Annual report of advani hotel

ANNUAL REPORT

2009-2010

ADVANI HOTELS & RESORTS (INDIA) LTD.

1

dvani Hotels & Resorts (India) Limited

Page

Notice ....................................................................................................................... 3

Directors’ Report...................................................................................................... 7

Management Discussion and Analysis .................................................................... 12

Corporate Governance Report.................................................................................. 15

Auditors’ Certificate on Corporate Governance....................................................... 22

Auditors’ Report....................................................................................................... 23

Balance Sheet.......................................................................................................... 26

Profit and Loss Account .......................................................................................... 27

Cash Flow Statement .............................................................................................. 28

Schedules to Balance Sheet ................................................................................... 29

Schedules to Profit and Loss Account.................................................................... 32

Significant Accounting Policies and Notes on Accounts ........................................ 35

Statement under section 212 of the Companies Act .............................................. 46

Auditors’ Report on Consolidated Financial Statement ........................................... 47

Consolidated Balance Sheet.................................................................................... 48

Consolidated Profit and Loss Account .................................................................... 49

Consolidated Cash Flow Statement ......................................................................... 50

Schedules to Consolidated Balance Sheet ............................................................. 51

Schedules to Consolidated Profit and Loss Account .............................................. 55

Significant Accounting Policies and Notes on Consolidated Accounts .................. 57

CONTENTS

2


Annual Report 2009 - 2010

BOARD OF DIRECTORS Mr. Sunder G. Advani Chairman & Managing Director

Mr. K. Kannan

Mr. Prakash V. Mehta

Mr. Anil Harish

Mr. Haresh G. Advani Executive Director

Mrs. Menaka S. Advani

GENERAL MANAGER FINANCE (CFO) Mr. Shankar Kulkarni

COMPANY SECRETARY Mr. Kumar Iyer

AUDITORS Messrs J. G. Verma & Co.

Chartered Accountants

SOLICITORS Messrs Talwar Thakore & Associates

Messrs Malvi Ranchoddas & Co.

BANKERS Bank of Baroda

Bank of India

REGISTERED OFFICE 1009/1010, Dalamal Tower

211, Nariman Point

Mumbai - 400 021

REGISTRAR AND Datamatics Financial Services Limited

SHARE TRANSFER AGENTS Plot No. B/5, Part B Cross Lane

MIDC Marol

Andheri (East), Mumbai - 400 093

FOREIGN COLLABORATORS Wyndham Hotels, U.S.A.

(Previously Ramada International, Inc., U.S.A.)

LOCATION OF THE RESORT Ramada Caravela Beach Resort

Varca Beach, Varca Village

Salcette, Goa - 403 721

3


NOTICE

Notice is hereby given that the Twenty Third Annual General Meeting of the Members of Advani Hotels
& Resorts

(India) Limited will be held at ‘Rangaswar’, 4

th

Floor, Chavan Centre, General Jagannath Bhosale Marg, Nariman

Point, Mumbai – 400021 on Wednesday, 15

th

December, 2010 at 11.00 a.m. to transact the following business

:

ORDINARY BUSINESS:

1. To receive, consider and adopt the audited Balance Sheet as at 31st March, 2010, Profit & Loss
account for the

year ended on that date together with Reports of the Directors and Auditors thereon.

1A. To declare dividend on Equity Shares.

2. To appoint a Director in place of Mr. K. Kannan, who retires by rotation and is eligible for re-
appointment.

3. To appoint a Director in place of Mr. Prakash V. Mehta, who retires by rotation and is eligible for re-
appointment.

4. To appoint M/s. J. G. Verma & Co., Chartered Accountants, to hold the office as Auditors of the
Company from the

conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting and
to

authorise the Board to fix their remuneration.

SPECIAL BUSINESS:

5. To consider and if thought fit, to pass with or without modification the following resolution as a
Special Resolution:

“Resolved that in accordance with and pursuant to the provisions of Section 314(1B) and other
applicable provisions,

if any, of the Companies Act, 1956 and the rules and regulations thereto, including any statutory
modification(s) or

re-enactment thereof, for the time being in force and subject to the approval of the Central
Government, including

modifications, if any, the consent of the Company be and is hereby accorded for Mr. Prahlad Advani, son
of Mr.

Sunder G. Advani, Chairman & Managing Director and Mrs. Menaka S. Advani, Director and nephew of
Mr. Haresh

G. Advani, Executive Director, to hold and continue to hold an office or place of profit as the Vice
President & Asset

Manager of the Company on the following revised remuneration with effect from 15

th

December 2010:

Salary

Salary of Rs. 1,30,000/- in the Company’s Special Grade of Rs. 1,30,000 – Rs. 17,500 - Rs. 2,00,000.

Perquisites

In addition to the salary, Mr. Prahlad S. Advani shall be entitled to the following perquisites:

Category ‘A’

I. Housing:

(a) Company leased unfurnished accommodation or House Rent Allowance in lieu thereof subject to a

maximum of 60% of Salary.

(b) In case the accommodation is owned by the Company, 10% of the salary shall be deducted by the

Company.

II. Medical reimbursement:

Medical expenses reimbursement for self, spouse and family members subject to a maximum of one
month’s

salary per annum or three months’ salary over a period of three years.

III. Leave Travel Allowance:

Leave Travel Allowance for self, spouse and family members once in a year incurred in accordance with
the

Company’s rules subject to a maximum of one month’s salary per annum or two months’ salary over a
period

of two years.

IV. Insurance:

Insurance premium not exceeding 3.1% of the Salary.

V. Other allowances/reimbursements

(a) Reimbursement of Uniform, Books & Periodicals and Computer Allowance subject to a maximum of
15%

of the Salary.

4



(b) Reimbursement of Club Fees / Expenses subject to a maximum of 10% of the Salary.

(c) Reimbursement of Entertainment Expenses subject to a maximum of 12% of the Salary.

Category ‘B’

I. Provident Fund

Provident Fund / Superannuation / Annuity Fund Contributions as per the Company’s rules.

II. Gratuity

Gratuity as per the Company’s rules.

Category ‘C’

I. Car

Provision of a car with driver and petrol expenses for use of Company’s business. Use of car for personal

purposes shall be billed by the Company.

II. Telephone

Provision of telephone at residence for Company’s business purpose. Provision of Mobile phone as per

Company’s rules.

The employment can be terminated by either party by giving 90 days notice in writing.

Resolved further that the Board of Directors or any of its Committee be and is hereby authorised to
sanction

at its discretion annual increments within the scale as the Board / Committee may deem fit and proper

effective from December every year and to do all such acts, deeds, matters and things, make and
execute all

such applications, writings and instruments as the Board may in its absolute discretion deem necessary
or

desirable and delegate the said authority to any person(s) as the Board may deem fit in its discretion for
the

purpose of giving effect to this resolution.”

By Order of the Board of Directors

For Advani Hotels & Resorts (India) Limited

Place: Mumbai Kumar Iyer

Date: November 4th, 2010. Company Secretary

Registered Office:

1009/1010, Dalamal Tower,

211, Nariman Point, Mumbai - 400 021.

NOTES:

1. A MEMBER ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE
ON

A POLL INSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A MEMBER.

The Proxy Form duly completed and stamped, must be lodged at the Registered Office of the Company
not later

than 48 hours before the time fixed for the meeting.

2. The Register of Members and Share Transfer Books of the Company will remain closed from 11

th

to 15

th

December

2010 (both days inclusive).

3. Pursuant to Section 205A (5) of the Companies Act, 1956 all unclaimed dividends up to the financial
year ended

31

st

March 2001 have been transferred to the Investor Education and Protection Fund (IEPF) of the Central

Government. The details of the due dates for transfer of unpaid/ unclaimed dividend to the IEPF for the
subsequent

years are as under:

Year of Declaration Due Date (For transfer to the IEPF)

2005-2006 25-04-2013

2006-2007 21-03-2014

2007-2008 (Interim) 17-05-2015

2007-2008 (Final) 13-09-2015

4. Members who have not claimed dividend in respect of the financial year 2005 - 2006 and for the
subsequent years

are requested to approach the Company/the Registrar and Share Transfer Agents of the Company for
claiming the

same.

5


5. The particulars of the Directors seeking re-appointment are furnished below as per the provisions of
Clause 49 of

the Listing Agreement:

Name of Director (1) Mr. K. Kannan (2) Mr. Prakash V. Mehta

Date of Appointment 28.07.2003 30.06.1989

Age 71 years 68 years

Qualification FCA, ACWA LL.B. Solicitor

Expertise Finance, Banking Law

List of other Directorsh ips # 1. Kesar Enterprises Ltd. 1. Bharat Bijlee Limited

2. Patel Engineering Ltd.. 2. Hikal Ltd.

3. Consolidated Construction Consortium 3. India Safety Vaults Ltd.

Ltd. 4. JBF Industries Ltd.

4. Prithvi Asset Reconstruction Company 5. Mukand Ltd.

Ltd. 6. Mukand Engineers Ltd.

5. Heritage Foods (India) Ltd. 7. PCS Technologies Ltd.

6. Kesar Terminals & Infrastructure Ltd. 8. W.H. Brady & Co., Ltd.

Chairmanship/Membership of 1. Kesar Enterprises Ltd. 1. Bharat Bijlee Limited

other Committees of other – Member-Audit Committee – Member-Audit Committee

Companies 2. Patel Engineering Ltd. –Member-Shareholders Grievance

– Chairman-Audit Committee Committee

– Chairman-Shareholders 2. Mukand Engineers Ltd.

Grievance Committee – Member-Audit Committee

3. Consolidated Construction Consoritium 3. JBF Industries Ltd.

Ltd. – Member-Shareholders Grievance

– Member-Audit Committee Committee

4. Prithvi Asset Recons. Co. Ltd. 4. Hikal Ltd.

– Member-Audit Committee – Member-Audit Committee

5. Heritage Foods (India) Ltd. – Member-Shareholders Grievance

– Member-Audit Committee Committee

6. Subhalakshmi Polyesters Ltd. 5. Mukand Ltd.

– Member-Audit Committee – Member-Audit Committee

7. Kesar Terminals & Infra Ltd.

– Member-Audit Committee

# Excludes Directorships in Private Limited Companies, Unlimited Companies, Foreign Companies,
Section 25 Companies and Alternat e Directorships.

$ Includes only membership/s of Audit Committee and Shareholders/Investors Grievance Committee of
other Public Limited Companies .

6. The Registrar and Share Transfer Agents of the Company are:

Datamatics Financial Services Limited

Plot No. B-5, Part B, Cross Lane, MIDC Marol, Andheri (East), Mumbai - 400 093

Tel.: 91-22-6671 2237 Fax: 91-22-6671 2209

Members are requested to contact them for any matter relating to Bank details, ECS Mandates,
nominations, power

of attorney, change in name/address etc.

7. Members are requested to quote their Folio Number or the DP & Client ID on all the correspondence
with the

Company or with the Share Transfer Agents.

8. In view of the numerous advantages offered by the Depository System, members holding Shares in
physical form

are requested to avail of the facility of dematerialisation of the Company’s shares.

9. Members desirous of seeking clarifications / explanations are requested to forward their queries to
the Company at

its Registered Office at least 7 days prior to the date of the Meeting.

10. Members are requested to kindly bring their copies of the Annual Report to the Annual General
Meeting.


For Advani Hotels & Resorts (India) Limited


Date: November 4, 2010. Company Secretary

Registered Office:

1009/1010, Dalamal Tower, 211, Nariman Point, Mumbai - 400 021

6



EXPLANATORY STATEMENT PURSUANT TO SECTION 173(2) OF THE COMPANIES ACT, 1956:

ITEM NO: 5

The Special Resolution relates to the revision in the remuneration payable to Mr. Prahlad S. Advani who
has been

employed with the Company as General Manager – Asset Management since1st May, 2000. Mr. Prahlad
S. Advani is the

son of Mr. Sunder G. Advani, Chairman and Managing Director and Mrs. Menaka S. Advani, Director and
nephew of

Mr. Haresh G. Advani, Executive Director.

Mr. Prahlad Advani has completed his Bachelor of Science in Hotel Administration from Cornell
University with

concentration in Financial Management. Before joining the Company in 2000 he was employed with
Deutsche Bank Alex

Brown in U.S.A. as a Financial Analyst in the Investment Banking Division. His annual compensation was
valued at

US $ 75,000 excluding the benefits package of US $ 10,000. However, Mr. Prahlad Advani joined the
Company in May

2000 on a monthly salary of Rs. 60,000/- plus perquisites.

The members of the Company and the Central Government had consented to Mr. Prahlad S. Advani for
holding of an

office or place of profit in the Company. Accordingly, at present Mr. Prahlad S. Advani is being paid a
monthly salary of

Rs.1,10,000/- plus perquisites in accordance with Section 314 (1B) of the Companies Act, 1956.

Taking into account the qualification, experience and performance of Mr. Prahlad S. Advani and the
additional

responsibilities handled by him, the Remuneration Committee and the Board of Directors of the
Company have considered

and approved the promotion of Mr. Prahlad Advani as Vice President & Asset Manager on the revised
remuneration and

terms and conditions w.e.f. 15

th

December 2010 as contained in the resolution. The monthly salary payable to

Mr. Prahlad Advani is proposed to be increased from Rs.1,10,000/- per month to Rs.1,30,000/- per
month plus perquisites

and annual increments as specified in the resolution. Payment of remuneration to a relative of director
exceeding

Rs.50,000/- per month attracts provisions of Section 314 (1B) of the Companies Act, 1956 and requires
prior consent of

the members of the Company by way of a Special Resolution and approval of the Central Government.
The consent of

the Members is therefore being sought for the Special Resolution as proposed in the Notice. After
approval by the

Members, an application shall be made to the Central Government.

The Board feels that the increase in the remuneration is reasonable and in line with the salary offered to
other senior

managers and will be in the best interests of the Company. The Board therefore recommends the
Special Resolution for

the approval of the Members.

None of the Directors except Mr. Sunder G. Advani, Mrs. Menaka S. Advani and Mr. Haresh G. Advani is
concerned or

interested in the resolution.


For Advani Hotels & Resorts (India) Ltd,


Date: 4

th

November, 2010 Company Secretary

7


DIRECTORS’ REPORT

Dear Members,

Your Directors are pleased to present the 23

rd

Annual Report of the Company along with the audited Profit & Loss

Account for the year ended 31

st

March 2010 and the Balance Sheet as on that date.

Financial Results:

Your Company’s performance for the year ended March 31, 2010 is summarized below:

(Rs. in Lakhs)

Item Year ended Year ended

March 31, 2010 March 31, 2009

Operating Income ................................................................... 3164.31 3057.38

Other Income ........................................................................... 75.37 309.78

Total Income 3239.68 3367.16

Profit before depreciation, interest, tax and

exceptional items .................................................................... 371.40 587.22

Less: Interest............................................................................. 123.60 165.85

Profit/(Loss) before depreciation, tax and exceptional items 247.80 421.37

Less: Depreciation.................................................................... 248.98 250.86

Profit/(Loss) before tax and exceptional items .................... (1.18) 170.51

Add/(Less): Exceptional items (net) .......................................... 147.04 (222.34)

Profit/(Loss) before tax ........................................................... 145.86 (51.83)

Less: Provision for:

Current tax ...................................................................... 37.00 77.00

Deferred tax liability/(asset) ............................................ 31.96 (145.56)

Fringe Benefit tax ........................................................... — 11.58

Profit after tax .......................................................................... 76.90 5.15

Add: Profit brought forward from previous year ........................ 361.92 643.68

Less: Adjustment on adoption of AS-11 Notification ................ — 86.91

Profit available for appropriation .......................................... 438.82 561.92

Less: Dividend and tax thereon ................................................. 53.90 —

Less: Transfer to General Reserve ........................................... — 200.00

Balance Profit carried to Balance Sheet ................................... 384.92 361.92

Basic and Diluted Earnings per share (in Rs.) .......................... 0.17 0.01

Income:

The total income for the year ended 31

st

March 2010 at Rs.3240 lakhs is lower by 3.8% as compared to Rs.3367

lakhs during the previous year. However, the income from Operations for the year has gone up from
Rs.3057

lakhs to Rs.3164 lakhs even though income for the previous year included two months operational
income of the

Airport Plaza catering unit. The other income has gone down significantly during this financial year as no
dividend

income was received from the erstwhile subsidiary (Advani Pleasure Cruise Company Private Limited
[APCCPL])

as compared to Rs. 166 lakhs received in the previous financial year.

Interest and Depreciation:

Interest costs for the year ended 31

st

March 2010 stood at Rs.124 lakhs, which represents a reduction of Rs.42

lakhs or 25% over the previous year. This has been achieved by bringing down the Secured Loans from
Rs.1128

8



lakhs to only Rs.960 lakhs and the lower LIBOR rate during the year. Unsecured Loans did go up by
Rs.512

lakhs for a short period. This amount was given by the intended acquirer of APCCPL as an interest-free
loan to

facilitate renewal of the Company’s Casino Licence used by APCCPL and has since been repaid. The
Unsecured

Loans of the Company as of date stand at Rs.125 lakhs as compared to Rs.614 lakhs as on March 31,
2010.

The figures for depreciation are almost the same as no additional capital expenditures were carried out.

Profits:

The Profit for the year before tax is Rs.146 lakhs as compared to a loss of Rs.52 lakhs. Since the sale of
our

investment in APCCPL has been completed during the year, the provision made in previous year for
diminution

in value of investment in APCCPL has been reversed during the year. The net excess provision of Rs.147
lakhs

has been added to profits as exceptional item.

Consolidated Financial Results:

The Consolidated Results for this financial year include the standalone results as well as the operations
of

APCCPL. APCCPL, which was operated by Casinos Austria International had been making considerable
losses

due to competition from other new offshore casinos. Subsequently, the business operations were
suspended

from 12

th

June 2009.

The total income of APCCPL for the year 2009-10 declined to Rs.91 lakhs as against Rs.2320 lakhs during
the

previous year. The loss after tax for the year 2009-10 was Rs.1327 lakhs as against Rs 79 lakhs last year.
As

a prudent accounting policy, APCCPL has written off the assets on the leased ship M.V. Caravela
amounting to

Rs.339 lakhs in the year 2009-10. These assets were not removed from the Ship on expiry of the lease
and the

same is also included in the above loss. APCCPL has made cumulative loss of Rs.822 lakhs upto March
31,

2010 of which 51% is reflected in the consolidated accounts.

Considering the above, the Board of Directors has sold the 51% investment in APCCPL to Delta Corp Ltd.
for a

consideration of Rs.245 lakhs which sale was completed on 20

th

September 2010. APCCPL has thus ceased to

be Company’s subsidiary with effect from that date.

Dividend:

In view of the improved results and the sale of the investment in the loss-making APCCPL, the Board has

recommended a dividend of Rs.0.10 per Share (i.e. @ 5%) in respect of the financial year 2009-10 and
the same

will be paid to the shareholders subject to the approval at the Annual General Meeting.

The tax on dividends will be borne by the Company as per the Income-tax Act provisions.

Future Outlook:

The business from the foreign tourists is expected to be much higher due to increased flights into Goa
from

Russia and its neighbouring countries whose economies have not been adversely affected. There is also
an

increase in domestic traffic into Goa due to improvement in the disposable income available with
individuals and

the better performance of the corporates and the stock market. Although Indians are travelling abroad
extensively

for holidays, there is a decline in cost of air travel within India.

Your Company has maintained the sales of about Rs.1190 lakhs for the half-year despite the unexpected
heavy

rainfall in Goa and other parts of India. The net loss for the half-year has been reduced by Rs.84 lakhs.
Your

Company expects to do better than last year as occupancy rates are higher with the early start of the
foreign

season in October. The Indian economy is going to do even better and coupled with the boom in the
stock

market, domestic travel to Goa will also increase.

Renovation:

The Company managed to do a limited touch up of some of the hotel guest rooms in the period
between May and

October 2009. Since there have been some complaints of mustiness of a particular section of the hotel,
the 20

rooms in this section have been upgraded in the period between May and October 2010. A new
conference

9


facility has also been created during the above period, which will add to the revenues for the financial

year 2010-11.

Subsidiary Companies:

As informed in our Director’s Report last year, APCCPL had been making losses and the operations of the
casino

on the leased ship ‘Caravela’ had been suspended from 12

th

June, 2009. Your Company had a 51% stake in

APCCPL. The balance 49% of the equity in APCCPL was held by Casinos Austria International, who did not
wish

to provide any matching funds to cover the recurring losses. Your Company did not wish to borrow
unilaterally to

fund the negative cash flow due to competition from other Casino ships. Your Company had already
provided

substantial amounts to APCCPL unilaterally and felt it would be prudent to sell the shareholding in
APCCPL

instead of putting more funds in APCCPL over which the Company had no operational control.

On 19

th

January 2010 your Company entered into a Share Purchase Agreement (SPA) to sell the 51% stake in

APCCPL to Delta Corp Limited whereby all the funds provided to APCCPL would be returned and
liabilities as of

that date and thereafter absorbed by Delta. Subsequently, Delta wished to renegotiate the commercials
and after

protracted discussions a new SPA was signed on 20

th

September 2010. Your Company has managed to recover

most of the funds provided to APCCPL and also freed itself from the Corporate Guarantee of Rs.836.40
lakhs

given exclusively by your Company to the Bankers for a loan provided to APCCPL.

Pursuant to the sale of the 51% investment, APCCPL has ceased to be a subsidiary of the Company w.e.f.
20

th

September 2010.

The other subsidiary Company Advani Flight Catering Services Private Limited has not yet commenced
operations.

The Ministry of Corporate Affairs, New Delhi has vide its Order No. 47/373/2010-CL-III dated 17

th

May 2010

exempted the Company from the requirement of attaching the Financial statements of its subsidiaries in
terms of

Section 212(1) of the Companies Act, 1956. As per the order, a gist of the financial statements of the
subsidiary

companies has been prepared and forms part of the annual report. The accounts of the subsidiary
companies

and other detailed information will be made available to the Shareholders on request.

Directors’ Responsibility Statement:

As required by Section 217 (2AA) of the Companies Act, 1956 the Directors hereby confirm that:

(i) In the preparation of the annual accounts, the applicable accounting standards have been followed
and that

there are no material departures;

(ii) Appropriate accounting policies have been selected and applied consistently and judgments and
estimates

made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the

company at the end of the financial year and of the profit of the Company for that period;

(iii) Proper and sufficient care has been taken 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 fraud and other irregularities.

(iv) The annual accounts have been prepared on a ‘going concern’ basis.

Directors:

Mr. K. Kannan and Mr. Prakash V. Mehta, Directors of the Company, retire by rotation at the ensuing
Annual

General Meeting and are eligible for re-appointment.

Corporate Governance:

The Company has complied with the requirements regarding the Corporate Governance as required
under Clause

49 of the Listing Agreement.

The report on Management Discussion and Analysis, Corporate Governance as well as the Auditors’
Certificate

on the compliance of Corporate Governance, form part of the Annual Report.

10



Additional Information:

(a) Conservation of Energy

Energy conservation continues to receive utmost priority and the Company monitors energy costs and

reviews the consumption of energy on a regular basis. The Company wherever necessary also initiates

appropriate measures to reduce consumption of electricity.

(b) Technology Absorption

The relevant particulars relating to technology absorption in terms of Rule 2 of the Companies
(Disclosure of

Particulars in the Report of the Board of Directors) Rules 1988 is not applicable as the hotel forms a part
of

the service industry and as such the Company does not have any significant manufacturing operations.

(c) Foreign Exchange Earnings and Outgo

The Company’s foreign exchange earnings were Rs.103,564,239/- (previous year Rs.154,289,333/-)
whereas

the outgo was only Rs.49,396,473/- (previous year Rs.58,404,481/-). The relevant details are given in the

notes to Accounts.

Auditors:

M/s. J. G. Verma & Co., Chartered Accountants, Mumbai, Auditors of the Company retire at the
conclusion of

the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

Particulars of Employees:

The information required under Section 217 (2A) of the Companies Act, 1956 read with the Companies
(Particulars

of Employees) Rules, 1975 is given in the annexure.

Acknowledgment:

Your Directors thank the Company’s bankers, investors, the WYNDHAM Hotel Group International and
clientele

for their continued support during the year. Your Directors also appreciate the hard work put in by all
employees

of the Company.

For and on behalf of the Board of Directors

Place: Mumbai SUNDER G. ADVANI

Date: November 4, 2010 Chairman & Managing Director

11


ANNEXURE TO THE DIRECTORS’ REPORT

The information required under Section 217 (2A) of the Companies Act, 1956 read with the Companies
(Particulars

of Employees) Rules, 1975 and forming part of the Directors’ Report for the year ended 31

st

March 2010, is as

follows:

Employees Name Designation Age in Qualification Experience Date of Remuneration Last Employment

years in years Commence- Rupees held

ment

Mr. Sunder G. Chairman & 71 Strategic Hospitality Management 49 01.03.88 5,300,000 Chairman &

Advani Managing Financial Management Courses Managing Director,

Director Cornell University (USA) Hotel Airport Plaza

Mumbai

Masters in Business Administration

from The Wharton School (USA)

B.S. — Business Administration

Temple University (USA)

Innkeepers Diploma

Holiday Inn University (USA)

Mr. Haresh G. Executive 60 B.S. Cornell University (USA) 41 01.03.88 3,307,200 Director, Hotel

Advani Director School of Hotel Administration Airport Plaza,

Mumbai

Mr. Sanjay Vice 44 M Com. Post Graduate in 21 15.11.08 2,541,500 Managing Director,

Saxena President – Marketing Management MCI Management

Sales & (India) Pvt. Ltd.

Marketing

Notes:

1. ‘Remuneration’ includes salary, commission, allowances and taxable value of perquisites.

2. The above appointments are contractual.

3. Mr. Sunder G. Advani, Mr. Haresh G. Advani and Mrs. Menaka S. Advani are related to each other.

4. Mr. Sunder G. Advani holds 9,376,393 equity shares (20.29%) and Mr. Haresh G. Advani holds
5,709,886 equity shares (12.35%).




12



MANAGEMENT DISCUSSION AND ANALYSIS REPORT

1. DEVELOPMENTS AND OUTLOOK FOR YOUR COMPANY:

The Management Discussion and Analysis Report which is part of the Annual Report includes the
performance of

the Company and developments that may affect the likely prospects for the future. The discussion
relates to the

Company’s hotel on a standalone basis.

The last two years have been difficult ones for the world economy and the hospitality industry. The
performance of

your Company is affected by several exogenous factors such as the growth of the GDP of those countries
from

which Goa receives major portion of its tourists as well as the growth of the Indian economy. Your
Company’s 5-star

deluxe hotel relies principally on two diverse segments. Historically, your Company’s hotel has been
dependent on

the foreign market particularly tourists from Europe, who come to Goa between November and April to
escape the

harsh European winters. In recent years, there has been an increase in domestic tourists, who come to
Goa to hold

conferences, get a short holiday break or to celebrate family events such as weddings or anniversaries.

2. THE FOREIGN MARKET:

Europeans still wished to take their customary winter holidays in a warm climate. However, many,
particularly in the

UK, could not do so as they had lost or were afraid of losing their jobs and their homes as a result of the
downturn

in the UK economy. Charter flights to Goa from the UK this season were further reduced to only 6
weekly flights due

to decrease in demand. However, tourists from the UK at our resort have increased in the 2010-2011
season. The

German economy has not bounced back. There were 2 weekly flights from Germany, but due to poor
load factors,

the number of seats to Goa have been reduced in the 2010-2011 season. The only saviour last year was
the

relative strength of the economy of Russia, which provided majority of the tourists who visited Goa from
abroad. The

number of weekly charter flights from Russia and CISR to Goa is expected to go up by 50% in the coming
season.

This may not necessarily lead to a similar increase in the amount of business for the upmarket hotels, as
airlines

will need to drop rates and fill seats with low-paying passengers due to increased supply. New Russian
tour

operators have expressed an interest in Goa not only from Moscow but from other Russian cities and
the nearby

CISR States. There is also interest from Poland though there is concern that the Indian embassy in
Poland is not

issuing visas readily.

Goa is perceived as good value for money as most hoteliers have not increased their rates due to the
reduction of

foreign tourist arrivals in the winter season of 2009-10 when rooms were available even during the New
Year. The

scheduled flights to Goa started by Qatar Airways and Air Arabia will make it easier for tourists to reach
Goa.

Aeroflot, the national carrier, which had discontinued its long standing Moscow to Mumbai flights has
found it

feasible to start Moscow to Goa operations this season. More passengers are travelling by scheduled
airlines to

Goa, as the difference in cost between flying on a scheduled flight and a chartered flight is decreasing.
The work on

the new terminal at Dabolim airport with several new aero bridges has begun in full swing and this will
make it

possible to accommodate more aircrafts and passengers in Goa.

The advantage of having more foreign tourists is that they stay for an average of 10 days throughout the
six months

winter season beginning in November and ending in April when rates at all Goa hotels are higher.
Moreover, they

come to Goa to get away from the cold winters in Europe and not just for sightseeing. They are attracted
to the

beautiful beaches of Goa and the friendliness of the people as well as the pollution-free environment.
The Russians

and their neighbours from CISR countries are fond of Goa as an attractive holiday destination. The
economies of

the UK and Germany are also looking brighter. Tourists from these countries plan long distance holidays
every

year, but try to find a cheaper option in bad times. As such, it was not possible to obtain increases in the
room rates

due to decrease in demand and increase in supply of rooms, both in the lower and higher category
segments.

Moreover the strengthening of the Rupee has made our rates more expensive as our rates are quoted in
Rupees.

3. THE INDIAN MARKET:

Domestic tourists to Goa are increasing by leaps and bounds.

The continuing improved performance of the Indian economy has led to more funds available with
Corporates and

individuals for travel. Traditionally, individuals and families have always been inclined to travel overseas
as the air

fares between Delhi and Singapore / Bangkok have been close to those prevailing between Delhi and
Goa. The

new low-cost carriers with their new planes which are not yet permitted to fly overseas have been
offering very

attractive fares of-late which have contributed to the increase in domestic travel to Goa. We, in India,
like to travel

13


with our families on a holiday and the total cost of the holiday is an important consideration. Moreover,
Goa offers

something for everyone and a choice of all classes of accommodation. More direct flights to Goa have
been added

from such cities as Bangalore, Jaipur, Hyderabad and convenient connecting flights from Kolkata,
Chennai etc.

Goa as a wedding venue is becoming more popular as Goa offers a cheaper option with more flexibility
and

availability of rooms on auspicious dates.

Corporates have always preferred to hold their sales and strategy meetings in a carefree environment
where there

are few distractions. Goa has been and will continue to be a favourite destination with its closeness to
Mumbai, the

commercial capital of India and better air connectivity to the rest of India. Goa has the potential to
become the

leading center for the Meetings Incentive Conventions and Exhibitions (MICE) market, if necessary,
infrastructure is

improved.

4. RELATIVE ATTRACTIVENESS OF YOUR COMPANY’S RESORT:

Both the foreign and the Indian clients have appreciated the remarkable architecture of your Company’s
hotel. The

large beach frontage on the white sands of Varca, the best beach in Goa, has been sought out more by
the foreign

tourists who are connoisseurs of beaches. The golf course facing the ocean is another unique attraction.
The layout

of your Company’s 5 Star Deluxe Beach Resort is ideal for foreign tourists who prefer to have a large
swimming

pool with adequate surrounding deck area for sun bathing. The placement of a swim-up bar in the
centre of one of

the largest swimming pools in Goa is an added unique feature. The swimming pool and separate
children pool is

also a major attraction for corporate events and for families. The monsoon proof large Atrium lobby and
the

additional conference hall will attract more domestic business in the rainy season.

The location of the resort very close to the main railway station is also a major advantage for domestic
clients.

5. OPPORTUNITIES

Your Company’s hotel was built on one of the best beaches in Goa and close to the upmarket Leela and
Taj

Exotica hotels.

The hotel is 20-years old and is well known as the first international hotel in Goa.

The additional land purchased adjoining the hotel can be merged with the existing complex to create
new

facilities based on the demand.

The tourists from Russia are growing and the Ramada Caravela Beach Resort is well-known in that
market

having received many awards from Russian operators.

The initial cost of building has been low and the hotel can effectively compete with new hotels and offer
value for

money.

Ramada being a US brand and part of the WYNDHAM Group is likely to get more US visitors after the
Obama

visit and the improvement in US partnerships.

Increase in flights from UAE is likely to benefit our hotel, as the Ramada brand is well established in UAE.

Ramada is becoming more known in India with more hotels opening in other Indian cities.

The Government of Goa has realized the importance of the tourism industry and is successfully lobbying
for

funds from the Central Government to improve tourist infrastructure.

The airport capacity being increased will lead to more flights to Goa.

Hotels are now eligible for loans with a 15-year repayment facility. There will be increased opportunity
to borrow

for any expansion due to the low debt to equity ratio.

Leisure hotels are seeing a larger growth in the MICE market (Meeting Incentive Convention and
Exhibitions), as

it is difficult to take large groups overseas for such event – also, applies to the wedding market.

6. THREATS

Your Company has reduced the currency risk caused by the appreciation of the Rupee by quoting rates
only in

Indian rupees.

Sri Lanka is likely to take away both European and domestic tourists as the civil war has ended.

There is always some possibility of law and order problems in some part of India, which may affect
tourist flow

to Goa.

Goa is the only area where the Company has its business. Any adverse publicity for Goa can affect the
Company’s

fortunes.

The price of aviation fuel may make air travel too expensive.

Any outbreak of an infectious disease in India may impact flow of tourists.

14



7. FINANCIAL RESULTS/OPERATIONAL PERFORMANCE

The financial results of your Company, on a standalone basis and on a consolidated basis are contained
in the

Annual Report.

The operating revenues of the hotel unit increased by 8% from Rs.2,932 lakhs in F.Y. 2008-09 to Rs.3,173
lakhs for

the F.Y. 2009-10. The room revenue for the year has increased from Rs.1909 lakhs to Rs.2004 lakhs. The
average

occupancy has increased from 53% to 67% while the average rate has decreased from Rs.5028 to
Rs.4094. The

food and beverage income of hotel unit has increased by about 23%.

The Company had sold its flight catering unit in June 2008, which had made a turnover of Rs.136 lakhs in
F.Y.

2008-09 till the date of its sale. The staff cost has gone up by 6.5% as retention of experienced staff is
required in

the competitive environment. The EBITDA decreased by 37% from Rs.587 lakhs to Rs.371 lakhs mainly
due to non

receipt of any dividend from the erstwhile casino subsidiary as against Rs.166 lakhs received during the
previous

year.

The interest cost declined by almost 25% from Rs.166 to Rs.124 lakhs due to repayments of secured
loans and

lower LIBOR during the year. Depreciation has remained almost same during the year in comparison
with last year.

The profit from Ordinary Activities before Tax has remained almost the same except that there was no
dividend from

the erstwhile subsidiary during the year as against a dividend of Rs.166 lakhs in the previous year.

The profit after tax increased mainly due to reversal of the provision made for diminution in the value of
investment

as the sale of the said investment in the erstwhile subsidiary has been completed after the close of the
financial

year.

8. INTERNAL CONTROL SYSTEM AND ADEQUACY:

The internal control systems set up in terms of financial reporting, efficiency of operations and
compliance with

various rules; regulations, etc. are adequate and effective. In order to enhance the control process
further, each

department is asked by the Management to justify variances and discrepancies pointed out by the
Internal

Auditors.

The review of the adequacy of the internal control procedures and their implementation is closely
monitored by

the Audit Committee of the Board of Directors.

9. HUMAN RESOURCES:

The Company has streamlined its recruitment and selection policies while giving emphasis on retaining
the

trained staff. Continuous training is conducted during the off season period. Opportunities are given to
those with

potential to move upwards in the organization.

Accordingly, the Company has formulated various programmes like the employees reward recognition
programme

to encourage improved performance that results in greater guest satisfaction. This programme also
helps

employees to contribute towards cost saving, productivity, efficiency and better customer service. The
relations

with the employees during the year were very cordial.

10. CAUTIONARY STATEMENT

Comments made in this analysis describing the Company’s objectives, estimates may be “forward
looking

statements” within the meaning of applicable securities law. These are based on assumptions over
which the

Company exercises no controls. The Company cannot guarantee the accuracy nor can it be sure that the
results

will occur. Significant factors that can affect the Company’s operations include domestic and
international economic

conditions affecting supply and demand, law and order problems in India, change in tax and other
Government

regulations, etc.




15


REPORT ON CORPORATE GOVERNANCE

CORPORATE PHILOSOPHY:

The Company subscribes fully to the basic principles of good corporate governance, the objective of
which is to

increase productivity and competitiveness, thus maximize shareholder value. The Company continues to
adhere

to the philosophy of good Corporate Governance and believes in values of transparency,
professionalism,

accountability and is also committed to continually evolving and adopting appropriate Corporate
Governance best

practices.

BOARD OF DIRECTORS:

Composition of the Board

The Board of Directors of the Company consists of Executive and Non-Executive Directors, of whom
three are

Independent Directors who are experts in diverse fields. The Independent Directors comprise of 50% of
the total

strength of the Board of Directors of the Company. The details are as follows:

Sr. Name of the Directors Category

No.

1. Mr. Sunder G. Advani, Chairman & Managing Director Promoter Executive Director

2. Mr. Haresh G. Advani, Executive Director Promoter Executive Director

3. Mr. K. Kannan Independent Non-Executive Director

4. Mr. Prakash V. Mehta Independent Non-Executive Director

5. Mr. Anil Harish Independent Non-Executive Director

6. Mrs. Menaka S. Advani Non-Executive Director

Directors’ Attendance

During the year 2009-10, 10 (Ten) Board Meetings were held on 25.04.2009, 12.06.2009, 10.07.2009,
30.07.2009,

13.08.2009, 25.09.2009, 30.10.2009, 25.11.2009, 19.01.2010 and 29.01.2010. Majority of the Directors
attended

the Meetings. Leave of absence was granted to the Directors who expressed their inability to attend the

Meetings.

The details of attendance of Directors at the Board Meetings and at the 22

nd

Annual General Meeting as well as

the details of their other Directorships / Committee Chairmanships or Memberships are as follows:

Sr. Name of Directors Designation No. of Attendance No. of No. of other Committee

No. Board at the last Outside Chairmanships/Memberships

Meetings AGM held on Directorships (excluding the Company)

attended 25.09. 2009 # $

Chairmanship Membership

1. Mr. Sunder G. Advani Chairman &

Managing Direcor 10 Present None None None

2. Mr. Haresh G. Advani Executive

Director 10 Present None None None

3. Mr. K. Kannan Director 10 Present 7 2 6

4. Mr. Prakash V. Mehta Director 10 Present 8 None 7

5. Mr. Anil Harish Director 9 Present 13 5 7

6. Mrs. Menaka S. Advani Director 10 Present None None None

# Excludes Directorships contemplated under Section 278 of the Companies Act, 1956.

$ Includes only membership/s of Audit Committee and Shareholders/Investors Grievance Committee of
other Public Limited Companies .

16



AUDIT COMMITTEE:

The composition of the Committee and particulars of meetings attended by the Members of the Audit
Committee

are as under. During the year under review, 5 meetings of the Audit Committee were held on
25.04.2009,

30.07.2009, 13.08.2009, 30.10.2009 and 29.01.2010.

Sr. Name of the Member Designation No. of Committee Meetings attended

No. in the year under review

1. Mr. K. Kannan Chairman 5

2. Mr. Prakash V. Mehta Member 5

3. Mrs. Menaka S. Advani Member 5

The Audit Committee comprises of only Non-Executive Directors of which two-thirds are Independent
Directors.

The constitution of the Audit Committee also meets the requirements of the provisions of Section 292A
of the

Companies Act, 1956.

The Scope and broad terms of reference of the Audit Committee are as follows:

— To oversee the Company’s financial reporting process and disclosure of its financial information.

— To recommend the appointment of Statutory Auditors and fixation of remuneration.

— To review and discuss with the Auditors about internal control systems, the scope of audit including
the

observations of the Auditors, adequacy of internal audit functions, major accounting policies, practices
and

entries, compliance with accounting standards and with the Stock Exchanges and legal requirements

concerning financial statements and related party transactions, if any.

— To review the Company’s financial and risk management policies and discuss with the internal
auditors.

— To follow-up significant findings thereon.

— To review the quarterly, half yearly and annual financial statements before submission to the Board
of

Directors.

— To investigate into any matter relating to the items specified in Section 292A of the Companies Act,
1956, or

as may be referred to by the Board and for this purpose to seek any relevant information contained in
the

records of the Company and also to seek professional advice, if necessary.

— To obtain external advice, legal or other professional advice.

— To secure attendance of outside parties with relevant expertise, if it considers necessary.

— To seek information from any employee

REMUNERATION COMMITTEE:

The composition of the Remuneration Committee and particulars of meetings attended by the Members
of the

Remuneration Committee are as under. The Committee approves the annual salaries, performance
commission,

service agreements and other employment conditions of the Executive Directors and relatives of the
Directors.

During the year under review one Meeting of the Remuneration Committee was held on 12.06.2009.

Sr. Name of the Member Designation No. of Committee Meetings attended

No. in the year under review

1. Mr. K. Kannan Chairman 1

2. Mr. Anil Harish Member 1

3. Mrs. Menaka S. Advani* Member 0

4. Mr. Prakash V. Mehta Member 1

* Resigned w.e.f. 4/11/2010

17


The scope and broad terms of reference of the Remuneration Committee are as follows:

— To review, assess and recommend the appointment of Executive and Non-Executive Directors and
relative

of Directors from time to time;

— To periodically review the remuneration package of the Executive Directors, relative of Director and
recommend

suitable revision;

— To recommend compensation to the Non-Executive Directors in accordance with the Companies Act,
1956.

DETAILS OF REMUNERATION PAID TO THE EXECUTIVE DIRECTORS DURING THE YEAR ENDED

MARCH 31, 2010.

Sr. Name of the Director Salary Perquisites Commission Service Notice

No. (Basic + HRA) Tenure Period

Rs. Rs. Rs.

1. Mr. Sunder G. Advani 48,00,000 5,00,000 0 5 years 3 months

Chairman & Managing Director

2. Mr. Haresh G. Advani 29,95,200 3,12,000 0 5 years 3 months

Executive Director

DETAILS OF SITTING FEES PAID TO NON-EXECUTIVE DIRECTORS DURING THE YEAR ENDED

MARCH 31, 2010.

Name of the Director Mr. K. Kannan Mr. Prakash V. Mehta Mr. Anil Harish Mrs. Menaka S. Advani

Sitting Fees Paid (Rs.) 3,20,000 3,20,000 2,00,000 3,00,000

SHAREHOLDERS/INVESTORS GRIEVANCE COMMITTEE:

The Committee comprises of the following two Non-Executive Directors and two Executive Directors:

Sr. Name of the Member Designation

No.

1. Mrs. Menaka S. Advani Chairperson & Non-Executive Director

2. Mr. Sunder G. Advani Member & Managing Director

3. Mr. Haresh G. Advani Member & Executive Director

4. Mr. K. Kannan Member & Non-Executive Independent Director

The Company has constituted a Shareholders/Investors Grievance Committee to look into the Redressal
of

complaints of shareholders and investors relating to transfer of shares, non-receipt of Annual report,
dividends

etc. The Chairperson of the Committee is a Non-Executive Director.

The Board has designated Mr. Kumar Iyer, Company Secretary as the Compliance Officer.

The Company Secretary acts as the Compliance Officer and regularly interacts with the Registrar & Share

Transfer Agents (RTA) to ensure that the complaints/ grievances of the shareholders/investors are
attended to

without delay and where deemed expedient, the complaints are referred to the Chairperson of the
Committee or

discussed at its meetings.

During the year under review one meeting of the Shareholders/Investors Grievance Committee was held
on 30

th

October, 2009.

During the year under review, the Company received 27 shareholder complaints, which were promptly
responded

to and resolved to the satisfaction of the respective shareholders and as on 31.03.2010 there were no
pending

complaints.

18



SHARE TRANSFER COMMITTEE:

The Committee comprises of the following two Executive Directors:

Sr. No. Name of the Member Designation

1. Mr. Sunder G. Advani Member & Managing Director

2. Mr. Haresh G. Advani Member & Executive Director

The Share Transfer Committee looks into the approval of share transfers, transmissions, issue of
duplicate share

certificates etc.

GENERAL BODY MEETINGS AND POSTAL BALLOT:

Annual General Meetings held during the last 3 years

Particulars FY 2008-09 FY 2007-08 FY 2006-07

Date 25.09.2009 28.08.2008 26.09.2007

Location ‘Rangaswar’, 4th Floor, Kamalnayan Bajaj Hall, Seminar Hall of K.C. College

Chavan Centre, Ground Floor, Bajaj Bhavan, Dinshaw Wachha Road,

Gen. Jagannath Bhosale Marg, Jamnalal Bajaj Marg, Churchgate,

Nariman Point, Nariman Point, Mumbai-400 020

Mumbai-400 021 Mumbai-400 021

Time 11.00 a.m. 11.00 a.m. 3.00 p.m.

All the Resolutions as set out in the respective notices were passed unanimously by a show of hands by
the

Members of the Company present at the said Annual General Meetings.

The Company has not conducted any business through postal ballot during the year under review.

DISCLOSURES:

➢ During the year, the Company has not entered into any material significant related party transactions
with

its Directors/Promoters that may have potential conflict with the interest of the Company at large. As

required by the Accounting Standard AS-18, the details of Related Party Transactions are given in the

Notes to the Accounts.

➢ There was no instance of non-compliance on any matter relating to the capital markets during the
past three

years.

➢ The Company has complied with all the mandatory requirements of Clause 49 relating to Corporate

Governance except Clause 49 (III) (i) due to the resignation of the Company’s Independent Director from

the board of it’s subsidiary Advani Pleasure Cruise Company Private Limited (APCCPL) w.e.f.12

th

June

2009. The said APCCPL has ceased to be the Company’s subsidiary w.e.f. 20

th

September 2010.

➢ Pursuant to the provisions of Sub-Clause V of Clause 49 of the Listing Agreement with the Stock

Exchanges, the Chairman & Managing Director (CMD) and the General Manager Finance (CFO) have

issued a Certificate to the Board, for the financial year ended March 31, 2010.

MEANS OF COMMUNICATION:

➢ The Company communicates with the shareholders at large through its Annual Report, publication of

financial results, press releases and by submission and filing of reports and returns with the stock

exchanges and all statutory bodies.

➢ The Financial results are usually published in the ‘Business Standard’ and/or ‘The Free Press Journal’

(in English) and ‘Navshakti’ or ‘Sakal’ (in Marathi).

➢ Management Discussion and Analysis Report forms part of this Annual Report.

19


STATUS OF COMPLIANCE WITH NON-MANDATORY REQUIREMENTS:

(a) Remuneration Committee:

The Company has a Remuneration Committee, the details whereof are furnished above in this Report.

(b) Tenure of Independent Directors:

The Board has not laid down any specific maximum tenure for the Independent Directors.

(c) Training of Board Members:

The Directors of the Company are senior professionals of high standing and experience in corporate
sector

and the industry in which the Company operates. They are being kept informed of the business model,

growth factors and the risk profile of the Company. Hence, the Company has not laid down any formal

training mechanism for its Directors.

(d) Whistle Blower Policy:

Though the Company does not have a formal Whistle Blower Policy, the Company takes cognizance of

complaints made and suggestion given by the employees and others. Even anonymous complaints are

looked into and whenever necessary, suitable corrective steps are taken. The Company promotes ethical

behaviour in all its business activities. All employees are free to approach the Audit Committee to raise
their

concern relating to fraud, malpractice or any other activity or event which is against the Company’s
interest.

GENERAL SHAREHOLDERS INFORMATION:

➢ 23rd Annual General Meeting

Date & Time : Wednesday, December 15, 2010 at 11.00 a.m.

Venue : Rangaswar, 4th Floor, Chavan Centre, General Jagannath Bhosale Marg,

Nariman Point, Mumbai - 400 021

➢ Financial Calendar

Results for the Quarter ended June 30, 2010 August 12, 2010

Results for the Quarter ending Sept. 30, 2010 November 4, 2010

Annual General Meeting December 15, 2010

Results for the Quarter ending Dec. 31, 2010 Second week of February, 2011

Results for the Quarter ending March 31, 2011 Second week of May, 2011

➢ Date of Book Closure

From December 11, 2010 to December 15, 2010 (both days inclusive) for the purpose of payment of

Dividend for the year 2009-10 and Annual General Meeting for the financial year ended March 31, 2010.

➢ Listing on Stock Exchange

Bombay Stock Exchange Limited (Stock Code – 523269)

National Stock Exchange of India Limited (Stock Symbol – ADVANIHOTR)

Delhi Stock Exchange Association Limited (Stock Code – 5924)

➢ Market Price Data

The high and low Market Price of the Company’s shares traded on the Bombay Stock Exchange Limited,

during each month in the financial year ended March 31, 2010 are given below.

Month High Low Close Price Month High Low Close Price

Rs. Rs. Rs. Rs. Rs. Rs.

April’ 09 31.85 26.35 27.55 October’09 61.15 54.55 56.50

May’ 09 39.45 27.35 39.45 November’09 59.55 49.20 50.10

June’ 09 50.00 37.10 40.85 December’09 57.00 49.25 55.10

July’ 09 41.85 36.00 38.25 January’10 64.90 50.00 53.10

August’ 09 44.10 32.00 44.10 February’10 56.45 47.00 49.80

September’ 09 71.65 46.30 59.25 March’10 50.00 38.50 40.10

20



➢ Performance of Company’s share price in comparison to BSE Sensex

AHRIL Share Price / BSE Sensex From April 2009 to March 2010

17528

16430

16358

17465

16926

15896

17 12 7

15667

15670

14625

114 0 3

14494

40.10

49.80

53.10

55.10

50.10

56.50

59.25

44.10

38.25

40.85

39.45

27.55

0

5,000

10,000

15,000

20,000

Apr'09 May'09 June'09 July'09 Aug'09 Sept'09 Oct'09 Nov'09 Dec'09 Jan'10 Feb'10 Mar'10

BSE Sensex

10

60

110

AHRIL Closing Price at the end of month (Rs.)

BSE Sensex AHRIL Share Prices

➢ Registrar and Share Transfer Agent

Datamatics Financial Services Limited

(Unit: Advani Hotels & Resorts (India) Limited)

Plot No. B5, Part B, Cross Lane,

MIDC Marol, Andheri (East), Mumbai - 400 093.

Telephone No: (022) 66712237 Fax No: (022) 66712209

Contact Person: Mr. Salim Shaikh

➢ Share Transfer System

The Share Transfer Committee constituted by the Board considers and approves all shares related issues

like transfer, transmission, issue of duplicate shares, dematerialization, etc. The transfer formalities are

attended to on fortnightly basis by Datamatics Financial Services Ltd. All the share certificates are
returned

within 21 days from the date of lodgment provided the transfer instruments are valid and complete in
all

respects.

➢ Distribution of Shareholding as on March 31, 2010

Range No. of % of No. of % of

(No. of Shares) Shareholders Total Shares Total

1-500 3,630 66.85 13,13,722 2.84

501-1000 926 17.05 8,66,822 1.88

1001-2000 396 7.29 6,31,995 1.37

2001-3000 217 4.00 5,57,051 1.20

3001-4000 46 0.85 1,69,447 0.37

4001-5000 90 1.66 4,41,538 0.96

5001-10000 55 1.01 4,25,977 0.92

10001 and above 70 1.29 4,18,12,698 90.46

Total 5,430 100.00 4,62,19,250 100.00

21


➢ Category of Shareholding as on March 31, 2010

Category No. of Shares % of Total

Promoters & Promoter Group 2.29,91,579 49.74

Mutual Funds 58,500 0.13

Bank/FIs/Insurance Companies 2,500 0.01

Foreign Institutional Investors 1,36,982 0.29

Corporate Bodies Corporate 1,75,29,788 37.93

NRIs/OCBs 7,50,542 1.62

General Public 47,49,359 10.28

Total 4,62,19,250 100.00

➢ Shares held by Non-Executive Directors

Sr. No. Non-Executive Directors No. of Shares held as on 31-03-2010

1. M. K. Kannan NIL

2. Mr. Prakash V. Mehta 500

3. Mr. Anil Harish NIL

4. Mrs. Menaka S. Advani 13,05,630

➢ Demat of shares and liquidity

The Company’s shares are held in the dematerialized form by National Securities Depository Limited and

the Central Depository Services (India) Limited under the ISIN No. INE199C01026. Out of the total Equity

Share Capital, 93.50% is held in dematerialised form as on March 31, 2010. Trading in Equity Shares of
the

Company is permitted only in dematerialised form w.e.f. 28.05.2001 as per the Notification issued by
the

SEBI.

➢ As on date the Company has not issued GDRs/ADRs/Warrants or any other convertible instruments.

➢ Location

Hotel

Ramada Caravela Beach Resort

Varca Beach, Varca Village, Salcette, Goa – 403 721

Telephone No: (0832) 6695000

➢ Address for Correspondence

Advani Hotels & Resorts (India) Limited

1009/1010, Dalamal Tower,

211, Nariman Point, Mumbai – 400 021

Telephone No: (022) 2285 0101 Fax No: (022) 2204 0744

Email ID: cs.ho@advanihotels.com

CODE OF CONDUCT:

The Board of Directors of the Company has laid a code of conduct for the Directors and senior
management. The

code of conduct is posted on the Company’s website. All Directors and designated personnel in the
senior

management have affirmed compliance with the code for the year under review.



Date: November 4, 2010. Chairman & Managing Director

22



AUDITORS’ CERTIFICATE ON CORPORATE GOVERNANCE

To the Members of

Advani Hotels & Resorts India Limited

We have examined the compliance of Corporate Governance of ADVANI HOTELS & RESORTS (INDIA)

LIMITED for the year ended 31

st

March 2010 as stipulated in Clause 49 of the Listing Agreement of the said

Company with stock exchanges.

The compliance of conditions of Corporate Governance is the responsibility of the management. Our
examination

was limited to procedures and implementation thereof, adopted by the Company for ensuring the
compliance of

the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the
financial

statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us and the

representations made by the Directors and the Management, we certify that the Company has complied
with the

conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement except
Clause 49

(III) (i) due to the resignation of the Company’s independent director from the board of it’s subsidiary
Advani

Pleasure Cruise Company Private Limited (APCCPL) w.e.f. 12

th

June 2009. The said APCCPL has ceased to be

the Company’s subsidiary w.e.f. 20

th

September 2010 .

We state that no investor grievances are pending for a period exceeding one month against the
Company as per

the records maintained by the Share Transfer and Shareholders / Investors Grievance Committee.

We further state that such compliance is neither an assurance as to the future viability of the Company
nor the

efficiency or effectiveness with which the Management has conducted the affairs of the Company.

For J.G. VERMA & CO.


Registration No. 111381W

J.G. VERMA

Place: Mumbai Partner

Date: November 4, 2010 Membership No. 5005

23


AUDITORS’ REPORT TO THE MEMBERS

We have audited the attached Balance Sheet of ADVANI HOTELS & RESORTS (INDIA) LIMITED, as at

31

st

March, 2010 and also the Profit and Loss Account and the Cash Flow Statement of the Company for

the year ended on that date annexed thereto. These financial statements are the responsibility of the

Company’s management. Our responsibility is to express an opinion on these financial statements based
on

our audit.

We conducted our audit in accordance with auditing standards generally accepted in India. Those
standards

require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements

are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the

amounts and disclosures in the financial statements. An audit also includes assessing the accounting
principles

used and significant estimates made by management, as well as evaluating the overall financial
statement

presentation. We believe that our audit provides a reasonable basis for our opinion.

As required by the Companies (Auditor’s Report) Order, 2003, issued by the Central Government of India
in terms

of sub-section (4A) of Section 227 of the Companies Act, 1956, and on the basis of such checks as we

considered appropriate, we enclose in the Annexure a statement on the matters specified in paragraphs
4 and 5

of the said Order.

Further to our comments in the Annexure referred to above, we report that:

1. We have obtained all the information and explanations, which to the best of our knowledge and
belief were

necessary for the purpose of our audit.

2. In our opinion, proper books of account as required by law have been kept by the Company so far as

appears from our examination of those books.

3. The Balance Sheet, Profit and Loss Account and Cash Flow Statement, dealt with by this Report, are in

agreement with the books of account.

4. In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement comply with the

applicable Accounting Standards referred to in sub-section (3-C) of Section 211 of the Companies Act,

1956.

5. On the basis of written representations received from the Directors of the Company and taken on
record by

the Board of Directors, we report that none of the directors of the Company is disqualified as on 31

st

March,

2010 from being appointed as a director under clause (g) of sub-section (1) of Section 274 of the

Companies Act, 1956.

6. In our opinion and to the best of our information and according to the explanations given to us, the
said

accounts, read together with the significant accounting policies stated in Schedule “K” and the other

notes appearing thereon, give the information required by the Companies Act, 1956, in the manner so

required and give a true and fair view in conformity with the accounting principles generally accepted in

India:

(i) in the case of the Balance Sheet, of the state of the affairs of the Company as at 31st March, 2010;

(ii) in the case of Profit and Loss Account, of the profit of the Company for the year ended on that date;

and

(iii) in the case of Cash Flow Statement, of the cash flows of the Company for the year ended on that

date.

For J.G. VERMA & CO.



J.G. VERMA

Place: Mumbai Partner

Date: November 4, 2010 Membership No. 5005

24



ANNEXURE REFERRED TO IN OUR REPORT OF EVEN DATE

1. (a) The Company has maintained proper records showing full particulars including quantitative details
and situation

of its fixed assets.

(b) The fixed assets were physically verified during the year and after the close of the year by the
management. No

material discrepancies were noticed by the Management on such physical verification as compared to
book

records.

(c) In our opinion, the Company has not disposed off a substantial part of its fixed assets during the year
and the

going concern status of the Company is not affected.

2. (a) The inventories have been physically verified during the year by the management. In our opinion,
the frequency

of verification is reasonable;

(b) The procedures of physical verification of inventories followed by the management are reasonable
and adequate

in relation to the size of the Company and the nature of its business.

(c) On the basis of our examination of the inventory records of the Company, we are of the opinion that
the

Company is maintaining proper records of inventory. Discrepancies, which were noticed on physical
verification

of inventory as compared to book records, were not material and have been properly dealt with in the
books of

account.

3. (a) The Company has not granted any loan or advance to companies, firms or other parties covered in
the Register

maintained under section 301 of the Companies Act, 1956 except an interest free advance of Rs.
90,908,724/-(maximum balance Rs. 119,416,887/-) being amount due on current account from one of
its subsidiaries, out of

which Rs. 25,315,947/- is considered doubtful of recovery and provided for.

(b) The terms and conditions of above interest free advance given are prima facie not prejudicial to the
interest of

the Company except to the extent indicated in 3(a) above.

(c) According to the information and explanations given to us, there is no stipulation for repayment of
the above

advance given by the Company to its subsidiary. However, the entire amount except Rs. 25,315,947/-
which is

considered doubtful by the Management has since been recovered after the close of the year.

(d) In view of our comment in paragraph 3 (c) above, clause III (d) of paragraph of the aforesaid Order is
not

applicable to the Company.

(e) The Company has not taken any loan, secured or unsecured, during the year from companies, firms
and other

parties covered in the Register maintained under Section 301 of the Companies Act, 1956. In view of the
same,

our comments on clauses III (f) and (g) of paragraph (4) of the aforesaid Order are not applicable to the

Company.

4. In our opinion, and according to the information and explanations given to us, there is an adequate
internal control

system commensurate with the size of the Company and the nature of its business for the purchase of
inventory and

fixed assets and for the sale of goods and services. During the course of our audit, no major weaknesses
have

been noticed in the internal control system.

5. To the best of our knowledge and belief and according to the information and explanations given to
us, (a) the

particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have
been entered

in the register required to be maintained under that section; and (b) such transactions exceeding the
value of

Rupees five lacs in respect of any party during the year have been made at prices, which are reasonable
having

regard to prevailing market prices at the relevant time.

6. The Company has not accepted any deposits from the public within the meaning of Section 58A 58AA
and other

provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975. Hence
the

clause (vi) of the Order is not applicable to the Company.

7. In our opinion, the internal audit functions carried out during the year by a firm of Chartered
Accountants appointed

by the Management have been commensurate with the size of the Company and nature of its business.

8. The maintenance of cost records has not been prescribed by the Central Government under Section
209(1)(d) of

the Companies Act, 1956 for any of the products of the Company.

9. (a) According to the records of the Company and the information and explanations given to us, the
Company has

been generally regular in depositing undisputed statutory dues, including provident fund, investor
education &

protection fund, employees’ state insurance, income-tax, sales-tax, wealth-tax, service tax, customs
duty, excise

duty, cess and other applicable statutory dues with the appropriate authorities during the year . The
Company’s

operations do not give rise to any excise duty liability.

25


(b) According to the information and explanations given to us, there are no undisputed amounts payable
in respect

of undisputed statutory dues as at 31

st

March, 2010 which were outstanding for a period of more than six months

from the date they became payable.

(c) According to the information and explanations given to us and on the basis of our examination of the
documents

and records, there are no cases of non-deposit with appropriate authorities of disputed dues of income-
tax,

sales-tax, wealth tax, service tax, customs duty, excise duty, cess except the following:

Name of the Nature of dues Amount Period to which Forum where the

statute (Rs. in lakhs) the amount dispute is

relates pending

Central Sales Tax Act, Central Sales tax 12.16 Asst. Years Asst. Commissioner

1956 2005-06 to of Commercial Tax

2006-07 (Value Added Tax)

Income-tax Act, 1961 Income-tax on 10.66 Asst. Years Income-Tax

completion of 2005-06 Appellate Tribunal

regular assessment

10. The Company neither had accumulated losses at the end of the financial year nor incurred any cash
losses either

during the financial year or preceding financial year.

11. According to the records of the Company examined by us and the information and explanations
given to us, the

Company has not defaulted in repayment of dues to banks as per loan agreements or extended due
dates There

were no borrowings from any financial institutions or by way of debentures.

12. According to the information and explanations given to us, the Company has not granted loans and
advances on

the basis of security by way of pledge of shares, debentures and other securities.

13. The provisions of any special statute applicable to chit fund/nidhi/mutual benefit fund / societies are
not applicable

to the Company.

14. The Company is not a dealer or trader in shares, securities, debentures, and other investments.

15. According to the information and explanations given to us, the Company has given guarantee for
loan taken by its

one of the subsidiaries from a bank, the terms and conditions whereof, in our opinion, are not prima
facie prejudicial

to the interest of the Company. The said guarantee has since been extinguished after the close of the
year.

16. In our opinion on an overall basis, and according to the information and explanations given to us, the
term loans

taken during the year were applied for the purpose for which the loans were obtained.

17. According to the information and explanations given to us and on an overall examination of the
Balance sheet of

the Company, we report that funds raised on short term basis have prima facie, not been used during
the year for

long term investment.

18. The Company has not made any preferential allotment of shares to parties and companies covered
in the Register

maintained under section 301 of the Companies Act, 1956.

19. The Company has not issued any debentures during the year under audit. Accordingly, the provisions
of clause

(XIX) of paragraph 4 of the aforesaid Order are not applicable to the Company.

20. The Company has not raised money by public issue during the year. Accordingly, the provisions of
clause (XX) of

paragraph 4 of the aforesaid Order are not applicable to the Company.

21. To the best of our knowledge and belief, and according to the information given to us, no fraud on
or by the

Company was noticed or reported during the year.

For J.G.VERMA & CO.



J.G.VERMA

Partner

Mumbai, November 4, 2010 Membership No. 5005

26



BALANCE SHEET AS AT 31ST MARCH, 2010

Previous Year

SOURCES OF FUNDS: Schedule Rupees Rupees Rupees

SHAREHOLDERS’ FUNDS:

Share Capital.................................................................... ‘A’ 92,438,500 92,438,500

Reserves and Surplus ...................................................... ‘B’ 200,437,464 198,137,495

292,875,964 290,575,995

LOAN FUNDS:

Secured Loans ................................................................. ‘C’ 95,952,256 112,836,915

Unsecured Loans............................................................. ‘D’ 61,452,388 12,580,644

157,404,644 125,417,559

DEFERRED TAX LIABILITY (Net) ...................................... 53,561,105 50,364,744

TOTAL................ 503,841,713 466,358,298

APPLICATION OF FUNDS:

FIXED ASSETS: ‘E’

Gross Block (At cost) ............................................................. 666,129,004 669,775,597

Less: Depreciation ............................................................ 244,862,538 225,149,888

Net Block ........................................................................... 421,266,466 444,625,709

Capital Work in Progress ................................................. 363,682 1,785,841

421,630,148 446,411,550

INVESTMENTS ..................................................................... ‘F’ 22,285,000 100,000

FOREIGN CURRENCY MONETARY ITEMS TRANSLATION

DIFFERENCE: ....................................................................... 126,174 1,802,657

CURRENT ASSETS, LOANS AND ADVANCES: ‘G’

Interest accrued ................................................................ 14,755 —

Stock .................................................................................. 13,598,464 15,916,533

Sundry Debtors ................................................................. 21,364,352 17,497,077

Cash and Bank Balances ................................................ 8,840,212 14,408,888

Loans and Advances ....................................................... 92,688,368 38,679,658

136,506,151 86,502,156

LESS: CURRENT LIABILITIES AND PROVISIONS: ‘H’

Current Liabilities............................................................. 65,537,428 63,045,329

Provisions .......................................................................... 11,168,332 5,412,736

76,705,760 68,458,065

NET CURRENT ASSETS ..................................................... 59,800,391 18,044,091

TOTAL................ 503,841,713 466,358,298

SIGNIFICANT ACCOUNTING POLICIES AND

NOTES ON ACCOUNTS...................................................... ‘K’

As per our report of even date Signature on the above Balance Sheet and Schedules “A” to “H” and “K”

For and on behalf of the Board

FOR J. G. VERMA & CO. SUNDER G. ADVANI HARESH G. ADVANI

Chartered Accountants Chairman & Managing Director Executive Director

J. G. VERMA KUMAR IYER SHANKAR KULKARNI

Partner Company Secretary General Manager – Finance (CFO)

Mumbai, November 4, 2010

27


PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2010

Previous Year

Schedule Rupees Rupees Rupees

INCOME:

Rooms, Restaurant, Bar, Banquets, Flight Catering

and Other Services..................................................................... ‘I’ 316,431,527 305,738,143

Other Income.............................................................................. ‘I’ 7,536,532 30,978,274

Total................................................................................... 323,968,059 336,716,417

EXPENDITURE:

Operating and General Expenses ............................................. ‘J’ 278,220,801 269,440,925

Managerial Remuneration (Refer Note 15(i)(a) of Part B of Shedule ‘K’) 8,607,200 8,553,738

Depreciation ................................................................................. 24,898,280 25,086,088

Interest:

(a) On Fixed Loans ............................................................... 9,944,553 14,354,585

(b) On Other Loans ............................................................... 2,415,611 2,230,328

12,360,164 16,584,913

Total Expenditure ............................................................ 324,086,445 319,665,664

PROFIT/(LOSS) BEFORE EXCEPTIONAL ITEMS .................... (118,386) 17,050,753

Less: Exceptional Items (Net) ......................................................... ‘J-1’ 14,704,285 (22,234,243)

PROFIT/(LOSS) BEFORE TAXATION......................................... 14,585,899 (5,183,490)

Less: Provision for taxation

Current tax.................................................................................. 3,700,000 7,700,000

Fringe Benefits tax ...................................................................... — 1,158,000

Deferred tax Liability/(Asset) ...................................................... 3,196,361 (14,556,203)

6,896,361 (5,698,203)

7,689,538 514,713

PROFIT FOR THE YEAR AFTER TAX

Profit brought forward ................................................................. 36,192,312 64,368,446

Less: Adjustment on adoption of AS-11 Notification ...................... — 8,690,847

36,192,312 55,677,599

43,881,850 56,192,312

PROFIT AVAILABLE FOR APPROPRIATION:

Less: Appropriations made:

Proposed Dividend ................................................................ 4,621,925 —

Tax on Dividend ..................................................................... 767,644 —

5,389,569 —

Transfer to General Reserve — 20,000,000

5,389,569 20,000,000

Balance Profit carried to Balance Sheet ......................................... 38,492,281 36,192,312

Basic and Diluted Earnings Per Share (In Rs.) ........................ 0.17 0.01

Face value Rs. 2/- per share (Refer note 13 of Part B of Schedule “K”)

SIGNIFICANT ACCOUNTING POLICIES AND

NOTES ON ACCOUNTS .......................................................... ‘K’

As per our report of even date Signature on the above Profit and Loss Account and Schedules “I” to “K”







28



CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2010

31st March, 2010 31st March, 2009

Rupees Rupees

A. CASH FLOW FROM OPERATING ACTIVITIES:

Net Profit/(Loss) before tax and adjustments .................................................................... 14,585,899
(5,183,490)

Adjustments for:

Depreciation .......................................................................................................................... 24,898,280
25,086,088

Loss on sale of assets........................................................................................................ 1,286,652
2,187,818

Profit on sale of Flight kitchen ............................................................................................. — (
37,544,603)

Duty Free Entitlement .......................................................................................................... — (1,310,285)

Provision for doubtful debts ................................................................................................. 166,977
1,945,163

Provision for incomplete Jaipur Project .............................................................................. — 11, 958,615

Provision for diminution in value of investment/(written back) .......................................... (22,185,000)
22,185,000

Provision for doubtful Loans & Advances/(written back) .................................................. (319,285)
25,635,231

Provision for liability for refund of Jetty Deposit................................................................ 7,800,000 —

Provision for retirement benefits/(written back) ................................................................. 366,027
(1,440,805)

Interest and Dividend Income ............................................................................................ (165,552)
(17,925,978)

Interest ............................................................................................................................... ... 12,360,164
16,584,913

Amortisation of Foreign Exchange Difference.................................................................... 126,174
901,328

Operating profit before working capital changes: .................................................... 38,920,336
43,078,995

Adjustments for:

Trade and other receivables............................................................................................... (4,034,252)
25,072,586

Inventories ............................................................................................................................ 2,318,069
2,517,631

Trade payable ....................................................................................................................... 2,727,531
(12,719,754)

Cash generated from operations: ................................................................................. 39,931,684
57,949,458

Direct Taxes paid (Net of refund received) ....................................................................... (9,215,598)
(48,294,910)

Cash Flow before Extraordinary Items: ....................................................................... 30,716,086
9,654,548

Extraordinary Items.............................................................................................................. — —

Net cash from Operating Activities: ............................................................................. 30,716,086
9,654,548

B. CASH FLOW FROM INVESTMENT ACTIVITIES:

Purchase of Fixed Assets (including Capital Work-in-progress): .................................... (10,617,455)
(17,011,269)

Increase in Loans, Advances and deposits ....................................................................... (55,944,304)
(40,619,232)

Disposal of Investment ........................................................................................................ — 100,500

Net sale consideration of Flight Kitchen Unit ..................................................................... — 197,785,026

Sale of Fixed Assets ............................................................................................................ 427,443
133,266

Interest and Dividend Received .......................................................................................... 165,552
17,942,888

Net Cash (used in)/ from Investing Activities ............................................................ (65,968,764)
158,331,179

C. CASH FLOW FROM FINANCING ACTIVITIES:

Proceeds from Borrowings:

Term Loans .......................................................................................................................... 11,344,085
3,593,946

Unsecured Loans................................................................................................................. 51,250,000
7,912,451

Cash Credits ......... ................................................................................................................ 16,155,572 —

Repayment of :

Term Loans .......................................................................................................................... (34,214,464)
(104,334,592)

Cash Credit ........................................................................................................................... — (18,875,702)

Unsecured Loans................................................................................................................. (2,378,256)
(2,642,402)

Interest Paid .................................................................................................................. ........ (12,449,920)
(17,441,520)

Dividend paid for earlier years including Dividend Tax ..................................................... (23,015)
(29,258,614)

Net Cash (used in)/from Financing Activities ............................................................ 29,684,002
(161,046,433)

NET INCREASE/(DECREASE) IN CASH & CASH EQUIVALENTS (A+B+C) ................... (5,568,676) 6,939,294

CASH & CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR (Opening Balance) .. 14,408,888 7,469,594

CASH & CASH EQUIVALENTS AT THE CLOSING OF THE YEAR (Closing Balance) ... 8,840,212 14,408,888

As per our report of even date Signature on the above Cash Flow Statement







29


SCHEDULES FORMING PART OF THE BALANCE SHEET AS AT 31ST MARCH, 2010

Previous Year

Rupees Rupees Rupees

SCHEDULE “A” : SHARE CAPITAL

AUTHORISED:

99,750,000 Equity Shares of Rs. 2/- each ...................................... 199,500,000 199,500,000

5,050,000 Preference Shares of Rs. 10/- each .............................. 50,500,000 50,500,000

TOTAL 250,000,000 250,000,000

ISSUED, SUBSCRIBED AND PAID UP:

46,219,250 Equity Shares of Rs. 2/- each, fully paid up .................. 92,438,500 92,438,500

TOTAL 92,438,500 92,438,500

SCHEDULE “B” : RESERVES AND SURPLUS

CAPITAL RESERVE:

As per last accounts:

Subsidy received under the Central Investment subsidy scheme

of the Government of Goa ............................................................... 2,500,000 2,500,000

Share Premium Account .................................................................. 47,089,900 47,089,900

Profit on re-issue of forfeited shares ............................................... 14,000 14,000

Surplus being capital gain on sale of flight catering unit ............ 82,341,283 82,341,283

131,945,183 131,945,183

CAPITAL REDEMPTION RESERVE

As per last accounts ......................................................................... 10,000,000 10,000,000

GENERAL RESERVE

As per last accounts:........................................................................ 20,000,000 6,390,000

Less: Adjustment on adoption of AS-11 Notification .................... — 6,390,000

20,000,000 —

Add: Set aside this year ................................................................... — 20,000,000

20,000,000 20,000,000

SURPLUS IN PROFIT AND LOSS ACCOUNT 38,492,281 36,192,312

TOTAL 200,437,464 198,137,495

SCHEDULE “C” : SECURED LOANS

FROM BANKS:

1. Term Loan (By way of ECB) (Note 1) ....................................... 24,601,300 40,760,000

2. New Foreign Currency Term Loan for renovation (Note 1) .... 23,821,562 41,776,867

3. Medium Term Loans (Note 2) .................................................... 3 201

4. Term Loan from Bank (Note 2) .................................................. 10,594,085 —

5. Foreign Currency Term Loan ( Note 2) ..................................... 7,083,138 16,725,912

6. Cash Credits (Note 3) ................................................................. 29,729,507 13,573,935

7. Interest accrued and due ............................................................ 122,661 —

TOTAL 95,952,256 112,836,915

NOTES:

1. Loans under items No. (1) and (2) from Bank of Baroda are secured by (i) a mortgage executed in
favour of Bank of Baroda by

deposit of title deeds of all the immovable properties of the Company situated at Village Varca, Salcette,
Goa, both present an d

30



future, and (ii) a first charge by way of hypothecation of all the movables (except book debts) including
machinery, spares, to ols

and accessories, present and future (subject to the charges created in favour of the Company’s Bankers
on its stocks of raw

material, consumable stores, etc. for working capital borrowings) and (iii) personal guarantees of the
Managing Director and

Executive Director. The balance in Loan Account under item No. (1) and (2) is after adjustment of foreign
exchange gain of Rs.

8,786,483/- (Prev. year Rs. 20,245,354/-) arose during the year.

2. Loans under item No. (3) to (5) from Bank of India is secured by way of first charge on (i) immovable
properties of the Company

situated at Village Varca, Salcette, Goa, both present and future and (ii) all the movable assets of the
Company including

machinery, spares, tools and accessories, present and future and by way of personal guarantees of the
Managing Director and

Executive Director. The balance in Loan under item No. (3) is after adjustment of foreign exchange gain
of Rs. 1,506,030/- (Prev.

year Rs. 4,804,786/-) arose during the year.

3. Cash Credits from Bank of Baroda and Bank of India under item No. (6) are secured by hypothecation
of Company’s inventories

of stocks, stores and provisions, goods in transit and other moveable items and book debts, both
present and future.

4. Amount payable within one year Rs. 58,505,000/- (Prev. Year Rs. 43,247,000/-).

Previous Year

Rupees Rupees

SCHEDULE “D” : UNSECURED LOANS

Vehicle Loans .................................................................................. 7,426,548 9,729,804

From erstwhile Collaborators .......................................................... 14,840 14,840

Security Deposits from a Subsidiary Company ............................ 1,186,000 1,186,000

Security Deposits from Shops and Others .................................... 1,575,000 1,650,000

Short term loan from Delta Corps Ltd. (since repaid) .................. 51,250,000 —

TOTAL 61,452,388 12,580,644


NOTES:

1. Capital Work in Progress includes:

(a) Advances of Rs. Nil (Prev. Year Rs. 7,253,400/-) and Pre-Operative Expenses of Rs Nil (Prev. Year Rs.
4,705,215/-) paid and

incurred on proposed Jaipur Hotel Project, which is considered doubtful. These amounts are net of
Provision of Rs. Nil (Prev. Y ear

Rs. 11,98,615/-) made for such doubtful project. (Refer Schedule J-1) .

(b) Pre-Operative Expenses include : Payment of Legal and Consultants Fees- Rs. Nil (Prev. Year Rs.
1,667,135/-); Travelling and

Conveyance of Rs. Nil (Prev. Year 986,271) and Security and other Expenses of Rs. Nil (Prev. Year
2,051,809/-).

(c) Expenses and advances of Rs. 363,682/- (Prev. year Rs. 1,785,840/-) incurred on
renovation/refurbishing of the hotel, pendin g

completion of the work, (pending allocation).

2. Additions to Fixed Assets include Rs. NIL (Prev. Year Rs.7,265,307/-) being loss due to fluctuation in
foreign currency rates capitalised

in accordance with AS-11 Notification.

3. Deductions from Fixed Assets include foreign exchange gain of Rs 8,786,483/- (Previous year Rs Nil)
due to fluctuation of for eign currency

rates in accordance with AS-11 Notification.

4. Includes Rs. 23,757/- (Previous Years Rs. Nil) relating to earlier years.

SCHEDULE “E” : FIXED ASSETS (Amount in Rupees)

1 Land (Free hold) 23,626,546 — — 23,626,546 ————23,626,546 23,626,546

(Including

landscaping)

2 Buildings 379,974,250 322,285 4,638,755 375,657,780 98,529,912 9,455,412 (24,575) 108,009,899
267,647,881 281,444,338

3 Plant and Machinery 126,336,532 10,164,765 8,590,875 127.910,422 52,195,397 6,773,807 4,481,986
54,487,218 73,423,204 74,141,135

4 Furniture, Fixtures 118,468,743 1,530,564 1,655,612 118,343,695 69,931,559 6,544,625 251,841
76,224,343 42,119,352 48,537,184

and Office Equipment

5 Vehicles and Motor 19,036,589 22,000 449,852 18,608,737 3,734,675 1,803,968 257,908 5,280,735
13,328,002 15,301,914

Boats (Ref. Note 4)

6. Intangible Asset- 2,332,937 — 351,113 1,981,824 758,345 320,468 218,470 860,343 1,121,481
1,574,592

Computer Software

TOTAL 669,775,597 12,039,614 15,686,207 666,129,004 225,149,888 24,898,280 5,185,630 244,862,538
421,266,466 444,625,709

Previous Year Total 758,148,517 40,420,409 128,793,329 669,775,597 262,954,011 25,086,088
62,890,211 225,149,888 444,625,709

7 Capital Work in Progress [See Note (1) below] 363,682 1,785,841

GROSS BLOCK (AT COST) DEPRECIATION NET BLOCK

As at Additions Deductions As at Upto For the Less: Sales/ As at As at As at

1.4.2009 (Note 2) (Note 3) 31.3.2010 31.3.2009 year (Adjustments) 31.3.2010 31.3.2010 31.3.2009

31



Previous Year

Rupees Rupees Rupees

SCHEDULE “F” : INVESTMENTS: (Long Term)

Trade : (At cost)

Investment in Shares of Subsidiary Companies:

(Unquoted) (Fully paid up)

Advani Pleasure Cruise Co. Private Limited:

2,218,500 Equity Shares of Rs. 10/- each ..................................................... 22,185,000 22,185,000

Less: Provision for diminution in Value of Investment................................... — 22,185,000

(Refer Note 16 (a) of Part B Schedule “K”)

22,185,000 —

Advani Flight Catering Services Private Limited:

10,000 Equity Shares of Rs. 10/- each .......................................................... 100,000 100,000

TOTAL 22,285,000 100,000

Note: Aggregate of unquoted investments – Cost 22,285,000 100,000

SCHEDULE “G” : CURRENT ASSETS, LOANS AND ADVANCES

CURRENT ASSETS:

Interest accrued ........................................................................................ 14,755 —

Stock:

(Valued and certified by the Management)

Stores and Operating Supplies ................................................................... 11,766,234 14,126,434

Food and Beverage..................................................................................... 1,832,230 1,790,099

13,598,464 15,916,533

Sundry Debtors:

(Unsecured, good unless otherwise stated)

Over six months .......................................................................................... 3,874,199 3,951,601

(Rs.3,226,137/- considered doubtful (Prev. Year Rs. 3,059,160/-)

Refer Note 7(a) of Part B of Schedule “K”)

Others........................................................................................................... 20,716,290 16,604,636

24,590,489 20,556,237

Less: Provision for Doubtful Debts ............................................................. 3,226,137 3,059,160

21,364,352 17,497,077

Cash and Bank Balances:

On Hand....................................................................................................... 1,150,277 1,449,786

With Scheduled Banks: On Current Account ...................................... 5,643,536 10,623,288

On Margin / Deposit Account ....................... 1,917,343 2,206,692

With other Bank on:

Current Account (Refer Note 7(c) of part B of Schedule “K”) ........... 129,056 129,122

8,840,212 14,408,888

LOANS AND ADVANCES:

(Unsecured, good unless otherwise stated)

Advances recoverable in cash or in kind or for value to be received 103,094,812 41,645,349

(Rs. 25,315,947/- considered doubtful (Previous year Rs.25,635,231/-)

(Refer Note 7(a) of Part B of Schedule “K”)

Less: Provision for doubtful loans and advances ..................................... 25,315,947 25,635,231

77,778,865 16,010,118

Deposits........................................................................................................ 12,326,354 17,801,989

Annual report of advani hotel

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to Annual report of advani hotel

Similar to Annual report of advani hotel (20)

More from Dr. Trilok Kumar Jain

More from Dr. Trilok Kumar Jain (20)

Recently uploaded

Recently uploaded (20)

Annual report of advani hotel