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Directors Report of Housing Development & Infrastructure Ltd.

Mar 31, 2016

Dear Members,

The Directors have pleasure in presenting the 20th Annual Report of the Company together with the "Management Discussion and Analysis Report", "Corporate Governance Report" and "Audited Financial Statements" for the Financial Year ("F.Y.") ended March 31, 2016.

FINANCIAL PERFORMANCE

Your Company''s performance during the F.Y. ended March 31, 2016 as compared to the previous F.Y. is summarized below:

(Rs. In Lacs)

Particulars

Standalone

Consolidated

2015-16

2014-15

2015-16

2014-15

Gross sales and other receipts

1,19,109.46

1,09,093.36

1,19,247.09

1,08,312.21

Profit before finance cost, depreciation, amortization and taxation

66,122.14

70,118.58

80,814.81

86,656.27

Finance Cost

36,720.43

38,694.07

51,228.25

55,344.49

Depreciation and Amortization

547.60

671.26

575.59

1,531.95

Operational profit before tax

28,854.11

30,753.25

29,010.97

29,779.83

Less: Tax Expenses

2,357.86

8,119.90

2,407.37

7,916.25

Less: Minority Interest

N.A.

N.A.

(9.86)

(1.55)

Profit for the year

26,496.25

22,633.35

26,613.46

21,865.13

Balance brought forward

76.72

3,791.77

(36,449.74)

(34,329.08)

Add: Other adjustments

7,717.59

351.60

7,693.54

2,714.21

Profit available for appropriation

34,290.56

26,776.72

(2,142.74)

(9,749.74)

Less: Transferred to Debentures Redemption Reserve

5,424.09

26,700.00

5,424.09

26,700.00

Closing Balance

28,866.47

76.72

(7,566.83)

(36,449.74)

Net Worth

10,99,719.81

10,65,505.97

11,14,775.12

10,80,468.12

STATE OF COMPANY''S AFFAIRS AND PERFORMANCE REVIEW

- The Turnover of the Company increased by 9.18 % and stood at Rs. 1,19,109.46 lacs as against Rs. 109,093.36 lacs in the previous year.

- The Company''s Profit from operations for the year ended March 31, 2016, decreased by 6.18 % to Rs. 28,854.11 lacs as against Rs. 30,753.25 lacs in the previous year.

- The Net Profit for the year has increased by 17.07 % to Rs. 26,496.25 lacs as against Rs. 22,633.35 lacs in previous year.

- During the F.Y., Company''s Debt including Non-Convertible Debentures ("NCD") has been repaid aggregating to Rs. 62,225.23 lacs and Debt Service Ratio is 0.92.

MANAGEMENT DISCUSSION AND ANALYSIS

A detailed review of the operations, performance and future outlook of the Company and its businesses is given in the Management Discussion and Analysis Report, which forms part of this Report.

SUBSIDIARY COMPANIES

As at March 31, 2016, your Company has following subsidiaries:

Sr. No.

Name of Subsidiary

1

Blue Star Realtors Private Limited

2

BKC Developers Private Limited

3

Excel Arcade Private Limited

4

Guruashish Construction Private Limited

5

HC Infracity Private Limited

6

Lashkaria Construction Private Limited

7

Mazda Estates Private Limited

8

Privilege Power and Infrastructure Private Limited

9

Ravijyot Finance and Leasing Private Limited

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 ("the Act"), read with relevant rules of Companies (Accounts) Rules, 2014, the Company has prepared its consolidated financial statement including all of its subsidiaries, which is forming part of this report. A statement containing salient features of financial statements of subsidiary companies in Form AOC 1 is included in the Annual Report at Page No. 94.

Pursuant to provisions of Section 136 of the Act, the separate audited financial statements in respect of each of the subsidiary companies shall be kept open for inspection at the Registered Office of the Company on all working days between 10:00 a.m. to 12:00 noon, for a period of 21 days before the date of the Annual General Meeting ("AGM"). Your Company will also make available these documents upon a written request by any Member of the Company interested in obtaining the same. The separate audited financial statements in respect of each of the subsidiary companies is also available on the website of your Company at www.hdil.in.

DIVIDEND

In view of the current market and industry scenario, your Board has been actively pursuing paring of its debt and optimising its land banks, your Directors have not recommended payment of any Dividend for the F.Y. ended March 31, 2016.

DEBENTURES

During the F.Y., your Company has not issued any Debentures. However, out of the total NCD issued in the earlier years by the Company, during the F.Y., there has been repayment of NCD aggregating to Rs. 43,651.78 lacs.

SHARE CAPITAL

The paid-up equity share capital of the Company as at March 31, 2016, was Rs. 41,900.40 lacs. During the F.Y., there was no change in the issued, subscribed and paid up share capital of the Company.

The equity shares of your Company continue to be listed on BSE Limited and National Stock Exchange of India Limited.

RESERVES

As per requirements of the provisions of Section 71 of the Act read with the Companies (Share Capital and Debentures) Rules, 2014, your Company has transferred Rs. 5,424.09 lacs to Debenture Redemption Reserve.

FIXED DEPOSITS

Your Company did not hold any public deposits at the beginning of the year, nor it has accepted any deposits from the public during the F.Y., within the meaning of Section 73 of the Act and the Companies (Acceptance of Deposits) Rules, 2014.

EXTRACT OF ANNUAL RETURN

An extract of the Annual Return of the Company, as prescribed under Section 92(3) of the Act and Companies (Management and Administration) Rules, 2014, framed there under, is annexed as Annexure ''A''.

DIRECTORS

Due to sad demise after brief illness, Mr. Shyam Sunder Dawra ceased to be a Non-Executive Independent Director of the Company with effect from February 10, 2016. The Board of Directors ("the Board") place on record its appreciation for the significant contribution made by him during his tenure as a Director of the Company.

On submission of declaration made by Mr. Ashok Kumar Gupta under Section 149(7) of the Act and in accordance with the provisions of the Act and on the basis of recommendation of Nomination and Remuneration Committee, the Board at its Meeting held on May 28, 2016, had appointed Mr. Ashok Kumar Gupta as a Non-Executive Independent Director of the Company.

Your Company has received notice in writing pursuant to Section 160 of the Act from the Member along with deposit of Rs. 1,00,000/signifying his intention to propose the candidature of Mr. Ashok Kumar Gupta as Non-Executive Independent Director of the Company at the ensuing AGM of the Company and his appointment is hereby proposed for the approval of the Members.

The above appointment forms part of the Notice of the ensuing twentieth AGM and the Resolution is recommended for your approval. Brief Profile of Mr. Ashok Kumar Gupta as required under the Regulation 36 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations,

2015 ("Listing Regulations"), forms part of the Notice of the ensuing twentieth AGM.

Your Company received declaration from all the Independent Directors of the Company confirming that they meet the criteria of Independence as prescribed by Section 149(6) of the Act.

The terms and conditions of the appointments of Independent Directors have been placed on the website of the Company www.hdil.in.

Your Company has conducted the familiarization programme for all its Directors covering the matters as specified under Regulation 25(7) of the Listing Regulations, details of which has been hosted on the Company''s website at http://www.hdil.in/pdf/policies/ familiarisation-programme-for-independent-directors.pdf.

DIRECTORS'' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) read with Section 134(5) of the Act:

a) in the preparation of the annual accounts for the year ended March 31, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b) 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 as at March 31, 2016 and of the profit of the Company for the year ended on that date;

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

d) the Directors have prepared the annual accounts on a going concern basis;

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

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

CORPORATE GOVERNANCE

Your Company has its Corporate Governance philosophy on transparency, accountability, values and ethics, which forms an integral part of the Management''s ongoing activity towards achieving excellence, growth and value creation. Your Company is committed to highest standards of Corporate Governance and disclosure practices to ensure that its affairs are managed in the best interest of all stakeholders.

A report on Corporate Governance together with a certificate received from M/s. Thar & Co., Chartered Accountants, Statutory Auditors of the Company confirming the compliance with the provisions of Corporate Governance as stipulated in Listing Regulations is given separately which forms part of this Report. (Refer Page No. 32).

NUMBER OF MEETINGS OF THE BOARD

The Board met on various occasions to discuss and decide various affairs, operations of the Company and to supervise and control the activities of the Company. The schedule of the Board / Committee Meetings to be held in the forthcoming F.Y. will be circulated to the Directors in advance to enable them to plan their schedule for their effective participation in the Meetings.

During the F.Y., the Board met four (4) times viz. on May 15, 2015, August 10, 2015, November 7, 2015 and February 13, 2016.

Detailed information on the Meetings of the Board is included in the report on Corporate Governance, which forms part of this Annual Report. (Refer Page No. 32).

COMMITTEES OF THE BOARD

Your Company has following committees of the Board as a part of good corporate governance practices and which are in compliance with the requirements of the relevant provisions of applicable laws and statutes:

- Audit Committee;

- Nomination and Remuneration Committee;

- Stakeholders Relationship Committee;

- Risk Management Committee;

- Corporate Social Responsibility Committee("CSR Committee");

- Finance Committee and

- Project Committee

The details with respect to the compositions, terms of reference including powers, roles etc. of relevant committees are given in detail in the ''Report on Corporate Governance'' of the Company which forms part of this Annual Report.

AUDIT COMMITTEE

The Audit Committee comprises of the following Directors:

Mrs. Sandhya Baliga - Chairperson

Mr. Ashok Kumar Gupta - Member Mr. Lalit Mohan Mehta - Member *Mr. Shyam Sunder Dawra - Member Mr. Raj Kumar Aggarwal - Member

*Due to sad demise, Mr. Shyam Sunder Dawra ceased to be the Member of the Committee w.e.f. February 10, 2016.

All the recommendations made by the Audit Committee were accepted by the Board.

STATUTORY AUDITORS

M/s. Thar & Co., Chartered Accountants (Firm Registration No. 110958W), Statutory Auditors of your Company, who retire at the ensuing AGM of the Company are eligible for appointment.

The Company has received a letter from M/s. Thar & Co., Chartered Accountants, to the effect that their appointment, if made, would be in accordance with the provisions of Section 139 of the Act and that, they are not disqualified for such appointment within the meaning of Section 141 of the Act. As required under Listing Regulations, the Auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

EXPLANATION ON AUDITORS'' REPORT

As regards the observation by the Auditor in the Auditor''s Report regarding delay in payment of Statutory dues, subsequently the Company has paid TDS of Rs. 10 lacs and arrears of interest on Service Tax and VAT will be cleared upon completion of assessment of the respective years.

In respect of Income Tax demands, your Directors'' would like to state that the Company has filed appeal against the demand raised by the Assessing officer and the same is pending for disposal at various stages. Your Company is confident based on the advice of Advisors that the outcome of the appeals will be decided in favor of the Company.

There are no qualifications, reservations, adverse remarks or disclaimers made by Statutory Auditors in their Report dated May 28, 2016, on the financial statements of the Company for F.Y. 2015-16.

SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. SG & Associates, Company Secretaries (C.P No. 5722) to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as Annexure ''B''.

There are no qualifications, reservations, adverse remarks or disclaimers made by Secretarial Auditors, in their Report dated May 21, 2016, on the Secretarial and other related records of the Company for the F.Y. 2015-16.

COST AUDITORS

In pursuance of Section 148 of the Act, read with the Companies (Cost Records and Audit) Rules, 2014, as amended from time to time, the Board, on recommendation of Audit Committee, has appointed M/s. Ketki D. Visariya & Co., Cost Accountants (Firm Registration No. 00362), as the Cost Auditors to conduct the Cost Audit for the F.Y. 2016-17 at a remuneration of Rs. 1,00,000/- and reimbursement of out of pocket expenses plus service tax as applicable.

As required under the Act, ratification by the Members pertaining to the remuneration payable to the Cost Auditors forms part of the Notice of the ensuing AGM and the respective Resolution is recommended for your consideration.

INTERNAL FINANCIAL CONTROL

Your Company has in place adequate internal financial controls with reference to financial statements and to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT BY THE COMPANY

Pursuant to Section 186 of the Act, particulars of the loans given, investment made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by such recipient are provided under respective notes in financial statements.

RELATED PARTY TRANSACTIONS

All transactions entered with Related Parties during the F.Y. were on arm''s length basis and in the ordinary course of business and that the provisions of Section 188 of the Act are not attracted and hence the disclosure in form AOC-2 is not required.

During F.Y., there are no material related party transactions with Promoters, Directors or Key Managerial Personnel ("KMP"). The Company has in place a policy on Materiality of and Dealing with Related Party Transactions for the purpose of identification and monitoring of such transactions. Suitable disclosures as required under AS-18 have been made in Note 30 of the Notes to the financial statements.

Pursuant to Regulation 23 of the Listing Regulations, the Company has in place a Policy on dealing with Related Party Transactions, which has been hosted on Company''s website at http://www.hdil.in/pdf/policies/policy-on-materiality-of-and-dealing-with-related-party-transactions.pdf.

Policy for determining ''Material'' Subsidiaries

As required under Regulation 16(1)(c) of the Listing Regulations, the Company has in place a Policy for Determining ''Material'' Subsidiaries, which has been hosted on Company''s website at http://www.hdil.in/pdf/policies/policy-for-determining-material-subsidiary.pdf

RISK MANAGEMENT

Pursuant to Regulation 21 of Listing Regulations, your Company has in place a Risk Management Committee which identifies, evaluates, manages and monitors the risks that can impact the Company''s ability to achieve its strategic and financial objectives and monitors risk tolerance limits, reviews and analyzes risk exposure related to specific issues and provides oversight of risk across the organization.

The Board has in place a Risk Management Policy to identify and assess the key risk area, monitor and report compliance and effectiveness of the policy and procedure.

VIGIL MECHANISM

Your Company has a Vigil Mechanism for their Directors and employees to report their genuine concerns or grievances and in order to report such concerns or grievances, the Company has formal Whistle Blower Policy in place.

Your Company assures cognizance of complaints made and suggestions given by the employees. Even anonymous complaints will be looked into and whenever necessary, suitable corrective steps will be taken.

The Whistle Blower Policy, provides for adequate safeguards against victimization of persons who use such mechanism and also provides direct access to the Chairperson of the Audit Committee. The Whistle Blower Policy have been put up on the Company''s Website at www.hdil.in.

NOMINATION AND REMUNERATION POLICY

The Board has in place a policy which lays down criteria for selection and appointment of Board Members. The policy also lays down a framework in relation to remuneration of Directors, KMP and Senior Management of the Company. The Policy also includes the criteria for determining qualifications, positive attributes and independence of Directors.

The detailed policy is annexed to the Report on Corporate Governance, which forms part of this Annual Report.

EVALUATION OF THE BOARD, ITS COMMITTEE AND INDIVIDUAL DIRECTORS

Pursuant to the provisions of the Act and Listing Regulations, the Board has carried out an annual evaluation of its performance, of the Directors individually as well as the evaluation of the working of its Committees. The manner in which the evaluation was carried out was explained in the Report on Corporate Governance, which forms part of this Annual Report.

PARTICULARS OF EMPLOYEES

Your Company recognizes its employees as its most valuable asset and it has built an open, transparent and meritocratic culture to nurture this asset.

Your Company has embarked on the journey of creating a High Performance Culture and has laid the foundation towards this.

Your Directors place on record their appreciation for the contributions made by the employees of the Company at all levels. Relations between employees and the Management continued to be cordial during the year.

The statement containing particulars of employees as required under Section 197(12) of the Act, read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms part of this report. In terms of Section 136 of the Act, the same is open for inspection at the Registered Office of your Company on all working days between 10:00 a.m. to 12:00 noon up to the date of the Meeting. Copies of this statement may be obtained by the Members by writing to the Company Secretary of your Company.

The ratio of the remuneration of each Director to the median employee''s remuneration and other details in terms of Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are forming part of this report as Annexure ''C''.

REPORT UNDER THE PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company is committed to providing and promoting a safe and healthy work environment for all its employees.

Your Company has in place a policy on ''Prevention of Sexual Harassment'' ("POSH") in line with the provisions of the Prevention of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed there under for prevention and redressal of complaints pertaining to sexual harassment at workplace, along with a structured reporting and redressal mechanism. The POSH Policy is displayed on the Company''s intra-net ''HDIL World''.

During F.Y. 2015-16, your Company has not received any complaint on sexual harassment.

INVESTORS'' RELATION AND GRIEVANCES

Investors'' relations have been cordial during the year. As a part of compliance, the Company has in place Stakeholders Relationship Committee to deal with the issues relating to investors. There were no investors'' grievances pending as on March 31, 2016. A confirmation to this effect has been received from the Company''s Registrar and Share Transfer Agent ("R&T").

CORPORATE SOCIAL RESPONSIBILITY ACTIVITIES

Your Company has in place a CSR Committee which is in compliance to the provisions of Section 135 of the Act, read with Companies (Corporate Social Responsibility Policy) Rules, 2014, which comprises of the following Directors:

1) 1Mr. Rakesh Kumar Wadhawan - Chairman

2) Mr. Sarang Wadhawan - Member

3) Mr. Lalit Mohan Mehta - Member

4) *Mr. Shyam Sunder Dawra - Member

*Due to sad demise, Mr. Shyam Sunder Dawra ceased to be a Member of the Committee w.e.f. February 10, 2016, pursuant to which the Board of Directors of the Company at its Meeting held on February 13, 2016, appointed Mr. Rakesh Kumar Wadhawan as the Chairman of the CSR Committee.

Your Company has also in place a Corporate Social Responsibility ("CSR") Policy which is available on the website of the Company at www.hdil.in.

The average Net Profit of the Company for last three F.Y. is Rs. 21,883.65 Lacs and accordingly the Company requires to spend Rs. 437.67 Lacs on CSR activities.

The Company has setup a trust in the name of ''HDIL Foundation'' with the objectives of starting and maintain educational institutions, open boarding houses and hostels for students, libraries, donations for working of educational institutions and charitable purpose, to establish hospitals, research laboratories and medical centres, general welfare and upliftment of poor and needy people, digging wells and providing drinking water, to organize seminars / meetings / camps for awakening of general masses, to give relief in the stress of famine / fire / tempest / cyclone / earthquake or other natural calamity.

The Company however has been initiated certain obligations through undertaking of SRA project, where social and economically backward people have been beneficial of these projects, in the following ways:

i. transportation facilities to the school going children of slum dwellers;

ii. providing additional safety measure to enhance security of labour at construction sites and

iii. free medical camps for the labourers and their families.

Further, your Company is irregular in paying of its statutory dues and financial commitments to the Banks and Financial Institutions, hence, the Board is of the view that CSR activities needs to be undertaken only after the Company has regularized in meeting all its obligations.

CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGICAL ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Information as required under Section 134(3)(m) of the Act read with the Companies (Accounts) Rules, 2014, for the year ended March 31, 2016, is as under:

CONSERVATION OF ENERGY

Your company is conscious about its responsibility to conserve energy, power and other energy sources wherever possible. We emphasis towards a safe and clean environment and continue to adhere to regulatory requirements and guidelines. The construction team under the guidance of expert engineers of the Company continuously strives and devises various means to conserve energy and identify methods for optimum use of energy.

Initiatives are taken for energy efficiency systems for Buildings in various phases like design, building and occupation by considering various options and appropriate measures for energy conservation which are stated as following:

- Zoning System and

- Passive solar Design. RESEARCH AND DEVELOPMENT

The Company has undertaken Research and Development ("R&D") activity in development of technology in the area of construction.

In today''s competitive market where it is obvious need to construct with optimum cost, reduced schedule while maintaining highest standard of quality, our Company is actively involved in R&D activities. Some of them are:

Optimization of Space:

Mechanical Car Parking

- DOKA formwork;

- ULMA formwork;

- MIVAN formwork;

- Installation of safety apparatus for emergency evacuation purpose in an unlikely event of hazard;

- Study, Analysis and use of various shuttering patterns for economy, conservation of time and better quality of work;

- Substitution of Diaphragm wall with sheet piling as shoring options;

- Study, Analysis and use of composite structure in place of conventional structure;

- Optimization of resources and their recycling for further use;

- Use of environment friendly materials and developing green building concept and

- Analysis and study of trade off among various services for optimization.

Emphasis is given on time, cost and quality and setting an efficient trade-off among these three variables of Project management in R&D efforts.

Angstrom Fire Escape Chutes

Initiatives for Sustainable Building Energy Conservation GREEN PAINTS FOR GREEN BUILDING:

Introduction:

Paints can have a major impact on the overall aesthetics of a space; sometimes more than even flooring and furnishing because of the enormous square footage of the coverage.

According to the US Environmental Protection Agency (USEPA), 9% of the airborne pollutants creating ground level ozone come from the VOC''s (Volatile Organic Compound) in the Paint. VOC refers to a class of chemicals which evaporates easily at room temperature. When these VOCs off-gas, they may cause a variety of health problems like nausea, dizziness, irritation of eyes and respiratory tract, and more serious illness like heart, lung or kidney damage and cancer.

Low and Zero VOC paints have little or no smog-forming emission. Use of high VOC content materials can cause illness and may decrease occupant productivity. These problems result in increased expenses and liability for building owners, operators and insurance companies.

Benefits:

Using the Low VOC or Zero VOC paint we can eliminate the detrimental effect of ground level ozone on human health, agricultural crops, forests and ecosystem. Healthy occupants are more productive and have less illness- related absenteeism.

LED LIGHTS Introduction:

LEDs are light emitting diodes, are a technology that allows for extremely energy efficient and extremely long-lasting light bulbs. An LED light bulb can reduce energy consumption by 80-90% and last around 100,000 hours. They even light up faster than regular bulbs (which could save your life if there are LEDs in the brake lights of your car).

Ecologically Friendly:

LED lights are free of toxic chemicals. Most conventional fluorescent lighting bulbs contain a multitude of materials like e.g. mercury that are dangerous for the environment.

LED lights contain no toxic materials and are 100% recyclable, and will help you to reduce your carbon footprint by up to a third. The long operational life time span mentioned above means also that one LED light bulb can save material and production of 25 incandescent light bulbs. A big step towards a greener future.

Zero UV Emissions:

LED illumination produces little infrared light and close to no UV emissions.

Because of this, LED lighting is highly suitable not only for goods and materials that are sensitive to heat due to the benefit of little radiated heat emission, but also for illumination of UV sensitive objects or materials such as in museums, art galleries, archeological sites etc.

Security Systems:

The Company has following Security Systems at its office and site:

- Fire Alarm System and

- Water Curtain System TECHNOLOGICAL ABSORPTION

Your Company has not imported any technology. However, we believe and use information technology extensively in all spheres of our activities to improve efficiency levels.

FOREIGN EXCHANGE EARNINGS AND OUTGO

(Rs. In Lacs)

Year

2015-16

2014-15

Foreign exchange earnings

-

-

Foreign exchange outgo

233.23

123.56

PARTICIPATION IN THE GREEN INITIATIVE

Your Company continues to wholeheartedly participate in the Green Initiative undertaken by the Ministry of Corporate Affairs ("MCA") for correspondences by Corporate to its shareholders through electronic mode. All the shareholders who have not so far substituted / updated their e-mail id are requested to join the said program at sending e-mail of their preferred e-mail addresses to the R&T at raieev.kr@karvy.com or to the Company on info@hdil.in.

REGULATORY ACTION

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and future operations of the Company.

INFORMATION OF MATERIAL CHANGES AND COMMITMENTS

There are no material changes or commitments affecting the financial position of the Company which have occurred after March 31, 2016 and prior to May 28, 2016, being the date of this report.

CAUTIONARY STATEMENT

Statements in this Directors'' Report and Management Discussion and Analysis describing the Company''s objectives, estimates, expectations or predictions may be "forward-looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make difference to the Company''s operations including raw material availability and its price, pricing in the Company''s principle markets, changes in Government regulations, Tax regimes and economic developments within India.

APPRECIATION

Your Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by the employees of the Company and its Associates at all levels and wish to convey their appreciation to the Banks, Financial Institutions, Government Authorities, Customers and other Stakeholders for the excellent assistance and co-operation received and wish to place on record their gratitude to the Members for their trust, support and confidence reposed in the Company.

For and on behalf of the Board of Directors

Rakesh Kumar Wadhawan

Executive Chairman

Place: Mumbai

Date: May 28, 2016


Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting the 19th Annual Report of the Company together with the "Management Discussion and Analysis Report", "Corporate Governance Report" and "Audited Financial Statements" for the Financial Year ("F.Y.") ended March 31, 2015.

FINANCIAL PERFORMANCE

Your Company's performance during the F.Y. ended March 31,2015 as compared to the previous F.Y. is summarised below:

(Rs. In Lacs)

Particulars Standalone

2014-15 2013-14

Gross sales and other receipts 109,093.36 94,044.27

Profit before finance cost, depreciation, amortisation and 70,118.58 77,297.12

taxation

Finance Cost 38,694.07 50,964.06

Depreciation and Amortization 671.26 780.06

Operational profit before tax 30,753.25 25,553.00

Less: Tax Expenses 8,119.90 1,068.06

Less: Minority Interest NA NA

Profit for the year 22,633.35 24,484.94

Balance brought forward 3,791.77 3,846.94

Add: Other adjustments 351.60 (140.11)

Profit available for appropriation 26,776.72 28,191.77

Less: Transferred to Debentures Redemption Reserve 26,700.00 24,400.00

Closing Balance 76.72 3,791.77

Net Worth 1,065,505.97 1,042,521.02

Particulars Consolidated

2014-15 2013-14

Gross sales and other receipts 108,312.21 95,364.41

Profit before finance cost, depreciation, amortisation and 86,656.27 97,493.09

taxation

Finance Cost 55,344.49 70,729.30

Depreciation and Amortization 1,531.95 7,857.47

Operational profit before tax 29,779.83 18,906.32

Less: Tax Expenses 7,916.25 1,137.40

Less: Minority Interest (1.55) 12.41

Profit for the year 21,865.13 17,756.51

Balance brought forward (34,329.08) (27,562.36)

Add: Other adjustments 2714.21 (123.23)

Profit available for appropriation (9,749.74) (9,929.08)

Less: Transferred to Debentures Redemption Reserve 26,700.00 24,400.00

Closing Balance (36,449.74) (34,329.08)

Net Worth 1,080,468.12 1,055,905.12

STATE OF COMPANY'S AFFAIRS AND PERFORMANCE REVIEW

* The Turnover of the Company increased by 16% and stood at Rs. 109,093.36 lacs as against Rs. 94,044.27 lacs in the previous year.

* The Company's Profit from Operations for the year ended March 31, 2015 increased by 20.35% to Rs. 30,753.25 lacs as against Rs. 25,553.00 lacs in the previous year.

* The Net Profit for the year has decreased by 7.56% to Rs. 22,633.35 lacs as against Rs. 24,484.94 lacs in previous year on account of Income Tax Expenses of Rs. 8,119.90 lacs as against Rs. 1,068.06 lacs.

* During the year under review, Company's Debt Including Non-Convertible Debentures ("NCD") has been repaid aggregating to Rs. 50,775.48 lacs and Debt Service Ratio is 1.81.

MANAGEMENT DISCUSSION AND ANALYSIS A detailed review of the operations, performance and future outlook of the Company and its businesses is given in the Management Discussion and Analysis Report, which forms part of this Report. SUBSIDIARY COMPANIES

As at March 31, 2015, your Company has following subsidiaries:

Sr. Name of Subsidiary No.

1 Blue Star Realtors Private Limited

2 BKC Developers Private Limited

3 Excel Arcade Private Limited

4 Guruashish Construction Private Limited

5 HC Infracity Private Limited

6 Lashkaria Construction Private Limited

7 Mazda Estates Private Limited

8 Privilege Power and Infrastructure Private Limited

9 Ravijyot Finance and Leasing Private Limited

During the year, your Company has divested its 100% shareholding of its wholly owned subsidiary company, viz. HDIL Entertainment Private Limited.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, ("the Act") read with Rule 8 of Companies (Accounts) Rules, 2014, the Company has prepared its consolidated financial statement including all of its subsidiaries, which is forming part of this report. A statement containing salient features of financial statements of subsidiary companies in Form AOC 1 is included in the Annual Report at Page No. 88.

The separate audited financial statements in respect of each of the subsidiary companies shall be kept open for inspection at the Registered Office of the Company on all working days between 10:00 a.m. to 12:00 noon, for a period of 21 days before the date of the Annual General Meeting ("AGM"). Your Company will also make available these documents upon a written request by any Member of the Company interested in obtaining the same. The separate audited financial statements in respect of each of the subsidiary companies is also available on the website of your Company at www.hdil.in.

DIVIDEND

In view of the current market and industry scenario, your Board has been actively pursuing paring of its debt and optimising its land banks. Keeping in its objective, the Board deems it proper to conserve its cash flow for execution of its existing projects, your Directors have not recommended payment of any Dividend for the F.Y. ended March 31,2015.

DEBENTURES

During the year under review, your Company has not issued any Debentures. However, out of the total NCD issued in the earlier years by the Company, during the year under review there has been repayment of NCD aggregating to Rs. 30,577.62 lacs.

SHARE CAPITAL

The paid-up equity share capital of the Company as at March 31, 2015 was Rs. 41,900.40 lacs. During the year under review, there was no change in the issued, subscribed and paid up share capital of the Company.

The equity shares of your Company continue to be listed on BSE Limited and National Stock Exchange of India Limited.

RESERVES

As per requirements of the provisions of Section 71 of the Act, your Company has transferred Rs. 26,700.00 lacs to Debenture Redemption Reserve.

FIXED DEPOSITS

Your Company did not hold any public deposits at the beginning of the year, nor it has accepted any deposits from the public during the year under review, within the meaning of Section 73 of the Act and the Companies (Acceptance of Deposits) Rules, 2014.

EXTRACT OF ANNUAL RETURN

An extract of the Annual Return of the Company, as prescribed under Section 92(3) of the Act and Companies (Management and Administration) Rules, 2014, framed thereunder, is attached as Annexure 'A'.

HUMAN RESOURCES

Your Company recognizes people as its most valuable asset and it has built an open, transparent and meritocratic culture to nurture this asset.

Your Company has embarked on the journey of creating a High Performance Culture and has laid the foundation towards this.

Company's Learning and Development initiatives are focused on enhancing functional skills and competencies of its employees and its other Learning and Development interventions include Executive Development Programs, e-learning and various class room based training programmes.

Your Company is committed to strive towards full engagement of all its employees, partners, contractors, suppliers and clients to ensure safe working conditions and safe behaviour as well as take care of their health.

REPORT UNDER THE PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company is committed to providing and promoting a safe and healthy work environment for all its employees.

Your Company has adopted a 'Prevention of Sexual Harassment' ("POSH") policy that is in line with the provisions of the Prevention of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed thereunder for prevention and redressal of complaints pertaining to sexual harassment at workplace, along with a structured reporting and redressal mechanism is in place. The POSH Policy is displayed on the Company's intra-net 'HDIL World'.

During F.Y. 2014-15, your Company has not received any complaint on sexual harassment.

DIRECTORS

Mr. Sunil Bihari Mathur, Director of the Company had resigned as a Director of the Company with effect from August 9, 2014, due to personal commitments and Mr. Waryam Singh, Director of the Company also stepped down as a Director of the Company with effect from March 23, 2015, due to personal commitments. The Board of Directors place on record their appreciation for the significant contribution made by Mr. Sunil Bihari Mathur and Mr. Waryam Singh during their tenure as Directors of the Company.

In accordance with the provisions of Section 152 of the Act and the Articles of Association of the Company, Mr. Ashok Kumar Gupta is liable to retire by rotation at the ensuing AGM of the Company and being eligible offers himself for re-appointment.

In accordance with the provisions of Section 161 of the Act and on the basis of recommendation of Nomination and Remuneration Committee, the Board of Directors at its Meeting held on November 14, 2014, had appointed Mr. Hazari Lal and Mrs. Sandhya Baliga as Additional Director of the Company and they hold office up to the conclusion of the ensuing AGM.

Pursuant to the applicable provisions of the Act and on the basis of recommendation of Nomination and Remuneration Committee, the Board of Directors at its Meeting held on May 15, 2015, had re-appointed Mr. Sarang Wadhawan as Vice Chairman and Managing Director of the Company, for a further term of 5 years, with effect from April 1,2016.

Your Company has received notices in writing pursuant to Section 160 of the Act from the Members along with deposit of Rs. 1,00,000/- each, signifying their intention to propose the candidature of Mr. Hazari Lal and Mrs. Sandhya Baliga as Independent Directors and Mr. Sarang Wadhawan as Vice Chairman and Managing Director of the Company at the ensuing AGM of the Company and their appointment is hereby proposed for the approval of the Members. The above appointment forms part of the Notice of the ensuing Nineteenth AGM and the respective Resolutions are recommended for your approval. Brief Profiles of Mr. Ashok Kumar Gupta, Mr. Hazari Lal, Mrs. Sandhya Baliga and Mr. Sarang Wadhawan as required under Clause 49 of the Listing Agreement forms part of the Notice of the ensuing AGM.

Your Company received declaration from all the Independent Directors of the Company confirming that they meet the criteria of Independence as prescribed by Section 149(6) of the Act.

The terms and conditions of the appointments of Independent Directors have been placed on the website of the Company, www.hdil.in.

Your Company has conducted the familiarization programme for all its Directors covering the matters as specified under Clause 49 of the Listing Agreement, details of which has been hosted on the Company's website at http://www.hdil.in/pdf/policies/ familiarisation-programme-for-independent-directors.pdf

DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) read with Section 134(5) of the Act:

a) in the preparation of the annual accounts for the year ended March 31, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b) 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 Ccompany as at March 31, 2015 and of the profit of the Company for the year ended on that date;

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

d) the Directors have prepared the annual accounts on a going concern basis;

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

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

CORPORATE GOVERNANCE

Your Company believes that good corporate governance practices enable the Management to direct and control the affairs of the Company in an efficient manner and to achieve the Company's goal of maximizing value for all its stakeholders. Your Company will continue to focus its resources, strengths and strategies to achieve its vision of becoming a leading real estate company in India, while upholding the core values of transparency, integrity, honesty and accountability.

Your Company's activities are carried out in accordance with good corporate practices and the Company is constantly striving to better them by adopting the best practices and the highest standards of Corporate Governance through transparency in business ethics, accountability to its customers, Government and others.

A report on Corporate Governance together with a certificate received from M/s. Thar & Co., Chartered Accountants, Statutory Auditors of the Company confirming the compliance with the provisions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement is given separately which forms part of this Report. (Refer Page No. 40).

NUMBER OF MEETINGS OF THE BOARD

The Board met on various occasions to discuss and decide various affairs, operations of the Company and to supervise and control the activities of the Company. The schedule of the Board / Committee Meetings to be held in the forthcoming F.Y. will be circulated to the Directors in advance to enable them to plan their schedule for their effective participation in the Meetings.

During the year under review the Board met four (4) times viz. on May 23, 2014, July 31, 2014, November 14, 2014 and February 14, 2015.

Detailed information on the Meetings of the Board is included in the report on Corporate Governance, which forms part of this Annual Report. (Refer Page No. 34).

COMMITTEES OF THE BOARD

Your Company has several committees which have been established as a part of the best corporate governance practices and which are in compliance with the requirements of the relevant provisions of applicable laws and statutes.

Your Company has following Committees of the Board:

* Audit Committee

* Finance Committee

* Nomination and Remuneration Committee

* Stakeholders Relationship Committee

* Corporate Social Responsibility Committee

* Risk Management Committee

* Project Committee

The details with respect to the compositions, powers, roles, terms of reference etc. of relevant committees are given in details in the 'Report on Corporate Governance' of the Company which forms part of this Annual Report.

AUDIT COMMITTEE

The Audit Committee comprises of the following Directors:

Mr. Shyam Sunder Dawra - Chairman

Mr. Ashok Kumar Gupta - Member

Mr. Lalit Mohan Mehta - Member

Mr. Raj Kumar Aggarwal - Member

*Mrs. Sandhya Baliga - Member

*Mrs. Sandhya Baliga was appointed as a Member of the Audit Committee at the Meeting of the Board of Directors held on November 14, 2014 and subsequently on May 15, 2015, she was appointed as a Chairperson of the Audit Committee.

All the recommendations made by the Audit Committee were accepted by the Board.

STATUTORY AUDITORS

M/s. Thar & Co., Chartered Accountants (Firm Registration No. 110958W), were appointed as Statutory Auditors of your Company at the last AGM held on September 30, 2014, for a term of two consecutive years. As per the provisions of Section 139 of the Act, the appointment of Auditors is required to be ratified by Members at every AGM and the same is proposed for the ratification by the Members at the ensuing AGM, which forms a part of the Notice of AGM.

The Company has received a letter from M/s. Thar & Co., Chartered Accountants, to the effect that their appointment, if ratified, would be in accordance with provision of the Section 139 of the Act and that, they are not disqualified for such appointment within the meaning of Section 141 of the Act.

EXPLANATION ON AUDITORS' REPORT

As regards the observation by the Auditor in the Auditor's Report regarding delay in payment of Statutory dues, subsequently the Company has paid TDS of Rs. 5.40 lacs and arrears of interest on Service Tax and VAT will be cleared upon completion of assessment of the respective years. In the matter of pending income tax demands, the note is self-explanatory and no further clarification is required.

There are no qualifications, reservations, adverse remarks or disclaimers made by Auditors in their Report dated May 15, 2015, on the Financial Statements of the Company for F.Y. 2014-15.

SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. SG & Associates, Company Secretaries (C.P. No. 5722) to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as Annexure 'B'.

There are no qualifications, reservations, adverse remarks or disclaimers made by M/s. SG & Associates, Company Secretaries, in their Report dated May 9, 2015, on the Secretarial and other related records of the Company for the F.Y. 2014-15.

COST AUDITORS

In pursuance of Section 148 of the Act, read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, the Board of Directors, on recommendation of Audit Committee, has appointed M/s. Ketki D. Visariya & Co., Cost Accountants (Firm Registration No. 00362), as the Cost Auditors to conduct the Cost Audit for the F.Y. 2014-15 and 2015-16 at a remuneration of Rs. 1,00,000/- each and reimbursement of out of pocket expenses plus service tax as applicable.

As required under the Act, ratification by the Members pertaining to the remuneration payable to the Cost Auditor forms part of the Notice of the ensuing AGM and the respective Resolution is recommended for your consideration.

ACCOUNTING STANDARDS FOLLOWED BY THE COMPANY

Your Company adheres to the Accounting Standards of the Companies (Accounting Standards) Rules, 2006 prescribed under the Companies Act, 1956, in the preparation of its financial statements and has not adopted a treatment different from that prescribed in any Accounting Standard notified under Section 211(3)(c) of the Companies Act, 1956, read with the Companies (Accounting Standards) Rules, 2006, as amended from time to time. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY Your Company's internal control system is designed to ensure operational efficiency, protection and conservation of resources, accuracy and promptness in financial reporting and compliance with laws and regulations. The internal control system is supported by an internal audit process for reviewing the adequacy and efficacy of the internal controls, including its systems and processes and compliance with regulations and procedures.

The Company has appointed an external Independent Auditors as the Internal Auditors of the Company to carry out the Internal Audit functions.

The Internal Audit Reports are discussed with the Management and are reviewed by the Audit Committee of the Board which also reviews the adequacy and effectiveness of the internal control system of the Company.

Your Company's internal control system is commensurate with the size, nature and operations of the Company.

INTERNAL FINANCIAL CONTROL

Your Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE COMPANY

Pursuant to Section 186 of the Act, particulars of the loans given, investments made, guarantees given and securities provided alongwith the purpose for which the loan or guarantee or security is proposed to be utilised by such recipient are provided under respective notes in Financial Statements.

RELATED PARTY TRANSACTIONS

All transactions entered with Related Parties during the year under review were on arm's length basis and in the ordinary course of business and that the provisions of Section 188 of the Act are not attracted and hence the disclosure in form AOC-2 is not required. Further, there are no material related party transactions during the year under review with Promoters, Directors or Key Managerial Personnel ("KMP"). The Company has framed a policy on Materiality of and Dealing with Related Party Transactions for the purpose of identification and monitoring of such transactions. Suitable disclosures as required under AS-18 have been made in Note 30 of the Notes to the financial statements.

As required under revised Clause 49(VIII) of the Listing Agreement, the Company has formulated and adopted a Policy on dealing with Related Party Transactions, which has been hosted on Company's website at http://www.hdil.in/pdf/policies/policv-on-materialitv-of- and-dealing-with-related-party-transactions.pdf.

Policy for determining 'Material' Subsidiaries As required under revised Clause 49(V)(D) of the Listing Agreement, the Company has formulated and adopted a Policy for Determining 'Material' Subsidiaries, which has been hosted on Company's website at http://www.hdil.in/pdf/policies/policy-for-determining- material-subsidiary.pdf.

RISK MANAGEMENT

Risk Management is an integral part of the Company's business strategy and taking that into consideration, your Company has constituted a Risk Management Committee which monitors risk tolerance limits, reviews and analyzes risk exposure related to specific issues and provides oversight of risk across the organization. The Board of Directors has adopted a Risk Management Policy. The Company manages risk through a detailed Risk Management Policy framework which lays down guidelines in identifying, assessing and managing risks that the businesses are exposed to.

VIGIL MECHANISM

Your Company has established a Vigil Mechanism for their Directors and employees to report their genuine concerns or grievances. Your Company has adopted a formal Whistle Blower Policy to report genuine concerns or grievance.

Your Company assures cognizance of complaints made and suggestions given by the employees. Even anonymous complaints will be looked into and whenever necessary, suitable corrective steps will be taken.

The Whistle Blower Policy, provides for adequate safeguards against victimization of persons who use such mechanism and also provides direct access to the Chairperson of the Audit Committee. The Whistle Blower Policy have been put up on the Company's Website at www.hdil.in.

NOMINATION AND REMUNERATION POLICY

The Board of Directors has framed a policy which lays down criteria for selection and appointment of Board Members. The policy also lays down a framework in relation to remuneration of Directors, KMP and Senior Management of the Company. The Policy also includes the criteria for determining qualifications, positive attributes and independence of Directors.

The detail of this policy is explained in the Corporate Governance Report.

EVALUATION OF THE BOARD, ITS COMMITTEE AND INDIVIDUAL DIRECTORS

Pursuant to the provisions of the Act and Clause 49 of the Listing Agreement, the Board has carried out an annual evaluation of its performance, of the Directors individually as well as the evaluation of the working of its Committees. The manner in which the evaluation was carried out was explained in the Report on Corporate Governance, which is forming a part of this report.

PARTICULARS OF EMPLOYEES

Your Directors place on record their appreciation for the contribution made by the employees of the Company at all levels. Relations between employees and the Management continued to be cordial during the year.

The statement containing particulars of employees as required under Section 197(12) of the Act, read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms part of this report. In terms of Section 136 of the Act, the same is open for inspection at the Registered Office of your Company on all working days between 10:00 a.m. to 12:00 noon upto the date of the Meeting. Copies of this statement may be obtained by the Members by writing to the Company Secretary of your Company.

The ratio of the remuneration of each Director to the median employee's remuneration and other details in terms of Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are forming part of this report as Annexure 'C'.

INVESTORS' RELATION AND GRIEVANCES

Investors' relations have been cordial during the year. As a part of compliance, the Company has formed Stakeholders Relationship Committee to deal with the issues relating to investors. There were no investors' grievances pending as on March 31, 2015. A confirmation to this effect has been received from the Company's Registrar and Share Transfer Agent.

CORPORATE SOCIAL RESPONSIBILITY ACTIVITIES

During the year your Company has constituted a Corporate Social Responsibility ("CSR") Committee which is in compliance to the provisions of Section 135 of the Act, read with Companies (Corporate Social Responsibility Policy) Rules, 2014, which comprises of the following Directors:

1) Mr. Sarang Wadhawan - Member

2) Mr. Shyam Sunder Dawra - Member

3) Mr. Lalit Mohan Mehta - Member

Your Company has also formulated a Corporate Social Responsibility Policy which is available on the website of the Company at www.hdil.in.

The average Net Profit of the Company for last three F.Y. Rs. 21,833.65 Lacs and accordingly the Company requires to spend Rs. 437.67 Lacs on CSR activities.

The Company has setup a trust in the name of 'HDIL Foundation' and with respect to the same necessary approvals such as Income Tax approvals etc. are under process.

In the view of above, the Board has decided that once the 'HDIL Foundation' would be established on the terms of CSR mechanism then the CSR activities would be undertaken efficiently by the Company.

The CSR activities to be carried out by the Company are driven by the expertise of the Management. Additionally, the Company gives preference to the local area(s) of its operations for CSR activities. The Company believes that the CSR should be in the field(s) which have substantial social impact and which co-relate with the philosophy of the Company to improve the quality of life. During the F.Y. 2014-15, the Company did not come across any project, which reflected the above approach and hence the entire spending prescribed towards CSR could not be made during F.Y. 2014-15. The Company however has initialled following programmes towards CSR activities:

i. arranging transportation of the school going children of slum dwellers rehabilitated at Kurla site.

ii. holding of free medical camps for the labour engaged at various construction sites.

iii. taking additional safety measure to enhance security of labour engaged at various construction sites.

CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGICAL ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Information as required under Section 134(3)(m) of the Act read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 for the year ended March 31, 2015 is as under:

CONSERVATION OF ENERGY

Your Company is conscious about its responsibility to conserve energy, power and other energy sources wherever possible. We emphasis towards a safe and clean environment and continue to adhere to all regulatory requirements and guidelines. The construction team under the guidance of expert engineers of the Company continuously strives and devises various means to conserve energy and identify methods for optimum use of energy.

Initiatives are taken for energy efficiency systems for Buildings in various phases like design, building and occupation by considering various options and appropriate measures for energy conservation which are stated as following:

* A Building Management System (BMS) or a (more recent terminology) Building Automation System (BAS) is a computer-based control system installed in buildings that controls and monitors the building's mechanical and electrical equipment such as ventilation, lighting, power systems, fire systems and security systems.

* Energy Efficiency System: The energy efficient equipments enveloping the building viz. lighting, heating, ventilation, air conditioning (HVAC) etc. proves to be helpful in energy consuming and increasing efficiency with more power.

* Insulation: The appropriate synthetic fibre (insulation material) is used on the basis of climate, building type and recommended R-value which reduces heating and cooling loads by resisting the transfer of heat through ceilings, walls and floors.

* Multipane Windows, Window Treatment and Storm Doors, UPVC Doors/Windows etc.: These types of materials are stable to pollution effect, sea water resistant and chemical proof. Moreover they act as a agent between surround thermal outburst and internal atmosphere.

* Zoning System: It has multiple thermostats that are wired to control panel which constantly read the temperature of their specific zone, then open or close the dampers operated by thermostats within the ductwork of the forced air system. It is not only helpful in balancing inconsistent room temperatures, but it's also great for heating or cooling individual bedrooms based on the desired temperature setting.

* Passive solar Design: Following are the component which keeps the optimum level of heat or thermal transfer through building and helps dissipate unwanted heat.

1. Masonry or water heat storage walls,

2. Single glazed/double glazed windows,

3. Sunspace or greenhouse,

4. Overhanging roof,

5. Sunshades,

6. Vents and

7. Exhausts fans (occasionally).

RESEARCH AND DEVELOPMENT

The Company has undertaken Research and Development ("R&D") activity in development of technology in the area of construction.

In today's competitive market where it is obvious need to construct with optimum cost, reduced schedule while maintaining highest standard of quality, our Company is actively involved in R&D activities. Some of them are:

Optimization of Space:

Mechanical Car Parking

Automated car parking systems use a similar type of technology to that used for mechanical parcel handling and document retrieval. Hydraulic or mechanical car lifters raise the vehicle to another level for proper storing. The vehicle can be transported vertically (up or down) and horizontally (left and right) to a vacant parking space until the car is needed again.

DOKA formwork

* Installation time is minimal as whole set (for each floor) can be lifted using hydraulic equipments as a single unit.

ULMA formwork

* Comprises of aluminum components suitable for large areas and fast erection.

* Very versatile, due to the possibility of changing beams direction (in case design is not finalized).

* Excellent concrete finish.

MIVAN formwork

* Most suitable for Indian conditions as a tailor-made aluminum formwork for cast-in-situ fully concrete structure.

* Fast, easy erection, thus reducing requirement of highly skilled labor.

All of the above can be repeated for several slab cycles unlike conventional plywood shuttering and have longer shelf life.

Other Research and Development Initiatives

* Installation of safety apparatus for emergency evacuation purpose in an unlikely event of hazard.

* Study, Analysis and use of various shuttering patterns for economy, conservation of time and better quality of work.

* Substitution of Diaphragm wall with sheet piling as shoring options.

* Study, Analysis and use of composite structure in place of conventional structure.

* Optimization of resources and their recycling for further use.

* Use of environment friendly materials and developing green building concept.

* Analysis and study of trade off among various services for optimization.

Emphasis is given on time, cost and quality and setting an efficient trade-off among these three variables of Project Management in R&D efforts.

Ingstrom Fire Escape Chutes

* Quick and easy to deploy, always ready to use.

* Users have the ability to control the speed of one's own descent.

* Allows external means to control the speed of one's descent to ground level.

* Suitable for all ages and physical conditions of evacuees, including physically impaired and unconscious people.

Initiatives for Sustainable Building Energy Conservation

* Use of energy efficient CFL bulbs for internal and external lighting purpose.

* In comparison to incandescent lamps they save almost 50% of energy.

* Glass coating process enables excellent lumen maintenance all throughout its life span.

* RoHS (Restriction of Hazardous Substances Directive) compliant unit design.

Security Systems

1. Fire Alarm System:

As a safety measure during fire, zoning of basements is done to control and restrict spreading of fire. It's a system in which number of devices working together to detect and alert people through visual and audio appliances when smoke/fire is present. These alarms may be activated from smoke detectors and heat detectors. They may also be activated via Manual fire alarm activation devices such as manual call points or pull stations.

2. Water Curtain System:

This system is required in all floors including parking area for covering external wall openings as specified in the local codes on fire services installations. This system is a sprinkler that produces a water curtain. It can be controlled either manually or automatically to let water flow to the object affected with fire. Water discharged from the valves are blocked by the metallic part and the direction of the water is changed by 180°. Because of the shape of the valve outlet, a curtain-like spray pattern is formed and discharged to the objects concerned.

TECHNOLOGICAL ABSORPTION

Your Company has not imported any technology. However, we believe and use information technology extensively in all spheres of our activities to improve efficiency levels.

FOREIGN EXCHANGE EARNINGS AND OUTGO

(Rs. In Lacs)

Year 2014-15 2013-14

Foreign exchange earnings - -

Foreign exchange outgo 123.56 18.00

PARTICIPATION IN THE GREEN INITIATIVE

Your Company continues to wholeheartedly participate in the Green Initiative undertaken by the Ministry of Corporate Affairs ("MCA") for correspondences by Corporates to its shareholders through electronic mode. All the shareholders who have not so far substituted / updated their email id are requested to join the said program by sending email of their preferred email addresses to the Registrar and Share Transfer Agent rajeev.kr@karvy.com or to the Company on info@hdil.in.

REGULATORY ACTION

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and future operations of the Company.

INFORMATION OF MATERIAL CHANGES AND COMMITMENTS

There are no material changes or commitments affecting the financial position of the Company which have occurred after March 31, 2015 and prior to May 15, 2015, being the date of this report.

CAUTIONARY STATEMENT

Statements in this Directors' Report and Management Discussion and Analysis describing the Company's objectives, estimates, expectations or predictions may be "forward-looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materiality from those expressed or implied. Important factors that could make difference to the Company's operations include raw material availability and its price, pricing in the Company's principle markets, changes in Government regulations, Tax regimes and economic developments within India.

APPRECIATION

Your Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by the employees of the Company and its Associates at all levels and wish to convey their appreciation to the Banks, Financial Institutions, Government Authorities, Customers and other Business Associates for the excellent assistance and co-operation received and wish to place on record their gratitude to the Members for their trust, support and confidence reposed in the Company.

For and on behalf of the Board of Directors

Place: Mumbai Rakesh Kumar Wadhawan Date: May 15, 2015 Executive Chairman


Mar 31, 2014

Dear Members,

The Directors have pleasure in presenting the Eighteenth Annual Report of your Company together with the "Management Discussion and Analysis Report", "Corporate Governance Report", and "Audited Financial Statements" for the Financial Year ended March 31, 2014.

1. FINANCIAL PERFORMANCE (Rs. In Lacs)

Standalone Consolidated

Particulars 2013-14 2012-13 2013-14 2012-13

Gross sales and other receipts 94,044.27 1,15,361.33 95,364.41 1,06,522.67

Profit before finance cost, depreciation, amortisation exceptional items and 77,297.12 1,18,268.31 97,493.09 1,31,290.98 taxation

Finance Cost 50,964.06 56,777.06 70,729.30 69,230.33

Depreciation and Amortisation 780.06 781.98 7,857.47 8,453.97

Operational profit before exceptional items and tax 25,553.00 60,709.27 18,906.32 53,606.68

Less: Exceptional items - 44,198.45 - 44,198.45

Less: Provision for Tax 1,068.06 1,972.83 1,137.40 2,051.70

Less: Minority Interest - - 12.41 (4.67)

Add: Share of profit/(loss) of Associates - - - (28.99)

Profit for the year 24,484.94 14,537.99 17,756.51 7,332.21

Balance brought forward 3,846.94 3,804.35 (27,562.36) (20,404.56)

Add: Other adjustments (140.11) (22.50) (123.23) (17.11)

Profit available for appropriation 28,191.77 18,319.84 (9,929.08) (13,089.46)

Less: Transferred to General Reserve - - - -

Less: Transferred to Debentures Redemption Reserve 24,400.00 14,472.90 24,400.00 14,472.90

Closing Balance 3,791.77 3,846.94 (34,329.08) (27,562.36)

Net Worth 10,42,521.02 10,18,176.19 10,55,905.12 10,38,271.84

2. PERFORMANCE REVIEW

The Turnover of the Company decreased by 18.48% and stood at Rs. 94,044.27 lacs as against Rs. 1,15,361.33 lacs in the previous year. The Company''s Profit from Operations for the year ended March 31, 2014 decreased by 57.91% to Rs. 25,553.00 lacs as against Rs. 60,709.27 lacs in the previous year. However, the Net Profit for the year has increased by 68.42% to Rs. 24,484.94 lacs as against Rs. 14,537.99 lacs in previous year.

3. DIVIDEND

The results and financial position of the Company are set out in the Financial Statements. With a view to reduce the cost base of the Company and conserve the resources so as to meet the fund requirements for Company''s on-going projects and also its growth plans, your Directors have not recommended any payment of Dividend for the Financial Year ended March 31, 2014.

4. MANAGEMENT''S DISCUSSION AND ANALYSIS

A detailed review of the operations, performance and future outlook of the Company and its businesses is given in the Management''s Discussion and Analysis, which forms part of this Report.

5. SUBSIDIARY COMPANIES

As at March 31, 2014, your Company has following subsidiaries:

Sr. Name of Subsidiary No.

1 Blue Star Realtors Private Limited

2 BKC Developers Private Limited

3 Excel Arcade Private Limited

4 Guruashish Construction Private Limited

5 HDIL Entertainment Private Limited

6 HC Infracity Private Limited

7 Lashkaria Construction Private Limited

8 Mazda Estates Private Limited

9 Privilege Power and Infrastructure Private Limited

10 Ravijyot Finance and Leasing Private Limited

The Ministry of Corporate Affairs (MCA) vide its General Circular No. 3/2011 dated February 21, 2011 read together with General circular No.2/2011 dated February 8, 2011 issued modifying their circular No. 5/12/2007–CL-III has granted general exemption under Section 212(8) of the Companies Act, 1956 to Companies from attaching the accounts of their subsidiaries in their annual reports subject to fulfillment of certain conditions prescribed. The Board of Directors of the Company at its Meeting held on May 23, 2014 in line with the circular of MCA have passed the resolution granting the requisite approvals for not attaching the Balance Sheet, statement of Profit & Loss, report of the Board of Directors and Auditor''s report of each of the Subsidiary Companies to the accounts of the Company for the year ended March 31, 2014. The Company will make available these documents/details upon request by any Member of the Company at its Registered Office. As required by Accounting Standard–21 (AS–21) prescribed by the Companies (Accounting standards) Rules, 2006, the Company''s consolidated financial statements included in this Annual Report incorporate the accounts of its subsidiaries. A summary of key financials of the subsidiaries of your Company is included and shown separately in this Annual Report.

6. DEBENTURES

During the year under review, Company has not issued any Non Convertible Debentures. However, out of the total Non-convertible debentures issued in the earlier years by the Company, there has been redemption of Non Convertible Debentures aggregating to Rs. 56,797.78 lacs.

7. SHARE CAPITAL

During the year under review, there has been no change in the issued, subscribed and paid up share capital of the Company. The Equity Shares of your Company continue to be listed on BSE Limited ("BSE") and National Stock Exchange of India Limited ("NSE").

8. DIRECTORS

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company Mr. Waryam Singh, Mr. Ashok Kumar Gupta and Mr. Shyam Sunder Dawra are liable to retire by rotation at the ensuing Annual General Meeting ("AGM") of the Company and offer themselves for re-appointment.

The above re-appointments form part of the Notice of the forthcoming Eighteenth Annual General Meeting and the respective resolutions are recommended for your approval.

Profile of the Directors retiring by rotation and proposed to be re appointed as required under Clause 49 of the Listing Agreement, is part of the explanatory statement to the Notice of the Eighteenth Annual General Meeting.

In accordance with the provisions of Section 149 of the Companies Act, 2013 and the Rules made there under, which came into effect from April 1, 2014, approval of the Members will be sought at the ensuing Annual General Meeting of the Company for formalizing the appointment of Mr. Sunil Behari Mathur, Mr. Lalit Mohan Mehta, Mr. Shyam Sunder Dawra and Mr. Raj Kumar Aggarwal as Independent Directors of the Company who are not liable to retire by rotation, for a period of five years.

9. RESERVES

As per requirement of the provisions of Section 117(c) of the Companies Act, 2013, your Company has transferred Rs. 24,400.00 lacs to Debenture Redemption Reserve.

10. FIXED DEPOSITS

The Company has not accepted any deposits during the year under review from the public within the meaning of Section 72 of the Companies Act, 2013.

11. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 217 (2AA) of the Companies Act, 1956, with respect to Directors'' responsibility statement, it is hereby confirmed:

a) That in the preparation of the annual accounts for the year ended March 31, 2014, the applicable accounting standards have been followed and no material departures have been made from the same.

b) That the Directors have selected such accounting polices and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year.

c) That the Directors have 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.

d) That the Directors have prepared the annual accounts for the year ended March 31, 2014, on a going concern basis.

12. CORPORATE GOVERNANCE

Corporate governance is a key to improving efficiency, transparency, accountability and growth as well as enhancing investor''s confidence. Your Company has adopted the Corporate Governance practices in all its activities so as to conduct its affairs to ensure fairness to all stakeholders. It is also a process of building positive relationship and making a wider impact with greater commitment and trust, on all with whom the Company has relationship. A report on Corporate Governance together with a certificate received from M/s. Thar & Co. Statutory Auditors of the Company confirming the compliance with the provisions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement is given separately which forms part of this Report.

13. LISTING FEES

The equity shares of the Company are listed at the BSE and the NSE. The Company has paid the applicable listing fees to the above stock exchanges up to date. The Company''s shares are also traded in the dematerialised segment for all investors compulsorily and the Company had entered into agreements with the Central Depository Services (India) Limited ("CDSL") and National Securities Depository Limited ("NSDL") for custodial services.

14. STATUTORY AUDITORS

M/s. Thar & Co., Chartered Accountants, the Statutory Auditors of the Company retire at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. Your Company has received necessary certificate from Statutory Auditors to this effect and that their reappointment, if made, will be in accordance with the provisions of the Section 139, 141 and other applicable provisions of the Companies Act, 2013 read with Companies (Audit and Auditors) Rules, 2014 thereon.

As per the recommendation of the Audit Committee, the Board of Directors proposes the reappointment of M/s. Thar & Co., Chartered Accountants, as the Statutory Auditors of the Company for a term of two financial years up to March 31, 2016, from the conclusion of the ensuing AGM until conclusion of the twentieth AGM of the Company

15. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Your Company has adequate system of Internal Controls, to ensure that all assets are safeguarded and protected against loss from unauthorised use or disposal and commercial transactions are authorised, recorded and reported correctly. Internal Control System of the Company has been devised through its extensive experience that ensures control over various functions in its business. The Internal Auditor directly reports to the Board/ Audit Committee. The statutory audit of the Company is conducted by M/s. Thar & Co. Chartered Accountants who submit their reports to Board/ Audit Committee.The performance of the Company is regularly reviewed by the Audit Committee and/or the Board of Directors to ensure that it is in consonance with the overall corporate policy and in line with pre-set objectives. To facilitate improved efficiency in Business Operations, SAP Business ERP system is being used for integrating all Business Functions of the Company from Planning, Execution, Monitoring and Control of the Projects including MIS of the Business Operations thereby enhancing the efficiency of the Business Operations.

16. COST AUDITORS

In pursuance of Section 148 of the Companies Act, 2013 and Companies (Audit and Auditors) Rules, 2014 thereon, your Directors have appointed M/s. Ketki D. Visariya & Co., Cost Accountants, as the Cost Auditors to conduct the Cost Audit for the financial year ending March 31, 2014.

17. INVESTORS'' RELATIONS AND GRIEVANCES

Investors'' relations have been cordial during the year. As a part of compliance, the Company has formed Stakeholders Relationship Committee to deal with the issues relating to investors. There were no investors'' grievances pending as on March 31, 2014. A confirmation to this effect has been received from the Company''s Registrar and Share Transfer Agent. The Company has separate Investor Relations department headed by Mr. Hari Prakash Pandey designated as Vice President Finance and Investor Relations.

18. PARTICIPATION IN THE GREEN INITIATIVE

Your Company continues to wholeheartedly participate in the Green Initiative undertaken by the Ministry of Corporate Affairs ("MCA") for correspondences by Corporates to its shareholders through electronic mode. All the shareholders are requested to join the said program by sending their preferred email addresses to the Registrar and Share Transfer Agent.

19. CORPORATE SOCIAL RESPONSIBILITY

Your Company acknowledges and offers full support to Governments'' schemes for economically weaker sections. It endeavors to make a constructive contribution to the underprivileged communities by supporting socio-economic initiatives. It is the strong conviction that benefit comes as much from its strong organizational pledge to Corporate Governance, as from its pursuit and fulfillment of Corporate Social Responsibility ("CSR").The details of the CSR activities undertaken by the Company forms part of the Corporate Governance Report. To this end, the Company has formed a Trust in the name of HDIL Foundation.

20. CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGICAL ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Information 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 for the year ended March 31, 2014.

1. CONSERVATION OF ENERGY

Your Company is conscious about its responsibility to conserve energy, power and other energy sources wherever possible. We emphasis towards a safe and clean environment and continue to adhere to all regulatory requirements and guidelines. The construction team under the able guidance of expert engineers of the Company continuously strives and devises various means to conserve energy and identify methods for optimum use of energy.

Initiatives are taken for energy efficiency systems for Buildings in various phases like design, building and occupation by considering various options and appropriate measures for energy conservation, use of single glazing/double glazing, use of UPVC doors/windows, using BMS systems etc.

2. RESEARCH AND DEVELOPMENT

The Company has undertaken Research and Development ("R&D") activity in development of technology in the area of construction.

In today''s competitive market where it is obvious need to construct with optimum cost, reduced schedule while maintaining highest standard of quality, your Company is actively involved in R&D activities. Some of them are: DOKA formwork

- Installation time is minimal as whole set (for each floor) can be lifted using hydraulic equipments as a single unit.

ULMA formwork

- Comprises of aluminum components suitable for large areas and fast erection.

- Very versatile, due to the possibility of changing beams direction (in case design is not finalized).

- Excellent concrete finish. MIVAN formwork

- Most suitable for Indian conditions as a tailor–made aluminum formwork for cast–in–situ fully concrete structure.

- Fast, easy erection, thus reducing requirement of highly skilled labor.

All of the above can be repeated for several slab cycles unlike conventional plywood shuttering and have longer shelf life. Installation of safety apparatus for emergency evacuation purpose in an unlikely event of hazard. Ingstrom Fire Escape Chutes

- Quick and easy to deploy, always ready to use.

- Users have the ability to control the speed of one''s own descent.

- Allows external means to control the speed of one''s descent to ground level.

- Suitable for all ages and physical conditions of evacuees, including physically impaired and unconscious people.

- Use of energy efficient CFL bulbs for internal and external lighting purpose

- In comparison to incandescent lamps they save almost 50% energy.

- Glass coating process enables excellent lumen maintenance all throughout its life span.

- RoHS (Restriction of Hazardous Substances Directive) compliant unit design.

- Study, Analysis and use of various shuttering patterns for economy, conservation of time and better quality of work.

- Substitution of Diaphragm wall with sheet piling as shoring options.

- Study, Analysis and use of composite structure in place of conventional structure.

- Optimization of resources and their recycling for further use.

- Use of environment friendly materials and developing green building concept.

- Analysis and study of trade off among various services for optimization.

Emphasis is given on time, cost and quality and setting an efficient trade-off among these three variables of Project management in R&D efforts.

3. TECHNOLOGICAL ABSORPTION

Your Company has not imported any technology. However, we believe and use information technology extensively in all spheres of our activities to improve efficiency levels.

21. PARTICULARS OF EMPLOYEES

Your Directors place on record their appreciation for the contribution made by the employees of the Company at all levels. Relations between employees and the management continued to be cordial during the year.

Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, forms part of this Report. However, as per the provisions of Section 219 (1)(b)(iv) of the Companies Act, 1956, this Report and Accounts are being sent to all the Members of the Company, excluding the Statement of Particulars of Employees. Any member interested in obtaining a copy of the said statement may write to the Company Secretary of the Company.

22. ACKNOWLEDGEMENT

Your Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by the employees of the Company and its group Companies at all levels and wish to convey their appreciation to the Banks, Financial Institutions, Government Authorities, customers and other business associates for the excellent assistance and co-operation received and wish to place on record their gratitude to the members for their trust, support and confidence.

For and on behalf of the Board of Directors

Place: Mumbai Rakesh Kumar Wadhawan

Date: May 23, 2014 Executive Chairman


Mar 31, 2013

Dear Members,

The Directors present the 17th Annual Report of your Company on the affairs of the Company together with the "Management Discussion and Analysis", "Corporate Governance Report", and "Audited Financial Accounts" for the Financial Year ended 31st March, 2013.

1. FINANCIAL PERFORMANCE

(March In Lacs)

Particulars Standalone Consolidated 2012-13 2011-12 2012-13 2011-12

Gross sales and other receipts 1,15,361.33 1,06,667.64 1,06,522.39 2,05,583.54

Profit before finance cost, depreciation, amortisation exceptional 1,18,268.31 1,00,184.55 1,31,290.98 1,55,685.65

items and taxation

Finance Cost 56,777.06 57,803.38 69,230.33 62,466.49 Depreciation and Amortisation 781.98 844.17 8,453.97 8,582.59

Operational profit before exceptional items and tax 60,709.27 41,537.00 53,606.68 84,636.57

Less: Exceptional items 44,198.45 44,198.45 782.34

Less: Provision for Tax 1,972.83 2,841.32 2,051.70 2,904.30

Less: Minority Interest (4.67) (2.53)

Add: Share of profit/floss) of Associates (28.99) 29.00

Profit for the year 14,537.99 38,695.68 7,332.21 80,981.46

Balance brought forward 3,804.35 46,402.46 (20,404.56) 30,889.73

Add: Other adjustments (22.50) 956.21 (17.11) 974.25

Profit available for appropriation 18,319.84 86,054.35 (13,089.46)1,12,845.44

Less: Transferred to General Reserve

Less: Transferred to Debentures Redemption Reserve 14,472.90 82,250.00 14,472.90 1,33,250.00

Closing Balance 3,846.94 3,804.35 (27,562.36) (20,404.56)

Net Worth 10,18,176.19 10,660.70 10,38,271.84 10,30,967.24

2. PERFORMANCE REVIEW

The Turnover of the Company increased by 8.15% and stood at Rs. 1,15,361.33 lacs as against Rs. 1,06,667.64 lacs in the previous year. The Company''s Profit from Operations for the year ended 31st March, 2013 increased by 46.16% to Rs. 60,709.27 lacs as against Rs. 41,537.00 lacs in the corresponding period in the previous year.

3. DIVIDEND

The results and financial position of the Company are set out on page no. 29 of the financial statements. With a view to reduce the cost base of the Company and conserve the resources so as to meet the fund requirements for Company''s on-going projects and also its growth plans, your Directors have not recommended any payment of dividend for the year 2012-13.

4. MANAGEMENT''S DISCUSSION AND ANALYSIS

A detailed review of the operations, performance and future outlook of the Company and its businesses is given in the Management''s Discussion and Analysis, which forms part of this Report.

5. SUBSIDIARY COMPANIES

As at 31st March, 2013, your Company has following subsidiaries:

SR. NO. NAME OF THE SUBSIDIARIES

1 Blue Star Realtors Private Limited

2 BKC Developers Private Limited

3 Excel Arcade Private Limited

4 Guruashish Construction Private Limited

5 HDIL Entertainment Private Limited

6 HC Infracity Private Limited

7 Lashkaria Construction Private Limited

8 Mazda Estates Private Limited

9 Privilege Power and Infrastructure Private Limited

10 Ravijyot Finance and Leasing Private Limited

The Ministry of Corporate Affairs (MCA) vide its General Circular No. 3/2011 dated 21st February, 2011 read together with General circular No. 2/2011 dated 8th February, 2011 issued modifying their circular No. 5/12/2007—CL-III has granted general exemption under Section 212(8) of the Companies Act, 1956 to Companies from attaching the accounts of their subsidiaries in their annual reports subject to fulfillment of certain conditions prescribed. The Board of Directors of the Company at its Meeting held on 29th May, 2013 in line with the circular of MCA have passed the resolution granting the requisite approvals for not attaching the Balance Sheet, statement of Profit and Loss, report of the Board of Directors and Auditor''s report of each of the Subsidiary Companies to the accounts of the Company for the year ended 31st March, 2013. The Company will make available these documents/details upon request by any Member of the Company at its Registered Office. As required by Accounting Standard-21 (AS-21) prescribed by the Companies (Accounting standards) Rules, 2006, the Company''s consolidated financial statements included in this Annual Report incorporate the accounts of its subsidiaries. A summary of key financials of the HDILSubsidiaries is included and shown separately in this Annual Report.

6. DEBENTURES

During the year under review. Company has not issued any Non-convertible Debentures. However, out of the total Non- convertible debentures issued in the earlier years by the Company, there has been redemption of Non-Convertible Debentures aggregating to Rs. 31,393.30 lacs.

7. SHARE CAPITAL

During the year under review, there has been no change in the issued, subscribed and paid-up share capital of the Company. The Equity Shares of your Company continue to be listed on the Bombay Stock Exchange Limited (BSE) and National Stock Exchange of India Limited (NSE).

8. DIRECTORS

At the 17th Annual General Meeting, Shri Raj Kumar Aggarwal, Shri Lalit Mohan Mehta and Shri Sunil Behari Mathur retire by rotation and being eligible, offerthemselves for re-appointment. The above re-appointments form part of the Notice of the forthcoming 17th Annual General Meeting and the respective resolutions are recommended for your approval. Profile of the Directors retiring by rotation and proposed to be re appointed as required under Clause 49 of the Listing Agreement, is part of the explanatory statement to the Notice of the 17th Annual General Meeting.

9. RESERVES

As per requirement of the provisions of Section 117(c) of the Act, your Company has transferred Rs. 14,472.90 lacs to Debenture Redemption Reserve.

10. FIXED DEPOSITS

The Company has not accepted any deposits during the year under review from the public within the meaning of Section 58Aofthe Companies Act, 1956.

11. DIRECTORS'' RESPONSIBILITY STATEMENT Pursuant to the provisions of Section 217 (2AA) of the Companies Act, 1956, with respect to Directors'' responsibility statement, it is hereby confirmed:

a) That in the preparation of the annual accounts for the year ended 31st March, 2013, the applicable accounting standards have been followed and no material departures have been made from the same.

b) That the Directors have selected such accounting polices and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year.

c) That the Directors have 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.

d) That the Directors have prepared the annual accounts for the year ended 31st March, 2013 on a going concern basis.

12. CORPORATE GOVERNANCE

Corporate governance is a key to improving efficiency, transparency, accountability and growth as well as enhancing investor''s confidence. Your Company has adopted the Corporate Governance practices in all its activities so as to conduct its affairs to ensure fairness to all stakeholders. It is also a process of building positive relationship and making a wider impact with greater commitment and trust, on all with whom the Company has relationship.

A report on Corporate Governance together with a certificate received from M/s. Thar & Co. Statutory Auditors of the Company confirming the compliance with the provisions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement is given separately which forms part of this Report.

13. LISTING FEES

The equity shares of the Company are listed at the Bombay Stock Exchange Limited (BSE) and the National Stock

Exchange of India Limited (NSE). The Company has paid the applicable listing fees to the above stock exchanges up to date. The Company''s shares are also traded in the dematerialised segment for all investors compulsorily and the Company had entered into agreements with the Central Depository Services (India) Limited (CDSL) and National Securities Depository Limited (NSDL) for custodial services.

14. STATUTORY AUDITORS

M/s. Thar & Co., Chartered Accountants, the Statutory Auditors of the Company retire at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. Your Company has received necessary certificate from Statutory Auditors to this effect and that their re-appointment, if made, will be in accordance with the provisions of the Section 224 (1B) of the Companies Act, 1956.

As per the recommendation of the Audit Committee, the Board of Directors proposes the re-appointment of M/s. Thar & Co., Chartered Accountants, as the Statutory Auditors of the Company. As regards the Auditors observation with respect to delay in statutory dues and payment of dues to banks and financial institutions, we refer to clause No. 9(a)(b) of Annexure to indepedent Auditors'' Report on page no. 26 &27 of the attached report, the Company is in process of settling these dues. As regards observations made by the Auditors regarding MIAL, please refer to note on page no. 25 of the Annual report. The Company will initiate appropriate action based on the advice of its legal counsels.

15. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY Your Company has adequate system of Internal Controls, to ensure that all assets are safeguarded and protected against loss from unauthorised use or disposal and commercial transactions are authorised, recorded and reported correctly. Internal Control System of the Company has been devised through its extensive experience that ensures control over various functions in its business. The internal auditor directly reports to the Board/Audit Committee. The statutory audit of the Company is conducted by M/s. Thar & Co. Chartered Accountants who submit their reports to Board/Audit Committee.The performance of the Company is regularly reviewed by the Audit Committee and/or the Board of Directors to ensure that it is in consonance with the overall corporate policy and in line with pre-set objectives.

To facilitate improved efficiency in Business Operations, SAP Business ERP system is being used for integrating all Business Functions of the Company from Planning, Execution, Monitoring and Control of the Projects including MIS of the Business Operations thereby enhancing the efficiency of the Business Operations.

16. COST AUDITORS

In pursuance of Section 233-B of the Companies Act, 1956, your Directors have appointed Messrs. Ketki D. Visariya & Co., Cost Accountants, as the Cost Auditors to conduct the Cost Audit for the financial year ending 31st March, 2013.

17. INVESTORS'' RELATION AND GRIEVANCES Investors'' relations have been cordial during the year. As a part of compliance, the Company has formed Investor Grievance and Share Transfer Committee to deal with the issues relating to investors. There were no investors'' grievances pending as on 31st March, 2013. A confirmation to this effect has been received from the Company''s Registrar and Share Transfer Agent. The Company has separate Investor Relations department headed by Mr. Hari Prakash Pandey designated as Vice President Finance and Investor Relations.

18. PARTICIPATION IN THE GREEN INITIATIVE

Your Company continues to wholeheartedly participate in the Green Initiative undertaken by the Ministry of Corporate Affairs (MCA) for correspondences by Corporates to its shareholders through electronic mode. All the shareholders are requested to join the said program by sending their preferred email addresses to the Registrar and Share Transfer Agent.

19. CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES

Your Company acknowledges and offers full support to Governments'' schemes for economically weaker sections. It endeavors to make a constructive contribution to the underprivileged communities by supporting socio-economic initiatives. It is the strong conviction that benefit comes as much from its strong organizational pledge to Corporate Governance, as from its pursuit and fulfillment of Corporate Social Responsibility. The details of the CSR activities undertaken by the Company forms part of the Corporate Governance Report. To this end, the Company has formed a Trust in the name of HDIL Foundation.

20. CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGICAL ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Information 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 for the year ended 31st March, 2013.

1. CONSERVATION OF ENERGY

Your Company is conscious about its responsibility to conserve energy, power and other energy sources wherever possible. We emphasis towards a safe and clean environment and continue to adhere to all regulatory requirements and guidelines. The construction team under the able guidance of expert engineers of the Company continuously strives and devises various means to conserve energy and identify methods for optimum use of energy.

Initiatives are taken for energy efficiency systems for Buildings in various phases like design, building and occupation by considering various options and appropriate measures for energy conservation, use of single glazing/ double glazing, use of UPVC doors/windows, using BMS systems etc.

2. RESEARCH AND DEVELOPMENT

The Company has undertaken Research and Development (R & D) activity in development of technology in the area of construction.

In today''s competitive market where it is obvious need to construct with optimum cost, reduced schedule while maintaining highest standard of quality, your Company is actively involved in R&D activities. Some of them are: DOKA formwork

- Installation time is minimal as whole set (for each floor) can be lifted using hydraulic equipments as a single unit.

ULMA formwork

- Comprises of aluminum components suitable for large areas and fast erection.

- Very versatile, due to the possibility of changing beams direction (in case design is not finalized).

- Excellent concrete finish. MIVAN formwork

- Most suitable for Indian conditions as a tailor-made aluminum form work for cast-in-situ fully concrete structure.

- Fast, easy erection, thus reducing requirement of highly skilled labor.

All of the above can be repeated for several slab cycles unlike conventional plywood shuttering and have longer shelf life.

Installation of safety apparatus for emergency evacuation purpose in an unlikely event of hazard.

Ingstrom Fire Escape Chutes

- Quick and easy to deploy, always ready to use.

- Users have the ability to control the speed of one''s own descent.

- Allows external means to control the speed of one''s descent to ground level.

- Suitable for all ages and physical conditions of evacuees, including physically impaired and unconscious people.

Use of energy efficient CFL bulbs for internal and external lighting purpose.

- In comparison to incandescent lamps they save almost 50% energy.

- Glass coating process enables excellent lumen maintenance all throughout its life span.

- RoHS (Restriction of Hazardous Substances Directive) compliant unit design.

Study, Analysis and use of various shuttering patterns for economy, conservation of time and better quality of work.

Substitution of Diaphragm wall with sheet piling as shoring options.

Study, Analysis and use of composite structure in place of conventional structure.

Optimization of resources and their recycling for further use.

Use of environment friendly materials and developing green building concept.

Analysis and study of trade off among various services for optimization.

Emphasis is given on time, cost and quality and setting an efficient trade-off among these three variables of Project management in R & D efforts.

3. TECHNOLOGICAL ABSORPTION

Your Company has not imported any technology. However, we believe and use information technology extensively in all spheres of our activities to improve efficiency levels.

4. FOREIGN EXCHANGE EARNINGS AND OUTGO

(Rs.in Lacs)

Year 2012-13 2011-12

Foreign exchange earnings

Foreign exchange outgo 29.63 50.33



21. PARTICULARS OF EMPLOYEES

Your Directors place on record their appreciation for the contribution made by the employees of the Company at all levels. Relations between employees and the management continued to be cordial during the year.

Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, forms part of this Report. However, as per the provisions of Section 219(1) (b) (iv) of the Companies Act, 1956, this Report and Accounts are being sent to all the Members of the Company, excluding the Statement of Particulars of Employees. Any member interested in obtaining a copy of the said statement may write to the Company Secretary of the Company.

22. ACKNOWLEDGEMENT

Your Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by the employees of the Company and its Group Companies at all levels and wish to convey their appreciation to the Banks, Financial Institutions, Government Authorities, customers and other business associates for the excellent assistance and co-operation received and wish to place on record their gratitude to the members for their trust, support and confidence. For and on behalf of the Board of Directors

Place: Mumbai Rakesh Kumar Wadhawan

Date: 29th May, 2013 Executive Chairman


Mar 31, 2012

The Directors are pleased to present the 16th Annual Report of your Company on the business and operations of the Company together with the "Management Discussion and Analysis", "Corporate Governance Report", and "Audited Financial Accounts" for the Financial Year (FY) ended 31st March, 2012.

1. FINANCIAL PERFORMANCE

(Rs in Lacs)

Particulars Standalone Consolidated 2011-12 2010-11 2011-12 2010-11

Gross sales and other receipts 1,06,667.64 1,92,275.96 2,05,765.86 1,89,659.52

Profit before finance cost, depreciation, amortisation 1,00,214.49 1,64,260.93 1,55,713.25 1,69,390.45 exceptional items and taxation

Finance Cost 57,833.31 57,690.31 62,494.09 62,426.21

Depreciation and Amortisation 844.18 724.92 8,582.59 8,375.64

Operational profit before exceptional items and tax 41,537.00 1,05,845.70 84,636.57 98,588.60

Less: Exceptional items - 449.57 782.34 449.57

Less: Provision for Tax 2,841.32 15,754.62 2,904.30 15,904.62

Less: Minority Interest - - (2.53) 56.69

Add: Share of profit/(loss) of Associates - - 29.00 (2.06)

Profit for the year 38,695.68 89,641.51 80,981.46 82,175.66

Balance brought forward 46,402.46 58,292.41 30,889.73 50,289.29

Add: Other adjustments 956.21 94.96 974.25 51.19

Profit available for appropriation 86,054.35 1,48,028.88 1,12,845.44 1,32,516.14

Less: Transferred to General Reserve - 58,292.41 - 58,292.41

Less: Transferred to Debentures Redemption Reserve 82,250.00 43,334.00 1,33,250.00 43,334.00

Closing Balance 3,804.35 46,402.47 (20,404.56) 30,889.73

Net Worth 10,03,660.70 9,63,708.85 10,30,967.24 9,48,703.66

2. PERFORMANCE REVIEW

The Turnover of the Company decreased by 44.52% and stood at Rs 106,667.64 lacs as against Rs 192,275.96 Lacs in the previous year. The Company's Profit from Operations for the year ended 31st March, 2012 decreased by 60.76 % to Rs 41,537.00 lacs as against Rs 105,845.70 lacs in the corresponding period of the previous year. During the year, Company's standalone net debt has been reduced by almost Rs 45,456.32 lacs, currently standing at Rs 374,083.11 lacs (10.83% lower than the previous year). Company has launched residential projects admeasuring 8,50,680 sq. ft.

3. DIVIDEND

With a view to conserve the resources and to meet the fund requirements for Company's on-going projects and also its growth plans, your Directors have not recommended any payment of dividend for the year 2011-12.

4. MANAGEMENT'S DISCUSSION AND ANALYSIS

A detailed review of the operations, performance and future outlook of the Company and its businesses is given in the Management's Discussion and Analysis, which forms part of this Report.

5. SUBSIDIARY COMPANIES

As at 31st March, 2012, your Company has following subsidiaries:

Sr. No Name of the Subsidiaries

1 Blue Star Realtors Private Limited

2 BKC Developers Private Limited

3 Excel Arcade Private Limited

4 Guruashish Construction Private Limited

5 HDIL Entertainment Private Limited

6 Lashkaria Construction Private Limited

7 HDIL Commercial Properties Private Limited (up to 30.06.2011)

8 Mazda Estates Private Limited

9 Privilege Power and Infrastructure Private Limited

10 Ravijyot Finance and Leasing Private Limited

11 HC Infracity Private Limited (with effect from 30.11.11)

Review of Operations and future plans of some of the Subsidiary Companies:

1. Blue Star Realtors Private Limited: The Company has received notification for IT-SEZ in Kochi. The Company proposes to monetize the same through strategic Joint Venture (JV) and Private Equity Investment.

2. Guruashish Construction Private Limited: The Company has a large Residential and Commercial project at Siddhartha Nagar at Goregaon Mumbai for 1,65,800 sq. mtr. of construction valued at Rs 48500.00 lacs.

3. HDIL Entertainment Private Limited: The Company proposes to spread its presence by opening of 3 screens in at a Multiplex Delhi, 2 screens in Multiplex at Baramati Near Pune, add 2 screens in a Multiplex at Mumbai and add

5 more screens in a Multiplex at Kolkata in the year 2012-13. The Company intends to reach its target of 100 screens all over India by the year 2014.

4. Privilege Power and Infrastructure Private Limited: The

Company is holding large land bank in Vasai and Virar belt having huge growth potential and proposes to monetize this very soon.

5. HC Infracity Private Limited: The Company is engaged in to Real estate development and has been allotted land in Yamuna expressway project in Delhi.

The Ministry of Corporate Affairs (MCA) vide its General Circular No. 3/2011 dated 21st February, 2011 read together with General circular No. 2/2011 dated 8th February, 2011 issued modifying their circular No. 5/12/2007—CL-III has granted general exemption under Section 212(8) of the Companies Act, 1956 to Companies from attaching the accounts of their subsidiaries in their annual reports subject to fulfillment of certain conditions prescribed. The Board of Directors of the Company at its Meeting held on 30th May, 2012 in line with the circular of MCA have passed the necessary resolution granting the requisite approvals for not attaching the Balance Sheet, statement of Profit & Loss Account, report of the Board of Directors and report of the auditors of each of the Subsidiary Companies to the accounts of the Company for the fiscal year 2011-12. The Company will make available these documents/details upon request by any Member of the Company at its Registered Office. As required by Accounting Standard-21 (AS-21) prescribed by the Companies (Accounting standards) Rules, 2006, the Company's consolidated financial statements included in this Annual Report incorporate the accounts of its subsidiaries. A summary of key financials of the HDIL Subsidiaries is also included in this Annual Report.

6. DEBENTURES

During the year under review, the Company has issued on private placement basis Secured Non-Convertible Redeemable Debentures of Rs 10 lacs each aggregating to Rs 9,250.00 lacs to various financial institutions/banks. Out of total Debentures issued, debentures amounting to Rs 166,750.00 lacs are listed on Bombay Stock Exchange Limited (BSE).The Debentures were given "A" rating by CARE.

An amount of Rs 82,250.00 lacs have been transferred to Debenture Redemption Reserve.

7. SHARE CAPITAL

Pursuant to the approval of the shareholders, the Company had on 9th September, 2010 issued and allotted 2,60,00,000 Share Warrants to Mr. Sarang Wadhawan Promoter of the Company on preferential basis. Out of the said warrants your Company has converted 40,00,000 warrants into equity shares of Rs 10/- each at a premium of Rs 265/- per equity share as on 31st March 2012. Subsequent to the issue of Equity Shares, the paid up Share Capital of the Company has been increased from Rs 41,500.40 lacs to Rs 41,900.40 lacs. The said 40,00,000 Equity Shares are listed on the Bombay Stock Exchange Limited (BSE) and National Stock Exchange of India Limited (NSE).

As per regulation 75 of the Securities and Exchange Board of India (Issue of Capital And Disclosure requirements) Regulations, 2009 amended upto 30/01/2012, the Warrants so issued needs to be fully subscribed and converted within 18 months from the date of warrants so issued. As on 31st March, 2012, outstanding 2,20,00,000 share warrants were not converted in to equity shares until the expiry of the 18 months period ending on 8th March, 2012 and accordingly the money lying with the Company against the outstanding warrants has been forfeited.

The Equity Shares of your Company continue to be listed on the Bombay Stock Exchange Limited (BSE) and National Stock Exchange of India Limited (NSE).

8. DIRECTORS

At the 16th Annual General Meeting, Shri Waryam Singh, Shri Ashok Kumar Gupta and Shri Satya Pal Talwar retire by rotation and being eligible, offer themselves for re-appointment. The above re-appointments form part of the Notice of the forthcoming 16th Annual General Meeting and the respective resolutions are recommended for your approval.

Profile of the Directors retiring by rotation and proposed to be re appointed as required under Clause 49 of the Listing Agreement, is part of the explanatory statement to the Notice of the 16th Annual General Meeting.

During the period under review, the composition of the Board underwent the following change:

Shri Surinder Kumar Soni has resigned from the directorship of the Company w.e.f. 15th November, 2011 due to his health related issues. The Board would like to place on record it's appreciation towards the contribution and guidance received from him during his tenure.

9. RESERVES

Your Company has transferred Rs 82,250.00 lacs to Debenture Redemption Reserve.

10. FIXED DEPOSITS

The Company has not accepted any deposits from the public within the meaning of Section 58A of the Companies Act, 1956, during the year under review.

11. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217 (2AA) of the Companies Act, 1956, with respect to Directors' responsibility statement, it is hereby confirmed:

a) That in the preparation of the annual accounts for the year ended 31st March, 2012, the applicable accounting standards have been followed and no material departures have been made from the same.

b) That the Directors have selected such accounting polices and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year.

c) That the Directors have 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.

d) That the Directors have prepared the annual accounts for the year ended 31st March, 2012 on a going concern basis.

12. CORPORATE GOVERNANCE

Your Company acknowledges its responsibilities to its Stakeholders and believes that Corporate Governance helps to achieve commitment and goals to enhance stakeholder value by focusing towards all stakeholders. Your Company maintains highest levels of transparency, accountability and good management practices through the adoption and monitoring of corporate strategies, goals and procedures to comply with its legal and ethical responsibilities. Your Company is committed to meeting the aspirations of all our stakeholders.

The Company is fully committed to and continues to follow procedures and practices in conformity with the Code of Corporate Governance enshrined in the Clause 49 VI of the Listing Agreement. A detailed report on Corporate Governance forms part of this Report. The Auditors' Certificate on compliance with Corporate Governance requirements by the Company is attached to the Corporate Governance Report.

13. SECRETARIAL AUDIT

As per SEBI requirement, Secretarial Audit is being carried out at specific periodicity by a practicing Company Secretary. The findings of the audit have been satisfactory.

14. LISTING FEES

The equity shares of the Company are listed at the Bombay Stock Exchange Limited (BSE) and the National Stock Exchange of India Limited (NSE). The Company has paid the applicable listing fees to the above stock exchanges up to date. The Company's shares are also traded in the dematerialised segment for all investors compulsorily and the Company had entered into agreements with the Central Depository Services (India) Limited (CDSL) and National Securities Depository Limited (NSDL) for custodial services.

15. STATUTORY AUDITORS

M/s. Thar & Co., Chartered Accountants, the Statutory Auditors of the Company retires at the ensuing Annual General Meeting and offers themselves for re-appointment. A Certificate from them has been received to the effect that their re-appointment as Statutory Auditors of the Company, if made, would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.

With respect to the Auditors observation regarding the payment of statutory dues mentioned in their report, the Company has made payment of such dues subsequently.

16. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The management continuously reviews the internal control systems and procedures for the efficient conduct of the Company's business. The Company adheres to the prescribed guidelines with respect to the transactions, financial reporting and ensures that all its assets are safeguarded and protected against losses. The Internal Auditor of the Company conducts the audit on regular basis and the Audit Committee actively reviews internal audit reports and effectiveness of internal control systems.

Internal Control Systems are implemented to safeguard the Company's assets from loss or damage, to keep constant check on the cost structure, to prevent revenue leakages, to provide adequate financial and accounting controls and implement accounting standards.

To facilitate improved efficiency in Business Operations, SAP Business ERP system is being used for integrating all Business Functions of the Company from Planning, Execution, Monitoring and Control of the Projects including MIS of the Business Operations thereby enhancing the efficiency of the Business Operations. As mandated by the Central Government the Company is taking necessary steps to comply with the requirement of maintaining cost account record.

17. INVESTORS' RELATION AND GRIEVANCES

Investors' relations have been cordial during the year. As a part of compliance, the Company has formed Investor Grievance and Share Transfer Committee to deal with the issues relating to investors. There were no investors' grievances pending as on 31st March, 2012. A confirmation to this effect has been received from the Company's Registrar and Share Transfer Agent.

18. PARTICIPATION IN THE GREEN INITIATIVE

Your Company continues to wholeheartedly participate in the Green Initiative undertaken by the Ministry of Corporate Affairs (MCA) for correspondences by Corporates to its shareholders through electronic mode. All the shareholders are requested to join the said program by sending their preferred e-mail addresses to the Registrar and Share Transfer Agent.

19. CSR ACTIVITIES

The details of the CSR activities undertaken by the Company forms part of the Corporate Governance Report.

20. CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGICAL ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in terms of Section 217(1) (e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, for the year ended 31st March 2012.

1. CONSERVATION OF ENERGY

Your Company is conscious about its responsibility to conserve energy, power and other energy sources wherever possible. We emphasis towards a safe and clean environment and continue to adhere to all regulatory requirements and guidelines. The construction team under the able guidance of expert engineers of the Company continuously strives and devises various means to conserve energy and identify methods for optimum use of energy.

Initiatives are taken for energy efficiency systems for Buildings in various phases like design, building and occupation by considering various options and appropriate measures for energy conservation, use of single glazing/ double glazing, use of UPVC doors/windows, using BMS systems etc.

2. RESEARCH AND DEVELOPMENT

The Company has undertaken Research and Development (R&D) activity in development of technology in the area of construction.

In today's competitive market where it is obvious need to construct with optimum cost, reduced schedule while maintaining highest standard of quality, our Company is actively involved in R&D activities. Some of them are;

- Substitution of Diaphragm wall with sheet piling as shoring options.

- Study, Analysis and use of composite structure in place of conventional structure.

- Study, Analysis and use of various shuttering patterns for economy and conservation time.

- Optimisation of resources and their recycling for further use.

- Use of environment friendly materials and developing green building concept.

- analysis and study of trade off among various services for optimisation.

Emphasis is given on time, cost and quality and setting an efficient trade off among these three variables of Project management in R&D efforts.

3. TECHNOLOGICAL ABSORPTION

Your Company has not imported any technology. However, we believe and use information technology extensively in all spheres of our activities to improve efficiency levels.

4. FOREIGN EXCHANGE EARNINGS AND OUTGO

(Rs in Lacs)

Year 2011-12 2010-11

Foreign exchange earnings - -

Foreign exchange outgo 50.31 268.75

21. PARTICULARS OF EMPLOYEES

Your Directors place on record their deep appreciation for the contribution made by the employees of the Company at all levels. Relations between employees and the management continued to be cordial during the year.

Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, forms part of this Report. However, as per the provisions of Section 219 (1) (b) (iv) of the Companies Act, 1956, this Report and Accounts are being sent to all the Members of the Company, excluding the Statement of Particulars of Employees. Any member interested in obtaining a copy of the said statement may write to the Company Secretary of the Company.

22. ACKNOWLEDGEMENT

Your Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by the employees of the Company and its subsidiaries at all levels and wish to convey their appreciation to the Banks, Financial Institutions, Government Authorities, customers and other business associates for the excellent assistance and co-operation received and wish to place on record their gratitude to the members for their trust, support and confidence.

For and on behalf of the Board of Directors

Place: Mumbai Rakesh Kumar Wadhawan

Date: 30th May, 2012 Executive Chairman


Mar 31, 2011

The Directors are pleased to present the 15th Annual Report on the business and operations of the Company together with the audited accounts for the financial year ended 31st March, 2011.

1. FINANCIAL PERFORMANCE

(Rs. In Lacs)

Particulars 2010-11 2009-10

Gross sales and other receipts 1,92,276 1,59,958

Profit before interest, depreciation, 1,64,374 1,25,680 amortisation and taxation

Interest 57,796 51,642

Depreciation and Amortisation 725 510

Operational profit before tax 1,05,853 73,528

Less: Exceptional items 450 -

Less: Provision for Tax and other 15,667 13,862 adjustments

Profit afiter taxation and 89,736 59,666 other adjustments

Balance brought forward 58,292 60,542

Profit available for appropriation 1,48,028 1,20,208

Less: Transferred to General Reserve 58,292 -

Less: Debentures Redemption Reserve 43,334 61,916

Profit carried to Balance Sheet 46,402 58,292

Net Worth 9,63,709 7,11,774

2. OPERATIONS

The Turnover of the Company increased by 20.20% and stood at Rs. 1,92,276 lacs as against Rs. 1,59,958 Lacs in the previous year. The Companys Profit from Operations for the year ended 31st March, 2011 increased by 43.35 % to Rs. 1,05,403 lacs as against Rs. 73,528 lacs in the corresponding period of the previous year. Company launched Residential as well as Commercial projects admeasuring 57,40,218 sq. fit. of saleable area. Details of Projects forms part of the Managements Discussion and Analysis forming part of the report appearing separately in the annual report.

During the year under review there was accidental fire on 18th November, 2010 at the office premises due to this, the equipments, computer systems, statutory records, registers, correspondence and drawing plans were extensively damaged. Exceptional loss of Rs. 450 lacs represents net write off to Profit and Loss Account on account of accidental fire. There was no casualty in the said mishap.

3. DIVIDEND

With a view to control Inflationary trend, Government/RBI has implemented such policy that restricts the investments in the real estate sector, thereby, affecting availability of liquidity in the business. Given the circumstances, Board deems it fit not to recommend payment of any Dividend for the year and conserve resources.

4. MANAGEMENTS DISCUSSION AND ANALYSIS

A detailed review of the operations, performance and future outlook of the Company and its businesses is given in the Managements Discussion and Analysis, which forms part of this Report as Annexure II.

5. SUBSIDIARY COMPANIES

As at 31st March, 2011, Your Company had 10 subsidiaries as listed below:

1. Blue Star Realtors Private Limited;

2. BKC Developers Private Limited;

3. Excel Arcade Private Limited;

4. Guruashish Construction Private Limited;

5. HDIL Commercial Properties Private Limited (formerly known as HDIL Leisure Pvt. Ltd.)

6. HDIL Entertainment Private Limited;

7. Lashkaria Construction Private Limited; (w.e.f. 12th October, 2010)

8. Mazda Estates Private Limited;

9. Privilege Power and Infrastructure Private Limited and

10. Ravijyot Finance and Leasing Private Limited

All the above companies are non-material, non-listed subsidiary companies as defined under Clause 49 of the Listing Agreements entered into with the stock exchanges.

The Ministry of Corporate Affairs (MCA) vide its Circular No. 5/12/2007 – CL-III dated 8th February, 2011 has granted general exemption under Section 212(8) of the Companies Act, 1956 to companies from attaching the accounts of their subsidiaries in their annual reports subject to fulfillment of certain conditions prescribed. The Board of Directors of the Company at its Meeting held on 27th May, 2011 noted the provisions of the circular of MCA and passed the necessary resolution granting the requisite approvals for not attaching the Balance Sheet, Profit and Loss Account, report of the board of directors and report of the auditors of each of the subsidiary companies to the accounts of the Company for fiscal 2011. The Company will make available these documents/details upon request by any Member of the Company at its Registered Office and also at the registered offices of the concerned subsidiaries. As required by Accounting Standard–21 (AS – 21) issued by the Institute of Chartered Accountants of India, the Companys consolidated financial statements included in this Annual Report incorporate the accounts of its subsidiaries. A summary of key financials of the HDIL Subsidiaries is also included in this Annual Report.

6. DEBENTURES

During the year under review, the Company has issued on private placement basis Secured Non-Convertible Redeemable Debentures of Rs. 10 lacs each aggregating to Rs. 35,000 lacs to various financial institutions/banks. Debentures amounting to Rs. 157,500 lacs out of total Debentures aggregating to Rs. 1,66,750 lacs are listed at Bombay Stock Exchange Limited (BSE). During the year, Non-Convertible Redeemable Debentures aggregating to Rs. 28,820 lacs have been redeemed. The Companys debt has been rated by CARE with "A+" rating.

An amount of Rs. 43,334 lacs has been transferred to Debenture Redemption Reserve.

7. SHARE CAPITAL

During the year 2010-2011, your Companys issued, subscribed and paid up share capital has increased in the following manner:

1. On 29th July, 2010, Company has allotted 50,00,000 equity shares of Rs. 10/- each at a premium of Rs. 230/- per equity share from the balance 50,00,000 warrants issued to Mr. Rakesh Kumar Wadhawan, Promoter of the Company on preferential basis as per SEBI (ICDR) Regulations, 2009. Subsequent to the issue of Equity Shares to Mr. Rakesh Kumar Wadhawan, the paid up Share Capital of the Company has been increased from Rs. 36,684.26 lacs to Rs. 37,184.26 lacs.

2. On 17th September, 2010, Company has allotted 43,161,310 equity shares of Rs. 10/- each at a premium of Rs. 258.18/- per equity share aggregating to Rs. 1,15,750 lacs to Qualified Institutional Buyers. Subsequent to the issue of Equity Shares to the Qualified Institutional Buyers, the paid up Share Capital of the Company has been increased from Rs. 37,184.26 lacs to Rs. 41,500.40 lacs.

Pursuant to the approval of shareholders in the 14th Annual General Meeting for issue of Convertible Warrants to Mr. Sarang Wadhawan, your Company have allotted 2,60,00,000 Convertible Warrants of Rs. 10/- each at a premium of Rs. 265/- per Warrant to Mr. Sarang Wadhawan, Promoter of the Company. Company has received the subscription amount as prescribed under SEBI (ICDR), Regulations, 2009 from Mr. Sarang Wadhawan.

The Paid-up Share Capital of your Company as on 31st March, 2011 was Rs. 41,500.40 lacs comprising of 41,50,03,986 Equity Shares of Rs. 10/- each.

The Equity Shares of your Company continue to be listed on the Bombay Stock Exchange Limited (BSE) and National Stock Exchange of India Limited (NSE).

8. DIRECTORS

Mr. Sarang Wadhawan has been re-appointed as a Managing Director of the Company for the period of five years with effect from 1st April, 2011.The terms and conditions of his re-appointment, including his remuneration, are subject to approval of the Members.

At the 15th Annual General Meeting, Mr. Lalit Mohan Mehta, Mr. Shyam Sunder Dawra and Mr. Sunil Behari Mathur retire by rotation and being eligible, offer themselves for re-appointment.

The above re-appointments form part of the Notice of the forthcoming 15th Annual General Meeting and the respective resolutions are recommended for your approval.

Profile of the Directors, as required under Clause 49 of the Listing Agreement, is part of the explanatory statement to the Notice of the 15th Annual General Meeting.

9. GROUP

The names of the Promoters and entities comprising the group are disclosed in the Annual Report for the purpose of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 as Annexure IV.

10. RESERVES

Your Company has transferred Rs. 43,334 lacs to Debenture Redemption Reserve and Rs. 58,292 lacs to General Reserve. With this addition, the total General Reserves of the Company stood at Rs. 3,27,662 lacs.

During the year, due to issue of equity shares by way of QIP/ allotment of warrants there has been addition of Rs. 1,38,462 lacs to Securities Premium Account.

11. CASH FLOW STATEMENT

In conformity with the provisions of Clause 32 of the Listing Agreement with the Stock Exchanges, the cash flow statement for the year ended 31st March, 2011 is annexed hereto.

12. FIXED DEPOSITS

The Company has not accepted any deposits from the public within the meaning of Section 58A of the Companies Act, 1956, during the year under review.

13. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217 (2AA) of the Companies Act, 1956, with respect to Directors responsibility statement, it is hereby confirmed:

a) That in the preparation of the annual accounts for the year ended 31st March, 2011, the applicable accounting standards have been followed and no material departures have been made from the same.

b) That the Directors have selected such accounting polices and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year.

c) That the Directors have 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.

d) That the Directors have prepared the annual accounts for the year ended 31st March, 2011 on a going concern basis.

14. CORPORATE GOVERNANCE

We adhere to the principles of Corporate Governance mandated by the Securities and Exchange Board of India and have implemented all the prescribed stipulations. As required by Clause 49 VI of the Listing Agreement, a detailed report on Corporate Governance forms part of this Report as Annexure III. The Auditors Certificate on compliance with Corporate Governance requirements by the Company is attached to the Corporate Governance Report.

The Board of Directors has perused the Corporate Governance Voluntary Guidelines 2009 issued by the Ministry of Corporate Affairs and have already adopted most of the recommendations of the guidelines and recognises the importance of continuous assessment of governance practices to create long-term value for the stakeholders. The board would consider adopting the remaining provisions of the said guidelines as and when deemed appropriate.

15. SECRETARIAL AUDIT

As per SEBI requirement, Secretarial Audit is being carried out at specific periodicity by a practicing Company Secretary. The findings of the audit have been satisfactory.

16. LISTING FEES

The equity shares of the Company are listed at the Bombay Stock Exchange Limited (BSE) and the National Stock Exchange of India Limited (NSE). The Company has paid the applicable listing fees to the above stock exchanges up to date. The Companys shares are also traded in the dematerialised segment for all investors compulsorily and the Company had entered into agreements with the Central Depository Services (India) Limited (CDSL) and National Securities Depository Limited (NSDL) for custodial services.

17. AUDITORS

M/s. Thar & Co., Chartered Accountants, the Statutory Auditors of the Company retires at the ensuing Annual General Meeting and offers themselves for re-appointment. A Certificate from them has been received to the effect that their re-appointment as Statutory Auditors of the Company, if made, would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.

18. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The management continuously reviews the internal control systems and procedures for the efficient conduct of the Companys business. The Company adheres to the prescribed guidelines with respect to the transactions, financial reporting and ensures that all its assets are safeguarded and protected against losses. The Internal Auditor of the Company conducts the audit on regular basis and the Audit Committee actively reviews internal audit reports and effectiveness of internal control systems.

Internal Control Systems are implemented to safeguard the Companys assets from loss or damage, to keep constant check on the cost structure, to prevent revenue leakages, to provide adequate financial and accounting controls and implement accounting standards.

19. INVESTORS RELATION AND GRIEVANCES

Investors relations have been cordial during the year. As a part of compliance, the Company has formed Investor Grievance and Share Transfer Committee to deal with the issues relating to investors. There were no investors grievances pending as on 31st March, 2011. A confirmation to this effect has been received from the Companys Registrar and Share Transfer Agent.

Green Initiative

Recently Ministry of Corporate Affairs (MCA) has initiated correspondences by Corporates to shareholder through electronic mode; the Company has decided to participate wholeheartedly in the said initiative. All the shareholders are requested to join the said program by sending their preferred e-mail addresses to the Registrar and Share Transfer Agent.

20. CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGICAL ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in terms of Section 217(1) (e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are set out in the Annexure I to this report.

21. PARTICULARS OF EMPLOYEES

Your Directors place on record their deep appreciation for the contribution made by the employees of the Company at all levels. Relations between employees and the management continued to be cordial during the year.

Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, forms part of this Report. However, as per the provisions of Section 219 (1) (b) (iv) of the Companies Act, 1956, this Report and Accounts are being sent to all the Members of the Company, excluding the Statement of Particulars of Employees. Any member interested in obtaining a copy of the said statement may write to the Company Secretary of the Company.

22. ACKNOWLEDGEMENT

Your Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by the employees of the Company and its subsidiaries at all levels and wish to convey their appreciation to the Banks, Financial Institutions, Government Authorities, customers and other business associates for the excellent assistance and co-operation received and wish to place on record their gratitude to the members for their trust, support and confidence.

For and on behalf of the Board of Directors

Date: 27th May, 2011 Rakesh Kumar Wadhawan

Place: Mumbai Executive Chairman