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Hotel Leela Venture Directors Report, Hotel Leela Reports by Directors
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Hotel Leela Venture
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Download Annual Report PDF Format 2012 | 2011 | 2010
Directors Report Year End : Mar '12    « Mar 11
The Directors hereby present the thirty first Annual Report of the
 Company together with its Audited Statement of Accounts for the year
 ended 31st March, 2012.
 
 1.  Financial Results
 
 The Company''s performance during the year under review is summarized
 below:
 
                                                      (Rupees in Lakhs) 
                                        Financial Year   Financial Year
                                               2011-12          2010-11
 
 Revenue from Operations and Other            58,766.13       49,100.13
 
 Income
 
 Operating and other Expenses                 55,248.68       33,415.18
 
 Interest                                     32,125.06        5,608.31
 
 Depreciation                                 10,223.53        6,295.92
 
 Profit from discontinuing 
 operations &                                 41,766.36        1,854.12 
 gain on
 disposal of assets relating to 
 discontinuing operations
 
 Profit before Tax                             2,935.22        5,634.84
 
 Provision for Taxes / Deferred Tax            1,072.05        5.634.84
 
 Profit after Tax for the year                 1,863.17        3,783.85
 
 Balance brought forward                      32,588.18       31,280.44
 
 Amount available for Appropriation           34,451.35       35,064.29 
 Appropriations:
 
 Dividend on Equity shares                        -              581.74
 
 Tax on proposed Dividend                         -               94.37
 
 Transfer to General Reserve                      -                 -
 
 Transfer to Debenture Redemption              1,800.00        1,800.00
 
 Reserve
 
 Balance carried to Balance Sheet             32,651.35       32,588.18
 
 EPS Basic (in Rs.)                                0.48            0.99
 
 EPS diluted (in Rs.)                              0.48            0.93
 
 2.  Dividend
 
 In the absence of adequate profits and cash flows, the directors do not
 recommend any dividend for the financial year ended 31st March, 2012.
 During the year under review, the Company has credited Rs.13.7 lakhs,
 lying in the unpaid / unclaimed dividend and redemption account of
 debentures, to the Investor Education and Protection Fund (IEPF)
 pursuant to Section 205C of the Companies Act, 1956 read with the
 Investor Education and Protection Fund (Awareness and Protection of
 Investors) Rules, 2001.
 
 3.  Corporate Debt Restructuring
 
 The Company has applied for restructuring of its debts under the
 Corporate Debt Restructuring (CDR) mechanism. Please refer to the
 Management Discussions and Analysis for further details.
 
 4.  Foreign Currency Convertible Bonds
 
 As on 31st March, 2012, the Company had outstanding US Dollar Foreign
 Currency Convertible Bonds of the face value of US$ 41.60 million, due
 for redemption on 25th April, 2012. The bonds have been redeemed on
 25th May, 2012 along with redemption premium and interest for the
 delayed period.
 
 5.  Transfer of Kovalam Hotel Undertaking
 
 The Company has sold its Kovalam Hotel undertaking for Rs.50,000 Lakhs
 by way of a slump sale through a Scheme of Arrangement sanctioned by
 the Hon''ble Bombay High Court vide its Order dated 24th February, 2012.
 The Company has entered into a long term management contract with the
 new owner of the said hotel for managing the hotel under The Leela
 brand name.  The scheme became effective on 21st March 2012 with 1st
 September, 2011 as the Appointed Date.
 
 6.  Expansion / Up-gradation Plans
 
 Your Company owns and operates five hotels at New Delhi, Mumbai,
 Bangalore, Goa, and Udaipur, besides operating two hotels at Gurgaon
 and Kovalam under Management Contract. The Company expects to start
 operations of the hotel under construction in Chennai during the
 current financial year. During the financial year ended 31st March,
 2012, the Company added 20 guest rooms at its Goa hotel property,
 resulting an increase of total room inventory to 1890 including those
 under Management.
 
 The Company, through its subsidiary / associates, has acquired land in
 Agra for a hotel facing the Taj Mahal and in Lake Ashamed, Kerala for
 a backwater resort.
 
 The Company had purchased about 4.21 acres of land in Pune and 3.85
 acres of land in Hyderabad for building hotels in these locations.
 Since then, considerable capacity addition has taken place in these
 cities. Therefore, the Company has decided to use the land in Pune for
 high end residential use and has entered into joint development
 agreement with a reputed builder in Pune. In Hyderabad, the Company is
 planning an outright sale of land. The Company also has about 2 acres
 of land next to The Leela Palace, Bangalore and the Company has entered
 into a joint development agreement with a reputed builder for
 developing high-end Serviced Residences.
 
 7.  Management Discussion and Analysis (MDA)
 
 As required by Clause 49 of the Listing Agreements with the Stock
 Exchanges, Management Discussion and Analysis Report is appended
 herewith and forms an integral part of this report.
 
 8.  Corporate Governance
 
 As required by Clause 49 of the Listing Agreements, a separate section
 containing the Report on Corporate Governance together with the
 Certificate on the compliance with the conditions of corporate
 governance issued by a Practicing Company Secretary are appended hereto
 and they form part of this Annual Report.
 
 As part of good Corporate Governance, the Company has voluntarily
 obtained Secretarial Compliance Certificate from a Practising Company
 Secretary in respect of compliance of all rules and regulations under
 the various applicable provisions of the Companies Act, 1956 and the
 applicable regulations under the Listing Agreement entered into with
 the Stock Exchanges. A copy of the said certificate is appended
 elsewhere in this report.
 
 9.  Changes in Directorate
 
 Mr. P. C. D. Nambiar passed away on 27th May, 2012. The Board wish to
 place on record the valuable contribution made by Mr. Nambiar to the
 Company and to the deliberations of the Board and its Committees. The
 Board has decided not to fill the vacancy caused by his death for the
 time being.  Pursuant to the provisions of Section 260 of the Companies
 Act, 1956, the Board of Directors at their meeting held on 21st
 December, 2011 appointed Mr. M. Madhavan Nambiar as an additional
 Director and Mr. Pawan Kumar Nagpal as a nominee director of Airports
 Authority of India. Mr. Nambiar and Mr. Nagpal hold office up to the
 date of the forthcoming Annual General Meeting. The Company has
 received notices in writing under Section 257 of the Companies Act,
 1956 proposing their candidature for the office of director. A brief
 resume of the said directors is given in the explanatory statement. The
 Board commends their appointments by the members at the forthcoming
 Annual General Meeting.
 
 In accordance with the provisions of the Companies Act, 1956 and the
 Articles of association of the Company, Mr. C. K. Kutty, Mr. R.
 Venkatachalam, Mrs. Madhu Nair and Mr. Anil Harish retire by rotation
 at the forthcoming Annual General Meeting.
 
 Mr. C. K. Kutty and Mr. R. Venkatachalam, who retire by rotation, have
 conveyed that they are not seeking re-appointment at the ensuing Annual
 General Meeting. The Board has decided not to fill these vacancies. The
 Board wish to place on record their appreciation of the valuable
 contribution made by them.
 
 Mrs. Madhu Nair and Mr. Anil Harish, retiring by rotation at the
 forthcoming Annual General Meeting and being eligible, offer themselves
 for reappointment.
 
 None of the directors of the Company are disqualified from being
 appointed / re-appointed as directors as specified in section 274(1)(g)
 of the Companies Act, 1956, as amended.
 
 10.  Auditors
 
 M/s. Picardo & Co., Chartered Accountants, Statutory Auditors of the
 Company, retire at the ensuing Annual General Meeting. They have
 confirmed their eligibility and willingness for re-appointment. The
 Company has received a certificate from the Statutory auditors to the
 effect that their re-appointment, if made, would be within the limits
 prescribed under section 224(1B) of the Companies Act, 1956.
 
 The Board commends their re-appointment as statutory auditors.
 
 11.  Particulars of Employees
 
 As required by the provisions of Section 217(2A) of the Companies Act,
 1956, read with Companies (Particulars of Employees) Rules, 1975, as
 amended, the names and other particulars of the employees are set out
 in the Annexure to the Directors'' Report.
 
 12.  Subsidiary Companies and Consolidated Financial Statements
 
 The Company has not attached Balance Sheet, Profit and Loss Account and
 other documents of its two subsidiary companies with the Annual Report
 of the Company in terms of general exemption notified by the Ministry
 of Corporate Affairs, Government of India vide General Circular
 No.2/2011 dated 8th February, 2011 regarding compliance with Section
 212(8) of the Companies Act, 1956.
 
 The Company will make available these documents upon request by any
 member of the Company interested in obtaining the same. Further, these
 documents will also be available at the Registered Office of the
 Company for inspection by any member of the Company. As required under
 the aforesaid circular, a summarized statement of financial position of
 the subsidiaries has been appended to this Annual Report.
 
 The Consolidated Accounts, prepared in accordance with the Accounting
 Standard 21 and Clause 32 of the Listing Agreement form part of this
 Annual Report.
 
 13.  Fixed Deposits
 
 The Company has not accepted any deposits from the Public or from the
 shareholders.
 
 14.  Directors'' Responsibility Statement
 
 Pursuant to the provisions of Section 217(2AA) of the Companies Act,
 1956, the Directors hereby confirm that:
 
 (a) in the preparation of the annual accounts, the applicable
 accounting standards have been followed and there are no material
 departures from the same;
 
 (b) the Directors had 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 as on 31st March, 2012 and of the profit of the Company
 for the year;
 
 (c) they have 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; and
 
 (d) they have prepared the annual accounts on a going concern
 basis''.
 
 15.  Additional information in accordance with the provisions of
 Section 217(1)
 
 (e) of The Companies Act, 1956 read with the Companies (Disclosure of
 Particulars in the Report of the Board of Directors) Rules, 1988
 
 (a) Conservation of Energy and Water:
 
 Energy Conservation, sustainability and efforts to make the properties
 more Green have been the main drive for the Leela Group
 throughout the year. Major steps have been taken towards this. Some of
 the efforts are:
 
 - LED Lamps, CFL and energy saving lights have been used across all
 hotel properties.
 
 - Rain Water Harvesting has been implemented at Mumbai, Delhi and
 Kovalam hotels. The Leela Palace, Chennai will collect water on a major
 scale from rain water harvesting.
 
 - Sewage Treatment Plants in all properties are being used
 extensively to treat and recycle all sewage and grey water for reuse
 within the property.
 
 - Extensive retrofitting is being done on HVAC plants in all
 properties to reduce power consumption, in addition to installation of
 VFD and variable pumping system, resulting in savings in power
 consumption.
 
 - Computerized Power Monitoring is being implemented in all
 properties on a gradual basis to monitor and control power consumption.
 
 - Old equipments are being replaced with more efficient ones to
 reduce power consumption and improve efficiency.
 
 - Main chiller and steam boilers have been tuned for best efficiency
 to conserve energy.
 
 - Hotels are equipped with building management system to monitor and
 control energy wastage of engineering equipments.
 
 - Power distribution systems are equipped with power factor
 correction panels and automatic voltage regulators.
 
 - Delhi hotel is equipped with solar geysers for generating hot water
 and the rooms are equipped with energy saving devices during
 non-occupancy.
 
 - Wind Mills continue to produce Renewable Energy for use in two of
 the hotels.
 
 (b) Technology Absorption:
 
 In the opinion of the Board, the required particulars, pertaining to
 technology absorption in terms of Rule 2 of the Companies (Disclosure
 of Particulars in the Report of Board of Directors) Rules, 1988 are not
 applicable, as the hotel is service industry and the Company does not
 have any significant manufacturing operations.
 
 (c) Foreign Exchange Earnings and Outgo:
 
 The foreign exchange earnings of the Company during the year stood at
 Rs. 19,436 lakhs (previous year Rs. 17,388 lakhs) and foreign exchange
 outgo during the year stood at Rs. 4,658 lakhs (previous year Rs. 3,034
 lakhs).
 
 16.  Acknowledgements
 
 The Board wishes to place on record its appreciation for the assistance
 and support received from the lenders, Government authorities,
 customers and vendors.
 
 Your directors take this opportunity to express their sincere thanks to
 all the investors, shareholders and stakeholders for the faith and
 confidence they have reposed in the Company and the management.
 
 Your directors attribute immense importance to the contribution of the
 family of staff and sincerely thank the Leela Team for sharing the
 Company''s vision and philosophy and for the dedication and commitment
 in ensuring that we remain in the forefront of our competitive industry
 as one of the finest Hotel Groups in India.
 
                             For and on behalf of the Board of Directors
 
                                               Capt. C. P. Krishnan Nair 
 
                                                                Chairman
 
 Mumbai, 29th May, 2012
Source : Dion Global Solutions Limited
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