Larsen & Toubro Infotech Ltd Directors Report.

To the Members of

LARSEN & TOUBRO INFOTECH LIMITED

Your Directors have pleasure in presenting the Integrated Annual Report along with the Audited Financial Statements of Larsen & Toubro Infotech Limited (‘LTI or ‘Company) for the year ended March 31, 2021 (‘FY21).

1. Financial Results

(Rs. in million)

Particulars Standalone Consolidated
2020-21 2019-20 2020-21 2019-20
Revenue from operations 115,626 101,842 123,698 108,786
Other Income 2,247 4,217 2,744 3,292
Total Income 117,873 106,059 126,442 112,078
Less: Operating Expenditure 90,578 83,185 96,447 88,493
Less: Finance Cost 716 720 788 826
Less: Depreciation and amortization 2,669 2,084 3,325 2,730
Profit Before Tax (PBT) 23,910 20,070 25,882 20,029
Less: Provision for Tax 6,036 4,546 6,500 4,824
Profit forthe year (PAT) 17,874 15,524 19,382 15,205
Less: Non-Controlling Interests 0 - 21 4
Add: Balance brought forward from previous year 47,564 38,359 47,530 38,659
Less: Transition impact of IND AS 116 0 629 0 640
Balance available for disposal which Directors appropriate as follows: 65,438 53,254 66,891 53,220
Less: Dividend (excluding tax) 5,324 4,875 5,324 4,875
Less: Tax on Dividends 0 815 0 815
Balance to be carried forward 60,114 47,564 61,567 47,530

2. Performance of the Company

On standalone basis, revenue from operations and other income for the financial year under review were Rs. 117,873 Million as against Rs. 106,059 Million for the previous financial year registering an increase of 11.14%. The profit before tax was Rs. 23,910 Million and the profit after tax was Rs. 17,874 Million for the financial year under review as against Rs. 20,070 Million and Rs. 15,524 Million, respectively for the previous financial year.

On consolidated basis, revenue from operations and other income for the financial year under review were Rs. 126,442 Million as against Rs. 112,078 Million for the previous financial year registering an increase of 12.82%. The profit before tax was Rs. 25,882 Million and the profit after tax was Rs. 19,382 Million for the financial year under review as against Rs. 20,029 Million and Rs. 15,205 Million, respectively for the previous financial year.

3. Capital Expenditure

On standalone basis, as at March 31, 2021, the gross fixed and intangible assets stood at Rs. 11,099 Million (previous year Rs. 9,728 Million) out of which assets amounting to Rs. 1,726 Million (previous year Rs. 2,092 Million) were added during the year and the net fixed and intangible assets stood at Rs. 4,795 Million (previous year Rs. 4,563 Million).

On consolidated basis, as at March 31, 2021, the gross fixed and intangible assets stood at Rs. 25,521 Million (previous year Rs. 22,190 Million) out of which assets amounting to Rs. 3,231 Million (previous year Rs. 3,558 Million) were added during the year and the net fixed and intangible assets stood at Rs. 13,501 Million (previous year Rs. 12,097 Million).

4. Integrated Report

As a good corporate governance practice, the Company is continuously enhancing the quality of disclosures being made available to the stakeholders and accordingly, a similar step on this front has been taken by voluntarily providing an Integrated Report for the reporting financial year, which encompasses both financial and non-financial information to enable the stakeholders to take well informed decisions and have a better understanding of the Companys long term perspective, vision and value creation model.

The Integrated Report is in terms of the Guiding Principles prescribed by the International Integrated Reporting Council (‘IIRC) and has details about organisations strategy, governance framework, performance and prospects of value creation based on the six forms of capital viz. financial capital, manufactured capital, intellectual capital, human capital, social and relationship capital and natural capital.

5. Material changes and commitments affecting the financial position of the Company, between the end of the financial year and the date of this Report

There have been no material changes and commitments affecting the financial position of the Company, between the end of the financial year and the date of this report.

6. Changes in Share Capital

During FY21, the Company allotted 623,839 equity shares of Rs. 1 each on exercise of the vested options by the eligible employees under Employee Stock Option Scheme 2015 of the Company. Accordingly, the paid-up equity share capital of the Company increased from Rs. 174.13 Million to Rs. 174.75 Million. After March 31, 2021, the Company has further allotted 11,720 equity shares of Rs. 1 each on May 4, 2021, on exercise of vested options by the eligible employees under the Employee Stock Option Scheme 2015 of the Company. The equity shares allotted under the Employee Stock Option Scheme 2015 rank pari-passu with the existing equity shares of the Company. Consequently, as on the date of this report, the paid-up equity share capital of the Company is Rs. 174.76 Million.

7. Dividend and Dividend Distribution Policy

The Directors are pleased to recommend final dividend of Rs. 25/- per equity share of face value of Rs. 1/- each. During the financial year ended March 31, 2021, the Company paid an interim dividend of Rs. 15/- per equity share. The total dividend for FY21, including the final dividend, if approved by shareholders, would amount to Rs. 40/- per equity share. The final dividend if approved by the shareholders would be paid/ payable to those shareholders whose name appear in the Register of Members as on the record date mentioned in the Notice convening the 25th Annual General Meeting (‘AGM) of the Company.

The Dividend is based upon the parameters mentioned in the Dividend Distribution Policy which is available on the Companys website at www.Lntinfotech.com/Investors

8. Human Resource

Our employees are the foundation of our success at LTI. Our employees have shown extraordinary grit and resilience in the challenging year gone by and have been the primary reason for LTI setting the growth benchmark in the industry. LTI has strengthened several development programs and built new ones during the FY21 with the vision of further fortifying and deepening the skills of our workforce of over 35000 LTItes across the globe in keeping with the evolving needs of our business.

To learn more about our efforts in the human resource development space, please refer to the ‘Human Capital section of the Integrated Report Section in this Annual Report.

9. Marketing

Brand LTI, is now four years old. Through its contemporary style and messaging, LTI has gained recognition as one of the leading global technology brands. The Company stepped up its efforts toward gaining mindshare of clients, prospects and other stakeholders by delivering crisp and consistent messaging across relevant channels. It leveraged robust marketing technology stack to remodel its outreach initiatives, given the change in customer behavior due to challenges posed by the pandemic, the Company continued to garner accolades for its efforts and initiatives.

10. Awards & Recognition

Corporate/ Marketing awards:

1. LTI is the fastest growing brand in Brand Finance IT Services 25 2021 ranking.

2. LTI ranked 75th in Business India Super 100 Annual Rankings.

3. LTI ranked 35th (Rating ‘A) among the top 50 companies in the BW BusinessWorld India rankings for Most Sustainable Companies 2020.

4. LTI recognized as a Top Employer 2021 in the UK by the Top Employers Institute.

5. LTI won the Platinum award at the 7th CSR India Awards 2020 in the category ‘Employment Enhancing Vocational Skills.

6. LTI Wins 2020 SAP Pinnacle Award as the Industry Innovation Partner of the Year.

7. LTI recognized as the ‘Great Place to Work in the USA.

8. LTIs Powai HQ building bagged the ‘IGBC Performance

Challenge 2020 for Green Built Environment – Excellence Award under ‘ITES Building category, scoring ‘excellent in Energy Performance and Water Conservation.

Analyst and Advisory recognitions:

1. LTI topped the list of ‘IT Services Challenger 2021 in Everest Groups PEAK Matrix Service Provider of the Year™ Awards.

2. LTI Leni and LTI Mosaic recognized in The Forrester Tech Tide : Enterprise Business Insights & Analytics, Q1 2021.

3. LTI has received an Honorable Mention in the Gartner Magic Quadrant for Data and Analytics Service Providers, 2021.

4. LTI is a Leader in Digital Business Consulting and Digital Product Lifecycle Services in 2020 ISG Provider Lens™ Digital Business – Solutions and Service Partners report for the US.

5. LTI recognized in Forresters Now Tech: Oracle Apps Implementation Services Providers, Q2 2020.

6. LTI recognized as a Rising Star for Managed Application Services in the ISG Provider Lens™ Salesforce Ecosystem Partners 2020 US Report.

7. LTI recognized as a Leader in ISG Provider Lens™: SIAM/ ITSM 2020 Study for US Market.

8. LTI recognized in Forresters Now Tech: IoT Consultancies in Asia Pacific, Q1 2020.

9. LTI recognized as Leader and Star Performer in Everest Groups Application and Digital Services in Capital Markets PEAK Matrix Assessment 2021.

10. LTI positioned in ‘Leaders Quadrant within NelsonHalls Software Testing: Quality Engineering NEAT 2020.

11. LTI recognized as a Leader in Everest Group Insurance Business Model Innovation Enablement Services PEAK Matrix Assessment 2021.

12. LTI recognized as a Leader and Rising Star in the ISG Provider Lens™ Next-Gen Private/Hybrid Cloud – Data Center Services & Solutions Report, Nordics 2020.

13. LTI recognized as a Leader in Payment Ecosystem Services in their 2020 ISG Provider Lens™ Banking Industry Ecosystem 2020 Nordics report.

14. LTI named as an Innovator in the Internet of Things (IoT) Services RadarView™ 2021 Report by Avasant.

15. LTI recognized as a Leader in Artificial Intelligence for IT Operations (AIOps) – Mid Market in the ISG Provider Lens™ Intelligent Automation – Solutions and Services Report, US 2020.

16. LTI ranked #1 for Next-Generation Data Services in the recent Everest Group Talent Readiness PEAK Matrix.

11. Infrastructure

The Company has always focused on maintaining State-of-the-art infrastructure and provided best-in-class facilities and services. Our footprint, majorly within Special Economic Zones, is spread across 5 cities in India. Prevailing pandemic situation has compelled the Company to revisit existing infrastructure and add new footprints in Tier 2 cities like Noida, Nagpur and Mysore.

As a result of the pandemic and health emergencies in the Country, LTI has adopted and implemented measures to ensure COVID appropriate behaviour for the safety and well-being of everyone within premises. The way we interact, collaborate, learn and deliver has changed forever. This brought about rapid and innovative changes in working culture due to which we have optimised office spaces in Mumbai, Pune and Hyderabad. During this year, our primary focus on Employee Safety has helped pioneer innovative solutions like Safe-Radius (an App that enables us to track health of employees and follow Social Distancing norms) which exhibits our commitment towards Digital infrastructure.

LTI Headquarters at Powai is now upgraded to a Platinum rated Green Building by U. S. Green Building Council (‘USGBC) and was awarded the "Green Building Award for Continuous Performance" by Indian Green Building Council (‘IGBC).

As on March 31, 2021 the total seating capacity for Indian Centres stands at 28,542.

12. Quality Initiatives

Client Centricity is the core of the Company Quality Policy. LTI strives to be the most client centric partner by delivering rich and meaningful experiences not only to its clients but also to its clients customers. It endeavours to continuously improve its services and solutions, with focus on agility and creativity by nurturing an environment that promotes learning and growth.

Companys endeavour to be unmatched in client centricity including its real time, transparent yet forward-thinking response amid the unprecedented challenges posed by the pandemic were acknowledged and appreciated in the recently concluded CSAT survey. Client Centricity was called out as a differentiator and Companys Net Promoter Score (‘NPS) showed a significant increase. All time high scores were registered across all key outcome measures-advocacy, satisfaction, loyalty and business value. Remote delivery during pandemic was also widely appreciated.

During the year, the Company instituted an independent Client Centricity Office with the objective of ensuring a positive experience for every client through close monitoring and actioning on project and account level feedback.

Companys proprietary Capability Maturity (LTI-CMF) framework was deployed in FY21 for the third consecutive year. It continued to instill a culture of self-discipline combined with strong collaboration within and across units. Prime benefits included increase in earnings via 14 new innovations platforms, frameworks, governance and analytics tools and industrialization of existing Intellectual Property and best practices. Project management using High Maturity (HM) practices also brought in significant savings.

Other benefits included generation of improvement ideas for client environment (more than 15% of the ideas were approved by client and implemented) and enrichment of the Central Knowledge Repository (myKM) with good practices, case studies and reusable components from all units.

Companys Service Management System was upgraded to the latest version of ISO 20000:2018 and strengthened with a Third-Party Risk Management Framework to ensure deeper understanding of customers needs, better collaboration and control of third parties.

Service Management COE has been established to further enhance service quality through focussed consultancy. It is enabled by proprietary tools - ITIL Assessment framework (to assess effectiveness of ITIL process implementation), iautodoc (AI based tool for tracking contractual commitments) and Ticket Data Audit (inhouse tool to automate the ticket audits).

Companys Quality Management Systems (QMS) was enriched with Agile Development Framework (ADF) & LENI product development framework. An approach for Enterprise Architecture in the context of transforming Breakaway Enterprises, technology stack recommendations and new processes for the Life Sciences and Security domain (CDRC) were also added. Digitized role-based trainings were enhanced and extended to additional key delivery roles. The High Maturity (HM) practice got a boost with the release of new technology baselines, new HM models and BGenie- LTIs proprietary Liferay based tool which has automated the benchmarking process reducing project manager efforts by 75%.

The Companys Escalation Risk Review (ERR) framework with escalation path right up to the Chief Operating Officer was very effective in getting timely attention at the appropriate level thus arresting possible client escalations and ensuring a positive client experience at every stage during the engagement.

Remote Auditing and Delivery Health Assessment via a mobile app to capture and report details of service performance and disruption events detail enabled senior leadership to take timely decisions during the pandemic.

"Design Driven Delivery" suitably supported by Agile and DevOps methodologies, has helped the Company to design and deliver client focused services and solutions. Agile Assessment Framework was deployed to improve the adoption of the agile best practices. Continued focus on "Extreme Automation" helped to further optimize delivery execution, improve productivity and reduce costs for us and our clients. Lean, Six Sigma, Value Stream mapping and Agile based initiatives helped to bring in around 15% improvement in productivity for many teams. Unified dashboard which provided insights into performance of all the delivery execution parameters simplified governance and resulted in elimination of manual efforts by 75%.

LTIs entry in ‘BGenie statistical analysis automation based on our proprietary tool was among top 12 finalists at the Watts Humphrey Conference organized by SPIN Chennai.

Certifications:

The Company continues to demonstrate its ability to drive its Quality, Service Management, Information Security, Environmental & Health commitments effectively and efficiently through its ISO 9001, ISO 27001, ISO 14001, ISO 20000, and ISO 45001 certification accreditations by Bureau Veritas. Compliance to ISAE 3402 for projects in the Insurance domain and for client specific engagements in the other domains across all Delivery Units was sustained. The Company continues to retain its Level 5 status on the CMMI DEV & CMMI SVC constellations. CMMI 2.0 Level 5 will be completed by 2022.

Our commitment to client centricity and culture of continuous improvement thus continues – enabled by a firm commitment to our beliefs to ‘Go the Extra Mile, "Keep Learning" & ‘Push Frontiers of Innovation.

13. Transfer to Reserves

The Directors do not propose to transfer any amount to reserves.

14. Deposits

During the year ended March 31, 2021, the Company has not accepted any public deposits and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the Balance Sheet.

15. Directors Responsibility Statement

The Board of Directors hereby confirm that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed and there has been no material departure;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on March 31, 2021 and of the profit of the Company for the year ended March 31, 2021;

(iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) the Directors have prepared the annual accounts on a going concern basis;

(v) the Directors have laid down adequate system of internal financial controls to be followed by the Company and such internal financial controls are adequate and operating efficiently; and

(vi) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

16. Directors & Key Managerial Personnel

During FY21, following were the changes in the Board and Key Managerial Personnel:

a. Mrs. Aruna Sundararajan was appointed as an Independent Director of the Company for a period of 5 years with effect from May 19, 2020.

b. Mr. Arjun Gupta ceased to be an Independent Director of the Company with effect from close of business hours of October 27, 2020, on account of completion of his term of office and opting not to seek re-appointment for the 2nd term as an Independent Director due to his personal commitments.

c. Mr. Ashok Kumar Sonthalia ceased to be the Chief Financial Officer of the Company due to his resignation, with effect from close of business hours of January 25, 2021.

d. Mr. Samir T. Desai ceased to be an Independent Director of the Company with effect from close of business hours of March 31, 2021, on account of completion of his 2nd and last term of office as an Independent Director of the Company.

The Board places on record its appreciation for the services rendered by Mr. Arjun Gupta and Mr. Samir T. Desai during their tenure as an Independent Director of the Company and Mr. Ashok Kumar Sonthalia during his tenure as a Chief Financial Officer of the Company.

After FY21, the Board of Directors of the Company have approved following appointment and re-appointments: a. Mr. Anil Rander has been appointed as the Chief Financial Officer of the Company, with effect from April 14, 2021.

b. Mr. Sudhir Chaturvedi, President - Sales and Whole-time Director of the Company, whose term of office as Whole-time Director is coming to an end on November 8, 2021, has been re-appointed as the Whole-time Director, by the Board in its meeting held on May 4, 2021 for another term of five years w.e.f. November 9, 2021.

c. Mr. Sanjeev Aga, Independent Director of the Company, whose 1st term of office is getting completed on November 8, 2021, has been re-appointed by the Board in its meeting held on May 4, 2021 for 2nd term of five years w.e.f. November 9, 2021.

The Notice convening the 25th AGM includes re-appointment of above-mentioned Directors and also the re-appointment of Mr. S. N. Subrahmanyan & Mr. Sudhir Chaturvedi, Directors of the Company, who retire by rotation and being eligible, have offered themselves for re-appointment.

Shareholders are requested to refer the 25th AGM Notice for the necessary disclosures required under the Companies Act, 2013 and the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and Secretarial Standards-2 on General Meetings issued by the Institute of Company Secretaries of India.

17. Corporate Governance Report

A report on Corporate Governance is annexed as Annexure A to this Report.

18. Number of Meetings of the Board of Directors

The Board of Directors met 5 (five) times during FY21. The details of the Board meetings and their attendance is provided in the Corporate Governance Report, annexed as Annexure A to this Report.

Pursuant to Rule 3 & Rule 4 of the Companies (Meetings of Board and its Powers) Rules, 2014, majority of the Board meetings and Committee meetings were held through Video Conference or Other Audio-Visual Means, in compliance with the said rules.

Board meeting dates are finalized in consultation with all Directors and agenda is backed up with comprehensive notes and detailed background information, which are circulated well in advance before the date of Board meeting thereby enabling the Board to have effective discussion and take informed decisions. Detailed business and regulatory presentations are also made to apprise the Board on the important developments.

19. Declaration by Independent Directors

The Company has received declaration of independence from the Independent Directors as stipulated under Section 149(7) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, confirming that they meet the criteria of independence which has been duly assessed by the Board as part of performance evaluation of Independent Directors. Further, all the Independent Directors have confirmed that they have registered their name in the Independent Directors data bank maintained by the Indian Institute of Corporate Affairs. The Independent Directors have also confirmed that, if applicable, they shall undergo the proficiency test in accordance with Rule 6(4) of the Companies (Appointment and Qualification of Directors) Rules, 2014.

The Independent Directors have complied with the Code for Independent Directors prescribed in Schedule IV of the Companies Act, 2013.

20. Independent Directors Meeting

As per Schedule IV of the Companies Act, 2013, Secretarial Standards-1 on Board Meetings (‘SS-1) and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, during FY21, a meeting of the Independent Directors was held on October 16, 2020, to discuss inter-alia the performance evaluation of the Board, its Committees, Chairman and the individual Directors, assessment of information flow from Management to the Board and evaluation and self-assessment of the training requirements of Independent Directors.

21. Board of Directors Performance Evaluation

Similar to the previous financial year, to maintain independence and confidentiality, the performance evaluation process for FY21 was carried out with the help of an external agency in compliance with the provisions of the Companies Act, 2013 and Regulation 17(10) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. An online annual evaluation of Board, Board Committees, Chairman and individual Directors was carried out on the basis of criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc. It also covered specific criteria and the grounds on which all Directors in their individual capacity were evaluated including fulfillment of the independence criteria for Independent Directors as laid under the Companies Act, 2013 and the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015. The online evaluation also included self-assessment of the training requirements by the Directors.

The above criteria are based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India.

The performance evaluation of the Board, its Committees, Chairman and Directors was also reviewed by the Independent Directors at their meeting held on May 3, 2021 and Nomination and Remuneration Committee and the Board of Directors, at their respective meetings held on May 4, 2021, which showcased the strengths of the Board and areas of improvement from current evaluation in comparison to the evaluation findings of FY20. The observations made during FY20 were acted upon appropriately.

Overall the Board expressed its satisfaction on the performance evaluation process as well as performance of all Directors, Committees and Board as a whole.

Further, the performance evaluation included, evaluation of each individual members of the Board against the list of core skills/ expertise/ competences identified and approved by the Board of Directors, as are required in the context of Companys business which inter-alia included competence/ expertise in areas viz.

a) strategy and planning,

b) governance, legal, risk and compliance,

c) finance, accounts and audit,

d) information technology,

e) stakeholders engagement and industry advocacy,

f) client engagement,

g) contributor and collaborator and

h) global experience/international exposure.

The evaluation report revealed that the Board of Directors of the Company have optimal mix of skills/ expertise to function effectively. The mapping of board skills/ expertise vis--vis individual Directors is provided in the Corporate Governance Report, Annexure A to this Report.

22. Board Committees

In terms of the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has constituted Audit Committee, Stakeholders Relationship Committee, Nomination & Remuneration Committee, Corporate Social Responsibility (‘CSR) Committee and Risk Management Committee. Additionally, the Board has also constituted a Strategic Investment Committee and also there is Committee of Independent Directors. The details of each of the Committees comprising their composition, charter and details of meetings held during the year are provided in the Corporate Governance Report, Annexure A to this Report.

23. Corporate Social Responsibility (‘CSR)

The disclosures required to be given under Section 135 of the Companies Act, 2013 read with Rule 8(1) of the Companies (Corporate Social Responsibility Policy) Rules, 2014 and Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021 is provided in the Annual Report on CSR Activities for FY21, in Annexure D to this Report.

The CSR Policy of the Company is available on the Companys website, www.Lntinfotech.com/social-responsibility

24. Business Responsibility Report (‘BRR)

Pursuant to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, ‘Business Responsibility Report forms part as Annexure H to this Report, which describes the initiatives taken by the Company from an environmental, social and governance perspective.

25. Corporate Sustainability

As a fast-growing group company, LTI has inherited tenets of excellence in sustainability practices from Larsen & Toubro Limited, its Parent Company. We believe in conducting business sustainably through sound practices which are socially responsible and environment friendly. Through its community development programs, LTI works towards building resilience in underprivileged members of society. LTIs Sustainability framework leverages its core competencies to deliver greater and more sustainable impacts across its focus areas of Education, Empowerment and Environment. These are further set forth through specific objectives identified and commitments made through the sustainability roadmap. LTI has a holistic approach which can be seen through the commitments which are not only business focused, but also has equal emphasis on its employees, community and the environment at large. The objectives to achieve the desired results will in turn enhance our contribution to the overarching objectives of the United Nations Sustainable Development Goals.

The Sustainability reports are available on the Companys website, www.Lntinfotech.com/social-responsibility

26. Auditors

A. Statutory Auditor

M/s. B. K. Khare & Co. [ICAI Registration No. 105102W] were appointed as Statutory Auditors of the Company by the shareholders at the AGM held in 2017 for a period of 5 years from the conclusion of 21st AGM till the conclusion of 26th AGM of the Company, subject to ratification by the shareholders at every AGM. The requirement of ratification by the shareholders at every AGM has been dispensed with by the Companies (Amendment) Act, 2017, hence no resolution is being proposed for ratification of appointment of Statutory Auditors.

The Auditors Report to the shareholders on the audited standalone and consolidated financial statements of the Company for the year ended March 31, 2021 does not contain any qualification, observation or comment or remark(s) which has/have an adverse effect on the functioning of the Company and therefore does not call for any comments from Directors. Further, the Statutory Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Companies Act, 2013.

The Auditors have confirmed that they have subjected themselves to the peer review process of Institute of Chartered Accountants of India (‘ICAI) and hold valid certificate issued by the Peer Review Board of the ICAI.

The Auditors have also furnished a declaration confirming their independence as well as their arms length relationship with the Company and declared that they have not taken up any prohibited non-audit assignments for the Company.

Please refer to the Notes to accounts, for the total fees paid by the Company to Statutory Auditors for FY21, on a consolidated basis. Further, the Statutory Auditor is not providing any other service to any other group entity of the Company.

B. Secretarial Auditor

The Secretarial Audit Report issued by Ms. Naina R Desai, Practicing Company Secretary is annexed asAnnexure C to this Report. The Secretarial Auditors Report to the shareholders does not contain any qualification or reservation which has any material adverse effect on the functioning of the Company, except the observation/qualification w.r.t. non-fulfillment by March 31, 2021 of the vacancy created on cessation of term of office of an Independent Director on the Board of Directors of the Company with effect from the close of business hours of October 27, 2021.

The Nomination & Remuneration Committee had been successful in finalizing one person for the position of Independent Director who possessed the core skills/ expertise/ competencies as required in the context of Companys business, however, the appointment could not be considered as certain clearances required prior to the appointment were pending.

Further, the Nomination & Remuneration Committee is still evaluating potential candidates for the position of an Independent Director, however, due to surge in the second wave of Covid-19 pandemic, it has been very difficult to have physical one-to-one meetings with the identified candidates for closing the open position.

The Board and Nomination & Remuneration Committee are conscious of its compliance and governance obligations under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and are making all possible efforts to finalize and fill the vacancy at the earliest.

27. Consolidated Financial Statements

The Consolidated Financial Statements pursuant to Section 129(3) of the Companies Act, 2013, prepared in accordance with the Accounting Standards prescribed by the Institute of Chartered Accountants of India, forms part of this Integrated Annual Report.

28. Adequacy of Internal Financial Controls

The Company has designed and implemented a process driven framework for Internal Financial Controls (‘IFC) within the meaning of the explanation to Section 134(5)(e) of the Companies Act, 2013. For the year ended March 31, 2021, the Board is of the opinion that the Company has sound IFC commensurate with the nature and size of its business operations and are operating effectively and no material weaknesses exist. Further, the Company has a process in place to continuously monitor the same and identify gaps, if any, and implement new and/or improved controls wherever the effect of such gaps would have a material effect on the Companys operations.

29. Risk Management

The Company has formulated a risk management policy and has in place a mechanism to inform the Board Members about risk assessment and minimization procedures and periodical review to ensure that executive management controls risk by means of a properly designed framework. A detailed note on risk management along with the measures taken by the Company under the current COVID-19 global pandemic is given in Management Discussion & Analysis/ Integrated Report section forming part of this Annual Report.

30. Whistle Blower Mechanism

The Whistle Blower Policy of the Company meets the requirement of the Vigil Mechanism framework prescribed under the Companies Act, 2013 (‘Act). Whistle-Blower Policy and Guidelines on Vigil Mechanism are available on the Companys website, www.Lntinfotech.com/Investors

The Whistle Blower Policy encourages and facilitates the employees to report concerns about unethical behavior, actual/ suspected frauds and any wrongdoings or unethical or improper practice. Further, to strengthen the Vigil Mechanism framework of the Company and to ensure timely and efficient redressal of complaints, ‘Guidelines on Vigil Mechanism are put in place laying out procedures and process flow for investigations to be conducted. The Policy also provides for adequate safeguards against victimisation of a Whistle Blower. The Audit Committee of the Company quarterly reviews complaints received under the Vigil Mechanism and during the year, no employee was denied access to the Audit Committee or its Chairman.

31. Related Party Transactions

The Audit Committee and the Board of Directors have approved the Related Party Transactions Policy including clear threshold limits and the same is available on the Companys website, www.Lntinfotech.com/Investors

During FY21, the Company has further strengthened the controls and approvals for related party transactions through automating the tracking and monitoring of related party transactions. All the related party transactions, during FY21, were in the ordinary course of business and at arms length and were prior approved and duly reviewed by the Audit Committee as required under the provisions of Section 177 of the Companies Act, 2013 and Regulation 23 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

Related party transactions during FY21, were in compliance with the Companies Act, 2013, SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and Accounting Standard and are disclosed in the notes forming part of the financial statements. Further, there were no material related party transactions during FY21, requiring shareholders approval.

32. Subsidiary/ Associate/ Joint Venture Companies

As on March 31, 2021, the Company has 27 subsidiaries. During the year under review, there were following material changes:

A. Incorporation:

The Company incorporated following wholly-owned subsidiaries:

(i) Larsen & Toubro Infotech UK Limited, incorporated in UK on August 17, 2020, with an investment amount of GBP 1,000 towards equity share capital.

(ii) LTI Middle East FZ-LLC, incorporated in Dubai on November 25, 2020, with an initial investment amount of AED 10,000 towards equity share capital. Additionally, the Company has made an investment of AED 1,850,000 in February 2021, towards equity share capital.

B. Amalgamation:

The Board of Directors of Syncordis Software Services India Private Limited (‘Syncordis) and Ruletronics Systems Private Limited (‘Ruletronics), wholly owned subsidiaries of the Company at their respective meetings held on September 28, 2020 and the Board of Director of the Company at its meeting held on October 20, 2020, approved the Scheme of Amalgamation (‘Scheme) between Syncordis and Ruletronics with the Company under Sections 230-232 of the Companies Act, 2013 (‘hereinafter referred as Petitioners). The Company Scheme Petition filed by the Petitioners with Honble National Company Law Tribunal (‘NCLT), Mumbai Bench on January 22, 2021 was admitted by NCLT on April

8, 2021. The appointed date for the proposed Scheme is April 1, 2021.

C. Merger of Nielsen+Partner S.A (N+P Luxembourg) with Syncordis S.A. (Syncordis Luxembourg)

During the year, N+P Luxembourg was merged with Syncordis Luxembourg, with effect from December 21, 2020 and pursuant to the common terms of merger and purchase consideration, Syncordis Luxembourg issued shares to Nielsen+Partner GmbH, sole shareholder of N+P Luxembourg, resulting in increase in the share capital of Syncordis Luxembourg from EUR 34,800 to EUR 55,392.

D. Buy Back by Larsen And Toubro Infotech South Africa Pty Limited

During FY21, Larsen And Toubro Infotech South Africa Pty Limited (‘South Africa subsidiary) made an offer of buyback, of which 77,600 shares were accepted by the Company, resulting in disinvestment of Companys shareholding from 74.9% to 69.58% in its South Africa subsidiary.

In line with Regulation 16(c) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, the Company has a policy on the identification of material subsidiaries, which is available on the Companys website, www.Lntinfotech.com/Investors. Based on same, there are no material subsidiaries of the Company as on March 31, 2021.

A statement containing the salient features of the financial statement of subsidiaries/ associate/ joint venture companies as per form AOC-1 is annexed as Annexure F to this Report. Further, pursuant to the provisions of Section 136 of the Act, the standalone financial statements and consolidated financial statements of the Company along with relevant documents and separate audited financial statements in respect of subsidiaries are available on the Companys website, www.Lntinfotech.com/Investors

33. Particulars of Loans given, Investments made, Guarantees given or Security provided

Details of loans given, investments made or guarantees given or security provided, if any, covered under the provisions of Section 186 of the Companies Act, 2013 and Regulation 34(3) read with Schedule V of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 are given in the notes forming part of the financial statements provided in this Integrated Annual Report.

34. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

Information as per Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 relating to conservation of energy, technology absorption, foreign exchange earnings and outgo is given in Annexure G to this Report.

35. Compliance with Secretarial Standards on Board Meetings and General Meetings

The Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Board Meetings and General Meetings.

36. Compliance Monitoring System

At LTI, ensuring regulatory compliance and adherence to standards is of utmost importance. The Company ensures that appropriate business processes and adequate tools are in place for adherence with all the statutory obligations. Regulatory Compliances which are applicable to LTI globally, are monitored/ tracked through an in-house web-based tool. Audit Committee, on quarterly basis reviews status of compliances and quarterly a certificate is presented to the Board of Directors at its meetings confirming status of compliances along with remediation plan for non-conformities, if any. Any amendments in the laws applicable to the Company are also reviewed, updated in the system and monitored by the Company. The Company also engages external consultants to review and update the compliance requirements for new geographies and also update the existing list of compliances applicable globally to LTI. Audit assurance on the Compliance Management is sought on regular basis through Companys Internal Audit team.

Further, the Company has put in place a framework on "Global Corporate Compliances" which outlines the Companys philosophy towards compliance culture, understanding compliances, coverage, approach, responsibilities, reporting matrix and trainings. The framework focuses on taking up compliance as an integral element for conducting business and create corporate culture characterized with integrity and law-abiding behavior. Under this framework, identified key stakeholders across business units, corporate functions and geography heads, ensure and confirm compliance with the provisions of all applicable laws on a continuous basis.

During FY21, Company has further enhanced its mechanism to monitor Sanctions Compliance by developing an in-house tool to monitor the same. Further, various organization level policy document and training modules for Anti Money Laundering, Export control regulations were reviewed and upgraded to ensure full compliances on the same.

37. Prevention of Sexual Harassment at Workplace

LTI is committed to provide a safe, secure and congenial work environment for all its employees that is free from sexual harassment. The Company has formulated a robust POSH (Prevention of Sexual Harassment at Workplace) policy with clear guidelinesforreportingactsofSexualHarassmentattheworkplace and procedures for resolution and redressal of complaints of Sexual Harassment. This Policy is in line with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, and in fact goes beyond to make it gender-neutral and applicable to every employee in the organization.

The Policy is available on the website of the Company at www.Lntinfotech.com/investors

Awareness sessions as well as communication campaigns are conducted at regular intervals to promote a safe space for all genders and to sensitize employees in this space. Besides that, the training program on POSH has been made mandatory for all employees annually across the globe.

During FY21, the Company received two complaints on sexual harassment. All such complaints have been resolved with appropriate action taken by the Internal Complaints Committee, with no complaints pending at the end of FY21.

38. Company Policy on Director Appointment and Remuneration

Nomination and Remuneration Policy lays out role of NRC on Directors appointment and remuneration including recommendation of remuneration of the key managerial personnel and other employees and the criteria for determining qualifications, positive attributes and independence of a Director. The NRC policy is available on the Companys website, www.Lntinfotech.com/Investors

Some of the salient features of NRC Policy are as follows:

1. To regulate the appointment and remuneration of directors, key managerial personnel and the senior management personnel;

2. To identify persons who are qualified to become directors as per the criteria/ Board skill matrix identified by the Board;

3. To ensure proper composition of Board of Directors and Board diversity;

4. To ensure that level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors, key managerial personnel and senior management and their remuneration involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to Companys working and its goals.

39. Statement under Section 197 of the Companies Act, 2013

The information as required under Section 197(12) of the Companies Act, 2013 (‘Act) and Rule 5(1) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, is provided in Annexure E to this Report.

The details of employees receiving remuneration as mentioned in Rule 5(2) & 5(3) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time is provided in Annexure I to this Report. In terms of Section

136(1) of the Act and the rules made thereunder, the Report and Accounts are being sent to the shareholders excluding the aforesaid Annexure. Any shareholder interested in obtaining copy of the same may send an email to the Company Secretary and Compliance Officer at investor@Lntinfotech.com None of the employees listed in the said Annexure are related to any Director of the Company.

40. Annual Return

The copy of annual return is available on the Companys website, www.Lntinfotech.com/Investors

41. Employee Stock Option Schemes

The Company has in place an Employee Stock Option Scheme 2015 (‘ESOP Scheme 2015) to attract and retain talent. There has been no material change in the ESOP Scheme 2015 during FY21. The ESOP Scheme 2015 is in compliance with the Companies Act, 2013 and SEBI (Share Based Employee Benefits) Regulations, 2014 and the disclosure relating to the ESOP Scheme 2015 as required under SEBI (Share Based Employee Benefits) Regulations, 2014 is available on the Companys website, www.Lntinfotech.com/Investors

A Certificate obtained from the Statutory Auditors, confirming compliance with the Companies Act, 2013 and SEBI (Share Based Employee Benefits) Regulations, 2014 is provided as Annexure B to this Report.

42. Details of significant and material orders passed by the Regulators or Courts or Tribunals

During FY21, there were no material and significant orders passed by the regulators or courts or tribunals impacting the going concern status and the Companys operations in future.

43. Green Initiative

Electronic copy of the Integrated Annual Report for FY21 and the Notice of the ensuing AGM is being sent to all shareholders whose email addresses are available in demat account and registered with Companys Registrar and Share Transfer Agent. Shareholders holding shares in demat form are requested to update their email addresses with their Depository Participant(s) and for shareholders holding shares in physical form, should get their email registered/ updated with Link Intime India Private Limited, Companys Registrar and Share Transfer Agent.

44. Acknowledgements

The Directors thank the Companys customers, vendors, banks, financial and academic institutions, employees, regulatory authorities, stock exchanges and all other stakeholders for their continued co-operation and support. The Directors also acknowledge the support and co-operation from the Government of India and overseas, its agencies and other regulatory authorities. The Directors also wish to place on record their appreciation towards employees of the Company and its Group for their commendable efforts, teamwork and professionalism.

For and on behalf of the Board
Sanjay Jalona Nachiket Deshpande
Chief Executive Officer & Chief Operating Officer &
Managing Director Whole-time Director
(DIN: 07256786) (DIN: 08385028)
Place: USA Place: Pune
Date: May 04, 2021