Talwalkars Better value Fitness Ltd Directors Report.

Your Directors are pleased to present 15th Annual Report on business and operations with the audited financial statement for the year ended 31st March, 2018:


The National Company Law Tribunal (NCLT), Mumbai Bench by its order dated 9th March, 2017 directed the Company to convene a meeting of Shareholders. Accordingly a Court Convened Meeting of Shareholders was held on 27th April, 2017 for the purpose of considering and if thought fit, approving, the Scheme of Arrangement between Talwalkars Better Value Fitness Limited ("Demerged Company") and Talwalkars Lifestyles Limited ("Resulting Company") and their respective shareholders. As per the Scrutinisers Report dated 27thApril, 2017, the Shareholders of the Company approved the said Scheme of Arrangement. The Scheme of Arrangement was sanctioned by the Honble National Company Law Tribunal, Mumbai Bench on 21st December, 2017. The certified true copy of order of Honble National Company Law Tribunal was filed with the Registrar of Companies on 20th February, 2018 and accordingly, the scheme has become effective from 20thFebruary, 2018.

Accordingly, the Resulting Company named as on the date of this report as Talwalkars Lifestyles Limited (TLL), is the Company to which the entire Gym business is transferred and the cost of acquisition of its share is 71.04%. The existing Company i.e. Talwalkars Better Value Fitness Limited (TBVFL) has retained all other business other than the Gym business and its cost is 28.96%.

In consideration of the demerger scheme, Talwalkars Lifestyles Limited has issued and allotted equity shares to the shareholders of Talwalkars Better Value Fitness Limited in the share entitlement ratio of 1:1 i.e. one (1) equity share of 10/- (Rupees Ten only) each in TLL for every one (1) equity share of 10/- (Rupees Ten only) each in TBVFL, held by each shareholder as on record date of 28th March, 2018.

Financial Highlights

The Company has adopted Indian Accounting Standards (‘IndAS) pursuant to notification issued by the Ministry of Corporate Affairs dated 16th February, 2015 and as prescribed under Section 133 of the Companies Act, 2013 read with the relevant rules made thereunder from 1st April, 2016 being the date of transition as per IndAS.

Financial statement for the year ended and as at 31st March, 2017 has been restated to confirm to IndAS. The highlights of your Companys standalone financial performance for the year ended 31st March, 2018 are summarised below:

in millions

Summarized Financial Results

March 31, 2018

March 31, 2017

Revenue from operations



Other Income



Total Income



Profit before interest, depreciation and taxation



Financial Expenses






Exceptional Items



Profit before tax



Provision for taxation



Deferred Tax



Profit after tax but before minority interest



Share of minority interest



Profit after tax



Excess provision of Income Tax written back



Balance brought forward



Total available for appropriation



Proposed Dividend



Corporate Dividend Tax



Debenture Redemption Reserve



General Reserve



Balance carried forward



Our Business

Vide the Scheme of Arrangement between Talwalkars Better Value Fitness Limited ("Demerged Company") and Talwalkars Lifestyles Limited ("Resulting Company") and their respective shareholders, the management of Demerged Company has demerged the Gym Business by transferring the same to Talwalkars Lifestyles Limited. Post sanction of the Scheme of Arrangement by NCLT, the business of your Company is to render different types of healthcare and beauty services including diet, nutrition-based weight-loss programs like Reduce, Nuform, yoga, physiotherapy, Zumba, Zorba, and other allied lifestyle and wellness activities etc.

Review of Operations

Riding the brand goodwill and management competence, our Income from Operations (Net) on a standalone basis grew at a 2 year CAGR (Financial Years 2016-17 and 2017-18) of 16.08% achieving 572.83 millions during financial year. Similarly, our EBITDA and Profits after Tax on a standalone basis for the year ended 31st March, 2018, were 389.47 millions and 102.20 millions respectively, growing at a 2 year CAGR (Financial Years 2016-17 and 2017-18) of 24.47% and 12.18% respectively.

During the year along with the financial performance, your Companys profit before tax as well as profit after tax and minority interest recorded a healthy growth of 0.53% and 12.18% respectively. The volume of the business also displayed an increase of 16.08% over last year.

No material changes affecting the financial position of the Company have occurred between the end of the financial year 2017-18 and the date of this Report, 7th May, 2018.

Share capital

During the year, the Company issued 13,00,000 Equity shares of

10/- each at a premium of 308.33/- on a preferential basis in terms of Chapter VII of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009. The funds have been used to finance the short term and long term working capital requirement of the business on one hand and to support the future growth plans of the Company, on the other.


Your Directors are pleased to recommend for the consideration of shareholders, a dividend @5% (Re.0.50/- per equity share of 10/-) for the year ended on 31st March, 2018. The dividend has been recommended in accordance with your Companys policy of balancing dividend pay-out with the requirement of funds for its growth plans.


The Directors have decided to retain the entire amount of 719.55 millions in the Profit and Loss Account.


During the year under review, Company has not accepted any fixed deposits from the public falling within the purview of Section 73 of the Companies Act, 2013 (herein after referred to as "the Act") and rules framed there under.


The Company has two subsidiaries as on 31st March, 2018. There has been no material change in the nature of the business of the subsidiaries. There are no Associate Companies or Joint Venture Companies within the meaning of Section 2(6) of the Act.

Pursuant to the provisions of Section 129(3) of the Act, a statement containing the salient features of financial statements of the Companys Subsidiaries in Form AOC-1 is attached to this Report as Annexure-I. Further, pursuant to the provisions of Section 136 of the Act, the financial statement of the Company, consolidated financial statement and the financial statements of subsidiaries, are available on the website of the Company. The Company has formulated a policy for determining material subsidiaries. The Policy may be accessed at the link: http://www.talwalkars.net/admin/investor/Po licyforMaterialSubsidiary12716164544408-7249c.pdf

Management Discussion and Analysis

A detailed Management Discussion and Analysis forms part of this Annual Report.

Corporate Social Responsibility (CSR)

The CSR policy of your Company is aimed at exhibiting care and concern for the Society. The Company broadly undertakes the activities related to health awareness, education, medical checkups, promotion of Art and culture etc. The Board plans to increase CSR expenses.

The initiatives undertaken by the Company on CSR activities during the year are set out in Annexure - II of this Report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. The policy on CSR as approved by the Board has been uploaded on the Companys website. CSR Policy may be accessed at http://www.talwalkars.net/admin/investor/ CSRPolicy12716164414123-0a542.pdf

Secretarial Standards

The Company complies with all the applicable Secretarial Standards.

Directors and Key Managerial Personnel

In accordance with the provisions of the Act and the Articles of Association of the Company, Mr. Vinayak Gawande (DIN: 00324591) and Mr. Girish Talwalkar (DIN: 00341675), Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. Resolutions for their re-appointment will be placed for your approval at the ensuing Annual General Meeting.

During the year Mr. Girish Talwalkar (DIN: 00341675), Executive Chairman of the Company was re-designated as Non-Executive Chairman with effect from 29th March, 2018.

Mr. Dinesh Afzulpurkar (DIN:05313394), Independent Director of the Company of the Company resigned from the Board with effect from 29th March, 2018 due to preoccupation. Your Directors placed on record its heartfelt gratitude for his valuable contribution towards the success of the Company.

Mr. Prashant Talwalkar, Managing Director and Chief Executive Officer, Mr. Madhukar Talwalkar, Mr. Girish Talwalkar, Mr. Anant Gawande, Mr. Vinayak Gawande, Mr. Harsha Bhatkal, Whole-time Directors, Mr. Girish Nayak, Chief Financial Officer and Ms. Avanti Sankav, Company Secretary and Compliance Officer of the Company are the Key Managerial Personnel of the Company in terms of Section 2 (51) read with Section 203 (1) of the Companies Act, 2013.

During the year, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

Independent Directors of your Company have given declaration confirming their independence and fair conduct in performance as provided in Section 149 of the Act and the SEBI Listing Regulations Requirements of the Stock Exchanges.

Ten Board meetings were held during the Financial Year 2017-18 with requisite quorum present for each of them, the details of which are given in the Corporate Governance Report.

Board Evaluation

The Board of Directors has carried out an annual evaluation of its own performance as well as that of its Committees and individual Directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by SEBI Listing Regulations. The performance of the Board was evaluated after seeking inputs from all the Directors on the basis of criteria such as the Board composition and structure, effectiveness of Board processes, information and functioning etc. The Guidance Note issued by the Securities and Exchange Board of India on Board Evaluation was duly considered while conducting the evaluation.

In a separate meeting of Independent Directors, performance of non-Independent Directors and the Board as a whole was evaluated, taking into account the views of Executive Directors and Non-Executive Directors. The same was discussed in the Board Meeting that followed the meeting of the Independent Directors, at which the performance of the Board, its Committees and individual Directors was also discussed. Performance evaluation of independent Directors was done by the entire Board, excluding the independent Director being evaluated.

Companys Policy on Directors Appointment and Remuneration

The Companys policy on Directors appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the Corporate Governance Report, which forms part of this report.

Audit Committee

The details pertaining to composition, functions performed and meetings of Audit Committee are included in the Corporate Governance Report, which forms part of this report.

Your Directors highly value the suggestions of the Audit Committee and have never turned down any of it.

Related Party Transactions

In line with the requirements of the Companies Act, 2013 and SEBI Listing Regulations, your Company has formulated a Policy on Related Party Transactions which is also available on the Companys website at http://www.talwalkars.net/admin/investor/ PolicyonRelatedPartyTransactions12716165958474-995fe.pdf

The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and Related Parties.

All Related Party Transactions are placed before the Audit Committee for review and approval. Prior omnibus approval is obtained for Related Party Transactions on a quarterly basis for transactions which are of repetitive nature and / or entered in the ordinary course of Business and are at Arms Length basis. These transactions were entered as per the Companys Policy on Related Party transactions. No related party transaction was in conflict with the interests of the Company.

No Significant Material Related Party Transactions were entered during the year by your Company. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013, in Form AOC-2 is not applicable.

Risk Management

Your Company has constituted Risk Management Committee to identify and mitigate various risks faced by the Company from time to time. The details of the Risk Management Committee and its terms of reference are set out in the Corporate Governance Report.

Particulars of loans, guarantees and Investments

The particulars of loans, guarantees and investments have been disclosed in the financial statement forming part of this Annual Report and the same were given for the principal business activities.

Particulars of Employees

Pursuant to Section 197 of the Act, read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, none of the employees of the Company was in receipt of the remuneration during the financial year 2017-18, which in aggregate was in excess of 1.02 crores per year or 8.5 lakhs per month or in excess of the remuneration drawn by the Managing Director or Whole-time Director or Manager and holds by himself or along with his spouse and dependent children two percent or more of the equity shares of the Company.

The statement of particulars of appointment and remuneration of managerial personnel pursuant to Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is as under:

(i) Ratio of the remuneration of each Director to the median remuneration of the Employees of the Company for the financial year 2017-18 and the percentage increase in remuneration of each Director, Chief Executive Officer, Chief Financial Officer and Company Secretary during the financial year 2017-18:

Name of Director/KMP Designation

Ratio of remuneration of each Director to median remuneration of Employees

Percentage increase in remuneration

1 Girish Talwalkar Non-Executive Chairman



2 Madhukar Talwalkar Whole-time Director



3 Prashant Talwalkar Managing Director & CEO



4 Vinayak Gawande Whole-time Director



5 Anant Gawande Whole-time Director



6 Harsha Bhatkal Whole-time Director



7 Manohar Bhide Independent Director



8 Raman Maroo Independent Director



9 Mohan Jayakar Independent Director



10 Avinash Phadke Independent Director



11 Abhijeet Patil Independent Director



12 Dinesh Afzulpurkar# Independent Director



13 Mrunalini Deshmukh Independent Director



14 Avanti Sankav Company Secretary

Not Applicable


15 Girish Nayak Chief Financial Officer

Not Applicable


# Mr. Dinesh Afzulpurkar has resigned as Independent Director w.e.f. 29th March, 2018

(ii) The percentage increase in the median remuneration of employees in the financial year: 15.08%.

(iii) Permanent employees on the roll as on 31st March, 2018: 9

(iv) During the Financial year 2017-18, there was an average 19.05 % increasein the salaries of employees other than the managerial personnel in the last financial year. Managerial Remuneration rose by 23.86 % in line with the volume of the Companys business and profits earned by it and their responsibilities.

(v) We hereby affirm that the remuneration paid is as per the remuneration policy of the Company.

Directors Responsibility Statement

In accordance with the provisions of Section 134(5) of the Act, your Directors confirm that:

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

(b) 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 at the end of the financial year and of the profit of the Company for that period;

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

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

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

(f ) 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;

Based on the framework of internal financial controls and compliance systems established by the Company, work performed by the internal, statutory and secretarial auditors, including audit of internal financial controls over financial reporting by the statutory auditors, the Board is of the opinion that the Companys internal financial controls were adequate and effective during financial year 2017-18.

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

Conservation of Energy and Technology absorption are not applicable to the Company.

Foreign Exchange earnings and Outgo

In millions




Total foreign exchange earnings



Total foreign exchange outgo




Statutory Auditor

M. K. Dandeker & Co., Chartered Accountants (Firm Registration Number: 000679S) were appointed as Statutory Auditors of your Company at the Annual General Meeting held on 8th September, 2016, for a term of five consecutive years. As per the provisions of Section 139 of the Companies Act, 2013, the appointment of Auditors is required to be ratified by Members at every Annual General Meeting.

Auditors report and Secretarial Audit Report

The Auditors Report and Secretarial Audit Report do not contain any qualification, reservation or adverse remarks. Secretarial Audit Report is attached to this report.

Details of the statutory orders impacting the Company

Honble National Company Law Tribunal, Mumbai Bench passed an order on 21st December, 2017 approving the Scheme of Arrangement between Talwalkars Better Value Fitness Limited ("Demerged Company") and Talwalkars Lifestyles Limited ("Resulting Company") and their respective shareholders.

Other than the one mentioned above, no significant and material orders were passed by the Regulators or Courts or Tribunals impacting the going concern status and the Companys operations in future.

Extract of the Annual Return

The extract of annual return in Form MGT-9 as required under Section 92(3) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014 is appended as an Annexure -IV to this Annual Report.

Corporate Governance

As per SEBI Listing Regulations, Corporate Governance Report with a certificate of Practicing Company Secretary is attached, which forms part of this report.


Your Directors take this opportunity to place on record its appreciation of sincere efforts put in by the employees of the Company in making the Company excel in its services.

Your Directors sincerely thank all the investors, members, bankers, financial institutions, business associates, regulatory and government authorities for their continued support, assistance and valuable co-operation in the growth of company.

For and on behalf of the Board

Talwalkars Better Value Fitness Limited

Anant Gawande

Whole-time Director DIN: 00324734

Prashant Talwalkar

Managing Director & CEO DIN: 00341715 Date:7th May, 2018 Place: Mumbai