1.1  Background

Coffee Day Enterprises Private Limited (Formerly Coffee Day Resorts Private Limited) (CDEPL or the Company) was incorporated as a private limited company under the Companies Act, 1956 on 20 June 2008 by conversion of erstwhile partnership firm M/s Coffee Day Holding Co. The registered office of the Company is located in Bangalore, India.

CDEPL is the holding company of the Coffee Day Group. The investee companies of the Group set out in the table below have business interests across multiple sectors such as retail, export of coffee bean, real estate, financial services, logistics, hospitality and IT/ ITeS. Other than being an investment company, on a standalone basis, the Company owns and operates a resort and also renders consultancy services.

 

List of subsidiaries with percentage holding
Subsidiary	Country of incorporation and other particulars	Percentage of holding (%)
Amalgamated Bean Coffee Trading Company Limited ('ABCTCL')	a subsidiary of the Company incorporated under the laws of India	94.94
Amalgamated Holdings Limited (AHL)	a subsidiary of ABCTCL incorporated under the laws of India	94.94
Ganga Coffee Curing Works Limited	a subsidiary of ABCTCL incorporated under the laws of India	94.94
A.N Coffeeday International Limited (AN CCD)	a subsidiary of ABCTCL incorporated under the laws of Cyprus	94.94
Coffee Day Properties (India) Private Limited	a subsidiary of ABCTCL incorporated under the laws of India	94.94
Classic Coffee Curing Works	a partnership firm registered under the laws of India wherein ABCTCL is a significant partner	94.94
Coffeelab Limited (CLL)	a subsidiary of AHL incorporated under the laws of India	94.94
Coffee Day Gastronomie Und Kaffeehandles GmbH	a subsidiary of AN CCD incorporated under the laws of Austria	94.94
Coffee Day CZ a.s.	a subsidiary of AN CCD incorporated under the laws of Czech Republic	94.94
Tanglin Developments Limited ('TDL')	a subsidiary of the Company incorporated under the laws of India	100
Tanglin Retail Reality Developments Private Limited ('TRR')	a subsidiary of TDL incorporated under the laws of India	100
Sical Logistics Limited ('SL')	a subsidiary of TRR incorporated under the laws of India	52.83
Bergen Offshore Logistics Pte. Ltd ('BOFL')	a subsidiary of SL incorporated under the laws of Singapore	52.83
Subsidiary	Country of incorporation and other particulars	Percentage of holding (%)
Norsea Global Offshore Pte Limited	a subsidiary of BOFL incorporated under the laws of India	52.83
Norsea Offshore India Limited	a subsidiary of SL incorporated under the laws of India	52.83
Sical Infra Assets Limited ('SIAL')	a subsidiary of SL incorporated under the laws of India	28.00
Sical Multimodal And Rail Transport Limited ('SMRTL')	a subsidiary of SIAL incorporated under the laws of India	28.00
Sical Sattva Rail Terminal Private Limited	a joint venture of SMRTL incorporated under the laws of India	14.00
Sical Iron Ore Terminal (Mangalore) Limited	a subsidiary of SL incorporated under the laws of India	52.83
Sical Iron Ore Terminals Limited	a subsidiary of SL incorporated under the laws of India	33.28
Ennore Automotive Logistics Limited	a joint venture of SL incorporated under the laws of India	23.77
Psa Sical Terminals Limited	a joint venture of SL incorporated under the laws of India	19.81
Giri Vidhyuth (India) Limited	a subsidiary of TDL incorporated under the laws of India	100
Ittiam Systems Private Limited ('ITSP')	an associate of TDL incorporated under the laws of India	21.92
Ittiam Media Labs Private Limited (Earlier known as Ittiam Semiconductor Private Limited)	a subsidiary of ITSP incorporated under the laws of India	21.92
Ittiam Systems Inc., USA	a subsidiary of ITSP incorporated under the laws of USA	21.92
Ittiam Systems Europe- SARL	a subsidiary of ITSP incorporated under the laws of France	21.92
Ittiam Systems Pte Ltd.,  Singapore	a subsidiary of ITSP incorporated under the laws of Singapore	21.92
Coffee Day Hotels and Resorts Private Limited ('CDHRPL')	a subsidiary of the Company incorporated under the laws of India	100
Wilderness Resorts Private Limited ('WRPL')	a subsidiary of CDRHPL incorporated under the laws of India	100
Karnataka Wildlife Resorts Private Limited	a subsidiary of WRPL incorporated under the laws of India	100
Global Technology Ventures Limited ('GTV')	a subsidiary of the Company incorporated under the laws of India	88.77
Subsidiary	Country of incorporation and other particulars	Percentage of holding (%)
Magnasoft Consulting India Private Limited ('MCIPL')	a subsidiary of GTV incorporated under the laws of India	66.76
Magnasoft Europe Limited	a subsidiary of MCIPL incorporated under the laws of UK	66.76
Magnasoft Spatial Services, Inc.	a subsidiary of MCIPL incorporated under the laws of Denver	66.76
Global Edge Software Limited ('GESL')	an associate of GTV incorporated under the laws of India	21.84
Global Edge Software Inc, USA	a subsidiary of GESL incorporated under the laws of India	21.84
Dearborn Electronics India Private Limited	a subsidiary of GESL incorporated under the laws of India	21.84
Mindtree Limited ('M')	an associate of the Company incorporated under the laws of India	16.9
Mindtree Software (Shanghai) Co., Ltd	a subsidiary of M incorporated under the laws of Republic of China	16.9
Way2Wealth Securities Private Limited ('WSPL')	a subsidiary of the Company incorporated under the laws of India	37.10
Mandi2Market Traders Private Limited (Formerly known as Way2Wealth Institutional Broking Private Limited)	a subsidiary of WSPL incorporated under the laws of India	37.10
Way2Wealth Distributors Private Limited	a subsidiary of WSPL incorporated under the laws of India	37.10
Way2Wealth Capital Private Limited	a subsidiary of WSPL incorporated under the laws of India	37.10
Way2Wealth Realty Advisors Private Limited	a subsidiary of WSPL incorporated under the laws of India	35.24
Way2Wealth Brokers Private Limited ('WBPL')	a subsidiary of WSPL incorporated under the laws of India	37.10
Way2Wealth Insurance Brokers Private Limited	a subsidiary of WSPL incorporated under the laws of India	37.10
Way2Wealth Illuminati Securities Private Limited	a subsidiary of WSPL incorporated under the laws of India	18.92
Way2Wealth Commodities Private Limited	a subsidiary of WBPL incorporated under the laws of India	37.10
Way2wealth Illuminati PTE. LTD.	a subsidiary of WBPL incorporated under the laws of India	37.10
Techno Shares & Stocks Limited ('TSSL')	a subsidiary of WBPL incorporated under the laws of India	31.16
Subsidiary	Country of incorporation and other particulars	Percentage of holding (%)
Techno Commodity Broking Private Limited	a subsidiary of TSSL incorporated under the laws of India	37.10

1.2  Basis of brparation of financial statements

Theses financial statements have been brpared and brsented under the historical cost convention on the accrual basis of accounting and comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (the Act) which as per a clarification issued by the Ministry of Corporate Affairs continue to apply under section 133 of the Companies Act 2013 [which has superseded section 211(3C) of the Companies Act 1956 w.e.f. 12 September 2013], other pronouncements of the Institute of Chartered Accountants of India (ICAI), the provisions of the Companies Act, 2013 (to the extent notified) and the Companies Act, 1956, (to the extent applicable).

All assets and liabilities have been classified as current or non-current as per the Companys normal operating cycle and other criteria set out in the Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current non current classification of assets and liabilities.

1.3  Use of estimates

The brparation of the financial statements in conformity with generally accepted accounting principles in India ('Indian GAAP') requires the Management to make estimates and assumptions that effect the reported amounts of assets and liabilities and the disclosure of contingent liabilities on the date of the financial statements. Actual results could differ from those estimates.  Any revision to accounting estimates is recognised prospectively in the current and future years.

1.4  Fixed assets and debrciation

Fixed assets are stated at the cost of acquisition or construction less accumulated debrciation. The cost of fixed assets includes freight, duties, taxes and other incidental expenses relating to the acquisition and installation of the respective assets.

Advance paid towards the acquisition of fixed assets outstanding at each balance sheet are shown under capital advances. The cost of fixed assets not ready for their intended use before such date, are disclosed as capital work in progress.

Debrciation is provided on a straight line method (SLM) over estimated useful life of the fixed assets. The rates of debrciation brscribed in Schedule XIV to the Companies Act, 1956 are considered as minimum rates. If the Managements estimate of the useful life of the fixed assets at the time of acquisition of the asset or of the remaining useful life on a subsequent review is shorter than that envisaged in the aforesaid Schedule, debrciation is provided at a higher rate based on the Managements estimate of the useful life or remaining useful life.

Pursuant to this policy, debrciation on assets has been provided at the rates based on the following useful lives of these fixed assets as estimated by the Management:

 

Asset category	Estimated useful life (in years)
Plant and machinery	8 years
Furniture and fittings	8 years
Vehicles	6 years
Office equipment	6 years
Computers (including software)	2 years

Pro-rata debrciation is provided on all fixed assets purchased and sold during the year.

Individual assets costing Rs 5,000 or less are debrciated in full on the date of acquisition.

The building built on leasehold land is classified as building and is amortised over the lease term (i.e. 22 years) or the useful life of the building (i.e. 20 years), whichever is lower.

1.5  Revenue recognition

The Company derives its revenue primarily from running and/or managing hotels and resorts and providing consultancy services. Such services income is recognized when the related services are rendered unless significant future contingencies exist.

Sales are disclosed both gross and net of sales tax, services tax, trade discount and quality claims.

Interest on the deployment of funds is recognised using the time-proportion method, based on underlying interest rates.

Advances received from the customers are reported as liabilities until all conditions for revenue recognition are met and is recognized as revenue once the related services are rendered.

Dividend income is recognised when the Company's right to receive dividend is established.

1.6  Investments

Investments are either classified as current or long term based on managements intention at the time of purchase.

Current investments are valued at the lower of cost and fair value as at the balance sheet date determined individually for each investment.

Long-term investments are valued at cost less provision for diminution, other than temporary, to recognise any decline in the value of such investments. Such an assessment is carried out individually for each investment.

Profit or loss on sale of investments is determined as the difference between the sale price and carrying value of investment, determined individually for each investment.

1.7  Employee benefits

Gratuity, which is a defined benefit, is accrued based on an actuarial valuation, carried out by an independent actuary. Actuarial gains and losses are recognized in the statement of profit and loss.

Contributions payable to the recognized provident fund, which is a defined contribution, is charged to the statement of profit and loss on an accrual basis.

1.8  Foreign currency transactions

Foreign currency transactions are recorded at the rates of exchange brvailing on the dates of the respective transactions. Exchange differences arising on foreign exchange transactions settled during the year are recognised in the statement of profit and loss of the year.

Monetary assets and liabilities denominated in foreign currencies as at the balance sheet date are translated at the exchange rates on that date. The resultant exchange differences are recognised in the statement of profit and loss.

1.9  Taxation

Income-tax expense comprises current tax (i.e. amount of tax for the year determined in accordance with the income tax law) and deferred tax charge or credit (reflecting the tax effect of timing differences between accounting income and taxable income for the year). The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognised using the tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty that the assets can be realised in future, however, where there is an unabsorbed debrciation or carry-forward losses under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of such assets. Deferred tax assets are reviewed as at the balance sheet date and written down or written-up to reflect the amount that is reasonably/ virtually certain as the case may be to be realised.

Minimum alternate tax (MAT) paid in a year is charged to the statement of profit and loss as current tax. The Company recognizes MAT credit available as an asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the Company recognises MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income Tax Act, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as MAT Credit Entitlement. The Company reviews the MAT credit entitlement asset at each reporting date and writes down the asset to the extent the Company does not have convincing evidence that it will pay normal tax during the specified period.

The Company off sets on a year on year basis, current tax assets and liabilities where it has a legally enforceable rights to set off and where the Management intends to settle such assets and liabilities on a net basis.

1.10    Provisions and contingent liabilities

Provision is recognised when, as a result of an obligating event, there is a brsent obligation that probably requires an outflow of resources and a reliable estimate can be made of the amount of obligation.

The disclosure of contingent liability is made when, as a result of an obligating event, there is a possible obligation or a brsent obligation that may, but probably will not, require an outflow of resources.

No provision or disclosure is made when, as a result of an obligating event, there is a possible obligation or a brsent obligation where the likelihood of an outflow of resources is remote.

Provisions for onerous contracts, i.e. contracts where the expected unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received under it, are recognised when it is probable that an outflow of resources embodying economic benefits will be required to settle a brsent obligation as a result of an obligating event based on a reliable estimate of such obligation.

1.11    Impairment of assets

The Company at each balance sheet date assesses whether there is any indication that an asset or a group of assets comprising a cash-generating unit may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. For an asset or group of assets that does not generate largely independent cash inflows, the recoverable amount is determined for the cash-generating unit to which the asset belongs. If such recoverable amount of the asset or the recoverable amount of the cash-generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognised in the statement of profit and loss. If at the balance sheet date there is an indication that if a brviously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of debrciable historical cost. An impairment loss is reversed only to the extent that the carrying amount of asset does not exceed the net book value that would have been determined; if no impairment loss had been recognised.

1.12    Earnings/ (loss) per share

The basic earnings/ (loss) per share is computed by dividing the net profit/ (loss) attributable to equity shareholders for the year by the weighted average number of equity shares outstanding during the year. 

The number of shares used in computing diluted earnings/ (loss) per share comprises the weighted average shares considered for deriving basic earnings/ (loss) per share and also the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. 

Dilutive potential equity shares are deemed converted as of the beginning of the year, unless they have been issued at a later date. In computing diluted earnings per share, only potential equity shares that are dilutive and which either reduces earnings per share or increase loss per share are included.

1.13    Cash and cash equivalents

Cash and cash equivalents comprise cash and balances with banks. The Company considers all highly liquid investments with a remaining maturity at the date of purchase of three months or less and that are readily convertible to known amounts of cash to be cash equivalents.

1.14    Cash flow statement

Cash flows are reported using the indirect method, whereby net profit/ (loss) before tax is adjusted for the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated.

1.15    Borrowing cost

Borrowing cost includes interest and ancillary costs incurred in connection with the arrangement of borrowings. Borrowing costs directly attributable to acquisition or construction of those fixed assets which necessarily take a substantial period of time to get ready for their intended use are capitalized. Other borrowing costs are accounted as an expense in the period in which they are incurred. Ancillary costs incurred in connection with the arrangement of borrowings are amortised over the tenure of borrowing.

1.16    Leases

Leases under which the Company assumes substantially all the risks and rewards of ownership are classified as finance leases.  Such assets acquired are capitalised at the fair value of the asset or the brsent value of the minimum lease payments at the inception of the lease, whichever is lower.

Lease payments under operating lease are recognised as an expense in the statement of profit and loss on a straight line basis over the lease term. Lease term is the non-cancellable period for which the Company has agreed to lease the asset together with any further periods for which the Company has the option to continue the lease and at the inception of the lease it is reasonably certain that the Company will exercise such an option.

1.1  Background

Coffee Day Enterprises Private Limited (Formerly Coffee Day Resorts Private Limited) (CDEPL or the Company) was incorporated as a private limited company under the Companies Act, 1956 on 20 June 2008 by conversion of erstwhile partnership firm M/s Coffee Day Holding Co. The registered office of the Company is located in Bangalore, India.

CDEPL is the holding company of the Coffee Day Group. The investee companies of the Group set out in the table below have business interests across multiple sectors such as retail, export of coffee bean, real estate, financial services, logistics, hospitality and IT/ ITeS. Other than being an investment company, on a standalone basis, the Company owns and operates a resort and also renders consultancy services.

1.1  Employee benefits

Gratuity, which is a defined benefit, is accrued based on an actuarial valuation, carried out by an independent actuary. Actuarial gains and losses are recognized in the statement of profit and loss.

Contributions payable to the recognized provident fund, which is a defined contribution, is charged to the statement of profit and loss on an accrual basis.