Charting New High- Potential Frontiers
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CHARTING NEW HIGH- POTENTIAL FRONTIERS ANNUAL REPORT 2016-17 TABLE OF CONTENTS CORPORATE REVIEW 06 Our Enterprise 08 Measures of Success 10 Our Path 11 Our Values 12 Board of Directors STRATEGIC REVIEW 20 Chairman’s Letter 22 Managing Director’s Letter 26 Business Review 48 CORPORATE GOVERNANCE MANAGEMENT DISCUSSION REPORT AND ANALYSIS 30 Max Ventures and Industries 34 Max Speciality Films 62 GENERAL SHAREHOLDER 40 Business Responsibility Review INFORMATION 67 FINANCIAL REVIEW Standalone Financial Statements Consolidated Financial Statements CORPORATE REVIEW OUR ENTERPRISE MEASURES OF SUCCESS OUR PATH OUR VALUES BOARD OF DIRECTORS Corporate Review OUR ENTERPRISE Max Ventures & Industries (MaxVIL) serves as the Group’s entrepreneurial arm to explore the ‘wider world of business’, especially taking cues from the economic and commercial reforms agenda of the present Government, including ‘Make in India’, ‘Skill India’, ‘Digital India’, among others. Launched in 1988, Max Speciality Films is a subsidiary of MaxVIL, based in Railmajra, Punjab. It is a leading manufacturer of speciality packaging films, with revenues of ` 666 Cr. Max Estates will leverage the Max Group’s in-house experience in activities aligned with Real Estate and its access to the sponsor’s private and Group land bank. The Company has already commenced work on its maiden project in Dehradun. Max I. Limited Max I. Ltd, a wholly owned subsidiary, will provide intellectual and financial capital to early-stage organizations, with sound business models and proven revenue stream, across identified sectors. Max Learning MaxVIL’s Education vertical recognises the gap in provision of quality education and views this as a genuine opportunity not merely in terms of business but also in terms of making a significant positive social impact. 6 Max India Limited, a multi-business corporate, Max Financial Services owns and actively owns and actively manages a 45.95% stake manages a majority stake in Max Life Insurance in Max Healthcare, a 51% stake in Max Bupa Company Limited, making it India’s first listed Health Insurance and a 100% stake in Antara company focused exclusively on life insurance. Senior Living. Max Life is a joint venture with Mitsui Sumitomo Insurance (MSI), a Japan headquartered global leader in life insurance. Launched in 2000, Max Healthcare is an equal JV partnership between Max India and Life Healthcare, South Africa. It is a Launched in 2000, Max Life offers comprehensive long term leading provider of standardised, seamless and world-class savings, protection and retirement solutions through its high healthcare services, focused on tertiary and quaternary care. quality agency distribution and multi-channel distribution Max Healthcare has revenues of ` 2,567 Cr. from over 2,500 partners. It is India’s largest non-bank private life insurer, with ` beds across 14 hospitals. revenues of 12,937 crore and a customer base of 3.9 million across 210 offices in 143 cities in India. Launched in 2008, Max Bupa is a 51:49 JV with Bupa Finance Plc., UK. It is one of India’s leading standalone health insurance companies with Gross Written Premium (GWP) of ` 594 crore, about 17,000 agents and tie-ups with over 3,600 quality hospitals across over 350 cities in India. Launched in 2013, Antara is a 100% subsidiary of Max India. It is pioneering the concept of ‘Age in Place’ for people over 55, by developing Senior Living communities in India. The first Antara community was launched in April 2017 near Dehradun, Uttarakhand. Launched in 2008, Max India Foundation (MIF) represents the Max Group’s social responsibility aspirations. The Foundation’s work is focussed on healthcare for the underprivileged and has benefitted over 28,00,000 people in over 730 locations since its inception. 7 Corporate Review MEASURES OF SUCCESS* Consolidated Operating Revenues of ` 656 Cr. New York Life subsidiary invests ` 121 Cr. for 100% growth 22.51% stake in MaxVIL in MaxVIL share price since listing Japan-based Toppan Printing Co. Ltd inducted as JV partner for Max Speciality Films with Investments made in investment of at Azure Hospitality ` 199 Cr. and Nykaa.com. More high-growth prospects being explored * as at 31st March, 2017 8 ~1 Million sq. ft of commercial and residential space under development by Max Estates Exploratory work commenced for Max Learning Limited Benefitted 28,00,000 20% inventory sold in Max Estates’ lives in 730 locations across maiden project in India through Max India Dehradun Foundation 9 Corporate Review OUR PATH Our Vision Our Mission To address the • Deliver sustainable growth wider world and profitability through of business entrepreneurial initiatives opportunities in India and • Tap ‘Made in India’ abroad with fresh opportunities with a diverse standards of portfolio of product and entrepreneurial services linked to India and excellence. International markets • Maintain cutting edge standards of governance 10 OUR VALUES Sevabhav We encourage a culture of service and helpfulness so that our actions positively impact society. Our commitment to Seva defines and differentiates us. Excellence We gather the experts and the expertise to deliver the best solutions for life’s many moments of truth. We never settle for good enough. Credibility We give you our word. And we stand by it. No matter what. A ‘No’ uttered with the deepest conviction is better than a ‘Yes’ merely uttered to please, or worse, to avoid trouble. Our words are matched by our actions and behaviour. 11 Corporate Review BOARD OF DIRECTORS MR. ANALJIT SINGH MR. MOHIT Talwar MR. SAHIL VACHANI Chariman Vice Chairman Managing Director and CEO Mr. Analjit Singh is the Founder and Mr. Mohit Talwar is the Managing Director Mr. Sahil Vachani is Managing Director & Chairman Emeritus, Max Group, and of Max Financial Services and Max India, CEO, Max Ventures and Industries Limited. Chairman of Max Ventures & Industries and and Vice Chairman of Max Ventures & He has diverse experience across various Antara Senior Living. An industry statesman, Industries Limited (MaxVIL). In addition, he sectors including consumer durables and real he was awarded the Padma Bhushan, one is the Chairman of Max Speciality Films and estate. He started his career as a banker with of India’s top civilian honours in 2011. He serves on the Boards of Max Life Insurance, Citigroup in London, where he worked on is also the Chairman of Vodafone India and Max Healthcare, Max Bupa and Antara Mergers and Acquisitions across the Middle is on the Board of Sofina NV/SA, Belgium. Senior Living. East and Africa region. In 2004, he joined He has significant interests in real estate in Dixon Technologies, a consumer appliance India and lifestyle related ventures in the As the Deputy Managing Director of the manufacturing firm as Business Head and Western Cape, South Africa, pertaining to erstwhile consolidated Max India Limited, setup new verticals across multiple locations viticulture, wine making and hospitality. Mr. he successfully leveraged his strong and was involved in the launch of new Analjit Singh is a member of the Founder relationships with institutional investors, products, setting up of new manufacturing Executive Board of the Indian School of hedge funds, banks and private equity firms facilities and establishing relationships with Business (ISB) and has served as Chairman of and led several complex corporate finance leading brands as customers. Board of Governors of the Indian Institute of and financial structuring deals to ensure Technology (IIT), Roorkee. He was awarded adequate investment and liquidity for the His next career progression was in 2008 the Ernst and Young Entrepreneur of the Group’s operations. He has played a central as Co-founder and Managing Director of Year Award (Service Category) in 2012 and role in executing key transactions including Dixon Appliances Pvt. Ltd., where he was the US India Business Council Leadership the setting up of Max Bupa Health Insurance, responsible for the business from inception Award in 2013. In 2014, he was awarded bringing on board MS&AD Insurance Group including designing of products, building the with Spain’s second highest civilian honour, Holdings as the new JV partner for Max Life, team, setting up the manufacturing facility, the Knight Commander of the Order of Life Healthcare’s entry in Max Healthcare and operations and building relationships with Queen Isabella. He is an alumnus of Doon later the equalization of its stake in the business leading brands in India such as Panasonic, School and Shri Ram College of Commerce and completing the mega-restructuring of Godrej, LG, among others. The Company (SRCC), Delhi University and holds an MBA the erstwhile Max India into three new listed emerged as the single-largest third party from Boston University. He also serves as the companies, which received a significantly contract manufacturer of Washing Machines Honorary Consul General of the Republic of positive reaction from capital markets. for the Indian market. In July 2015, San Marino in India. Mr. Talwar was instrumental in executing Mr. Vachani sold his shareholding in the a stake repurchase transaction with IDFC company to pursue new opportunities. Limited and more recently a transaction with IFC to repurchase its stake in Max Healthcare. He has also overseen key transactions in MaxVIL, including the induction of Toppan Group as a JV partner in Max Speciality Films, and a 22.5% stake sale to New York Life’s subsidiary. Mr. Talwar has a wealth of experience in Corporate Finance and Investment Banking, and spent 24 years in Wholesale Banking in Standard Chartered, ANZ Grindlays and Bank of Nova Scotia. 12 MR. ARTHUR H. SETER MR. ASHOK KACKER MR. D.K. Mittal Additional Director Independent Director Independent Director Mr. Arthur H. Seter, CFA is Senior Vice Mr. Kacker, M. Sc. (Physics), University of Mr. D. K. Mittal is a former Indian President, Deputy Chief Investment Officer Allahabad (Topper of the 1972 batch), Administrative Service (IAS) officer from and Chief Derivatives Officer of New York has more than 3 decades of experience the batch of 1977 and has served the Life Insurance Company.