Dear Members,
 The Directors have pleasure in presenting their 89th Annual Report
 together with the Audited Accounts of the Company for the year ended
 31st March, 2011.
 
 1.  FINANCIAL PERFORMANCE:
 
                                                    (Rs. in Crores)
 
 Particulars                             Standalone       Consolidated
 
                                  2010-11   2009-10   2010-11   2009-10
 
 Profit before Depreciation & 
 Interest                          280.70    421.84    557.23    752.61
 
 Less :
 
 Depreciation                       91.71     70.93    241.23    198.11
 
 Interest                           12.31    139.66     47.10    386.89
 
 Profit Before Tax                  176.68    211.25    268.90    167.61
 
 Less :
 
 Provision for Taxation             58.23     85.54    150.39    114.97
 
 Profit After Taxation              118.45    125.71    118.51     52.64
 
 Transferred to Minority Interest       —         —     (4.03)     4.03
 
 Additional Tax Provision               —         —         —         —
 
 Short/(Excess) Provision of 
 Taxes of Earlier Period                —         —         —         —
 
 Prior Period Adjustments               —         —     (4.45)     2.91
 
 Profit for the year                118.45    125.71    110.03     45.70
 
 Add :
 
 Profit brought forward from 
 the previous year                 273.36    231.43     40.94     70.32
 
 Available for Appropriation       391.81    357.14    150.97    116.02
 
 Appropriations :
 
 Transfer to General Reserve        12.00     29.75      32.21    29.75
 
 Transfer to Debenture 
 Redemption Reserve                 45.50     38.38      45.50    38.38
 
 Transfer from Debenture 
 Redemption Reserve                (19.15)        —     (19.16)       —
 
 Dividend from Own Shares           (0.58)    (0.35)     (0.58)   (0.35)
 
 Transfer from Foreign 
 Project Reserve                        —         —       6.06        —
 
 Transfer to Foreign Currency 
 Translation Reserve                    —         —       0.99    (9.01)
 
 Adjustments to Minority Interest       —         —       3.42     0.31
 
 Dividend (Interim/Proposed) 
 Equity Shares                      10.63      7.65      10.63     7.65
 
 Dividend (Proposed) Preference 
 Shares                                 —      6.07          —     6.07
 
 Tax on Dividend                     1.74      2.28       7.52     2.28
 
 Balance carried to Balance Sheet  341.67    273.36      64.37    40.94
 
 The Turnover of the Company on a standalone basis stood at Rs. 5,637
 Crores for the year ended 31st March, 2011. The annualised percentage
 increase in turnover over previous year amounted to 24.33%. The order
 book position of your Company as on 31st March, 2011 was approximately
 Rs. 15,600 Crores.
 
 On a consolidated basis the turnover of the Gammon group stood at Rs.
 8,899.70 Crores for the year ended 31st March, 2011.  The annualised
 percentage increase in turnover over previous year amounted to 25.11%.
 
 2.  DIVIDEND:
 
 (a) The Board of Directors at its meeting held on 18th August, 2010,
 had declared an interim dividend of Rs. 0.40 paise (20%) per share of
 face value of Rs. 2/- each on the equity shares for the financial year
 2010-11. The same was paid to the shareholders on 4th September, 2010.
 Members are requested to confrm the declaration and payment of the
 interim dividend at the Annual General Meeting of the Company.
 
 (b) The Board of Directors at its meeting held on 12th August, 2011
 has, subject to the Shareholder''s approval, recommended a Final
 dividend of Rs. 0.40 paise (20%) per share of face value of Rs. 2/-
 each for the year 2011 on the equity shares. The total dividend for the
 financial year 2010-2011 (including interim dividend of 20% paid)
 aggregates to Rs. 0.80 paise (40%) per share. The dividend payout for
 the year under review is Rs. 10.63 Crores.  Dividend Distribution Tax
 aggregates to Rs. 1.74 Crores.
 
 3.  DEPOSITORY SYSTEM:
 
 The Company''s equity shares are compulsorily tradeable in electronic
 form. As of 31st March, 2011, 90.90% of the Company''s total paid-up
 capital representing 124,046,624 equity shares is in dematerialized
 form. In view of the benefts offered by the depository system, members
 holding shares in physical mode are advised to avail the demat
 facility.
 
 4.  FINANCE:
 
 During the year under review the Company did not raise any funds from
 the capital markets either by way of issue of equity/ADRs/GDRs. The
 Company in its Board Meeting held on 9th July, 2009 had allotted
 1,60,00,000 Equity Warrants convertible into Equity Shares (after
 receipt of 25% consideration as upfront payment at the time of
 allotment) to the Promoter Companies at a price of Rs. 90.20/- per
 warrant. During the year under review, the Promoter Companies exercised
 their option for conversion of balance 82,50,000 Equity Warrants into
 Equity Shares by paying balance 75% of the consideration aggregating to
 Rs. 55.81 Crores. These proceeds were utilized for meeting the working
 capital requirements, future expansion plans and CAPEX requirements.
 
 The Company has also obtained financial assistance from its consortium
 bankers to meet its short term working capital requirements. During the
 year, the Company tied up Long term debt by way of issue of Secured
 Non-Convertible Debentures on private placement basis aggregating to
 Rs. 100 Crores. The total amount of outstanding Non-Convertible
 Debentures as on date is Rs. 377.50 Crores. The proceeds of debentures
 were utilized for the purposes for which they were raised.
 
 CARE has assigned the following ratings:
 
 Facilities                            Amount        Ratings
                               (Rs. in Crores) 
 
 Long Term Bank Facilities          1,100.00       CARE AA- 
 
 Long/Short Term Bank Facilities   10,400.00       CARE AA-/CARE A1  
 
 Non-Convertible Debentures           500.00       CARE AA- 
 
 CP/STD                               100.00       CARE A1  
 
 CP/STD*                              900.00       CARE A1  
 
 * Carved out of working capital limits
 
 5.  PUBLIC DEPOSITS:
 
 Your Company did not invite or accept deposits from public during the
 year under review. 82 deposits (pertaining to previous year)
 aggregating to Rs. 790,000/- remained unclaimed as on 31st March, 2011.
 Out of these, 5 deposits amounting to Rs. 1,05,000/- have since been
 claimed and paid.
 
 6.  TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND:
 
 During the year under review, the Company has transferred Fixed
 Deposits amounting to Rs. 452,000/- and Dividend (for the year 2002-03)
 amounting to Rs. 212,876/- to Investor Education and Protection Fund
 (IEPF), which was due and payable and remained unclaimed and unpaid for
 a period of seven years, as provided in Section 205C(2), of the
 Companies Act, 1956.
 
 7.  EMPLOYEE STOCK OPTION SCHEME:
 
 The erstwhile Associated Transrail Structures Limited (ATSL) had
 introduced an Employee Stock Option Scheme for the beneft of its
 employees. Pursuant to the amalgamation of ATSL with the Company,
 effective from 7th July, 2009, the said scheme has been taken over by
 the Company. Details of the stock options granted under the Employee
 Stock
 
 Option Scheme-2007 of erstwhile ATSL are disclosed in compliance with
 Clause 12 of the Securities and Exchange Board of India (Employee Stock
 Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and
 set out in Annexure ''A'' of this Report.
 
 8.  SUBSIDIARY COMPANIES:
 
 At the commencement of the year the Company had 43 (Forty Three)
 subsidiaries. It has further incorporated/acquired the following
 subsidiaries/step down subsidiaries during the year under review:
 
 (i) SAE Transmission India Limited
 
 (ii) Franco Tosi Hydro Private Limited
 
 (iii) Franco Tosi Turbines Private Limited
 
 (iv) Metropolitan Infrahousing Private Limited
 
 (v) AnsaldoCaldaie Boilers India Private Limited
 
 (vi) Preeti Townships Private Limited
 
 (vii) Lilac Infraprojects Developers Limited
 
 (viii) Chitoor Infra Company Private Limited
 
 (ix) Chitoor Infrastructure Projects Private Limited (formerly known as
 Satyavedu Infra Company Private Limited)
 
 (x) Tada Infrastructure Projects Private Limited (formerly known as
 Tada SEZ Private Limited)
 
 (xi) Gammon Holdings (Mauritius) Limited.
 
 The Ministry of Corporate Affairs, Government of India has, vide
 General Circular No. 2/2011 dated 8th February 2011, granted exemption
 under Section 212(8) of the Companies Act, 1956, for not attaching
 Annual Report of subsidiary companies, subject to fulfillment of certain
 conditions by the holding company. Pursuant to the Circular, the Board
 vide its Resolution dated 12th May, 2011 has given its consent for not
 attaching the Balance Sheet of the subsidiary company. In view of the
 said circular, the Financial Statements of the subsidiary companies
 have not been attached to the Company''s accounts for the year ended
 31st March, 2011. The consolidated financial statements published by the
 Company include the financial results of its subsidiary companies.
 
 Information required to be provided in respect of subsidiary companies
 has been disclosed separately in the Annual report.
 
 The Financial Statements of the subsidiary companies are available for
 inspection by the shareholders at the registered office of the Company.
 Shareholders who wish to have a copy of the accounts of the
 subsidiaries will be provided the same on receipt of written request
 from them.
 
 9.  AUDITORS'' REPORT
 
 With reference to the Auditors'' observation in point no. 8 of their
 report on the Consolidated Financial Statements for the year ended 31st
 March, 2011, the management is of the opinion that the amount is
 contractually recoverable and the component company is in negotiations
 with its client and hence no provision is made towards the same.
 
 10.  AUDITORS:
 
 M/s. Natvarlal Vepari & Co., Chartered Accountants, Firm Registration
 no. 106971W, Statutory Auditors of the Company retire at the ensuing
 Annual General Meeting and are eligible for re-appointment. A
 certificate to the effect that their appointment, if made, will be
 within the prescribed limits u/s 224(1B) of the Companies Act, 1956 has
 been obtained from them.
 
 The Board on the recommendation of the Audit Committee, recommends the
 re-appointment of M/s. Natvarlal Vepari & Co., Chartered Accountants,
 Firm Registration no. 106971W as the Statutory Auditors of the Company
 and also as the Branch Auditors, Oman Branch and any other branch for
 the year 2011-12, subject to approval by the Shareholders.
 
 The Board also on the recommendation of the Audit Committee, recommends
 the re-appointment of M/s. Vinod Modi & Associates, Chartered
 Accountants, Firm Registration no. 111515W and M/s. M. G. Shah &
 Associates, Chartered Accountants, Firm Registration no. 112561W, as
 the Joint Branch Auditors of ''Gammon India Limited – Transmission
 Business Headquarters, Nagpur'' subject to approval by the Shareholders.
 
 11.  REPORT ON CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND
 ANALYSIS:
 
 Report on Corporate Governance and Management Discussion and Analysis
 Report for the year under review, together with a Certificate from the
 Auditors of the Company regarding compliance of the conditions of
 Corporate Governance, as stipulated under Clause 49 of the Listing
 Agreement forms part of the Annual Report.
 
 12.  CONSOLIDATED FINANCIAL STATEMENTS:
 
 Your Directors have pleasure in attaching the Consolidated Financial
 Statements pursuant to Clause 32 of the Listing Agreement entered into
 with the Stock Exchanges and prepared in accordance with the Accounting
 Standards prescribed by the Institute of Chartered Accountants of
 India, in this regard.
 
 13.  DIRECTORS:
 
 Dr. Naushad Forbes resigned as the Director of the Company with effect
 from 11th November, 2010. The Board places on record its sincere
 appreciation for the valuable contribution made by him during his
 tenure as a Director of the Company.
 
 Mr. Himanshu Parikh a Non Whole Time Director was appointed as a Whole
 Time Director of the Company with effect from 1st July, 2011.
 
 Mr. Abhijit Rajan, Chairman & Managing Director whose term ended on
 16th May, 2011 was re-appointed as the Chairman & Managing Director of
 the Company for a term of 5 (five) years with effect from 17th May,
 2011.
 
 Pursuant to the provisions of Section 256 of the Companies Act, 1956
 and the Articles of Association of the Company, Mr. C.C. Dayal, Mr.
 Naval Choudhary and Mr. Atul Kumar Shukla retire by rotation at the
 ensuing Annual General Meeting and being eligible, offer themselves for
 re-appointment. Brief profles of the proposed appointees together with
 other disclosures in terms of Clause 49 of the Listing Agreement are
 part of the Annexure to the Notice of the Annual General Meeting.
 
 14.  DIRECTORS'' RESPONSIBILITY STATEMENT:
 
 Pursuant to Section 217 (2AA) of the Companies (Amendment) Act, 2000,
 the Directors confrm that:
 
 1.  The applicable accounting standards have been followed by the
 Company in preparation of the annual accounts for the period ended 31st
 March, 2011;
 
 2.  The Directors have selected 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 as at 31st March, 2011 and of the Profits of the Company for
 the year ended on that date;
 
 3.  Proper and sufficient care has been taken 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;
 
 4.  The annual accounts for the year ended 31st March, 2011 have been
 prepared on a going concern basis.
 
 15.  HEALTH, SAFETY & ENVIRONMENT:
 
 We are committed as an organization to ensure that all our work
 practices and procedures emphasize on the importance of safety and are
 in the process of implementing various new safety measures. We want to
 inculcate and integrate a strong safety culture in all our operations.
 There are over 126 safety personnel on permanent rolls of the
 organization.  Over half our safety personnel are diploma holders and
 the next majority is engineers and post graduates.
 
 There are a lot of new processes and improvement of old processes that
 have been introduced in Gammon in the past year. One of the major
 changes has been to restructure and organize the reporting and
 functioning of the safety team.  This was done to ensure that there is
 greater responsibility given as a line function so as to enhance the
 performance of the team. Certain major processes like third party
 inspection of equipment, safety related deficiency (SRD) process at
 site, communication channels, training and awareness programs have also
 been modifed. It has been made mandatory for workers who are working at
 critical jobs, to undergo training before commencement of the job. A
 process of awards, recognitions and penalties has been intiated in the
 Company. Based on the safety performance, various types of recognitions
 and penalties shall be given to individual projects to encourage the
 practice of a strong pro-active positive safety culture.
 
 16.  RESEARCH & DEVELOPMENT:
 
 Increasing focus on developing infrastructure in the country has opened
 up many opportunities for construction companies. To rise up to the
 challenge of completing the huge quantum of work in a short time, it is
 essential to back up the onsite teams with continual improvement in
 construction technology. During the year under review the R&D
 activities undertaken by the company include:
 
 - Pile concrete with a retention time of 7 hours and having 15 MPa
 strength in 24 hours successfully designed and implemented in Mumbai
 Port Trust Project.
 
 - Considering the continuous scarcity of river sand in Mumbai region we
 have established mix designs with 100% crushed sand for all grades of
 concrete.
 
 - Trials for using raw slag as replacement of sand with compatible
 admixture are in progress.
 
 - Smart Dynamic Concrete mix designs established successfully for
 chimney shell for improving surface finish and faster construction.
 
 - Trial for smart dynamic concrete are in process as replacement of
 conventional concrete.
 
 - Structural Health monitoring device were successfully used in the
 launching girder which was designed after in-house R&D, at Kosi Bridge
 Project.
 
 - For Kalpakkam Intake Structure, the launching of caisson was done
 successfully in spite of rough sea conditions with two portals on
 strand jacks entirely designed and fabricated in house. It was a unique
 system being used for the frst time in India.
 
 17 PARTICULARS OF EMPLOYEES:
 
 The particulars of employees required to be furnished under Section
 217(2A) of the Companies Act, 1956, read with the Companies
 (Particulars of Employees) Rules, 1975, forms part of this Report.
 However, as per the provisions of Section 219(1)(b)(iv) of the
 Companies Act, 1956, the Report and Accounts are being sent to all
 shareholders, excluding the statement of particulars of employees. Any
 shareholder interested in obtaining a copy may write to the Company
 Secretary at the Registered Office of the Company.
 
 18.  PARTICULARS UNDER COMPANIES (DISCLOSURE OF PARTICULARS IN THE
 REPORT OF THE BOARD OF DIRECTORS) RULES, 1988:
 
 A.  Conservation of Energy:
 
 The Conservation of energy in all possible areas is undertaken as an
 important means of achieving cost reduction.  Savings in electricity,
 fuel and power consumption receive due attention of the management on a
 continuous basis and as a result, some new initiatives for energy
 management are being undertaken at sites as mentioned below:
 
 1.  Using portable transformers instead of running DG sets.
 
 2.  Using APFC Panel with grid power for improvement of PF value.
 
 3.  Using of CFL instead of incandescent lamp.
 
 4.  Incorporating float switch with pump.
 
 5.  Using grid power instead of DG at A-V during 7 months unproductive
 period.
 
 6.  Energy audit & control over redundant running.
 
 B.  Technology Absorption:
 
 Timely completion of the projects as well as meeting the budgetary
 requirements are the two critical areas where different techniques help
 to a great extent. Many innovative techniques have been developed and
 put to effective use and the efforts to develop new techniques continue
 unabated.
 
 C.  Foreign Exchange earnings and outgo:
 
 Total foreign exchange used and earned during the year:
 
                                         (Rs. in Crores)
 
                             Current Period Previous Period
 
 Foreign Exchange Earnings          153.58        301.03
 
 Foreign Exchange Outgo             170.91        145.63
 
 19.  ACKNOWLEDGMENTS:
 
 Your Directors thank all its valued customers and various Government,
 Semi-Government and Local Authorities, Suppliers and other Business
 associates. Your Directors appreciate continued support from Banks and
 Financial Institutions and look forward to their co-operation in the
 future.
 
 Your Directors place on record their appreciation of the dedicated
 efforts put in by the employees at all levels and wish to thank the
 Shareholders for their unstinted support and co-operation.
 
                         For and on behalf of the Board of Directors
 
                                                       ABHIJIT RAJAN
 
                                        Chairman & Managing Director 
 
 Place : Mumbai 
 
 Dated : 19th August, 2011