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Directors Report of Bombay Dyeing & Manufacturing Company Ltd.

Mar 31, 2016

The Directors have pleasure in presenting their Report on the business and operations of the Company alongwith the audited financial statements for the year ended 31st March, 2016.

1. FINANCIAL RESULTS:

(Rs, in crore) Financial Year ended

Particulars Standalone Consolidated

31/03/2016 31/03/2015 31/03/2016 31/03/2015

GROSS TURNOVER AND OTHER INCOME 1983.72 2566.75 1995.28 2577.79

Profit before Finance Costs and Depreciation and amortization expenses 231.31 308.98 233.83 310.58

Finance Costs 282.64 227.22 289.92 232.12

Profit/(Loss) before Depreciation and amortization expenses (51.33) 81.76 (56.09) 78.46

Depreciation and amortization expenses 33.91 46.82 34.36 47.27

PROFIT/(LOSS) BEFORE TAX (85.24) 34.94 (90.45) 31.19

Less: Tax (net) - 10.38 0.53 10.68

Less: Minority interest and share of profit/loss in associates - - 0.09 (0.16)

PROFIT/(LOSS) AFTERTAX (85.24) 24.56 (91.09) 20.35

Add: Balance in Statement of Profit and Loss of Previous Year 103.50 100.37 31.18 100.37

Add/(Deduct): Depreciation on assets where remaining life is Nil, (1.46) (1.54) (1.46) (1.54) recognized in retained earnings

Add/(Deduct): Share in jointly controlled entity and accumulated - - 0.18 (68.11) surplus in associates on consolidation

SURPLUS AVAILABLE FOR APPROPRIATIONS

Appropriations to:

Proposed Dividend 10.33 16.52 10.33 16.52

Dividend Distribution Tax 2.10 3.37 2.10 3.37 Transferred to General Reserve

Balance carried to Balance Sheet 5.83 103.50 (72.16) 31.18

Previous year figures have been regrouped where necessary.

2. COMPANY RESULTS AND DIVIDEND:

The Company''s turnover & other income for the year was Rs, 1,984 crore as against Rs, 2,567 crore in the previous year. The loss for the year was Rs, 85.24 crore compared to a profit ofRs, 24.56 crore in the previous year. Lower sales in Textiles compared to previous year; lower capacity utilization resulting in lower production, inventory loss and volatile crude oil prices largely affected the PSF business; and delay in getting the approvals for construction, increase in time related overheads which remained unabsorbed and lower sales of flats due to difficult market scenario affected the Realty business of the Company. It was further compounded by increase in interest costs.

The construction of two towers at Island City Center ("ICC"), Dadar, by Bombay Realty, i.e. One ICC and Two ICC is in full swing and is expected to be completed as per schedule by 2018.

Home & You, which is the Company''s rebranded textile retail business, will cover larger markets and focus would be to grow the Company''s consumer base. It would do so through product, design innovations, offerings to cater diverse consumer preferences and expand product availability on multi channel platforms.

PSF industry saw a dismal growth of 2% in volume in the country, which was mainly met through increased cheap imports from China. This has in turn affected the Company''s PSF business. The PSF Division is focusing on innovative product mix and cost reduction initiatives in order to reduce its cost.

The Directors have recommended a dividend of 0.50 paise per equity share ofRs, 2/- which is subject to shareholders'' approval.

Despite loss in the year under review, your Directors have recommended dividend out of the balance of surplus in Statement of Profit & Loss.

3. CONSOLIDATED FINANCIAL RESULTS:

The Company has prepared Consolidated Financial Statements in accordance with the applicable Accounting Standards as prescribed under the Companies (Accounts) Rules, 2014 of the Companies Act, 2013. The Consolidated Financial Results reflect the results of the Company and that of its subsidiary and associates. As required under Regulation 34 of the SEBI [Listing Obligations and Disclosure Requirements ("LODR")] Regulations, 2015, the Audited Consolidated Financial Statements together with the Independent Auditors'' Report thereon are annexed and form part of this Report.

The summarized consolidated financial results are provided above.

4. BOMBAY REALTY:

The business of Bombay Realty had to face serious challenges in the past two years on account of weak global clues, general economic slowdown, high interest rates and delay in the receipt of regulatory approvals. This resulted in a slowdown in construction activity, sales and build up of unsold inventory.

The revenues from real estate activity for the year was Rs, 470 crore as compared to Rs, 444 crore in financial year 2014-15. With the receipt of some of the regulatory approvals and the consequent pick up in construction activity, the Company is now fully geared to complete the construction as per schedule and ensure timely delivery of the two towers.

The Company has appointed Hill International Project Management Pvt. Ltd. as the Project Management Consultant (PMC), Sunjaay Athanki Projects Management Pvt. Ltd. (earlier known as Gardiner and Theobald Construction and Property Consultancy Pvt. Ltd.) as the Professional Quantity Surveyor and Larsen & Toubro Limited as General Contractor to undertake the construction work for both the towers of ICC. The construction on the Slum project at ICC has also commenced and handover is expected as per schedule by August, 2018.

Construction of The Plaza'', a Luxury High-Street for International Brands at Worli, which was earlier held up due to legal issues, is expected to re-start in the current financial year.

5. HOME & YOU:

The domestic textile market experienced volume as well as value pressure led by weak demand. The influx of cheaper alternatives from unorganized sector and international markets only compounded the impact on the retail market. The Division''s gross revenue for 2015-16 wasRs, 306 crore as againstRs, 407 crore in the previous year.

Sale of Textile unit at Ranjangaon

The Members of your Company through postal ballot in June 2015, had approved to sell/dispose of its textiles processing unit at B-28, MIDC Industrial Area, Ranjangaon, Maharashtra, ("Undertaking") to Oasis Procon Pvt. Ltd., New Delhi ("Oasis") together with all specified tangible and intangible assets in relation to the Undertaking (excluding its brand name and the specific liabilities), on a slump sale basis as a going concern and on an "as is where is" basis for a consideration ofRs, 230 crore. The net proceeds from the sale of the Undertaking was to be utilized to repay loans and reduce the interest burden of the Company.

As per the terms and conditions reflected in the agreed Term Sheet, the prospective buyers were obliged to complete the transaction not later than 31st July, 2015. However, they failed to make the requisite payments under the contract and the sale deed could not be completed. The Company is in the process of finding a new buyer for the said Unit.

6. POLYESTER DIVISION:

The Division achieved a turnover of Rs, 1,168 crore during the year as compared to Rs, 1,498 crore in the previous year. In volume terms the reduction was about 6%. Sharp drop in crude oil and petrochemical prices during the year resulted in steep decrease in polyester prices and thereby reduction in turnover of the Division. The average capacity utilization at 91% was lower than 93% achieved in the previous year but was significantly better than the industry average capacity utilization of below 80% during the financial year.

The market sentiment in the domestic polyester staple fiber industry was reflected in an overall growth of 2% compared to the previous year. However, PSF imports increased by approximately 25% in volume far exceeding the growth in domestic demand. Increased volatility in raw material prices and increased imports at significantly lower prices have posed challenges to the Company''s Polyester business.

7. SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES:

Pursuant to Section 129(3) of the Companies Act, 2013 ("the Act") read with Rule 5 of the Companies (Accounts) Rules, 2014, the statement containing salient features of the financial statements of the Company''s Subsidiary, Associates and Joint Venture (in Form AOC-1) is forming part of the Consolidated Financial Statements. Your Company does not have any Material Subsidiary [as defined under the SEBI (LODR) Regulations, 2015] as on 31st March, 2016.

Pursuant to Section 136 of the Act, the Company is exempted from attaching to its Annual Report, the Annual Report of the Subsidiary Company viz. Archway Investment Company Limited.

The financial statement of the Subsidiary Company is kept open for inspection by the shareholders at the Corporate Office of the Company. The Company shall provide the copy of the financial statements of its Subsidiary Company to the shareholders upon their request free of cost. The statements are also available on the website of the Company at www.bombaydyeing.com.

8. FIXED DEPOSITS:

During the year, the Company repaid the deposits aggregating to Rs, 95.47 crore. The Company also accepted fixed deposits aggregating toRs, 77.06 crore from 5,119 depositors.

Total deposits outstanding as on 31st March, 2016 amounted to Rs, 78.54 crore out of which 247 deposits aggregatingRs, 1.36 crore had matured, but remained unclaimed.

9. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

The information pertaining to conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014, is annexed herewith as "Annexure A".

10. EMPLOYEE STOCK OPTION SCHEME (ESOS):

The Information pursuant to the provisions of Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, erstwhile SEBI (Employees Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and as per Section 62(1)(b) of the Companies Act, 2013 read with Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 has been provided in "Annexure B" to this Report.

11. RELATED PARTY TRANSACTIONS:

The Company has formulated a policy on dealing with Related Party Transactions. The policy is disclosed on the website of the Company: (we blink http://teknowits.com/bombaydyeing/ Corporategov.aspx). All transactions entered into with Related Parties as defined under the Companies Act, 2013, Clause 49 of the Listing Agreement and Regulation 2(1)(zc) and Regulation 23 of SEBI (LODR) Regulations, 2015, during the financial year were in the ordinary course of business and on an arm''s length basis and do not attract the provisions of Section 188 of the Companies Act, 2013.

During the year, the Company had not entered into any contract/ arrangement/transactions with related parties which can be considered as material in nature. The related party transactions are disclosed under Note No. 50 of the Notes to Financial Statements for the financial year 2015-16.

12. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the Note No. 51 of the Notes to the Financial Statements.

13. INSURANCE:

All the properties including buildings, plant and machinery and stocks have been adequately insured.

14. ANNUAL RETURN:

The extract of Annual Return pursuant to the provisions of Section 92 of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in form MGT - 9 in "Annexure C" of this Report.

15. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

At the Annual General Meeting (AGM) held on 6th August, 2015, the members of the Company had appointed Dr. (Mrs.) Sheela Bhide as Independent Director for a term of five years with effect from 6th August, 2015 up to 5th August, 2020.

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Nusli N. Wadia (DIN: 00015731) retires by rotation and is eligible for re-appointment.

Necessary information for the re-appointment of Mr. Nusli N. Wadia has been included in the notice convening the ensuing AGM and requisite details have been provided in the explanatory statement of the notice. Your directors recommend his re-appointment.

Mr. Jehangir N. Wadia was appointed as the Managing Director of the Company for a period of five years from 1st April, 2011 up to 31st March, 2016. The Board of Directors at its Meeting held on 31st March, 2016, have re-appointed him as the Managing Director of The Company for a further period of five years from 1st April, 2016 up to 31st March, 2021, subject to the approval of the members of the Company.

Excess remuneration payable to Mr. Jehangir N. Wadia, Managing Director for the financial year 2015-16, is subject to the approval of Central Government, in respect of which the Company has made an application and the approval is awaited.

All the Independent Directors have given a declaration under sub- section (7) of section 149 of the Companies Act, 2013 ("the Act") that they meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 26(3) of SEBI (LODR) Regulations, 2015.

During the year, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company.

Eight Board Meetings were duly convened and held during the year and the details of board/committee meetings held are provided in the Corporate Governance Report. The gap between meetings was within the period prescribed under the Companies Act, 2013.

Key Managerial Personnel

During the year under review, Mr. J. C. Bham retired as Company Secretary, with effect from the close of business hours on 31st May, 2015.

Mr. K. Subharaman joined as the Company Secretary of the Company with effect from 1st June, 2015. He resigned as the Company Secretary of the Company with effect from close of the business hours on 30th April, 2016. The new Company Secretary is expected to join in July, 2016.

Mr. Vinod Hiran, joined as the Chief Financial Officer ("CFO") of the Company with effect from 19th May, 2015 and ceased to be the CFO of the Company from 3rd November, 2015. Mr. Puspamitra Das was appointed as the CFO of the Company at the Board Meeting held on 31st March, 2016 and has joined the Company on 4th April, 2016.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013, and revised Clause 49 of the Listing Agreement and Regulation 17(10) of SEBI (LODR) Regulations, 2015, the Board has carried out an annual performance evaluation of its own performance and that of its statutory committees viz. Audit Committee, Stakeholder Relationship Committee, Nomination and Remuneration Committee and Corporate Social Responsibility Committee and that of the individual directors. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

Nomination and Remuneration Policy

The Board has adopted, on recommendation of the Nomination & Remuneration Committee, a policy for selection and appointment of Directors, Senior Management and their remuneration. A brief detail of the policy is given in the Corporate Governance Report and also posted on the website of the Company (we blink http:// teknowits.com/Bombay dyeing/Corporategov.aspx).

16. DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm that:

a) in the preparation of the Annual Accounts, the applicable accounting standards have been followed and there are no material departures;

b) they 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 year and of the loss of the Company for that period;

c) they 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;

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

e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively;

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

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory, cost and secretarial auditors and external consultant(s) and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company''s internal financial controls were adequate and effective during the financial year 2015-16.

17. CORPORATE GOVERNANCE:

Pursuant to Clause 49 of the Listing Agreement and Regulation 17(7) of SEBI (LODR) Regulations, 2015, a Management Discussion and Analysis Report is given in "Annexure D" to this Report. A separate report on Corporate Governance pursuant to Clause 49 of the Listing Agreement and Regulation 34(3) and 53(f) of SEBI (LODR) Regulations, 2015, along with a certificate from the Statutory Auditors of the Company regarding compliance of the conditions of Corporate Governance are annexed to this Report as "Annexure E".

18. PARTICULARS OF EMPLOYEES:

The Information as per Section 197(12) of the Companies Act, 2013, ("the Act") read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms part of this Report as "Annexure F". However, as per the provisions of Section 136 of the Act, the report and accounts are being sent to the Members and others entitled thereto, excluding the information on employees'' remuneration particulars as required under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, which is available for inspection by the Members at the Corporate Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company in this regard.

19. AUDITORS:

Statutory Auditors

The Company''s Auditors, M/s. Kalyaniwalla & Mistry, Chartered Accountants, Mumbai who pursuant to Section 139 of the Companies Act, 2013, retire at the ensuing Annual General Meeting (AGM) of the Company and are eligible for re-appointment from the conclusion of current AGM up to the conclusion of the following AGM. They have confirmed their eligibility under Section 141 of the Act and the Rules framed there under for re-appointment as Auditors of the Company. As required under Clause 49 of the Listing Agreement and Regulation 33.1 (d) ii of SEBI (LODR) Regulations, 2015, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013 read with Rule 14 of the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its Polyester and Real Estate Divisions are required to be audited. The Directors, on the recommendation of the Audit Committee, appointed M/s. N. I. Mehta & Co. to audit the cost accounts of the Company for the financial year ending 31st March, 2016 on a remuneration ofRs, 5,00,000/- (Rupees Five Lakh) plus out of pocket expenses and applicable taxes. The remuneration payable to the Cost Auditor is required to be ratified by the shareholders at the AGM.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Parikh & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Auditor is annexed herewith as "Annexure G".

Internal Auditors

M/s. Aneja & Associates ceased to be internal auditors of the Company with effect from the closing of business hours on 31st December, 2015.

At the Board Meeting held on 18th December, 2015, M/s. Ernst & Young, Chartered Accountants, were appointed as the Internal Auditors of the Company.

20. SIGNIFICANT AND MATERIAL ORDERS:

There were no significant and material orders passed by the regulators or courts or tribunals, which would impact the going concern status and the Company''s operations in future.

21. MATERIAL CHANGES:

The Board of Directors of your Company had approved to sell/ dispose of its textiles processing Unit at B-28, MIDC Industrial Area, Ranjangaon, Maharashtra, details of which have been provided on Page No. 16 of this report.

22. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Internal Audit plays a key role in providing an assurance to the Board of Directors with respect to the Company having adequate Internal Control Systems. The Internal Control systems provide, among other things, reasonable assurance of recording the transactions of its operations in all material respects and of providing protection against significant misuse or loss of Company''s assets. Details about the adequacy of Internal Financial Controls are provided in the Management Discussion and Analysis Report.

23. CORPORATE SOCIAL RESPONSIBILITY:

The Company has constituted a Corporate Social Responsibility (CSR) Committee in accordance with Section 135 of the Companies Act, 2013. The CSR Committee was constituted by the Board of Directors of the Company comprising of three directors including Independent Directors. The CSR policy of the Company and the details about the development of CSR Policy and initiatives taken by the Company on Corporate Social Responsibility during the year are in accordance with the Companies (Corporate Social Responsibility Policy) Rules, 2014 in "Annexure H" to this report provides the requisite details.

24. AUDITORS QUALIFICATIONS:

The remarks, if any, either by the Auditors or by the Practicing Company Secretary in their respective reports have been dealt with appropriately in this report.

25. RISK MANAGEMENT POLICY:

The Company has formulated a Risk Assessment & Management Policy. Your attention is drawn to the Report on Corporate Governance for details.

26. AUDIT COMMITTEE:

The Audit Committee of the Company comprises of 5 Independent Directors. The composition of directors and other details are provided in the Corporate Governance Report of the Company. The Company has established a vigil mechanism through the committee, wherein the genuine concerns can be expressed by the employees and directors. The Company has also provided adequate safeguards against victimization of employees who express their concerns. The Company has provided the details of the vigil mechanism in the Whistle Blower Policy in the Corporate Governance Report and also posted these on the website of the Company: (http://teknowits.com/bombaydyeing/Corporategov. aspx).

27. CHANGE OF REGISTRAR AND SHARE TRANSFER AGENT:

Securities and Exchange Board of India (SEBI) vide its Order - PR No. 66/2016 dated 22nd March, 2016 had passed an interim order against the Company''s Registrar & Transfer Agent (R&TA),

Sharepro Services (India) Pvt. Ltd. ("Sharepro") inter-alia restraining Sharepro and several entities linked with the management of Sharepro from buying, selling or dealing in the securities market or associating themselves with securities market, either directly or indirectly, in any manner, till further directions. Companies who are clients of Sharepro had also been advised by SEBI to change the R&TA.

The Company''s agreement with Sharepro came to an end on 31st March, 2016 by efflux of time.

In line with the SEBI directive, the Company at its Board Meeting held on 31st March, 2016, has appointed M/s. KARVY COMPUTERSHARE PRIVATE LIMITED, ("Karvy") having its Registered Office at "Karvy House" No 46, Avenue 4, Street No. 1, Banjara Hills, Hyderabad 500 034, as the Company''s Registrar and Transfer Agent with effect from 1st April, 2016.

Members are requested to note the change in the Company''s R&TA from Sharepro to Karvy.

28. LISTING AGREEMENT:

The Securities and Exchange Board of India (SEBI), on 2nd September, 2015, issued SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, with the aim to consolidate and streamline the provisions of the Listing Agreement for different segments of capital markets to ensure better enforceability. The said regulations were effective 1st December, 2015. Accordingly, all listed companies were required to enter into the Listing Agreement within six months from the effective date. The Company entered into Listing Agreement with BSE Limited and National Stock Exchange of India Limited in December 2015.

29. APPRECIATION

The Directors express their appreciation to all employees of the various divisions for their diligence and contribution to performance. The Directors also record their appreciation for the support and co-operation received from franchisees, dealers, agents, suppliers, bankers and all other stakeholders. Last but not the least, the Directors wish to thank all shareholders for their continued support.

On behalf of the Board of Directors

Place: Mumbai NUSLI N.WADIA

Date: 27th May, 2016. Chairman


Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting their Report on the business and operations of the Company along with the audited financial statements for the year ended March 31, 2015.

1. FINANCIAL RESULTS:

(Rs. in crore) Financial Year ended

Particulars Standalone

31/03/2015 31/03/2014

GROSS TURNOVER AND OTHER INCOME 2,566.75 2,822.68

Profit before Finance Costs and Depreciation 308.98 284.18 and amortization expenses

Finance Costs 227.22 191.02

Profit before Depreciation and amortization 81.76 93.16 expenses

Depreciation and amortization expenses 46.82 60.02

PROFIT BEFORE TAX 34.94 33.14

Less: Tax (net) 10.38 8.80

Less: Minority interest and share of profit/ - - loss in associates

PROFIT AFTER TAX 24.56 24.34

Add: Balance in Statement of Profit and Loss 100.37 97.79 of Previous Year

Add / (Deduct): Depreciation on assets where remaining life is Nil, recognized in retained earnings

Add / (Deduct): Share in jointly controlled entity and accumulated surplus in associates on consolidation

SURPLUS AVAILABLE FOR APPROPRIATIONS Appropriations to:

Proposed Dividend 16.52 16.52

Dividend Distribution Tax 3.37 2.81

Transferred to General Reserve - 2.43

Balance carried to Balance Sheet 103.50 100.37

Financial Year ended Particulars Consolidated 31/03/2015

GROSS TURNOVER AND OTHER INCOME 2,577.79

Profit before Finance Costs and Depreciation 310.58 and amortization expenses

Finance Costs 232.12

Profit before Depreciation and amortization 78.46 expenses

Depreciation and amortization expenses 47.27

PROFIT BEFORE TAX 31.19

Less: Tax (net) 10.68

Less: Minority interest and share of profit/ (0.16) loss in associates

PROFIT AFTER TAX 20.35

Add: Balance in Statement of Profit and Loss 100.37 of Previous Year

Add / (Deduct): Depreciation on assets where remaining life is Nil, recognized in retained earnings

Add / (Deduct): Share in jointly controlled (68.11) entity and accumulated surplus in associates on consolidation

SURPLUS AVAILABLE FOR APPROPRIATIONS Appropriations to:

Proposed Dividend 16.52

Dividend Distribution Tax 3.37

Transferred to General Reserve -

Balance carried to Balance Sheet 31.18

Previous year figures have been regrouped where necessary.

2. COMPANY RESULTS AND DIVIDEND

The Company's turnover for the year was Rs. 2,512 crore as against Rs. 2,783 crore in the previous year. The profit for the year was Rs. 24.56 crore, which is similar to the previous year's figure of Rs. 24.34 crore.

Bombay Realty has commenced the construction of two towers at Island City Center ("ICC"), Dadar, i.e. One ICC and Two ICC which is expected to be completed as per schedule. It has also resumed construction work at The Plaza, its Luxury High-Street for International brands at the Wadia International Center, Worli and the same is likely to be completed in the financial year 2015-16.

Home & You, which is the Company's new and rebranded retail business, will see all its 300 stores refurbished with a 'new' store, service and product experience. The Company will continue to invest and strengthen its product categories and their availability.

Polyester Staple Fibre (PSF) demand both in India and across overseas has grown by 4 to 5 % p.a. and this growth is expected to continue in the foreseeable future. The PSF Division is focusing on innovative product mix and cost reduction initiatives in order to reduce its cost.

The Directors have recommended a dividend of Rs. 0.80 per equity share of Rs. 2/- which is the same as per the previous year, subject to shareholders' approval.

3. BOMBAY REALTY

The general economic slowdown witnessed in the last two years, coupled with high interest rates and delay in regulatory approvals seriously affected home-buying decisions, leading to a slowdown in sales and build up of unsold inventory across the market. Consequently, the revenues from real estate activity of your Company were Rs. 444 crore as compared to Rs. 803 crore in the previous year.

The issues of land handover and 'Stop Work Notice' that were holding up the development projects of the Company have been resolved with the Order passed by the Hon'ble High Court, Mumbai. The Company has given advance possession of 32,829.02 sq. mt. of land to MCGM and 33,822.89 sq. mt. of land to MHADA. The Company is now concentrating on construction and timely delivery of the two towers at Dadar. The Company has appointed Hill International Project Management Pvt. Ltd. as the Project Management Consultant, Gardiner and Theobald Construction and Property Consultancy Pvt. Ltd. as the Professional Quantity Surveyor and many other international sub consultants. Larsen & Toubro Limited has been appointed as General Contractor to undertake the construction. Further, construction on the Slum Project at ICC has also commenced and handover is expected by August 2017.

Construction of 'The Plaza', a Luxury High-Street for International Brands at Worli, which was held up due to legal issues has resumed and is now expected to be completed in the financial year 2015-16.

4. HOME & YOU

This Division's turnover has increased from Rs. 535 crore to Rs. 570 crore for the year ended March 31, 2015 recording a growth of 6% over the previous year. Export turnover for the financial year 2014-15 was Rs. 54.85 crore as against previous year turnover of Rs. 67.72 crore.

Despite sluggish consumer demand and sentiment, domestic business grew by a sizeable 16%. Growth was driven by expansion in the retail channel and launch of new & differentiated products and designs in the Company's core categories of bed and bath. The Company's investment in brand building, as part of the growth & market strategy, resulted in a market share gain of 3% and helped it further consolidate its leadership position.

The Company had won the CNBC Textile Conclave 2013 Award "Best Domestic Retail Brand - Made Ups & Home Textile", "Brand Revitalization Award" by the World Brand Congress 2013 and the "Brand Leadership Award" in the retail sector, also by the World Brand Congress.

The Company has also won the Asia's Best Marketing Brands 2014, conferred by World Consulting & Research Corporation - 2014.

Sale of Textile unit at Ranjangaon

The Board of Directors of your Company at its meeting held on May 25, 2015 have approved to sell / dispose of its textiles processing unit at B-28, MI DC Industrial Area, Ranjangaon, Maharashtra, ("Undertaking') to Oasis Procon Pvt. Ltd., New Delhi ("Oasis") together with all specified tangible and intangible assets in relation to the Undertaking (excluding its brand name and the specific liabilities), on a slump sale basis as a going concern and on an "as is where is" basis for a consideration of Rs. 230 crore. The net proceeds from the sale of the Undertaking will be utilized to repay loans and reduce the interest burden of the Company.

The sale is conditional upon Shareholders' approval of the Company and other customary closing conditions including legal due diligence. As a term of the sale, the Company has agreed not to directly and/or indirectly engage in the business of export of bed linen/bed linen fabric with any person in the territory of the United States of America for a period of 5 (five) years from the closing date.

The sale of Undertaking is not likely to have any impact on the Company's existing retail business; Home & You.

5. POLYESTER DIVISION

The Division achieved a turnover of Rs. 1,498 crore during the year as compared to Rs. 1,444 crore in the previous year. The average capacity utilization at 93%, was higher than 85% achieved in the previous year and significantly better than the industry average capacity utilization of 80% during the year.

The domestic polyester industry witnessed mixed market sentiments during financial year 2014-15, reflecting an overall moderate growth of 4% compared to the previous year. However, the Polyester Division has recorded a sales volume growth of 15% during the year.

6. SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES

Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, the statement containing salient features of the financial statements of the Company's Subsidiaries', Associates and Joint Ventures (in Form AOC-1) is forming part of the Consolidated Financial Statements. Pursuant to Section 136 of the Companies Act, 2013 ("the Act"), the Company is exempted from attaching to its Annual Report, the Annual Report of the Subsidiary Company viz. Archway Investment Company Limited.

The financial statement of the subsidiary company is kept open for inspection by the shareholders at the Registered Office of the Company. The Company shall provide the copy of the financial statement of its subsidiary company to the shareholders upon their request free of cost. It is also available on the website of the Company.

7. FIXED DEPOSITS

During the year, the Company repaid the deposits aggregating to Rs. 32.93 crore. No new deposits were accepted.

Total deposits outstanding as on March 31, 2015 amounted to Rs. 96.95 crore out of which 466 deposits aggregating Rs. 2.28 crore had matured, but remained unclaimed.

8. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information pertaining to conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014, is annexed herewith as "Annexure A".

9. EMPLOYEE STOCK OPTION SCHEME (ESOS)

The Information pursuant to the provisions of Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, erstwhile SEBI (Employees Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and as per Section 62(1)(b) of the Companies Act, 2013 read with Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 has been provided in "Annexure B" to this Report.

10. RELATED PARTY TRANSACTIONS

The Company has formulated a policy on dealing with Related Party Transactions. The policy is disclosed on the website of the Company: (weblink http://teknowits.com/bombaydyeing/ Corporategov.aspx). All transactions entered into with Related Parties as defined under the Companies Act, 2013 and Clause 49 of the Listing Agreement during the financial year were in the ordinary course of business and on an arm's length basis and do not attract the provisions of Section 188 of the Companies Act, 2013.

During the year, the Company had not entered into any contract/ arrangement/transactions with related parties which can be considered as material in nature. The related party transactions are disclosed under Note No. 50 of the Notes to Financial Statements for the financial year 2014-15.

11. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the Note No. 51 of the Notes to the Financial Statements.

12. INSURANCE

All the properties including buildings, plant and machinery and stocks have been adequately insured.

13. ANNUAL RETURN

The extracts of Annual Return pursuant to the provisions of Section 92 of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in form MGT - 9 in "Annexure C" of this Report.

14. DIRECTORS AND KEY MANAGERIAL PERSONNEL

At the Annual General Meeting of the Company held on August 8, 2014, the members of the Company had appointed the existing Independent Directors i.e. Mr. A. K. Hirjee, Mr. S. S. Kelkar, Mr. R. A. Shah, Mr. S. Ragothaman, Mr. S. M. Palia and Mr. Ishaat Hussain, as Independent Directors for a term of five years with effect from August 8, 2014 upto August 7, 2019.

The Board of Directors has appointed Dr. (Mrs.) Sheela Bhide as an Additional Director, designated as Independent Director of the Company. Her appointment as an Independent Director is for a term of five years with effect from August 6, 2015 upto August 5, 2020.

In accordance with the provisions of the Act and the Company's Articles of Association, Mr. Ness N. Wadia retires by rotation and is eligible for re-appointment.

Necessary resolutions for the appointment / reappointment of Dr. (Mrs.) Sheela Bhide and Mr. Ness Wadia, have been included in the notice convening the ensuing AGM and requisite details have been provided in the explanatory statement of the notice. Your Directors recommend their appointments / reappointment.

The resignation of Ms. Vinita Bali as a Director of the Company was taken on record by the Board..

All the Independent Directors have given a declaration under sub-section (7) of section 149 of the Companies Act, 2013 ("Act") that they meet the criteria of independence as laid down under Section 149 (6) of the Act and Clause 49 of the listing agreement. Excess Remuneration payable to Mr. Jehangir N. Wadia, Managing Director, is subject to the approval of the Central Government, in respect of which the Company has made an application and the approval is awaited.

During the year, six Board Meetings were duly convened and held, the details of which are given in the Corporate Governance Report. The gap between meetings was within the period prescribed under the Companies Act, 2013.

Key Managerial Personnel

Mr. Raghuraj Balakrishna resigned as Chief Financial Officer of the Company with effect from close of the office hours on August 8, 2014.

Mr. Vinod Hiran has been appointed as Chief Financial Officer of the Company with effect from April 24, 2015.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013, and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance and that of its statutory committees viz. Audit Committee, Stakeholder Relationship Committee, Nomination and Remuneration Committee and Corporate Social Responsibility Committee and that of the individual directors. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

Nomination and Remuneration Policy

The Board has adopted, on recommendation of the Nomination & Remuneration Committee, a policy for selection and appointment of Directors, Senior Management and their remuneration. A brief detail of the policy is given in the Corporate Governance Report and also posted on the website of the Company: (weblink http:// teknowits.com/ bombaydyeing/Corporategov.aspx).

15. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm that:

a) in the preparation of the Annual Accounts, the applicable accounting standards have been followed and there are no material departures;

b) they 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 year and of the profit of the Company for that period;

c) they 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;

d) they have prepared the Annual Accounts on a going concern basis.

e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively.

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

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory, cost and secretarial auditors and external consultant(s) and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company's internal financial controls were adequate and effective during the financial year 2014-15.

16. CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement, a Management Discussion and Analysis Report is given in "Annexure D" to this Report. A separate report on Corporate Governance and a certificate from the Statutory Auditors of the Company regarding compliance of the conditions of Corporate Governance are annexed to this Report as "Annexure E".

17. PARTICULARS OF EMPLOYEES

The Information as per Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms part of this Report as "Annexure F". However, as per the provisions of Section 136 of the Act, the report and accounts are being sent to the Members and others entitled thereto, excluding the information on employees' remuneration particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.

18. AUDITORS Statutory Auditors

The Company's Auditors, M/s. Kalyaniwalla & Mistry, Chartered Accountants, Mumbai who pursuant to Section 139 of the Companies Act, 2013, retire at the ensuing Annual General Meeting (AGM) of the Company and are eligible for re-appointment from the conclusion of current AGM up to the conclusion of the following AGM. They have confirmed their eligibility under Section 141 of the Act and the Rules framed thereunder for re-appointment as Auditors of the Company. As required under Clause 49 of the Listing Agreement, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013, read with Rule 14 of the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its Textiles, Polyester and Real Estate Divisions are required to be audited. The Directors, on the recommendation of the Audit Committee, appointed M/s. N. I. Mehta & Co. to audit the cost accounts of the Company for the financial year ending 31st March, 2016 on a remuneration of Rs. 5,00,000/- (Rupees Five Lakh) plus applicable taxes. The remuneration payable to the Cost Auditor is required to be ratified by the shareholders at the AGM.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013, and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Parikh & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Auditor is annexed herewith as "Annexure G".

19. SIGNIFICANT OR MATERIAL ORDERS

There were no significant and material orders passed by the regulators or courts or tribunals, which would impact the going concern status and the Company's operations in future.

20. MATERIAL CHANGES

The Board of Directors of your Company had approved to sell / dispose of its textiles processing unit at B-28, MIDC Industrial Area, Ranjangaon, Maharashtra. The brief description of transaction is given in point no. 4 i.e. Home & You in this report.

21. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY Internal Audit plays a key role in providing an assurance to the Board of Directors with respect to the Company having adequate Internal Control Systems. The Internal Control Systems provide, among other things, reasonable assurance of recording the transactions of its operations in all material respects and of providing protection against significant misuse or loss of Company's assets. The details about the adequacy of Internal Financial Controls are provided in the Management Discussion and Analysis Report.

22. CORPORATE SOCIAL RESPONSIBILITY

The Company has constituted a Corporate Social Responsibility (CSR) Committee in accordance with Section 135 of the Companies Act, 2013. The CSR Committee was constituted by the Board of Directors of the Company comprising of three directors including Independent Directors. The CSR Policy of the Company and the details about the development of CSR Policy and initiatives taken by the Company on Corporate Social Responsibility during the year are in terms of the Companies (Corporate Social Responsibility Policy) Rules, 2014; details of which are appended to this Report as "Annexure H".

23. AUDITORS QUALIFICATIONS

The remarks, if any, either by the Auditors or by the Practising Company Secretary in their respective reports have been dealt with, appropriately in this report.

24. RISK MANAGEMENT POLICY

The Company has formulated a Risk Assessment & Management Policy. The details of the Risk Management are covered in the Corporate Governance Report.

25. AUDIT COMMITTEE

The Audit Committee of the Company comprises of 5 Independent Directors. The composition of directors and other details are provided in the Corporate Governance Report of the Company. The Company has established a vigil mechanism through the Committee, wherein the genuine concerns can be expressed by the employees and Directors. The Company has also provided adequate safeguards against victimization of employees who express their concerns. The Company has provided the details of the vigil mechanism in the Whistle Blower Policy as stated in Corporate Governance Report and also posted on the website of the Company: (http://teknowits.com/bombaydyeing/ Corporategov.aspx).

26. APPRECIATION

The Directors express their appreciation to all employees of the various divisions for their diligence and contribution to performance. The Directors also record their appreciation for the support and co-operation received from franchisees, dealers, agents, suppliers, bankers and all other stakeholders. Last but not the least, the Directors wish to thank all shareholders for their continued support.

On behalf of the Board of Directors

Place: Mumbai NUSLI N.WADIA Date: 25th May, 2015. Chairman


Mar 31, 2013

The Directors hereby present their Report on the business and operations of the Company and the financial accounts for the year ended 31st March, 2013.

1. FINANCIAL RESULTS:

Rs. in crores

For the Year For the Year ended 31st ended 31st March, 2013 March, 2012

GROSS TURNOVER AND OTHER INCOME 2,502.12 2,402.63

Profit before Finance Costs and Depreciation and amortization 334.58 316.81 expenses

Finance Costs 174.74 180.57

Profit before Depreciation and 159.84 136.24 amortization expenses

Depreciation and amortization 62.03 61.39 expenses

PROFIT BEFORE TAX 97.81 74.85

Less: Tax (net) 22.11 15.50

PROFIT AFTER TAX 75.70 59.35

Add: Balance in Statement of 53.82 24.42 Profit and Loss of Previous Year

SURPLUS AVAILABLE FOR APPROPRIATIONS 129.52 83.77

Appropriations to:

Proposed Dividend 20.66 20.66

Dividend Distribution Tax 3.50 3.36

Transferred to General Reserve 7.57 5.93

Balance carried to Balance Sheet 97.79 53.82

Previous year figures have been regrouped where necessary.

2. COMPANY RESULTS AND DIVIDEND

The Company''s turnover for the year rose to Rs. 2,456 crores from Rs. 2,348 crores in the previous year, registering a growth of 5%. The revenue from Real Estate Division rose sharply from Rs. 566 crores in the previous year to Rs. 666 crores in the current year. The Textile Division registered a growth of 7% with a turnover of Rs. 462 crores as compared to Rs. 433 crores in the previous year. Polyester Staple Fibre (PSF) Division registered a turnover of Rs. 1,328 crores compared to Rs. 1,349 crores in the previous year.

The EBITDA for the year at Rs. 335 crores improved by 6% from Rs. 317 crores in the previous year. The Profit before Tax was Rs. 97.81 crores compared to Rs. 74.85 crores in the previous year. The Profit after Tax for the current year was Rs. 75.70 crores as against Rs. 59.35 crores in the previous year.

Your Directors recommend a dividend of Rs. 1/- per equity share ofRs. 2/- each for the year ended 31st March, 2013, to be paid, if declared by the members at the ensuing Annual General Meeting, as compared to dividend of Rs. 5/- per equity share of Rs. 10/- each paid in the previous year. The total dividend outgo for the year under review is Rs. 20.66 crores, the same as last year.

3. REAL ESTATE DIVISION:

The revenue from real estate activity was Rs. 666 crores as compared to Rs. 566 crores in the previous year. The operating profit for the year was Rs. 350 crores as against Rs. 269 crores in the previous year.

Bombay Realty (BR), the real estate division of the Company, has launched two high rise luxury residential towers viz. ''One ICC'' and ''Two ICC'' at Island City Center (ICC), which will have world class amenities and features.

A renowned Architect has been appointed as Lead Consultant for the project. Consultants for Structural Engineering, Mechanical, Electrical & Plumbing, Vertical transportation, Facade, LEED Gold certification etc. have also been appointed. The consultants would be supported by internal experts in these areas. The project will include energy efficient features and use of sustainable material which will ensure substantial operational cost savings in energy and water consumption leading to higher satisfaction levels of occupants as compared to conventional buildings.

During 2012, the Company was required to amend the building designs for ICC to meet the requirements of new Development Control Regulations. The modified building design has been prepared with a view to optimize the building efficiency.

MCGM has issued a Stop Work Order at Company''s Worli Textiles Mill site (WIC) pursuant to withdrawal of approval granted in 2004 for modification to the Textile Mill Modernisation scheme by the Textiles Department of Government of Maharashtra. This has been challenged by the Company in its Writ Petition before Hon''ble Bombay High Court.

Pursuant to the Order of Hon''ble Supreme Court dated 9th August, 2012 for handing over the share of land to MHADA and MCGM at the two mills respectively, the Company has submitted plans for consolidated hand over as per Integrated Development Scheme. Subsequently, as directed by MCGM, the Company has filed an application before Hon''ble Supreme Court for modification of its Order of 9th August, 2012 to enable hand over at single location.

The Directors believe that irrespective of the outcome of the case, the Company''s development plans are not likely to be affected.

The handover of land admeasuring over 66,000 square meters would be one of the largest handover of land in Mumbai. This will enable MHADA to provide housing to over 4,000 families. Besides, the Company would also be rehabilitating over 1,000 families currently residing on the site.

4. TEXTILE DIVISION:

The Textile turnover has increased from Rs. 433 crores in the previous year to Rs. 462 crores for the year ended on 31st March, 2013 i.e. a growth of 7% over previous year. Despite this the division suffered an operational loss of Rs. 12 crores in the current year compared to a profit of Rs. 5 crores in the previous year due to lower margin and adverse product mix.

Domestic business grew by 5% led by mix improvement. Exports turnover grew by 35% from Rs. 34 crores to Rs. 46 crores However, there was a severe pressure on the margins due to slowdown of growth both in domestic and international markets.

In order to provide thrust to domestic retail business, the Company has created a new Retail Division to drive growth in the domestic market.

5. POLYESTER DIVISION:

The Division achieved a turnover of Rs. 1,328 crores during the year as compared to Rs. 1,349 crores in the previous year. The demand and prices of PSF are to a significant extent linked to supply and prices of cotton. During the year, cotton prices continued to remain depressed, leading to lower realization for PSF. Further, it also led to a large number of spinners remaining away from PSF, thereby adversely impacting the volume. Increased capacity in the recycled PSF industry also adversely impacted the PSF business. The average capacity utilization of 81.5%, though lower than 84% achieved in the previous year was significantly better than industry capacity utilization of 71% during the year.

The margins of the PSF Division were adversely impacted due to a sharp increase in the raw material prices in the backdrop of escalating crude oil prices, continuing adverse impact of rupee depreciation and sharp increase in conversion cost due to increase in RLNG and power cost, during the year.

6. FIXED DEPOSITS:

During the year, all the matured fixed deposits were either renewed or repaid except those which were not claimed. The Company also accepted fresh deposits from public and shareholders. Total deposits outstanding as on 31st March, 2013 amounted to Rs. 131.80 crores out of which 122 deposits aggregating Rs. 0.70 crores had matured, but not been claimed.

7. SUB-DIVISION OF EQUITY SHARES:

In terms of the approval accorded by the shareholders through Postal Ballot, each equity share of the face value of Rs. 10/- each fully paid up was sub-divided into 5 equity shares of the face value of Rs. 2/- each fully paid up on and from 31st October, 2012.

8. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

Information pursuant to Section 217(1 )(e) of the Companies Act, 1956 ("the Act") read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is given in Annexure ''A'' to this Report.

9. EMPLOYEE STOCK OPTION SCHEME (ESOS):

Requisite disclosure in respect of the Employee Stock Option Scheme in terms of Clause 12 of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, has been provided in Annexure ''B'' to this Report.

10. INSURANCE:

All the properties including buildings, plant and machinery and stocks have been adequately insured.

11. DIRECTORS:

During 2012, Mr. R. N. Tata stepped down from the Board of various companies in pursuit of engaging in causes which were of personal interest to him. In line with this decision, he also tendered his resignation as Director of the Company vide his letter dated 22nd January, 2013.

The Directors place on record their appreciation of the invaluable contribution and guidance provided by Mr. R. N. Tata.

In accordance with the provisions of the Act and the Company''s Articles of Association, Mr. Keshub Mahindra, Mr. Ishaat Hussain and Mr. Ness N. Wadia retire by rotation and are eligible for re- appointment.

12. DIRECTORS'' RESPONSIBILITY STATEMENT:

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

(i) in the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) they have, in selection of the accounting policies consulted the statutory Auditors and applied them consistently and made judgements 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 year and of the profit of the Company for that period;

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

(iv) they have prepared the Annual Accounts on a going concern basis.

13. CORPORATE GOVERNANCE:

Pursuant to Clause 49 of the Listing Agreement a Management Discussion and Analysis Report is given in Annexure ''C'' to this Report. A separate report on Corporate Governance and a certificate from the Statutory Auditors of the Company regarding compliance of the conditions of Corporate Governance are annexed to this Report as Annexure ''D''.

14. PARTICULARS OF EMPLOYEES:

The Information required under Section 217(2A) of the Act read with the Rules framed thereunder forms part of this Report. However, as per provision of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent to all shareholders excluding the statement of particulars of employees under Section 217(2A) of the Act. Any shareholder interested in obtaining a copy of the statement may write to the Company Secretary at the Company''s Registered Office or Administrative Office.

15. AUDITORS:

Messrs. Kalyaniwalla & Mistry, Chartered Accountants, who are the Statutory Auditors of the Company, hold office upto the conclusion of the ensuing Annual General Meeting and are recommended for re-appointment. As required under the proviso to Section 224(1) of the Act, the Company has obtained written confirmation from Messrs. Kalyaniwalla & Mistry that their appointment, if made, would be in conformity with the limits specified in Section 224(1B) of the Act.

The Central Government accorded its approval to the appointment of Messrs. N. I. Mehta & Company, as the Cost Auditors for auditing the cost accounts relating to Textiles and Polyester for the Financial Year 2012-13. The Cost Audit Reports for Textiles and PSF Divisions were submitted to the Central Government well before the due date of filing the same.

16. APPRECIATION:

The Directors express their appreciation to all the employees at various divisions for their diligence and contribution. The Directors also record their appreciation for the support and co-operation received from the franchisees, dealers, agents, suppliers, bankers and all other stakeholders. Last but not the least the Directors wish to thank the shareholders for their continued support.

On behalf of the Board of Directors

NUSLI N.WADIA

Chairman

Place: Mumbai

Date: 28th May, 2013.


Mar 31, 2012

The Directors hereby present their Report on the business and operations of the Company and the financial accounts for the year ended 31st March, 2012.

1. FINANCIAL RESULTS:

(Rs.in crores)

For the Year ended For the Year ended

31st March, 2012 31st March, 2011

GROSS TURNOVER AND OTHER INCOME 2,285.36 1,911.46

Profit before Finance Costs and Depreciation and amortization expenses 316.81 267.61

Finance Costs 180.57 179.16

Profit before Depreciation and amortization expenses 136.24 88.45

Depreciation and amortization expenses 61.39 62.08

PROFIT BEFORE TAX 74.85 26.37

Less: Tax (net) 15.50 4.98

PROFIT AFTER TAX 59.35 21.39

Add: Balance in Statement of Profit and Loss of Previous Year 24.42 21.66

SURPLUS AVAILABLE FOR APPROPRIATIONS 83.77 43.05 Appropriations to:

Proposed Dividend 20.66 14.19

Dividend Distribution Tax 3.36 2.30

Transferred to General Reserve 5.93 2.14

Balance carried to Balance Sheet 53.82 24.42

Previous year figures have been regrouped where necessary.

2. COMPANY RESULTS AND DIVIDEND:

The Company's turnover for the year rose to Rs 2,403 crores from Rs 2,014 crores in the previous year, registering a growth of 19.3%. The revenue from Real Estate Division rose sharply from Rs 240 crores in the previous year to Rs 575 crores in the current year. The Textile Division registered a growth of 10% with a turnover of Rs 439 crores as compared to Rs 399 crores in the previous year. Polyester Staple Fibre (PSF) Division registered a turnover of Rs 1,381crores compared to Rs 1,369 crores in the previous year.

The EBITDA for the year at Rs 317 crores improved by 18.3% from Rs 268 crores in the previous year. The interest cost at Rs 181 crores remained flat compared to Rs 179 crores, despite a significant increase in the interest rate environment through judicious fund management.

The Company earned Profit before Tax of Rs 74.85 crores compared to Rs 26.37 crores in the previous year. The Profit after Tax for the current year was Rs 59.35 crores as against Rs 21.39 crores in the previous year.

Your Directors recommend a dividend of Rs 5/- per share for the year ended 31st March, 2012, to be paid, if declared by the members at the ensuing Annual General Meeting, as compared to dividend of Rs 3.50 per share paid in the previous year.

3. REAL ESTATE DIVISION:

The revenue from real estate activity was Rs 575 crores as compared to Rs 240 crores in the previous year. The operating profit for the year was Rs 269 crores as against Rs 88 crores in the previous year.

During the year, the Company's Realty Division was re-launched to operate under the name of 'Bombay Realty' (BR). Bombay Realty will launch and execute new projects under this brand.

Bombay Realty launched the 'Island City Centre' (ICC) in FY12 on the Company's land at Spring Mills in Mumbai. During FY 2011-12, the Company launched two high-rise luxury residential towers ('One ICC 'and 'Two ICC').

Further, the handing over of the apartments at the premium residential tower has been substantially completed. Besides, Bombay Realty has begun the construction of a high-end luxury retail space ('The Plaza') at the 25-acre textile mills at Worli, as the 'Wadia International Center' (WIC). The retail space will have leading luxury brands.

The Division Bench of the Bombay High Court has dismissed the Writ Petition filed by the Company for quashing and setting aside the stop work notices issued by the MCGM pursuant to the direction of the Monitoring Committee established under DCR58(9). The Stop Work notices were directed on the basis that the Company had not surrendered lands to MCGM and MHADA as per the provisions of DCR 58(1)(b) r/w Note (vii). Although the Bench dismissed the Writ Petition, it has continued the interim order passed till 31st July, 2012 to enable the Company to appeal. The Company proposes to challenge the same before the Supreme Court. The directors believe that irrespective of the outcome, the Company's development plans are not likely to be affected.

4. TEXTILE DIVISION:

The overall turnover grew by 10% from Rs 399 crores to Rs 439 crores led by the domestic retail business while the average realization rose by 15% due to improved mix as also increase in prices. However, sales meter age dropped by 6% due to weaker consumer sentiments at retail level in the second half of the year. Exports turnover remained flat at Rs 38 crores, while the meter age declined by 29% due to sluggish market conditions in USA and Europe.

The Division has made a significant improvement at operating level in the current year by achieving an operating profit of Rs 9 crores as compared to operating loss of Rs 21 crores in the previous year. This was possible due to strengthening of product mix as well as improved realization.

5. POLYESTER DIVISION:

The division achieved a turnover of Rs 1,381 crores during the year as compared to Rs 1,369 crores in the previous year. There was a sharp fall in cotton prices compared to previous year which led to a large number of spinners switching away from PSF, thereby adversely impacting the volume. Overall market for PSF declined by 13%, while your Company's volumes were lower by 11%. The Company achieved an average capacity utilization of 84% as compared to 94% in the previous year.

The margins were adversely impacted due to a sharp increase in the raw material prices in the backdrop of escalating crude oil prices, adverse impact of rupee depreciation and sharp increase in conversion cost due to over 100% increase in natural gas price, during the second half of the year. As a result, the division achieved breakeven compared to profit of Rs 150 crores in the previous year.

6. FIXED DEPOSITS:

During the year, your Company decided to offer renewal of fixed deposits which were raised in 2009. The Company also invited fresh fixed deposits from public and shareholders. Total deposits outstanding as on 31st March, 2012 amounted to Rs 102.72 crores out of which 684 deposits aggregating Rs 2.87 crores had matured, but not been claimed. These have been subsequently repaid or renewed, except 209 deposits of total value of Rs 0.83 crores.

7. PREFERENTIAL ISSUE OF WARRANTS TO PROMOTERS:

In accordance with the terms of warrants issued to the Promoters, 7,60,000 warrants were exercised in January 2012 and the Promoters were issued equal number of equity shares at a price of Rs 527.28 per share. The balance 12.67 lakh warrants lapsed due to non-exercise of the same.

8. WADIA BRAND EQUITY & BUSINESS PROMOTION AND SHARED SERVICES AGREEMENT:

The Wadia Group has several companies in diverse sectors like the airlines, food, textiles, chemicals etc. and employs various subject matter experts in areas such as Legal, Finance, Information Technology, Treasury, Taxation, Human Resources, Procurement, Risk Management etc. With a view to maximizing the efficiency and effectiveness of these specialized resources, a formal structure has been created under Nowrosjee Wadia & Sons Limited (NWS) to serve the common interests of all the Group Companies. The combined skills, knowledge and expertise of this structure will benefit all the Group Companies availing of this arrangement.

In order to formalize this structure of common services and avail of the standing of the Wadia Group Brand, the Board of your Company, during the year, approved an Agreement between NWS and your Company to enter into the 'WADIA Brand Equity & Business Promotion and Shared Services Scheme'.

9. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

Information pursuant to Section 217(1)(e) of the Companies Act, 1956 ("the Act,) read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is given in Annexure 'A' to this Report.

10. INSURANCE:

All the properties including buildings, plant and machinery and stocks have been adequately insured.

11. DIRECTORS:

In accordance with the provisions of the Companies Act, 1956 and the Company's Articles of Association, Mr. R. A. Shah, Mr. S. Ragothaman, Mr. S. M. Palia, and Ms. Vinita Bali retire by rotation and are eligible for re-appointment.

12. DIRECTORS' RESPONSIBILITY STATEMENT:

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

(i) in the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departure;

(ii) they have, in selection of the accounting policies consulted the statutory Auditors 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 year and of the profit of the Company for that period;

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

(iv) they have prepared the Annual Accounts on a going concern basis.

13. CORPORATE GOVERNANCE:

Pursuant to Clause 49 of the Listing Agreement a Management Discussion and Analysis Report is given in Annexure 'B' to this Report. A separate report on Corporate Governance and a certificate from the Statutory Auditors of the Company regarding compliance of the conditions of Corporate Governance are annexed to this Report as Annexure 'C'.

14. PARTICULARS OF EMPLOYEES:

The Information required under Section 217(2A) of the Act read with the Rules framed there under forms part of this Report. However, as per provision of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent to all shareholders excluding the statement of particulars of employees under Section 217(2A) of the Act. Any shareholder interested in obtaining a copy of the statement may write to the Company Secretary at the Company's Registered Office or Administrative Office.

15. AUDITORS:

Messrs. Kalyaniwalla & Mistry, Chartered Accountants, who are the Statutory Auditors of the Company, hold office up to the conclusion of the ensuing Annual General Meeting and are recommended for re-appointment. As required under the proviso to Section 224(1) of the Act, the Company has obtained written confirmation from Messrs. Kalyaniwalla & Mistry that their appointment, if made, would be in conformity with the limits specified in Section 224(1B) of the Act.

The Central Government accorded its approval to the appointment of Messrs. N. I. Mehta & Company, as the Cost Auditors for auditing the cost accounts relating to Textiles and Polyester for the FY 2011-12. The Cost Audit Reports for Textiles and PSF Divisions were submitted to the Central Govt. well before the due date of filing the same.

16. APPRECIATION:

The Directors express their appreciation to all the employees at various divisions for their diligence and contribution. The Directors record their appreciation for the support and co-operation received from the franchisees, dealers, agents, suppliers, bankers and all other stakeholders. Last but not the least the Directors wish to thank the shareholders for their continued support.

On behalf of the Board of Directors

NUSLI N.WADIA

Chairman

Place: Mumbai

Date: 28th May, 2012


Mar 31, 2010

The Directors hereby present their Report on the business and operations of the Company and the financial accounts for the year ended 31st March, 2010.

1. FINANCIAL RESULTS:

For the Year ended For the Year ended 31st March, 2010 31st March, 2009 Rupees in Crores Rupees in Crores GROSS TURNOVER AND OTHER INCOME 1732.04 1417.77 Profit before Finance Costs, Depreciation and Voluntary Retirement Compensation 290.59 50.73 Finance Costs 207.46 186.54 Profif(Loss) before Depreciation & Voluntary Retirement Compensation 83.13 (135.81) Depreciation 59.54 55.73 Voluntary Retirement Compensation W/O 1.40 2.06 PROFIT /(LOSS) BEFORE TAX 22.19 (193.60) Less: Tax (net) 3.77 1.02 PROFIT/(LOSS) AFTER TAX 18.42 (194.62) Add: Balance in Profit and Loss Account of Previous Year 16.34 188.59 Debenture Redemption Reserve - 7.50 Transferred from General Reserve - 19.39 SURPLUS AVAILABLE FOR APPROPRIATIONS 34.76 20.86 Appropriations to: Dividend 9.66 3.86 Dividend Distribution Tax 1.60 0.66 General Reserve 1.84 - Balance carried to Balance Sheet 21.66 16.34

2. COMPANY RESULTS AND DIVIDEND:

The Companys turnover increased by over 22% to Rs. 1,732 crores during the current year as compared to Rs.1,418 crores in the previous year. The Textile division recorded decline in turnover from Rs. 334 crores last year to Rs. 294 crores in the current year. The PSF division recorded a turnover of Rs. 867 crores for the current year compared to Rs. 811 crores last year. The- revenue from the Real Estate division during the current year was Rs. 562 crores as compared to Rs. 273 crores last year. The profit after tax for the current year was Rs. 18.42 crores compared to a loss of Rs. 194.62 crores in the previous year.

The financial performance of the Company has improved compared to the last year. The demand for textile products remained stagnant in the domestic market. The export market declined due to low demand in USA and Europe. The performance of the PSF division was adversely impacted due to non availability of raw material and over-supply situation in the market.

The Real Estate Division showed marked improvement due to sale of residential units at a better realization per flat. The Division also sold the remaining space in the commercial building at Worli.

The Companys results were also impacted due to increase in finance costs arising from higher borrowings required for the operations.

Your Directors recommend a dividend of Rs. 2.50 per share for the year ended 31s1 March, 2010 to be paid, if declared by the members at the ensuing Annual General Meeting, as compared to dividend of Re. 1 per share in the previous year.

3. TEXTILE DIVISION:

The overall turnover declined by 12% from Rs. 334 crores to Rs. 294 crores, mainly on account of lower exports at Rs. 50

crores compared to Rs. 80 crores in the previous year. Domestic retail sales witnessed the effect of economic slow-down in the beginning of the year, but recovered during the later part of the year under review. Retail sales at Rs. 158 crores during the year were at the same level as last year.

The profitability of the Division suffered from the effects of falling exports, competition in the domestic market and sharp rise in raw material cost. Several steps have been initiated to improve the performance of the Division such as increased capacity utilization, reduction of factory cost through improved efficiency, lower wastages, reduction in selling & distribution expenses and administrative overheads etc. Inventory and receivables have been reduced considerably resulting in lower burden of interest on working capital.

The Division is striving to improve the sales volume by better marketing in domestic as well as exports market. The international and domestic demand has started looking up with the improved global economic environment.

4. POLYESTER DIVISION:

PSF industry in the country continued to face excess capacity. Despite the adverse conditions the Company could increase sales volume of PSF by 42% as compared to the previous year. The Company achieved average capacity utilization at 77% for the year which is comparable with the industry standards. In March quarter, the capacity utilization rose to 88%.

Division profitability suffered on account of low realization due to severe competition coupled with higher raw material prices. Although export markets expanded, the margins remained under pressure. Switch over from liquid fuel to Natural Gas in second half helped to reduce the energy cost.

The company is pursuing a strategy to increase capacity utilization, confine to focused profitable product range, reduce

cost in areas of operations including import of raw material on long term contract basis and expand the share in the domestic market to improve overall sales realization.

5. REAL ESTATE DIVISION:

The revenue from the Real Estate Division was Rs. 562 crores during the current year compared to Rs. 273 crores in the previous year. During the year the Company sold the remaining part of the commercial building under construction at Worli and also some flats in the building under construction at Spring Mills, Dadar. The Company has also leased out surplus space in the existing properties, income from which has started accruing from March quarter 2010.

The construction of the residential tower at Spring Mills and the commercial building at Textile Mills is nearing coinpletion. The demand for residential property has picked up and prices of the same have also witnessed a steady rise in the past few quarters. Your Company will be progressing the next phase of development with a view to leverage the market trends.

6. FIXED DEPOSITS:

Your Company has discontinued acceptance of fixed deposits from June 2009. Deposits of Rs. 81.14 crores were outstanding as at 31st March, 2010. No deposits have matured as at 31st March, 2010.

7. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

Information pursuant to Section 217(1)(e) of the Companies Act, 1956 ("the Act") read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is given in Annexure A to this -Report.

8. PREFERENTIAL ISSUE OF WARRANTS TO PROMOTERS:

The Board of Directors at its meeting held on 10,h February, 2010 approved the issue of 39,57,000 warrants with option to subscribe to equivalent number of equity shares of Rs. 10 each, subject to shareholders approval. The shareholders overwhelmingly approved the proposal for the issue of the warrants to the Promoters. The warrant will be converted into equity share at Rs. 527.83 per share as determined in accordance with the pricing formula given in terms of Chapter VII of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009. Allotment of warrants would be made on receipt of approvals from BSE and NSE under the listing agreements.

9. INSURANCE:

All the properties including buildings, plant and machinery and stocks have been adequately insured.

10. DIRECTORS:

Mr. P. V. Kuppuswamy retired as the Joint Managing Director of the Company effective 31st March, 2010. The Board appreciates the contribution made by Mr. P. V. Kuppuswamy during his tenure of 28 years with the Company, including 16 years as a Director.

The Board of Directors appointed Mr. Durgesh Mehta as an Additional Director designated as Joint Managing Director and Chief Financial Officer with effect from 1st April, 2010 in accordance with the provisions of Section 260 and 269 of the Act and Article 117 of the Companys Articles of Association. Mr. Mehta holds office up to the date of the ensuing Annual General Meeting. Notice has been received by the Company from a member under Section 257 of the Act, proposing his appointment as a Director.

In accordance with the provisions of the Act and the Companys Articles of Association, Mr. Keshub Mahindra, Mr. R. A. shah and Dr. H. N. Sethna retire by rotation and are eligible for re- appointment.

11. DIRECTORS RESPONSIBILITY STATEMENT:

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

(i) in the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departure;

(ii) they have, in selection of the accounting policies consulted the statutory auditors and applied them consistently and made judgements 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 year and of the profit of the Company for that period;

(iii) they have taken proper and sufficient care, to the best of their knowledge and ability, forthe 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;

(iv) they have prepared the Annual Accounts on a going concern basis.

12. CORPORATE GOVERNANCE:

Pursuant to Clause 49 of the Listing Agreement a Management Discussion and Analysis Report is given in Annexure B to this Report. A separate report on Corporate Governance and a certificate from the Auditors of the Company regarding compliance of the conditions of Corporate Governance are annexed to this Report as Annexure C.

13. PARTICULARS OF EMPLOYEES:

The Information required under Section 217(2A) of the Act read with the Rules framed thereunder forms part of this Report. However, as per provision of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent to all shareholders excluding the statement of particulars of employees under Section 217(2A) of the Act. Any shareholder interested in obtaining a copy of the statement may write to the Company Secretary at the Companys Registered Office.

14. AUDITORS:

Messrs. Kalyaniwalla & Mistry, Chartered Accountants, who are the Statutory Auditors of the Company, hold office upto the conclusion of the ensuing Annual General Meeting and are recommended for re-appointment. As required under the proviso to Section 224(1) of the Act, the Company has obtained written confirmation from Messrs. Kalyaniwalla & Mistry that their appointment, if made, would be in conformity with the limits specified in Section 224(1 B) of the Act.

As per the requirement of Central Government and pursuant to Section 233B of the Act, the Company carries out an audit of cost records relating to the textile division every year. Subject to the approval of the Central Government, the Company has appointed Messrs. N. I. Mehta & Co., Cost Accountants, as auditors to audit the cost accounts of the Textile division for the financial year 2010-11.

15. APPRECIATION:

The Directors express their appreciation to all the employees at various divisions for their diligence and contribution. The Directors record their appreciation for the support and co- operation received from the franchisees, dealers, agents, suppliers, bankers and all other stakeholders. Last but not the least the Directors wish to thank the shareholders for their continued support.

On behalf of the Board of Directors NUSLI N.WADIA CHAIRMAN

Mumbai, 24th May, 2010.

 
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