The Directors are pleased to present the 25th Annual Report of CRISIL
 Limited, along with the audited accounts for the year ended December
 31, 2011.
 
 PERFORMANCE
 
 A summary of the Company’s financial performance in 2011:
 
                                                     (Rupees Lakh)
 
                                           Year ended       Year ended 
                                           December         December 
                                           31, 2011         31, 2010
 
 Total Income for the year was            68,217.01        60,233.43 
 
 Profit before depreciation and
 taxes was                                26,924.68        27,192.65
 
 Deducting depreciation of                 2,168.46         2,020.85
 
 Profit before tax was                    24,756.22        25,171.80
 
 Deducting taxes of                        6,105.00         5,321.90 
 
 Profit after tax and before prior
 period items                             18,651.22        19,849.90
 
 Prior period expenses, net of tax            -               274.45
 
 Profit after tax                         18,651.22        19,575.45 
 
 The proposed appropriations are:
 
 Dividend                                  7,781.55        14,417.96
 
 Corporate Dividend Tax                    1,255.52         2,387.67
 
 General Reserve                           1,865.12         1,957.54
 
 Balance carried forward is               31,302.39        23,553.37
 
 DIVIDEND
 
 The Directors recommend, for approval of the members at the Annual
 General Meeting to be held on April 16, 2012, payment of final dividend
 of Rs.2.75 per share for the year under review. During the year, the
 Company paid first and second interim dividends of Rs.27.5 per share
 each on face value of Rs.10 per equity share and a third interim
 dividend of Rs.2.75 per share on face value of Re.1 per equity share.
 The total dividend for the year works out to Rs.11 per share on a face
 value of Re.1 per share as against Rs.100 per share on a face value of
 Rs.10 per share for 2010. In addition the Company paid a special
 dividend of Rs.100 per share on a face value of Rs.10 per share in
 2010.
 
 SUBDIVISION OF EQUITY SHARES
 
 The Board of Directors at its meeting held on July 20, 2011 approved a
 proposal to sub-divide the face value of equity shares of the Company
 from Rs.10 to Re.1 per share. The Company received shareholders
 approval through postal ballot for sub-division of shares on September
 5, 2011.
 
 The record date fixed for sub-division was September 30, 2011 and the
 sub-division became effective from October 1, 2011. Shareholders with
 equity shares of Rs.10 each of the Company in electronic form received
 direct credit of the sub-divided shares of Re.1 each of the Company to
 their depository account. The Company issued a new composite share
 certificate of Re.1 each in place of the old share certificate, for
 shareholders holding shares in physical form.
 
 BUYBACK OF EQUITY SHARES
 
 The Board of Directors, at its meeting held on October 18, 2011,
 approved the buyback of equity shares of the Company for a total
 consideration not exceeding Rs.80 crore and at a price not exceeding
 Rs.1000 per equity share of Re.1 each from the open market through the
 stock exchanges. The Company received shareholders approval through
 postal ballot for the buyback on December 7, 2011, and issued a public
 announcement on December 13, 2011. The buyback commenced on December
 26, 2011 and closed on December 30, 2011. The Company bought back
 910,000 equity shares at an average price of Rs.871.06 per equity
 share.
 
 The paid-up equity share capital of the Company (pre and post buyback
 of shares) is as follows:-
 
 Share Capital of the company (pre and post Buyback)
 
 Sr 
 No.   Particulars                        No.of           shares 
                                          Shares          Capital
                                                         (Rupees)
 
       Paid up Equity Share
 1     Capital (Pre Buyback)             7,09,68,440      7,09,68,440
 
       Total Equity Shares
 2     bought back                          9,10,000         9,10,000
 
       Paid up Equity Share
 3    Capital (Post Buyback)             7,00,58,440      7,00,58,440
 
 
 REVIEW OF OPERATIONS
 
 A.  RATINGS Highlights
 
 Over 8,000 Bank Loan Ratings (BLRs) outstanding, the largest number of
 BLRs in India; 2,760 new ratings announced during the year
 
 - Constituted the Analytical Quality Board to continuously review rating
 quality metrics, macroeconomic environment and monitor quality metrics
 to ensure rating quality remains strong
 
 - Crossed 30,000 small and medium enterprise (SME) ratings/ assessments
 
 - Launched CRISIL Business School Gradings - Indias first grading
 services for the education sector. Partnered with The Indian Institute
 of Management, Ahmedabad (IIM-A) in auditing placement information
 under the Indian Placement Reporting Standards
 
 - Global Analytical Centre (GAC) increased its support to new
 geographies, supported high-end analytics for S&P Ratings and initiated
 product operation support for S&P Capital IQ
 
 Business Environment
 
 The domestic business environment remained challenging for most of
 2011, due to high interest rates, tight liquidity, and the focus of
 monetary policy to rein in inflation. Indias corporate bond market
 remained inactive for most of the year, with issuers delaying long-term
 issues, expecting interest rates to peak by early 2012. The global
 conditions also deteriorated with deepening of the Eurozone crisis.
 
 Steady increase of base rates by banks, however, made short-term
 capital market instruments attractive for corporates in the last
 quarter of 2011 - when there was increased issuance of commercial paper
 by some companies. Despite a sluggish business environment, BLRs
 maintained healthy growth over the previous year.
 
 The bond market is expected to remain subdued in the first half of
 2012, on account of continued high interest rates, constrained
 liquidity in the economy, and expected recession in the Eurozone. The
 long-term prospects, however, remain strong because of expected
 domestic growth and increased demand for funding infrastructure growth
 in the country. The BLR market is expected to remain stable in 2012.
 
 Despite the challenging macro environment, the demand for SME ratings
 remained steady during the year. This was on account of intensive
 outreach activities, leading to enhanced awareness, increased
 acceptance of our ratings by banks, and expansion into new markets and
 territories.  The demand for SME ratings is expected to remain robust
 in 2012, despite the economic headwinds.
 
 GAC will continue to play a critical role for S&P Ratings and S&P
 Capital IQ, driven by the changing dynamics of the global credit
 markets, conscious cost management initiatives, and S&Ps focus on
 excellence in ratings and services.
 
 Operations
 
 Despite the challenging business environment and increased competition,
 CRISIL Ratings maintained its market leadership in 2011, backed by
 strong performance in the BLR business. CRISIL announced 2,760 new BLRs
 during the year. CRISIL SME Ratings maintained its market leadership in
 2011, backed by a steady performance across most regions in the
 country. CRISIL now has assigned over 30,000 SME ratings/assessments.
 CRISIL Real Estate Star Ratings (CREST) launched in 2010 has been well
 accepted for the real estate sector and witnessed significant demand
 pick up this year with leading developers across several cities
 choosing to get their projects graded by CRISIL.
 
 CRISIL Ratings launched CRISIL Business School Grading, Indias first
 independent and rigorous grading service for the education sector.
 Through this service, CRISIL aims to recognise and nurture quality
 management education, while helping employers and aspiring management
 graduates find business schools that best match their needs. The
 product has received an encouraging response from all stakeholders,
 business schools and students. CRISIL business school gradings also
 partnered with IIM-A in auditing placement information under the Indian
 Placement Reporting Standards.
 
 CRISIL Ratings organised discussion forums on non-banking finance
 companies (NBFCs) and the power sector, with CEOs from the leading
 companies as speakers and panelists. The forums received extensive
 media coverage.  CRISIL Ratings commentaries, including those on MFIs,
 gold loan companies, textile units, cement producers, diamond prices,
 auto sector, gold retailers, and toll roads were also timely and
 impactful, and were well received.
 
 CRISIL has continued to conduct regular outreach programmes to provide
 value to investors and market participants. A large number of events
 including leadership conclaves, bankers meetings, and seminars were
 conducted, which helped CRISIL reach companies and bankers across the
 country.
 
 GAC consolidated its relationship as a preferred knowledge partner for
 S&P Ratings and S&P Capital IQ. GAC continued to see good traction for
 its services as S&P Ratings strengthened its criteria and ratings
 function and S&P Capital IQ repositioned itself into a premier
 financial intelligence provider. GAC set up new operations in Pune to
 support the S&P businesses.
 
 B.  RESEARCH
 
 3.1. GLOBAL RESEARCH & ANALYTICS
 
 (INCLUDES IREVNA AND PIPAL RESEARCH)
 
 Highlights
 
 - Integrated Pipal Research, which was acquired in December 2010
 
 - Repositioned our knowledge off-shoring business (Irevna and Pipal) as
 CRISIL Global Research & Analytics (GR&A)
 
 -Large new client additions, including several global financial
 institutions and Fortune 500 companies
 
 -Published the most comprehensive research report on the global
 knowledge services industry in association with NASSCOM
 
 - Opened a new research centre in Pune, and a second office in Buenos
 Aires to support growth
 
 Business Environment
 
 The global economic environment remained volatile through 2011, driven
 by continuing uncertainty in Europe, and weakening economic situation
 in USA. This impacted financial market volumes, leading to weak
 business performance by most market participants, and cost reduction
 exercises, including staff reductions and closure of business segments
 and desks. Increased regulatory scrutiny and demand for more
 information, analysis and documentation drove up compliance costs,
 adding to pressure on the financial markets to improve operating
 efficiencies. The economic turmoil also impacted the corporate segment
 (manufacturing and non-financial services) across the globe, forcing it
 to restructure and improve efficiencies.  The overall theme in the
 market place has been to do more with less. This environment
 presented CRISIL GR&A with an opportunity to provide solutions to its
 clients to meet regulatory requirements, improve efficiencies, enhance
 revenues, and strengthen market presence. We considerably deepened our
 engagement with clients, who looked to us as a strategic partner,
 working in tandem with them in the difficult operating environment.
 
 The global business environment is expected to remain challenging in
 2012 due to uncertainty surrounding EU and the Euro, dim growth
 prospects in the US and expected slowdown in China. Significant changes
 in regulations and compliance requirements for banks and financial
 institutions in USA and Europe are also expected to impact the
 industry.
 
 Operations
 
 The business was repositioned as CRISIL Global Research & Analytics, on
 the basis of an in-depth survey of over 50 stakeholders, including
 customers, employees, media and industry bodies. The new positioning
 leverages on the CRISIL brand in the market, and has been well
 received.
 
 CRISIL GR&A has maintained its leadership position in the research and
 analytics space. We added a large number of new clients in 2011,
 including several of the worlds largest financial institutions and
 Fortune 500 companies. Our high quality research has enabled our
 clients to improve their institutional ranking, increase coverage of
 sectors/country/ stocks, enter new markets, get better business
 insights, and deliver new path-breaking research in the current
 uncertain environment. Our strong derivatives, quantitative, risk and
 actuarial specialists helped clients apply strong analytics to internal
 models, transition to more robust risk and trading platforms, and
 measure risk in a more real-time manner.
 
 Pipal Research has been successfully integrated as part of the CRISIL
 GR&A business. The business has benefited from the support by the
 global business team, strong people engagement and training programmes,
 and robust and scalable support functions. Pipal added a large number
 of new clients in 2011, and grew several existing client engagements
 and relationships.
 
 Our franchise-building initiatives gained momentum during the year - we
 published the most comprehensive study in India on the global knowledge
 services industry, jointly with NASSCOM and actively participated in
 several global conferences and seminars.
 
 Our global business model has continued to scale up well to support
 demand from clients. Our research centres in Hangzhou (China), and
 Buenos Aires (Argentina) and our quantitative research centre in
 Wroclaw (Poland) have grown significantly. We opened a second research
 centre in Buenos Aires, and a new research centre in Pune, adding to
 our talent base.
 
 B.2. INDIA RESEARCH Highlights
 
 -Prepared research reports on all 1,401 companies listed and traded
 on the National Stock Exchange (NSE). The reports are available to
 investors free of cost on the NSE website 
 
 - Completed a prestigious assignment for the Employee Provident Fund
 Organisation (EPFO), to select fund managers for managing EPFOs corpus
 Launched 5 new indices, including CRISIL Gilt Index and CRISIL Gold
 Index
 
 - Released a comprehensive report on Indian infrastructure, detailing
 investment opportunities in the sector over the next five years
 
 - Released an India-specific report on ultra-high-net-worth
 individuals, in association with Kotak Mahindra Bank
 
 Business Environment
 
 The business environment has turned increasingly challenging and
 volatile in the last few quarters. High inflation, rising interest
 rates, slowdown in growth, and growing uncertainty in the global
 economy have been a setback to the domestic capital markets. Sharp
 decline and volatility in the equity markets affected the equity
 research and IPO grading businesses of CRISIL Research.  In customised
 research, the flow of mandates has been positive, with corporates
 valuing our independent research inputs highly.
 
 Operations
 
 Despite the challenging business environment, CRISIL Research continued
 to build on its powerful value proposition of timely and relevant
 research. The industry research, with its improved product offering,
 secured higher subscription renewals over the previous year. The
 revamped subscription-based web platform (www.crisilresearch.com),
 providing near-real-time access to research, has been well received.
 
 CRISIL Research continues to proactively launch products that address
 evolving market dynamics and customer requirements. During the year,
 the industry research business expanded coverage by adding more
 sectors, and released three special reports - on real estate, retail
 loans and infrastructure sector. In addition, CRISIL Research, in
 association with Kotak Mahindra Bank, developed a report, Top of the
 Pyramid on ultra-high-net-worth individuals (UHNIs).
 
 CRISIL Researches equity research segment completed an assignment of
 preparing research reports on all 1,401 companies that are listed and
 trading on NSE. It also released its 100th independent equity research
 report during the year. CRISIL Research also reduced time-to- market on
 quarterly updates, with 90% of first-cut analysis being released within
 24 hours of declaration of results.
 
 CRISIL Researchs funds and fixed income research business completed a
 prestigious assignment of selecting fund managers to manage the EPFO
 corpus. CRISIL Research continues to assist EPFO in evaluating the
 performance of selected fund managers. It also launched 5 new indices -
 CRISIL Gilt Index, CRISIL Gold Index, CRISIL
 
 10-Year Gilt Index, CRISIL 1-Year T-Bill Index, and CRISIL 91-Day
 T-Bill Index - to provide independent, relevant and transparent
 benchmarks of performance evaluation.
 
 CRISIL Centre for Economic Research (C-CER) continued to focus on
 research on macroeconomics in India and the Asia Pacific, consistently
 building CRISILs franchise in the Indian and foreign media and
 positioning the Company as the foremost analytics-based commentator on
 the economy in the region.
 
 C-CER published five special economy insight papers covering
 contemporary macroeconomic issues such as inflation, employment,
 exchange rate, and methodological issues in Indian GDP and industrial
 data. It also released a special report, Bracing for a Crisis:
 Sustainable Water Management and Corporate India. C-CERs analysis of
 monetary policy was featured as the top research article in Asia for
 September 2011 by Consensus Economics in their publication, Current
 Economics.
 
 C. INFRASTRUCTURE ADVISORY AND RISK SOLUTIONS CRISIL conducts its
 infrastructure advisory and risk solutions business through its
 subsidiary, CRISIL Risk and Infrastructure Solutions Limited (CRIS).
 
 C.1. CRISIL INFRASTRUCTURE ADVISORY BUSINESS Highlights
 
 - Assisted Insurance Regulatory and Development Authority (IRDA) in
 assessing Indias debt securities market for its impact on IRDAs
 investment norms
 
 - Designed and prepared a credit enhancement mechanism to enable
 infrastructure development companies to issue bonds, and attract
 long-term savings capital
 
 - Extended advisory services to Government of Vietnam to set up a
 viability gap financing (VGF) mechanism and fiscal risk management
 (FRM) framework, and in the preparation of a pilot PPP transaction
 
 - Assisted Tanzanias Energy, Water Utility Regulatory Authority
 (EWURA) in designing a regulatory information management system, and in
 auditing performance parameters
 
 Business Environment
 
 The challenging economic environment has impacted the domestic advisory
 business. Weak equity markets, high costs of borrowing, delay in
 critical reforms and policy decisions with respect to land acquisition,
 mining, and power sector have forced corporates to defer investment
 decisions, especially in the private sector. CRISIL infrastructure
 advisory business has, however, continued to grow by expanding its
 services across new verticals and geographies focusing on business from
 the Government and public sector during the year.
 
 The grim macroeconomic conditions are expected to improve over the
 medium term. Progress on reforms and policy are also expected. With
 investments of USD 1 trillion envisaged in infrastructure during the
 12th Five Year Plan period, the infrastructure sector is bound to
 witness increased activity. A significant proportion of this investment
 is targeted towards the urban, energy, transportation and logistics
 sectors, which shall offer a sizable opportunity for CRIS. In the next
 Five Year Plan period, government, private and not-for-profit sectors
 are expected to focus on improving access to and quality of, health and
 education and that will offer CRIS an opportunity to play an important
 role in the emerging social infrastructure space. Infrastructure
 advisory is poised to tap this growing market with its newly created
 social infrastructure vertical which would complement the existing
 capabilities in the physical infrastructure. Over the medium to long
 term, the advisory business would benefit from its established position
 across physical and social infrastructure sectors.
 
 Operations
 
 CRIS has reconfigured Infrastructure Advisory operations into
 domain-based verticals and created new verticals in promising sectors
 such as healthcare, transport & logistics, and natural resources. This
 has enhanced focus on individual sectors and helped consolidate and
 differentiate its position in the infrastructure advisory services.
 
 Revenues in infrastructure advisory, especially verticals that are
 dependent on private sector investment, were impacted by the slowdown.
 However, new verticals such as transport and natural resources and
 exploratory foray into the financial services besides the India
 government business, have helped CRISIL Infrastructure Advisory
 business post growth over the previous year.
 
 CRISIL infrastructure advisorys international operations remain
 strongly focused on Africa and Southeast Asia, backed by a slew of
 assignments in Tanzania, Cambodia, Vietnam, Namibia, Mozambique, and
 South Africa. The renewal of the World Banks contract with CRIS to
 assist EAPIRF in enhancing the regulatory reform capabilities of member
 regulators is a strong testimonial to CRIS’ credentials as an enabler
 of regulatory efficiency beyond the Indian shores.
 
 C.2. CRISIL RISK SOLUTIONS (CRS)
 
 Highlights
 
 -Expanded coverage in the global market, won mandates in multiple
 continents
 
 - Portfolio of customers now includes 9 of Indias top 10 banks
 
 - Launched flagship internal rating solution, RAM, under larger
 global brand, S&P Credit Risk Evaluator
 
 - Developed Market Risk System to enable automation of a banks market
 risk capital assessment - an important element for Basel II
 implementation
 
 Business Environment
 
 Banks in most regions continue to invest considerable resources towards
 augmenting their internal risk management frameworks, in the face of a
 systems crisis gripping the global banking system. In most developed
 and developing economies, banks and financial institutions have made
 considerable progress towards complying with Basel II requirements,
 especially those pertaining to credit risk and the Standardised
 Approaches of Basel II.
 
 CRS believes that continued steady investments in risk management
 systems and framework enhancements are likely over the medium term, as
 institutions move from simpler approaches of Basel II to advanced
 approaches in the areas of credit, market and operational Risk. CRS
 products and services across the risk spectrum are, therefore, likely
 to be in increasing demand.
 
 CRS has partnered with S&P Risk Solutions for re-branding and
 joint-marketing of its flagship product, RAM, under the S&P brand,
 labelled as Credit Risk Evaluator. This association will help CRS
 leverage S&Ps risk solutions reputation and global reach to position
 and market its flagship product globally.
 
 Operations
 
 CRS, continuing its focus on both consulting and software solutions,
 won and executed multiple assignments both in India and
 internationally.
 
 CRS steadfastly concentrated on expansion of its product coverage, and
 on increasing its product usability.  Enhancements have helped
 strengthen the product suites positioning as comprehensive end-to-end
 solutions, encompassing risk measurement and process management. CRS
 has developed Market Risk System to enable automation of a banks
 market risk capital assessment which was an important piece in solving
 the Basel II jigsaw. It has helped CRS win turnkey mandates from
 financial institutions.
 
 Intensified business development initiatives in countries outside India
 have begun to yield results, with mandates coming in from Sri Lanka,
 Bangladesh, Kenya, Mauritius, the Netherlands, and USA. The business
 continues to maintain internal process standards at ISO 9001:2008
 certification levels.
 
 D.  COLLABORATION WITH S&P
 
 CRISIL and S&P jointly released the Standard & Poors Indices Vs Active
 (SPIVA) reports for Indian mutual funds industry. This report, a
 bi-annual publication, compares the performance of indices and active
 funds.
 
 CRISIL Risk Solutions partnered with S&P Risk Solutions to launch its
 flagship internal rating solution, RAM, under the larger global brand,
 S&P Credit Risk Evaluator. Besides the product support service for the
 extant clients of S&P Credit Risk Evaluator would be managed by CRS.
 
 CRISIL is actively involved with S&P in rebalancing and maintaining the
 S&P ESG (Environment, Social and Corporate Governance) India Index. The
 50-stock Index, developed by a consortium of Standard & Poors, CRISIL
 and KLD Research and Analytics, is a financial tool to investors who
 look beyond financial criteria, to integrate the social, environmental
 and governance conduct of firms into their investment decisions. The
 universe for S&P ESG Index includes the top 500 Indian companies as per
 market capitalisation.
 
 As part of the collaborative efforts, C-CER published 9
 reports/articles on Asia-Pacific economies for S&P
 
 E.  HUMAN RESOURCES
 
 2011 was a significant year for CRISILs Human Resources team, in
 furthering its talent attraction, retention and development agenda.
 CRISILs headcount increased to 3,207 as on December 31, 2011 from
 2,805 a year ago.  New employees were added across 7
 countries/locations, including new research centres in Hangzhou (China)
 and a SEZ in Pune. The training and leadership development agenda has
 been a key focus through the year. Targeted HR interventions resulted
 in significant increase in employee engagement scores for all levels
 across the Company including the Pipal business that was acquired in
 December 2010.
 
 Highlights
 
 - Strengthened the senior management team
 
 - Helped the CRISIL brand maintain its strong presence on campuses,
 making 242 offers in 56 business schools
 
 - Expanded CRISILs global footprint by establishing presence in China.
 CRISIL now has presence in Argentina, Australia, China, India,
 Singapore, Hong Kong, Poland, the UK, and USA
 
 - Selected 43 new participants to join the reputed CRISIL Certified
 Analyst Programme (CCAP), which entered its fifth year in 2011
 
 - CRISIL GR&A won the prestigious NASSCOM Exemplary Talent Practices
 Award (NEXT Practices) for skill enhancement
 
 - Launched CRISIL Connect, the new intranet, which is now a vibrant
 platform for employees to engage with colleagues across the globe.
 
 Attracting and Developing Talent
 
 The CRISIL Certified Analyst Programme (CCAP) has been helping improve
 the employability of students in the financial sector since 2006. On
 similar lines, CRISIL launched the six-month internship, CRISIL
 Certified Internship Programme (CCIP) to help graduates enhance and use
 their knowledge of finance. The annual CRISIL Young Thought Leader
 (CYTL) competition went global this year, drawing 197 responses from
 students of 81 business colleges in Argentina, China, Poland and India.
 
 CRISIL is committed to enhancing employee engagement through structured
 communications with business leaders and managers, and a robust rewards
 and recognition framework. The rewards and recognition programme was
 modified to ensure higher transparency, uniform winner delight,
 coverage across all grades and designations, and greater visibility for
 winners.
 
 The fourth CRISIL-wide Employee Engagement Survey saw a significant
 increase in overall engagement scores, especially for factors such as
 Relationship with Reporting Manager, Opportunity for Growth and
 Development, Senior Management Focus, and Rewards and Recognition.
 
 There was continued focus on employee development through customised
 skill enhancement across businesses
 
 - 730 training programmes, aggregating 81,900 man hours of training
 were conducted during the year. Over 70% of the programmes were led by
 in-house subject matter experts to ensure relevance, and address
 specific gaps in competency and skill for each grade. The programmes
 ranged from technical subjects to functional and behavioral skill
 enhancement.
 
 During the year, 22 employees received remuneration of Rs.6 million or
 more per annum. In accordance with the provisions of Section 217(2A) of
 the Companies Act, 1956 and the rules framed there under, the names and
 other particulars of employees are set out in the annexure to the
 Directors Report. In terms of the provisions of Section 219(1) (b)
 (iv) of the Companies Act, 1956, the Directors Report is being sent to
 the shareholders without this annexure. Shareholders interested in
 obtaining a copy of the annexure may write to the Company Secretary at
 CRISILs registered office.
 
 F.  SUBSIDIARIES
 
 The Board of Directors have approved a resolution on October 18, 2011
 for not attaching individual annual reports of its subsidiary companies
 to its annual report. A statement containing brief financial details of
 these companies is included in the annual report. The annual accounts
 of the subsidiary companies and the related information will be made
 available to shareholders who seek such information.
 
 G.  JOINT VENTURE - INDIA INDEX SERVICES AND PRODUCTS LIMITED
 
 India Index Services and Products Limited (IISL), CRISILs 49:51 joint
 venture with the National Stock Exchange of India Limited (NSE),
 provides a variety of indices and index-related services and products
 to capital markets. IISL has a licensing and marketing agreement with
 S&P Indices, the worlds leading index provider.  In 2011, IISL
 licensed indices to various asset managers in India including insurance
 companies and asset management companies, to facilitate the launch of
 index funds, exchange-traded funds and insurance products and the issue
 of debentures with returns linked to the S&P CNX Nifty Index. IISL also
 concluded licensing agreements for the issue of structured products
 linked to the S&P CNX Nifty Index outside India. In response to market
 requirements, IISL also launched a few broad-based, thematic and
 sectoral indices during the year - CNX Smallcap Index, CNX Dividend
 Opportunities Index, CNX Consumption Index, CNX Commodities Index, CNX
 Auto Index, CNX Finance Index, CNX Metal Index, CNX 200 Index and CNX
 Media Index.
 
 H.  DIRECTORS
 
 Mr. Deven Sharma resigned as Chairman of the Board and Director of the
 Company on September 30, 2011. Your
 
 Directors wish to place on record their sincere appreciation of the
 valuable contribution made by him to CRISIL.
 
 Mr. Thomas Schiller resigned as a Director of the Company on January
 11, 2012. Your Directors wish to place on record their sincere
 appreciation of the valuable contribution made by him to CRISIL.
 
 The Board of Directors appointed Mr. Douglas Peterson as an additional
 Director and Chairman of the Board with effect from October 28, 2011.
 Mr. Douglas Peterson holds office as an additional Director until the
 next Annual General meeting.
 
 The Board of Directors appointed Mr. Yann Le Pallec as an additional
 Director with effect from February 17, 2012.  Mr. Yann Le Pallec holds
 office as an additional Director until the next Annual General Meeting.
 
 Mr. Ravinder Singhania was appointed as an Alternate Director to Mr.
 Douglas Peterson and Mr. Yann Le Pallec on February 17, 2012.
 
 In accordance with the articles of association of the Company and the
 provisions of the Companies Act, 1956, Mr. David Pearce and Ms. Rama
 Bijapurkar retire by rotation and being eligible, offer themselves for
 reappointment.
 
 I.  AUDITORS
 
 The Statutory Auditors, M/s. S.R. Batliboi & Co, Chartered Accountants,
 hold office up to the next Annual General Meeting. The Board recommends
 their reappointment.
 
 J. MANAGEMENTS DISCUSSION AND ANALYSIS REPORT Managements Discussion
 and Analysis Report for the year under review, as stipulated under
 Clause 49 of the Listing Agreement with the Stock Exchanges in India,
 is presented in a separate section forming part of the Annual Report.
 
 K. CORPORATE GOVERNANCE
 
 The Company is committed to maintaining the highest standards of
 corporate governance and adhering to the corporate governance
 requirements as set out by SEBI.
 
 The report on corporate governance as stipulated under Clause 49 of the
 Listing Agreement forms part of the Annual Report.
 
 The certificate from the auditors of the Company confirming compliance
 with the conditions of corporate governance as stipulated under Clause
 49, is attached to this report.
 
 L. OTHERS
 
 L.1 PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION
 AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
 
 The particulars regarding foreign exchange earnings and expenditure
 appear at Item No. 8 and 9 in the notes to the Accounts. Since the
 Company does not own any manufacturing facility, the other particulars
 relating to conservation of energy and technology absorption stipulated
 in the Companies (Disclosure of Particulars in the Report of the Board
 of Directors) Rules, 1988 are not applicable.
 
 L.2. DIRECTORS RESPONSIBILITY STATEMENT AS REQUIRED UNDER THE
 PROVISIONS CONTAINED IN SECTION 217(2AA) OF THE COMPANIES ACT, 1956
 
 Your Directors hereby confirm that:
 
 (i) In the preparation of the annual accounts, the applicable
 accounting standards have been followed.
 
 (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 the state 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) 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.
 
 (iv) The Directors have prepared the annual accounts on a going concern
 basis.
 
 Employees Stock Option Scheme
 
 The shareholders of the Company by postal ballot on February 4, 2011
 approved the Employees Stock Option Scheme for employees and Whole-time
 Directors of CRISIL and its subsidiaries.
 
 The details of the options granted under the scheme are annexed to the
 report.
 
 Acknowledgements
 
 The Board of Directors wishes to thank the employees of CRISIL for
 their exemplary dedication and the excellence they have displayed in
 conducting the operations of CRISIL.  The Board also wishes to place on
 record its sincere appreciation of the faith reposed in the
 professional integrity of CRISIL by customers and investors who have
 patronised its services. The Board acknowledges the splendid support
 provided by market intermediaries. The affiliation with Standard and
 Poors has been a source of great strength.  The Board of Directors
 also wishes to place on record its gratitude for the faith reposed in
 CRISIL by the Securities and Exchange Board of India, the Reserve Bank
 of India, the Government of India, and the state governments. The role
 played by the media in highlighting the good work done by CRISIL is
 deeply appreciated.
 
                                  On behalf of the Board of Directors,
 
                                                  Douglas L Peterson
 
                                                           Chairman
 
                                          Mumbai, February 17, 2012
 
 MANAGEMENT DISCUSSION AND ANALYSIS REPORT
 
 J CRISIL BUSINESS