation to the size of the Company and the 7. (a) According to the records of the Company, the Company 11. In our opinion, and according to the information and .. Misra nature of its business. is regular in depositing with appropriate authorities explanations given to us, the term loans have been applied, on Place: Kolkata Proprietor (c) In our opinion and according to the information and undisputed statutory dues including Provident Fund, an overall basis, for the purposes for which they were obtained. Date: 28.04.2016 Membership No.:050440 explanations given to us, the Company is maintaining Investor Education Protection Fund, Employees State proper records of inventory. The discrepancies noticed Insurance, Income Tax, Sales Tax, Wealth Tax, Custom Duty, on verification between the physical stocks and the book Excise Duty, Service Tax, Value Added Tax , Cess and other records were not material and have been properly dealt material statutory dues applicable to it. with in the books of account. (b) According to the information and explanations given to 3. (a) The Company has not granted any loan during the year. us, no undisputed amount payable in respect of Income (b) There is no overdue amount of loans granted to Tax, Wealth Tax, Sales Tax, Customs Duty and Excise Duty, companies, firms and other parties covered in the register Service Tax, Value Added Tax, Cess etc. were outstanding as maintained under section 189 of the Companies Act, 2013 at 31st March, 2016 for a period of more than six months from the date they became payable. 4. In our opinion and according to the information and explanations given to us, there are adequate internal control (c) According to the records of the Company, no dues procedures commensurate with the size of the Company and outstanding of Sales Tax, Income Tax, Customs Duty, the nature of its business with regard to purchases of inventory, Wealth Tax, Excise Duty, Service Tax, Value Added Tax, and fixed assets and with regard to the sale of goods and services. Cess on account of any dispute. During the course of our audit, no major weakness has been noticed in the internal controls system. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 66 67

Audited Standalone alance Sheet as at 31.03.2016 Audited Standalone Statement of Profit and Loss Accountfor the year ended 31.03.2016 (In H) (In H) Particulars ote o. As at As at Particulars ote o. or the year ended or the year ended 31.03.2016 31.03.2015 31.03.2016 31.03.2015 IT A LIAILITIS ICOM Shareholder’s unds Revenue from Operations 18 9,460,588,193 6,025,557,392 Share Capital 2 210,430,000 100,215,000 Other Incomes 19 - 1,409,333 Reserves and Surplus 3 694,814,237 446,383,596 Total Revenue I 460513 60266625 on-Current Liabilities PSS Long Term Borrowings 4 620,409,047 603,767,335 Cost of Materials Consumed 20 3,300,247,529 1,343,496,828 Current Liabilities Purchases 21 5,839,765,750 4,380,881,518 Short-Term Borrowings 5 1,916,797,165 917,021,333 Change In Inventories (Increase)/Decrease 22 (566,330,719) (262,535,234) Trade Payables 6 27,560,931 13,376,124 Other Manufacturing Expenses 23 149,503,009 109,372,132 Other Current Liabilities 7 133,429,505 25,919,345 Employee Benefit Expenses 24 26,040,000 21,700,000 Short-Term Provisions 8 346,609,430 205,599,790 Administrative & General Expenses 25 35,608,380 25,341,083 TOTAL 350050315 231222523 Selling & Distribution Expenses 26 114,092,292 80,121,563 ASSTS Finance Costs 27 166,927,698 70,672,884 on-Current Assets Depreciation and Amortization Expenses 9 20,739,970 21,514,463 Fixed Assets Miscellaneous Expenses 28 620,824 - Tangible Assets 9 177,449,993 178,047,751 Total xpenses II 021433 5056523 Capital Working in Progress 40,116,135 - Profit before Tax I - IIIII 3333460 2364014 Non-Current Investments 10 155,236,250 155,236,250 Long-Term Loans and Advances 11 190,814,560 - Tax xpense: Deferred Tax Assets (Net) 12 3,439,204 1,306,873 1) Current tax 126,909,640 80,352,870 Miscellaneous Expenditure 13 3,104,122 - 2) Deferred Tax Liability/(Assets) (2,132,331) (751,868) Current Assets Profit Loss for the Period III-I-I 2456151 1560046 Inventories 14 1,902,463,098 695,659,579 arnings per equity share of face value of H10 each Trade Receivables 15 1,075,108,319 1,056,681,086 1) Basic 29 11.81 15.65 Cash and Cash Equivalents 16 3,717,789 1,370,646 2) Diluted 29 16.87 15.65 Other Current Assets 17 398,600,845 223,980,338 SIGNIFICANT ACCOUNTING POLICIES 1 TOTAL 350050315 231222523 The accompanying notes form an integral part of the Standalone Financial Statements Significant Accounting Policies 1 As per our report of even date attached or and on behalf of the oard The accompanying notes form an integral part of the Standalone Financial Statements Sd/- As per our report of even date attached or and on behalf of the oard or .. Misra Co. Monoranan Roy Sd/- Chartered Accountants Chairman & Managing Director or .. Misra Co. Monoranan Roy Firm Registration No. 312021E (DIN: 02275811) Chartered Accountants Chairman & Managing Director Firm Registration No. 312021E (DIN: 02275811) Sd/- Sd/- Sd/- .. Misra Arup Thakur Aditya arwa Sd/- Sd/- Sd/- Proprietor Executive Director & CFO Company Secretary .. Misra Arup Thakur Aditya arwa Membership No.:050440 (DIN: 03476120) Proprietor Executive Director & CFO Company Secretary Membership No.:050440 (DIN: 03476120) Place: Kolkata Date: 28.04.2016 Place: Kolkata Date: 28.04.2016 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 68 69

Cash low Statement for the year ended 31.03.2016 otes forming part of the Audited Standalone inancial Statements (In H) Particulars or the year ended or the year ended OT 1 31.03.2016 31.03.2015 A. CORPORAT IORMATIO A. CASH LO ROM OPRATI ACTIITIS: Pincon Spirit Limited (referred to as “PSL” or “the Company”) (CIN No: L67120WB1978PLC031561) is a Public Company domiciled in India et Profit before tax 3333460 2364014 and Incorporated under the provisions of the Companies Act, 1956. Its shares are listed on The Calcutta Stock Exchange Limited & BSE Adustments for: Limited in India. The Company is engaged in carrying on the Business of Blending, Bottling & Wholesale Distribution of Indian Made Depreciation & Amortization Expenses 20,739,970 21,514,463 Foreign Liquor (“IMFL”), Indian Made Indian Liquor (“IMIL”) & Refining, Packaging, & Wholesale Distribution of Fast Moving Consumer Interest Paid 166,927,698 70,672,884 Goods (“FMCG”) Miscellaneous Expenses 620,824 - . SIIICAT ACCOTI POLICIS Operating Profit before orking capital changes 56166152 32535 Adustments for: a. asis of Preparation of the inancial Statements (Increase) / Decrease in Inventories (1,206,803,519) (482,101,809) The Financial Statements have been prepared in compliance with the Generally Accepted Accounting Principles in India (“Indian (Increase)/ Decrease in Account Receivable (18,427,233) (801,704,539) GAAP”) and the Accounting Standards notified under relevant provisions of the Companies Act, 2013. (Increase)/ Decrease in Loans & Advances (174,620,507) 168,694,092 These Financial Statements have been prepared on accrual basis under historical cost convention and are presented in Indian Increase/ (Decrease) in Account Payables 262,704,607 106,083,971 Rupees, rounded off to the nearest Rupee. Cash enerated from Operations 554400 6043450 b. se of stimates Income Tax paid (Net of Refund) (126,909,640) (80,352,870) The preparation of the Financial Statements in conformity with the Indian GAAP requires Management of the Company to make et Cash from Operating Activities 4455060 6000650 estimates, judgments and assumptions to be made that affect the reported amount of assets and liabilities, disclosure of contingent . CASH LO ROM ISTI ACTIITIS: liabilities as on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Tangible Assets (20,142,212) - Any difference between the actual results and estimates are recognised in the period in which the results are known / materialised. Capital Working in Progress (40,116,135) 24,308,964 Non-Current Investments - (85,000,000) c. ixed Assets Long-Term Loans and Advances (190,814,560) - i. Tangible Assets Miscellaneous Expenses (3,724,946) - Tangible Assets are stated at cost, net of taxes, discounts plus revaluations, if any, less accumulated depreciation & impairment et Cash from Investing Activities 25453 6061036 loss, if any. C. CASH LO ROM IACI ACTIITIS: The Cost includes the purchase price plus other attributable costs for bringing the assets to its working condition for intended Proceeds of Equity Share 135,000,000 - use. Proceeds of Unsecured Loans 17,500,000 299,365,968 Any subsequent expenditure relating to the Tangible Assets which increase the future benefits are added to the book value of Proceeds of Secured Loans 998,917,544 596,314,763 the tangible assets. Interest Paid (166,927,698) (70,672,884) Expenditure relating Tangible Assets that are not ready for their intended use are disclosed under Capital Work-in-Progress. Dividends paid (including corporate dividend tax) (24,950,510) (6,012,599) ii. Intangible Assets et Cash from inancing Activities 553336 1524 Initial recognition of Intangible Assets are at cost less accumulated amortisation and accumulated impairment loss, if any. Net Increase/(Decrease) in Cash and Cash equivalents 234144 2410 Internally generated Intangible Assets, excluding capitalised development costs, are not capitalised and expenditure is Cash and Cash equivalents as at 1st April(Opening Balance) 1,370,646 3,858,755 reflected in the Statement of Profit & Loss for the year in which the expenditure is incurred. Amortisation of Intangible Assets Cash and Cash equivalents as at 31st March(Closing Balance) 3,717,789 1,370,646 are done on a straight-line basis over the estimated useful economic life. As per our report of even date attached or and on behalf of the oard d. Leases Sd/- Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating or .. Misra Co. Monoranan Roy leases. Payments made under operating leases are charged to the Statement of Profit and Loss on a straight-line basis over the Chartered Accountants Chairman & Managing Director period of lease. Firm Registration No. 312021E (DIN: 02275811) e. epreciation Amortisation In Tangible Fixed Assets (other than freehold land & capital work-in-progress), acquired during the year, depreciation / amortisation Sd/- Sd/- Sd/- is charged on Written Down Method so as to write off the cost of the Assets over the useful lives and in regard to the Tangible Assets .. Misra Arup Thakur Aditya arwa acquired prior to April 1, 2014, the carrying amount as on April 1, 2014 is depreciated over the remaining useful life as prescribed in Proprietor Executive Director & CFO Company Secretary Schedule II of the Companies Act, 2013. Membership No.:050440 (DIN: 03476120)

Place: Kolkata Date: 28.04.2016 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 70 71

otes forming part of the Audited Standalone inancial Statements otes forming part of the Audited Standalone inancial Statements

f. Impairment q. arnings per Share PS In case an asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged Basic EPS is arrived at based on Net Profit after Taxation available to equity shareholders to the weighted average number of equity to the Profit and Loss Statement in the year in which an asset is identified as impaired. The impairment loss recognised in prior shares outstanding during the year. The Diluted EPS is calculated on the same basis as Basic EPS, after adjusting for the effects of accounting period is reversed if there has been a change in the estimate of recoverable amount. potential dilutive equity shares unless impact is anti-dilutive.

g. Investments r. Provisions Current investments are carried at lower of cost and quoted/fair value, computed category-wise. Non-Current investments are stated A provision is recognised when an enterprise has a present obligation as a result of a past event and it is probable that an outflow at cost. Provision for diminution in the value of Non-Current investments is made only if such a decline is other than temporary. of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions, other than employee benefits, are not discounted to their present value and are determined based on management estimate required to h. Inventories settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence, if any. Cost of inventories management estimates. comprises of cost of purchase, cost of conversion and other costs including manufacturing overheads incurred in bringing them to their respective present location and condition. s. Contingent LiabilitiesAssets No provision is made for liabilities which are contingent in nature. Provision is made for those contingencies which are likely to i. mployee enefits materialize into liabilities after the year end till the date of finalization of accounts and have material effect on the position stated in There is no employee who is in receipt of remuneration in excess of the limits specified. the Balance Sheet. . Revenue Recognition Contingent liabilities are not recognised but disclosure of its existence is done in the Financial Statements. A contingent asset is Revenue is recognised only when risks and rewards incidental to ownership are transferred to the customer, it can be reliably neither recognised nor disclosed in the Financial Statements. measured and it is reasonable to expect ultimate collection. Revenue from operations includes sale of goods, tax, excise duty, adjusted for discounts (net). Dividend income, if any, is recognised when right to receive payment is established. Interest income is recognised on a time proportion basis taking into account the amount outstanding and the interest rate applicable.

k. orrowing Costs Borrowing costs consist of interest and other ancillary costs than an entity incurs in connection with borrowing of funds, Ancillary costs incurred in connection with the arrangement of borrowings are amortized over the tenure of borrowing.

l. oreign Currency Transactions The Company has foreign currency transactions during the period under review.

m. Cash and Cash quivalents Cash and Cash Equivalents include cash in hand, demand deposits with banks, other short-term highly liquid investments with original maturities of three months or less.

n. Conservation of nergy Technology absorption In view of the activities of the Company, the matters related to conservation of Energy & Technology are not applicable to the Company.

o. ue to Micro Small Industrial nterprises The Company has not received any information from any of the suppliers of their being a micro/ small scale industrial enterprise, hence the amount due to such units outstanding as at the year ended 31.03.2016 is not ascertainable.

p. Income Tax Provision is made for Income Tax on a yearly basis under the tax payable method based on tax liability as computed after taking credit for allowances, expenses. In case of matters under appeal due to disallowance or otherwise, full provision is made when the liabilities are accepted. Deferred Tax is recognized on timing differences between taxable income and accounting income subject to a consideration of prudence. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 72 73

otes forming part of the Audited Standalone inancial Statements otes forming part of the Audited Standalone inancial Statements

(In H) (In H) Particulars As at As at Particulars As at As at 31.03.2016 31.03.2015 31.03.2016 31.03.2015 otes 2 Share Capital otes 3 Reserves and Surplus Authorised Capital a Securities Premium 50,000,000 Equity Shares of H10/- each 500,000,000 100,300,000 As per last Balance Sheet 636,405 636,405 Addition during the year 125,000,000 - (Previous Year : 10,030,000 Equity Shares of H10/- each) a 125636405 636405 500000000 100300000 b Surplus in the Statement of Profit Loss Issued Subscribed and Paid up Opening Balance 445,747,191 294,959,304 21,043,000 Equity Shares of H10/- each 210,430,000 100,215,000 Add: Profit for the Year 248,596,151 156,800,486 (Previous Year : 10,021,500 Equity Shares of H10/- each) 64343342 45150 210430000 100215000 Less: Appropriations (a) Proposed final Dividend on Equity Shares* 15,782,250 5,010,750 a Reconciliation of number of Shares Capital (b) Tax on Dividend 3,155,661 1,001,849 (c) Conversion into Equity due to Issue of Bonus Share 100,215,000 - quity Shares As at 31.03.2016 As at 31.03.2015 (d) Prior Period Dividend (F.Y: 2014-15) 5,010,750 - o. Amount H o. Amount H (e) Prior Tax on Dividend (F.Y: 2014-15) 1,001,849 - Opening Balance 10,021,500 100,215,000 10,021,500 100,215,000 b 56132 445411 Add: Bonus Share Issue 10,021,500 100,215,000 - - (a+b) 641423 4463356 Add: Preferential Allotment 1,000,000 10,000,000 - - * The Board of Directors have recommended final dividend for the F.Y: 2015-16 of H0.75 Per Equity Share subject to approval in the forthcoming Closing alance 21043000 210430000 10021500 100215000 AGM.

otes 4 Long-Term orrowings b Rights and restriction attached to Shares Capital Secured Loan - Car Loan 2,909,047 3,767,335 The Company has one class of equity shares having a par value of H10 each. Each shareholder is eligible for one vote per share held. Unsecured Loan - Director 617,500,000 600,000,000 The Company has declared dividend of H0.75 (i.e. 7.50%) per share during the current year and in previous year dividend was of H0.50 6204004 6036335 (i.e.5.00%) per share. Car Loan is from Punjab National Bank, the car being the primary security. c Share held by holdingultimate holding company andor their subsidiariesassociates : otes 5 Short-Term orrowings There is no such Share held by holding/ultimate holding company and/or their subsidiaries/associates. Cash Credit Facilities (Secured) 1,916,797,165 917,021,333 116165 1021333 d Shares allotted as fully paid up by way of bonus shares during 5 years preceding March 31 2016 Working Capital Loan has been availed under Consortium Banking arrangement from State Bank of Mysore, (Leader of Consortium) & other During the last 5 years preceding to March 31, 2016, the Company has allotted as fully paid up Bonus share in the ratio of 1:1 on member banks being State Bank of Hyderabad, State Bank of Travancore, Bank of India, Andhra Bank, Punjab National Bank, Laxmi Vilas Bank 12.10.2015 as approved by Members in the EGM held on 29.09.2015. Limited, Tamilnad Mercantile Bank Limited, Corporation Bank, Vijaya Bank, Indian Overseas Bank with sharing of pari passu charge by way of hypothecation of present & future Currents Assets of the Company, consisting of Stock & Book Debts. e etails of shares held by shareholders holding more than 5% of the aggregate shares in the Company quity Shares As at 31.03.2016 As at 31.03.2015 otes 6 Trade Payables o. Amount H o. Amount H Trade Payables 27,560,931 13,376,124 Monoranjan Roy: 33.20% (P.Y:29.87%) 6,986,786 69,867,860 2,993,393 29,933,930 256031 1336124 Anushri Textile Private Limited: 0.17% (P.Y: 10.89%) 34,920 349,200 1,090,998 10,909,980 otes Other Current Liabilities 666 6660 40431 404310 Other Payables 133,429,505 25,919,345 13342505 251345

otes Short-Term Provisions For Income Tax & others 346,609,430 205,599,790 34660430 20550 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 74 75

otes forming part of the Audited Standalone inancial Statements As at at As 561,005 4,946,891 6,040,161 1,021,310 6,500,000 6,500,000 5,215,422 3,865,149 13,112,829 17,693,739 89,842,374 89,070,776 73,249,208 59,991,101 (In H) 1562214 10451

March 31 2015 March 31 2014 March Particulars As at As at 31.03.2016 31.03.2015 et lock et lock As at at As otes 10 on-Current Investments 308,160 476,284 4,051,503 4,348,308 9,717,917 6,500,000 3,585,956 2,864,461 12,871,286 85,523,368 84,733,029 64,742,549 49,132,711 26,642,212 In quity Shares of Subsidiary Companies - 10451 1443

March 31 2016 March 31 2015 March Paul Distributors Private Limited 55,000,000 55,000,000 - - Priya Laboratories Private Limited 15,236,250 15,236,250

As at at As Yours Laboratories Private Limited 85,000,000 85,000,000 3,651,359 3,354,554 1,787,519 1,619,395 1,629,466 2,350,961 14,191,692 11,038,323 11,526,458 12,316,797 26,683,143 42,292,981 155236250 155236250 555133 65130 March 31 2016 March 31 2015 March ------otes 11 Long-Term Loans and Advances Business Advance for Acquisitions 190,814,560 - 1014560 - eductions eductions - - otes 12 eferred Tax Assets year year Deferred Tax Assets 3,439,204 1,306,873 or the or the or 895,388 252,845 545,026 epreciation lock epreciation lock epreciation 1,691,853 3,394,912 4,822,453 4,319,006 4,337,747 8,506,659 1,629,466 1,000,688 10,858,390 21514463 2030 343204 13063 - - - otes 13 Miscellaneous xpenditure

As at at As Opening Balance - - 2,755,971 1,662,701 6,215,870 1,534,674 1,074,369 7,207,452 7,979,050 1,350,273 10,796,780 18,176,484 31,434,591 343366 555133 Incurred during the year 3,724,946 - April 1 2015 April 1 2014 Less: Written off during the year 620,824 - 3104122 - As at at As 7,702,862 7,702,862 2,095,679 2,095,679 6,500,000 5,215,422 5,215,422 23,909,609 23,909,609 97,049,826 97,049,826 91,425,692 91,425,692 26,642,212 otes 14 Inventories 23300 254041302

March 31 2016 March 31 2015 March Raw Materials 512,925,690 156,975,356 ------Finished Goods 1,389,537,408 538,684,223 year year 1024630 65655 during the during the eductions eductions otes 15 Trade Receivables ------Secured, Considered Good ross lock ross lock ross

during during - Outstanding for a period exceeding six months - - the year the year Additions Additions 20,142,212 20142212 - Others 1,014,880,805 996,453,572 - Export Receivable (above six month) 60,227,514 60,227,514 1051031 10566106 As at at As 7,702,862 7,702,862 2,095,679 2,095,679 6,500,000 6,500,000 5,215,422 5,215,422 23,909,609 23,909,609 97,049,826 97,049,826 91,425,692 91,425,692 23300 23300

April 1 2015 April 1 2014 otes 16 Cash and Cash quivalents Cash in Hand & at Bank 3,717,789 1,370,646 31 130646

otes 1 Other Current Assets Sundry Current Assets 398,600,845 223,980,338 360045 223033 otes forming part of the Audited Standalone inancial Statements part inancial Standalone forming otes of the Audited Assets ixed otes as on 31.03.2016 Assets Tangible Particulars ear Previous as on 31.03.2015 Assets Tangible Particulars Electrical Equipment Electrical Equipment Furniture & Fixtures Furniture & Fixtures Furniture Office Equipment Office Equipment Building Building Plant & machineryPlant Plant & machineryPlant Land Land Motor Vehicle Motor Vehicle TOTAL TOTAL nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 76 77

otes forming part of the Audited Standalone inancial Statements otes forming part of the Audited Standalone inancial Statements

(In H) (In H) Particulars or the year ended or the year ended Particulars or the year ended or the year ended 31.03.2016 31.03.2015 31.03.2016 31.03.2015 otes 1 Revenue rom Operations otes 22 Change in Inventories In quity Shares of Subsidiary Companies - IML Own Blend (IMFL) 2,549,897,706 1,548,523,113 Opening Stock of Finished Goods 225,939,757 95,775,769 Own Blend (IMIL) 1,227,494,005 - Closing Stock of Finished Goods 501,988,517 225,939,757 Traded - IMFL 2,873,214,281 2,660,260,974 (A) 260460 130163 FMCG EXPORT 996,798 60,227,514 MC FMCG - Domestic 2,808,985,403 1,756,545,791 Opening Stock of Finished Goods 164,255,904 31,884,658 460513 60255532 Closing Stock of Finished Goods 454,537,863 164,255,904 (B) 20215 13231246 otes 1 Other Incomes Total (A+B) 5663301 262535234 Interest Income - 1,409,333 - 140333 otes 23 Other Manufacturing xpenses Sundry Manufacturing Expenses 149,503,009 109,372,132 otes 20 Cost of Materials Consumed 1450300 1032132 COST O RA MATRIALS COSM IML

Opening Stock of Raw Materials 156,975,356 21,473,958 otes 24 mployee enefit xpenses Add: Purchase 2,535,680,325 1,563,063,402 Salaries and Wages 26,040,000 21,700,000 Closing Stock of Raw Materials 331,820,385 156,975,356 26040000 2100000 COST O RA MATRIALS COSM IML 23603526 142562004 Opening Stock of Finished Goods 148,488,562 64,423,386 otes 25 Administrative eneral xpenses COST O RA MATRIALS COSM 2,360,835,296 1,427,562,004 Postage & Telephone 2,063,871 1,623,034 Closing Stock of Finished Goods 282,547,512 148,488,562 Directors Remuneration 7,440,000 6,730,000 (A) 22266346 1343462 Legal Expenses 2,611,162 1,946,637 COST O RA MATRIALS COSM IMIL Organisational Expenses 13,962,440 7,883,076 Opening Stock of Raw Materials - - Printing & Stationery 1,942,915 1,428,619 Add: Purchase 1,405,040,004 - Rent 1,080,000 1,080,000 Closing Stock of Raw Materials 181,105,305 - Travelling & Conveyance 6,439,292 4,616,009 COST O RA MATRIALS COSM IMIL 1223346 - Auditors' Fees 68,700 33,708 Opening Stock of Finished Goods - - 356030 2534103 COST OF RAW MATERIALS CONSUMED 1,223,934,699 - Closing Stock of Finished Goods 150,463,516 - (B) 1034113 - otes 26 Selling and istribution xpenses Total Cost of Materials Consumed (A+B) 33002452 1343462 Business Promotion/Advertisement 52,621,751 46,001,563 Carriage Outwards 10,635,350 10,576,205 Discount & Rebate 6,166,087 2,362,956 otes 21 Purchases Godown Expenses 4,295,187 3,745,703 Purchase of IMFL – Trade 2,989,412,849 2,617,774,241 Godown Rent 600,000 600,000 Purchase of FMCG 2,850,352,901 1,763,107,277 Rebate on Sales 39,773,917 16,835,136 536550 430151 1140222 0121563 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 78 79

otes forming part of the Audited Standalone inancial Statements otes forming part of the Audited Standalone inancial Statements

(In H) otes 30 Related Party isclosures (contd.) Particulars or the year ended or the year ended c Aggregate Related Parties isclosures: 31.03.2016 31.03.2015 (In H) otes 2 inance Costs Subsidiary Companies 2015-16 2014-15 Finance Expense 166,927,698 70,672,884 Loan Advances Outstanding 16626 0624 Paul Distributors Private Limited - - Priya Laboratories Private Limited - - otes 2 Miscellaneous xpenses ey Management Personnel Written off during the Year 620,824 - Remuneration 6,600,000 6,600,000 62024 - nsecured Loan Taken during the year Mr. Monoranjan Roy 152,500,000 300,000,000 nsecured Loan Taken Outstanding at the end of the ear (In H) Mr. Monoranjan Roy 617,500,000 600,000,000 Particulars 2015-16 2014-15 Preferential Allotment of Share Capital otes 2 asis for calculation of asic and iluted arnings per Share is as under: Mr. Monoranjan Roy (Conversion of Unsecured Loan) 600,000,000 - Profit after Tax as per Profit & Loss Account 248,596,151 156,800,486 Number of Equity Share at the end of year 21,043,000 10,021,500 Weighted average number of Equity Shares 14,736,522 10,021,500 (In H) Basic Earnings per share 11.81 15.65 Particulars ear nded Diluted Earnings per share 16.87 15.65 Audited Nominal Value of Shares 10.00 10.00 31-Mar-16 31-Mar-15 otes 31 Standalone Audited Segment-ise Revenue Results and Capital mployed otes 30 Related Party isclosures 1. Segment Revenue a ame of the related parties where control exists: a) IMFL & IMIL 6,650,605,992 4,208,784,088 Subsidiary Companies Paul Distributors Private Limited (with effect from 21st March 2014) b) FMCG 2,809,982,201 1,816,773,305 Priya Laboratories Private Limited (with effect from 21st March 2014) Yours Laboratories Private Limited (With effect from 03rd July2014) ross Income from Operations 460513 60255532 2. Segment Results b ame of the Other Related Parties a) IMFL & IMIL 406,021,119 210,843,027 ey Managerial Personnel Mr. Monoranjan Roy (Chairman & Managing Director) b) FMCG 134,280,039 94,822,012 Mr. Arup Thakur (Executive Director & CFO) Total 54030115 30566503 Mr. Subrata Basu (Executive Director) Less: Other un-allocable expenditure c Aggregate Related Parties isclosures: a) Interest 166,927,698 70,672,884 (In H) Add: a) Other un-allocable income - 1,409,333 Subsidiary Companies 2015-16 2014-15 Profit efore Tax 3333460 2364014 Sales Tax Expenses 124,777,309 79,601,002 Paul Distributors Private Limited - - Profit After Tax 2456151 1560046 PurchaseOther Manufacturing xpenses 3. Capital mployed Priya Laboratories Private Limited 32,359,995 21,331,000 a) IMFL & IMIL 958,776,185 694,174,057 Yours Laboratories Private Limited 32,271,375 - b) FMCG 405,097,523 299,648,751 Loan Advances nsecured Loan iven Recovered during the year Total Segment Capital mployed 136330 3220 Paul Distributors Private Limited - (25,000,000) Priya Laboratories Private Limited - (16,000,000) nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 80 81

Independent Auditor’s Report

To The Members, Pincon Spirit Limited

We have Audited the accompanying Consolidated Financial Accounting Policies used and the reasonableness of the accounting Statements of Ms Pincon Spirit Limited (“the Company”) and its estimates made by management, as well as evaluating the overall Subsidiaries, which comprise the Consolidated Balance Sheet as presentation of the consolidated financial statements. We believe at March 31, 2016, the Consolidated Statement of Profit and Loss that the Audit evidence we have obtained is sufficient and Account and the Consolidated Cash Flow Statement for the year appropriate to provide a basis for our Audit opinion. ended March 31, 2016, and a summary of significant Accounting Opinion Policies and other explanatory information. In our opinion and to the best of our information and according to Management’s Responsibility for the Consolidated inancial the explanations given to us, the Consolidated Financial Statements Statements give a true and fair view in conformity with the Accounting Principles Management is responsible for the preparation of these generally accepted in India: Consolidated Financial Statements that give a true and fair view a) In the case of the Consolidated Balance Sheet, of the state of of the Consolidated Financial position, Consolidated Financial affairs of the Company as at March 31, 2016; performance and Consolidated Cash Flows of the Company in b) In the case of the Consolidated Statement of Profit and Loss, of accordance with accounting principles generally accepted in the Profit for year ended on that date; and India. This responsibility includes the design, implementation and Consolidated maintenance of internal control relevant to the preparation and c) In the case of the Consolidated Cash Flow Statement, of the inancial Statements presentation of the Consolidated Financial Statements that give a Cash Flows for the year ended on that date. true and fair view and are free from material misstatement, whether Other Matter due to fraud or error. We did not Audit total assets of H22.88 Crore as at March 31, 2016, Auditor’s Responsibility total revenues of H41.89 Crore and Net Cash Inflows amounting Our responsibility is to express an opinion on these Consolidated to H93.84 Lacs for the year ended, included in the accompanying Financial Statements based on our Audit. We conducted our Audit Consolidated Financial Statements in respect of Subsidiaries, in accordance with the Standards on Auditing issued by the Institute whose Financial Statements and other Financial Information have of Chartered Accountants of India. Those Standards require that we been Audited by other Auditors and whose reports have been comply with ethical requirements and plan and perform the Audit furnished to us. Our opinion, in so far as it relates to the affairs of to obtain reasonable assurance about whether the Consolidated such Subsidiaries is based solely on the report of other Auditors. Our Financial Statements are free from material misstatement. opinion is not qualified in respect of this matter.

An Audit involves performing procedures to obtain Audit evidence about the amounts and disclosures in the Consolidated Financial Statements. The procedures selected depend on the Auditor’s judgment, including the assessment of the risks of material or .. Misra Co. misstatement of the Consolidated Financial Statements, whether Chartered Accountants due to fraud or error. In making those risk assessments, the Auditor Firm Registration No. 312021E considers internal control relevant to the Company’s preparation and presentation of the consolidated financial statements that give a true and fair view in order to design audit procedures that Sd/- are appropriate in the circumstances but not for the purpose of .. Misra expressing an opinion on the effectiveness of the entity’s internal Place: Kolkata Proprietor control. An Audit also includes evaluating the appropriateness of Date: 28.04.2016 Membership No.:050440 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 82 83

Consolidated alance Sheet as at 31.03.2016 Consolidated Statement of Profit and Lossfor the year ended 31.03.2016 (In H) (In H) Particulars ote o. As at As at Particulars ote o. or the year ended or the year ended 31.03.2016 31.03.2015 31.03.2016 31.03.2015 IT A LIAILITIS ICOM Shareholder’s unds Revenue from Operations 19 9,875,965,624 6,921,950,441 Share Capital 2 210,430,000 100,215,000 Other Incomes 20 3,567,104 7,601,820 Reserves and Surplus 3 712,041,264 457,159,795 Total Revenue I II 5322 62552261 Minority Interest 4 62,834,931 59,902,058 PSS on-Current Liabilities Cost of Materials Consumed 21 3,301,544,908 1,450,964,747 Long Term Borrowings 5 626,659,047 622,767,335 Purchase 22 6,155,557,100 5,115,749,200 Current Liabilities Change in inventories 23 (550,760,310) (280,226,464) Short-Term Borrowings 6 1,916,797,165 917,021,333 Other Manufacturing Expenses 24 179,135,552 124,393,544 Trade Payables 7 70,901,368 99,251,149 Employee Benefit Expenses 25 41,632,410 33,862,398 Other Current Liabilities 8 151,725,837 39,780,698 Administrative & General Expenses 26 54,558,440 39,087,974 Short-Term Provisions 9 360,428,237 222,801,184 Selling & Distribution Expenses 27 115,769,855 89,442,638 TOTAL 411114 251552 Finance Costs 28 167,006,772 70,791,677 ASSTS Depreciation and Amortization Expense 10 23,079,995 24,417,418 on-Current Assets Preliminary expenses 29 646,171 25,347 Fixed Assets Total xpenses II 4103 666504 Tangible Assets 10 199,194,252 200,219,846 Profit before Tax I - IIIII 3136135 2610432 Capital Work in progress 40,116,135 - Intangible Assets 11 88,272,806 88,272,806 Tax xpense: Long-Term Loans and Advances 12 193,697,677 2,883,117 (1) Current tax 131,765,531 87,638,976 Deferred Tax Assets (Net) 13 9,461,294 11,077,747 (2) Deferred Tax Liability/(Assets) 1,616,453 1,222,514 Miscellaneous 14 3,149,468 70,693 (3) Minority Interest (Post Subsidiary) 2,932,873 5,611,031 Current Assets Profit Loss for the Period I-II 255046 16651261 Inventories 15 2,009,006,501 819,070,771 arnings per equity share of face value of H10 each Trade Receivables 16 1,131,439,390 1,129,029,805 1) Basic 30 12.12 16.62 Cash and Cash Equivalents 17 4,904,913 11,203,997 2) Diluted 30 17.30 16.62 Other Current Assets 18 432,575,413 257,069,770 SIGNIFICANT ACCOUNTING POLICIES 1 TOTAL 411114 251552 The accompanying notes form an integral part of the Consolidated Financial Statements Significant Accounting Policies 1 As per our report of even date attached or and on behalf of the oard The accompanying notes form an integral part of the Consolidated Financial Statements Sd/- As per our report of even date attached or and on behalf of the oard or .. Misra Co. Monoranan Roy Sd/- Chartered Accountants Chairman & Managing Director or .. Misra Co. Monoranan Roy Firm Registration No. 312021E (DIN: 02275811) Chartered Accountants Chairman & Managing Director Firm Registration No. 312021E (DIN: 02275811) Sd/- Sd/- Sd/- .. Misra Arup Thakur Aditya arwa Sd/- Sd/- Sd/- Proprietor Executive Director & CFO Company Secretary .. Misra Arup Thakur Aditya arwa Membership No.:050440 (DIN: 03476120) Proprietor Executive Director & CFO Company Secretary Place: Kolkata Membership No.:050440 (DIN: 03476120) Date: 28.04.2016 Place: Kolkata Date: 28.04.2016 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 84 85

Consolidated Cash low Statement for the year ended 31.03.2016 otes forming part of the Audited Consolidated inancial Statements (In H) Particulars or the year ended or the year ended OT 1 31.03.2016 31.03.2015 A. CORPORAT IORMATIO A. CASH LO ROM OPRATI ACTIITIS: Pincon Spirit Limited (referred to as “PSL” or “the Company”) (CIN No: L67120WB1978PLC031561) is a public company domiciled in India et Profit before tax 3136135 2610432 and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on The Calcutta Stock Exchange Limited & BSE Adustments for: Limited in India. The Company is engaged in carrying on the Business of Blending, Bottling & Wholesale Distribution of Indian Made Depreciation 23,079,995 24,417,418 Foreign Liquor (“IMFL”), Indian Made Indian Liquor (“IMIL”) & Refining, Packaging, & Wholesale Distribution of Fast Moving Consumer Interest Paid 167,006,772 70,791,677 Goods (“FMCG”). Miscellaneous Expenses 646,171 25,347 . SIIICAT ACCOTI POLICIS Operating Profit before orking capital changes 52043 3562224 Adustments for: a. asis of Preparation of the inancial Statements (Increase) / Decrease in Inventories (1,189,935,730) (501,090,418) The Financial Statements have been prepared in compliance with the Generally Accepted Accounting Principles in India (“Indian (Increase)/ Decrease in Account Receivable (2,409,585) (848,122,217) GAAP”) and the Accounting Standards notified under relevant provisions of the Companies Act, 2013. (Increase)/ Decrease in Loans & Advances (175,505,643) 108,803,394 These Financial Statements have been prepared on accrual basis under historical cost convention and are presented in Indian Increase/ (Decrease) in Account Payables 221,222,411 169,949,993 Rupees, rounded off to the nearest Rupee. Cash enerated from Operations 5645334 1411024 b. se of stimates Tax Paid (131,765,531) (87,638,976) The preparation of the Financial Statements in conformity with the Indian GAAP requires Management of the Company to make et Cash from Operating Activities 662305 0120000 estimates, judgments and assumptions to be made that affect the reported amount of assets and liabilities, disclosure of contingent . CASH LO ROM ISTI ACTIITIS: liabilities as on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Tangible Assets (22,054,401) - Any difference between the actual results and estimates are recognised in the period in which the results are known / materialised. Intangible Assets - (84,648,036) Capital Working in Progress (40,116,135) - c. ixed Assets Long-Term Loans and Advances (190,814,560) 52,889,582 i. Tangible Assets Miscellaneous Expenses (3,724,946) - Tangible Assets are stated at cost, net of taxes, discounts plus revaluations, if any, less accumulated depreciation & impairment et Cash from Investing Activities 25610042 315454 loss, if any. C. CASH LO ROM IACI ACTIITIS: The Cost includes the purchase price plus other attributable costs for bringing the assets to its working condition for intended Proceeds of Equity Share issue (including Premium) 135,000,000 - use. Minority Interest 319,000,000 Any subsequent expenditure relating to the Tangible Assets which increase the future benefits are added to the book value of Proceeds of Unsecured Loans 4,750,000 595,680,731 the tangible assets. Proceeds of Secured Loans 998,917,544 (70,791,677) Expenditure relating Tangible Assets that are not ready for their intended use are disclosed under Capital Work-in-Progress. Interest Paid (167,006,772) (6,012,599) ii. Intangible Assets Dividends paid (including corporate dividend tax) (24,950,509) 837,876,455 Initial recognition of Intangible Assets are at cost less accumulated amortisation and accumulated impairment loss, if any. et Cash from inancing Activities 4610263 43446 Internally generated Intangible Assets, excluding capitalised development costs, are not capitalised and expenditure is Net Increase/(Decrease) in Cash and Cash equivalents 6204 42001 reflected in the Statement of Profit & Loss for the year in which the expenditure is incurred. Amortisation of Intangible Assets Cash and Cash equivalents as at 1st April(Opening Balance) 11,203,997 6,905,996 are done on a straight-line basis over the estimated useful economic life. Cash and Cash equivalents as at 31st March(Closing Balance) 4,904,913 11,203,997 d. Leases As per our report of even date attached or and on behalf of the oard Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating Sd/- leases. Payments made under operating leases are charged to the Statement of Profit and Loss on a straight-line basis over the or .. Misra Co. Monoranan Roy period of lease. Chartered Accountants Chairman & Managing Director Firm Registration No. 312021E (DIN: 02275811) e. epreciation Amortisation In Tangible Fixed Assets (other than freehold land & capital work-in-progress), acquired during the year, depreciation / amortisation Sd/- Sd/- Sd/- is charged on Written Down Method so as to write off the cost of the Assets over the useful lives and in regard to the Tangible Assets .. Misra Arup Thakur Aditya arwa acquired prior to April 1, 2014, the carrying amount as on April 1, 2014 is depreciated over the remaining useful life as prescribed in Proprietor Executive Director & CFO Company Secretary Schedule II of the Companies Act 2013. Membership No.:050440 (DIN: 03476120)

Place: Kolkata Date: 28.04.2016 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 86 87

otes forming part of the Audited Consolidated inancial Statements otes forming part of the Audited Consolidated inancial Statements

f. Impairment q. arnings per Share PS In case an asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is charged Basic EPS is arrived at based on Net Profit after Taxation available to equity shareholders to the weighted average number of equity to the Profit and Loss Statement in the year in which an asset is identified as impaired. The impairment loss recognised in prior shares outstanding during the year. The Diluted EPS is calculated on the same basis as Basic EPS, after adjusting for the effects of accounting period is reversed if there has been a change in the estimate of recoverable amount. potential dilutive equity shares unless impact is anti-dilutive.

g. Investments r. Provisions Current investments are carried at lower of cost and quoted/fair value, computed category-wise. Non-Current investments are stated A provision is recognised when an enterprise has a present obligation as a result of a past event and it is probable that an outflow at cost. Provision for diminution in the value of Non-Current investments is made only if such a decline is other than temporary. of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions, other than employee benefits, are not discounted to their present value and are determined based on management estimate required to h. Inventories settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current Items of inventories are measured at lower of cost and net realizable value after providing for obsolescence, if any. Cost of inventories management estimates. comprises of cost of purchase, cost of conversion and other costs including manufacturing overheads incurred in bringing them to their respective present location and condition. s. Contingent LiabilitiesAssets No provision is made for liabilities which are contingent in nature. Provision is made for those contingencies which are likely to i. mployee enefits materialize into liabilities after the year end till the date of finalization of accounts and have material effect on the position stated in There is no employee who is in receipt of remuneration in excess of the limits specified. the Balance Sheet. . Revenue Recognition Contingent liabilities are not recognised but disclosure of its existence is done in the Financial Statements. A contingent asset is Revenue is recognised only when risks and rewards incidental to ownership are transferred to the customer, it can be reliably neither recognised nor disclosed in the Financial Statements. measured and it is reasonable to expect ultimate collection. Revenue from operations includes sale of goods, tax, excise duty, adjusted for discounts (net). Dividend income, if any, is recognised when right to receive payment is established. Interest income is recognised on a time proportion basis taking into account the amount outstanding and the interest rate applicable.

k. orrowing Costs Borrowing costs consist of interest and other ancillary costs than an entity incurs in connection with borrowing of funds, Ancillary costs incurred in connection with the arrangement of borrowings are amortized over the tenure of borrowing.

l. oreign Currency Transactions The Company has foreign currency transactions during the period under review.

m. Cash and Cash quivalents Cash and Cash Equivalents include cash in hand, demand deposits with banks, other short-term highly liquid investments with original maturities of three months or less.

n. Conservation of nergy Technology absorption In view of the activities of the Company, the matters related to conservation of Energy & Technology are not applicable to the Company.

o. ue to Micro Small Industrial nterprises The Company has not received any information from any of the suppliers of their being a micro/ small scale industrial enterprise, hence the amount due to such units outstanding as at the year ended 31.03.2016 is not ascertainable.

p. Income Tax Provision is made for Income Tax on a yearly basis under the tax payable method based on tax liability as computed after taking credit for allowances, expenses. In case of matters under appeal due to disallowance or otherwise, full provision is made when the liabilities are accepted. Deferred Tax is recognized on timing differences between taxable income and accounting income subject to a consideration of prudence. nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 88 89

otes forming part of the Audited Consolidated inancial Statements otes forming part of the Audited Consolidated inancial Statements

(In H) (In H) Particulars As at As at Particulars As at As at 31.03.2016 31.03.2015 31.03.2016 31.03.2015 otes 2 Share Capital otes 3 Reserves and Surplus Authorised Capital a Securities Premium 50,000,000 Equity Shares of H10/- each 500,000,000 100,300,000 As per last Balance Sheet 636,405 636,405 (Previous Year : 10,030,000 Equity Shares of H10/- each) 500000000 100300000 Addition during the year 125,000,000 - Issued Subscribed and Paid up a 125636405 636405 21,043,000 Equity Shares of H10/- each 210,430,000 100,215,000 b Surplus in the Statement of Profit Loss (Previous Year : 10,021,500 Equity Shares of H10/- each) 210430000 100215000 Opening Balance 456,523,390 295,964,728 Add: Profit for the Year 255,046,978 166,571,261 a Reconciliation of number of Shares Capital 115036 462535 quity Shares As at 31.03.2016 As at 31.03.2015 Less: Appropriations o. Amount H o. Amount H (a) Proposed final Dividend on Equity Shares* 15,782,250 5,010,750 Opening Balance 10,021,500 100,215,000 10,021,500 100,215,000 (b) Tax on Dividend 3,155,660 1,001,849 Add: Bonus Share Issue 10,021,500 100,215,000 - - (c) Conversion into Equity due to Issue of Bonus Share 100,215,000 - Add: Preferential Allotment 1,000,000 10,000,000 - - Closing alance 21043000 210430000 10021500 100215000 (d) Prior Period Dividend (F.Y: 2014-15) 5,010,750 - (e) Prior Tax on Dividend (F.Y: 2014-15) 1,001,849 - b Rights and restriction attached to Shares Capital b 564045 45652330 The Company has one class of equity shares having a par value of H10 each. Each shareholder is eligible for one vote per share held. (a+b) 12041264 45155 The Company has declared dividend of H0.75 (i.e. 7.50%) per share during the current year and in previous year dividend was of H0.50 * The Board of Directors have recommended final dividend for the F.Y: 2015-16 of H0.75 Per Equity Share subject to approval in the forthcoming (i.e. 5.00%) per share. AGM. c Share held by holdingultimate holding company andor their subsidiariesassociates : There is no such Share held by holding/ultimate holding company and/or their subsidiaries/associates. otes 4 Minority Interest Minority Interest 62,834,931 59,902,058 d Shares allotted as fully paid up by way of bonus shares during 5 years preceding March 31 2016 623431 50205 During the last 5 years preceding to March 31, 2016, the Company has allotted as fully paid up Bonus share in the ratio of 1:1 on 12.10.2015 as approved by Members in the EGM Held on 29.09.2015. e etails of shares held by shareholders holding more than 5% of the aggregate shares in the Company otes 5 Long-Term orrowings quity Shares As at 31.03.2016 As at 31.03.2015 Secured Loan - Car Loan 2,909,047 3,767,335 o. Amount H o. Amount H Unsecured Loan - Director 623,750,000 619,000,000 Monoranjan Roy: 33.20% (P.Y:29.87%) 6,986,786 69,867,860 2,993,393 29,933,930 6266504 6226335 Anushri Textile Private Limited: 0.17% (P.Y: 10.89%) 34,920 349,200 1,090,998 10,909,980 Car Loan is from Punjab National Bank, the car being the primary security. 666 6660 40431 404310 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 90 91

otes forming part of the Audited Consolidated inancial Statements As at at As 688,413 5,715,275 7,576,942 1,283,972 7,695,397 5,496,147 13,546,962 18,521,079 96,534,982 91,909,634 77,640,402 67,478,925 15,384,490 (In H) 15,384,490 22463264 2002146

Particulars As at As at 31 2015 March 31 2014 March 31.03.2016 31.03.2015 et lock et lock otes 6 Short-Term orrowings As at at As 401,088 688,413 4,680,809 5,715,275 5,496,147 4,073,192 10,039,652 13,546,962 91,909,634 87,295,382 67,478,925 55,265,238 15,384,490 Cash Credit Facilities (Secured) 1,916,797,165 917,021,333 37,438,891 2002146 114252

116165 1021333 31 2016 March 31 2015 March - Working Capital Loan has been availed under Consortium Banking arrangement, from State Bank of Mysore, (Leader of Consortium) & other -

member banks being State Bank of Hyderabad, State Bank of Travancore, Bank of India, Andhra Bank, Punjab National Bank, Laxmi Vilas Bank As at at As 5,651,920 4,617,454 2,687,347 2,400,022 4,048,016 Limited, Tamilnad Mercantile Bank Limited, Corporation Bank, Vijaya Bank, Indian Overseas Bank ,with sharing of pari passu charge by way of 5,470,971 16,654,812 13,147,502 11,517,984 16,132,236 52,352,575 64,566,262 03553 hypothecation of present & future Currents Assets of the Company, consisting of Stock & Book Debts. 11116354 March 31 2016 March 31 2015 March ------

otes Trade Payables

Trade Payables 70,901,368 99,251,149 eductions eductions 00136 25114 - - year year or the or the or 287,325 595,559 epreciation lock epreciation lock epreciation 1,034,466 1,861,667 3,507,310 4,974,117 4,625,348 4,614,252 2,199,250 1,422,955 10,161,477 otes Other Current Liabilities 12,213,687 244141 2305 Other Payables 151,725,837 38,780,698 - Security Deposit - 1,000,000 -

151253 306 As at at As 4,617,454 2,755,787 8,173,385 2,400,022 1,804,463 6,892,636 1,848,766 4,048,016 13,147,502 11,517,984 42,191,098 52,352,575 63666135 03553 April 1 2015 April 1 2014

otes Short-Term Provisions

For Income Tax & others 360,428,237 222,801,184 As at at As 3,088,435 3,088,435 9,544,163 3604223 2220114 9,544,163 10,332,729 10,332,729 26,694,464 26,694,464 15,384,490 37,438,891 103,427,618 103,427,618 119,831,500 119,831,500 23033 3103500 March 31 2016 March 31 2015 March ------year year during the during the eductions eductions ------ross lock ross lock ross during during the year the year Additions Additions 22,054,401 22054401 As at at As 3,088,435 3,088,435 9,544,163 9,544,163 10,332,729 10,332,729 26,694,464 26,694,464 15,384,490 15,384,490 103,427,618 103,427,618 119,831,500 119,831,500 23033 23033 April 1 2015 April 1 2014 otes forming part of the Audited Consolidated inancial Statements inancial part Consolidated forming otes of the Audited Assets 10 ixed otes as on 31.03.2016 Assets Tangible Particulars ear Previous as on 31.03.2015 Assets Tangible Particulars Electrical Equipment Electrical Equipment Furniture & Fixtures Furniture & Fixtures Furniture Office Equipment Office Equipment Building Building Plant & machineryPlant Plant & machineryPlant Land Land Motor Vehicle Motor Vehicle TOTAL TOTAL nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 92 93

otes forming part of the Audited Consolidated inancial Statements otes forming part of the Audited Consolidated inancial Statements

(In H) (In H) Particulars As at As at Particulars or the year ended or the year ended 31.03.2016 31.03.2015 31.03.2016 31.03.2015 otes 11 Intangible Assets otes 1 Revenue rom Operations Goodwill 88,272,806 88,272,806 Own Blend (IMFL) 2,614,529,075 1,696,064,741 2206 2206 Own Blend (IMIL) 1,227,494,005 - Traded - IMFL 3,223,960,343 3,409,112,395 otes 12 Long-Term Loans and Advances FMCG Export 996,798 60,227,514 Business Advance for Acquisitions 190,814,560 - FMCG - Domestic 2,808,985,403 1,756,545,791 Security Deposit 2,303,117 2,303,117 565624 62150441 Deposit With Excise Dept. 580,000 580,000 1366 2311 otes 20 Other Incomes Other Incomes 3,567,104 6,192,487 otes 13 eferred Tax Assets Interest Income - 1,409,333 Deferred Tax Assets 9,461,294 11,077,747 356104 60120 46124 1104

otes 21 Cost of Materials Consumed otes 14 Miscellaneous xpenditure COST O RA MATRIALS COSM IML Opening Balance 70,693 96,040 Opening Stock of Raw Materials 158,272,736 21,473,958 Incurred during the year 3,724,946 - Add: Purchase 2,535,680,324 1,671,828,701 Less: Written off during the year 646,171 25,347 Closing Stock of Raw Materials 331,820,385 158,272,736 31446 063 COST O RA MATRIALS COSM IML 236213265 15350223 Opening Stock of Finished Goods 148,488,562 64,423,386 otes 15 Inventories COST O RA MATRIALS COSM 2,362,132,675 1,535,029,923 Raw Materials 512,925,690 158,272,736 Closing Stock of Finished Goods 282,547,512 148,488,562 Finished Goods 1,496,080,811 660,798,035 (A) 2220325 1450644 200006501 1001 COST O RA MATRIALS COSM IMIL Opening Stock of Raw Materials - - Add: Purchase 1,405,040,004 - otes 16 Trade Receivables Closing Stock of Raw Materials 181,105,305 - Secured, Considered Good COST O RA MATRIALS COSM IMIL 1223346 - - Outstanding for a period exceeding six months - - Opening Stock of Finished Goods - - - Others 1,071,211,876 1,068,802,291 COST OF RAW MATERIALS CONSUMED 1,223,934,699 - - Export Receivable (above six month) 60,227,514 60,227,514 Closing Stock of Finished Goods 150,463,516 - 11314330 1120205 1034113 - Cost of Materials Consumed A 33015440 1450644 otes 1 Cash and Cash quivalents Cash in Hand & at Bank 4,904,913 11,203,997 40413 11203 otes 22 Purchases Purchase of IMFL 3,305,204,199 3,352,641,923 otes 1 Other Current Assets Purchase of FMCG 2,850,352,901 1,763,107,277 Sundry Current Assets 432,575,413 257,069,770 615555100 51154200 43255413 25060 nnual 15 eport 16 Corporate overview | Statutory reports | Financial statements 94 95

otes forming part of the Audited Consolidated inancial Statements otes forming part of the Audited Consolidated inancial Statements

(In H) (In H) Particulars or the year ended or the year ended Particulars or the year ended or the year ended 31.03.2016 31.03.2015 31.03.2016 31.03.2015 otes 23 Change in Inventories otes 2 Selling and istribution xpenses IML Business Promotion/Advertisement 52,967,579 46,142,071 Opening Stock of Finished Goods 348,053,569 200,198,351 Carriage Outwards 10,635,350 10,576,205 Closing Stock of Finished Goods 608,531,920 348,053,569 Discount & Rebate 6,166,087 2,362,956 (A) 2604351 145521 Godown Expenses 4,295,187 3,745,703 MC Godown Rent 600,000 600,000 Opening Stock of Finished Goods 164,255,904 31,884,658 Rebate on Sales 39,773,917 24,592,283 Closing Stock of Finished Goods 454,537,863 164,255,904 Salesman Commission 232,540 270,755 (B) 20215 13231246 Breakage Replacement A/c 622,452 261,805 Incidental Charge Refund A/c 69,603 128,075 Total (A+B) 55060310 20226464 Loading & Unloading Charges 407,140 762,785 115655 44263 otes 24 Other Manufacturing xpenses Sundry Manufacturing Expenses 179,135,552 124,393,544 1135552 12433544 otes 2 inance Costs Finance Expense 167,006,772 70,791,677 160062 016 otes 25 mployee enefit xpenses Salaries and Wages 41,632,410 33,862,398 41632410 33623 otes 2 Miscellaneous xpenses Written off during the year 646,171 25,347 otes 26 Administrative eneral xpenses 64611 2534 Audit Fees 290,049 255,057 Books & Periodicals 750 450 (In H) Directors Remuneration 7,860,000 7,150,000 Particulars 2015-16 2014-15 Donation & Subscription 202,833 115,424 otes 30 asis for calculation of asic and iluted arnings per Share is as under: Legal Expenses 2,614,842 1,987,452 Profit after Tax as per Profit & Loss Account 255,046,978 166,571,261 Staff Welfare 396,153 428,958 Number of Equity Share at the end of year 21,043,000 10,215,000 Organizational Expenses 22,285,905 14,353,592 Business Development 148,764 1,120 Weighted average number of Equity Shares 14,736,522 10,215,000 Travelling & Conveyance 9,678,919 8,186,524 Basic Earnings per share 12.12 16.62 General Expenses 721,058 678,880 Diluted Earnings per share 17.30 16.62 Promotional Marketing 2,918,356 92,541 Nominal Value of Shares 10.00 10.00 Rates & Taxes 6,079,874 4,617,530 Rent 1,360,937 1,220,446 5455440 304 nnualnnual15 15 Corporate overview | Statutory reports | Financial statements eporteport 16 Corporate16 overview | Statutory reports | Financial statements

rinin superior Notesotes forming forming part partof the of Audited the Audited Consolidated Consolidated Financial inancial StatementsF Statements attriutes to te space Notes # otes31 Related 31 RelatedParty Disclosures Party isclosures a) Namea ofame the related of the partiesrelated whereparties control where controlexists: exists: Subsidiary Subsidiary Companies Companies Paul DistributorsPaul Distributors Private Limited Private Limited(with effect (with from effect 21st from March 21st 2014)March 2014) Priya LaboratoriesPriya Laboratories Private Limited Private Limited(with effect (with from effect 21st from March 21st 2014)March 2014) Yours LaboratoriesYours Laboratories Private Limited Private Limited(With effect (With from effect 03rd from July2014) 03rd July2014)

b) Nameb ofame the Other of the Related Other RelatedParties/ Parties Key Managerialey Managerial Personnel Personnel Mr. MonoranjanMr. Monoranjan Roy (Chairman Roy (Chairman & Managing & Managing Director) Director) Mr. ArupMr. Thakur Arup (Executive Thakur (Executive Director Director & CFO) & CFO) ow incon as strentene its creentials as an pportunity Mr. SubrataMr. SubrataBasu (Executive Basu (Executive Director) Director) responsive company c) Aggregatec Aggregate Related RelatedParties Disclosures:Parties isclosures: (In H) (In H) SubsidiarySubsidiary Companies Companies 2015-162015-16 2014-152014-15 Sales Sales Cairmans MakingPaul DistributorsPaul Distributors the Private Limited Private Limited review o mae- liuor- - - Purchase/OtherPurchaseOther Manufacturing Manufacturing Expenses xpenses consumption Priya LaboratoriesPriya Laboratories Private Limited Private Limited 1 32,359,995sae 32,359,995yienic 21,331,00021,331,000 Yours LaboratoriesYours Laboratories Private Limited Private Limited 32,271,375an responsile32,271,375 - - incons iest contriution as een in rauatinLoan & te AdvancesLoan consumer Advances [Unsecured at te ottom nsecured Loan o te Given Loan / iven(Recovered) Recovered during theduring year] the year consumption pyrami to a superior prouct Paul DistributorsPaul Distributors Private Limited Private Limited - - (25,000,000)(25,000,000) Priya LaboratoriesPriya Laboratories Private Limited Private Limited - - (16,000,000)(16,000,000) Loan & AdvancesLoan Advances (Outstanding) Outstanding Paul DistributorsPaul Distributors Private Limited Private Limited - - - - Forward-lookingPriya LaboratoriesPriya statement Laboratories Private Limited Private Limited - - - - n tis annual report we ave isclose orwar looin inormation to enale investors to compreen our prospects an tae investment ecisions is report anKey oter Management statementsey Management written Personnel an oral Personnel tat we perioically mae contain orwar looin statements tat set out anticipate results ase on te manaement plans an assumptions e ave trie werever possile to ientiy suc statements y usin wors suc as anticipate estimate epects proects Remunerationintens plansRemuneration elies an wors o similar sustance in connection wit any iscussion o uture perormance e cannot uarantee6,600,000 tat6,600,000 tese 6,600,0006,600,000 orwar looinUnsecured statementsnsecured Loan will Taken e Loan realise (during Taken altou duringthe we year) elieve the we year ave een pruent in our assumptions e acievements o results are suect to ris uncertainties an even inaccurate assumptions Soul nown or unnown ris or uncertainties materialise or soul unerlyin assumptions prove inaccurate actual resultsMr. MonoranjancoulMr. vary Monoranjan materially Roy rom Roytose anticipate estimate or proecte eaers soul ear tis in min e unertae no 152,500,000oliation152,500,000 to pulicly 300,000,000300,000,000 upate any orwarlooin statement weter as a result o new inormation uture events or oterwise Unsecurednsecured Loan Taken Loan (Outstanding Taken Outstanding at the end at the of the end Year) of the ear Mr. MonoranjanMr. Monoranjan Roy Roy 612,500,000617,500,000 600,000,000600,000,000 PreferentialPreferential Allotment Allotment of Share of Capital Share Capital Mr. MonoranjanMr. Monoranjan Roy (Conversion Roy (Conversion of Unsecured of Unsecured Loan) Loan) 135,000,000600,000,000 - -

Contents

pportunityresponsive rinin F attriutes to space 6 ain te consumption leap appen n insit into te corporate 1 ur corporate ourney 1 Cairmans review 1 ur roust usiness moel 16 Company review 1 anaement iscussion an analysis 1 anain usiness uncertainties Statutory C inotrisyscomcom section 6 alance Seet an ccount 61 What makes Pincon Spirit Limited one of the most exciting liquor companies in India today?

PINCON SPIRIT LIMITED PINCON SPIRIT LIMITED th Annual 15 www.pinconspirit.in 38 Report 20 16