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Directors Report of Shemaroo Entertainment Ltd.

Mar 31, 2015

Dear Members,

The Directors take pleasure in submitting their 10th Annual Report on the business and operations of your Company together with the Audited Financial Accounts for the financial year ended March 31, 2015.

ft In Lacs)

Current year Previous year 2014-2015 2013-2014

Income:

Sales & Services 32,345 26,334

Other Income 126 73

Total Income 32,471 26,407

Direct Operational Expenses 29,272 21,858

Changes in inventories of finished goods, work-in-progress and Stock-in-Trade (8,987) (5,154)

Employee benefit expense 1,792 1,794

Financial Costs 2,121 1,923

Depreciation and amortization expense 368 296

Other expenses 1503 1,261

Total expenditure 26,068 21,978

Profit Before Taxation 6,403 4,430

Tax Expenses Current Tax:

Income Tax 2,359 1,293

Wealth Tax 1 1

Tax in respect of earlier years 27 11

Deferred Tax (165) 340

Profit After Taxation 4,181 2,785

Transfer to General Reserve (105) (70)

Proposed Dividend (326) (99)

Dividend Distribution Tax (66) (17)

Review of Operations

During the year under review, the Standalone Revenue from Operations & Other Income increased to Rs. 32,345 Lacs as against Rs. 26,334 Lacs in the previous year and the Consolidated Revenue from Operations & Other Income increased to Rs. 32,471 Lacs as compared to Rs. 26,407 Lacs in the previous year.

Your Company had a standalone growth with a Net Profit after- tax of Rs. 4,181 Lacs as compared to the Net Profit after tax of Rs. 2,785 Lacs in the previous financial year and a consolidated growth with a Net Profit after tax of Rs. 4,092 Lacs as compared to the Net Profit after tax of Rs. 2,716 Lacs in the previous financial year.

Subsidiaries and Associate Companies

As on March 31, 2015 your company has 2 (two) foreign wholly owned subsidiary companies, namely, Shemaroo Entertainment INC (USA) and Shemaroo Entertainment (UK) Private Limited, 1 (One) Indian wholly owned subsidiary company, Shemaroo Films Private Limited and 1 (One) Associate company, Vistaas Digital Media Private Limited.

Pursuant to Section 129(3) read with Rule 8 of the Companies (Accounts) Rules, 2014, a statement containing the salient features of the financial positions of the subsidiaries/associate company in Form AOC-1 for the financial year ended March 31, 2015 is provided under Consolidated Financial Statements of the Company.

Pursuant to Clause 49 of the Listing Agreement, the Company has also formulated a Policy for determining material subsidiaries which is uploaded on the website of the Company i.e.http://www.shemarooent.com/?p=Code of Conduct.

Consolidated Financials

The consolidated financial statements presented by the Company are prepared in compliance with applicable provisions of the Companies Act, 2013, Accounting Standards and Listing Agreement as prescribed by the Securities and Exchange Board of India (SEBI). The consolidated financial statements have been prepared on the basis of audited financial statements of the Company, its subsidiary and associate companies, as approved by their respective Board of Directors.

Management Discussion and Analysis

A detailed Management Discussion and Analysis forms part of this report.

Initial Public Offering (IPO)

It is a moment of immense pride that your Company has successfully completed the Initial Public Offering (IPO) of its equity shares. The success of our IPO has shown us the trust & confidence that our customers, business partners and markets are having in the brand 'Shemaroo'.

During the financial year under review, your Company made an Initial Public Offering of 7,333,335 equity shares of face value of Rs. 10 per equity shares at a price of Rs. 170 per equity share including a share premium of Rs. 160 per equity share aggregating to Rs. 12000 lacs. The Company also offered a discount of 10% (i.e. Rs. 17) to all Retail Individual Bidders. The Bid issue was opened on September 16, 2014 and closed on September 18, 2014.

The IPO saw a good response across various categories of investors and overall our issue was subscribed 7.90 times. Retail Individual bidders quota was subscribed 8.29 times and Non institutional bidders quota was subscribed 9.11 times Qualified Institutional bidders (excluding anchor investors) quota was subscribed 6.24 times and Anchor investors quota was subscribed 1 times.

The equity shares of the Company are listed on BSE Limited (Designated Stock Exchange) and National Stock Exchange of India Limited.

The annual listing fee for the financial year 2015-2016 has been paid.

Utilisation of funds raised through Initial Public Offering (IPO) of equity shares to fund working capital requirements is as follows.

(Rs. In Lacs)

Particulars March 31, 2015

Net Issue Proceeds (Net off Issue Expenses) 12,000.00

Less: Issue Expenses paid upto 31.03.2015 1,139.35

Net proceeds from IPO 10,860.65

Amount utilised (to fund working capital 6,723.56

requirements)

Funds to be utilised (remain invested in mutual 4,137.09 funds, current account and cash credit account)

Pursuant to Clause 43 of the Listing Agreement, there are no variations between the projected utilisation of funds and/ or projected profitability statement made in prospectus and the actual utilisation of funds and / or actual profitability and pursuant to Clause 43A of the Listing Agreement, there are no material deviations in the use of proceeds of Public Issue from the objects stated in the offer document.

Dividend

Based on the Company's performance, the Directors are pleased to recommend for approval of the members, a final dividend of Rs. 1.20 (Rupee One and twenty paisa only) per fully paid-up equity shares of Rs. 10 each (i.e. 12% of the paid-up equity share capital of Company) for the financial year ended March 31, 2015.

The final dividend on equity shares, if approved by the members would involve a cash outflow of Rs. 392.59 Lacs including dividend distribution tax.

Appropriations - Transfer To General Reserve

We propose to transfer Rs. 105 Lacs to the general reserve out of the amount available for appropriation and amount of Rs. 4,285 Lacs is proposed to be retained in the profit and loss account.

Capital Structure

During the Financial year 2014-2015, your Company has made an Initial Public Offering of 7,333,335 equity shares of face value of Rs. 10 each for cash at a price of Rs. 170 per equity share including a share premium of Rs. 160 per equity share, aggregating up to Rs. 12,000 lacs. The issue constituted 26.98% of the fully diluted post-issue paid up capital of your company. Accordingly, the Company's issued, subscribed and paid-up share capital of the Company increased from Rs. 19,84,89,040 to Rs. 27,18,22,390.

Of the total paid up share capital of the Company, 65.82% is held by Promoters and Promoter Group, all in dematerialized form. The balance i.e. 34.18% of the total paid up share capital of the Company is held by persons other than Promoters and Promoter Group of which 96.73% of shares are held in dematerialized form.

Number of meetings of the Board

During the financial year under review, five (5) Board meetings were held. For details of the meeting of the Board, please refer to the Corporate Governance report, which forms part of this report.

Directors & Key Managerial Personnel

At present your Company's Board of Directors has an optimum mix of Executive and Non-Executive Directors. Out of total Ten (10) Directors, the Board comprises of Three (3) Executive Directors [(i.e. Two (2) Managing Directors and One (1) Whole Time Director & CFO)], Two (2) Non-Executive Non-Independent Directors and Five (5) Non-Executive Independent Directors [includes 1(one) Women Director]. The Chairman of the Board is a Non-Executive Director related to the Promoters and accordingly, Half (1/2) of the Board consists of Independent Directors.

i) Appointment of Independent Directors

In accordance with the provisions of the Companies Act,1956, the Company had appointed Mr. Jayesh Parekh, Mr. Vasanji Mamania, Mr. Gnanesh Gala, Mr. Kirit Gala and Mr. Shashidhar Sinha as Independent Directors on the Board of our Company on August 29, 2011.

Pursuant to the provisions of section 149 of the Act and any other applicable provisions of the Companies Act, 2013 with respect to the Independent Directors which came in to effect from April 1, 2014, the Board of directors decided to adopt the provisions with respect to appointment and tenure of Independent Directors which is in consonance with the provisions of the Companies Act, 2013 and the Listing Agreement, as amended.

Accordingly, the Board in its meeting dated April 26, 2014, subsequently approved by the shareholders in its Extra Ordinary meeting dated May 26, 2014, re-appointed Mr. Jayesh Parekh, Mr. Vasanji Mamania, Mr. Gnanesh Gala, Mr. Kirit Gala and Mr. Shashidhar Sinha, as Independent Directors of the Company, whose term of office shall not be subject to retirement by rotation, for a term of 5 (five) years up to May 25, 2019.

ii) Chief Financial Officer (CFO):

Pursuant to the provisions of Section 203 of Companies Act, 2013, the Company was required to appoint a Whole Time Key Managerial Personnel as the Chief Financial Officer of the Company.

Accordingly, keeping in view the compliance of the provisions of the Companies Act, 2013, the Board appointed Mr. Hiren Gada, Whole Time Director of the Company, as the Chief Financial Officer of the Company, designated as 'Whole Time Director - Chief Financial Officer'.

iii) Key Managerial Personnel:

Pursuant to the provisions of Section 203 of Companies Act, 2013, read with Rule 9 of the Companies (Appointment and Remuneration Personnel) Rules 2014, your Company has noted the appointment of the following Whole Time Key Managerial Personnel of the Company in its Board Meeting dated November 11, 2014:

* Mr. Raman Maroo - Managing Director

* Mr. Atul Maru - Jt. Managing Director

* Mr. Hiren Gada - Whole Time Director & CFO

* Mr. Vinod Karani - Vice-President of the Broadcast Syndication and Content Acquisition division.

* Mr. Hemant Karani - Vice-President of the Studio division

* Mr. Bipin Dharod - National Head for Marketing and Sales of the Home Video division

* Mr. Ketan Maru - Head of the Film Production division

* Ms. Smita Maroo - Head of the Animation division

* Mr. Harakhchand Gada - Head of Accounts division

* Ms. Mansi Maroo - Co-producer in the Film division

* Ms. Kranti Gada - Assistant Vice-President in New Media and Technologies division

* Mr. Ankit Singh - Company Secretary & Compliance Officer

iv) Retirement by Rotation:

Pursuant to the provisions of Section 152 of the Companies Act, 2013 and applicable rules thereto, Mr. Atul Maru, Jt. Managing Director of the Company, is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, seeks re-appointment. Your Directors recommend his re-appointment for your approval.

v) Resignation:

Mr. Jayesh Parekh, who was an Independent Director on the Board, has resigned with effect from March 28, 2015, due to time constraints and other pre-occupancies. He served as an Independent Director approximately for a period of 4 years. The Board places on record its deep appreciation for the valuable contributions made by him during his tenure as an Independent Director on the Board of the Company.

vi) Appointment:

The Board recommends the appointment of CA Reeta Bharat Shah, who was appointed as an Additional Director of the Company with effect from March 28, 2015, pursuant to the provisions of Section 161 of the Companies Act, 2013 to hold office till the date of Annual General Meeting and in respect of whom the Company has received a requisite notice in writing from a member proposing CA Reeta Bharat Shah, for appointment as an Independent Director of the Company.

As required under Clause 49 of the Listing Agreement entered with Stock Exchanges, the information including brief profile(s) of the Directors proposed for appointment and re-appointment are mentioned at length in the Notice of ensuing Annual General Meeting.

vii) Declarations:

The Company has received declarations from all the Independent Directors of the Company under sub-section (7) of Section 149 confirming that they meet with the criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement entered with the Stock Exchanges, as amended.

viii) Board performance evaluation:

Pursuant to Clause 49 of the Listing Agreement and the Companies Act, 2013 the Company has formulated Nomination and Remuneration Policy for the purpose of performance evaluation of Independent Directors, Board, Committees and other individual directors which includes criteria for performance evaluation of the non-executive directors and executive directors.

The Nomination and Remuneration Committee has evaluated the annual performance of the Board and that of its committees, individual directors, Chairman and Independent Directors, and the same has been approved and considered by the Board in its meeting.

ix) Familiarization of Independent Directors:

Your Company has put in place a structured induction and familiarization programme for the Independent Directors. The Company through such programme familiarizes the Independent Director, with a brief background of the Company, nature of the industry in which it operates, its business model, operations and makes the Independent Directors aware about their roles, responsibilities and liabilities as per Companies Act, 2013 and other applicable laws.

The familiarization programme for Independent Directors has been detailed in Corporate Governance which forms part of the Annual Report.

The familiarization programme for Independent Directors in terms of provisions of Clause 49 of the Listing Agreement is uploaded on the website of the Company and can be accessed through the following link: http:// www.shemarooent.com/?p=Code of Conduct.

Public Deposits

During the Financial year 2014-2015, your Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

Credit Rating

During the year under review, the rating agencies re-affirmed / issued the below ratings to the Company:

Nature of Instrument Rating Long Term Bank Facility CRISIL A-/Stable Long Term Bank Facility CARE A-(Single A Minus)

Auditors and Auditors Report

* Statutory Auditors:

In accordance with the provisions of the Companies Act, 2013, M/s. M. K. Dandeker & Co., Chartered Accountants (Firm Registration No. 000679S) were re-appointed as the Statutory Auditors of the Company to hold office from the conclusion of the 9th Annual General Meeting (AGM) upto the conclusion of the 11th AGM of the Company to be held in the year 2016 (subject to ratification of their appointment by the Members at every AGM held after the 9th AGM).

As required under the provisions of section 139(1) of the Companies Act, 2013, the Company has received a written consent from M/s. M. K. Dandeker & Co., Chartered Accountants to their appointment and a Certificate, to the effect that their appointment, if made, would be in accordance with the Companies Act, 2013 and the Rules framed thereunder and that they satisfy the criteria provided in section 141 of the Companies Act, 2013.

The Members are requested to ratify the appointment of the Statutory Auditors as aforesaid and to authorize the Board to fix their remuneration.

The Statutory Audit Report does not contain any qualification, reservation or adverse remark and forms part of the Annual Report.

* Secretarial Auditors:

M/s. Manish Ghia & Associates, Practicing Company Secretary (Membership no. FCS 6252 and Certificate of Practice no. 3531) has conducted Secretarial Audit, pursuant to the provisions of Section 204 of the Companies Act, 2013, for the financial year 2014-15. M/s. Manish Ghia & Associates has submitted the Report confirming compliance with the applicable provisions of Companies Act, 2013 and other rules and regulations issued by SEBI and other regulatory authorities. There was no qualifications, reservations or adverse remarks made by the Practicing Company Secretary in their report.

Directors Responsibility Statement

Pursuant to the requirement under Section 134(3)(c) of the Companies Act, 2013 with respect to Directors Responsibility Statement, the Directors hereby confirm that:

1. in the preparation of the Annual Accounts for the year ended March 31, 2015, the applicable Accounting Standards have been and that no material departures have been made from the same.

2. the Directors have selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the year ended March 31, 2015 and of the profit of the Company for that period;

3. the Directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. that the Directors have prepared the Annual Accounts for the year ended March 31,2015 on a going concern basis;

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

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

Annual Return

Pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the extract of Annual Return is given in Annexure 'A' which forms part of Annual Report.

Contracts / Arrangements with Related Parties

All contracts and arrangements with related parties under Section 188(1) of the Act, entered by the Company during the financial year, were in the ordinary course of business and on an arm's length basis. No Material Related Party Transactions were entered during the year by your Company. Accordingly, the disclosure of Related Party Transactions to be provided under section 134(3) (h) of the Companies Act, 2013, in Form AOC - 2 is not applicable.

All Related Party Transactions are placed before the Audit Committee for approval. An omnibus approval of the Audit Committee is obtained for related party transactions which are repetitive in nature. The Audit Committee reviews all transactions entered into pursuant to the omnibus approval(s) so granted on a quarterly basis.

The policy on Related Party Transactions as approved by the Board is uploaded on the Company's website and can be accessed at the Web link: http://www.shemarooent. com/?p=Code of Conduct.

Particulars of Loans Guarantees or Investments made under section 186 of the Companies Act 2013

Details of Loans, Guarantees or Investments made under Section 186(4) of the Companies Act, 2013 read with Clause 32 of the Listing Agreement are as follows:

A. Loans given

(Rs. in lacs)

Sr. Particulars 2014-15 2013-14

1. Wholly Owned Subsidiary 260.76 48.22

2. Inter Corporate Deposits/Others 524.00 599.65

Notes:

1. All loans given to unrelated corporate entities / others at an interest ranging from 9% to 18%.

2. All loans are short term in nature.

3. All the loans are provided for business purposes of respective entities, repayable on demand with prepayment option to the borrower.

B. Investments made

There are no investments by the Company other than those stated under Note 2.11 in the Financial Statements.

C. Guarantees given

There are no guarantees given during the year.

D. Securities given

There are no securities given during the year.

Whistle Blower Policy / Vigil Mechanism

Your Company has adopted Whistle Blower Policy / Vigil Mechanism to comply with the regulatory requirements and to provide a framework to promote responsible and secure whistle blowing. This policy helps to protects employees wishing to raise a concern about serious irregularities within the Company. This mechanism provides for adequate safeguards against victimization of persons who use such mechanism.

The policy on Whistle Blower Policy / Vigil Mechanism as approved by the Board is placed on the company's website http://www.shemarooent.com/?p=Code of Conduct.

Composition of an Audit Committee

Your Company has originally constituted Audit Committee at the Board meeting held on August 29, 2011, ("Audit Committee"). Further it was re-constituted by the Board at its meeting held on May 29, 2014.

The Audit Committee comprises of the following members:

Name of Member Designation Nature of Directorship

Mr. Gnanesh Gala Chairman Independent Director

Mr. Kirit Gala Member Independent Director

Mr. Hiren Gada Member Executive Director

The detailed scope and functions are given in the Corporate Governance Report.

Risk Management Policy

Pursuant to the provisions of Section 134 of the Companies Act, 2013, your Company has adopted the policy and procedures with regard to risk management. The Company has laid down the framework to identify risks inherent in any business operations of the Company and provides guidelines to define, measure, report, control and mitigate the identified risks. This Policy ensures the sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating and resolving risks associated with the Company's business.

In terms of Clause 49 of the Listing Agreement, the Constitution of Risk Management Committee was not applicable during the financial year 2014-2015.

Sexual Harassment Policy

The Company has in place policy on Sexual Harassment in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. All employees are covered under this policy. Your Company has constituted Complaints Committee to redress complaints received regarding sexual harassment. During the year under review, no complaints were received in this regards.

Internal Control System and Compliance Framework

The Company has an Internal Control System, commensurate with size, scale and its operations. The Internal Financial controls are adequate and are operating effectively so as to ensure orderly and efficient conduct of business operations.

In regards to the aforesaid, your company has appointed M/s. Mahajan & Aibara as Internal Auditors of the Company. The Internal Auditors carry out audit, covering inter alia, monitoring and evaluating the adequacy of internal control systems in the company, its compliance with operating systems, accounting procedures and policies and submit their periodical internal audit reports to the Audit Committee. Based on the Internal Audit report and review of the Audit Committee, your company undertakes necessary actions in their respective areas. The Board has also put in place requisite legal compliance framework to ensure compliance of all the applicable laws and that such systems are adequate and operating efficiently.

Managerial Remuneration and Particulars of Employees

The information required pursuant to the provisions of Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is appended as Annexure 'B' and forms part to the Director's report of this Annual 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, no employees were in receipt of remuneration of Rs. 60 lacs or more per annum and Rs. 5 lacs or more per month. Hence, no separate disclosure is made by the Company in this regard.

Your Company has paid the remuneration to all the Directors / Key Managerial Personnel's / Employees as per the Nomination and Remuneration Policy.

Corporate Governance

Your Company is committed to maintain the highest standards of corporate governance, the internal governance policies are well documented and the Company has put in place a formalised system of Corporate Governance setting out the structure, processes and practices of governance within the Company.

The Report on corporate governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report.

The requisite certificate from the Practicing Company Secretaries confirming compliance with the conditions of corporate governance as stipulated under the aforesaid Clause 49 is attached to the Report on corporate governance.

Significant and material Orders passed by the Regulators/ Courts, if any

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of your Company and its future operations.

Conservation of Energy, Technology Absorption and Foreign Exchange

Your Company consumes power to the extent required in administrative functions. Considering Company's business activities, information required under Section 134(3)(m) of the Companies Act,2013, read with the Companies (Disclosure of Particulars in the Directors Report) Rules, is not applicable to the Company.

1. Conservation of Energy

Your Company, being a service provider, requires minimal energy consumption and every endeavour is made to ensure optimal use of energy, avoid wastages and conserve energy as far as possible.

The operations of the Company are not energy-intensive. The Company constantly evaluates and invests in new technology to make its infrastructure more energy efficient and also under cost reduction.Following energy conservation measures were taken during the year under review:

* Administration keep a regular check on whether the Computer systems provided to the employees have been shut down properly at the time of closure of office etc.

* Optimization of lighting by replacing tube lights with CFLs / LED.

Further, since energy costs comprise a very small part of your Company's total expenses, the financial implications of these measures are not material.

2. Technology Absorption

The sector in which the Company is engaged does not involve any specialized or innovative use of technology. The Company's technological initiatives are mainly used in Studio functions of the Company which uses latest state of art technology. The Company is an established Filmed Entertainment "Content House" and considering our business there is limited scope of technology absorption, adaptation and innovation. However, the Company believes that only progressive research and development will help to measure up to future challenges and opportunities. During the year under review, expenditure on research and development is not significant in relation to the nature size of operations of your Company.

3. Foreign Exchange Earnings & Outgo

Details of foreign exchange earnings and outgo during the year are given in Note 2.28 and 2.30 of the Financial Statements forming part of Annual Report.

Human Resources

Human Resources are of paramount importance for the sustenance and growth of any industry. Being in the business of creativity, to ensure sustainable business growth, over the years your Company has been focusing on strengthening its talent management. The Company has always valued its employees. The HR department is geared towards ensuring recruitment, retention and development of the best talent in the industry with focus to contribute, strive towards excellence continuously. Your company continues to give maximum thrust to its Human Resources Development.

The HR department are reviewing the Individual performance(s) on Quarterly basis. The performance(s) are measured through Key Result Areas which provide an opportunity for employees to stretch themselves and contribute to the overall success of organization. Human Resource Policies and Practices are regularly reviewed and revised to suit the employees and organization needs.

The Company practices various interactive sessions on Team Building, Motivation and Stress Management to keep the employees motivated and improve their work style. The total employee strength at the end of financial year 2014-15 is 340.

Your Directors wish to place on record their appreciation for the sincere and devoted efforts of the employees at all levels.

Corporate Social Responsibility - Social Commitments

As per the provisions of Companies Act, 2013, all companies having a net worth of Rs. 500 crore or more, or turnover of Rs. 1000 crore or more or a net profit of Rs. 5 crore or more during any financial year is required to constitute a Corporate Social Responsibility (CSR) Committee of the Board comprising 3 or more directors, at least one of whom shall be an Independent Director.

Pursuant to the provisions of Section 135 of the Companies Act, 2013, Corporate Social Responsibility Committee (CSR) has been constituted. The said Committee has adopted a CSR Policy with primary focus on Rural Transformation, Health care, Environment, Education and Culture, besides these focus areas, your company shall also undertake the CSR activities listed in Schedule VII of the Companies Act, 2013. The Committee shall monitor the CSR Policy and implement the same from time to time.

Past from many years before the Corporate Social Responsibility (CSR) had become mandatory responsibility of the corporates, your Company has engaged in such activities for decades for improving the living standards of economically weaker section of the society. Your Company has been striving to achieve a fine balance between economic and social imperatives, while also paying attention to the needs and expectations of our internal as well as external stakeholders. Our Corporate Social Responsibility is not limited to Philanthropy, but encompasses holistic community development. Your Company is striving to fulfil its social responsibilities through donations in trusts and helping them in accomplishment of their social activities along with taking initiatives for the societies / schools which are formed for disabled persons. Accordingly, your Company spent Rs. 56.69 Lacs towards CSR activities in FY 2014-2015. Implementation of some of the CSR activities did not commence before end of the financial year. The contents of the CSR policy and initiatives taken by the Company on Corporate Social Responsibility during the year 2014-15 is attached as Annexure 'C' to this Report and contents of the CSR policy is available on our website at http://www. shemarooent.com/?p=Code of Conduct.

Cautionary Statement

Statements in the Annual Report, particularly those which relate to Management Discussion and Analysis, describing the Company's objectives, projections, estimates and expectations,may constitute 'forward looking statements' within the meaning of applicable laws and regulations. Although the expectations are based on reasonable assumptions, the actual results might differ substantially or materially from those expressed or implied. Important developments that could affect the Company's operations includes but not limited to changes in exchange rate fluctuations, tax laws, litigation, labour relations, interest costs, political and economic environment.

Acknowledgement

Your Directors take this opportunity to express their sincere appreciation for the continued assistance and co-operation received from customers, shareholders, suppliers, bankers, business partners / associates, financial institutions and Central and State Governments / regulatory authorities viz. the Ministry of Information & Broadcasting, Ministry of Corporate Affairs, Reserve Bank of India, Securities and Exchange Board of India, Stock Exchanges, Depositories and other stakeholders for their consistent support and encouragement to the Company.

Your Directors recognize and appreciate the hard work and commitment of all the employees of the Company and its subsidiaries. Their dedication and competence has ensured that the Company continues to remain in the forefront of Media and Entertainment business.

For and on behalf of the Board of Directors

Raman Maroo Atul Maru (DIN: 00169152) (DIN: 00169264) Managing Director Jt. Managing Director

Mumbai July 30, 2015




Mar 31, 2014

Dear Members,

We are delighted to present the 9th Annual Report on our business and operations for the year ended March 31, 2014.

PERFORMACE HIGHLIGHTS (Standalone): (Rs. In Lakhs)

Review of Operations Current year Previous year 2013-2014 2012-2013

Income:

Sales & Services 26,334 21,332

Other Income 134 135

Total Income 26,468 21,467

Direct Operational Expenses 21,668 17,615

Changes in inventories of fnished goods, work-in-progress and Stock-in-Trade (5,154) (4,955)

Employee benefit expense 1,794 1,594

Financial Costs 1,923 1,831

Depreciation and amortization expense 296 298

Other expenses 1,512 1,340

Total expenditure 22,039 17,725

Profit Before Taxation 4,430 3,744

Tax Expenses

Current Tax 1,294 1,255

Previous year 11 -

Deferred Tax 340 21

Profit After Taxation 2,785 2,468

Balance brought forward from previous years 7,079 4,788

Profit available for Appropriation 9,863 7,257

Less: Appropriations

General Reserve (70) (62)

Proposed Dividend (99) (99)

Dividend Distribution Tax (17) (17)

Balance carried to the Balance Sheet 9,677 7,079

During the year under review, the Standalone Revenue from Operations & Other Income increased to Rs.26,334 Lacs as against Rs.21,332 Lacs in the previous year and the Consolidated Revenue from Operations & Other Income increased to Rs.26,595 Lacs as compared to Rs.21,609 Lacs in the previous year.

Your Company had a standalone growth with a Net Profit after tax of Rs.2,784 Lacs as compared to the Net Profit after tax of Rs.2,468 Lacs in the previous fnancial year and a consolidated growth with a Net Profit after tax of Rs.2,716 Lacs as compared to the Net Profit after tax of Rs.2,355 Lacs in the previous fnancial year.

Dividend

The Board is pleased to recommend an equity dividend of Rs.0.50 per equity share of face value of Rs.10 each for the year ended March 31, 2014.

The dividend is subject to the approval of members at the ensuing Annual General Meeting and shall be paid to the members whose names appear in the register of members as on the close of business hours on the Record date.

Total amount of cash outflow on account of dividend payment recommended for the current year, including dividend distribution tax, will be Rs.116.11 Lacs.

Appropriations - Transfer to General Reserve

We propose to transfer Rs.70 Lacs to the general reserve. An amount of Rs.2,854 Lacs is proposed to be retained in the statement of Profit and loss.

Directorate

Retirement by rotation:

In accordance with the provisions of the Companies Act, 2013, Mr. Raman Maroo, Managing Director of the Company, will retire at the ensuing Annual General Meeting and being eligible, seek reappointment.

The Board recommend his appointment. A brief resume of the aforesaid Director and other information have been detailed in the Notice and the Corporate Governance Report forming part of this Annual Report.

Re-appointments:

In accordance with the provisions of the Companies Act, 1956, the Company had appointed Mr. Jayesh Parekh, Mr. Vasanji Mamania, Mr. Gnanesh Gala, Mr. Kirit Gala and Mr. Shashidhar Sinha as Independent Directors on the Board of our Company on August 29, 2011.

Pursuant to the provisions of section 149 of the Act and any other applicable provisions of the Companies Act, 2013 with respect to the Independent Directors which came in to effect from April 1, 2014, the Board of directors decided to adopt the provisions with respect to appointment and tenure of Independent Directors which is consistent with the provisions of the Companies Act, 2013 and the amended Listing Agreement (proposed to be entered).

Accordingly, the Board in its meeting dated April 26, 2014, subsequently approved by the shareholders in its meeting dated May 26, 2014, re-appointed Mr. Jayesh Parekh, Mr. Vasanji Mamania, Mr. Gnanesh Gala, Mr. Kirit Gala and Mr. Shashidhar Sinha, as Independent Directors of the Company, whose term of Office shall not be subject to retirement by rotation for a term of 5 (five) years up to May 25, 2019.

Chief Financial Officer (CFO):

Pursuant to the provisions of Section 203 of Companies Act, 2013, the Company was required to appoint a whole-time key managerial personnel as the Chief Financial Officer of the Company.

Accordingly, keeping in view the compliance of the provisions of the Companies Act, 2013, the Board appointed Mr. Hiren Gada, Whole–time Director of the Company, as the Chief Financial Officer of the Company, designated as ''Whole Time Director – Chief Financial Officer''.

Proposed Initial Public Offering of Equity Shares by the Company

Your Company has set to launch an Initial public offering of its equity shares and unlock its enterprise value and share its growth plan with the public. The proceeds from the issue would be utilised to fund working capital requirements and general corporate purposes. This event shall result into enhancement of the valuation of the Company and increase the capital. The Company has received the fnal observation letter from SEBI in this regards.

We believe that the proposed IPO shall be a milestone in the company''s corporate history and shall ultimately help to enhance its all stakeholder''s wealth.

Public Deposits:

The Company has accepted public deposits to the tune of Rs.3350 lacs during the fnancial year under review in accordance with section 58A of the Companies Act, 1956 read with Companies (Acceptance of Deposits) Rules, 1975.

Shares

88.26% of the Company''s paid-up Equity Share Capital has been dematerialised and the balance of 11.74% is in physical form as on March 31, 2014. The Company''s Registrar''s are Link Intime India Private Limited.

Auditors and Auditors'' Report

M/s. M. K. Dandeker & Co., Chartered Accountants (Firm Registration No. 000679S), Statutory Auditors of the Company, holds Office until the conclusion of the ensuing Annual General Meeting. In accordance with the provisions of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, it is proposed to re-appoint the Statutory Auditors of the Company for a period of two consecutive years commencing from the conclusion of this forthcoming Annual General Meeting, until the conclusion of the 11th Annual General Meeting of the Company in the year 2016, subject to the ratifcation of their appointment at every subsequent Annual General Meetings.

The Report of Auditors read together with notes to accounts for the relevant fnancial year are self-explanatory and require no comments of the Board.

Subsidiary Companies

As on March 31, 2014 the company have 2 (two) foreign wholly owned subsidiary companies, namely, Shemaroo Entertainment INC (USA) and Shemaroo Entertainment (UK) Private Limited, and 1 (one) India wholly owned subsidiary company, Shemaroo Films Private Limited.

Pursuant to the approval granted by the Ministry of Corporate Affairs vide Circular No. 02/2011 dated February 08, 2011, copies of the Balance Sheet, Profit and Loss Account, and Report of the Board of Directors and the Auditors of the Subsidiary Companies are not being attached to the Balance Sheet of the Company. The fnancial information of the subsidiary companies as required by the aforesaid circular is disclosed under the heading ''Financial Details of Subsidiary Companies'' which forms part of the Annual Report.

The Company will make available hard copies of the Annual Accounts of the subsidiary companies and related detailed information to the members of the Company/Subsidiaries seeking the same.

Consolidated Financials

Consolidated Financial Statements in accordance with Accounting Standard-21 issued by the Institute of Chartered Accountants of India have been provided in the Annual Report. These Consolidated Financial Statements provide fnancial information about your Company and its Subsidiaries as a single economic entity. The Consolidated Financial Statements form part of this Annual Report.

Directors Responsibility Statement

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

1. that in the preparation of the Annual Accounts for the year ended March 31, 2014, the applicable Accounting Standards have been followed along with proper explanation relating to material departures.

2. that the Directors have selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a fair view of the state of affairs of the Company at the year ended March 31, 2014 and of the Profit / loss of the Company for that period.

3. that the Directors have taken proper and suffcient care to the best of their knowledge and ability 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.

4. that the Directors have prepared the Annual Accounts for the year ended March 31, 2014 on a going concern basis.

Particulars of Employees

During the fnancial year 2013-2014, no employee was paid remuneration more than the limit prescribed under section 217 (2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975, as amended. Hence, no separate disclosure is made by the Company in this regard.

Corporate Governance

Your Company is committed to maintain the highest standards of Corporate Governance and continues to lay a strong emphasis on transparency, accountability and integrity.

The Ministry of Corporate Affairs has made majority of the provisions of the Companies Act, 2013 effective from April 01, 2014. The new act is a positive step towards strengthening corporate governance regime in the country. Your Company is in substantial compliance with the Corporate Governance practices specified under the Companies Act, 2013.

Your Company has proactively adopted provisions related to the Audit Committee, Stakeholders Relationship Committee, Nomination and Remuneration Committee and Corporate Social Responsibility Committee.

Your Company has adopted the Code of conduct for prevention of Insider Trading, Company''s Code of conduct for Board of Directors and Senior Managerial Personnel and Code for Independent Directors.

Your Company has adopted Whistle Blower Policy/ Vigil Mechanism as per the said provisions of Companies Act, 2013 and Listing Agreement proposed to be entered into by the Company.

The Corporate Governance Report along with the Management Discussion and Analysis Report is appended as Annexure ''A'' and ''B'', respectively, with this report.

Conservation of Energy and Technology Absorption and Foreign Exchange

The information under section 217 (i) (e) (read the Companies disclosure of particulars in the report of Board of Directors) Rule, 1988.

1. Conservation of Energy

The requirement for disclosure with respect to conservation of energy, under Form A, is not applicable to the Company for the year under review.

2. Technology Absorption

The company is engaged in trading activities and does not involve any specialized or innovative technology. As such there is nothing to report on Technology Absorption.

3. Foreign Exchange Earnings & Outgo

Details of foreign exchange earnings and outgo is given under Note 29, 30 and 31 to the Financial Statements.

Human Resources

Your Company enjoys cordial relations with its employees. The key focus of your Company is to attract, retain and develop talent. The Board wishes to place on record its appreciation of the contributions made by all employees ensuring high levels of performance and growth during the year.

Corporate Social Responsibility - Social Commitments

Past from many years before the Corporate Social Responsibility (CSR) had become mandatory responsibility of the corporates, your Company has engaged in such activities for decades for improving the living standards of economically weaker section of the society. Your Company has been striving to achieve a fne balance between economic and social imperatives, while also paying attention to the needs and expectations of our internal as well as external stakeholders. Our Corporate Social Responsibility is not limited to Philanthropy, but encompasses holistic community development. Your Company is striving to fulfl its social responsibilities through donations in trusts and helping them in accomplishment of their social activities along with taking initiatives for the societies/schools which are formed for disabled persons.

As per the provisions of Companies Act, 2013, all companies having a net worth of Rs.500 crore or more, or turnover of Rs.1000 crore or more or a net Profit of Rs.5 crore or more during any fnancial year will be required to constitute a Corporate Social Responsibility (CSR) Committee of the Board comprising 3 or more directors, at least one of whom will be an Independent Director.

Pursuant to this, your Company has constituted a Corporate Social Responsibility Committee (CSR) in compliance with the provisions of Section 135 of the Companies Act, 2013. The said Committee shall formulate and recommend to the Board activities to be undertaken by the Company as specified in Schedule VII of the Companies Act, 2013. Along with the amount of expenditure to be incurred on such activities. It shall also monitor the CSR Policy of the Company and its implementation from time to time.

Acknowledgement

Your Directors would like to express their sincere appreciation for the continued assistance and co-operation received from shareholders, bankers, employees, regulatory bodies and other Business constituents.

For and on behalf of the Board of Directors

Raman Maroo Atul Maru Managing Director Jt. Managing Director

Mumbai May 29, 2014


Mar 31, 2013

Dear Members,

The Directors present the 8th Annual Report on the business and operations of the Company together with the Audited Financial Accounts for the year ended March 31, 2013.

FINANCIAL RESULTS: (Rs. in Lakhs) Current year Previous year 2012-2013 2011-12

Sales & Services 21,332 18,051

Other Income 135 510

Total Income 21,467 18,562

Expenditure:

Direct Operational Expenses 17,615 14,889

Changes in inventories of finished goods, work-in-progress and Stock-in-Trade (4,966) (4,379)

Employee benefit expense 1,606 1,434

Financial Costs 1,836 1,926

Depreciation and amortization expense 2,989 294

Other expenses 1,335 1,494

Total expenditure 17,725 15,658

Profit Before Taxation 3,742 2,904

Tax Expenses

Current year 1,255 938

Less: MAT Credit - (199)

Previous year - 26

Deferred Tax 18 37

Profit After Taxation 2,470 2,102

Balance brought forward from previous years 4,788 2,854

Transferred from Capital Reserve on Demerger - -

Profit available for Appropriation 7,258 4,956

Less: Appropriations

General Reserve (62) (53)

Proposed Dividend (99) (99)

Dividend Distribution Tax (17) (16)

Balance carried to the Balance Sheet 7,080 4,788

Standalone Financials:

During the year under review, the Sales & Other Income increased to Rs. 21,332 lacs as againstRs. 18,052 lacs in the previous year. The Company had a growth with a Net Profit after taxation of Rs. 2,470 lacs as compared to the Net Profit after tax of Rs. 2,102 lacs in the previous financial year.

Dividend

The directors recommend for consideration of the shareholders at the ensuing annual general meeting, payment of a dividend of Rs. 0.5 per share (5 per cent) for the year ended March 31, 2013.

The amount of dividend recommended is Rs. 99.24 lacs.

TRANSFER TO GENERAL RESERVE

Your Company proposes to transfer Rs. 62 lacs to the general reserve. An amount of Rs. 2,531 lacs is proposed to be retained in the statement of profit and loss.

Directors

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, Mr. Gnanesh Dungarshi Gala and Mr. Kirit Vishanji Gala, Directors of the Company, retire by rotation at the ensuing Annual General Meeting.

Mr. Gnanesh Dungarshi Gala and Mr. Kirit Vishanji Gala being eligible for re-appointment, seek re-appointment at the ensuing Annual General Meeting. Appropriate resolutions for their re-appointment shall be placed before you for your approval at the ensuing Annual General Meeting. The brief resume of the aforesaid Directors and other information have been detailed in the Notice and the Corporate Governance Report.

None of Directors of the Company are disqualified under section 274(1) (g) of the Companies Act, 1956.Your Directors recommend their re-appointment as Directors of your Company.

Proposed initial public offering of equity shares by the company:

Your Company is planning to unlock its enterprise value and share its growth plan with public by coming up with an

Initial Public Offering (IPO) of its Equity Shares.

The Proposed Initial Public Offering has been authorised by a resolution of our Board dated February 23, 2013, and by a special resolution passed pursuant to Section 81 (1 A) of the Companies Act, at the EGM held on April 11, 2013.

The Company is preparing to file Draft Red Herring Prospectus (DRHP) with the Securities Exchange Board of India (SEBI).

Your Directors believe that the proposed IPO shall be a milestone in the company''s corporate history and shall ultimately help to enhance its all stakeholder''s wealth.

''Shemaroo'' celebrates its golden jublee in entertainment industry:

The Board has immense pleasure to inform you that On October 29, 2012 "Shemaroo" brand completed its 50th year of existence and has made the history of flawless reputation, glowing image and strong goodwill of over 50 years. ''Shemaroo'' which was founded on October 29, 1962, in Mumbai, as a book circulating library today is an integrated media content house in India with activities across content acquisition, value addition to content and content distribution. The Company believes that over the years the "Shemaroo" brand has high consumer recall as being associated with quality entertainment.

PUBLIC DEPOSITS

The Company has accepted public deposits to the tune of Rs. 2,644 lacs during the financial year under review in accordance with section 58A of the Companies Act, 1956 read with Companies (Acceptance of Deposits) Rules, 1975.

Auditors and Auditors'' Report

M/s. M K Dandeker & Co., Registration No. 000679S, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting. It is proposed to re-appoint them to examine and audit the accounts of the Company for the financial year 2013-2014. M/s. M K Dandeker & Co., have under section 224 (1B) of the Companies Act, 1956, furnished a certificate of their

eligibility for re-appointment that they are not disqualified for such appointment within the meaning of section 226 of the Companies Act, 1956.

The observations and comments given by the auditors in their Audit Report for the relevant financial year read together with notes to accounts are self-explanatory and hence do not require any further comments under section 217 of the Companies Act, 1956.

Subsidiary Companies

Your company has incorporated a wholly-owned subsidiary Company named Shemaroo Films Private Limited ("SFPL") as a private Company registered under the Companies Act, 1956 on October 31, 2012. The Registered office of the wholly owned subsidiary company is situated at Shemaroo House, Plot No-18, Marol Co- operative, Ind. Estate, off. Andheri Kurla Road, Andheri East, Mumbai-59. Its corporate identification number is U22130MH2012PTC237345.The aforesaid Company is engaged in the business of creation, aggregation and distribution of the content on various mediums like Television, Home video, Mobile, IPTV, etc. across various markets within India and Overseas and providing transfer related technical services.

Mr. Raman Maroo, Mr. Atul Maru, Mr. Hiren Gada and Mr. Jai Maroo, Directors of the Company, have been appointed as the First Directors on the Board of the Subsidiary Company.

As on 31st March, 2013 the company have 2(two)foreign wholly owned subsidiary companies, namely, Shemaroo Entertainment INC (US), Shemaroo Entertainment (UK) Private Limited andl(One) India wholly owned subsidiary company, namely, Shemaroo Films Private Limited.

Pursuant to the approval granted by the Ministry of Corporate Affairs vide Circular No. 02/2011 dated February 8, 2011, copies of the Balance Sheet, Profit and Loss Account, and Report of the Board of Directors and the Auditors of the Subsidiary Companies are not being attached to the Balance Sheet of the Company. The financial information of the subsidiary companies as required by the aforesaid circular is disclosed under the

heading ''Financial Details of Subsidiary Companies'' which forms part of the Annual Report.

The Company will make available hard copies of the Annual Accounts of the subsidiary companies and related detailed information to the members of the Company/ Subsidiaries seeking the same.

Consolidated Financials

Consolidated Financial Statements in accordance with Accounting Standard-21 issued by the Institute of Chartered Accountants of India have been provided in the Annual Report. These Consolidated Financial Statements provide financial information about your Company and its Subsidiaries as a single economic entity. The Consolidated Financial Statements form part of this Annual Report.

Directors Responsibility Statement:

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

1. that in the preparation of the Annual Accounts for the year ended March 31, 2013, the applicable Accounting Standards have been followed along with proper explanation relating to material departures.

2. that the Directors have selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a fair view of the state of affairs of the Company at the year ended March 31, 2013 and of the profit / loss of the Company for that period.

3. that the Directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. that the Directors have prepared the Annual Accounts for the year ended March 31, 2013 on a going concern basis.

Particulars of Employees

During the financial year 2012-2013, no employee was paid remuneration more than the limit prescribed under section 217 (2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975, as amended . Hence, no separate disclosure is made by the Company in this regard.

Corporate Governance Report:

The Company is committed to maintain the highest standards of Corporate Governance. The Company has implemented several corporate governance practices as prevalent globally. The Corporate Governance Report is appended as Annexure ''A'' with this report.

Management''s Discussion And Analysis:

The Management Discussion and Analysis Report is appended as Annexure ''B'' with this report.

Conservation of Energy and Technology Absorption and Foreign Exchange

The information under section 217 (i) (e) (read the Companies disclosure of particulars in the report of Board of Directors) Rule, 1988.

1. Conservation of Energy

The requirement for disclosure with respect to conservation of energy, under Form A, is not applicable to the Company for the year under review.

2. Technology Absorption

The company is engaged in trading activities and does not involve any specialized or innovative technology. As such there is nothing to report on Technology Absorption.

3. Foreign Exchange Earnings & Outgo

Details of foreign exchange earnings and outgo is given under Note 29, 30 and 31 to the Financial Statements.

Human Resources

Your Company enjoys cordial relations with its employees. The key focus of your Company is to attract, retain and

develop talent. The Board wishes to place on record its appreciation of the contributions made by all employees ensuring high levels of performance and growth during the year.

Social Commitments

Your Company is aware of its social responsibility and has been from time to time contributing to social issues.

Acknowledgment

Your Directors would like to express their sincere appreciation for the assistance and co-operation received from shareholders, bankers, employees, regulatory bodies and other Business constituents during the year under review.

For and on behalf of the Board of Directors

Raman Maroo Atul Maru Managing Director Jt. Managing Director

Mumbai June 12,2013


Mar 31, 2011

Dear Members,

The Directors present the 6thAnnual Report on the business and operations of the Company together with the audited financial accounts for the year ended March 31, 2011. (Rs. in ''000)

Financial Results Current Year Previous Year 2010-11 2009-10

Income:

Sales & Services 15,49,260 10,16,039

Other Income 20,344 20,243

Total Income 15,69,604 10,36,282

Expenditure:

Direct Operational Expenses 10,03,617 642,765

Personnel Expenses 99,148 83,159

Administrative Expenses 93,387 65,421

Financial Expenses 1,53,277 165,032

Selling Expenses 30,847 39,917

Preliminary Expenditure written off - -

Depreciation 27,121 26,815

Total expenditure 14,07,397 1,023,109

Profit Before Taxation 1,62,208 13,172

Provision for Taxation 35,654 238

Excess in provision for taxation in previous years 3,364 -

Profit After Taxation 1,26,554 12,934

Balance brought forward from previous years (44,331) (57,265)

Transferred from Capital Reserve on Demerger 2,19,963 -

Profit available for Appropriation 3,05,549 (44,331)

Less: Appropriations

General Reserve 9,492 -

Proposed Dividend 9,114 -

Dividend Distribution Tax 1,514 -

Balance carried to the Balance Sheet 2,85,429 (44,331)

Review of Operation

During the year under review, the Sales & Other Income increased to Rs. 15,49,260 thousandas against Rs. 10,16,039 thousand in the previous year. The Company had a turnaround with a Net Profit After taxation of Rs. 1,29,917 thousandas compared to the Net Profit after tax of Rs. 12,934 thousand in the previous financial year.

Dividend

The directors recommend for consideration of the shareholders atthe ensuing annual general meeting, payment of a dividend of Rs. 2 per share (20 per cent) for the year ended March 31, 2011.

The amount of dividend recommended is Rs. 9,114 thousand.

Conversion into a Public Limited Company

Pursuant to the special resolution of our members dated March 26, 2011, our Company was converted to a Public Limited Company and a fresh certificate of incorporation consequent to the change of status was granted on April 1, 2011, by the Registrar of Companies, Maharashtra, Mumbai.

Issue And Allotment of Bonus Shares

Pursuant to approval of the members in their meeting dated March 26, 2011, the Company issued and allotted 41,01,372 equity shares of Rs. 10/- (Rupees Ten) each aggregating to Rs. 4,10,13,720 (Rupees Four Crore Ten Lac Thirteen Thousand Seven Hundred and Twenty Only) as bonus shares credited as fully paid up by capitalisation of the sum standing to the credit of the Capital Reserve Account to all members of the Company holding equity shares of the company at the close of business hours on March 26, 2011, being the Record Date, in the ratio of Nine new fully paid-up equity shares of Rs. 10/- (Rupees Ten) each for One fully paid up equity shares of Rs. 10/- (Rupees Ten) each held.

Directors

In terms of the provisions of the Companies Act, 1956, Shri Buddhichand H. Maroo, Director of the Company, retire by rotation and being eligible, offers himself for re-appointment at the ensuing Annual General Meeting.

During the period under review, Shri Raman H. Maroo and Shri Atul H. Maru were re-appointed as Managing Director and Joint Managing Director, respectively, for a period of five years w.e.f. January 1, 2011. Shri Hiren U. Gada was appointed as a Whole Time Director, for a period of five years w.e.f. January 1,2011.

Public Deposits

The Company has not accepted any Public Deposit during the financial year under review.

Auditors and Auditors'' K Report

M/s. Gawande & Associates, Chartered

Accountants, Statutory Auditors of the Company, who holds office till the conclusion of the ensuing Annual General Meeting has, due to pre- occupation in other assignments, shown their unwillingness to continue as Statutory Auditors of the Company for the financial year 2011-2012.

Pursuant to this the Company has offered M/s M K Dandeker & Co., Chartered Accountants, Chennai, for appointing them as the Statutory Auditors of the Companyforthe financial year 2011-2012. The Company has also received letter from M/s M K Dandeker & Co., Chartered Accountants accepting the offer and to the effect that their appointment, if made, would be within the limits specified u/s 224 (1B) of the Companies Act, 1956 and that they are not disqualified for such appointment within the meaning of section 226 of the Companies Act, 1956.

The observations and comments given by the auditors in their report read together with notes to accounts are self- explanatory and hence do not require any further comments under section 217 of the Companies Act, 1956.

Subsidiary Companies

As on 31st March, 2011 the company have two subsidiary companies namely Shemaroo Entertainment INC (US) and

Shemaroo Entertainment (UK) Private Limited.

Pursuant to the approval granted by the Ministry of Corporate Affairs vide Circular No. 02/2011 dated February 8, 2011, copies of the Balance Sheet, Profit and Loss Account, and Report of the Board of Directors and the Auditors of the Subsidiary Companies are not being attached to the Balance Sheet of the Company. The financial information of the subsidiary companies as required by the aforesaid circular is disclosed under the heading ''Financial Details of Subsidiary Companies'' which forms part of the Annual Report.

The Company will make available hard copies of the Annual Accounts of the subsidiary companies and related detailed information to the members of the Company/Subsidiaries seeking the same.

Directors Responsibility Statement

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

1 that in the preparation of the Annual Accounts for the year ended March 31, 2011, the applicable Accounting Standards have been followed along with proper explanation relating to material departures.

2 that the Directors have selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a fair view of the state of affairs of the Company at the year ended March 31, 2011 and of the profit / loss of the Company for that period.

3 that the Directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4 that the Directors have prepared the Annual Accounts for the year ended March 31, 2011 on a going concern basis.

Particulars of Employees

No employee was paid remuneration more than the limit prescribed under section 217 (2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) AmendmentRules, 2011.

Consolidated Financials

As required by Accounting Standard-21 on Consolidation of Financial Statements, Consolidated Financial Statements and Cash Flow Statement are appended.

Conservation of Energy and Technology Absorption and Foreign Exchange

The information under section 217 (i) (e) (read the Companies disclosure of particulars in the report of Board of Directors) Rule, 1988

1 CONSERVATION OF ENERGY

The requirement for disclosure with respect to conservation of energy, under Form A, is not applicable to the Company for the year under review.

2 TECHNOLOGY ABSORPTION

The company is engaged in trading activities and does not involve any specialized or innovative technology. As such there is nothing to report on Technology Absorption.

3 FOREIGN EXCHANGE EARNINGS & OUTGO

The information on foreign exchange earnings and outgo is given in the notes forming part of accounts at point Nos. 2(e), 2(f) and 2(g).

Human Resources

Your Company enjoys cordial relations with its employees. The key focus of your Company is to attract, retain and develop talent. The Board wishes to place on record its appreciation of the contributions made by all employees ensuring high levels of performance and growth during the year.

Social Commitments

Your Company is aware of its social responsibility and has been from time to time contributing to social issues.

Acknowledgement

Your Directors would like to express their sincere appreciation for the assistance and co-operation received from shareholders, bankers, employees, regulatory bodies and other Business constituents during the year under review.

For and on behalf of the Board Of Directors

Raman AAaroo Atul AAaru Managing Jt. Managing Director Director

Mumbai June 10, 2011


Mar 31, 2010

Dear Members,

The Directors hereby present the Annual Report on the business and operations of the Company together with the audited financial accounts for the year ended March 31, 2010.

(Rs.in ''000 ) Results Current Previous Year Year 2009-10 2008-09

Income:

Sales & Services 1,016,039 1,033,355

Other Income 20,460 14,453

Total Income 1,036,499 1,047,808

Expenditure:

Direct Operational Expenses 642,765 759,837

Personnel Expenses 83,159 101,786

Administrative Expenses 65,638 64,787

Financial Expenses 165,032 178,452

Selling Expenses 39,917 35,993

Preliminary Expenditure written off - -

Depreciation 26,815 28,628

Total expenditure 1,023,327 1,169,482

Profit Before Taxation 13,172 (121,674)

Provision for Taxation 238 7,877

Profit After Taxation 12,934 (129,551)

Surplus b/fd. (57,265) 65,149

Profit available for Appropriation (44,331) (64,401)

Less: Appropriations

General Reserve - (7,506)

Proposed Dividend - -

Dividend Distribution Tax - -

Short Provision for Taxation of earlier years - 370

Surplus c/fd. (44,331) (57,265)

DIRECTORS

During the year under review there is no change in the composition of the Board of Directors.

REVIEW OF OPERATION

During the year under review, the Sales & Other Income reduced to Rs. 1034.49 Million as compared to the previous years Rs. 1060.21 Million. The Company had a turnaround with a Net Profit After taxation of Rs. 12.93 Million as compared to the Net Loss after tax of Rs. 129.55 Million in the previous financial year.

DIVIDEND

With a view to strengthen the Financial position of the Company and consolidate the resources of the Company, no dividend is proposed.

PUBLIC DEPOSITS

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

AUDITORS AND THEIR APPOINTMENT

The term of our Auditors M/s. Gawande & Associates, Chartered Accountants, expires at conclusion of the Annual General Meeting. A proposal has been received for the reappointment of M/s. Gawande & Associates, Chartered Accountants as the Auditors of the Company until the next Annual General Meeting.

SUBSIDIARY COMPANIES

As on 31st March, 2010 the company have two subsidiary companies namely Shemaroo Entertainment INC (US) and Shemaroo Entertainment (UK) Private Limited. In compliance with the provisions of section 212 of the Companies Act, 1956 a statement of the holding Company’s interest in the subsidiary and the financial statements of these subsidiary companies forms part of this Annual Report as a separate section.

The Financials for the UK Subsidiary Shemaroo Entertainment (UK) Private Limited attached herewith are Unaudited and Provisional, however the same has been approved by the Board of the Directors of the Shemaroo Entertainment (UK) Private Limited as such. The same has been submitted to Auditors for their report.

DIRECTORS RESPONSIBILITY STATEMENT

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

1 that in the preparation of the Annual Accounts for the year ended March 31, 2010, the applicable Accounting Standards have been followed along with proper explanation relating to material departures.

2 that the Directors have selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a fair view of the state of affairs of the Company at the year ended March 31, 2010 and of the profit / loss of the Company for that period.

3 that the Directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4 that the Directors have prepared the Annual Accounts for the year ended March 31, 2010 on a going concern basis.

PARTICULARS OF EMPLOYEES

The particulars of the employees having remuneration more than the limit prescribed under section 217 (2A) of the Companies Act, 1956 read with the rules there under are enclosed as per Annexure "A".

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

The information under section 217 (i) (e) (read the Companies disclosure of particulars in the report of Board of Directors) Rule, 1988

1 CONSERVATION OF ENERGY

The requirement for disclosure with respect to conservation of energy, under Form A, is not applicable to the Company for the year under review.

2 TECHNOLOGY ABSORPTION

The company is engaged in trading activities and does not involve any specialized or innovative technology. As such there is nothing to report on Technology Absorption.

3 FOREIGN EXCHANGE EARNINGS & OUTGO

The information on foreign exchange earnings and outgo is given in the notes forming part of accounts at point Nos. 2(e), 2(f) and 2(g).

SECRETARIAL COMPLIANCE CERTIFICATE

Pursuant to Section 383A of the Companies Act 1956 and the rules made there under, your company has obtained the requisite Compliance Certificate from a Company Secretary in whole time practice to the effect that it has complied with the provisions of the Companies Act, 1956 as stated therein. The said Certificate is attached herewith as per Annexure "B".

HUMAN RESOURCES

Your Company enjoys cordial relations with its employees. The key focus of your Company is to attract, retain and develop talent. The Board wishes to place on record its appreciation of the contributions made by all employees ensuring high levels of performance and growth during the year.

SOCIAL COMMITMENTS

Your Company is aware of its social responsibility and has been from time to time contributing to social issues.

ACKNOWLEDGEMENT

Your Directors would like to express the grateful appreciation for the assistance and co-operation received from its Bankers, Employees and Business associates during the year under review.

For and on behalf of the Board of Directors MANAGING DIRECTOR

Place : Mumbai Date : 9th July, 2010

 
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