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Directors Report of PVR Ltd.

Mar 31, 2016

Dear Shareholders,

The Directors have pleasure in presenting the 21st Annual Report on the business and operations of the Company and Audited Financial Statements for the year ended March 31, 2016.

1. FINANCIAL HIGHLIGHTS

Rs. in Crores

Financial Years

Particulars 2015-16 201-15

Income from Operations 1,739.63 1,383.98

Other Income 26.15 5.23

Total 1,765.78 1,389.21

Less: Total Expenditure 1,434.75 1,199.72

Earnings before interest, tax and depreciation amortization (EBITDA) 331.03 189.49

Less :Finance Cost 83.28 76.33

Depreciation & Amortization Expenses 108.58 99.54

Profit before Tax 139.17 13.62

Total Tax expenses/ (Credit) 25.03 -

Net Profit after Tax 114.14 13.62

Earnings per equity share

Basic 25.34 3.30

Diluted 25.32 3.30

Balance as per last financial statement 185.43 192.68

Profit available for appropriation 299.57 206.30

Appropriations

Proposed Dividend on Equity Shares 9.34 4.15

Tax on proposed Equity Dividend 1.90 0.85

Transfer to Debenture Redemption Reserve 16.71 6.47

Depreciation Adjustment - 9.36

Dividend Tax for Previous year 0.61 0.04

Net Surplus in the Statement of Profit and Loss 271.01 185.43

2. DIVIDEND

Your Directors have recommended a Final dividend of Rs. 2/- (Rupees Two) per Equity Share for the financial year ended March 31, 2016 for your approval. The Dividend outgo will amount to Rs. 9.34 Crores (exclusive of Dividend Distribution Tax of Rs. 1.90 Crores approximately).

3. TRANSFER TO RESERVE:

The Company has transferred Rs. 16.71 Crores to the Debenture Redemption Reserve.

4. FINANCIAL REVIEW:

During the year under review Your Company entertained 69.6 million patrons in its cinemas, up by 18% as compared to the previous year, owing to stellar box office performance in all the content streams i.e. Bollywood, Hollywood and Regional Content. Net Box office revenues during the Financial Year 2015-16 has grown by 23%, Food and beverage showed a strong growth of 34% over Financial Year 2015-16 on account of success of the various strategic initiatives taken by the company. Sponsorship Income showed a robust growth of 22% over same period last year. During the year, the company has opened 8 new properties with 52 screens and currently operates a network of 551 screens spread over 121 properties in 47 cities across the country. The company continues its aggressive expansion plan and intends to add approx 65-70 screens during the Financial Year 2016-17. During the Financial year ended March 31, 2016, the total income has increased from Rs. 1,389.21 Crores during the preceding financial year to Rs. 1,765.78 Crores in the year under review registering a growth of 27%.

On 31st May, 2016, Your Company has acquired cinema exhibition business of DLF Utilities Limited, which is operated under the brand name of "DT Cinemas", on a slump sale basis for an aggregate consideration of approximately Rs. 433 Crores (Rupees Four hundred and thirty three Crores). The acquired DT Cinemas (DT) currently operates 29 screens with approximately 7,000 seats across 7 properties in the National Capital Region and Chandigarh. In the current financial year, it is proposed to add 3 new screens in the National Capital Region under DT Cinemas.

Kindly refer to Management Discussion & Analysis and Corporate Governance Reports which forms part of this report for a detailed operation and business performance.

5. FUTURE OUTLOOK

On the back of strong financial year FY 2015-16, we expect the momentum in consumer sentiment to continue in Financial Year 2016-17. In the first quarter of FY 2016- 17 Box office revenues have been very strong, with movies like Jungle Book, Fan, House Full 3, and Sairat. Driven by strong box office performance during the first quarter in Financial Year 2016-17, your Board expect the momentum to continue in the forthcoming quarters on the back of strong content by movie pipeline. The content pipeline looks pretty promising and we expect another blockbuster Financial Year 2016-17. The acquisition of DT Cinemas has completed on 31st May, 201 6 and we expect to achieve synergy on the acquisition in the next 6-12 months. Our growing circuit of high quality cinemas and our companywide emphasis on customer service excellence remain critical factors in our ability to generate positive operating results over the long-term. We have maintained the position as the leading multiplex player in India and soon will pass the 600 screens mark in next few months.

6. REPORT ON THE PERFORMANCE & FINANCIAL POSITION OF SUBSIDIARIES

As on March 31, 2016 the Company had three Subsidiary companies namely PVR Pictures Limited, PVR Leisure Limited and Zea Maize Private Limited. PVR Leisure Ltd. has two subsidiary companies namely PVR Bluo Entertainment Limited and Lettuce Entertain You Limited.

Pursuant to Section 129(3) of the Companies Act, 2013 and Accounting Standard 21 issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company include the Financial Statements of its subsidiary companies.

Pursuant to Section 134 of the Companies Act, 2013 and Rule 8(1) of the Companies (Accounts) Rules, 2014 report on performance and financial position of subsidiaries is attached as per Annexure ''1'' which forms part of this report.

In terms of provisions under Section 136 of the Companies Act, 2013, audited accounts of the subsidiary companies are placed on its website at www.pvrcinemas.com

The Company will make available physical copies of these documents upon request by any shareholder of the Company. These documents shall also be available for inspection at the registered office of the Company during business hours up to the date of Annual General Meeting.

7. CORPORATE GOVERNANCE

The Company is committed to uphold the highest standards of corporate governance and believes that the business relationship can be strengthened through corporate fairness, transparency and accountability. Your Company complies with all the mandatory provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

A report on Corporate Governance with a certificate from a practicing Company Secretary is enclosed and forms part of the Annual Report. A certificate from Chairman cum Managing Director and Chief Financial Officer of the Company, confirming the correctness of the financial statements, compliance with Company''s Code of Conduct and adequacy of the internal control measures as enumerated and reporting of matters to the Audit Committee in terms of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is enclosed and forms part of this report.

8. DIRECTORS

Pursuant to Section 149 read with Section 152 and other applicable provisions, if any, of the Companies Act, 2013, one-third of such of the Directors as are liable to retire by rotation, shall retire every year and, if eligible, offer themselves for re-appointment at every Annual General Meeting. Consequently, Mr. Sanjeev Kumar will retire by rotation at the ensuing Annual General Meeting and being eligible offer himself for re-appointment in accordance with the provisions of the Companies Act, 2013.

Your Directors recommend, his appointment at the ensuing Annual General Meeting.

Pursuant to Section 167(1)(b) of Companies Act, 2013, Mr. Vicha Poolvaraluk ceased to be the Director of the Company as he could not attend any meeting of the Board during the preceding twelve months.

Mr. Ravinder Singh Thakran and Mr. Narayan Ramachandran resigned from the Company w.e.f. July 24, 2015.

Pursuant to the provisions under Section 134(3)(d) of the Companies Act, 2013, with respect to statement on declaration given by Independent Directors under Section 149(6) of the Act, the Board hereby confirms that all the Independent Directors of the Company have given a declaration and have confirmed that they meet the criteria of Independence as provided in the said Section 149(6).

Ministry of Corporate Affairs has permitted waiver of recovery of excess remuneration of Rs. 2,35,63,972/- (Rupees Two Crore, Thirty-Five Lacs, Sixty Three Thousand, Nine Hundred and Seventy Two only) against total remuneration of Rs. 3,24,90,000/- paid to Mr. Ajay Bijli, Managing Director of the Company during the period from 01.04.2014 to 31.03.2015 vide letter dated 01.07.2016

Ministry of Corporate Affairs has also permitted waiver of recovery of excess remuneration of Rs. 1,35,73,972/- (Rupees One Crore, Thirty-Five Lacs, Seventy Three Thousand, Nine Hundred and Seventy Two only) against total remuneration of Rs. 2,25,00,000/- paid to Mr. Sanjeev Kumar, Joint Managing Director of the Company during the period from 01.04.2014 to 31.03.2015 vide letter dated 01.07.2016

9. KEY MANAGERIAL PERSONNEL

The Key Managerial Personnel (KMP) in the Company as per Section 2(51) and 203 of the Companies Act, 2013 are as follows:

- Mr. Ajay Bijli - Chairman cum Managing Director

- Mr. Naresh - Company Secretary Chandra Gupta

- Mr. Nitin Sood - Chief Financial Officer

During the year, there was no change (appointment or cessation) in the office of any KMP

10. POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION POLICY

Pursuant to the requirements under Section 134(3)(e) and Section 1 78(3) of the Companies Act, 201 3, the policy on appointment of Board Members including criteria for determining qualifications, positive attributes, independence of a director and the policy on remuneration of directors, KMP and other employees is attached as Annexure ''2'' respectively, which forms part of this report.

11. PARTICULARS OF REMUNERATION OF DIRECTORS/ KMP/ EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 1 97(1 2) of the Act read with revised Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 201 4 is attached as Annexure ''3'' which forms part of this report.

In terms of Section 136 of the Act, the report and accounts are being sent to the Members and others entitled thereto, excluding the information on employees particulars which is available for inspection by the members at the registered office of the Company during business hours on working days of the Company up to the date of ensuing Annual general Meeting. Any member interested in obtaining such particulars may write to the Company Secretary at the registered office of the Company and the same will be furnished on request.

12. EMPLOYEES STOCK OPTION PLAN

During the year 1,41,550 Equity Shares under PVR Employees Stock Option Scheme 2012, and 16,500 Equity Shares under PVR Employees Stock Option Scheme 2013 were allotted to the permanent employee(s) of the Company against same numbers of options exercised by them.

13. MEETINGS OF THE BOARD OF DIRECTORS

During the Financial Year 2015-16, seven Board Meetings were held. The details of Board Meetings and Committee Meetings held are given in the Corporate Governance Report.

14. PERFORMANCE EVALUATION OF THE BOARD, ITS COMMITTEES AND DIRECTORS

Pursuant to applicable provisions of the Companies Act, 2013 and the Listing Agreement with Stock Exchanges, the Board, in consultation with its Nomination & Remuneration Committee, has formulated a framework containing, inter- alia, the criteria for performance evaluation of the entire Board of the Company, its Committees and Individual Directors, including Independent Directors.

In order to evaluate the performance and various aspects of the functioning of the Board and its Committees such as adequacy of the Constitution and Composition of the Board and its Committees, are assessed, matters addressed in the Board and Committee Meetings, processes followed at the meetings, Board''s focus, regulatory compliances and Corporate Governance, etc are reviewed. Similarly, for evaluation of Directors'' performance, his/her profile, contribution in Board and Committee Meetings, execution and performance of specific duties, obligations, regulatory compliances and governance are evaluated.

During the financial year under review the Independent Directors had met separately without the presence of Non- Independent Directors and the members of management and discussed, inter-alia, the performance of Non-Independent Directors and Board as a whole and the performance of the Chairman of the Company after taking into account the views of Executive and Non-Executive Directors.

The performance evaluation of all the Independent Directors have been done by the entire Board, excluding the Director being evaluated.

The Directors expressed their satisfaction with the evaluation process.

In compliance with the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the performance evaluation of the Board was carried out during the year under review, details of which are given in Corporate Governance Report.

15. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to requirements of Section 134(3)(c) of the Companies Act, 201 3 with respect to Directors'' Responsibility Statement, the Directors confirm:

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

b. That such accounting policies have been selected by them 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 as at March 31, 2016 and of the profit and loss of the Company for the year ended on that date;

c. That proper and sufficient care has been taken by them for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. That the annual accounts have been prepared by them on a going concern basis;

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

f. That they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

16. STATUTORY AUDITORS AND THEIR REPORT

The re-appointment of company''s Statutory Auditors, M/s. S. R. Batliboi & Co., LLP, Chartered Accountants having firm''s Registration No.: 301003E, is subject to ratification by the members of the Company in the ensuing Annual General Meeting of the Company and the Statutory Auditors being eligible for re-appointment have confirmed their eligibility and consented under Section 1 41 of the Companies Act, 2013 and the Rules framed there under as for their re-appointment Statutory Auditors of the Company for the Financial Year 2016-17.

As required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

There are no observations (including any qualification, reservation, adverse remark or disclaimer) of the Auditors in their Audit Report that may call for any explanation from the Directors. Further, the notes to accounts referred to in the Auditor''s Report are self-explanatory.

17. SECRETARIAL AUDITORS AND THEIR REPORT

The Company has appointed M/s Arun Gupta & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit. The Report of the Secretarial Audit Report in MR-3 is annexed as Annexure ''4''.

There are no qualifications or observations or other adverse remarks of the Secretarial Auditors in the Report issued by them for the financial year 2015-16 which call for any explanation from the Board of Directors.

18. CONSOLIDATED FINANCIAL STATEMENTS

In compliance with the applicable provisions of Companies Act, 2013 including the Accounting Standard 21 on Consolidated Financial Statements, this Annual Report also includes Consolidated Financial Statements for the Financial Year 2015-16.

During the period under review, Consolidated Turnover grew by 27.66% to Rs. 1,89,709 Lacs as compared to Rs. 1,48,598 Lacs in the previous year. Net Profit after Tax for the year is Rs. 11,873 Lacs as compared to Rs. 1,276 Lacs in the Previous Year.

The audited consolidated financial statements together with Auditors'' Report forms part of the Annual Report.

19. INTERNAL FINANCIAL CONTROL SYSTEM

According to Section 134(5)(e) of the Companies Act, 2013 the term Internal Financial Control (IFC) means the policies and procedure adopted by the company for ensuring the orderly and efficient Conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

The Company has a well placed, proper and adequate Internal Financial Control System in place which ensures that all assets are safeguarded and protected and that the transactions are authorised, recorded and reported correctly. The Company''s Internal Financial Control System also comprises due compliances with Company''s policies and Standard Operating Procedures (SOPs) audit and compliance by Company''s Internal Auditor M/s KPMG. The Internal Auditors independently evaluate the adequacy of internal controls and concurrently audit the majority of the transactions. Independence of the audit and compliance is ensured by direct reporting by Internal Auditors to the Audit Committee of the Board.

20. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Companies Act, 2013 requires an effective Internal Financial Control System in the Company. The system should be designed and operated effectively. Rule 8(5) (viii) of Companies (Accounts) Rules, 2014 requires the information regarding adequacy of Internal Financial Controls with reference to the financial statements to be disclosed in the Board''s report.

To ensure effective Internal Financial Controls the Company has laid down the following measures:

- All operations are executed as per prescribed procedures and is updated and validated periodically.

- All legal and statutory compliances are ensured on a monthly basis. Non-compliance, if any, is seriously taken by the management and corrective actions are taken immediately.

- The Company follows a robust 2-tier internal audit process:

- Tier-1 : Cinema audits are conducted on a regular basis throughout the year.

- Tier-2: Transaction audits are conducted regularly, to ensure accuracy of financial reporting, safeguard and protection of all the assets.

- The audit reports for the above audits are compiled and submitted to Audit Committee for deliberations, review and necessary action.

- The Company uses Microsoft Navision Software for maintaining books of accounts and transactions are executed through prescribed procedures to ensure correctness/effectiveness of all transactions, integrity and reliability of reporting.

- The Company has a comprehensive risk management framework.

- The Company has a robust mechanism of building budgets at an integrated cross-functional level. The budgets are reviewed on a periodically basis so as to analyze the performance and take corrective action, wherever required.

- The Company has in place a well-defined Whistle Blower Policy/Vigil Mechanism.

- The Company has a system of Internal Business Reviews. All departmental heads discuss their business issues and future plans in monthly Review Meetings. They review their achievements in the Review Meetings.

- Compliance of secretarial functions is ensured by way of secretarial audit and audit by the Internal Auditors - M/s KPMG.

21. DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT

Pursuant to section 134(3)(n) of the Companies Act, 2013, the company has constituted a business risk management committee. The details of the committee and its terms of reference are set out in the Corporate Governance Report forming part of the Boards Report. At present the company has not identified any element of risk which may threaten the existence of the company.

22. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO

Pursuant to provisions of Section 134 of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 the details of Conservation of Energy, Technology Absorption, Foreign Exchange Earning and Outgo are attached as Annexure ''5'' which forms part of this report.

23. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED ON CORPORATE SOCIAL RESPONSIBILITIES (CSR) INITIATIVES

The Company has in place a CSR Policy in line with Schedule VII of the Companies Act, 2013. As per the policy, the CSR activities are carried by PVR Nest which focuses inter-alia on:

a) Education and social development of the most vulnerable sections of our society

b) Hunger, Poverty, Malnutrition and Health.

c) Sanitation and Safety

d) Gender Equality

e) Environmental Sustainability

The annual report on CSR activities is furnished in Annexure ''6A & 6B'' which forms part of this report. Apart from this the Company also releases a detailed Business Responsibility Report and be available on its website www.pvrcinemas.com

24. CHANGE IN CAPITAL STRUCTURE AND LISTING OF SHARES

The Company''s shares are listed on the National Stock Exchange of India Limited (NSE) and BSE Ltd (BSE).

During the year under review following shares were allotted and admitted for trading on NSE and BSE.

The Company allotted 1,41,550 Equity Shares under PVR Employees Stock Option Scheme 2012 and 16,500 Equity Shares under PVR Employees Stock Option Scheme 2013, to the permanent employee(s) of the Company against same numbers of options exercised by them.

The paid up equity share capital as on March 31, 2016 was Rs. 46,68,69,380. During the year under review, the Company issued 1,58,050 ESOS of Rs.10/- per equity shares. The company has not issued shares with differential voting rights nor granted stock options nor sweat equity. Further 50,00,000 Equity Shares were allotted on July 22, 2015 to three funds at a price of Rs. 700/- each share inclusive of share premium of Rs. 690/- each share.

After the close of the Financial Year, 34,650 Equity Shares were allotted under PVR Employees Stock Option Scheme 2012.

25. EXTRACT OF ANNUAL RETURN

Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the extract of Annual Return as on March 31, 2016 in the prescribed Form No. MGT-9 is attached as Annexure ''7'' and forms part of this report.

26. PARTICULARS OF LOANS, GUARANTEE OR INVESTMENT UNDER SECTION 186 OF THE COMPANIES

Pursuant to Section 134(3)(g) of the Companies Act, 2013 (Act) a statement containing of loans, guarantee or investment under Section 186 of the Act as at end of the Financial Year 2015-16 is attached as Annexure ''8'' which forms part of this report.

27. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES UNDER SECTION 188(1) OF THE COMPANIES ACT, 2013

With reference to Section 134(3)(h) of the Companies Act, 2013 (Act), all contracts and arrangements with related parties under Section 188(1) of the Act, entered by the Company during the financial year, were either in the ordinary course of business or on an arm''s length basis.

During the year, the Company has not entered into any contract or arrangement with related parties which could be considered ''material'' according to the policy of the Company on Materiality of Related Party Transactions.

Your attention is drawn to the Related Party Disclosures set out in the Standalone Financial Statements.

28. DISCLOSURE ON AUDIT COMMITTEE

The Audit Committee as on March 31, 2016 comprises of the following independent directors.

Mr. Sanjai Vohra (Chairman), Mr. Amit Burman, Mr. Vikram Bakshi, Mr. Sanjay Kapoor and Mr. Sanjay Khanna as members.

Further, all recommendations of Audit Committee were accepted by the Board of Directors.

29. DISCLOSURE ON VIGIL MECHANISM

The Company has a vigil mechanism through Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. In staying true to our values of Strength, Performance and Passion and in line with our vision of being one of the most respected companies in India, the Company is committed to the high standards of Corporate Governance and stakeholder responsibility. The Company has Whistle Blower Investigation Committee which provide for adequate safeguards against victimization of persons and also provide for direct access to the Chairman of the Audit Committee and also to the members of the Committee.

The policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern.

The company has always provided a congenial atmosphere for work to all employees, free from discrimination and harassment including sexual harassment. It has provided equal opportunities of employment to all without regard to their caste, religion, colour, marital status and sex. The Company has also framed a policy on "Prevention of Sexual Harassment" at the workplace.

There were two cases reported during the year under review under the said Policy and necessary action was taken by the committee in due course of time. The enthusiasm and unstinting efforts of employees have immensely supported the Company to maintain its leadership position in its industry. Your Company has under taken various steps to further improve its overall performance.

30. DISCLOSURE ON DEPOSIT UNDER CHAPTER V

The Company has neither accepted nor renewed any deposits during the Financial Year 2015-16 in terms of Chapter V of the Companies Act, 2013.

31. CODE OF CONDUCT

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the company. The Company believes in "Zero Tolerance" against bribery, corruption and unethical dealings / behaviours of any form and the Board has laid down the directives to counter such acts. The code laid down by the Board is known as "code of business conduct" which forms an Appendix to the Code. The Code has been posted on the Company''s website. The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. All the Board Members and the Senior Management personnel have confirmed compliance with the Code. All Management Staff were given appropriate training in this regard.

32. MERGER

The merger of PVR Leisure Limited and Lettuce Entertain You Limited with PVR Limited is pending for the approval by the Hon''ble High Court. Further the merger of the Bijli Holdings Private Limited with PVR is pending before the Hon''ble Delhi High Court and the matter has been fixed for hearing on August 4, 2016.

33. PREVENTION OF SEXUAL HARASSMENT POLICY

The Company is committed to provide a protective environment at work place for all its women employees to ensure that every woman employee is treated with dignity and respect and as mandated under "The Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013". The Company has in place a formal policy for prevention of sexual harassment of its women employees. The total number of complaints filed during the FY 2015-16 were 6 and total number of complaints disposed were 6 and the total numbers of complaints pending during at the end of the FY 2015-16 is Nil.

34. ACKNOWLEDGEMENTS

Your Directors thank the various Central and State Government Departments, Organizations and Agencies for the continued help and co-operation extended by them. The Directors also gratefully acknowledge all stakeholders of the Company viz. customers, members, dealers, vendors, banks and other business partners for the excellent support received from them during the year. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.

For and On behalf of the Board For PVR Limited

Place: Gurgaon Ajay Bijli

Date: July 29, 2016 Chairman cum Managing Director


Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting the 20th Annual Report on the business and operations of the Company and Audited Financial Statements for the year ended March 31, 2015.

1. Financial Highlights (Rs. in Crores)

Particulars Financial Years

2014-15 2013-14

Income from Operations 1,383.98 1,271.19

Other Income 5.23 5.72

Total 1,389.21 1,276.91

Less: Total Expenditure 1,199.72 1,062.47

Earnings before interest, tax and 189.49 214.44 depreciation amortization (EBITDA)

Less :Finance Cost 76.33 76.88

Depreciation & Amortization Expenses 99.54 78.79

Profit before Tax 13.62 58.77

Total Tax expanses/ (Credit) - 0.90

Net Profit after Tax 13.62 57.87

Earnings per equity share

Basic 3.30 14.16

Diluted 3.30 14.13

Balance as per last financial statement 192.68 89.86

Transferred from subsidiary companies - 63.89 pursuant to the Scheme of Amalgamation

Profit available for appropriation 206.30 211.62

Appropriations

Proposed Dividend on Equity Shares 4.15 10.28

Tax on proposed Equity Dividend 0.85 1.78

Transfer to Debenture Redemption Reserve 6.47 1.09

Transfer to General Reserve on Dividend - 5.79 declared

Adjustment of depreciation 9.36 -

Dividend Tax for previous year 0.04 -

Net Surplus in the Statement of 185.43 192.68 Profit and Loss

PVR Limited

2. Dividend

Your Directors have recommended a Final dividend of Re. 1.00 (Rupee One) per Equity Share for the financial year ended March 31, 2015 for your approval. The Dividend outgo will amount to Rs. 4.15 Crores (exclusive of Dividend Distribution Tax of Rs. 0.85 Crores).

3. Transfer to Reserve:

The Company has transferred Rs. 6.47 Crores to the Debenture Redemption Reserve.

4. Financial Review:

During the year under review Your Company entertained 59.2 million patrons in its cinemas, down by 1% as compared to the previous year, owing to disappointing box office performance of the movie content released during the year. The adverse impact of poor content quality to an extent was mitigated by improvement in non-box office revenues. Food and beverage revenues during the Financial Year 2014-15 showed a strong growth of 17% over Financial Year 2013- 14 on account of success of the various strategic initiatives taken by the company. Sponsorship Income showed a robust growth of 18% over same period last year. During the year, the company has opened 9 new properties with 50 screens and currently operates a network of 474 screens spread over 106 properties in 43 cities across the country. The company continues its aggressive expansion plan and intends to add approx 60-70 screens during the Financial Year 2015-16.

During the Financial year ended March 31,2015, the total income has increased from Rs. 1276.91 Crores during the preceding financial year to Rs. 1,389.21 Crores in the year under review registering a growth of 8.79%.

On 9th June, 2015, Your Company has entered into definitive agreements to acquire the cinema exhibition business of DLF Utilities Limited, which is operated under the brand name of "DT Cinemas", on a slump sale basis for an aggregate consideration of approximately Rs. 500 (Five hundred) Crores. DT Cinemas (DT) currently operates 29 screens with approximately 6,000 seats across 8 properties in the National Capital Region and Chandigarh. In the next 12 months, DT proposes to add 10 new screens at its two properties in the National Capital Region. The proposed transaction will be subject to approval of applicable statutory and regulatory approvals and satisfaction of customary conditions precedent.

In order to partly fund, the cost of acquisition of "DT Cinemas" your Company has raised funds to the tune of Rs. 350 Crores by issue of 50,00,000 equity share of face value of Rs. 10/- each at a premium of Rs. 690/- each share, allotted on 22nd July, 2015 to the following funds:

NAME NO. OF AMOUNT SHARES

Plenty CI Fund I Ltd. 4,33,143 30,32,00,100

Multiples Private 4,47,095 31,29,66,500 Equity Fund II LLP

Plenty Private Equity 41,19,762 2,88,38,33,400 Fund I Limited

TOTAL 50,00,000 3,50,00,00,000

Kindly refer to Management Discussion & Analysis and Corporate Governance Reports which forms part of this report for a detailed operation and business performance.

5. Future Outlook

While performance stood tepid in quarter four of Financial Year 2014-15, however consumer sentiment came back in first quarter of Financial Year 2015-16. Box office revenues have been very strong, with movies like Bajrangi Bhaijaan, a Salman Khan starrer, Bahubali & Drishyam.

Driven by strong box office performance during the first quarter in Financial Year 2015-16, your directors expect the momentum to continue in the forthcoming quarters on the back of strong content by movie pipeline. The content pipeline looks pretty promising and we expect a blockbuster Financial Year 2015-16. Our growing circuit of high quality cinemas and our company- wide emphasis on customer service excellence remain critical factors in our ability to generate positive operating results over the long-term. We have maintained the position as the leading multiplex player in India and soon will pass the 500 screens mark in next few months.

6. Report on the Performance & Financial Position of Subsidiaries

As on March 31, 2015 the Company had two Wholly-Owned Subsidiary companies namely PVR Pictures Limited and PVR Leisure Limited. PVR Leisure Ltd. has two subsidiary companies namely PVR Bluo Entertainment Limited and Lettuce Entertain You Limited.

Pursuant to Section 129(3) of the Companies Act, 2013 and Accounting Standard 21 issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company include the Financial Statements of its subsidiary companies.

Pursuant to Section 134 of the Companies Act, 2013 and Rule 8(1) of the Companies (Accounts) Rules, 2014 report on performance and financial position of subsidiaries is attached as per Annexure '1' which forms part of this report.

In terms of provisions under Section 136 of the Companies Act, 2013, audited accounts of the subsidiary companies are placed on its website at www.pvrcinemas.com

The Company will make available physical copies of these documents upon request by any shareholder of the Company. These documents shall also be available for inspection at the registered office of the Company during business hours up to the date of Annual General Meeting.

7. Corporate Governance

The Company is committed to uphold the highest standards of corporate governance and believes that the business relationship can be strengthened through corporate fairness, transparency and accountability. Your Company complies with all the mandatory provisions of Clause 49 of the Listing Agreement.

A report on Corporate Governance with a certificate from a practicing Company Secretary is enclosed and forms part of the Annual Report. A certificate from Chairman cum Managing Director and Chief Financial Officer of the Company, confirming the correctness of the financial statements, compliance with Company's Code of Conduct and adequacy of the internal control measures as enumerated and reporting of matters to the Audit Committee in terms of Clause 49 of the listing agreement is enclosed and forms part of this report.

8. Directors

Pursuant to Section 149 read with Section 152 and other applicable provisions, if any, of the Companies Act, 2013, one-third of such of the Directors as are liable to retire by rotation, shall retire every year and, if eligible, offer themselves for re-appointment at every Annual General Meeting. Consequently, Mr. Vicha Poolvaraluk and Ms. Renuka Ramnath will retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment in accordance with the provisions of the Companies Act, 2013.

Your Directors recommend, their appointment at the ensuing Annual General Meeting.

Pursuant to the provisions under Section 134(3)(d) of the Companies Act, 201 3, with respect to statement on declaration given by Independent Directors under Section 149(6) of the Act, the Board hereby confirms that all the Independent Directors of the Company have given a declaration and have confirmed that they meet the criteria of Independence as provided in the said Section 149(6).

9. Key Managerial Personnel

The Key Managerial Personnel (KMP) in the Company as per Section 2(51) and 203 of the Companies Act, 2013 are as follows:

* Mr. Ajay Bijli Chairman cum Managing Director

* Mr. Naresh Chandra Gupta Company Secretary

* Mr. Nitin Sood Chief Financial Officer

During the year, there was no change (appointment or cessation) in the office of any KMP.

10. Policy on Directors appointment and Remuneration Policy

Pursuant to the requirements under Section 134(3)(e) and Section 178(3) of the Companies Act, 2013, the policy on appointment of Board Members including criteria for determining qualifications, positive attributes, independence of a director and the policy on remuneration of directors, KMP and other employees is attached as Annexure '2' respectively, which forms part of this report.

1 1. Particulars of remuneration of Directors/ KMP/ Employees

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure "3' which forms part of this report.

In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration as per the limits set out in the said rules is attached as Annexure '4' which forms part of this report.

12. Employees Stock Option Plan

During the year 1,91,668 Equity Shares under PVR Employees Stock Option Scheme 2011, 2,14,500 Equity Shares under PVR Employees Stock Option Scheme 2012 and 16,500 Equity Shares under PVR Employees Stock Option Scheme 2013, were allotted to the permanent employees of the Company against same numbers of options exercised by them.

13. Meetings of the Board of Directors

During the Financial Year 2014-15, six Board Meetings were held. The details of Board Meetings and Committee Meetings held are given in the Corporate Governance Report.

14. Performance Evaluation of the Board, its Committees and Directors

Pursuant to applicable provisions of the Companies Act, 2013 and the Listing Agreement with Stock Exchanges, the Board, in consultation with its Nomination & Remuneration Committee, has formulated a framework containing, inter-alia, the criteria for performance evaluation of the entire Board of the Company, its Committees and Individual Directors, including Independent Directors.

In order to evaluate the performance and various aspects of the functioning of the Board and its Committees such as adequacy of the Constitution and Composition of the Board and its Committees, are assessed, matters addressed in the Board and Committee Meetings, processes followed at the meetings, Board's focus, regulatory compliances and Corporate Governance, etc are reviewed. Similarly, for evaluation of Directors' performance, his/her profile, contribution in Board and Committee Meetings, execution and performance of specific duties, obligations, regulatory compliances and governance are evaluated.

During the financial year under review the Independent Directors had met separately without the presence of Non-Independent Directors and the members of management and discussed, inter- alia, the performance of Non-Independent Directors and Board as a whole and the performance of the Chairman of the Company after taking into consideration the views of Executive and Non-Executive Directors.

The Nomination and Remuneration Committee has also carried out evaluation of every Director's performance.

The performance evaluation of all the Independent Directors have been done by the entire Board, excluding the Director being evaluated. On the basis of performance evaluation done by the Board, it shall be determined whether to extend or continue their term of appointment, whenever the respective term expires.

The Directors expressed their satisfaction with the evaluation process.

In compliance with the Companies Act, 2013 and clause 49 of the Listing Agreement, the performance evaluation of the Board was carried out during the year under review, details of which are given in Corporate Governance Report.

15. Directors' Responsibility Statement

Pursuant to requirements of Section 134(3)(c) of the Companies Act, 2013 with respect to Directors' Responsibility Statement, the Directors confirm:

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

b. That such accounting policies have been selected by them 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 as at March 3 1, 2015 and of the profit and loss of the Company for the year ended on that date;

c. That proper and sufficient care has been taken by them for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. That the annual accounts have been prepared by them on a going concern basis;

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

f. That they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

16. Statutory Auditors and their Report

The Company's Auditors, M/s. S. R. Batliboi & Co., LLP, Chartered Accountants having firm's Registration No.: 301003E will retire at the ensuing Annual General Meeting of the Company and being eligible for reappointment, have confirmed their eligibility and consented for re-appointment under Section 141 of the Companies Act, 2013 and the Rules framed there under as Statutory Auditors of the Company for the Financial Year 2015-16. As required under Clause 49 of the Listing Agreement, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

There are no observations (including any qualification, reservation, adverse remark or disclaimer) of the Auditors in their Audit Report that may call for any explanation from the Directors. Further, the notes to accounts referred to in the Auditor's Report are self- explanatory.

17. Secretarial Auditors and their Report

The Company has appointed M/s Arun Gupta & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit. The Report of the Secretarial Audit Report in MR-3 is annexed as Annexure '5'.

There are no qualifications or observations or other remarks of the Secretarial Auditors in the Report issued by them for the financial year 2014- 15 which call for any explanation from the Board of Directors.

18. Consolidated Financial Statements

In compliance with the applicable provisions of Companies Act, 2013 including the Accounting Standard 2I on Consolidated Financial Statements, this Annual Report also includes Consolidated Financial Statements for the Financial Year 2014-15.

During the period under review Consolidated Turnover grew by 9.36% to Rs. 1485.98 Crores as compared to Rs. 1358.83 Crores in the previous year. Net Profit after Tax for the year at Rs. 11.64 Crores is lower by Rs. 38.75 Crores as compared to Rs. 50.39 Crores in the Previous Year.

The audited consolidated financial statements together with Auditors' Report forms part of the Annual Report.

19. Internal Financial Control System

According to Section 134(5)(e) of the Companies Act, 2013 the term Internal Financial Control (IFC) means the policies and procedure adopted by the company for ensuring the orderly and efficient Conduct of its business, including adherence to company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

The Company has a well placed, proper and adequate Internal Financial Control System in place which ensures that all assets are safeguarded and protected and that the transactions are authorised, recorded and reported correctly. The Company's Internal Financial Control System also comprises due compliances with Company's policies and Standard Operating Procedures (SOPs) audit and compliance by Company's Internal Auditor M/s KPMG. The Internal Auditors independently evaluate the adequacy of internal controls and concurrently audit the majority of the transactions. Independence of the audit and compliance is ensured by direct reporting by Internal Auditors to the Audit Committee of the Board.

20. Adequacy of Internal Financial Controls with reference to the Financial Statements

The Companies Act, 2013 requires an effective Internal Financial Control System in the Company. The system should be designed and operated effectively. Rule 8(5)(viii) of Companies (Accounts) Rules, 2014 requires the information regarding adequacy of Internal Financial Controls with reference to the financial statements to be disclosed in the Board's report.

To ensure effective Internal Financial Controls the Company has laid down the following measures:

* All operations are executed as per prescribed procedures and is updated and validated periodically.

* All legal and statutory compliances are ensured on a monthly basis. Non- compliance, if any, is seriously taken by the management and corrective actions are taken immediately.

* The Company follows a robust 2-tier internal audit process:

* Tier-1 : Cinema audits are conducted on a regular basis throughout the year.

* Tier-2 : Transaction audits are conducted regularly, to ensure accuracy of financial reporting, safeguard and protection of all the assets.

* The audit reports for the above audits are compiled and submitted to Audit Committee for deliberations, review and necessary action.

* The Company uses Microsoft Navision Software for maintaining books of accounts and transactions are executed through prescribed procedures to ensure correctness/ effectiveness of all transactions, integrity and reliability of reporting.

* The Company has a comprehensive risk management framework.

* The Company has a robust mechanism of building budgets at an integrated cross-functional level. The budgets are reviewed on a periodically basis so as to analyze the performance and take corrective action, wherever required.

* The Company has in place a well-defined Whistle Blower Policy/Vigil Mechanism.

* The Company has a system of Internal Business Reviews. All departmental heads discuss their business issues and future plans in monthly Review Meetings. They review their achievements in the Review Meetings.

* Compliance of secretarial functions is ensured by way of secretarial audit and audit by the Internal Auditors - M/s KPMG.

21. Development and Implementation of Risk Management

Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Clause 49 of the listing agreement, the company has constituted a business risk management committee. The details of the committee and its terms of reference are set out in the Corporate Governance Report forming part of the Boards Report. At present the company has not identified any element of risk which may threaten the existence of the company.

22. Conservation of Energy, Technology Absorption, Foreign Exchange Earning and Outgo

Pursuant to provisions of Section 1 34 of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 the details of Conservation of Energy, Technology Absorption, Foreign Exchange Earning and Outgo are attached as Annexure '6' which forms part of this report.

23. Details of Policy developed and implemented on Corporate Social Responsibilities (CSR) initiatives

The Company has in place a CSR Policy in line with Schedule VII of the Companies Act, 2013. As per the policy, the CSR activities are carried by PVR Nest which focuses inter-alia on:

a) Education and social development of the most vulnerable sections of our society

b) Hunger, Poverty, Malnutrition and Health.

c) Sanitation and Safety

d) Gender Equality

e) Environmental Sustainability

The annual report on CSR activities is furnished in Annexure '7' which forms part of this report. Apart from this the Company also releases a detailed Business Responsibility Report and be available on its website www.pvrcinemas.com

24. Change in Capital Structure and Listing of Shares

The Company's shares are listed on the National Stock Exchange of India Limited (NSE) and BSE - Ltd (BSE).

During the year under review following shares were allotted and admitted for trading on NSE and BSE.

The Company allotted 1,91,668 Equity Shares under PVR Employees Stock Option Scheme 2011, 2,14,500 Equity Shares under PVR Employees Stock Option Scheme 2012 and 16,500 Equity Shares under PVR Employees Stock Option Scheme 2013, to the permanent employees of the Company against same numbers of options exercised by them.

The paid up equity share capital as on March 31, 2015 was Rs. 41,52,88,880. During the year under review, the Company issued 4,22,668 ESOP of Rs.10/- per equity shares. The company has not issued shares with differential voting rights nor granted stock options nor sweat equity. After the close of the Financial Year, 19,800 Equity Shares were allotted under PVR Employees Stock Option Scheme 2012. Further 50,00,000 Equity Shares were allotted on 22nd July, 2015 to three funds at a price of Rs. 700/- each share inclusive of share premium of Rs. 690/- each share details of which has already been provided in this report.

25. Extract of Annual Return

Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the extract of Annual Return as on March 3 1, 2015 in the prescribed Form No. MGT-9 is attached as Annexure '8' and forms part of this report.

26. Particulars of Loans, Guarantee or Investment under Section 186 of the Companies

Pursuant to Section 134(3) (g) of the Companies Act, 20 13 (Act) a statement containing of loans, guarantee or investment under Section 186 of the Act as at end of the Financial Year 2014-15 is attached as Annexure '9' which forms part of this report.

27. Contracts or arrangements with Related Parties under section 188(1) of the Companies Act, 2013

With reference to Section 1 34 (3) (h) of the Companies Act, 2013 (Act), all contracts and arrangements with related parties under Section 188(1) of the Act, entered by the Company during the financial year, were either in the ordinary course of business or an arm's length basis.

During the year, the Company has not entered into any contract or arrangement with related parties which could be considered 'material' according to the policy of the Company on Materiality of Related Party Transactions.

Your attention is drawn to the Related Party Disclosures set out in Note no. 43 of the Standalone Financial Statements.

28. Disclosure on Audit Committee

The Audit Committee as on 31st March 2015 comprises of the following independent directors.

Mr. Sanjai Vohra (Chairman), Mr. Amit Burman, Mr. Vikram Bakshi, Mr. Sanjay Kapoor and Mr. Sanjay Khanna as members.

Further, all recommendations of Audit Committee were accepted by the Board of Directors.

29. Disclosure on Vigil Mechanism

The Company has a vigil mechanism through Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. In staying true to our values of Strength, Performance and Passion and in line with our vision of being one of the most respected companies in India, the Company is committed to the high standards of Corporate Governance and stakeholder responsibility. The Company has Whistle Blower Investigation Committee which provide for adequate safeguards against victimization of persons and also provide for direct access to the Chairman of the Audit Committee and also to the members of the Committee.

The policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern.

The company has always provided a congenial atmosphere for work to all employees, free from discrimination and harassment including sexual harassment. It has provided equal opportunities of employment to all without regard to their caste, religion, colour, marital status and sex. The Company has also framed a policy on "Prevention of Sexual Harassment" at the workplace.

There were two cases reported during the year under review under the POSH Policy and necessary action was taken by the committee in due course of time. The enthusiasm and unstinting efforts of employees have immensely supported the Company to maintain its leadership position in its industry. Your Company has under taken various steps to further improve its overall performance.

30. Disclosure on Deposit under Chapter V

The Company has neither accepted nor renewed any deposits during the Financial Year 2014-15 in terms of Chapter V of the Companies Act, 2013.

31. Code of Conduct

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the company. The Company believes in "Zero Tolerance" against bribery, corruption and unethical dealings / behaviours of any form and the Board has laid down the directives to counter such acts. The code laid down by the Board is known as "code of business conduct" which forms an Appendix to the Code. The Code has been posted on the Company's website. The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. All the Board Members and the Senior Management personnel have confirmed compliance with the Code. All Management Staff were given appropriate training in this regard.

32. Transfer to Investor Education and Protection Fund

The Company has transferred a sum of Rs. 96,632 to the Investor Education and Protection Fund established by the Central Government, in compliance with the Companies Act 2013. The said amount represents unclaimed dividends which were lying with the Company for a period of seven years from their respective due dates of payment. Prior to transferring the aforesaid sum, the Company has sent reminders to the shareholders for submitting their claims for unclaimed dividends.

33. Acquisition of entire share capital held by L Capital Eco Limited in PVR Leisure Limited

On 5th March, 2015 the Company executed Shares Investment Agreement with L Capital Eco Limited to acquire from them 8,60,000 equity shares and 5,86,667 Compulsory Convertible Preference Shares of PVR Leisure Limited at a consolidated amount of Rs. 37 Crores.

34. Amalgamation of PVR Leisure Limited and Lettuce Entertain You Limited

The Directors of your Company in order to optimize group legal entity structure and to ensure greater alignment with the business and to achieve operational synergies, have approved merger of PVR Leisure Limited (a Wholly-Owned Subsidiary of the Company) and Lettuce Entertain You Limited (a Wholly-Owned Subsidiary of PVR Leisure Ltd.) Transferor Companies with PVR Limited, Transferee Company w.e.f the appointed date 1st April, 2015 subject to the approvals to be obtained from members, creditors and Hon'ble Delhi High Court besides other regulatory authorities.

35. Acquisitions of Equity Share Capital of Zea Maize (P) Ltd.

On 25th March, 2015, the Company has executed Shareholders Agreement for the acquisition of 70% equity share capital of Zea Maize (P) Ltd., which runs the Delhi based popcorn 'Chain 4700 BC Popcorn' for a consideration of about Rs. 5 crores to serve its gourmet popcorn to around 35 PVR Cinemas & later its services will be extended to Company's other Cinemas in Tier 1 cities.

36. Acknowledgements

Your Directors thank the various Central and State Government Departments, Organizations and Agencies for the continued help and co- operation extended by them. The Directors also gratefully acknowledge all stakeholders of the Company viz. customers, members, dealers, vendors, banks and other business partners for the excellent support received from them during the year. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.

For and on behalf of the Board

Place: Gurgaon Ajay Bijli Date: 22nd July, 2015 Chairman cum Managing Director




Mar 31, 2013

Dear Shareholders

The Directors have pleasure in presenting the 18th Annual Report on the business and operations of the Company and Audited Financial Statements for the year ended March 31, 2013.

Financial Highlights

(Rs. In Crores)

2012-13 2011-12

Income from Operations 669.37 476.04

Other Income 5.03 9.97

Total Income 674.40 486.01

Less:Total Expenditure 561.80 402.20

Earnings before depreciation/ amortization interest and tax (EBDITA) 112.60 83.81

Less : Finance Cost 25.45 17.96

Depreciation & Amortization Expenses 42.95 31.36

Profit before Tax 44.20 34.49

Total Tax expenses/(Credit) (10.65) 6.38

Net Profit after Tax 54.85 28.11

Earnings per equity share

Basic 18.42 10.50

Diluted 18.40 10.46

Balance as per last financial statement 40.47 33.95

Profit available for appropriation 95.32 62.06

Appropriations

Proposed dividend on Equity Shares 3.97 15.44

Tax on proposed equity Dividend 0.64 2.49

Transfer to Debenture Redemption Reserve 0.85 0.85

Transfer to General Reserve on Dividend declared - 2.81

Net surplus in the statement of Profit and Loss 89.86 40.47

Financial Review:

During the Financial year ended March 31, 2013, your Company has achieved new heights in terms of income and profitability. The total income has increased from Rs. 486 Crores, during the preceding financial year to Rs. 674 Crores in the year under review registering a growth of 38.68%. Operating Profit before interest, depreciation and tax increased to Rs. 112.60 Crores as against Rs. 83.81 Crores during the previous year.

Consistency across operations and ongoing expansion through organic and inorganic means has improved PVR''s position as the market leader in Film exhibition.

Kindly refer to Management Discussion & Analysis Report covered under Corporate Governance which forms part of this report for a detailed financial review.

Dividend

Your Directors have recommended a Final dividend of Re. 1/- (Rupee One) per Equity Share for the financial year ended March 31, 2013 for your approval. The proposed dividend outgo will amount to Rs. 3.97 Crores (exclusive of Dividend Distribution Tax of Rs. 0.64 Crores).

Operation Review

Kindly refer to Management Discussion & Analysis Report covered under Corporate Governance which forms part of this report.

Subsidiaries

As on March 31, 2013 the Company had three subsidiary companies namely PVR Pictures Limited (PVR Pictures) and Cine Hospitality Private Limited (CHPL), the wholly owned subsidiaries and PVR Leisure Limited, a Joint Venture Company in which your Company holds 53.68% in the equity share capital.

Cine Hospitality Private Limited

During the year under review, your Company (person acting in concert) through Cine Hospitality Private Limited a wholly Owned Subsidiary of your company (the Acquirer), acquired the entire stake of 69.27% of the paid-up Equity share Capital in Cinemax India Limited ("Cinemax'') from Kanakia''s family its erstwhile promoters, consisting of 19,394,816 Equity Shares. Subsequently, Cine Hospitality Private Limited (CHPL) in compliance with the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 made an open offer and acquired 66,97,189 Equity Shares representing 23.92% of the Paid-up Equity Share Capital of Cinemax from the Public Shareholders of Cinemax. Pursuant to the aforesaid acquisitions of shares @ Rs. 203.65 each share of Cinemax, your Company through CHPL now holds 93.19% paid up equity share capital of Cinemax. Consequent upon acquisition of Cinemax with 135 screens the combined numbers of screens have now increased to 383 screens at 90 locations.

Composite Scheme of Amalgamation

Cinemax India Limited and its subsidiaries (except Growel Entertainment Limited) are engaged into film exhibition business. The Audit Committee in the meeting held on 15th June 2013 recommended to the Board of Company as per Joint valuers'' Report & fairness opinion Report and the Composite Scheme of Amalgamation, for the merger (to be effective from 1st April 2013 the appointed date), of Cine Hospitality Private Limited ("CHPL"), a wholly owned subsidiary of the Company (being Special purpose vehicle) and Cinemax India Limited along with its 5 (five) subsidiaries namely Cinemax Motion Pictures Limited, Vista Entertainment Limited, Odean Shrine Multiplex Limited, Growel Entertainment Limited and Nikmo Entertainment Limited with PVR Limited.

The Board of Directors based on the recommendations of the Audit Committee, Joint Valuer''s Report dated 14th June 2013 received from M/s Hari bhakti & Co. and M/s SSPA & Co., the Independent Chartered Accountants, and in accordance with the Fairness Opinion Report dated 15th June 2013 of M/s Axis Capital Limited, a Category I Merchant Banker, approved the issue of 4 (Four) fully paid up equity shares of the face value of Rs. 10/- each in the share capital of PVR Ltd for every 7 (Seven) fully paid up equity share(s) of the face value of Rs. 5/- (Rupees Five) each of Cinemax India Limited to its members (holding shares in Cinemax on the record date to be fixed in due course), subject to the approval by the shareholders, creditors of the respective companies and Hon''ble High Court of Delhi. The proposed consolidation is expected to result into better synergies, smooth the business processes besides the combined resources can be put to the best advantages of all the stakeholders.

The company has filed applications under Clause 24 (f) of the Listing Agreement on 25th July 2013 with National Stock Exchange of India Limited and BSE Limited for their no- objection in respect of proposed Composite Scheme of Amalgamation.

PVR Leisure Limited

The Company was incorporated on 13.07.2012 as a Joint Venture Company by PVR Limited and L Capital Eco Limited, a Mauritius based Company, as Joint Venture partners, for the purpose of making downstream investment in Indian Companies. During the year under review your Company transferred its entire 51% shareholding in PVR BluO Enteratainment Limited and 100% shareholding in Lettuce Entertain You Limited to PVR Leisure Limited.

Consolidated Financial Statements

In compliance with the Accounting Standard 21 on Consolidated Financial Statements, this Annual Report also includes Consolidated Financial Statements for the Financial Year 2012-13.

Particulars under Section 212 of the Companies Act, 1956

The Ministry of Corporate Affairs, Government of India has granted a general exemption from attaching the audited accounts of the subsidiaries in the Consolidated Accounts of the Company vide General Circular No. 2/2011 dated 8th February, 2011 issued by Ministry of Corporate Affairs, Government of India.

Accordingly, your Company has provided consolidated accounts for financial year 2012-13 without detailed audited accounts of its subsidiaries.

Corporate Governance

The Company is committed to uphold the highest standards of corporate governance. Your Company strongly believes that the business relationship can be strengthened through corporate fairness, transparency and accountability. Your Company complies with all the mandatory provisions of Clause 49 of the Listing Agreement.

A report on Corporate Governance, along with a Certificate from a Practicing Company Secretary is enclosed and forms part of the Annual Report. A Certificate from Chairman cum Managing Director and Chief Financial Officer of the company, confirming the correctness of the financial statements, adequacy of the internal control measures as enumerated in Clause 49 of the Listing Agreement is also enclosed.

Management Discussion and Analysis Report

Management Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement, is presented in a separate section forming an integral part of this Annual Report.

Directors

Mr. Ravi Kumar Sinha and Mr. Sumit Chandwani, Directors of the Company resigned from the Board with effective from 05th December 2012 and 29th January 2013 respectively. The Board places on records, its deep appreciation of the valuable contribution made by Mr. Sinha and Mr. Chandwani during the tenure of their Directorships.

Mr. Ravinder Singh Thakran, Ms. Renuka Ramnath and Mr. Amit Burman were co-opted as Additional Directors on the Board of the Company effective from 08th October 2012, 30th January 2013 and 29th March 2013 respectively. Members of the Company under Section 257 of the Companies Act, 1956 have proposed the candidature of Mr. Ravinder Singh Thakran, Ms. Renuka Ramnath and Mr. Amit Burman for their Directorships. The Board recommends their appointments.

Mr. Vicha Poolvaraluk, a director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re- appointment. The Board recommends his reappointment. A brief resume of the Mr. Vicha Poolvaraluk seeking reappointment along with other details, is given as Annexure II to Director''s Report.

Fixed Deposits

During the year under review, your Company has not accepted any fixed deposits under Section 58A of the Companies Act, 1956 read with Companies (Acceptance of Deposit) Rules 1975.

Directors'' Responsibility Statement

Pursuant to the requirement under Section 2I7(2AA) of the Companies Act, 1956, with respect to Directors'' Responsibility Statement, the Directors confirm:

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

ii. That they had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii. That they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, I956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. That they had prepared the annual accounts for the Financial Year ended 31st March, 2013 on a going concern basis.

Employee Stock Option Scheme: "PVR ESOS 2012"

Your Company had obtained Members'' approval through Postal Ballot on 13th September 2012 for the implementation of PVR Employees Stock Option Scheme 2012 ("PVR ESOS 2012").

During the financial year under review the Compensation Committee in the meeting held on 14th January 2013 granted 5,50,000 Options to the employees of the Company at a price of Rs. 200/- per option in accordance with the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock purchase Scheme) Guidelines, I999 (''the SEBI Guidelines'').

The Disclosure as required under Clause 12.1 of the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, I999, as amended is set out in Annexure ''III'' to the Directors Report.

A certificate from the Statutory Auditors as per the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 ( Guidelines) confirming that "PVR ESOS 2012" has been implemented in accordance with the Guidelines, shall be placed before the shareholders at the ensuing Annual General Meeting.

Deferred Tax

The Company is entitled to exemption from payment of entertainment tax in respect of some of its multiplexes, in accordance with the scheme of the respective State Governments. The Company''s contention that Entertainment tax is a capital receipt and the Company''s appeal for not setting off such capital receipt from the value of fixed assets was rejected by Assessing Officer and Commissioner of Income Tax (Appeals) for Assessment Years 2006-07 onwards. The Company had filed appeal against the order of CIT (Appeals) before the Income Tax Appellate Tribunal (ITAT), Delhi in respect of the assessment year 2006-07 and 2007-08. The Income Tax Appellate Tribunal, Delhi for Assessment Year 2006-07 has accepted Company''s contention of treating Entertainment Tax as a capital receipt and for not setting off such capital receipt from block of fixed assets. Based on the above order and order pronounced by Honourable High Court of Gujrat and Mumbai in the similar matters during the year and also basis the tax opinion obtained, the Company has reversed deferred tax liabilities of Rs. 307,531,453 upto March 31, 2012 in the current year. However, the overall deferred tax credit is reduced by Rs. 178,180,078 during the current year on account of principles of virtual certainty.

Auditors'' Report

The Statutory Auditors of the Company, M/s. S. R. Batliboi & Co., LLP, Chartered Accountants having firm''s Registration No.: 30I003E hold office until the conclusion of the ensuing Annual General Meeting of the Company and are eligible for re- appointment and have confirmed that their reappointment if made, shall be within the limits of Section 224(IB) of the Companies Act, 1956. The Board recommends the reappointment of M/s S. R. Batliboi & Co., LLP, Chartered Accountants, as Statutory Auditors of the Company for the financial year 2013-14.

The Auditor''s observations and the relevant notes on the accounts are self-explanatory hence do not call for further comments.

Change in Capital Structure and Listing of Equity Shares

The Company''s equity shares are listed on the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE). During the year under review, the Company allotted 6,93,878 equity shares to Mr. Ajay Bijli, the promoter of the Company, 3,26,531 equity shares to Mr. Sanjeev Kumar, a resident Individual, 62,44,898 equity shares to L Capital Eco Limited and 46,49,326 equity shares to Multiples Private Equity Fund I Limited, both Mauritius based Companies besides I5,95,572 equity shares to Multiples Private Equity Fund, a SEBI registered Venture Capital Fund, on preferential Issue basis in accordance with chapter VII of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009.

Further, during the period under review the Company allotted 1,56,130 Equity Shares under PVR ESOS, 2008 and 1,31,329 equity shares under PVR ESOS 2011 Schemes, to the permanent employees of the Company against same numbers of options exercised by the employees pursuant to the aforesaid Employees Stock Option Schemes of the company.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

A statement giving details of Conservation of Energy, technology absorption, foreign exchange earnings and outgo, in accordance with Section 2I7(I)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, I988, is given as Annexure - I hereto and forms part of this report.

Particulars of Employees

The information as required in accordance with Section 2I7(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, is set out in Annexure ''II'' to the Directors'' Report. However, as per the provisions of Section 219 (I) (b) (iv) of the Companies Act, 1956, the Report and the Accounts are being sent to all the shareholders of the Company excluding the aforesaid information.

Any shareholder interested in obtaining such information may write to the Company Secretary at the Registered Office of the Company.

Acknowledgement

Your Directors place on record their gratitude to the shareholders, customers/patrons, suppliers, collaborators, bankers, financial institutions and all other business associates and Central Government and State Government for the incessant support provided by them to the company and their confidence in its management.

Your Directors also place on records their deep appreciation of the contribution made by the employees at all levels.

For and on behalf of the Board

Place: Gurgaon, Haryana Ajay Bijli

Date: 30th July, 2013 Chairman cum Managing Director


Mar 31, 2012

The Directors have pleasure in presenting the 17th Annual Report on the business and operations of the Company and Audited Financial Statements for the year ended March 31, 2012.

Financial Highlights

(Rs. In Crores)

2011-12 2010-11

Income from Operations 467.47 350.74

Other Income 11.27 10.32

Total Income 478.74 361.06

Less: Expenditure 397.62 298.10

Earnings before depreciation/ amortization interest and tax (EBDITA) 81.12 62.96

Add : Exceptional Items 2.69 -

EBDITA (Inclusive of Exceptional Items) 83.81 62.96

Less : Depreciation & Amortization Expenses 31.36 24.11

Finance Cost 17.96 15.96

Profit before Tax 34.49 22.89

Provision for Tax Credit/ (Expense) (net) (6.38) (6.55)

Net Profit after Tax 28.11 16.34

Balance brought forward from previous year 33.95 22.20

Profit available for appropriation 62.06 38.54

Appropriations

Transfer to Capital Redemption Reserve 1.39 -

Dividend on:

Equity Shares 15.44 2.86

Tax on Dividend 2.49 0.46

Transfer to Debenture Redemption Reserve 0.85 0.85

Transfer to general Reserve on Dividend declared 2.81 0.41

Balance Carried to Balance Sheet 40.47 33.95

Financial Review:

During the Financial year ended March 31, 2012, your Company has achieved new heights in terms of income and profitability. The total income increased from Rs. 361.06 Crores, during the preceeding year to Rs. 478.74 Crores in the year under review registering a growth of 32.57%. Operating Profit before interest, depreciation and tax increased to Rs. 81.12 Crores as against Rs. 62.96 Crores during the previous year.

Your company has recorded significant growth during the year under review. Consistency across operations and ongoing expansion has strengthened PVR's position as a leading Film exhibition company in India.

Kindly refer to Management Discussion & Analysis Report covered under Corporate Governance which forms part of this report for a detailed financial review.

Dividend

During the year, your Company has paid Rs. 4/- (Rupees Four) per Equity Share as Special Interim Dividend to the members of the Company.

Your Directors have recommend a Final dividend of Rs. 2/- (Rupees Two) per Equity Share for the financial year ended March 31, 2012 for your approval. The Dividend outgo inclusive of Special Interim Dividend amounts to Rs. 15.44 Crores (exclusive of Dividend Distribution Ta x of Rs. 2.49 Crores).

Operation Review

Kindly refer to Management Discussion & Analysis Report covered under Corporate Governance which forms part of this report.

Subsidiaries

As on March 31, 2012 the Company had two subsidiary companies PVR Pictures Limited (PVR Pictures), a wholly owned subsidiary and PVR bluO Entertainment Limited (PVR bluO) a Joint Venture Company. CR Retail Malls (India) Limited (CCR) ceased to be Company's subsidiary w.e.f. 17th May, 2011 i.e. the date of sale of the investment in Share Capital of CRR by your Company.

PVR Pictures Limited (PVR Pictures)

Your Company bought back on 5th July, 2011, 1,43,33,334 Equity Shares of PVR Pictures Limited, from JP Morgan Mauritius Holding IV Limited (71,66,667 Equity Shares) and IDBI Trusteeship Services Limited (India Advantage Fund) (71,66,667 Equity Shares). With the acquisition of balance 40% Share Capital of PVR Pictures Limited by your Company, PVR Pictures Limited has become the wholly owned subsidiary of your Company.

PVR bluO Entertainment Limited (PVR bluO)

Presently the Company operates two bowling alley centers at Ambience Mall-I, Gurgaon and Ambience Mall-II, at Vasant Kunj, New Delhi. The Company has made a roadmap for expansion of its business and will accordingly open additional bowling centers in India at Pune, Bangalore, Chandigarh, Ludhiana and Noida. These bowling centers on being operational are expected to enhance the income and profitability of the Company.

Consolidated Financial Statements

In compliance with the Accounting Standard 21 on Consolidated Financial Statements, this Annual Report also includes Consolidated Financial Statements for the Financial Year 2011-12.

Particulars under Section 212 of the Companies Act, 1956

The Ministry of Corporate Affairs, Government of India has granted a general exemption from attaching the audited accounts of the subsidiaries in the Consolidated Accounts of the Company vide General Circular No. 2/2011 dated 8th February, 2011.

Corporate Governance

The Company is committed to uphold the highest standards of corporate governance. Your Company strongly believes that this relationship can be strengthened through corporate fairness, transparency and accountability. Your Company complies with all the provisions of Clause 49 of the Listing Agreement.

A report on Corporate Governance, along with a Certificate from Practicing Company Secretary is enclosed. A Certificate from Chairman cum Managing Director and CFO, confirming the correctness of the financial statements, adequacy of the internal control measures as enumerated in Clause 49 of the Listing Agreement are also enclosed.

Management Discussion and Analysis Report

Management Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement, is presented in a separate section forming an integral part of this Annual Report.

Directors

Mr. Sanjai Vohra was co-opted as Additional Director on the Board of the Company effective from 30th September, 2011. A member of the Company under Section 257 of the Companies Act, 1956 has proposed the candidature of Mr. Vohra for the Office of the Director. Mr. Renaud Jean Palliere a Director of the Company has resigned from the Board of Directors of your Company w.e.f. 20th March, 2012. The Board places on records its appreciation of the valuable contribution made by Mr. Renaud during the tenure of his Directorship.

Mr. Ravi K. Sinha and Mr. Sanjay Khanna retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. A brief resume of the Directors retiring by rotation alongwith other details, is given in the Corporate Governance Report.

Fixed Deposits

During the year under review, your Company has not accepted any fixed deposits under Section 58A of the Companies Act, 1956 read with Companies (Acceptance of Deposit) Rules 1975.

Directors' Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors' Responsibility Statement, the Directors confirm:

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

ii. That they had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

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

iv. That they had prepared the annual accounts for the Financial Year ended 31st March, 2012 on a going concern basis.

CR Retail Malls (India) Limited

During the year under review, your Company sold its investments in the Equity Share Capital of Tw o Crore Equity Shares of Rs. 10/-each aggregating to Rs. 20 Crores of CR Retail Malls (India) Limited a wholly owned subsidiary of the Company to M/s JM Financial Products Limited and JM Financial Investment Managers Limited at a consideration of Rs. 40.31 Crores. Through a long term lease back arrangement, operations of Seven Screen Multiplex at Lower Parel, Phoenix Mills Compound, Mumbai was transferred to PVR Limited from 22nd April, 2011. The profit on sale of investments amounting to Rs. 16.86 Crores has been disclosed as an exceptional item vide note no. 37 and 42 of the enclosed audited Annual Accounts for financial year 2011-12.

Buy-Back of Company's Own Equity Shares

The Board of Directors at the meeting held on 27th May, 2011 had approved a Scheme of Buy-Back of Company's own equity shares at a price not exceeding Rs. 140/- per share upto an amount not exceeding Rs. 26.21 Crores, i.e. 10% of the paid-up equity shares capital and free-reserves as per last audited accounts in accordance with the applicable provisions under the Securities and Exchange Board of India (Buy Back of Securities) Regulations, 1998.

The Company, till close of the buy-back offer on 29th August 2011 bought back 13,88,328 Equity Shares of the Company for a sum of Rs. 15.82 Crores.

Sanction of Composite Scheme of Arrangement

Pursuant to the Composite Scheme of Arrangement filed by the Company, the Hon'ble High Court of Delhi on February 2, 2012, approved the transfer of the production business undertaking from PVR Pictures Limited into the Company with effect from April 1, 2011 and the same has become effective from February 29, 2012. PVR Pictures Limited being wholly owned subsidiary of your Company therefore no shares were issued to PVR Limited, on merger of production business undertaking into your company.

The Composite Scheme of Arrangement further provided that from the effective date, relevant assets, after having deferred tax adjustments and proportionate reduction in value of investments in subsidiary, be adjusted to their fair values, by setting- off against specified reserves (including Securities Premium Account). Accordingly the Company has written down the value of such assets by Rs. 49.37 Crores and set off the same against reserves as per the aforesaid scheme.

Employee Stock Option Plan: "PVR ESOP Scheme 2011"

Your Company had obtained Members' approval through Postal Ballot on 4th October 2011 for the introduction and implementation of PVR Employees Stock Option Scheme 2011.

During the financial year under review the Compensation Committee in the meeting held on 5th October 2011 granted 5,50,000 Options to the employees of the Company at a fair market price of Rs. 116.15/- per option in accordance with the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock purchase Scheme) Guidelines, 1999 ('the SEBI Guidelines'). The Compensation Committee administers and monitors the said Scheme.

The Disclosure as required under Clause 12.1 of the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, as amended is set out in Annexure 'III' to the Directors Report.

The certificate from the Statutory Auditors under the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, confirming that the PVR ESOS 2011 has been implemented in accordance with the guidelines and will be placed before the shareholders at the ensuing Annual General Meeting.

Service Tax

The Finance Act, 2010 has defined the "Renting of the Immovable Property" as a taxable service with retrospective effect from June 1, 2007. The Company had challenged the levy of Service Tax on renting of commercial properties before the Hon'ble High Court of Delhi which had granted an interim stay against the levy of service tax. Based on the advice obtained by the Company, no provision of Service Tax in respect of commercial properties was made by the Company in earlier years. In 2011, the Hon'ble High Court of Delhi, upheld the levy of Service Tax vide its order dated September 23, 2011. The Company had filed Special Leave Petition ("SLP") before Hon'ble Supreme Court of India against the order of the Hon'ble High Court of Delhi which is currently pending. Your company has made payments towards service tax as per direction of the Hon'ble Supreme Court of India.

Accordingly an amount of Rs. 7.91 Crores (net of CENVAT Credit) being provision for financial year 2012 has been included in Rent Expenses and amount of Rs. 14.16 Crores (net of CENVAT Credit) being the provision from June 1, 2007 upto March 31, 2011 has been adjusted from Exceptional Income.

Auditors' Report

The Statutory Auditors of the Company, M/s. S. R. Batliboi & Co., Chartered Accountants, having firm's Registration No.: 301003E, Gurgaon, hold office until the conclusion of the ensuing Annual General Meeting of the Company and are eligible for re-appointment and have confirmed that their reappointment if made, shall be within the limits of Section 224(1B) of the Companies Act, 1956. The Board recommends the re- appointment of M/s S. R. Batliboi & Co., Chartered Accountants as Statutory Auditors of the Company.

The Auditor's observations and the relevant notes on the accounts are self-explanatory and therefore, do not call for further comments.

Change in Capital Structure and Listing of Equity Shares

The Company's shares are listed on the National Stock Exchange of India Limited (NSE) and Bombay Stock

Exchange Limited (BSE). During the year under review, 1,41,620 Equity Shares were allotted to employees of the Company on 8th June, 2011, 19th September, 2011 and 29th March, 2012 against same numbers of options exercised by employees pursuant to Employees Stock Option Scheme of the company.

Conservation of Energy, Technology Absorption, Foreign Exchange Earning and Outgo

A statement giving details of Conservation of Energy, technology absorption, foreign exchange earnings and outgo, in accordance with Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is given as Annexure - I hereto and forms part of this report.

Particulars of Employees

The information as required in accordance with Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, is set out in Annexure 'II' to the Directors' Report. However, as per the provisions of Section 219 (1) (b) (iv) of the Companies Act, 1956, the Report and the Accounts are being sent to all the shareholders of the Company excluding the aforesaid information. Any shareholder interested in obtaining such information may write to the Company Secretary at the Registered Office of the Company.

Acknowledgement

Your Directors place on record their gratitude to the shareholders, customers/patrons, suppliers, collaborators, bankers, financial institutions and all other business associates and Central Government and State Government for the incessant support provided by them to the company and their confidence in its management.

Your Directors also place on records their deep appreciation of the contribution made by the employees at all levels.

For and on behalf of the Board

Place: Gurgaon, Haryana Ajay Bijli

Date: 29th May, 2012 Chairman cum Managing Director


Mar 31, 2011

The Directors have pleasure in presenting the Sixteenth Annual Report on the business and operations of the Company and Audited Financial Statements for the year ended March 31, 2011.

Financial Highlights

(Rs. In Lacs)

2010-11 2009-10

Income 36,002 28,065

Expenditure 29,926 24,892

Earnings before depreciation/ amortization interest and tax (EBDITA) 6,076 3,173

Depreciation 2,411 2,162

Interest 1,374 986

Profit before Tax 2,291 25

Provision for Tax Credit/ (Expense) (net) (657) 1

Profit after Tax 1,634 26

Balance brought forward from previous year 2,220 2,749

Accumulated profit brought forward of Sunrise Infotainment Pvt. Ltd. - 29

Loss after tax of 2008-09 of Sunrise Infotainment Pvt. Ltd. - 2,220 (263) 2,515

Profit available for appropriation 3,854 2,541 Appropriations

Transfer to Debenture Redemption Reserve 85 21

Transfer to General Reserve 41 -

Dividend on Equity Shares 286 256

Tax on Dividend 46 44

Balance carried over to Balance Sheet 3,396 2,220

Financial Review:

While the performance of the Company for the first nine months of 2010-11 was decent, however the fourth quarter was impacted due to the Cricket World Cup as no blockbuster movies were released during the period. On an overall basis, the company has been able to demonstrate promising growth in revenues led by 7%-10% growth in ticket pricing and food & beverage realizations across the same stores.

The success of big blockbuster movies like "Rajneeti", "Housefull" and "Dabangg" boosted the film industrys fortune. Small Budget movies like "Peepli Live", "Phas Gaye Re Obama", "Tanu Weds Manu" among others also did well at the Box Office.

During the financial year under review the total income of the Comapny were Rs. 360 Crores as compared to Rs. 280.6 Crores in 2009-10, up by 28%. EBITDA for 2010-11, were Rs. 60.7 Crores as compared to Rs. 31.7 Crores in 2009-10, up by 91%. Profit after Tax for 2010-11 was Rs. 16.3 Crores as compared to Rs. 0.26 Crores in 2009-10.

The company at present operates 33 properties with 142 screens in 18 cities across the country. The company added 19 Screens at 3 locations i.e. Chennai, Ahmadabad and Lucknow in 2010-11. The Company had signed Agreements/MOUs for 75-80 screens for the coming financial year in different parts of the country including cities like Udaipur, Vijaywada, Delhi, Mysore, Bangalore, Bhopal, Pune etc. which will further boost the revenues and profitability of the company.

The pipeline of the movies for FY 2011-12 looks exciting and the company expects its revenues to consolidate further on the strength of its properties in the best locations.

The company expects that about 25-30 3D films that are expected to be released in financial year 2011-12, will fetch higher ticket prices. The company also has a plan to install digital IMAX theatre systems at its four locations in India. The first two of them would be installed within the next 12 months at Companys two multiplexes in Mumbai and Bangalore.

Dividend

Your Directors are pleased to recommend a dividend of 10% (Re. One per Equity Share) for the financial year ended March 31, 2011.

Operations Review

Kindly refer to Management Discussion & Analysis Report covered under Corporate Governance which forms part of this report.

Subsidiaries

As on March 31, 2011 the Company had three subsidiary companies namely M/s CR Retail Malls (India) Limited (CRR) a wholly owned subsidiary, M/s PVR Pictures Limited (PVR Pictures) and M/s PVR bluO Entertainment Limited (PVR bluO).

CR Retail Malls (India) Limited (CRR)

CR Retail Malls (India) Limited operates the 7 screen Multiplex at "The Phoenix Mills Compound" at Lower Parel, a prime retail and entertainment destination in Mumbai. CRR during the period 2010-11 recorded an income of Rs. 28.65 Crores and a Net Profit of Rs. 4.06 Crores.

On 5th May, 2011, PVR Ltd. entered into an arrangement with JM Financial group of Companies for sale of equity shares of CRR. Under the terms of sale of entire equity share of CRR, PVR Ltd. has realized Rs. 100 Crores. PVR has also entered into a lease agreement with CRR to continue to operate the multiplex property on a long term lease basis.

PVR Pictures Limited (PVR Pictures)

PVR Pictures is in the business of film production & distribution. The year under review was adversely impacted on account of poor performance of companys production "Khelein Hum Jee Jaan Sey". As a result the company incurred a loss of Rs. 22.18 Crores at PAT level during 2010-11. The loss after excluding Minority Interest was Rs. 13.31 Crores.

Due to these losses both the investors i.e., JP Morgan Mauritius Holdings IV Limited and India Advantages fund (IAF) have shown their intention for exiting from the company. Your company ("PVR Limited") has now decided to purchase balance 40% equity share capital of PVR Pictures Limited from the said two investors and pay Rs. 60 Crores i.e., Rs. 30 Crores to each of the said two Investors. Post acquisition of 40% share capital by PVR Limited, PVR Pictures Limited shall become a wholly owned subsidiary of your Company.

The company is in the process of completing a movie "Shanghai" which is being directed by Dibakar Banerjee starring Abhay Deol and Emran Hashmi and is expected to be released in the third quarter of the FY 2011-12.

PVR bluO Entertainment Limited (PVR bluO)

PVR bluO in the financial year 2010-2011 earned a Net Revenue of Rs.14.27 Crores and a Profit after Tax of Rs. 2.08 Crores.

Presently the company operates Indias largest bowling alley center in Ambience Mall, Gurgaon. The center has been able to establish itself as a premier leisure and entertainment destination for consumers in NCR. The Company has made a roadmap for expansion of its business and has plans to open additional 3-4 bowling centres in India in next 12 months.

Consolidated Financial Statements

In compliance with the Accounting Standard 21 on Consolidated Financial Statements, this Annual Report also includes Consolidated Financial Statements for the Financial Year 2010-11.

Particulars under Section 212 of the Companies Act, 1956

The Ministry of Corporate Affairs, Government of India has granted a general exemption, for attaching the audited accounts of the subsidiaries in the Consolidated Accounts of the Company vide general circular no. 2/2011 dated 8th February, 2011.

Corporate Governance

The Company is committed to uphold the highest standards of corporate governance. Your Company strongly believes that this relationship can be strengthened through corporate fairness, transparency and accountability. Your Company complies with all the provisions of Clause 49 of the Listing Agreement.

A report on Corporate Governance, along with a Certificate from Practising Company Secretary is enclosed. A Certificate from Chairman cum Managing Director and CFO, confirming the correctness of the financial statements, adequacy of the internal control measures as enumerated in Clause 49 of the Listing Agreement are also enclosed.

Management Discussion and Analysis Report

Management Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement, is presented in a separate section forming an integral part of this Annual Report.

Directors

In accordance with the provisions of Sections 255 and 256 of the Companies Act, 1956 and Articles of Association of the Company, Mr. Vikram Bakshi and Mr. Sumit Chandwani, retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The Board recommends their re-appointment as Directors of the Company.

Fixed Deposits

During the year under review, your Company has not accepted any fixed deposits under Section 58A of the Companies Act, 1956 read with Companies (Acceptance of Deposit) Rules 1975.

Directors Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors Responsibility Statement, the Directors confirm:

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

ii) That they had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

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

iv) That they had prepared the annual accounts for the Financial Year ended 31st March, 2011 on a going concern basis.

Group Companies

Pursuant to the provisions under the Monopolies Restrictive Trade Practices Act, 1969, read with the relevant provisions under the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, ("SEBI Regulations, 1997") and all other applicable laws, persons constituting group for availing of various exemptions from the applicability of the provisions of various Regulations under the SEBI Regulations, 1997, Income Tax Act, 1961 are given in the MDA.

Buy Back of Companys own Equity Shares

The Board of Directors in the meeting held on 27th May, 2011 approved buy back of Companys own Equity Shares from the Stock Exchanges for a sum not exceeding Rs. 26.21 Crores i.e., 10% of the paid up Equity Share Capital and Free Reserves at a price not exceeding Rs. 140 each equity share of face value of Rs. 10 each in accordance with the applicable provisions under the securities and exchange board of India Buy Back of Securities regulations 1998.

Auditors Report

The Statutory Auditors of the Company, M/s. S. R. Batliboi & Co., Chartered Accountants, Gurgaon, hold office until the conclusion of the ensuing Annual General Meeting of the Company and are eligible for re-appointment and have confirmed that their re- appointment if made, shall be within the limits of Section 224(1B) of the Companies Act, 1956. The Board recommends the re-appointment of M/s S. R. Batliboi & Co., Chartered Accountants as Statutory Auditors of the Company.

The Auditors observations and the relevant notes on the accounts are self-explanatory and therefore, do not call for further comments.

Change in Capital Structure and Listing of equity shares

The Companys shares are listed on the National Stock Exchange of India Limited (NSE) and Bombay Stock Exchange Limited (BSE). During the year, 14,60,112 Equity Shares of face value of Rs. 10 each were allotted to the Equity Shareholders of M/s Leisure World Private Limited on 8th September, 2010, pursuant to the Order of the Honble High Court of Delhi dated 19th August, 2010.

Further 57,330 Equity Shares were allotted to employees of the Company on 31st August, 2010, 1st November, 2010, 30th November, 2010 and 6th January, 2011 against 57,330 options exercised by employees pursuant to Employees Stock Option Scheme of the company.

Conservation of Energy, Technology Absorption, Foreign Exchange Earning and Outgo

A statement giving details of Conservation of Energy, technology absorption, foreign exchange earnings and outgo, in accordance with Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is given as Annexure - I hereto and forms part of this report.

Particulars of Employees

The information as required in accordance with Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, is set out in Annexure II to the Directors Report. However, as per the provisions of Section 219 (b) (iv) of the Companies Act, 1956, the Report and the Accounts are being sent to all the shareholders of the Company excluding the aforesaid information. Any shareholder interested in obtaining such information may write to the Company Secretary at the Registered Office of the Company.

Acknowledgement

Your Directors place on records their gratitude to the shareholders, customers/patrons, suppliers, collaborators, bankers, financial institutions and all other business associates and Central Government and State Government for the incessant support provided by them to the company and their confidence in its management.

Your Directors also place on records their deep appreciation of the contribution made by the employees at all levels.

For and on behalf of the Board

Place: Gurgaon, Haryana Ajay Bijli

Date: May 27th, 2011 Chairman cum Managing

Director


Mar 31, 2010

The Directors present the 21st Annual Report together with the audited accounts for the year ended 31s1 March, 2010.

FINANCIAL RESULTS

Rs in lakhs

Year Year

ended ended

2010 2009

Income 3076.44 2723.04

Gross Profit before Interest & Depreciation 213.32 266.74

Interest (56.91) (7.43)

Depreciation (46.79) (92.68)

Profit/(loss) for the year 109.61 166.63

Loss brought forward

from previous year (2149.19) (2315.81)

Loss carried forward to

Balance Sheet (2039.57) (2149.18)

Loss carried forward to Balance Sheet is Rs 2039.57 lakhs.

PERFORMANCE

Lotus sales turnover at Rs.3076.44 Lakhs was up 12.98 % over last year. The Company continued to follow its policy of offering value to the customers with sales prices just below inflation. The Companys volumes however remain stagnates as the capac ity available was just sufficient to meet the existing market presence. The Management is addressing this area of concern as major initiatives are planned during the current fiscal year. Your companys performance has been led through modest investments in our brands , products, innovation initiatives, expansion into new product categories and an upheard task in managing operating costs through cost efficiency measures.

In the current year the actual production was 5885.66 MT as against 6988.06 MT during the previous year giving a moderate dip of 18.73%.

Concerted efforts have contributed to increase in revenue by 12.98% over previous year to Rs.3076.44 lakhs and record a net profit of Rs. 109.61 lakhs.

Your company has achieved these results despite significant increase in input costs, particularly cocoa beans, sugar, oils and fats coupled with aggressive pricing in the trade and industry.

Despite stiff competition your company stabilized and held its market share, even though 2009 was a challenging year, your company continues to operate with minimum trade pipelines selling as per the market demands and maintaining a very efficient supply chain.

BUSINESS PLAN

The promoters who acquired the business in the year 2008 has acknowledged for their understanding of common needs and robust business model. During the year the company sustained focus on generating consumer insights, innovation and renovation while continuing it on going efforts to strengthen capabilities, augment equipment capacities that continue to delight the consumers and help it to leverage its trusted brands.

Further new chocolate products will be introduced later this year.

We envisage a pan India performance by the end of this fiscal, towards this, have opened up all the markets of North India. Further we have concluded an agreement with the reputed Oil Company i.e Bharat Petroleum Corporation Limited(BPCL) for distribution of our consumer brand chocolates through their strong network.

ISO CERTIFICATION

Your companys manufacturing factory located at Narsapur, Medak District has been certified to the latest version of IS 22000 (FSMS- Standard for Food Safety Management System) by Llyods, a leading International Certification Company.

This certification indicates our commitment in meeting in a sustainable manner, global quality, environment, health and safety standards. This is a milestone in our quest for quality.

Our Company has been rated by CRISIL as SME III.

RESEARCH AND DEVELOPMENT

The research and development (R & D) function has led a significant role to play in supporting the performance of the Company this year. Their major area of contribution lay in fuelling innovation through a number of new product development, culminating in the launch of various new products during the year.

The management intends to create the function of Innovation by engaging best leveraging external expertise to value add to our R&D programme with a view to building the medium and long term pipelines.

BIFR

A reference in terms of Section 15(1) of the Sick Industrial Companies(Special Provisions) Act, 1985 has been done and registered with the Board of Industrial and Financial Reconstrution (BIFR) for determination of the measures which shall be adopted with respect to the Company, further the company is awaiting for the hearing of the same.

PARTICULARS OF EMPLOYEES

During the year under review, none of the employees of the Company have drawn remuneration as specified under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975.

PARTICULARS REGARDING ENERGY CONSERVATION ETC.

The particulars required under 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 annexed to this Report.

DEPOSITS

The Company has not accepted any deposit during the year under review.

BOARD OF DIRECTORS

Shri Prakash Pai and Shri Anantha Pai, Directors retires by rotation at the 21st Annual General Meeting and being eligible offers themselves for reappointment.

AUDITORS

M/s S R Mohan & Company, Chartered Accountants, Hyderabad, Statutory Auditors of your Company hold office until the conclusion of the

21st Annual General Meeting and are being proposed for re-appointment. The Company has received a certificate from them to the effect that their appointment if made would be within the limits prescribed under Section 224(1) of the Companies Act, 1956.

DIRECTORS RESPONSIBILITY STATEMENT

The Board submits as under:

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

- that the directors had selected such accounting policies 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 or loss of the company for that period;

- that the directors had 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;

- that the directors had prepared the annual accounts on a going concern basis.

ACKNOWLEDGEMENT

Yours Directors place on record the appreciation for the sincere efforts and hard work put in by the employees of the Company in its operations. The Directors acknowledge the support and co - operation received from Banks and other Governmental Agencies.

The Directors express their gratitude to the shareholders of the Company for the confidence and faith reposed in the management.

For and on behalf of the Board



Sd/- Sd/-

P.Anantha Pai G.S.Ram

Director Whole Time Director

Place : Hyderabad

Date : 13.08.2010

 
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