TO,

THE MEMBERS OF,

TATA CAPITAL LIMITED

The Directors have pleasure in presenting their Annual Report and the Audited Statements of Accounts for the year ended March 31, 2014.

1. BACKGROUND

Tata Capital Limited ("Company" or "TCL") is a subsidiary of Tata Sons Limited and is registered with the Reserve Bank of India ("RBI") as a Core Investment Company ("CIC").

As a CIC, TCL is primarily a holding company, holding investments in its subsidiaries and other group companies and carries out only such activities, as are permitted under the Directions issued by the RBI for CICs. TCL and its subsidiaries (collectively referred to as "Tata Capital") are engaged in a wide array of businesses in the financial services sector. A detailed discussion on TCL's business and that of its subsidiaries is set out in Para 6 of this Report.

2. INDUSTRY AND ECONOMIC SCENARIO

India is in transition and if it desires to regain its position as a leading emerging market investment destination, clarity and consistency of policy action is paramount. The election results hold the key. In anticipation, the equity markets have created an all time high and currency markets are buoyant. However, investors, private and foreign, will wait for stability of governance and policy action before committing long term capital to the country. At its core, India is facing a difficult economic situation on the growth, asset quality, inflation and fiscal deficit fronts. Growth is estimated to have bottomed, but recovery is predicated upon clarity of policy matters and decision making by the Government, both factors out of the control of private enterprise. Slower growth has translated into asset quality issues for the banking sector. Gross non performing loans have risen to 3.6% in FY13-14 from 2.5% in the FY 2012-13, which may have been acceptable given the capital requirements of Indian banks. However, if one includes restructured assets currently at 9.4%, the asset quality issue is a real concern. Inflation may have peaked out, but structural factors, especially on the food front, need to be adequately tackled. Monsoons will clearly be a variable in FY 14-15, given the various predictions of a below par monsoon. Lastly on the fiscal deficit, targets have been met, but many constituents continue to question the quality and means of this achievement.

The RBI and the Government have taken notable steps in FY 2013-14 to address the economic headwinds. The Government formed the Project Management Group to facilitate large projects, undertook actions on power tariffs, gas price and continued diesel price increases. The RBI initiated efforts at recognizing and cleaning up Non-Performing Assets ("NPA"). On the policy front, it introduced a shift in focus to Consumer Price Inflation (CPI) from Wholesale Price Inflation (WPI), and a move towards inflation targeting. If implemented correctly and in a time bound manner, these collectively have the ability to create a meaningful impact on the economy.

The Government's first GDP estimate for FY13-14 estimates growth at 4.9%, largely in line with market expectations. The Interim Budget which was the last budget of the UPA-II Government was "not" biased towards populist measures but focused on growth measures like reduction in excise duties on capital and consumer goods and maintaining the fiscal deficit target within limits. The key to a higher growth would be reviving investments (initially by revival of stalled projects), especially in the private sector and higher domestic savings, especially financial savings, by containing inflation and positive real return.

Debt in the private sector has risen despite India's total debt (private and public) remaining at ~ 139% of GDP in line with the last 10 years' average. Rising private-sector debt coupled with repayments to the tune of ~US$ 20 bn annually make the economy vulnerable to international capital flows. Though the real economy is largely domestic oriented, given its dependence on capital flows, India is open to exchange volatility and its related pitfalls.

On the global front, the Federal Reserve reduced its monthly asset purchases with the last reduction for FY 13-14 being made in February 2014. The monthly purchases are down to US$65bn (US$ 35 bn Treasury + US$ 30 bn Mortgage Backed Securities). Global observers expect the tapering to continue in the coming months leading to a complete wind down by end of Q2 2014-2015.

The year ahead will be challenging on the interest rate and credit quality front, however if India votes a stable Government we could see an improvement in asset quality and return growth.

3.1 Consolidated Results:

The Company's book size increased from Rs. 24,740 crore as at March 31, 2013 to Rs. 28,535 crore as at March 31, 2014, on a consolidated basis. This increase of about Rs. 3,800 crore was mainly due to growth in the loan book of two major subsidiaries of the Company viz. Tata Capital Financial Services Limited ("TCFSL")-Rs. 1,500 crore and Tata Capital Housing Finance Limited ("TCHFL")-Rs. 2,150 crore.

During FY 2013-14, the Company recorded consolidated Total Income of Rs. 3,579 crore as against Rs. 3,261 crore in the previous year, an increase of about 10%. This comprised income from financing activities of Rs. 3,136 crore (Previous Year: Rs. 2,754 crore), Investment Income of Rs. 177 crore (Previous Year: Rs. 270 crore) and Other Income ofRs. 265 crore (Previous Year: Rs. 237 crore). The growth in income from financing activities was in line with the growth in advances. The reduction in the Investment Income was primarily on account of reduction in credit substitutes of TCFSL.

During the year, the Company's Net Profit after Tax, on a consolidated basis, reduced by about 45% to Rs. 214 crore (Previous Year: Rs. 391 crore). This reduction was mainly on account of lower share of the profits of associates of Rs. 16 crore (Previous Year: Rs. 147 crore). Further, the profitability was also impacted due to higher credit costs and provisions for diminution in value of investments Rs. 284 crore (Previous Year: Rs. 192 crore).

During FY 2013-14, Tata Capital's consolidated interest expense was Rs. 2,148 crore (Previous Year: Rs. 1,968 crore). This increase was on account of higher borrowings of Rs. 3,418 crore (Previous Year: Rs. 2,327 crore), in line with the growth in the loan portfolio. The increase in interest expense was also due to the higher interest rates prevailing in the economy particularly during the second and third quarters of FY 2013-14. Notwithstanding tight liquidity conditions in the market, Tata Capital was able to ensure a comfortable liquidity position to support its business requirements.

As stated above, during FY 2013-14 the Operating Expenses, which include credit costs and provisions for diminution in value of investments, increased by 25% and stood at Rs. 702 crore as against Rs. 561 crore in FY 2012-13. The Operating Expenses excluding credit costs and provisions for diminution in value of investments, increased by 13%, in line with the growth in the book size. Employee costs increased from Rs. 261 crore in FY 2013-14 to Rs. 309 crore in FY 2013-14, owing to increase in manpower strength to support new businesses and growth in existing businesses and also on account of salary increments which were broadly in line with industry.

Due to a tough economic environment, the consolidated Gross NPA and Net NPA increased to 3.54% and 2.86% respectively as against 1.98% and 1.47% respectively in FY 2012-13. A provision of Rs. 15 crore (Previous Year Rs. 15 crore) was made for Standard Assets on incremental Standard Assets for the FY 2013-14. Further, a provision of Rs. 28 crore (Previous Year: Nil) was made on restructured advances pursuant to a new requirement introduced by the RBI during FY 2013-14. The consolidated Return on Assets ("RoA") for FY 2013-14 was 0.53% (Previous Year: 1.73%) while the Return on Equity ("RoE") was 3.72% (Previous Year: 11.32%). For FY 2013-14, the normalized ROA was 0.96% (Previous year -1.67%) and ROE was 6.76% (Previous year-10.64%).

3.2 Unconsolidated Results:

During FY 2013-14, the Company recorded a Gross Income of Rs. 167 crore (Previous Year: Rs. 145 crore) and Profit After Tax ("PAT") of Rs. 78 crore (Previous Year: Rs. 23 crore). The increase in PAT is mainly on account of reduced interest payments attributed to lower average borrowings of the Company. The Company met its long term funding requirements largely by way of issue during the current year of Cumulative Redeemable Preference Shares of Rs. 1000 each aggregating Rs. 479 crore.

4. SHARE CAPITAL

The paid-up Equity Share Capital of the Company was Rs. 2,826 crore on March 31, 2014, which was held by Tata Sons Limited (90.28%), Tata Investment Corporation Limited (2.73%) and the TCL Employee Welfare Trust (through its Trustees) (1.96%). The balance 5.02% was held by other Tata companies, trusts, other corporates, individuals and employees of TCL and its subsidiaries.

During FY 2013-14, the Company successfully raised Rs. 479 crore through the issue of Cumulative Redeemable Preference Shares ("CRPS") of Rs. 1,000 each carrying dividend rate of 8.33 % p.a on a private placement basis.

Under the Tata Capital Limited Employee Stock Purchase/Option Scheme ("ESOP Scheme"), the Company has allotted 7,02,34,526 Equity Shares of Rs. 10/- each to the TCL Employee Welfare Trust (through its Trustees), which was set up to administer and implement the ESOP Scheme. As on March 31, 2014, the number of Equity Shares transferred to the eligible employees under the ESOP Scheme aggregated 1,47,31,794.

5. DIVIDEND

The Directors have recommended, for approval of the Members, dividend @ 12.50% per annum on CRPS allotted until March 31, 2013 (issued at a premium of Rs. 500 per share) and @ 8.33% per annum on CRPS allotted post March 31, 2013 (issued at par value of Rs. 1000/- each), aggregating an amount of Rs. 57.83 crore.

In order to conserve the resources of the Company and to build up reserves and considering the business plans of the Company, the Company does not recommend payment of dividend on Equity Shares for the FY ended March 31, 2014.

6.1 Structure of Business Operations at Tata Capital

TCL is primarily a holding company, holding investments in its subsidiaries and other group companies and carries out only such activities, including management of private equity funds, as are permitted under the Directions issued by the RBI for CICs. All the other operating businesses are carried on by the subsidiaries of TCL. Tata Capital has completed six full years of operations and over this period has emerged as one of the leading players in the NBFC space in India.

The financial services sector, in India as also globally, is a highly regulated area and owing to this, TCL and its subsidiaries are subject to regulations by authorities such as the Reserve Bank of India, Securities and Exchange Board of India, National Housing Bank, Monetary Authority of Singapore and Financial ConductAuthority, UK.

As a one stop financial services provider, Tata Capital caters to the diverse financial requirements of its retail, corporate and institutional customers with a wide suite of product and service offerings. In the corporate segment, the Company's subsidiary TCFSL offers commercial finance, infrastructure finance and leasing solutions to corporate customers. Tata Cleantech Capital Limited ("TCCL"), also a subsidiary of the Company, provides finance and advisory services to corporate customers for renewable energy, energy efficiency and water management projects. In the consumer segment, TCFSL provides asset finance and rural finance to its retail customers. TCFSL is also engaged in the business of distribution of investment products such as mutual funds under its wealth management business and is engaged in the distribution of White Label Credit Cards and travel cards, in association with its bank partners. Tata Capital also operates in the housing finance space through another subsidiary viz. TCHFL which offers Housing Loans and Loans against Property mainly in the retail segment. Tata Capital provides investment banking and broking services to retail and institutional clients in India through its subsidiary Tata Securities Limited ("Tata Securities"). In the private equity space, the Company has sponsored Private Equity Funds in India, to which it acts as an Investment Manager. The Company's step-down wholly owned subsidiary in Singapore, Tata Capital Advisors Pte. Ltd. also acts as an Investment Manager to the Private Equity Funds set up in Singapore, to which the Company acts as an Advisor. Tata Capital offers travel and forex related services to the retail and corporate customers, through two wholly owned subsidiaries-TC Travel and Services Limited ("TCTSL") and Tata Capital Forex Limited ("TCFL"), respectively. e-Nxt Financials Limited ("e-Nxt"), an associate of the Company, is engaged in the business of Collections and Business Process Management. Tata Capital Pte. Ltd. ("TCPL"), a wholly-owned subsidiary of TCL, has been established in Singapore as the International Headquarters of Tata Capital and is responsible for Tata Capital's international presence and activities.

6.2 Review of Subsidiaries

As on March 31, 2014, Tata Capital had the following subsidiaries, brief details of whose performances are given below. Further, a statement containing brief financial details of each of the subsidiaries for the Financial Year ended March 31, 2014 is included in the Annual Report at Page No. 126.

i) Tata Capital Financial Services Limited ("TCFSL")

TCFSL is a wholly owned subsidiary of the Company, registered with the RBI as non deposit accepting systemically important NBFC. Pursuant to the conversion of TCL into a CIC in May 2012, all the fund based and fee based activities (except private equity and investment advisory services) hitherto carried on by TCL are carried on by TCFSL. TCFSL has two main areas of business viz. Corporate Finance and Consumer Finance & Advisory.

TCFSL's average book size increased by Rs. 948 crore from Rs. 18,786 crore in FY 2012-13 to Rs. 19,734 crore in FY 2013-14. During FY 2013-14 the Gross Income marginally increased by 3% and stood at Rs. 2,783 crore (Previous Year: Rs. 2,701 crore). Its Profit after Tax for FY 2013-14 was Rs. 172 crore (Previous Year: Rs. 276 crore). This decrease was owing to non recurring investment impairment and credit costs. The Gross and Net NPAs increased in FY 2013-14 and stood at 4.5% and 3.7% respectively compared to 2.3% and 1.7% in FY 2012-13. The Cost to Income ratio in FY 2013-14 was 47.8% as compared to 45.3% in the previous year.

Corporate Finance

The Corporate Finance Division of TCFSL has two broad business segments viz. Commercial Finance and Infrastructure Finance.

Commercial Finance

The Commercial Finance Division specializes in product offerings ranging from vanilla term loans, working capital loans, channel finance, bill discounting, equipment financing, leasing, lease rental discounting, promoter funding to structured products. The Division has a very strong focus on debt syndications and direct lending including equipment finance. The Division's book size grew by around 10% during FY 2013-14 and ended at Rs. 8,974 crore as compared to a book size of Rs. 8,085 crore in FY 2012-13. This Division has disbursed fresh loans of Rs. 26,491 crore in FY 2013-14 across 8 product offerings and earned a total fee income of Rs. 65.70 crore.

Infrastructure Finance

The Infrastructure Finance Division has three main lines of business viz. Construction Equipment Finance, Project Finance and Equipment Rentals.

The macroeconomic environment continued to remain subdued during FY 2013-14. The Infrastructure segment as a whole was also adversely affected due to certain regulatory issues and delayed payment from government bodies. These challenges had an impact on TCFSL, resulting in reduced disbursement levels, as compared to FY 2012-13 and greater stress on the portfolio quality. TCFSL has been cautious in making fresh disbursements in the infrastructure segment and has been focusing on maintaining its asset quality. During FY 2013-14, the Division disbursed fresh loans of Rs. 2,425 crore (FY 2012-13: Rs. 3,403 crore) and closed the financial year with a decrease in the book size by 6% at Rs. 5,717 crore (FY 2012-13: Rs. 6,105 crore).

Leasing

In FY 2012-13, TCFSL forayed into leasing business and has successfully made inroads into equipment leasing through strategic Vendor Programs with some leading and prominent players in IT, Transportation and Capital Goods Manufacturing sectors. This business unit also sources its leads through the Commercial and Infrastructure Finance business units. During FY 2013-14, the leasing business unit sanctioned facilities of over Rs. 230 crore and as on March 31, 2014, its book stood at Rs. 203 crore comprising of pedigreed customers from multinational, large and mid corporate segments.

Leasing solutions largely appeal to corporates conscious of asset life cycle and total cost of usage of assets. With its comprehensive solutions approach, our Leasing Solutions team is expected to be one of the key business units of Corporate Finance Division.

Consumer Finance:

Tata Capital offers through its Consumer Finance and Advisory Business Division (CFAB), a wide range of consumer loans such as Auto Loans (Car and Two Wheeler), Commercial Vehicle Loans, Business Loans, Personal Loans, Consumer Durables Loan, Loans against Property, Loans against Securities and Tractor Loans.

Disbursements in F.Y. 2013-14 aggregated Rs. 4,214 crore as compared to Rs. 3,824 crore in F.Y. 2012-13, representing an increase of about 10%. While Auto Loans continued to constitute the major share of disbursements at Rs. 1,842 crore in F.Y. 2013-14 (Previous Year: Rs. 1,953 crore), the Tractor Finance business was further scaled up during the year, with disbursals increasing to Rs. 559 crore during FY 2013-14 from Rs. 258 crore in FY 2012-13 reflecting a year on year increase of 116%. The Direct Business Vertical, which was launched in FY 2012-13, continued to work on Tata Capital's core strategy of becoming 'customer-centric' and building customer proximity, by offering a single- point interface to customers for all their financial needs.

Going forward, CFAB plans to grow its business by ramping up its existing products, improving profitability by balancing its product mix, controlling operating costs, improving recoveries & collection efficiencies and enhancing risk management.

Others:

Tata Card is a White Label Credit Card issued and operated by SBI Cards, a JV between SBI and GE Capital. TCFSL is responsible for the marketing and alliances with the Tata group entities while the Sales, Customer Service, credit risk and other back end operations are managed by SBI cards.

Tata Cards has a base of 1.40 lakh customers as on March 31, 2014, up from 1.16 lakh in FY 2012-13, clocking a growth of 19%. The total customer spends for the FY 2013-14 were Rs. 818 crore, up from Rs. 530 crore in FY 2012-13, resulting in a 53% growth in spends, while the industry grew by only 30%.

The Tata Card is backed by its flagship loyalty program called Empower and it is the most rewarding program in the industry. The card allows the customer to earn points on every spend and redeem instantly across 200 stores of Tata companies like Croma, Westside, Titan and Star Bazaar.

ii) Tata Capital Housing Finance Limited ("TCHFL")

TCHFL is a wholly owned subsidiary of the Company, and is registered with National Housing Bank ("NHB") to carry on housing finance activities. TCHFL offers Housing Loans and Loans against Property to various segments of society and has been focusing on business opportunities available within the Tata ecosystem. Apart from Housing Loans and Loans against Property to the retail segment, TCHFL also provides Project Finance Loans to developers. TCHFL has significantly grown its presence in providing project finance to eligible projects across the country and has also ramped up the rural and affordable housing finance business.

Despite an increase in residential property prices during 2013-14, the demand for individual home loans remained buoyant, with strong growth coming from Tier-II and Tier-III cities. Other factors that promoted strong demand for individual home loans include increase in disposable incomes, interest rate subvention and fiscal incentives on housing loans.

During the year under review, TCHFL disbursed Mortgage Loans amounting to Rs. 3,159 crore (Previous Year: Rs. 2,591 crore), representing an increase of over 22%. This included Housing Loans of Rs. 2,269 crore (Previous Year: Rs. 1,933 crore). TCHFL's loan portfolio increased by 50% and stood at Rs. 6,366 crore on March 31, 2014 (March 31, 2013: Rs. 4,237 crore). TCHFL recorded a Gross Income of Rs. 643 crore and Profit after Tax of Rs. 58 crore in F.Y. 2013-14, as compared to Gross Income of Rs. 387 crore and Profit after Tax of Rs. 28 crore, in the previous year. The Cost to Income ratio further improved in FY 2013-14 and was 46.6% as compared to 56.3% in the previous year. The asset quality was stable with Gross NPA and Net NPA at 0.39% and 0.29% respectively, on March 31, 2014 (March 31, 2013: 0.39% and 0.33% respectively).

During the year 2013-14, (July-June) TCHFL has obtained total sanctions of Rs. 300 crore from NHB under its various Refinance Assistance Schemes and availed refinance of Rs. 223 crore under these as on March 31, 2014.

As a strategy, TCHFL will continue to maintain a balanced housing loan book between the salaried and self-employed segment and grow its disbursement significantly to become one of the major players among the Housing Finance Companies over the next few years.

iii) Tata Cleantech Capital Limited ("TCCL")

Tata Cleantech Capital Limited, a subsidiary of TCL, is a Systemically Important Non Deposit Taking Non Banking Financial Company, registered with the RBI and engaged in the business of providing finance and advisory services for renewable energy, energy efficiency, and water management projects. Infrastructure Finance Corporation ("IFC") holds 19.5% of the equity share capital of TCCL and the balance 80.5% is held by TCL.

Renewable Energy is a focus area for the Government and is among the few sectors in the infrastructure area that attracted investments in FY 2013-14.

TCCL commenced its business operations as a NBFC in April 2013. In its first year of operations TCCL has built capabilities of sourcing and appraising projects in its mandated areas of business. TCCL participated either as a consortium member or a co-lender in the large projects it financed during the year. During FY 2013-14, TCCL built a loan book of Rs. 132 crore, comprising projects in the areas of Wind Energy, Solar Energy, Small Hydro Energy, Rooftop Solar, Waste Management, Water Management and Energy Eficiency.

TCCL has entered into alliances with industry leaders to fill value chain gaps and improve market accessibility. Prominent among these is the alliance with Hyflux India, an arm of Hyflux Singapore, a global leader in the area of Water Management. To capitalize on synergies within the Tata Group, TCCL has established linkages within other Tata Companies that are involved in similar businesses.

iv) Tata Securities Limited ("Tata Securities")

Tata Securities, a wholly owned subsidiary of the Company, is engaged in the business of securities broking, investment banking services, depository participant services and distribution of mutual fund units and third party products. It is a member of the National Stock Exchange of India Limited ("NSE") in the cash, derivatives, currency derivatives and wholesale debt market segments and of the Bombay Stock Exchange Limited ("BSE") in the cash and derivative segments. Tata Securities is also a Depository Participant of the National Securities Depository Limited ("NSDL") and the Central Depository Services (India) Limited ("CDSL"). Tata Securities also holds a Merchant Banking License issued by SEBI.

During the year under review, Tata Securities has reported a Gross Income of Rs. 24.11 crore (Previous Year: Rs. 26.92 crore) and a Net Loss of Rs. 11.90 crore (Previous Year: Net Loss of Rs. 9.82 crore). The continuing loss in FY 2013-14 was mainly on account of lower brokerage and investment banking income attributable in part to volatile market conditions as also certain regulatory changes which considerably reduced income generated by the institutional distribution segment of Tata Securities.

Efforts are being undertaken to improve the performance of Tata Securities and achieve profitability in all its business segments. There have been concerted efforts to work together with teams from TCFSL, Tata Capital Pte. Ltd. Singapore and Tata Capital Plc., U.K., to offer seamless service to clients for all their investment banking requirements subject to compliance with local regulations and on an arm's length basis.

During the year, T Sec Commodities Broking Limited ("TSCBL"), a wholly owned subsidiary of the Company, incorporated for undertaking broking activity in commodity derivatives segment, has been amalgamated with Tata Securities, with effect from April 1, 2013. TSCBL had not commenced the said business and due to change in business plans, it was decided to amalgamate TSCBL with Tata Securities.

v) TC Travel and Services Limited ("TCTSL")

TCTSL, a wholly-owned subsidiary of TCL is primarily engaged in travel and travel related services. The year ended March 31, 2014 was a difficult one due to pricing and competitive pressures as well as general slack in business which resulted in lesser travel spends by corporate customers. Certain other cost pressures arising from some transformational changes resulted in further pressure on profitability. TCTSL achieved a turnover of Rs. 152 crore (Previous Year Rs. 190 crore). Revenue for the year at Rs. 8.36 crore was lower than the revenue of Rs. 9.96 crore in FY 2012-13. The loss for the year was Rs. 6.61 crore (Previous Year: Loss of Rs. 0.83 crore).

vi) Tata Capital Forex Limited ("TCFL")

TCFL, formerly known as TT Holdings & Services Limited, a wholly-owned subsidiary of TCL, holds a Full-Fledged Money Changer (FFMC) License from RBI and is engaged in the money-changing business through foreign currency, Traveller Cheques and pre-paid Travel cards. During FY 2013-14, TCFL recorded a revenue of Rs. 15.66 crore (Previous Year Rs. 15.97 crore). Due to certain prior period expenses coupled with subdued business environment resulting in lower spends on foreign travel by corporate customers, TCFL reported a loss of Rs. 5.96 crore (Previous Year loss of Rs. 0.60 crore).

vii) India Collections Management Limited ("ICML")

A subsidiary of TCL, ICML was set up as a joint venture company to provide receivables and collections management services in the banking, financial and other industrial sectors and consultancy, advisory services in relation thereto. ICML is yet to commence business. International Finance Corporation, is a shareholder in ICML.

viii) Tata Capital Pte. Ltd. ("TCPL"), Singapore and its subsidiaries viz. Tata Capital Advisors Pte. Ltd. ("TCAPL"), Singapore, Tata Capital Markets Pte. Ltd. ("TCMPL"), Singapore and Tata Capital Plc. ("TCPLC"), U.K.

TCPL, a wholly-owned subsidiary of TCL incorporated in Singapore in 2008, has been established as the International Headquarters of Tata Capital. TCPL, either on its own or through its subsidiaries, is engaged in fund management, advising on corporate finance, dealing in securities and investments in debt papers.

TCAPL, a wholly owned subsidiary of TCPL, holds a Capital Markets Services ("CMS") licence, under the Securities and Futures Act of Singapore, for conducting regulated Fund Management activities. TCAPL acts as investment manager to the offshore Private Equity Funds set up by TCPL. During FY 2013-14, Tata Capital HBM Healthcare Fund I, announced its first close. With this, the total commitment from investors in the offshore Private Equity funds managed by TCAPL stands at USD 720 million.

During the year under review, TCMPL, another wholly owned subsidiary of TCPL, obtained a Capital Markets Services licence from the Monetary Authority of Singapore, under the Securities and Futures Act of Singapore, for conducting regulated activities of advising on Corporate Finance and Dealing in Securities (excluding IPOs). TCMPL, during FY 2013-14, completed 4 corporate finance advisory deals and received the "Best Exit Award" during the prestigious SVCA Annual Awards 2013 for one of these.

TCPLC, a wholly owned subsidiary of TCPL, incorporated in the UK, is authorised by the Financial Conduct Authority to carry on regulated activities such as advising clients on fund raising, proposing investment ideas to investors as well as advising and executing on mergers and acquisitions. TCPLC also offers fund marketing services to TCAPL.

During the year under review, TCPL recorded consolidated Gross Income of US$ 18.04 million (Rs. 108.75 crore) (Previous Year: US$ 17.2 million (Rs. 93.5 crore)), Profit Before Tax of US$ 6.18 Million (Rs. 37.3 crore) (Previous Year: US$ 5.5 million (Rs. 29.89 crore)) and Profit After Tax of US$ 6.21 million (Rs. 37.44 crore) (Previous Year: US$ 5.33 million (Rs. 28.97 crore)) (US $ translated to Rs. 60.28 at exchange rate prevailing on March 31, 2014 for current year figures).

ix) Tata Infrastructure Capital Limited ("TICL")

TICL, a wholly owned subsidiary of the Company, was incorporated on July 9, 2010, following a Notification issued by the RBI introducing a new category of NBFCs as Infrastructure Finance Companies which would be entitled to raise long term funds in a more cost effective manner from domestic and international sources. TICL is yet to be registered with the RBI and has not commenced any business activity.

x) Other Subsidiaries

In addition to the above subsidiaries, the following entities are also treated as subsidiaries of the Company, as per applicable Accounting Standards:

• Tata Capital Growth Fund I, a venture capital fund set up by TCL in which TCL holds 73.75% stake.

• Tata Capital General Partners Limited Liability Partnership ("LLP"), a partnership formed in Singapore to act as a General Partner and manage the Tata Capital Growth Fund I.

• Tata Capital Healthcare General Partners LLP, a partnership formed in Singapore to act as a General Partner and manage the Tata Capital HBM Healthcare Fund I LP.

• Tata Opportunities General Partners LLP, a partnership formed in Singapore to act as a General Partner and manage the Tata Opportunities Fund LP.

b) Investment Summary & Provisions:

As at March 31, 2014, the Company had, as per its consolidated accounts, total investments of Rs. 2,450 crore (Previous Year: Rs. 2,249 crore). Of this, Rs. 486 crore (Previous Year: Rs. 450 crore) were investments in associate companies and balance Rs. 1,964 crore (Previous Year: Rs. 1,799 crore) were in shares of other companies and in debt instruments such as debentures, pass through certificates, commercial paper, government securities, etc. The Company's investment in its subsidiaries stood at Rs. 3,640 crore as at March 31, 2014 (Previous Year: Rs. 3,409 crore), representing 83% of its total Assets (Previous Year: 86%), which amount is eliminated in the consolidated accounts, in accordance with prevailing Accounting Standards.

As on March 31, 2014, an aggregate provision, on a consolidated basis, of Rs. 96.49 crore (Previous Year: Rs. 162 crore) has been made for diminution, other than temporary, in the value of investments.

6.3 Private Equity

The Company has set up four Private Equity Funds in India viz. Tata Capital Growth Fund I, Tata Capital Healthcare Fund I, Tata Capital Innovations Fund and Tata Capital Special Situations Fund-Trust. These Funds have been registered with SEBI as Venture Capital Funds. The Company has sponsored these Funds and acts as their Investment Manager and has also invested in the Funds by subscribing to units of these Funds. In addition to the above, the Company's subsidiary in Singapore has set up Tata Capital Growth Fund Limited Partnership ("LP"), Tata Capital HBM Healthcare Fund I LP and Tata Opportunities Fund LP.

The performance of the above Funds is reviewed below:

i) Tata Capital Growth Fund I ("TCGF")

TCGF targets private equity growth capital investments in companies that have a significant portion of their operations in India. TCGF aims to provide growth capital funding of around Rs. 50 crore to mid-market companies with an average holding period of three to five years. TCGF's investment focus themes are Urbanization, Manufacturing, Strategic Services and

Growth Opportunities. TCGF declared its final close in June 2011 with commitments ofRs. 339 crore of which Rs. 157 crore is invested in portfolio companies as at March 31, 2014.

ii) Tata Capital Healthcare Fund I ("TCHF")

TCHF focuses on private equity growth capital investments in companies in the pharmaceutical, contract research/ manufacturing, healthcare services, medical devices, diagnostic and other healthcare sectors. TCHF seeks investments in healthcare companies with high growth potential and a favourable risk-reward balance. TCHF declared its final close in April 2012, with commitments of Rs. 320 crore, of which Rs. 110 crore has been invested, as at March 31, 2014, in portfolio companies.

iii) Tata Capital Innovations Fund ("TCIF")

TCIF focuses predominantly on technology led innovations which represent breakthrough, fundamental or incremental changes in technology or process. TCIF is a sector agnostic fund and invests across all stages of an enterprise provided the proof of concept is established. TCIF declared its final close in April 2012 with commitments of Rs. 287 crore, of which Rs. 79 crore has been invested, as at March 31, 2014, in portfolio companies.

iv) Tata Capital Special Situations Fund-Trust ("TCSSF")

TCSSF focuses on investing in turnaround opportunities and it declared a final close with commitments of Rs. 360 crore, essentially from Public Sector Banks in India. However, due to regulatory restrictions, the aggregate utilizable commitment is only Rs. 267 crore. Of this, the Fund has invested Rs. 159 crore in portfolio companies.

v) Overseas Funds

The Overseas Funds viz. Tata Capital Growth Fund LP ("TCGFLP"), Tata Capital HBM Healthcare Fund I LP ("TCHHFLP") and Tata Opportunities Fund LP ("TOF") are based in Singapore and are set up by TCPL. These funds accept commitments only from overseas investors. TCGFLP declared its final close in November 2011 with commitments of US$ 167 million, of which US$ 56 million has been invested, as at March 2014, in portfolio companies. TCHHFLP declared it first close in March 2014 and has commitments of USD 8 million at 31 March 2014. The Fund is expected to declare its final close in FY 2014-15. TCHHFLP has not yet invested in portfolio companies. TOF declared its final close in March 2013 with commitments of US $ 545 million of which US $ 124 million has been invested in portfolio companies (excluding follow on commitments). TCL has a co-investment arrangement with TOF whereby TCL has agreed to co-invest a Rupee equivalent of an amount of upto USD 50 million alongside TOF, subject to regulatory restrictions.

7. ALLIANCES

Tata Capital's alliances and partnerships are based on and are an extension of its core objects and values. These include alliances with:

- Mizuho Securities Company Limited, to foster business co-operation in private equity, investment banking (including cross border mergers and acquisitions), securities business (including broking and distribution), structured finance and other business areas such as wealth management.

- Mizuho Corporate Bank Limited, to foster business co-operation, enhance cross-market value creation capabilities and strengthen competitive advantages in addition to aiding each other in gaining a deeper understanding of the Indian and Japanese markets.

- Mitsubishi UFJ Securities Company Limited, to establish a basis for co-operation in a wide range of strategic business areas that include cross-border investment banking, global offering of Indian equities and working towards development of a local bond market.

- International Finance Corporation, Washington, (a member of the World Bank Group), to foray into the area of Climate Change with the formation of Tata Cleantech Capital Limited.

- Century Tokyo Leasing Corporation to cooperate with and assist each other in connection with the operation of the Leasing Division of TCFSL and all other aspects related to the purchase of assets for leasing, hire purchase to corporate customers in India, sale of leased assets to any person and to establish at a future date a joint venture company for carrying on leasing business in India.

- AIMIA (formerly known as Groupe Aeroplan Inc.), the Canadian Loyalty Management giant, to launch a multi-party coalition loyalty program in India modeled on the lines of Nectar, which is GroupAeroplan's highly acclaimed coalition loyalty program in the UK and Italy.

8. CONSOLIDATED FINANCIAL STATEMENTS

In addition to the Unconsolidated Financial Statements of the Company for the FY ended March 31, 2014, the Company has also prepared the Consolidated Financial Statements of the Company and all its subsidiaries, in accordance with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006. Both these sets of Financial Statements are included in the Annual Report of the Company.

Pursuant to the consent of the Board of Directors of the Company and the General Circular No. 1/2011 dated February 8, 2011 issued by the Ministry of Corporate Affairs, the Company is exempted from attaching to its accounts for the FY ended March 31, 2014, the individual Annual Reports of its subsidiary companies. A statement containing brief financial details of each of the Company's subsidiaries for the year ended March 31, 2014 is included in the Annual Report at Page No. 126. The annual accounts of the subsidiaries and the related detailed information will be made available to any Member of the Company and its subsidiaries seeking such information at any point of time and will be available for inspection to any Member of the Company and its subsidiaries at the Registered Office of the Company and will also be posted on the Company's website www. tatacapital.com. The annual accounts of the said subsidiaries will also be available for inspection at the Registered Offices of the respective subsidiary companies and on request, will be made available/sent free of cost to the Members.

9. FINANCE

During FY 2013-14, the Company met its funding requirements through issue of Cumulative Redeemable Preference Shares having tenure of 7 years aggregating Rs. 479.26 crore with Put and Call option at the end of 4 Years. The Company also borrowed Rs. 525 crore by way of short term instruments such as Commercial Papers and Inter Corporate Deposits. The aggregate debt outstanding as at March 31, 2014 was Rs. 270 crore, all of which was payable within one year.

The Debt Equity ratio of the Company as at March 31, 2014 was 0.16 times.

The Company has been regular in repayment of its borrowings and payment of interest thereon.

10. CREDIT RATING

During the year under review, the Company had its Short Term instruments rated and re-affirmed by ICRA Limited as ICRAA1+ and by CRISIL as CRISIL A1+. Further, the Cumulative Redeemable Preference Shares issued by the Company were rated as CRISIL AA+/Stable by CRISIL Limited.

11. RISK MANAGEMENT

Tata Capital manages risk through a detailed Risk Management Policy framework. The Risk Management framework lays down guidelines in identifying, assessing and managing risks that the businesses are exposed to. Risk is managed by the Board/Risk Management Committee of the Board through appropriate structures that are in place at Tata Capital, including suitable reporting mechanisms.

12. INTERNAL CONTROL SYSTEMS

Tata Capital's internal control system is designed to ensure operational efficiency, protection and conservation of resources, accuracy and promptness in financial reporting and compliance with laws and regulations. The internal control system is supported by an internal audit process for reviewing the adequacy and efficacy of the internal controls including its systems and processes and compliance with regulations and procedures. Internal Audit Reports are discussed with the management and are reviewed by the Audit Committee of the Board which also reviews the adequacy and effectiveness of the internal controls. Tata Capital's internal control system is commensurate its size, nature and operations.

13. IT SUPPORT

During FY 2013-14, Tata Capital stabilized its core lending systems and made significant progress towards its goal of total automation of all its business processes. At Tata Capital, there is emphasis on continual improvement and upgradation of systems and the underlying processes. The projects on the IT road map and the digital strategy initiative should enable us to take the technology lead leadership position with the support of our IT partners.

14. HUMAN RESOURCES

Tata Capital recognizes people as its most valuable asset and it has built an open, transparent and meritocratic culture to nurture this asset. To further sharpen and nurture this culture, Tata Capital has created a Senior Leadership Group ("SLG") consisting of more than 80 of our leaders from across different business units and geographies. The SLG then worked together to co-create Tata Capital's "Culture Statement", which was launched in April 2014, along with revised and sharply focused Mission Statement. Tata Capital has also created Regional Leadership Groups to further disseminate our Culture across the breadth of all our people and operations and work as a key communication link with the senior management.

Talent management is a key people planning tool that provides an integrated means of identifying, selecting, developing and retaining top talent within our organization. Attrition has been managed well and has been below industry benchmarks.

Tata Capital has kept a sharp focus on Employee Engagement. This constant focus on people and engagement has increased the Company's Gallup Engagement scores consistently from 3.98 in 2013 to 4.15 in 2014.

In June 2013, Tata Capital has achieved a key milestone by becoming the first NBFC globally by being assessed at P-CMM Level 3. Tata Capital was also awarded the CII HR Excellence Award -Strong Commitment to HR Excellence' in September 2013.

15. TATA BUSINESS EXCELLENCE MODEL ("TBEM")

Tata Capital continues to enhance its capabilities and processes in keeping with market and regulatory changes, using the framework of the Tata Business Excellence Model (based on Baldridge Criteria, USA), which covers aspects of Leadership and Governance, Strategic Planning, Customer Focus, Measurement, Analysis & Knowledge Management, Workforce Focus and Operations Focus. Tata Capital participated in its first ever TBEM external assessment conducted by Tata Quality Management Services (a division of Tata Sons Limited) in November 2013 and was placed in 450-500 score band indicating "good performance". This result for a company undergoing its first external assessment is commendable.

The assessment provided us with important feedback in terms of our current strengths and opportunities for improvements to work towards in the coming year. Key Strengths indicated in this report were the organization alignment with the Vision, Building capability and structure for achieving the vision, Focus on building quality book, Internal Audit mechanism and governance mechanisms.

Tata Capital also successfully underwent ISO 9001:2008 surveillance audit, without any major non conformity, currently only the operations of the assets business is under scope of ISO 9001:2008. It is planned to increase the scope in a phased manner during the coming recertification audits. Tata Capital also is beginning to implement Lean Six Sigma as a tool for improving its operational focus in order to enhance customer satisfaction and improve internal efficiencies.

16. THE TATA CAPITAL BRAND

Over the last five years, through innovative communication campaigns and initiatives, Tata Capital has developed as a strong emergent brand in the financial services sector.

In 2013-14, Tata Capital launched a unique initiative called the 'Do Right' initiative, taking forward its brand promise-'We only do what's right for you'. The initiative is aimed at spreading the spirit of 'doing right' by inspiring people to 'do right', providing platforms to 'do right' and doing right itself. The Tata Capital 'Do Right' signature song was created-written by eminent lyricist Gulzar, composed and performed by Shankar Ehsaan Loy and sung by Shankar Mahadevan. The 'Do Right' initiative was further bolstered by stalwarts like Pandit Shiv Kumar Sharma, Pandit Hariprasad Chaurasia, Ustad Amjad Ali Khan and Ustaad Zakir Hussain. In November 2013, the Company launched-'Half Stories-the Journey of Doing Right', a 2,000 km journey across some of India's remotest locations, discovering everyday stories of courage and unfulfilled needs. These incomplete ('half') stories were completed by people from all walks of life, putting the brand philosophy of do right on a larger worldwide stage.

As we look ahead, the brand will look at strengthening its presence in the digital world, as well as sharpen its focus on delivering more direct business results. 'Digital' as a channel, will increase in importance and be integrated into an end-to-end customer experience from acquisition to customer service. The brand will look at going deeper into the products of the Company and bring out effective product-led campaigns. Brand Tata Capital will continue to contribute to the Company becoming the 'most admired financial solutions partner' and on its promise of "We only do what's right for you".

17. BUSINESS DEVELOPMENT

During FY 2013-14, Tata Capital initiated opportunities and harnessed its extensive relationship network within and outside the Tata Group, to the benefit of its various businesses. Additionally, Tata Capital continued its regular interactions and deepened relationships with trade bodies of Canada, Germany, Scotland, Sweden, the Netherlands and Australia, among others, to further its potential business interests in and from these geographies, as also its interactions with domestic industry and trade bodies, and with other entities, with a view to promoting the Tata Capital brand and laying the groundwork for future business.

18. REPORT UNDER THE PREVENTION OF SEXUAL HARASSMENT ACT ("POSH")

There were no complaints reported by the POSH Committee during FY 2013-14 in its Annual Report to the District Office under the Prevention of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

19. CORPORATE SUSTAINABILITY ("CS")

Tata Capital's Corporate Sustainability policy outlines four thrust areas of development viz. Livelihood & Employability, Health, Education and Environment. Through its initiatives, Tata Capital has many long term associations with NGOs that make a measurable positive difference in each of the focus areas.

Tata Capital believes in social equity and the principle of equal opportunity, irrespective of caste or creed. The Affirmative Action programme at Tata Capital seeks to promote access to quality education and technical skills and competencies for members of the SC/ST communities, thus creating economic independence and sustainable livelihoods. The Vatsalya Ashramshala in Vikramgad district is a residential school for tribal children. Tata Capital supports the development of this school by funding infrastructure and education initiatives.

Tata Quality Management Services facilitates an annual review of the Affirmative Action program. This year the assessment placed Tata Capital in the score band of 40-50, which was an improvement in band score over the previous year.

20. COMPLIANCE

The Company is registered with RBI as a systemically important non-deposit accepting CIC. The Company has complied with and continues to comply with the applicable Regulations and Directions of the RBI for a CIC, and it does not carry on any activities other than those specifically permitted by the RBI for CICs.

21. DEPOSITS

The Company has not accepted any public deposits during the year under review.

22. DIRECTORS

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, Mr. Hoshang Sinor and Mr. Farrokh Subedar, Directors, are liable to retire by rotation at the ensuing Annual General Meeting of the Company. Mr. Sinor has not sought re-election upon such retirement, in order to meet with the requirements under the Companies Act, 2013 relating to the number of directorships that an individual can hold. The Directors place on record their appreciation of the invaluable contribution and guidance provided by Mr. Sinor during his tenure as a Director of the Company.

In accordance with the provisions of Section 149 of the Companies Act, 2013 and the Rules made there under, which came into effect from April 1, 2014, approval of the Members will be sought at the ensuing Annual General Meeting of the Company for formalizing the appointment of Mr. Janki Ballabh, Director as an Independent Director of the Company not liable to retire by rotation, for a term until October 23, 2017.

23. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Directors, based on the representation received from the Operating Management, confirm that:

i) In the preparation of the annual accounts for the FY ended March 31, 2014, the applicable accounting standards have been followed and there are no material departures;

ii) They have, in selection of the accounting policies, consulted the Statutory Auditors and have applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2014, and of the profit of the Company for the year ended on that date;

iii) They have taken proper and sufficient care, to the best of their knowledge and ability, for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

iv) They have prepared the annual accounts of the Company on a 'going concern' basis.

24. CORPORATE GOVERNANCE

A summary of the corporate governance measures adopted by the Company is given below:

i) The Company recognizes its role as a corporate citizen and endeavors to adopt the best practices and the highest standards of corporate governance through transparency in business ethics, accountability to its customers, government and others. The Company's activities are carried out in accordance with good corporate practices and the Company is constantly striving to better them by adopting the best practices.

The Company believes that good corporate governance practices enable the management to direct and control the affairs of the Company in an efficient manner and to achieve the Company's goal of maximizing value for all its stakeholders. The Company will continue to focus its resources, strengths and strategies to achieve its vision of becoming a leading financial services company in India, with a global footprint, while upholding the core values of transparency, integrity, honesty and accountability, which are fundamental to Tata companies.

As a part of the Tata Group, Tata Capital has a strong legacy of fair, transparent and ethical governance practices. The Company's corporate governance philosophy has been further strengthened with the adoption by the Company of the Tata Business Excellence Model, the Tata Code of Conduct, a Code of Conduct for Prevention of Insider Trading, a Code of Corporate Disclosure Practices, a Whistle Blower Policy, a Fair Practices Code, an Affirmative Action Policy and a Policy against Sexual Harassment in the Workplace and an Occupational Health & Safety Management System.

ii) The Board of Directors along with its Committees provides leadership and guidance to the Company's management and directs, supervises and controls the activities of the Company.

iii) The size of the Board is commensurate with the size and business of the Company. At present, the Board comprises six Directors viz. Mr. F K Kavarana, Mr. Ishaat Hussain, Mr. H N Sinor, Mr. Janki Ballabh, Mr. F N Subedar and Mr. Praveen P Kadle. Mr. Kadle is the Managing Director & Chief Executive Officer ("MD & CEO") of the Company and the other five Directors are Non-Executive Directors ("NED"). Board Meetings of the Company are chaired by Mr. F K Kavarana, NED.

iv) Mr. Kadle was re-appointed as the MD & CEO of the Company as also of TCFSL, for a further period of 5 years commencing September 18, 2012.

As at March 31, 2014, Mr. Kadle held 13,78,580 Equity Shares and 80,000 unvested options for purchase of Equity Shares of the Company under the Company's Employee Stock Purchase/Option Scheme ("ESOP Scheme").

It was decided at the Nomination and Remuneration Committee Meeting held on May 8, 2014 and at the Board Meeting held on the same day, to pay Incentive Remuneration of Rs. 2.10 crore to Mr. Kadle for FY 2013-14. With this, the total remuneration of Mr. Kadle for FY 201314 is Rs. 3.82 crore.

v) No commission is proposed to be paid to the NEDs of the Company for FY 2013-14. Details of Equity Shares held by the NEDs as on March 31, 2014 are given below:

These Equity Shares were acquired by the NEDs under the ESOP Scheme.

vi) The Board has constituted Committees with specific terms of reference to focus on specific issues and ensure expedient resolution of diverse matters. These include the Audit Committee, Nomination and Remuneration Committee, ESOP Committee, Finance and Asset Liability Supervisory Committee, Risk Management Committee, Shareholders Grievance Committee and CSR Committee. Several meetings of the committees were held during the year.

Tata Capital has an Audit Committee comprising three NEDs viz. Mr. Janki Ballabh, as Chairman, Mr. H. N. Sinor and Mr. F. N. Subedar. The Board has adopted the Audit Committee Charter which lays down the role, responsibilities and powers of the Audit Committee.

During FY 2013-14, 7 meetings of the Board of Directors and 6 meetings of the Audit Committee were held. The details of attendance at Board Meetings, Audit Committee Meetings and the previousAnnual General Meeting of the Company are given below:

Sitting fees for attending Board Meetings and Meetings of Committees of the Board are paid to NEDs within the maximum prescribed limits. Sitting fees paid to the NEDs for the meetings held during FY 2013-14 were as under:

Minutes of meetings of all Committees of the Board are placed before the Board for discussion/noting. A quarterly summary of the minutes of the meetings of the Boards of the Company's subsidiaries is also placed before the Board for noting.

The Company Secretary is the Secretary of all the aforementioned Committees, except that the Head of the HR function at Tata Capital is the Secretary of the Nomination and Remuneration Committee and the ESOP Committee.

vii) The Company has signed the Tata Brand Equity and Business Promotion ("BEBP") Agreement with Tata Sons Limited subscribing to the TATA BEBP Scheme. The Company abides by the Tata Code of Conduct and the norms for using the Tata Brand identity.

viii) The Company and its employees, including the MD & CEO have adopted the Tata Code of Conduct. In addition, the Company has also adopted a Code of Conduct for its NEDs. The aforesaid Codes have been posted on the Company's web-site.

ix) The Company has adopted a Whistle-Blower Policy which provides a formal mechanism for all employees of the Company to make protected disclosures to the management about unethical behavior, actual or suspected fraud or violation of the Company's Code of Conduct. The disclosures reported are addressed in the manner and within the time frames prescribed in the Policy. No employee of the Company has been denied access to the Audit Committee.

x) The Company Secretary is the Compliance Officer of the Company.

xi) The Company's website is www.tatacapital.com

25. ACCOUNTS AND ACCOUNTING STANDARDS

The Company adheres to the Accounting Standards notified under the Companies (Accounting Standard) Rules, 2006 in the preparation of its financial statements and also to the guidelines prescribed by the RBI.

26. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO

In view of the nature of the activities carried out by the Company, Rules 2A and 2B of the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, relating to conservation of energy and technology absorption, are not applicable to the Company.

During the year under review, the Company had Nil earnings in foreign exchange (Previous Year: Nil) and an outgo of Rs. 0.90 crore in foreign exchange (Previous Year: Rs. 0.65 crore).

27. PARTICULARS OF EMPLOYEES

Information in accordance with sub-section (2A) of Section 217 of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 and forming part of the Directors' Report for the year ended March 31, 2014, is provided in an Annexure forming part of this Report. The Report and Accounts are being sent to the Members excluding the aforesaid Annexure. Any Member interested in obtaining a copy of the same may write to the Company Secretary requesting for the same.

28. TATA CAPITAL LIMITED EMPLOYEE STOCK PURCHASE/OPTION SCHEME

In order to develop and implement a long term incentive program to effectively attract, motivate and retain the best talent from the industry in a competitive environment, the Members of the Company at their Meeting held on March 2, 2010, approved a 'Tata Capital Limited Employee Stock Purchase/Option Scheme' ("ESOP Scheme"), which was earlier approved by the Board of Directors on February 1, 2010.

Based on the recommendations of the ESOP Committee, 2,20,01,618 Equity Shares of TCL ("Shares") were offered to the Eligible Employees and NEDs of Tata Capital upto March 31, 2014. Options for purchase of 3,32,24,745 Shares have been granted under the ESOP Scheme to Eligible Employees.

29. AUDITORS

Deloitte Haskins & Sells LLP (formerly known as M/s Deloitte Haskins & Sells) ("DHS"), who are the Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting ("AGM") and are eligible for re-appointment.

DHS was appointed as the Auditors of the Company at the AGM of the Company held on July 17, 2007 for the F.Y. 2007-08 and have been re-appointed thereafter, at every AGM of the Company. At the conclusion of the ensuing AGM of the Company, DHS will complete a period of seven years as the auditors of the Company. As per the provisions of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, it is proposed to re-appoint DHS as the Auditors of the Company to hold office from the conclusion of this Meeting until the conclusion of the next AGM of the Company.

30. GREEN INITIATIVE

Section 136 of the Companies Act, 2013 and the Rules made there under allow the Company to send its financial statements by electronic mode to such members whose shareholding is in dematerialized format and whose email addresses are registered with Depository for communication purposes. As a responsible corporate citizen, the Company proposes to effect electronic delivery of the Annual Report of the Company in lieu of the paper form to the Members who have registered their email IDs with the Depositories. Physical copy of the Annual Report will be sent to those Members who have not registered their email addresses with the Depositories for receiving electronic communication. A physical copy of this Annual Report can also be obtained free of cost by any Member from the Registered Office of the Company on any working day during business hours.

A copy of this Annual Report along with the annual report of each of the Company's subsidiaries for FY 2013-14 is also available on the website of the Company, www.tatacapital.com.

31. ACKNOWLEDGEMENTS

The Directors would like to place on record their gratitude for the valuable guidance and support received from the Reserve Bank of India, Securities and Exchange Board of India, National Housing Bank, Monetary Authority of Singapore, Financial Conduct Authority, UK and other government and regulatory agencies and to convey their appreciation to Tata Sons Limited (the holding company), the Members, customers, bankers, lenders, vendors and all other business associates for the continuous support given by them to Tata Capital. The Directors also place on record their appreciation of all the employees of Tata Capital for their commitment, commendable efforts, team work and professionalism.