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Directors Report of Speciality Restaurants Ltd.

Mar 31, 2017

To,

The Members

Speciality Restaurants Limited

The Directors hereby present the Eighteenth Annual Report together with the audited Financial Statements of the Company for the financial year ended March 31, 2017.

1. Financial Results Rs. In Millions

Particulars

Standalone

Consolidated

March 31, 2017

March 31, 2016

March 31, 2017

Revenue from operations

3,124.2

3,213.5

3,151.7

Other Income

52.4

83.0

49.5

Total Income

3,176.6

3,296.5

3,201.2

Earnings before Interest, Depreciation, Amortization and Tax

59.8

254.5

33.8

Less:

Finance Costs

0.2

0.5

0.2

Depreciation /Amortization/Impairment

326.6

283.3

337.3

(Loss) / Profit for the year before Taxes

(267.0)

(29.3)

(303.7)

Less: Taxes Expenses / (credit)

Current Tax

2.4

12.3

2.4

Deferred Tax

(46.5)

(44.2)

(46.5)

Short / (Excess) provision for tax relating to prior years

4.2

-

4.2

(Loss) / Profit for the year

(227.1)

2.6

(263.8)

Add: Balance brought forward from previous year

981.1

978.5

940.0

Available for appropriations

754.0

981.1

676.2

Balance of Profit carried forward to Balance Sheet

754.0

981.1

676.2

2. Financial Performance and the state of Company''s affairs

During the financial year 2016-17, the country experienced two landmark economic reforms even as the global economic scenario was indifferent. Firstly, the goods and services tax (“GST") would become applicable on the supply of goods or services as against the present concept of tax on the manufacture or sale of goods or provision of services. GST, being a destination based consumption tax, would accrue to the states or the union territories where the consumption takes place. It would be a dual GST with the Centre and states simultaneously levying tax on a common tax base. GST will be in effect from July 1, 2017. Secondly, the Reserve Bank of India, by a notification dated November 8, 2016, withdrew Rs. 500 and Rs. 1000 denominations of bank notes, thereby affecting growth in the last quarter.

The Company''s financial performance for the financial year 2016-17 is as under:

(i) Total Income of your Company for the year under review was Rs. 3176.6 million as against Rs. 3,296.5 million in the previous year.

(ii) The earnings before Depreciation, Interest, Tax and Amortization (EBDITA) amounted to Rs. 59.8 (1.88% of the revenue) as against Rs. 254.5 million (7.72% of the revenue) in the previous year.

(iii) The (Loss)/ Profit after Tax was Rs. (227.1) million as against Rs. 2.6 million in the previous year.

(iv) Consolidated revenue during the year was Rs. 3,201.2 million and Consolidated profit/ (loss) for the year was Rs. (263.8) million.

Your Company continued to face a challenging environment during the year under review attributable to reduction in discretionary spends by consumers, demonetization scheme, same store sales growth continued to be in negative territory coupled with lower footfalls during weekdays. The new restaurants opened during the Financial Year 2016-17 had extended breakeven period. Increase in depreciation was due to capitalization of new restaurants and impairment expenditure due to closure of restaurants.

Despite, economic factors continued to pose as headwinds for growth, your Company continues to sustain its strong focus on experimenting with buffet offerings, creating innovative offerings, investing in technology to enhance customer experience, rationalization of menus, renegotiation for reduction in rentals and measures to reduce raw material costs while retaining the footfalls through several innovative measures.

During the year under review, your Company opened two (2) confectionaries and six (6) restaurants out of which three (3) are Company Owned Company Operated (COCO) while three (3) are Franchise Owned Company Operated (FOCO). At the end of Financial Year 2016-17, your Company has 105 Restaurants (including 24 franchisees) and 18 Confectionaries. Your Company continues to pursue development of new restaurants / conversion of existing restaurants in domestic and international market under various brands to achieve sustainable and profitable growth.

3. Dividend on Equity Shares

On account of the Loss after tax reported by the Company during the year under review the Board of Directors did not recommend any dividend for the financial year ended March 31, 2017 (Dividend declared during previous year-Nil).

4. Employee Stock Option Scheme (ESOS)

During the year under review, the Company has not granted any fresh stock option to its employees.

Details of the options granted under Employee Stock Option Scheme (ESOS), as also the disclosures in compliance with Section 62 of the Companies Act, 2013 and Rule 12 of the Companies (Share Capital and Debentures) Rules, 2014, Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 (the "SEBI Guidelines") and SEBI (Share Based Employee Benefits) Regulations, 2014 (the "SEBI Regulations") are given in Annexure A which forms part of this report.

Your Company''s Auditors M/s. Deloitte Haskins and Sells LLP, Chartered Accountants, have certified that the ESOS has been implemented in accordance with the SEBI Guidelines & SEBI Regulations along with the resolution passed by the Members of the Company in this regard.

5. Audited Financial Statements

As per Regulation 34(2) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "Listing Regulations"), Audited Financial Statements (Standalone and Consolidated) for the financial year ended March 31, 2017 i.e. Balance Sheet, Statement of Profit and Loss and a Cash Flow Statement is appended.

6. Subsidiary

Your Company does not have any subsidiary company as on March 31, 2017.

7. Joint Venture

Your Company has a Joint Venture company, Mainland China Restaurant LLC at Doha, Qatar as at March 31, 2017. The Consolidated Financial Statements of your Company and its Joint Venture company, prepared in accordance with the relevant Accounting Standards of the Institute of Chartered Accountants of India, duly audited by the Statutory Auditors, form a part of the Annual Report and are reflected in the Consolidated Accounts.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of Joint Venture company in Form AOC-1 is attached to the Financial Statements of your Company.

8. Awards and Recognition

Your Company''s brand initiatives have been recognized and appreciated across forums. During the year under review your Company has won the following awards:

- Mainland China, Springs Hotel Chennai won the Burrp Award in the category of Best Chinese.

- Mainland China, Doha won the Time Out Award in the category of Highly Commended Best Chinese.

- Mainland China, Malad, Mumbai won the Award of the Best Restaurant at Infiniti Mall.

- Oh! Calcutta, Forum Mall won the Rocheston Award for Distinguished Restaurant.

- Oh! Calcutta, Gurgaon won the Times Food Award in the category of Best Bengali.

- Oh! Calcutta, Bangalore won the Times Food Award in the category of Best Bengali.

- Oh! Calcutta, Silver Springs Kolkata won the Times Food Award in the category of Best Bengali.

- Oh! Calcutta, South Mumbai won the Times Food Award in the category of Best Bengali.

- Sigree Global Grill, Kolkata won the Ahare Bangle Award for the Most Innovative Dish

- Sigree Global Grill, Springs Hotel Chennai won the Burrp Award in the category of Best Buffet.

- Sigree Global Grill, Mumbai won the Times Food Award in the category of Best Multi-Cuisine Buffet in Casual Dining.

- Cafe Mezzuna, Forum Mall Kolkata won the Burrp Award in the category of Best Mediterranean & Best Pizza Award.

- HAKA, Kolkata won the Burrp Award in the category of Best Buffet.

9. Directors and Key Managerial Personnel

I. Directors

Your Company has six (6) Directors of which three (3) are Independent Directors and three (3) are Executive Directors.

II. Independent Directors

In terms of the definition of ''Independent Directors'' as prescribed under Regulation 16(1)(b) of the Listing Regulations and Section 149(6) of the Companies Act, 2013, the Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act, 2013, to the effect that he meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16(1) of the Listing Regulations. The following Non-Executive Directors are Independent Directors of the Company:

1. Mr. Susim Mukul Datta

2. Mr. Dushyant Mehta

3. Mr. Ullal Ravindra Bhat (appointed with effect from April 28, 2017)

III. Woman Director

Mrs. Suchhanda Chatterjee is a Director since incorporation of the Company. Accordingly, the requirements of the provisions of Section 149 of the Companies Act, 2013 and Regulation 17(1) of the Listing Regulations have been complied with by the Company.

IV. Managing Director and Whole-time Directors

Mr. Anjan Chatterjee has been serving as the Managing Director of the Company since December 2007.

Mrs. Suchhanda Chatterjee and Mr. Indranil Chatterjee have been serving as Whole-time Directors of the Company since July 2010.

V. Appointment/Resignation of Director and Key Managerial Personnel

During the year Mr. Jyotin Mehta (DIN: 00033518) Independent Director of your Company resigned from the Board with effect from February 8, 2017. The Board places on record its appreciation for the valuable services rendered and contribution made by Mr. Jyotin Mehta during his tenure as Director of the Company.

Mr. Ullal Ravindra Bhat (DIN: 00008425) was appointed as an Additional Director on the Board of the Company with effect from April 28, 2017 and he holds the office up to the date of forthcoming Annual General Meeting of the Company. Your approval for his appointment as an Independent Director of the Company with effect from April 28, 2017 for the period of five (5) years has been sought in the Notice convening the Annual General Meeting of the Company.

Mr. V. S. Satyamoorthy, Company Secretary and Compliance Officer the Company, retired from the services of the Company with effect from May 24, 2016. The Board places on record its appreciation for the valuable services rendered and contribution made by Mr. V. S. Satyamoorthy during his tenure as Company Secretary of the Company. Mr. Avinash Kinhikar was designated as the Company Secretary & Legal Head of the Company and Compliance Officer of the Company with effect from May 25, 2016.

Mr. Anjan Chatterjee, Managing Director; Mrs. Suchhanda Chatterjee, Whole-time Director; Mr. Indranil Chatterjee, Whole-time Director; Mr Rajesh Kumar Mohta, Executive Director-Finance and CFO and Mr. Avinash Kinhikar, Company Secretary & Legal Head are the Key Managerial Personnel of the Company as per the provisions of the Companies Act, 2013.

VI. Re-appointment of Director Suchhanda Chatterjee (DIN: 00226893)

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mrs. Suchhanda Chatterjee, Whole-time Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible offers herself for re-appointment.

Further details about the Director seeking re-appointment in the ensuing Annual General Meeting are annexed to the Notice which is being sent to the Members along with the Annual Report.

Anjan Chatterjee (DIN: 00200443)

The Board of Directors of the Company at their meeting held on May 27, 2017, subject to the approval of the Members in the ensuing Annual General Meeting of the Company, approved the re-appointment of Mr. Anjan Chatterjee, as Managing Director of the Company for a period of three years with effect from December 27, 2017.

Further details about the Director seeking re-appointment in the ensuing Annual General Meeting are annexed to the Notice which is being sent to the Members alongwith the Annual Report.

VII. Evaluation of Performance of the Directors, Board and Committees of the Board

Pursuant to the applicable provisions of the Companies Act, 2013, the Listing Regulations and SEBI Circular No. SEBI/ HO/CFD/CMD/CIr/p/ 2017/004 dated January 5, 2017 (Guidance Note on Board Evaluation), the Board has carried out an annual evaluation of its own performance, performance of the Directors as well as evaluation of its Committees.

The manner in which the formal annual evaluation of the Directors, Committees of the Board and the Board as a whole is given in the report on Corporate Governance which forms part of the Annual Report.

VIII. Policy on Directors'' remuneration and other details

The Company''s policy relating to remuneration of Directors, Key Managerial Personnel and other Employees as stipulated in Section 178 (3) of the Companies Act, 2013 has been disclosed in the Corporate Governance report, which forms part of the Directors'' report.

IX. Number of Board Meetings

The Board of Directors met six (6) times during the financial year 2016-17. Detailed information on the Meetings of the Board is included in the report on Corporate Governance which forms part of this Annual Report. A separate Meeting of Independent Directors was also held during the financial year 2016-17.

Besides the above, several Committee Meetings of the Board were held during the financial year 2016-17, the detailed information of which is included in the report on Corporate Governance.

X. Share Capital

The Paid-up Equity Share Capital of the Company as on March 31, 2017 was Rs. 46,95,76,570/-. During the year under review, there was no change in the issued, subscribed and paid-up share capital of the Company.

XI. Related Party Transactions

All the related party transactions during the year were entered in the ordinary course of business and on arm''s length basis. There were no materially significant related party transactions entered during the year by your Company. Accordingly, no transactions are being reported in Form No. AOC-2 in terms of Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014.

All Related Party Transactions were presented to the Audit Committee for prior approval and to the Board referred to it by Audit Committee. Omnibus approval was obtained from the Audit Committee of the Company for the related party transactions which are foreseen and repetitive in nature and were reviewed by the Committee on quarterly basis. The Policy on Materiality of Related Party Transactions and also on dealing with Related Party Transactions as approved by the Board is uploaded on the Company''s website at the following web link http://www.speciality.co.in/pdf/policies/POLICY ON MATERIALITY OF RELATED PARTY TRANSACTIONS AND ALSO ON DEALING WITH RELATED PARTY TRANSACTIONS.pdf

The details of the transactions with Related Parties are provided on Page No. 97 under Financial Statements.

10. Report on Corporate Governance

The report on Corporate Governance as stipulated under Regulation 34 (3) read with para C of Schedule V to the Listing Regulations 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 Listing Regulations is attached to this report.

11. Management Discussion and Analysis Report

As stipulated under Regulation 34(2) of the Listing Regulations, Management Discussion and Analysis Report for the financial year under review is provided in a separate section forming part of the Annual Report.

12. Composition of Audit Committee

The details relating to the composition of the Audit Committee are provided in the Report on Corporate Governance which forms part of this report.

13. Corporate Social Responsibility

In terms of Section 135 of the Companies Act, 2013, the Board of Directors of your Company has constituted a Corporate Social Responsibility Committee (“CSR Committee") under the Chairmanship of an Independent Director of the Company. The CSR Committee of the Board has formulated a CSR Policy which has been uploaded on the website of the Company at http://www.speciality.co.in/pdf/policies/CORPORATE SOCIAL RESPONSIBILITY POLICY.pdf

The Annual Report on CSR activities as prescribed under Section 135 of the Companies Act, 2013 is annexed as Annexure B which forms part of this report.

14. Vigil Mechanism

In pursuance of the provisions of Sections 177 (9) and 177 (10) of the Companies Act, 2013, a Vigil Mechanism for Directors and Employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at http://www.speciality.co.in/pdf/policies/VIGIL MECHANISM POLICY.pdf

15. Risk Management

Your Company has constituted a Risk Management Committee on November 12, 2014 for complying with the requirements of the Companies Act, 2013 and Listing Regulations to implement the risk management plan and policy of the Company. This is also in conformity with Regulation 21 of the Listing Regulations.

The Committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The Audit Committee has additional oversight in the areas of internal financial and risk management systems.

16. Particulars of loans, guarantees or investments

Disclosure on particulars relating to loans, guarantees or investments made during the financial year 2016-17 under Section 186 of the Companies Act, 2013 is provided on Page No. 90 under Financial Statements.

17. Consolidated Financial Statement

The Consolidated Financial Statement of the Company and its Joint Venture company, prepared in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Companies Act, 2013 (the Act'') read with Rule 7 of the Companies (Accounts) Rules, 2014, form part of the Annual Report and are reflected in the Consolidated Financial Statement of the Company.

The Company prepared its financial statements in accordance with generally accepted accounting principles in India, including accounting standard read with Section 133 of the Companies Act, 2013 notified under the Companies (Accounting Standard) Rules, 2006. These are Company''s first Consolidated Financial Statement.

The annual financial statement of the Joint Venture company and related detailed information will be kept at the Registered Office of the Company and will be available to investors seeking information.

The consolidated financial statement reflect the operations of the Mainland China Restaurant, LLC, the Joint Venture company, in which your Company has 49% stake.

18. Internal Financial Controls System and their adequacy

Your Company has laid down adequate internal financial controls system, through requisite policies and procedures. Such controls are operating effectively to ensure accuracy and completeness of the accounting records, the timely preparation of reliable financial information along with the orderly and efficient conduct of business.

The Statutory Auditors has expressed an unmodified opinion on the adequacy and operating effectiveness of the Company''s Internal Financial Controls over Financial Reporting in the Annexure A to the Independent Auditor''s Report.

19. Auditors and Audit Reports

I. Statutory Auditors and their report

M/s. Deloitte Haskins and Sells LLP, Statutory Auditors of the Company were appointed at the Fifteenth Annual General Meeting of the Company held on September 15, 2014 to hold office until the conclusion of the Annual General Meeting to be held in the year 2019. As per the provisions of Section 139 of the Companies Act, 2013 the appointment of Statutory Auditors is required to be ratified by the Members at every Annual General Meeting. A resolution for ratification is included in the Notice which is being sent to the Members along with the Annual Report. M/s. Deloitte Haskins and Sells LLP, Statutory Auditors of the Company hold office till the conclusion of the ensuing Annual General Meeting and are eligible for ratification of appointment. They have confirmed their eligibility to the effect that their appointment, if made, would be within the limits prescribed under the Companies Act, 2013 and that they are not disqualified for appointment.

The Notes on Financial Statements referred to in the Auditor''s Report are self-explanatory and do not call for any further comments. The Auditor''s Report does not contain any qualification, reservation or adverse remark.

II. Secretarial Auditor and Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has appointed M/s. GMJ & Associates, a firm of Company Secretaries in Practice, to conduct the Secretarial Audit of your Company for the financial year 2016-17. The Secretarial Audit Report for the financial year 2016-17 is annexed as Annexure C which forms part of this Report.

The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

20. Particulars of Employees

The ratio of remuneration of each director to the median employee''s remuneration and other details in terms of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed as Annexure D which forms part of this report.

The information in respect of employees of the Company required pursuant to Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 will be provided upon request. In terms of Section 136 of the Companies Act, 2013, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the aforesaid Annexure 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 the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.

21. Statutory Disclosures

I. Conservation of Energy, Technology Absorption and Foreign Exchange and Outgo

(i) Conservation of Energy

The disclosures required as per the provisions of Section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 (3) (A) of the Companies (Accounts) Rules, 2014 regarding Conservation of Energy is detailed below:

The Company values the significance of conservation of energy and remain conscious about the environmental impact of its business operations and continuously strives to improve energy efficiency through various initiatives. During the year, the Company undertook a variety of energy conservation measures across all its Restaurants, making continuous efforts for judicious use of energy at all levels of operations by utilizing energy efficient system and processes.

a) The steps taken or impact on conservation of energy

- Installation of energy efficient LED Lights in all restaurants.

- Installation of Energy Management System in 25 restaurants

- Installation of Energy Saving Sensors in the AC System of 25 restaurants.

b) The steps taken by the Company for utilizing alternate sources of energy

The Company has installed 20KW Solar Power Plant at Mainland China Restaurant at Greater Kailash (GK—II) at New Delhi.

c) The capital investment on energy conservation equipments

Rs. in Millions

Particulars of Investment

Amount

Installation of Energy Management System

5.12

Installation of AC Energy Saver System

Investment in power efficient LED Lights in all restaurants

(ii) Technology Absorption

The activities of the Company are not covered under the disclosure required as per the provisions of Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 (3) (B) of the Companies (Accounts) Rules, 2014 regarding technology absorption.

(iii) Foreign Exchange Earnings and Outgo

The disclosure required as per the provisions of Section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 (3) (C) the Companies (Accounts) Rules, 2014 regarding foreign exchange earned in terms of actual inflows and Foreign Exchange outgo during the year under review in terms of actual outflows are given below:

Rs. in Millions

Foreign Exchange Earnings and Outgo

2016-17

2015-16

Foreign Exchange Earned in terms of actual inflows

2.8

3.6

Foreign Exchange Outgo in terms of actual outflows

1.9

4.7

II. No written complaints have been received by the Company during the year under review pursuant to Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

III. No stock options were granted to the Directors of your Company during the year under review.

IV. Additional information and details as specified in Rule 8(5) of the Companies (Accounts) Rules, 2014 are included in the Directors'' Report.

22. General Disclosures

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

i. Details relating to deposits covered under Chapter V of the Companies Act, 2013.

ii. Issue of equity shares with differential rights as to dividend, voting or otherwise.

iii. Issue of shares including sweat equity shares to employees of the Company under any scheme save and except Employee Stock Options Scheme referred to in this Report.

iv. Neither the Managing Director nor the Whole-time Directors of the Company received any remuneration or commission from the subsidiary company.

v. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.

23. Extracts of Annual Return

Pursuant to Sections 134 (3) (a) and 92 (3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the extracts of Annual Return as at March 31 , 2017 is annexed as Annexure E which forms part of this report.

24. Directors'' Responsibility Statement The Directors confirm that:-

i. in the preparation of the annual accounts for the year ended March 31, 2017, the applicable accounting standards have been followed and no material departures have been made from the same;

ii. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of the affairs of the Company at the end of the financial year 2016-17 and of the loss of the Company for that period;

iii. they have taken proper and sufficient care 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;

iv. they have prepared the annual accounts on a going concern basis;

v. they have laid down internal financial controls for the Company and such internal financial controls are adequate and operating effectively; and

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

25. Utilization of net proceeds from the Initial Public Offering ("Issue")

Pursuant to the approval of the Members of the Company obtained through Postal Ballot on November 27, 2015 the objects of the issue as disclosed in the Prospectus dated May 22, 2012 issued by the Company for its Initial Public Offer were varied. In terms of variation, the Company had proposed to utilize the balance unutilized amount of Rs. 578.5 million as on March 31, 2015 towards development of new restaurants/ conversion of existing restaurants under new formats in various locations across the country depending upon various factors such as the customer''s preference, competition, suitable location, selection of suitable premises at an affordable rent, etc., in the financial years 2015-18.

The Company had utilized Rs. 264.8 million upto March 31, 2017 out of the balance unutilized amount of Rs. 578.5 million towards the new objects relating to the business of the Company approved by the Members on November 27, 2015.

The Company has a good set of brands in different cuisines and segments and has also been investing in refreshing of brands to service the aspirations of all guests across geographies. The Company is well poised to effectively capture the growth opportunities in food and beverage domain.

The details of utilization of the IPO Proceeds and the balance outstanding as on March 31, 2017 are provided in the Corporate Governance Report.

26. Acknowledgement

Your Directors would like to express their appreciation for the assistance and co-operation received from the Banks, Government Authorities, Customers, Vendors and Members during the year under review.

Your Directors also wish to place on record their appreciation for the committed services by the Executives, Staff and Employees of the Company.

For and on behalf of the Board

Speciality Restaurants Limited

Susim Mukul Datta

Place: Mumbai. Chairman

Date: May 27, 2017 (DIN: 00032812)


Mar 31, 2015

Dear Members,

The Directors are pleased to present the Sixteenth Annual Report together with the audited Financial Statements of the Company for the financial year ended March 31, 2015.

1. Financial Results

(Rs. in Millions)

particulars March 31, 2015 March 31, 2014

Revenue from operations 2,993.8 2,638.5

Other Income 77.1 98.3

Total Income 3,070.9 2,736.8

Earnings before Interest, Tax, Depreciation and Amortisation 368.3 438.0

Less:

Finance Costs 0.8 0.7

Depreciation /Amortization 252.3 190.3

Net profit for the year before Taxes 115.2 247.0

Less: Taxes expense / (credit)

Current Tax 50.2 81.0

Deferred Tax (29.5) (22.9)

profit for the year 94.5 188.9

Add: Balance brought forward from previous year 941.5 807.5

Less: Depreciation on transition to Schedule II of the Companies 0.9 - Act, 2013 (net of deferred tax of Rs. 0.5 millon)

Available for Appropriations 1,035.1 996.4

Less: Appropriations:-

Proposed Dividend on Equity Shares (Rs.1 per share of Rs. 10 each) 47.0 47.0

Corporate Dividend Tax 9.6 8.0

Balance of profit carried forward to Balance Sheet 978.5 941.4

2. financial performance and the state of Company''s affairs

The Indian economy grew at the rate of 7.5% year-on-year in the last quarter of the financial year 2014-15 and at 7.3% for the entire financial year 2014-15 (provisionally), as per the Central Statistical Organisation. However, the broader growth indicators continue to be slow-moving.

The ''Mid-Year Economic Analysis 2014-15'' also expects the retail inflation measured in terms of Consumer Price Index (CPI) to be in the range of 5.1% -5.8 % in the next five quarters, which is encouraging. For the year under review, the retail inflation in March dropped to a three month low of 5.17% as compared to 8.25% in the corresponding period of the previous year.

The Fine Dining Industry continues to face the twin challenges of higher costs and lower discretionary spends. The Fine Dining Market, part of the organized Chain Market Segment is still at a nascent stage in India. However, this market is likely to grow at a CAGR of around 15% over the next five years and is estimated to reach a size of Rs. 1,010 crore by 2018.

The market segments of the food service industry that are right on top are the Quick Service Restaurants ("QSR") with 43% market share followed by casual dine-in at 31% while cafe chains, frozen desserts and ice-creams form 6% of the share followed by fine dining at 4%. The rest of the market is shared by pubs, bars, clubs and lounges. QSR and casual dine-in are popular with the working professionals while fine dining is family and occasion oriented.

During the year under review, your Company commenced 14 restaurants out of which 10 are Company Owned Company Operated (COCO) while 4 are Franchise Owned Company Operated (FOCO). Out of the 4 FOCO restaurants, 2 represent international destinations in Dar es Salaam, Tanzania. At the end of the financial year 2014-15, your Company has 97 Restaurants and 18 Confectionaries.

The total Income of your Company increased to Rs. 3070.9 million from Rs. 2736.8 million in the previous year recording a growth of 12.20%.

The Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA) amounted to Rs. 368.3 million (12% of the revenue) as against Rs. 438.0 million (16% of the revenue) in the previous year.

The Net Profit after Tax was Rs. 94.5 million as againstRs.188.9 million in the previous year.

Amidst the challenging economic conditions, your Company cautiously proceeded with its expansion plan charted out for the year. Your Company has initiated measures to efficiently utilize its physical and human assets, to rationalize and re-engineer costs and to tactically increase margins while retaining the footfalls through reverse innovative measures.

3. Dividend on Equity Shares

Your Directors are pleased to recommend a dividend of Rs. 1.00 per share (Previous Year Rs. 1.00 per share) for the financial year ended March 31, 2015.

4. Investment

During the year under review, the Company had entered into a Share Purchase and Shareholders'' Agreement with Love Sugar and Dough Private Limited (LSDPL), Mr. Nauzad Kersi Munshi and Ms. Tarannum Imtiaz Merchant, the Promoters of LSDPL for acquisition of 51% stake in LSDPL and accordingly acquired 51% stake in LSDPL by purchase of 5,100 equity shares of LSDPL for a consideration of Rs. 7.5 million and thus LSDPL became the Subsidiary of the Company with effect from December 30, 2014.

The Board of Directors of the Company at their Meeting held on April 28, 2015 have approved the proposal for the sale of entire stake of 51% (5,100 equity shares) held in LSDPL for a consideration of Rs. 5.7 million back to its Promoters.

The Company proposes to enter into a Share Sale Agreement with LSDPL and the Promoters of LSDPL for the proposed sale. In view of this, LSDPL would cease to be the Subsidiary of the Company upon completion of the sale transaction.

5. Employee Stock Option Scheme (ESOS)

During the year under review, the Company has not granted any fresh stock option to its employees.

Details of the shares granted under Employee Stock Option Scheme (ESOS), as also the disclosures in compliance with Section 62 of Companies Act, 2013, Rule 12 of the Companies (Share Capital and Debentures) Rules, 2014 and Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 (the "SEBI Guidelines") are annexed as Annexure A which forms part of this report.

Your Company''s Auditors M/s. Deloitte Haskins and Sells LLP, Chartered Accountants, have certified that the ESOS has been implemented in accordance with the SEBI Guidelines and the resolutions passed by the Members of the Company in this regard.

6. Awards and Recognition

Your Company''s brand initiatives has been recognized and appreciated across forums. During the year under review your Company has won the following awards:

Awards

Mainland China, Begumpet, Hyderabad won ''Times Food Awards'' in the category of Best Chinese for the year 2014-15. Mainland China, Chandigarh won ''Times Food Awards'' in the category of Best Chinese for the year 2015.

Mainland China, Jaipur won ''Times Food Awards'' in the category of Best Chinese.

Mainland China, Orion Mall, Bengaluru won ''I Ate Here Awards'' by Mouthshut.com in the category of Best Chinese Cuisine. Mainland China, Indiranagar, Bengaluru won ''I Ate Here Awards'' by Mouthshut.com in the category of Best Chinese Cuisine. Mainland China, Bandra, Mumbai, won ''I Ate Here Awards'' by Mouthshut.com in the category of Best Chinese.

Oh! Calcutta, Bengaluru won ''Times Food Awards'' in the category of Best Bengali for the year 2015.

Sigree, Vashi, Mumbai won ''I Ate Here Awards'' by Mouthshut.com in the category of Best Buffet.

Sigree Global Grill, Mumbai Suburbs won ''Times Food Awards'' in the category of Multi-Cuisine Buffets for the year 2015. Haka brand won the Zomato Users'' Choice Award'' for Buffet.

Cafe Mezzuna, Kolkata won ''Times Food Awards'' in the category of Best European/ Continental for the year 2015.

7. Directors and Key Managerial personnel

I. Directors

Your Company has Seven (7) Directors of which Four (4) are Independent Directors and Three (3) are Executive Directors as on March 31, 2015.

II. Cessation

Mr. Vishal Sood (DIN 01780814) resigned from the Board w.e.f. March 20, 2015.

The Board placed on record its appreciation for the valuable services rendered and contribution made by Mr. Vishal Sood during his tenure as Director of the Company.

III. Independent Directors

In terms of the definition of ''Independent Director'' as prescribed under Clause 49 of the Listing Agreement entered into with the Stock Exchanges and Section 149 (6) of the Companies Act, 2013, the Company has received necessary declaration from each Independent Director under Section 149 (7) of the Companies Act, 2013, to the effect that he meet the criteria of independence laid down in Section 149 (6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. The following Non-Executive Directors are Independent Directors of the Company:

1. Mr. Susim Mukul Datta

2. Mr. Jyotin Mehta

3. Mr. Tara Sankar Bhattacharya

4. Mr. Dushyant Mehta

IV. Woman Director

Mrs. Suchhanda Chatterjee is a Director since incorporation of the Company. Accordingly, the requirements of the provisions of Section 149 of the Companies Act, 2013 and Clause 49 of the Listing Agreement have been complied with by the Company.

V. Managing Director and Whole-time Directors

Mr. Anjan Chatterjee has been serving as the Managing Director of the Company since December 2007.

Mrs. Suchhanda Chatterjee and Mr. Indranil Chatterjee have been serving as Whole-time Directors of the Company since July, 2010.

VI. Appointment/Resignations of Key Managerial personnel

Mr. Anjan Chatterjee, Managing Director; Mrs. Suchhanda Chatterjee, Whole-time Director; Mr. Indranil Chatterjee, Whole-time Director; Mr. Rajesh Kumar Mohta, Executive Director-Finance and CFO and Mr. V.S. Satyamoorthy, Company Secretary are the Key Managerial Personnel of the Company as per the provisions of the Companies Act, 2013 and were already in office before the commencement of the Companies Act, 2013.

None of the Key Managerial Personnel has resigned or appointed during the year under review.

VII. Re-appointment of Whole-time Directors

Mrs. Suchhanda Chatterjee (DIN 00226893)

The Board of Directors of the Company at their meeting held on May 27, 2015, subject to the approval of the Members in the ensuing Annual General Meeting of the Company, approved the re-appointment of Mrs. Suchhanda Chatterjee, as Whole-time Director of the Company designated as Director-Interior and Design for a period of three years with effect from July 1, 2015.

Mr. Indranil Chatterjee (DIN 00200577)

The Board of Directors of the Company at their meeting held on May 27, 2015, subject to the approval of the Members in the ensuing Annual General Meeting of the Company, approved the re-appointment of Mr. Indranil Chatterjee, as Whole-time Director of the Company designated as Director-Commercial Operations for a period of three years with effect from July 1, 2015.

Further details about the above Whole-time Directors seeking re-appointment in the ensuing Annual General Meeting are annexed to the Notice which is being sent to the Members alongwith the Annual Report.

VIII. Evaluation of Board''s performance

The Nomination and Remuneration Committee and the Board of Directors at their meetings held on March 24, 2015 had laid down the criteria for the performance evaluation of Directors (Executive and Non-Executive Independent Directors including Chairman), Committees of the Board and the Board as a whole and the evaluation process for the same in compliance with the requirements under the Companies Act, 2013 and Clause 49 of the Listing Agreement.

The manner in which the formal annual evaluation of the Directors, Committees of the Board and the Board as a whole is to done is given in the report on Corporate Governance which forms part of the Annual Report.

The performance of the Members of the Board, the Committees of the Board and the Board as a whole was evaluated at the Meeting of Independent Directors and the Board of Directors held on March 24, 2015.

IX. policy on Directors'' remuneration and other details

The Company''s policy relating to remuneration of Directors, Key Managerial Personnel and other Employees as stipulated under Section 178 (4) of the Companies Act, 2013, has been disclosed in the Corporate Governance report, which forms part of the Directors'' report.

X. Number of Board Meetings

The Board of Directors met Seven (7) times during the financial year 2014-15. Detailed information on the Meetings of the Board is included in the report on Corporate Governance which forms part of this Annual Report. A separate Meeting of Independent Directors was also held during the financial year 2014-15.

Besides the above, several Committee Meetings of the Board were held during the financial year 2014-15, the detailed information of which is included in the report on Corporate Governance.

XI. Change in Share Capital

The Paid-up Equity Share Capital of the Company as on March 31, 2015 was Rs. 46,95,76,570/-. During the year under review, there was no change in the issued, subscribed and paid-up share capital of the Company.

XII. Related Party Transactions

All the related party transactions during the year were entered in the ordinary course of business and on arm''s length basis. There were no materially significant related party transactions entered during the year by your Company. Accordingly, no transactions are being reported in Form No.AOC-2 in terms of Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014.

All Related Party Transactions are presented to the Audit Committee and the Board for approval. Omnibus approval is obtained for the transactions which are foreseen and repetitive in nature.

The Policy on Materiality of Related Party Transactions and also on Dealing with Related Party Transactions as approved by the Board is uploaded on the Company''s website at the following web link:- http://www.speciality. co.in/pdf/policies/POLICY ON MATERIALITY OF RELATED PARTY TRANSACTIONS AND ALSO ON DEALING WITH RELATED PARTY TRANSACTIONS.pdf

The details of the transactions with Related Parties are provided on page no.97 under Financial Statements.

8. Report on Corporate Governance

The report on Corporate Governance as stipulated under Clause 49 of the Listing Agrement/s forms part of the Annual Report. The requisite Certificate from the Practising Company Secretaries confirming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49 is attached to this report.

9. Management Discussion and Analysis Report

As stipulated under Clause 49 of the Listing Agreement/s with the Stock Exchanges, Management Discussion and Analysis Report for the financial year under review is provided in a separate section forming part of the Annual Report.

10. Composition of Audit Committee

The details relating to the composition of the Audit Committee are provided in the Report on Corporate Governance which forms part of this report.

11. Corporate Social Responsibility

In terms of Section 135 of the Companies Act, 2013, the Board of Directors of your Company has constituted a Corporate Social Responsibility Committee ("CSR Committee") under the Chairmanship of an Independent Director of the Company. The CSR Committee of the Board has formulated a CSR Policy which has been uploaded on the Company''s website at the following web link: www.speciality.co.in.

The Annual Report on CSR activities as prescribed under Section 135 of the Companies Act, 2013 is annexed as Annexure B which forms part of this report.

12. Vigil Mechanism

In pursuance of the provisions of Sections 177(9) and 177(10) of the Companies Act, 2013, a Vigil Mechanism for Directors and Employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the Company''s website at the following web link: www.speciality.co.in.

13. Risk Management

Your Company has constituted a Risk Management Committee in November, 2014 for complying with the requirements of the Companies Act, 2013 and Clause 49 of the Listing Agreement with the Stock Exchanges to implement the risk management plan and policy of the Company.

The Committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The Audit Committee has additional oversight in the areas of internal financial and risk management systems.

14. particulars of loans, guarantees or investments

Disclosure on particulars of loans, guarantees or investments made during the financial year 2014-15 under Section 186 of the Companies Act, 2013 is provided on page no. 98 under Financial Statements.

15. Consolidated Financial Statements

Subsequent to the year end, the Company has proposed to enter into a Share Sale Agreement for the proposed sale of its entire stake of 5,100 equity shares of Love Sugar and Dough Private Limited ("LSDPL") aggregating to 51% of the issued and paid-up equity share capital of LSDPL held by the Company for an aggregate consideration of Rs. 5.7 million. As the control was intended to be temporary, no consolidated financial statements have been prepared by the Company.

16. Internal financial Control Systems and their adequacy

Your Company has laid down adequate internal financial controls, through requisite policies and procedures. Such controls are operating effectively to ensure accuracy and completeness of the accounting records, the timely preparation of reliable financial information alongwith the orderly and efficient conduct of business.

17. Auditors and Audit Reports

I. Statutory Auditors and their report

M/s. Deloitte Haskins and Sells LLP were appointed as Statutory Auditors of the Company at the Fifteenth Annual General Meeting held on September 15, 2014 to hold office until the conclusion of the Annual General Meeting to be held in the year 2019. As per the provisions of Section 139 of the Companies Act, 2013 the appointment of Auditors is required to be ratified by the Members at every Annual General Meeting. A resolution for ratification is included in the Notice which is being sent to the Members alongwith the Annual Report.

II. Secretarial Auditor and Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act, 2013, your Company had appointed M/s. GMJ & Associates, Company Secretaries as Secretarial Auditor to conduct the Secretarial Audit for the financial year 2014-15.

The Report of the Secretarial Auditor for the financial year 2014-15 is annexed as Annexure C which forms part of this report.

There were no audit qualifications in the Statutory Auditors'' Report as well as the Secretarial Audit Report for the financial year 2014-15 as annexed to this Annual Report.

18. particulars of Employees

The ratio of remuneration of each director to the median employee''s remuneration and other details in terms of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed as Annexure D which forms part of this report.

A Statement containing particulars of employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure E which forms part of this report.

19. I. Statutory Disclosures

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

The activities of the Company are not covered under the disclosures required as per the provisions of Section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 (3) (A & B) of the Companies (Accounts) Rules, 2014 regarding conservation of energy and technology absorption.

ii. Foreign Exchange Earnings and Outgo

The disclosures required as per the provisions of Section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 (3) (C) of the Companies (Accounts) Rules, 2014 regarding foreign exchange earned in terms of actual inflows and Foreign Exchange outgo during the year under review in terms of actual outflows are given below:

(Rs. in Millions)

foreign Exchange Earnings and Outgo 2014-15 2013-14

Foreign Exchange Earned in terms of actual inflows 4.1 -

Foreign Exchange Outgo in terms of actual outflows 8.3 7.8

iii. No written complaints have been received by the Company pursuant to Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

iv. No stock options were granted to the Directors of your Company during the year under review.

II. General

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

i. Details relating to deposits covered under Chapter V of the Companies Act, 2013.

ii. Issue of equity shares with differential rights as to dividend, voting or otherwise.

iii. Issue of shares including sweat equity shares to employees of the Company under any scheme save and except Employee Stock Option Scheme referred to in this Report.

iv. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from the subsidiary company.

v. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.

20. Extracts of Annual Return

Pursuant to Sections 134 (3) (a) and 92 (3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the extracts of Annual Return as at March 31, 2015 is annexed as Annexure F which forms part of this report.

21. Directors'' Responsibility Statement

The Directors confirm that:-

i. in the preparation of the annual accounts for the year ended March 31, 2015, the applicable accounting standards have been followed and no material departures have been made from the same;

ii. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of the affairs of the Company at the end of the financial year 2014-15 and of the profit of the Company for that period;

iii. they have taken proper and sufficient care 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;

iv. they have prepared the annual accounts on a going concern basis;

v. they have laid down internal financial controls for the Company and such internal financial controls are adequate and operating effectively; and

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

22. Utilisation of net proceeds from the Initial public Offering ("Issue")

In terms of the schedule of deployment of net proceeds from the Issue, disclosed in the Prospectus dated May 22, 2012 (the "Prospectus"), the Company had proposed to utilise Rs. 1,316.0 million towards development of new restaurants, Rs. 151.0 million towards development of a food plaza, Rs. 94.2 million towards repayment of portion of term loan facilities and Rs. 10.5 million towards general corporate purpose in the financial years 2012-13 to 2014-15.

The details of utilization of the IPO Proceeds as of March 31, 2015 and the balance outstanding as on March 31, 2015 are provided in the Report on Corporate Governance.

In view of the economic slow-down and decrease in the discretionary spend of the customers the Company has been unable to utilize Rs. 578.5 million. Accordingly, your Company will be seeking approval of the Members to vary the Objects of the Issue as disclosed in the Prospectus dated May 22, 2012 for the amount unutilized as of March 31, 2015.

23. Acknowledgement

Your Directors would like to express their appreciation for the assistance and co-operation received from the Banks, Government Authorities, Customers, Vendors and Members during the year under review.

Your Directors also wish to place on record their appreciation for the committed services by the Executives, Staff and Employees of the Company.

For and on behalf of the Board Speciality Restaurants Limited

Susim Mukul Datta Chairman

Date: May 27, 2015 Place: Mumbai.


Mar 31, 2014

The members

Speciality Restaurants Limited.

The Directors are pleased to present the Fifeenth Annual Report together with the audited financial statements of the Company for the financial year ended March 31, 2014.

1. Financial Results:

(Rs. in millions)

Particulars March 31, 2014 March 31, 2013

Revenue from operations 2638.5 2269.2

Other Income 98.4 91.2

Total income 2736.9 2360.4

Earnings before Interest, Depreciaton, Amortization and Tax 438.0 459.1

Less:

Finance Costs 0.7 5.0

Depreciaton /Amortization 190.3 149.3

Net profit for the year before Taxes 247.0 304.8

Less: Provision for Taxes

Current Tax 81.0 90.6

Deferred Tax (22.9) (19.9)

Profit afer tax 188.9 234.1

Add: Balance Brought Forward from Previous Year 807.4 628.3

Available for Appropriatons 996.3 862.4

Less: Appropriatons:-

Proposed Dividend on Equity Shares (Re. 1 per share of Rs. 10 each) 47.0 47.0

Corporate Dividend Tax 8.0 8.0

Balance profit 941.4 807.4

2. Financial Performance:

The Indian economy, Asia''s third largest has displayed declining growth rate over the last couple of years. During the year ended March 31, 2014 GDP growth remained muted at sub 5% levels. The year also saw sharp currency depreciaton while industrial actvity remained in contracton mode, consumpton demand contnued to weaken and declining Capital Goods producton was indicatve of stalled investment demand.

With sluggish growth across all sectors in the economy, the demand for the Fine Dining Industry too remained moderated throughout the year, primarily due to high Consumer Price Infaton (CPI) and weak sentment. This problem was further compounded by lower discretonary spends.

The operatng context for the year was challenging, given the backdrop of a market slowdown, a volatle input cost environment and heightened compettve intensity. Moreover, as the discretonary spends remained lower, the break-even period for your Company''s restaurants too was impacted. Further the need to record all costs related to opening of new restaurants on an upfront and actual basis added to the pressure on the operatng front.

Your Company''s performance for the year 2013-14 has to be viewed in the context of abovementoned economic and market environment.

The total Income of your Company increased to Rs. 2,736.9 million from Rs.2,360.4 million in the previous year recording a growth of 15.9%.

The profit before Depreciaton, Interest and Tax (PBDIT) amounted to Rs. 438.0 million (16.0% of the revenue) as against Rs. 459.1 million (19.5% of revenue) in the previous year.

The Net profit afer Tax was Rs.188.9 million as against Rs. 234.1 million in the previous year.

Despite, the challenging economic conditons, your Company proceeded with its expansion plan charted out for the year. Your Company has initated measures to efciently utlize its physical and human assets by sweatng them, to ratonalize and re-engineer costs and to tactcally hike prices while retaining the footalls through reversal innovatve measures.

Following the General Electons held a few months back we have a new Government with a comfortable majority. There is an air of cautous optmism that economic reforms will be put back on track and a business friendly set of initatves will be put in place to revive overall growth in the economy.

3. Dividend on equity shares:

Your Directors are pleased to recommend a dividend of Re. 1.00 per share (Previous Year Re. 1.00 per share) for the financial year ended March 31, 2014.

4. Investments in the Joint Venture Company:-

Your Company entered into a joint venture with the Al Mohannadi Group for the purpose of setng up a restaurant under the brand name "Mainland China" and a Joint Venture Company was incorporated during the financial year 2013-14 under the name of "Mainland China Restaurant LLC" in Doha, Qatar.

The Company had invested 4,90,000 QAR (Qatari Riyal) in the equity instruments of the Joint Venture Company for the subscripton of 490 equity shares of QAR 1000 each, fully paid-up.

5. Employee stock opton scheme:

Your Company has granted 5,77,200 Optons to the employees of the Company under Speciality Restaurants Limited- Employee Stock Opton Scheme 2012 (the "ESOP Scheme").

Details of the Optons granted to the Employees as on March 31, 2014 and other disclosures as required under Clause 12 of the Securites and Exchange Board of India (Employees Stock Opton Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 (the "SEBI Guidelines") are set out in the Annexure to this Report.

Your Company''s Auditors M/s. Deloite Haskins and Sells LLP, Chartered Accountants, have certfed that the ESOP Scheme has been implemented in accordance with the SEBI Guidelines and the resolutons passed by the members of the Company in this regard.

6. Operatons:

The operatons of your Company are elaborated in the annexed Management Discussions and Analysis Report.

7. Management Discussion and Analysis Report:

As stpulated under Clause 49 of the Listng Agreement/s Management Discussion and Analysis Report for the financial year under review is presented in a separate secton forming part of the Annual Report.

8. Awards & Recogniton:

Your Company''s brand initatve have been recognized and appreciated across forums. During the year under review your Company has won following awards:-

Year Awards

2013 Mainland China, Gurusaday Road won the Telegraph Food Guide Award in the category of Best Oriental Cuisine.

2013 Mainland China, Chandigarh won ''Times Food Award'' in the category of Best Chinese.

2013 Oh! Calcuta, Mumbai won ''Times Food Award'' in the category of Best Bengali.

2013 Oh! Calcuta, Delhi won ''Times Food Award'' in the category of Best Bengali.

2013 Oh! Calcuta, Kolkata won the Telegraph Food Guide Award in the category of Best Bengali.

2013 Oh! Calcuta won the Chef''s Favourite in Asia''s 50 Best Restaurants (Singapore).

2013 Sigree, Vashi won the Srisht Online Channel Award in the category of Best Grill & Buffet.

2014 Mainland China, Mumbai won ''Times Food Award'' in the category of Best Chinese.

2014 Mainland China, Pune won ''Times Food Award'' in the category of Best Chinese.

2014 Mainland China, Goa won ''Times Food Award'' in the category of Best Chinese.

2014 Mainland China, Mumbai Won ''Master Brand Award'' (Asia Retail Congress).

2014 Oh! Calcuta, Mumbai won ''Times Food Award'' in the category of Best Bengali.

2014 Oh! Calcuta, Pune won ''Times Food Award'' in the category of Best Bengali.

2014 Oh! Calcuta, Bengaluru won ''Times Food Award'' in the category of Best Bengali.

2014 Oh! Calcuta, Delhi won ''Times Food Award'' in the category of Best Bengali.

2014 Sigree Global Grill, Powai won ''Times Food Award'' in the category of Mult Cuisine Bufets.

2014 Mezzuna, Pune won ''Times Food Award'' in the category of Best Pizza.

2014 Mezzuna, Pune won ''Times Food Award'' in the category of All Day Dining.

2014 Haka, City Centre Kolkata won ''Mouth Shut Award'' in the category of Best Bufet.

2014 Haka, City Centre Kolkata won ''Mouth Shut Award'' in the category of Best Chinese.

2014 Sweet Bengal, Mumbai won ''Times Food Award'' in the category of Best Mithai.

9. Directors:

In accordance with the erstwhile provisions of the Companies Act, 1956 and the Company''s Artcles of Associaton, Mr. Susim Mukul Data, Mr. Jyotn Mehta, Mr. Dushyant Mehta and Mr. Tara Sankar Bhatacharya, were appointed as Directors of the Company and are liable to retre by rotaton.

Secton 149 of the Companies Act, 2013 and the rules made thereunder provides for the appointment of independent directors. Sub-secton 10 of Secton 149 of the Companies Act, 2013 and the rules made thereunder Specifically provides that independent directors shall hold ofce for a term of upto five consecutve years on the Board of a Company. Sub-secton (11) of Secton 149 of the Companies Act, 2013 and the rules made thereunder states that no independent director shall be eligible for more than two consecutve terms of five years. Any tenure of an independent director on the date of commencement of the Companies Act, 2013 shall not be counted as a term under sub-sectons 10 and 11 of the Companies Act, 2013 except as may be provided in accordance with the rules made thereunder. Sub-secton (13) of Secton 149 of the Companies Act, 2013 states that the provisions of retrement by rotaton as Defined in sub-sectons (6) and (7) of Secton 152 of the Companies Act, 2013 shall not apply to such independent directors.

Your non-executve and independent/non-independent directors were appointed as directors liable to retre by rotaton under the provisions of the erstwhile Companies Act, 1956. Mr. Tara Sankar Bhatacharya and Mr. Dushyant Mehta, Independent Directors of the Company are not liable for retrement by rotaton at this Annual General Meetng. Mr. Vishal Sood, Non-Executve Non-Independent Director is also not liable for retrement by rotaton at this Annual General Meetng. However, in order to comply with the requirements of the Companies Act, 2013 and the rules made thereunder, your Directors seek the appointment of Mr. Susim Mukul Data, Mr. Jyotn Mehta, Mr. Tara Sankar Bhatacharya and Mr. Dushyant Mehta as Independent Directors for a period of five consecutve years with efect from April 1, 2014 upto March 31, 2019 and the re-appointment of Mr. Vishal Sood as Non-Executve and Non-Independent Director of the Company liable to retre by rotaton.

10. directors'' responsibility statement:

Pursuant to the requirement under Secton 217(2AA) of the Companies Act, 1956, with respect to the Directors'' Responsibility Statement, it is hereby confirmed that:

i) The financial statements are prepared in conformance with the accountng standards issued by the Insttute of Chartered Accountants of India and the requirements of the Companies Act, 1956, to the extent applicable to the Company on the historical cost conventon; as a going concern and on the accrual basis.

There are no material departures from prescribed accountng standards in the adopton of the accountng standards. The accountng policies used in the preparaton of the financial statements have been consistently applied except as otherwise stated in the notes on accounts;

ii) the Directors have selected such accountng policies and applied them consistently and made judgment and estmates that are reasonable and prudent so as to give a true and fair view of the state of afairs of the Company as at March 31, 2014 and of the profit of the company for the year ended on that date;

iii) the Directors have taken proper and sufcient care for the maintenance of adequate accountng records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventng and detectng fraud and other irregularites; and

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

11. Conservaton of energy, Technology absorpton and foreign exchange earnings and outgo:

The Partculars required as per the provisions of Secton 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosures of Partculars in the Report of Board of Directors) Rules, 1988 regarding conservaton of energy and technology absorpton are not given as the Company has not undertaken any manufacturing actvity.

12. Informaton pursuant to secton 217 (2a) of the Companies act, 1956:

During the year under review, none of the employees of the Company, whether employed for the whole year, or part thereof, was in receipt of remuneraton aggregatng to or in excess of the limits specified under Secton 217(2A) of the Companies Act, 1956 read with the Companies (Partculars of Employees) Rules, 1975, as amended.

13. Consolidated financial statements:

The Company does not have any subsidiaries. It is not required to publish Consolidated Financial Statements.

14. Report on Corporate Governance:

The Report on Corporate Governance as stpulated under Clause 49 of the Listng Agreement/s entered into by the Company with the stock exchange forms part of the Annual Report.

The requisite certfcate from the Company Secretaries confirming compliance with the conditons of Corporate Governance as stpulated under the aforesaid Clause 49 of the listng agreement is atached to this report.

15. Utlisaton of net proceeds from the inital public ofering ("issue")

As per the schedule of deployment of net proceeds from the Issue, disclosed in the prospectus dated May 22, 2012 (the "Prospectus"), the Company had proposed to utlize Rs. 1316.01 million towards development of new restaurants, Rs. 151.0 million towards development of a food plaza, Rs. 94.16 million towards repayment of porton of term loan facilites and Rs. 10.52 million towards general corporate purpose.

Your Directors like to inform you that as at March 31, 2014, the proceeds from the Issue earmarked towards repayment of porton of term loan facilites have been fully utlized. Further utlizaton of Rs.385.10 million scheduled to have been utlized in the financial years 2013 and 2014 towards development of new restaurants, is being utlized progressively in the light of existng economic conditons.

Further, the Company had intended to utlize Rs. 151.00 million towards development of a food plaza by financial year 2014. On account of delays with respect to obtaining of certain approvals, the Company has not been in a positon to deploy funds towards development of the food plaza. The Company intends to deploy such funds on receipt of the relevant approvals.

16. Auditors:

M/s Deloite Haskins & Sells LLP, (Formerly known as Deloite Haskins and Sells) Chartered Accountants, the Statutory Auditors of the Company, hold ofce untl the conclusion of the ensuing Annual General Meetng and are eligible for re-appointment for a period of five years as per the provisions of the Companies Act, 2013. It has been recommended to the shareholders to re-appoint M/s Deloite Haskins & Sells LLP, Chartered Accountants, for a period of five years from the conclusion of the ensuing Annual General Meetng.

The Company has received writen consent for the appointment as the Statutory Auditors as required under Secton 139 of the Companies Act, 2013.

17. Corporate social responsibility:-

As per the Companies Act, 2013 all companies having net worth of Rs. 500 crore or more or turnover of Rs. 1,000 crore or more or a net profit of Rs. 5 crore or more during any financial year will be required to consttute a corporate social responsibility (CSR) commitee of the Board of Directors comprising three or more directors, atleast one of whom will be an independent director.

In order to comply with the requirements of Secton 135 of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014, your Company has consttuted a Corporate Social Responsibility Commitee ("CSR Commitee") comprising Mr. Jyotn Mehta, Mr. Dushyant Mehta and Mrs. Suchhanda Chaterjee. The CSR Commitee is responsible for formulatng and monitoring the CSR policy of the Company in accordance with the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014.

18. Acknowledgement:

Your Directors would like to express their appreciaton for the assistance and co-operaton received from the banks, Government authorites, customers, vendors and members during the year under review.

Your Directors also wish to place on record their appreciaton for the commited services by the executves, staf and workers of the Company.

For and on behalf of the Board

Speciality Restaurants Limited

Susim Mukul Data Chairman

Date : May 28, 2014. Place: Mumbai


Mar 31, 2013

To The Members of Speciality Restaurants Limited.

The Directors are pleased to present the Fourteenth Annual Report together with the audited financial statements of the Company for the financial year ended 31st March, 2013.

1. Financial Results:

(Rs. in millions)

Particulars 31st March, 2013 31st March, 2012

Revenue from operations 2269.2 1962.3

Other Income 91.6 27.1

Total Income 2360.8 1989.4

Earnings before Interest, Depreciation, Amortization and Tax 459.1 402.1

Less:

Finance Costs 5.0 26.6

Depreciation /Amortization 149.3 128.7

Net Profit for the year before Taxes 304.8 246.8

Less: Provision for Taxes

Current Tax 90.6 93.6

Deferred Tax (19.9) (19.2)

Profit after tax 234.1 172.4

Add: Balance Brought Forward from Previous Year 628.3 455.8

Available for Appropriations 862.4 628.2

Less: Appropriations:-

Proposed Dividend on Equity Shares (Re. 1 per share of Rs. 10 each) 47.0 -

Corporate Dividend Tax 8.0 -

Balance Profit 807.4 628.2

2. Financial Performance:

The Total Income of your Company increased to Rs. 2360.8 million from Rs. 1989.4 million in the previous year, thus a growth of 18.67% over the previous year.

The Profit before Depreciation, Interest and Tax (PBDIT) amounted to Rs. 459.1 million (19.45% of the revenue) as against Rs. 402.1 million (20.21% of revenue) in the previous year.

The Net Profit after Tax was Rs.234.1 million as against Rs. 172.4 million in the previous year registering a growth of 35.79%.

3. Dividend on Equity Shares:

Your Directors recommend payment of maiden dividend for the financial year ended 31st March, 2013 of Re. 1.00 per equity share of face value Rs. 10 per share amounting to Rs. 55.0 million (inclusive of Corporate Dividend Tax of Rs. 8.0 million).

The dividend payout for the year under review has been proposed keeping in view the shareholders'' aspirations and the Company''s requirement for capital.

4. Share Capital:

During the year under review, your Company had successfully completed its Initial Public Offer ("IPO") and allotted. After the allotment, the Share Capital of the Company stood at Rs. 469.58 million as on 31st March, 2013.

5. Employee Stock Option Scheme:

Your Company has framed the Speciality Restaurants Limited-Employee Stock Option Scheme 2012 in accordance with the Securities and Exchange Board of India Guidelines, 1999 (''the SEBI Guidelines'') for the welfare of the employees and to retain the talent in the organisation. As the Company is still in the process of implementing the scheme on the basis of the approval granted by the Shareholders, the applicable disclosure requirements as stipulated under the SEBI Guidelines as at 31st March, 2013 are not applicable for the financial year under review.

6. Operations:

The operations of your Company are elaborated in the annexed Management Discussion and Analysis Report.

7. Management Discussion and Analysis Report:

As stipulated under Clause 49 of the Listing Agreement/s with the Stock Exchanges in India, Management Discussion and Analysis Report for the financial year under review is presented in a separate section forming part of the Annual Report.

8. Awards & Recognition:

Your Company''s brand initiative have been recognized and appreciated across forums. During the year under review your Company has won following awards:

Year Awards

2012 Mainland China brand won the ''I Ate Here Award'' from Mouthshut.com in the category of Best Chinese Cuisine.

2012 Mainland China brand won the ''I Ate Here Award'' from Mouthshut.com in the category of Best Buffet. 2012 Mainland China brand won the ''Cremica - Indian Restaurant Awards'' in the category of Most Preferred Fine Dining Restaurant.

2012 Mainland China brand won the ''Times Food Award'' in the category of ''Best Chinese''.

2012 Mainland China won the ''Coca Cola Golden Spoon Award'' for the most admired restaurant chain in India.

2013 Mainland China brand won the ''I Ate Here Award'' from Mouthshut. com in the category of Best Chinese Cuisine.

2013 Mainland China brand won the ''Times Food Award'' in the category of ''Best Chinese''.

2013 Mainland China brand won the ''Zomato Users'' Choice Award'' for Asian and Oriental.

2012 Oh! Calcutta brand won the ''Hindustan Times Award (Crystals People''s Choice Awards)'' in the category of City''s Finest Regional Indian Restaurants.

2012 Oh! Calcutta brand won the ''Times Food Award'' in the category of Best Bengali.

2012 Oh! Calcutta brand won the ''Asia''s 50 Best Restaurants Award'' in the category of Chef Favourites.

2012 Oh! Calcutta brand won the ''I Ate Here Award'' from Mouthshut.com in the category of Best Bengali Food.

2013 Sigree brand won the ''I Ate Here Award'' from Mouthshut.com in the category of Best Barbeque.

2013 Sigree brand won the ''Times Food Award'' in the category of Best North Indian.

2013 Sigree brand won the ''Zomato Users'' Choice Award'' for Casual Dining.

2012 Flame & Grill brand won the ''I Ate Here Award'' from Mouthshut.com in the category of Best Barbeque.

2013 Machaan brand won the ''Zomato Users'' Choice Award'' for Casual Dining.

9. Directors:

In accordance with the provisions of the Companies Act, 1956 and the Company''s Articles of Association, two Directors of the Company, namely Mr. Dushyant Mehta and Mr. Tara Sankar Bhattacharya retire from office by rotation, and being eligible offer themselves for re-appointment at the ensuing Annual General Meeting of the Company.

During the year under review, Mr. Anjan Chatterjee was re-appointed as Managing Director of the Company for a period of five years with effect from 27th December, 2012 subject to the approval of the Shareholders.

10. Directors'' Responsibility Statement:

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

i) the financial statements are prepared in conformance with the accounting standards issued by the Institute of Chartered Accountants of India and the requirements of the Companies Act, 1956, to the extent applicable to the Company on the historical cost convention; as a going concern and on the accrual basis.

There are no material departures from prescribed accounting standards in the adoption of the accounting standards. The accounting policies used in the preparation of the financial statements have been consis- tently applied except as otherwise stated in the notes to accounts;

ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March 2013 and of the profit of the company for the year ended on that date;

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

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

11. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:

The Particulars required as per the provisions of Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988 regarding conservation of energy and technology absorption are not given as the Company has not undertaken any manufacturing activity. The details with regard to foreign exchange earnings and outgo are as under:-

(Rs. in million)

Foreign Exchange Earnings and Outgo: 2012-13 2011-12

Foreign Exchange Earned 3.28 3.27

Foreign Exchange Used 8.92 4.74

12. Information pursuant to Section 217 (2A) of the Companies Act, 1956:

During the year under review, none of the employees of the company, whether employed for the whole year, or part thereof, was in receipt of remuneration aggregating to or in excess of the limits specified under Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended and hence, no particulars are required to be furnished in connection with the same.

13. Consolidated Financial Statements:

As the Company does not have any subsidiaries, it is not required to publish Consolidated Financial Statements.

14. Report on Corporate Governance:

The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement/s forms part of the Annual Report.

The requisite Certificate from the Practising Company Secretaries confirming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49 is attached to this report.

15. Utilisation of Issue Proceeds of the Initial Public Offering ("Issue"):

As per the schedule of deployment of net proceeds of the Issue, disclosed in the prospectus dated May 22, 2012 (the "Prospectus"), the Company had proposed to utilise Rs 469.19 million towards development of new restau- rants, Rs. 75.50 million towards development of a food plaza and Rs. 94.16 million towards repayment of term loans in financial year 2013.

Your directors would like to inform you that as at 31st March, 2013, issue proceeds earmarked towards repayment of term loans have been fully utilized. Further, the utilisation of Rs. 223.79 million and Rs. 75.50 million scheduled to be utilized in financial year 2013 towards development of new restaurants and food plaza, respectively has been deferred, since such expenditure was not considered to be commercially viable by the Company in light of the then existing economic conditions. The Company proposes to utilise these balance amounts towards the above mentioned objects in financial years 2014 and 2015.

16. Auditors:

M/s Deloitte Haskins & Sells, Chartered Accountants, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received a letter from the Statutory Auditors to the effect that their re-appointment, if made, would be within the prescribed limits under Section 224 (1B) of the Companies Act, 1956.

17. Acknowledgement:

Your Directors would like to express their appreciation for the assistance and co-operation received from the banks, Government authorities, customers, vendors and members during the year under review.

Your Directors also wish to place on record their appreciation for the committed services by the executives, staff and workers of the Company.

For and on behalf of the Board

Speciality Restaurants Limited

Susim Mukul Datta

Chairman Date: 29th May, 2013.

Place: Mumbai


Mar 31, 2012

The Members of Speciality Restaurants Limited.

The Directors are pleased to present the Thirteenth Annual Report together with the audited financial statements of the company for the financial year ended 31st March, 2012.

1. Financial Results:

The financial results of your Company for the financial year ended 31st March, 2012 are summarised below:

(Rs. in millions)

Particulars 31st March, 2012 31st March, 2011

Revenue from operations 1962.30 1731.05

Other Income 27.10 18.42

Total Income 1989.40 1749.47

Earnings before Interest, Depreciation and Amortization 402.08 397.03

Less:

Interest Expenses 26.64 13.21

Depreciation and Amortization 128.66 143.03

Net Profit for the year before Taxes 246.78 240.79

Less: Provision for Taxes

Current Tax 93.56 98.89

Deferred Tax Liability/ (Asset) (19.21) (18.33)

Profit after tax (which is carried forward to Balance Sheet) 172.43 160.23

Add: Balance Brought Forward from Previous Year 455.81 295.58

Cumulative Profit 628.24 455.81

2. Financial Performance:

Total income of your company increased to Rs. 1989.40 million from Rs. 1749.47 million in the previous year, thus a growth of 13.71% over the previous year.

The Profit before Depreciation, Interest and Tax (PBDIT) amounted to Rs 402.08 million (20.49 % of the revenue) as against Rs. 397.03 million (22.94% of revenue) in the previous year.

The Net Profit after tax was Rs. 172.43 million as against Rs.160.23 million in the previous year registering a growth of 7.61%.

3. Dividend on Equity Shares.

Your Directors do not recommend any dividend on Equity Shares for the year under review in order to conserve resources and for funding ongoing projects.

4. Share Capital:

During the year under review, the Company had allotted 6,687,500 equity shares against conversion of 6,405,755 compulsorily convertible preference shares held by SAIF III Mauritius Company Limited and Glix Securities Private Limited by capitalizing a sum of Rs. 2.82 million from the share premium account.

During the current year your Company had successfully launched its initial public offer ("IPO") and allotted 11,739,415 equity shares of Rs. 10 each at a premium of Rs. 140 per share. After the allotment, the Share Capital of the company stood at Rs. 469.58 million.

5. Awards & Recognition:

Your Company's brand initiative have been recognized and appreciated across forums. During the year under review your Company has won following awards:

6. Operations:

The operations of your Company are elaborated in the annexed Management Discussion and Analysis Report.

Year Awards

2012 Mainland China brand won the "Times Food Award" in the category of Best Chinese for the year 2012.

2012 Mainland China brand wons the "Images Most Admired Retailer of the Year in East India: Food Service (National Chain)

2012 The restaurant "Mainland China" located at Hyderabad was awarded the "Best Chinese Restaurant" of the year 2011 at the '2nd Epicurus Hospitality Awards'.

2012 Mainland China won the 'Coco Cola Golden Spoon Award for the most admired food service retailer of the year-dine-in international cuisine.

2012 Oh! Calcutta brand won the 'Times Food Award' in the category of 'Best Bengali' for the year 2012.

2012 Sigree Brand won the 'Times Food Award 'in the category of Best North Indian for the year 2012.

7. Directors:

The Board of Directors in their meeting held on 1st August, 2012, accepted the withdrawal of nomination of Mr. Vishal Sood as a Director of the company pursuant to the letter received from SAIF III Mauritius Company Limited. The Board wishes to place on record its high appreciation of the significant and valuable services rendered by Mr. Vishal Sood during his tenure.

The Board of Directors in their meeting held on 1st August, 2012 has appointed Mr. Vishal Sood as Additional Director. As per the provisions of Section 260 of the Companies Act, 1956 he holds office upto the date of the ensuing Annual General Meeting.

You Company has received a notice under Section 257 of the Companies Act, 1956 together with the requisite deposit, from a member proposing the appointment of Mr. Vishal Sood as a Director on the Board of the Company. Resolution seeking the approval of the members for the appointment of Mr. Vishal Sood as a Director of the Company has been incorporated in the Notice of the Annual General Meeting together with a brief resume.

In accordance with the provisions of the Companies Act, 1956 and the Company's Articles of Association, two Directors of the Company, namely Mr. Susim Mukul Datta and Mr. Jyotin Mehta, retire from office by rotation, and being eligible offer themselves for re-appointment at the ensuing Annual General Meeting of the Company. The Board recommends their re-appointment as Directors.

Brief particulars of the Directors proposed to be appointed / re-appointed as required under Clause 49 of the listing agreement are annexed to the Notice convening the 13th Annual General Meeting forming part of this Annual Report.

8. Directors' Responsibility Statement:

Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956, it is hereby confirmed that:

i ) the financial statements are prepared in conformance with the accounting standards issued by the Institute of Chartered Accountants of India and the requirements of the Companies Act, 1956, to the extent applicable to the company on the historical cost convention; as a going concern and on the accrual basis. There are no material departures from prescribed accounting standards in the adoption of the accounting standards. The accounting policies used in the preparation of the financial statements have been consistently applied except as otherwise stated in the notes on accounts;

ii) the Directors have selected such accounting policies and applied them consistently and made judgment 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 31st March, 2012 and of the profit of the company for the year ended on that date;

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

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

9. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:

The Particulars required as per the provisions of Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988 regarding conservation of energy and technology absorption are not given as the Company has not undertaken any manufacturing activity.

(Rs. in million)

Foreign Exchange Earnings and Outgo: 2011-12 2010-11

Foreign Exchange Earned 3.27 2.91

Foreign Exchange Used: 4.74 7.79

10. Information pursuant to Section 217 (2A) of the Companies Act, 1956:

During the year under review, none of the employees of the company, whether employed for the whole year, or part thereof, was in receipt of remuneration aggregating to or in excess of the limits specified under Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended and hence, no particulars are required to be furnished in connection with the same.

11. Management Discussion and Analysis:

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

12 . Corporate Governance:

Your Company was not a listed company as on 31st March, 2012. Your Company's Equity Shares got listed on May 30, 2012 both on BSE Ltd. (BSE) & National Stock Exchange of India Limited (NSE). Though strictly not necessary a detailed report on the Corporate Governance in compliance with Clause 49 of the Listing Agreement formed as a part of the Annual Report. A Certificate from the Practising Company Secretary on the compliance with Corporate Governance requirements by your Company is attached to the Report on Corporate Governance.

13. Auditors:

The Statutory Auditors of the Company, M/s Deloitte Haskins & Sells, Chartered Accountants, Mumbai retire at the conclusion of the ensuing Annual General Meeting. The Statutory Auditors have confirmed their eligibility and willingness to accept the office on re-appointment.

14. Acknowledgement:

The Board thanks the customers, vendors, investors and bankers for their continued support during the year and wish to place on record its appreciation of the contribution made by the employees at all levels. The consistent growth was made possible by their hard work, solidarity, cooperation and support.

The Board also thanks various Government regulatory authorities for their support and look forward to their continued support in the future.

The Board of Directors also expresses their sincere thanks to the members for the support and the confidence reposed by them in the Company.

For and on behalf of the Board

Speciality Restaurants Limited

Susim Mukul Datta Chairman

Date : 1st August, 2012.

Place: Mumbai

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