Oscar Investments Ltd Directors Report.

To,

The Members,

Oscar Investments Limited

Your Directors have immense pleasure in presenting this 40th Annual Report along with Audited Financial Statements for the financial year ended March 31, 2018.

FINANCIAL HIGHLIGHTS

The brief highlights of Standalone and Consolidated financial results of the Company for the Financial Years 2017-18 and 2016-17 are as under:

Standalone Financial Result:

(Rs in Lacs)
Particulars March 31, 2018 March 31, 2017
Income
Revenue from operations 193.52 28,126.49
Other Income 82.03 34.11
Total Revenue 275.55 28,160.60
Expenditure
Employee benefit expenses 84.10 118.74
Finance cost 8955.41 10,696.69
Depreciation & amortization expenses 14.01 26.66
Other expenses 2474.70 12,593.31
Provisions and loan losses 96,409.26 (3,979.18)
Total Expenses 107,937.48 19,456.22
Profit /(Loss) before exceptional items and Tax (107,661.93) 8,704.38
Exceptional Items
Provision for Litigation/Arbitration Claims 51,829.19 -
Profit /(Loss) after exceptional items and before Tax (159,491.12) 8,704.38
Tax Expenses
- Current Tax - 1,055.00
- Mat Credit Entitlement - (1,055.00)
- Prior year- expenses/ (reversal of provision) (47.84) -
Deferred Tax 0.47 (5.38)
Wealth Tax - -
Profit /(Loss) for the year (159,443.75) 8,709.76
Earning per equity share of Rs 10/- each
Basic (Rs) (922.67) 50.40
Diluted (Rs) (922.67) 50.40

Consolidated Financial Result:

(Rs in Lacs)
Particulars March 31, 2018 March 31, 2017
Income
Revenue from operation 193.52 28134.49
Other Income 82.26 41.99
Total Revenue 275.78 28,176.48
Expenditure
Cost of Material consumed - -
Employee benefit expense 84.10 118.82
Finance cost 8,956.79 10,697.08
Depreciation & amortization expenses 14.01 26.66
Other expenses 2,676.54 12,658.98
Provisions and loan losses 102,281.76 (3,979.18)
Total Expenses 114,013.20 19,522.36
Profit /(Loss) before exeptional items and Tax (113,737.42) 8,654.12

 

Particulars March 31, 2018 March 31, 2017
Exceptional Items
Provision for Litigation/Arbitration Claims 51,829.19 -
Profit /(Loss) after exceptional items and before Tax (165,566.61) 8,654.12
Tax Expenses
- Current Tax - 1,057.43
- Deferred Tax 0.47 (5.39)
- Prior year- expenses/ (reversal of provision) (47.84) 1.42
MAT Credit Entitlement - (1,055.00)
Profit /(Loss) after Tax and before minority interest (165,519.24) 8,655.66
and share in associate
Less: Share of Profit /(Loss) Transferred to minority (1,635.47) (13.47)
Add: Share of Profit/ (Loss) of associate (48,268.78) 145.65
Profit /(Loss) for the year (212,152.55) 8,814.78
Earning per equity share of Rs 10/- each
Basic (Rs) (1227.69) 51.01
Diluted (Rs) (1227.69) 51.01

BUSINESS PERFORMANCE

Consolidated

During the financial year 2017-18, the Company recorded loss after exceptional items and before Tax of Rs. 165,566.61 lacs. The loss after Tax and before minority interest and share in associate was Rs. 165,519.24 lacs as compared to the profit after Tax and before minority interest and share in associate of Rs. 8,655.66 lacs in the previous year and the loss for the year is Rs. 212,152.55 lacs as compared to profit of 8,814.78 lacs in the previous year.

Standalone

During the financial year 2017-18, the Company recorded loss before exceptional items and Tax of Rs 107,661.93 lacs. The loss after exceptional items and before Tax was Rs 159,491.92 lacs as compared to the profit after exceptional items and before tax of Rs 8,704.38 lacs in the previous year and the loss for the year is Rs. 159,443.75 lacs as compared to profit of 8,709.76 lacs in the previous year.

No amount was transferred to Statutory Reserve Fund pursuant to Section 45(I) C of the Reserve Bank of India Act, 1934 for the year ended March 31,2018. The Companys Net Worth as on March 31, 2018 stood at Rs. 14,747.80 lacs as against Rs 174,191.09 lacs last year.

MANAGEMENT DISSCUSSION AND ANALYSIS REPORT

a. Global Economy and Industry Overview

World growth strengthened in 2017 to 3.8 percent, with a notable rebound in global trade. It was driven by an investment recovery in advanced economies, continued strong growth in emerging Asia, a notable upswing in emerging Europe, and signs of recovery in several commodity exporters. Global growth is expected to tick up to 3.9 percent this year and next, supported by strong momentum, favorable market sentiment, accommodative financial conditions, and the domestic and international repercussions of expansionary fiscal policy in the United States.

At 3.8 percent, global growth last year was percentage point faster than in 2016 and the strongest since 2011. Two-thirds of countries accounting for about three-fourths of global output experienced faster growth in 2017 than in the previous year (the highest share of countries experiencing a year-over-year growth pickup since 2010). The preliminary outcome for global growth in 2017 was 0.2 percentage point stronger than forecast in the October 2017 World Economic Outlook (WEO), with upside surprises in the second half of 2017 in advanced as well as emerging market and developing economies.(Source IMF Report April,2018) b. Outlook

According to IMFs World Economic Outlook Update, Growth in India is projected to increase from 6.7 percent in 2017 to 7.4 percent in 2018 and 7.8 percent in 2019, lifted by strong private consumption as well as fading transitory effects of the currency exchange initiative and implementation of the national goods and services tax. Over the medium term, growth is expected to gradually rise with continued implementation of structural reforms that raise productivity and incentivize private investment.

As per World Bank Report ,Indias recent reforms, such as the "Make in India" initiative and demonetization, are expected to encourage formal sector activity, broaden the tax base, and improve long-term growth prospects despite short term disruptions in the case of demonetization.

The July 2017 introduction of the Goods and Services Tax (GST) in India has caused temporary disruptions in manufacturing, and is linked to the recent weakness in the Purchasing Managers Index and industrial production growth. However, eventually, it is expected to simplify tax compliance, deepen economic linkages between Indian states, broaden the tax base and improve revenue collections. In turn, this is expected to enhance the broader business environment and help foster investment and employment (IMF 2017).

The Indian Economy posted a growth rate of 7.7 percent during the January to March 2018 Quarter, enabling the country to retain its position as the fastest growing major economy, as per data released by Central Statistical Office. However, for the fiscal year that ended March 31, Indias growth rate works out to 6.7 per cent, down from 7.1 per cent in 2016-17.

The countrys financial services sector consists of the capital markets, insurance sector and non-banking financial companies (NBFCs). The financial services industry is highly correlated to overall economic growth, and as seen from the sectoral split of Indias GDP growth, it has in fact been a large driver of this growth. The improving GDP growth trajectory is therefore expected to further propel the financial services industry.

c. Risks And Concerns

The Company is subject generally to changes in Indian law, as well as to changes in government regulations, changes made in the regulations by applicable regulators in India and policies and accounting principles. Any changes in the regulatory framework affecting non-banking financial companies, could adversely affect the profitability of the Issuer or its future financial performance, by requiring a restructuring of its activities, increasing costs or otherwise. The Company is also subject to interest rate risks and credit risks.

d. Internal Financial Control Systems and their adequacy

The Company has proper and adequate internal financial control systems commensurate with its size and nature of its operations. These have been designed to ensure that the financial and other records are reliable for preparing financial and other statements, maintain accountability of assets, complying with applicable statutes, safeguarding assets from unauthorized use, executing transactions with proper authorization and ensuring compliance of corporate policies.

e. Financial Overview of the Company

The total revenue of the Company on standalone basis for the Financial Year 2017-18 was Rs. 275.55 lacs as against Rs. 28,160.60 Lacs in Financial Year 2016-17. During the financial year 2017-18, the Company incurred a loss after exceptional items and before Tax of Rs. 1,59,491.12 Lacs as compared to a profit before tax of 8,704.38 lacs in the last year. The loss after Tax was Rs. 1,59,443.75 lacs as compared to the profit of Rs. 8709.76 lacs in the previous year.

f. Human Resources - Contribution to Business Success

HR policies and processes were strengthened with focus on building a culture where high performance is suitably rewarded. Adherence to various HR policies, alignment to organizational culture and values and efficacy of organisation structure are monitored and supported by the group HR leadership for superior business performance and higher employee engagement and satisfaction levels. Our continuous attempt has been to provide employees with challenging roles, opportunities for learning and growth, an enabling work environment, relevant training and performance support through various existing and new HR initiatives.

DIVIDEND AND TRANSFER TO RESERVE

In view of losses in the Company, the Board of Directors has decided not to recommend any dividend for the financial year ended March 31,2018.

No amounts were transferred to reserves.

SHARE CAPITAL

During the period under review, there has been no change in the Share Capital of the Company.

During the Financial Year, no funds were raised by way of public issue, rights issue, preferential issue etc. by stating any object in the offer document or explanatory statement to the notice for the general meeting. Therefore, no explanation is required to be given in this report pursuant to Regulation 32(4) of SEBI LODR Regulations.

EXTRACT OF ANNUAL RETURN

The Annual Return extract in Form No. MGT 9 as required to be prepared in terms of Section 92(3) of the Act is being uploaded on the website of the Company and can be accessed through the link: oscarinvestments.org/invester/annualreturn/2017-18. The same is also annexed herewith as Annexure I.

DETAILS OF SUBSIDIARIES/JOINT VENTURES/ASSOCIATE COMPANIES AND REPORT ON THE PERMORMANCE AND FINANCIAL POSITION

As on March 31, 2018, your Company has one subsidiary; Shimal Research Laboratories Limited and one step-down subsidiary; Fortis Clinical Research Limited. The Company has one Associate Company; RHC Finance Private Limited within the meaning of Section 2(6) of the Companies Act, 2013 ("Act"). During the Financial year under review, there has been no material change in the nature of business of the subsidiaries.

A report on the performance and financial position of each of the subsidiaries included in the Consolidated Financial Statement is provided, in accordance with the provisions of Section 129 of the Act read with Rule 5 of the Companies (Accounts) Rules, 2014, as a separate statement in Form AOC- 1, annexed to the Consolidated Financial Statements of the Company, containing the salient features of the financial statement of Companys subsidiaries and hence is not repeated here for sake of brevity.

The Board of Directors have also formulated a Policy on Subsidiaries which has also been uploaded on the Companys website and can be accessed through the link http://oscarinvestments.org/pdf/Policy-on-Subsidiaries.pdf Pursuant to the provisions of Section 136 of the Act, the Financial Statements including Consolidated Financial Statements of the Company along with other documents required to be attached thereto and separate audited accounts in respect of each of its subsidiaries are available on the website of the Company.

STATUTORY DISCLOSURES

None of the Directors of your Company is disqualified as per provision of Section 164(2) of the Act as on March 31, 2018. The directors of the Company have made necessary disclosures, as required under various provisions of the Act and SEBI LODR Regulations.

CONSOLIDATED FINANCIAL STATEMENT

Pursuant to Regulation 34 of the SEBI Listing Regulations and Section 129 of the Act,Consolidated Financial Statements of the Company and all its subsidiaries, duly audited by the Statutory Auditors of the Company, is published in this Annual Report. The Consolidated Financial Statements are prepared in terms of the Accounting Standards as per Companies (Accounting Standard) Rules, 2006 and referred to in Sections 129 & 133 of the Act.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

The Company being an NBFC, is exempted from the provisions of Section 186 [except sub-section (1)] of the Act. Accordingly, details of particulars of loans, guarantees or investments as required to be provided as per Section 134(3)(g) of the Act are not provided.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

The related party transactions that were entered into during the financial year were generally in ordinary course of business and on arms length basis except as provided in the Auditors Report and also referred in the Form AOC- 2 which is annexed to this report.

Except as above, there were no materially significant transactions with related parties in the financial year which were in conflict with the interest of the Company.

The Related Party Transactions are placed before the Audit Committee for approval as required under Regulation 23 of Listing Regulations and per the Related Party Transaction Policy of the Company as approved by the Board. Prior omnibus approval of the Audit Committee is obtained for the transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee for their approval on a quarterly basis.

Further, the Company has also taken approval from shareholders of the Company at the last Annual General Meeting held on September 29, 2017 for entering into Related party Transactions in terms of Section 188 of the Companies Act and the rules made thereunder read with Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The policy on Related Party Transactions has also been uploaded on the Companys website and can be accessed through the link http://www.oscarinvestments.org/pdf/Oscar-RPT-Policy.pdf.

Disclosures as required under Section 134(3)(h) read with Rule 8(2) of the Companies (Accounts) Rules, 2014, are provided in Form AOC- 2 which is annexed herewith as Annexure A and forms part of this report.

RISK MANAGEMENT

As an NBFC, the Company is exposed to credit risk, liquidity risk and interest rate risk. The Company has a Risk Management Policy, which is being monitored by the Risk Management Committee.

Companys Asset-Liability Committee (ALCO) set up in line with the guidelines issued by the RBI, monitors asset-liability mismatches, and ensures that there are no material imbalances or excessive concentration on either side of the balance sheet. The company manages the risk by maintaining a conservative financial profile and by following prudent business and risk management practices.

The details of the Committee are set out in the CGR forming part of the Boards Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In terms of the provisions of Section 152 of the Act and Article of Association of the Company, Mr. Shivinder Mohan Singh, Non-Executive Director, is liable to retire by rotation at the ensuing Annual General Meeting of the Company and being eligible has offered himself for re-appointment. The Nomination and Remuneration Committee and the Board of Directors recommend his re-appointment.

Mr. Ravi Sikka (Non-Executive Independent Director), Mr. Varun Sood (Managing Director) and Dr. Preetinder Singh Joshi (Non-Executive Independent Director) have stepped down from the Board w.e.f. August 17, 2017, February 20, 2018 and April 11, 2018 respectively.

Mrs. Aditi Shivinder Singh (Non-Executive Director) has resigned from the Board of Directors w.e.f. June 08, 2018.

The Board of Directors placed on record their appreciation for the valuable services and guidance provided by them during their tenure as Directors of the Company.

The Board of Directors, on the recommendation of the Nomination & Remuneration Committee (Committee) appointed Mr. Prakash Mishra and Mrs. Kiran Sharma as Additional Directors in the category of Non-Executive Independent Directors on August 14, 2018 and they hold office upto the date of the ensuing Annual General Meeting.The Board of Directors and the Committee have proposed to appoint Mr. Prakash Mishra and Mrs. Kiran Sharma as Directors of the Company at the ensuing Annual General Meeting.

The brief resume of the Directors proposed to be appointed/ re-appointed, nature of their expertise in specific functional areas, names of companies in which they hold directorships, memberships/chairmanships of board committees and shareholding (both own or held by/ for other persons on a beneficial basis) in the Company, as stipulated under Regulation 36(3) of the Listing Regulation, are provided in the Notice convening the Annual General Meeting of the Company.

During the year, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company.

The Company has received declarations from all the Independent Directors of the Company that they meet with the criteria of independence as provided in Section 149(6) of the Act and Regulation 16 of the Listing Regulations.

Mr. Vivek Kumar Singh, Company Secretary of the Company has resigned with effect from September 14, 2017

BOARD/COMMITTEE COMPOSITION AND MEETINGS

The Board of Directors of the Company met Five (5) times during the financial year 2017-18. The details of composition of Board and Committees and their meetings held during the year are provided in the Report on Corporate Governance, which forms part of this report. The intervening gap between two meetings of the Board was within the period as prescribed under the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and SEBI Listing (Obligation & Disclosure Requirements) Regulation, 2015, the Board has carried out performance evaluation of its own performance, the Directors individually, Chairman as well as the evaluation of the working of its Audit Committee, Nomination and Remuneration Committee (NRC), Stakeholders Relationship Committee and Corporate Social Responsibility Committee. Following process of evaluation was followed:

S. No. Process Remarks
1. Individual Self- Assessment Self-evaluation forms were shared and completed by the Directors and submitted to the Chairperson of Nomination and Remuneration Committee.
2. One to One discussion An independent Advisor was authorised to interact with each member to assess performance, invite direct feedback and seek inputs to identify opportunities for improvement
3. Board Evaluation for the Board, Nomination and Remuneration Committee and of Independent Directors Using the Self-Assessment feedback and output from the one-on-one discussions the formal Board Evaluation Process was conducted. A compilation of the individual self-assessments and one to one discussions were placed at the meeting of the Nomination and Remuneration Committee (NRC, the Independent Directors (IDs) and the Board of Directors (BoD), held on February 14, 2018 for them to review and include as additional feedback to the formal process completed in the meetings.
4. Final recording and reporting Based on the above, a final report on Board Evaluation was collated, presented presented and tabled at a meeting of the Board of Directors. The report also noted best practices in certain areas and considered opportunities for improvement.

SCHEME OF AMALGAMATION BETWEEN HEALTHFORE TECHNOLOGIES LIMITED AND OSCAR INVESTMENTS LIMITED AND THEIR RESPECTIVE SHAREHOLDERS AND CREDITORS

The Board of Directors of Oscar Investments at their meeting held on December 14, 2015 had approved the Scheme of Amalgamation (the Scheme) between HealthFore Technologies Limited (HealthFore or the Amalgamating Company) and Oscar Investments Limited (Oscar or Amalgamated Company) and their respective shareholders and creditors, under Sections 391 to 394 and other applicable provisions of the Companies Act, 1956.

The Board of Directors have withdrawn the Scheme in view of ongoing Daiichi Litigation, which includes the Company as a party.

UPDATE ON DAIICHI MATTER

The Honble Supreme Court vide its interim order dated August 11, 2017, in the matter relating to M/s Daiichi Sankyo Company Limited v/s Oscar Investments Limited & Others, directed that status quo as on date with regard to shareholding of M/s Fortis Healthcare Holdings Private Limited, one of the Promoter Group Entity in Fortis Healthcare Limited (listed on the National Stock Exchange of India and BSE Limited) be maintained and further on August 31, 2017 clarified that the directions relating to maintaining of status quo applies for both the encumbered and unencumbered shares.

Further in the matter relating to M/s Daiichi Sankyo Company Limited v/s Malvinder Mohan Singh & Others ("respondents"), which includes Oscar Investments Limited ("Company") as a party, Honble Delhi High Court vide its order dated January 31, 2018, directed the enforcement of Arbitration Award dated 29th April,2016 passed by Arbitration Tribunal in Singapore for an amount of INR 2562.78 Crore along with quantified interest,cost and expenses of Arbitration till the date of Award .

The Honble Supreme Court of India had on February 15,2018, clarified that the direction to maintain status quo shall not apply to shares of FHL held by FHHPL as may have been encumbered on or before the interim orders dated August 11, 2017 and August, 31, 2017.

The necessary intimation in this regard, pursuant to Regulation 30 of of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 has also been filed with BSE Limited.

REMUNERATION POLICY

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for appointment of Directors, Key Managerial Personnel and their remuneration as well as policy on other employees remuneration. The detailed policy is available on the website of the Company can be accessed through the link http://oscarinvestments.org/pdf/DIRECTORS-APPOINTMENT-&-REMUNERATION-POLICY.pdf. The Remuneration Policy is stated in the Corporate Governance Report.

MAINTENANCE OF COST RECORDS

The Company is in the financial service industry. In view of the nature of activities which are being carried by the Company, the maintenance of cost records as specified by the Central Government under subsection (1) of Section 148 of the Act is not applicable on the Company and hence such accounts and records are not maintained.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

No amount was required to be transferred to Investor Education and Protection Fud, during the year under review.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Company has laid down a policy on training for Independent Directors. The Directors are updated on the regulatory changes, Business strategy and operations by the senior leadership of the Company periodically. Apart from this, during the year under review one familiarization program was conducted by respective functional heads of the Company to familiarize the Directors with the business model of Research & Information Services.

Details of Familiarization Program conducted are uploaded on the website of the Company and can be accessed through the link http://oscarinvestments.org/pdf/Familiarisation-programme-for-Independent-Directors.pdf

AUDIT COMMITTEE

The details of composition of Audit Committee and mentioned in the Corporate Governance Report. As on the date of this report, the composition of the Audit Committee is in compliance with provisions of the Companies Act, 2013 and SEBI LODR Regulations. During the year, all the recommendations of the Audit Committee are included in the Report on Corporate Governance, which forms part of this report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134 (5) of the Companies Act, 2013, the Board of Directors, based on the representation as provided to the Board by the management, confirm that:

a. In the preparation of the annual accounts for the financial year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanations relating to material departures, wherever applicable;

b. The Directors had selected such accounting policies and applied them consistently and made judgements 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 at March 31, 2018;

c. The Directors had 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;

d. The Directors had prepared the annual accounts for the financial year ended March 31, 2018 on a going concern basis;

e. The Directors had laid down internal financial controls to be followed by the Company and such internal controls are adequate and were operating effectively; and

f. The Directors had devised proper systems to ensure proper compliance with provisions of all applicable laws and that such systems were adequate and operating effectively.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

In compliance with Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules 2014, the Company has established a Corporate Social Responsibility (CSR) Committee during the financial year 2014-2015.

The CSR Committee has formulated and recommended to the Board, a CSR Policy indicating the activities to be undertaken by the Company, which has been approved by the Board.

The Company has spent an amount of Rs. 72 Crore towards the CSR projects during the current financial year 2017-18.The average net profit of the Company computed as per Section 198 of the Act, during the three immediately preceding financial years was Rs. 3599.75 Lacs .It was hence required to spend Rs.71.99 Lacs on CSR activities during the financial year 2017-18 ,being 2% of the average net profits of the three immediately preceding financial years.

Annual Report on CSR in format prescribed in companies (Corporate Social Responsibility Policy) Rules, 2014 in attached as Annexure B.

CORPORATE GOVERNANCE

Your Company believes that Corporate Governance is the basis of stakeholder satisfaction and therefore, your Board continues to be committed to uphold the highest standards of Corporate Governance and adhere to the requirements set out by the Securities and Exchange Board of India.

A detailed Report on Corporate Governance along with the Auditors Certificate, confirming the compliance to the conditions of Corporate Governance as stipulated in Part C of Schedule V of the Listing Regulations is set out in this Annual Report and forms an integral part of this Report.

The members may please note that for the financial year ended March 31, 2018 finalisation of annual audited accounts had taken more than anticipated time. The Company was not able to declare its audited financial results within the prescribed timelines under SEBI LODR Regulations. The Company declared its audited financial results on 06th June, 2018.

BSE, vide its communication dated 18th June, 2018 had levied the fine of Rs. 41,300/- For delated submission of financials for the period ended March 31, 2018. The Company has paid the fine.

AUDITORS

M/s M.S. Sekhon & Co., (Firm Registration No. 003671N), Chartered Accountants who are the Statutory Auditors of the Company hold office till the conclusion of the AGM of the Company to be held in the year 2021 as per shareholders resolution dated September 30, 2016 subject to ratification of their appointment by the Members at every AGM as per the provisions of Section 139(1) of the Companies Act, 2013.

The Company has received a written confirmation from M/s M.S. Sekhon & Co., to the effect that their ratification, if made, would be within the prescribed limit under Section 141(3)(g) of the Act and they are not disqualified from being auditors of the Company.

Based on recommendation of the Audit Committee, the Board of Directors of the Company recommends the ratification of appointment of M/s M.S. Sekhon & Co., as statutory auditors of the Company from the conclusion of the forthcoming AGM till the conclusion of the next AGM to be held in the year 2019.

AUDITORS REPORT

Managements Response on the Statutory Auditors Qualification/Comments on the Companys Standalone and Consolidated Financial Statements

a. Qualification pertaining to non- provision for interest on short term borrowings from Related Parties

The Company borrowed from related and other lenders for further lending to related and other entities to meet their business requirements. During the year Honble Court in Daiichi Litigation imposed lot of restrictions on group entities as well as on the Company being one of the Respondents in the litigation. Moreover, there are other litigations going on which impacted the financials of group entities negatively and impacted their debt repayment capacity to the Company.

Due to non-service of interest and principal, the management provided almost all its loans and advances as NPAs in adherence to RBI guidelines issued from time to time, hence incurred huge losses in the Company during the year. In view of above, liability on account of Interest on borrowing amounting to Rs. 2,783.34 Lacs was not provided by the Company.

b. Qualification pertaining to non-provision of interest income on loans classified as Non-Performing Assets(Point No.1 of Emphasis of Matter and Sr. Nos. (iii) and (xiii) of Annexure A to Auditors Report)

During the year, the Company faced challenges in receipt of interest and principal amounts in view of the several challenges faced by the group companies emanating from the various legal issues faced by the group this year. Accordingly, the Company had to make adequate provisions in respect of Non-Performing Assets for loans and advances to various group companies and non-group companies, income on non-performing assets has not been recognized in the accounts in accordance with the guidelines issued by the Reserve Bank of India and based on best estimates of management.

c. Qualification pertaining to default in repayment of loan(Sr. no. (viii) of Annexure A to Auditors Report)

The Company availed secured loan of Rs. 56,500 Lacs from Yes Bank Ltd. for onward lending. During the year Honble Court in Daiichi Litigation imposed lot of restrictions on group entities as well as on the Company being one of the Respondents in the litigation. Due to such restrictions bankers and other financial institutions had stopped giving funds to the Company and the existing lenders recalled its loans for prevailing uncertainty in the litigations. Moreover, the Company faced challenges in receipt of interest and principal amounts in view of various litigations faced by the group companies. Accordingly, the Company had to make adequate provisions in respect of Non-Performing Assets for loans and advances to various group companies and non-group companies.

We are in discussion with the Bank to settle the loan through security already invoked by the Bank.

d. Point no. 2 of Emphasis of Matter pertaining to appointment of Company Secretary is self-explanatory and hence no comments in this regard have been offered by the Board of Directors.

DETAILS OF FRAUD REPORTABLE BY STATUTORY AUDITOR TO BOARD

Basis the confirmations reported to the Board in this regard, there were no instances of fraud, misfeasance or irregularity detected and reported in the Company during the financial year 2017-18 by the Statutory Auditors of the Company pursuant to Section 143(12) of the Companies Act, 2013.

SECRETARIAL AUDITOR REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 ("Act") and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2015, the Board of Directors of the Company had appointed M/s Arora Shekhar & Co., as the Secretarial Auditor of the Company to conduct the Secretarial Audit of the Company for the financial year 2017-18.

The Secretarial Audit Report of the Company for the financial year ended March 31, 2018, is annexed herewith as Annexure C to this Report. Management Comments on qualifications given by the Auditors in the Secretarial Audit Report are as follows:

1) The Company does not have Chief Financial Officer (CFO) as whole time key managerial personnel.

2) Branch information report of Second Quarter is not filed, however it may be noted that the company has no branches.

3) All Attendance Sheets are not properly signed however the concerned director was shown present as per respective Board or Committee minutes.

4) In case of minutes:

-No proof of circulation of the minutes of the meeting was maintained.

-All Minutes were not signed.

5) During the financial year under review after resignation of Mr. Ravi Sikka (Independent Director) the Composition of the board was not adequate.

6) The records of resolution passed by Circulation were not signed by Directors.

7) Company Does not have any Key Managerial Personnel in Compliance of the provisions of Section 203 of the Companies Act, 2013.

8) Return NBFCs-ND-SI 500 cr for March, 2018 - not filed.

9) Return ALM-2 & ALM-3 for Half Year March, 2018 - not filed.

10) Return ALM (NBFC-ND-SI) - not filed.

11) Statutory Auditors Certificate- Company has to file the certificate through COSMOS portal. No Proof of submission through COSMOS provided.

12) Company was classified as High Risk NBFC by FIU-IND for non appointing principle officer. However during the financial year the company has changed principal officer, during the financial year under review. No proof of submission or intimation of change to RBI and FIU-IND were provided.

13) Company does not have a Designated Director as per KYC Guidelines and PMLA.

14) Company is not registered with CERSAI.

15) Company has not submitted Board resolution for non acceptance of Public Deposit to the Reserve Bank of India.

16) As per the records provided the Company is only registered with 2 CIC i.e. Equifax and High Mark. Membership proof of other 2 CIC not provided.

17) The Company is not in Compliance of Net Owned Fund, CRAR and Prudential norms as prescribed by RBI.

18) For the financial year ended March 31,2018 finalisation of annual audited accounts had taken more than anticipated time.The Company was not able to declare its audited financial results within the prescribed timelines under SEBI LODR Regulations.The Company declared its audited financial results on 06th June, 2018. BSE, vide its communication dated 18th June,2018 had levied the fine of Rs. 41,300/- For delayed submission of financials for the period ended March 31, 2018.

19) During the period under review the company has granted interest free loan to related parties during the financial year. The outstanding amount of loans as on 31st March, 2018 is Rs. 7143.21 lakhs.

20) The Company has defaulted in payment in repayment of Rs. 56,500 lakhs (Principal amount) in respect of loan availed from Yes Bank Ltd. The default occurred on 20th July 2017 being the date on which the credit facility to the Company was recalled by the bank and this was not settled till 31st March, 2018.

21) According to information given by the management of the company, transactions with the related parties have been generally entered into by the company in ordinary course of business on arms length basis except for the transactions relating to loan given to six related parties during the year on which no interest has been charged. The outstanding amount of such loans on which interest has not been charged as at the end of the year aggregate to Rs. 1,12,603.70 lakhs.

Reply to Point No. 1 and 7(non appointment of CFO and KMP):

It was expected that the Company will appoint CFO post merger of Healthfore Technologies Limited with the Company. However, due to circumstances beyond the control, the Company had to withdrawn the Scheme in view of ongoing Daiichi Litigation, which includes the Company as a party. However, the management is now reviewing the future plans of the Company and will appoint suitable candidate as CFO.

Further during the year, Mr. Vivek Kumar Singh, Company Secretary of the Company resigned on September 14, 2017 and Mr. Varun Sood, Managing Director of the Company resigned on February 20, 2018. The Company is now looking for suitable candidates for appointment as KMPs.

Reply to Point No.2 and 8 to 17(Compliance under RBI Act and related applicable provisions):

In view of the fact that the Company does not have a full time Compliance Officer, the Company has not been able to look after the RBI Compliances during the year under review. However the management is looking for suitable candidates for appointment as KMPs.

Reply to Point No.3 to 6 (Non-Compliance with Secretarial Standards read with the Companies Act and related applicable provisions):

The Company has complied with Secretarial Standards and other applicable laws except in few cases where the minutes, attendance sheets and resolutions passed by circulation could not be signed although approved by the Board with the requisite quorum.

As already mentioned above, the Company does not have a full time Compliance Officer, however the management is looking for suitable candidates for appointment as KMPs.

Further as also mentioned in Corporate Governance Report forming part of the Annual Report, the Company has appointed 2(Two) Independent Directors out of which one is a Woman Director. Hence as an the date of this report, the composition of Board is in accordance with Companies Act, 2013 and SEBI LODR Regulations.

Reply to Point No.18 :

As already mentioned elsewhere in the Directors Report and also in Corporate Governance Report forming part of Annual Report,this is self-explanatory and hence no comments in this regard have been offered by the Board of Directors. The Company has paid the fine.

Reply to Point No.19 to 21(Related Party Transactions and Default in Repayment of Loan):

The response to the same is already provided under the head "Managements Response on the Statutory Auditors Qualification/Comments on the Companys Standalone and Consolidated Financial Statements"

PUBLIC DEPOSITS

Your Company has neither invited nor accepted any deposits from the public within the meaning of the Section 2(31) of the Companies Act, 2013,Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposit) Rules, 2014 during the period under review.

LISTING WITH STOCK EXCHANGE

The Equity Shares of your Company continue to be listed on BSE Limited ("BSE"). The Annual Listing Fee for the financial year 2017-18 has been paid to the BSE.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION

Even though operations of the Company are not energy intensive, the management has been highly conscious of the importance of conservation of energy and technology absorption at all levels and efforts are made in this direction on continuous basis.

The Company requires energy for its business operations and every endeavor has been made to ensure the optimal use of energy,avoid wastage and conserve energy as far as possible.

However,in view of the nature of activities which are being carried on by your Company which are not energy intensive, the particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 regarding Conservation of Energy, Research and Development and Technology Absorption are not applicable to the Company and hence not been provided.

FOREIGN EXCHANGE EARNINGS AND OUTGO

The Company has incurred an expenditure of Rs. 406.29 lacs (previous year Rs. 213.23 lacs) in foreign exchange and earned Nil (previous year: Nil) in foreign exchange during the year under review on a standalone basis.

INTERNAL FINANCIAL CONTROLS AND INTERNAL CONTROL SYSTEM

The Company has in place adequate systems of internal control commensurate with its size and the nature of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statutes, safeguarding assets from unauthorized use, executing transactions with proper authorization and ensuring compliance of corporate policies.

To ensure that all systems and procedures are in place and order, regular internal audit is conducted. Internal Audit of the Company during FY 2017-18 was conducted by M/s. VMA & Associates, Chartered Accountants. To maintain its objectivity and independence, the Internal Auditor reports to the Audit Committee about the Internal Audit findings and corrective actions thereon on a quarterly basis.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

The details of remuneration required under Section 197(12) of the Act read with Rule 5(1) & 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed herewith as Annexure- D to this report.

The details of remuneration paid to the Directors including Executive Directors of the Company are given in Form No. MGT-9 forming part of this Report.

VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The Company has a vigil mechanism named Whistle Blower Policy for Directors and employees of the Company to report their genuine concerns and to deal with instance of unethical practices, fraud and mismanagement or gross misconduct by the employees of the Company, if any that can lead to financial loss or reputation risk to the organization.

The policy has also been uploaded on the website of the Company and can be accessed through the link http://oscarinvestments.org/pdf/Whistle-Blower-Policy.pdf

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Work Place (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment.

All employees are covered under this policy. No case has been reported during the year under review.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

Except as disclosed above or elsewhere in this Annual Report, there have been no material changes and commitments affecting the financial position of the Company which have occurred between the end of financial year under review and the date of this report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

Except as disclosed above or elsewhere in this Annual Report, there are no significant material orders passed by the Regulators/ Courts which would impact the going concern status of the Company and its operations in future.

ACKNOWLEDGEMENTS

Your Directors would like to express their sincere appreciation for the co-operation and assistance received from the Companys Bankers, Regulatory Bodies, Stakeholders including Financial Institutions and other business associates who have extended their valuable sustained support and encouragement during the year under review.

Your Directors also gratefully acknowledge and appreciate the commitment displayed by all executives, officers and staff towards the success of the Company. We look forward for your continued support in the future.

On behalf of the Board of Directors
Sd/- Sd/-
Place: New Delhi (Malvinder Mohan Singh) (Shivinder Mohan Singh)
Date : August 30, 2018 Director Director