To the Members of Essar Securities Limited,
 
 The Directors have pleasure in presenting the Seventh Annual Report
 and Audited Accounts of the Company for the financial year ended March
 31, 2012.
 
 1.  FINANCIAL RESULTS, BUSINESS AND MANAGEMENT''S DISCUSSION &
 ANALYSIS:
 
                                                       (Rs. In Lakhs)
 
 Particulars                                    For the     For the
                                                year ended  year ended 
                                                on March    on March 
                                                31,2012     31,2011
 
 Income                                                 -      3339.85
 
 Less: Expenditure                                  18.62        39.69
 
 Profit Before Tax                                 (18.62)     3300.16
 
 Less: Provision for taxation                        4.85       692.03
 
 Profit After Tax                                  (23.47)     2608.13
 
 Dividend declared                                      -      (214.32)
 
 Corporate dividend tax                                 -       (34.77)
 
 Transfer to General Reserve                            -      (131.00)
 
 Balance brought forward from                     2254.32        26.28
 previous year
 
 Balance carried forward to                       2230.85      2254.32
 Balance Sheet
 
 DIVIDEND:
 
 During the year under review, the loss after tax was Rs. 23.47 Lakh
 against the profit after tax of Rs. 26.08 Crore for the previous year.
 The loss was mainly due to Administrative Expenses.
 
 The directors do not recommend any dividend due to the losses incurred
 during the year.
 
 Threats, Risks and Concerns
 
 As the Company has major equity investment in Essar Steel India
 Limited, a company engaged in Steel Business, its operations would also
 have a bearing on the performance of the Company.
 
 Internal Control Systems and Internal Audit
 
 Your Company has in-built internal control systems commensurate with
 the size and nature of operations of the Company. The financial
 statements would be reviewed periodically by the management. The
 Company has an internal audit system whereby deviations, if any, can be
 brought to the notice of the management quickly and remedial actions
 can be initiated immediately.
 
 2.  DIRECTORS:
 
 Mr. V. G. Raghavan and Mr. S. M. Lodha continue to be director of your
 Company. Mr. Dhanpat Singh Nahata, Mr. Neeraj Gupta and Mr. N. B. Vyas
 were inducted on the Board as Additional Director at the Meeting of
 Board of Directors held on February 14, 2012, May 14, 2012 and August
 24, 2012 respectively. Your company has received a letter from
 shareholders'' nominating them for the post of Director of the Company
 liable to retire by rotation. Mr. V. G. Raghavan retires by rotation at
 the ensuing Annual General Meeting (AGM) and being eligible offers
 himself for re-appointment.
 
 Mr. Vikas Saraf resigned from the directorship of the Company w.e.f.
 April 28, 2012. The Board wishes to place on record their sincere
 appreciation for the valuable sen/ices rendered by Mr.  Vikash Saraf
 during their tenure as a Director of the Company.  Mr. Girish Sathe
 also resigned as Manager of the Company within the meaning of section
 2(24) of the Companies Act, 1956 as well as from the post of Company
 Secretary w.e.f. May 14, 2012.
 
 Mr. Ashish Vyas, Company Secretary was appointed as Manager of the
 Company within the meaning of section 2(24) of the Companies Act in
 accordance with section 269 read with Schedule XIII of the Companies
 Act. Necessary resolution for approval of shareholders with respect to
 his appointment as Manager also forms part of the notice of the
 ensuring AGM.
 
 3.  DIRECTORS'' RESPONSIBILITY STATEMENT:
 
 Pursuant to the requirement of Section 217(2AA) of the Companies Act,
 1956, it is hereby confirmed:
 
 (i) that in the preparation of the annual accounts for the financial
 year ended 31st March, 2012, the applicable accounting standards had
 been followed along with proper explanation relating to material
 departures, wherever applicable;
 
 (ii) that the directors had 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 affairs of the Company at the end of the financial year and of the
 profit of the Company for the year under review;
 
 (iii) that the directors had 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;
 
 (iv) that the directors had prepared the accounts for the financial
 year ended 31 st March, 2012 on a going concern basis.
 
 4.  PUBLIC DEPOSIT:
 
 The Company has neither invited nor accepted any deposits from the
 public during the year. There are no unclaimed deposit(s) lying with
 the Company as on March 31, 2012.
 
 5.  AUDITORS:
 
 M/s. Nisar & Kumar, Chartered Accountants, Statutory Auditors of the
 Company, hold office till the conclusion of the ensuing Annual General
 Meeting of the Company. The Company has received confirmation to the
 effect that their appointment, if made, would be within the limits
 prescribed under Section 224(1 B) of the Companies Act, 1956.
 Accordingly, the members'' approval is being sought to their
 appointment as the Auditors of the Company at the ensuing Annual
 General Meeting.
 
 6.  PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY,
 ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
 
 Considering the nature of activities of your Company, the information
 required under Section 217(1)(e) of the Companies Act, 1956 read with
 Companies (Disclosure of Particulars in the Report of Board of
 Directors), Rules 1988 relating to Energy Conservation, Technology
 Absorption is not applicable. The Company had no foreign exchange
 earnings or outgo during the period under review.
 
 7.  PARTICULARS OF EMPLOYEES:
 
 The disclosure as required under Section 217(2A) of the Companies Act,
 1956 read with Companies (Particulars of Employees) Rules, 1975 as
 amended, is not required as there are no employees covered by it.
 
 8.  HOLDING COMPANY:
 
 Essar Capital Limited continues to be holding company of your Company.
 Essar Capital Holdings (India) Limited continues to be the ultimate
 holding company.
 
 9.  CORPORATE GOVERNANCE REPORT:
 
 The Company is committed to maintain the highest standard of Corporate
 Governance and comply to the Corporate Governance requirements as
 required under the Listing Agreement entered with the Stock Exchange.
 The disclosures as required in Clause 49 of the Listing Agreement have
 been furnished in the Annexure to the Directors'' Report under the head
 Corporate Governance.  The requisite Certificate from the
 Statutory Auditors of the Company confirming the compliances with the
 conditions of the Corporate Governance as stipulated in Clause 49 of
 the Listing Agreement entered with the Stock Exchanges, is attached and
 forming part of this Annual Report.
 
 10.  CAUTIONARY STATEMENT
 
 Estimation & expectation made in the report may differ from actual
 performance due to various economic conditions, Government policies and
 other related factors.
 
 11.  ACKNOWLEDGEMENT
 
 Your directors also wish to place on record their gratitude for the
 co-operation and assistance received from banks, stock exchange,
 shareholders and various departments of Central and State Governments
 and thank them for their continued co- operation and support.
 
                                 For and on behalf of the Board
 
                                V. G. Raghavan    Dhanpat Singh Nahata
                                Director                      Director
 
 Place: Mumbai 
 
 Date: August 24, 2012