Annexure on Employee Stock Option Scheme (ESOS) – FY 2017-18

Disclosures pursuant to Regulation 14 of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014. Relevant disclosures in terms of the ‘Guidance note on accounting for employee share-based payments’ issued by ICAI form part of the notes to the financial statements provided in this Annual Report.

S.No. Description Year ended 31st March, 2018

1. Date of shareholders’ approval ESOS-2001 17.10.2001

ESOS-2006 11.10.2006

ESOS-2007 13.10.2007

2. Total number of options approved under ESOS

32,17,500 17,82,500 17,55,720

3. Vesting requirements Commences at the expiry of two years from the date of grant

4. Exercise price or pricing formula

At a discount of 25% on the average of the weekly high and low of the closing prices for the Company’s Equity Shares quoted on the Bombay Stock Exchange and / or National Stock Exchange during the four weeks preceding the date of grant of the options.

5. Maximum term of options granted

4 years

6. Source of shares (primary, secondary or combination)

Primary

7. Variation of terms of options Nil

8 Method used to account for ESOS - Intrinsic or fair value

The company has calculated the employee compensation cost using the fair value of the stock options

9 Difference between the employee compensation cost so computed and the employee compensation cost that shall have been recognized if it had used the fair value of the options

NA

10 The impact of this difference on profits and on EPS of the company on the current year profits (for the year grants)

Profit (Loss) after Tax (Rs. in Lakhs) : Rs.3471.98 Adjusted weighted avg. EPS (in Rs.) : Rs.3.36

Details of ESOS during the financial year

S. No. Description Year ended March 31, 2018

1. Number of options outstanding at the beginning of the year (un-granted)

Nil 5,49,893 9,30,350

2. Number of options granted during the year Nil Nil Nil

3. Number of options forfeited/lapsed during the year

Nil 41,095 28,700

4. Number of options vested during the year Nil Nil 2,90,516

5. Number of options exercised during the year

Nil Nil 2,90,516

6. Number of shares arising as a result of exercise of options

Nil Nil 2,90,516

7. Amount realized by exercise of options (Rs.) Nil Nil 1,73,17,134

8. Loan repaid by the Trust during the year from exercise price received

NA NA NA

9. Number of options outstanding at the end of the year (out of total number of options approved under ESOS)

Nil 5,90,988 9,59,050

10. Number of options exercisable at the end of the year (out of total number of options approved under ESOS)

Nil

3,93,905

2,01,087

11. Weighted-average exercise

Stock Options granted on

Weighted average exercise price (in Rs.)

Weighted average Fair value (in Rs.)

06.02.2014 45.60 69.50

06.08.2014 85.42 113.79

26.04.2016 87.13 116.18

04.11.2016 103.40 137.94

12. Employee wise details of options granted to

a. Key managerial personnel Nil Nil Nil

b. Any other employee who receive a grant of options in any one year of option amounting to 5% or more of option granted during the year

Nil Nil Nil

c. Identified employees who were granted option, during any one year, equal to or exceeding 1% of the issued capital (excluding outstanding warrants & conversions) of the Company at the time of grant

Nil Nil Nil

13 Description of the method and significant assumptions used during the year to estimate the fair value of the options, including the following weighted average information

The Black Scholes option-pricing model was developed for estimating fair value of traded options that have no vesting restrictions and are fully transferable. Since option-pricing models require use of substantive assumptions, changes therein can materially affect fair value of options. The option pricing models do not necessarily provide a reliable measure of fair value of options.

14 The main assumptions used in the Black Scholes option-pricing model during the year were as follows: (i) Weighted average values of share price (ii) exercise price (iii) Risk free interest rate (iv) Expected Life of Options (v) Expected volatility (vi) Dividend yield

Refer point no. 11 Refer point no.11 8.00% 3 years 26.04.2016 (-6.92%), 04.11.2016 (0.72%) 0.81%

15 The method used and the assumptions made to incorporate the effects of expected early exercise

NA

16 How expected volatility was determined, including an explanation of the extent to which expected volatility was based on historical volatility

We have considered the historical price of the company at the stock exchange, where the trading volume is high. The average closing price on weekly basis was taken to calculate the volatility of the shares.

17 Whether and how any other features of the option grant were incorporated into the measurement of fair value, such as a market condition.

No

Singlii ~ Co.Chartered Accountants161, SARAT BOSE ROAD, KOLKATA-700 026, (INDIA)({) : +91(0)33-24196000/01/02· E-mail: kolkata@singhico.com • Website: www.singhico.com

•.Certificate

[Pursuant to Section Regulation 13 of Securities and Exchange Board of India

(Share Based Employee Benefits) Regulations, 2014]

1. At the request of 'Gati Limited' ('Company'), we, the statutory auditors of the Company, have examined therelevant records of the company, we certify that Employee Stock Option Schemes of the company are inaccordance with the Securities and Exchange Board of India (Employee Stock Option Scheme and EmployeeStock Purchase Scheme) Guidelines, 1999 and SEBI (Share Based Employee Benefits) Regulations, 2014 (asamended). This certificate is required by the Company in connection with the Regulation 13 of Securities andExchange Board of India (Share Based Employee Benefits) Regulations, 2014.

2. For the purpose of this certificate we have relied upon the resolutions passed in the Annual General Meeting ofthe shareholders of the company, In-principle approval received from National Stock Exchange of India Limited &Bombay Stock Exchange Limited, policies & procedure framed by Nomination & Remuneration Committee toensure that there is no violation of securities laws and other requirements as per the Securities and ExchangeBoard of India (Share Based Employee Benefits) Regulations, 2014 & Securities and Exchange Board of India(Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999.

3. The responsibility for compliance with relevant laws and regulation is that of the Board of directors of thecompany. Our responsibility is only to examine and report the above stated requirements as per the procedurementioned in paragraph 2 above and report our findings. We performed the above- mentioned procedures inaccordance with the requirements of the Guidance Note on Audit Reports and Certificates Issued for SpecialPurposes issued by the Institute of Chartered Accountants of India. In addition to the foregoing, our scope ofwork did not include verification of compliance with other requirements of the Guidelines, other circulars,notifications, etc., as issued by MCA, SEBIor regulatory authorities from time to time, and any other laws andregulations applicable to the Company. Further, our scope of work did not involve performing audit tests for thepurpose of expressing an opinion on the fairness or accuracy of any of the financial information or the financialstatements of the Company taken as a whole. We have not performed an audit, the objective of which would bethe expression of an opinion on the financial statements, specified elements, accounts or items thereof, for thepurpose of this certificate. Accordingly, we do not express such an opinion.

4. Our certificate is solely for the purpose set forth in paragraph 1 above and for your information and is not to beused for any other purpose or to be distributed to any other parties. .

•" S. We have no responsibility to update this certificate for events and circumstances occurring after the date of this

certificate.

-inghi)

PartnerMembership No. 066274

Place: Kolkata

Date: zs" May, 2018

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MUMBAI NEW D~LHI BANGALORE CHENNAI • AHMEDABAD