Home  »  Company  »  Godrej Industries Lt  »  Quotes  »  Directors Report
Enter the first few characters of Company and click 'Go'

Directors Report of Godrej Industries Ltd.

Mar 31, 2017

To the Members,

The Directors have pleasure in presenting the Annual Report along with the Audited Accounts for the Financial Year ended March 31, 2017.

Review of Operations

Your Company’s performance during the year as compared with that during the previous year is summarized below:

(Rs, Crore) (Rs, Crore)

Year Ended March 31 Year Ended March 31

Particulars

2017

2016

Revenue from Operations

1,602.17

1,393.86

Other Income/Exceptional Items

46.88

159.68

Total Income

1,649.05

1,553.54

Total Expenditure other than Finance Costs and Depreciation and Amortization

1,534.11

1,300.67

Profit before Finance Costs, Depreciation and Amortization and Tax

114.94

252.87

Depreciation and Amortization Expense

52.43

44.37

Profit before Finance Costs and Tax

62.51

208.50

Finance Costs (net)

207.86

200.24

Profit before Tax

(145.35)

8.26

Provision for Current Tax

-

9.96

Provision for Deferred Tax

(0.11)

(35.91)

Net Profit

(145.24)

34.21

Surplus brought forward

690.64

788.22

Profit after Tax available for appropriation

545.40

822.43

Appropriation

Your Directors recommend appropriation as under:

Final Dividend including DDT

-

70.78

Dividend excess provided in earlier years

-

(0.01)

Interim dividend declared and paid

-

58.80

DDT on interim dividend distributed

-

11.97

Dividend Distribution Tax (DDT) credit from subsidiaries

-

(9.75)

Transfer to General Reserve

-

-

Surplus Carried Forward

545.40

690.64

Total Appropriation

545.40

822.43

Dividend

The Board of Directors of your Company recommended a dividend of Rs, 1.75 per equity share of Rs, 1/each, aggregating Rs, 58.82 Crore as final dividend for the year ended March 31, 2017.

Dividend Policy

The Dividend policy of the Company is uploaded on the Company''s website. http://www.godreiindustries.com/listing-compliance.aspx

INDUSTRY STRUCTURE AND DEVELOPMENT

The global economy produced a lackluster run in 2016 with global output growth estimate at about 3.1%. This stable average growth rate, masks divergent developments in different country groups. There has been a stronger-than-expected pickup in growth in advanced economies, due mostly to a reduced drag from inventories and some recovery in manufacturing output. In contrast, it is matched by an unexpected slowdown in some emerging market economies, mostly reflecting idiosyncratic factors. Forward-looking indicators such as purchasing managers’ indices have remained strong in the fourth quarter in most areas.

Going forward, the IMF expects the world economy to grow at a slightly faster rate of 3.4% in 2017 and 3.6% in 2018. Growth in advanced economies is projected to be around 1.9% in 2017 and 2.0% in 2018. On the other hand, the growth in emerging economies is projected to increase from 4.1% in 2016 to 4.5% and 4.8% in 2017 and 2018 respectively.

India experienced a slightly sluggish financial year with advance GDP estimates pegging the growth at 7.1%, compared to 7.6% last year (constant price comparison).

On the domestic front, the year was marked by two major domestic policy developments, the passage of the Constitutional amendment, paving the way for implementing the Goods and Services Tax (GST), and the action to demonetize the two highest denomination notes. The GST will create a common Indian market, improve tax compliance and governance, and boost investment and growth. Demonetization has had short-term costs but holds the potential for long-term benefits. Follow-up actions to minimize the costs and maximize the benefits include: fast, demand-driven, demonetization; further tax reforms, including bringing land and real estate into the GST, reducing tax rates and stamp duties; and acting to allay anxieties about over-zealous tax administration. Other major reforms included enactment of the Insolvency and Bankruptcy Code; amendment to the RBI Act for inflation targeting; enactment of the Aadhar bill for disbursement of financial subsidies and benefits; significant reforms in FDI policy; the job creating package for textile sector; and several other measures. These actions would allow growth to return to trend in FY2017-18.

FY2016-17 was a predominantly good year for Indian Agriculture, after two successive droughts, with the first advance estimates pegging the growth rate to be 4.1%. This was on the back of a normal monsoon, implementation of credit and other financial schemes, irrigation fund with NABARD and better support through higher MSP. During the South West Monsoon of 2016 the country as a whole received rainfall which was 97% of its long period average. However, wide regional and crop-wise variations continued to be seen in coverage of irrigated area. As per the Advance Estimates, production of kharif food-grains during FY2016-17 increased by 8.8% as against FY2015-16. During FY2016-17, area sown under all kharif crops taken together was 3.5% higher compared to FY2015-16 while area coverage under rabi crops was 5.9% higher than that of last year. The area coverage under wheat as on 13th January 2017 is 7.1% higher than that in the corresponding week of last year.

Going forward, we expect farm focused interventions in the budget like expansion of crop insurance (Fasal Bima Yojana), expansion of National Agricultural Markets (e-NAM) and added support to animal husbandry and dairy will provide adequate support for growth in this sector.

Volatility in commodity prices continued to affect the oleo-chemicals industry throughout the year. The global over-capacity in fatty alcohols with low growth rates in advanced economies has resulted in subdued demand of fatty alcohols. With re-monetization and early implementation of GST, we expect good growth in the Indian market going forward.

Residential real estate sector in India continued to witness a stagnant growth in FY2016-17. The marginal increase in absorption during first two quarters was more than offset by demonetization in the subsequent two quarters. We are, however, optimistic about the future prospects of the Industry on account of economic and fiscal policy measures being implemented by the government. A sustained GDP growth momentum, reduction in interest rates and subsidies in affordable housing segment are expected to strengthen the volume demand going forward. On the other hand, structural policy reforms in form of real estate regulatory laws are expected to bring more customers to market by facilitating a transparent and controlled regulatory environment. This is expected to eventually boost demand thereby easing the supply pressure in the market. Office space absorption levels have increased last year compared to FY2015-16 and the trend is expected to continue in FY2017-18 on the back of improved business conditions and GDP growth.

There is a separate section on Management Discussion and Analysis appended as Annexure A to this Report, which includes the following:

- Discussion on financial performance with respect to operational performance

- Segment wise performance

- Human Resources and Industrial Relations

- Opportunities and Threats

- Internal Control Systems and their adequacy

- Risks and Concerns

- Outlook

Subsidiary and Associate Companies

Your Company has interests in several industries including animal feeds, poultry, dairy and agro-products, oil palm plantation, property development, personal and home care, etc. through its subsidiary and associate companies.

Godrej Agrovet Limited (GAVL)

Godrej Agrovet Limited, a subsidiary of your Company is a diversified agri business company^^ interests in animal feed, crop protection, dairy and oil palm business along with Joint Venture with the^^^^H ACI Group in Bangladesh for the feed business and Tyson Inc., USA for the poultry and processed food business.

FY2016-17 was a welcome departure from the previous two years for Indian agriculture. A normal monsoon after two back-to-back poor monsoons provided much needed boost to the agri sector.

GAVL was also positively impacted by these conditions as evident in its financial performance. GAVL integrated Astec Life Sciences Limited (Astec) and Cream line Dairy Products Limited (Cream line), with FY2016-17 financials, reflecting the full year performance of these two companies.

In FY2016-17, GAVL recorded consolidated revenue of Rs, 4,985 crore against Rs, 3,819 crore, a growth of 31% over FY2015-16 consolidated revenue. The reported Profit Before Tax for the year was up by 12% to Rs, 375 crore in FY2016-17 against Rs, 335 crore in FY2015-16. The financial numbers are as per IND AS.

Animal Feeds:

The Animal feed business had a flat year, with revenues growing at 3%, due to head winds faced in certain feed categories. While Cattle feed, Layer feed and Fish feed recorded robust growth, the business had flat sales in Shrimp Feed and volumes declined in Broiler feed. Integration as an operating business model had gained ground in Broiler business in the last five years. The prevalence has increased to an extent that majority of the broiler market share has been captured by Integrators. GAVL is working on multiple solution themes to improve its Broiler feed play in coming years. Good monsoons had led to increase in Kharif and Rabi crops. Keeping the critical raw materials prices muted in the second half of FY2016-17, aided the profitability of the business in FY2016-17.

Crop Protection Business:

Good south west monsoons during the year and booking of full year revenue of Astec helped clock the Crop protection business, a growth of 54% in sales in FY2016-17. The business reported sales of Rs, 765 Crore in FY2016-17. The business started sales of Astec''s product portfolio in FY2016-17 and has seen its market share improve across the Azole product fungicide portfolio.

Oil Palm:

Both Crude Palm Oil and Palm Kernel Oil prices in FY2016-17 were robust which resulted in significant improvement in the performance of this business over the last year. Operating performance of the business remained strong. The business recorded Sales of Rs, 507 Crore in FY2016-17, growth of over 25% over FY2015-16. A project to convert the Oil Palm Biomass into value added product was also commissioned in FY2016-17.

Astec Life Sciences Limited & Its Subsidiaries:

FY2016-17 was GAVL''s first full year of operations at Astec. Astec recorded Total Income of Rs, 316 Crore in FY2016-17, a growth of 24% over FY2015-16. Astec saw growth in both Enterprise & Bulk sales and Contract Manufacturing. Astec successfully implemented SAP in FY2016-17 and streamlined all the business processes around it to ensure smoother business operations in future.

Cream line Dairy Products Limited & Its Subsidiary:

FY2016-17 was a robust milk year, with Cream line recording Total Income of Rs, 1,019 Crore, a growth of 9% over FY2015-16. Cream line’s focus on Value added products has started yielding results with the sales of the products portfolio increasing by 24% in FY2016-17 over FY2015-16.

Review of Operations / State of Affairs of Joint Ventures (JVs):

ACI Godrej Agrovet Private Limited, Bangladesh:

The joint venture in Bangladesh recorded a strong volume growth of 16% in FY2016-17 over FY2015- 16. The growth was recorded across all the categories of feed in Bangladesh. The business continues to consolidate and grow its market share in the categories of Feed.

Godrej Tyson Foods Limited:

The processed poultry business sales remained flat in FY2016-17 compared to sales in FY2015-16. The focus of the business will continue to remain investing and building the ‘Real Good Chicken'' and ‘Yummiez'' brands for future growth.

Financial Highlights: For the full financial year, GPL’s Total Income decreased by 24% and stood at Rs, 1,733 crore. However, EBITDA increased by 42% to Rs, 401 crore and net profit increased by 30% to Rs, 207 crore. An important contributor to the strong profit growth has been our flagship project ‘The Trees’ which attained revenue recognition much ahead of schedule.

Sales Highlights: From a sales perspective, despite a weak year on the whole due to regulatory approval delays resulting in a low number of new residential project launches, the projects which we were able to launch received an encouraging response. GPL registered booking volume of 3.1 million sq. ft. and booking value of Rs, 2,020 crore in a weak real estate market. Below are the highlights:

Godrej Golf Links, Noida:

- First GPL project in Noida

- Sold over 6 lakh sq. ft. of villas with a booking value in excess of Rs, 300 crore in a single day

- Sold more than 1 million sq. ft. with a booking value of Rs, 563 crore despite weak market conditions

- Serves as a reflection of GPL’s brand strength, sales capability and ability to successfully attract customers across the country’s leading real estate markets.

Godrej Greens, Pune:

- Witnessed an overwhelming customer response despite being launched immediately after the government’s demonetization announcement

- Sold 420,088 sq. ft. with a booking value of Rs, 187 crore in FY2016-17.

Continued success in business development: FY2016-17 has been a strong year for business development. GPL added 7 new projects with a saleable area of 18 million sq. ft. The government’s announcement of demonetization in addition to implementation of RERA has changed the structural dynamics of the real estate sector. The sector is likely to see a shift towards organized developers as non-serious players with low repute will find it difficult to comply with the increased scrutiny from regulators and home buyers. This will pave way for consolidation in the sector as landowners seek to partner with reputable developers through the joint development model, and cash starved developers monetize their land banks by selling it to developers with strong balance sheets with access to institutional funding. We remain well placed to capitalize on these opportunities in the business development space. GPL’s strong brand and solid governance framework provides us with a strong advantage in increasing the depth of our presence across the country''s leading real estate markets while maintaining a capital light development strategy.

Strong focus on execution: GPL has delivered 4.6 million square feet in FY2016-17, which includes 3.3 million square feet of residential and 1.3 million square feet of commercial space across four cities. We have now delivered over 15 million sq. ft. of real estate in the last 4 years, which demonstrates that our operational delivery is keeping pace with our sales acceleration over the past few years.

Global recognition for sustainability initiatives: GPL was ranked 2nd in Asia & 5th globally by GRESB (Global Real Estate Sustainability Benchmark) - An industry-driven organization which assesses Environmental, Social and Governance (ESG) performance of real estate assets globally. GRESB is committed to rigorous and independent evaluation of the sustainability performance of real assets across the globe. GRESB data is used by more than 200 institutional investors, listed property companies and fund managers and is backed by all leading international real estate associations and industry bodies. It provides investors the tools to benchmark their investments against each other based on property type, country and regional peer groups. GRESB is widely recognized as the global standard for portfolio-level ESG reporting and benchmarking in the real asset sector. In addition, Godrej One, our headquarters received a LEED Platinum Rating under the Commercial Interiors segment from the US Green Building Council (USGBC). This is one of the first such certifications in the country.

Expanding international presence: GPL opened its second international representative office in Singapore. Singapore is an important market opportunity for GPL and our presence will help us to address the needs of the large Indian diaspora located in Singapore and neighboring geographies.

Outlook: The real estate sector is in the midst of a transition. A cyclical downturn combined with demonetization and the implementation of the Real Estate Regulation Act has created short-term uncertainty in the sector. However these same factors will lead to consolidation and improved governance in the sector, which in turn will drive improved consumer confidence. The combination of this improved consumer confidence with far improved affordability that is the result of rising incomes, stagnant prices, and reduced interest rates will propel the sector in a very positive direction over the next several years. The government has put in place many policy reforms to encourage real estate development, especially in the affordable housing space which have the potential to lead to sustained improvements in the sector. We expect 2017 to be a transition year but the years ahead are likely to be very exciting ones for the sector. Our brand, national presence, demonstrated track record, and capabilities put us in a strong position to disproportionately benefit from any improvement in the environment and will allow us to remain on a high growth trajectory in the years ahead.

Natures Basket Limited continues to grow its revenue at double digits thereby achieved Total Income of Rs, 310 Crore, an increase of 15% over the previous year of Rs, 269 Crore.

The Company during the year, worked on defining the long-term strategy for the business. As part of the strategy the management decided to exit out of the underperforming market of Delhi and Hyderabad. Post the exit, the Company has 26 operating stores across 3 cities of Mumbai, Pune and Bangalore. As part of the strategy, NBL has also realigned the portfolio allowing to position NBL as the “Daily Food Delight” stores on the base of providing the “Freshest and Finest” food to our customers. This helps improve frequency and loyalty of our customers. Overall revenue from loyal customers contribute nearly 80% of overall revenue.

The focus is to excel and be a leading Omni Channel player by focusing strongly on Instore as well on line business channels in Daily Food Delight space. Currently, NBL''s online sales stands at 7% of its overall sales. NBL continues to improve its website and App experience through regular updates and improvements.

During the year, NBL has set up a Supply Chain Function to improve overall availability and inventory management, and use of technology for improving in store processes.

The brand continues to win awards in forums like Food & Grocery forum, Franchise India Retail Award for Omni Chanel performance, TRRAIN awards for Customer service etc.

Godrej Consumer Products Limited, an associate of your Company, has continued to grow ahead of the overall FMCG sector, as well as the home and personal care categories that it participates in, despite a challenging macro environment.

On a consolidated basis, GCPL reported a Total Income of Rs, 9,684 crore during the FY2016-17 compared to Rs, 8837 crore for FY2015-16. The net profit grew by 58% at Rs, 1304 crore as compared to Rs, 828 crore during the FY2015-16.

GCPL is a leading emerging markets company. As part of the 120-year young Godrej Group, GCPL is fortunate to have a proud legacy built on the strong values of trust, integrity and respect for others. At the same time, it is growing fast and has exciting, ambitious aspirations.

Today, the Godrej Group enjoys the patronage of 1.1 billion consumers globally, across different businesses. In line with its 3 by 3 approach to international expansion, GCPL is building a presence in 3 emerging markets (Asia, Africa, Latin America) across 3 categories (home care, personal wash, hair care). It ranks among the largest household insecticide and hair care players in emerging markets. In household insecticides, it is the leader in India, the second largest player in Indonesia and expanding its footprint in Africa. It is the leader in serving the hair care needs of women of African descent, the number one player in hair colour in India and Sub-Saharan Africa, and among the leading players in Latin America. It also ranks number two in soaps in India, and is the number one player in air fresheners and wet tissues in Indonesia.

However, it is very important that besides its strong financial performance and innovative, muchloved products, GCPL remains a good company. About 23% of the holding company of the Godrej Group is held in a trust that invests in the environment, health and education. We are also bringing together our passion and purpose to make a difference through our ''Good & Green'' approach to create a more inclusive and greener India.

At the heart of all of this, is a talented team. GCPL takes much pride in fostering an inspiring workplace, with an agile and high performance culture. It is also deeply committed to recognizing and valuing diversity across our teams.

It was ranked the number 1 FMCG Company to work for in the ‘Great Place to Work - Best Workplaces in India 2016’ list; its thirteenth consecutive year on the list. It was also ranked number 12 on the ‘Great Place to Work - Best Workplaces in Asia 2017’ list and ranked among the top 19 ‘Aon Hewitt Best Employers in India - 2017’ survey.

Other Subsidiaries

Godrej International Limited (GINL) is incorporated in the Isle of Man, is a wholly owned subsidiary of the company. GINL trades worldwide in vegetable oils mainly palm and soya.

Godrej International Trading & Investments Pte. Ltd. is registered and located in Singapore and also trades in palm and soya oil as well as in by-products.

Both companies enjoy a well -deserved reputation in the market and enjoyed their best year ever. Our international companies are often quoted in the media and are well-known for their in-house research with regard to S&Ds and Price Outlook.

Godrej International Limited, Labuan is incorporated in the financial centre of Labuan. This company has remained dormant and is not actively trading as yet.

Ensemble Holdings & Finance Limited (EHFL), a wholly owned subsidiary of your Company, is a Non-Banking Finance Company. The total income of EHFL for FY2016-17 was Rs, 12.36 Crore as against that of Rs, 3.10 Crore last year. The Net Profit before Tax of EHFL during the financial year ended March 31, 2017 was Rs, 11.11 Crore as against that of Rs, 3.01 Crore last year.

Pursuant to Regulation 16(1)(c) of the SEBI (Listing Obligations and disclosure requirements) Regulations, 2015 (Listing Regulations), your Company has formulated a policy for determining its ‘material subsidiaries’. The said policy has been uploaded on the Company’s website http://www.godrejindustries.com/Resources/pdf/compliances/material_subsidiaries.pdf

Financial Position

The loan funds at the end of the year stand at Rs, 2,862 crore as compared to Rs, 2,658 crore for the previous year. The net debt equity ratio is 1.76 as compared to 1.51 last year. Your Company continues to hold the topmost rating of [ICRA] A1 from ICRA for its commercial paper program (Rs, 1000 crore) (previous year Rs, 1000 crore). ICRA has reaffirmed an [ICRA] A1 rating for its short term debt instruments/other banking facilities (Rs, 800 crore) (previous year Rs, 800 crore). This rating of ICRA represents highest-credit quality carrying lowest-credit risk. ICRA also reaffirmed [ICRA] AA rating with stable outlook for long-term debt, working capital and other banking facilities (Rs, 1015 crore) (previous year Rs, 1015 crore) and a rating of [ICRA]AA with stable outlook for Non Convertible Debenture program. These ratings represents high-credit quality carrying low-credit risk. ICRA has also assigned a rating of MAA with stable outlook for our Public Deposit scheme. The Public Deposit scheme under the Companies Act, 1956 has been discontinued. Instruments with this rating are considered to have the high-credit quality and low credit risk.

Manufacturing Facilities

The chemicals division of your Company has manufacturing units at Abernathy, Valia, Wadala and Dombivli.

The Ambernath factory is IS0-9001:2008, ISO 14001:2004, ISO 18001:2007, ISO 27001: 2005 certified. Over the last year the factory also got certified for FSSC 22000 and ISO 22716 for Food safety and GMP respectively. The factory has also achieved considerable energy savings over the year.

The Valia factory is ISO-9001:2008, ISO 14001:2004, ISO 18001:2007, ISO 27001: 2005 certified. The Factory has also got certification from FDA, FSSAI and Kosher. We are member of RSPO (Roundtable on Sustainable Palm Oil). The Valia factory haS successfully got GMP B2 certification for Palmitic Acid used as Animal Feed during this year. Company has invested in plants for making specialty products.

Vegoils Division (Wadala) manufactures & sells Edible Oils under “Godrej” Brand. The total turnover of Division for FY2016-17 increased to Rs, 111 Crore against Rs, 61 crore from the previous year. In FY2016-17, the division introduced two new Edible Oils “Godrej Refined Rice Bran Oil” and “Godrej Sesame Oil” for our ever growing health conscious consumers. The division is in the process of modernization of its packing facility which will be completed early next year.

The Dombivali unit has flexibility of producing multiple value added products, mainly fatty esters and amide, used in personal and home care products.

Research and Development (R&D)

ln the year under consideration, our R&D activities have resulted in the innovative process improvements for existing range of products and also launch of several new products. Majority of these new products are high value derivatives of fatty acids and fatty alcohols, with specialty applications in home, personal care products, animal feeds and agri products.

Besides our efforts to manufacture and improve the premium quality fatty acids and fatty alcohols using alternate raw materials, the endeavor to develop new processes through innovations and advanced technologies will be an ongoing activity. We will also continue to focus our attention on high value fractionated fatty acids and fatty alcohols for the polymer, oilfield, lubricant and paper industries. Parallel to all the above oleo chemicals projects, R&D continues its efforts in developing improved and customized specialty surfactants & biosurfactants through in house and external consultation routes.

Human Resource Development and Industrial Relations

During the year under review, industrial relations at all plant locations remained harmonious.

Your Company emphasizes on the safety of people working in its premises. Structured safety meetings were held and safety programmes were organized for them throughout the year.

The total number of persons employed in your Company as on March 31, 2017 were 1164.

Business Responsibility Report

SEBI, vide its circular SEBI/LAD-NRO/GN/2015-16/27 dated December 22, 2015 had mandated inclusion of Business Responsibility Reports (BRR) as part of the Annual Reports for top 500 listed entities based on market capitalization as on March, 31 of every financial year.

A detailed report on your Company’s sustainability initiatives is published in the Business Responsibility Report, as ‘Annexure B’ and forms a part of this report. The BRR describes the initiatives taken by the Company from an environment, social and governance perspective.

Information Systems

Your Company has implemented Digital Signature to send digitally signed invoices to customers & enabled SMS alerts for dispatches which are integrated with SAP thus helping in better customer experience.

Implemented Odex Application at all our weighbridges which sends data online to DGFT site which is a statutory requirement as per the SOLAS guidelines from D.G.Shipping, the VGM Weight related information has to be transmitted electronically from the Approved/Registered Weighbridges.

Business Intelligence is implemented to get Financial Reports from SAP helping in automation of processes.

Employee Stock Grant Scheme 2011 (ESGS) and Employee Stock Option Plan (ESOP)

On May 25, 2016, the Nomination and Compensation Committee approved a total of 1,60,395 stock grants equivalent to 1,60,395 equity shares of the Company to eligible employees in terms of the ESGS 2011 Scheme. The exercise price is Rs, 1/- per equity share. As on March 31, 2017 and in terms of the ESGS Scheme, 2011, a total of 1,48,319 grants were vested and 1,50,941 were exercised and allotted. (Includes 2,622 options which were vested in the previous financial year and, exercised and allotted in the current financial year.)

Disclosure in compliance with Section 62 of the Companies Act, 2013, rule 12 of companies (share capital and debentures) rules, 2014, SEBI (Share based employee benefits) regulations, 2014 and The SEBI (Employee Stock Options Scheme and Employee Stock Purchase Scheme) Guidelines 1999 is given in Annexure C attached and forms a part of this report.

Fixed Deposits

Your Company is currently not accepting public deposits. The management of the Company is thankful to all the investors for their continued trust in the Company. During the year ended March 31, 2017, deposits aggregating Rs, 22.86 crore have been repaid on maturity. The Company has no overdue deposits other than unclaimed deposits.

Depository System

Your Company’s equity shares are available for dematerialization through National Securities Depository Limited and Central Depository Services (India) Limited. As of March 31, 2017, 99.81% of the equity shares of your Company were held in demat form.

Directors

In accordance with the Articles of Association of the Company, the following directors retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for reappointment;

- Ms. T. A. Dubash (DIN 00026028)

- Mr. A. B. Godrej (DIN 00065964)

Your Company had appointed following Non-Executive (Independent) Directors pursuant to Regulation 17 of the Listing Regulations and they are not liable to retire by rotation as per Companies Act, 2013 (the Act);

- Mr. S. A. Ahmadullah (DIN 00037137)

- Mr. A. B. Choudhury (DIN 00557547)

- Mr. K. K. Dastur (DIN 00050199)

- Mr. K. M. Elavia (DIN 00003940)

- Mr. A. D. Cooper (DIN 00026134)

- Mr. K. N. Petigara (DIN 00066162)

Your Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed under sub-section (7) of Section 149 of the Companies Act, 2013

Your Company has conducted a formal Board Effectiveness Review as part of its efforts to evaluate, identify improvements and thus enhance the effectiveness of the Board, its Committees, and Individual Directors. This was in line with the requirements mentioned in the Act.

The HR team of the Company worked directly with the Chairman and the Nomination and Compensation Committee of the Board, to design and execute this process which was adopted by the Board. Each Board Member completed a confidential online questionnaire, providing vital feedback on how the Board currently operates and how it might improve its effectiveness.

The survey comprised four sections and compiled feedback and suggestions on:

- Board Processes (including Board composition, strategic orientation and team dynamics);

- Individual Committees;

- Individual Board Members; and

- the Chairman

The following reports were created, as part of the evaluation:

- Board Feedback Report;

- Individual Board Member Feedback Report; and

- Chairman’s Feedback Report

The overall Board Feedback Report was facilitated by Mr. A. B. Godrej, Chairman. The Individual Committees and Board Members’ feedback was shared with the Chairman. Following his evaluation, a Chairman''s Feedback Report was also compiled.

On the recommendation of the Nomination & Compensation Committee, the Board had framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The details of the Board Appointment Policy are stated below:

Pursuant to Regulation 25(7) of the Listing Regulations, the Company has familiarized the Directors on Goods & Service Tax and a presentation was made to the Directors on New/Emerging products of the Company. The details of Directors familiarization program is uploaded on the Company’s website. http://www.godrejindustries.com/listing-compliance.aspx

Key Managerial Personnel

Mr. N. B. Godrej (DIN: 00066195) has been reappointed as a Managing Director of the Company, for a period of three years from April 1, 2017 to March 31, 2020.

Statutory Auditors

Pursuant to section 139 of the Companies Act, 2013, the Board of the Company has subject to the approval of the shareholders, approved appointment of M/s. BSR & Co., LLP, Chartered Accountants (Firm Regn. No. 101248W/W-100022) as Auditors of the Company to hold office for the period commencing from the conclusion of the 29th Annual General Meeting (AGM) on August 11, 2017 until the conclusion of the 34th AGM in the year 2022 (subject to ratification of their appointment at every AGM), on a remuneration that will be approved by the Board.

You are requested to approve the appointment of Auditors and to authorize the Board to fix their remuneration. The auditors M/s. BSR & Co., LLP, Chartered Accountants, are eligible for appointment. A certificate from the Auditors has been received to the effect that their appointment, if made, would be within the prescribed limits. The Auditor’s Report for the FY2016-17 does not contain any qualification, reservation, adverse remark or disclaimer.

Cost Auditors

Pursuant to the provisions of Section 148 and other applicable provisions, if any, of the Companies Act, 2013, M/s. R. Nanabhoy & Co., Cost Accountants have been appointed as Cost Auditors of the Company for the FY2017-18. They are required to submit the report to the Central Government within 180 days from the end of the accounting year.

Secretarial Auditors

The Board has appointed M/s. A. N. Ramani & Co., Practicing Company Secretaries, to conduct Secretarial Audit for the FY2016-17. The Secretarial Audit Report for the financial year ended March 31, 2017 is annexed herewith marked as Annexure ‘G’ to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

Audit Committee

The Audit Committee, constituted pursuant to the provisions of the Act and the Listing Regulations, has reviewed the accounts for the year ended March 31, 2017. The members of the Audit Committee are Mr. K. K. Dastur, Mr. S. A. Ahmadullah, Mr. K. N. Petigara and Mr. A. B. Choudhury, all Independent Directors.

Policy to Prevent Sexual Harassment at Work Place

Your Company is committed to creating and maintaining an atmosphere in which employees can work together without fear of sexual harassment, exploitation or intimidation. As required under the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, your Company has constituted an Internal Complaints Committee. No complaints were received by the committee during the year under review. Since the number of complaints filed during the year was NIL, the Committee prepared a NIL complaints report. This is in compliance with section 22 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Directors’ Responsibility Statement

The Board has laid down Internal Financial Controls within the meaning of the explanation to section 134 (5) (e) (“IFC”) of the Act. The Board believes the Company has sound IFC commensurate with the nature and size of its business. Business is however dynamic. The Board is seized of the fact that IFC are not static and are in fact a fluid set of tools which evolve over time as the business, technology and possibly even fraud environment changes in response to competition, industry practices, legislation, regulation and current economic conditions. There might therefore be gaps in the IFC as Business evolves. The Company has a process in place to continuously identify such gaps and implement newer and/or improved controls wherever the effect of such gaps might have a material effect on the Company’s operations.

Pursuant to the provisions contained in Section 134 of the Act, the Directors of your Company confirm:

a) that in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) that such accounting policies have been selected and applied consistently, and such judgments and estimates have been made 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 or loss of the Company for that period;

c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company, for preventing and detecting fraud and other irregularities;

d) that the annual accounts have been prepared on a going concern basis.

e) that the proper policies and procedures have been adopted for ensuring the orderly and efficient conduct of its business, including adherence to code of conduct and policies, the safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information and that such policies and procedures are adequate and were operating effectively.

f) that proper systems are in place to ensure compliance of all laws applicable to the Company and that such systems are adequate and operating effectively.

Corporate Governance

As required by the existing Regulation 34(3) of the Listing Regulation, a detailed report on Corporate Governance is included in the Annual Report. The Auditors have certified the Company’s compliance of the requirements of Corporate Governance in terms of Regulation 34(3) of the Listing Regulation and the same is annexed to the Report on Corporate Governance.

Disclosures and Information under the Companies Act, 2013

Pursuant to section 134 and any other applicable sections of the Act, following disclosures and information is furnished to the shareholders:

(a) Conservation of Energy, Technology absorption and Foreign Exchange Earnings and Outgo

‘Annexure D’ to this Report gives information in respect of Conservation of Energy, Technology absorption and Foreign Exchange Earnings and Outgo, required under Section 134(3)(m) of the Act and forms a part of the Boards’ Report

(b) Extract of Annual return

The extract of the annual return as provided under sub section (3) of Section 92 of the Act is given in Form No. MGT 9 as ‘Annexure E’, attached and forms a part of this report.

(c) Board meetings

The Board of Directors of your Company met 4 (four) times during the year under review. The details of Board meetings and the attendance of the Directors are provided in the Corporate Governance Report.

(d) Loans, Guarantees & Investments

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Act are given in the notes to the Financial Statements.

(e) Related Party Transactions

All related party transactions entered into by your Company during the financial year were on an arm’s length basis and were in the ordinary course of business. There were no materially significant related party transactions made by the Company with related parties. Prior omnibus approval of the Audit Committee was obtained for those transactions which were of routine nature. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3) (h) of the Act in Form AOC-2 is not applicable. Attention of members is also drawn to the disclosure of transactions with related parties set out in Note No. 41 of Standalone Financial Statements, forming part of the Annual Report. None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company.

The policy on Related Party Transactions is uploaded on the Company’s website http://www.godrejindustries.com/Resources/pdf/compliances/Policy-on-Related-Party-Transaction.pdf.

(f) Particulars of Employees:

Disclosures with respect to the remuneration of Directors and employees as required under Section 197 of the Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been appended as Annexure ‘F’ to this Report. The information required pursuant to Section 197 of the Act read with Rule 5(2) & (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of your Company is available for inspection by the members at registered office of the Company during business hours on working days 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, whereupon a copy would be sent.

(g) Risk Management

Your Company had formed a Risk Management Committee consisting of the Managing Director and the Whole time Directors. The Committee identifies, evaluates business risks and opportunities. This Committee has formulated and implemented a policy on risk management to ensure that the company’s reporting system is reliable and that the company complies with relevant laws and regulations. The Board of Directors of your Company are of the opinion that, at present, there are no elements of risks which may threaten the existence of the Company.

Your Company has a vigil mechanism named Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. The details of the Whistle Blower Policy are explained in the Corporate Governance Report and also posted on the website of the Company.

(h) Nomination & Remuneration Policy for Senior Management

The details relating to ratio of the remuneration of each director to the median remuneration of the employees of the Company for the FY2016-17 is given in ‘Annexure F’ attached and forms part of this Report.

The policy of your Company on director’s appointment and remuneration of the directors, key managerial personnel and other employees including criteria for determining qualifications, positive attributes, independence of a director, is stated below:

(i) Financials

There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year to which the financial statement relates and the date of the report.

There are no qualifications, reservations or adverse remarks in the Auditors Report and the Secretarial Audit Report for the FY2016-17.

(j) Share Capital

During the year under review your company allotted 1,50,941 equity shares of '' 1 each upon exercise of stock option under Company’s Employee Stock Grants Scheme and 38 bonus equity shares on ESGS in compliance with the scheme of amalgamation of Wadala Commodites Limited with Godrej Industries Limited. Consequently, the paid up share capital of your Company has increased from Rs, 33,59,88,807/- divided into 33,59,88,807 equity shares of Rs, 1 each to Rs, 33,61,39,786/- divided into 33,61,39,786 equity shares of Rs, 1 each.

(k) Significant Court Order received - None Additional Information

The consolidated financial statements of the Company forms a part of this Annual Report. Accordingly, this Annual Report of your Company does not contain the financial statements of its subsidiaries. The Audited Annual Accounts and related information of the Company’s subsidiaries will be made available upon request. These documents will also be available for inspection during business hours at the Company’s registered office in Mumbai, India. The subsidiary companies’ documents will also be available for inspection at the respective registered offices of the subsidiary companies during business hours.

Acknowledgement

Your Directors thank the Union Government, the Governments of Maharashtra and Gujarat as also all the Government agencies, banks, financial institutions, shareholders, customers, employees, fixed deposit holders, vendors and other business associates, who, through their continued support and co-operation, have helped as partners in your Company’s progress.

For and on behalf of the Board of Directors

A. B. Godrej

Chairman

Mumbai, May 22, 2017.


Mar 31, 2017

TO THE MEMBERS

The Directors have pleasure in presenting the Thirty-Second Directors'' Report of your Company along with the financial statements for the financial year ended March 31, 2017.

1. OPERATING RESULTS :

Certain key aspects of the Company''s performance (on a standalone basis) during the financial year ended March 31, 2017, as compared to the previous financial year are summarized below:

Particulars

Financial Year 2016 - 2017 (Rs, In Crores)

Financial Year 2015 - 2016 (Rs, In Crores)

Revenue from Operations

457.14

374.17

Other Income

248.14

222.12

Total Income

705.28

596.29

Profit Before Tax

113.69

31.75

Profit After Tax

124.25

22.73

Other Comprehensive Income

(0.31)

(0.61)

Total Comprehensive Income

123.94

22.12

The Company has adopted Indian Accounting Standards (Ind AS) with effect from April 01, 2016 prescribed under section 133 of the Companies Act, 2013.

2. DIVIDEND:

In terms of the Regulation 43A of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI LODR Regulations”), the Dividend Distribution Policy of the Company is appended as Annexure I to this Report and also available on the website of the Company at https://www.aodreiproperties.com/investor/corporateaovernance.

Your Company has been growing rapidly over the last few years. Given the significant weakness in the real estate market over the period, there have been significant business development opportunities available for the Company. The upcoming implementation of the Real Estate Regulatory Act, 2016 has given further impetus to consolidation in the industry and your Company believes there is considerable opportunity for your Company to add new projects at attractive valuations. With these kind of opportunities available and with our ambition to considerably scale the business, it is important for the Company to conserve cash. With this objective of investing strongly in new project opportunities, the Board of Directors have therefore not recommended any dividend for the financial year ended March 31, 2017.

3. SHARE CAPITAL :

During the financial year ended March 31, 2017, the Company had issued and allotted 104,326 equity shares of'' 5/- each of the Company to its eligible employees on exercise of options granted under the Godrej Properties Limited Employee Stock Grant Scheme, 2011. Consequently, the issued, subscribed and paid-up equity share capital of the Company has increased to 216,364,692 equity shares of '' 5/- each. The Company has neither issued shares with differential rights as to dividend, voting or otherwise nor issued shares (including sweat equity shares) to the employees or Directors of the Company under any Scheme.

4. OVERVIEW OF OPERATIONS:

For the full financial year, GPL''s total income decreased by 24% and stood at Rs, 1,733 crore on a consolidated basis. However, EBITDA increased by 42% to Rs, 401 crore and net profit increased by 30% to Rs, 207 crore. An important contributor to the strong profit growth has been our flagship project ‘The Trees'' which attained revenue recognition much ahead of schedule.

The Company managed to demonstrate strong value addition to its development portfolio despite the current uncertainties and challenges in the real estate environment. GPL added 7 new projects with saleable area of 18 million sq. ft. The new projects signed are located in Bangalore, Pune, National Capital Region and Mumbai. The projects added are all of substantial size and are in line with the Company''s long term strategy of focusing on value accretive and risk efficient models.

From a sales perspective, despite a weak year on the whole due to regulatory approval delays resulting in a low number of new residential project launches, the projects which we were able to launch received an encouraging response. GPL registered booking volume of 3.1 million sq. ft. and booking value of Rs, 2,020 crore in an otherwise weak real estate market.

One project in particular that stood out in FY 2017 was Godrej Golf Links, our first project in Noida. GPL launched Godrej Golf Links in Greater Noida in the first week of November 2016 at a time when the NCR market was in the midst of a major slowdown. We sold over 6 lakh sq. ft. of villas with a booking value well in excess of Rs, 300 crore in a single day. For FY17, we managed to sell more than a million sq. ft. in this project with a booking value of Rs, 563 crore. We are proud of this achievement given that this was our first ever project in Noida and the launch was executed at a time when market conditions were very unsupportive. Godrej Greens in Pune also witnessed an overwhelming customer response despite being launched immediately after the government''s demonetization announcement. We sold 420,088 sq. ft. with a booking value ofRs, 187 crore inFY17at Godrej Greens.

On the operational front, we successfully delivered 4.55 million sq. ft. across four cities. We have now delivered over 15 million sq. ft. of real estate in the last four years which we believe demonstrates that our operational delivery is keeping pace with our sales acceleration over the past few years.

Sustainable development is an important part of our Company''s vision and we have received several recognitions for our leadership in environmental sustainability in FY17. GPL was ranked as the 2nd best developer in Asia and 5th best globally for its leadership in sustainable development by Global Real Estate Sustainability Benchmark Report (GRESB). Godrej One received LEED Platinum Rating for the office premises under the Commercial Interiors segment from the US Green Building Council (USGBC). This is one of the first such certifications in the country. GPL also received significant external recognition with a total of 60 awards being received in FY17.

5. FUTURE PROSPECTS AND OUTLOOK OF THE COMPANY:

A cyclical downturn combined with demonetization and the implementation of the Real Estate (Regulation and Development) Act, 2016 has created short-term uncertainty in the sector. However these same factors will lead to consolidation and improved governance in the sector, which in turn will drive improved consumer confidence. The combination of this improved consumer confidence with far improved affordability that is the result of rising incomes, stagnant prices and reduced interest rates will propel the sector in a very positive direction over the next several years. The infrastructure status accorded to affordable housing is a game changing move that will open up more institutional sources for developers to raise funds at a competitive price. This move will encourage leading developers to enter this segment. We expect 2017 to be a transition year but the years ahead are likely to be very exciting ones for real estate development in India. Our brand, national presence, demonstrated track record and capabilities put us in a strong position to disproportionately benefit from any improvement in the environment and will allow us to remain on a high growth trajectory in the years ahead.

We will continue to pursue new projects through joint development agreements with land owners. In addition, we have also diversified our execution model by undertaking projects as a Project Development Manager on a fee basis. Our mission is to seek superior long-term growth in shareholder value by maximizing returns through optimal financing and fiscal discipline. The Company''s primary growth focus shall be on 4 key markets of Mumbai, NCR, Bengaluru and Pune, while at the same time opportunistically pursuing other key markets. The residential investment platform will enable us to enter projects which require large upfront capital investment.

On the operational front, the company shall be focusing on quick launch turnaround times and swift execution and delivery of projects. The company will continue to improve its project execution capabilities across regions, strengthened through continuously improving internal processes and internal capability building. In addition, a customer centric approach to growth, operational efficiency, optimizing return on capital and developing crisis and risk management capabilities will continue to remain the Company''s focus areas.

6. DEPOSITORY SYSTEM:

Your Company''s equity shares are available for dematerialization through National Securities Depository Limited and Central Depository Services (India) Limited. As on March 31, 2017, 99.98 % of the equity shares of the Company were held in dematerialized form.

7. SCHEME OF AMALGAMATION OF HAPPY HIGHRISES LIMITED WITH THE COMPANY:

Happy High-rises Limited (“HHL”), a wholly owned subsidiary of the Company, was amalgamated with the Company in terms of the Scheme of Amalgamation (‘Scheme’) sanctioned by the National Company Law Tribunal vide its order dated March 29, 2017. The petition for the Scheme was originally filed by HHL with Hon''ble High Court of Judicature at Bombay for approval of the Scheme. Consequent to enforcement of provisions of Companies (Compromise, Arrangements and Amalgamations) Rules, 2016 relating to merger, arrangement etc. with effect from December 15, 2016, cases relating to merger/amalgamations pending immediately before such date before any High Court, stood transferred to the National Company Law Tribunal (Tribunal/NCLT).

Accordingly, the order for approving the said Scheme was passed by the National Company Law Tribunal, Mumbai Bench. The appointed date of the Scheme was May 01, 2016. The Scheme has came into effect from April 25, 2017.

8. EXTRACT OF ANNUAL RETURN:

The Extract of Annual Return as provided under Section 92(3) of the Companies Act, 2013 (the “Companies Act”) and as prescribed in Form No. MGT-9 of the Companies (Management and Administration) Rules, 2014, as amended from time to time, is appended as Annexure II to this Report.

9. NUMBER OF MEETINGS OF THE BOARD:

The Board met 4 (four) times in the financial year ended March 31, 2017 on May 05, 2016, August 09, 2016, November 09, 2016 and February 02, 2017.

10. DIRECTORS’ RESPONSIBILITY STATEMENT:

The Directors hereby confirm that:

i. In the preparation of the annual accounts for the financial year ended March 31, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures;

11. 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 as at March 31, 2017 and of the profit of the Company for the year ended on March 31,2017.

Hi. They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act and rules made there under, as amended, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv. They have prepared the annual accounts for financial year ended March 31, 2017ona ‘going concern'' basis.

v. They have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and have been operating efficiently.

vi. They have devised proper systems to ensure compliance with provisions of all applicable laws and that such systems were adequate and operating effectively.

11. DECLARATION BY INDEPENDENT DIRECTORS:

The Independent Directors of the Company have submitted the declaration of Independence as required under Section 149(7) of the Companies Act, confirming that they meet the criteria of independence under Section 149(6) of the Companies Act and Regulation 16(1)(b) of SEBI LODR Regulations.

12. POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION:

The policy of the Company on directors'' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided under Section 178(3) of the Companies Act, is appended as Annexure III to this Report.

13. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

The details of loans given, investments made, guarantees given and securities provided under Section 186 of the Companies Act, have been provided in the notes to the standalone financial statements.

14. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

All transactions entered into during the financial year 2016 2017 with Related Parties as defined under the Companies Act and SEBI LODR Regulations were in the ordinary course of business and on an arm''s length basis. During the year, the Company had not entered into any transaction referred to in Section 188 of the Companies Act, with related parties which could be considered material under SEBI LODR Regulations. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3) of the Companies Act in Form AOC-2 is not applicable. Attention of Members is drawn to the disclosures of transactions with related parties set out in Notes to Accounts - Note No 48 forming part of the Standalone financial statements.

As required under Regulation 23 of SEBI LODR Regulations, the Company has formulated a Related Party Transactions Policy which is available on the website of the Company at https:// www.aodreiproperties.com/investor/corporateaovernance.

15. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

There have been no material changes and commitments affecting the financial position of the Company which have occurred between March 31,2017 and the date of this Report, other than those disclosed in this Report.

16. PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

The particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 134(3)(m) of the Companies Act read with the Companies (Accounts) Rules, 2014 is appended as Annexure IV to this Report.

17. BUSINESS RISK MANAGEMENT:

The Company has constituted a Risk Management Committee consisting of key executives and an independent director to identify and assess business risks and opportunities. The Risk Management Committee identifies the risks at both enterprise level and at project level.

The business risks identified are reviewed by the Risk Management Committee and a detailed action plan to mitigate identified risks is drawn up and its implementation is monitored. The key risks and mitigation actions are then placed before the Audit Committee of the Company.

18. CORPORATE SOCIAL RESPONSIBILITY:

A Corporate Social Responsibility (CSR) Committee has been constituted in accordance with Section 135 of the Companies Act. The details required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 are given in CSR Report appended as Annexure V to this Report. The CSR Policy is available on the website of the Company at www. aodreiproperties.com/investors.

19. VIGIL MECHANISM:

The Company has established a vigil mechanism for directors, employees and other stakeholders to report their genuine concerns, details of which have been given in the Corporate Governance Report forming part of this Annual Report.

20. ANNUAL EVALUATION OF PERFORMANCE OF THE BOARD:

The Company conducted a formal Board Effectiveness Review as part of its efforts to evaluate, identify improvements and thus enhance the effectiveness of the Board of Directors (Board), its Committees and individual directors. This was in line with the requirements mentioned in the Companies Act and SEBI LODR Regulations.

The Corporate HR team of Godrej Industries Limited and Associate Companies (GILAC) worked directly with the Chairman and the Nomination and Remuneration Committee of the Board, to design and execute this process which was adopted by the Board. Each Board Member completed a confidential online questionnaire, providing vital feedback on how the Board currently operates and how it might improve its effectiveness.

The survey comprised of four sections and compiled feedback and suggestions on:

-Board processes (including Board composition, strategic orientation and team dynamics);

- Individual committees;

- Individual Board members; and

- Chairman''s Feedback Report

The following reports were created, as part of the evaluation:

- Board Feedback Report

- Individual Board Member Feedback Report

- Chairman''s Feedback Report

The overall Board Feedback Report was facilitated by Mr. Keki Dadiseth along with the Independent Directors. The Directors were vocal about the Board functioning effectively, but also identified areas which show scope for improvement. The Individual Committees and Board Members feedback was shared with the Chairman. Following his evaluation, a Chairman''s Feedback Report was also compiled.

21. SUBSIDIARY COMPANIES:

A. Subsidiaries

During the financial year under review, Godrej Vikhroli Properties India Limited (incorporated as a result of conversion of Godrej Vikhroli Properties LLP), Godrej Skyline Developers Private Limited, Godrej Residency Private Limited, Pearlite Real Properties Private Limited, Godrej Real View Developers Private Limited, were incorporated as wholly owned subsidiaries of the Company. Happy Highrises Limited, wholly owned subsidiary of the Company, entered into a share purchase agreement with Citystar Infraprojects Limited and its shareholders and in terms of the said agreement, acquired the entire share capital of Citystar Infraprojects Limited. Consequent upon merger of Happy Highrises Limited with the Company, Godrej Properties Limited has become the member of Citystar InfraProjects Limited.

As at March 31,2017, the Company had 20 subsidiaries under the Companies Act, namely, Godrej Realty Private Limited, Godrej Real Estate Private Limited, Godrej Buildcon Private Limited, Godrej Garden City Properties Private Limited, Godrej Projects Development Private Limited, Godrej Landmark Redevelopers Private Limited, Godrej Redevelopers (Mumbai) Private Limited, Godrej Green Homes Limited, Godrej Home Developers Private Limited, Godrej Hillside Properties Private Limited, Godrej Investment Advisers Private Limited, Godrej Prakriti Facilities Private Limited, Godrej Highrises Properties Private Limited, Godrej Fund Management Pte Ltd, Godrej Genesis Facilities Management Private Limited, Godrej Skyline Developers Private Limited, Godrej Residency Private Limited, Prakritiplaza Facilities Management Private Limited, Godrej Vikhroli Properties India Limited and Citystar Infraprojects Limited.

The Company shall provide a copy of the financial statements of its subsidiary companies to the members of the Company on their request. The financial statements of its subsidiary companies will also be kept open for inspection by any members at the registered office of the Company during business hours and will also be available on the website of the Company.

During the financial year under review, GRIP II Pte. Ltd, an investee company under the Godrej Residential Investment Program II, had entered into Share Subscription, Share Purchase and Shareholders'' Agreements with the Company in respect of Godrej Greenview Housing Private Limited (GGHPL), Wonder Projects Development Private Limited (WPDPL) and Godrej Real View Developers Private Limited (GRVDPL), pursuant to which the Company has sold 80% of the equity share capital of GGHPL, WPDPL and GRVDPL to GRIP II Pte. Ltd. Likewise, the Company also entered into a Share Subscription, Share Purchase and Shareholders'' Agreement with GRIP II Pte. Ltd. pursuant to which the Company has sold 51% of the equity share capital of Pearlite Real Properties Private Limited (‘PRPPL’) to GRIP II Pte. Ltd. Consequently, GGHPL, WPDPL, GRVDPL and PRPPL have ceased to be subsidiary of the Company.

As at March 31, 2017, Wonder Space Properties Private Limited, Wonder City Buildcon Private Limited, Godrej Home Constructions Private Limited, Godrej Greenview Housing Private Limited, Wonder Projects Development Private Limited, Godrej Real View Developers Private Limited, Pearlite Real Properties Private Limited and Godrej One Premises Management Private Limited are associate companies of the Company.

B. Limited Liability Partnerships (LLPs)

Your Company is a partner in the following LLPs as of March 31,2017:

1. Godrej Property Developers LLP

2. Mosiac Landmarks LLP

3. Dream World Landmarks LLP

4. Oxford Realty LLP

5. Godrej SSPDL Green Acres LLP

6. MS Ramaiah Ventures LLP

7. Oasis Landmarks LLP

8. Caroa Properties LLP

9. Amitis Developers LLP

10. Godrej Construction Projects LLP

11. Godrej Housing Projects LLP

12. GodrejLandDevelopersLLP

13. Godrej Developers & Properties LLP

14. GodreiHiahrisesRealtvLLP

15. Godrej Project Developers & Properties LLP

16. AR Landcraft LLP

17. GodrejHighviewLLP

18. PrakhhyatDwellingsLLP

19. GodrejSkyviewLLP

20. Bavdhan Realty @ Pune21 LLP 22. Godrej Projects (Pune) LLP

C. Material Non-Listed Indian Subsidiary:

As at March 31, 2017, Godrej Buildcon Private Limited, a wholly owned subsidiary of the Company was considered material non-listed Indian subsidiary under Regulation 24 of SEBI LODR Regulations and accordingly one Independent Director of the Company was also on the Board of Godrej Buildcon Private Limited.

22. PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES:

As required under SEBI LODR Regulations and Section 129 of the Companies Act, the consolidated financial statements have been prepared by the Company in accordance with the applicable accounting standards and form part of the Annual Report. A statement containing the salient features of the Financial Statements of the subsidiaries, joint ventures and associate companies of the Company in Form AOC-1 as required under Rule 5 of the Companies (Accounts) Rules, 2014 form part of the notes to the financial statements.

23. DETAILS RELATING TO DEPOSITS COVERED UNDER CHAPTER V OF THE COMPANIES ACT, 2013:

Sr.

No.

Particulars

Amount in Rupees

1

Accepted during the year

0

2

Remained unpaid or unclaimed as at the end of the year

12,883,000

3

Whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved:-

0

(i) at the beginning of the year

0

(ii) maximum during the year

0

(iii) at the end of the year

0

4

details of deposits which are not in compliance with the requirements of Chapter V of the Companies Act

0

The Company has not accepted any deposits from its Directors.

24. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:

There are no significant and material orders passed by the regulators/courts/tribunals which would impact the going concern status of the Company and its future operations.

25. INTERNAL FINANCIAL CONTROL SYSTEM:

The Company has an internal financial control system commensurate with the size, scale and complexity of its operations. The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the businesses and functions are systematically addressed through mitigating action on continuing basis. These are routinely tested and certified by Statutory as well as Internal Auditors. The audit observations on internal financial controls are periodically reported to the Audit Committee.

26. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

Mr. Adi B. Godrej, Chairman, stepped down from the Board of the Company with effect from April 01, 2017, with an intent to move away from active participation in the day to day functioning of the Company. He will however, continue to provide high level support in the capacity of Chairman Emeritus. The Board placed on record its appreciation for the valuable services rendered by Mr. Adi B. Godrej to the Company during his tenure as Chairman. Consequent to the said change, Mr. Pirojsha Godrej has been re-designated as Executive Chairman of the Company with effect from April 01, 2017 and Mr. Mohit Malhotra has been re-designated as Managing Director & Chief Executive Officer of the Company with effect from April 01, 2017.

On October 10, 2016, Ms. Parmeshwar A. Godrej, Non Executive Director of the Company, passed away. The Board while recording its heart-felt condolence at the demise of Ms. Parmeshwar A. Godrej, appreciated the contributions made by her towards the growth of the Company from its formative period.

In accordance with the Articles of Association of the Company and the provisions of the Section 152(6)(e) of the Companies Act, Mr. Pirojsha Godrej (DIN: 00432983) will retire by rotation at the ensuing Annual General Meeting and being eligible, offered himself for re-ao Dointment.

Mr. Pirojsha Godrej (DIN: 00432983) - Executive Chairman, Mr. Mohit Malhotra (DIN: 07074531) - Managing Director and Chief Executive Officer, Mr. Rajendra Khetawat -Chief Financial Officer and Mr. Surender Varma - Company Secretary & Chief Legal Officer are the Key Managerial Personnel of the Company as at the date of this Report. Pursuant to the approval of the members accorded at the Annual General Meeting held on August 09,2016, the Company had made the applications to the Central Government for waiver of recovery of excess remuneration paid to Mr. Pirojsha Godrej and Mr. Mohit Malhotra for financial year 2015-16 and to Mr. K T Jithendran for the period April

01, 2015 to December 15, 2015. The Central Government has granted approval for waiver for recovery of excess remuneration paid to Mr. K T Jithendran and directed to recover '' 15.72 lakh out of excess remuneration of '' 2.68 crore paid to Mr. Pirojsha Godrej. The Company has taken necessary steps to recover the amount of '' 15.72 lakh from Mr. Pirojsha Godrej. The approval in respect of application of Mr. Mohit Malhotra is awaited.

27. AUDITORS’ APPOINTMENT:

The Members of the Company at the 29th Annual General Meeting had appointed Kalyaniwalla & Mistry LLP, Chartered Accountants, (Firm Registration no.:104607W/W100166) as the Statutory Auditors of the Company, to hold office from the conclusion of 29th Annual General Meeting of the Company until the conclusion of the 32nd Annual General Meeting.

As per the provisions of the Companies Act, no listed company shall appoint an audit firm as auditors for more than two terms of five consecutive years. The Companies Act also provided for additional transition period of three years from the commencement of the Act i.e. 1st April, 2014. Accordingly, the term of the present Auditors, Kalyaniwalla & Mistry LLP expires at the conclusion of the forthcoming Annual General Meeting. The Board has recommended BSR & Co. LLP, Chartered Accountants, Firm Registration No. 101248W/W-100022, Mumbai as the Company''s new Statutory Auditors for a period of five years commencing from the conclusion of Thirty Second Annual General Meeting till the conclusion of the Thirty Seventh Annual General Meeting. BSR & Co. LLP, Chartered Accountants have confirmed that their appointment, if made, would be within the limits specified under Section 141(3)(g) of the Companies Act and that they are not disqualified to be appointed as statutory auditor in terms of the provisions of Section 139(1), Section 141(2) and Section 141(3) of the Companies Act and the provisions of the Companies (Audit and Auditors) Rules, 2014. The Board of Directors recommends to the Members the appointment of

BSR & Co. LLP, Chartered Accountants as Statutory Auditors of the Company.

There are no qualifications, reservations or adverse remarks or disclaimers made by Kalyaniwalla & Mistry, Statutory Auditors, in their report.

28. COST AUDITORS:

The Board of Directors of the Company, on recommendation of Audit Committee, appointed M/s. R Nanabhoy & Co, Cost Accountants, as Cost Auditors of the Company for the financial year 2017-18 at a fee of Rs, 1,05,000 (Rupees One Lakh Five Thousand only) plus applicable taxes and out of pocket expenses subject to the ratification of the said fees by the Members at the ensuing Annual General Meeting pursuant to Section 148 of the Companies Act.

The cost audit report would be filed with the Central Government within prescribed timelines.

29. SECRETARIAL AUDIT REPORT:

The Board of Directors of the Company have appointed A K Jain & Co., Practicing Company Secretary, to conduct the Secretarial Audit and his Report on Company''s Secretarial Audit is appended to this Report as Annexure VI.

There are no qualifications, reservations or adverse remarks or disclaimers made by A. K. Jain & Co., Company Secretary in practice, in their Secretarial Audit Report.

30. FRAUD REPORTING:

There have been no instances of fraud reported by the Auditors under Section 143(12) of the Companies Act and Rules framed there under either to the Company or to the Central Government.

31. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

The Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34(2) of SEBI LODR Regulations, is appended to this Report.

32. CORPORATE GOVERNANCE:

Your Company is committed to maintaining the highest standards of Corporate Governance and adhering to the corporate governance requirements as set out by Securities and Exchange Board of India. The Report on Corporate Governance as stipulated under SEBI LODR Regulations forms part of the Annual Report. The Certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance as stipulated under Schedule V to SEBI LODR Regulations and applicable provisions of the Companies Act forms part of the Corporate Governance Report.

33. AUDIT COMMITTEE OF THE COMPANY:

Your Company''s Audit Committee comprises the following 7 (seven) Independent Directors, viz. Mr. Keki B. Dadiseth (Chairman), Mrs. Lalita D. Gupte, Mr. Amit B. Choudhury, Mr. Pranay D. Vakil, Dr. Pritam Singh, Mr. S. Narayan and Mr. Amitava Mukherjee.

The composition of the Audit Committee is in compliance with the requirements of Section 177 of the Companies Act and Regulation 18 of SEBI LODR Regulations.

34. PARTICULARS OF EMPLOYEES:

Disclosures with respect to the remuneration of Directors and employees as required under Section 197 of the Companies Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been appended as Annexure VII to this Report. The information required pursuant to Section 197 of the Companies Act read with Rule 5(2)&(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is available for inspection by the Members at registered office of the Company during business hours on working days 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, whereupon a copy would be sent.

35. EMPLOYEES STOCK OPTION SCHEMES:

As required in terms of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, the disclosure relating to Godrej Properties Limited Employee Stock Grant Scheme, 2011 (“GPL ESGS”) is appended as Annexure VIII to this Report.

In view of the global meltdown and lower market prices of the shares of the Company and with a view to protect the interest of the employees of the Company to whom options under Godrej Properties Limited Employee Stock Option Plan (GPL ESOP) have been vested, the exercise period for the vested options was extended to December 27, 2016 with the prior approval of Members. However, none of the employees had exercised their options till December 27, 2016, being the last date of exercise period. Accordingly, the Board terminated the GPL ESOP and all the unexercised 2,41,400 options under the GPL ESOP were rendered lapsed. The lapsed and inappropriate equity shares held by the Trustees of GPL ESOP Trust on the date of termination have been sold on the recognized stock exchanges.

36. BUSINESS RESPONSIBILITY REPORT:

The Business Responsibility Report for the financial year ended March 31, 2017 as stipulated under Regulation 34(2) of SEBI LODR Regulations is attached as part of the Annual Report.

37. AWARDS & RECOGNITIONS:

The Directors take pleasure in informing the Members that the Company, its people and projects were acknowledged with several awards and ratings during the financial year ended March 31, 2017. The details of the award received are given at page no. 8 of this Report.

38. ACKNOWLEDGMENTS:

The Directors wish to place on record their appreciation and sincere thanks to the customers, joint venture partners, shareholders, banks, financial institutions, fixed deposit holders, vendors and other associates, who through their continued support and cooperation, have helped, as partners, in the Company''s progress. The Directors also acknowledge the hard work, dedication and commitment of the employees.

For and on behalf of the Board of Directors of Godrej Properties Limited

Pirojsha Godrej

Place: Mumbai Executive Chairman

Date : May 04, 2017 (DIN: 00432983)


Mar 31, 2017

TO THE MEMBERS

The Directors have pleasure in presenting the Thirty-Second Directors'' Report of your Company along with the financial statements for the financial year ended March 31, 2017.

1. OPERATING RESULTS :

Certain key aspects of the Company''s performance (on a standalone basis) during the financial year ended March 31, 2017, as compared to the previous financial year are summarized below:

Particulars

Financial Year 2016 - 2017 (Rs, In Crores)

Financial Year 2015 - 2016 (Rs, In Crores)

Revenue from Operations

457.14

374.17

Other Income

248.14

222.12

Total Income

705.28

596.29

Profit Before Tax

113.69

31.75

Profit After Tax

124.25

22.73

Other Comprehensive Income

(0.31)

(0.61)

Total Comprehensive Income

123.94

22.12

The Company has adopted Indian Accounting Standards (Ind AS) with effect from April 01, 2016 prescribed under section 133 of the Companies Act, 2013.

2. DIVIDEND:

In terms of the Regulation 43A of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI LODR Regulations”), the Dividend Distribution Policy of the Company is appended as Annexure I to this Report and also available on the website of the Company at https://www.aodreiproperties.com/investor/corporateaovernance.

Your Company has been growing rapidly over the last few years. Given the significant weakness in the real estate market over the period, there have been significant business development opportunities available for the Company. The upcoming implementation of the Real Estate Regulatory Act, 2016 has given further impetus to consolidation in the industry and your Company believes there is considerable opportunity for your Company to add new projects at attractive valuations. With these kind of opportunities available and with our ambition to considerably scale the business, it is important for the Company to conserve cash. With this objective of investing strongly in new project opportunities, the Board of Directors have therefore not recommended any dividend for the financial year ended March 31, 2017.

3. SHARE CAPITAL :

During the financial year ended March 31, 2017, the Company had issued and allotted 104,326 equity shares of'' 5/- each of the Company to its eligible employees on exercise of options granted under the Godrej Properties Limited Employee Stock Grant Scheme, 2011. Consequently, the issued, subscribed and paid-up equity share capital of the Company has increased to 216,364,692 equity shares of '' 5/- each. The Company has neither issued shares with differential rights as to dividend, voting or otherwise nor issued shares (including sweat equity shares) to the employees or Directors of the Company under any Scheme.

4. OVERVIEW OF OPERATIONS:

For the full financial year, GPL''s total income decreased by 24% and stood at Rs, 1,733 crore on a consolidated basis. However, EBITDA increased by 42% to Rs, 401 crore and net profit increased by 30% to Rs, 207 crore. An important contributor to the strong profit growth has been our flagship project ‘The Trees'' which attained revenue recognition much ahead of schedule.

The Company managed to demonstrate strong value addition to its development portfolio despite the current uncertainties and challenges in the real estate environment. GPL added 7 new projects with saleable area of 18 million sq. ft. The new projects signed are located in Bangalore, Pune, National Capital Region and Mumbai. The projects added are all of substantial size and are in line with the Company''s long term strategy of focusing on value accretive and risk efficient models.

From a sales perspective, despite a weak year on the whole due to regulatory approval delays resulting in a low number of new residential project launches, the projects which we were able to launch received an encouraging response. GPL registered booking volume of 3.1 million sq. ft. and booking value of Rs, 2,020 crore in an otherwise weak real estate market.

One project in particular that stood out in FY 2017 was Godrej Golf Links, our first project in Noida. GPL launched Godrej Golf Links in Greater Noida in the first week of November 2016 at a time when the NCR market was in the midst of a major slowdown. We sold over 6 lakh sq. ft. of villas with a booking value well in excess of Rs, 300 crore in a single day. For FY17, we managed to sell more than a million sq. ft. in this project with a booking value of Rs, 563 crore. We are proud of this achievement given that this was our first ever project in Noida and the launch was executed at a time when market conditions were very unsupportive. Godrej Greens in Pune also witnessed an overwhelming customer response despite being launched immediately after the government''s demonetization announcement. We sold 420,088 sq. ft. with a booking value ofRs, 187 crore inFY17at Godrej Greens.

On the operational front, we successfully delivered 4.55 million sq. ft. across four cities. We have now delivered over 15 million sq. ft. of real estate in the last four years which we believe demonstrates that our operational delivery is keeping pace with our sales acceleration over the past few years.

Sustainable development is an important part of our Company''s vision and we have received several recognitions for our leadership in environmental sustainability in FY17. GPL was ranked as the 2nd best developer in Asia and 5th best globally for its leadership in sustainable development by Global Real Estate Sustainability Benchmark Report (GRESB). Godrej One received LEED Platinum Rating for the office premises under the Commercial Interiors segment from the US Green Building Council (USGBC). This is one of the first such certifications in the country. GPL also received significant external recognition with a total of 60 awards being received in FY17.

5. FUTURE PROSPECTS AND OUTLOOK OF THE COMPANY:

A cyclical downturn combined with demonetization and the implementation of the Real Estate (Regulation and Development) Act, 2016 has created short-term uncertainty in the sector. However these same factors will lead to consolidation and improved governance in the sector, which in turn will drive improved consumer confidence. The combination of this improved consumer confidence with far improved affordability that is the result of rising incomes, stagnant prices and reduced interest rates will propel the sector in a very positive direction over the next several years. The infrastructure status accorded to affordable housing is a game changing move that will open up more institutional sources for developers to raise funds at a competitive price. This move will encourage leading developers to enter this segment. We expect 2017 to be a transition year but the years ahead are likely to be very exciting ones for real estate development in India. Our brand, national presence, demonstrated track record and capabilities put us in a strong position to disproportionately benefit from any improvement in the environment and will allow us to remain on a high growth trajectory in the years ahead.

We will continue to pursue new projects through joint development agreements with land owners. In addition, we have also diversified our execution model by undertaking projects as a Project Development Manager on a fee basis. Our mission is to seek superior long-term growth in shareholder value by maximizing returns through optimal financing and fiscal discipline. The Company''s primary growth focus shall be on 4 key markets of Mumbai, NCR, Bengaluru and Pune, while at the same time opportunistically pursuing other key markets. The residential investment platform will enable us to enter projects which require large upfront capital investment.

On the operational front, the company shall be focusing on quick launch turnaround times and swift execution and delivery of projects. The company will continue to improve its project execution capabilities across regions, strengthened through continuously improving internal processes and internal capability building. In addition, a customer centric approach to growth, operational efficiency, optimizing return on capital and developing crisis and risk management capabilities will continue to remain the Company''s focus areas.

6. DEPOSITORY SYSTEM:

Your Company''s equity shares are available for dematerialization through National Securities Depository Limited and Central Depository Services (India) Limited. As on March 31, 2017, 99.98 % of the equity shares of the Company were held in dematerialized form.

7. SCHEME OF AMALGAMATION OF HAPPY HIGHRISES LIMITED WITH THE COMPANY:

Happy High-rises Limited (“HHL”), a wholly owned subsidiary of the Company, was amalgamated with the Company in terms of the Scheme of Amalgamation (‘Scheme’) sanctioned by the National Company Law Tribunal vide its order dated March 29, 2017. The petition for the Scheme was originally filed by HHL with Hon''ble High Court of Judicature at Bombay for approval of the Scheme. Consequent to enforcement of provisions of Companies (Compromise, Arrangements and Amalgamations) Rules, 2016 relating to merger, arrangement etc. with effect from December 15, 2016, cases relating to merger/amalgamations pending immediately before such date before any High Court, stood transferred to the National Company Law Tribunal (Tribunal/NCLT).

Accordingly, the order for approving the said Scheme was passed by the National Company Law Tribunal, Mumbai Bench. The appointed date of the Scheme was May 01, 2016. The Scheme has came into effect from April 25, 2017.

8. EXTRACT OF ANNUAL RETURN:

The Extract of Annual Return as provided under Section 92(3) of the Companies Act, 2013 (the “Companies Act”) and as prescribed in Form No. MGT-9 of the Companies (Management and Administration) Rules, 2014, as amended from time to time, is appended as Annexure II to this Report.

9. NUMBER OF MEETINGS OF THE BOARD:

The Board met 4 (four) times in the financial year ended March 31, 2017 on May 05, 2016, August 09, 2016, November 09, 2016 and February 02, 2017.

10. DIRECTORS’ RESPONSIBILITY STATEMENT:

The Directors hereby confirm that:

i. In the preparation of the annual accounts for the financial year ended March 31, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures;

11. 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 as at March 31, 2017 and of the profit of the Company for the year ended on March 31,2017.

Hi. They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act and rules made there under, as amended, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv. They have prepared the annual accounts for financial year ended March 31, 2017ona ‘going concern'' basis.

v. They have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and have been operating efficiently.

vi. They have devised proper systems to ensure compliance with provisions of all applicable laws and that such systems were adequate and operating effectively.

11. DECLARATION BY INDEPENDENT DIRECTORS:

The Independent Directors of the Company have submitted the declaration of Independence as required under Section 149(7) of the Companies Act, confirming that they meet the criteria of independence under Section 149(6) of the Companies Act and Regulation 16(1)(b) of SEBI LODR Regulations.

12. POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION:

The policy of the Company on directors'' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided under Section 178(3) of the Companies Act, is appended as Annexure III to this Report.

13. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

The details of loans given, investments made, guarantees given and securities provided under Section 186 of the Companies Act, have been provided in the notes to the standalone financial statements.

14. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

All transactions entered into during the financial year 2016 2017 with Related Parties as defined under the Companies Act and SEBI LODR Regulations were in the ordinary course of business and on an arm''s length basis. During the year, the Company had not entered into any transaction referred to in Section 188 of the Companies Act, with related parties which could be considered material under SEBI LODR Regulations. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3) of the Companies Act in Form AOC-2 is not applicable. Attention of Members is drawn to the disclosures of transactions with related parties set out in Notes to Accounts - Note No 48 forming part of the Standalone financial statements.

As required under Regulation 23 of SEBI LODR Regulations, the Company has formulated a Related Party Transactions Policy which is available on the website of the Company at https:// www.aodreiproperties.com/investor/corporateaovernance.

15. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

There have been no material changes and commitments affecting the financial position of the Company which have occurred between March 31,2017 and the date of this Report, other than those disclosed in this Report.

16. PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

The particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 134(3)(m) of the Companies Act read with the Companies (Accounts) Rules, 2014 is appended as Annexure IV to this Report.

17. BUSINESS RISK MANAGEMENT:

The Company has constituted a Risk Management Committee consisting of key executives and an independent director to identify and assess business risks and opportunities. The Risk Management Committee identifies the risks at both enterprise level and at project level.

The business risks identified are reviewed by the Risk Management Committee and a detailed action plan to mitigate identified risks is drawn up and its implementation is monitored. The key risks and mitigation actions are then placed before the Audit Committee of the Company.

18. CORPORATE SOCIAL RESPONSIBILITY:

A Corporate Social Responsibility (CSR) Committee has been constituted in accordance with Section 135 of the Companies Act. The details required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 are given in CSR Report appended as Annexure V to this Report. The CSR Policy is available on the website of the Company at www. aodreiproperties.com/investors.

19. VIGIL MECHANISM:

The Company has established a vigil mechanism for directors, employees and other stakeholders to report their genuine concerns, details of which have been given in the Corporate Governance Report forming part of this Annual Report.

20. ANNUAL EVALUATION OF PERFORMANCE OF THE BOARD:

The Company conducted a formal Board Effectiveness Review as part of its efforts to evaluate, identify improvements and thus enhance the effectiveness of the Board of Directors (Board), its Committees and individual directors. This was in line with the requirements mentioned in the Companies Act and SEBI LODR Regulations.

The Corporate HR team of Godrej Industries Limited and Associate Companies (GILAC) worked directly with the Chairman and the Nomination and Remuneration Committee of the Board, to design and execute this process which was adopted by the Board. Each Board Member completed a confidential online questionnaire, providing vital feedback on how the Board currently operates and how it might improve its effectiveness.

The survey comprised of four sections and compiled feedback and suggestions on:

-Board processes (including Board composition, strategic orientation and team dynamics);

- Individual committees;

- Individual Board members; and

- Chairman''s Feedback Report

The following reports were created, as part of the evaluation:

- Board Feedback Report

- Individual Board Member Feedback Report

- Chairman''s Feedback Report

The overall Board Feedback Report was facilitated by Mr. Keki Dadiseth along with the Independent Directors. The Directors were vocal about the Board functioning effectively, but also identified areas which show scope for improvement. The Individual Committees and Board Members feedback was shared with the Chairman. Following his evaluation, a Chairman''s Feedback Report was also compiled.

21. SUBSIDIARY COMPANIES:

A. Subsidiaries

During the financial year under review, Godrej Vikhroli Properties India Limited (incorporated as a result of conversion of Godrej Vikhroli Properties LLP), Godrej Skyline Developers Private Limited, Godrej Residency Private Limited, Pearlite Real Properties Private Limited, Godrej Real View Developers Private Limited, were incorporated as wholly owned subsidiaries of the Company. Happy Highrises Limited, wholly owned subsidiary of the Company, entered into a share purchase agreement with Citystar Infraprojects Limited and its shareholders and in terms of the said agreement, acquired the entire share capital of Citystar Infraprojects Limited. Consequent upon merger of Happy Highrises Limited with the Company, Godrej Properties Limited has become the member of Citystar InfraProjects Limited.

As at March 31,2017, the Company had 20 subsidiaries under the Companies Act, namely, Godrej Realty Private Limited, Godrej Real Estate Private Limited, Godrej Buildcon Private Limited, Godrej Garden City Properties Private Limited, Godrej Projects Development Private Limited, Godrej Landmark Redevelopers Private Limited, Godrej Redevelopers (Mumbai) Private Limited, Godrej Green Homes Limited, Godrej Home Developers Private Limited, Godrej Hillside Properties Private Limited, Godrej Investment Advisers Private Limited, Godrej Prakriti Facilities Private Limited, Godrej Highrises Properties Private Limited, Godrej Fund Management Pte Ltd, Godrej Genesis Facilities Management Private Limited, Godrej Skyline Developers Private Limited, Godrej Residency Private Limited, Prakritiplaza Facilities Management Private Limited, Godrej Vikhroli Properties India Limited and Citystar Infraprojects Limited.

The Company shall provide a copy of the financial statements of its subsidiary companies to the members of the Company on their request. The financial statements of its subsidiary companies will also be kept open for inspection by any members at the registered office of the Company during business hours and will also be available on the website of the Company.

During the financial year under review, GRIP II Pte. Ltd, an investee company under the Godrej Residential Investment Program II, had entered into Share Subscription, Share Purchase and Shareholders'' Agreements with the Company in respect of Godrej Greenview Housing Private Limited (GGHPL), Wonder Projects Development Private Limited (WPDPL) and Godrej Real View Developers Private Limited (GRVDPL), pursuant to which the Company has sold 80% of the equity share capital of GGHPL, WPDPL and GRVDPL to GRIP II Pte. Ltd. Likewise, the Company also entered into a Share Subscription, Share Purchase and Shareholders'' Agreement with GRIP II Pte. Ltd. pursuant to which the Company has sold 51% of the equity share capital of Pearlite Real Properties Private Limited (‘PRPPL’) to GRIP II Pte. Ltd. Consequently, GGHPL, WPDPL, GRVDPL and PRPPL have ceased to be subsidiary of the Company.

As at March 31, 2017, Wonder Space Properties Private Limited, Wonder City Buildcon Private Limited, Godrej Home Constructions Private Limited, Godrej Greenview Housing Private Limited, Wonder Projects Development Private Limited, Godrej Real View Developers Private Limited, Pearlite Real Properties Private Limited and Godrej One Premises Management Private Limited are associate companies of the Company.

B. Limited Liability Partnerships (LLPs)

Your Company is a partner in the following LLPs as of March 31,2017:

1. Godrej Property Developers LLP

2. Mosiac Landmarks LLP

3. Dream World Landmarks LLP

4. Oxford Realty LLP

5. Godrej SSPDL Green Acres LLP

6. MS Ramaiah Ventures LLP

7. Oasis Landmarks LLP

8. Caroa Properties LLP

9. Amitis Developers LLP

10. Godrej Construction Projects LLP

11. Godrej Housing Projects LLP

12. GodrejLandDevelopersLLP

13. Godrej Developers & Properties LLP

14. GodreiHiahrisesRealtvLLP

15. Godrej Project Developers & Properties LLP

16. AR Landcraft LLP

17. GodrejHighviewLLP

18. PrakhhyatDwellingsLLP

19. GodrejSkyviewLLP

20. Bavdhan Realty @ Pune21 LLP 22. Godrej Projects (Pune) LLP

C. Material Non-Listed Indian Subsidiary:

As at March 31, 2017, Godrej Buildcon Private Limited, a wholly owned subsidiary of the Company was considered material non-listed Indian subsidiary under Regulation 24 of SEBI LODR Regulations and accordingly one Independent Director of the Company was also on the Board of Godrej Buildcon Private Limited.

22. PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES:

As required under SEBI LODR Regulations and Section 129 of the Companies Act, the consolidated financial statements have been prepared by the Company in accordance with the applicable accounting standards and form part of the Annual Report. A statement containing the salient features of the Financial Statements of the subsidiaries, joint ventures and associate companies of the Company in Form AOC-1 as required under Rule 5 of the Companies (Accounts) Rules, 2014 form part of the notes to the financial statements.

23. DETAILS RELATING TO DEPOSITS COVERED UNDER CHAPTER V OF THE COMPANIES ACT, 2013:

Sr.

No.

Particulars

Amount in Rupees

1

Accepted during the year

0

2

Remained unpaid or unclaimed as at the end of the year

12,883,000

3

Whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved:-

0

(i) at the beginning of the year

0

(ii) maximum during the year

0

(iii) at the end of the year

0

4

details of deposits which are not in compliance with the requirements of Chapter V of the Companies Act

0

The Company has not accepted any deposits from its Directors.

24. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:

There are no significant and material orders passed by the regulators/courts/tribunals which would impact the going concern status of the Company and its future operations.

25. INTERNAL FINANCIAL CONTROL SYSTEM:

The Company has an internal financial control system commensurate with the size, scale and complexity of its operations. The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the businesses and functions are systematically addressed through mitigating action on continuing basis. These are routinely tested and certified by Statutory as well as Internal Auditors. The audit observations on internal financial controls are periodically reported to the Audit Committee.

26. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

Mr. Adi B. Godrej, Chairman, stepped down from the Board of the Company with effect from April 01, 2017, with an intent to move away from active participation in the day to day functioning of the Company. He will however, continue to provide high level support in the capacity of Chairman Emeritus. The Board placed on record its appreciation for the valuable services rendered by Mr. Adi B. Godrej to the Company during his tenure as Chairman. Consequent to the said change, Mr. Pirojsha Godrej has been re-designated as Executive Chairman of the Company with effect from April 01, 2017 and Mr. Mohit Malhotra has been re-designated as Managing Director & Chief Executive Officer of the Company with effect from April 01, 2017.

On October 10, 2016, Ms. Parmeshwar A. Godrej, Non Executive Director of the Company, passed away. The Board while recording its heart-felt condolence at the demise of Ms. Parmeshwar A. Godrej, appreciated the contributions made by her towards the growth of the Company from its formative period.

In accordance with the Articles of Association of the Company and the provisions of the Section 152(6)(e) of the Companies Act, Mr. Pirojsha Godrej (DIN: 00432983) will retire by rotation at the ensuing Annual General Meeting and being eligible, offered himself for re-ao Dointment.

Mr. Pirojsha Godrej (DIN: 00432983) - Executive Chairman, Mr. Mohit Malhotra (DIN: 07074531) - Managing Director and Chief Executive Officer, Mr. Rajendra Khetawat -Chief Financial Officer and Mr. Surender Varma - Company Secretary & Chief Legal Officer are the Key Managerial Personnel of the Company as at the date of this Report. Pursuant to the approval of the members accorded at the Annual General Meeting held on August 09,2016, the Company had made the applications to the Central Government for waiver of recovery of excess remuneration paid to Mr. Pirojsha Godrej and Mr. Mohit Malhotra for financial year 2015-16 and to Mr. K T Jithendran for the period April

01, 2015 to December 15, 2015. The Central Government has granted approval for waiver for recovery of excess remuneration paid to Mr. K T Jithendran and directed to recover '' 15.72 lakh out of excess remuneration of '' 2.68 crore paid to Mr. Pirojsha Godrej. The Company has taken necessary steps to recover the amount of '' 15.72 lakh from Mr. Pirojsha Godrej. The approval in respect of application of Mr. Mohit Malhotra is awaited.

27. AUDITORS’ APPOINTMENT:

The Members of the Company at the 29th Annual General Meeting had appointed Kalyaniwalla & Mistry LLP, Chartered Accountants, (Firm Registration no.:104607W/W100166) as the Statutory Auditors of the Company, to hold office from the conclusion of 29th Annual General Meeting of the Company until the conclusion of the 32nd Annual General Meeting.

As per the provisions of the Companies Act, no listed company shall appoint an audit firm as auditors for more than two terms of five consecutive years. The Companies Act also provided for additional transition period of three years from the commencement of the Act i.e. 1st April, 2014. Accordingly, the term of the present Auditors, Kalyaniwalla & Mistry LLP expires at the conclusion of the forthcoming Annual General Meeting. The Board has recommended BSR & Co. LLP, Chartered Accountants, Firm Registration No. 101248W/W-100022, Mumbai as the Company''s new Statutory Auditors for a period of five years commencing from the conclusion of Thirty Second Annual General Meeting till the conclusion of the Thirty Seventh Annual General Meeting. BSR & Co. LLP, Chartered Accountants have confirmed that their appointment, if made, would be within the limits specified under Section 141(3)(g) of the Companies Act and that they are not disqualified to be appointed as statutory auditor in terms of the provisions of Section 139(1), Section 141(2) and Section 141(3) of the Companies Act and the provisions of the Companies (Audit and Auditors) Rules, 2014. The Board of Directors recommends to the Members the appointment of

BSR & Co. LLP, Chartered Accountants as Statutory Auditors of the Company.

There are no qualifications, reservations or adverse remarks or disclaimers made by Kalyaniwalla & Mistry, Statutory Auditors, in their report.

28. COST AUDITORS:

The Board of Directors of the Company, on recommendation of Audit Committee, appointed M/s. R Nanabhoy & Co, Cost Accountants, as Cost Auditors of the Company for the financial year 2017-18 at a fee of Rs, 1,05,000 (Rupees One Lakh Five Thousand only) plus applicable taxes and out of pocket expenses subject to the ratification of the said fees by the Members at the ensuing Annual General Meeting pursuant to Section 148 of the Companies Act.

The cost audit report would be filed with the Central Government within prescribed timelines.

29. SECRETARIAL AUDIT REPORT:

The Board of Directors of the Company have appointed A K Jain & Co., Practicing Company Secretary, to conduct the Secretarial Audit and his Report on Company''s Secretarial Audit is appended to this Report as Annexure VI.

There are no qualifications, reservations or adverse remarks or disclaimers made by A. K. Jain & Co., Company Secretary in practice, in their Secretarial Audit Report.

30. FRAUD REPORTING:

There have been no instances of fraud reported by the Auditors under Section 143(12) of the Companies Act and Rules framed there under either to the Company or to the Central Government.

31. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

The Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34(2) of SEBI LODR Regulations, is appended to this Report.

32. CORPORATE GOVERNANCE:

Your Company is committed to maintaining the highest standards of Corporate Governance and adhering to the corporate governance requirements as set out by Securities and Exchange Board of India. The Report on Corporate Governance as stipulated under SEBI LODR Regulations forms part of the Annual Report. The Certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance as stipulated under Schedule V to SEBI LODR Regulations and applicable provisions of the Companies Act forms part of the Corporate Governance Report.

33. AUDIT COMMITTEE OF THE COMPANY:

Your Company''s Audit Committee comprises the following 7 (seven) Independent Directors, viz. Mr. Keki B. Dadiseth (Chairman), Mrs. Lalita D. Gupte, Mr. Amit B. Choudhury, Mr. Pranay D. Vakil, Dr. Pritam Singh, Mr. S. Narayan and Mr. Amitava Mukherjee.

The composition of the Audit Committee is in compliance with the requirements of Section 177 of the Companies Act and Regulation 18 of SEBI LODR Regulations.

34. PARTICULARS OF EMPLOYEES:

Disclosures with respect to the remuneration of Directors and employees as required under Section 197 of the Companies Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been appended as Annexure VII to this Report. The information required pursuant to Section 197 of the Companies Act read with Rule 5(2)&(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is available for inspection by the Members at registered office of the Company during business hours on working days 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, whereupon a copy would be sent.

35. EMPLOYEES STOCK OPTION SCHEMES:

As required in terms of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, the disclosure relating to Godrej Properties Limited Employee Stock Grant Scheme, 2011 (“GPL ESGS”) is appended as Annexure VIII to this Report.

In view of the global meltdown and lower market prices of the shares of the Company and with a view to protect the interest of the employees of the Company to whom options under Godrej Properties Limited Employee Stock Option Plan (GPL ESOP) have been vested, the exercise period for the vested options was extended to December 27, 2016 with the prior approval of Members. However, none of the employees had exercised their options till December 27, 2016, being the last date of exercise period. Accordingly, the Board terminated the GPL ESOP and all the unexercised 2,41,400 options under the GPL ESOP were rendered lapsed. The lapsed and inappropriate equity shares held by the Trustees of GPL ESOP Trust on the date of termination have been sold on the recognized stock exchanges.

36. BUSINESS RESPONSIBILITY REPORT:

The Business Responsibility Report for the financial year ended March 31, 2017 as stipulated under Regulation 34(2) of SEBI LODR Regulations is attached as part of the Annual Report.

37. AWARDS & RECOGNITIONS:

The Directors take pleasure in informing the Members that the Company, its people and projects were acknowledged with several awards and ratings during the financial year ended March 31, 2017. The details of the award received are given at page no. 8 of this Report.

38. ACKNOWLEDGMENTS:

The Directors wish to place on record their appreciation and sincere thanks to the customers, joint venture partners, shareholders, banks, financial institutions, fixed deposit holders, vendors and other associates, who through their continued support and cooperation, have helped, as partners, in the Company''s progress. The Directors also acknowledge the hard work, dedication and commitment of the employees.

For and on behalf of the Board of Directors of Godrej Properties Limited

Pirojsha Godrej

Place: Mumbai Executive Chairman

Date : May 04, 2017 (DIN: 00432983)


Mar 31, 2014

TO THE SHAREHOLDERS

The Directors have pleasure in presenting the 29th Directors'' Report of your Company along with the audited accounts for the financial year ended March 31, 2014.

1. OPERATING RESULTS:

Certain key aspects of your Company''s performance (on a standalone basis) during the financial year ended March 31, 2014, as compared to the previous financial year are summarised below:

Finanacial year 2013-2014 Financial year 2013-2014

Profit before Taxation 9,621.37 13,960.52

Tax Expenses 143.80 (1,693.74)

Profit after Taxation 9,765.17 12,266.78

Add: Surplus brought forward 25,346.28 25,682.80

Less: Utilised during the year (Refer Note no. 27 of Financial Statement) 26,370.49 7,719.53

AMOUNT AVAILABLE FOR APPROPRIATION 8,740.96 30,230.05

Appropriations:

Your Directors recommend appropriations as under:

Proposed Dividend 3,986.95 3,123.01

Dividend Distribution Tax 677.58 530.76

Transfer to General Reserve 980.00 1230.00

Surplus carried forward 3,096.43 25,346.28

TOTAL APPROPRIATIONS 8,740.96 30,230.05

2. DIVIDEND:

Your Directors recommend for approval of the Members at the ensuing Annual General Meeting for payment of final dividend of" 21- per equity share (40%) of nominal value of" 5/- each for the financial year ended March 31, 2014 (previous year" 4.00 per equity share of nominal value of" 10 each). The dividend will be paid in compliance with the applicable rules and regulations.

3. RIGHTS ISSUE OF EQUITY SHARES:

During the year under review, your Company issued and allotted 21,538,388 equity shares of ~10/- each at a premium of " 315/- per equity share, aggregating to " 699.998 crore to the existing equity shareholders of the Company on a rights basis (the "Rights Issue"). The equity shares allotted pursuant to the Rights Issue were admitted tor listing and trading on BSE Limited and the National Stock Exchange ot India Limited with effect from September 24, 2013. Your Company shall use the proceeds of the Rights Issue towards prepayment and repayment of existing debt of your Company and its subsidiaries and general corporate purposes.

Your Directors take this opportunity to thank all the shareholders for their overwhelming response and for the confidence reposed by them in the Company.

4. SUB-DIVISION OF EQUITY SHARES AND ALTERATION OF THE MEMORANDUM AND ARTICLES OF ASSOCIATION:

In accordance with the approval of the shareholders of the Company through postal ballot, the results of which were announced on November 11, 2013, the equity share of nominal value of" 10/- (Rupees Ten only) of the Company was sub-divided into 2 (two) equity shares of nominal value of " 5/- (Rupees Five only) each on and from November 22, 2013; and the Memorandum of Association and the Articles of Association of the Company were altered pursuant to the sub-division of the equity shares of the Company.

The shareholders with equity shares of nominal value of " 10/- each of the Company in electronic form received direct credit of sub-divided equity shares of nominal value of " 5/- each of the Company to their dematerialised account with the depository. The Company issued a new composite share certificate for equity share of nominal value of ~5 each in place of the old share certificate for shareholders holding equity shares in physical form.

5. OVERVIEW OF OPERATIONS:

Your Company posted a total income of" 766.56 crore during the year ended March 31, 2014.

Despite the current uncertainties and challenges in the real estate environment, your Company has successfully

demonstrated strong value addition to its development portfolio. In the current fiscal year, your Company has signed 8 new projects adding 13 million sq. ft. of saleable area to its portfolio. The new projects signed are located in Mumbai, the National Capital Region, Pune, Bangalore and Chennai. The projects added are all of substantial size and are in line with your company''s long term strategy of focusing on value accretive and risk efficient models.

While real estate supply continues to outpace growth in demand across most cities in the country, your Company achieved its highest ever quarterly sales in the fourth quarter of the fiscal year, driven by successful new launches in Mumbai and Bengaluru.

Your Company launched new projects and phases totalling over 2.82 million square feet in the fiscal year. The highlight of the year was the successful launch of Godrej Central, your Company''s first redevelopment project, which registered bookings of over 200 apartments valued at over Rs 400 crore on the day of its launch. Another milestone for your Company was the launch of Godrej United in Bengaluru. The launch was achieved within 12 months of the project being added to your Company''s portfolio. Godrej United also witnessed strong uptake in the market, registering sales worth over Rs 100 crore over the span of a few weeks.

With the current challenges facing the Indian economy dampening commercial real estate sales across major cities in the country, your Company registered significant sales in the commercial space, registering sales of close to 800,000 square feet across three projects in Mumbai and Kolkata.

Delivering on its customer commitments, your Company handed over 624 apartments across 13 towers in Godrej Garden City, your Company''s first township project. The Global Indian International School at Godrej Garden City, Ahmedabad was also inaugurated in the fiscal year. This is the first school that your Company has built and marks an important milestone for the township.

Your company continues to deliver on its vision of being the most trusted name in the real estate industry, and has been recognized as such, winning the ''Best Business Practice in Real Estate'' at the National Real Estate Award for Excellence in Real Estate for the year 2012 and the ''Ethical Brand for Real Estate'' award by CMO Asia. Your company has intensified its efforts with regards to its customer-centric initiatives, and is continuously incorporating customer feedback in design and specifications, across all its projects. Your Company has made good progress in its customer management and marketing abilities through numerous targeted customer engagement programs and innovative digital campaigns.

Your Company has taken strides towards making itself a design led organization. Your Company continues to build capabilities in its design team and endeavors to work with the best talent, worldwide. Your company''s focus of creating extraordinary and imaginative spaces has been recognized internationally - with The Trees'' winning an ''Honor Award'' from the Boston Society of Landscape Architects in the current fiscal year.

Your Company also continues its focus to deliver on its commitments on the sustainability front, aiming for green building certifications for all ongoing and future projects. In the current fiscal year, Godrej BKC received a LEED Platinum Pre-Certification; it is the first building in the prestigious Bandra Kurla Complex in Mumbai that has received the certification. Your company also received the ''Sustainability Award'' from the Cll for its contribution to green building mission at the GreenCo Summit 2013.

Your company and its projects received 25 awards in the year at the entity and project levels including the ''Best Emerging Developer'' at the NDTV Property Awards 2013, the ''Brand Excellence Award'' at the Brand Excellence Summit 2013, the ''Master Brand 2013'' at the World Brand Congress Summit and the ''Developer of the Year'' at the Indian Realty Awards 2013.

In recognition of your Company''s endeavor to maintain outstanding employee practices and encourage a collaborative work environment, your Company was ranked amongst India''s Top 25 Companies to Work for in 2013: Ranked #25 in the overall category and Ranked #1 in the Real Estate and Construction Sector in a study conducted by the Great Places to Work Institute and the Economic Times.

6. FUTURE PROSPECTS AND OUTLOOK OF THE COMPANY:

With the real estate markets and customer sentiments closely correlated to the overall growth in the Indian economy, your Company expects that the real estate industry would continue to remain under pressure for the next fiscal year. However, your Company is committed to meet and exceed the expectations of all its stakeholders.

In order to achieve the same, your Company shall continue to build scale through capital efficient business models such as sourcing land under the joint development model and the development manager model. The Company''s primary areas of focus for new business development shall be major cities of Mumbai, NCR and Bengaluru while at the same time opportunistically pursuing other key markets. The Company s business development strategy shall be aligned towards less capital intensive Profit Sharing and Development Manager models. Additionally, your Company will focus on sourcing land with large capital requirements in our target geographies under the Residential Co-investment platform with your Company acting as the development manager for these projects and sharing in the equity profits as well. On the operational front, timeliness of launches and execution shall continue to be a strong focus area for your company. Your Company will continue to improve its project execution capabilities across regions, strengthened through strategic partnerships with leading construction firms. Other focus areas for your company shall be optimizing return on capital and developing crisis and risk management capabilities.

7. FIXED DEPOSITS:

During the financial year ended March 31, 2014, fixed deposits aggregating to " 628.3 Lacs have been mobilised. The Company has no overdue deposits other than unclaimed deposits. Broadly, Section 73 to 76 ot the Companies Act, 2013 (the "2013 Act") provide that the Company may accept deposits from members and/ or public on passing the resolution in General Meeting ot the members of the Company. The Company will start accepting deposits after complying with the provisions of Section 73 to 76 of the 2013 Act and the Companies (Acceptance of Deposits) Rules, 2014.

8. DEPOSITORY SYSTEM:

Your Company''s equity shares are available for dematerialisation through National Securities Depository Limited and Central Depository Services (India) Limited. As on March 31, 2014, 99.97 % of the equity shares of your Company were held in dematerialised form.

9. CORPORATE GOVERNANCE:

As required by Clause 49 of the Listing Agreements entered into by your Company with BSE Limited and the National Stock Exchange of India Limited, a detailed Report on Corporate Governance together with a report on Management Discussion and Analysis is included in the Annual Report. The Auditors have certified the Company''s compliance with the requirements of Corporate Governance in terms of Existing Clause 49 of the Listing Agreement and the same is annexed to the Report on Corporate Governance. Kindly note that the Securities and Exchange Board of India has, vide, its circular dated April 17, 2014 (the "Amendment"), notified various amendments to Existing Clause 49 of the Listing Agreement to align it with the requirements under the 2013 Act. The Amendment is applicable to all listed companies with effect from October 1, 2014 and accordingly, the reference to ''Existing Clause 49'' herein as well as in the report on Corporate Governance or any other report or document for the financial year 2013- 2014 would mean Clause 49 of the Listing Agreement without any reference to the Amendment

10. AWARDS & RECOGNITIONS:

Your Directors take pleasure in informing you that your Company, its people and projects were acknowledged with the following awards and ratings during the financial year ended March 31, 2014:

Year Key Achievements

2013 Won ''Best Upcoming Township Award'' for Godrej Anandam, Nagpur at the Realty Kings Awards by My FM, Dainik Bhaskar and CREDAI Nagpur 2013 GPL won the "Best Business Practice in Real Estate" at the National Real Estate Award for Excellence in Real Estate for the year 2012 by Accommodation Times

2013 Mr. Girish Shah won the ''Thought Leaders Award''

2013 GPL won the following awards at the ''Real Estate Awards'' by ET NOW

- Popular Choice-Developer of the Year - Residential Category

- Integrated Township of the year - Godrej Garden City

- Popular Choice - Innovative Real Estate Marketing Campaign

- Mr. Girish Shah won ''Most Talented CMOs'' in the real estate sector

2013 Godrej Anandam, Nagpur, won the ''Best

Developer Award'' (Rest of Maharashtra) at the

Vasturaviraj Vishwakarma Real Estate Awards 2013 Godrej Properties won ''Best Emerging

Developer'' Award at the NDTV Property Awards 2013 Godrej Properties eceives sustainability award from Cll at the GreenCo Summit 2013 Godrej Garden City (AHS) received the ''Best Marketing Campaign'' Award at Paul Writer''s Great India Marketing Summit 2013 GPL won ''Brand Leadership Award'' in the real estate sector at the Brand Leadership Awards 2013 Godrej Platinum'' won an award for ''Luxury Project of the Year'', North Bangalore at the Bangalore Real Estate Awards 2013 2013 Godrej Properties was voted amongst India''s Top 10 (Innovative) Builders at the Construction World Architect and Builder (CWAB) Awards 2013 2013 Mr. Pirojsha Godrej won ''Real Estate Person of the Year'' award at the Construction Week Awards 2013 2013 Godrej Properties won ''Real Estate Company of the Year'' Runner up award at the Construction Week Awards 2013 2013 Godrej Properties won ''Developer of the Year'' award at the Indian Realty Awards 2013 2013 Godrej Properties won Brand Excellence Award'' at the Brand Excellence Awards 2013 2013 Godrej Properties won ''Master Brand 2013'' at the World Brand Congress Summit 2013 Mr. Pirojsha Godrej was selected as ''Person ot the year - 2013'' at the Sixth GIREM Leadership Awards 2013 Godrej Palm Grove won ''Best mid range housing project of the year'' award at the Chennai Real Estate Awards 2013 2013 ''Diamond EDGE Winner'' for ''Customer Experience Transformation'' - InformationWeek 2013 Godrej Properties won "Outstanding

Contribution in Real Estate (Residential Project)" award at the EPC World Awards 2013

2013 Godrej Garden City won Affordable housing project for the year - West India'' at the 6th ESTATE AWARDS

2013-WEST India Edition

2013 Godrej Properties won "Real Estate Developer of The Year (Maharashtra)" award at the Brands Academy Real Estate Awards

2013 Godrej Frontier won the ''Best 50 % Complete Residential Project'' under Luxury Segment in NCR Region at the CNBC AWAAZ Real Estate Awards 2013

2014 Godrej Anandam, Nagpur received a 6 Star rating from CRISIL

2014 Godrej Platinum, Kolkata received a 6 Star rating from CRISIL

2014 Godrej Garden City, Ahmedabad, received ''The Best innovative Marketing Campaign'' at the Golden Mikes Award for the campaign carried out during the Navratri period

2014 Ethical Brand For Real Estate by CMO Asia

2014 Most Admired Retail Website by Asia Retail Congress

2014 Gold in the category of Online Newsletter for Vibrations by Public Relations Council of India (PRCI)

2014 Silver in the category of In-House Magazine for Storey Times by PRCI

2014 ''The Trees'' won the international Honour Award from the Boston Society of Landscape Architects

2014 Godrej Platinum won the award for ''Best upcoming project in Bengal'' in the CREDAI Bengal Realty Awards 2014

11. EMPLOYEES STOCK OPTION SCHEME:

As required in terms of the Securities and Exchange Board of India (Employees Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, as amended, the disclosure relating to Godrej Properties Limited Employee Stock Option Plan ("GPL ESOP"), Godrej Properties Limited Employee Stock Grant Scheme, 2011 ("GPL ESGS") is given in Annexure (Part I) and Annexure A (Part II), respectively.

12. SCHEME OF AMALGAMATIONS:

During the financial year under review, the following Schemes of Amalgamation were approved by the Hon''ble Bombay High Court:

1. Godrej Estate Developers Limited was amalgamated with Godrej Sea View Properties Limited in terms of the Scheme of Amalgamation (the ''Scheme'') sanctioned by the Hon''ble Bombay High Court vide its order dated March 7, 2014. The appointed date of the Scheme was December 31, 2013.

2. Godrej Sea View Properties Limited and Godrej Nandhi Hills Project Private Limited were amalgamated with your Company in terms of the Scheme of Amalgamation (the ''Scheme'') sanctioned by the Hon''ble Bombay High Court vide its order dated April 11, 2014. The appointed date of the Scheme was January 1, 2014.

3. Godrej Developers Private Limited was amalgamated with Godrej Projects Development Private Limited in terms of the Scheme of Amalgamation (the ''Scheme'') sanctioned by the Hon''ble Bombay High Court vide its order dated April 29, 2014. The appointed date of the Scheme was April 1, 2013.

13. SUBSIDIARY COMPANIES:

A. Subsidiaries'' Accounts

During the financial year under review, Wonder City Buildcon Private Limited and Godrej Green Homes Limited were incorporated as wholly owned subsidiaries of your Company.

As at March 31, 2014, your Company had 12 subsidiaries (direct and indirect), namely, Godrej Realty Private Limited, Godrej Real Estate Private Limited, Happy Highrises Limited, Godrej Premium Builders Private Limited, Godrej Buildcon Private Limited, Godrej Garden City Properties Private Limited, Godrej Projects Development Private Limited, Godrej Buildwell Private Limited, Godrej Landmark Redevelopers Private Limited, Godrej Redevelopers (Mumbai) Private Limited, Wonder City Buildcon Private Limited and Godrej Green Homes Limited.

Pursuant to the General Circular No. 2/2011 dated February 8, 2011 issued by the Ministry of Corporate Affairs, Government of India, the Board of Directors of your Company have given their consent for not attaching the accounts of all the subsidiaries of your Company along with the Annual Report of your Company. In line with the above circular and as per the Accounting Standard 21 (AS 21) issued by the Institute of Chartered Accountants of India, the Audited Consolidated Financial Statements of your Company along with the Auditors'' Report have been annexed to this Annual Report.

The Company shall provide the copy of the annual accounts of its subsidiary companies and the related information to the members of the Company and also to the members of the subsidiary companies on their request. The annual accounts of the subsidiary companies will also be kept open for inspection by any members at the Registered Office of the Company and also at the Registered Office of the respective subsidiary companies during business hours.

During the financial year under review, Godrej Projects Development Private Limited (''GPDPL''), a wholly owned subsidiary company of your Company, entered into agreements with Shubh Properties Cooperatief U. A, and others (the Investors''), for transfer of 49% of the equity share capital of Godrej Redevelopers (Mumbai) Private Limited to the Investors.

During the year under review, pursuant to the agreements entered into by your Company with Shubh Properties Cooperatief U. A, and others (the Investors''), your Company has transferred 74.9% of the equity share capital of Wonder Space Properties Private Limited WSPPL) to the Investors. WSPPL has ceased to be

a subsidiary of the Company post transfer of equity shares by the Company.

B. Limited Liability Partnerships (LLPs)

Your Company is a partner in the following LLPs as of March 31, 2014:

1. Godrej Buildcorp LLP.

2. Godrej Property Developers LLP for the project located at Thane (Mumbai).

3. Godrej Vikhroli Properties LLP for the project located at Vikhroli.

4. Mosiac Landmarks LLP for the project located at Undri, Pune.

5. Dream World Landmarks LLP for the project located at Undri Pune

6. Oxford Realty LLP for project located at Keshavnagar, Mundhwa, Pune.

7. SSPDL Green Acres LLP for project located at Chennai

Your Company has also been admitted as a partner in M.S. Ramaiah Ventures LLP forthe project at Devanhalli, Bengaluru and Caroa Properties LLP for the project at Panvel.

C. Material Non-Listed Indian Subsidiary

Pursuant to the Existing Clause 49 of the Listing Agreement, if the turnover or net worth (i.e. paid up capital and free reserves) of any unlisted Indian subsidiary company exceeds 20% of the consolidated turnover or net worth respectively of the listed holding company and its subsidiaries in the immediately preceding accounting year; that subsidiary is termed as a ''Material Non-Listed Indian Subsidiary''. There is no material non- listed Indian subsidiary ot your Company tor the financial year 2013-2014.

14. DIRECTORS:

In accordance with the Articles of Association of the Company and the provisions of the Section 152(6) (e) of the 2013 Act, Mr. Adi B. Godrej and Mr. Nadir B. Godrej will retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. Mr. Srinivasan will be appointed as a director liable to retire by rotation in partial modification to resolution no. 8 passed at the 27th Annual General Meeting of the Company held on July 28, 2012.

The Company had, pursuant to the provisions of the clause 49 of the Listing Agreements entered into with Stock Exchange, appointment Mr. Keki B. Dadiseth, Mrs. Lalita D. Gupte, Mr. Pranay Vakil, Dr. Pritam Singh, Mr. Amit Choudhary, Mr. S. Narayan and Mr. Amitava Mukherjee as Independent Directors of the Company. As per section 149(4) of the Companies Act, 2013 (Act), which came into effect from April 1, 2014, every listed public company is required to have at least one- third of the total number of directors as Independent Directors. In accordance with the provisions 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 (AGM) of the Company.

15. APPOINTMENT OF AUDITORS:

M/s. Kalyaniwalla & Mistry, Chartered Accountants, who are the statutory auditors of the Company, hold office till the conclusion of the forthcoming AGM and are eligible for re-appointment. Pursuant to the provisions of section 139 of the Companies Act, 2013 and the Rules framed thereunder, it is proposed to appoint M/s. Kalyaniwalla & Mistry as statutory auditors of the Company from the conclusion of the forthcoming AGM till the conclusion of the thirty second AGM to be in the year 2017, subject to ratification of their appointment at every AGM.

Your Company has received a letter from M/s. Kalyaniwalla & Mistry to the effect that their re- appointment, if made, would be under the second and third proviso to Section 139 (1) of the 2013 Act and that they are not disqualified within the meaning of Section 141 of the 2013 Act read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014.

17. COST COMPLIANCE REPORT

The Company has filed the Cost Compliance Report for the year 2012-13.

18. BUSINESS RISK MANAGEMENT

Your Company has constituted a committee consisting of key executives of your Company and an independent director to identify and assess business risks and opportunities (''Risk Committee''). The Risk Committee identifies the risks at both enterprise level and at project level.

The business risks identified are reviewed by the Risk Committee and a detailed action plan to mitigate identified risks is drawn up and its implementation monitored.

19. ADDITIONAL INFORMATION

The Ministry of Corporate Affairs (MCA) has vide its General Circular No. 08/2014 dated April 4, 2014, clarified that the financial statements (and documents required to be attached thereto), auditors report and Board report in respect of financial years that commenced earlier than April 1, 2014 shall be governed by the relevant provisions/ Schedules/ rules of the Companies Act, 1956 (''1956 Act''). In view of this, the following information has been provided as per the provisions of the 1956 Act.

a) In terms of the provisions of Section 219(1)(b)(iv) of the 1956 Act, the Director''s Report and Annual Accounts are being sent to all members of the Company, excluding the statement of particulars of the employee under Section 217(2A) of the 1956 Act. In accordance with the provisions of Section 217(2A) of the 1956 Act and the rules framed there under i.e. the Companies (Particulars of

Employees) Rules, 1975, as amended, the names and other particulars of employees as required to be set out in the annexure to the Director''s Report is available for inspection at the Registered Office of the Company. Any member interested in obtaining a copy of the same may write to the Company Secretary at the Registered Office of the Company.

b) Information in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1 )(e) of the 1956 Act read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is given in Annexure B.

c) Your Company has devised proper systems to ensure compliance with all applicable laws.

20. GREEN INITIATIVES IN CORPORATE GOVERNANCE

The MCA has permitted companies to send electronic copies of Annual Report, notices etc., to the e-mail ids of shareholders. We have accordingly arranged to send the soft copies of these documents to the e-mail addresses of the Members, where such details are available with the depositories or the Registrar and Share Transfer Agent of your Company, M/s Karvy Computershare Private Limited. In case any of the shareholders would like to receive physical copies of these documents, the same shall be forwarded on written request to the Registrars and Share Transfer Agents of your Company, M/s. Karvy Computershare Private Limited.

21. DIRECTORS'' RESPONSIBILITY STATEMENT:

The MCA has vide its General Circular No. 08/2014 dated April 4, 2014, clarified that the financial statements (and documents required to be attached thereto), auditors report and Board report in respect of financial years that commenced earlier than April 1, 2014 shall be governed by the relevant provisions/ Schedules/ rules of the 1956 Act. In view of this, the following information has been provided as per the provisions of the 1956 Act.

Pursuant to Section 217(2AA) of the 1956 Act, your Directors, based on the representation received from the Management and after due enquiry, confirm for the financial year ended March 31, 2014:

(i) that in the preparation of the annual accounts, the applicable accounting standards have been followed and no material departures have been made from the same;

(ii) 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 year ended March 31, 2014 and of the profits of the Company for that year;

(Hi) that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the 1956 Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

22. ACKNOWLEDGEMENT:

Your Directors wish to place on record their appreciation and sincere thanks to the state government, government agencies, banks, financial institutions, joint venture partners, customers, shareholders, fixed deposit holders, vendors and other related organisations, who through their continued support and co-operation, have helped, as partners, in your Company''s progress. Your Directors also acknowledge the hard work, dedication and commitment of the employees.

For and on behalf of the Board of Directors of Godrej Properties Limited

Place : Mumbai Adi B. Godrej

Date : May 2, 2014 Chairman


Mar 31, 2013

TO THE SHAREHOLDERS

The Directors have pleasure in presenting the 28th Directors'' Report of your Company along with the audited accounts for the financial year ended March 31, 2013.

1 OPERATING RESULTS:

Certain key aspects of your Company''s performance during the financial year ended March 31, 2013, as compared to the previous financial year are summarised below:

Financial year Financial year 2012 - 2013 2011 - 2012 (Rs. in Lacs) (Rs. in Lacs)

Profit before Taxation 13,960.52 10,439.95

Tax Expenses (1,693.74) (2,303.48)

Profit after Taxation 12,266.78 8,136.47

Add: Surplus brought forward 25,682.80 21,087.59

Less: Utilised during the year (Refer Note no. 27 of Financial Statement) 7,719.53

AMOUNT AVAILABLE FOR APPROPRIATION 30,230.05 29,224.06 Appropriations:

Your Directors recommend appropriations as under:

Proposed Dividend 3,123.01 2,341.42

Dividend Distribution Tax 530.76 379.84

Transfer to General Reserve 1,230.00 820.00

Surplus carried forward 25,346.28 25,682.80

TOTAL APPROPRIATIONS 30,230.05 29,224.06

2. DIVIDEND:

Your Directors recommend for approval of the Members at the ensuing Annual General Meeting payment of final dividend of Rs. 4/- per equity share of Rs. 10/- each (40%) for the financial year ended March 31, 2013 (previous year Rs. 3.00 per equity share of Rs. 10 each). The dividend will be paid in compliance with the applicable regulations.

3. RIGHTS ISSUE OF SHARES:

Your Directors have approved raising funds by issue of equity shares of the face value of Rs. 10/- each of the Company to the existing equity shareholders of the Company on a rights basis (" Rights Issue" ) aggregating upto Rs. 700 Crores, subject to all applicable statutory and regulatory approvals. The terms and conditions of the Rights Issue, including the rights entitlement ratio, the issue price, issue size, record date, timing of the issue and other matters shall be decided by a Committee of Board constituted for this purpose (Rights Issue Committee) in consultation with the lead manager to the Rights Issue.

4. SUBDIVISION OF EQUITY SHARES:

The Company had sought approval of the members, by its notice of postal ballot dated March 23, 2013, for sub- division of each equity share of the Company of nominal value of Rs. 10/- to 2 (Two) equity shares of nominal value of Rs. 5/-, and the consequent division of the authorised capital of the Company of Rs. 100,00,00,000 into 20,00,00,000 equity shares of Rs. 5/- each.

In terms of the Scheme of amalgamation of Godrej Waterside Properties Private Limited (GWPPL), a wholly-

owned subsidiary of the Company, with the Company, the authorised share capital of GWPPL of Rs. 17,00,00,000 has been combined with the authorised share capital of the Company of Rs. 100,00,00,000, and the resultant authorised share capital of Rs. 117,00,00,000 is divided into 11,70,00,000 equity shares of Rs. 10/- each.

It has become impossible to give effect to the amendments and consequently the approval of the shareholders through Postal Ballot for the Sub-division and the amendments cannot be given effect to. The Board of Directors has on May 9, 2013, approved the sub-division of Authorised Capital of Rs. 117,00,00,000 comprising of equity shares of Rs. 10/- each into 23,40,00,000 (Twenty Three Crore Forty Lakh) equity shares of Rs. 5/- (Rupees Five only) each, which was earlier approved by the Board on March 23, 2013, but could not be given effect to for reasons set out above, subject to the approval of the Members. Such approval will be obtained, and other required steps to give effect to the sub-division will be sought, after the completion of the proposed Rights Issue.

5. OVERVIEW OF OPERATIONS:

Your Company posted a total income of Rs. 48,949.52 Lacs during the year ended March 31, 2013.

In spite of the current uncertainties and challenges in the real estate environment, your Company successfully demonstrated strong value addition to its development portfolio. During the year, your company managed to sign 8 new project stotaling approximately 6.6 million sq. ft. of saleable area. Your Company has successfully created a residential co-investment platform with a total corpus of Rs. 1072.5 crores, under which a Dutch co-operative representing a group of overseas investors and an Indian investor, is committed to equity investments in our residential projects. The platform will enable your Company to capture outright land purchase transactions without deviating from the asset light model followed by your Company. Your Company will receive development management fees for all projects undertaken under the fund, plus a share of equity profits from the projects.

During the year, your company continued to make significant progress in the Mumbai re-development space by signing five new residential re-development projects in Byculla, Ghatkopar, Curry Road,Malad and Sahakar Nagar

(Chembur), with a total saleable area of approximately 1.5 million square feet.

During the year, your Company launched 13 new projects and phases across the country. While volumes for the real estate sector have declined for the second consecutive year, your Company has delivered a 58% growth in booking volume and a 71% growth in booking value driven by successful new launches in Gurgaon, Bangalore, Kolkata, Pune, Ahmedabad and Mumbai. The highlight of the year was the successful launch of Godrej Summit in Gurgaon where your Company sold 695 apartments with 1 mn. sqft of saleable area in one day. Sales from new and existing phases of ongoing residential projects also continued to witness strong demand. During the year, your Company sold approx. 4.1 million sq. ft. of area with a total booking value of approx. Rs. 2761 crores, spread across all its location. Another milestone your Company achieved during the year was the handover of 535 apartments in Phase I of the Godrej Prakriti in Kolkata within the time period committed to our customers.

In sync with our vision of being the most trusted name in the real estate industry, your company has intensified its efforts with regards to our customer-centric initiatives, and is continuously incorporating customer feedback in design and specifications, across all its projects. Your Company has made good progress in its customer management and marketing abilities through numerous targeted customer engagement programs and innovative digital campaigns. Your Company has won 20 awards at the entity and project level including ''Real Estate Company of the Year'' at the Construction Week India Awards, ''Emerging Developer of the Year'' at the Bangalore Real Estate Awards 2012, being awarded the ''Platinum Award for Excellence'' by Construction World Magazine, being awarded the ''Popular Choice Developer of the Year'' in the residential category at the ET Now, ''Best Upcoming Township Award'' won by the Godrej Anandam Project at the My FM Dainik Bhaskar CREDAI Awards, ''Best Residential Project- Ahmedabad'' won by the Godrej Garden City Project at the CNBC Awaaz Real Estate Awards 2012, ''Best Residential Project- Kolkata'' won by the Godrej Prakriti Project at the CNBC Awaaz Real Estate Awards 2012. In recognition of our endeavour to maintain outstanding employee practices and encourage collaborative work spaces, your Company was ranked as the ''14th Best Company to Work For'' in the overall category, 2nd amongst companies with less than 1000 employees and the best company to work for in the Real Estate Industry by the Great Places to Work Survey 2012 conducted by Great Place to Work Institute.

Your Company continues to be at the forefront of sustainable development. 74% of our inventory launched in the financial year was registered/pre-certified as green by the Indian Green Building Council; up from 67% in FY 12 and 26% in FY 11. Key achievements in this area include numerous sustainable design certifications received during the year. These include Gold Pre-certifications for Godrej Horizon in Pune, Serenity in Mumbai and Gold County in Bangalore, all under the IGBC Green Homes rating system v.1.0. Godrej Central in Mumbai, which is yet to be launched, has been awarded Silver Pre-certification under the IGBC Green Homes rating system v 2.0. To consistently deliver green buildings, the company has set up internal benchmarks, integrated sustainability goals with project planning. In addition, your Company continuously engages its design and construction partners to create greener buildings. Under Green operations, your Company is working on reducing energy and water consumption and waste generated at our administrative offices in accordance with the Group wide Good & Green Targets.

6. FUTURE PROSPECTS AND OUTLOOK OF THE COMPANY:

Your Company will continue to focus on building scale through capital efficient business models such as sourcing land under the joint development model and the development manager model. Additionally, your Company will focus on sourcing land with large capital requirements in our target geographies under the Residential Co-investment platform with your Company acting as the development manager for these projects and sharing in the equity profits as well. Our primary areas of focus for new business development will be major cities like Mumbai, NCR, Bengaluru, Pune, and Chennai. In FY 11 your Company formed a new subsidiary Godrej Projects Development Private Limited (GPDPL) to focus on the opportunities available for redevelopment projects across Mumbai. GPDPL signed five new projects in FY 13 and will continue to actively explore suitable redevelopment opportunities which will be value accretive to GPL. Through strategic partnerships with leading construction firms, your Company is further strengthening its project execution capabilities across regions, and thereby endeavoring to ensure on-time delivery and quality.

7. FIXED DEPOSITS:

Your Company continues to accept fixed deposits for 12, 24 and 36 months'' tenure. During the financial year ended March 31, 2013, fixed deposits aggregating to Rs. 20,212.31 Lacs have been mobilised. The Company has no overdue deposits other than unclaimed deposits.

8. DEPOSITORY SYSTEM:

Your Company''s equity shares are available for dematerialisation through National Securities Depository Limited and Central Depository Services (India) Limited. As on March 31, 2013, 99.39 % of the equity shares of your Company were held in demat form.

9. CORPORATE GOVERNANCE:

As required by the existing Clause 49 of the Listing Agreements entered into by your Company with the BSE Limited and The National Stock Exchange of India Limited, a detailed Report on Corporate Governance together with a report on Management Discussion and Analysis is included in the Annual Report. The Auditors have certified the Company''s compliance with the requirements of Corporate Governance in terms of Clause 49 of the Listing Agreement and the same is annexed to the Report on Corporate Governance.

10. AWARDS & RECOGNITIONS:

Your Directors take pleasure in informing you that your Company was acknowledged with the following awards during the financial year ended March 31, 2013: l ''Best Marketing Campaign of the Year'' at the 3rd CMO Asia Awards, Singapore

l Real Estate Company of the year - Construction Week

India Awards 2012 l Emerging Developer of the year - Bangalore Real

Estate Awards 2012 l ''Efficient Bathrooms at Building Complexes'' by

Washrooms and Beyond Honours 2012

l Most Admired Real Estate Website of the year – 2nd Asian Leadership Awards

- ''CWAB Platinum Award for Excellence'' at the 7th Construction World Architect and Builder (CWAB) Awards, 2012

- Zee Business Awards in the real estate category

- 3 awards at CNBC Awaaz Real Estate Awards, 2012

- Godrej Garden City : ''Best Residential Project'' in Ahmedabad, in the mid-segment category of projects that are 70% complete

- Godrej Prakriti ''Best Residential Project'' in Kolkata, in the mid-segment category of projects that are 70% complete

- Godrej Waterside : " Best Commercial Property" in Kolkata

- ''Best Innovative/ Marque Developer of the Year - West India'' at the 4th Annual National Estate Awards and Summit organized by Franchise India

- Best Upcoming Township - Godrej Anandam, Nagpur received this award from My FM, Dainik Bhaskar and CREDAI Nagpur

- ''Best Business Practice in Real Estate'' at the National Real Estate Award for Excellence in Real Estate for the year 2012 by Accommodation Times.

- The following awards at the ''Real Estate Awards'' by ET NOW

- Godrej Properties won the Popular Choice- Developer of the Year in the Residential Category

- Godrej Properties won the Integrated Township of the year for Godrej Garden City

- Popular Choice for its Innovative Real Estate Marketing Campaign

- Godrej Anandam, Nagpur, won the ''Best Developer Award'' (Rest of Maharashtra) at the Vasturaviraj Vishwakarma Real Estate Awards

- ''Brand Leadership Award'' in the real estate sector at the Brand Leadership Awards 2013

- Godrej Garden City was awarded with the ''British

Safety Council International Award'' in Distinction Category for Affordable and Mass Housing

- Godrej One won the safety award with the British Safety Council International Award in Distinction Category for Information Technology and Office Space category

- Ranked amongst India''s Top 15 companies to work for in FY 2012, in a study by the Great Places to Work Institute and the Economic Times

- 14th Best Company to Work for in India in the overall category

- Ranked #1 in the Best Company in the real estate and construction sector

- Ranked #2 in the Best Company with under 1000 employees category

11. EMPLOYEES STOCK OPTION SCHEME:

The members of the Company had vide a Special Resolution passed through Postal Ballot on September 11, 2012 approved the amendment to the terms of the Godrej Properties Limited Employee Stock Option Plan (GPL ESOP) for revision in the Exercise Price.

As required in terms of the Securities and Exchange Board of India (Employees Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, as amended, the disclosure relating to Godrej Properties Limited Employee Stock Option Plan (GPL ESOP) is given in Annexure A (Part I) and the disclosure relating to Godrej Properties Limited Employee Stock Grant Scheme (GPL ESGS) is given in Annexure A (Part II).

12. SCHEME OF AMALGAMATION OF GODREJ WATERSIDE PROPERTIES PRIVATE LIMITED

Godrej Waterside Properties Private Limited, a wholly owned subsidiary of the Company was amalgamated with the Company in terms of the Scheme of Amalgamation (''Scheme'') sanctioned by the Hon''ble Bombay High Court vide order dated April 12, 2013. The appointed date of the Scheme was April 1, 2012.

13. SUBSIDIARY COMPANIES:

A. Subsidiaries'' Accounts

During the year under review, Godrej Redevelopers (Mumbai) Private Limited has been incorporated as subsidiary company of Godrej Projects Development Private Limited, a wholly owned subsidiary of your Company. Accordingly, as at March 31, 2013, your Company had 14 subsidiaries, namely, Godrej Realty Private Limited, Godrej Developers Private Limited, Godrej Real Estate Private Limited, Godrej Sea View Properties Private Limited, Happy Highrises Limited, Godrej Premium Builders Private Limited, Godrej Buildcon Private Limited, Godrej Garden City Properties Private Limited, Godrej Projects Development Private Limited, Godrej Nandhi Hills Project Private Limited, Godrej Buildwell Private Limited, Godrej Landmark Redevelopers Private Limited, Godrej Estate Developers Private Limited and Godrej Redevelopers (Mumbai) Private Limited.

Wonder Space Properties Private Limited, a wholly owned subsidiary of the Company, has been incorporated on April 25, 2013.

Pursuant to the General Circular No. 2/2011 dated February 8, 2011 issued by the Ministry of Corporate Affairs, Government of India, the Board of Directors of your Company have given their consent for not attaching the accounts of all the subsidiaries of the Company along with the Annual Report of the Company. In line with the above circular and as per the Accounting Standard 21 (AS 21) issued by the Institute of Chartered Accountants of India, the Audited Consolidated Financial Statements of your Company along with the Auditors'' Report have been annexed to this Annual Report.

The Company shall provide the copy of the annual accounts of the subsidiary companies and the related information to the members of the Company and also to the members of the subsidiary companies on their request. The annual accounts of the subsidiary companies will also be kept open for inspection by any members at the Registered Office of the Company and also at the Registered Office of the respective subsidiary companies during business hours.

B. Limited Liability Partnerships (LLPs)

Your Company is a partner in the following LLPs as of March 31, 2013:

1. Godrej Buildcorp LLP.

2. Godrej Property Developers LLP for the project located at Thane (Mumbai).

3. Godrej Vikhroli Properties LLP for the project located at Vikhroli.

4. Mosiac Landmarks LLP for the project located at Undri, Pune.

5. Dream World Landmarks LLP for the project located at Undri, Pune.

C. Material Non-Listed Indian Subsidiary

Pursuant to Clause 49 of the Listing Agreement, if the turnover or net worth (i.e. paid up capital and free reserves) of any unlisted Indian subsidiary company exceeds 20% of the consolidated turnover or net worth respectively of the listed holding company and its subsidiaries in the immediately preceding accounting year; that subsidiary is termed as a ''Material Non-Listed Indian Subsidiary''. There is no material non-listed Indian subsidiary of your Company for the financial year 2012-2013.

14. AMENDMENTS IN THE OBJECTS OF THE INITIAL PUBLIC OFFERING IN RELATION TO UTILISATION OF ISSUE PROCEEDS

In the last Annual General Meeting of your Company held on July 28, 2012, the Members had approved certain deviations/ amendments to the objects of the initial public offering, as disclosed on page 43 of the prospectus of your Company dated December 16, 2009 (the " Prospectus" ). Your Company received Rs. 468.85 Crores as the issue proceeds (the " Issue Proceeds" ). The net Issue Proceeds, after deduction of the issue related expenses, were Rs. 428.17 crores (the " Net Proceeds" ).

However there are further deviations in the utilisation of the issue proceeds from the last approved schedule of deployment and the details of the same are provided below:

a) Acquisition of land development rights for our forthcoming projects:

As per the approval received from the Members in the Annual General Meeting held on July 28, 2012, your Company was required to utilise Rs. 9.09 crores in the financial year 2012-2013 for its project located at Kalyan, subject to the aggregation of the balance land area. However, the said aggregation has not been completed during the financial year 2012-2013 and therefore; it is proposed that the said amount of Rs. 9.09 crores be utilized for the purpose of repayment of loans. Consequently, the total amount of Rs. 152 crores out of Net Proceeds which was proposed to be utilized for acquisition of land development rights for our forthcoming projects will be revised to Rs. 142.91 crores.

b) Repayment of Loans

As per the approval of the members in the Annual General Meeting held on July 22, 2011, an amount of Rs. 201.17 crores was to be utilised by the Company for repayment of loans, which was fully utilised by the Company in the financial years 2010 and 2012. However, as mentioned on page 47 of the Prospectus, the Company may re-schedule at its discretion the proposed utilization of Net Proceeds by increasing or decreasing the expenditure for a particular object and adjusting in other object. In order to reduce interest burden, it is proposed to utilize a further amount of Rs. 9.09 crores, which was earlier earmarked towards utilisation for the Kalyan project (as stated in para (a) above), for repayment of loan taken from State Bank of India under the Facility Agreement dated March 16, 2011.

* It was stated that an amount of Rs. 152.00 Crores shall be utilised from the Net Proceeds for Acquisition of land development rights for our forthcoming projects. Now amended such amount to Rs.142.91 Crores, as Rs. 9.09 Crores shall be utilised for repayment of loans .

** It was stated that an amount of Rs. 9.09 Crores shall be utilised in the fiscal year 2013. Now amended to state that no amount utilised in fiscal year 2013.

# The increase in the total estimated cost for repayment of loans and amount up to which will be financed from Net Proceeds is due to the utilization of Rs. 9.09 Crore originally proposed to be utilized for the Kalyan Project towards part repayment of loan taken from state Bank of India under the Facility agreement dated March 16,2011.

It was also stated in the Prospectus that out of the gross Issue Proceeds of Rs. 468.85 crores, an amount of Rs. 40.68 crores relates to issue expenses. The Company has spent Rs. 40.54 crores towards issue expenses, leaving a balance of Rs. 0.14 crore. It is therefore proposed to utilize the said amount of Rs. 0.14 crore towards part repayment of loan taken from State Bank of India under the Facility Agreement dated March 16, 2011.

Accordingly, the approval of the Members of the Company is also sought in the ensuing Annual General Meeting to amend the schedule of implementation of the Net Proceeds, as provided in the Prospectus (on page 43) as follows:

(Rs. in crores)

Sr. No Objects FY 2010 FY 2011 FY 2012 FY 2013 FY 2014

1. Acquisition of land development rights for our Forthcoming Projects 25.00 52.00 65.91 0.00 -

2. Construction of our Forthcoming project 0.00 62.30 12.70 - -

3. Repayment of loans 150.17 0.00 51.00 - 9.09

Total 175.17 114.3 129.61 0.00 9.09

The approval of the Members of the Company is also sought to utilize the amount of Rs. 0.14 crore earmarked for issue related expenses towards part repayment of loan taken by the Company from State Bank of India under the facility agreement dated March 16, 2011.

15. DIRECTORS:

In accordance with the Articles of Association of the Company and the provisions of the Companies Act, 1956, Mr. Adi B. Godrej, Mr. Jamshyd N. Godrej, Mr. Amitava Mukherjee and Mrs. Parmeshwar A. Godrej, retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

16. APPOINTMENT OF AUDITORS:

M/s. Kalyaniwalla & Mistry, Chartered Accountants, the Statutory Auditors of the Company, retire at the ensuing Annual General Meeting and have confirmed their eligibility and willingness to accept office, if re-appointed.

The Company has received a letter from M/s. Kalyaniwalla & Mistry to the effect that their re-appointment, if made, would be within the limits specified under Section 224(1B) of the Companies Act, 1956 and that they are not disqualified within the meaning of Section 226 of the Companies Act, 1956 for such re-appointment.

17. COST RECORDS COMPLIANCE REPORT

The Company has filed the Cost Record Compliance Report for the year 2011-12.

18. COMMITEES OF DIRECTORS:

a) Reconstitution of Management Committee:

During the year under review, the Management Committee was reconstituted on May 5, 2012 by appointing Mr. K. T. Jithendran and Mr. V. Srinivasan as members of the Committee with effect from May 5, 2012. Mr. Milind S. Korde ceased to be a member of the Committee with effect from March 31, 2012. The Committee currently comprises Mr. Adi B. Godrej - Chairman, Mr. Pirojsha Godrej – Managing Director & Chief Executive Officer, Mr. K. T. Jithendran, Executive Director and Mr. V. Srinivasan, Executive Director.

b) Reconstitution of Allotment Committee:

During the year under review, the Allotment Committee was reconstituted on May 5, 2012 due to resignation of Mr. Milind S. Korde who ceased to be a member of the Committee with effect from March 31, 2012. The Committee comprises currently Mr. Adi B. Godrej - Chairman, Mr. Pirojsha Godrej – Managing Director & Chief Executive Officer, Mr. K. T. Jithendran, Executive Director and Mr. Amit B. Choudhury, Independent Director.

19. ADDITIONAL INFORMATION:

a) In terms of the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956, the Directors Report and Accounts are being sent to all the members of the Company, excluding the statement of particulars of the employee under Section 217(2A) of the Companies Act, 1956. In accordance with the provisions of Section 217(2A) of the Companies Act, 1956 and the rules framed there under i.e. the Companies (Particulars of Employees) Rules, 1975, as amended, the names and other particulars of employees as required to be set out in the annexure to the Director''s Report is available for inspection at the Registered Office of the Company. Any member interested in obtaining a copy of the same may write to the Company Secretary at the Registered Office of the Company.

b) Information in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is given in Annexure B.

c) Your Company has devised proper systems to ensure compliance with all applicable laws.

20. GREEN INITIATIVES IN CORPORATE GOVERNANCE

The Ministry of Corporate Affairs, Government of India, has permitted companies to send electronic copies of Annual Report, notices etc., to the e-mail ids of shareholders. We have accordingly arranged to send the soft copies of these documents to the e-mail ids of shareholders, wherever applicable. In case any of the shareholders would like to receive physical copies of these documents, the same shall be forwarded on written request to the Registrars M/s. Karvy Computershare Private Limited.

21. DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors, based on the representation received from the Management and after due enquiry, confirm:

(i) that in the preparation of the annual accounts, the applicable accounting standards have been followed and no material departures have been made from the same;

(ii) 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 year ended March 31, 2013 and of the profits of the Company for that year;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

22. ACKNOWLEDGEMENT:

Your Directors wish to place on record their appreciation and sincere thanks to the state government, government agencies, banks, financial institutions, joint venture partners, customers, shareholders, fixed deposit holders, vendors and other related organisations, who through their continued support and co-operation, have helped, as partners, in your Company''s progress. Your Directors also acknowledge the hard work, dedication and commitment of the employees.

For and on behalf of the Board of Directors of Goderj Properties Limited

Place : Mumbai Adi B. Godrej

Date : May 9, 2013 Chairman


Mar 31, 2012

The Directors have pleasure in presenting the 27th Annual Report of your Company along with the audited accounts for the financial year ended March 31, 2012.

1. OPERATING RESULTS:

Your Company's performance during the financial year ended March 31, 2012 as compared to the previous period is summarized below:

Financial year Financial year 2011-2012 2010-2011 (Rs.in lacs) (Rs.in lacs)

Profit before Taxation 10,439.95 15,507.46

Tax Expenses (2,303.48) (4,892.10)

Profit after Taxation 8,136.47 10,615.36

Add: Surplus brought forward 21,087.59 15,195.39

AMOUNT AVAILABLE FOR APPROPRIATION 29,224.06 25,810.75 Appropriations:

Your Directors recommend appropriations as under:

Proposed Dividend 2,341.42 3,143.25 Dividend Distribution Tax 379.84 509.91

Transfer to General Reserve 820.00 1,070.00

Surplus carried forward 25,682.80 21,087.59

TOTAL APPROPRIATIONS 29,224.06 25,810.75

2. RAISING OF FUNDS PURSUANT TO INSTITUTIONAL PLACEMENT PROGRAMME (IPP):

During the financial year ended March 31, 2012, your Company issued and allotted 81,86,810 equity shares of Rs 10/- each at a premium of Rs 565/- per equity share, aggregating to Rs 470.74 Crores, to the eligible qualified institutional buyers pursuant to an Institutional Placement Programme ("IPP") in terms of Chapter VIII-A of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended. The public shareholding in your Company has increased to 25% of its issued and paid up equity share capital pursuant to the IPP. The equity shares allotted pursuant to the IPP were admitted for listing and trading on BSE Limited and The National Stock Exchange of India Limited with effect from March 29, 2012. Your Company shall use the proceeds of the IPP towards prepayment and repayment of existing debt of your Company and its subsidiaries, acquisition of land development rights and general corporate purposes.

Your Directors take this opportunity to thank all the investors for their overwhelming response and the confidence reposed by them.

3. DIVIDEND:

Your Directors recommend for approval of the members at the ensuing Annual General Meeting payment of final dividend of 30% per equity share (Rs 3/- per equity share) for the financial year ended March 31, 2012.

4. REVIEW OF OPERATIONS:

Your Company posted a total income of Rs 46,386.77 Lacs during the financial year ended March 31, 2012.

One major highlight for the year was the successful completion of the IPP undertaken by your Company in March 2012. In difficult market conditions, where recent fund-raising activities of certain other companies witnessed difficulties, your Company's offering was oversubscribed, enabling it to raise Rs 470.74 Crores. Your Company is the first company in India to do an IPP and the first real estate developer to successfully complete an entity level fund- raising exercise in the last 18 months.

In the current real estate environment facing various uncertainties and challenges, your Company successfully demonstrated strong value addition to its development portfolio. During the year under review, your Company added 10 new joint development deals, totaling approximately 10.4 million sq. ft. of saleable area. One of the key deals undertaken during the year under review was the memorandum of understanding and the development manager agreement with Godrej & Boyce Manufacturing Company Limited (G&B), to appoint your Company as the Development Manager for the development of G&B's land in Vikhroli and the development of two of G&B's residential towers in Vikhroli, respectively. As a result of the same, your Company will be responsible for conceptualization, design, sales and marketing of all future projects on G&B's land in Vikhroli; and will receive 10% of the total money received from the sales of units as development manager fees.

During the year under review, your Company also made significant progress in the Mumbai redevelopment space. Your Company signed a Development Agreement to undertake a residential redevelopment project in Sahakar Nagar in Chembur with a total projected saleable area of approximately 6 Lac sq. ft.

The financial year 2011-12 also marked the entry of your Company into the Nagpur region, with the signing of an agreement for, and launch of, its residential project, Godrej Anandam. The project with a total developable area of 2.76 million sq. ft., was launched in October 2011, and has received a good response from customers thereafter. Your Company also launched new residential projects in other key cities across the country, including Mumbai, Bengaluru, Chennai and Mangalore, and continued to witness strong demand for its new phases in its ongoing residential projects in Ahmadabad and Kolkata. During the year under review, the total area sold by your Company stood at approximately 2.42 million sq. ft.

Continuing with the strategy of efficient capital management, your Company transferred 49% equity stake in its subsidiary, Godrej Premium Builders Private Limited to SUN-Apollo India Real Estate Fund, LLC, acting through Madhavi SA Investments LLC and Madhavi Ventures Limited. Further, Godrej Project Development Private Limited ("GPDPL"), a wholly owned subsidiary of your Company, entered into an agreement with ASK Property Investment Advisors to sell 49% stake of Godrej Landmark Redevelopers Private Limited, a subsidiary of GPDPL.

In line with its vision of being the most trusted name in the real estate industry, your Company has intensified its efforts with regards to customer-centricity initiatives, and is continuously incorporating customer feedback in its projects. Your Company has made good progress in its customer management and marketing abilities through numerous targeted customer engagement programs and innovative digital campaigns.

Your Company has intensified its efforts to be at the forefront of sustainable development. 67% of the inventory launched in the financial year 2011-2012 was registered or certified as green, as compared to 26% in the financial year 2010-2011. Key achievements in this direction include numerous sustainable design certifications your Company received during the year. These include a LEED-Platinum pre-certification for Godrej One in Vikhroli, an IGBC Green Homes Platinum pre-certification for Godrej Platinum in Vikhroli, a LEED-Gold pre-certification for Godrej Genesis in Kolkata, an IGBC Green Homes Gold pre-certification for Godrej Platinum in Bengaluru and an IGBC Green Homes Silver pre-certification for Godrej Frontier in Gurgaon.

5. FUTURE PROSPECTS AND OUTLOOK OF THE COMPANY:

Your Company will continue to focus on building scale through sourcing land in a capital efficient manner. The primary areas of focus of your Company for new business development will be major cities like Mumbai, NCR, Bengaluru, Pune, and Chennai. In the financial year 2010-

2011, your Company formed Godrej Project Development Private Limited (GPDPL) to focus on the opportunities available for redevelopment projects across Mumbai. GPDPL has signed two development agreements and will continue to actively explore suitable re-development opportunities which will be value accretive to your Company. Through strategic partnerships with leading construction firms, your Company is further strengthening its project execution capabilities across regions, and thereby endeavoring to ensure on-time delivery and high quality.

6. FIXED DEPOSITS:

Your Company has accepted fixed deposits for 12, 24 and 36 months tenure, respectively. During the financial year ended March 31, 2012, fixed deposits aggregating to Rs14,912.84 Lacs have been mobilized.

7. DEPOSITORY SYSTEM:

Your Company's equity shares are available for dematerialization through National Securities Depository Limited and Central Depository Services (India) Limited. As on March 31, 2012, 99.38% of the equity shares of your Company were held in demat form.

8. CORPORATE GOVERNANCE:

As required by Clause 49 of the Listing Agreements entered into by your Company with the BSE Limited and The National Stock Exchange of India Limited, a detailed Report on Corporate Governance together with a report on Management Discussion & Analysis is included in the Annual Report. The Auditors have certified the Company's compliance with the requirements of Corporate Governance in terms of Clause 49 of the Listing Agreement and the same is annexed to the Report on Corporate Governance.

9. AWARDS & RECOGNITIONS:

Your Directors take pleasure in informing you that your Company was acknowledged with the following awards during the financial year ended March 31, 2012:

- Won the 'Best Emerging National Developer' and 'Best Residential Project- South' awards for the residential project 'Godrej Woodsman Estate'in Bangalore, at the 'Zee Business - RICS Real Estate Awards'.

- Voted amongst the Most Trusted Names in the Real Estate Industry

- India's Best Marketed Real Estate Company 2011 by 4Ps Business & Marketing (4Ps B&M) in association with ICMR.

- Selected amongst the 'Top Indian real estate companies' by STAR REALTY, 2011-12.

- 'Corporate Governance of the Year', 2011 award by Accommodation Times at the 26th National Real Estate Awards.

- Won the award for 'Asia's Most Admired Brand' in the Real Estate Sector at the Asian Leadership Awards 2011 for the marketing and branding initiatives carried out for its township project 'Godrej Garden City in Ahmadabad.

- Selected amongst 'India's Top 10 Builders' at the 6th Construction World Architect and Builder Awards 2011 for the 6th consecutive year.

- Won award for the 'Best Marketing Campaign of the Year' for Excellence in Branding and Marketing at the recently held 2nd CMO Asia awards in Singapore for an environmental awareness drive carried out at Godrej Prakriti, a residential project in Kolkata

- Emerged as one of the winners in the 'Tower Project of the Year' category at the inaugural Construction Week Awards 2011 for the residential projects in Mumbai.

- Selected as one of the top 200 Power Brands 2011- 12 of India after an extensive PAN India research conducted by ICMR.

- Won the 'Luxury Commercial Project of the year; award at the Property World Awards 2011 for its commercial project 'Godrej Waterside' located in Kolkata.

- Won the 'Commercial Project of the year' award at the EPC World Awards 2011 for its commercial project 'Godrej Waterside'located in Kolkata.

10. EMPLOYEES STOCK OPTION SCHEME:

As required in terms of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, as amended, the disclosure relating to Godrej Properties Limited Employee Stock Option Plan (GPL ESOP) is given in Annexure A (Part I) and the disclosure relating to Godrej Properties Limited Employee Stock Grant Scheme (GPL ESGS) is given in Annexure A (Part II).

11. SUBSIDIARY COMPANIES:

A. Subsidiaries' Accounts

During the year under review, Godrej Landmark Redevelopers Private Limited has been incorporated as subsidiary company of GPDPL, a wholly owned subsidiary of your Company. Accordingly, as at March 31, 2012, your Company had 14 subsidiaries, namely, Godrej Realty Private Limited, Godrej Waterside Properties Private Limited, Godrej Developers Private Limited, Godrej Real Estate Private Limited, Godrej Sea View Properties Private Limited, Happy Highrises Limited, Godrej Premium Builders Private Limited, Godrej Buildcon Private Limited, Godrej Garden City Properties Private Limited, Godrej Projects Development Private Limited, Godrej Nandhi Hills Project Private Limited, Godrej Buildwell Private Limited, Godrej Landmark Redevelopers Private Limited and Godrej Estate Developers Private Limited.

Pursuant to the General Circular No. 2/2011 dated February

8, 2011 issued by the Ministry of Corporate Affairs, Government of India, the Board of Directors of your Company have given their consent for not attaching the balance sheets of all the subsidiaries of the Company along with the Annual Report of the Company. The Audited Consolidated Financial Statements of your Company along with the Auditors' Report have been annexed to this Annual Report.

The Company shall provide the copy of the annual accounts of the subsidiary companies and the related information to the members of the Company and also to the members of the subsidiary companies on their request. The annual accounts of the subsidiary companies will also be kept open for inspection by any members at the Registered Office of the Company and also at the Registered Office of the respective subsidiary companies.

B. Transfer of Stake

1. During the year under review, pursuant to the agreements entered into by your Company with SUN-Apollo India Real Estate Fund LLC acting through Madhavi SA Investments LLC and Madhavi Ventures Limited (the "Investors"), your Company transferred 49% of the equity share capital of Godrej Premium Builders Private Limited to the Investors for a consideration of Rs 18.30 Crores.

2. During the year under review, GPDPL, a wholly owned subsidiary of your Company, transferred 49% equity stake of its subsidiary Godrej Landmark Redevelopers Private Limited (a step down subsidiary of your Company) to ASK Trusteeship Services Private Limited (acting in its capacity as a trustee of ASK Real Estate Special Opportunities Fund) and ASK Investment Managers Private Limited (acting in its capacity as portfolio manager of its product called ASK PMS Real Estate Special Opportunities Portfolio I and on behalf of its clients in such product), in the ratio of 20:80 for a consideration of Rs 20.02 Crores.

C. Limited Liability Partnerships (LLPs)

During the year under review, your Company has executed an Admission Deed on December 16, 2011, for entering into as a partner in a limited liability partnership, namely, M/s. Mosiac Landmarks LLP, for development of a project located at Undri, Pune. The Company has made a capital contribution of Rs 11.00 Lacs in M/s. Mosiac Landmarks LLP.

Accordingly, as of March 31, 2012, your Company is a partner in the following LLPs:

1. Godrej Buildcorp LLP for the project located at Hyderabad.

2. Godrej Property Developers LLP for the project located at Thane (Mumbai).

3. Godrej Vikhroli Properties LLP for the project located at Vikhroli.

4. Mosiac Landmarks LLP for the project located at Undri, Pune.

D. Material Non-Listed Indian Subsidiary

Pursuant to Clause 49 of the Listing Agreement, if the turnover or net worth (i.e. paid up capital and free reserves) of any unlisted Indian subsidiary company exceeds 20% of the consolidated turnover or net worth respectively of the listed holding company and its subsidiaries in the immediately preceding accounting year; that subsidiary is termed as a ;Material Non-Listed Indian Subsidiary'. There is no material non-listed Indian subsidiary of your Company for the financial year 2011-2012.

12. AMENDMENTS IN THE OBJECTS OF THE INITIAL PUBLIC OFFERING IN RELATION TO UTILISATION OF ISSUE PROCEEDS:

In the last Annual General Meeting of your Company held on July 22, 2011, the Members hpad approved certain deviations/ amendments to the objects of the initial public offering, as disclosed on page 43 of the prospectus of your Company dated December 16, 2009 (the 'Prospectus'). Your Company received Rs 468.85 Crores as the issue proceeds (the 'Issue Proceeds"). The net Issue Proceeds, after deduction of the issue related expenses, were Rs 428.17 crores (the 'Net Proceeds').

[However there are further deviations in the utilization of the issue proceeds from the last approved schedule of deployment, and the details of the same are provided below:

a) Acquisition of land development rights for our forthcoming Projects:

As per the approval received from the Members in the Annual General Meeting held on July 22, 2011, your Company was required to utilize Rs 75 Crores in the financial year 2011-2012. Your Company has utilized Rs65.91 Crores out of Rs 75 crores in the financial year 2011-2012 for its project located at Ahmadabad.

In relation to the property located at Kalyan, your Company was required to pay an amount of Rs 20.00 Crores from the Net Proceeds, subject to the aggregation of the entire 160 acres of land at Kalyan. Whilst your Company had paid Rs 10.91 Crores in the financial year 2010-2011, it was required to utilize the balance amount of Rs 9.09 Crores during the financial year 2011-2012, subject to the aggregation of the balance land area. However, the said aggregation has not been completed during the financial year 2011- 2012. Accordingly, it is now proposed to pay the balance amount of Rs 9.09 Crores in the financial year 2012-2013, once the aggregation of such balance land is completed.

b) Construction of Forthcoming Project

In relation to the construction of commercial project located in Chandigarh, your Company was required to utilize an amount of Rs 12.70 Crores during the financial year 2011-2012. This amount has been utilized by your Company during the financial year 2011-2012.

c) Repayment of Loans

In terms of the approval of the Members in the Annual General Meeting held on July 22, 2011, an amount aggregating to Rs 51 Crores out of the Net Proceeds has been utilized by your Company for repayment of the working capital loan to State Bank of India.

In light of the abovementioned reasons, the approval of the Members of the Company is sought in the ensuing Annual General Meeting for amending the schedule of deployment and utilization of the Net Proceeds, as provided hereunder:

(Rs.in Crores)

Sr. Expenditure Total Items Amount Balance Proposed No. Estimated deployed till payable as on to be

Cost November November funded by 15, 2009 (as 15, 2009 (as internal mentioned in mentioned in the accruals the Prospectus) Prospectus)



1. Acquisition of land 444.82 152.50 292.332 Nil Development right for our Forthcoming project

2. Construction 100.84 22.82 78.02 Nil of our Forthcoming project

3. Repayment of loans 201.17 Nil 172.00 Nil

Total 746.83 175.32 542.34 Nil

Expenditure Amount Estimated schedule of items up to which deployment of Net proceeds Will be for financed from net proceeds

FY 2010 FY 2011 FY2012 FY2013

Acquisition 152.00 25.00 52.00 65.91* 9.09** of land development rights for our forthcoming projects

Construction 75.00 0.00 62.30 12.70 - of our Forthcoming project

Repayment of 201.17 150.17 0.00 51.00 - loans

Total 428.17 157.17 114.3 129.61 9.09

* It was stated that an amount of Rs 75.00 Crores shall be utilized in the fiscal year 2012. Now amended to state that Rs 65.91 Crores was utilized in fiscal year 2012.

** The amount of Rs 9.09 Crores which was not utilized during the fiscal year 2012 is proposed to be utilized during the fiscal year 2013.

Accordingly, the approval of the Members of the Company is also sought in the ensuing Annual General Meeting to amend the schedule of implementation of the Net Proceeds, as provided in the Prospectus (on page 43) as follows:

(Rs.in Crores)

1. Acquisition of land FY 2010 FY 2011 FY 2012 FY 2013 development rights for our 25.00 52.00 65.91 9.09 Forthcoming Projects

2. Construction of our Forthcoming Project 0.00 62.30 12.70 -

3. Repayment of loans 150.17 0.00 51.00 -

Total 175.17 114.3 129.61 9.09

13. DIRECTORS:

a) Cessation

Mr. Milind S. Korde resigned as Managing Director of the Company and ceased to be the Managing Director with effect from April 1, 2012. Consequently, he also ceased to be a Director of the Company with effect from the said date. The Board places on record its appreciation for the valuable services and guidance given by Mr. Milind S. Korde to the Company during his tenure as the Managing Director of the Company.

b) Appointment

The Board of Directors at the meeting held on January 19, 2012, appointed, subject to approval of the Members of the Company, Mr. Pirojsha Godrej as the Managing Director & Chief Executive Officer of the Company with effect from April 1, 2012.

Further, the Board of Directors at the meeting held on January 19, 2012, appointed Mr. V. Srinivasan as an Additional Director of the Company with effect from April 1, 2012 and also as an Executive Director of the Company with effect from the said date. The appointment of Mr. V. Srinivasan as an Executive Director of the Company is subject to approval of the Members of the Company at the ensuing Annual General Meeting.

c) Re-appointment

In accordance with the Articles of Association of the Company and the provisions of the Companies Act, 1956, Mrs. Lalita D. Gupte, Mr. S. Narayan, Mr. Pranay D. Vakil and Dr. Pritam Singh, retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

14. APPOINTMENT OF AUDITORS:

M/s. Kalyaniwalla & Mistry, Chartered Accountants, the Statutory Auditors of the Company, retire at the ensuing Annual General Meeting and have confirmed their eligibility and willingness to accept office, if re-appointed.

The Company has received a letter from M/s. Kalyaniwalla & Mistry to the effect that their re-appointment, if made, would be within the limits specified under Section 224(1B) of the Companies Act, 1956 and that they are not disqualified within the meaning of Section 226 of the Companies Act, 1956 for such re-appointment.

15. COMMITTEES OF DIRECTORS:

a) Reconstitution of Investors Grievance cum Share Transfer Committee:

During the year under review, the Investors' Grievance cum Share Transfer Committee was reconstituted on January 19, 2012 by appointing Mr. Pirojsha Godrej as a member in the said Committee. Mr. Milind S. Korde ceased to be a member of the Committee with effect from April 1, 2012. The Committee comprises of Mr. Adi B. Godrej - Chairman, Mr. Pirojsha Godrej - Managing Director & Chief Executive Officer and Mr. Amit B. Choudhury, Independent Director.

b) Securities Issuance Committee:

The Board of Directors through a circular resolution dated February 8, 2012 had formed the Securities

Issuance Committee for issuance, allotment and listing of the equity shares of the Company pursuant to an IPP in terms of Chapter VIII-A of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended and for all other matters relating to the same.

The Committee comprises of Mr. Adi B. Godrej - Chairman, Mr. Pirojsha Godrej - Managing Director & Chief Executive Officer and Mr. Amit B. Choudhury, Independent Director.

16. ADDITIONAL INFORMATION:

a) In terms of the provisions of Section 219(1 )(b)(iv) of the Companies Act, 1956, the Directors' Report and Accounts are being sent to all the Members of the Company, excluding the statement of particulars of the employee under Section 217(2A) of the Companies Act, 1956. In accordance with the provisions of Section 217(2A) of the Companies Act, 1956 and the rules framed there under i.e. the Companies (Particulars of Employees) Rules, 1975, as amended, the names and other particulars of employees as required to be set out in the annexure to the Directors' Report is available for inspection at the Registered Office of the Company. Any Member interested in obtaining a copy of the same may write to the Company Secretary at the Registered Office of the Company.

b) Information in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is provided hereunder:

(i) Conservation of Energy:

Expenses on account of energy are negligible.

(ii) Technology Absorption:

It is an on-going process.

(iii) Foreign Exchange Earnings and Outgo:

During the financial year 2011-12, expenditure in foreign currencies amounted to Rs 943.30 Lacs (Previous Year Rs 1,001.41 Lacs) on account of professional & consultation fees and expenses incurred for business promotion.

The Company has not earned any foreign exchange during the year.

c) Your Company has devised proper systems to ensure compliance with all applicable laws.

17. GREEN INITIATIVES IN CORPORATE GOVERNANCE

The Ministry of Corporate Affairs, Government of India, has permitted companies to send electronic copies of Annual Report, notices etc., to the e-mail ids of shareholders. We have accordingly arranged to send the soft copies of these documents to the e-mail ids of shareholders, wherever applicable. In case any of the shareholders would like to receive physical copies of these documents, the same shall be forwarded on written request to the Registrars M/s. Karvy Computershare Private Limited.

18. DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors, based on the representation received from the Management and after due enquiry, confirm:

(i) that in the preparation of the annual accounts, the applicable accounting standards have been followed;

(ii) 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 year ended March 31, 2012 and of the profits of the Company for that year;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

19. ACKNOWLEDGEMENT:

Your Directors wish to place on record their appreciation and sincere thanks to the state government, government agencies, banks, financial institutions, joint venture partners, customers, shareholders, fixed deposit holders, vendors and other related organizations, who through their continued support and co-operation, have helped, as partners, in your Company's progress. Your Directors also acknowledge the hard work, dedication and commitment of the employees.

For and on behalf of the Board of Directors

of Godrej Properties Limited

Place: Mumbai Adi B. Godrej

Date: May 5, 2012 Chairman


Mar 31, 2011

The Directors have pleasure in submitting the Annual Report along with the Audited Accounts for the year ended March 31, 2011.

Review Of Operations

Your Companys performance during the year as compared with that during the previous year is summarized below.

Rs. Crore Year ended March 31, 2011 2010

Sales of products and services 1,058.83 816.37

Other Income 195.71 175.33

Total Income 1,254.54 991.70

Total Expenditure other than Interest and Depreciation 1,026.56 823.07

Profit before Interest, Depreciation and Tax 227.98 168.63

Depreciation 28.85 28.39

Profit before Interest and Tax 199.13 140.24

Interest and Financial Charges (net) 63.12 60.25

Profit before Tax 136.01 79.99

Provision for Current Tax (1.36) (0.13)

Provision for Deferred Tax 3.94 (0.80)

Net Profit 133.43 80.92

Surplus brought forward 311.46 294.18

Profit after Tax available for appropriation 444.89 375.10

Appropriation

Your Directors recommend appropriation as under:

Dividend on Equity Shares 55.58 47.64

Tax on distributed profits 9.02 7.91

Transfer to General Reserve 13.34 8.09

Surplus Carried Forward 366.95 311.46

Total Appropriation 444.89 375.10

The Total Income increased by Rs. 262.84 crore from Rs. 991.70 crore to Rs. 1254.54 crore, a growth of 27%. The Net Profit for the year was Rs. 133.43 crore as compared to Rs. 80.92 crore in the previous year, a growth of 65%.

Dividend

The Board of Directors of your Company recommends a final dividend of Rs. 1.75 per equity share of Rs. 1/- each, aggregating Rs. 55.58 crore (previous year Rs. 1.50 per equity share).

Management Discussion And Analysis

There is a separate section on Management Discussion and Analysis appended as Annexure A to this Report, which includes the following:

- Industry Structure and Developments

- Discussion on financial performance with respect to operational performance

- Segmentwise performance

- Human Resources and Industrial Relations

- Opportunities and Threats

- Internal Control Systems and their adequacy

- Risks and Concerns

- Outlook

Subsidiary, Associate And Joint Venture Companies

Your Company has interests in several industries including animal feeds, agri-inputs, oil palm plantation and poultry, property development, personal and home care, beverages and confectionery, etc. through its subsidiary / associate / joint venture companies.

Godrej Agrovet Limited (GAVL)

Fiscal year 2011 has been an excellent year for GAVL. Consolidated Turnover increased to Rs. 1,897.47 crore, a 20% jump over the previous year and the Consolidated Profit after tax but before extra ordinary income increased from Rs. 32.58 crore to Rs. 59.57 crore, an increase of 83%.

The core businesses of Animal Feeds and Agri Inputs have had a very good year. The Animal Feeds business broke out of flat tonnages and registered a volume growth of over 10%. Several initiatives undertaken over the last few years – separating the poultry and cattle feed sales forces, building a strong marketing team, implementing SAP and investing in R&D – have begun to deliver substantial results and contributed to improving business performance. In fact, GAVL won an award for Customer Excellence from SAP for the excellent SAP implementation at GAVL.

GAVL also completed acquisition of the 51% stake in their Aqua Feed joint-venture, Godrej Gold Coin Aquafeed Limited, this year, and has since been merged with GAVL.

The Animal Feed business recorded a strong growth of 12% in volumes and 13% in revenue. Profitability too grew significantly by 63%, due to measures undertaken for margin expansion. GAVL also launched Summer Kool, a heat stress preventive cattle feed additive and Super Star, a high performance broiler feed. Both these products were well accepted and received overwhelming response from the market.

The Agricultural Inputs business had a very good year and grew by 20% in revenue and 40% in profit. Hitweed, our herbicide for broad leaf crops was a great success, with volumes growing from 21 KL in 2009-10 to 71 KL this year.

The Oil Palm business has attained a major milestone by crossing one lac MT of Fresh Fruit Bunches crushed during the year. During the year about 4,000 ha. were covered under Oil Palm Plantation taking the total to about 38,000 ha. Improvement in operational efficiencies and additional arrivals from newly emerging areas helped the business to post improved results during the year. Turnover increased to Rs. 115 crore, a jump of 80% over the previous year. Operating profit increased from Rs. 8 crore to Rs. 21 crore. During the year, the business successfully completed a capital expenditure programme including acquiring of Land at Chintampalli, Andhra Pradesh, for a new Palm Oil Mill and augmentation of capacity of existing Mill from 30 TPH to 40 TPH. The Union budget has allocated Rs. 300 crore towards the development of Oil Palm sector which is expected to boost performance of the business going forward.

Revenues from Poultry increased by 40% in FY 2010-11 as compared to the previous year.

Godrej Properties Limited (GPL)

GPL continues to take substantial strides towards its ambition of becoming a leading national real estate developer. GPL reported excellent financial and operational performance for fiscal year 2011. Consolidated total income increased by 43% over the previous year to Rs. 558.9 crore and net profit increased by 7% to Rs. 130.9 crore.

This business has unprecedented growth opportunities ahead with the scale rapidly increasing. The organization is also becoming more complex as it develops a pan India footprint.

GPL registered notable volumes this year, with successful launches in high growth cities and reported healthy construction progress across all existing projects, including Ahmedabad, Gurgaon, Kolkata, Bangalore and Mumbai.

Bookings grew by 132% over the previous year to 3.2 million square feet. Godrej Garden City our township project in Ahmedabad, continued to receive a strong response with bookings of 1.6 million square feet. Godrej Frontier, our foray into the National Capital Region, registered bookings of 0.68 million square feet and Godrej Prakriti, our residential project in Kolkata, saw bookings of 0.63 million square feet in the year.

In January 2011, the 35 acre, 2.8 million square feet mixed-use development, at Vikhroli, The Trees, was launched. GPL also entered into a joint development agreement with Bombay Footwear to develop 0.15 million square feet of residential space in Chembur, Mumbai and formed a separate subsidiary to focus on redevelopment opportunities in Mumbai.

Planet Godrej, Mumbai, was awarded the first Seven Star rating to any project by CRISIL and Godrej Eternia, Chandigarh received a Leadership in Energy and Environmental Design (LEED)-Platinum pre-certification. GPL also won the Construction World Award 2010 and was recognised as being among Indias top ten builders for the fifth consecutive year. GPL continues to focus on being an employer of choice and was ranked in the Top 100 in Indias Best Companies to Work For, a study conducted by the Economic Times.

Godrej International Limited (GINL)

Godrej International Limited is our subsidiary company, which trades worldwide in vegetable oils. In fiscal year 2011, GINL turnover increased by about 34% over the previous year to US$ 161.70 million and profits increased by about 46% to US$ 2.23 million. This performance has been noteworthy, given that it comes at a time of difficult and volatile markets. The lagging impact of the economic crisis seems to be reversing and we expect GINL to continue to do well in the year ahead.

Natures Basket Limited (NBL)

Our foray into gourmet food retailing, Natures Basket, has been ramping up very well with a strong expansion in Mumbai and beyond. We currently have 14 stores and plan for 8 new stores in the coming year. The business is well positioned as the retail destination for gourmet and fine food and is an excellent rub off on the Godrej brand.

The gross turnover of this business for the fiscal year 2011 was Rs. 56 crore, a growth of 63% over the previous year. We intend to focus on growing this business and its profitability over the next few years.

Godrej Hershey Limited (GHL)

Godrej Hershey, our food and beverages business is a Joint Venture between The Hershey Company (USA) and the Godrej Group, with your Company holding a 43.4% stake. This JV operates in multiple categories such as confectionery, beverages, and grocery items.

The Beverages portfolio consists of Jumpin (fruit drinks), Xs (juices and nectars) and Sofit (soya milk). Sofit is the market leader in the niche but fast growing soya milk market.

During fiscal year 2011, beverages grew 10% over the previous year and chocolate syrup grew by 47%. Both beverage brands, Jumpin and Sofit were made stronger with a consumer relevant re-stage exercise.

Nutrine Confectionery Company Limited (NCCL)

Nutrine Confectionery Company Limited, a wholly owned subsidiary of GHL, is a major player in the sugar confectionery business in

India. Its product portfolio includes strong brands like Maha Lacto, Maha Coffee Eclairs, Maha Choco, Nutrine Eclairs, Nutrine Lollipop, Aamras and Honeyfab.

NCCL has maintained its position as a leading player in confectionary market and the new product launches this year have reinvigorated its portfolio. During the last year, NCCL re-staged its flagship brand, Maha Lacto and launched Maha Coffee Eclairs and Maha Lacto Hattrick. Maha Coffee Eclairs is a highly differentiated innovation, which gives the consumer a unique coffee and chocolate experience in an eclairs format. The big thrust has been investment in brand building and the core brands and innovations have been aggressively supported in mass media.

The steep increase in input costs, primarily sugar, has put severe pressure on margins and NCCL has undertaken some major cost savings projects during the year, which have yielded benefits. NCCL is also aiming at addressing the issue of margins by launching differentiated product innovations that offer the consumer a marked jump in experience at higher price points.

Godrej Consumer Products Limited (GCPL)

GCPL had a good fiscal year 2011. Consolidated Net Sales stood at Rs. 3,643 crore, as against last years Sales of Rs. 2,041 crore and Profit After Tax increased by 51% from Rs. 340 crore last year to Rs. 515 crore in the current year.

This has also been a transformative year on many fronts. In June 2010, GCPL acquired the remaining 52% share in Godrej Sara Lee Limited and with the merger of the two businesses, GCPL is now the largest Indian Household and Personal Care company. We believe that this merger provides us a unique opportunity to significantly change the trajectory of our FMCG business as we leverage the complementary strengths of the two companies to create one GCPL.

GCPL continued the evolution from an Indian FMCG company to a leading emerging markets

FMCG company and has followed a very disciplined and focused globalization approach in line with its 3 by 3 strategy - presence in 3 continents - Asia, Africa and Latin America through 3 core categories - home care, hair care and personal wash. Through its numerous acquisitions, GCPL now has operations in Indonesia, South Africa, Nigeria, Argentina, Uruguay, UK and the Middle East. Its products are now available in 55 countries around the globe and about one third of revenues in fiscal year 2011 came from international operations.

GCPL is the leader in hair colour, home insecticides and liquid detergents and the number two player in soaps in the Indian market. GCPL is also the market leader in air fresheners and wet tissues in Indonesia, in hair colours in many countries in Africa and Latin America. GCPL is the number two player in home insecticides in Indonesia and hair extensions in South Africa.

Financial Position

The financial position of your Company continues to be sound. The loan funds at the end of the year stand at Rs. 554.22 crore as compared to Rs. 547.61 crore in the previous year. The debt equity ratio is 0.49 as compared to 0.52 last year. Your Company continues to hold the topmost rating of A1+ from ICRA for its commercial paper program (Rs. 160 crore, enhanced from Rs. 140 crore). ICRA has reaffirmed an A1+ rating for the short term debt instruments/other banking facilities (Rs. 595 crore). This rating of ICRA represents highest-credit quality carrying lowest-credit risk. ICRA also reaffirmed LAA rating for long-term debt, working capital and other banking facilities (Rs. 470 crore). This rating represents high-credit quality carrying low-credit risk.

ICRA Online has assigned a rating of the Fundamental Grade 4+ and the valuation Grade B to the Equity Research rating program of your Company. The Fundamental Grade 4 assigned to your Company implies that the Company has strong fundamentals relative to other listed securities in India, while + indicates relatively stronger position within the grading category. The Valuation grade B assigned implies that your Company is “moderately undervalued on a relative basis”.

Manufacturing Facilities

The chemicals division of your Company has manufacturing units at Vikhroli and Valia.

Vikhroli: Vikhroli factory has successfully completed two surveillance audits of the Integrated Management System (ISO 9001 : 2008, Environment Management Systems – ISO 14001 : 2004, Occupational Health & Safety Assessment Series – OHSAS 18001 : 2007) conducted by Bureau Veritas.

Valia: Valia factory, which is already certified for ISO-9001:2008 and ISO 14001:2004 standards, has also implemented OHSAS 18001:2007 and after Certification Audit by Bureau Veritas, it is now recommended for the certificate.

New products C20-90%, C22-98% Fatty Alcohols and Emulsifying Wax were successfully produced on commercial scale, new spray dryer plant commissioned for the production of SLS powder and needles.

The factory has implemented and is monitoring the GMP systems for the surfactant plant.

Vegoils Division (Wadala): This division continues as a contract processor of edible oils and vanaspati. The division recorded a turnover of Rs. 2.86 crore as against Rs. 2.44 crore in the previous year.

New manufacturing facilities at Ambernath

Your Company has acquired 17 acres of Industrial land at Additional Ambernath MIDC. The project involves expansion (and relocation of some of the existing facilities from Vikhroli) at Additional Ambernath Industrial Area, Thane district with a modern plant with state of the art technology.

The proposed manufacturing facilities at Ambernath will have suitable energy efficient technologies to reduce specific energy consumption.

In continuation of the environment friendly initiatives, your Company has additionally acquired 4 acres of land for GREEN BELT development.

Research And Development

In the current year, we have incorporated a separate R&D Centre, catering exclusively to the Chemicals business. The GIL Research Centre will soon be a recognized In-House R&D Unit, post its approval from the DSIR.

Activities have been initiated to develop new processes and modify existing processes for the manufacturing of premium quality fatty acids from economy grade raw materials. We will continue to focus our attention on high value fractionated fatty acids for the polymer, oilfield and lubricant industries. This year we have launched value added, upstream products, based on fatty alcohols, and continue to develop processes for high value derivatives of glycerine and fatty acids. Parallel to these activities, R&D has also taken up initiatives to develop and customize specialty surfactants specifically for the oral care and personal care markets, thus meeting customers specific needs.

Human Resource Development and Industrial Relations

Your Company was recognised among Indias Best 50 Companies to Work in a survey conducted by Great Place to Work Institute, India for inspiring trust among people, instilling pride in them and creating an environment within the workplace that promotes camaraderie.

Your Company has always emphasized on quality and its employees are encouraged to get involved in the continuous process of improving quality through TQM and quality circles. Two quality circles from the Vikhroli Factory viz, Shilpakar Quality Circle and Navanirman Quality Circle were recognized as “Excellent Quality Circle” and “Distinguished Quality Circle” respectively by the Quality Circle Forum of India in the 24th National Convention on Quality Circles held in Visakhapatnam.

Industrial relations at all plant locations remained harmonious. Your company entered into a 3-year wage agreement for Vikhroli Factory. Regular structured safety meetings were held with employees and safety programmes were conducted for them throughout the year.

Sustainability Update

There is a separate report on sustainability update as Annexure B to this Report.

Information Systems

Your Company had entered into a strategic alliance with Hewlett Packard (HP) for a comprehensive IT outsourcing and transformation project. The transition to HP services has been smooth and without any disruption to business operations. Application and Infrastructure maintenance services are improving on an ongoing basis. Several initiatives were taken on improvement of business processes for increasing business efficiency on the SAP and the CRM systems. These systems are now widely used across the organization as well as by customers.

Employee Stock Option Plan (ESOP)

During the financial year 2010-11, 10 employees of the Company were granted ESOPs based on their leadership responsibility and potential

Date of Grant of ESOP No. of ESOP No. of Employees

June 25, 2010 50,000 4

August 6, 2010 65,000 6

Total 1,15,000 10

Disclosure in compliance with clause 12 of the Securities and Exchange Board of India (Employees Stock Purchase Scheme) Guidelines, 1999 is given in Annexure C attached and forms a part of this report.

Employee Stock Grant Scheme 2011

The Shareholders had vide resolution passed through postal ballot on January 17, 2011 approved Employee Stock Grant Scheme 2011. Under the said scheme, the Company, based on performance criteria, will offer and allot shares of the Company for the benefit of employees and directors of the Company and its Subsidiary Companies (except those who are promoters or belong to the promoter group), not exceeding 25,00,000 (Twenty five lac only) shares on such terms and conditions as may be fixed or determined by the Board. The main objectives of the scheme are :

- To recognize and reward the efforts of employees and their continued association with the Company;

- To introduce an objective component of employee compensation, which would provide a direct linkage to the efforts of the employees with a measurable and widely accepted criterion i.e. the equity share price of the Company. This could act as a motivational tool for the employees of the Company;

- To keep long association with the Company;

- To have employee participation in equity shareholding of the Company;

- To provide the employees an incentive to continue and strengthen their association with the Company so as to result in long term benefits to the Company as well as the employee – shareowner;

- Bring long-term value to the equity shareholders;

- Motivate employees to better the Companys performance continuously.

On May 30, 2011, the Compensation Committee approved 3,61,797 stock grants equivalent to 3,61,797 equity shares of the Company to eligible employees in terms of the said Scheme. The grants would vest in three equal parts every year over the next three years. The exercise price is Rs. 1/- per equity share as provided in the Scheme.

Group for interse transfer of shares

As required under Clause 3(1) (e) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, persons constituting Group (within the meaning as defined in the Monopolies and Restrictive Trade Practices Act, 1969) for the purpose of availing exemption from applicability of the provisions of Regulation 10 to 12 of the aforesaid SEBI Regulations are given in Annexure D attached herewith and forms a part of this Report.

Fixed Deposits

Your Company continues to accept public deposits for 13, 24 and 36 months tenor. The Fixed Deposits scheme has received an overwhelming response and the management of the company is thankful to all the investors for participating in the scheme and for the trust reposed in the company. During the year ended March 31, 2011, deposits aggregating to Rs. 57.38 crore have been mobilised and deposits aggregating to Rs. 7.87 crore have been repaid on maturity. The Company has no overdue deposits other than unclaimed deposits.

Depository System

Your Companys equity shares are available for dematerialization through National Securities Depository Limited and Central Depository Services (India) Limited. As of March 31, 2011, 99.70 % of the equity shares of your Company were held in demat form.

Directors

During the year, Mr. V. F. Banaji and Mr. M. P. Pusalkar, Executive Directors, retired from the Company with effect from April 30, 2010 and ceased to be directors of the Company. Mr. V. N. Gogate, Independent Director, ceased to be a director with effect from July 27, 2010.

In accordance with Article 127 of the Articles of Association of the Company, Mr. V. M. Crishna, Mr. K. N. Petigara, Mr. J. N. Godrej and Ms. T. A. Dubash retire by rotation at the ensuing Annual General Meeting and offer themselves for reappointment.

Auditors

You are requested to appoint Auditors for the current year and to authorise the Board to fix their remuneration. The retiring auditors, Kalyaniwalla and Mistry, Chartered Accountants, are eligible for reappointment. A certificate from the Auditors has been received to the effect that their reappointment, if made, would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.

Audit committee

The Audit Committee, which was constituted pursuant to the provisions of Section 292A of the Companies Act, 1956 and the listing agreement, has reviewed the Accounts for the year ended March 31, 2011. The members of the Audit Committee are Mr. F.P. Sarkari (Chairman), Mr. S.A. Ahmadullah, Mr. K.N. Petigara and Mr. K.K. Dastur, all Independent Directors.

Directors responsibility statement

Pursuant to the provisions contained in Section 217(2AA) of the Companies Act, 1956, the Directors of your Company confirm:

a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and no material departures have been made from the same;

b) that such accounting policies have been selected and applied consistently, and such judgments and estimates have been made 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 or loss of the Company for that period;

c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company, for preventing and detecting fraud and other irregularities;

d) that the annual accounts have been prepared on a going concern basis.

The Directors of your Company further confirm that proper systems are in place to ensure compliance of all laws applicable to the Company.

Corporate governance

As required by the existing clause 49 of the Listing Agreements with the Stock Exchanges, a detailed report on Corporate Governance is included in the Annual Report. The Auditors have certified the Companys compliance of the requirements of Corporate Governance in terms of clause 49 of the Listing Agreement and the same is annexed to the Report on Corporate Governance.

Additional information

Annexure E to this Report gives information in respect of Conservation of Energy, Technology absorption and Foreign Exchange Earnings and Outgo, required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 and forms a part of the Directors Report.

In the context of a globalizing Indian economy, increased number of subsidiaries and the introduction of accounting standards on consolidated financial statements, the Ministry of Corporate Affairs vide its circular no.2/2011 dated February 8, 2011 has granted a general exemption from publishing the accounts of subsidiaries provided certain conditions are fulfilled.

In line with the above Circular and as per the Accounting Standard 21 (AS 21) issued by the Institute of Chartered Accountants of India, the consolidated financial statements of the Company along with its subsidiaries forms a part of this Annual Report. Accordingly, this Annual Report of your Company does not contain the financial statements of its subsidiaries.

The Audited Annual Accounts and related information of the Companys subsidiaries will be made available upon request. These documents will also be available for inspection during business hours at the Companys registered office in Mumbai, India. All these reports / documents are available on the Companys website, www.godrejinds.com. The subsidiary companies documents will also be available for inspection at the respective registered offices of the subsidiary companies during business hours.

Information as per Section 217(2A) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 forms a part of the Directors Report. As per the provisions of Section 219(1) (b) (iv) of the Companies Act, 1956, the Report and Accounts are being sent to the Shareholders of the Company, excluding the statement of particulars of employees u/s 217(2A) of the Companies Act, 1956. Any shareholder interested in obtaining a copy of the same may write to the Company Secretary at the registered office of the Company.

The Notes to the Accounts referred to in the Auditors Report is self-explanatory. Details of related party transactions are presented in Schedule 20, Note No. 19 to Annual Accounts of the Annual Report. In respect of the qualifications in the Audit Report, we state as follows:

Loans and Advances include Rs. 10.33 crore (Previous year Rs. 10.33 crore) advanced by the Company to certain individuals against pledge by way of deposit of equity shares of Gharda Chemicals Ltd. The Company has enforced its security and lodged the shares for transfer in its name, however, the transfer application has been rejected by Gharda Chemicals Ltd. and the Company filed an appeal before the Company Law Board against the rejection. The investee company had in the meanwhile, moved the Bombay High Court and the Court remanded the matter back to CLB. The CLB has advised that the parties may approach the Bench after final disposal of the suit filed by the investee company and the application made by minority shareholders under section 397/398 before the Honble High Court. The Company has filed an appeal with the Honble High Court against the order of the Company Law Board under Section 10 F of the Companies Act 1956, which is pending for final disposal. The recoverability of the advance is contingent upon the transfer and/or disposal of the said shares. It is the opinion of the management that the underlying value of the said shares is substantially greater than the amount of the loan.

Acknowledgement

Your Directors thank the Union Government, the Governments of Maharashtra and Gujarat as also all the Government agencies, banks, financial institutions, shareholders, customers, employees, fixed deposit holders, vendors and other business associates, who, through their continued support and co-operation, have helped as partners in your Companys progress.

For and on behalf of the Board of Directors

Adi Godrej Chairman


Mar 31, 2010

The Directors have pleasure in submitting the Annual Report along with the Audited Accounts for the year ended March 31, 2010.

DIVIDEND

The Board of Directors of your Company recommends a fi nal dividend of Rs. 1.50 per equity share of Re. 1/- each, aggregating Rs. 47.65 crore (previous year Rs. 1.25 per equity share).

MANAGEMENT DISCUSSION AND ANALYSIS

There is a separate section on Management Discussion and Analysis appended as Annexure A to this Report, which includes the following:

- Industry Structure and Developments

- Discussion on fi nancial performance with respect to operational performance

- Segmentwise performance

- Human Resources and Industrial Relations

- Opportunities and Threats

- Internal Control Systems and their adequacy

- Risks and Concerns

- Outlook

SUBSIDIARY, ASSOCIATE AND JOINT VENTURE COMPANIES

Your Company has interests in several industries including animal feeds, poultry and agro-products, oil palm plantation, property development, personal and home care, beverages and confectionery, etc. through its subsidiary / associate / joint venture companies.

Godrej Agrovet Limited (GAVL):

The turnover of GAVL increased from Rs. 1,283.46 crore to Rs. 1,391.60 crore, an 8% increase over the previous year. The Profi t after tax but before extra ordinary income increased from Rs. 13.32 crore to Rs. 21.71 crore.

The year under review saw the core businesses of Animal Feeds and Agri Inputs returning an extremely good performance, both in revenue and profi t.

The Animal Feed business recorded a growth of 16% in revenue and 31% in profi t. The profi tability grew due to expansion of contribution margins and control over fixed overheads. The expansion of contribution margins was possible due to effi cient sourcing, improved formulation and successful R & D efforts.

The Agricultural Inputs business grew by 19% in revenue and 22% in profi tability. This success is even more impressive in the light of a failed monsoon and drought conditions that followed. The sales growth was fuelled by innovative products from in-house R & D in addition to growth in the more commoditised pesticides and Organic Manure Mixture.

GAVL enjoyed signifi cantly lower borrowing costs on account of effi cient treasury management. GAVL also successfully implemented SAP in its Animal Feed business and the implementation has started yielding signifi cant business benefi ts.

During the year, GAVL transferred its entire shareholding in Natures Basket Limited (NBL) to your Company. GAVL continues to be the holding Company of Godrej Oil Palm Limited (GOPL), Cauvery Palm Oil Limited (CPOL) and Golden Feed Products Limited (GFPL).

Godrej Properties Limited (GPL):

During the year 2009–10, GPL entered the capital market with an Initial Public Offer (IPO) of 9,429,750 equity shares of Rs. 10/- each, through 100% Book Building Process wherein 7,732,405 equity shares were allotted to the subscribers, at a premium of Rs. 480/- per share and 1,697,345 equity shares were allotted to certain Anchor Investors at a premium of Rs. 520/- per share. The issue was subscribed about 3.6 times. GPL shares were listed on the Bombay Stock Exchange Limited and National Stock Exchange of India Limited on January 5, 2010.

GPL posted a total revenue of Rs. 313.43 crore for the year ended March 31, 2010 from Rs. 255.52 crore for the year ended March 31, 2009, thereby a growth of 23% over last year. The net profi t grew by 62% at Rs. 124.19 crore for the year ended March 31, 2010 from Rs. 76.62 crore for the year ended March 31, 2009. During the year, GPL successfully completed several projects, most notably the 1st Phase of Godrej Waterside - commercial project in Kolkata, Godrej Woodsman Estate - a residential project in Bangalore and Godrej Coliseum in Mumbai. At the end of 2009-10, the completed developed area of GPL stood at 7.55 mn sq. ft. compared to 3.63 mn sq. ft. in 2008-09. During the year GPL successfully launched mid-income residential projects in Ahmedabad and Kolkata and it commenced operations in Chandigarh, Chennai and Mangalore.

GPL launched a state-of-the art township project, Godrej Garden City in Ahmedabad in March 2010. It is one amongst 16 founding projects of the Climate Positive Development Program, a Clinton Climate Initiative (CCI) program that will support the development of large-scale urban projects that demonstrate cities can grow in ways that are “Climate Positive.” Climate Positive real estate developments will strive to reduce the amount of on-site CO2 emissions to below zero. The project received an overwhelming response, the fi rst phase has been entirely booked within 10 days of its launch.

Godrej International Limited (GINL):

GINL trades worldwide in vegetable oils. GINL’s turnover increased by about 4% to US$ 120.27 million from US$ 115.50 million whilst profi ts increased by about 11% to US$ 1.53 million from US$ 1.38 million. The company improved its turnover and profi ts despite diffi cult markets and lower unit value of vegetable oils. As the world economy recovers, the company should continue to do well.

Godrej Hershey Limited (GHL):

Your Company holds a 43.4% stake in GHL. During the year under review, beverages grew 8% over the previous year and chocolate syrup grew 82% over the previous year. The gross margin was under pressure due to unprecedented rise in commodity prices particularly, sugar, glucose and dairy products. There were some major cost saving projects undertaken that yielded benefi ts during this year.

Nutrine Confectionery Company Limited (NCCL):

NCCL, a 100% subsidiary of GHL, is a major player in confectionery business in India. Its product portfolio includes strong brands such as MahaLacto, Nutrine Eclairs, Koko Naka, Honey Fab, Aam Ras, Aasay, SuperStar and Gulkand. Nutrine Lollipop was re-launched with an innovative packaging that provided the much needed momentum to the brand thereby doubling its sales. Nutrine Froot Shoot was re-launched with a modern and contemporary packaging to appeal more to the kids and upgrade the brand to justify Rs. 2/- price point. Nutrine Chatkeeli Imli was launched in Q4 which marked the move of GHL into spicy / tangy segment of fruit candies. This market contributes to about 30% of fruit confectionary and is growing at a very healthy rate.

For the fi rst time, a customer relationship program was held for Maha Lacto in which over 2,000 channel partners were invited in a ‘Meet & Greet’ Dhoni event. This was held in Chennai and turned out to be a huge hit with the wholesalers and distributors who participated in the same.

Apart from this, a consumer promotion was launched in which kids were invited to meet their idol – M.S. Dhoni. This promotion

saw an overwhelming response in key states leading to a jump in sales post the event.

Godrej Consumer Products Limited (GCPL):

GCPL is one of the leading companies in the FMCG sector with a presence in the Personal and Household Care business. During the year under review the company has endeavored to build on its strong foundation and to create an even stronger future. The year has seen the introduction of many new products combined with several other growth initiatives which included a focused expansion into the rural and interior regions. GCPL’s new product introductions span all the company’s categories comprising soaps, hair colourants, toiletries and a new range of hand hygiene products. All these launches have been after a rigorous amount of research and interaction with the target consumer.

In the soaps business GCPL introduced two new variants of Godrej No. 1 namely ‘Lime and Aloe Vera’ and ‘Moisturising soap’ with nourishment of Milk Cream & Almonds. With this the Godrej No. 1 portfolio now comprises nine variants. Godrej No. 1 is one of the three chosen power brands of GCPL and is today valued at over Rs. 500 crore. During the year, Godrej No. 1 maintained its leadership position in the States of Uttaranchal, Punjab, Himachal, and Gujarat and has emerged as the leader in Uttar Pradesh as well.

In the hair colourants business, GCPL re-launched its ‘Godrej Expert Hair colour’ brand during the year. This is GCPL’s power brand. Godrej Expert Colour is now available in liquid form as well as powder form. In Renew brand, GCPL launched Godrej Renew’s Ravishing Reds Collection with two new shades, Wine Red and Plum Crazy. Both these new launches have been very well liked.

GCPL’s international operations too performed encouragingly especially on the back of the ‘One Africa’ program which enabled it to derive numerous synergies across the continent and thereby strengthen GCPL’s presence. Keyline brands’ key offerings, namely the ‘Cuticura’ Hand Hygiene range, ‘Bio-oil’, P20 performed strongly. In South Africa ‘Inecto’ Powder Hair Colours have been relaunched. ‘Cuticura’ Hand Hygiene range, Godrej Expert Hair Colour and Godrej Nupur Mehendi were launched in the GCC and the Middle East in the current year.

GCPL acquired 49% stake in Godrej Sara Lee Limited (GSLL), an unlisted joint venture between the Godrej Group and Sara Lee Corporation USA earlier during the year. Subsequently in, May 2010 it entered into an agreement to acquire the remaining 51% stake. GSLL has a range of products that are complementary to GCPL’s existing offerings and there is signifi cant potential to derive synergies from the combined operations. GCPL has also been able to acquire strong, local, personal and household care brand in key emerging markets. It has acquired Megasari, a leading FMCG player in household care sector in Indonesia and has agreed to acquire Tura, a leading personal care player in Nigeria.

Financial Performance of GCPL

On a consolidated basis, GCPL registered a net income of Rs. 2,088.50 crore as compared to Rs. 1,433.13 crore in the previous year and GCPL’s profi t after tax increased by 96% from Rs. 173.26 crore in the previous year to Rs. 339.59 crore in the current year. GCPL has paid a total dividend at the rate of Rs. 4.25 per equity share of face value Re. 1.

Godrej Hygiene Care Limited (GHCL)

The Board of Directors of your Company, at its meeting held in May 2009, approved a scheme for the merger of GHCL a 100% subsidiary of your Company, into Godrej Consumer Products Limited (GCPL).

The scheme has been approved by the Hon’able High Court, Bombay in October 2009. The Appointed date of the merger is June 1, 2009 and the assets and liabilities of GHCL stands transferred to and vested in GCPL from that date. Pursuant to the said scheme of arrangement, 51,07,125 equity shares held by GHCL in Godrej Sara Lee Limited, stood transferred to and vested in GCPL and your Company received 209,39,409 equity shares of GCPL in lieu thereof as per the terms of the Scheme of Arrangement. 25% of these shares are locked in till November 2012.

FINANCIAL POSITION

The fi nancial position of your company continues to be sound.

The loan funds at the end of the year stand at Rs. 547.61 crore as compared to Rs. 600.96 crore at the end of the previous year. The debt equity ratio is 0.52 as compared to 0.57 last year.

Your Company continues to hold the topmost rating of A1+ from ICRA for its commercial paper program (Rs. 140 crore) (enhanced from Rs. 100 crore). ICRA has also assigned an A1+ rating for its short term debt instruments/other banking facilities (Rs. 595 crore) (enhanced from Rs. 570 crore). This rating of ICRA represents highest-credit quality carrying lowest-credit risk. ICRA also assigned LAA rating for long-term debt, working capital and other banking facilities (Rs. 370 crore) (enhanced from Rs. 330 crore). This rating represents high-credit quality carrying low- credit risk.

MANUFACTURING FACILITIES

The Chemicals Division of your Company has manufacturing facilities at Vikhroli and Valia. Effective January 1, 2010, leadership across both the factories has been integrated with one head for manufacturing and engineering services.

Vikhroli:

Vikhroli factory has successfully implemented OHSAS 18001: 2007 standards last year.

Post implementation of OHSAS 18001: 2007, surveillance audit of the Integrated Management System (Quality Management Systems-ISO 9001:2000, Environment Management Systems-ISO 14001:2004 and Occupational Health & Safety Assessment Series- OHSAS 18001:2007), was conducted by Bureau Veritas.

The factory has been re-certifi ed for the Integrated Management System in which ISO 9001:2000 has been upgraded to ISO 9001:2008 standards during last year.

Valia:

Valia factory has successfully recertifi ed for ISO-14001:2004 & ISO-9001:2008 upgradation after surveillance audit conducted by Bureau Veritas to check the effectiveness and improvements under the system and on environment and quality front. The factory is recommended for continuation of both certifi cates. This factory has successfully implemented cost effective separation of C8, C10, C12 and C14 alcohols.

Vegoils Division:

This Division continues as a contract processor of edible oils and vanaspati. The division recorded a turnover of Rs. 2.44 crore as against Rs. 2.45 crore in the previous year.

RESEARCH AND DEVELOPMENT

Activities have been initiated to develop new process/modify existing processes for the manufacturing of premium quality fatty acids from economy grade raw materials for high value

fractionated fatty acids for the polymer, oilfi eld and lubricant industries. Parallel to these activities, the R&D department has taken up initiatives to develop customers for specialty surfactants and glycerin for oral care and personal care products to meet their specifi c needs.

INFORMATION SYSTEMS

Your Company had entered into a strategic alliance with Hewlett Packard (HP) for a comprehensive IT outsourcing and transformation project. The transition to HP services has been smooth and without any disruption to business operations.

The customer relationship management package (eCRM) has been re-launched on the robust SAP platform. The domestic portal, named Rishta has been rolled out to 150 plus customers. The international eCRM was launched in February 2010 and already has 50 plus key customers.

EMPLOYEE STOCK OPTION PLAN (ESOP):

During the fi nancial year 2009-10, 20 employees of the Company were granted ESOPs based on their leadership responsibility and potential:

Date of Grant of ESOP No. of ESOP No. of employees August 10, 2009 8,60,000 20

Disclosure in compliance with clause 12 of the Securities and Exchange Board of India (Employees Stock Purchase Scheme) Guidelines, 1999 is given in Annexure B attached and forms a part of this report.

GROUP FOR INTERSE TRANSFER OF SHARES

As required under Clause 3(1) (e) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, persons constituting Group (within the meaning as defi ned in the Monopolies and Restrictive Trade Practices Act, 1969) for the purpose of availing exemption from applicability of the provisions of Regulation 10 to 12 of the aforesaid SEBI Regulations are given in Annexure C attached herewith and forms a part of this Report.

HUMAN RESOURCE DEVELOPMENT AND INDUSTRIAL RELATIONS

Your Company encourages a culture that develops and empowers people, promotes team building, nurtures new ideas and uses information technology to support HR processes and initiatives. These efforts were recently recognized when the Company received an award for “Excellence in HR through Technology” at the World HRD Congress held in Mumbai on February 13, 2010.

Your Company has always emphasized on quality and its employees are encouraged to get involved in the never-ending process of improving quality through Total Quality Management and quality circles. Two quality circles from the Vikhroli Factory of the Company were recognized as “Excellent Quality Circles” by the Quality Circle Forum of India in the 23rd National Convention on Quality Circles held in Bangalore from 19-21 December 2009.

Industrial relations at all plant locations remained harmonious. Regular structured safety meetings were held with employees and safety programmes were conducted for them throughout the year.

Inclusiveness

It has been the endeavour of your Company to provide opportunities to socially and economically underprivileged persons, particularly those belonging to Scheduled Castes / Scheduled Tribes and physically challenged individuals. Your Company supports

underprivileged children for education through scholarships and mid-day meal programs at the school level.

Your Company gave permanent employment to fi ve physically challenged persons.

CORPORATE SOCIAL RESPONSIBILITY

Your Company as part of the Godrej group aims to build a brighter, more sustainable India.

During the year your Company undertook various activities as a part of its Corporate Social Responsibility. Your Company instituted the Indian chapter of ‘Table For Two’ initiative at the World Economic Forum’s India Summit in December last year. This initiative was targeted at addressing hunger and malnutrition in the developing world by combining our organization’s tradition of serving society and your individual involvement.

Your Company continues to support Heroes AIDS Project (HAP). HAP is a national HIV/AIDS initiative launched in July 2004 to work with media organizations and societal leaders in India. It seeks to develop coordinated campaigns to address the spread of HIV/AIDS and reduce stigma and discrimination by infl uencing public perception and policy through two platforms, advocacy and communications.

Under the Teach for India initiative, your Company has sponsored one Company employee for a period of 2 years under Teach for India Fellowship program which is run by Teach for India, an organization established in 2008 to bridge the educational divide and increase the participation of highly skilled leaders in the education sector of India. Under this program, the sponsored employee is committed to teach for two years in low-income urban and rural public schools. During the year, your Company donated fl y catcher machines through Lions Club to various hospitals, orphanages, old age homes, home for blind, BMC run schools etc. Your Company distributed scholarships to Scheduled Caste (SC) / Scheduled Tribes (ST) primary school children covering three schools and also distributed note books to SC/ST primary school children in village Kanerao.

ENVIRONMENT AND SOCIAL CONCERN

Your Company continues its efforts for the betterment of the environment and conservation of scarce natural resources.

Your Company planted 4,500 trees in the Company’s premises at Valia and environmental training sessions were conducted by Company’s personnel at ITI Valia and Anchor Institute, DDIT, Ahmedabad and Ankleshwar.

Your Company continued “Rain water harvesting” initiatives undertaken at its factory and in the staff quarters at Vikhroli. So far 18,500 m3 of water has been collected at Vikhroli factory and staff quarters for the Year 2009-10. This process has resulted in saving water and consequently, the costs, thereof.

To prevent pollution to environment, efforts are made to convert waste from the factories into an environment friendly product and then dispose off the same safely. Your Company continued its arrangement with Trans Thane Creek Waste Management Association for the treatment of solid waste being generated at the Company’s factory at Vikhroli. More areas of wasteland have been converted into garden using water from ETP.

As part of your Company’s continued commitment to conserve natural resources, and also to ward off the ever increasing water shortage, the Company has successfully commissioned a Reverse Osmosis plant to upgrade ETP treated water to boiler feed water resulting into effective recycling of ETP treated water.

Vikhroli factory continues to convert the bio degradable waste into bio compost with the help of an NGO. The Vikhroli factory focused on waste elimination and also continued energy conservation measures.

The Valia factory has improved / modifi ed in Generation / Transfer/ Treatment / Monitoring and disposal pattern of waste water and treated water. Achieved signifi cant reduction of main waste water pollutant parameter i.e. COD Value at inlet of ETP compared to last year and streamlined/optimized the operation and treatment capability of ETP.

FIXED DEPOSITS

Your Company continues to accept public deposits for 13, 24 and 36 months’ tenure. The Fixed Deposits scheme has received an overwhelming response and the management of the company is thankful to all the investors for participating in the scheme and for the trust reposed in the company. During the year ended March 31, 2010, deposits aggregating to Rs. 76.38 crore have been mobilised and deposits aggregating to Rs. 0.60 crore have been repaid on maturity. The Company has no overdue deposits other than unclaimed deposits.

DEPOSITORY SYSTEM

Your Company’s equity shares are available for dematerialisation through National Securities Depository Limited and Central Depository Services (India) Limited. As of March 31, 2010, 99.68 % of the equity shares of your Company were held in demat form.

BUYBACK

Pursuant to the resolution passed by the Board of Directors of the Company and in accordance with the provisions of the Companies Act, 1956 and the Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998, the Company made a Public Announcement to Buyback 57,00,000 equity shares (“Maximum Offer Shares”) of Re. 1 each, from the existing owners of equity shares other than Persons in Control, at a price not exceeding Rs. 275 (Rupees Two Hundred and Seventy Five Only) per equity share (the “Maximum Offer Price”) payable in cash, for an aggregate amount not exceeding Rs. 99 crore (“Maximum Offer Size”). During the year your Company bought back and extinguished 21,33,710 equity shares of face value Re. 1 each. The total amount invested in the Buyback is Rs. 28,86,58,132/- representing 29.16% of the Maximum Offer Size. The change in the paid up capital of the Company consequent to the Buyback is given hereunder :-

Particulars No. of shares

Equity share capital before Buyback (i.e. on May 319,758,602

24, 2009)

Less: Equity Shares bought back and extinguished 2,133,710

(from May 25, 2009 to July 28, 2009 )

Equity share capital after Buyback (i.e. on July 317,624,892

29, 2009)

DEVELOPMENT OF PROPERTY AT VIKHROLI

During the year your Company has entered into a Memorandum of Understanding (MoU) with Godrej & Boyce Mfg. Co. Ltd. and Godrej Properties Ltd. for development of the property at Vikhroli.

The binding MoU provides for setting up of suitable Special Purpose Vehicle(s) to execute joint development of the property as also the commercial terms for such development including the sharing of costs and revenues/profi t between your Company and GPL, who

would be developing the said property. The MoU is subject to all the parties obtaining appropriate corporate and statutory permissions/ consents to execute the defi nitive agreements inter-se and the Company obtaining appropriate shareholders’ approval.

DIRECTORS

In accordance with Article 127 of the Articles of Association of the Company, Mr. F. P. Sarkari, Mr. S.A. Ahmadullah, Mr. A.B. Godrej, Mr. K.K. Dastur retire by rotation at the ensuing Annual General Meeting and offer themselves for reappointment. Mr. V.N. Gogate, also retires by rotation at this Annual General Meeting. However in view of his advanced age, Mr. V.N. Gogate has not offered himself for reappointment. Mr. V.N. Gogate has been on the Board of the Company since 1995 and the Board records its appreciation for the contribution made by him during his tenure with the Company.

AUDITORS

You are requested to appoint Auditors for the current year and to authorise the Board to fi x their remuneration. The retiring auditors, Kalyaniwalla and Mistry, Chartered Accountants, are eligible for reappointment. A certifi cate from the Auditors has been received to the effect that their reappointment, if made, would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.

AUDIT COMMITTEE

The Audit Committee, which was constituted pursuant to the provisions of Section 292A of the Companies Act, 1956 and the listing agreement, has reviewed the Accounts for the year ended March 31, 2010. The members of the Audit Committee are Mr. F. P. Sarkari (Chairman), Mr. V.N. Gogate, Mr. S.A. Ahmadullah and M r. K.N. Petigara, all Independent Directors. The Board of Directors of the Company at its meeting held on May 26, 2010 has appointed Mr. K.K. Dastur as an Audit Committee member with immediate effect.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the provisions contained in Section 217(2AA) of the Companies Act, 1956, the Directors of your Company confi rm:

a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and no material departures have been made from the same;

b) that such accounting policies have been selected and applied consistently, and such judgments and estimates have been made 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 fi nancial year and of the profi t or loss of the Company for that period;

c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company, for preventing and detecting fraud and other irregularities;

d) that the annual accounts have been prepared on a going concern basis.

CORPORATE GOVERNANCE

As required by the existing clause 49 of the Listing Agreements with the Stock Exchanges, a detailed report on Corporate Governance is included in the Annual Report. The Auditors have certifi ed

the Company’s compliance of the requirements of Corporate Governance in terms of clause 49 of the Listing Agreement and the same is annexed to the Report on Corporate Governance.

ADDITIONAL INFORMATION

Annexure D to this Report gives information in respect of Conservation of Energy, Technology absorption and Foreign Exchange Earnings and Outgo, required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 and forms a part of the Directors’ Report.

Information as per Section 217(2A) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 forms a part of the Directors’ Report. As per the provisions of Section 219(1) (b) (iv) of the Companies Act, 1956, the Report and Accounts are being sent to the Shareholders of the Company, excluding the statement of particulars of employees u/s 217(2A) of the Companies Act, 1956. Any shareholder interested in obtaining a copy of the same may write to the Company Secretary at the registered offi ce of the Company.

The Notes to the Accounts referred to in the Auditors’ Report is self-explanatory. However in respect of the qualifi cations in the Audit Report, we state as follows:

Loans and Advances include Rs. 10.33 crore (Previous year Rs. 10.33 crore) advanced by the Company to certain individuals against pledge by way of deposit of equity shares of Gharda Chemicals Ltd. The Company has enforced its security and lodged the shares for transfer in its name, however, the transfer application has been rejected by Gharda Chemicals Ltd. and the Company fi led an appeal before the Company Law Board against the rejection. The investee company had in the meanwhile, moved the Bombay High Court and the Court remanded the matter back to CLB. The CLB has advised that the parties may approach the Bench after fi nal disposal of the suit fi led by the investee company and the application made by minority shareholders under section 397/398 before the Hon’ble High Court. The Company has fi led an appeal with the Hon’ble High Court against the order of the Company Law Board under Section 10 F of the Companies Act 1956, which has been admitted.

The recoverability of the advance is contingent upon the transfer and/or disposal of the said shares. It is the opinion of the management that the underlying value of the said shares is substantially greater than the amount of the loan.

ACKNOWLEDGEMENT

Your Directors thank the Union Government, the Governments of Maharashtra and Gujarat as also all the Government agencies, banks, fi nancial institutions, shareholders, customers, employees, fi xed deposit holders, vendors and other business associates, who, through their continued support and co-operation, have helped as partners in your Company’s progress.

For and on behalf of the Board of Directors

A.B. Godrej Chairman

Mumbai, June 4, 2010

Find IFSC