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Directors Report of Prestige Estates Projects Ltd.

Mar 31, 2015

Dear Members,

The Directors are pleased to present their Eighteenth Annual Report on the business operations of the Company for the year ended on 31st March 2015.

FINANCIAL HIGHLIGHTS

Rs. In Mn

Standalone Results

Particulars 31st March 31st March 2015 2014

Income

Revenue from Operations 23,743.40 20,051.90

Other Income 1,986.90 1,472.60

Total Revenue 25,730.30 21,524.50

Expenses

Purchase of stock of units 568.90 513.60

Cost of contractual projects - -

Cost of sales on Projects 12,878.70 11,344.10

Property & Facilities Operating Expenses 1,610.50 1,204.30

Employee benefit expenses 1,308.40 877.60

Finance Costs 1,882.80 1,260.50

Depreciation & Amortization Expenses 422.50 355.40

Other Expenses 1,153.70 1,086.80

Total Expenses 19,825.50 16,642.30

Profit before Tax 5,904.80 4,882.20

Tax Expenses 1,762.50 1,482.00

Profit for the year after taxes 4,142.30 3,400.20

Share of profit / (loss) of associates - - (Net)

Profit after tax (before adjustment for - - Minority interest)

Share in (profit) / loss attributable - - to Minority interest

Profit for the year after taxes 4,142.30 3,400.20

Rs. In Mn

Particulars Consolidated Results

31st March 31st March 2015 2014

Income

Revenue from Operations 34,197.60 25,491.90

Other Income 986.40 975.00

Total Revenue 35,184.00 26,466.90

Expenses

Purchase of stock of units 140.60 513.60

Cost of contractual projects 489.00 625.30

Cost of sales on Projects 15,721.30 11,198.70

Property & Facilities Operating Expenses 3,913.60 2,877.00

Employee benefit expenses 2,290.30 1,609.70

Finance Costs 3,213.60 2,290.40

Depreciation & Amortization Expenses 1,397.00 892.60

Other Expenses 1,704.20 1,464.30

Total Expenses 28,869.60 21,471.60

Profit before Tax 6,314.40 4,995.30

Tax Expenses 2,646.90 1,750.40

Profit for the year after taxes 3,667.50 3,244.90

Share of profit / (loss) of associates 7.40 -30.10 (Net)

Profit after tax (before adjustment for - 3,674.90 3,214.80 Minority interest)

Share in (profit) / loss attributable - -351.20 -72.00 to Minority interest

Profit for the year after taxes 3,323.70 3,142.80

There have been no material changes or commitments affecting the financial position of the Company which have occurred between 31st March 2015 and the date of this report.

Business

Business Overview

Prestige Estates Projects Limited is a public limited company listed on National Stock Exchange of India Limited and Bombay Stock Exchange of India Limited. The details of Equity capital of the Company is as under:

Authorized Capital

No. of shares Amount (Rs) 40,00,00.000 4,00,00,00,000

Issued Capital

No. of shares Amount (Rs) 37,50,00,000 3,75,00,00,000

Subscribed Capital

No. of shares Amount (Rs) 37,50,00,000 3,75,00,00,000

Paid Up Capital

No.of shares Amount (Rs) 37,50,00,000 3,75,00,00,000

Real estate development business, which is our principal business focuses on the development of real estate projects in the residential (including plotted developments), commercial (including built to suit developments), hospitality and retail segments of the real estate industry. In addition, we generate revenues from leasing commercial, hospitality and retail space.

Our real estate services business, focuses on property management services for our real estate projects, sub leasing and fit out services, project and construction management services and mall management and facilities management (including the operation of our hospitality business) services.

The following diagram illustrates the sub segments of our real estate development business:

RESIDENTIAL

Apartments Villas

Integrated Townships Plotted Developments

COMMERCIAL

Office Space Built to suit campuses SEZs IT Parks

Our Business

RETAIL

Malls

HOSPITALITY

Resorts

Serviced Apartments

Hotels

Food Courts

SERVICES

Sub leasing & fitout services

Interior Design & Execution

Facilities & Property Management

Project & Construction Management Services

Financial Overview

During the fiscal year 2014-15, on a consolidated basis, the Company has registered revenue of Rs. 35,184 mn, up by 33% from Rs. 26,467 mn in FY14. Further it has reported EBIDTA of Rs. 10,925 mn, up by 34% from Rs. 8,179 mn in FY14 and PAT of Rs. 3,675 mn, up by 14.31% from Rs. 3,215 mn in FY14.

Operational Overview

Sales:

The Company has for the year ended 31st March 2015 sold 4,058 Residential units & 0.81 mn square feet of Commercial space, totaling to 7.73 mn square feet, amounting to Rs. 50,135 mn of Sales, up by 13% from that of FY14. (Of this, Prestige share is 3,716 residential units totaling to 6.69 mn square feet amounting to Rs. 43,625 mn of Sales, up by 20% from that of FY14.)

The sales for FY 2014-15 are as under:

Particulars Q1FY15 Q2FY15 Q3FY15 Q4FY15 FY15

Sales (Rs. Mn) 14,073 14,859 10,094 11,109 50,135

Area (Mnsf) 227 245 1.55 1.46 7.73

No. of Units 1,277 1,375 611 795 4,058

Collections:

Total collections for the year ended 31st March 2015 aggregated to Rs. 38,843 mn, up by 32% from that of FY14. (Prestige share is Rs. 32,316 mn, up by 31% from that of FY14).

Total collections for FY14 were Rs. 29,408 mn and Prestige share of collections were Rs. 24,753 mn. Launches:

The Company has launched 14.63 mn square feet of developable area during FY 14-15.

Completions:

The Company has delivered 8.92 mn square feet of developable area during FY 14-15.

CHANGES TO EQUITY SHARE CAPITAL

During the year, 2014-15, the Company has issued and allotted 2,50,00,000 equity shares of Rs. 10 each on 12th August, 2014 at the Issue Price of Rs. 245 per Equity Share (including Rs. 235 per share towards securities premium) against the receipt of full and final payment of application money aggregating to Rs. 6,12,50,00,000/- through private placement to Qualified Institutional Buyers such as Foreign Institutional Investors registered with SEBI and mutual funds.

DIVIDEND

Your Board of Directors has recommend a dividend of Rs. 1.50 per equity share, (previous year Rs. 1.50 per share) for the year ended 31st March 2015 amounting to pay-out of Rs. 674.97 mn (inclusive of dividend distribution tax of Rs. 112.47 mn) for consideration and approval by the shareholders at the ensuing Annual General Meeting.

TRANSFER TO RESERVES

There is no transfer to general reserve during the year 2014-15.

DETAILS RELATING TO DEPOSITS

The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.

CHANGE IN DIRECTOR AND KEY MANAGERIAL PERSONNEL

During the 17th Annual General Meeting of the Company, the Members had re-appointed Mr. Irfan Razack who was liable to retire by rotation. Mr. Jagadeesh K Reddy, Mr. Biji George Koshy, Dr. Pangal Ranaganath Nayak and Mr. Noor Ahmed Jaffer were appointed as the Independent Directors of the Company for a period of five years from the conclusion of 17th Annual General Meeting.

During the year, Ms. Uzma Irfan was appointed as an Additional Director of the Company with effect from 11th November, 2014.

Pursuant to the provisions of Section 203 of the Act, which came into effect from 1st April, 2014, the appointments of Mr. Irfan Razack, Chairman and Managing Director, Mr. Rezwan Razack, Joint Managing-Director, Mr. Noaman Razack, Whole-time Director, Mr. Venkat Narayana, Chief Financial Officer and Ms. Medha Gokhale, Company Secretary as key managerial personnel of the Company were formalized.

CHANGES IN SUBSIDIARIES & ASSOCIATES

The Company has 23 subsidiaries as on 31st March, 2015. There are 5 associate companies within the meaning of Section 2(6) of the Companies Act, 2013 ("Act"). There has been no material change in the nature of the business of the subsidiaries.

During the year, the Company has increased its stake in Prestige Garden Constructions Private Limited from 35% to 50%. The Company has also increased its stake in Prestige Notting hill Investments from 47% to 51%. Valdel Xtent Outsourcing Solutions Private Limited, the subsidiary Company has acquired 65.92% stake in Dollars Hotel & Resorts Private Limited, making it a step down subsidiary of the company.

Pursuant to provisions of Section 129(3) of the Act, a statement containing salient features of the financial statements of the Company's subsidiaries in Form AOC-1 is attached to the financial statements of the Company.

Pursuant to the provisions of section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited accounts in respect of subsidiaries, are available on the website of the Company.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS:

During the year 2014-15 there were no significant and material orders passed by the regulators or Courts or Tribunals impacting the going concern status and the company's operations in future.

BOARD OF DIRECTORS

The Company's Board consists of an appropriate mix of Executive and Independent Directors. Currently, the Board consists of 8 Directors including an Executive Chairman, 3 Executive Directors and 4 Independent Directors.

COMMITTEES OF BOARD OF DIRECTORS

The details on Committees of Board of Directors, composition and roles & responsibilities are stated in the Corporate Governance Report which forms part of this report.

INTERNAL FINANCIAL CONTROLS

There are adequate internal financial controls in place with reference to the financial statements.

MEETINGS OF THE BOARD OF DIRECTORS

During the year 2014-15, four meetings of the Board of Directors were held. The details of the meeting along with the attendance of Directors are stated in the Corporate Governance Report which forms part of this report.

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from each Independent Director of the Company under Section 149(7) of the Companies Act, 2013 that they meet with the criteria of their Independence laid down in Section 149(6).

POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAILS

The Company's policy on directors' appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the corporate governance report, which forms part of the directors' report. The policy has also been uploaded on the website of the Company.

EXTRACT OF ANNUAL RETURN

As required pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of annual return in MGT 9 forms part of this Annual Report as Annexure 1.

CORPORATE GOVERNANCE

The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges, forms part of this Report. The Certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under the aforementioned Clause 49 is also attached to this Report.

MANAGEMENT DISCUSSION & ANALYSIS REPORT

Management Discussion and Analysis Report as required under Clause 49(VIII)(D) is attached along with this Report.

AUDITORS & AUDIT REPORT

Pursuant to the provisions of Section 139 of the Act and the rules framed thereunder, Deloitte Haskins & Sells, Chartered Accountants, were appointed as statutory auditors of the Company from the conclusion of the seventeenth annual general meeting (AGM) of the Company till the conclusion of the twentieth AGM to be held in the year 2017, subject to ratification of their appointment at every AGM.

Report by the Auditors for the year ended 31st March 2015 forms part of the Financials.

Pursuant to Section 204 of the Companies Act 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Secretarial Audit has been carried out by Mr. Nagendra D Rao, Practicing Company Secretary. Report of the secretarial auditor is given as an Annexure 2 which forms part of this report.

Remark: There have been instances of delay in depositing statutory dues.

Reply: In the opinion of the Board, the instances of delay in depositing statutory dues were on account of temporary mismatch in Cash Flows. The Board has set up good system to ensure timely deposit of statutory dues in future.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO Conservation of Energy:

The Company has made energy saving efforts wherever possible. As part of Green Initiative, IGBC- LEED requirements and Energy conservation code, following energy conservation measures have been taken in our various projects:

* Use of solar lighting for landscape

* Use of VFD's

* Use of CFLs, LED's in lighting of common areas

* Conform to lighting power density requirements as per Green building norms for basements, driveways and other common areas

* Use of glass on external facade to maximize daylight views with appropriate shading coefficients, solar factor and solar heat gain coefficient

* Use of daylight sensors in office areas

* Use of lighting management system with timers for external lighting

* Use of surface reflective paint for reducing heat island effect and thereby reduce A/C loads

The Company's initiative of Green Building in one of its projects in subsidiary company, i.e. Cessna Business Park, has been awarded Platinum Certification under USGB's LEED ID C rating system. This is the highest rated Platinum LEED ID C projects in Asia and the second highest in the world having been awarded a total of 97 points by the U.S Green Building Council.

The projects Prestige Palladium Bayan and Prestige Polygon at Chennai have achieved precertification under the LEED India for Core & Shell Rating System.

Technology Absorption:

The Company as a part of progressive growth is always on the lookout for new technological innovations that can enhance the product quality, increase process speed, reduces adverse impact on the environment. Some of the measures used are:

* Use of low flow toilet fixtures with sensors, concealed valves, etc

* Use of STP treated water for flushing, landscaping and air-conditioning

* Harvesting rain water in the form of deep well recharging, collection, treatment and use of terrace storm water, etc

* Increased use of water cooled chillers

* Installation of organic waste convertors in large residential projects

* Use of centralised LPG reticulation system with piped gas supply to individual flats

* Use of CCTV, door video phones to enhance security

* Use of modular toilet partitions in lieu of conventional block work, tiling and wooden flush doors

* Use of in situ concrete load bearing walls constructed using aluminum formwork instead of RCC framed structure in-filled with block masonry that would be plastered on both internal and external faces

Research and Development:

The Company has verified and on research has adopted best suitable methods for execution of the projects. Some of such methods are listed here below:

* Adoption of pre-polished cut-to-size engineered stone flooring as against unpolished random slabs that caused large wastages in terms of time and effort put in for cutting, lifting, placing and polishing

* Introduction of laminated wooden flooring for faster and cleaner execution in place of conventional tiled flooring

* Use of soil nailing, shotcreting /guniting for stabilising steep slopes of excavation

* Use of chemical stabilisation techniques by using admixtures of available soil for road sub-base construction

* Introduction of non-destructive testing like Pile Dynamic Analyser test to reduce the dependency on conventional maintained pile load test, use of pile integrity test for assessing soundness of concrete in piled foundation

Foreign exchange earnings and outgo:

Foreign exchange earned during the year is equivalent to Rs. 25.60 mn (previous year Rs. 50.40 mn) and the expenditure is Rs. 593.30 mn (previous year Rs. 364.10 mn).

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

The particulars of loans, guarantees and investments have been disclosed in the financial statements.

RISK MANAGEMENT:

The Board of the Company has formed a risk management committee to frame, implement and monitor the risk management plan for the Company. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The audit committee has additional oversight in the area of financial risks and controls. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. The development and implementation of risk management policy has been covered in the management discussion and analysis, which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY POLICY & INITIATIVES:

Pursuant to the provisions of section 135 and schedule VII of the Companies Act, 2013, CSR Committee of the Board of Directors was formed to recommend (a) the policy on Corporate Social Responsibility (CSR) and (b) implementation of the CSR Projects or Programs to be undertaken by the Company as per CSR Policy for consideration and approval by the Board of Directors.

The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure 3 of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. The policy is available on the website of the Company.

RELATED PARTY TRANSACTIONS:

None of the transactions with related parties falls under the scope of Section 188(1) of the Act. Information on transactions with related parties pursuant to Section 134(3)(h) are detailed in the notes to accounts in the Financial Statements of the Company.

VIGIL MECHANISM:

The Company has formulated and published a whistle blower policy to provide vigil mechanism for employees including directors of the Company to report genuine concerns. The provisions of this policy are in line with Section 177(9) of the Act and the revised clause 49 of the Listing agreement.

FORMAL ANNUAL EVALUATION:

The board of directors has carried out an annual evaluation of its own performance, Board committees and individual directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by Securities and Exchange Board of India ("SEBI") under Clause 49 of the Listing Agreements ("Clause 49").

The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the Board composition and structure, effectiveness of board processes, information and functioning, etc.

The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc.

The Board reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the Chairman was also evaluated on the key aspects of his role.

In a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of the independent Directors, at which the performance of the Board, its committees and individual directors was also discussed.

PARTICULARS OF EMPLOYEES

Information as required under the provisions of Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are detailed in Annexure 4 to this report.

DIRECTORS' RESPONSIBILITY STATEMENT

In pursuance of section 134 (5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, hereby confirm that:

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;

(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) the directors had prepared the annual accounts on a going concern basis;

(e) the directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

(f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively

ACKNOWLEDGEMENTS

The Board of Directors sincerely thank the Company's valued customers, clients, suppliers, vendors, investors, bankers and shareholders for their trust and support towards the Company. The Board expresses its deepest sense of appreciation to all the employees whose professional committed initiative has laid the foundation for the organization's growth and success.

For and on behalf of the board

Sd/- Sd/- Irfan Razack Rezwan Razack Chairman & Managing Director Joint Managing Director

Place: Bengaluru Date: 30 May 2015


Mar 31, 2014

Dear Shareholders,

The Directors are pleased to present their Seventeenth Annual Report of the business operations and the financial accounts of the Company for the year ended on March 31, 2014.

1. financial highlights

(? in Mn)

Particulars Standalone results Consolidated results

March 31, March 31, March 31, March 31, 2014 2013 2014 2013

Net Sales/ Income 21,525 16,063 26,467 20,112

Total expenditure 15,026 10,950 18,289 13,685

Profit before interest, depreciation, exceptional items and taxes 6,498 5,113 8,178 6,427

Less: Interest 1,261 897 2,290 1,489

Profit before depreciation, exceptional items and taxes 5,238 4,216 5,888 4,938

Less: Depreciation 355 330 893 682

Profit before exceptional items and taxes 4,882 3,886 4,995 4,256

Less: Exceptional items 0 0 0 0

Profit before taxes 4,882 3,886 4,995 4,256

Less: Provision for current taxation 1,524 1,135 1,798 1,331

Less/(Add): Income tax pertaining to earlier years 16 -4 30 30

Less/(Add): MAT Credit entitlement - - -30 -38

Less/(Add): Deferred taxation -58 -6 -48 -9

Profit after taxes 3,400 2,761 3,245 2,942

Share of profit from associates (Net) 0 0 -30 -33

Share in (Profit) / loss to minority interest 0 0 -72 -48

Adjustment on disinvestment in subsidiary companies 0 0 0 0

Adjustment arising on consolidation 0 0 0 0

Balance available for appropriation 3,400 2,761 3,143 2,860

Transfer to general reserve 170 69 170 69

Proposed dividend 525 420 525 420

Dividend distribution tax 89 71 89 71

Balance carried to balance sheet 2,620 2,200 2,359 2,299

(a) the year 2013-14 - financial Performance

Standalone financial Performance

- Revenue at Rs. 21,525 million, up by 34% as compared to the corresponding previous year (FY13) revenue of Rs. 16,064 million.

- EBIDTA at Rs.6,498 million, up by 27% as compared to the corresponding previous year (FY13) EBIDTA of Rs. 5,113 million.

- PAT at Rs.3,400 million, up by 23% as compared to the corresponding previous year (FY13) PAT of Rs. 2,760 million.

A detailed comparative summary of the standalone financial performance is as under:

Particulars FY 13-14 FY 12-13 Growth

Turnover (Rs. Mn) 21,525 16,064 34%

EBITDA (Rs. Mn) 6,498 5,113 27%

PAT (Rs. Mn) 3,400 2,760 23%

PAT % 16% 17% -6%

WACC 12.75% 13.01% 2%

D/E Ratio (Number of times) 0.46 0.37 -24%

consolidated financial Performance

- Consolidated Revenue at Rs. 26,467 million, up by 32% as compared to the corresponding previous year (FY13) consolidated revenue of Rs. 20,112 million.

- EBIDTA at Rs.8,076 million, up by 27% as compared to the corresponding previous year (FY13) consolidated EBIDTA of Rs. 6,345 million.

- PAT at Rs.3,215 million, up by 11% as compared to the corresponding previous year (FY13)consolidated PAT of Rs. 2,908 million.

A detailed comparative summary of the consolidated financial performance is as under:

Particulars FY 13-14 FY 12-13 Growth

Consolidated Turnover (Rs. Mn) 26,467 20,112 32%

Consolidated EBIDTA (Rs. Mn) 8,076 6,345 27%

Consolidated EBIDTA % 31% 32% -3%

Consolidated PAT (Rs. Mn) 3,215 2,908 11%

Consolidated PAT % 12% 14% -14%

Consolidated D/E Ratio (Number of times) 0.77 0.60 -28.33%

2. REVIEW OF OPERATIONS

Operational Highlights

- The Company has sold, for the year ended 31st March 2014, 4486 residential units and 0.22 Mnsft of commercial space, totaling to 7.5 Mnsft, amounting to Rs. 44,348 million. (PEPL Share: Rs. 36,323 million).

- For the year ended March 31, 2014, the average realization achieved is up by 13% at Rs. 5,912 per Sft as compared to the corresponding previous year''s average realization of Rs. 5,220 per Sft.

- Completed and delivered 3.18 million square feet of Commercial Office space.

- Registered total new leasing at 2.66 million square feet.

- The total collections for the year ended March 31, 2014 aggregated to Rs. 29,408 million as against Rs.19,695 millionof the previous year thereby recording a growth of 26%.

A detailed comparative summary of the operational performance is as under:

Particulars FY 13-14 FY 12-13 Growth

New sales - total

Amount (Rs. Lakhs) 44,348 37,274 19%

Area (Mnsf) 7.41 7.14 4%

Avg Realisation/Sft (Rs) 5,985 5,220 15%

new sales - Prestige share

Amount (Rs. Lakhs) 36,323 31221 16%

Area (Mnsf) 6.14 5.99 3%

Launches (Mnsf) 15.67 10.39 51%

Collections (Rs. Lakhs) 24753 19695 26%

During the year under review, your Company has sustained and also attained higher levels in terms of Revenue, Turnover, Sales and Collections as compared to 2012-13. During the year, eleven residential projects comprising 15.67 mnsf were launched.

Our new sales have been robust at over Rs. Rs. 44,348 millionin FY 13-14, which is above its guidance of Rs. 43,000 Mn. We expect the momentum of this growth to improve further in the coming years. We are looking at achieving Rs. 50,000Mn of new sales in FY 14-15. A brief comparative summary of sales achieved in FY 13-14 is as follows:

Area in Million Sft (Prestige share) Rs.in Lakhs

Particulars FY 13-14 FY 12-13

Area Units Value Area Units Value residential

Mid Income Segment 4.65 3,303 26,068 4.01 2,560 19,675

Premium Segment 1.27 397 9,166 0.89 239 6,471

Sub total - residential 5.92 3,699 35,234 4.9 2,799 26,146

Commercial 0.22 - 1,089 1.09 - 5,075

Total - Prestige share 6.14 3,699 36,323 5.99 2,799 31,221

Avg Realisation per sft 5,912 5,220

During the year, your Company has completed three commercial projects, two hospitality projects and one retail project aggregating to 3.18 million Sft of developable area, the details of which are as follows:

Project Location Segment Developable Economic Prestige Share Area (Mnsf) Interest (Mnsf)

Quarter I

Forum Vijaya Mall Chennai Retail 1.16 50.00% 0.58

Forum Vijaya - Commercial Chennai Commercial 0.55 50.00% 0.28

Cessna Business Park - B7 Bangalore Commercial 0.77 85.00% 0.65

Sub Total QI 2.48 1.51

Quarter II

Quarter III

Forum Value Mall - Service Apts Bangalore Hospitality 0.37 35.00% 0.13

Sub Total QIII 0.37 0.13

Quarter IV

Aloft Bangalore Hospitality 0.29 85.00% 0.25

Prestige Star I Bangalore Commercial 0.04 64.00% 0.03

Sub Total QIV 0.33 0.28

Grand Total 3.18 1.92

3. AUDITOR''S REPORT

The statutory auditors in their report have emphasised that Trade receivables outstanding for more than six months from the date on which they were due include an amount of Rs. 11,073 Lakhs relating to dues from certain parties which have been considered good and recoverable by the Management, inter alia, based on the continuing business relationships and arangements that the Company has with these parties.

In the opinion of the Board of Directos, the amount (Rs. 11,073 Lakhs) has been considered good and recoverable taking into acount the continuing business relationships and arrangements that the Company has with the parties from whom the amount is due.

4. DIVIDEND

Your Board of Directors has recommend a dividend of Rs.1.50 per equity share, (previous year Rs.1.20 per share) for the year ended March 31, 2014 amounting to pay-out of Rs.61.42Mn (inclusive of dividend distribution tax of Rs.8.92Mn) for consideration and approval by the shareholders at the ensuing Annual General Meeting.

The Company proposes to transfer Rs. 170.1Mn to General Reserve out of the amount available for appropriation and an amount of Rs. 2615.9Mn is retained in the Profit and Loss Account.

5. FIXED DEPOSITS

During the year, the Company has not accepted any deposits from the public.

6. SUBSIDIARIES

The Company presently has 22 subsidiary companies all of which are operating from India. During the year 2013-14, Valdel xtent Outsourcing Solutions Private Limited, the subsidiary Company has acquired 100% stake in Avyakth Cold Storages Private Limited, making it a step down subsidiary of the company.

As per the General Circular No. 2/2011 dated February 8, 2011, issued by Ministry of Corporate Affairs, the Balance Sheet, Profit and Loss Account Statement and other such documents of the subsidiaries are not being attached to the Balance Sheet of the Parent Company. However, as per the Circular, the consolidated financials of the Company and its subsidiaries have been inserted as a part of the Annual Report. Further, statement pursuant to Section 212 of the Companies Act, 1956, relating to Subsidiary Companies is attached herewith as Annexure to the Report.

The annual accounts of the subsidiary companies are kept open for inspection by any shareholder in the Registered Office of the Company. The Company shall provide a copy of annual accounts of subsidiaries to the shareholder on demand.

7. ACCOUNTING POLICIES

The financial statements have been prepared under the historical cost convention in accordance with Indian Generally Accepted Accounting Principles (GAAP) on the accrual basis and comply with applicable mandatory Accounting Standard prescribed under the Companies (Accounting Standard) Rules, 2006. The Company has complied with the revised Schedule VI of the Companies Act, 1956.

8. INFORMATION REQUIRED UNDER THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF THE BOARD OF DIRECTORS ) RULES, 1988 CONSERVATION OF ENERGY:

The Company has made energy saving efforts wherever possible. As part of Green Initiative, IGBC-LEED requirements and Energy conservation code, following energy conservation measures have been taken in our various projects:

- Use of solar lighting for landscape

- Use of VFD''s

- Use of CFLs, LED''s in lighting of common areas

- Conform to lighting power density requirements as per Green building norms for basements, driveways and other common areas

- Use of glass on external facade to maximize daylight views with appropriate shading coefficients, solar factor and solar heat gain coefficient

- Use of daylight sensors in office areas

- Use of lighting management system with timers for external lighting

- Use of surface reflective paint for reducing heat island effect and thereby reduce A/C loads

The Company''s initiative of Green Building in one of its projects in subsidiary company, i.e. Cessna Business Park, has been awarded Platinum Certification under uSGB''s LEED ID C rating system. This is the highest rated Platinum LEED ID C projects in Asia and the second highest in the world having been awarded a total of 97 points by the u.S Green Building Council.

The projects Prestige Palladium Bayan and Prestige Polygon at Chennai have achieved precertification under the LEED India for Core & Shell Rating System.

TECHNOLOGY ABSORPTION:

The Company as a part of progressive growth is always on the lookout for new technological innovations that can enhance the product quality, increase process speed, reduces adverse impact on the environment. Some of the measures used are:

- Use of low flow toilet fixtures with sensors, concealed valves, etc

- Use of STP treated water for flushing, landscaping and air-conditioning

- Harvesting rain water in the form of deep well recharging, collection, treatment and use of terrace storm water, etc

- Increased use of water cooled chillers

- Installation of organic waste convertors in large residential projects

- Use of centralised LPG reticulation system with piped gas supply to individual flats

- Use of CCTV, door video phones to enhance security

- Use of modular toilet partitions in lieu of conventional block work, tiling and wooden flush doors

- Use of in situ concrete load bearing walls constructed using aluminum formwork instead of RCC framed structure in-filled with block masonry that would be plastered on both internal and external faces research and development:

The Company has verified and on research has adopted best suitable methods for execution of the projects. Some of such methods are listed here below:

- Adoption of pre-polished cut-to-size engineered stone flooring as against unpolished random slabs that caused large wastages in terms of time and effort put in for cutting, lifting, placing and polishing

- Introduction of laminated wooden flooring for faster and cleaner execution in place of conventional tiled flooring

- Use of soil nailing, shotcreting /guniting for stabilising steep slopes of excavation

- Use of chemical stabilisation techniques by using admixtures of available soil for road sub-base construction

- Introduction of non-destructive testing like Pile Dynamic Analyser test to reduce the dependency on conventional maintained pile load test, use of pile integrity test for assessing soundness of concrete in piled foundation foreign exchange earnings and outgo:

Foreign exchange earned during the year is equivalent to Rs.504 Lakhs (previous year Rs.509 Lakhs) and the expenditure is Rs.3,641 Lakhs (previous year Rs. 2,411 Lakhs).

9. PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, the names and other particulars of the employees are required to be set out in the Annexure to the Directors'' Report. However, having regard to the provisions of Section 219 (1) (b) (iv) of the said Act, the Annual Report excluding the aforementioned information is being sent to all the Members of the Company and others entitled thereto. Any member who is interested in obtaining such particulars may write to the Company, at the Registered Office of the Company.

10. DIRECTORS

As on the date, the Board of Directors of the Company comprises of 7 Directors, of whom 4 are Independent Directors and 3 are executive Directors. During the year under review, there was no change in the Board of Directors. Mr. Irfan Razack, Director would be retiring by rotation at the Annual General Meeting, who, being eligible, offers himself for re-appointment. Mr.Jagdeesh K Reddy, Mr. B.G Koshy, Dr. P Ranganath Nayak and Mr. Noor Ahmed Jaffer are proposed to be appointed as Independent directors of the Company whose period of office is liable to retire by rotation as per the Companies Act, 1956 and who have submitted a declaration that they meet the criteria for independence as provided in Section 149(6) of the Companies Act, 2013 and who are eligible for appointment in respect of whom the company has received a notice in writing under section 160 of the Companies Act, 2013 from a member proposing the candidature for the office of Director , who shall hold office up to September 24, 2019, not liable to retire by rotation. The brief profiles of directors proposed for appointment are annexed along with the notice of Annual General Meeting and the Board recommends their reappointment.

11. DIRECTORS'' RESPONSIBILITY STATEMENT

In pursuance of Section 217 (2AA) of the Companies Act, 1956, the Directors allege, as a part of their responsibility, that:

1. The Company has, in the preparation of the annual accounts, followed the applicable accounting standards along with proper explanations relating to material departures, if any.

2. The Directors have selected such accounting policies, 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 on March 31, 2014and that of the Profit and Loss statement of the Company for the financial year ended March 31, 2014.

3. The Directors have taken proper and sufficient care in maintaining 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.

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

12. AUDITORS

The Company''s auditors, M/s. Deloitte Haskins & Sells, are due to retire at the conclusion of the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. The Board of Directors, propose to reappoint M/s Deloitte Haskins & Sells as Statutory Auditors of the Company from the conclusion of Seventeenth Annual General Meeting until the conclusion of the Twentieth Annual General Meeting.

13. CORPORATE GOVERNANCE

The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges, forms part of this Report. The Certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under the aforementioned Clause 49 is also attached to this Report.

14. MANAGEMENT DISCUSSION & ANALYSIS REPORT

Management Discussion and Analysis Report as required under Clause 49(IV) (F) is attached along with this Report.

15. ACKNOWLEDGEMENTS

The Board of Directors sincerely thank the Company''s valued customers, clients, suppliers, vendors, investors, bankers and shareholders for their trust and support towards the Company. The Board expresses its deepest sense of appreciation to all the employees whose professional committed initiative has laid the foundation for the organization''s growth and success.

For and on behalf of the Board

Sd/- Sd/-

Irfan Razack Rezwan Razack

Chairman & Managing Director Joint Managing Director

Place: Bangalore Date : 26th May, 2014


Mar 31, 2013

Dear Shareholders,

The Directors are pleased to present their Sixteenth Annual Report of the business operations and the financial accounts of the Company for the year ended March 31, 2013.

1. FINANCIAL HIGHLIGHTS

(Rs. In Lakhs) Particulars Standalone Results Consolidated Results March 31, March 31, March 31, March 31, 2013 2012 2013 2012

Net Sales/ Income 160,630 79,923 201,116 108,646

Total expenditure 109,502 50,858 136,849 75,562

Profit before interest, depreciation, exceptional items and taxes 51,128 29,065 64,267 33,084

Less: Interest 8,972 7,651 14,891 11,927

Profit before depreciation, exceptional items and taxes 42,156 21,414 49,376 21,157

Less: Depreciation 3,296 3,245 6,818 6,054

Profit before exceptional items and taxes 38,860 18,169 42,558 15,103

Less: Exceptional items 0 0 0 0

Profit before taxes 38,860 18,169 42,558 15,103

Less: Provision for current taxation 11,353 4,875 13,314 5,913

Less/(Add): Income tax pertaining to earlier years -39 -51 303 -82

Less/(Add): MAT Credit entitlement -384 0

Less/(Add): Deferred taxation -61 438 -89 432

Profit after taxes 27,607 12,907 29,414 8,840

Share of profit from associates (Net) 0 0 -333 -650

Share in (Profit) / loss to minority interest 0 0 -484 70

Adjustment on disinvestment in subsidiary companies 0 0 0 0

Adjustment arising on consolidation 0 0 0 79

Balance available for appropriation 27,607 12,907 28,597 8,339

Transfer to general reserve 690 323 690 323

Proposed dividend 4,200 3,937 4,200 3,937

Dividend distribution tax 714 641 714 641

Balance carried to balance sheet 22,003 8,006 22,993 3,438

(a) The Year 2012-13 - Financial Performance Standalone Financial Performance

- Revenue for FY 12-13 is at Rs. 1,60,630 lakhs, up by 101% as compared to the previous years revenue of Rs. 79,923 lakhs.

- EBIDTA for FY 12-13 is Rs. 51,128 lakhs, up by 76% as compared to the previous years revenue of Rs. 29,065 lakhs.

- PAT for FY 12-13 is Rs. 27,607 lakhs, up by 132% as compared to the previous year s revenue of Rs. 12,907 lakhs.

- Rental Income for FY 12-13 is Rs. 22,285 lakhs, up by 35% as compared to the previous year s rental income of Rs. 16,480 lakhs.

A detailed comparative summary of the standalone financial performance is as under:

Particulars FY 12-13 FY 11-12 Growth %

Turnover (Rs. Lakhs) 1,60,630 79,923 101%

EBIDTA (Rs. Lakhs) 51,128 29,065 76%

PAT (Rs. Lakhs) 27,607 12,907 114%

PAT % 17% 16% 6%

WACC 13.01% 13.63% -5%

Rental Income - Prestige Share (Rs. Lakhs) 22,285 16,480 35%

D/E Ratio (Number of times) 0.37 0.48 -23%

Consolidated Financial Performance

- Consolidated Revenue for FY 12-13 is at Rs. 2,01,116 lakhs, up by 85% as compared to the previous years revenue of Rs. 1,08,646 lakhs.

- Consolidated EBIDTA for FY 12-13 is Rs. 64,267 lakhs, up by 94% as compared to the previous year s revenue of Rs. 33,084 lakhs.

- Consolidated PAT for FY 12-13 is Rs. 29,081 lakhs, up by 255% as compared to the previous year s revenue of Rs. 8,190 lakhs.

A detailed comparative summary of the consolidated financial performance is as under:

Particulars FY 12-13 FY 11-12 Growth %

Consolidated Turnover (Rs. Lakhs) 2,01,116 1,08,646 85%

Consolidated EBIDTA (Rs. Lakhs) 64,267 33,084 94%

Consolidated EBIDTA % 32% 30% 5%

Consolidated PAT (Rs. Lakhs) 29,081 8,190 255%

Consolidated PAT % 14% 8% 92%

I Consolidated D/E Ratio (Number of times) 0.60 0.60

(b) Issue Proceeds from Equity

i) Utilization of Initial Public Offering- IPO Proceeds

The funds of Rs.1,14,768 Lakhs (excluding issue expenses), raised in the Initial Public Offering (IPO) in October 2010 have been fully utilized and there have been no deviations in utilization from the means as approved by the shareholders in the Annual General Meeting dated 28 July 2011.

ii) Institutional Private Placement- IPP

During the year ended March 31, 2013, your Company has successfully completed an Institutional Private Placement under Chapter VIII-A of Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended, which opened on January 23, 2013 and closed on the same date. The total IPP proceeds were Rs. 36,398 Lakhs. Pursuant to this placement, 2,19,26,230 equity shares of Rs. 10 each at a premium of Rs. 156 per share were allotted on January 29, 2013. Issue expenses were Rs.953 Lakhs. The public shareholding in your Company has increased to 25% of its issued and paid up capital pursuant to the IPP

Your Company is thankful to all the investors for the overwhelming response and the confidence reposed on us.

2. REVIEW OF OPERATIONS Operational Highlights

- The Company has sold 3,566 units for the year ended March 31, 2013 totalling to 7.14 million square feet thereby translating to Rs. 3,72,740 lakhs of Sales (PEPL Share: Rs. 3,12,210 lakhs).

- For the year ended March 31, 2013, the average realization achieved is up by 18% at Rs. 5,220 per Sft as compared to the corresponding previous year s average realization of Rs. 4,426 per Sft.

- Completed and delivered 2.31 million square feet of Commercial Office space.

- Registered total new leasing at 2.10 million square feet.

- The total collections for the year ended March 31, 2013 aggregated to Rs. 1,96,950 lakhs as against Rs. 1,33,540 lakhs of the previous year thereby recording a growth of 47%.

A detailed comparative summary of the operational performance is as under:

Particulars FY 12-13 FY 11-12 Growth %

New Sales - Total Amount (Rs. Lakhs) 3,72,740 2,39,000 56%

Area (Mnsf) 7.14 5.40 32%

Avg Realization/Sft (Rs) 5,220 4,426 18%

New Sales - Prestige Share

Amount (Rs. Lakhs) 3,12,210 2,11,270 48%

Area (Mnsf) 5.99 4.91 22%

Launches (Mnsf) 10.39 10.04 4%

I Collections (Rs. Lakhs) 1,96,950 1,33,540 47%

During the year under review, your Company has accomplished the desired success. Revenue, Turnover, Sales and Collections have seen substantial growth as compared to 2011-12. During the fiscal, fifteen residential projects comprising 7.89 mnsf, six commercial projects comprising 2.37 Mnsf and one retail project of 0.12 Mnsf were launched.

The details of launches for the FY 2012-13 are as under:

Sl. No Project Location Segment Area (Mnsf)

Quarter I

1 Prestige Garden Bay Bangalore Residential

2 Prestige Glenwood Bangalore Residential

3 Prestige Silver Crest Bangalore Residential

4 Prestige Mayberry - I Bangalore Residential

5 Prestige Mayberry - II Bangalore Residential

6 Prestige Summer Fields Bangalore Residential

7 Prestige Silver Sun Bangalore Residential

Total - Quarter I

NAME Developable Economic No. of Units Interest (PEPL Share)

Prestige Garden Bay 0.64 72.00% 132

Prestige Garden Bay 0.32 65.00% 75

Prestige Garden Bay 0.25 100.00% 122

Prestige Garden Bay 0.12 45.00% 19

Prestige Garden Bay 0.39 62.00% 78

Prestige Garden Bay 0.26 43.00% 64

Prestige Garden Bay 0.21 43.00% 59

Prestige Garden Bay 2.19 549

Sl. No Project Location Segment Area (Mnsf)

Quarter II

8 Prestige Ferns Residency Bangalore Residential

9 Prestige Misty Waters Bangalore Residential

10 Prestige Tech Vista Bangalore Residential

Prestige West Holme Mangalore Residential

Sub Total - Residential

12 Prestige Tech Platina Bangalore Commercial

13 Prestige Star Bangalore Commercial

14 Prestige TMS Square Cochin Commercial

Sub Total - Commercial

15 Prestige TMS Square Cochin Retail

Sub Total - Retail Total - Quarter II Quarter III

16 Prestige Royale Garden - Phase I Bangalore Residential

17 Prestige Casabella Bangalore Residential

Sub Total - Residential

1 8 Prestige Falcon Tower Bangalore Commercial

19 Prestige Star II Bangalore Commercial

20 Prestige Trinity Centre Bangalore Commercial

Sub Total - Commercial Total - Quarter III Quarter IV

21 Prestige Brooklyn Heights Bangalore Residential

22 Prestige Spencer Heights Bangalore Residential

Sub Total - Residential Total - Quarter IV GRAND TOTAL

PROJECT Developable Economic No. of Units Interest PEPL Share)

Prestige Misty Waters 3.29 62.00% 821

Prestige Misty Waters 1.02 50.00% 282

Prestige Misty Waters 0.12 62.00% 20

Prestige Misty Waters 0.06 65.00% 13

Prestige Misty Waters 4.49 1,136

Prestige Misty Waters 1.43 66.66%

Prestige Misty Waters 0.04 64.00%

Prestige Misty Waters 0.17 50.00%

Prestige Misty Waters 1.64

Prestige Misty Waters 0.12 50.00%

Prestige Misty Waters 0.12

Prestige Misty Waters 6.25 1136

Prestige Misty Waters 0.43 68.50% 175

Prestige Misty Waters 0.48 75.00% 158

Prestige Misty Waters 0.91 333

Prestige Misty Waters 0.49 45.00%

Prestige Misty Waters 0.08 64.00%

Prestige Misty Waters 0.16 43.00%

Prestige Misty Waters 0.73

Prestige Misty Waters 1.64 333

Prestige Misty Waters 0.22 62.00% 94

Prestige Misty Waters 0.08 100.00% 34

Prestige Misty Waters 0.30 128

Prestige Misty Waters 0.30 128

Prestige Misty Waters 10.38 2,146

During the financial year 12-13, your Company has achieved 10.38 Mnsf of launches as against 8 Mnsf of the guidance set. We are looking at launching over 14 million Sft of developments in FY 13-14.

Our new sales have been robust at over Rs. 3,70,000 Lakhs in FY 12-13. The momentum of this growth is all set to improve further in the years to come. We are looking at clocking Rs. 4,30,000 Lakhs of new sales in FY 13-14 of which Prestige share would tentatively be around Rs. 3,70,000 Lakhs. A brief comparative summary of sales achieved in FY 12-13 is as follows:

Area in Million Sft

Rs in Lakhs Particulars FY 12-13 FY 11-12 Area Units Value Area Units Value Residential

Mid Income Segment 4.01 2,560 1,96,750 4.18 2,923 1,60,410

Premium Segment 0.89 239 64,710 0.39 78 32,100

Sub Total - Residential 4.90 2,799 2,61,460 4.57 3,001 1,92,500

Commercial 1.09 50,750 0.34 18,770

Total - Prestige Share 5.99 2,799 3,12,210 4.91 3,001 2,11,270

Total - LO Share 1.13 767 60,530 0.49 326 27,730

Total Sales 7.14 3,566 3,72,740 5.40 3,326 2,39,000

Avg Realisation per sft 5,220 4,426

Your Company has completed three commercial projects during the year aggregating to 2.31 million Sft of developable area, the details of which are as follows:

Project Location Segment Developable Economic Prestige Share Area (Mnsf) Interest (Mnsf)

Quarter III

Prestige Shantiniketan (Tower C) Bangalore Commercial 0.76 61.00% 0.46

Exora Business Park - Block 3 Bangalore Commercial 1.02 32.46% 0.33

Total 1.78 0.79

Quarter IV

Prestige Polygon Chennai Commercial 0.53 100.00% 0.53

Total 0.53 0.53

GRAND TOTAL 2.31 1.33

3. DIVIDEND

Your Board of Directors has recommend a dividend of Rs.1.2 per equity share, (last year also recommended and paid Rs.1.2 per share) for the year ended March 31, 2013 amounting to pay-out of Rs.491.4 Lakhs (inclusive of dividend distribution tax of Rs.71.4 Lakhs) for consideration and approval by the shareholders at the ensuing Annual General Meeting.

The Company proposes to transfer Rs. 690 lakhs to General Reserve out of the amount available for appropriation and an amount of Rs. 22,003 lakhs is retained in the Profit and Loss Account.

4. FIXED DEPOSITS

During the year, the Company has not accepted any deposits from the public.

5. SUBSIDIARIES:

The Company presently has 21 subsidiary companies all of which are operating from India. During the year 2012-13, the Company has increased its stake in the below companies.

Name of the Company Share holding % of stake Current holding in % as at acquired / (disinvested) in % 1 April 2012 during the year

Prestige Garden Resorts Private Limited 50 50 100

Cessna Garden Developers Private Limited 60 25 85

Prestige Constructions Ventures Private Limited 60 40 100

Villaland Developers Private Limited 51 9 60

As per the General Circular No. 2/2011 dated February 8, 2011, issued by Ministry of Corporate Affairs, the Balance Sheet, Profit and Loss Account Statement and other such documents of the subsidiaries are not being attached to the Balance Sheet of the Parent Company. However, as per the Circular, the consolidated financials of the Company and its subsidiaries have been inserted as a part of the Annual Report. Further, statement pursuant to Section 212 of the Companies Act, 1956, relating to Subsidiary Companies is attached herewith as Annexure to the Report.

The annual accounts of the subsidiary companies are kept open for inspection by any shareholder in the Registered Office of the Company. The Company shall provide a copy of annual accounts of subsidiaries to the shareholder on demand.

6. ACCOUNTING POLICIES

The financial statements have been prepared under the historical cost convention in accordance with Indian Generally Accepted Accounting Principles (GAAP) on the accrual basis and comply with applicable mandatory Accounting Standard prescribed under the Companies (Accounting Standard) Rules, 2006. The Company has complied with the revised Schedule VI of the Companies Act, 1956.

7. INFORMATION REQUIRED UNDER THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF THE BOARD OF DIRECTORS) RULES, 1988

Conservation of Energy:

The Company has made energy saving efforts wherever possible. As part of Green Initiative, IGBC-LEED requirements and Energy conservation code, following energy conservation measures have been taken in our various projects:

- Use of solar lighting for landscape

- UseofVFDs

- Use of CFLs, LEDs in lighting of common areas

- Conform to lighting power density requirements as per Green building norms for basements, driveways and other common areas

- Use of glass on external facade to maximize daylight views with appropriate shading coefficients, solar factor and solar heat gain coefficient

- Use of daylight sensors in office areas

- Use of lighting management system with timers for external lighting

- Use of surface reflective paint for reducing heat island effect and thereby reduce A/C loads.

The Company s initiative of Green Building in one of its projects in subsidiary company, i.e. Cessna Business Park has been awarded Platinum Certification under USGBs LEED ID C rating system. This is the highest rated Platinum LEED ID C projects in Asia and the second highest in the world having been awarded a total of 97 points by the U.S Green Building Council.

The projects Prestige Palladium Bayan and Prestige Polygon at Chennai have achieved precertification under the LEED India for Core & Shell Rating System.

Technology Absorption:

The Company as a part of progressive growth is always on the lookout for new technological innovations that can enhance the product quality, increase process speed, reduces adverse impact on the environment. Some of the measures used are:

- Use of low flow toilet fixtures with sensors, concealed valves, etc

- Use of STP treated water for flushing, landscaping and air-conditioning

- Harvesting rain water in the form of deep well recharging, collection, treatment and use of terrace storm water, etc

- Increased use of water cooled chillers

- Installation of organic waste convertors in large residential projects

- Use of centralised LPG reticulation system with piped gas supply to individual flats

- Use of CCTV, door video phones to enhance security

- Use of modular toilet partitions in lieu of conventional block work, tiling and wooden flush doors

- Use of in situ concrete load bearing walls constructed using aluminum formwork instead of RCC framed structure in-filled with block masonry that would be plastered on both internal and external faces

Research and Development:

The Company has verified and on research has adopted the best and most suitable methods for execution of the projects. Some of the methods are listed here below:

- Adoption of pre-polished cut-to-size engineered stone flooring as against unpolished random slabs that caused large wastages in terms of time and effort put in for cutting, lifting, placing and polishing

- Introduction of laminated wooden flooring for faster and cleaner execution in place of conventional tiled flooring

- Use of soil nailing, shotcreting /guniting for stabilising steep slopes of excavation

- Use of chemical stabilisation techniques by using admixtures of available soil for road sub-base construction

- Introduction of non-destructive testing like Pile Dynamic Analyser test to reduce the dependency on conventional maintained pile load test, use of pile integrity test for assessing soundness of concrete in piled foundation

Foreign exchange earnings and outgo:

Foreign exchange earned during the year is equivalent to Rs.509 Lakhs and the expenditure is Rs.2,411 Lakhs.

8. PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 217 (2A) the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, the names and other particulars of the employees are required to be set out in the Annexure to the Directors Report. However, having regard to the provisions of Section 219 (1) (b) (iv) of the said Act, the Annual Report excluding the aforementioned information is being sent to all the Members of the Company and others entitled thereto. Any member who is interested in obtaining such particulars may write to the Company, at the Registered Office of the Company.

9. DIRECTORS

As on the date, the Board of Directors of the Company comprises of 7 Directors, out of which 4 are Independent Directors. During the year under review, there was no change in the Board of Directors. Out of the current Directors of the Company, Mr. Rezwan Razack and Mr. Noaman Razack would be retiring by rotation, who, being eligible, offer themselves for re-appointment. Their brief profiles are annexed along with the notice of Annual General Meeting and the Board recommends their reappointment.

10. DIRECTORS’ RESPONSIBILITY STATEMENT

In pursuance of Section 217 (2AA) of the Companies Act, 1956, the Directors confirm, as a part of their responsibility, that:

1. The Company has, in the preparation of the annual accounts, followed the applicable accounting standards along with proper explanations relating to material departures, if any.

2. The Directors have selected such accounting policies, 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 on March 31, 2013 and that of the Profit and Loss statement of the Company for the financial year ended March 31, 2013.

3. The Directors have taken proper and sufficient care in maintaining 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.

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

11. AUDITORS

The Company s auditors, M/s. Deloitte Haskins & Sells, are due to retire at the conclusion of the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. The Board of Directors, propose to reappoint M/s Deloitte Haskins & Sells as Statutory Auditors of the Company for the financial year 2013-2014.

12. CORPORATE GOVERNANCE

The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges, forms part of this Report. The Certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under the aforementioned Clause 49 is also attached to this Report.

13. MANAGEMENT DISCUSSION & ANALYSIS REPORT

Management Discussion and Analysis Report as required under Clause 49(IV) (F) is attached along with this Report.

14. ACKNOWLEDGEMENTS

The Board of Directors sincerely thank the Company s valued customers, clients, suppliers, vendors, investors, bankers and shareholders for their trust and support towards the Company. The Board expresses its deepest sense of appreciation to all the employees whose professional committed initiative has laid the foundation for the organization s growth and success.

For and on behalf of the Board

Irfan Razack Rezwan Razack

Chairman & Managing Director

Joint Managing Director

Date: May 21, 2013

Place: Bangalore


Mar 31, 2012

The Directors are pleased to present their Fifteenth Annual Report of the business operations and the financial accounts of the Company for the year ended March 31, 2012.

1. FINANCIAL HIGHLIGHTS

(Rs. In Lakhs)

Standalone Results Consolidated Results

Particulars March 31, March 31, March 31, March 31, 2012 2011 2012 2011

Net Sales/ Income 79,923 146,148 108,646 161,134

Total expenditure 50,858 106,121 75,562 116,926

Profit before interest, depreciation, 29,065 40,027 33,084 44,208 exceptional items and taxes

Less: Interest 7,651 7,872 11,927 12,342

Profit before depreciation, 21,414 32,155 21,157 31,866 exceptional items and taxes

Less: Depreciation 3,245 3,323 6,054 6,061

Profit before exceptional items and taxes 18,169 28,832 15,103 25,805

Less: Exceptional items - - - -

Profit before taxes 18,169 28,832 15,103 25,805

Less: Provision for current taxation 4,875 7,580 5,913 8,228

Less/(Add): Income tax pertaining to earlier years (51) 126 (82) 152

Less/(Add): Deferred taxation 438 771 432 759

Profit after taxes 12,907 20,355 8,840 16,666

Share of profit from associates (Net) - - (650) 510

Share in (Profit) / loss to minority interest - - 70 (81)

Adjustment on disinvestment - - - 392 in subsidiary companies

Adjustment arising on consolidation - - 79 (182)

Balance available for appropriation 12,907 20,355 8,339 17,305

Transfer to general reserve 323 509 323 588

Proposed dividend 3937 3937 3,937 3,937

Dividend distribution tax 641 621 641 654

Balance carried to balance sheet 8,006 15,288 3,438 12,126

(a) The Year 2011-12 — Financial Performance

Standalone Results

During the year, your Company has achieved a total income of Rs. 79,923 Lakhs and Profit After Tax (PAT) of Rs. 12,907 Lakhs for the year ended March 31, 2012 against the total income of Rs. 146,148 Lakhs and Profit After Tax of Rs.20,355 Lakhs for the previous financial year ended March 31, 2011. The total income reduced by 45% and PAT by 37%. The EBITDA for the current year stands at Rs. 29,065 Lakhs as compared to Rs.40,027 Lakhs for the previous year. The decline is primarily on account of lower recognition as per accounting guideline.

The expenses reduced from Rs. 117,316 Lakhs to Rs.61,754 Lakhs in the current financial year due to reduction in recognition of revenues from ongoing projects. As a percentage of total income, it is decreased from 80% to 77%.

Consolidated Results

The consolidated income of the Company is Rs. 108,646 Lakhs and PAT is Rs. 8,840 Lakhs for the financial year ended March 31, 2012 as compared to consolidated income of Rs.161,134 Lakhs and PAT of Rs. 16,666 Lakhs for the financial year ended March 31, 2011. The income is reduced by 33% and PAT is reduced by 47%.

(b) Utilisation Of Issue Proceeds

The funds of Rs.114,768 Lakhs (excluding issue expenses), raised in the Initial Public Offering (IPO) in October 2010, have been utilised as per the statement shown below:

(Rs. In Lakhs)

Amount approved by Amount utilised till Expenditure items share holders in the AGM March 31, 2012 held on July 28, 2011

Finance our ongoing projects 39,860 34,223 and projects under development

Investment in our existing subsidiaries for 7,399 7,399 the construction and development of projects

Financing for the acquisition of land 7,728 7,728

Repayment of loans 37,348 37,348

General corporate purposes 22,433 22,433

TOTAL 114,768 109,131

The amounts unutilised are invested/held in:

a) Fixed deposit and Mutual Funds 5,000

b) Balance with banks in current accounts 637

Total 5,637

The Shareholders of the Company in the Fourteenth Annual General Meeting held on July 28, 2011 have given their approval under Section 61 of the Companies Act, 1956 for varying, modifying, revising the purpose of utilisation of IPO proceeds in consideration of business prospects and funding requirements of the Company.

2. REVIEW OF OPERATIONS

During the year under review, the Company has been successful in maintaining the tempo of growth. Two residential projects comprising of 19.37 Lakh square feet and four commercial projects consisting of 9.50 Lakh square feet and one hospitality project of 1.57 Lakh square feet were completed and delivered. The details are as below:

Name of the Project Number of Developable Area in Location Apartments lakh square feet

Residential projects:

Prestige Neptune's Courtyard 374 10.80 Kochi

Prestige Southridge 264 8.57 Bangalore

TOTAL 638 19.37

Commercial projects:

Prestige Dynasty II N.A. 1.44 Bangalore

Prestige Atrium N.A. 1.72 Bangalore

Prestige Palladium N.A. 2.99 Chennai

Cessna Business Park - B5 Block N.A 3.26 Bangalore

TOTAL 9.50

Hospitality projects:

Prestige Golfshire - Clubhouse N.A. 1.57 Bangalore

The Prestige Neptune's Courtyard is a marina condominium development on Marina Drive, Kochi, designed with modern architectural techniques, have unique features like 'Sky Club' on the 13th floor of each of the 7 towers, housing a lounge, party hall and small theatre.

Prestige Southridge is a residential project spread over 9.60 acres of land at South Bangalore, with an exceptional feature of using only 14% of land for construction and the balance area being used for landscaping.

During the year, the Company has launched 7 projects aggregating to 128.89 lakh sft including 4 residential projects, 2 commercial projects and 1 retail project that have received overwhelming response. They are:

Project Location Segment Developable Number of Economic Area in Lakh Sqft Units Interest

Prestige Tranquility Bangalore Residential 45.65 2,368 100.00%

Prestige Park View Bangalore Residential 9.27 376 65.00%

Prestige Sunny Side Bangalore Residential 9.76 395 100.00%

Prestige Bella Vista Chennai Residential 50.43 2,613 60.00%

Prestige Trade Towers Bangalore Commercial 6.13 N.A. 45.00%

Excelsior Bangalore Commercial 2.20 N.A. 32.46%

Forum Mysore Mall Mysore Retail 5.45 N.A. 50.99%

With Prestige Bella Vista, the Company has forayed into the residential market of Chennai. The project has been well received by the people in Chennai. Within three months of launch, around 900 units were sold.

The Company has been pioneer in introducing mall concept in Bangalore. It is now spreading the mall concept to Mysore, a Tier II city with high growth potential in Karnataka.

3. DIVIDEND

Your Board of Directors has recommended a dividend of Rs.1.20 per equity share (last year also recommended and paid Rs.1.20 per equity share) for the year ended March 31, 2012 amounting to pay-out of Rs. 4,578 Lakhs (inclusive of dividend distribution tax of Rs. 641 Lakhs) for consideration and approval by the shareholders at the ensuing Annual General Meeting.

The Company proposes to transfer Rs. 323 Lakhs to General Reserve out of the amount available for appropriation and an amount of Rs. 8,006 Lakhs is retained in the Profit and Loss Account.

4. FIXED DEPOSITS

During the year, the Company has not accepted any deposits from the public.

5. SUBSIDIARIES

The Company presently has 20 subsidiary companies all of which are operating from India. During the year 2011-12, the Company has increased/(diluted) its stake in the below companies: Shareholding % of stake Current in % as at acquired / holding in Name of the Company 1 April 2011 (disinvested) % during the year

Prestige Amusements Private Limited 45.45 5.57 51.02

Valdel Xtent Outsourcing Solutions Private Limited 91.65 8.35 100.00

Westpalm Developments Private Limited 53.50 7.50 61.00

The Company has also subscribed for 25,39,980 Optionally Fully Convertible, Non-cumulative, Redeemable Preference Shares (OFCNRPS) of Rs.10 each of Prestige Leisure Resorts Private Limited at a premium of Rs.72.68 per share.

Further, in one of the associate company, namely Vijaya Productions Private Limited, the Company has increased its stake by 2.30% i.e. from 47.70% to 50% as per the Agreement entered by the Company in 2006.

As per the General Circular No. 2/2011 dated February 8, 2011, issued by Ministry of Corporate Affairs, the Balance Sheet, Profit and Loss Account Statement and other such documents of the subsidiaries are not being attached to the Balance Sheet of the Parent Company. However, as per the Circular, the consolidated financials of the Company and its subsidiaries have been inserted as part of the Annual Report. Further, statement pursuant to Section 212 of the Companies Act, 1956, relating to Subsidiary Companies is attached herewith as Annexure to the Report.

The annual accounts of the subsidiary companies are kept open for inspection by any shareholder in the Registered Office of the Company. The Company shall provide a copy of annual accounts of subsidiaries to the shareholder on demand.

6. ACCOUNTING POLICIES

The financial statements have been prepared under the historical cost convention in accordance with Indian Generally Accepted Accounting Principles (GAAP) on the accrual basis and comply with applicable mandatory Accounting Standard prescribed under the Companies (Accounting Standard) Rules, 2006. During the year ended March 31, 2012, the revised Schedule VI as notified under Companies Act, 1956 has become applicable and the Company has complied with the same.

7. INFORMATION REQUIRED UNDER THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF THE BOARD OF DIRECTORS) RULES, 1988 Conservation of Energy:

The Company has made energy saving efforts wherever possible. As part of Green Initiative, IGBC-LEED requirements and Energy conservation code, following energy conservation measures have been taken in our various projects:

- Use of solar lighting for landscape

- Use of VFD's

- Use of CFL's, LED's in lighting of common areas

- Conform to lighting power density requirements as per Green building norms for basements, driveways and other common areas

- Use of glass on external facade to maximise daylight views with appropriate shading coefficients, solar factor and heat gain solar coefficient

- Use of daylight sensors in office areas

- Use of lighting management system with timers for external lighting

- Use of surface reflective paint for reducing heat island effect and thereby reduce A/C loads.

The Company has adopted the concept of Green Building for one of its project in subsidiary company, i.e. Cessna Business Park. The concept of Green Building embodies the principle of conservation of the natural resource, utilisation of eco- friendly equipments/recycled materials, adoption of effective controls and building management system, efficient utilisation of water and renewable energy, etc.

A most comprehensive certification process named LEED (Leadership in Energy and Environmental Design) has been adopted in India to rate such green buildings. Prestige Group has received LEED Gold Certification for the projects Prestige Palladium Bayan and Exora Business Park. The Group is also in process of attaining LEED Gold rating for projects like Prestige Polygon, Cessna Business Park and also the office space of Prestige Shantiniketan.

Technology Absorption:

The Company as a part of progressive growth is always on the lookout for new technological innovations that can enhance the product quality, increase process speed, reduce adverse impact on the environment. Some of the measures used are:

- Use of low flow toilet fixtures with sensors, concealed valves, etc

- Use of STP treated water for flushing, landscaping and air-conditioning

- Harvesting rain water in the form of deep well recharging, collection, treatment and use of terrace storm water, etc

- Increased use of water cooled chillers

- Installation of organic waste convertors in large residential projects

- Use of centralised LPG reticulation system with piped gas supply to individual flats

- Use of CCTV, door video phones to enhance security

- Use of modular toilet partitions in lieu of conventional block work, tiling and wooden flush doors

- Use of in situ concrete load bearing walls constructed using aluminum formwork instead of RCC framed structure in- filled with block masonry that would be plastered on both internal and external faces

Research and Development:

The Company has verified and on research has adopted best suitable methods for execution of the projects. Some of such methods are listed here below:

- Adoption of pre-polished cut-to-size engineered stone flooring as against unpolished random slabs that caused large wastages in terms of time and effort put in for cutting, lifting, placing and polishing

- Introduction of laminated wooden flooring for faster and cleaner execution in place of conventional tiled flooring in some of the projects

- Use of soil nailing, shotcreting /guniting for stabilising steep slopes of excavation

- Use of chemical stabilisation techniques by using admixtures of available soil for road sub-base construction

- Introduction of non-destructive testing like Pile Dynamic Analyser test to reduce the dependency on conventional maintained pile load test, use of pile integrity test for assessing soundness of concrete in piled foundation

Foreign exchange earnings and outgo:

Foreign exchange earned during the year is equivalent to Rs. 238 Lakhs and the expenditure is equivalent to Rs. 537 Lakhs.

8. PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, the names and other particulars of the employees are required to be set out in the Annexure to the Directors' Report. However, having regard to the provisions of Section 219 (1) (b) (iv) of the said Act, the Annual Report excluding the aforementioned information is being sent to all the Members of the Company and others entitled thereto. Any member who is interested in obtaining such particulars may write to the Company, at the Registered Office of the Company.

9. DIRECTORS

As on date, Board of Directors of the Company comprises of 7 Directors, out of which 4 are Independent Directors. During the year under review, there was no change in the Board of Directors. Out of the current Directors of the Company, Mr. Noor Ahmed Jaffer and Dr. Pangal Ranganath Nayak would be retiring by rotation, who being eligible, offer themselves for re-appointment. Their brief profiles are annexed along with the notice of Annual General Meeting and the Board recommends their reappointment.

10. DIRECTORS' RESPONSIBILITY STATEMENT

In pursuance of Section 217 (2AA) of the Companies Act, 1956, the Directors allege, as apart of their responsibility, that:

1. The Company has, in the preparation of the annual accounts, followed the applicable accounting standards along with proper explanations relating to material departures, if any.

2. The Directors have selected such accounting policies, 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 on March 31, 2012 and that of the Profit and Loss statement of the Company for the financial year ended March 31, 2012.

3. The Directors have taken proper and sufficient care in maintaining 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.

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

11. AUDITORS

The Company's auditors, M/s. Deloitte Haskins & Sells, are due to retire at the conclusion of the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. The Board of Directors, propose to reappoint M/s Deloitte Haskins & Sells as Statutory Auditors of the Company for the financial year 2012-13.

12. CORPORATE GOVERNANCE

The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges, forms part of this Report. The Certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under the aforementioned Clause 49 is also attached to this Report.

13. MANAGEMENT DISCUSSION & ANALYSIS REPORT

Management Discussion and Analysis Report as required under Clause 49(IV) (F) is attached along with this Report.

14. ACKNOWLEDGEMENTS

The Board of Directors sincerely thank the Company's valued customers, clients, suppliers, vendors, investors, bankers and shareholders for their trust and support towards the Company. The Board expresses its deepest sense of appreciation to all the employees whose professional committed initiative has laid the foundation for the organisation's growth and success.

For and on behalf of the Board

Irfan Razack Rezwan Razack

Chairman & Managing Director Joint Managing Director

Date : May 28, 2012

Place : Bangalore


Mar 31, 2011

The Directors are pleased to present their Fourteenth annual report of the business operations and the financial accounts of the Company for the year ended 31 March 2011.

1. FINANCIAL HIGHLIGHTS

Rs in Million

Particulars Standalone Results Consolidated Results 31-Mar-11 31-Mar-10 31-Mar-11 31-Mar-10

Total Income 14,615 9,932 16,113 10,860

Less: Total Expenditure 10,612 7,314 11,693 8,008

Profit before Interest, Depreciation, Exceptional items and Taxes 4,003 2,618 4,420 2,852

Less: Interest 787 661 1,234 783

Profit before Depreciation, Exceptional items and Taxes 3,216 1,957 3,186 2,069

Less: Depreciation 333 350 606 491

Profit before Exceptional items and Taxes 2,883 1,607 2,580 1,578

Less: Preliminary expenses written off - - - 1

Profit before Taxes 2,883 1,607 2,580 1,577

Less: Provision for Current taxation 758 240 823 330

Less/(Add): Income tax pertaining to earlier years 13 (21) 15 (21)

Less/(Add): Deferred taxation 77 (29) 76 (26)

Profit after Taxes 2,035 1,417 1,666 1,294

Share of Profit from Associates (Net) - - 51 172

Share in (Profit)/loss to Minority Interest - - (8) 36

Adjustment on disinvestment in Subsidiary companies - - 39 -

Adjustment arising on consolidation - - (18) (28)

Balance available for Appropriation 2,035 1,417 1,730 1,474

Transfer to General Reserve 51 - 59 -

Proposed Dividend 394 - 394 -

Dividend Distribution tax 62 - 65 -

Balance carried to balance sheet 1,528 1,417 1,212 1,474

(a) Initial Public Offering

During the year, the Company has completed its Initial Public Offering of 6,55,73,770 Equity Shares of Rs 10/- each at a premium of Rs 173/- per Equity Share aggregating to Rs 183/- per Equity Share. The total issue si2e was Rs 12,000 million. The Initial Public Offer was subscribed by 2.26 times. The Companys shares got listed on the National Stock Exchange of India Limited and Bombay Stock Exchange Limited on 27 October 2010.

(b) The Year 2010-11 - Financial Performance

Standalone Results

During the year, your Company has achieved a total income of Rs 14,615 million and Profit after tax (PAT) of Rs 2,035 million for the year ended 31 March 2011 against the total income of Rs 9,932 million and Profit after tax of Rs 1,417 million for the previous financial year ended 31 March 2010. The total income increased by 47% and PAT by 44%. The EBITDA for the current year stands at Rs 4,003 million as compared to Rs 2,618 million for the previous year.

The expenses increased from Rs 7,314 million to Rs 10,612 million in the current financial year due to increase in developmental activities. As a percentage of sales, it is decreased from 74% to 73%.

Consolidated Results

The consolidated income of the Company is Rs 16,113 million and PAT is Rs 1,666 million for the financial year ended 31 March 2011 as compared to consolidated income of Rs 10,860 million and PAT of Rs 1,294 million for the financial year ended 31 March 2010. The income is increased by 48% and PAT is increased by 29% as well as the EBITDA which has also increased by 55% compared to the previous financial year.

(c) Utilization of Issue Proceeds

Out of the total IPO proceeds of Rs 11,476 million (excluding issue expenses), an amount of Rs 8,714 million is utilized as shown below:

(Rs in million)

Expenditure Items Amount to be utilized Amount utilized till

as per Prospectus 31-Mar-2011

Finance our ongoing projects and projects under development 4,288 1,821

Investment in our existing subsidiaries for the construction and development 1,931 442 of projects

Financing for the acquisition of Land 213 768

Repayment of loans 2,800 3,438

General Corporate Purposes 2,243 2,243

TOTAL 11,476 8,714

The amounts unutilized are invested/held in:

a) Fixed deposit and Mutual Funds 2,300

b) Balance with banks in current accounts 462

Total 2,762

The unutilized funds as at 31 March 2011 have been temporarily invested in fixed deposits with the scheduled banks, investments in mutual funds and in current account balance with scheduled banks.

The actual utilization of IPO proceeds has exceeded the amounts mentioned in the offer document in respect of repayment of certain loans aggregating to Rs 638 million. This has been done in order to accelerate the repayment of loans instead of parking the funds in low interest yielding liquid funds, which would result in saving the cost of borrowing. Rs 763 million and Rs 1,344 million have been utilized for acquisition of land and ongoing projects other than those mentioned in the offer document respectively.

The Company has striked beneficial deals in acquiring new land parcels and the earmarked projects are on the slow phase. Hence, to ensure optimum utilization of funds in the best interest of the Company and as a part of good corporate governance, the Board has proposed to seek the approval and/or ratification of the members for utilisation of the IPO proceeds in any new area, avenue, expenditure, head or in any or all the utilisation purposes stated in the Prospectus dated 19 October 2010. As recommended by the Audit Committee, the Board of Directors has approved/retified the changes in utilisation of IPO proceeds. Further as aforementioned, the Board has placed the proposal before the members under agenda Item No. 8 in the notice calling Annual General Meeting attached herewith.

2. REVIEW OF OPERATIONS

Business Operations: The Company is an integrated Real Estate Developer with its major interest in South India. The Companys operations include identification and acquisition of land, development, marketing, selling and leasing property to generate income.

During the financial year, the Group has completed and delivered 14 projects aggregating to 16.6 msf which includes 6 residential projects consisting of 9.8 msf and 8 commercial projects consisting of 6.8 msf.

3. DIVIDEND

The Board of Directors is pleased to recommend a dividend of 12% on the paid-up equity share capital of the Company, which works out to Rs 1.20 per equity share, for consideration and approval by the shareholders at the Annual General Meeting. The total payout amounts to Rs 456 million including dividend distribution tax of Rs 62 million.

The Company proposes to transfer Rs 51 million to General Reserve out of the amount available for appropriation and an amount of Rs 1,528 million is retained in the Profit and Loss Account.

4. FIXED DEPOSITS

During the year, the Company has not accepted any deposits from the public.

5. SUBSIDIARIES:

The Company presently has 19 subsidiary companies all of which are operating from India. During the year 2010-11, the Company has increased/(diluted) its stake in the below Companies:

Name of the Company Shareholding %of Stake acquired/ Current in % as at (disinvested) holding 01-Apr-2010 during the year in%

Cessna Garden Developers Private Limited 35.00 25.00 60.00

Prestige Bidadi Holdings Private Limited 59.94 40.00 99.94

Valdel Xtent Outsourcing Solutions Private Limited 60.00 31.65 91.65

Exora Business Parks Private Limited 55.00 (22.54) 32.46

Villaland Developers Private Limited Nil 51.00 51.00

The Company has noted that its subsidiaries, Cessna Garden Developers Private Limited, Prestige Leisure Resorts Private Limited and Team United Engineers (India) Private Limited need financial support. The subsidiaries have adopted turnaround strategy by which their management believes to generate profits in future. But till such time, the subsidiaries need the support. The Company has fixed a maximum cap for financial support which can be extended to its group companies by way of ICDs, investment or guarantees or security for the loans availed by them.

As per the General Circular No. 2/2011 dated 8 February 2011, issued by Ministry of Corporate Affairs, the Parent Company is exempted from attaching a Balance Sheet, Profit and Loss Account Statement and other such documents of the subsidiaries to the Balance Sheet of the Parent Company. However, the Consolidated financials of the Company and its subsidiaries are prepared in accordance with Accounting Standards AS-21, AS-23 and AS-27 under the relevant provisions of Companies Act, 1956 and have been inserted as part of the Annual Report. Further, statement pursuant to Section 212 of the Companies Act, 1956, relating to Subsidiary Companies in attached herewith as Annexure to the Report.

The annual accounts of the subsidiary companies are kept open for inspection by any shareholder in the Registered Office of the Company. The Company shall provide a copy of annual accounts of subsidiaries to the shareholder on demand.

6. ACCOUNTING POLICIES

The financial statements have been prepared under the historical cost convention in accordance with Indian Generally Accepted Accounting Principles (GAAP) on the accrual basis and comply with applicable mandatory Accounting Standard prescribed under the Companies (Accounting Standard) Rules, 2006. The accounting policies have been consistently applied. All the amounts are stated in Indian Rupees, except as otherwise specified.

7. INFORMATION REQUIRED UNDER THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF THE BOARD OF DIRECTORS) RULES, 1988

Conservation of Energy : The Company has made energy saving efforts wherever possible.

Technology Absorption : Not Applicable

Research and Development: Not Applicable

Foreign exchange earnings and outgo: Foreign exchange earned during the year is equivalent to Rs 28 million and the expenditure is equivalent to Rs 187 million.

8. PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, the names and other particulars of the employees are required to be set out in the Annexure to the Directors Report. However, having regard to the provisions of Section 219 (1) (b) (iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all the Members of the Company and others entitled thereto. Any member who is interested in obtaining such particulars may write to the Company, at the Registered Office of the Company.

9. DIRECTORS

During the year under review, the Board has co-opted Mr. Noaman Razack as an Additional Director. Further, Mr. Noaman Razack is being recommended to be appointed as an Executive, Whole-time Director on the Board with the approval of members in the ensuing Annual General Meeting. The brief profile of Mr. Noaman Razack is annexed along with the notice of Annual General Meeting. Out of the current Directors of the Company, Mr. Jagdeesh K. Reddy and Mr. BG. Koshy would be retiring by rotation, who, being eligible, offer themselves for re-appointment. Their brief profiles are also annexed along with the notice of Annual General Meeting and the Board recommends their re-appointment.

10. DIRECTORS RESPONSIBILITY STATEMENT

In pursuance of Section 217 (2AA) of the Companies Act, 1956, the Directors allege, as apart of their responsibility, that:

1. The Company has, in the preparation of the annual accounts, followed the applicable accounting standards along with proper explanations relating to material departures, if any.

2. The Directors have selected such accounting policies, 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 as on 31 March 2011 and that of the Profit and Loss statement of the Company for the financial year ended 31 March 2011.

3. The Directors have taken proper and sufficient care in maintaining 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.

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

11. AUDITORS

The Companys auditors, M/s. Deloitte Haskins & Sells, are due to retire at the conclusion of the ensuing Annual General Meeting and have expressed their ability and interest for re-appointment as Statutory Auditors. The Board of Directors, propose to re-appoint M/s. Deloitte Haskins & Sells as Statutory Auditors of the Company for the financial year 2011-12.

12. CORPORATE GOVERNANCE

In accordance with Clause 49 of the Listing Agreement with the Stock Exchanges, a separate report on Corporate Governance along with the Auditors Certificate is annexed along with this Report.

13. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report as required under Clause 49(TV)(F) is attached along with this Report.

14. ACKNOWLEDGEMENTS

The Board of Directors sincerely thank the Companys valued customers, clients, suppliers, vendors, investors, bankers and shareholders for their trust and support towards the Company. The Board expresses its deepest sense of appreciation to all the employees whose professional committed initiative has laid the foundation for the organisations growth and success.

For and on behalf of the Board

Irfan Razack Rezwan Razack

Chairman & Managing Director Joint Managing Director

Date: 17 May 2011

Place: Bengaluru