The Directors take pleasure in presenting the 20th Annual Report to
 the Shareholders together with the Audited Accounts for the year ended
 30th September, 2012.
 
 FINANCIALS
 
                                                    (Rs. in Lakhs)
 
 PARTICULARS                                     2011-12     2010-11
 
 Income                                         14392.54    13461.43
 
 Expenditure                                    12960.08    12320.65
 
 Profit before Interest                          1432.46     1140.78 
 and Depreciation
 
 Interest                                         820.83      747.63
 
 Depreciation                                      56.35       53.92
 
 Profit before Tax and                            555.28      339.23 
 
 Exceptional items                                                 - 
 
 Exceptional items                                280.04           - 
 
 Profit before Tax                                275.24      339.23 
 
 Provision for tax                                 61.99       87.68 
 
 Profit after Tax                                 213.25      251.55 
 
 Previous year provision for Dividend added back       -       74.80
 
 APPROPRIATIONS
 
 Proposed Dividend                                 86.00       86.00
 
 Balance profit carried forward                   127.25      240.35
 
 PERFORMANCE
 
 The Company''s total Income is Rs.144 crores during the financial year
 2011-12 as against Rs.135 crores in the previous year 2010-11. The
 Profit after tax (PAT) for the financial year is Rs.2.13 crores
 compared to previous year profit of Rs.2.51 crores. On consolidated
 basis, the total income of your Company and its subsidiaries and Joint
 venture stands at Rs.225.74 crores and consolidated profit after tax
 (PAT) stood at Rs. 4.84 crores as compared to the previous year
 consolidated PAT of Rs.0.90 crores recording a four times increase in
 the consolidated profit.  The earnings per Share (EPS) basic and
 diluted stands at Rs.2.48 considering the total equity capital of
 Rs.8.60 crores (86,00,000 equity shares of Rs.10/- each) as on 30th
 September, 2012.
 
 It is evident from the above performance that the Company has fetched
 substantial profit during the year from its JV and Associates as many
 of the projects of the Company is in JV and with its Associates. In the
 coming years the Company also foresee good profits from its own
 projects and the JV Projects.
 
 A more detailed discussion and analysis on the performance of the
 Company in retrospect as well as the outlook is detailed in the
 Management Discussion and Analysis Report.
 
 MANAGEMENT DISCUSSION AND ANALYSIS REPORT
 
 The Management Discussion and Analysis Report as required under clause
 49 of the Listing Agreement with the Stock Exchanges is presented in a
 separate section forming part of the Annual Report.
 
 PROJECTS
 
 The Company recognises that conceiving, developing and implementing
 projects aimed at growth and meeting market requirements, in a cost
 effective and time bound manner, will always remain a key business
 policy of the Company. The Company''s Project managers are guided by
 this policy and principle in the successful implementation and
 completion of various projects.
 
 Project details:
 
 ONGOING PROJECTS
 
 Project name                        Location            Area (Sqft)
 
 VILLA VIVIANA                       GST Road,            13,00,000
 Township Project                    Chennai
 In association with J P 
 Morgan India Property Fund
 
 NORTH TOWN ESTATES                  Perambur,            21,26,880
 Township Project                    Chennai
 In association with PVP
 Ventures Ltd and Unitech Ltd.
 
 ARIHANT - FRANGIPANI                Pudupakkam,
 Residential Complex                 Chennai               2,80,000
 
 ARIHANT - PANACHE                   Arumbakkam, Chennai   1,05,400
 
 ARIHANT - JASHN                     Egmore,
 (Mixed development)                 Chennai                 36,831
 
 GREEN WOOD                          Thazambur,
 (Plotted development)               Chennai                 39.665 acres
 
 NEW PROJECT INITIATIVE:
 
 ARIHANT - ''ESTA                     Mugappair,
 Residential Complex                 Chennai               1,94,145
 
 DIVIDEND
 
 Your directors pleased to recommend final dividend for the financial
 year ended 30th September, 2012 @ 10% i.e.  Rs.1.00 per equity share on
 the paid-up equity shares of Rs.10/- each for the financial year ended
 30th September 2012, which if approved at the ensuing Annual General
 Meeting , will be paid to:
 
 i) all those shareholders whose name appears in the Register of Members
 as on 21st March 2013 and;
 
 ii) all those whose name appears on that date as beneficial owners as
 furnished by National Securities Depository Limited and Central
 Depository Services Limited.
 
 DEPOSITS
 
 The fixed deposits have been repaid in full during the year.
 
 SUBSIDIARY COMPANIES AND IT''S ACCOUNTS
 
 There are four subsidiaries of your Company as on 30th September, 2012.
 The financial details of the Subsidiary Companies as well as the extent
 of holdings therein are provided in a separate section of the Annual
 Report pursuant to Section 212 of the Companies Act, 1956.  Ministry of
 Corporate Affairs vide its general circular no.2/2011 dated 8th
 February, 2011 has issued a direction under Section 212(8) of the
 Companies Act, 1956 granting general exemption with respect to the
 provision of section 212 of the Companies Act, 1956. With the consent
 of the Board and following the aforesaid direction, the annual accounts
 and other details of Subsidiary Companies are not attached. However the
 annual accounts of subsidiary companies and related detailed
 information shall be made available to shareholder''s of holding &
 subsidiary companies seeking such information at any point of time. The
 Annual accounts of the subsidiary companies shall also be kept for
 inspection by any share holder''s in the corporate office and
 registered office of the holding company and of the subsidiary
 companies concerned and a note to the above effect will be included in
 the details of accounts of subsidiaries to any share holder on demand.
 
 CONSOLIDATED FINANCIAL STATEMENTS
 
 In accordance with the Accounting Standard AS-21 on consolidated
 financial statements read with Accounting Standard AS-23 on investment
 in associates, AS-27 on financial reporting of interest in Joint
 Venture, Auditors Report on the consolidated financial statements,
 audited consolidated Balance Sheet, Profit and Loss account and Cash
 flow statements are provided in the Annual Report.
 
 REPORT ON CORPORATE GOVERNANCE
 
 Your Company ensures good corporate governance by implementing and
 complying with the polices, standards set out by Securities and
 Exchange Board of India and other regulatory authorities. The requisite
 certificate issued by M/s. B.P Jain & Co., Chartered Accountants
 confirming compliance with the conditions of Corporate Governance as
 stipulated under clause 49 of the Listing Agreement, is attached to
 this Report.
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN -EXCHANGE
 EARNINGS AND OUTGO.
 
 The necessary details are furnished in Notes to Financial statements no
 29.
 
 PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A)
 
 During the period under review, no employee was in receipt of
 remuneration in excess of the limits laid down in Subsection (2A) of
 Section 217 of the Companies Act, 1956.
 
 DIRECTORS
 
 In accordance with the relevant provisions of the Companies Act, 1956
 and Articles of Association of the Company, Mr. A. L Jayabhanu and Mr.
 A Damodaran, Directors are liable to retire by rotation at the ensuing
 Annual General Meeting and, being eligible, offer themselves for
 reappointment. The brief resume of directors, who are to be
 re-appointed as stipulated under clause 49(IV) of the Listing
 Agreement, are furnished in the Corporate Governance Report forming
 part of the Annual Report.
 
 DIRECTORS RESPONSIBILITY STATEMENT
 
 Pursuant to the requirements under Section 217 (2AA) of the Companies
 Act, 1956, the Board of Directors of the Company hereby state and
 confirm that:
 
 i.  In the preparation of the annual accounts, the applicable
 accounting standards have been followed along with the proper
 explanations relating to the material departures;
 
 ii.  The Directors have selected such accounting policies and applied
 them consistently and made judgments and estimates that are reasonable
 and prudent so as to give a true and fair view of affairs of the
 company at the end of the financial year and of the profit or loss of
 the company for that period.
 
 iii. Proper and sufficient care have been taken to maintain adequate
 accounting records in accordance with the provisions of this Act to
 safeguard the assets of the company and to prevent and detect fraud and
 other irregularities.
 
 iv.  The annual accounts have been prepared on a going concern basis.
 
 AUDITORS
 
 M/s B.P Jain & Co., Chartered Accountants, Auditors of the Company hold
 office until the conclusion of the ensuing Annual General Meeting. The
 Company has received a letter from them to the effect that they offer
 themselves for reappointment and if appointed, it would be within the
 prescribed limits under Section 224(1 B) of the Companies Act, 1956.
 
 INVESTOR RELATIONS
 
 Your Company always endeavors to keep the time of response to
 shareholders'' requests/ grievances at the minimum. Priority is
 accorded to address all the issues raised by the shareholders and
 provide them a suitable reply at the earliest possible time. The
 Shareholders'' and Investors'' Grievance Committee of the Board met
 to review the redressal of investors grievances. The shares of your
 Company are continued to be traded in Electronic Form and the
 dematerialisation arrangement exists with both the depositories, viz.,
 National Securities Depository Limited (NSDL) and Central Depository
 Services (India) Limited (CDSL). As on 30th September, 2012, 6605720
 (Sixty six lakhs Five thousands Seven hundred and twenty only) shares
 have been dematerialised, representing 76.81% of the subscribed
 capital.
 
 LISTING
 
 The shares of your Company are listed in Madras Stock Exchange Limited,
 Bombay Stock Exchange Limited and National Stock Exchange of India
 Limited. The Company has paid the listing fees for the Financial Year
 2011-2012 to the Stock Exchanges where its securities are listed.  The
 listed capital of the Company with BSE and NSE is 86,00,000 fully
 paid-up equity shares of Rs.10/- each.
 
 The Company had made a request to Madras Stock Exchange Ltd for
 delisting its entire securities (70,00,000 equity shares of Rs.10/-
 each) voluntarily after obtaining the approval of shareholders at the
 15th Annual General Meeting of the Company held on 28.03.2008.
 Delisting approval from MSE is awaited. The Company has also complied
 with the amendments in listing agreement from time to time.
 
 TRANSFER OF UNPAID DIVIDEND TO IEPF (INVESTOR EDUCATION AND PROTECTION
 FUND)
 
 Details of unclaimed Dividend:
 
 Financial      Date of         Unpaid         Due date for
 Year           Declaration     Dividend       transfer
                of Dividend     amount         to IEPF.
                                As on
                                30.09.2012 
                                  (Rs.)
 
 2004-05       24-03-2006         7488.20      22-04-2013
 
 2005-06       23-03-2007       89,666.00      21-04-2014
 
 2006-07       28-03-2008     1,92,744.00      26-04-2015
 
 2007-08       20-03-2009       64,857.00      18-04-2016
 
 2008-09       26-03-2010     1,44,331.00      24-04-2017
 
 2010-11       30-03-2012       66,376.00      28-04-2019
 
 The Shareholders are requested to claim their unclaimed dividends
 before the aforementioned due dates. The unpaid dividend transferred to
 IEPF, cannot be claimed by the Shareholders.
 
 THE COMPANIES (COST ACCOUNTING RECORD) RULES, 2011
 
 The Ministry of Corporate Affairs vide notification dated 3rd June,
 2011 have issued Companies (Cost Accounting Record) Rules, 2011 and
 made mandatory, the maintenance of cost accounting records and filing
 of a compliance report in respect thereto with Registrar of Companies
 for each financial year commencing on or after the 1 st day of April,
 2011. The aforesaid Rule is applicable to your Company.
 
 Pursuant to the aforesaid Rules, Mr. Srinivasan Ramachandran,
 Practicing Cost Accountant was appointed as a Cost Auditor of the
 Company and has submitted a duly certified copy of the Compliance
 Report, along with necessary Annexure in prescribed format. The
 observation made in the said report are self explanatory.
 
 PERSONNEL
 
 The Board wishes to place on record its appreciation of all employees
 of the Company, for their wholehearted efforts and contribution to the
 performance and growth of the Company.
 
 ACKNOWLEDGEMENTS
 
 Your Directors place on record their gratitude for the support and co-
 operation received from CMDA, Corporation of Chennai, ELCOT, Banks and
 Financial Institutions, Customers, Suppliers and Shareholders and for
 their continued support. The Board also wish to place its sincere
 appreciation to the dedicated and committed team of employees.
 
                          For and on behalf of the Board of Directors
 
                                Arihant Foundations & Housing Limited
 
                                  Sd/-              Sd/-
 
                           (KAMAL LUNAWATH)    (VIMAL LUNAWATH)
 
                          Managing Director   Whole time Director
 
 Date:13.02.2013
 
 Place: Chennai