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Directors Report of Asian Hotels (East) Ltd.

Mar 31, 2014

The Directors are pleased to present their 7th Annual Report on the business and operation of the Company together with the audited annual accounts of the Company for the year ended 31st March 2014.

FINANCIAL HIGHLIGHTS

Your Company''s performance during the year under review is summarised as under:

Particulars Standalone Consolidated (Rs. in lacs) (Rs. in lacs) 2013-14 2012-13 2013-14 2012-13

Revenue from operation 9270.18 9024.13 17965.63 15111.17

Profit before Depreciation and Tax Expenses 3858.01 4536.39 697.78 2663.53

Less: Depreciation 533.71 654.31 2481.05 1868.47

Profit Before Tax 3324.30 3882.08 (1783.27) 795.06

Less: Current tax 606.39 563.84 606.39 563.84

Deferred tax 19.74 99.51 19.74 99.51

Others (37.98) 45.52 (35.88) 45.92

Profit after tax before adjustment of minority interest 2736.15 3173.21 (2373.52) 85.79

Add: Share of loss transferred to minority interest - - 1625.87 983.82

Profit for the year 2736.15 3173.21 (747.65) 1069.61

Add: Balance in statement of profit & loss 16455.81 14198.26 14545.39 14391.44

Less: Transferred to General Reserve 273.61 317.32 273.61 317.32

Proposed Dividend on Equity Shares 343.26 514.82 343.26 514.82

(including earlier years adjustment)

Tax on Dividend (including earlier years adjustment) 62.31 83.52 62.31 83.52

Closing Balance 18512.78 16455.81 13118.56 14545.39

STAND-ALONE PERFORMANCE

- Operating revenue during the financial year 2013-14 increased to Rs. 9270.18 lacs as against Rs. 9024.13 lacs during the financial year 2012-13.

- Profit Before Tax during the financial year 2013-14 is Rs. 3324.30 lacs as against Rs. 3882.08 lacs during the financial year 2012-13.

- Profit for the year is Rs. 2736.15 lacs during the financial year 2013-14 as compared to Rs. 3173.21 lacs during the financial year 2012-13.

CONSOLIDATED PERFORMANCE

- Consolidated operating revenue during the financial year 2013-14 increased to Rs. 17965.63 lacs as against Rs. 15111.17 lacs during the financial year 2012-13.

- Profit Before Tax during the financial year 2013-14 is Rs. (1783.27) lacs as against Rs. 795.06 lacs during the financial year 2012-13.

- Profit for the year is Rs. (747.65) lacs during the financial year 2013-14 as compared to Rs. 1069.61 lacs during the financial year 2012-13.

APPROPRIATIONS

During the financial year 2013-14, an amount of Rs. 273.61 lacs (Rs. 317.32 lacs last year) has been appropriated to General Reserve.

DIVIDEND

The Board of Directors are pleased to recommend a dividend @ 30%, i.e. Rs. 3/- per equity share (previous year Rs. 4.50/- per equity share) on 1,14,40,585 equity shares of Rs. 10/- each for the year ended 31st March 2014. The total cost to the Company on account of dividend payment will be Rs. 401.55 lacs including dividend distribution tax of Rs. 58.33 lacs.

BUSINESS OVERVIEW

The Board is pleased to inform that during the financial year 2013-14 the overall revenue of the hotels was positive and with effective cost control & working capital management, the Company enhanced its operating performance which has already been highlighted above and in the Management Discussion & Analysis Report.

During the financial year, the hotel hosted major events that happened in the city of Kolkata including the IPL Opening Ceremony 2013, an extensive amount of wedding events, EO Annual Meeting in January 2014 and various medical conferences.

Hyatt Regency Kolkata achieved a Net Promoter Score (NPS) of 50.3 Percentage in our customer satisfaction survey - Medallia. The survey is based on the question of "Likelihood to Recommend the hotel" and hotel has been given a rating of over 5 in a scale of 10 maximum.

Your Board is constantly on the lookout for offering the highest consistency in quality, service and setting new standards to make the guests fully satisfied and the visit a rewarding experience. Adequate internal controls have been laid down by the Company to safeguard and protect its assets as well as to improve the overall productivity of its operations. An external audit has successfully been conducted to monitor hygiene standards, safety and security as well as audits to improve the energy and other efficiencies in the hotel.

COMPLIANCE WITH NOTIFICATION NO.S.O.301(E) DATED 8TH FEBRUARY 2011 ISSUED BY THE MINISTRY OF CORPORATE AFFAIRS UNDER SECTION 211(3) OF THE COMPANIES ACT, 1956

Since Central Government had issued a Notification No. S.O. 301 (E) dated 8th February, 2011 in exercise of the powers conferred by Section 211(3) of the Companies Act, 1956 granting general exemption to some specified class of companies, including hotel companies, from disclosing certain information in their Statement of Profit and Loss as required under Part-II of Schedule VI of the Companies Act, 1956 subject to fulfillment of few conditions, your Company has duly complied with all conditions of the notification to seek general exemption under Section 211(4) of the Companies Act, 1956, paras 3(i)(a) and 3(ii)(d) of Part II of Schedule VI of the Companies Act, 1956 dealing with the disclosure of quantitative details of turnover of each class of goods, opening and closing stock, purchases, production and consumption of raw material in the financial statements for the financial year ended 31st March 2014. Your Board has passed necessary resolution to comply with the notification.

SUBSIDIARY COMPANIES

The Company has two subsidiaries, namely GJS Hotels Limited, a wholly owned and a material non-listed Indian Subsidiary and Regency Convention Centre and Hotels Limited and one step down subsidiary namely Robust Hotels Private Limited.

The Ministry of Corporate Affairs, New Delhi has issued a General Circular No: 2 /2011 dated 8th February 2011 (said Circular) granting general exemption from complying with the provisions of Section 212 of the Companies Act, 1956 and the General Exemption is subject to certain conditions which inter alia requires the Board of Directors of the Company to give consent, by passing a Board Resolution, for not attaching the Balance Sheet of the subsidiary/ies concerned. Accordingly, your Directors have passed necessary Board Resolution to avail the above general exemption. The Consolidated Financial Statements of holding company and all the subsidiaries, prepared in strict compliance with applicable accounting standards and Listing Agreement as prescribed by the Securities and Exchange Board of India (SEBI) and duly audited by Statutory Auditors of the Company have been presented in the Annual Report along with the prescribed Financial Information in respect of the subsidiary companies. The Company will make available the Annual Accounts of the subsidiary companies to the members of the Company as well as members of subsidiary companies who may be interested in obtaining the same at any point of time. The Annual Accounts of the subsidiary companies will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. Hard copy of details of accounts of subsidiaries shall be made available to the members on demand.

AMALGAMATION

The Scheme of Amalgamation of Forex Finance Private Limited with the Company has been approved by the equity shareholders of the Company with requisite majority as required under Section 391(2) of the Companies Act, 1956 at the Court Convened Meeting of the equity shareholders of the Company held on 8th April 2014. Further the Scheme was put to vote by public shareholders through postal ballot and e-voting process. Resolution for the approval of the Scheme was passed with requisite majority by the public shareholders.

The Company has filed the petitions for sanction of the Scheme as per Section 391(2) and 394 read with Section 100 of the Companies Act, 1956 with the Hon''ble High Court at Calcutta.

AUDITORS & AUDITORS'' REPORT

M/s S.S. Kothari Mehta & Co., Chartered Accountants, Kolkata, the present auditors of the Company, retires at the forthcoming Annual General Meeting and is eligible for re-appointment as auditors and has confirmed their eligibility and willingness to accept office, if re-appointed. Members are requested to re-appoint them and fix their remuneration. The Audit Committee of the Board has recommended their re-appointment.

The notes on accounts referred to in the Auditors'' Report are self-explanatory and, therefore, do not call for any further comments.

During the year under review, Internal Audit of the Company has been carried out by M/s. KSMN & Company, Chartered Accountants, Kolkata.

BOARD OF DIRECTORS

The Company had pursuant to the provisions of Clause 49 of the Listing Agreement entered with the Stock Exchanges, appointed Mr. A. C. Chakrabortti, Mr. Rama Shankar Jhawar and Mr. Padam Kumar Khaitan as Independent Directors of the Company.

As per Section 149(4) of the Companies Act, 2013, which came into effect from 1st April, 2014, every Listed Company is required to have at least one-third of the total number of directors as Independent Directors. In accordance with the provision of Section 149 of the Act, these Directors are being appointed as Independent Directors to hold office as per their tenure of appointment mentioned in the Notice of the forthcoming Annual General Meeting of the Company.

Mr. Radhe Shyam Saraf retires by rotation and being eligible, offers himself for reappointment at the ensuing Annual General Meeting.

During the year Mr. S. S. Bhandari resigned as a Director of the Company due to his health reasons causing casual vacancy on the Board of Directors of the Company. The Board decided not to fill up the causal vacancy caused by his resignation.

DIRECTORS'' RESPONSIBILITY STATEMENT UNDER SECTION 217(2AA) OF THE COMPANIES ACT, 1956

Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors confirm as under:

that in the preparation of annual accounts for the year ended 31st March 2014, the applicable Accounting Standards have been followed along with proper explanation relating to materials departures, if any;

that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and pursuant so as to give a true and fair view of the state of affairs of the Company at the end of the financial year under review and of the profit or loss of the Company for the financial year;

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

that the Directors have prepared the annual accounts on a going concern basis.

PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

During the year, your Company has no activity relating to Conservation of Energy and Technology Absorption as stipulated in the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988. However, your Company uses information technology extensively in its operations and also continues its Endeavour to improve energy conservation and utilization, safety and environment.

The Company''s earnings and outgo in foreign exchange for the financial year under review were Rs. 3355.66 lacs/ Rs. 600.55 lacs respectively.

PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, the names and other particulars of employees are required to be set out in the Director''s Report. However, as per the provisions of Section 219(1)(b)(iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any Member interested in obtaining such particulars may write to the Chief Legal Officer & Company Secretary at the Registered Office of the Company.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT AND CORPORATE GOVERNANCE REPORT

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Report on Management Discussion and Analysis Report as Annexure-A and Corporate Governance Report as Annexure-B and Compliance Certificate on Corporate Governance are annexed to this Report.

CORPORATE SOCIAL RESPONSIBILITY

The Company is associated with charitable and social activities and thereby playing a pro-active role in the socio-economic growth. Hyatt Regency Kolkata encourages local non-profits for various environmental awareness programs. We recognise and embrace the need to serve our community. In addition to several local programs conducted by us, our most important initiative for the financial year has been to create awareness for the East Kolkata Wetlands with schools but also in cooperation with our corporate clients and additionally we are supporting "Ek Tara" an initiative of some private investors for tutoring of girls and young women with the aim of empowerment and making them self-supporting.

The Board of Directors of the Company at its meeting held on 22nd May 2014 has constituted the Corporate Social Responsibility Committee in line with Section 135 of the Companies Act 2013. Detail of the same has been provided in the Corporate Governance Report. The Committee is responsible for formulating and monitoring the Corporate Social Responsibility Policy of the Company.

ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation towards all associates including customers, the Government of India, Government of West Bengal, Government Agencies, Hyatt Hotels Corporation, Bankers, suppliers, shareholders, employees and others who have reposed their confidence in the Company.

For and on behalf of the Board of Directors

Place: Kolkata Umesh Saraf Rama Shankar Jhawar

22nd May 2014 Joint Managing Director Director


Mar 31, 2013

To the Members,

The Directors take pleasure in presenting their 6th Annual Report on the business and operation of the Company together with the audited annual accounts of the Company for the year ended 31st March 2013.

FINANCIAL HIGHLIGHTS

Your Company''s performance during the year under review is summarised as under:

Particulars Standalone Consolidated (Rs. in lacs) (Rs. in lacs)

2012-13 2011-12 2012-13 2011-12

Total Revenue 11398.88 10199.29 17527.57 10199.31

Profit before Depreciation and Tax Expenses 4536.39 4284.92 2663.53 4277.18

Less: Depreciation 654.31 685.04 1868.47 685.04

Profit Before Tax 3882.08 3599.88 795.06 3592.14

Less: Current Tax 563.84 801.68 563.84 801.58

Deferred Tax 99.51 (5.52) 99.51 (5.52)

Others 45.52 45.92

Profit After Tax before adjustment of Minority Interest 3,173.21 2,803.72 85.79 2796.08

Add: Share of loss transferred to Minority Interest 983.82

Profit for the year 3173.21 2803.72 1069.61 2796.08

Add: Balance in Statement of Profit & Loss 14198.26 12273.25 14391.44 12474.08

Less: Transferred to General Reserve 317.32 280.37 317.32 280.37

Proposed Dividend on Equity Shares 514.82 514.82 514.82 514.83

Tax on Dividend 83.52 83.52 83.52 83.52

Closing Balance 16455.81 14198.26 14545.39 14391.44

STAND-ALONE PERFORMANCE

- Total Revenue during the financial year 2012-13 increased to Rs. 11398.88 lacs as against Rs. 10199.29 lacs during the financial year 2011-12.

- Profit Before Tax during the financial year 2012-13 increased to Rs. 3882.08 lacs as against Rs. 3599.88 lacs during the financial year 2011-12.

- Profit for the year is Rs. 3173.21 lacs during the financial year 2012-13 as compared to Rs. 2803.72 lacs during the financial year 2011-12. CONSOLIDATED PERFORMANCE

- Consolidated Total Revenue during the financial year 2012-13 increased to Rs. 17527.57 lacs as against Rs. 10199.31 lacs during the financial year 2011-12.

- Profit Before Tax during the financial year 2012-13 is Rs. 795.05 lacs as against Rs. 3592.14 lacs during the financial year 2011-12.

- Profit for the year is Rs. 1069.61 lacs during the financial year 2012-13 as compared to Rs. 2796.08 lacs during the financial year 2011-12. APPROPRIATIONS

During the financial year 2012-13 an amount of Rs. 317.32 lacs has been appropriated to General Reserve (Rs. 280.37 lacs last year).

DIVIDEND

The Board of Directors are pleased to recommend a dividend @ 45%, i.e. Rs.4.50/- per equity share (previous year Rs. 4.50/- per equity share) on 1,14,40,585 equity shares of Rs. 10/- each for the year ended 31st March 2013. The total cost to the Company on account of dividend payment will be Rs. 598.34 lacs including dividend distribution tax of Rs. 83.52 lacs.

BUSINESS OVERVIEW

The Board is pleased to inform that during the financial year 2012-13 the overall hotel''s revenue was positive and with effective cost control & effective working capital management, the Company maintained its performance which has already been highlighted above and in the Management Discussion and Analysis Report.

During the financial year, the hotel were hosts for major events that happened in the city including the IMME 2012, YPO "Roll Cal Roll", Indian Science Congress, Airport authority of India, IPL Opening Ceremony and Medical Conferences. We had the honor of having Dr. Manmohan Singh, Hon''ble Prime Minister of India, stay over with us in January 2013 as a part of the Indian Science Congress meet.

Hyatt Regency Kolkata achieved a Net Promoter Score (NPS) of 56 Percentile in our customer satisfaction survey - Medalia. The survey is based on the question of "Likelihood to Recommend the hotel" and is based on ratings between the scale of 1 to 10, where 10 indicates the maximum positive and rating 1 is for the maximum negative. Ratings by the guests on the Hotel are satisfactory.

Your Board is constantly on the look out for offering the highest consistency in quality, service and setting new standards to make the guests feel at home. Adequate internal controls have been laid down by the Company to safeguard and protect its assets as well as to improve the overall productivity of its operations and even steps were taken by your Board during the financial year 2012-13 to conduct a complete Insurance Audit in order to evaluate the risk involved and the right mix of insurance coverage to be taken for ensuring safety, security and quality.

COMPLIANCE WITH NOTIFICATION NO.S.O.301(E) DATED 8TH FEBRUARY 2011 ISSUED BY THE MINISTRY OF CORPORATE AFFAIRS UNDER SECTION 211(3) OF THE COMPANIES ACT, 1956

Since Central Government had issued a Notification No. S.O. 301 (E) dated 8th February, 2011 in exercise of the powers conferred by Section 211(3) of the Companies Act, 1956 granting general exemption to some specified class of companies, including hotel companies, from disclosing certain information in their Statement of Profit and Loss as required under Part-II of Schedule VI of the Companies Act, 1956 subject to fulfillment of few conditions, your Company has duly complied with all conditions of the notification to seek general exemption under Section 211(4) of the Companies Act, 1956, paras 3(i)(a) and 3(ii)(d) of Part II of Schedule VI of the Companies Act, 1956 dealing with the disclosure of quantitative details of turnover of each class of goods, opening and closing stock, purchases, production and consumption of raw material in the financial statements for the financial year ended 31st March 2013. Your Board has passed necessary resolution to comply with one of the conditions of the notification for the same.

SUBSIDIARY COMPANIES

The Company has two subsidiaries, namely GJS Hotels Limited, a wholly owned and a material non-listed Indian Subsidiary and Regency Convention Centre and Hotels Limited and one step down subsidiary namely Robust Hotels Private Limited.

During the year, GJS Hotels Limited, wholly owned subsidiary of the Company, has exercised the option to convert Cumulative Redeemable and Optionally Convertible Preference Shares of Robust Hotels Private Limited. Consequently, the Board of Directors of Robust Hotels Private Limited at their meeting held on 26th July 2012 issued and allotted 6,39,32,769 equity shares of Rs.10/- each at a conversion price of Rs. 32/- per Equity Shares to GJS Hotels Limited. Subsequent to this allotment, GJS Hotels Limited became holding company of the Robust Hotels Private Limited and consequently Robust Hotels Private Limited became step down subsidiary of your Company. Robust Hotels Private Limited is the owner of Hyatt Regency Chennai, a 5 Star premium business hotel located in Chennai and during the year under review, the Company provided a corporate guarantee to IDBI bank, Mumbai to secure credit facilities of Rs.240 crores availed by Robust Hotels Private Limited, Chennai.

The Ministry of Corporate Affairs, New Delhi has issued a General Circular No: 2 /2011 dated 8th February 2011 (said Circular) granting general exemption from complying with the provisions of Section 212 and the General Exemption is subject to certain conditions which inter alia requires the Board of Directors of the Company to give consent, by passing a Board Resolution, for not attaching the Balance Sheet of the subsidiary/ies concerned. Accordingly, your Directors have passed necessary Board Resolution to avail the above general exemption. The Consolidated Financial Statements of holding company and all the subsidiaries, prepared in strict compliance with applicable accounting standards and Listing Agreement as prescribed by the Securities and Exchange Board of India (SEBI) and duly audited by Statutory Auditors of the Company have been presented in the Annual Report along with the prescribed Financial Information in respect of the subsidiary companies. The Company will make available the Annual Accounts of the subsidiary companies and the related detailed information to the Members of the Company as well as Members of subsidiary companies who may be interested in obtaining the same at any point of time. The Annual Accounts of the subsidiary companies will also be kept open for inspection at the Registered Office of the Company as well as that of the respective subsidiary companies. Hard copy of details of accounts of subsidiaries shall be made available to the Members on demand.

AMALGAMATION

The Board of Director of the Company at its meeting held on 23rd May 2013, in consideration of SEBI Circular Nos. CIR/CFD/DIL/5/2013 and CIR/CFD/DIL/8/2013 dated 4th February 2013 and 21st May 2013 respectively, approved the amalgamation of Forex Finance Private Limited, a Promoter Body Corporate with the Company with effect from 1st April 2012 subject to approval of shareholder and other appropriate regulatory authorities. The scheme has been considered to be in the interest of the shareholders of both the companies.

It was felt that the proposed amalgamation will result in the formation of a larger and stronger Company having a core operating business with the backing and leverage of a sound financial asset base which is conveniently held and monitored as an incidental part of the entire undertaking and activities of the amalgamated entity without detracting from the operating business or diluting focus thereon.

Further, your Board thinks that the amalgamation will enable appropriate consolidation of the activities of both the companies, with pooling and more efficient utilization of resources, greater economies of scale, reduction in overheads and expenses and improvement in various operating parameters.

Post amalgamation, Robust Hotels Private Limited, owner of Hyatt Regency Chennai, will be a wholly owned subsidiary of the Company; partially by having direct holding and balance through GJS Hotels Limited (wholly owned subsidiary of the Company) and there will be two branded operating 5 star deluxe hotels namely Hyatt Regency Kolkata and Hyatt Regency Chennai under the control of your Company. It will bring more room inventory under the control of the Company and thus help its valuation in case of any future issue of shares. The Company is in the process of obtaining regulatory approvals for the amalgamation.

AUDITORS & AUDITORS'' REPORT

M/s S.S. Kothari Mehta & Co., Chartered Accountants, Kolkata, the present auditors of the Company, retires at the forthcoming Annual General Meeting and is eligible for re-appointment as auditors. Members are requested to re-appoint them and fix their remuneration. The Company has received confirmation from the firm to the effect that their reappointment, if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956 and they are not disqualified for reappointment within the meaning of Section 226 of the said Act. The Audit Committee of the Board has recommended their re-appointment.

The notes on accounts referred to in the Auditors'' Report are self-explanatory and, therefore, do not call for any further comments.

During the year under review, Internal Audit of the Company has been carried out by M/s. KSMN & Company, Chartered Accountants, Kolkata. Their findings have been satisfactory.

Further, Secretarial Audit has been carried by a firm of Company Secretaries. The Secretarial Audit Report confirms that the Company has complied with all the applicable provisions of the Companies Act, 1956, Depositories Act, 1996, Listing Agreements with the Stock Exchanges, Securities Contracts (Regulation) Act, 1956 and all the Regulations and Guidelines of SEBI as applicable to the Company, including the SEBI (Substantial Acquisitions of Shares and Takeovers) Regulations, 2011 and the SEBI (Prohibitions of Insider Trading) Regulations, 1992.

BOARD OF DIRECTORS

Mr. R.S.Jhawar retires by rotation and being eligible, offers himself for reappointment at the ensuing Annual General Meeting.

Post 31st March 2013, Mr. S.S. Bhandari, the Independent Director of the Company has resigned from the Directorship of the Company w.e.f 11th April 2013. The Board expresses its appreciation for the valuable services rendered and matured advice by Mr. S.S. Bhandari during his association with the Company.

Post 31st March 2013, Mr. Ramesh Kumar Chokhani and Mr. A.C. Chakrabortti have been appointed as Additional Directors of the Company w.e.f 22nd May 2013 and 23rd May 2013 respectively. Mr. Ramesh Kumar Chokhani and Mr. A.C. Chakrabortti hold office up to the ensuing Annual General Meeting of the Company. Notices pursuant to Section 257 of the Act have been received from some members proposing Mr. Ramesh Kumar Chokhani and Mr. A.C. Chakrabortti for appointment as Directors of the Company.

Profile of the Directors seeking appointment/re-appointment as required to be given in terms of Clause 49(IV)(G) of the Listing Agreement forms part of the notice convening the ensuing Annual General Meeting of the Company.

DIRECTORS'' RESPONSIBILITY STATEMENT UNDER SECTION 217(2AA) OF THE COMPANIES ACT, 1956

Pursuant to Section 217(2AA) of the Companies Act, 1956 your Directors confirm as under:

– that in the preparation of annual accounts for the year ended 31st March 2013, the applicable Accounting Standards have been followed along with proper explanation relating to materials departures, if any;

– that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and pursuant so as to give a true and fair view of the state of affairs of the Company at the end of the financial year under review and of the profit of the Company for the financial year;

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

– that the Directors have prepared the annual accounts on a going concern basis.

PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information required pursuant to Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, pertaining to conservation of energy, technology absorption, and foreign exchange earnings and outgo, to the extent possible in the opinion of your Directors, is annexed hereto being Annexure-A and forming part of this Report.

The Company''s earnings and outgo in foreign exchange for the financial year under review were Rs. 3485.34 lacs/ Rs. 884.98 lacs respectively.

PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, the names and other particulars of employees are required to be set out in the Director''s Report. However, as per the provisions of Section 219(1)(b)(iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any Member interested in obtaining such particulars may write to the Chief Legal Officer & Company Secretary at the Registered Office of the Company.

MANAGEMENT DISCUSSION AND ANALYSIS AND CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Report on Management Discussion and Analysis Report as Annexure-B and Corporate Governance as Annexure-C and Compliance Certificate on Corporate Governance are annexed to this Report.

CORPORATE SOCIAL RESPONSIBILITY

The Company is associated with charitable and social activities and thereby playing a pro-active role in the socio-economic growth. Hyatt Regency Kolkata encourages local non-profits for various environmental awareness programs. With few NGOs of the city, Hyatt Regency Kolkata during the financial year had participated in activities in the localities and maintained its Corporate Social Responsibility (CSR) vision. Hyatt in partnership with NEWS in the financial year 2012-13, developed a community participative model for scientific management of municipal solid wastes in East Kolkata Wetlands. There is a dedicated ''Green Team'' which runs these regular events and interacts with the local people in the adjoining areas for development and awareness. Also the hotel initiated internal activities to keep its employees & guests engaged with the CSR vision-Earth Hour, Green board, Best of waste activity & Earth Day.

ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation towards all associates including customers, the Government of India, Government of West Bengal, Government Agencies, Hyatt International Corporation, U.S.A., Bankers, Suppliers, Shareholders, Employees and others who have reposed their confidence in the Company.

For and on behalf of the Board of Directors

Place: Kolkata Umesh Saraf R. S. Jhawar

23rd May 2013 Joint Managing Director Director


Mar 31, 2012

The Directors take pleasure in presenting their 5th Annual Report on the business and operation of the Company together with the audited annual accounts of the Company for the year ended 31 st March 2012.

FINANCIAL HIGHLIGHTS

Your Company's performance during the year under review is summarized as under:

Particulars Standalone Consolidated (Rs. in lacs) (Rs. in lacs)

2011-12 2010-11 2011-12 2010-11

Total Revenue 10097.65 10095.17 10097.66 10198.16

Profit before Depreciation and Tax Expenses 4284.92 4300.53 4277.18 4398.73

Less: Depreciation 685.03 679.51 685.03 679.52

Profit Before Tax 3599.89 3621.01 3592.14 3719.21

Less: Current Tax 801.68 623.00 801.58 625.50

Deferred Tax (5.52) (18.67) (5.52) (18.67)

Profit for the year 2803.72 3016.68 2796.08 3112.38

Add: Balance in Statement of Profit & Loss 12273.25 10154.61 12474.07 10259.74

Less: Transferred to General Reserve 280.37 301.67 280.37 301.67

Proposed Dividend on Equity/ Preference* Shares 514.82 513.13* 514.82 513.13*

Tax on Dividend 83.52 83.24 83.52 83.24

Closing Balance 14198.26 12273.25 14391.44 12474.07

*Proposed Dividend includes dividend proposed on both equity and preference shares of the Company.

STAND-ALONE PERFORMANCE

- Total Revenue during the financial year 2011-12 increased to Rs. 10097.65 lacs as against Rs. 10095.17 lacs during the financial year 2010-11.

- Profit Before Tax during the financial year 2011-12 is Rs. 3599.89 lacs as against Rs. 3621.01 lacs during the financial year 2010-11.

- Profit for the year is Rs. 2803.72 lacs during the financial year 2011 -12 as compared to Rs. 3016.68 lacs during the financial year 2010-11. CONSOLIDATED PERFORMANCE

- Consolidated Total Revenue during the financial year 2011-12 is Rs. 10097.66 lacs as against Rs. 10198.16 lacs during the financial year 2010-11.

- Profit Before Tax during the financial year 2011-12 is Rs. 3592.14 lacs as against Rs. 3719.21 lacs during the financial year 2010-11.

- Profit for the year is Rs. 2796.08 lacs during the financial year 2011 -12 as compared to Rs. 3112.38 lacs during the financial year 2010-11. APPROPRIATIONS

During the year 2011-12 an amount of Rs. 280.37 lacs has been appropriated to General Reserve (Rs.301.67 lacs last year).

DIVIDEND

The Board of Directors are pleased to recommend a dividend @ 45%, i.e. Rs. 4.50/- per equity share (previous year Rs. 4.50/- per equity share) on 1,14,40,585 equity shares of Rs. 10/ - each for the year ended 31st March 2012. The total cost to the Company on account of dividend payment will be Rs. 598.34 lacs including dividend distribution tax of Rs. 83.52 lacs.

ISSUE AND ALLOTMENT OF EQUITY SHARES PURSUANT TO CONVERSION OF 27,780 1% FULLY CONVERTIBLE PREFERENCE SHARES (FCPS) OF THE COMPANY AND ITS CONSEQUENT LISTING AND TRADING

During the financial year 2011-12 the Company had issued and allotted 38,803 equity shares of Rs. 10/- each to the preference shareholders pursuant to conversion of their 27,780 1% Fully Convertible Preference Shares (FCPS) in terms of Clause 5.3.1 of the sanctioned Scheme of Arrangement and Demerger and directions of the stock exchanges under Chapter VII of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 and these shares were subsequently listed and traded taking the issued, subscribed and paid-up equity capital of the Company to Rs. 11,44,05,850/- consisting of 1,14,40,585 equity shares of Rs. 10/- each fully paid up duly listed on the stock exchanges. As on the date of the Report, the Company has no outstanding preference share capital.

BUSINESS OVERVIEW

Your Board is pleased to inform you that during the financial year 2011-12 with a focus on marketing efforts, cost control and effective working capital management, the Company maintained its performance which has already been highlighted above and in the Management Discussion and Analysis.

Hyatt Regency Kolkata (HRK) follows an On-line Customer Satisfaction Survey called Hyatt Sat, based on the ratings between the scale of 1 to 10, where 10 indicates the maximum positive and rating 1 is for the maximum negative. Ratings by the guests on the Hotel are satisfactory. Your Board is constantly on the lookout for offering the highest consistency in quality, service and setting new standards to make the guests feel at home. Adequate internal controls have been laid down by the Company to safeguard and protect its assets as well as to improve the overall productivity of its operations and even steps were taken by your Board during the financial year 2011-12 to conduct a complete Insurance Audit in order to evaluate the risk involved and the right mix of insurance coverage to be taken for ensuring safety, security and quality.

COMPLIANCE WITH NOTIFICATION NO. S.O. 301(E) DATED 8TH FEBRUARY 2011 ISSUED BY THE MINISTRY OF CORPORATE AFFAIRS UNDER SECTION 211 (3) OF THE COMPANIES ACT, 1956

Since Central Government had issued a Notification No. S.O. 301 (E) dated 8th February 2011 in exercise of the powers conferred by Section 211(3) of the Companies Act, 1956 granting general exemption to some specified class of companies, including hotel companies, from disclosing certain information in their Statement of Profit and Loss as required under Part-II of Schedule VI of the Companies Act, 1956 subject to fulfillment of few conditions, your Company has duly complied with all conditions of the notification to seek general exemption under Section 211(4) of the Companies Act, 1956, pares 3(i)(a) and 3(ii)(d) of Part II of Schedule VI of the Companies Act, 1956 dealing with the disclosure of quantitative details of turnover of each class of goods, opening and closing stock, purchases, production and consumption of raw material in the financial statements for the financial year ended 31st March 2012. Your Board has passed necessary resolution to comply with one of the conditions of the notification for the same.

SUBSIDIARY COMPANIES

GJS Hotels Limited and Regency Convention Centre and Hotels Limited continue to be wholly owned subsidiary and subsidiary of your Company.

As required under Section 212 of the Companies Act, 1956, the Audited Statements of Accounts, along with the Report of the Board of Directors relating to the Company's subsidiaries together with respective Auditors' Reports thereon for the year ended 31 st March 2012 are annexed.

OPENING OF HYATT REGENCY CHENNAI

Your Company, together with its wholly-owned subsidiary GJS Hotels Limited, holds investment of around Rs. 266 Crores in preference share capital of Robust Hotels Private Limited which owns Hyatt Regency Chennai, a 5 Star premium business hotel located in Chennai's central business district and which was opened on 8th August 2011. The 327-room Hyatt Regency Chennai, with a project cost of around Rs. 656 Crores, opens with more than 20,000 sq ft (1,900 sq m) of versatile convention and event space, a fully-equipped fitness centre, some great restaurants and a sun-filled atrium lobby with soothing water features and green landscaping. The Hotel has been received well by the guests.

AUDITORS & AUDITORS' REPORT

M/s S. S. Kothari Mehta & Co., Chartered Accountants, Kolkata, the present auditors of the Company, retires at the forthcoming Annual General Meeting and is eligible for re-appointment as auditors. Members are requested to re-appoint them and fix their remuneration. The Company has received confirmation from the firm to the effect that their reappointment, if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956 and they are not disqualified for reappointment within the meaning of Section 226 of the said Act. The Audit Committee of the Board has recommended their re-appointment.

Directors' clarification/explanations/comments under Section 217(3) of the Companies Act, 1956 for observation and comments referred in the Clause 4(V) of the Auditors' Report including Auditors' Report on Consolidated Financial Statements read with Note 33 and 27to the Notes forming part of Accounts and Consolidated Financial Statements respectively are as under:

Observation of the Auditors:

No provision for impairment has been made in respect of the investment made by the Company in its subsidiary namely Regency Convention Centre and Hotels Limited.

Our Explanation:

Regency Convention Centre and Hotels Limited (RCC) is in possession of two opinions given by the highest legal authorities which, inter-alia, states that RCC has fair chance of winning the legal disputes with the Airport Authority of India (AAI). In view of this, your Board is hopeful about the outcome of the Suit, pending before the Hon'ble High Court of Bombay, involving RCC as plaintiff and accordingly your Company has not made any provision for impairment in the value of investment made in RCC. Lately, AAI has made an effort to resolve the issue amicably by offering an alternate pocket of land in lieu of the suit land. Your subsidiary has accepted the proposal subject to the alternate land is free, clear and unencumbered.

During the year under review, Internal Audit of the Company has been carried out by M/s. KSMN & Company, Chartered Accountants, Kolkata. Their findings have been satisfactory.

Further, Secretarial Audit has been carried by a firm of Company Secretaries. The Secretarial Audit Report confirms that the Company has complied with all the applicable provisions of the Companies Act, 1956, Depositories Act, 1996, Listing Agreements with the Stock Exchanges, Securities Contracts (Regulation) Act, 1956 and all the Regulations and Guidelines of SEBI as applicable to the Company, including the SEBI (Substantial Acquisitions of Shares and Takeovers) Regulations, 2011 and the SEBI (Prohibitions of Insider Trading) Regulations, 1992.

BOARD OF DIRECTORS

Mr. Padam K Khaitan retires by rotation and being eligible, offers himself for reappointment at the ensuing Annual General Meeting.

The Board of Directors appointed Mr. Anil Goenka, a Chartered Accountant as an alternate to Mr. R. S. Jhawar on 10th November 2011, who vacated office on 17th November 2011. The Board placed on record its appreciation for the services rendered by the outgoing Director during his tenure.

DIRECTORS' RESPONSIBILITY STATEMENT UNDER SECTION 217(2AA) OF THE COMPANIES ACT, 1956

Pursuant to Section 217(2AA) of the Companies Act, 1956 your Directors confirm as under:

- that in the preparation of annual accounts for the year ended 31 st March 2012, the applicable Accounting Standards have been followed along with proper explanation relating to materials departures, if any;

- that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and pursuant so as to give a true and fair view of the state of affairs of the Company at the end of the financial year under review and of the profit of the Company for the financial year;

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

- that the Directors have prepared the annual accounts on a going concern basis.

PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information required pursuant to Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules ,1988, pertaining to conservation of energy, technology absorption, and foreign exchange earnings and outgo, to the extent possible in the opinion of your Directors, is annexed hereto being Annexure-A and forming part of this Report.

The Company's earnings and outgo in foreign exchange for the year under review were Rs. 3349.22 lacs /Rs. 671.75 lacs respectively.

PARTICULARS OF EMPLOYEES

As required under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, particulars of the employees concerned are given in the Annexure-B which is attached hereto and forms part of the Directors' Report.

MANAGEMENT DISCUSSION AND ANALYSIS AND CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Report on Management Discussion and Analysis Report as Annexure-C and Corporate Governance as Annexure-D and Compliance Certificate on Corporate Governance are annexed to this Report.

CORPORATE SOCIAL RESPONSIBILITY

The Company is associated with charitable and social activities and thereby playing a pro-active role in the socio-economic growth. During the financial year 2011-12, your Company celebrated Earth Hour, Green Board, Best out of Waste Activity and Earth Day.

ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation towards all associates including customers, the Government of India, Government of West Bengal, Government Agencies, Hyatt International Corporation, U.S.A., Bankers, Suppliers, Shareholders, Employees and others who have reposed their confidence in the Company.

For and on behalf of the Board of Directors

Place: Kolkata Radhe Shyam Saraf

Date: 11th May 2012 Chairman


Mar 31, 2011

To the Members,

The Directors take pleasure in presenting their 4th Annual Report on the business and operation of the Company together with the audited annual accounts of the Company for the year ended 31st March, 2011.

FINANCIAL HIGHLIGHTS

Your Company's performance during the year under review is summarised as under:

Particulars Standalone Consolidated

(Rs. in lacs) (Rs. in lacs)

2011 2011

Sales Turnover (including other Income) 10,095.17 10,198.16

Profit Before Interest & Depreciation etc. 4,300.53 4,398.73

Interest NIL NIL

Depreciation 679.52 679.52

Profit before Tax 3,621.02 3,719.21

Provision for Taxation (Net) 604.33 606.83

Profit after Tax 3,016.68 3,112.38

Surplus Brought Forward from previous year 10,154.62 10,259.74

Profit Available for Appropriation 13,171.30 13,372.12

Transfer to general Reserve 301.67 301.67

Dividend on preference shares 0.05 0.05

Dividend proposed/ paid-up-on equity shares 513.08 513.08

Corporate Dividend Tax 83.24 83.24

Surplus Carried Forward 12,273.25 12,474.08

Earnings per share (Rupees) - Basic 26.46 27.30

Earnings per share (Rupees) - Diluted 26.37 27.20

STAND-ALONE PERFORMANCE

Your Company has earned total revenue of Rs.10095.17 lacs and earned a net profit of Rs.3621.02 lacs. Earnings before interest, tax, depreciation and amortisation (EBITDA) is Rs.4300.53 lacs. Profit after tax is Rs.3016.68 lacs.

CONSOLIDATED PERFORMANCE

Your Company has earned total revenue of Rs.10,198.16 lacs on consolidated basis. Earnings before interest, tax, depreciation and amortisation (EBITDA) is Rs.4398.73 lacs on consolidated basis. Profit after tax on consolidated basis has been registered at Rs.3112.38 lacs.

Financial and operating performance of the Company during the financial year 2010-11 is not comparable as the financial year 2009-10 had operational results of Hotel Hyatt Regency Kolkata for a period of 5 months in view of the effectiveness of the Scheme of Arrangement and Demerger (the Scheme) on 11th February, 2010 retrospectively from 31st October, 2009 being the Appointed Date.

Overall, the Company is on a satisfactory growth path and its efforts to improve efficiency, productivity and profitability will improve returns.

APPROPRIATIONS

During the year 2010-11 an amount of Rs.301.67 lacs has been appropriated to General Reserve (Rs.142.84 lacs last year).

DIVIDEND

Your Directors have recommended 1% dividend on 27,780 Fully Convertible Preference Share of Rs. 10/- each for the year 2010-11.

Further, your Board of Directors has recommended a dividend @ 45%, i.e. Rs.4.50 per equity share (previous year Rs. 3.00 per equity shares) on 1,14,01,782 equity shares of Rs. 10/- each for the year ended 31st March, 2011.

The total Dividend outgo for the year ended 31st March, 2011 would be Rs.5.96 crores including the Corporate Dividend Ta x of Rs.83.24 lacs.

Your Directors believe that this will increase shareholder value.

SHIFTING OF REGISTERED OFFICE OF THE COMPANY

During the financial year under review, the Registered Office of the Company was shifted from NCT of Delhi to the State of West Bengal.

LISTING AND TRADING OF EQUITY SHARES OF THE COMPANY ON THE STOCK EXCHANGES

During the year, the equity shares of the Company were listed and admitted for trading on Bombay Stock Exchange Limited and National Stock Exchange of India Limited respectively.

ISSUE AND ALLOTMENT OF EQUITY SHARES OF THE COMPANY

On 30th April, 2011, your Board vide Circular Resolution has issued and allotted 38,910 equity shares of Rs. 10 /- each to the then preference shareholders of the Company consequent to conversion of their 27,780 1 % Fully Convertible Preference Shares (FCPS) in terms of Clause 5.3.1 of the sanctioned Scheme of Arrangement and Demerger read with Chapter VII of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009. The equity shares as aforesaid rank pari passu in all respects with the existing equity shares of the Company including with respect to dividend. Necessary applications have been made to the Bombay Stock Exchange Limited (BSE) and the National Stock Exchange of India Limited (NSE) respectively for obtaining listing and trading permission in respect of the newly allotted equity shares.

As a result of the above issuance and allotments, the number of outstanding shares of the Company as on the date of this Report consists of 1,14,40,692 equity shares of Rs. 10/- each fully paid up.

BUSINESS OVERVIEW

Although the Indian economy is recovering from the impact of the global financial crisis but factors like inflation has slowed the growth further. However, the scenario of the hotel industry in the State of West Bengal, where your Company has the presence has not been encouraging. The tourists continued to stay away from the city of Kolkata due to law and order situation and political instability in the State. Further, the city has failed to produce sufficient business and international events which would otherwise bring the financial fortunes of the hotel. Your Company had to offer best of services at affordable prices.

Having considered the above, your Board is of the view that the Company has maintained its strong presence in the market in the financial year 2010-11. The guest satisfaction scores at the hotel reflect that the quality of the hospitality services continues to be at world class levels. To provide better guest satisfaction and ensure their security, steps were taken to up-grade the televisions sets, gymnasium facilities, kitchen arrangements and install the round the clock monitoring CCTV. Your Directors have a positive view on achieving sustainable and a balance profitable growth in future and have taken a cautious approach on the new properties launched, product up-dation and expansion in domestic market.

COMPLIANCE WITH NOTIFICATION NO. S.O. 301(E) DATED 8th FEBRUARY, 2011 ISSUED BY THE MINISTRY OF

CORPORATE AFFAIRS UNDER SECTION 211(3) OF THE COMPANIES ACT, 1956

Since Central Government had issued a notification No. S.O. 301 (E) dated 8th February, 2011 in exercise of the powers conferred by Section 211(3) of the Companies Act, 1956 granting general exemption to some specified class of companies, including hotel companies, from disclosing certain information in their profit and loss account as required under Part-II of Schedule VI of the Companies Act, 1956 subject to fulfillment of few conditions, your Company has duly complied with all conditions of the notification to seek general exemption under Section 211(4) of the Companies Act, 1956, paras 3(i)(a) and 3(ii)(d) of Part II of Schedule VI of the Companies Act, 1956 dealing with the disclosure of quantitative details of turnover of each class of goods, opening and closing stock, purchases, production and consumption of raw material in the financial statements for the financial year ended 31st March, 2011. Your Board has passed necessary resolution to comply with one of the conditions of the notification for the same.

SUBSIDIARY COMPANIES

Presently, the Company has two subsidiaries namely GJS Hotels Limited and Regency Convention Centre and Hotels Limited.

During the year under review, GJS Hotels Limited has become a material non-listed Indian subsidiary company of your Company in pursuance of Clause 49 (III) of its Listing Agreements with the Stock Exchanges and accordingly the Company has complied with other relevant provisions of the Listing Agreement.

The Registered Offices of the two subsidiaries of your Company, namely GJS Hotels Limited and Regency Convention Centre and Hotels Limited respectively were also shifted from the NCT of Delhi to the State of West Bengal.

As required under the Listing Agreement with the Stock Exchanges and in accordance with the Accounting Standard (AS-21), Consolidated Financial Statement being prepared by the Company includes financial information of its subsidiaries.

In accordance with the provisions laid down in Section 212 of the Companies Act, 1956, the Company is required to attach the Annual Accounts of the subsidiaries to its Annual Accounts and accordingly the Annual Accounts of the subsidiaries together with respective Auditors' Report and Directors' Report thereon form part of this Annual Report.

Considering the convenience and easy reference to Annual Accounts of the Company along with its subsidiaries by the members of the Company, the Company has decided not to avail of the General Circular Nos: 2/2011 and 3/2011 dated 8th February, 2011 and 21st February, 2011 respectively issued by the Ministry of Corporate Affairs, Government of India giving general exemption to the companies under Section 212(8) of the Companies Act, 1956.

AUDITORS & AUDITORS' REPORT

M/s S.S. Kothari Mehta & Co., Chartered Accountants, Kolkata, the present auditors of the Company, retires at the forthcoming Annual General Meeting and is eligible for re-appointment as auditors. Members are requested to re-appoint them and fix their remuneration. The Company has received confirmation from the firm to the effect that their reappointment, if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956 and they are not disqualified for reappointment within the meaning of Section 226 of the said Act. The Audit Committee of the Board has recommended their re-appointment.

Directors clarification/explanations/comments under Section 217(3) of the Companies Act, 1956 for observation and comments referred in the Clause 4(V) of the Auditors' Report including Auditors' Report on Consolidated Financial Statements read with Note 2 in Schedule 16 of the Notes forming the Accounts are as under:

Observation of the Auditors:

No provision for impairment has been made in respect of the investment made by the Company in its subsidiary namely Regency Convention Centre and Hotels Limited.

Our Explanation:

Regency Convention Centre and Hotels Limited (RCC) is in possession of two opinions given by the highest legal authorities which, inter-alia, states that RCC has fair chance of winning the legal disputes with the Airport Authority of India (AAI). In view of this, your Board is hopeful about the outcome of the Suit, pending before the Hon'ble High Court of Bombay, involving RCC as plaintiff and accordingly your Company has not made any provision for impairment in the value of investment made in RCC.

During the year under review, Internal Audit of the Company has been carried out by M/s. KSMN & Company, Chartered Accountants, Kolkata. Their findings have been satisfactory.

Further, Secretarial Audit has been carried by a firm of Company Secretaries. The Secretarial Audit Report confirms that the Company has complied with all the applicable provisions of the Companies Act, 1956, Depositories Act, 1996, Listing Agreements with the Stock Exchanges, Securities Contracts (Regulation) Act, 1956 and all the Regulations and Guidelines of SEBI as applicable to the Company, including the SEBI (Substantial Acquisitions of Shares and Takeovers) Regulations, 1997 and the SEBI (Prohibitions of Insider Trading) Regulations, 1992.

BOARD OF DIRECTORS

In accordance with the provisions of the Companies Act, 1956 and the Company's Articles of Association, Mr. S. S. Bhandari retires by rotation at the ensuing Annual General Meeting of the Company and being eligible, offers himself for re-appointment.

The Director appointed alternate to Mr.R.S. Jhawar on 30th April, 2011, resigned from the Board w.e.f. 2nd May, 2011. The Board placed on record its appreciation for the services rendered by the outgoing Director during his tenure.

DIRECTORS' RESPONSIBILITY STATEMENT UNDER SECTION 217(2AA) OF THE COMPANIES ACT, 1956

Pursuant to Section 217(2AA) of the Companies Act, 1956 your Directors confirm as under:

– that in the preparation of annual accounts for the year ended 31st March, 2011, the applicable Accounting Standards have been followed along with proper explanation relating to materials departures, if any;

– that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and pursuant so as to give a true and fair view of the state of affairs of the Company at the end of the financial year under review and of the profit of the Company for the financial year;

– that the Director have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

– that the Directors have prepared the annual accounts on a going concern basis.

– the significant accounting policies followed by the Company, and the disclosures and details in the Schedules to the Accounts.

PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information required pursuant to Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the report of Board of Directors) Rules ,1988, pertaining to conser vation of energy, technology absorption, and foreign exchange earnings and outgo, to the extent possible in the opinion of your Directors, is annexed hereto being Annexure A and forming part of this Report.

The Company's earnings and outgo in foreign exchange for the year under review were Rs.3097.10 lacs /Rs. 510.52 lacs respectively.

PARTICULARS OF EMPLOYEES

As required under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules 1975 as amended, particulars of the employees concerned are given in the Annexure B which is attached hereto and forms part of the Directors' Report.

CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Report on Corporate Governance and Compliance Certificate on Corporate Governance and Management Discussion and Analysis Report are annexed to this Report.

GROUP FOR INTER-SE TRANSFER OF SHARES

As required under Regulation 3(1)(e)(i) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, persons constituting Group as defined in the Monopolies and Restrictive Trade Practices Act, 1969, for the purpose of availing exemption from applicability of the provisions of Regulations 10 to 12 of the aforesaid SEBI Regulations comprises are Saraf Industries Limited and Forex Finance Private Limited.

CORPORATE SOCIAL RESPONSIBILITY

The Company is associated with various charitable, social, religious and philanthropic activities and thereby playing a pro-active role in the socio- economic growth.

ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation towards all associates including customers, the Government of India, Government of West Bengal, Government Agencies, Hyatt International Corporation, U.S.A., Bankers, Suppliers, Shareholders, Employees and others who have reposed their confidence in the Company.

For and on behalf of the Board

Place: Kolkata UMESH SARAF S S BHANDARI

Date: 28th May, 2011 Joint Managing Director Director


Mar 31, 2010

The Director have pleasure in presenting their 3rd Annual Report on the business and operation of the Company together with the audited accounts of the Company for the period of nine-month ended 31st March, 2010.

EFFECTIVENESS OF THE SCHEME OF ARRANGEMENT AND DE-MERGER

Your Directors are pleased to inform you that during the period under review, the Scheme of Arrangement and De-merger (the Scheme) amongst Asian Hotels Limited (as Transferor Company) and its shareholders and creditors; Chillwinds Hotels Limited (as Transferee Company-I) and its shareholders; and Vardhman Hotels Limited, now known as Asian Hotels (East) Limited (as Transferee Company-II) and its shareholders (the Scheme) in pursuance of Sections 391-394 of the Companies Act,1956 was approved by the Honble High Court of Delhi at New Delhi vide its order dated 13th January,2010 and became effective on 11th February,2010 subsequent to filing of the Court Order with the Registrar of Companies, NCT of Delhi and Haryana w.e.f. 1st November, 2009.

Accordingly, in terms of the Scheme, Hyatt Regency Kolkata, a part of the Kolkata Undertaking as defined in the Scheme, has been transferred, de- • merged and vested in your Company upon the Scheme becoming effective with effect from 1st November, 2009. Further in terms of the Scheme, on allotment of the equity shares of the Company to the members of erstwhile Asian Hotels Limited, the existing shareholding of Asian Hotels Limited in the Company stood cancelled and the Company ceased to be a subsidiary of Asian Hotels Limited and became an independent entity and also in view of effectiveness of the Scheme and as parts of the Kolkata Undertaking as defined in the Scheme, companies namely COS Hotels Limited and Regency Convention Centre & Hotels Limited have become subsidiaries of your Company.

Subsequent to the effectiveness of the Scheme, the name of the Company was changed from Vardhman Hotels Limited to Asian Hotels (East) Limited with effect from 16th February, 2010.

FINANCIAL YEAR

The current financial year of the Company was changed to a period of nine months beginning from 1st July, 2009 and ending on 31st March, 2010. Previous financial year of the Company was for a period of fifteen months beginning from 1st April, 2008 and ending on 30th June, 2009.

FINANCIAL RESULTS

2009-10 (Nine-month period)

Particulars (Rs.)

Sales Turnover (Net) 45,29,24,338

Profit Before Interest & Depreciation etc. 21,79,98,180

Interest -

Depreciation 2,81,97,646

Profit Before Tax 18,98,00,534

Provision for Taxation (Net) 4,69,60,256

Net Profit 14,28,40,278

Surplus Brought Forward 92,69,31,084

Profit Available for Appropriation 106,97,71,362

Transfer to general Reserve 1,42,84,028

Dividend on preference Shares 6,158

Dividend, proposed/Paid-up-Equity 3,42,05,346

Dividend Distribution Tax 58,14,245

Surplus Carried Forward 1,01,54,61,585

Earning per share (Rupees) 22.65 In the period under review, the Companys standalone gross sales were Rs.45.29 crores. The profit before interest, depreciation and taxes was Rs.21.80 crores for the period under review. During nine-month period under review, the Company posted profit after tax of Rs.14.28 crores. The consolidated profit before providing for interest, depreciation and taxes was Rs.22.48 crores for the period under review. The Company has made a consolidated profit after tax of Rs. 14.74 crores during the period under review.

DIVIDEND

Preference Shares

The Company has paid dividend @ 1% on 1,00,000 Non-Convertible Redeemable Preference Shares of the face value of Rs.10/- each (NCPS) for the period from 1st September, 2009 to 31st March, 2010 to the NCPS holders at the time of fully redemption of the said NCPS.

Further, your Board of Directors has recommended a dividend @ 1% on the 27,780 Fully Convertible Preference Shares of the face value of Rs.10/- each (FCPS) to be paid as final dividend for the five-month period ended from 1st November, 2001 to 31st March, 2010 after approval of the members at the ensuing annual general meeting.

Equity Shares

Your Board of Directors is pleased to recommend a dividend of 30% or Rs. 3.00 per equity share for the period ended 31st March, 2010.

BUSINESS OVEREVIEW

In the financial year ended 2009-10, the Indian hotels industry has had to cope with significant contraction because of the aftermath of events like the 26/11, global slowdown, terrorist activities, H1N1 pandemic and travel advisories which only added to the impact of the downturn. As is well known, the Tourism industry also bore the burnt of the global economic crisis resulting in depressed occupancies, Average Room Rates and therefore turnover and profitability. To combat the drop in revenue due to the global events, stringent cost control measures with no compromise in quality were implemented.

Despite the above, the performance of the Company has been satisfactory. The guest satisfaction scores at our hotel reflect that despite the measures, the quality of our hospitality services continues to be at world class levels. Your Directors have a positive view on achieving sustainable and a balance profitable growth in future and have taken a cautious approach on the new properties launched, product up-dation and expansion in domestic market. Hyatt Regency Kolkata was transferred, demerged and vested with the Company after the Scheme of Arrangement and Demerger became effective on 11th February, 2010 with effect from 1st November, 2009 and this 9 month-period under review was the first accounting period of the Company after effectiveness of the Scheme of Arrangement and Demerger and hence there are no corresponding figures of the previous year.

SHARE CAPITAL

Your Company has made the following issues, allotments and redemption in pursuance of the Scheme of Arrangement and Demerger during the period under review.

i) Issuance and allotment of 1,14,01,782 equity shares of Rs. 10/- each fully paid up.

ii) Issuance and allotment of 1,00,000 1% Non-convertible Redeemable Preference Shares (NCPS) of Rs. 10/- each fully paid up.

iii) Issuance and allotment of 27,780 1% Fully Convertible Preference Shares (FCPS) of Rs. 10/- each fully paid up.

iv) Redemption in full of 1,00,000 1% Non-convertible Redeemable Preference Shares (NCPS) of Rs. 10/- each fully paid up on 30* June, 2010.

As a result of the above issuance, allotments and redemption, the number of outstanding shares of the Company as on the date of this Report consists of 1,14,01,782 equity shares of Rs. 10/- each fully paid up and 27,780 1% Fully Convertible Preference Shares (NCPS) of Rs. 10/- each fully paid up respectively.

Equity shares of the Company so issued shall be listed and admitted for trading on the Bombay Stock Exchange Limited (BSE) and the National Stock Exchange of India Limited (NSE).

FOREIGN EXCHANGE EARNINGS AND OUTGO

The Companys earnings and outgo in foreign exchange for the nine-month period under review were Rs. 15.35 crores/Rs. 3.14 crores respectively.

PASSING OF RESOLUTIONS THROUGH POSTAL BALLOT FOR SHIFTING OF REGISTERED OFFICE OF THE COMPANY

Pursuant to Section 192A of the Companies Act, 1956 read with the Companies (Passing of the Resolution by Postal Ballot) Rules 2001, approval of the Members were sought for passing of the Special Resolution through Postal Ballot under Sections 17 and 146(2) of the Companies Act, 1956 for shifting of its Registered Office from the National Capital Territory of Delhi to the State Bengal. The Scrutiniser Ms Pooja Bhatia, Practicing Company Secretary submitted her Report on 14th June, 2010 to the Chairman of the Company. The Special Resolution was approved by the Members of the Company with requisite majority and accordingly the same was passed on 15th June, 2010. The result of the approval of the Members of the above resolution was announced on 15th June, 2010. The Petition for confirming alteration in Memorandum of Association of the Company as to change of place of the Companys Registered Office has been filed before the Company Law Board, Northern Region Bench at New Delhi on 22nd July, 2010 and your Board is confident that the necessary Order of the Company Law Board under Section 17 of the Companies Act, 1956 would be obtained in time so as to allow the Company to hold its forthcoming Annual General Meeting at its Registered Office in the State of West Bengal.

ACQUISITION OF PREFERENCE SHARES

Pursuant to the provisions of Section 372A and other applicable provisions, if any, of the Companies Act, 1956, the Company had invested funds of Rs. 61.54 crores to acquire 43,00,000 12% Cumulative Redeemable Preference Shares of Rs.100/- each held by J P Morgan Advisors India Private Limited in Robust Hotels Private Limited, a company promoted by Saraf Group. Your Board considered it to be prudent to make the investment in view of its potential return and the business opportunity of Hyatt Regency Chennai, a 5 Star Deluxe Hotel being owned & opened by Robust Hotels Private Limited.

APPLICATION TO THE CENTRAL GOVERNMENT

In terms of Section 211(4) of the Companies Act, 1956 necessary application has been made to the Central Government to seek exemption from paras 3(i)(a) and 3(ii)(d) of Part II of Schedule VI of the Companies Act, 1956 dealing with the disclosure of quantitative details of turnover of each class of goods, opening and closing stock, purchases, production and consumption of raw material in the financial statements for a period of 3 years for the Financial Years ending 31st March, 2010, 31st March, 2011 and 31st March, 2012 at a stretch. Approval of the Central Government is pending and is likely to be received soon.

SUBSIDARY COMPANIES

Presently, the Company has two subsidiaries namely GJS Hotels Limited and Regency Convention Centre and Hotels Limited.

The statement pursuant to Section 212 of the Companies Act, 1956 containing details of subsidiaries of the Company forms part of Annual Report and also in terms of the provision of the above section, the audited Annual accounts, for the relevant financial year/period, of the Companys subsidiaries namely GJS Hotels Limited and Regency Convention Centre and Hotels Limited along with their respective Auditors Report and Directors Report thereon, are annexed and form part of this Annual Report.

During the period under review, GJS Hotels Limited had issued 27,91,000 equity shares of Rs.10/- each at a premium of Rs.205/- per share i.e., at a issue price of Rs.215/- per share aggregating to about Rs. 60.00 crores to the Company, the holding company to facilitate the trifurcation of Asian Hotels Limited, erstwhile holding company.

AUDITORS & AUDITORS REPORT

M/s S.S. Kothari Mehta & Co., Chartered Accountants, Kolkata, the present auditors of the Company, retire at the forthcoming Annual General Meeting and are eligible for re-appointment as auditors. Members are requested to re-appoint them and fix their remuneration.

During the period under review, Internal Audit of the Company has been carried out by a firm of Chartered Accountants.

The notes on accounts referred to in the Auditors Report are self-explanatory and, therefore, do not call for any further comments.

BOARD OF DIRECTORS

Mr. Umesh Saraf assumed the charge of the post of Managing Director, Asian Hotels (East) Limited with effect from 22nd February, 2010. Subsequently, the Board at its Meeting held on 4th August, 2010 has re-designated him as the Joint Managing Director of the Company. The Board extends a warm welcome to Mr. Umesh Saraf on assumption of post of Joint Managing Director.

Mr. Arun K Saraf assumed the charge of the post of Joint Managing Director, Asian Hotels (East) Limited with effect from 4th August, 2010. The Board extends a warm welcome to Mr. Arun K Saraf on assumption of post of Joint Managing Director.

Mr. R. S. Saraf is retiring by rotation at the forthcoming Annual General Meeting of the Company and being eligible, offers himself for re-appointment.

Mr. S S Bhandari, Mr. Padam Kumar Khaitan and Mr. R S Jhawar were appointed as Additional Directors with effect from 22nd February, 2010 and their candidature for appointment as a director in the ensuing Annual General Meeting of the Company, has been proposed by some members of the Company.

Mr. Sushil Gupta and Mr. Shiv Jatia resigned from the directorship with effect from 11th February, 2010. The Board wishes to place on record its appreciation for the contributions made by Mr. Gupta and Mr. Jatia during their tenure as Directors of the Company.

DIRECTORS RESPONSIBILITY STATEMENT UNDER SECTION 217(2AA) OF THE COMPANIES ACT,1956

Pursuant to Section 217(2AA) of the Act, your Directors confirm as under:

- that in the preparation of annual accounts for the period ended 31st March, 2010, the applicable Accounting Standards have been followed along with proper explanation relating to materials departures, if any;

- that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and pursuant so as to give a true and fair view of the state of affairs of the Company at the end of the financial period under review and of the profit of the Company for the period;

- that the Director have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the Provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

- that the Directors have prepared the annual accounts on a going concern basis.

- the significant accounting policies followed by the Company, and the disclosures and detailed in the Schedules to the Accounts.

INFORMATION REGARDING CONSERVATION OF ENERGY ETC.

The information required pursuant to Section 217(l)(e) of the Act, read with the Companies (Disclosure of Particulars in the report of Board of Directors) Rules ,1988, pertaining to conservation of energy, technology absorption, and foreign exchange earnings and outgo, to the extent possible in the opinion of your Directors, is annexed hereto and forming part of this Report.

PARTICULARS OF EMPLOYEES

As required under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rulesl975, particulars of the employees concerned are annexed hereto and forms part of the Directors Report.

LISTING OF EQUITY SHARES

Your Company has already obtained listing approval from BSE and NSE for listing of its equity shares. Your Board is confident that the equity shares of the Company would be admitted to dealing on both the Stock Exchanges by the time this Annual Report reaches you.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Management Discussion and Analysis Report, Report on Corporate Governance and Compliance Certificate on Corporate Governance are annexed to this Report.

GROUP FOR INTER-SE TRANSFER OF SHARES

As required under Regulation 3(l)(e)(i) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (the Regulations), persons constituting Group as defined in the Monopolies and Restrictive Trade Practices Act, 1969, for the purpose of availing exemption from applicability of the provisions of Regulations 10 to 12 of the aforesaid Regulations comprises: Saraf Industries Limited, Forex Finance Private Limited, Mr. Radhe Shyam Saraf, Mr. Arun K Saraf and Mr. Umesh Saraf.

CORPORATE SOCIAL RESPONSIBILITY

The Company is associated with various charitable, social, religious and philanthropic activities and thereby playing a pro-active role in the socio- economic growth.

ACKNOWLDGEMENT

Your Directors wish to place on record their appreciation towards all associates including customers, the Government of India, Government of West Bengal, Government Agencies, Hyatt Group, Bankers, Suppliers, Shareholders, Employees and others who have reposed their confidence in the Company.

For and on behalf of the Board

Place: Kolkata

Date : 4th August, 2010

(Radhe Shyam Saraf) Chairman


Jun 30, 2009

The Directors are pleased to submit their 28th Report together with the Audited Accounts for the extended period of eighteen-month ended 30th September, 2009, for which requisite approvals were taken from the competent authority.

FINANCIAL RESULTS (Rupees in Crores)

2008-09 2007-08

(Eighteen-mo nth period) (Twelve- mo nth period)

Sales Turnover (Net) 641.53 513.52

Profit Before Interest & Deprecia tion etc. 224.48 248.58

Interest 29.49 21.37

Depreciation 41.35 24.63

Prior Year Adjustments (0.21) 0.51

Profit Before Tax 153.85 202.07

Provision for Taxation (Net) 59.66 70.04

Net Profit 94.19 132.03

Surplus Brought Forward 238.59 118.92

Profit Available for Appropriation 332.78 250.95

Transfer to Capital Redemption Reserve

for NCPS - redeemed / redeemable 41.24 -

Transfer to General Reserve 7.10 9.52

Dividend - Preference Shares 0.22 0.15

Dividend, Proposed/Paid - Equity 2.28 2.28

Dividend Distribution Tax 0.43 0.41

Surplus Carried Forward 281.51 238.59

Earning per share (Rupees) 41.19 57.82



The period under review was a difficult year for the hospitality sector because of global economic downturn and the sad and unfortunate events, which happened in Mumbai on 26th November, 2008. The occupancy levels through out the country, especially in metros, came down drastically affecting the average room rates and the profitability.

In the above backdrop, the Net Sales Turnover for the twelve-month period ended 31st March, 2009, was Rs. 459.12 crores as compared to Rs. 513.53 crores for the same period in the prior year which registered a decline of 10.6% over the previous financial year. Consequently, comparative figures of Net Profit for the twelve-month period ended 31st March, 2009, were Rs. 81.66 crores as compared to Rs. 132.03 crores in the previous year. The recent trends are encouraging and the Board is of the view that the business sentiments would yield better results.

DIVIDEND

Your Directors are pleased to inform that dividend on 1% Cumulative Redeemable Non-convertible Preference Shares of the face value of Rs. 10/- each (NCPS) has been paid/provided for, for the period under review.

Your Directors while approving the accounts in their meeting held on 25th November, 2009, were pleased to recommend, subject to your approval, a final dividend of Re. 1/- per share aggregating to Rs. 2,28,03,564/- on the total then paid up equity capital of the Company, comprising of 22803564 equity shares of Rs. 10/- each as were outstanding as on that date. However, post effectiveness of the Scheme (as detailed under the head "RESTRUCTURING THE COMPANY") the proposed dividend aggregating to Rs. 2,28,03,564/-, if approved by the shareholders, shall be distributed @ Rs. 2/- per share on the reconstructed equity share capital comprising of only 11401782 equity shares of Rs. 10/- each.

FOREIGN EXCHANGE RECEIPTS

The Companys earnings in foreign exchange for the eighteen-month period under review were Rs. 425.76 crores as against Rs. 338.25 crores during the previous year.

SUBSIDIARY COMPANIES

During the period under review, your Company acquired additional interest in Regency Convention Centre and Hotels Limited (RCC), an erstwhile associate company, thus making it a subsidiary. The Companys stake in RCC as at 30th September, 2009 was 58.99%.

Statement pursuant to Section 212 of the Companies Act, 1956 (the Act), detailing the Companys interest in the subsidiaries and other requisite information, is annexed and forms part of the Annual Report. Further, as required under the said Section, the audited Annual Accounts, for the relevant financial years, of the Companys subsidiaries namely GJS Hotels Limited (GJS), Chillwinds Hotels Limited, Vardhman Hotels Limited, Aria Hotels and Consultancy Services Private Limited (Aria) and RCC along with their respective Auditors Report and Directors Report thereon, are annexed and form part of the Annual Report.

During the period under review, Aria has secured allotment of a parcel of land admeasuring 4.55 acres from Delhi International Airport Private Limited (DIAL) for a hotel project.

RESTRUCTURING THE COMPANY

Your Directors are pleased to inform that subsequent to obtaining equity shareholders approval in the Court convened meeting held on 11th December, 2009, the amended Scheme of Arrangement and De-merger between Asian Hotels Limited (as Transferor Company) and its shareholders and creditors; Chillwinds Hotels Limited (as Transferee Company-I) and its shareholders; and Vardhman Hotels Limited (as Transferee Company- II) and its shareholders (the Scheme) in pursuance of Sections 391-394 of the Companies Act, 1956 (the Act), has been approved by the Honble High Court of Delhi at New Delhi vide Order dated 13th January, 2010, and has also become effective on 11th February, 2010, subsequent to filing of the Courts Order with the Registrar of Companies, NCT of Delhi and Haryana.

Accordingly in terms of the Scheme, the Mumbai Undertaking and Kolkata Undertaking have been transferred to and vested in Chillwinds Hotels Limited and Vardhman Hotels Limited respectively, such transfer taking effect as on the "Appointed Date" i.e. 31 st October, 2009. Your Company shall continue to retain the Delhi Undertaking comprising primarily of Hyatt Regency Delhi.

Subsidiaries namely GJS and RCC form part of the Kolkata Undertaking while Aria forms parts of the Mumbai Undertaking. Thus at present, after the effectiveness of the Scheme, the Company has no subsidiary.

BOOK CLOSURE AND ENTITLEMENT TO FRESH SHARES

Post-effectiveness of the Scheme, the reconstructed equity paid-up capital of the Company comprise of 1,14,01,782 equity shares of Rs. 10/- each. Your Directors have fixed the Book Closure Dates beginning Friday, the 26th February, 2010 till Friday, the 19th March, 2010 inclusive of both days, for the purpose of ascertaining the shareholders entitled to receive fresh shares of the Company and Transferee Company-I and Transferee Company-ll. The said dates shall also serve the purpose of ascertaining the entitlements to receive the proposed dividend.

ISSUE / REDEMPTION OF CAPITAL

Subsequent to the Balance Sheet date, in terms of the Scheme, 6314815 1% Fully Convertible Preference Shares of Rs. 10/- each (FCPS) at a premium of Rs. 530/- per FCPS for an aggregate amount of Rs. 341,00,00,100/- were allotted, taking effect from the Appointed Date to Fineline Holdings Limited, a foreign corporate body wholly owned by the Jatia group; and to UDT Enterprises Pty. Ltd., Australia (UDT), nominee of Global Operations Re Ltd., Singapore. UDT is an independent equity investor and is not promoter or person acting in concert with the promoters, directly or indirectly.

During the period under review, 1 crore 1% Non-Convertible Preference Shares of Rs. 10/- each (NCPS) out of 2 crore NCPS issued earlier to Infrastructure Development Finance Company Limited (IDFC) and Magus Estates and Hotels Limited (Magus) were duly redeemed in two tranches, as per the terms of redemption.

FUTURE PROSPECTS

The restructuring of the Company is ultimately expected to result in enhancement of the shareholder value as the trifurcation would lead to operational efficiencies and synergies, and enable each of the promoter groups to vigorously pursue growth and acquisition opportunities for their respective undertakings.

AUDITORS

M/s. Mohinder Puri & Company, Chartered Accountants, New Delhi the present auditors of the Company, retire at the forthcoming Annual General Meeting and are eligible for re-appointment. They have certified that their appointment, if made, will be in accordance with the limits specified under Section 224 (1B) of the Act. The Audit Committee of the Company has recommended their re-appointment.

INTERNAL AUDIT

M/s. S.S. Kothari Mehta & Co., Chartered Accountants, New Delhi acting as the internal auditors, have been conducting periodic audit of the operations of the Company, and the Audit Committee has regularly reviewed their findings.

DIRECTORS

Mr. Adarsh Jatia was appointed as an Additional Director on 10th February, 2010, who holds office up to the date of the ensuing Annual General Meeting. The Company has received a notice under Section 257 of the Act proposing his candidature for the office of director.

Mr. R. K. Jatia resigned from the directorship of the Company effective close of business hours of 10th February, 2010. Mr. R. K. Bhargava, Mr. Lalit Bhasin, Mr. S. K. Chhibber, Mr. S. S. Bhandari, Mr. Sushil Gupta, Mr. Sudhir Gupta, Mr. R. S. Saraf and Mr. Umesh Saraf resigned immediately after the conclusion of the Board meeting held on 11th February, 2010, taking note of the effectiveness of the Scheme.

Mr. Lalit Bhasin, Mr. Dinesh C. Kothari and Mr. Gautam R. Divan were appointed as Additional Directors on 12th February, 2010, who hold office up to the date of the ensuing Annual General Meeting. The Company has received notices under Section 257 of the Act proposing their candidature for the office of director.

Mr. Ramesh Jatia retires by rotation at the ensuing Annual General Meeting, and being eligible, offer himself for reappointment.

DIRECTORS RESPONSIBILITY STATEMENT UNDER SECTION 217(2AA) OF THE COMPANIES ACT, 1956

Pursuant to Section 217 (2AA) of the Act, your Directors confirm as under:

that in the preparation of annual accounts for the period ended 30th September, 2009, the applicable Accounting Standards have been followed along with proper explanation relating to material departures, if any;

that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial period under review and of the profit of the Company for that period;

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

- that the Directors have prepared the annual accounts on a going concern basis.

The significant accounting policies followed by the Company, and the required disclosures are detailed in the Schedules to the Accounts.

INFORMATION REGARDING CONSERVATION OF ENERGY ETC.

The information required pursuant to Section 217(1)(e) of the Act, read with Rule 2 of the Companies (Disclosure of Particulars in the Report of

Board of Directors) Rules, 1988, pertaining to the conservation of energy, technology absorption, and foreign exchange earnings and outgo, to the extent possible in the opinion of your Directors, and forming part of this Report, is given in Annexure A.

PARTICULARS OF EMPLOYEES

The information pursuant to Section 217(2A) of the Act, read with the Companies (Particulars of Employees) Rules, 1975, and forming part of this Report, is given in Annexure B.

LISTING

Your Companys equity shares are presently listed with BSE and NSE.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement, the Report on Corporate Governance, together with Auditors Certificate thereon, are annexed to this Report as Annexure C and D respectively.

MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Clause 49 of the Listing Agreement, the Management Discussion and Analysis Report is given below:

Industry Structure, Development & Outlook

The hospitality sector as a whole was affected drastically due to global meltdown and the Mumbai terror attack, which adversely impacted the occupancy levels and ARR during the period.

Opportunities, Threats, Risks and Concerns

Looking beyond the current crisis, Indian Economy has strong fundamentals and is hopeful to grow at a steady pace, ensuring increased flow of business visitors. Hence, the outlook for the hospitality industry looks quite positive.

The existing infrastructure in the country needs further improvement to support the requirements of the economy expecting development at a faster pace; upcoming events like the Commonwealth Games and to cater to increasing number of foreign tourists.

Review of Operational and Financial performance

The Company has achieved an aggregate turnover of Rs.641.54 crores for the eighteen-month period ended 30th September, 2009. The turnover in the previous year (12 months) was Rs. 513.52 crores.

Profit after taxes for the period under review was Rs. 94.19 crores, compared with previous year profit amounting to Rs 132.03 crores.

Segment wise performance

During the period under review, your Company was primarily operating an integrated hotel business at three different locations viz. Delhi, Mumbai and Kolkata. Other business segment being pursued by the Company namely, power generation is governed by a different set of risks and returns. In this segment, the Company has two Wind Turbine Generators (WTGs), but the assets as well as revenues generated were not significant enough for reporting.

Internal Control Systems and their adequacy

The Company has standard operating procedures for each operational area. It has in place adequate reporting systems in respect of financial performance, operational efficiencies and reporting with respect to compliance of various statutory and regulatory matters. M/s. S.S. Kothari Mehta & Company, Chartered Accountants, had regularly conducted exhaustive internal audits pertaining to all operational areas and their reports were periodically placed before the Audit Committee for its review and recommendations.

The Company has in place adequate internal controls and systems.

Human Resources and Industrial Relations

The success of any organization depends largely on its human resources, its management and good industrial relations. Your Company has always viewed human resource development as a critical activity for achieving its business goals.

The Company enjoys harmonious relationship with its employees. The employee strength of the Company, as on 30th September, 2009 was 1477.

ACKNOWLEDGEMENT

Your Directors place on record their sincere appreciation and gratitude to the Companys valued customers, the Government of India, respective State Governments of Delhi, Maharashtra and West Bengal, and the Financial Institutions and Banks for their continued support and confidence in the Company.

Your Directors also place on record their sincere gratitude to Hyatt International Asia-Pacific Limited for their co-operation and guidance.

Your Directors also commend the sincere efforts put in by the employees at all levels for the growth of the Company.

For and on behalf of the Board

Place : New Delhi Shiv Jatia

Dated : 15th February, 2010 Chairman and Managing Director

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