GMR Hotels and Resorts Limited

6th

Annual Report

FY 2013-14

GMR Hotels and Resorts Limited

REPORT OF THE DIRECTORS FOR THE FINANCIAL YEAR ENDED MARCH 31, 2014 To, The Members, GMR Hotels and Resorts Limited Your Directors hereby present the Sixth Directors Report and the Audited Financial Statements for the year ended March 31, 2014, together with the Auditors’ Report thereon. The main objective of your Company is to carry on the hotel business. Currently, your Company is running a Hotel which is situated within the premises of Rajiv Gandhi International Airport, Shamshabad, Hyderabad, known as Hyderabad Novotel Airport Hotel. The hotel is managed and operated by Accor Group, Singapore under the Novotel Brand by an arrangement with the Company. Recognitions/Hospitality Awards won by Novotel Hyderabad Airport during the reporting period. Novotel Airport Hotel certified “ISO 14001” by Bureau and Veritas Certificate of Excellence by Trip Advisor for Calendar Year 2014 (consecutive 4th

Year) Accor India ranked 20th Best Company to work for conducted by “Great Place to

Work Institute” Consecutive 3rd Year, the hotel has achieved the Times Food Award for Square in the

category Best Modern Global Cuisine for 2014. Novotel Airport Hotel was the second best performer for calendar year 2014 on

various parameters. FINANCIAL RESULTS

Particulars

For the year

ended March 31,

2014

(Rs. in Crs )

For the year

ended March 31,

2013

(Rs. in Crs)

Income from Operations 43.56 42.04

Other Income 0.10 0.12

Total Income 43.66 42.16

Total Expenses 33.15 35.35

Profit before Finance Charges and

Depreciation

10.51 6.81

Finance Charges 18.54 18.02

Depreciation and Amortization 12.70 12.64

Profit before Taxation (20.73) (23.85)

Provision for Taxation -- --

Profit after Taxation (20.73) (23.85)

GMR Hotels and Resorts Limited

DIRECTORS Composition of the Board of Directors As on the date of report, the Board of the Company comprises of the following directors: Mr. S G K Kishore Mr. C Prasanna Mr. M Mohan Rao Mr. SGK Kishore who retires by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment. As on the date of this report, the Company comprises of the following Board Committees Audit Committee Mr. S G K Kishore Mr. C Prasanna Mr. M Mohan Rao Nomination and Remuneration Committee Mr. S G K Kishore Mr. C Prasanna Mr. M Mohan Rao DIRECTORS’ RESPONSIBILITY STATEMENT Your Directors confirm that:-

1. in the preparation of the annual accounts for the financial year ended March 31, 2014, the applicable accounting standards have been followed along with proper explanation relating to material departures.

2. the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year ended March 31, 2014.

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

4. the Directors have prepared the accounts for the financial year ended March 31, 2014 on a ‘going concern’ basis.

GMR Hotels and Resorts Limited

HOLDING COMPANY The Authorised Share Capital of your Company is Rs.110,00,00,000/- divided into 11,00,00,000 equity shares of Rs.10/- each and Paid-up Share Capital is Rs.109,65,89,160/- divided into 10,96,58,916 equity shares of Rs.10/- each. The entire paid-up share capital is held by GMR Hyderabad International Airport Limited along with its nominees. Accordingly, your Company is a wholly owned subsidiary of GMR Hyderabad International Airport Limited. HUMAN RESOURCES AND DEVELOPMENT Recruitment: Your Company currently employs 230 Personnel. Learning and Development: Your Company provides opportunities to all its employees to attend training programs to groom the technical and soft skills. Corporate training programmes and regular training programmes on telephone etiquettes, grooming, hygiene, handling of safety equipment, fire evacuation drill are conducted on a regular basis. Specialized training programmes viz. Beverages, Baking and Culinary are conducted for specifically identified candidates. Employee Relations: The Management consistently focused on bonding the cordial relationship, motivating and enhancing the morale of all employees in the organization. Town Hall Meetings: Staff Meetings over Lunch are organised with the General Manager of the Organization and feedbacks are taken from all employees on their working conditions periodically. Information on their satisfaction levels with the services provided by the Organization are being obtained and necessary amendments done to meet the expectations of employees. Employee Development Initiatives: Better career plan, advanced training to Senior HODs and Executives to take up new responsibilities viz. GM Pass, RM Pass, Sales Trainings. AUDITORS M/s. S R Batliboi & Associates LLP, Chartered Accountants, [ICAI Firm Registration No.101049W], the present Statutory Auditors of your Company, retire at the ensuing Annual General meeting. Your Directors recommend the re-appointment of M/s. S R Batliboi & Associates LLP as Statutory Auditors of the Company for the Financial Year 2014-15, to hold office from the conclusion of the sixth Annual General till the conclusion of the Seventh Annual General Meeting. The Company has received a letter from M/s. S R Batliboi & Associates LLP to the effect that their appointment, if made, would be in accordance with Section 139 of the Companies Act, 2013 and that, they are not disqualified for such appointment within the meaning of Section 141 of the Companies Act, 2013.

GMR Hotels and Resorts Limited

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS & OUTGO The particulars as required under sub-section (1)(e) of Section 217 of the Companies Act, 1956, read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 are as under: A. Conservation of Energy and Technology absorption:

Providing timers for guest corridor lights,

Creating awareness amongst the staff on Energy consumption,

Planet 21 Accor Program for guest’s awareness.

Maximum utilization of Solar Panels to reduce the Fuel Consumption

Strictly following the time schedules for events and switching off the lights upon

even completion.

Switching off Chiller plant for two hours in the night time depends upon occupancy

and ambient temperatures.

All guest rooms 8W CFL’s have replaced older 40W bulbs.

Swimming pool circulation running 8 hours instead of 16 hours.

Changed Halogen Lamps with LED Lights

Installation of Motion Sensors in corridors

Complete Shutdown of 2 Floors whenever the Occupancy Levels are Low

Water Tap Sensors installed in all Public Areas and staff areas

Bio Diesel for Boilers & Steam Generator

Steam condensate captured.

Proposal for Installation of a ultra filtration unit to further clean STP water, addition

of storage to divert and re-circulate this resource towards the hotel’s cooling towers

B. Foreign Exchange Earning and Outgo: Particulars relating to foreign exchange earnings and outgo have been set out under Para 32 and 34 of Notes annexed to the audited financial statement for the period under review. PUBLIC DEPOSITS During the year under review, your Company has neither invited nor accepted any fixed deposits from the public as per the provisions of Section 58A of the Companies Act, 1956. As such, no amount of principal or interest was outstanding as on the date of the Balance Sheet. PARTICULARS OF EMPLOYEES Particulars required under Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975, as amended, are set out in the Annexure this report.

GMR Hotels and Resorts Limited

ACKNOWLEDGEMENT Your Directors take this opportunity to express their sincere thanks and gratitude to various Government Agencies, Accor Group, Customer, Suppliers, Employees and GMR Hyderabad International Airport Limited, for their co-operation and support.

By Order of the Board of Directors

Sd/- Sd/- Place: Hyderabad Date : July 24, 2014

S.G.K. Kishore Director

M Mohan Rao Director

GMR Hotels and Resorts Limited

Annexure to Directors’ Report for the year ended March 31, 2014

Particulars required under Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975.

Name of Employee

Designation Age Previous Employer

Date of Joining

Remuneration paid during the

year Qualifications

Total Years of

Experience

Nature of Employment

: Regular / Contract

Employed for Full

Year / Part of

the Year

Eric Laurent Rimbeuf

General Manager

43 Accor Feb 01, 2011

Rs.63,73,269 Diploma In Hotel Management

19 3 years contract

Full Year