Dear Shareholders,
Your Directors take pleasure in presenting their 28th Annual Report on the business and
operations of your Company, together with the audited financial statements, for the year
ended March 31, 2023.
Your Company endeavors to remain one of the leading players in the Asset Management
business in India and keeps exploring opportunities for enhancing its global footprint as
well.
Your Company is a subsidiary Company of Nippon Life Insurance Company
("NLI"). NLI is a, fortune 500 Company and one of the largest life insurers in
the world managing assets of over USD 700 billion. It has a large global network with
presence across US, Europe, Asia, and Australia along with a 130-year track record in Life
Insurance business as well as global investments across Asset Management companies. This
pedigree brings strong synergistic benefits that very well complements your Company's
domestic expertise in the Asse Management business and provides a thrust to its
significant growth potential. Your Company expects substantial upside in terms of
increased AUM & adoption of best governance & risk management practices based on
NLI's global positioning & relationships.
FINANCIAL PERFORMANCE AND STATE OF COMPANY'S AFFAIRS
The standalone and consolidated financial statements of the Company for the financial
year ended March 31, 2023, have been prepared in accordance with the Indian Accounting
Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (the Act)
[Companies (Indian Accounting Standards) Rules, 2015] and other relevant provisions of the
Act. The financial highlights (on a consolidated and standalone basis) of the Company for
the year ended March 31, 2023, are as follows:
|
|
|
|
(Rs. Crores) |
|
Consolidated |
Standalone |
Particulars |
Year ended March 31, 2023 |
Year ended March 31, 2022 |
Year ended March 31, 2023 |
Year ended March 31, 2022 |
Gross Income |
1516.61 |
1535.63 |
1431.18 |
1428.42 |
Profit before exceptional item and tax |
927.74 |
988.67 |
917.77 |
945.43 |
Exceptional Items |
- |
- |
- |
- |
Profit Before tax |
927.74 |
988.67 |
917.77 |
945.43 |
Current Tax |
212.14 |
206.66 |
212.53 |
200.38 |
Deferred Tax |
(7.33) |
38.64 |
(9.70) |
33.84 |
Profit for the year |
722.93 |
743.37 |
714.94 |
711.21 |
Share of Profit from Associates |
0.40 |
0.79 |
- |
- |
Profit attributable to non-controlling interest |
- |
- |
- |
- |
Other Comprehensive Income |
(186) |
(0.30) |
(185) |
(0.27) |
Balance carried to Balance Sheet |
721.47 |
743.86 |
713.09 |
710.94 |
Basic EPS of Rs. 10 each |
11.61 |
12.00 |
11.48 |
11.47 |
Diluted EPS of Rs. 10 each |
11.53 |
11.80 |
11.40 |
11.28 |
The Consolidated Financial Statements of the Company form part of this Annual Report.
The annual accounts of all the subsidiary companies will be placed on the website of
the Company.
OPERATION HIGHLIGHTS
As you are aware that your Company acts as the asset manager to Nippon India Mutual
Fund ("NIMF"), which is one of the largest Mutual Fund in India, in terms of the
Quarterly Average Assets under Management (QAAUM) as on March 31, 2023.
The QAAUM of NIMF as on March 31, 2023, was Rs.2,93,159 Crores comprising of
Rs.1,30,087 Crores of Equity, Rs.54,068 Crores of Debt, Rs.38,979 Crores of Liquid Funds
and Rs.70,024 Crores of ETF assets. It may be noted that the QAAUM of NIMF as on March 31,
2022 was Rs.2,83,261 Crores comprising of Rs.1,19,062 Crores of Equity, Rs.73,173 Crores
of Debt, Rs.35,230 Crores of Liquid Funds and Rs.55,796 Crores of ETF assets.
Overall QAAUM of NIMF has increased by 3.39% during the financial year 2022-23, while
the Indian Mutual Fund Industry witnessed an overall growth of 5.55% in terms of QAAUM
(Source: AMFI).
New Schemes Launched:
During the year under review, Nippon India Mutual Fund launched the following new
schemes:
Scheme Name |
Type |
Structure |
Nippon India Nifty Alpha Low Volatility 30 Index Fund |
OPEN |
An open-ended scheme replicating/tracking Nifty Alpha Low Volatility
30 Index |
Nippon India Fixed Horizon Fund - XLIV - Series 1 |
CLOSE |
A Close Ended Scheme. Relatively High interest rate risk and moderate
Credit Risk |
Nippon India Nifty AAA PSU Bond Plus SDL - Sep 2026 Maturity 50:50
Index Fund |
OPEN |
An open-ended Target Maturity Index Fund investing in constituents of
Nifty AAA PSU Bond Plus SDL Sep 2026 50:50 Index. A Relatively High interest rate risk and
Relatively Low Credit Risk. |
Nippon India Nifty SDL Plus G-Sec - Jun 2028 Maturity 70:30 Index Fund |
OPEN |
An open-ended Target Maturity Index Fund investing in constituents of
Nifty SDL Plus G-Sec Jun 2028 70:30 Index. A Relatively High interest rate risk and
Relatively Low Credit Risk. |
Nippon India Fixed Horizon Fund XLIV - Series 4 |
CLOSE |
A Close Ended Scheme. Relatively High interest rate risk and moderate
Credit Risk |
Nippon India Fixed Horizon Fund - XLIV - Series 2 |
CLOSE |
A Close Ended Scheme. Relatively Low interest rate risk and moderate
Credit Risk |
Nippon India Nifty G-Sec Sep 2027 Maturity Index Fund |
OPEN |
An open-ended Target Maturity Index Fund investing in constituents of
Nifty G-Sec Sep 2027 Index. A Relatively High Interest rate risk and Relatively Low Credit
Risk. |
Nippon India Nifty G-Sec Jun 2036 Maturity Index Fund |
OPEN |
An open-ended Target Maturity Index Fund investing in constituents of
Nifty G-Sec Jun 2036 Index. A Relatively High Interest rate risk and Relatively Low Credit
Risk. |
Nippon India Nifty SDL Plus G-Sec - Jun 2029 Maturity 70:30 Index Fund |
OPEN |
An open-ended Target Maturity Index Fund investing in constituents of
Nifty SDL Plus G-Sec Jun 2029 70:30 Index. A Relatively High interest rate risk and
Relatively Low Credit Risk |
Nippon India Nifty G-Sec Oct 2028 Maturity Index Fund |
OPEN |
An open-ended Target Maturity Index Fund investing in constituents of
Nifty G-Sec Oct 2028 Index. A Relatively High interest rate risk and Relatively Low Credit
Risk |
Nippon India Fixed Horizon Fund XLV - Series 4 |
CLOSE |
A Close Ended Scheme. Relatively High interest rate risk and
Relatively Low Credit Risk |
Nippon India Fixed Horizon Fund XLV - Series 5 |
CLOSE |
A Close Ended Scheme. Relatively High interest rate risk and
Relatively High Credit Risk |
As on March 31, 2023, NIMF has a well-rounded portfolio of 98 schemes under various
categories such as Equity, Debt, Hybrid, Exchange Traded Funds, Index Funds, Fixed
Maturity Plans, and Interval Funds.
DETAILS OF MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE
COMPANY
There are no material changes and commitments affecting the financial position of the
Company since the date of the financial statements i.e, March 31, 2023.
DIVIDEND
During the year, the Company had declared and paid an interim dividend of Rs.4.00 per
equity share (40%) amounting to Rs.249.23 Crores. The Board has also recommended a final
dividend of Rs.7.50 per Equity Share (75%) of Rs.10/- each for the financial year ended
March 31, 2023, for the approval of the Shareholders at the ensuing Annual General
meeting. With this the total dividend for the financial year 2022-23 would be
approximately Rs.716 Crores, including the interim dividend of Rs.4.00 per equity share
distributed in November 2022. The Final dividend, if declared, will be paid after the
Annual General Meeting.
The dividend pay-out is in accordance with the Company's Dividend Distribution Policy
which forms part of this Annual Report.
AMOUNT TO BE CARRIED TO RESERVES
Your Directors do not propose any amount to be transferred to the General Reserves of
the Company.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report for the year under review as stipulated under
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing
Regulations) is presented in a separate section forming part of this Annual Report.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENT
Details of Loans, Guarantees and Investments covered under the provisions of Section
186 of the Act are given in the notes to the Financial Statements.
There is no difference between amount of the valuation done at the time of one-time
settlement and the valuation done while taking loan from the Banks or Financial
Institutions.
DEPOSITS
The Company has neither accepted nor renewed any fixed deposits during the year. There
are no outstanding or unclaimed deposits, unclaimed / unpaid interest, refunds due to the
deposit holders or to be deposited to the Investor Education and Protection Fund as on
March 31, 2023.
EMPLOYEES STOCK OPTION SCHEME
With the perspective of promoting the culture of employee ownership and to attract,
retain, motivate and incentivise senior as well as critical talent, the Company has
formulated Nippon Life India Asset Management Limited - Employee Stock Option Plan 2017
("NAM INDIA ESOP 2017") [formerly known as "Reliance Nippon Life Asset
Management Limited - Employee Stock Option Plan 2017"] ("ESOP 2017" /
"Plan") as its stock option scheme, which was launched in August 2017 and Nippon
Life India Asset Management Limited - Employee Stock Option Plan 2019 ("NAM INDIA
ESOP 2019") [formerly known as "Reliance Nippon Life Asset Management Limited -
Employee Stock Option Plan 2019"] ("ESOP 2019" / "Plan") as its
stock option scheme, which was launched in July 2019. The Nomination and Remuneration
Committee of the Board monitors and administers these Plans and from time - to - time
grants stock options to the employees.
Both ESOP 2017 as well as ESOP 2019 are in compliance with the Securities and Exchange
Board of India (Share Based Employee Benefits) Regulations, 2014 (SEBI Regulations).
However, having regard to the provisions of first provision to Section 136(1) of the
Act, the Annual Report excluding the aforesaid information is being sent to all the
Members of the Company and others entitled thereto. The certificate from the Statutory
Auditors of the Company confirming the compliance of the Securities and Exchange Board of
India (Share Based Employee Benefits) Regulations, 2014 with respect to the Company's
Employees Stock Option Scheme Plans will be available for inspection through electronic
mode. Any member interested in obtaining the same may write to the Company Secretary and
the same will be furnished on request. The details as required to be disclosed under SEBI
Regulations are available on the Company's website at https://
mf.nipponindiaim.com/investor-service/customer- service/nam-india-shareholders-investors
CAPITAL STRUCTURE
During the Financial year 2022-23, the Company issued and allotted 11,57,515 Equity
Shares to eligible employees on exercise of options granted under the Employee Stock
Option Plans of the Company. Hence, the issued, subscribed and paid-up capital of the
Company was 62,31,75,443 Equity Shares of g 10 each at the end of the Financial Year.
The Equity History of the Company has been provided in the Corporate Governance Report.
COMPLIANCE CULTURE & RISK MANAGEMENT
Your Company maintains a strong focus on Compliance and Risk Management as these are
essential elements for its long-term success. The compliance and risk functions are
managed by a dedicated and experienced team of professionals. The management has a zero
tolerance towards risk and compliance failures or breaches.
There exists a comprehensive Compliance Manual, which is reviewed by your Board of
Directors from time to time and it facilitates the Company's Compliance team to monitor
various compliance requirements effectively & comprehensively. The Compliance team
conducts periodical educative & training programmes on various regulatory compliances
matters for various sections of employees.
Your Company also has a comprehensive Risk Management Policy that envisages a
structured and consistent enterprise-wide risk management framework, based on the three
lines of defense model, to ensure that risk management processes are consistently applied
across the organisation and provide reasonable assurance regarding achievement of
organisation's objectives.
The risk management policy clearly sets out the objectives & elements of risk
management within the organisation, including the constitution of an independent Risk
Management department headed by Chief Risk Officer (reporting directly to the CEO and to
the Board of Directors), Risk Management Committee at executive and Board levels. The
policy also define the roles and responsibility of all the CXOs towards risk management as
part of first line of defense model.
Your Company promotes risk awareness culture throughout the organisation and risk
management is an integral part of decision making and day-today operations of all
activities at all levels across the organisation. There are well documented & Board
approved policies & processes to address and mitigate various risks to which the
Company is exposed. The Company also has a robust business continuity plan which is tested
on a periodic basis to ensure uninterrupted operations. The risk department conducts
various training programmes on various facets of risk management including cyber risk
awareness, conduct risk, operational risk, Anti Money Laundering, etc.
The Company has a structured risk reporting mechanism to ensure risks are monitored and
reviewed by CRO, Senior Management, RMCBs and Board on a periodic basis.
INTERNAL CONTROL SYSTEMS & THEIR ADEQUACY
The Company has an Internal Control System which is commensurate with the size, scale
and complexity of its business operations.
For effective risk management and control, the Company has established structures and
responsibilities in line with the "Three Lines of Defense" model, where 1st line
being business operations, 2nd line is the oversight functions like Risk Management and
Compliance and 3rd line is Internal Audit. To maintain its objectivity and independence,
the Internal Audit department reports to the Audit Committee. The Internal Audit
department monitors and evaluates the efficacy and adequacy of the internal control system
in the Company, its compliance with operating systems, accounting procedures and policies.
Based on the report of the Internal Auditor, process owners undertake corrective action in
their respective areas and thereby strengthen the controls. The Internal Audit department
follows up on pending audit issues and ensures that corrective actions have been taken.
Significant audit observations, if any, and corrective actions thereon, are presented to
the Audit Committee of the Board.
CORPORATE GOVERNANCE
Your Directors wish to reiterate your Company's commitment to the highest standards of
corporate governance to enhance trust of all its stakeholders. Strong & robust
corporate governance practices have facilitated your Company in standing up to the
continued scrutiny of domestic & international investors and that of various
Regulatory authorities.
The report on Corporate Governance as stipulated under Regulation 34(3) read with Para
C of Schedule V of the Listing Regulations is presented in a separate section forming part
of this Annual Report.
A Certificate from the auditors of the Company i.e. M/s. S. R. Batliboi & Co. LLP,
Chartered Accountants conforming compliance to the conditions of Corporate Governance as
stipulated under Para E of Schedule V of the Listing Regulations, is enclosed to this
Report.
VIGIL MECHANISM
In accordance with Section 177 of the Act and the Listing Regulations, the Company has
formulated a Vigil Mechanism to address the genuine concerns, if any. The Whistle Blower
policy can be accessed on the Company's website. It is affirmed that no person has been
denied access to the Chairperson of the Audit Committee.
CORPORATE SOCIAL RESPONSIBILITY
As part of its initiatives under "Corporate Social Responsibility (CSR)", the
Company has undertaken projects in the areas of promoting healthcare, education and rural
development in accordance with Schedule VII of the Act.
The Annual Report on CSR activities is annexed herewith as Annexure A.
SUBSIDIARIES & ASSOCIATE COMPANY
As of March 31, 2023, your Company had two (2) subsidiaries. One of such subsidiaries
is overseas i.e., one subsidiary in Singapore and one subsidiary in India. Both the
subsidiaries of the Company are engaged in financial services and related activities. In
addition, the Company also has an Associate company in India, which has already
surrendered its business license/ regulatory approval to act as a Pension Fund Manager.
This particular company currently has no business operations, and it is therefore proposed
to be wound up, in accordance with the applicable laws.
During the year our subsidiary company, Nippon Life India Asset Management (Mauritius)
Limited, has been voluntarily wound up.
A statement w.r.t. the performance and the financial position of the subsidiaries of
the Company forms a part of the Consolidated Financial Statements of the Company.
The performance of the financial position of the subsidiary companies is presented in
the Management Discussions and Analysis Report forming part of this Annual Report. The
policy for determining material subsidiary companies may be accessed on the Company's
website at https://mf.nipponindiaim.com/ InvestorServices/Pages/lnvestor-Policies.aspx
Further, The International Financial Services Centres Authority (IFSCA) has granted NAM
India (IFSC Branch) the certificate of registration to carry out the activities as a Fund
Management Entity (Non-Retail) under the IFSCA (Fund Management) Regulations, 2022 on
March 1, 2023.
KEY MANAGERIAL PERSONNEL
During the year under review, the following employees were the 'Key Managerial
Personnel' of the Company:
a) Mr. Sundeep Sikka - Executive Director & Chief Executive Officer;
b) Mr. Ajay Patel - Manager;
c) Mr. Prateek Jain - Chief Financial Officer; and
d) Ms. Nilufer Shekhawat - Company Secretary
DIRECTORS
During the year, Mr. Kazuyuki Saigo who was a Director as on March 31, 2022, resigned
from the directorship of the Company w.e.f. April 21, 2022. Mr. Tomohiro Yao and Mr.
Minoru Kimura were first appointed as Additional Directors of the Company w.e.f. April 21,
2022. Mr. Tomohiro Yao and Mr. Minoru Kimura were then appointed as Non-Executive Nominee
Director w.e.f. July 12, 2022.
As on the date of this Boards Report, Mr. Hiroki Yamauchi was appointed as an
additional Director (Non-Executive Nominee Director) in place of Mr. Akira Shibata. Mr.
Upendra Kumar Sinha was appointed as an additional Director (Non-Executive Independent
Director) and Chairman of the Board to be effective May 1, 2023. Both these appointments
are subject to approval of the Shareholders at the ensuing Annual General Meeting.
All the Independent Directors of your Company i.e., General Ved Prakash Malik (Retd.),
Ms. Ameeta Chatterjee, Mr. Ashvin Parekh and Mr. B. Sriram have already furnished the
required declarations that they meet the criteria of independence as laid down under
Section 149(6) of the Act.
In the opinion of the Board, the Independent Directors possess the requisite expertise
and experience and are people of high integrity and repute. They fulfil the conditions
specified in the Act and the Rules made thereunder and are independent of the management.
In terms of Section 150 of the Act read with Rule 6 of the Companies (Appointment and
Qualification of Directors) Rules, 2014, Independent Directors of the Company have
confirmed that they have registered themselves with the databank maintained by The Indian
Institute of Corporate Affairs, Manesar ('IICA'). The Independent Directors are also
required to undertake online proficiency self-assessment test conducted by the IICA within
a period of two years from the date of inclusion of their names in the data bank, unless
they meet the criteria specified for exemption. All the Independent Directors of the
Company are exempt from the requirement to undertake online proficiency self assessment
test.
PERFORMANCE EVALUATION OF DIRECTORS, BOARD AND COMMITTEES
The Company has devised a policy for the performance evaluation of the individual
directors, Board and its Committees, which also includes the criteria for carrying out the
said performance evaluation. Pursuant to the provisions of the Act and Regulation 17(10)
of Listing Regulations and as prescribed in the stated policy of the Board, the Board has
carried out an annual performance evaluation of (i) the Directors (Independent and
non-independent); (ii) itself (as a whole); (iii) its committees and (iv) fulfillment of
Independence criteria. The Board performance was evaluated based on input received from
the Board Members after considering criteria such as Board composition and structure,
effectiveness of Board / Committee processes, and information provided to the Board, etc.
In terms of the requirements of the Act, a separate meeting of the Independent Directors
was also held during the year.
BOARD AND COMMITTEE MEETINGS
During the year under review, eight (8) Board meetings were held.
Your Directors wish to inform that the functioning of the Board is supplemented by
various committees (Board sub-committees and management committees), which have been
constituted from time to time, such as Audit Committee, Committee of Directors, CSR
Committee, Stakeholders Relationship Committee, Nomination & Remuneration Committee,
Risk Management Committee of the Board, Valuation Committee, Investment Committee, Risk
Management Committee, Allotment Committee, Broker Empanelment Committee, Operating
Committee, Compliance Committee, Stewardship Committee, Proxy Voting Committee,
Information Security Risk Management Committee, etc. to name a few. Each of the aforesaid
Committees has been constituted in order to ensure due compliance with the applicable laws
and to ensure that the highest levels of corporate governance are followed and practiced.
The minutes of the meetings of each of these Committees are duly placed before the Board
for noting and confirmation.
AUDIT COMMITTEE
In terms of the requirements of Section 177 of the Act, the Audit Committee of the
Company consists of the majority of Independent Directors. As on date of this report, it
comprises Mr. Ashvin Parekh [Independent Director], Ms. Ameeta Chatterjee [Independent
Director], General Ved Prakash Malik (Retd.) [Independent Director], Mr. B. Sriram
[Independent Director], Mr. Hiroki Yamauchi [Non- Independent Director] and Mr. Minoru
Kimura [Non- Independent Director]. Mr. Ashvin Parekh acts as the Chairperson of this
Committee.
During the year, eight (8) meetings of the Audit Committee were held, which includes 1
joint Audit Committee between the Audit Committee of the Asset Management Company ('AMC')
with the Audit Committee of the Trustees and one (1) meeting to interact with the
Statutory and Internal Auditors of the Mutual Fund without the engagement of management of
the AMC as stipulated in SEBI Circular No. SEBI/HO/IMD/IMD-IDOF2/P/CIR/2022/17 dated
February 09, 2022.
Other relevant details in this regard have been provided in the Corporate Governance
Report.
NOMINATION & REMUNERATION COMMITTEE
In terms of the requirements of Section 178 of the Act, the Nomination &
Remuneration Committee of the Company consists of the majority of Independent Directors.
As on date of this report, it comprises, Ms. Ameeta Chatterjee [Independent Director],
General Ved Prakash Malik (Retd.) [Independent Director], Mr. Ashvin Parekh [Independent
Director], Mr. B. Sriram [Independent Director], Mr. Tomohiro Yao [Non-Independent
Director] and Mr. Minoru Kimura [Non-Independent Director]. General Ved Prakash Malik
(Retd.) acts as the Chairperson of this Committee.
During the year, three (3) meetings of the Nomination & Remuneration Committee were
held. Other relevant details in this regard have been provided in the Corporate Governance
Report.
The Nomination & Remuneration Policy has been provided as Annexure B to the
Board's Report.
CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
In terms of the requirements of Section 135 of the Act, the Corporate Social
Responsibility ("CSR") Committee of the Company consists of eight (8) Members.
As on date of this report, it comprises Mr. Tomohiro Yao [Non-Independent Director], Ms.
Ameeta Chatterjee [Independent Director], General Ved Prakash Malik (Retd.) [Independent
Director], Mr. Ashvin Parekh [Independent Director], Mr. B. Sriram [Independent Director],
Mr. Sundeep Sikka [CEO & Executive Director], Mr. Hiroki Yamauchi [Non-Independent
Director] and Mr. Minoru Kimura [Non-Independent Director]. Mr. Tomohiro Yao acts as the
Chairperson of this Committee.
During the year 2022-23, two (2) meetings of the CSR Committee were held. Other
relevant details in this regard have been provided in the Corporate Governance Report.
STAKEHOLDERS' RELATIONSHIP COMMITTEE
In terms of the requirements of Section 178 of the Act, the Stakeholders' Relationship
Committee of the Company consists of five Members. As on date of this report, it comprises
Ms. Ameeta Chatterjee [Independent Director], Mr. Ashvin Parekh [Independent Director],
Mr. B. Sriram [Independent Director], Mr. Tomohiro Yao [Non-Independent Director] and Mr.
Sundeep Sikka [CEO & Executive Director]. Ms. Ameeta Chatterjee acts as the
Chairperson of this Committee.
During the year, two (2) meetings of the Stakeholders' Relationship Committee were
held. Other relevant details in this regard have been provided in the Corporate Governance
Report.
RISK MANAGEMENT COMMITTEE
In terms of the relevant requirements under the Listing Regulations, the Company has
constituted a Risk Management Committee of the Board. The Committee presently comprises of
Mr. Tomohiro Yao [Non-Independent Director], Mr. Hiroki Yamauchi [Non-Independent
Director], Mr. Sundeep Sikka [CEO & Executive Director], Mr. Ashvin Parekh
[Independent Director], Mr. B. Sriram [Independent Director] and Mr. Rishi Garg [Chief
Risk Officer] as its Members. Mr. Tomohiro Yao acts as the Chairperson of this Committee.
During the year, five (5) meetings of the Risk Management Committee of the Board were
held. Other relevant details in this regard have been provided in the Corporate Governance
Report.
AUDITORS' OF THE COMPANY - STATUTORY AND INTERNAL
Statutory Auditors:
M/s. S. R. Batliboi & Co. LLP, Chartered Accountants shall hold office as Statutory
Auditors of the Company until the conclusion of this 28th Annual General Meeting.
The Company has already received a consent letter from M/s. S. R. Batliboi & Co.
LLP, Chartered Accountants communicating their willingness to be re-appointed as the
Statutory Auditors of the Company and that their re-appointment, if made, would be within
the limits as prescribed under Section 139 of the Companies Act, 2013.
Your Directors hereby recommends the reappointment of M/s. S. R. Batliboi & Co.
LLP, Chartered Accountants as the Statutory Auditors of the Company for a second term of 5
(five) consecutive years, to hold office from the conclusion of this Annual General
Meeting until the conclusion of the 33rd Annual General Meeting of the Company.
Internal Auditors:
JHS & Associates LLP, Chartered Accountants (JHS) were appointed as the Internal
Auditors of your Company for the financial year 2022-23. Having regard to their longevity
in office and as a matter of good governance, your Directors have approved the rotation of
JHS and appointed PricewaterhouseCoopers Services LLP (PWC) as the Internal Auditors of
your Company for the financial year 2023-24.
Your Directors wish to place on record the contributions made by JHS during their
tenure as Internal Auditors of your Company.
AUDITORS OF THE SCHEMES OF NIPPON INDIA MUTUAL FUND-STATUTORY AND INTERNAL
In accordance with the applicable provisions of law, the Company has appointed
Statutory and Internal Auditors for various Schemes of Nippon India Mutual Fund, who
periodically submit their reports, which are placed before the Audit Committee for
discussion, review and implementation of their recommendations.
Statutory Auditors:
M/s. Walker Chandiok & Co. LLP, Chartered Accountants were appointed as Statutory
Auditors of the Schemes of Nippon India Mutual Fund for the financial year 2022-23.
Internal Auditors:
M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Deloitte) were appointed
as Internal Auditors of the Schemes of Nippon India Mutual Fund and the Portfolio
Management Services division of the Company, for the financial year 2022-23. Having regard
to their longevity in office and as a matter of good governance, your Directors have
approved the rotation of Deloitte and appointed PricewaterhouseCoopers Services LLP (PWC)
as the Internal Auditors of the Schemes of Nippon India Mutual Fund and the Portfolio
Management Services division of the Company for the financial year 2023-24.
Your Directors wish to place on record the contributions made by Deloitte during their
tenure as Internal Auditors of the Schemes of Nippon India Mutual Fund and the Portfolio
Management Services division of the Company.
AUDITORS' REPORT
The observations and comments given by the Statutory Auditors in their report read
together with notes on financial statements are self-explanatory and hence does not
require any further comments in terms of Section 134 of the Act.
SECRETARIAL STANDARDS
During the year under review, the Company has complied with the applicable Secretarial
Standards issued by the Institute of Company Secretaries of India.
SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, your Directors had appointed M/s. M.
Siroya and Company, Mumbai, a firm of Company Secretaries in-practice to undertake the
Secretarial Audit of the Company for the financial year 2022-23. In this regard, the
Report submitted by the Secretarial Auditor is annexed as Annexure C.
Your Directors are pleased to inform you that the report from the Secretarial Auditors
does not contain any qualifications or negative remarks.
ANNUAL RETURN
Pursuant to Section 134(3)(a) and Section 92(3) of the Act read with Rule 12(1) of the
Companies (Management and Administration) Rules, 2014, the Annual Return of the Company
has been placed on the website of the Company and can be accessed at
https://mf.nipponindiaim.com/AboutUs/ FinancialReports/Pages/Annual-Return.aspx .
PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
CONSERVATION OF ENERGY:
The operations of the Company do not consume high levels of energy. Adequate measures
have been taken to conserve energy wherever feasible. Your Company uses the latest
technology and energy - efficient equipment's. Your Company only uses LED lights and
5-star air-conditioning for majority of offices. As energy cost forms a very small part of
the total costs, the impact on cost is not material.
TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION:
Business Easy Revamp - Business Easy 2.0 app, our Digital asset for our
distributors, is an all-encompassing solution that acts as a complete Customer
Relationship Management tool. The app works as a Digital branch through which distributors
can manage their Mutual Fund business virtually. With the objective of evolving the app
from a business facilitator to a growth enabler, this year saw the addition of new
enhancements and features to the app. A number of features such as Intern Distributor
addition, quick investment module were added along with meaningful reports for
distributors to maximise the usage of the App.
Investor App and Website Enhancement - Our flagship assets, namely the InvestEasy
App and the InvestEasy website are constantly upgraded to include enhancements and
innovations. These include workflow enhancements such as Cart Buying where users can
purchase more than one product at a time. A number of regulatory compliance requirements
have been added in the year as well.
Process Automation across Organisation - As part of the automation initiative a
number of processes have been automated across operations, finance, risk and technology.
This has freed up resources to be redeployed elsewhere.
Implementation of cloud initiatives - Continuing on NAM India's cloud journey a
number of initiatives on cloud where the infrastructure for initiatives such as Data Lake,
Analytics, new core applications have been implemented on the AWS cloud.
RESEARCH AND DEVELOPMENT DIGITAL ADOPTION AND INNOVATION:
Nippon India Mutual Fund, continue to envision and execute key Digital transformation
endeavors year on year that are aimed to strengthen our already robust Digital ecosystem.
Focus always remains on empowering our investors during moments of truth and on
a 'here & now' manner to take quicker, smarter, and well- informed decisions on how
and where they should invest their money when they transact on our Digital assets. Such
empowerment is fueled by our capabilities to crunch & run real-time analysis on the
enormous amount of on-asset & offline data points we have regarding our consumers,
their past purchases, and future propensities.
Intelligent, data led digital assets, can learn, and predict user behavior
powered by both the real time frameworks and archived analytical frameworks which are
operating on an advanced algo network. This helps in e-serving highly personalised and
customised experiences to give our millennial, zillennial and legacy investors or partners
accurate recommendations, suggestions, on-the-fly nudges, predictive service and much more
as they advance in their journeys.
Implementation of Data Models for cross sell and upsell have been implemented as part
of the innovation adoption initiatives. As part of this movement third party model
creators have been engaged with enhancing the data models of the organisation. Use cases
are created with the support of business to identify patterns and opportunities in the
models and campaigns are triggered on the analytics ecosystem to connect with customers
and track the efficacy of the models.
We at NAM India also are working on further enhancing our digital assets by bringing in
innovation in the payment gateway space especially towards frictionless payments. The
current payment gateway ecosystem gives us as Digital innovators a lot of play with
respect to designing workflows especially in the UPI space.
FOREIGN EXCHANGE EARNINGS AND OUTGO:
During the year under review, the Company earned foreign exchange equivalent to g 18.09
Crores (Previous Year: g 22.85 Crores). The Company spent foreign exchange equivalent to g
11.25 Crores (Previous Year: g 6.98 Crores).
DIRECTORS' RESPONSIBILITY STATEMENT
As per the requirements of Sub Section (5) of Section 134 of the Act, the Directors
confirm that -
(i) In the preparation of the annual accounts for the financial year ended March 31,
2023,the applicable accounting standards have been followed and that there are no material
departures;
(ii) The Directors have selected such accounting policies in consultation with the
Statutory Auditors' and have applied them consistently and made judgments and estimates
that were reasonable and prudent so as to give a true and fair view of the state of
affairs of the Company as at March 31, 2023 and of the profit of the Company for the year
under review;
(iii) The Directors have taken proper and sufficient care to the best of their
knowledge and ability for the maintenance of adequate accounting records in accordance
with the provisions of the Act, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
(iv) The Directors have prepared the annual accounts of the Company on a 'going
concern' basis;
(v) The Directors have laid down internal financial controls to be followed by the
Company and that such internal financial controls are adequate and were operating
effectively;
(vi) The Directors have devised proper systems to ensure compliance with the provisions
of all applicable laws and that such systems are adequate and operating effectively.
CONTRACT AND ARRANGEMENTS WITH RELATED PARTIES
All contracts/ arrangements/ transactions entered into/ by the Company during the
financial year under review with related parties were on an arm's length basis and in the
ordinary course of business. There were no materially significant related party
transactions which could have potential conflict with the interest of the Company at
large. During the year, the Company had not entered into any contract / arrangement /
transaction with related parties which could be considered material in accordance with the
policy of the Company on materiality of related party transactions.
All Related Party Transactions were placed before the Audit Committee for approval.
Prior omnibus approval of the Audit Committee was obtained for the transactions which were
of a repetitive nature. The transactions entered into pursuant to the omnibus approval so
granted were reviewed and statements giving details of all related party transactions were
placed before the Audit Committee and the Board of Directors for their review on a
quarterly basis. The policy on Related Party Transactions as approved by the Board is
uploaded on the Company's website at the following link: https://mf.nipponindiaim.com/InvestorServices/Pages/Investor-Policies.aspx
Your Directors draw attention of the Members to Note No. 28 to the financial statement
which sets out related party disclosures.
PARTICULARS OF FRAUDS REPORTED BY THE AUDITORS'
In terms of Section 143(12) of the Act, M/s. S R Batliboi & Co. LLP, Chartered
Accountants, the Statutory Auditors of the Company have not reported any instance of fraud
having taken place during the year under review, in their Audit Report.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant material orders passed by the Regulators/ Courts which would
impact the going concern status of the Company and its future operations.
DETAILS OF APPLICATION MADE BY THE COMPANY OR ANY PROCEEDING PENDING UNDER THE
INSOLVENCY AND BANKRUPTCY CODE, 2016 (31 OF 2016) DURING THE YEAR ALONGWITH THEIR STATUS
AS AT THE END OF THE FINANCIAL YEAR
The Company on behalf of the schemes of Nippon India Mutual Fund invests in various
debt market instruments (non-convertible debentures) issued by various issuers. In order
to realise the debenture outstanding's, the Company has filed certain applications under
the Insolvency and Bankruptcy Code, 2016. The Mutual Fund Division of the Company has
filed (a) an IBC proceeding against Avantha Holdings Limited in January 2020 before
Hon'ble NCLT New Delhi which is withdrawn as Avantha Holdings Limited has paid its dues.
The Company is also a respondent party to an IBC proceeding filed in the matter of Reserve
Bank of India v. Dewan Housing Finance Corporation Limited pending before the Hon'ble
NCLT, Mumbai.
The Portfolio Management Services Division of the Company has filed:
(a) IBC proceedings against Fortuna Buildcon India Private Limited was filed in
November 2017 before the Hon'ble NCLT, Bangalore, wherein currently the resolution plan
has been submitted to the Hon'ble NCLT for approval
(b) three IBC proceedings against three Biodiversity Conservation India Private Limited
group companies (BCIL Zed Ria Properties Private Limited, BCIL Red Earth Developers India
Pvt. Ltd. and Biodiversity Conservation India Private Limited) were filed in December 2017
before the Hon'ble NCLT, Bangalore. The NCLT has approved resolution plans in BCIL Zed Ria
Properties Private Limited and in BCIL Red Earth Developers India Pvt. Ltd., which are
currently under implementation while Biodiversity Conservation India Private Limited is
currently under liquidation. The Company is also a respondent to 2 (two) appeals in BCIL
Red Earth Developers India Private Limited and in 3 (three) appeals in BCIL Zed Ria
Properties Private Limited, before Hon'ble NCLAT, Chennai, which have been filed
challenging the approved resolution plans;
(c) IBC proceedings have been filed against the promoters of Biodiversity Conservation
India Private Limited in November 2020 before Hon'ble NCLT, Bangalore which are currently
at a pre-admission stage;
(d) IBC proceeding filed against Green Valley Shelters Private Limited in December
2019, before Hon'ble NCLT, Chennai, was admitted in August 2021, however the proceedings
are currently temporarily stayed under an order of the Supreme Court. The Company is a
respondent in a civil appeal filed by the promoters of Green Valley Shelters Private
Limited before the Hon'ble Supreme Court, challenging the admission of IBC proceedings
against Green Valley Shelters Private Limited, which is currently pending under directions
of exploring a settlement;
(e) an IBC proceeding filed against the promoters of Green Valley Shelters Private
Limited in October 2020 before the Hon'ble NCLT, Chennai and is at a pre-admission stage;
(f) an IBC proceeding was filed against Arkie Atelier Design India Private Limited,
being the corporate guarantor for the debentures issued by Green Valley Shelters Private
Limited in November 2021 and is currently at a preadmission stage;
(g) an IBC proceeding filed against Bharucha & Motivala Infrastructure Private
Limited, being corporate guarantor for the debentures issued by Lake District Realty
Private Limited, in November 2019 before Hon'ble NCLT, Mumbai was admitted in May 2021,
but has been stayed pursuant to an order of the Hon'ble NCLAT in July 2021. The Company is
a respondent in the appeal filed by the promoters of Lake District Realty Private Limited
before the Hon'ble NCLAT, Delhi, challenging the admission of IBC proceedings against
Bharucha & Motivala Infrastructure Private Limited, which is currently reserved for
orders;
(h) IBC proceedings have been filed against the promoters of Lake District Realty
Private Limited in November 2021, which is currently at a pre-admission stage;
(i) an IBC proceedings has been filed against Ashapura Options Private Limited, being
the corporate guarantor for the debentures issued by Ashapura Housing Private Limited in
February 2022 which is at a pre-admission stage.
(j) IBC proceedings have also been filed against four (4) promoter guarantors of
Ashapura Housing Private Limited, which are at a pre-admission stage.
COST RECORDS
The Company is not required to maintain cost records as specified by the Central
Government under subsection (1) of section 148 of the Companies Act, 2013.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
In terms of the provisions of Section 197 of the Act read with Rule 5 of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, a
statement showing the names and other particulars of the employees drawing remuneration in
excess of the limits set out in the said Rules are provided in the Annexure to the Board's
Report. Disclosures relating to the remuneration and other details as required under
Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, as amended also forms part of this
Report. However, having regard to the provisions of Section 136 of the Act, the Annual
Report excluding the aforesaid information is being sent to all the Members of the Company
and others entitled thereto. Any member interested in obtaining the said information may
write to the Company Secretary. Upon such request the information shall be furnished.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
Your Company has in place a Prevention of Sexual Harassment Policy in line with the
requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition
& Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been set up to
redress complaints received regarding sexual harassment. All employees (permanent,
contractual, temporary, trainees) are covered under this Policy. Following is a summary of
sexual harassment complaints received and disposed off during the year:
No. of complaints received: 0
No. of complaints disposed off: 0
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
Pursuant to Regulation 34(2)(f) of Listing Regulations, top 1000 listed entities by
market capitalisation have to publish a Business Responsibility and Sustainability Report
from FY 2022-23. Business Responsibility and Sustainability Report for the year under
review as stipulated under Listing Regulations is presented in the separate section
forming part of this Annual Report.
AWARDS AND RECOGNITIONS
Some of the awards & recognitions, which came to NAM India include,
Included in the elite "Kincentric Best Employers Club- 2023" an
exclusive and prestigious group of organisations chosen across all industries who have
been Best Employers consistently in the last 3-5 years
Awarded Best Employer 2022 Award - 5th time in last 7 years
Won the Outstanding Employee Engagement Award from Ekincare for our Health &
Wellbeing initiative (Amongst only 9 Companies recognised in the country)
ACKNOWLEDGEMENTS
Your Directors wish to place on record their sincere appreciation for the co-operation
received from various regulatory and governmental authorities including SEBI, RBI,
Registrar of Companies, Maharashtra at Mumbai, PFRDA, NPS Trust, EPFO, CMPFO, Stock
Exchanges, Depositories, Custodians, Bankers, Registrar, Shareholders, Investors and all
other business constituents during the year under review. We believe all of them have
contributed to our continued growth.
Your Directors also wish to place on record their deep appreciation for the total
commitment displayed by all the executives, officers and staff, resulting in yet another
eventful performance for the year.
FOR AND ON BEHALF OF THE BOARD OF DIRECTORS OF
NIPPON LIFE INDIA ASSET MANAGEMENT LIMITED
Ashvin Dhirajlal Parekh |
Sundeep Sikka |
Director |
Executive Director & CEO |
(DIN: 06559989) |
(DIN: 02553654) |
Place : Mumbai |
|
Dated : April 25, 2023 |
|
|