SAYAJI HOTELS LIMITED
T W E N T Y S E V E N T HA N N U A L R E P O R T 2 0 0 9 - 1 0
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BOARD OF DIRECTORS
· Sri Razak D. Dhanani - Chairman
· Sri Sajid R. Dhanani - Managing Director
· Sri Rajendra Sharma - Nominee -TFCI
· Sri Y.S. Mehta - Nominee – MPFC
· Sri T. S. Bhattacharya - Director
· Capt. Salim Sheikh - Director
· Sri Munawar Garbadawala - Director
CHIEF FINANCIAL OFFICER
· Sri Amarjit Singh Bagga
COMPANY SECRETARY
· Sri Awadhesh Gupta
STATUTORY AUDITORS
· M/s. Shah Gandhi & Shah,
Chartered Accountants, Vadodara-390019 (Gujarat)
REGISTRAR AND SHARE TRANSFER AGENT (RTA)
· Link Intime India Pvt. Limited.
C-13, Pannalal Silk Mills Compound,
L.B.S. Marg, Bhandup (W), Mumbai-400078
e-mail: [email protected]
Phone(022) 25963838, Fax: 25946969
BANKERS
· State Bank of India
· State Bank of Indore
· State Bank of Mysore
· Axis Bank Ltd.
REGISTERED OFFICE
· Sayaji Hotels, Opp. Rajshree Talkies,
Near Kala Ghoda, Sayajigunj,Vadodara – 390005
HOTELS
· Opp. Rajshree Talkies, Near Kala Ghoda, Sayajigunj,
Vadodara – 390005 (Gujarat)
· H/1, Scheme No. 54, Vijay Nagar, Near Maghdoot Garden,
Indore – 452010 (Madhya Pradesh)
· Survey No. 135, 136, Mumbai Bangalore Highway,
Opp. B. U. Bhandari Workshop, Waked, Pune - 411057
CORPORATE IDENTITY NUMBER (CIN)
· L51100GJ1982PLC005131
· Sri T.N. Unni - Director
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SAYAJI HOTELS LTD.
Standalone
· Notice
· Directors' Report
· Report on Management, Discussion and Analysis
· Report on Corporate Governance
· Auditors' Report
· Annual Accounts
Consolidated
· Auditors' Report
· Annual Accounts
BARBEQUE-NATION HOSPITALITY LTD.
· Directors' Report
Consolidated
· Auditors' Report
· Annual Accounts
MALWA HOSPITALITY PVT. LTD.
· Directors' Report
· Auditors' Report
· Annual Accounts
· Statement pursuant of Section 212 (Sayaji)
of the Companies Act, 1956 relating to Subsidiary Companies
Statement pursuant of Section 212 (BNHL)
CONTENTS
Date : September 30, 2010
Day : Thursday
Time : 12.30 P.M.
Venue : Sayaji Hotel, Vadodara
Book Closure Date : From September 27, 2010 to September 30, 2010
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restrictions, in such manner and by such persons as may, for
the time being, be permitted under the provisions of the
Articles of Association of the company or legislative
provisions for the time being in force in that behalf.
II. Alteration in the Clause No. V of the Memorandum
To Consider and if thought fit, to pass with or without
modifications, the following resolution as Special
Resolution.
RESOLVED that the existing Clause V of the Memorandum of
Association of the Company be altered and substituted by the
following new Clause:
V. The Authorised Share Capital of the company is Rs.
40,00,00,000 (Rupees Fourty Crores only) divided into
300,00,000 (Three Crore) Equity Shares of Rs. 10 (Rupees
Ten only) each and 10,00,000(Ten Lacs) Preference Shares
of Rs. 100/- (One Hundred) each.
III. Alteration in the Clause No. 3 of Articles
To Consider and if thought fit, to pass with or without
modifications, the following resolution as Special
Resolution.
RESOLVED that pursuant to section 31 of the Companies Act,
1956, Article No. 3 of the Articles of Association of the
Company be altered by substituting it with the following new
clause:
3. The Authorised Share Capital of the company is
Rs. 40,00,00,000 (Rupees Fourty Crores only) divided into
300,00,000 (Three Crore) Equity Shares of Rs. 10 (Rupees
Ten only) each and 10,00,000(Ten Lacs) Preference Shares
of Rs. 100/- (One Hundred) each, with a power of company to
increase, reduce or modify the capital and to divide all or any
of the shares in the capital of the company, for the time being,
and to classify and reclassify such shares from shares of one
class into shares of other class or classes and to attach
thereto respectively such preferential, deferred, qualified or
other special rights, privileges, conditions or restrictions as
may be determined by the company in accordance with the
Articles of Association of the company and to vary, modify or
abrogate any such rights, privileges, conditions or
restrictions, in such manner and by such persons as may, for
the time being, be permitted under the provisions of the
Articles of Association of the company or legislative
provisions for the time being in force in that behalf.
RESOLVED Further that the Board of Directors of the
Company be and is hereby authorised to do and perform all
such acts, deeds, matters and things as may be necessary,
desirable or appropriate to gives effect to this resolution.
NOTICE
NOTICE is hereby given that the Twenty Seventh Annual General
Meeting of the Members of Sayaji Hotels Limited will be held on
Thursday, 30th day of September 2010 at 12.30 P.M. at the
Registered Office of the Company at “Sayaji Hotel”, Opp.Rajshree
Talkies, Near Kala Ghoda, Sayajigunj, Vadodara–390005 (Gujarat),
to transact the following business:
ORDINARY BUSINESS
1. To receive, consider and adopt the Audited Balance Sheet for
the year ended on March 31, 2010 and the Profit and Loss
Account as at that date together with the reports of the
Directors and the Auditors thereon.
2. To appoint Director in place of Mr. Munawar Garbadawala,
who retires by rotation and is eligible, for re-appointment.
3. To appoint Director in place of Capt. Salim Sheikh, who
retires by rotation and is eligible, for re-appointment.
4. To appoint M/s Shah Gandhi & Shah Chartered Accountants,
the retiring Auditors, as the Auditors of the Company, who
shall hold office from the conclusion of this Annual General
Meeting until the conclusion of the next Annual General
Meeting on such remuneration as may be fixed by the Board
of Directors.
SPECIAL BUSINESS
5. I. To Increase Authorised Equity Share Capital from
Rs. 20,00,00,000.00 to Rs. 30,00,00,000.00
To Consider and if thought fit, to pass with or without
modifications, the following resolution as Special
Resolution.
RESOLVED that pursuant to provisions of sections 94, 97
and other applicable provisions, if any, of the Companies Act,
1956, the Authorised Equity Share Capital of the company be
and is hereby increased from Rs. 20,00,00,000 (Rupees
Twenty Crores Only) divided into 200,00,000 (Two Crore)
Equity Shares of Rs. 10 (Rupees Ten Only) each to Rs.
30,00,00,000 (Rupees Thirty Crores only) by creation of
100,00,000 (One Crores) Equity Shares of Rs. 10 (Rupees
Ten only) each, with a power of company to increase, reduce
or modify the capital and to divide all or any of the shares in
the capital of the company, for the time being, and to classify
and reclassify such shares from shares of one class into
shares of other class or classes and to attach thereto
respectively such preferential, deferred, qualified or other
special rights, privileges, conditions or restrictions as may
be determined by the company in accordance with the
Articles of Association of the company and to vary, modify or
abrogate any such rights, privileges, conditions or
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6. To Increase remuneration of Managing Director Sri Sajid
R. Dhanani
To Consider and if thought fit, to pass with or without
modifications, the following resolution as Special
Resolution.
RESOLVED that pursuant to the provisions of Section 198,
309, 310, 311 read with the provisions of Schedule XIII and
other applicable provisions, if any, of the Companies Act,
1956 (including any Statutory modification or re-enactment
thereof for the time being enforce), Articles of Association of
the Company and Lead Financial Institution, in writing and
subject to approval of any Authority, wherever required, the
consent of the Meeting be granted to increase the overall
remuneration of the Managing Director from Rs. 2,50,000/-
p.m. or 5% of net profit of the company ( whichever is
higher) to Rs. 400,000/- p.m. or 5% of net profit (which ever
is higher) w.e.f. 1st April 2010 on such terms & conditions as
considered by the remuneration committee and set out in the
Explanatory Statement annexed herewith to”.
“FURTHER RESOLVED that the Company Secretary of the
Company be authorized to submit the proper form to the RoC
and to comply with all the necessary formalities in this
regard”.
7. To appointment of Sri Munawar Garbadawala as
Wholetime Director .
To Consider and if thought fit, to pass with or without
modifications, the following resolution as Ordinary
Resolution.
RESOLVED that pursuant to the provisions of section 198,
269, 302, 309, 310 read with Schedule XIII and other
applicable provisions of the Companies Act, 1956 (including
any statutory modifications or re-enactment thereof for the
time being in force) the approval of the Company be and is
hereby granted for appointment of Mr. Munawar
Garbadawala as the Whole-time Director of the Company and
designated as the executive director of the Company for a
period of 3 years w. e. f. 1st April, 2010 on the such terms,
conditions as approved by the Board of Directors of the
Company:
RESOLVED further that in the event of there being loss or
inadequacy of profit for any financial year, the aforesaid
remuneration payable to Mr. Munawar Garbadawala, shall be
the minimum remuneration payable to him in terms of the
provisions of Schedule XIII to the Companies Act, 1956.
RESOLVED further that the Managing Director of the
Company be and are hereby authorized to do all such acts,
deeds, matters and things as in its absolute discretion, it may
consider necessary, expedient or desirable, and to settle any
question, or doubt that may arise in relation thereto and the
Managing Director shall have absolute powers to decide
break up of the remuneration within the above said
maximum permissible limit and in order to give effect to the
foregoing resolution, or as may be otherwise considered by it
to be in the best interest of the Company.
8. To appointment of Mr. Sujit Desai as Manager in Training.
To Consider and if thought fit, to pass with or without
modifications, the following resolution as Special
Resolution.
RESOLVED that pursuant to the provisions of Section
314(1)and other applicable provisions, if any, of the
Companies Act, 1956, the company hereby consent to
appoint Sri Sujit Desai who is a relative of Sri Abdul Razak
Dhanani, Chairman and Sri Sajid R. Dhanani, Managing
Director of the company for holding and continuing to hold
an office or place of profit as an employee of the Company
w.e.f. 1st November, 2009 as an Manager in training on a
consolidated salary not exceeding Rs. 50,000/-per month as
decided by Board of Directors including all per perquisites,
allowances and benefits payable to other employees of his
grade.
9. Preferential Allotment of Equity Shares & Warrants:
To consider and if thought fit, to pass, with or without
modification(s), the following resolution as a Special
Resolution:
“RESOLVED that in terms of Section 81, 81(1A) and all other
applicable provisions, if any, of the Companies Act, 1956
(including any statutory modification(s) or re-enactment
thereof, for the time being in force), Memorandum and
Articles of Association of the Company, Listing Agreement
entered into by the Company with the Stock Exchanges,
where the shares of the company are listed, and in
accordance with the provisions of the Securities and
Exchange Board of India (Issue of Capital and Disclosure
Requirements) Regulations, 2009 as may be applicable on
preferential issue of Equity Shares, Warrants convertible into
Equity Shares other applicable regulations/guidelines of
SEBI, if any and subject to such consents and approval from
Securities And Exchange Board of India (SEBI), Stock
Exchange, Govt. of India or such other bodies or authorities
as may be required by the Law and as may be necessary and
subject to such conditions and modifications as may be
imposed upon and which may be agreed by the Board of
Directors of the Company (hereinafter called the Board)
and/or a duly authorised committee of Directors thereof for
the time being exercising the powers conferred by the Board
of Directors (hereinafter called the 'committee'), consent of
the members of the Company be and is hereby accorded to
the Board to offer/issue/allot upto 15,00,000 (Fifteen Lacs )
Equity Shares of Rs. 10/- each at the premium of Rs. 115/-
per share, and 18,00,000 (Eighteen Lacs) Warrants that are
convertible in to fully paid up equity shares (face value of Rs.
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10/- each), on one equity share for one Warrant basis, within
a period of on or before 8 (eight) months from the date of
allotment at price not higher than Rs. 125 per warrant, on a
preferential basis, to the following Promoters, Persons,
Companies as mentioned in detail in the explanatory
statement.”
Sr. No. Name of the proposed Allottees
1 M/s Blue Deebaj Chemical LLC
2 Mr. Sajid R. Dhanani
3 Mrs. Suchitra Dhanani
4. M/s Liberty Phosphate Limited
All the above mentioned proposed allottees are the
promoters and/or has been defined as persons acting in
concert.
"RESOLVED FURTHER that the offer and allotment of the aforesaid equity shares, warrants shall be made at such time or times as the Board may in its absolute discretion decide, subject however to the compliance with applicable guidelines, notifications, rules and regulations."
RESOLVED FURTHER that the pricing of the Equity Shares and Warrants to be allotted on conversion of the above said warrants, calculated in accordance with the SEBI Regulations/Guidelines on the 'Relevant Date' in relation to the conversion of every warrants into one Equity Share, and the relevant date as under:
(i) 15,00,000 Equity Shares and 18,00,000 Warrants of Rs. 125 each shall be convertible into 18,00,000 Equity Share of the face value of Rs. 10 each on payment of aggregate price including premium of Rs. 115 (Rupees One Hundred Fifteen only).
(ii) 15,00,000 Equity Shares of Rs. 125 each shall be allotted after receiving of face value of Rs. 10 each including premium of Rs. 115 (Rupees One Hundred Fifteen only):
(iii) Exercise of offer for conversion of the warrants shall be at the sole option of the warrant holders at any time with on or before a period of 8 months from the date of allotment of warrants in accordance with the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009.
(iv) The warrant holder(s) shall pay an amount equivalent to 25% i.e. Rs. 31.25 (Rupees Thirty One and Paise Twenty Five only) per warrant of the value of the warrant on or before the date of allotment of warrants.
(v) The amount referred to in point (iv) above shall be adjusted against the price payable subsequently for acquiring the shares by exercising an option by the warrant holder(s).
(vi) The warrant holder(s) shall pay on or before the date of conversion of such warrants into equity shares, the balance 75% (Rs. 93.75 for each warrant).
(vii) The equity shares and warrants shall be locked in for a period of three/one years as applicable SEBI Regulation 2009 from the date of their allotment. Provided that the lock-in on shares acquired by conversion of warrants shall be reduced to the extent the warrants have already been locked-in.
(viii) The allotment of equity shares and convertible warrants shall be completed within a period of 15 days from the date of passing of this resolution by the shareholders provided, that where the allotment is pending on account of pendency of any approval from any regulatory authority or the Central Govt., the allotment shall be completed by the Company within a period of 15 days from the date of such approvals.
RESOLVED FURTHER that the Equity Shares so issued on conversion of warrants shall upon allotment have the same rights of voting as the existing equity shares and be treated for all other purposes pari passu with the existing equity shares of the Company and that the equity shares so allotted during the financial year shall be entitled to the dividend, if any, declared including other corporate benefits, if any, for the financial year in which the allotment has been made and subsequent years.
RESOLVED FURTHER that for the purpose of giving effect to the above resolution, the Board be and is hereby authorised to agree and accept all such condition(s), modification(s) and alteration(s) as may be stipulated by any relevant authorities while according approval or consent to the issue as may be considered necessary, proper or expedient and give effect to such modification(s) and to resolve and settle all questions, difficulties or doubts that may arise in regard to such issue and allotment and to do all acts, deeds and things in connection therewith and incidental thereto without being required to seek any further consent or approval of the members of the Company to the intent that the members shall be deemed to have given their approval thereto expressly by the authority of this resolution.
RESOLVED FURTHER that the Company shall ensure that whilst any warrants remaining exercisable, it will at all times, keep available and reserved such part of its authorised but un-issued share capital as would enable all outstanding warrants to be satisfied in full.
By Order of the Board of Directors
Indore, 31st August, 2010 CHAIRMAN
Registered Office :
Sayaji Hotel,
Near Kala Ghoda,
Sayajigunj, Vadodara-390005
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NOTES
1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE
MEETING IS ALSO ENTITLED TO APPOINT A PROXY TO
ATTEND AND VOTE INSTEAD OF HIMSELF AND THE PROXY
NEED NOT BE A MEMBER OF THE COMPANY. THE
PROXIES, IN ORDER TO BE VALID MUST BE DEPOSITED AT
THE REGISTERED OFFICE OF THE COMPANY NOT LESS
THAN 48 HRS BEFORE THE TIME FOR THE MEETING.
2. An Explanatory Statement pursuant to Section 173(2) of the
Companies Act, 1956, relating to special business to be
transacted at the meeting is annexed hereto.
3. Shareholders are requested to bring their copy of Annual
Report to the meeting.
4. Members/ Proxies should fill the Attendance slip for
attending the meeting.
5. In case of joint holders attending the meeting, only such joint
holder who is first in the order of names will be entitled to
vote.
6. Members who hold shares in de-materialized form are
requested to write their Client ID and DP ID numbers and
those who hold shares in physical form are requested to
write their Folio Number in the attendance slip for attending
the meeting.
7. Members desirous of obtaining any information / details as
regard accounts and operations of the Company are
requested to write to the Company at least 7 days before the
meeting to enable the Company to keep the required
information ready at the time of meeting.
8. Corporate Members intending to send their authorized
representative to attend the Annual General Meeting are
requested to send a duly certified copy of the Board
Resolution authorizing their representative to attend and
vote at the meeting.
9. All documents referred to in the accompanying notice and
the Explanatory Statement are open for inspection at the all
working days between 11.00 a.m. to 1.00 p.m. upto the date
of the Annual General Meeting.
10. Members are requested to notify promptly any change in
their addresses to the Registrar and Transfer Agent Link
Intime India Pvt. Ltd., Unit: Sayaji Hotels Limited,C-13,
Pannalal Silk Mills Compound,L.B.S. Marg, Bhandup(W),
Mumbai-400078.
The Register of Members and Share Transfer Books of the
Company will remain closed from Monday, 27th day of
September, 2010 to Thursday, 30th day of September,
2010 (both days inclusive).
EXPLANATORY STATEMENTThe following Explanatory Statement, Pursuant to the provisions
of Sec. 173(2) of the Companies Act, 1956, sets out all material
facts relating to the business mentioned at Item no. 5,6,7,8 and
9 of the accompanying Notice dated August 31, 2010.
Item No. 5
The present Authorised Share Capital of the company is Rs.
30,00,00,000 (Rupees thirty Crores only) divided into 200,00,000
(Two Crore) Equity Shares of Rs. 10 (Rupees Ten only) each and
10,00,000(Ten Lacs) Preference Shares of Rs. 100/- (One
Hundred) each. Out of this 175,18,000 equity shares have been
issued and there has been no issue of Preference Shares.
The growth of the company's operation augmentation of resources
and the Board of Directors of the company is planning to make a
Preferential/Right issue of equity shares to part finance for
proposed project and augmenting long-term working capital
requirements of the company. In order to go in for any such issue,
the Authorised Capital of the company should be adequately
increased to accommodate the proposed augmentation of the
capital base. The change proposed will necessitate amendment to
the Capital Clause of the Memorandum of Association and Articles
of Association of the company.
Pursuant to section 16 and 31 of the Companies Act, 1956 read
with section 94 of the said Act, the above said amendments should
be approved by the General Body by way of a Special Resolution.
Your Board of Directors recommended the proposed resolutions
giving effect to the above amendments for your approval.
None of the Directors is interested in the proposed resolutions.
Item No. 6
The Board meeting held on 30th June, 2007, the Board of Directors
had passed a resolution and increase remuneration Sri Sajid R.
Dhanani, Managing Director of the Company upto Rs. 2,50,000/-
p.m. or 5% of net profits of the Company whichever is higher, had
taken effect from 1st April, 2007 and that the Members at their
Annual General Meeting held on 29th September, 2007 had
approved it.
Sri Sajid R. Dhanani has wide and rich experience in the field of the
hotels and the restaurants, thus to enable Sri Sajid R. Dhanani to
focus on the operations and management of the company in a
broader way. Since the salary structure of the managerial personnel
has undergone a major change in the hotel industry, it is also
proposed that his remuneration structure may also be revised
which would be comparative with the remuneration being paid
other hotel companies in the similar position. In view of the
economic performance of the company this will be helpful for the
Company to achieve the desired business, growth and to make the
Company competitive in the present corporate scenario.
The Remuneration proposed to be increased upto Rs. 400,000/-
p.m. or 5% of net profit (which ever is higher) is in accordance to
the provisions of Schedule XIII and Section 198, 309, 310, 311 of
the Companies Act, 1956 and the specific nature of the matter to be
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duly considered by the Remuneration Committee as under:
1) Salary : Rs.2,40,000/- per month.
2) Commission : Commission based on the net profits of the
company computed in the manner laid down in section
309(5)of the Companies Act, 1956 subject to the provisions
of section 198,309 and other applicable provisions of the
Companies Act, 1956 such commission shall be such
percentage of the net profit and such amount as the board of
Directors of the Company may determine keeping in view the
performance of the Company in each financial year.
3) Perquisites and Allowance : Which shall be restricted to an
amount equal to Rs. 1,60,000/- per month and may be paid
under following categories:
a. House Rent Allowance
b. Medical Reimbursement
c. Leave Travel Allowance
d. Annual Club maintenance Fees
e. Payment of Statutory contribution towards PF, ESIC as
may be applicable
f. Other allowance
g. Conveyance allowance
h. Driver’s Salary
As per Section II [1 (B)] of PART II of schedule XIII of the
Companies Act 1956, the following information as given below to
the shareholders :
I. General Information:
(1) Nature of Industry. : Hotel & Restaurant
(2) Date or expected date of commencement of
commercial production: N.A.
(3) In case of new companies, expected date of
commencement of activities as per project approved
by financial institutions appearing in the prospectus:
N.A
(4) Financial performance based on given indicators.
i) Sales : Rs. 819.75 million (31.03.2010)
ii) Profit/Loss After Tax:(Rs. (4.66 million)
(5) Export performance and net foreign exchange
collaborations:
Foreign Currency Earning: Rs. 64.306 million
Foreign Exchange Outgo :Rs. 10.454 million
(6) Foreign Investments or collaborators, if any:
Clearwater Capital Partners (Cyprus) Limited
(Dt. 18.05.2006)
II. Information about the appointee:
(1) Background details. :
i) Name: Mr. Sajid R. Dhanani
ii) Age: 45 years
iii) Qualification: Diploma in Hotel Management.
iv) Experience: 25 years experience in hotel industry.
(2) Past remuneration. : Rs. 250,000/- Month
(3) Recognition or awards.: Nil
(4) Job profile and his suitability:
Mr. Sajid R. Dhanani is responsible for the day to day
operations & management of the company under the
overall superintendence, direction and control of the
Board of Directors. He is 45 years old, holds Diploma
in Hotel Management and has over 25 years
experience in hotel industry.
(5) Remuneration proposed: As given in Resolution.
(6) Comparative remuneration profile with respect to
industry, size of the company, profile of the position
and person (in case of expatriates the relevant details
would be w.r.t. the country of his origin): The proposed
remuneration is in line with the industry trends for
similar size of business units.
(7) Pecuniary relationship directly or indirectly with the
company, or relationship with the managerial
personal, if any : Promoter and Son of Chairman Mr.
Abdul Razak Dhanani
III. Other information:
(1) Reasons of loss or inadequate profits.
The Company has launched one new Hotel in the
previous year. In the initial stage expenses are typically
higher due to higher set-up and interest costs.
(2) Steps taken or proposed to be taken for improvement.
Company is trying to grow our sales revenue and
reducing higher cost.
(3) Expected increase in productivity and profits in
measurable terms : the company expects sales to
increase to Rs. 1500.00 million in 2010-11 and net
profit of Rs. 150.00 million.
IV. Disclosures:
(1) The shareholders of the company shall be informed of
the remuneration package of the managerial person :
is given in annual report.
(2) The following disclosures shall be mentioned in the
Board of Director’s report under the heading
“Corporate Governance”, if any attached to the annual
report:-
(i) All elements of remuneration package such as
salary, benefits, bonuses, stock options,
pension, etc. of all the directors;
(ii) Details of fixed component and performance
linked incentives along with the performance
criteria;
(iii) Service contracts, notice period, severance fees;
(iv) Stock option details, if any, and whether the
same has been issued at a discount as well as
the period over which accrued and over which
exercisable.
9
Item No. 7
The Board of Directors at the Meeting held on 31st August, 2010
subject to the approval of the Members, appointed Mr. Munawar
garbadawala as an whole-time Director, to assume responsibilities
as Whole-time Director of the company with effect from 1st April
2010 and thereafter.
Mr. Munawar Garbadawala, 55 years old, holds Diploma in Hotel
Management and has over 30 years experience in hotel industry. He
shall be responsible for the day to day operations & management of
the Baroda Hotel under the overall superintendence, direction and
control of the Board of Directors.
Item No. 8
Looking into the expansion of the business activities of the
Company, the Board of Directors at their meeting held on 29th
January, 2010 has considered that the Company should appoint a
qualified officer for discharging the duties of training officer in the
Company. The Board proposed the name of Mr. Sujit Desai, is
relative of Mr. Abdul Razak Dhanani, Chairman and Mr. Sajid R.
Dhanani, Managing Director of the company for appointment as the
Manager in training w. e. f. 01, November 2009.
The Board considered that Mr. Sujit Desai, aged 47 years is a
qualified, having practical experience of more than 5 years in this
field. The Board considers that looking into his dynamic education
background and his experience will strengthen the management in
controlling activities of the Company in more proper manner.
He shall be the training manager of the Company and will be
responsible for all the training affairs of the Company.
The terms of remuneration, as set out in the resolution are
considered to be just, fair and reasonable and are in accordance
with the remuneration paid to other similar placed executives in the
Company as well as in the Industry.
In terms of the provisions of section 314 (1) of the Companies Act,
1956 read with Director’s Relatives (Office or Place of Profit) Rules,
2003, the appointment of relative of Director of the Company on a
remuneration not exceeding Rs. 50000/- p.m. requires the
approval of the members by way of special resolution. The
resolution mentioned in the Item No. 8 of the notice is being
proposed for approval accordingly.
Except, Sri Abdul Razak Dhanai and Sri Sajid R. Dhanani, being the
relative of the proposed appointee, none of the Directors of the
Company is concerned or interested in the above said resolution.
Item No.9
Members may be aware that the company is not declaring any
dividend during the previous years. Consequently, investment in
shares has become more advantageous and popular to investors,
who are approaching the Company for Bulk investment in equity
shares/warrants on a preferential basis. Your Directors intends to
consider such proposals as and when necessary.
Looking into the possibilities of further expansion plans, future
growth, prospective revenue earning position, repayment of debts
of Sayaji Hotels Limited, Promoters, and companies want to infuse
more funds in the company in the form of share capital, towards the
consideration value of Rs. 125/- per share/warrant, being the price,
higher than the average price determined as per preferential
allotment guidelines of the SEBI. Thus the share/warrant of Rs. 10/-
each will be issued at the premium of Rs.115/-.
Your Directors are of the view that the proposed issue and
allotment will be in the benefit of the share holders of your
company. Your directors also consider the Basis of allotment of the
shares/warrants in the manner stated above, as fair and
reasonable. Your Directors therefore commend the resolution for
adoption.
The allotment, if made, to promoters companies, that would be
allotted strictly as per the Securities and Exchange Board of India
(Issue of Capital and Disclosure Requirements) Regulations, 2009
As per SEBI (Substantial Acquisition and Takeovers) Regulation,
1997, certain disclosures which are required, the Board of
Directors of the Company give below disclosures that are required
to be given in the explanatory statement to the special resolution to
be passed under section 81(1A) of the Companies Act, 1956 and in
terms of the SEBI (Disclosure and Investors Protection)
Guidelines.
1. Object and manner of activities of proceed of the Issue to be
utilised:
The purpose of the issue is to allot the equity shares and
warrants convertible into the equity shares is to achieve long
term plans of the Company and to meet the funding
requirements including but not limited to investment for
meeting its business requirements, funding ongoing capital
expenditure and/or for the repayment of its long term debts.
The above allotment is made in the interest of the company
and shareholders. Looking into the possibilities of further
expansion plans, future growth, prospective revenue earning
position and repayment of debts of Sayaji Hotels Limited,
Investors wants to infuse more funds in the company in form
of share capital and warrants. This will enable the company
to offer/issue and/or allot to the investors who are
approaching the Company for Bulk investment in equity
shares/warrants on a preferential basis. The fund will be
utilized in funding expansion project, capital expenditures,
long term working capital requirements for expansion
activities and repayment of debts of the company.
2. Relevant date and pricing of the issue:
The issue price of the Equity Shares and Warrants
convertible into the Equity Shares shall be Rs. 125.00 (Rs.
One Hundred Twenty Five only) each.
The price of the Equity shares and warrants of Rs. 10 each
together with premium of Rs. 115.00 (Rs. One Hundred
Fifteen only) has been fixed for Rs. 125.00 (Rs. One Hundred
Fifteen only) per share to be issued on conversion of
10
warrants based on the relevant date 31st August., 2010
calculated in the manner specified for pricing of shares and
warrants to be allotted in lieu of warrants as per the
Securities and Exchange Board of India (Issue of Capital and
Disclosure Requirements) Regulations, 2009.
As per the Securities and Exchange Board of India (Issue of
Capital and Disclosure Requirements) Regulations, 2009,
the price for equity shares/ warrants convertible into Equity
Shares of Rs. 10 each has been determined at Rs. 109.06 per
Share/Warrant convertible into equity shares on the relevant
date 31st August, 2010, based on the quotations available at
the Bombay Stock Exchange, Mumbai. The issue price of Rs.
125 per Shares/Warrant is much higher than the SEBI
guidelines. A Certificate to that effect has been obtained from
the Auditors of the Company on 4th September, 2010 which
is also available for inspection at the Registered Office of the
Company.
15,00,000 Equity Shares of Rs. 10/- each will be issued at
the premium of Rs. 115/- each, aggregating Rs.
18,75,00,000/- (Rs. Eighteen Crores Seventy Five Lacs
Only). These shares will be allotted to promoters companies.
This price is higher than the average price determined in
accordance with SEBI Preferential Issue Regulations,
prescribed in Chapter VII of Securities and Exchange Board
of India (Issue of Capital and Disclosure Requirements)
Regulations, 2009, as amended upto date Quotes are
received from BSE website.
18,00,000 Warrants will be issued at Rs. 125/- each
aggregating Rs. 22,50,00,000/- (Rs. Twenty Two Crores Fifty
Lacs Only).This price is higher than the average price
determined in accordance with SEBI Regulations for
preferential issue/allotment.
3. Intention of the promoters or their associates and relatives to
subscribe to the offer:
The proposed allottees for preferential issuance of 15,00,000
Equity Shares and 18,00,000 Warrants to be converted into
the Equity shares of Rs.10 each are the relatives of the
promoters and/or person(s) acting in concert (PAC) as
referred in the resolution.
4. Identity of the proposed allottees and :
As stated earlier, it is proposed to allot 15,00,000 equity
shares and 18,00,000 warrants to the promoters, their
relatives and persons acting in concert. The share holding
that may be held by allottees in post-issued capital shall be as
set out
Equity Shares
Warrants:
18,00,000 warrants to be issued/ allotted only two
promoters of the following:
v) Consequential change, if any in the share holding pattern of the allottee company:
1 Indian Promoters 66,74,605 38.102 81,74,605 42.983 99,74,605 47.913
2 Person Acting in Concert 100 0.00 100 0.000 100 0.000
3 Mutual Fund and UTI 155,093 0.885 155,093 0.815 155,093 0.745
4 Banks,Financial Institutions [Central/State 300 0.001 300 0.001 300 0.001
Govt. Institution/Non Govt. Institution], FIIS
5 Corporate Bodies 926,526 5.289 926,526 4.872 926,526 4.451
6 Indian Public 10,11,400 5.774 10,11,400 5.319 10,11,400 4.858
7 NRIs/ OCBs 15,85,573 9.051 15,85,573 8.338 15,85,573 7.617
8 d. Foreign Institutional Investors 13,95,747 7.968 13,95,747 7.340 13,95,747 6.705
9 Foreign Companies 57,57,891 32.868 57,57,891 30.276 57,57,891 27.658
10 Clearing Member 10,765 0.062 10,765 0.056 10,765 0.052
Total 175,18,000 100.00 190,18,000 100.00 208,18,000 100.00
Sr.No.
Pre - Issue Post – Issue (After allotment of
Eq. Shares)
Post – Issue(After Conversion of
Warrants into Eq. Shares)Category As on 30.08.2010
No. of Shares % of holding No. of Shares % of holding No. of Shares % of holding
Name CategoryPre Issue
Holding%
Proposed
Issue
Post Issue
Holding%
M/s Blue Deebaj
Chemical LLCPromoters 15,00,000 15,00,000 7.880.000.00
Name CategoryPre Issue
Holding%
Proposed
Issue
Post Issue
Holding%
Promoters
Promoters
Promoters
15.54
5.86
4.32
Mr. Sajid R. Dhanani
Mrs. Suchitra Dhanani
M/s Liberty Phosphate Ltd.
23,35,511
3,20,000
0.00
13.33
1.826
0.00
9,00,000
9,00,000
9,00,000
32,35,511
12,20,000
9,00,000
Other Details
i) Consequential changes, if any in voting rights:
The Voting rights would change in tandem with the share
holding pattern.
ii) Changes expected in Board after conversion takes place:
There would be no change in the Board of Directors
consequent to the above allotment.
iii) Whether the said allotment would result in change in
control over the Company:
The said allotment would not result in any change in the
control over the company, except change in share holding.
iv) Proposed date of Allotment:
Within the period of 15 days from date of passing resolution
or as per the SEBI (Issue of Capital and Disclosure
Requirements) Regulations, 2009 applicable as on date.
v) Lock in period :
The Shares/warrants as mentioned above, to be
issued/allotted to promoters shall be subject to lock in of 3
years as per the SEBI (Issue of Capital and Disclosure
Requirements) Regulations, 2009 amended upto the Date.
Provided that not more than twenty per cent. Of the total
capital of the issuer shall be locked-in for three years from
the date of allotment.
Provided further that equity shares allotted in excess of the
twenty per cent. Shall be lock-in for one year from the date of
their allotment pursuant to exercise of options or otherwise,
as the case may be.
vi) Relevant Date :
The relevant date for the purpose of SEBI (Disclosure and
Investor Protection) Guidelines, 2000 is 31st August, 2010,
i.e. 30 days prior to date of Annual General Meeting.
vii) Some specific terms of the warrants proposed to be issued:
lThe warrants under this resolution shall entrust a right
in the holder to apply and acquire equity shares of Rs.
10 each on one warrant one equity share basis, at price
not lower than the price under SEBI Guidelines and not
higher than Rs. 125/- per warrant.
lWarrants so issued will be convertible into fully paid up
equity shares of Rs. 10/- each(one warrant one equity
share basis) at any time with on or before expiry of 8
months from date of allotment and the Board of
Directors of the company be authorised to allot fully
paid equity shares upon such conversion.
lThe equity shares so issued on conversion of the
warrants shall rank pari-pasu in all respect with and
carry the same rights including dividend as, the
existing equity shares.
With the additional issue/allotment of shares to Promoters and
other Investors, the Paid up equity shares capital will be increased
and at the same time, by infusion of funds in expansion projects,
the revenue generation and profitability of the Company will go up
in due course of time.
SEBI Takeover code: In terms of the SEBI (Substantial Acquisition
of Shares and Takeovers) Regulations, 1997, the investors are not
required to and do not intent to make an open offer and comply with
formalities related to an open offer for this preferential allotment.
Holding of shares in the D-mat Account, non disposal of shares by
the proposed allottees and lock-in period of shares: The proposed
allottees are holding their entire pre-issued shareholding in the D-
mat form and they have not sold or disposed off any equity share of
the company during the six months period prior to the relevant date
and further that they will not sale or dispose any shares held by
them during the period of six months from the date of allotment of
the equity shares and warrants on preferential basis. The equity
shares and warrants so allotted shall be under lock-in period of 3
years from the date of allotment to the promoters, their relatives
and person acting in concert. Provided that the lock-in on the
shares acquired on conversion of warrants shall be reduced to the
extent the warrants have already been locked-in.
Provided that not more than twenty per cent. Of the total capital of
the issuer shall be locked-in for three years from the date of
allotment.
Provided further that equity shares allotted in excess of the twenty
per cent. Shall be lock-in for one year from the date of their
allotment pursuant to exercise of options or otherwise, as the case
may be.
The Auditors' Certificate for the issue price and other relevant
papers will be available at the Registered office of the Company
between 10.00 AM to 5.00 PM till AGM Date, and those papers will
be made available for inspection for the members at the AGM.
Section 81 of the Companies Act, 1956 and the Listing Agreements
executed with the Stock Exchanges, where your company's shares
are listed, provide inter alia, that when it is proposed to increase the
issues capital of the Company by allotment of further shares, such
further shares shall be offered to the existing shareholders of the
Company in the manner laid down in Section 81, unless the
Shareholders in a General meeting decides otherwise by passing
special resolution under section 81 (1A).
Accordingly, consent of the shareholders is being sought for issue
of Equity shares/warrants. Your Directors recommend the
resolution for approval of the shareholders.
None other Directors of the Company are concerned or interested
in the Resolution, except in capacity of member or director.
By Order of the Board of Directors
Indore, 31st August, 2010 CHAIRMAN
Registered Office :
Sayaji Hotel,
Near Kala Ghoda,
Sayajigunj, Vadodara-390005
11
Your Company has achieved a turnover of Rs. 819.75 million in the
current year against Rs. 826.04 million in the previous year.
Operating Profit (EBIDTA) for the year stood at Rs 230.84 million,
an increase of 14.68 % from Rs. 201.28 million in 2008-2009.
In order to conserve the resources and to be able to plough them
back for future growth, your Directors have not recommended any
dividend for the financial year 2009-2010.
SUBSIDIARY COMPANIES
The Financial Statements for the year ended March 31, 2010 of
Barbeque-Nation Hospitality Ltd. and Malwa Hospitality Pvt. Ltd.,
both subsidiaries of your company, are annexed to the Annual
Report.
CONSOLIDATED FINANCIAL STATEMENTS
A statement under Section 212 of the Companies Act, 1956 in
respect of the subsidiary Companies is annexed and forms an
integral part of this Report. The consolidated financial statements of
the Company and its subsidiary companies prepared in accordance
with Accounting Standards (AS)-21 and Clause 32 of the Listing
Agreement “Consolidated Financial Statement” form part of the
Annual Report and Accounts.
COURSE OF BUSINESS AND OUTLOOK
The annexed Management Discussion and Analysis forms a part of
this Report and covers, amongst other matters, the performance of
the Company during the Financial Year 2009-10 as well as the future
outlook.
2009-2010 proved to be yet another difficult year for the hospitality
industry worldwide. The `economic environment continued to be
clouded by the global financial crises. As per the World Travel and
Tourism Council("WTTC"), global GDP fell by 2.1% in real terms
during 2009. Hotel industry suffered in the wake of the economic
slowdown under review. However, your Company succeeded in
mitigating the impact to some extent by taking proactive measures
aimed at improving the efficiency and business development. Now,
with the economy showing signs of strengthening, business and
leisure travel is picking up and your Company is poised to benefit
from this trend.
PUNE HOTEL
Your Company launched the Final phase of its Pune hotel. The project
comprising of 243 rooms has many unique features. Your Company
has endeavored to offer a number of new features to discerning
customers – a luxurious Audi A7 to receive the guests from Airport to
the hotel and to drop them back at Airport; all 243 rooms equipped
with an Apple iTouch device, which becomes the single centralized
control for all gadgets within the room. Further, each of the floors is
intended to be a hotel in itself – one floor is designed for single
female traveler; one floor is dedicated to European guests and one
for Oriental visitors and so on. The hotel has received a good
response and is expected to meet the growing requirement of quality
accommodation at reasonable price in this fast growing city.
FINANCIAL RESULTS
Particulars Financial Year 2009-10 Financial Year 2008-09
Income 819.75 826.04
Less: Operating Expenses 588.91 624.76
Profit/(Loss) before Financial Charges and Depreciation. 230.84 201.28
Less: Financial Charges 129.39 71.88
Profit/(Loss) before Depreciation 101.45 129.40
Less: Amortization of Deferred Revenue Exp. 0.00 0.00
Less: Depreciation 94.37 60.25
Add: Prior Period & Extraordinary Items 0.00 7.16
Profit/(Loss) before Tax 7.08 76.31
Less: Provision for taxation 11.74 24.50
Operating profit/(Loss) after Tax (4.66) 51.80
Add: Mat Credit Entitlement 1.09 0.00
Profit after tax before Mat Credit (3.57) 51.80
Add: Balance brought forward from previous year 98.89 47.08
Balance carried to Balance Sheet. 95.32 98.89
(Figures in Rs. million)
DIRECTORS' REPORT
The Board presents the Twenty Seventh Annual Report together with the Audited Statement of Accounts and the Auditor's Report of the
Company for the year ended 31st March, 2010.
12
2. The Directors have selected such accounting policies and
applied them consistently and made judgments and estimates
that were reasonable and prudent so as to give a true and fair
view of the state of the affairs of the Company as at March 31,
2010 and of the Profit of the Company for the year under
review;
3. The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance
with the provisions of the Companies Act, 1956 for
safeguarding the assets of the Company and for preventing
and detecting fraud and other irregularities; and
4. The Directors have prepared the annual accounts of the
Company on going concern basis.
CORPORATE GOVERNANCE
A separate section on Corporate Governance and a Certificate from
the Auditors of the Company regarding Compliance of conditions of
Corporate Governance as stipulated under Clause 49 of the Listing
Agreement with the Stock Exchanges, forming part of the Annual
Report is annexed.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION ETC.
Pursuant to Section 217(1)(e) of the Companies Act 1956, read with
rules made there under, the Company is not required to give the
particulars of the conservation of energy, since the Hotel industry is
not covered under the list of Industries required to provide such
information.
The Company has not absorbed any new technology during the year
under review. The inflow and Outflow of Foreign Exchange during the
year under review is as under:
Foreign Exchange Earnings : Rs. 64.306 million
Foreign Exchange Outgo : Rs. 10.454 million
PARTICULARS OF EMPLOYEES
Information in accordance with sub-section (2A) of Section 217 of
the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975, as amended, forms part of this Report.
However, as per provision of section 219(1)(b)(iv) of the Companies
Act, 1956, the reports and the accounts are being sent to all the
shareholders of the Company excluding the statement of particulars
of employees.
Any member interested in obtaining such particulars may write to the
Company Secretary at the Registered Office of the Company.
ACKNOWLEDGMENT
Your Directors would like to express their sincere appreciation for
the co-operation and support received from shareholders, bankers,
financial institutions, regulatory bodies, customers, suppliers,
employees and other business constituents during the year under
review.
For and on behalf of the Board of Directors
Place : Indore
Date: August 31, 2010 Chairman
FOREIGN CURRENCY CONVERTIBLE BONDS (FCCBs)
The members are aware that the Company had issued /allotted
75(Seventy Five) 0.5% coupon secured Foreign Currency
Convertible Bonds(“FCCBs”) @ US$ 100,000 per Bond to Bond
Holders in their meeting held as on 28th July 2006 with the option of
conversion in to Equity shares which were due for redemption on or
before August 3, 2011.
The Acquirer had the right to convert these FCCBs into Equity Shares
during the conversion period i.e. from August 26, 2006 to July 23,
2011
M/s Clearwater Capital Partners (Cyprus) Limited (CCPCL) were the
holder of the said FCCBs and they had exercised their right to convert
those FCCBs into Equity Shares of the company at a Conversion
Price of Rs.75/-(Rupees Seventy Five Only) per Equity Share. The
exchange rate of US$ to rupee was Rs. 46.68 to one US$, being the
Federal Reserve Bank of New York’s US$ to Rupee Exchange Rate on
July 26, 2006 i.e. the date mentioned in the FCCBs Offer Circular as
the applicable date.
In order to effect Conversion of FCCBs a notice had been received
from the Bank of New York Mellon (YNY Mellon) as on date
31.03.2010 intends to convert their 75 FCCBs into 46,68,000 Equity
Shares at a price of Rs. 75.00/- per equity shares as per the FCCBs
Offer Circular and the Board of Director's of the company converted
into 46,68,000 Equity Shares @ Rs. 75/- per equity shares at their
meeting held on 10th May 2010.
The above equity shares shall be ranking pari-passu with the existing
equity shares of the company in all respect and entitled to receive the
dividend same as of the old equity shares of the company.”
DIRECTORS
Sri Munawar Garbadawala and Capt. Salim Sheikh, Directors retire
by rotation and being eligible, offer themselves for re-appointment.
The Board of Directors recommends their re-appointment as
Directors.
AUDITORS
M/s Shah Gandhi & Shah, Chartered Accountants, Auditors of the
Company, hold office until the conclusion of the ensuing Annual
General Meeting and are eligible for re-appointment. The Company
has received a letter from them to the effect that their appointment, if
made, would be within the prescribed limits under section 224 (1B)
of the Companies Act 1956.
FIXED DEPOSITS
The Company has renewed/accepted deposits by private placement
and confidential offers from friends, relatives and associates under
Section 58A of the Companies Act, 1956 in terms of Rule 4A of
Companies (Acceptance of Deposit) Rules, 1975. The Company
does not have any unpaid or unclaimed Deposits.
DIRECTORS’ RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 217(2AA) of the
Companies Act, 1956, with respect to Directors’ Responsibility
Statement, it is hereby confirmed that:
1. In the preparation of the accounts for the financial year ended
March 31, 2010, the applicable accounting standards have
been followed along with proper explanation relating to
material departures;
13
a number of proactive measures aimed at business development
and improvement of efficiencies. As a result of these measures,
your Company has been able to mitigate the impact of the adverse
situation.
INDUSTRY OUTLOOK
The outlook for the hotel industry in India, figures released by the
Finance Ministry in its Economic Survey for 2009-10 indicate that
GDP should grow by 7.2 % in the Financial Year 2010-2011 and
over 9% in the Financial Year 2011-2012. As the global economic is
showing signs of recovery and Indian economy appears to be
getting back on track. Business and leisure travel is returning back
to normalcy. WTTC has forecast that travel and tourism in India will
grow by 6.7% in 2010. The contribution of the Travel and Tourism
Industry to India's GDP in 2010 will be 8.6%. It is expected that the
industry will account for 10% of the total employment in the
country by the year end.
Demand is expected to grow as the financial year progress. The
fully opening of the Pune will ensure that the Company has the
requisite inventory of rooms to cater to this demand. Rooms rates
which were depressed during the previous Financial Year should
also begin to improve during the year. Margins are likely to be under
strain due to high inflation.
Substantial investments in tourism infrastructure are essential for
Indian hotel industry to achieve its potential. The upgrading of
national highways connecting various parts of India has opened
new avenues for the development of budget hotels in India.
OPPORTUNITIES:
1. There are signs that the global downturn may be slowly
receding. A recent editorial in the Economist (April 3rd to
April 9th, 2010) predicts that the American economy will
grow by around 3% in 2010 after shrinking by 2.4% in 2009.
2. The hotel industry has seen revival in recent times and with
the current economic policies, the industry is poised to grow.
3. Pune hotel is expected to benefit from the brand equity that
the hotel has created for itself.
4. Indore has seen lot of industrial activity in the last few years
and is still growing with developments like shopping malls,
hospitals etc. With the Government taking positive view with
regard to the setting up of IT and BPO hub in the city and
developing infrastructure, it is expected that more business
will be generated for hotel industry.
FORWARD LOOKING STATEMENTS:
This report contains forward- looking statement, which may be
identified by their use of words like 'plans', 'expects', 'will',
'anticipates', 'believes', 'intends', 'projects', 'estimates' or other
words of similar meaning. All statements that address expectations
or projections about the future, including, but not limited to
statements about the company's strategy for growth, product
development, market position, expenditure, and financial results,
are forward-looking statements. Forward-looking statements are
based on certain assumptions and expectations of future events.
The Company cannot guarantee that these assumptions and
expectations are accurate or will be realised. The Company's actual
results, performance or achievements could thus differ materially
from those projected in any such forward-looking statement. The
Company assumes no responsibility to publicly amend, modify or
revise any forward-looking statements, on the basis of any
subsequent developments, information or events.
OVERALL REVIEW
The India growth story has encouraged well established
international hotel chains to enter the country. Those already in
India are contemplating expanding their presence. The Company
welcomes such competition. It believes that healthy competition
will raise standards with the gust being the ultimate beneficiary.
Hotel industry in India has witnessed tremendous boom in recent
years. Hotel Industry is inextricably linked to both the tourism
industry and the overall business environment.
However, though the financial year 2009-10 proved to be another
difficult year for the hospitality industry worldwide. The economic
environment continued to be clouded by the global financial crises.
As per the World travel and Tourism Council ("WTTC"), global GDP
fell by 2.1% in real terms during 2009. Developed economies were
most seriously affected. Consequently, there was a decline in the
number of foreign visitors to India. The terror attacks on Mumbai in
November, 2008, leading to travel advisories by many countries,
made a difficult situation worse by restricting travel. These events
were further aggravated by the H1N1 pandemic during the first half
of the Financial Year 2009-10. Hotel industry, being largely
dependent on the overall business climate, had to bear the brunt of
this changed scenario. Restaurants business, which now forms a
significant part of Company’s business (including its subsidiary),
also was impacted to some extent on account of the prevailing
slowdown.
In a challenging environment like this, your Company had to initiate
MANAGEMENT DISCUSSION & ANALYSIS
14
steady even in the face of the economic downturn. As the economy
seems to be returning to its fast growth trajectory, business for
Company’s hotels is expected to improve. The Company has also
launched a major cost optimisation drive which is likely to bring in
reduction in operating costs.
RISKS AND CONCERNS
General Economic Conditions:
The hotel business is dependent on economic conditions globally
as well as in India. This sector was affected by the global economic
recession and its revival is dependent on several economic factors
all over the world. Local market conditions, excess hotel room
supply in some cities, reduced international or local demand for
hotel rooms, government polices and regulations on taxation, etc.
do affect the hotel business.
Risk Mitigating Initiatives
There has been considerable progress in implementing a
structured risk management framework in the Company. The
framework is now well documented with laid down dissemination
procedures: this is updated periodically.
Your Company employs various Polices and methods to counter
these risks effectively as enumerated below:-
?To reduce dependence on Indore. The Company has
launched operations in Pune and is operating off-site
restaurants in high growth cities.
?The Company plans to retire costly debt from internal
Accruals to reduce high financial leverage and also increase
profitability by reducing interest cost.
?As a policy, the Company plans to deploy most of its accruals
towards debt retirement and raise fresh funds by way of
innovative methods to fund expansion plans.
Competition
INDORE
Radisson and Fortune Landmark in Indore are determined to make
the investment a profitable one. There is also stiff competition from
outdoor banquet operators who have developed accommodation
facilities at par with star category hotels and resorts. In addition a
number of hotels with small capacities have come up. Sheraton and
other groups are coming up with their large projects in Indore.
These hotels are likely to be operational in FY 2011-12 and may
pose stiff challenge to the Company.
PUNE
Competition has intensified in almost all segments of the Indian
hotels market due to entry of new and established players and
5. Pune, one of the fastest growing cities, has seen the entry of
large number of BPO’s and IT Companies, and this may
further widen the existing demand supply gap. The revival of
global economy would potentially increase business for
these Companies, leading to more business travel to the city.
The Company’s hotel being in close promixity to the IT/BPO
units, is expected to get a good chunk of this business.
Furthermore, Pune has the most number of national level
educational and social institutions, which constantly
generate business for hotel industry.
THREATS & CHALLENGES
1. The volatility of crude oil prices is a major concern. There is
the concern of crude oil prices rising once again; this will
adversely impact travel and tourism.
2. Increase in prices of commodities like input material of food
& beverages in view of the potential drought could only be
partially offset by the Company’s cost reduction initiatives.
3. At present, the company is facing competition from some of
the national hotel chains, standalone hotel properties and
budget hotels in unorganized sector.
4. Tourism being highly sensitive industry, any adverse political
or other unforeseen unfortunate events can put a halt on the
foreign traffic movement. However, due to present upbeat
economic conditions in the country, there has been lot of
domestic corporate travel, which would counter any
adverse impact of reduced foreign traffic inflow.
5. Emergence of large hospitality chains in budget segment
may make it increasingly difficult for smaller chains to
compete.
6. Spread of diseases like Swine Flu may have a negative impact
on hotel industry and the Company’s business.
7. High inflation is also putting pressure on payroll and related
costs.
COMPANY OUTLOOK
The Company is fully committed to environmental conservation
and social responsibilities. The Hotels operated by the company are
pursuing initiatives for the betterment of the communities located
in their vicinity.
During the year under review, your Company has launched the final
phase of its Pune hotel, which has received a good response. The
Club facility in the hotel is expected to commence operations
shortly. Your Company has initiated aggressive marketing
campaign to generate business and this is likely to yield positive
results going forward. Indore and Baroda hotels have been fairly
15
expansion plans of existing ones. Your Company is aware of the
competition and is taking measures to remain competitive in the
market place. The Company’s hotel is expected to get the benefit of
brand equity enjoyed by the Company.
BARODA
Your Company’s Baroda Hotel had witnessed stiff competition from
leading Hotel chains. Several more Hotel chains have announced
plans to enter the market.
Internal control systems and their adequacy
The efficiency of the internal control systems operating in the
Company is tested and monitored on continuous basis under the a
structured Internal Audit function.Control systems at each hotel
and other business units are consistently re-engineered in line with
changing requirement through the internal audit process. The Audit
Committee periodically reviews the audit process. The focus of
these reviews has been to identify;
?Corporate policies on accounting and major processes;
?Control weaknesses and areas of improvement;
?Compliance with defined policies and processes;
?Safeguarding of tangible and intangible assets;
?Management of business and operational risks;
?Anti-fraud programme.
?Efficient operations.
Your Company has recently completed the implementation of an
ERP system. Internal processes have been mapped on the new
software to a large extent. This is expected to ensure that the
internal control systems are applied consistently and uniformly
across locations and on an ongoing basis.
Material Developments in Human Resources/Industrial
Relations
Your Company believes that its people are as much its assets as its
infrastructure and attaches the highest importance to human
resources. It focuses on developing a performance culture
throughout the organization. Some of initiatives undertaken by the
Company, in this regard are as follows:
?A major initiative has been launched recently to identify the
core values in line with the vision and mission statement of
the Company, these core values are now being inculcated in
the Company’s workforce through a series of programs.
?Performance Management System has been reviewed and
strengthened so as to measure objectively the achievement
in Key Result Areas with Variable salary package linked to
performance,
?Providing opportunities to high performers for attending
training programmes and additional exposure,
?Web-based rewarding called “GEMS (Guest Expectations
Manage and Serve) with the objective of identifying high
performers in guest services and reward innovative
suggestions to improve guest services.
Industrial relations throughout the year were cordial at all units of
the Company. As on March 31, 2010 the Company had around
1000 employees.
SAFETY, HEALTH AND ENVIRONMENT
Your Company attaches utmost importance to safety standards at
all units of the Company. At all the hotels and restaurants of the
company, necessary steps are regularly undertaken to ensure the
safety of employees, equipment and the customers. Internal safety
checks are conducted regularly. Fire fighting training is provided to
staff and mock drills are conducted gauge emergency and disaster
management preparedness.
The Company believes in good health of its employees. To pursue
this objective, efforts are being made on both treatment as well as
maintaining good health. The Company has a club and gymnasium
at its Indore facility, where the employees are allowed and
encourage participating. Yoga training course is also conducted in
the club premises. Programmes have been conducted to advice
employees on ill-effect on health due to excessive consumption of
liquor and tobacco.
The Company’s hotels maintain clean and hygeinic environment
and keep strict vigilance on their effluent generation and disposal
adhering to standard norms in order to protect the environment
and surroundings. Water recharging techniques have been
adopted to retain the ground level water.
CAUTIONARY STATEMENT
Statement made in the Management Discussion and Analysis,
describing the Company’s objectives, projection, estimates,
predications and expectations may be ‘forward-looking statement’,
within the meaning of applicable securities laws and regulations.
The Company assumes no responsibility to publicly amend, modify
or revise any forward looking statements on the basis of any
subsequent development or events or for any loss any investor may
incur by investing in the shares of the Company based on the
‘forward looking statement’.
16
MANDATORY REQUIREMENTS:
1. COMPANY’S PHILOSOPHY
Corporate Governance is based on the principles of integrity,
fairness, equity , transparency, accountability and
commitment to represents the value, ethical and moral
framework under which business decision are taken. The
investors want to be sure that not only is their capital handled
effectively and adds to the creation of wealth, but the
business decisions are also taken in a manner which is not
illegal or involving moral hazard.
The core roles of the key entities flow from this structure. The
core roles, in turn, determine the core responsibilities of
each entity. In order to discharge such responsibilities, each
entity is empowered formally with requisite powers.
In India, corporate governance practices are regulated by
Clause 49 of the Listing Agreement entered into by
companies with Stock Exchanges and the provisions of the
Companies Act, 1956.
Keeping the above in mind, your Company has also
committed itself to the philosophy of good Corporate
Governance in all its dealing, utmost integrity in its conduct
and in compliance with the highest standards of corporate
values and ethics.
Tour company consider Corporate Governance as a
continuous journey to provide a congenial environment to
harmonise the goals of maximizing the stakeholder' value
and maintaining a customer-centric focus in all dealings with
the outside world, besides keeping important segments of
the society adequately informed.
Reporting requirements as per revised Clause 49 as
applicable have been given due effect in this Report on
Corporate Governance.
2. BOARD OF DIRECTORS
In terms of the Company’s Corporate Governance policy, all
statutory and other significant and material information are
being placed before the Board to enable the Board discharge
its responsibilities of strategic supervision of the Company.
The primary role of the Board is that of trusteeship to protect
and enhance shareholder value through strategic
supervision. The Board ensures that the Company has clear
goals relating to shareholder value and its growth. The
Board, as part and parcel of its functioning, also periodically
reviews its role.
Composition of the Board.
The Sayaji Board is a balanced Board, comprising Executive
REPORT ON CORPORATE GOVERNANCEand Non-Executive Directors. As on 31st March 2010, the
Board consisted of Eight (8) Directors, out of which Two (2)
Executive and Four (4) Non- executive & Independent
Directors, who are having expertise in their respective
functional areas and capable of bringing in a wide range of
managerial skills and business and professional acumen.
During the year, Five (5) Board Meetings were held on
30/04/2009, 31/07/2009, 31/08/2009, 31/10/2009 and
29/01/2010.
Mr. Razak Dhanani Chairman 5 0 Yes
Mr. Sajid Dhanani Managing Director 5 4 No
Mr. T N Unni Independent Director 5 4 Yes
Mr. R. Sharma Nominee Director, TFCI 5 3 No
Capt. Salim Sheikh Director 5 5 No
Mr. Munawar Director 5 0 YesGarbadawala
Mr. Y.S. Mehta Nominee Director, MPFC 5 2 No
Mr. T.S. Bhattacharya Independent Director 5 1 No
Name ofDirectors
Designation
No. of Boardmeetings
held during the year2009-10
No. of BoardMeetingsattended
during theyear 2009-10
Attendance atthe last Annual
General Meetingheld on 30th
September, 2009
Detail of Directorship on the Board of other Companies as on
31/03/2010.
Name of Directors Directorship Chairmanship Chairmanshipin the board in the committees
Mr. Razak Dhanani 4 3 Nil
Mr. Sajid Dhanani 8 3 Nil
Mr. T. N. Unni 2 Nil Nil
Mr. R. Sharma 2 Nil Nil
Capt. Salim Sheikh 1 Nil Nil
Mr. Munawar Garbadawala Nil Nil Nil
Mr. Y.S. Mehta 1 Nil Nil
Mr. T.S. Bhattacharya 2 Nil Nil
3. COMMITTEES OF THE BOARD
Audit Committee
(a) Terms of reference.
The Terms of reference of the Audit Committee covers all
applicable aspects stipulated by SEBI from time to time. It is
also in full conformity to the requirements of section 292A of
the Companies Act, 1956.
(b) Composition, names of Members and Chairperson.
Name Designation
Mr. T. N. Unni Chairman of the Committee / Independent Director
Mr. R. Sharma Member / Independent Director
Capt. Salim Sheikh Member / Director
All the Directors have good financial and accounting Knowledge.
Chairman of the Committee is a Practicing Chartered Accountant.
17
Name Designation
Mr. T. N. Unni Chairman of the Committee / Independent Director
Mr. R. Sharma Member / Independent Director
Capt. Salim Sheikh Member / Director
30/04/2009 Mr. T. N. Unni Yes
Mr. R. Sharma No
Capt. Salim Sheikh Yes
31/07/2009 Mr. T. N. Unni No
Mr. R. Sharma Yes
Capt. Salim Sheikh Yes
31/08/2009 Mr. T. N. Unni Yes
Mr. R. Sharma Yes
Capt. Salim Sheikh Yes
31/10/2009 Mr. T. N. Unni Yes
Mr. R. Sharma Yes
Capt. Salim Sheikh Yes
29/01/2010 Mr. T. N. Unni Yes
Mr. R. Sharma No
Capt. Salim Sheikh Yes
Date of Meeting Members S/Shri Meetings Attended
REMUNERATION COMMITTEE
The Remuneration committee comprises of 3 Non Executive
Directors, details are given as below:
(a) Details of the remuneration paid to the Managing Director
and whole time Director for the year ended 31st March 2010.
Sri Sajid R. Dhanani, Managing Director received
remuneration of Rs. 3.009 Million
and Mr. Munawar Garbadawala, Whole time Director
received, Rs. 0.376 Million.
(b) Sitting Fees paid to Director:
Sitting fees to all the Non-Executive Directors have been paid
@ of Rs. 2000/- for attending each meeting of the Board and
committee.
SHAREHOLDERS/INVESTORS GRIEVANCE COMMITTEE
(a) Mr. T. N. Unni is the Chairman and Mr. Razak Dhanani is the
Member of the Committee.
(b) The Committee reviews the system of dealing with and
responding to correspondence from all categories of
investors. Every Complaint letter received from Stock
Exchanges/ SEBI/ Department of Company Affairs etc., and
the responses thereto are reviewed by this Committee.
(c) Complaints, if any, from investors are received either at the
Registered Office of the Company at Vadodara or at the Office
of Registrar and Transfer Agents or at the Administrative
Office of the Company at Indore.
(d) As on March 31st, 2010, there were no requests pending/
overdue beyond the due dates.
(e) The total number of complaints received and replied to the
satisfaction of the Shareholders during the year under review
were 12(Twelve) Outstanding complaints as on 31st March
2010 were Nil as per records.
(f) Name and designation of the Compliance Officer is as under:
Name : Awadhesh Gupta
Designation : Company Secretary
Share Transfer System:
The Share Transfer work is handled by Registrar and Share Transfer
Agent, M/s. Link Intime India Pvt. Limited formerly known as M/s
Intime Spectrum Registry Limited, Physical Shares for transfer are
generally transferred within statutory period if found in order. The
Committee meets regularly to review and take on record the
transfer proposals. The Committee approves the cases of Split and
consolidation of Shares Duplicate Certificate requests,
rematerialisation requests, etc.
Share Transfer Details for the period from 1st April 2009 to 31st
March 2010.
Transactions
Number of Transfers
Number of Shares Transferred
No. of Pending Share Transfers
77
17690
Demat
NIL
Total
107
22023
NIL
Physical
30
NIL
4333
(c) Meetings & Attendance: - The Audit Committee met five
times during the year 2009-10.The attendance at committee
meeting is as follows:
Year Location Date & TimeWhether Special Resolution
Passed or not
4. GENERAL BODY MEETINGS
Location and time of holding the last three AGMs.
24th AGM – 2007 Sayaji HotelOpp. Rajshree Talkies, Kala Ghoda,Sayajigunj, Vadodara. 390 005
29th September,2007at 12.30 P.M.
1. Increase in Remuneration of Managing Director 2. Issue of share Warrants convertible in to fully paid up equity shares3. Voluntary Delisting of equity shares from Madhya Pradesh Stock Exchange, &Vadodara Stock Exchange Limited, & Ahmedabad Stock Exchange 4. Investment in the excess of prescribed limit under section 372A.5. To give securities, guarantee and corporate guarantee under section 372 A.
26th AGM - 2009 Sayaji HotelOpp. Rajshree Talkies, Kala Ghoda,Sayajigunj, Vadodara. 390 005
30th September,2009at 12.30 P.M.
Nil
25th AGM - 2008 Sayaji HotelOpp. Rajshree Talkies, Kala Ghoda,Sayajigunj, Vadodara. 390 005
30th September,2008at 12.30 P.M.
To give Security, Guarantee and Corporate Guarantee forM/s Sana Hospitality Services Pvt. Ltd. as per the prescribed under section 372 A.
No other shareholders' meeting was held during the year.
18
5. DISCLOSURES
a. None of the transactions with any of the related parties
were in conflict with the interest of the Company.
b. There have been no cases of Non Compliance by the
Company imposing penalties, and strictures on the
Company by the Stock Exchanges or SEBI or any
authority on any matter related to Capital Markets
during last 3 years.
6. MEANS OF COMMUNICATION.
●The Quarterly results are published in English and
Gujarati version.
●Results are posted on the Bombay Stock Exchange
website : www.bseindia.com
●Management Discussion & Analysis is a part of the
Annual Report.
7. GENERAL SHAREHOLDER INFORMATION
a) Annual General Meeting
Day and date Thursday, September 30, 2010.
Time 12.30 P.M.
Venue Sayaji Hotels Limited
Opp: Rajshree Talkies,
Kalaghoda, Sayajigunj,
Vadodara – 390 005 (Guj.)
Date of Book Closure 27/09/2010 to 30/09/2010
b) Financial Calendar.
The Company follows the financial year from April to March.
Unaudited Financial Results for the four quarters and the
Audited Financial Results for the year ended 31st March,
2010 were taken on record and approved by the Board in its
meeting/s held on the following dates.
Quarter ended Date of Board Meeting
April-June, 2009 31st July, 2009
July-September, 2009 31st October, 2009
October-December, 2009 29th January, 2010
January-March, 2010 10th May 2010
Year ended
31st March, 2010 31st August, 2010
c) Dividend Payment Date : None
d) Registered Office : Sayaji Hotel,
Opp. Rajshree Talkies,
Kala Ghoda, Sayajigunj,
Vadodara.- 390 005.
Phone : 0265- 2363030.
Fax: 0265- 2226134
e) E-mail Address : [email protected]
f) Stock Exchanges
Name of Exchanges where shares are Listed Code
The Stock Exchange, Mumbai 523710
Ahmedabad Stock Exchange 52190
The Stock Exchange Vadodara 523710
Madhya Pradesh Stock Exchange 2729
g) ISIN No. of the Company’s : INE318C01014
Equity Shares held in Demat Form : 10119685
Equity Shares held in Physical Form : 2730315
h) Depository Connectivity : NSDL & CDSL
i) Registrar and Transfer Agents :
Head Office & Correspondence Address
Link Intime India Pvt. Limited
C-13, Pannalal Silk Mills Compound,
L.B.S.Marg, Bhandup (W), Mumbai-400 078
E-mail: [email protected]
Phone (022)25963838
Fax: 25946969
j) Address for Investor’s Correspondence
Sayaji Hotel.
H-1, Scheme No. 54, Vijaynagar, Indore.
Phone: 0731- 4003636/ 4006666
Fax: 0731- 4003131
E-mail : [email protected]
K) The Company has not raised Equity Share Capital in the
Financial Year 2009-10.
l) Dematerialization of Shares:
As on 31st March 2010, 10119685 shares stands
dematerialized representing 78.75 % of the total shares of
the Company.
m) Project Locations:
- Sayaji Hotel, Indore, Madhya Pradesh.
- Sayaji Hotel, Vadodara, Gujarat.
- Sayaji Hotel, Pune, Maharashtra.
19
n) Categories of shareholdings as on 31st March 2010:
CategoryNo. of
Shares Held
% ofShare-holding
Promoters: 66,74,105 51.94
Directors and Relatives 100 0.00
Public:
1. Institutions:
a. Mutual Funds and UTI 96,015 0.75
b. Banks and Financial Institution 300 0.00
c. Central Govt./State Govt./ Venture
Capital Funds/Insurance Companies 0 0.00
d. Foreign Institutional Investors 13,95,747 10.86
e. Foreign Venture Capital Investors 10,89,891 8.48
2. Non Institutional Investors
a. Bodies Corporate 10,26,444 7.99
b. Individuals(Public) 12,63,694 9.83
c. NRI/OCB 12,56,721 9.78
d. Clearing Member 46,983 0.37
TOTAL 1,28,50000 100.00
o) Stock Market Data.
April 09 55.00 30.20 11403.25 9901.99
May 09 55.80 39.15 14625.25 11682.99
June 09 70.00 39.55 15466.81 14265.53
July 09 47.90 38.00 15670.31 13400.32
August 09 48.85 43.00 15924.23 14784.92
September 09 70.75 45.10 17126.84 15398.33
October 09 65.50 49.70 17326.01 15896.28
November 09 74.00 49.25 17198.95 15404.94
December 09 93.60 66.60 17464.81 16601.20
January 10 78.50 68.00 17701.13 16289.82
February 10 78.15 70.00 16496.05 15790.93
March 10 118.85 72.50 17711.35 16772.56
Sources : Data Compiled from BSE official website
MonthMumbai Stock Exchange Ltd. BSE SENSEX
High Low High Low
20
CERTIFICATE
To
The Members of
Sayaji Hotels Ltd
Vadodara
We have examined the Compliance of the conditions of Corporate Governance by Sayaji Hotels Limited for the year ended March 31, 2010 as stipulated in Clause 49 of listing Agreement of the said Company with Stock exchanges in India.
The Compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to the procedure and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statement of the Company.
In our opinion and to the best of our information and explanation given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.
We further state that such compliance is neither an assurance as to the further viability of the Company nor the efficiency or effectiveness with which the Management has conducted the affairs of the Company.
For SHAH GANDHI & SHAH
Firm Regn. No. 126862W
Chartered Accountants
Vadodara Nimesh Gandhi
27th August, 2010 Partner
M.No. 49134
21
22
AUDITORS REPORT'
For SHAH GANDHI & SHAH
Firm Regn. No. 126862W
Chartered Accountants
Vadodara Nimesh GandhiAugust 31, 2010 Partner
M.No. 49134
To
THE MEMBERS OF
SAYAJI HOTELS LIMITED
VADODARA
We have audited the attached Balance Sheet of SAYAJI HOTELS
LIMITED as at 31st March, 2010 and also the Profit & Loss
Account and Cash Flow Statement 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 as
amended by Companies (Auditor’s Report) (Amendment) Order
2004 (together “the Order”), issued by the Central Government
of India in terms of sub-section (4A) of section 227 of the
Companies Act, 1956, 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 in above
paragraph, we report that:
(i) We have obtained all the information and explanations,
which to the best of our knowledge and belief were
necessary for the purposes of our audit;
(ii) 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;
(iii) The Balance Sheet and Profit and Loss Account and Cash
Flow Statement dealt with by this report are in agreement
with the books of account;
(iv) In our opinion, the Balance Sheet and Profit and Loss
Account and Cash Flow Statement dealt with by this report
comply with the accounting standards referred to in sub-
section (3C) of section 211 of the Companies Act, 1956;
(v) On the basis of written representations received from the
directors, as on 31st March, 2010, and taken on record by
the Board of Directors, we report that none of the directors
are disqualified as on 31st March, 2010 from being
appointed as a director in terms of clause (g) of sub-
section (1) of section 274 of the Companies Act, 1956;
(vi) 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 as per Schedule 16 and other notes thereon
appearing in Schedule 16, 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:
a. in the case of the Balance Sheet, of the state of
affairs of the Company as at 31st March, 2010; and
b. in the case of the Profit & Loss Account, of the loss
of the Company for the year ended on that date., and
c. in the case of the Cash Flow Statement, of the cash
flows for the year ended on that date.
23
ANNEXURE TO AUDITOR’S REPORT
(Referred to in paragraph 3 of our report of even date on the
accounts for the year ended on 31st March, 2010 of Sayaji
Hotels Limited.)
As required by the Companies’ (Auditors’ Report) Order, 2003,
issued by the Company Law Board in terms of Section 227 (4A)
of the Companies Act, 1956 and on the basis of such checks of
books and records of the Company as we considered
appropriate and the information and explanations given to us
during the course of the audit, we report as under:
1. (a) The records of the Company in respect of fixed
assets needs to be updated in respect of additions,
quantitative details, identification numbers,
valuation, etc.
(b) We are informed that the Fixed Assets of the
Company have been physically verified by the
Management during the year at reasonable intervals
and no material discrepancy has been noticed on
such verification.
(c) The assets disposed off during the year are not
significant and therefore do not affect the going
concern assumption.
2. (a) Stocks of Food & Beverages, Stores, and Operating
Supplies etc. have been physically verified by the
management during the year. In our opinion,
frequency of verification is reasonable.
(b) In our opinion and according to the information and
explanations given to us, the procedures of physical
verification of stocks followed by the management
were reasonable and adequate in relation to the size
of the Company and the nature of its business.
(c) In our opinion the Company has maintained proper
records of inventory. The discrepancies noticed on
such physical verification of stocks as compared to
book records were not significant and the same has
been properly dealt with in the books of accounts.
3. (a) Company has granted loans to 3 companies, firms
or other parties covered in the register maintained
under section 301 of the Act., where in the balance
payable as at the year end is Rs. 228.05 lacs. The
maximum amounts involved in the transactions
during the year are Rs. 4.43 lacs.
(b) The loans granted are interest free and are repayable
on demand.
(c) There is no overdue amount of loans granted to
companies, firms or other parties since they have
not been called up for repayment.
(d) The Company has not taken any loans from firm
covered in the register maintained under section
301 of the Act, where in the balance payable as at the
year end is Rs. Nil lacs.
4. In our opinion and according to the information and
explanations given to us, there is adequate internal
control system commensurate with the size of the
company and the nature of its business with regard to the
purchase of stores, operating supplies, components,
plant and machinery, equipments and other assets and for
the sale of goods and services.
5. (a) According to the information and explanations
given to us, we are of the opinion that the particulars
of the contracts or arrangements refereed to in
section 301 of the Companies Act, 1956 have been
so entered.
(b) In our opinion according to the information and
explanations given to us, the transactions made in
pursuance of such contracts or arrangements have
been made at prices which are reasonable having
regard to prevailing market prices at the relevant
time.
6. In our opinion and according to the information and
explanations given to us, the Company, with regards to
the deposits accepted from the public, has complied the
provisions of the section 58A, 58AA or any other relevant
provision of the Companies Act, 1956 and the Companies
(Acceptance of Deposits) Rules, 1975.
7. The Company has system of internal audit which, in our
opinion, is commensurate with the size of the business.
8. Central Government has not prescribed maintenance of
the cost records under section 209(1)(d) of the
companies Act 1956 for the Company.
9. (a) According to the records, information and
explanations provided to us of the company is
generally regular in depositing, with appropriate
authorities undisputed amount of Provident Fund,
investor education fund, Employees’ State
24
Insurance, income tax, sales tax, wealth tax, service
tax, custom duty, excise duty, cess and other
statutory dues applicable to it and no undisputed
amounts payable were outstanding as at 31st
March, 2010 for the period of more than six months
from the date they became payable.
(b) The following are the details of disputed Income
Tax, Sales Tax, Wealth Tax, Service Tax, Customs
Duty, Excise Duty and Cess that have not been paid
to the concerned authorities :
10. Based on our audit procedures and on the information and
explanation given by management, the company has not
defaulted in repayment of dues to the financial institution,
bank or debenture holders as at the balance sheet date:
11. Based on our audit procedures and the information and
explanation given to us, the company has not granted
loans and advances on the basis of securities by way of
pledge of shares, debentures and other securities.
12. The Company is not a chit/ nidhi /mutual benefit fund/
society and clause XIII of the order is not applicable.
13. The Company is not dealing or trading in shares,
securities, debentures and other investments.
14. On the basis of the information and explanation given to
us the company has given guarantees for the loans taken
by other company from bank or financial institution and
are not prejudicial to the interest of the Company.
15. Based on our audit procedures and explanation given to
us the term loans have been applied for the purpose for
which they were raised.
16. On the basis of our examination of the Balance Sheet of
the Company and the information and explanation given
NAME OF THE
STATUTORY DUESFORUM WHERE DISPUTE
IS PENDING
UNPAID AMOUNT
(Rs.)
01
02
03
04
Service Tax
Luxury Tax
VAT
Entry Tax
Tribunal
Dy. Commr. VAT tax, Indore
Dy. Commr. VAT tax, Indore
Dy. Commr. VAT tax, Indore
Rs. 256.78 lacs Tax
Rs. 256.78 lacs Penalty
Rs. 148.35 lacs Interest
Rs. 41.13 lacs
Rs. 20.73 lacs
Rs. 04.64 lacs
to us, we are of the opinion that the funds raised on short-
term basis have not been used for long-term investment.
17. During the year, The company has not made any
preferential allotment of share to parties and companies
covered in the Register maintained under section 301 of
the Act.
18. The Company has not issued any debentures during the
year.
19. The Company has not raised any money by public issues
during the year.
20. Based on the audit procedures performed and
information and explanations given to us by the
management, we report that no fraud on or by the
company has been noticed or reported during the course
of our audit.
For SHAH GANDHI & SHAH
Firm Regn. No. 126862W
Chartered Accountants
Vadodara Nimesh GandhiAugust 31, 2010 Partner
M.No. 49134
25
BALANCE SHEET AS AT 31-03-2010
I. SOURCES OF FUNDS
(1) Shareholders' Funds
(a) Share Capital 1 1,285.00 1,285.00
(b) Reserves & Surplus 2 4,505.08 4,140.75
(c) Share Warrants of --- 5,790.08 400.08 5,825.83 (See note 19 of Part B of Sch.16)
(2) Loan Funds
(a) Secured Loans 3 12,964.13 13,591.29
(b) Unsecured Loans 4 4,055.33 17,019.46 4,020.93 17,612.22
(3) Deferred Tax (See note 6 of Part B of Sch.16) 792.62 748.90
TOTAL 23,602.16 24,186.95
II. APPLICATION OF FUNDS
(1) Fixed Assets 6
(a) Gross Block (Original Cost) 23,417.93 19,537.79
(b) Less : Depreciation (3,995.79) (3,054.80)
(c) Net Block 19,422.14 16,482.99
(d) Capital Work in Progress 6 --- 1,909.36
(e) Expenditure during Construction 6 24.91 558.50
Period pending allocation
(2) Investments 7 1,467.78 1,464.70
(3) Current Assets, Loans and Advances 8 3,980.91 5,545.74
Less: Current Liabilities & Provisions 5 (1,293.58) (1,774.34)
Net Current Assets 2,687.33 3,771.40
TOTAL 23,602.16 24,186.95
Significant Accounting Policies 16
Notes on Accounts 16
(Rs. In lacs)
SchAS AT
31/03/10AS AT
31/03/09
Schedules referred to above form an integral partof the Balance SheetAs per our report of even date attached For SHAH GANDHI & SHAHFirm Regn. No. 126862WChartered Accountants
Nimesh GandhiPartnerM.No. 49134
VADODARA : 31st August 2010
For and on behalf of the Board of Directors
INDORE : 31st August 2010
Sajid R Dhanani Managing Director
Capt. Salim SheikhDirector
M.F. GarbadwalaDirector
Awadhesh GuptaCo. Secretary
26
PROFIT & LOSS ACCOUNT FOR THE YEAR 01.04.2009 TO 31.03.2010
I. INCOME
Rooms, Restaurants, Banquets, Shops 9 8,141.57 8,218.54
and Other Services
Other Income 10 55.98 41.92
TOTAL 8,197.55 8,260.46
II. EXPENDITURE
Food and Beverages materials consumed 11 1,688.69 2,360.72
Operating Expenses 12 1,064.54 821.01
Power and Fuel 12 717.00 744.97
Employees' Emoluments 13 1,150.02 1,175.51
Selling & Administrative Exps. 14 1,268.88 1,145.43
5,889.13 6,247.64
III. OPERATING PROFIT BEFORE INTEREST 2,308.42 2,012.82
Financial Charges 15 1,293.91 718.80
IV. PROFIT/ (LOSS) BEFORE DEPRECIATION 1,014.51 1,294.02
Depreciation 947.42 603.81
Add : Depreciation Written Back 3.68 1.28
V. PROFIT/ (LOSS) BEFORE TAX & PRIOR PERIOD & 70.77 691.49
EXTRAORDINARY ITEMS
LESS : PRIOR PERIOD & EXTRAORDINARY ITEMS --- (71.61)
VI. PROFIT/ (LOSS) BEFORE TAX 70.77 763.10
VII. PROVISION FOR TAXATION
CURRENT TAX 73.73 93.09
DEFERRED TAX 43.72 144.13
FRINGE BENEFIT TAX --- 7.83
VIII. PROFIT/ (LOSS) AFTER TAX BEFORE MAT CREDIT (46.68) 518.06
IX. Add : MAT CREDIT ENTITLEMENT
CURRENT YEAR 10.93 ---
X. PROFIT/ (LOSS) AFTER TAX (35.75) 518.06
XI. BALANCE B/FORWARD FROM LAST YEAR 988.95 470.89
XII. AMOUNT AVAILABLE FOR APPROPRIATION 953.20 988.95
XIII. AMOUNT CARRIED TO BALANCE SHEET 953.20 988.95
31-Mar-10Sch 31-Mar-09
Schedules referred to above form an integral partof the Balance SheetAs per our report of even date attached For SHAH GANDHI & SHAHFirm Regn. No. 126862WChartered Accountants
Nimesh GandhiPartnerM.No. 49134
VADODARA : 31st August 2010
For and on behalf of the Board of Directors
INDORE : 31st August 2010
Sajid R Dhanani Managing Director
Capt. Salim SheikhDirector
M.F. GarbadwalaDirector
Awadhesh GuptaCo. Secretary
(Rs. In lacs)
27
SCHEDULE - 1 : SHARE CAPITAL
AUTHORISED
20,000,000 Equity Shares of Rs.10/- each 2,000.00 2,000.00
1,000,000 Preferance Shares of Rs.100/- each 1,000.00 1,000.00
TOTAL 3,000.00 3,000.00
ISSUED, SUBSCRIBED & PAID-UP
12850000 (12850000) Equity
Shares of Rs. 10/- each 1,285.00 1,285.00
TOTAL 1,285.00 1,285.00
SCHEDULE - 2 : RESERVES & SURPLUS
(i) Share Premium
Opening at beginning 2,910.40 2,910.40
Addition during the year --- ---
Utilised during the year --- ---
Closing at end 2,910.40 2,910.40
(ii) General Reserve
Opening at beginning 241.40 241.40
Addition during the year 400.08 ---
(See note 19 of Part B of Sch.16)
Utilised during the year --- ---
Closing at end 641.48 241.40
TOTAL (i+ii) 3,551.88 3,151.80
(iv) Profit & Loss Account
Opening at beginning 988.95 470.89
Addition during the year (35.75) 518.06
Closing at end 953.20 988.95
GRAND TOTAL 4,505.08 4,140.75
SCHEDULE - 3 : SECURED LOANS
(Refer Note 1 of Part B of Schedule 16)
Term Loans 12,345.99 13,469.87
Asset Credit Finance 148.73 121.42
Working Capital Loans 469.41 ---
TOTAL 12,964.13 13,591.29
SCHEDULES FORMING PART OF THE BALANCE SHEET
As at31/03/10
As at31/03/09
(Rs. In lacs)
28
SCHEDULE - 4 : UNSECURED LOANS
Foreign Currency Convertible Bonds
From Foreign Companies 3,501.00 3,501.00
(See Note 18 of Part B of Schedule 16)
Fixed Deposits :
From Public 510.22 216.32
Other Loans :
From Others 27.73 40.51
From Financial Institution --- 200.00
From Trade Deposit 16.38 44.11 63.10 303.61
TOTAL 4,055.33 4,020.93
SCHEDULE - 5 : CURRENT LIABILITIES &
PROVISIONS
Current Liabilities
Sundry Creditors 913.71 1,372.37
Interest Acc.but not due 119.58 1,033.29 150.10 1,522.47
(due within 12 months)
Provision -
Taxation 160.32 149.39
Others 99.97 260.29 102.48 251.87
TOTAL 1,293.58 1,774.34
As at31/03/10
As at31/03/09
(Rs. In lacs)
SC
HED
ULE
- 6
: F
IXED
AS
SET
S(R
s. in
lacs
)
Sr.
No.
PA
RTI
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---
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---
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--
19.
36
31.
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27.
66
31.
32
TOTA
L 1
9,53
7.79
3
,887
.15
7.0
1 2
3,41
7.93
3
,054
.80
6.4
3 9
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14
16,
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99
PR
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R F
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12,
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39
7,3
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71.
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0 3
,880
.15
24.
91
PER
IOD
01.
04.0
9 TO
31.
03.1
0
29
30
SCHEDULE - 7 : INVESTMENT
TRADE INVESTMENTS - AT COST
UnQuoted :
Barbeque-Nation Hospitality Ltd 854.00 854.00
6464998 Equity Shares
of Rs. 10 each fully paid up
Malwa Hospitality Pvt. Ltd. 549.40 549.40
5494000 Equity Shares
of Rs. 10 each fully paid up
Welterman International Ltd. 26.30 26.30
2,63,000 Equity Shares of Rs. 10
each fully paid up
Bharat Equity Services Ltd. 10.00 10.00
1,00,000 Equity Shares of Rs.10
each fully paid up
Aries Hotels Pvt. Ltd. 25.00 25.00
2,50,000 Equity Shares of Rs.10
each fully paid up
Annoya Sahakari Mandali Co-Op Bank Ltd 0.01 0.01
50 Equity Shares of Rs.10 each fully
paid up
Axis Bank Limited - Equity Fund 3.07 ---
TOTAL 1,467.78 1,464.70
SCHEDULE - 8 : CURRENT ASSETS, LOANS
& ADVANCES
CURRENT ASSETS
Inventories
Operating Supplies 394.38 292.05
(Valued at cost as certified by Management)
Food and Beverage 133.65 81.63
(Valued at cost as certified by Management)
Shopping Arcade Stock (at cost) 42.54 570.57 42.54 416.22
Sundry Debtors (Unsecured considered good)
Outstanding Over Six Months 288.79 255.49
Others 444.29 733.08 278.55 534.04
As at31/03/10
As at31/03/09
(Rs. In lacs)
31
Cash and Bank Balances
Cash on hand 25.43 24.77
Bank Balances
With Scheduled Banks
In Current Accounts 211.90 98.26
In Fixed Deposit Account 103.05 340.38 51.76 174.79
LOANS AND ADVANCES (Unsecured,
Considered good unless otherwise
specified)
Advances recoverable in cash or in
kind or for value to be received 1,911.42 4,064.18
Mat Credit Entitlement 148.23 137.29
Advance Tax & TDS Receivable 277.23 2,336.88 219.22 4,420.69
TOTAL 3,980.91 5,545.74
As at31/03/10
As at31/03/09
(Rs. In lacs)
32
SCHEDULE - 09 : ROOMS, RESTAURANTS, BANQUETS, SHOPS
AND OTHER SERVICES
Rooms 2,907.17 1,855.29
Food and Beverages 3,395.23 5,503.94
Other Services 1,839.17 859.31
TOTAL 8,141.57 8,218.54
SCHEDULE - 10 : OTHER INCOME
Interest Earned 32.35 24.53
Miscellaneous Income 23.63 17.39
TOTAL 55.98 41.92
SCHEDULE - 11 : FOOD AND BEVERAGES MATERIALS CONSUMED
Opening Stock 81.63 80.78
Add : Purchases 1,740.71 2,361.57
1,822.34 2,442.35
Less : Closing Stock 133.65 81.63
TOTAL 1,688.69 2,360.72
SCHEDULE - 12 : OPERATING EXPENSES
Stores and Operating Supplies 773.07 565.23
Repairs and Maintenance
Building 76.85 84.84
Plant & Machinery 41.30 48.14
Others 70.90 74.25
Laundry Expenses 102.42 48.55
SUB-TOTAL 1,064.54 821.01
Power and Fuel 717.00 744.97
GRAND TOTAL 1,781.54 1,565.98
31-Mar-10 31-Mar-09
SCHEDULES FORMING PART OF THE PROFIT & LOSS ACCOUNT (Rs. In lacs)
33
SCHEDULE - 13 : EMPLOYEES' EMOLUMENTS
Salaries, Wages and Allowances 1,004.16 1,060.10
Contribution to P.F. and other Funds 76.87 64.48
Workmen and Staff Welfare Expenses 48.90 17.60
Workmen and Staff Uniform Expenses 20.09 33.33
TOTAL 1,150.02 1,175.51
SCHEDULE - 14 : SELLING AND ADMINISTRATIVE EXPENSES
Rent/Lease Rent 443.73 462.78
Rates & Taxes 80.22 108.40
Insurance 18.36 12.15
Legal & Professional 53.37 44.80
Travelling and Conveyance 35.98 43.74
Postage, Telegram and Telephones 39.19 41.96
Advertisement and Publicity 95.95 29.58
Printing and Stationery 51.17 49.26
Directors' Sitting Fees 0.45 0.49
Donation 2.71 0.53
Guest pick up Expenses 169.87 85.60
Other Expenses 180.27 94.36
Water charges 18.28 47.62
Housekeeping Expenses 76.83 27.22
Audit Fees 2.50 2.37
Bad Debts Written Off --- 94.57
TOTAL 1,268.88 1,145.43
SCHEDULE - 15 : FINANCIAL CHARGES
Interest on term Loan 1,109.01 581.73
Interest on Others 75.52 37.28
Bank Charges 109.38 55.07
Restructuring & Processing Fees --- 44.72
TOTAL 1,293.91 718.80
31-Mar-10 31-Mar-09
(Rs. In lacs)
34
S C H E D U L E - 1 6 : N O T E S T O A C C O U N T S
A. SIGNIFICANT ACCOUNTING POLICIES
a) Convention :
i. The financial statements have been prepared under the historical cost convention and on the basis of going concern, in
accordance with the generally accepted accounting principles and provisions of the Companies Act 1956.
ii. The Company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on
accrual basis.
iii. Where changes in presentation are made, comparative figures for the previous year are regrouped accordingly.
b) Fixed Assets :
i. Accounted at acquisition cost including directly attributable costs such as freight, insurance and specific installation charges for
bringing the asset to its working condition for use.
ii. Expenditure relating to existing fixed assets is added to the cost of the assets where it increases the performance/life of the assets
as assessed earlier.
iii. Fixed assets are eliminated from financial statements, either on disposal or when retired from active use. Generally, such retired
assets are disposed of soon thereafter.
iv. Pre-operative expenses, including interest on specific loans for the projects incurred till the projects are ready for Commercial
Operation, are capitalised.
v. Expenditure on the new projects are included in Capital Work-in-Progress.
c) Depreciation :
i. Depreciation is charged on fixed assets except on Freehold & leasehold land and buildings (in respect of restaurant chain
business) as per the straight-line method at the rates and in the manner prescribed under Schedule XIV to the Companies Act,
1956.
ii. Buildings (in respect of the restaurant chain business) constructed on the rented properties are depreciated over the term of the
respective leases.
iii. Assets like vehicles, computers etc. utilized during the construction period are not depreciated till the project is ready.
iv. Computer software and licence are depreciated over a period of three years.
v. Liquor licences purchased for restaurant chain business are depreciated over the period of lease term of the respective
restaurants.
d) Investments :
Long term Investments are stated at cost of acquisition including brokerage, stamp duty, fees, if any.
e) Inventories :
i. Inventories are valued at cost or replacement value, whichever is less, after providing for obsolescence and damage.
ii. In the case of raw materials, operating supplies and stores, cost represents purchase price and other costs incurred for bringing
inventories upto their locations and are determined on First-In-First-Out basis.
f) Sales :
Sales is exclusive of Luxury tax, Sales tax, Service Tax and other taxes.
g) Accounting for Provisions, Contingent Liabilities and Contingent Assets :
A provision is recognized when the Company has a present obligation as a result of past event and it is probable that an outflow of
resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Accounting for contingencies
(gains and losses) arising out of contractual obligations, are made only on the basis of mutual acceptances.
35
h) Events occurring after the date of Balance Sheet date :
Where material, events occurring after the date of Balance Sheet are considered up to the date of adoption of the accounts.
i) Employee Benefit :
Employee benefit plans comprise both defined benefit and defined contribution plans.
Gratuity liability is a defined benefit obligation and is provided for on the basis of an actuarial valuation on projected unit credit method
made at the end of each financial year. Actuarial gains/ losses are immediately taken to profit and loss account and are not deferred.
Provident fund is a defined contribution plan. Each eligible employee and the company make contributions at a percentage of the basic
salary specified under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. The Company’s contributions are
charged to the profit and loss account of the year when the contributions to the respective funds are due. The company has no further
obligations under the plan beyond its periodic contributions.
j) Taxation :
i. Provision for current taxation has been made in accordance with the Income Tax Laws applicable to the assessment year.
ii. Deferred Tax is recognized on timing difference being the difference between taxable income and accounting income that
originate in one period and are capable of reversal in one or more subsequent periods. Where there is unabsorbed depreciation
or carry forward losses, deferred tax assets are recognized only if there is virtual certainty of realization of such assets. The effect
on deferred tax assets and liabilities of a change in tax rates is recognized in income using the tax rates and tax laws that have
been enacted or substantively enacted by the balance sheet date.
iii. In accordance with the Guidance Note on Accounting for credit available in respect of MAT under the Income Tax Act,1961 issued
by the ICAI and in view of convincing evidences of the entitlement of credit of the MAT, the current years’ MAT provision has been
recognised and credited to the Profit & Loss Account.
k) Foreign Currency transactions :
Foreign currency transactions are accounted at the rate prevailing on the date of transaction. Gain or loss arising out of
translation/conversion is taken credit for or charged to the Profit & Loss Account.
Exchange difference arising due to repayment or restatement of liabilities incurred for the purpose of acquiring fixed assets are
adjusted in the carrying amount of the respective fixed assets.
l) Assets taken on lease :
i. In respect of finance lease transactions, lease rents paid are charged to the Profit and Loss Account in accordance with the terms
of the lease agreements.
ii. In respect of operating lease transactions, the assets are not capitalized in the books of the Company and lease payments are
charged to the Profit and Loss Account.
m) Borrowing Costs :
Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such
assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs
are charged to revenue.
n) Impairment of Assets :
An asset is treated as impaired when the carrying cost of the asset exceeds its recoverable value. An impairment loss is charged to the
Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting
period is reversed if there has been a change in the estimate of recoverable amount.
36
B. NOTES ON ACCOUNTS
1. Secured Loans :
a) Term Loans of Rs. 20.95 crores from Tourism Finance Corporation of India Ltd. (TFCI) are secured on pari- passu basis by way
of mortgage of land and building at Indore, Pune & Vadodara and hypothecation of the movables, present and future, except
stocks of all kinds including operating supplies, stores, and spares offered to the bankers for securing the working capital loans.
b) Term Loan of Rs. 4.93 crores from HUDCO is secured on pari- passu basis by way of mortgage of land and building at Indore,
Pune & Vadodara and hypothecation of the movables, present and future, except stocks of all kinds including operating supplies,
stores, and spares offered to the Bankers for securing the working capital form.
c) Term Loans of Rs. 7.40 crores from Madhya Pradesh Financial Corporation (MPFC) are secured by way of mortgage of land and
building at Indore and/ hypothecation of the movable, present and future, except stocks of all kinds including operating supplies,
stores and spares offered to the Bankers for securing the working capital finance. Term loan of Rs.7.50 Crores is secured by way
of hypothecation of the movable, present and future, except stocks of all kinds including operating supplies, stores and spares
offered to the Bankers for securing the working capital finance. The equitable mortgage for this loan is yet to be created.
d) Term Loans of Rs. 54.60 crores from State Bank of India of are secured by way of mortgage of land and building at Indore,
Vadodara & Pune and hypothecation of movables, present and future, except stocks of all kinds including operating supplies and
spares offered to the Bankers for securing the working capital finance.
e) Term Loan of Rs. 2.00 crores from State Bank of India is securitized against the lease rent receivables of Nokia India (P) Ltd. at
Indore.
f) Term Loans of Rs. 29.75 crores from State Bank of Indore are secured by way of mortgage of land and building at Indore,
Vadodara & Pune and hypothecation of movables, present and future, except stocks of all kinds including operating supplies and
spares offered to the Bankers for securing the working capital finance.
g) Term Loan of Rs. 11.50 crores from State Bank of Mysore is secured by way of mortgage of land and building at Indore, Vadodara
& Pune and hypothecation of movables, present and future, except stocks of all kinds including operating supplies and spares
offered to the Bankers for securing the working capital finance.
h) Term Loan of Rs. 6.75 crores from Axis Bank Ltd is secured by way of mortgage of land and building at Indore, Baroda & Pune
and hypothecation of the movable, present and future, except stocks of all kinds including operating supplies, stores and spares
offered to the Bankers for securing the working capital finance.
i) Working Capital Term Loan of Rs. 1.25 crores from Axis Bank Ltd is secured by first charge by way of hypothecation of stocks of
food, beverages, operating supplies stores, spares, book debt of the company and also by way of second charge on the
immovable properties of the company.
j) Working Capital Medium Term Loan of Rs.1.50 crores from Madhya Pradesh Financial Corporation (MPFC) is secured by way of
mortgage of Shops at Sayaji Plaza, Indore.
k) Cash credit facilities of Rs. 6.25 crores State Bank of India is secured by first charge by way of hypothecation of stocks of food,
beverages, operating supplies, stores, spares, book-debts (excluding credit card receivables), bills etc. of the company and also
by way of a second charge on the immovable properties of the company at Indore, Baroda and Pune.
l) Cash credit facilities of Rs. 1.50 crores from Axis Bank Ltd. is secured by first charge by way of hypothecation of stocks of food,
beverages, operating supplies, spares and book debts, bills etc. of the company and also by way of a second charge on the
immovable properties of the company at Indore, Baroda and Pune.
m) Corporate loan of Rs.16.00 crores from Axis Bank Ltd. is secured by first charge by way of hypothecation of stocks of food,
beverages, operating supplies, stores, spares, book-debts, bills etc. of the company and also by way of a Second charge on the
immovable properties of the company at Indore and Baroda.
37
n) Vehicle loans from ICICI Bank Ltd. are secured by way of hypothecation charge on the specific vehicles.
o) Vehicle loans from HDFC Bank Limited are secured by way of hypothecation charge on specific vehicles.
p) Vehicle loans from Axis Bank Ltd. are secured by way of hypothecation charge on specific vehicles.
q) All term loans except vehicle loans from ICICI Bank Limited,HDFC Bank Limited and Axis Bank Ltd. are personally guaranteed by
some of the director of the company.
r) Installment falling due within next 12 months Rs. 2501.83 Lacs.
2. Contingent Liabilities not provided for :
a) Guarantees given on behalf of other companies - Rs. 5621.82 lacs
(Previous year Rs. 520 lacs)
b) Disputed statutory liabilities in respect of service tax not provided for : (Rs. In lacs)
31.03.10 31.03.09
i) Tax Demanded 256.78 127.33
ii) Penalty thereon 256.78 127.33
iii) Interest (to be levied in case of confirmation of demand) 148.35 16.34
iv) Total 661.91 271.00
The matters are pending before the hon’ble CESTAT, New Delhi. The Company has got stay order against the tax demand of
Rs.127.33 lacs.
c) Customs duties saved against imports under EPCG scheme - Rs. 750.38 lacs (Previous year Rs. 695.30 lacs)
d) Claims against the company not acknowledged as debt : Rs. 5.06 lacs
e) Disputed liability in respect of :
i. Luxury Tax Rs. 41.13 lacs pertains to tax deposited not considered at the time of assessment and interest charged
thereon.
ii. Vat Tax Rs. 20.73 lacs pertains to Input tax rebate of exemption period being adjusted against presumptive tax of
exemption period.
iii. Entry Tax Rs. 4.64 lacs pertains to entry tax on some items which were considered taxable in the assessment.
The above matters are pending before Deputy Commissioner Vat Tax, Indore.
3. During the year under review, company was not engaged in the business of developing and selling of properties, hence the
Company has not provided primary segmental information for these segments as per Accounting Standard–17 on "Segment
Reporting" issued by the ICAI.
4. The Company adopted the Accounting Standards 15 "Employee Benefits" effective from April 1, 2007.
Defined contribution plans : During the year the Company has recognized the following amounts in the Profit and Loss account,
which are included in "Contribution to PF and other funds" in Schedule 13 :
31.03.10 31.03.09
i) Contribution to Provident Fund Rs. 76.87 lacs Rs. 64.48 lacs
Defined Benefit Plans : The Company makes annual contributions to the Employee’s Group Gratuity scheme of the SBI Life
Insurance Co. Ltd., a funded defined benefit plan for the qualifying employees. The scheme provides for lump sum payment to
vested employees at retirement, death while in employment or on termination of employment as per the terms of the scheme.
Vesting occurs upon completion of five years of service.
38
i) Changes in benefit obligations :
Present value of obligation as at the beginning of the year 4730414 4312162
Interest Cost 378433 344973
Current Service Cost 919210 764638
Actuarial (gain)/ loss on obligations 485749 (325769)
Benefit paid (307011) (365590)
Present value of obligation as at the end of the year 6206795 4730414
ii) Change in plan assets :
Fair value of plan assets as at the beginning of the year 1302494 1553711
Expected return on plan assets 104200 109673
Contributions Nil Nil
Benefits paid Nil (365590)
Actuarial gain/ (loss) on plan assets (307668) 4700
Fair value of plan assets at the end of the year 1099026 1302494
Excess of (obligation over plan assets)/ plan asset over obligation (5107769) (3427920)
(Accrued liability)/ Prepaid benefit (5107769) (3427920)
iii) Net Gratuity and other cost at the end of the year
Current Service cost 919210 764638
Interest on defined benefit obligation 378433 344973
Expected return on plan assets (104200) (109673)
Net actuarial gain recognized in the year 793417 (330469)
Net gratuity and other cost 1986860 669469
Actual return on plan asset (203468) 114373
iv) Category of Assets at the end of the year
Insurer Managed Funds 1099026 1302494
Others Nil Nil
Total 1099026 1302494
v) Assumptions used
Discount rate (p.a.) 8% 8%
Salary escalation rate (p.a.) 5% 5%
Expected rate of return on plan assets (p.a.) 8% 8%
(In Rupees)
31.03.10 31.03.09
The present value of the defined benefit obligation and current service cost were measured using the Projected Unit Credit
Method, with actuarial valuations being carried out at each balance sheet date.
The following table sets out the funded status of the gratuity plan and the amounts recognized in the company’s financial
statements as at March 31, 2010 :
39
5. Related Party Disclosure :
a) Relationship during the year :
i) Key Management Personnel
Sajid Dhanani – Managing Director
Munawar Garbadawala – Director
Capt. Salim Sheikh – Director
ii) Subsidiary Companies
Barbeque-Nation Hospitality Limited
Malwa Hospitality Pvt Ltd
iii) Associate Companies/ Firms/ Relatives
Ahilya Hotels Limited
Aries Hotels Pvt Ltd
Bharat Equity Service Ltd.
Clearwater Capital Partners (Cyprus) Ltd.
Dhanani Securities Ltd.
Kruger Chemical Ltd
M.P. Agro Industries Ltd.
M.Y. Merchant
R. R. Dhanani
R.S. Udar
Sanya Enterprises
Status Travels
Sabiya Amusement Pvt. Ltd
Uniera Laboratories Pvt. Ltd.
Welterman International Ltd.
b) Summary of transaction during the year : (Rs. in Lacs)
A KEY MANAGEMENT PERSONNEL
Remuneration 33.86 33.54
Commission on Profit ---- 1.66
Lease Rent ---- 14.64
B SUBSIDIARY COMPANIES
Investments ---- 1403.39
Loans receivable at the year end 127.72 1920.44
Sale of Brand ---- 249.00
C ASSOCIATE COMPANIES/ FIRMS/RELATIVES
Guest pick up expenses 14.14 19.73
Interest on FCCB 19.14 17.20
Loans receivable at the year end 354.09 504.78
Loans payable at the year end ---- 2.00
Sr.No. Nature of Transactions 2009-10 2008-09
40
6. Income Tax Liability for the year is estimated at Rs.73.73 lacs (Rs. 10.93 lacs towards Minimum Alternate Tax for the year and Rs.
62.80 lacs towards earlier year taxes) (Previous year 93.09 Lacs) under the Income tax Act, 1961. As there has been a virtual certainty
about the Company making profits, timing differences, namely the differences that originate in one accounting period and capable of
reversal in other, after duly identifying the differences between the profit offered to tax and profit as per financial statement, has been
recognized during the year.
The following is the break up of Deferred Assets and Liabilities:
Deferred Assets
- C/Forward losses and Depreciation 514.36 NIL
- Others 59.20 59.74
Total Deferred Assets 573.56 59.74
Deferred Liabilities
- Depreciation Differences 2905.47 2263.01
Total Deferred Liabilities 2905.47 2263.01
Net Deferred Liability 2331.91 2203.28
Net Deferred Tax (Liability)/ Assets (792.62) (748.90)
2009-10 2008-09
7. In the opinion of the Board, the Current Assets, Loans and Advances are approximately of the value stated, if realised, in the ordinary
course of business. Provision for all known liabilities is adequate and not in excess of the amount reasonably necessary.
8. Leave encashment has been determined based on the available leave entitlement at the end calendar year. The incremental amount so
calculated is debited to Employees Emoluments.
9. The turnover of the Company by way of Food and Beverages and sale of shops do not admit of quantitywise details.
10. Debit and Credit balances in party accounts are subject to confirmation and reconciliation.
11. DETAILS OF AUDITORS' REMUNERATION
31.03.10 31.03.09
i) Audit Fees Rs. 2,00,000 Rs.1,25,000
ii) Certification & Other Matters Rs. 50,000 Rs.25,000
12. EARNING IN FOREIGN CURRENCY:31.03.10 31.03.09
i. Sale of rooms and Food and Beverages (deemed export as defined in FTP) Rs. 643.06 Lacs Rs. 416.39 Lacs
13. CIF VALUE OF IMPORT & EXPENDITURES:31.03.10 31.03.09
i. Import of Capital Items Rs 85.36 lacs Rs. 629.67 Lacs
ii. Interest on FCCB Rs. 19.14 lacs Rs. 17.20 lacs
ii. Others Rs. 0.04 lacs Rs. 6.67 lacs
14. DETAILS OF MANAGERIAL REMUNERATION:31.03.10 31.03.09
i. Salaries Rs. 33.67 lacs Rs. 33.36 lacs
ii. Contribution to Provident & Other Funds Rs. 0.18 lacs Rs. 0.18 lacs
iii. Commission on Profit NIL Rs.1.66 lacs
The above payments are within the limits prescribed under the Companies Act, 1956.
(Rs. In lacs)
41
15. EARNING / (LOSS) PER SHARE:
Year ended Year ended
31.03.10 31.03.09
i. Profit/(Loss) after tax but before extraordinary item (Rs. 35.75 lacs) Rs. 446.45 lacs
ii. Profit/(Loss) after Tax and after extraordinary item (Rs. 35.75 lacs) Rs. 518.06 lacs
iii. Cash Profit after adding depreciation, deferred tax, preliminary exps Rs. 959.07 lacs Rs. 1264.74 lacs
iv. Wtd. Average no. of Shares – Basic 12850000 12850000
v. Wtd. Average no. of Shares – Diluted 12850000 12850000
vi. EPS – Basic – before extraordinary item NIL Rs. 3.47
vii. EPS – Basic – after extraordinary item NIL Rs. 4.03
viii. EPS – Diluted – before extraordinary item NIL Rs. 3.47
ix. EPS – Diluted – after extraordinary item NIL Rs. 4.03
x. Cash EPS Rs. 7.46 Rs. 9.84
16. Based on the information available with the Company, there are no dues to micro and small enterprises under the Micro, Small and
Medium Enterprises Development Act.
17. No provision has been made for diminution, if any, in the value of investments held for long term as in the opinion of the
management company would be able to recover at least the cost of the investments.
18. In pursuance of the resolution passed at the EGM held on 03.05.06 the company has issued 0.50% Foreign Currency Convertible
Bonds of US$ 1,00,000 each totaling to US$ 7.50 million. The Bonds are listed at Luxemburg Stock Exchange, London. After the
Balance Sheet date the Bondholders has exercised their option to convert the shares and accordingly 46,68,000 shares has been
allotted on 10.05.2010 in lieu of FCCB.
19. The company had allotted 50 lakhs share warrants @ Rs. 80/- each on 23.01.2008 against which Rs. 4,00,08.387/- were received
as application money. As per the terms of the issue and relevant guidelines the last date for conversion of share warrants to fully
paid-up equity shares was 22.07.2009. Since the investors has not opted to pay the balance amount of subscription, the company
has forfeited the application money. The forfeited amount has been transferred to General Reserve.
20. Figures of previous year have been regrouped, rearranged and recast wherever necessary so as to make them comparable with
those of current year.
42
BALANCE SHEET ABSTRACT AND COMPANY'S GENERAL BUSINESS PROFILE
I. REGISTRATION DETAILS
Registration No. State Code 04
Balance Sheet Date 31/03/2010
II CAPITAL RAISED DURING THE YEAR
(Amount in Rs. Lacs)
Public Issues NIL Right Issue NIL
Bonus Issue NIL Private Placement NIL
III POSITION OF MOBILISATION & DEPLOYMENT OF FUNDS
(Amount in Rs. Lacs)
Total Liabilities 23,602 Total Assets 23,602
Source of Funds
Paid-up Capital 1,285 Reserves & Surplus 4,505
Secured Loans 12,964 Unsecured Loan 4,055
Application of Funds
Net Fixed Assets 19,447 Investment 1,468
Net Current Assets 2,687 Misc. Expenditure NIL
Accumulated Losses NIL
IV PERFORMANCE OF COMPANY
(Amount in Rs. Lacs)
Turnover 8,198 Total Expenditure 8,127
Profit/(loss) Before Tax 71 Profit/(Loss) after tax (36)
Dividend Rate % 0
V GENERIC NAMES OF PRINCIPAL PRODUCTS/SERVICE OF THE COMPANY
Item Code No. (ITC Code) 591001006 Product Description Hotels
Item Code No. (ITC Code) 390001002 Product Description Restaurants
5131
Schedules referred to above form an integral partof the Balance SheetAs per our report of even date attached For SHAH GANDHI & SHAHFirm Regn. No. 126862WChartered Accountants
Nimesh GandhiPartnerM.No. 49134
VADODARA : 31st August 2010
For and on behalf of the Board of Directors
INDORE : 31st August 2010
Sajid R Dhanani Managing Director
Capt. Salim SheikhDirector
M.F. GarbadwalaDirector
Awadhesh GuptaCo. Secretary
43
CASH FLOW STATEMENT FOR THE YEAR ENDED ON 31st MARCH 2010
(Rs. in lacs)
31-Mar-10 31-Mar-09
A. CASH FLOW FROM OPERATING ACTIVITIES
Net Profit before tax and extraordinary 70.77 763.10
Item adjusted for:
Depreciation 943.74 602.53
Interest paid 1,324.42 637.09
Interest Received (32.35) (24.53)
Prior Period & Extra-ordinary items 0.00 (71.61)
Finance lease rental 443.73 462.78
2,679.54 1,606.26
Operating profit before Working Capital 2,750.31 2,369.36
Changes
Adjusted for:
Trade and Other receivables 1,953.72 (1,379.49)
Inventories (154.35) (84.45)
Trade payables (491.70) 1,307.67 773.15 (690.79)
Cash generated from operations 4,057.98 1,678.57
Taxes Paid (131.74) (116.79)
Prior Period & Extra-ordinary items 0.00 71.61
Mat Credit Entitlement 10.93 0.00
Interest paid (1,324.41) (637.09)
Net cash from operating activities 2,612.76 996.30
B. CASH FLOW FROM INVESTING ACTIVITIES
Purchase of Fixed assets (1,439.94) (7,602.20)
Investments (3.08) (797.40)
Interest Received 32.35 (1,410.67) 24.53 (8,375.07)
Net cash used in investing activities 1,202.09 (7,378.77)
44
31-Mar-10 31-Mar-09
CASH FLOW STATEMENT FOR THE YEAR ENDED ON 31st MARCH 2010
(Rs. in lacs)
CASH FLOW FROM FINANCING ACTIVITIES
Unsecured Loans 34.40 162.02
Long Term borrowings (627.16) 7,024.31
Repayment of Fianance lease liablities (443.73) (462.78)
Net cash generated from financing activities (1,036.49) 6,723.55
Net increase in cash and cash equivalents 165.60 (655.22)
Cash and cash equivalents as at the
beginning of the year 174.78 830.00
Cash and cash equivalents as at the
end of the year 340.38 174.78
Note : Figures in bracket indicate disposition of funds and others indicates of generation of funds except the figure of cash and cash
equivalents at the beginning and at the end of the year.
AUDITOR'S CERTIFICATE
We have verified the attached Cash Flow Statement of Sayaji Hotels Ltd for the year ended 31st March, 2010. This statement has been
compiled by the Company from the financial statements for the year ended 31st March 2010 and 31st March 2009. We have found the same
to be in acccordance with the requirements of clause 32 of the listing agreement with stock exchanges.
For and on behalf of the Board of Directors
INDORE : 31st August 2010 Sajid R Dhanani
Managing Director Capt. Salim Sheikh
Director M.F. Garbadwala
Director
Awadhesh GuptaCo. Secretary
VADODARA : 31st August, 2010
For SHAH GANDHI & SHAH
Firm Regn. No. 126862W
Chartered Accountants
Nimesh Gandhi
Partner
M.No. 49134
45
To
THE BOARD OF DIRECTORS
SAYAJI HOTELS LIMITED
VADODARA
We have examined the attached Consolidated Balance Sheet of
SAYAJI HOTELS LIMITED (“the Company”) and its subsidiaries
as at 31st March, 2010, the Consolidated Profit & Loss Account
for the year ended, annexed thereto and also the Consolidated
Cash Flow Statement for the year then ended. The preparation of
these financial statements is 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 prepared, in all
material respects, in accordance with an identified financial
reporting framework and are free of material misstatements. 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. We believe that our
audit provides a reasonable basis for our opinion.
We report that the consolidated financial statements have been
prepared by Sayaji Hotels Limited's management in accordance
with the requirements of Accounting Standards (AS) 21,
Consolidated Financial Statements', and Accounting Standard
(AS) 23, Accounting for Investments in Associates in
Consolidated Financial Statements' issued by the Institute of
Chartered Accountants of India.
Based on our audit and on consideration of other financial
information of the components, and to the best of our
information and according to the explanations given to us, we
are of the opinion that the attached consolidated financial
statements give a true and fair view in conformity with the
accounting principles generally accepted in India:
a. in the case of the Consolidated Balance Sheet, of the
state of affairs of the Company and its subsidiaries
as at 31st March, 2010; and
b. in the case of the Consolidated Profit & Loss
Account, of the consolidated results of the
operations of the Company and its subsidiaries for
the year ended on that date; and
c. in the case of the Consolidated Cash Flow
Statement, of the cash flows of the Company and its
subsidiaries for the year ended on that date.
AUDITORS' REPORT ON CONSOLIDATED FINANCIAL STATEMENTS
For SHAH GANDHI & SHAH
Firm Regn. No. 126862W
Chartered Accountants
Vadodara Nimesh GandhiAugust 31, 2010 Partner
M.No. 49134
46
CONSOLIDATED BALANCE SHEET AS AT 31-03-2010
I. SOURCES OF FUNDS
(1) Shareholders' Funds
(a) Share Capital 1 1,285.00 1,285.00
(b) Reserves & Surplus 2 5,229.20 3,285.98
(c) Share Warrants --- 6,514.20 400.08 4,971.06
(See note 22 of Part B of Sch.16)
(2) Loan Funds
(a) Secured Loans 3 15,157.17 16,211.61
(b) Unsecured Loans 4 4,055.33 19,212.50 4,020.93 20,232.54
(3) Deferred Tax 452.83 426.74
(See note 7 of Part B of Sch.16)
(4) Minority Interest 97.56 ---
TOTAL 26,277.09 25,630.34
II. APPLICATION OF FUNDS
(1) Fixed Assets 6
(a) Gross Block (Original Cost) 27,181.49 23,055.37
(b) Less : Depreciation (4,638.81) (3,319.42)
(c) Net Block 22,542.68 19,735.95
(d) Capital Work in Progress 6 172.20 2,282.27
(e) Expenditure during Construction 6 75.96 766.51
Period pending allocation
(2) Investments 7 64.39 61.31
(3) Current Assets, Loans and Advances 8 5,583.50 5,265.41
Less: Current Liabilities & Provisions 5 (2,161.64) (2,481.11)
Net Current Assets 3,421.86 2,784.30
TOTAL 26,277.09 25,630.34
Significant Accounting Policies 16
Notes on Accounts 16
SchAS AT
31/03/10 AS AT
31/03/09
Schedules referred to above form an integral partof the Balance SheetAs per our report of even date attached For SHAH GANDHI & SHAHFirm Regn. No. 126862WChartered Accountants
Nimesh GandhiPartnerM.No. 49134
VADODARA : 31st August 2010
For and on behalf of the Board of Directors
INDORE : 31st August 2010
Sajid R Dhanani Managing Director
Capt. Salim SheikhDirector
M.F. GarbadwalaDirector
Awadhesh GuptaCo. Secretary
(Rs. In lacs)
47
CONSOLIDATED PROFIT & LOSS ACCOUNT FOR THE YEAR 01.04.2009 TO 31.03.2010
I. INCOME
Rooms, Restaurants, Banquets, Shops 9 15,791.63 11,158.54
and Other Services
Other Income 10 72.52 51.59
TOTAL 15,864.15 11,210.13
II. EXPENDITURE
Food and Beverages materials consumed 11 4,973.07 3,693.11
Operating Expenses 12 1,530.19 1,013.12
Power and Fuel 12 1,435.35 1,107.23
Employees' Emoluments 13 2,246.06 1,752.42
Selling & Administrative Exps. 14 2,554.25 2,004.22
12,738.92 9,570.10
III. OPERATING PROFIT BEFORE INTEREST 3,125.23 1,640.03
Financial Charges 15 1,624.73 930.78
IV. PROFIT/ (LOSS) BEFORE DEPRECIATION 1,500.50 709.25
Depreciation 1,326.49 860.25
Add : Depreciation Written Back 4.36 1.28
V. PROFIT/ (LOSS) BEFORE TAX & PRIOR PERIOD &
EXTRAORDINARY ITEMS 178.37 (149.72)
LESS : PRIOR PERIOD & EXTRAORDINARY ITEMS 132.04 178.75
VI. PROFIT/ (LOSS) BEFORE TAX 46.33 (328.47)
VII. PROVISION FOR TAXATION
CURRENT TAX 73.73 93.09
DEFERRED TAX 26.09 (151.84)
FRINGE BENEFIT TAX (3.26) 14.75
VIII. PROFIT/ (LOSS) AFTER TAX BEFORE MAT CREDIT (50.23) (284.47)
IX. Add : MAT CREDIT ENTITLEMENT
CURRENT YEAR 10.93 ---
X. PROFIT/ (LOSS) AFTER TAX AFTER MAT CREDIT (39.30) (284.47)
XI. BALANCE B/FORWARD FROM LAST YEAR 134.18 418.65
XII. AMOUNT AVAILABLE FOR APPROPRIATION 94.88 134.18
XIII. MINORITY INTEREST (182.45) ---
XIV. AMOUNT CARRIED TO BALANCE SHEET 277.33 134.18
31-Mar-10Sch 31-Mar-09
Schedules referred to above form an integral partof the Balance SheetAs per our report of even date attached For SHAH GANDHI & SHAHFirm Regn. No. 126862WChartered Accountants
Nimesh GandhiPartnerM.No. 49134
VADODARA : 31st August 2010
For and on behalf of the Board of Directors
INDORE : 31st August 2010
Sajid R Dhanani Managing Director
Capt. Salim SheikhDirector
M.F. GarbadwalaDirector
Awadhesh GuptaCo. Secretary
(Rs. In lacs)
48
SCHEDULE - 1 : SHARE CAPITAL
AUTHORISED
20,000,000 Equity Shares of Rs.10/- each 2,000.00 2,000.00
1,000,000 Preferance Shares of Rs.100/- each 1,000.00 1,000.00
TOTAL 3,000.00 3,000.00
ISSUED, SUBSCRIBED & PAID-UP
12850000 (12850000) Equity
Shares of Rs. 10/- each 1,285.00 1,285.00
TOTAL 1,285.00 1,285.00
SCHEDULE - 2 : RESERVES & SURPLUS
(i) Share Premium
Opening at beginning 2,910.40 2,910.40
Addition during the year 1,400.00 ---
Utilised during the year --- ---
Closing at end 4,310.40 2,910.40
(ii) General Reserve
Opening at beginning 241.40 241.40
Addition during the year
(See note 22 of Part B of Sch.16) 400.08 ---
Utilised during the year --- ---
Closing at end 641.48 241.40
TOTAL (i+ii) 4,951.88 3,151.80
(iv) Profit & Loss Account
Opening at beginning 134.17 418.65
Addition during the year 143.15 (284.47)
Closing at end 277.32 134.18
GRAND TOTAL 5,229.20 3,285.98
SCHEDULE - 3 : SECURED LOANS
(Refer Note 1 & 2 of Part B of Schedule 16)
Term Loans 14,400.97 16,090.19
Assets Credit Finance 148.73 121.42
Working Capital Loans 607.47 ---
TOTAL 15,157.17 16,211.61
SCHEDULES FORMING PART OF THE BALANCE SHEET
As at31/03/10
As at31/03/09
(Rs. In lacs)
49
SCHEDULE - 4 : UNSECURED LOANS
Foreign Currency Convertible Bonds
From Foreign Companies 3,501.00 3,501.00
(See Note 17 of Schedule 18)
Fixed Deposits
From Public 510.22 216.32
Other Loans :
From Others 27.73 40.51
From Financial Institution --- 200.00
From Trade Deposit 16.38 44.11 63.10 303.61
TOTAL 4,055.33 4,020.93
SCHEDULE - 5 : CURRENT LIABILITIES &
PROVISIONS
Current Liabilities
Sundry Creditors 1,537.25 1,951.43
Interest Acc.but not due 136.61 1673.86 172.82 2,124.25
(due within 12 months)
Provision -
Taxation 160.32 149.39
Others 327.46 487.78 207.47 356.86
TOTAL 2,161.64 2,481.11
As at31/03/10
As at31/03/09
(Rs. In lacs)
50
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51
SCHEDULE - 7 : INVESTMENT
TRADE INVESTMENTS - AT COST
UnQuoted :
Welterman International Ltd. 26.30 26.30
2,63,000 Equity Shares of Rs. 10
each fully paid up
Bharat Equity Services Ltd. 10.00 10.00
1,00,000 Equity Shares of Rs.10
each fully paid up
Aries Hotels Pvt. Ltd. 25.00 25.00
2,50,000 Equity Shares of Rs.10
each fully paid up
Annoya Sahakari Mandali Co-Op Bank Ltd 0.01 0.01
50 Equity Shares of Rs.10 ech fully
paid up
Axis Bank Limited - Equity Fund 3.08 ---
TOTAL 64.39 61.31
SCHEDULE - 8 : CURRENT ASSETS LOANS
& ADVANCES
CURRENT ASSETS
Inventories
Operating Supplies 456.64 354.50
(Valued at cost as certified by Management)
Food and Beverage 225.72 167.83
(Valued at cost as certified by Management)
Shopping Arcade Stock (at cost) 42.54 724.90 42.54 564.87
Sundry Debtors (Unsecured considered good)
Outstanding Over Six Months 318.18 256.76
Others 498.57 816.75 313.04 569.80
As at31/03/10
As at31/03/09
(Rs. In lacs)
52
Cash and Bank Balances
Cash on hand 38.85 31.20
Bank Balances
With Scheduled Banks
In Current Accounts 275.92 113.16
In Fixed Deposit Account 103.05 417.82 51.75 196.11
LOANS AND ADVANCES (Unsecured,
Considered good unless otherwise
specified)
Advances recoverable in cash or in
kind or for value to be received 3,187.69 3,570.97
Mat Credit Entitlement 148.23 137.29
Advance Tax & TDS Receivable 288.11 3,624.03 226.37 3,934.63
TOTAL 5,583.50 5,265.41
As at31/03/10
As at31/03/09
(Rs. In lacs)
53
SCHEDULE - 09 : ROOMS, RESTAURANTS, BANQUETS, SHOPS
AND OTHER SERVICES
Rooms 2,907.17 1,855.29
Food and Beverages 11,717.43 8,387.27
Other Services 1,167.03 915.98
TOTAL 15,791.63 11,158.54
SCHEDULE - 10 : OTHER INCOME
Interest Earned 42.04 32.16
Miscellaneous Income 30.48 19.43
TOTAL 72.52 51.59
SCHEDULE - 11 : FOOD AND BEVERAGES
Opening Stock 167.83 91.95
Add : Purchases 5,030.96 3,768.99
5,198.79 3,860.94
Less : Closing Stock 225.72 167.83
TOTAL 4,973.07 3,693.11
SCHEDULE - 12 : OPERATING EXPENSES
Stores and Operating Supplies 1,010.62 664.77
Repairs and Maintenance
Building 173.65 121.96
Plant & Machinery 89.54 72.16
Others 125.73 83.89
Laundry Expenses 130.65 70.34
SUB-TOTAL 1,530.19 1,013.12
Power and Fuel 1,435.35 1,107.23
GRAND TOTAL 2,965.54 2,120.35
31-Mar-10 31-Mar-09
(Rs. In lacs)SCHEDULES FORMING PART OF THE PROFIT & LOSS ACCOUNT
54
SCHEDULE - 13 : EMPLOYEES' EMOLUMENTS
Salaries, Wages and Allowances 1,964.86 1,570.35
Contribution to P.F. and other Funds 133.79 95.53
Workmen and Staff Welfare Expenses 96.41 32.62
Workmen and Staff Uniform Expenses 51.00 53.92
TOTAL 2,246.06 1,752.42
SCHEDULE - 14 : SELLING AND ADMINISTRATIVE EXPENSES
Rent/Lease Rent 1,132.52 1,006.22
Rates & Taxes 188.76 152.95
Insurance 23.20 14.76
Legal & Professional 222.44 77.74
Travelling and Conveyance 86.46 104.88
Postage, Telegram and Telephones 82.89 67.72
Advertisement and Publicity 164.91 62.42
Printing and Stationery 119.60 88.58
Directors' Sitting Fees 0.45 0.49
Donation 2.99 0.62
Guest pick up Expenses 169.87 85.60
Other Expenses 243.43 134.51
Water charges 32.09 54.70
Housekeeping Expenses 79.94 55.31
Audit Fees 4.70 3.15
Bad Debts Written Off --- 94.57
TOTAL 2,554.25 2,004.22
SCHEDULE - 15 : FINANCIAL CHARGES
Interest on term Loan 1,361.52 771.76
Interest on Others 76.25 37.94
Bank Charges 186.96 76.36
Restructuring & Processing Fees --- 44.72
TOTAL 1,624.73 930.78
31-Mar-10 31-Mar-09
(Rs. In lacs)
55
SCHEDULES FORMING PART OF THE CONSOLIDATED ACCOUNTS
S C H E D U L E - 1 6 : N O T E S T O A C C O U N T S
A. SIGNIFICANT ACCOUNTING POLICIES
a) The consolidated financial statements comprise the individual financial statements of Sayaji Hotels Limited and it’s subsidiaries
as on 31st March 2010 and for the year ended on that date. The consolidated financial statements have been prepared on the
following basis :
The financial statements of the Company and its subsidiaries have been combined on a line-by-line basis by adding together the
book values of like items of assets, liabilities, income and expenses, after eliminating intra-group balances and intra-group
transactions resulting in unrealized profit or losses as per Accounting Standard – 21 on “Consolidated Financial Statements”
issued by the Institute of Chartered Accountants of India.
b) The financial statements of the subsidiaries, in the consolidation are drawn up to the same reporting date as the Company i.e.
31st March 2010.
c) The financial statements of the following subsidiary companies have been consolidated :
Name of the subsidiary Proportion of Ownership Interest
Current Year Previous Year
i. Barbeque-Nation Hospitality Ltd 69.78 100
ii. Malwa Hospitality Pvt. Ltd. 100.00 100
d) Convention :
i. The financial statements are prepared under the historical cost convention and on the basis of going concern, in
accordance with the generally accepted accounting principles and provisions of the Companies Act 1956.
ii. The Company generally follows mercantile system of accounting and recognizes significant items of income and
expenditure on accrual basis.
iii. Where changes in presentation are made, comparative figures for the previous year are regrouped accordingly.
e) Fixed Assets :
i. Accounted at acquisition cost including directly attributable costs such as freight, insurance and specific installation
charges for bringing the asset to its working condition for use.
ii. Expenditure relating to existing fixed assets is added to the cost of the assets where it increases the performance/life of
the assets as assessed earlier.
iii. Fixed assets are eliminated from financial statements, either on disposal or when retired from active use. Generally, such
retired assets are disposed of soon thereafter.
iv. Pre-operative expenses, including interest on specific loans for the projects incurred till the projects are ready for
Commercial Operation, are capitalised.
v. Expenditure on the new projects are included in Capital Work-in-Progress.
f) Depreciation :
i. Depreciation is charged on fixed assets except on Freehold & leasehold land and buildings (in respect of restaurant chain
business) as per the straight-line method at the rates and in the manner prescribed under Schedule XIV to the Companies
Act, 1956.
ii. Buildings (in respect of the restaurant chain business) constructed on the rented properties are depreciated over the term
of the respective leases.
iii. Assets like vehicles, computers etc. utilized during the construction period are not depreciated till the project is ready.
iv. Computer software and licence are depreciated over a period of three years.
v. Liquor licences purchased for restaurant chain business are depreciated over the period of lease term of the respective
restaurants.
g) Investments :
Long term Investments are stated at cost of acquisition including brokerage, stamp duty, fees, if any.
56
h) Inventories :
i. Inventories are valued at cost or replacement value, whichever is less, after providing for obsolescence and damage.
ii. In the case of raw materials, operating supplies and stores, cost represents purchase price and other costs incurred for
bringing inventories upto their locations and are determined on First-In-First-Out basis.
i) Sales :
Sales is exclusive of Luxury tax, Sales tax, Service Tax and other taxes. Life membership fee of club is treated as income in the
year of its receipts.
j) Accounting for Provisions, Contingent Liabilities and Contingent Assets :
A provision is recognized when the Company has a present obligation as a result of past event and it is probable that an outflow
of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Accounting for
contingencies (gains and losses) arising out of contractual obligations, are made only on the basis of mutual acceptances.
k) Events occurring after the date of Balance Sheet date :
Where material, events occurring after the date of Balance Sheet are considered up to the date of adoption of the accounts.
l) Employee Benefit :
Employee benefit plans comprise both defined benefit and defined contribution plans.
Gratuity liability is a defined benefit obligation and is provided for on the basis of an actuarial valuation on projected unit credit
method made at the end of each financial year. Actuarial gains/ losses are immediately taken to profit and loss account and are
not deferred.
Provident fund is a defined contribution plan. Each eligible employee and the company make contributions at a percentage of the
basic salary specified under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. The Company’s
contributions are charged to the profit and loss account of the year when the contributions to the respective funds are due. The
company has no further obligations under the plan beyond its periodic contributions.
m) Taxation :
i. Provision for current taxation has been made in accordance with the Income Tax Laws applicable to the assessment year.
ii. Deferred Tax is recognized on timing difference being the difference between taxable income and accounting income that
originate in one period and are capable of reversal in one or more subsequent periods. Where there is unabsorbed
depreciation or carry forward losses, deferred tax assets are recognized only if there is virtual certainty of realization such
assets. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income using the tax rates
and tax laws that have been enacted or substantively enacted by the balance sheet date.
iii. In accordance with the Guidance Note on Accounting for credit available in respect of MAT under the Income Tax Act,1961
issued by the ICAI and in view of convincing evidences of the entitlement of credit of the MAT, the current years’ MAT
provision has been recognised and credited to the Profit & Loss Account.
n) Foreign Currency transactions :
Foreign currency transactions are accounted at the rate prevailing on the date of transaction. Gain or loss arising out of
translation/conversion is taken credit for or charged to the Profit & Loss Account.
Exchange difference arising due to repayment or restatement of liabilities incurred for the purpose of acquiring fixed assets are
adjusted in the carrying amount of the respective fixed assets.
o) Assets taken on lease :
i. In respect of finance lease transactions, lease rents paid are charged to the Profit and Loss Account in accordance with the
terms of the lease agreements.
ii. In respect of operating lease transactions, the assets are not capitalized in the books of the Company and lease payments
are charged to the Profit and Loss Account.
p) Borrowing Costs :
Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of
such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other
borrowing costs are charged to revenue.
57
B. NOTES ON ACCOUNTS
1. Notes on Secured Loans of Sayaji Hotels Ltd. :
a) Term Loans of Rs. 20.95 crores from Tourism Finance Corporation of India Ltd. (TFCI) are secured on pari- passu basis by way
of mortgage of land and building at Indore, Pune & Vadodara and hypothecation of the movables, present and future, except
stocks of all kinds including operating supplies, stores, and spares offered to the bankers for securing the working capital loans.
b) Term Loan of Rs. 4.93 crores from HUDCO is secured on pari- passu basis by way of mortgage of land and building at Indore,
Pune & Vadodara and hypothecation of the movables, present and future, except stocks of all kinds including operating
supplies, stores, and spares offered to the Bankers for securing the working capital form.
c) Term Loans of Rs. 7.40 crores from Madhya Pradesh Financial Corporation (MPFC) are secured by way of mortgage of land and
building at Indore and/ hypothecation of the movable, present and future, except stocks of all kinds including operating
supplies, stores and spares offered to the Bankers for securing the working capital finance. Term loan of Rs.7.50 Crores is
secured by way of hypothecation of the movable, present and future, except stocks of all kinds including operating supplies,
stores and spares offered to the Bankers for securing the working capital finance. The equitable mortgage for this loan is yet to
be created.
d) Term Loans of Rs. 54.60 crores from State Bank of India of are secured by way of mortgage of land and building at Indore,
Vadodara & Pune and hypothecation of movables, present and future, except stocks of all kinds including operating supplies
and spares offered to the Bankers for securing the working capital finance.
e) Term Loan of Rs. 2.00 crores from State Bank of India is securitized against the lease rent receivables of Nokia India (P) Ltd. at
Indore.
f) Term Loans of Rs. 29.75 crores from State Bank of Indore are secured by way of mortgage of land and building at Indore,
Vadodara & Pune and hypothecation of movables, present and future, except stocks of all kinds including operating supplies
and spares offered to the Bankers for securing the working capital finance.
g) Term Loan of Rs. 11.50 crores from State Bank of Mysore is secured by way of mortgage of land and building at Indore,
Vadodara & Pune and hypothecation of movables, present and future, except stocks of all kinds including operating supplies
and spares offered to the Bankers for securing the working capital finance.
h) Term Loan of Rs. 6.75 crores from Axis Bank Ltd is secured by way of mortgage of land and building at Indore, Baroda & Pune
and hypothecation of the movable, present and future, except stocks of all kinds including operating supplies, stores and spares
offered to the Bankers for securing the working capital finance.
i) Working Capital Term Loan of Rs. 1.25 crores from Axis Bank Ltd is secured by first charge by way of hypothecation of stocks of
food, beverages, operating supplies stores, spares, book debt of the company and also by way of second charge on the
immovable properties of the company.
j) Working Capital Medium Term Loan of Rs.1.50 crores from Madhya Pradesh Financial Corporation (MPFC) is secured by way of
mortgage of Shops at Sayaji Plaza, Indore.
k) Cash credit facilities of Rs. 6.25 crores State Bank of India is secured by first charge by way of hypothecation of stocks of food,
beverages, operating supplies, stores, spares, book-debts (excluding credit card receivables), bills etc. of the company and also
by way of a second charge on the immovable properties of the company at Indore, Baroda and Pune.
l) Cash credit facilities of Rs. 1.50 crores from Axis Bank Ltd. is secured by first charge by way of hypothecation of stocks of food,
beverages, operating supplies, spares and book debts, bills etc. of the company and also by way of a second charge on the
immovable properties of the company at Indore, Baroda and Pune.
m) Corporate loan of Rs.16.00 crores from Axis Bank Ltd. is secured by first charge by way of hypothecation of stocks of food,
beverages, operating supplies, stores, spares, book-debts, bills etc. of the company and also by way of a Second charge on the
immovable properties of the company at Indore and Baroda.
n) Vehicle loans from ICICI Bank Ltd. are secured by way of hypothecation charge on the specific vehicles.
o) Vehicle loans from HDFC Bank Limited are secured by way of hypothecation charge on specific vehicles.
p) Vehicle loans from Axis Bank Ltd. are secured by way of hypothecation charge on specific vehicles.
q) All term loans except vehicle loans from ICICI Bank Limited,HDFC Bank Limited and Axis Bank Ltd. are personally guaranteed by
some of the director of the company.
r) Installment falling due within next 12 months Rs. 2501.83 Lacs.
58
2. Notes on Secured Loans of Barbeque Nation Hospitality Ltd. :
a) Term loan of Rs. 20.00 crores from State Bank of India is secured on pari-passu basis on the entire fixed assets of the Company
and on pari-passu basis, with the term lenders of Sayaji Hotels Ltd, over the entire fixed assets of Sayaji Hotels Limited by way of
mortgage of land and buildings at Indore, Pune and Vadodara and hypothecation of the movables, present and future, except
stocks of all kinds including operating supplies and spares offered to the bankers for securing the working capital finance.
b) Term loan of Rs. 14.50 crores from State Bank of Mysore is secured on pari-passu basis on the entire fixed assets of the
Company and on pari-passu basis, with the term lenders of Sayaji Hotels Ltd, over the entire fixed assets of Sayaji Hotels
Limited by way of mortgage of land and buildings at Indore, Pune and Vadodara and hypothecation of the movables, present
and future, except stocks of all kinds including operating supplies and spares offered to the bankers for securing the working
capital finance.
c) Term loan of Rs. 15.00 crores from State Bank of Indore is secured on pari-passu basis on the entire fixed assets of the Company
and on pari-passu basis, with the term lenders of Sayaji Hotels Ltd, over the entire fixed assets of Sayaji Hotels Limited by way of
mortgage of land and buildings at Indore, Pune and Vadodara and hypothecation of the movables, present and future, except
stocks of all kinds including operating supplies and spares offered to the bankers for securing the working capital finance.
d) Cash credit facilities of Rs. 2.50 crores from State Bank of India is secured by way of hypothecation of movables, present &
future, including stocks of all kinds, operating supplies and spares and by way of second charge on the entire fixed assets of the
company.
e) The term loans and cash credit facilities are also personally guaranteed by some of the director of the company.
f) The term loans and cash credit facilities are also secured by Corporate Guarantee given by Sayaji Hotels Limited.
g) Installment falling due within next 12 months Rs. 689.88 Lacs.
3. Contingent Liabilities not provided for :
a) Guarantees given on behalf of other companies - Rs. 5621.82 lacs (Previous year Rs. 520 lacs)
b) Disputed statutory liabilities in respect of service tax not provided for : (Rs. In lacs)
31.03.10 31.03.09
i) Tax Demanded 256.78 127.33
ii) Penalty thereon 256.78 127.33
iii) Interest (to be levied in case of confirmation of demand) 148.35 16.34
iv) Total 661.91 271.00
The matters are pending before the hon’ble CESTAT, New Delhi. The Company has got stay order against the tax demand of
Rs.127.33 lacs.
c) Customs duties saved against imports under EPCG scheme - Rs. 783.43 lacs (Previous year Rs. 728.35 lacs)
d) Claims against the company not acknowledged as debt : Rs. 5.06 lacs
e) Disputed liability in respect of :
i. Luxury Tax Rs. 41.13 lacs pertains to tax deposited not considered at the time of assessment and interest charged
thereon.
ii. Vat Tax Rs. 20.73 lacs pertains to Input tax rebate of exemption period being adjusted against presumptive tax of
exemption period.
iii. Entry Tax Rs. 4.64 lacs pertains to entry tax on some items which were considered taxable in the assessment
The above matters are pending before Deputy Commissioner Vat Tax, Indore.
4. During the year under review, company was not engaged in the business of developing and selling of properties, hence the Company
has not provided primary segmental information for these segments as per Accounting Standard – 17 on “Segment Reporting” issued
by the ICAI.
5. The Company adopted the Accounting Standards 15 “Employee Benefits” effective from April 1, 2007.
59
i) Changes in benefit obligations :
Present value of obligation as at the beginning of the year 5315418 4754977
Interest Cost 425233 348179
Current Service Cost 1719038 903621
Actuarial (gain)/ loss on obligations (39756) (325769)
Benefit paid (307011) (365590)
Present value of obligation as at the end of the year 7112922 5315418
ii) Change in plan assets :
Fair value of plan assets as at the beginning of the year 1735128 1553711
Expected return on plan assets 158811 126207
Contributions 500000 413344
Benefits paid Nil (365590)
Actuarial gain/ (loss) on plan assets (301150) 7456
Fair value of plan assets at the end of the year 2092789 1735128
Excess of (obligation over plan assets)/ plan asset over obligation 5020133 (4951290)
(Accrued liability)/ Prepaid benefit (5020133) (4951290)
ii) Net Gratuity and other cost for the year ended 31st March 2009
Current Service cost 1719038 903621
Interest on defined benefit obligation 425233 348179
Expected return on plan assets (158811) (109673)
Net actuarial gain recognized in the year 261393 (330469)
Net gratuity and other cost 2246853 811658
Actual return on plan asset (142339) 133663
iv) Category of Assets as at 31 March 2009
Insurer Managed Funds 2092789 1735128
Others Nil Nil
Total 2092789 1735128
v) Assumptions used
Discount rate (p.a.) 8.00% 8.00%
Salary escalation rate (p.a.) 5.00% 5.00%
Expected rate of return on plan assets (p.a.) 8.00% 8.00%
(In Rupees)
31.03.10 31.03.09
Defined contribution plans : During the year the Company has recognized the following amounts in the Profit and Loss account,
which are included in “Contribution to PF and other funds” in Schedule 13 :
31.03.10 31.03.09
i. Contribution to Provident Fund Rs. 133.79 lacs Rs. 65.88 lacs
Defined Benefit Plans : The Company makes annual contributions to the Employee’s Group Gratuity scheme of the SBI Life Insurance
Co. Ltd., a funded defined benefit plan for the qualifying employees. The scheme provides for lump sum payment to vested employees
at retirement, death while in employment or on termination of employment as per the terms of the scheme. Vesting occurs upon
completion of five years of service.
The present value of the defined benefit obligation and current service cost were measured using the Projected Unit Credit Method,
with actuarial valuations being carried out at each balance sheet date.
The following table sets out the funded status of the gratuity plan and the amounts recognized in the company’s financial statements
as at March 31st, 2009.
60
6. Related Party Disclosure :
a) Relationship during the year :
i) Key Management Personnel
Sajid Dhanani – Managing Director
Munawar Garbadawala – Director
Capt. Salim Sheikh – Director
Prosenjeet Roy Choudhary – Director
ii) Associate Companies/ Firms/ Relatives
Ahilya Hotels Limited
Aries Hotels Pvt Ltd
Bharat Equity Service Ltd.
Clearwater Capital Partners (Cyprus) Ltd.
Dhanani Securities Ltd.
Kruger Chemical Ltd
M.P. Agro Industries Ltd.
M.Y. Merchant
R. R. Dhanani
R.S. Udar
Mansoor Memon
Saba Memon
Sanya Enterprises
Status Travels
Sabiya Amusement Pvt. Ltd
Uniera Laboratories Pvt. Ltd.
Welterman International Ltd.
b) Summary of transaction during the year : (Rs. in Lacs)
A KEY MANAGEMENT PERSONNEL
Remuneration 57.57 62.84
Commission on Profit Nil 1.66
Lease Rent Nil 14.64
Professional fees Nil 10.00
B ASSOCIATE COMPANIES/ FIRMS/RELATIVES
Guest pick up expenses 14.14 19.73
Lease rent paid Nil 104.34
Interest on FCCB 19.14 17.20
Loans receivable at the year end 354.09 504.78
Lease deposit paid Nil 90.00
Loans payable at the year end Nil 2.00
Professional Fees paid 18.00 Nil
Sr.No. Nature of Transactions 2009-10 2008-09
61
7. Income Tax Liability for the year is estimated at Rs.73.73 lacs (Rs. 10.93 lacs towards Minimum Alternate Tax for the year and Rs.
62.80 lacs towards earlier year taxes) (Previous year Rs.93.08 Lacs) under the Income tax Act, 1961 As there has been a virtual
certainty about the Company making profits, timing differences, namely the differences that originate in one accounting period and
capable of reversal in other, after duly identifying the differences between the profit offered to tax and profit as per financial statement,
has been recognized during the year.
The following is the break up of Deferred Assets and Liabilities:
Deferred Assets
- Unabsorbed Depreciation 1729.10 1012.80
- Others 97.45 96.61
Total Deferred Assets 1826.55 1109.41
Deferred Liabilities
- Depreciation Differences 3158.71 2366.37
Total Deferred Liabilities 3158.71 2366.37
Net Deferred Liability 1332.16 1256.96
Net Deferred Tax (Liability)/ Assets (452.83) (426.74)
2009-10 2008-09
8. In the opinion of the Board, the Current Assets, Loans and Advances are approximately of the value stated, if realised, in the ordinary
course of business. Provision for all known liabilities is adequate and not in excess of the amount reasonably necessary.
9. The turnover of the Company by way of Food and Beverages and sale of shops do not admit of quantitywise details.
10. Debit and Credit balances in party accounts are subject to confirmation and reconciliation.
11. DETAILS OF AUDITORS' REMUNERATION
31.03.10 31.03.09
i) Audit Fees Rs. 325000 Rs. 200000
ii) Certification & Other Matters Rs.50000 Rs.25000
12. EARNING IN FOREIGN CURRENCY:
31.03.10 31.03.09
i. Sale of rooms and Food and Beverages (deemed export as defined in FTP) Rs. 973.51 lacs Rs. 472.25 Lacs
13. CIF VALUE OF IMPORT & EXPENDITURES:
31.03.10 31.03.09
i. Import of Capital Items Rs. 113.23 lacs Rs.631.94 lacs
ii. Interest on FCCB Rs. 19.14 lacs Rs. 17.20 lacs
iii. Others Rs. 0.04 lacs Rs. 6.67 lacs
14. DETAILS OF MANAGERIAL REMUNERATION:
31.03.10 31.03.09
i. Salaries Rs. 57.29 lacs Rs. 72.49 Lacs
ii. Contribution to Provident & Other Funds Rs. 0.27 lacs Rs. 0.35 Lacs
iii. Commission on Profit NIL Rs. 1.66 Lacs
The above payments are within the limits prescribed under the Companies Act, 1956.
(Rs. In lacs)
62
15. Leave encashment has been determined based on the available leave entitlement at the end calendar year. The incremental amount
so calculated is debited to Employees Emoluments.
16. Extraordinary items of Rs. 132.04 lacs shown in Profit and Loss account includes the loss on account of write-off of fixed assets
expenditure incurred towards setting up of the Amritsar restaurant in Barbeque-Nation Hospitality Ltd. which did not start its
commercial operations.
17. In pursuance of the Special resolution passed in the Extraordinary General Meeting of Barbeque-Nation Hospitality Ltd. held on
28.03.2009 the company has allotted 28,00,000 equity shares at Rs. 60/- each to Blue Deebaj Chemicals LLC, Dubai on
07.07.2009.
18. EARNING / (LOSS) PER SHARE:
Period ended Period ended
31.03.10 31.03.09
i. Profit after tax but before extraordinary item Rs. 92.74 lacs Rs.(105.71) lacs
ii. Profit after tax and after extraordinary item (Rs. 39.30 lacs) Rs(284.46). lacs
iii. Cash Profit after adding depreciation, deferred tax, preliminary exps Rs 1126.48 lacs Rs.422.66 lacs
and after minority interest
iv. Wtd. Average no. of Shares – Basic 12850000 12850000
v. Wtd. Average no. of Shares – Diluted 12850000 12850000
vi. EPS – Basic – before extraordinary item Rs.0.72 Nil
vii. EPS – Basic – after extraordinary item Nil Nil
viii. EPS – Diluted – before extraordinary item Rs. 0.72 Nil
ix. EPS – Diluted – after extraordinary item Nil Nil
x. Cash EPS Rs. 8.77 Rs.3.29
19. Based on the information available with the Company, there are no dues to micro and small enterprises under the Micro, Small and
Medium Enterprises Development Act.
20. No provision has been made for diminution, if any, in the value of investments held for long term as in the opinion of the
management company would be able to recover at least the cost of the investments.
21. In pursuance of the resolution passed at the EGM held on 03.05.06 the company has issued 0.50% Foreign Currency Convertible
Bonds of US$ 1,00,000 each totaling to US$ 7.50 million. The Bonds are listed at Luxemburg Stock Exchange, London. After the
Balance Sheet date the Bondholders has exercised their option to convert the shares and accordingly 46,68,000 shares has been
allotted on 10.05.2010 in lieu of FCCB.
22. Sayaji Hotels Ltd. had allotted 50 lakhs share warrants @ Rs. 80/- each on 23.01.2008 against which Rs. 4,00,08.387/- were
received as application money. As per the terms of the issue and relevant guidelines the last date for conversion of share warrants
to fully paid-up equity shares was 22.07.2009. Since the investors has not opted to pay the balance amount of subscription, the
company has forfeited the application money. The forfeited amount has been transferred to General Reserve.
23. Figures of previous year have been regrouped, rearranged and recast wherever necessary so as to make them comparable with
those of current year.
63
(Rs. in lacs)
31-Mar-10 31-Mar-09
A. CASH FLOW FROM OPERATING ACTIVITIES
Net Profit before tax and extraordinary 46.33 (328.48)
Item adjusted for:
Depreciation 1,322.13 858.98
Interest paid 1,660.95 840.67
Interest Received (42.04) (32.16)
Prior Period & Extra-ordinary items 132.04 178.75
Finance lease rental 1,132.52 1,006.22
4,205.60 2,852.46
Operating profit before Working Capital 4,251.93 2,523.98
Changes
Adjusted for:
Trade and Other receivables 136.33 (410.65)
Inventories (160.03) (193.63)
Trade payables (330.40) (354.10) 913.30 309.02
Cash generated from operations 3,897.83 2,833.00
Taxes Paid (132.22) (132.05)
Prior Period & Extra-ordinary items (132.04) (178.75)
Mat Credit Entitlement 10.93 0.00
Interest paid (1,660.94) (840.67)
Net cash from operating activities 1,983.56 1,681.53
B. CASH FLOW FROM INVESTING ACTIVITIES
Purchase of Fixed assets (1,328.25) (9,829.25)
Investments (3.08) 0.00
Interest Received 42.04 (1,289.29) 32.15 (9,797.10)
Net cash used in investing activities 694.27 (8,115.57)
CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED ON 31st MARCH 2010
64
31-Mar-10 31-Mar-09
CASH FLOW STATEMENT FOR THE YEAR ENDED ON 31st MARCH 2010
(Rs. in lacs)
CASH FLOW FROM FINANCING ACTIVITIES
Share Capital and Share Premium 1,680.00
Unsecured Loans 34.40 161.68
Long Term borrowings (1,054.44) 8,257.98
Repayment of Finance lease liabilities (1,132.52) (1,006.22)
Net cash generated from financing activities (472.56) 7,413.44
Net increase in cash and cash equivalents 221.71 (702.13)
Cash and cash equivalents as at the
beginning of the year 196.11 898.24
Cash and cash equivalents as at the
end of the year 417.81 196.11
Note : Figures in bracket indicate disposition of funds and others indicates of generation of funds except the figure of cash and cash
equivalents at the beginning and at the end of the year.
AUDITOR'S CERTIFICATE
We have verified the attached Cash Flow Statement of Sayaji Hotels Ltd & its subsidiaries for the year ended 31st March, 2010. This
statement has been compiled by the Company from the financial statements for the year ended 31st March 2010 and 31st March 2009. We
have found the same to be in accordance with the requirements of clause 32 of the listing agreement with stock exchanges.
For and on behalf of the Board of Directors
INDORE : 31st August, 2010 Sajid R Dhanani
Managing Director Capt. Salim Sheikh
Director M.F. Garbadwala
Director
Awadhesh GuptaCo. Secretary
VADODARA : 31st , 2010August
For SHAH GANDHI & SHAH
Firm Regn. No. 126862W
Chartered Accountants
Nimesh Gandhi
Partner
M.No. 49134
65
FINANCIAL STATEMENTS
The Audited financial statements of the Company prepared in
accordance with Accounting Standards -21 prescribed by the
Institute of Chartered Accountants of India form part of the Annual
Report.
STATE OF COMPANY AFFAIRS
As the members are aware, the restaurant business in the country
has been growing rapidly and is poised to grow fast in future. Your
management strongly believes that your company can be a part of
this growth story and therefore has undertaken ambitious
expansion plans. During the year under review, your company
operated twelve restaurants located at Janakpuri (New Delhi),
Thyagaraja (T Nagar Chennai), Chandigrah, Gomati Nagar
(Lucknow), Tonk Road (Jaipur), Drive in Road (Ahemdabad), J.P.
Nagar (Bangalore), Alkapuri (Baroda), Thane (Mumbai), Nagar
Road (Pune), Bidhan Nagar (Kolkata) and Jalandhar.
In the coming years, the company has plans to open more
restaurants in different part of India.
ISSUE AND ALLOTMENT OF EQUITY SHARES
During the year under review, your company has allotted 28,00,000
Equity Share on Preferential Basis to M/s Blue Deebaj Chemical LLC
outsider of the Company.
OPERATIONS OF FIVE RESTAURANT BUSINESS
These five units (i)Mumbai, (ii)Bangalore-Indra Nagar,(iii)
Bangalore- Koramangala, (iv) Hyderabad and (v) Gurgaon which
are in holding company have been successfully operated by the
Company during the financial year 2009-10.
OUTLOOK
Your Company strongly believes that Indian economy would
continue to grow at a firm pace notwithstanding some temporary
setbacks. With the economic growth, per capita income and
disposal income in the hands of the consumer would also rise. This
is expected to higher spending on eating out and thereby restaurant
business is also likely to get a boost. Restaurant chains like ours are
likely to benefit fun this trend. With this optimism and confidence
the company is embarking on its future growth plans.
DIVIDEND
In view of the loss and various expansions in hand, your directors
do not recommend dividend for the financial year 2009-2010.
DIRECTORS
Sri Sajid R. Dhanani, Director of the company, will retire by rotation
in ensuing Annual General Meeting and is eligible for re-
appointment as per provision of the Companies Act, 1956, read
with the Articles of Association of the Company.
FINANCIAL RESULTS
Particulars Financial Year 2009-10 Financial Year 2008-09
Income 844.05 300.21
Less: Operating Expenses 762.37 336.69
Profit/(Loss) before Financial Charges and Depreciation 81.68 (36.48)
Less: Financial Charges 33.07 21.19
Profit/(Loss) before Depreciation 48.610 (57.67)
Less: Depreciation 37.84 25.64
Less: Prior Period & Extraordinary Items 13.20 0.13
Profit/(Loss) before Tax (2.43) (83.44)
Less: Provision for taxation (2.14) (28.58)
Operating profit/(Loss) after Tax (0.29) (54.87)
Add: Balance brought forward from previous year (60.08) (5.21)
Balance carried to Balance Sheet (60.37) (60.08)
(Figures in Rs. million)
DIRECTORS' REPORT
Yours Directors have pleasure in presenting the Fourth Annual Report of the company together with the audited Balance Sheet as on March
31, 2010 and Profit and Loss account for the year ended on that date.
66
PARTICULARS OF EMPLOYEES
The provisions of Section 217 (2A) of the Companies Act, 1956, of
the Companies Act, 1956 read with the provisions of the
Companies (Particulars of Employees) Rules, 1975, are not
attracted in case of any employee of the company.
ACKNOWLEDGMENT
The Directors place on record their sincere gratitude to the
employees of the company for their hard work and continued
support to the company.
Your Directors also wish to acknowledge the continued support
and cooperation received from the participating financial
institutions, banks, various central and state government agencies,
Shareholders, suppliers and the valued customers of our
Company.
For and on behalf of the Board of Directors
Place : Indore
Date: 23rd August 2010 Chairman
AUDITORS
M/s Shah Gandhi & Shah, Chartered Accountants, Auditors of the
Company, who hold office until the conclusion of the ensuing
Annual General Meeting and are eligible for re-appointment. Your
company has received a letter from them to the effect that their
appointment, if made, would be within the prescribed limits under
section 224 (1B) of the Companies Act 1956.
AUDITORS’ REPORT
The report of the Board of Directors of the Company and notes to
the accounts are self-explanatory and do not require further
explanation.
FIXED DEPOSITS
The Company has not invited any deposits from public during the
period under review attracting the provision of Section 58A of the
Companies Act, 1956 and rules framed there under.
DIRECTORS’ RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 217 (2AA) of the Companies
Act, 1956, the Board confirms:
(i) That in the preparation of the annual accounts for the
financial year ended March 31, 2010 the applicable
accounting standards have been followed along with proper
explanations relating to material departures;
(ii) That the directors have selected such accounting policies
and applied them consistently and made judgments and
estimates that are reasonable and prudent so as to give a true
and fair view of the state of the affairs of the Company at the
end of the financial year and of the profit or loss of the
company for that period;
(iii) That the directors have taken proper and sufficient care for
the maintenance of adequate accounting records in
accordance with the provisions of this Act for safeguarding
the assets of the company and for preventing and detecting
fraud and other irregularities; and
(iv) That the directors had prepared the annual accounts on a
going concern basis.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION ETC.
Particulars of Conservation of Energy, Technology Absorption etc.,
required to be given pursuant to Section 217(1)(e) of the
Companies Act, 1956, read with the Rules made there under are not
applicable to the Company.
The Company has not absorbed any new technology during the
year under review. The inflow and Outflow of Foreign Exchange
during the year under review is as under:
Foreign Exchange Earnings : Rs.33.045 million
Foreign Exchange Outgo : Rs.02.787 million
67
To
THE BOARD OF DIRECTORS
BARBEQUE-NATION HOSPITALITY LIMITED
INDORE
We have examined the attached Consolidated Balance Sheet of
BARBEQUE-NATION HOSPITALITY LIMITED (“the Company”)
and its subsidiaries as at 31st March, 2010, the Consolidated
Profit & Loss Account for the year ended, annexed thereto and
also the Consolidated Cash Flow Statement for the year the
ended. The preparation of these financial statements is 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 prepared, in all
material respects, in accordance with an identified financial
reporting framework and are free of material misstatements. 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. We believe that our
audit provides a reasonable basis for our opinion.
We report that the consolidated financial statements have been
prepared by Barbeque-Nation Hospitality Limited's
management in accordance with the requirements of
Accounting Standards (AS) 21, Consolidated Financial
Statements', and Accounting Standard (AS) 23, Accounting for
Investments in Associates in Consolidated Financial
Statements' issued by the Institute of Chartered Accountants of
India.
Based on our audit and on consideration of other financial
information of the components, and to the best of our
information and according to the explanations given to us, we
are of the opinion that the attached consolidated financial
statements give a true and fair view in conformity with the
accounting principles generally accepted in India:
a. in the case of the Consolidated Balance Sheet, of the
state of affairs of the Company and its subsidiaries
as at 31st March, 2010; and
b. in the case of the Consolidated Profit & Loss
Account, of the consolidated results of the
operations of the Company and its subsidiaries for
the year ended on that date; and
c. in the case of the Consolidated Cash Flow
Statement, of the cash flows of the Company and its
subsidiaries for the year ended on that date.
AUDITOR'S REPORT ON CONSOLIDATED FINANCIAL STATEMENTS
For SHAH GANDHI & SHAH
Firm Regn. No. 126862W
Chartered Accountants
Vadodara Nimesh Gandhi Partner
M.No. 4913423rd August 2010
68
BARBEQUE-NATION HOSPITALITY LIMITED (CONSOLIDATED)
I. SOURCES OF FUNDS
(1) Shareholders' Funds
(a) Share Capital 1 926.50 646.50
(b) Reserves & Surplus 2 1,607.50 2,534.00 207.50 854.00
(2) Loan Funds
(a) Secured Loans 3 2,193.04 2,620.32
(b) Unsecured Loans 4 99.22 2,292.26 1,920.44 4,540.76
TOTAL 4,826.26 5,394.76
II. APPLICATION OF FUNDS
(1) Fixed Assets 6
(a) Gross Block (Original Cost) 4,012.56 3,766.58
(b) Less : Depreciation (643.00) (264.62)
(c) Net Block 3,369.56 3,501.96
(d) Capital Work in Progress 6 172.20 372.91
(e) Expenditure during Construction 6 --- 156.96
Period pending allocation
(2) Current Assets, Loans and Advances 7 1,211.76 1,149.94
Less: Current Liabilities & Provisions 5 (867.98) (706.68)
Net Current Assets 343.78 443.26
(3) Deferred Tax
337.00 318.85
(4) Profit & Loss Account 2 603.72 600.82
TOTAL 4,826.26 5,394.76
Significant Accounting Policies 15
Notes on Accounts 15
(See note 5 of Part B of Sch.15)
SchAS AT
31/03/10AS AT
31/03/09
Schedules referred to above form an integral partof the Balance SheetAs per our report of even date attached For SHAH GANDHI & SHAHFirm Regn. No. 126862WChartered Accountants
Nimesh GandhiPartnerM.No. 49134
VADODARA : 23rd August 2010
For and on behalf of the Board of Directors
INDORE : 23rd August 2010
Sajid R Dhanani Director
Prosenjeet Roy ChoudharyDirector
Surendran R.Manager
(Rs. In lacs)BALANCE SHEET AS AT 31-03-2010
69
PROFIT & LOSS ACCOUNT FOR THE YEAR 01.04.2009 TO 31.03.2010
BARBEQUE-NATION HOSPITALITY LIMITED (CONSOLIDATED)
I. INCOME
Restaurants and Other Services 8 8,424.04 2,992.50
Other Income 9 16.54 9.67
TOTAL 8,440.58 3,002.17
II. EXPENDITURE
Food and Beverages materials consumed 10 3,284.38 1,365.05
Operating Expenses 11 465.65 211.94
Power and Fuel 11 719.59 362.27
Employees' Emoluments 12 1,096.04 576.91
Selling & Administrative Exps. 13 2,058.05 850.74
7,623.71 3,366.91
III. Operating Profit before Interest 816.87 (364.74)
Financial Charges 14 330.76 211.98
IV. PROFIT/ (LOSS) BEFORE DEPRECIATION 486.11 (576.72)
Depreciation 379.07 256.45
Add : Depreciation Written Back 0.68 ---
V PROFIT/ (LOSS) BEFORE TAX & PRIOR PERIOD &
EXTRAORDINARY ITEMS 107.72 (833.17)
LESS : PRIOR PERIOD & EXTRAORDINARY ITEMS 132.03 1.36
VI. PROFIT/ (LOSS) BEFORE TAX (24.31) (834.53)
VII. PROVISION FOR TAXATION
FRINGE BENEFIT TAX (3.26) 6.92
DEFERRED TAX (18.15) (292.74)
VIII. PROFIT/ (LOSS) AFTER TAX (2.90) (548.71)
IX. BALANCE B/FORWARD FROM LAST YEAR (600.82) (52.11)
X. AMOUNT AVAILABLE FOR APPROPRIATION (603.72) (600.82)
XI. AMOUNT CARRIED TO BALANCE SHEET (603.72) (600.82)
31-Mar-10Sch 31-Mar-09
Schedules referred to above form an integral partof the Balance SheetAs per our report of even date attached For SHAH GANDHI & SHAHFirm Regn. No. 126862WChartered Accountants
Nimesh GandhiPartnerM.No. 49134
VADODARA : 23rd August 2010
For and on behalf of the Board of Directors
INDORE : 23rd August 2010
Sajid R Dhanani Director
Prosenjeet Roy ChoudharyDirector
Surendran R.Manager
(Rs. In lacs)
70
SCHEDULE - 1 : SHARE CAPITAL
AUTHORISED
20,000,000 Equity Shares of Rs.10/- each 2,000.00 2,000.00
TOTAL 2,000.00 2,000.00
ISSUED, SUBSCRIBED & PAID-UP
9265004 (6465004) Equity 926.50 646.50
Shares of Rs. 10/- each
TOTAL 926.50 646.50
SCHEDULE - 2 : RESERVES & SURPLUS
(i) Share Premium
Opening at beginning 207.50 ---
Addition during the year 1,400.00 207.50
Utilised during the year --- ---
Closing at end 1,607.50 207.50
(ii) Profit & Loss Account
Opening at beginning (600.82) (52.11)
Addition during the year (2.90) (548.71)
Closing at end (603.72) (600.82)
GRAND TOTAL 1,003.78 (393.32)
SCHEDULE - 3 : SECURED LOANS
Term Loans 2,054.98 2,620.32
Working Capital Loans 138.06 ---
TOTAL 2,193.04 2,620.32
SCHEDULE - 4 : UNSECURED LOANS
Other Loans :
From Holding Company 99.22 1,920.44
TOTAL 99.22 1,920.44
SCHEDULE - 5 : CURRENT LIABILITIES &
PROVISIONS
Current Liabilities
Sundry Creditors 623.50 579.02
Interest Acc.but not due 17.03 640.53 22.73 601.75
(due within 12 months)
Provisions Others 227.45 227.45 104.93 104.93
TOTAL 867.98 706.68
(See note 1 of Part B of Sch. 15)
SCHEDULES FORMING PART OF THE BALANCE SHEET
As at31/03/10
As at31/03/09
(Rs. In lacs)
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72
SCHEDULE - 7 : CURRENT ASSETS LOANS
& ADVANCES
CURRENT ASSETS
Inventories
Operating Supplies 62.26 62.45
(Valued at cost as certified by Management)
Food and Beverage 92.07 154.33 86.20 148.65
(Valued at cost as certified by Management)
Sundry Debtors (Unsecured considered good)
Outstanding Over Six Months 29.38 1.27
Others 54.28 83.66 34.49 35.76
CASH AND BANK BALANCES
Cash on hand 13.32 6.43
Bank Balances
With Scheduled Banks
In Current Accounts 63.97 77.29 14.61 21.04
LOANS AND ADVANCES (Unsecured,
Considered good unless otherwise
specified)
Advances recoverable in cash or in
kind or for value to be received 885.59 937.34
Advance Tax & TDS Receivable 10.89 896.48 7.15 944.49
TOTAL 1,211.76 1,149.94
As at31/03/10
As at31/03/09
(Rs. In lacs)
73
SCHEDULE - 08 : RESTAURANTS AND OTHER SERVICES
Food and Beverages 8,322.20 2,935.83
Other Services 101.84 56.67
TOTAL 8,424.04 2,992.50
SCHEDULE - 09 : OTHER INCOME
Interest Earned 9.69 7.63
Miscellaneous Income 6.85 2.04
TOTAL 16.54 9.67
SCHEDULE - 10 : FOOD AND BEVERAGES
MATERIALS CONSUMED
Opening Stock 86.20 11.18
Add : Purchases 3,290.25 1,440.07
3,376.45 1,451.25
Less : Closing Stock 92.07 86.20
TOTAL 3,284.38 1,365.05
SCHEDULE - 11 : OPERATING EXPENSES
Stores and Operating Supplies 237.55 119.38
Repairs and Maintenance
Building 96.80 37.12
Plant & Machinery 48.23 24.02
Others 54.83 9.64
Laundry Expenses 28.24 21.78
SUB-TOTAL 465.65 211.94
Power and Fuel 719.59 362.27
GRAND TOTAL 1,185.24 574.21
31-Mar-10 31-Mar-09
(Rs. In lacs)SCHEDULES FORMING PART OF THE PROFIT & LOSS ACCOUNT
74
SCHEDULE - 12 : EMPLOYEES' EMOLUMENTS
Salaries, Wages and Allowances 960.70 510.25
Contribution to P.F. and other Funds 56.92 31.05
Workmen and Staff Welfare Expenses 47.51 15.02
Workmen and Staff Uniform Expenses 30.91 20.59
TOTAL 1,096.04 576.91
SCHEDULE - 13 : SELLING AND ADMINISTRATIVE EXPENSES
Rent/Lease Rent 688.80 543.44
Operating Fees on Revenue 765.54 ---
Rates & Taxes 108.53 44.55
Insurance 4.84 2.61
Legal & Professional 169.81 24.97
Travelling and Conveyance 50.48 61.14
Postage, Telegram and Telephones 43.70 25.76
Advertisement and Publicity 68.96 32.84
Printing and Stationery 68.43 39.32
Donation 0.28 0.08
Other Expenses 70.36 40.09
Water charges 13.81 7.09
Housekeeping Expenses 3.11 28.10
Audit Fees 1.40 0.75
TOTAL 2,058.05 850.74
SCHEDULE - 14 : FINANCIAL CHARGES
Interest on term Loan 252.50 190.03
Interest on Others 0.73 0.66
Bank Charges 77.53 21.29
TOTAL 330.76 211.98
31-Mar-10 31-Mar-09
(Rs. In lacs)
75
BARBEQUE NATION HOSPITALITY LIMITED
S C H E D U L E - 1 5 : N O T E S T O A C C O U N T S
A. SIGNIFICANT ACCOUNTING POLICIES
a) The financial statements comprise the individual financial statements of Barbeque-Nation Hospitality Limited and it’s
subsidiaries as on 31st March 2010 and for the year ended on that date. The financial statements have been prepared on the
following basis :
The financial statements of the Company and its subsidiaries have been combined on a line-by-line basis by adding together the
book values of like items of assets, liabilities, income and expenses, after eliminating intra-group balances and intra-group
transactions resulting in unrealized profit or losses as per Accounting Standard – 21 on “Consolidated Financial Statements”
issued by the Institute of Chartered Accountants of India.
b) The financial statements of the subsidiaries, in the consolidation are drawn up to the same reporting date as the Company i.e.
31st March 2010.
c) The financial statements of the following subsidiary companies have been consolidated :
Name of the subsidiary Proportion of Ownership Interest
Current Year Previous Year
i. Kshipra Restaurants Pvt. Ltd 100.00 Nil
ii. Favorite Restaurants Pvt. Ltd. 100.00 Nil
d) Convention :
i. The financial statements have been prepared under the historical cost convention and on the basis of going concern, in
accordance with the generally accepted accounting principles and provisions of the Companies Act 1956.
ii. The Company generally follows mercantile system of accounting and recognizes significant items of income and
expenditure on accrual basis.
iii. Where changes in presentation are made, comparative figures for the previous year are regrouped accordingly.
e) Fixed Assets :
i. Accounted at acquisition cost including directly attributable costs such as freight, insurance and specific installation
charges for bringing the asset to its working condition for use.
ii. Expenditure relating to existing fixed assets is added to the cost of the assets where it increases the performance/life of
the assets as assessed earlier.
iii. Fixed assets are eliminated from financial statements, either on disposal or when retired from active use. Generally, such
retired assets are disposed of soon thereafter.
iv. Pre-operative expenses, including interest on specific loans for the projects incurred till the projects are ready for
Commercial Operation, are capitalised.
v. Expenditure on the new project and advances given for capital expenditure are included in Capital Work-in-Progress.
f) Depreciation :
i. Depreciation is charged on fixed assets, except on buildings, as per the straight-line method at the rates and in the manner
prescribed under Schedule XIV to the Companies Act, 1956.
ii. Buildings constructed on the rented properties are depreciated over the term of the respective leases.
iii. Assets like vehicle, computers etc. utilized during the construction period are not depreciated till the project is ready.
iv. Liquor licences with perpetual term purchased for restaurant chain business are depreciated over the period of lease term
of the respective restaurants.
76
g) Inventories :
i. Inventories are valued at cost or replacement value, whichever is less, after providing for obsolescence and damage.
ii. In the case of raw materials, operating supplies and stores, cost represents purchase price and other costs incurred for
bringing inventories upto their locations and are determined on First-In-First-Out basis.
h) Sales :
Sales is exclusive of Sales tax, Service Tax and other taxes.
i) Accounting for Provisions, Contingent Liabilities and Contingent Assets :
A provision is recognized when the Company has a present obligation as a result of past event and it is probable that an outflow
of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Accounting for
contingencies (gains and losses) arising out of contractual obligations, are made only on the basis of mutual acceptances.
j) Events occurring after the date of Balance Sheet date :
Where material, events occurring after the date of Balance Sheet are considered up to the date of adoption of the accounts.
k) Employee Benefit :
Employee benefit plans comprise both defined benefit and defined contribution plans.
Gratuity liability is a defined benefit obligation and is provided for on the basis of an actuarial valuation on projected unit credit
method made at the end of each financial year. Actuarial gains/ losses are immediately taken to profit and loss account and are
not deferred.
Provident fund is a defined contribution plan. Each eligible employee and the company make contributions at a percentage of the
basic salary specified under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. The Company’s
contributions are charged to the profit and loss account of the year when the contributions to the respective funds are due. The
company has no further obligations under the plan beyond its periodic contributions.
l) Taxation :
i. Due to absence of taxable income during the year the provision for current taxation has not been made in accordance with
the Income Tax Laws applicable to the assessment year.
ii. Deferred Tax is recognized on timing difference being the difference between taxable income and accounting income that
originate in one period and are capable of reversal in one or more subsequent periods. Where there is unabsorbed
depreciation or carry forward losses, deferred tax assets are recognized only if there is virtual certainty of realization such
assets. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income using the tax rates
and tax laws that have been enacted or substantively enacted by the balance sheet date.
iii. In accordance with the Guidance Note on Accounting for credit available in respect of MAT under the Income Tax Act,1961
issued by the ICAI and in view of convincing evidences of the entitlement of credit of the MAT, the current year MAT
provision has been recognised and credited to the Profit & Loss Account.
m) Foreign Currency transactions :
Foreign currency transactions are accounted at the rate prevailing on the date of transaction. Gain or loss arising out of
translation/conversion is taken credit for or charged to the Profit & Loss Account.
Exchange difference arising due to repayment or restatement of liabilities incurred for the purpose of acquiring fixed assets are
adjusted in the carrying amount of the respective fixed assets.
n) Assets taken on lease :
In respect of operating lease transactions, the assets are not capitalized in the books of the Company and lease payments are
charged to the Profit and Loss Account.
77
o) Segment Reporting :
During the year the company was engaged in the restaurant business only.
p) Borrowing Costs :
Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of
such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other
borrowing costs are charged to revenue.
B. NOTES ON ACCOUNTS
1. Secured Loans :
a) Term loan of Rs. 20.00 crores from State Bank of India is secured on pari-passu basis on the entire fixed assets of the Company
and on pari-passu basis, with the term lenders of Sayaji Hotels Ltd, over the entire fixed assets of Sayaji Hotels Limited by way of
mortgage of land and buildings at Indore, Pune and Vadodara and hypothecation of the movables, present and future, except
stocks of all kinds including operating supplies and spares offered to the bankers for securing the working capital finance.
b) Term loan of Rs. 14.50 crores from State Bank of Mysore is secured on pari-passu basis on the entire fixed assets of the
Company and on pari-passu basis, with the term lenders of Sayaji Hotels Ltd, over the entire fixed assets of Sayaji Hotels Limited
by way of mortgage of land and buildings at Indore, Pune and Vadodara and hypothecation of the movables, present and future,
except stocks of all kinds including operating supplies and spares offered to the bankers for securing the working capital
finance.
c) Term loan of Rs. 15.00 crores from State Bank of Indore is secured on pari-passu basis on the entire fixed assets of the Company
and on pari-passu basis, with the term lenders of Sayaji Hotels Ltd, over the entire fixed assets of Sayaji Hotels Limited by way of
mortgage of land and buildings at Indore, Pune and Vadodara and hypothecation of the movables, present and future, except
stocks of all kinds including operating supplies and spares offered to the bankers for securing the working capital finance.
d) Cash credit facilities of Rs. 2.50 crores from State Bank of India is secured by way of hypothecation of movables, present &
future, including stocks of all kinds, operating supplies and spares and by way of second charge on the entire fixed assets of the
company.
e) The term loans and cash credit facilities are also personally guaranteed by some of the director of the company.
f) The term loans and cash credit facilities are also secured by Corporate Guarantee given by Sayaji Hotels Limited.
g) Installment falling due within next 12 months Rs. 689.88 Lacs.
2. Contingent Liabilities not provided for :
a) Customs duties saved against imports under EPCG scheme - Rs. 33.05 lacs (Previous year Rs. 33.05 Lacs)
3. The Company adopted the Accounting Standards 15 “Employee Benefits” effective from April 1, 2007.
Defined contribution plans : During the year the Company has recognized the following amounts in the Profit and Loss account,
which are included in “Contribution to PF and other funds” in Schedule 12 :
31.03.10 31.03.09
i. Contribution to Provident Fund Rs. 56.92 lacs Rs. 23.32 lacs
Defined Benefit Plans : The Company makes annual contributions to the Employee’s Group Gratuity scheme of the SBI Life Insurance
Co. Ltd., a funded defined benefit plan for the qualifying employees. The scheme provides for lump sum payment to vested employees
at retirement, death while in employment or on termination of employment as per the terms of the scheme. Vesting occurs upon
completion of five years of service.
The present value of the defined benefit obligation and current service cost were measured using the Projected Unit Credit Method,
with actuarial valuations being carried out at each balance sheet date.
78
i) Changes in benefit obligations :
Present value of obligation as at the beginning of the year 585004 442815
Interest Cost 46800 3206
Current Service Cost 799828 138983
Actuarial (gain)/ loss on obligations (525505) Nil
Benefit paid Nil Nil
Present value of obligation as at the end of the year 906127 585004
ii) Change in plan assets :
Fair value of plan assets as at the beginning of the year 432634 Nil
Expected return on plan assets 54611 16534
Contributions 500000 413344
Benefits paid Nil Nil
Actuarial gain/ (loss) on plan assets 6518 2756
Fair value of plan assets at the end of the year 993763 432634
Excess of (obligation over plan assets)/ plan asset over obligation 87636 (152370)
(Accrued liability)/ Prepaid benefit 87636 (152370)
iii) Net Gratuity and other cost for the year ended 31st March 2010
Current Service cost 799828 138983
Interest on defined benefit obligation 46800 3206
Expected return on plan assets (54611) Nil
Net actuarial gain recognized in the year (532024) Nil
Net gratuity and other cost 259994 142189
Actual return on plan asset 61129 19290
iv) Category of Assets as at 31 March 2010
Insurer Managed Funds 993763 432634
Others Nil Nil
Total 993763 432634
v) Assumptions used
Discount rate (p.a.) 8.00% 8.00%
Salary escalation rate (p.a.) 5% 5%
Expected rate of return on plan assets (p.a.) 8.00% 8.00%
(In Rupees)
31.03.10 31.03.09
The following table sets out the funded status of the gratuity plan and the amounts recognized in the company’s financial statements
as at
79
b) Summary of transaction during the year : (Rs. in Lacs)
A KEY MANAGEMENT PERSONNEL
Remuneration 23.71 29.30
Professional Fees NIL 10.00
B HOLDING COMPANY
Issue of Equity shares NIL 249.00
Loans payable at the year end 99.22 1920.44
C. SUBSIDIARY COMPANIES
Investments 2.00 NIL
D ASSOCIATE COMPANIES/ FIRMS/RELATIVES
Professional Fees 18.00 NIL
Sr.No. Nature of Transactions 2009-10 2008-09
5. Income Tax Liability for the year is estimated at NIL as Company has does not have taxable income under the Income tax Act, 1961.
The company is also not liable to pay minimum alternate tax. As there is a virtual certainty about the Company making profits, timing
differences, namely the differences that originate in one accounting period and capable of reversal in other, after duly identifying the
differences between the profit offered to tax and profit as per financial statement, has been recognized during the year.
The following is the break up of Deferred Tax Assets and Liabilities:
Deferred Assets
- C/Forward losses and Unabsorbed Depreciation 1206.35 1012.80
- Others 38.26 28.62
Total Deferred Assets 1244.61 1041.42
Deferred Liabilities
- Depreciation Differences 253.24 103.36
Total Deferred Liabilities 253.24 103.36
Net Deferred Assets/(Liability) 991.37 938.06
Net Deferred Tax Assets/(Liability) 337.00 318.85
2009-10 2008-09
(Rs. In lacs)
4. Related Party Disclosure :
a) Relationship during the year :
i) Key Management Personnel
Sajid Dhanani – Director
Prosenjeet Roy Choudhary – Director
Subhash Pandit – Director
ii) Holding Company
Sayaji Hotels Limited
iii) Associate Companies/ Firms/ Relatives
Sana Hospitality Pvt. Ltd.
Mansoor Memon
Saba Memon
80
6. In the opinion of the Board, the Current Assets, Loans and Advances are approximately of the value stated, if realised, in the ordinary
course of business. Provision for all known liabilities is adequate and not in excess of the amount reasonably necessary.
7. The turnover of the Company by way of Food and Beverages do not admit of quantitywise details.
8. Leave encashment has been determined based on the available leave entitlement at the end of each calendar year. The incremental
amount so calculated each year is debited to Employees Emoluments.
9. Extraordinary items of Rs. 132.04 lacs shown in Profit and Loss account includes the loss on account of write-off of fixed assets
expenditure incurred towards setting up of the Amritsar restaurant of the company which did not start its commercial operations.
10. In pursuance of the Special resolution passed in the Extraordinary General Meeting held on 28.03.2009 the company has allotted
28,00,000 equity shares at Rs. 60/- each to Blue Deebaj Chemicals LLC, Dubai on 07.07.2009.
11. Debit and Credit balances in party accounts are subject to confirmation and reconciliation.
12. DETAILS OF AUDITORS' REMUNERATION
31.03.10 31.03.09
i) Audit Fees Rs. 1,25,000 Rs. 75,000
13. EARNING IN FOREIGN CURRENCY:
31.03.10 31.03.09
i. Sale of Food and Beverages (deemed export as defined in FTP) Rs. 330.45 lacs Rs. 55.85 lacs
14. CIF VALUE OF IMPORT & EXPENDITURES:
31.03.10 31.03.09
i. Import of Capital Items Rs. 27.87 lacs Rs. 2.27 Lacs
15. DETAILS OF MANAGERIAL REMUNERATION:
31.03.10 31.03.09
i. Salaries Rs. 23.62 lacs Rs. 39.13 lacs
ii. Contribution to Provident & Other Funds Rs. 0.09 lacs Rs. 0.17 lacs
The above payments are within the limits prescribed under the Companies Act, 1956.
16. EARNING / (LOSS) PER SHARE:
31.03.10 31.03.09
i. Profit/(Loss) after tax but before extraordinary item Rs. 129.14 lacs (Rs. 547.35 lacs)
ii. Profit/(Loss) after Tax and after extraordinary item (Rs 2.90 lacs) (Rs. 548.71 lacs)
iii. Cash Profit after adding depreciation, deferred tax, preliminary exps Rs. 357.33 lacs (Rs. 585.00 lacs)
iv. Wtd. Average no. of Shares – Basic 8520894 6465004
v. Wtd. Average no. of Shares – Diluted 8520894 6465004
vi. EPS – Basic – before extraordinary item Rs. 1.52 NIL
vii. EPS – Basic – after extraordinary item NIL NIL
viii. EPS – Diluted – before extraordinary item Rs. 1.52 NIL
ix. EPS – Diluted – after extraordinary item NIL NIL
x. Cash EPS Rs. 4.19 NIL
17. Based on the information available with the Company, there are no dues to micro and small enterprises under the Micro, Small and
Medium Enterprises Development Act.
18. Figures of previous year have been regrouped, rearranged and recast wherever necessary so as to make them comparable with those
of current year.
81
(Rs. in lacs)
31-Mar-10 31-Mar-09
A. CASH FLOW FROM OPERATING ACTIVITIES
Net Profit before tax and extraordinary (24.31) (834.53)
Item adjusted for:
Depreciation 378.38 256.45
Interest paid 336.46 203.58
Interest Received (9.68) (7.63)
Prior Period & Extra-ordinary items 132.03 1.36
Finance lease rental 688.80 543.44
1,525.99 997.20
Operating profit before Working Capital 1,501.68 162.67
Changes
Adjusted for:
Trade and Other receivables 3.85 (359.31)
Inventories (5.69) (109.18)
Trade payables 161.30 159.46 139.05 (329.44)
Cash generated from operations 1,661.14 (166.77)
Taxes Paid (0.48) (14.06)
Prior Period & Extra-ordinary items (132.04) (1.36)
Mat Credit Entitlement 0.00 0.00
Interest paid (336.46) (203.58)
Net cash from operating activities 1,192.16 (385.77)
B. CASH FLOW FROM INVESTING ACTIVITIES
Purchase of Fixed assets 111.71 (2,454.99)
Interest Received 9.68 121.39 7.63 (2,447.36)
Net cash used in investing activities 1,313.55 (2,833.13)
CASH FLOW STATEMENT FOR THE YEAR ENDED ON 31st MARCH 2010
BARBEQUE-NATION HOSPITALITY LIMITED (CONSOLIDATED)
82
31-Mar-10 31-Mar-09
CASH FLOW STATEMENT FOR THE YEAR ENDED ON 31st MARCH 2010
(Rs. in lacs)
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from Issue of Shares/ Appln. Money 1,680.00 249.00
Unsecured Loans (1,821.22) 1,847.72
Long Term borrowings (427.28) 1,233.66
Repayment of Finance lease liabilities (688.80) (543.44)
Net cash generated from financing activities (1,257.30) 2,786.94
Net increase in cash and cash equivalents 56.24 (46.19)
Cash and cash equivalents as at the
beginning of the year 21.04 67.23
Cash and cash equivalents as at the
end of the year 77.29 21.04
Note : Figures in bracket indicate disposition of funds and others indicates of generation of funds except the figure of cash and cash
equivalents at the beginning and at the end of the year.
AUDITOR'S CERTIFICATE
We have verified the attached Cash Flow Statement of Barbeque-Nation Hospitality Ltd. for the year ended 31st March, 2010. This
statement has been compiled by the Company from the financial statements for the year ended 31st March 2010 and 31st March 2009. We
have found the same to be in accordance with the requirements of clause 32 of the listing agreement with stock exchanges.
For and on behalf of the Board of Directors
INDORE : 23rd August 2010
VADODARA : 23rd August 2010
For SHAH GANDHI & SHAH
Firm Regn. No. 126862W
Chartered Accountants
Nimesh Gandhi
Partner
M.No. 49134
Sajid R Dhanani Director
Prosenjeet Roy ChoudharyDirector
Surendran R.Manager
83
FINANCIAL STATEMENTS
The Audited financial statements of the Company prepared in
accordance with Accounting Standards -21 prescribed by the
Institute of Chartered Accountants of India form part of the Annual
Report.
STATE OF COMPANY AFFAIRS
The company has not commenced any Business during the year.
DIVIDEND
In view of the loss, your Board has not recommended any dividend
for the financial year ended March 31, 2010.
DIRECTORS
In terms of the provision of the Companies Act, 1956 Smt. Suchitra
Dhanani director of the company retires by rotation in ensuing
Annual General Meeting and is eligible for re-appointment as
director.
AUDITORS
M/s Shah Gandhi & Shah, Chartered Accountants, Auditors of the
company, hold office until the conclusion of the ensuing Annual
General Meeting and being eligible, offer themselves for re-
appointment. The company has received a letter from them to the
effect that their appointment, if made, would be within the
prescribed limits under section 224 (1B) of the Companies Act
1956.The Board recommends their re-appointment.
AUDITORS’ REPORT
The report of the Board of Directors of the Company and notes to
the accounts are self-explanatory and do not require further
explanation.
FIXED DEPOSITS
The Company has not invited any deposits from public during the
period under review attracting the provision of Section 58A of the
Companies Act, 1956 and rules framed there under.
DIRECTORS’ RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 217 (2AA) of the Companies
Act, 1956, the Board confirms that:
(i) That in the preparation of the annual accounts for the
financial year ended March 31, 2010 the applicable
accounting standards have been followed along with proper
explanations relating to material departures;
(ii) That the directors have selected such accounting policies
and applied them consistently and made judgments and
estimates that are reasonable and prudent so as to give a true
and fair view of the state of the affairs of the Company at the
end of the financial year and of the profit or loss of the
company for that period;
DIRECTORS' REPORT
Yours Directors have pleasure in presenting Third Annual Report of the company together with audited Balance Sheet as on March 31, 2010
and Profit and Loss account for the year ended on that date.
Income - -
Less: Operating Expenses (0.012) 0.80
Profit/(Loss) before Depreciation (0.012) (0.80)
Less: Prior Period & Extraordinary Items - -
Profit/(Loss) before Tax (0.012) (0.80)
Less: Provision for taxation (0.052) (0.32)
Profit/(Loss) after Tax (0.064) (0.48)
Add: Balance brought forward from previous year (0.49) (0.01)
Balance carried to Balance Sheet (0.55) (0.49)
84
(iii) That the directors have taken proper and sufficient care for
the maintenance of adequate accounting records in
accordance with the provisions of this Act for safeguarding
the assets of the company and for preventing and detecting
fraud and other irregularities; and
(iv) That the directors had prepared the annual accounts on a
going concern basis.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION ETC.
Particulars of Conservation of Energy, Technology Absorption etc.,
required to be given pursuant to Section 217(1)(e) of the
Companies Act, 1956, read with the Rules made there under are not
applicable to the company.
The Company has not absorbed any new technology during the
year under review. The inflow and Outflow of Foreign Exchange
during the year under review is as under:
Foreign Exchange Earnings : Nil
Foreign Exchange Outgo : Nil
PARTICULARS OF EMPLOYEES
The provisions of Section 217 (2A) of the Companies Act, 1956, of
the Companies Act, 1956 read with the provisions of the
Companies (Particulars of Employees) Rules, 1975, are not
attracted in case of any employee of the company.
ACKNOWLEDGMENT
The Directors place on record their sincere gratitude to the
employees of the Company for their hard work and continued
support to the Company.
For and on behalf of the Board of Directors
Place : Indore
ChairmanDate : 16th August, 2010
85
To
THE MEMBERS OF
MALWA HOSPITALITY PVT.LTD.
We have audited the attached Balance sheet of MALWA
HOSPITALITY PRIVATE LIMITED as at 31 ST MARCH, 2010.
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 and
Report that:
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.
1. As required by the Manufacturing and Other Companies
(Auditors' Report) Order, 1988, issued by the Company
Law Board in terms of Section 227 (4A) of the Companies
Act, 1956, and in terms of information and explanations
given to us and on the basis of such checks, as we
considered appropriate, we enclosed in an Annexure
hereto a Statement on the matters specified in paragraph
4 and 5 of the said Order, to the extent applicable to the
Company.
2. Further to our comments in the Annexure referred to in
Paragraph 1 above, we report that -
(a) We have obtained all the information and
explanations, which, to the best of our knowledge
and belief, were necessary for the purposes of the
Audit.
(b) In our opinion, proper books of accounts as
required by law have been kept at the office of the
company, so far as appear from our examination of
books and accounts are in agreement therewith.
(c) In our opinion these accounts have been prepared in
compliance with the applicable Accounting
Standards referred to in sub-section (3C) of Section
211 of 'The Companies Act, 1956 of India.
(d) The Balance Sheet dealt with by this report are in
agreement with books of account.
(e) On the basis of written representations received
from the directors, as on 31st March 2010 and taken
on record by the Board of Directors, we report that
none of the directors is disqualified as on 31st
March 2010 from being appointed as a director in
terms of clause (g) of sub-section (1) of section 274
of the Companies Act, 1956.
3. In our opinion and to the best of our information and
according to the explanations given to us, the balance
sheet together with the notes thereon, give in the
prescribed manner and the information required by the
Act and also give respectively, a true and fair view of the
state of the Company's affairs as at 31st March, 2010.
AUDITORS' REPORT
For SHAH GANDHI & SHAH
Firm Regn. No. 126862W
Chartered Accountants
Vadodara Nimesh Gandhi Partner
M.No. 4913416th August, 2010
86
ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR
AUDITORS' REPORT OF EVEN DATE ON THE ACCOUNTS FOR
THE YEAR ENDED 31ST MARCH, 2010 OF MALWA
HOSPITALITY PRIVATE LIMITED.
1) The Company has no fixed assets. Therefore, record
keeping and physical verification of the same does not
applicable.
2) Since the Company’s project is under implementation and
has no production related inventory, pertaining to
physical verification of finished goods, stores, spares
parts and raw materials, maintenance of records of the
said order are not applicable.
3) (a) Company has taken loans from 1 companies, firms
or other parties covered in the register maintained
under section 301 of the Act., where in the balance
payable as at the year end is Rs. 28.50 lacs. The
maximum amounts involved in the transactions
during the year are Rs. NIL.
(b) The loans taken are interest free and other terms
and conditions of loans taken by the company are
not prima facie prejudicial to the interest of the
Company.
(c) The loans taken by the company are repayable on
demand.
4) The Company has not granted unsecured advances to
companies or other parties covered in the Register
maintained under Section 301 of the Companies Act,
1956
5) In our opinion and to the best of our information and
according to the explanations given to us, there are
adequate internal control procedures commensurate with
the size of the company and nature of its business. There
are no major weaknesses in internal control procedure.
6) As per the information and explanation given to us, there
are no transactions that need to be entered into the
register maintained under section 301 of the Companies
Act, 1956.
7) As per the information and explanation given to us, the
Company has not accepted any deposits from the Public
and hence the matter of compliance with the directives
issued by the Reserve Bank of India and rules framed
thereunder does not arise.
8) The Company has system of internal audit, which is in our
opinion, is commensurate with size of the business.
9) Central Government has not prescribed maintenance of
the cost records under section 209(1)(d) of the
Companies Act, 1956 for the company.
10) According to the records and as per the information and
explanation given to us, the company is generally regular
in depositing with appropriate authorities undisputed
amount of Provident Fund, Investor Education Fund,
Employee State Insurance , Income Tax, Excise Duty,
Custom Duty and other statutory dues applicable to it and
no undisputed amounts payable were outstanding on
31st March 2010 for the period more that six months from
the date they became payable. There is no disputed
liability.
11) The company has not completed five years after its
registration, comments on cash loss incurred in the
current financial year or immediately preceding financial
year is not given.
12) Based on our audit procedure and as per the information
and explanation given to us, we report that no fraud on or
by the company has been noticed or reported during the
course of our audit.
13) The Company is not a Sick Industrial Company within the
meaning of Clause (o) of the Sub-section (1) of Section 3
of Sick Industrial Companies (Special Provisions) Act,
1985.
For SHAH GANDHI & SHAH
Firm Regn. No. 126862W
Chartered Accountants
Vadodara Nimesh Gandhi Partner
M.No. 4913416th August, 2010
87
MALWA HOSPITALITY PRIVATE LIMITED
I. SOURCES OF FUNDS
(1) Shareholders' Funds
(a) Share Capital 1 54,940,000 54,940,000
(2) Loan Funds
(a) Unsecured Loans 2 2,850,000 2,850,000
TOTAL 57,790,000 57,790,000
II APPLICATION OF FUNDS
(1) Fixed Assets (Gross Block)
(a) Expenditure incurred during
Pre Operation period pending
allocation 5,105,400 5,105,400 5,105,400 5,105,400
(2) Deferred Tax Assets 278,336 330,433
(See note 4 of Sch. 6)
(3) Current Assets, Loans and Advances 3
(a) Cash and Bank Balances 14,932 28,382
(b) Loans & Advances 51,840,000 51,840,000
51,854,932 51,868,382
Less : Current Liabilities & Provisions
(a) Sundry Creditors & Provisions 4 8,253 8,828
Net Current Assets 51,846,679 51,859,554
(4) Profit and Loss Account 559,584 494,613
TOTAL 57,790,000 57,790,000
SIGNIFICANT ACCOUNTING POLICIES 5
NOTES FORMING PART OF THE ACCOUNTS 6
(Rupees)
SchAS AT
31/03/10AS AT
31/03/09
BALANCE SHEET AS AT 31st MARCH, 2010
Sajid R Dhanani Director
Suchitra DhananiDirector
Schedules referred to above form an integral partof the Balance SheetAs per our report of even date attached For SHAH GANDHI & SHAHFirm Regn. No. 126862WChartered Accountants
Nimesh GandhiPartnerM.No. 49134
VADODARA : 16th August 2010
For and on behalf of the Board of Directors
INDORE : 16th August 2010
88
PROFIT AND LOSS ACCOUNT FOR THE PERIOD ENDED 31.03.2010
MALWA HOSPITALITY PRIVATE LIMITED
I. INCOME NIL NIL
TOTAL --- ---
II. EXPENDITURE
LEGAL EXPENSES 1,500 771,600
MISCELLANEOUS EXPENSES --- 5,536
PROFESSIONAL FEES --- 25,000
AUDIT FEES 5,000 3,000
BANK CHARGES 6,375
12,875 805,136
III. PROFIT/ (LOSS) BEFORE DEPRECIATION (12,875) (805,136)
IV PROFIT/ (LOSS) BEFORE & PRIOR PERIOD & (12,875) (805,136)
EXTRAORDINARY ITEMS
V PROFIT / (LOSS) BEFORE TAXES (12,875) (805,136)
Less : DEFERRED TAX (52,097) 323,666
VI. PROFIT /(LOSS) AFTER TAX (64,971) (481,470)
VII. BALANCE B/FORWARD FROM LAST YEAR (494,613) (13,143)
VIII. AMOUNT AVAILABLE FOR APPROPRIATION --- ---
IX. LOSS CARRIED TO BALANCE SHEET (559,584) (494,613)
TOTAL31-Mar-10
SchTOTAL
31-Mar-09
(Rupees)
Sajid R Dhanani Director
Suchitra DhananiDirector
Schedules referred to above form an integral partof the Balance SheetAs per our report of even date attached For SHAH GANDHI & SHAHFirm Regn. No. 126862WChartered Accountants
Nimesh GandhiPartnerM.No. 49134
VADODARA : 16th August 2010
For and on behalf of the Board of Directors
INDORE : 16th August 2010
89
SCHEDULE-1 : SHARE CAPITAL
AUTHORISED
100,00,000 Equity Shares of Rs.10/- each. 100,000,000 100,000,000
ISSUED, SUBSCRIBED & PAID-UP
5,494,000 Equity Shares of Rs.10/- each 54,940,000 54,940,000
TOTAL 54,940,000 54,940,000
SCHEDULE-2 : UNSECURED LOANS
Inter Corporate Loans :
From Associate Companies 2,850,000 2,850,000
TOTAL 2,850,000 2,850,000
SCHEDULE-3 : CURRENT ASSETS, LOANS
& ADVANCES
Current Assets
Cash and Bank Balance
Cash on hand 10,000 Nil
Bank Balances In Current Account 4,932 14,932 28,382 28,382
Loans & Advances
(Unsecured, Good unless otherwise specified)
Deposits 51,840,000 51,840,000
TOTAL 51,840,000 51,840,000
SCHEDULE-4 : CURRENT LIABILITIES & PROVISIONS
Sundry Creditors 3,253 3,253
Provision 5,000 5,575
TOTAL 8,253 8,828
SCHEDULES FORMING PART OF THE BALANCE SHEET
As at31/03/10
As at31/03/09
(Rupees)
90
31-Mar-10 31-Mar-09
A. CASH FLOW FROM OPERATING ACTIVITIES
Net Profit before Tax & Extraordinary (12,875) (805,136)
Operating Profit before Working Capital Changes:
Trade Payables (575) (11,082)
Deposits --- (575) --- (11,082)
Cash generated from Operating Activities (13,450) (816,218)
B. CASH FLOW FROM INVESTMENT ACTIVITIES:
Increase in Expenditure incurred during
Pre Operation period pending allocation --- (2,105,400)
Cash generated from Investment Activities --- (2,105,400)
B. CASH FLOW FROM FINANCING ACTIVITIES:
Unsecured Loan --- 2,850,000.00
Cash generated from Financing Activities --- 2,850,000
Net Increase in Cash & Cash Equivalent (13,450) (71,618)
Cash & Cash Equivalent as at the 28,382 100,000.00
beginning of the year 28,382 100,000
Cash & Cash Equivalent as at the
end of the year 14,932 28,382.00
CASH FLOW STATEMENT FOR THE YEAR ENDED ON 31st MARCH 2010
MALWA HOSPITALITY PRIVATE LIMITED
Note : Figures in Bracket indicate disposition of funds and others indicates of generation of funds except the figure of Cash & Cash
Equivalents at the beginning and at the end of the year.
AUDITOR'S CERTIFICATE
We have verified the attached Cash Flow Statement of Malwa Hospitality Pvt.Ltd. For the year ended 31st March 2010. The Statement
has been complied by the company from the financial statements for the year ended 31st March 2010.
INDORE : 16th August 2010
For and on behalf of the Board of Directors
Sajid R Dhanani Director
Suchitra DhananiDirector
(Rupees)
VADODARA : 16th August 2010
For SHAH GANDHI & SHAH
Firm Regn. No. 126862W
Chartered Accountants
Nimesh Gandhi
Partner
M.No. 49134
91
SCHEDULE - 5
SIGNIFICANT ACCOUNTING POLICIES
A. SYSTEM OF ACCOUNTING :
The financial statements have been prepared under the historical cost convention and on the basis of going concern, in accordance
with the generally accepted accounting principles and provisions of the Companies Act 1956. The Company follows Mercantile
System of Accounting.
B. TAXES ON INCOME :
Due to absence of taxable income during the year the provision for current taxation has not been made in accordance with the Income
Tax Laws applicable to the assessment year
Deferred Tax is recognized on timing difference being the difference between taxable income and accounting income that originate in
one period and are capable of reversal in one or more subsequent periods. Where there is unabsorbed depreciation or carry forward
losses, deferred tax assets are recognized only if there is virtual certainty of realization such assets. The effect on deferred tax assets
and liabilities of a change in tax rates is recognized in income using the tax rates and tax laws that have been enacted or substantively
enacted by the balance sheet date
C. FIXED ASSETS:
Pre-operative expenses incurred, till the projects are ready for Commercial Operation, are capitalized.
SCHEDULE - 6
NOTES FORMING PART OF THE ACCOUNTS
(1) The Company has not yet commenced any business operations.
(2) Auditors Remuneration
Current Year (Rs) Previous Year (Rs)
As Audit Fees 5,000 3,000
(3) In the opinion of the Board, the Current Assets, Loans and Advances are approximately of the value stated, if realized, in the ordinary
course of business. Provision for all known liabilities is adequate and not in excess of the amount reasonably necessary.
(4) The Company has not been liable to pay any Income tax for the year as there is no income during the year. Company has not been also
liable to pay any Minimum Alternate Tax under the said Act, as book profit is negative. Following is the break up of Deferred Tax Assets
& Liabilities:
MALWA HOSPITALITY PRIVATE LIMITED : 31.03.2010
Deferred Assets :
Carry/Forward Losses 837921 825046
Deferred Liabilities : Nil Nil
Net Deferred Assets/ (Liabilities) 837921 825046
Net Deferred Tax Assets/ (Liabilities) 278336 330433
2009-10 2008-09
92
BALANCE SHEET ABSTRACT AND COMPANY/S GENERAL BUSINESS PROFILE
I. REGISTRATION DETAILS
Registration No. State Code
Balance Sheet Date 31/03/2010
II CAPITAL RAISED DURING THE YEAR
(Amount in Rs.)
Public Issues NIL Right Issue NIL
Bonus Issue NIL Private Placement NIL
III POSITION OF MOBILISATION & DEPLOYMENT OF FUNDS
(Amount in Rs.)
Total Liabilities 57,798,253 Total Assets 57,798,253
Source of Funds
Paid-up Capital 54940000 Reserves & Surplus NIL
Secured Loans NIL Unsecured Loan 2,850,000
Application of Funds
Net Fixed Assets 5105400 Investment NIL
Net Current Assets 51846679 Misc. Expenditure NIL
Accumulated Losses 559,584
IV PERFORMANCE OF COMPANY
(Amount in Rs.)
Turnover NIL Total Expenditure (12,875)
Profit/(loss) Before Tax (12,875) Profit/(Loss) after tax (64,971)
Dividend Rate % NIL
V GENERIC NAMES OF PRINCIPAL PRODUCTS/SERVICE OF THE COMPANY
Item Code No. (ITC Code) 591001006 Product Description Hotels
Item Code No. (ITC Code) 390001002 Product Description Restaurants
U55209MP2008PTC020502 04
Sajid R Dhanani Director
Suchitra DhananiDirector
Schedules referred to above form an integral partof the Balance SheetAs per our report of even date attached For SHAH GANDHI & SHAHFirm Regn. No. 126862WChartered Accountants
Nimesh GandhiPartnerM.No. 49134
VADODARA : 16th August 2010
For and on behalf of the Board of Directors
INDORE : 16th August 2010
93
STATEMENT PURSUANT SECTION 212 OF THE COMPANIES ACT, 1956RELATING TO SUBSIDIARY COMPANIES (SHL)
1 Name of the subsidiaries : Barbeque-Nation Hospitality Malwa Hospitality Private
Limited Limited
2 Financial Year of the
subsidiary ended on : 31st March 2010 31st March 2010
3 Number of shares of the subsidiary
company held by the Holding
Company on the above date
a) Number and Face Value : 6,464,998 Equity Shares 5,494,000 Equity Shares
of Rs. 10 each fully paid-up of Rs. 10 each fully paid-up
b) Extent of holding : 69.78% 100%
4 The net aggregate amount of
Profit/(Losses) of the Subsidiary
Company for the above financial
year, so far as they concern the
Members of the Company
(I) dealt within the accounts
of the Company :
(a) For the financial year ended (60,372,000) (559,584)
31st March, 2010
(b) For the previous financial (60,082,000) (494,613)
year since these became
subsidiaries of the Company
(ii) not dealt with in the accounts
of the Company:
(a) For the financial year ended
31st March, 2010
(b) For the previous financial
year since these became
subsidiaries of the Company
Place : IndoreDate : 31st August 2010
For and on behalf of the Board of Directors
Sajid R Dhanani Managing Director
Capt. Salim SheikhDirector
M.F. GarbadwalaDirector
Awadhesh GuptaCo. Secretary
94
STATEMENT PURSUANT SECTION 212 OF THE COMPANIES ACT, 1956RELATING TO SUBSIDIARY COMPANIES (BNHL)
1 Name of the : Kshipra Restaurants Favorite Restaurant
Private Limited
2 Financial Year of the
subsidiary ended on : 31st March 2010 31st March 2010
3 Number of shares of the subsidiary
company held by the Holding
Company on the above date
a) Number and Face Value : 10,000 Equity Shares 10,000 Equity Shares
of Rs. 10 each fully paid-up of Rs. 10 each fully paid-up
b) Extent of holding : 100% 100%
4 The net aggregate amount of
Profit/(Losses) of the Subsidiary
Company for the above financial
year, so far as they concern the
Members of the Company
(I) dealt within the accounts
of the Company :
(a) For the financial year ended (0) (0)
31st March, 2010
(b) For the previous financial (0) (0)
year since these became
subsidiaries of the Company
(ii) not dealt with in the accounts
of the Company:
(a) For the financial year ended
31st March, 2010
(b) For the previous financial
year since these became
subsidiaries of the Company
subsidiaries
Private Limited
Place : IndoreDate : 23rd August 2010
For and on behalf of the Board of Directors
Sajid R Dhanani Director
Prosenjeet Roy ChoudharyDirector
Surendran R.Manager
95
ATTENDANCE SLIP
SAYAJI HOTELS LIMITED
Please complete this Attendance Slip and hand it over at the Entrance of the Meeting Hall
"Sayaji Hotel", Opp. Rajshree Talkies, Near Kala Godha, Sayajigunj, Vadodara-390 005
I hereby record my presence at the 27th Annual General Meeting at Registered Office of the Company on
Thursday, 30th September, 2010 at 12.30 P.M.
Member's / Proxy's Signature
Note : The copy of the Annual Report may please be broght to the Meeting Hall.
PROXY FORM
SAYAJI HOTELS LIMITED"Sayaji Hotel", Opp. Rajshree Talkies, Near Kala Godha, Sayajigunj, Vadodara-390 005
TEAR HERE
Master Folio No.
I/We
of
being a member/members of above named company hereby appoint
of
or failing him / her
of
Note : The Proxy must be deposited at the Registered Office of the Company not less than 48 hours before the time of
holding the meeting. The Proxy need not be member of the company.
Signature
Signed this day of 2010.
as my/our proxy to attend and vote on me/us any my/our behalf at the 27th Annual General Meeting of the Company to be
held on 30th September, 2010 and/or at any adjournment thereof.Thursday,
1. Name of the Share Holder(In Block Letter)
2. Regd. Folio No. / Client I.D. / DP ID.
3. No. of Shares held
4. Name of Proxy (In Block Letters)
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