Your Directors have pleasure in presenting the Eighteenth Annual Report of the Company
together with the Audited Accounts for the year ended 31st March 2013.
The performance of the Company for the financial year ended 31st March 2013
is summarized below: (Rs in crores)
|Profit before Depreciation, Interest & Tax (PBDIT)
|Profit Before Interest & Tax
|Profit Before Tax
|Less: Provision for
|- Current Tax & Wealth Tax
|- Deferred Tax
|- MAT credit entitlement
|- Short provision for earlier years
|Profit After Tax
|Balance brought forward from previous year
|Profit available for appropriation
|Less: Proposed Dividend
|Dividend Tax on the above
|Transfer to General Reserve
|Balance carried over to balance sheet
|Earnings per Share (Rs)
OPERATIONS / PERFORMANCE
During the year 2012-13 your Companys turnover decreased by 1% from Rs255.94
crores to Rs254.23 crores. The gross operating profit (PBDIT) was lower by 24% at Rs60.80
crores from the previous years Rs80.02 crores and the net profit was lower by 70% in
the current year at Rs8.78 crores compared to Rs29.33 crores of the previous year.
Your Directors are pleased to recommend a dividend of 25% (Rs0.50 per equity share) on
the Equity Shares of the Company for the financial year 2012-13. The outflow on account of
the dividend would be Rs3.67 crores including tax on Dividend.
EXPANSION PLANS Taj Krishna
The construction of an additional car parking facility along-with connecting bridge at
the existing premises of Taj Krishna has been completed.
Work has started on a 20,000 sq.ft. open banqueting facility over the car park which
will attract larger functions, exhibitions, conferences and events and with the synergy
already available between Taj Krishna and Taj Deccan with the interconnecting brigde, the
additional facility will bring in more room and F & B business to both properties.
Further, the landscaping at Taj Krishna is also planned to be improved along with a new
swimming pool, fitness centre and Jiva Spa.
GINGER HOTEL PROJECTS
The Company is also planning to enter the value for money segment through the
Ginger brand in Andhra Pradesh. Various options are being worked out by the
Ginger team based on the market survey.
INVESTMENT IN MUMBAI HOTEL PROJECT
The Company jointly with M/s. Greenridge Hotels and Resorts LLP (Greenridge - a GVK
Company) through its SPV M/s. Green Woods Palaces & Resorts Private Limited (Green
Woods) are setting up a 5 Star Deluxe (Luxury category) Hotel Project comprising of 275
rooms near Terminal 1C, at Mumbai International Airport Private Limited (MIAL), Santacruz,
Mumbai under the TAJ brand.
Necessary agreements to this effect have been entered into and the work is progressing
well on this project. TAJGVK in tranches would invest around Rs110.25 crores in the Hotel
Company has been allotted around 6 acres land in Yellahanka, Bengaluru for hotel
project. The Company is building a bridge across the land abutting Company land to connect
the National Highway. The hotel building plans are under evaluation.
Your Company, growing in a competitive and dynamic environment, places great importance
in the overall training and development of its employees, who make the decisive difference
in the hotel industry.
The total strength of employees of your Company for the year under review was about
1969, which included executives, bargainable staff, probationers, trainees, apprentices
and contract employees.
Industrial Relations throughout the year continued to remain cordial.
The three properties at Hyderabad and the property at Chennai are ISO 22000:2005
compliant by maintaining the desired norms for Food Safety Management Systems in Food
& Beverage operations.
The Equity Shares of your Company are listed on Bombay Stock Exchange Limited and The
National Stock Exchange of India Limited. It may be noted that there are no payments
outstanding to the Stock Exchanges by way of Listing Fees, etc.,
During the year Dr. Abid Hussain, Independent Director expired on 21st June,
2012. Dr. Abid Hussain was the Director since 2001. The Board acknowledged the immense
contribution of Dr. Abid Hussain and deeply regretted his demise.
In accordance with the Companies Act, 1956 read with the Articles of Association of the
Company, Mr. D R Kaarthikeyan, Mr. P Abraham, Mr. K Jayabharath Reddy and Mr. Krishnaram
Bhupal Directors, retire by rotation and being eligible have offered themselves for
re-appointment. Mr. S Anwar has been co-opted as an Additional Director on 4th
February 2013 and shall hold the office up to this Annual General Meeting. Your company is
in receipt of individual notice under section 257 of the Companies Act, 1956 for his
appointment as Director of the company. Your Board recommends the above appointment/
reappointment of Directors in the best interest of the company.
M/s. A F Fergusson & Company, Chartered Accountants, Hyderabad acting as the
internal auditors, have been conducting periodic audit of the operations of the Company,
and the Audit Committee has reviewed their findings.
The Statutory Auditors, M/s. Brahmayya & Co., Chartered Accountants, Hyderabad,
retire at the ensuing Annual General Meeting and have confirmed their eligibility and
willingness to accept office, if reappointed. Your Directors propose the reappointment of
M/s Brahmayya & Co., as Statutory Auditors to hold office until the conclusion of the
next Annual General Meeting of the Company.
During the year under review, your company has neither invited nor accepted any
deposits from the public.
PARTICULARS OF EMPLOYEES
Information as required under section 217(2A) of the Companies Act, 1956 read with the
Companies (Particulars of Employees) Rules, 1975 will be made available on request by the
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the provisions of section 217(2AA) of the Companies Act, 1956, the Board of
Directors, based on the representations received from the Operations Management, hereby
confirms that: i. In the preparation of the annual accounts, the applicable accounting
standards have been followed and that there are no material departures. ii. It has in the
selection of the accounting policies, consulted the Statutory Auditors and has applied
them consistently and made judgements and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the Company as at 31st
March 2013 and of the profit of the Company for that period. iii. It has taken proper and
sufficient care for the maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities, to the best of its knowledge and ability. There
are however, inherent limitations, which should be recognised while relying on any system
of internal control and records. iv. It has prepared the annual accounts on a going
Your Company is committed to maintain the highest standards of Corporate Governance. As
required under Clause 49 of the Listing Agreement with the Stock Exchanges, the report on
Management Discussion and Analysis, Corporate Governance as well as the Auditors
certificate on the compliance of Corporate Governance are annexed and form part of the
MANAGEMENT DISCUSSION AND ANALYSIS
Management discussion and analysis of the financial condition and results of operations
of the Company for the period under review as required under Clause 49 of the Listing
Agreement with the Stock Exchanges, is given a separate statement in the Annual Report.
IMPACT ON HOSPITALITY BUSINESS
The year 2012-13 was a challenging and tough year due to influx of competition, slow
down in the Indian economy along with global economic crisis. Though the storm had passed
there were still signs of turbulent weather for the global hospitality industry in the
year 2012-13. As whole, the industry looked pretty bright in many parts of the world.
There were some geographies of the globe that did well, while other geographies struggled
to achieve positive growth. An increase in the supply of new hotel rooms put pressure on
hotel rates throughout the season, but efforts on achieving higher occupancy rates and
garnering higher food and beverage business helped the hotel industry sail through this
The Audit Committee of the Company reviewed the financial statements for the year under
review at its meeting held on 30th April 2013 and recommended the same for the
approval of the Board of Directors. Your Companys effort towards conservation of
energy, which results in savings in consumption of electricity, a significant component of
the energy cost, is an ongoing process.
The Company continues to absorb and upgrade modern technologies and advanced hotel
management techniques in various guest contact areas, which includes wireless internet
connectivity in all the hotels.
FOREIGN EXCHANGE EARNINGS AND OUTGO
As required under Section 217(1)(e) of the Companies Act, 1956, read with rule 2 of the
Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the
information relating to foreign exchange earnings and outgo is given in Note No.22 iii
Your Directors would like to express their grateful appreciation for the assistance and
co-operation received from customers, banks, suppliers, shareholders, Central and State
Governments and other statutory authorities and others associated with the Company. Your
directors also wish to place on record their deep sense of appreciation for the excellent
contribution made by employees at all levels, during the year under review.
By Order and on behalf of the Board
Dr. G V Krishna Reddy
Date: 30th April 2013
Taj Krishna, Road No.1
Banjara Hills, Hyderabad 500 034