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TO THE MEMBERS,

The Directors have pleasure in presenting the Annual Report of the Company along with Audited Accounts for the financial year ended March 31, 2021.

The summary of the financial results of the Company for the financial year ended March 31, 2021 is as under:

Dividend

In view of the losses, no dividend has been recommended for the financial year ended March 31, 2021.

Operations of the Company

The total income of the Company during the financial year under review was Rs. 246.89 lakhs as against Rs.1773.41 lakhs in the previous financial year. The decrease in income was primarily due to reduction in profit on sale of investments, lower dividends received, reduction in provision no longer required written back and drop in service income. The total expenditure during the year was Rs.360.55 lakhs as against Rs.2461.49 in the previous financial year. The decrease in expenditure was due to reduction in employee costs, finance costs, professional expenses and provisions. The net loss during the year was Rs.113.66 lakhs as against a loss of Rs.684.09 lakhs in the previous year.

The spread of the Covid-19 pandemic has brought economic activity to a near standstill in the first half of FY 2020-21. India's (FY 2020-21) GDP is estimated to have contracted by 7.7% Y-o-Y and it has taken a dramatic toll on lives and livelihoods. With continued uncertainty, it is evident that the post- pandemic existence will be unavoidably different. The pandemic has also impacted the company's efforts towards finding a resolution for the exingent issues prevailing upon it. Despite the challenging situation, the company is working towards finding a solution.

Market Value of Company's investment

The Company's net worth, taking into account the market value of the Company's investments, would be more than adequate to meet its liabilities and to continue its operations in future.

Future Prospects

Your Company is in the category of NBFC CIC (exempted) and it continues to hold strategic investments in different companies. The dividend distribution by the investee companies contributes to the Company's revenue. However, the Company vide letter dated August 3, 2021 has sought advice from RBI regarding applicability of NBFC rules / application for grant of Certification for becoming CIC-NDSI in view of company's assets being valued at market rate on application of IND AS.

Your Company has entered into advisory and consultancy services which under the existing circumstances, can be carried on advantageously along with the existing activities of the Company to augment the revenue of the Company. In order to strengthen the prospects of the Company, your Directors/Management continue to evaluate options to enter into additional activities but the attachment of the Company's investments by the Regulators has affected the cash flow position of the Company and the process of evaluating options has been adversely affected. The Company nevertheless would continue to evaluate future business options based on the changing business and external environment.

Directors and Key Managerial Personnel

Ms. Sarvamangala Hadapada (DIN - 08395454) was appointed as an Additional Director in the category of Non-Executive Independent Woman Director w.e.f October 22, 2020. The Nomination and Remuneration Committee has recommended the appointment of Ms. Sarvamangala Hadapada as Independent Director. The appointment is subject to the approval of the Shareholders.

Mr. G. Sreenivas (DIN - 07805594) was appointed as an Additional Director in the category of Non-Executive Director w.e.f November 13, 2020. The Nomination and Remuneration Committee has recommended the appointment of Mr. G. Sreenivas as a Non- Executive Director. The appointment is subject to the approval of the Shareholders.

Mr. Theerthesh B.S. (DIN - 08955326) was appointed as an Addition Director in the Category of Non-Executive Independent Director w.e.f November 13, 2020. The Nomination and Remuneration Committee has recommended the appointment of Mr. Theerthesh B.S. as Independent Director. The appointment is subject to the approval of the Shareholders.

Ms. Tushita Patel, a Non-Executive Woman Director, Mr. Raghuveeran Kasargod and Mr. Girish Datar both being Non-Executive Independent Directors of the Company resigned as a Director of the Company w.e.f October 12, 2020 and November 18, 2020 respectively.

The Board of Directors places on record their appreciation for the contribution by Ms. Tushita Patel, Mr. Raghuveeran Kasargod and Mr. Girish Datar during their tenure as Non-Executive Woman Director and as Independent Directors of the Company respectively.

Mr. Ajay Kumar Vijay, Executive Director of the Company resigned w.e.f November 18, 2020. The Board of Directors places on record their appreciation for the contribution by Mr. Ajay Kumar Vijay during his tenure as an Executive Director of the Company.

Mr. Arindam Ash, the Chief Financial Officer and Key Managerial Personnel of the Company resigned from the services of the Company w.e.f. November 16, 2020 and efforts are continuing to identify a successor. The Board of Directors places on record their appreciation for the contribution by Mr. Arindam Ash during his tenure as Chief Executive Officer of the Company.

Mr. Manoj Kumar, Company Secretary, Compliance Officer and Key Managerial Personnel resigned from the services of the Company w.e.f. December 10, 2019 and efforts are continuing to identify a successor.

The affairs of the Company are conducted under the overall supervision and guidance of the Board of Directors of the Company.

None of the Directors of the Company are disqualified under Section 164 (2) of the Companies Act, 2013. Your Directors have made necessary disclosures as required under the provisions of the Companies Act, 2013.

Directors' Responsibility Statement

The Board of Directors of the Company hereby state that:

(a) in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed along with proper explanation relating to material departures;

(b) accounting policies have been selected and applied consistently and the judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at the end of the financial year and of the loss of the Company for that period;

(c) proper and sufficient care has been taken 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 prevention and detection of fraud and other irregularities;

(d) the Annual Accounts have been prepared on a going concern basis;

(e) Internal Financial Controls have been laid down to be followed by the Company and that such Internal Financial Controls are adequate and operating effectively and

(f) proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

Statutory Auditors

(a) Appointment of Statutory Auditors:

The Members of the Company had appointed M/s. BVC & Co., Chartered Accountants, (Firm Registration No. 008154S) as the Statutory Auditors of the Company for a period of five years commencing from the conclusion of the Thirteenth Annual General Meeting to the conclusion of the Eighteenth Annual General Meeting of the Company. The Auditors have confirmed that they continue to fulfill the criteria for appointment as Auditor of the Company as prescribed under the Act and the Rules framed thereunder.

(b) Auditor's Qualifications and Board responses:

Certain issues relating to Company's income stream and its effect on the going concern aspects, is the subject matter of Qualification in the Audit Report. This Qualification has been explained in Note no. 34 of the financial statements.

Corporate Governance & Management Discussion and Analysis Reports

Pursuant to the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, (SEBI LODR) a Report on Corporate Governance and Management Discussion and Analysis Report are attached to this Report.

The Auditor's Certificate confirming compliance of conditions of Corporate Governance is appended to this report. CEO/CFO Certificate as required under Regulation 17 of the SEBI LODR could not be signed in absence of a CEO/CFO of the Company..

Board and its Committees

The details of the meetings of the Board and its Committees held during the financial year, the composition of the board and all of its committees are given in the Report on Corporate Governance. All the recommendations made by the Audit Committee and Nomination and Remuneration Committee from time to time were accepted by the Board.

Declarations by Independent Directors

The Company has received declarations from the Independent Directors that they meet the criteria of independence as provided in sub-section (6) of Section 149 of the Companies Act, 2013 and listing regulations.

Performance Evaluation of the Board and it's Committees

The details of annual evaluation made by the Board of its own performance and that of its committees, individual Directors individually and performance criteria for Independent Directors laid down by the Nomination and Remuneration Committee are enclosed as Annexure - A to this Report. The policy for performance evaluation of the Independent Directors and Board of Directors is available on the Company's website www.mcdowellholdings.co.in.

Details of remuneration to Directors

During the year under review, remuneration was paid to the Executive Director. The NonExecutive Directors were paid sitting fee for attending the committee and board meetings and reimbursement of actual travel expenses, boarding and lodging, conveyance and incidental expenses incurred in attending such meetings.

Particulars of Employees and Related Disclosures

Disclosures with respect to the remuneration of Directors and Employees as required under Section 197 of Companies Act, 2013 and Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been appended as Annexure D to this Report.

The Company had not offered any shares to its employees or Key Managerial Personnel under any scheme of Employees Stock Option and has also not issued any sweat equity at any time.

Deposits

During the year under review, your Company did not accept any deposits within the meaning of provisions of Chapter-V, (Acceptance of Deposits by Companies) of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

Corporate Social Responsibility (CSR)

The Company has constituted a Corporate Social Responsibility Committee as required under Section 135 of the Companies Act, 2013. Since the average net profit of the Company for the preceding three financial years was negative, there was no necessity for the Company to carry out any CSR spending for the period under review.

Secretarial Audit

(a) Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has appointed Mr. K N Nagesha Rao (C.P.No.12861/Membership No. FCS 3000, Company Secretary in Practice to undertake the Secretarial Audit of the Company. The Report furnished by Auditor in the format prescribed is enclosed as Annexure - E to this report.

(b) Qualifications and Board responses

The Board responses to the qualifications of the Secretarial Audit are as under:

(i) Consequent to the resignation of the Company Secretary from the services of the Company w.e.f. December 10, 2019, the Company engaged HR placement agencies and head-hunters to fill up the post. Due to the attachment of the Company's investments and also the freezing of the Company's demat account by the Enforcement Directorate ( in connection with their investigation against Kingfisher Airlines Limited, Dr. Vijay Mallya / Ors) the generation of funds to pay salary, dues and other administrative expenses have been adversely affected. In view of these facts, the candidates identified by the Placement Agency did not agree to join the Company. Apart from these candidates, few more candidates also disagreed to join on the same grounds. The Company is continuing in its efforts to fill the vacancy.

(ii) The Chief Financial Officer and executive director of the Company resigned from the services of the Company w.e.f. November 16, 2020 and November 18, 2020 respectively. Due to the attachment of the Company's investments and also the freezing of the Company's demat account by the Enforcement Directorate ( in connection with their investigation against Kingfisher Airlines Limited, Dr. Vijay Mallya / Ors) the generation of funds to pay salary, dues and other administrative expenses have been adversely affected. In view of these facts, the candidates disagreed to join on the Company. The Company is continuing its efforts to fill the vacancy.

Internal Control System

The Company has a robust system of internal control, the effectiveness of which is tested by the process of internal audit under the supervision of Audit Committee. Your Company through internal audit under the supervision of the Audit Committee reviews the risk management process, risk mitigation plans and risk reporting.

The adequacy and effectiveness of Internal Financial Controls have been endorsed by the Internal Auditor and the Statutory Auditors. The report of the Independent Statutory Auditors in the annexure to their Audit Report does not contain any adverse observations.

Vigil Mechanism

The Company has implemented a vigil mechanism to provide a framework for the Company's employees and Directors to promote responsible and secure whistle blowing. It protects the employees who raise concern about serious irregularities within the Company, if any. A brief summary of the vigil mechanism implemented by the Company is set out in Annexure - B to this report.

Your Company hereby affirms that no Director/employee has been denied access to the Chairman of the Audit Committee and that no complaints were received during the year under review. The Whistle Blower Policy is available in the Company website, www. mcdowellholdings.co.in.

Share Capital

The Authorised Share Capital of the Company stands at Rs.15,00,00,000 comprising of 150,00,000 equity share of Rs.10 each and the issued, subscribed and paid up capital of the Company as on March 31, 2021 remain unchanged at Rs.13,99,22,580 comprising of 1,39,92,258 equity shares of Rs.10 each.

Depository System

The trading in the equity shares of your Company is under compulsory dematerialisation mode. As the depository system offers numerous advantages, members are requested to take advantage of the same and avail the facility of dematerialisation of the Company's shares. Moreover, transfer of shares of the Company by physical means has been barred from April 1, 2019 pursuant to SEBI's Notification dated December 3, 2018.

Listing Requirements

Your Company's Equity Shares are listed on the BSE Limited and National Stock Exchange of India Limited. The listing fees have been paid to both the Stock Exchanges for the year 2021-2022.

Annual Return

As required under sub-section (3) of Section 92 of the Act as amended by the Companies (Amendment) Act, 2017, the Company has placed a copy of the Annual Return in Form MGT-7 on its website www.mcdowellholdings.co.in through the link http://mcdowellholdings.co.in/investors/others.

Nomination and Remuneration Policy

The Board on the recommendation of the Nomination and Remuneration Committee has laid down a policy for the appointment and remuneration of the Directors, Key Managerial Personnel and Senior Executives of the Company. The same is set out in Annexure - C to this report.

Particulars of Loans, Guarantees or investments

Details of loans, guarantees and investments covered under Section 186 of the Companies Act, 2013 are given in Note 4 & 12 of the Notes to the Financial Statements.

Subsidiary, Associates and Joint Ventures

The Company does not have any Subsidiary, Associates and Joint Ventures.

Related Party Transactions

During the year under review, all contracts/arrangements entered by your Company with related parties, were on an arm's length basis and in the ordinary course of business, and did not consummate material transactions with any related party as defined in the Act. All related party transactions, entered for the year under review, have been approved by the Audit Committee, wherever applicable.

Transactions with related parties as per the requirements of Accounting Standards 18 issued by The Institute of Chartered Accountants of India are disclosed in the relevant Schedule of Notes to Annual Accounts. The Policy for Related Party Transactions is available on the Company's website: www.mcdowellholdings.co.in.

Familiarisation Programme for Independent Directors

The details of programmes for familiarisation of the Independent Directors, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are available on the Company's website: www.mcdowellholdings.co.in.

Energy Conservation, Technology Absorption, Foreign Exchange Earnings and Outgo

The provisions under Section 134 of the Companies Act, 2013 and rules made there under relating to energy conservation, technology absorption do not apply to the Company, as the Company is not engaged in the manufacturing activities. There were no foreign exchange earnings or outgo during the year under review.

Sexual harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

There were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Acknowledgement

Your Directors wish to acknowledge the co-operation and support extended by the employees and the shareholders of the Company.