The Directors have pleasure in presenting the Seventeenth Annual
 Report along with the audited statements of accounts of your Company
 for the financial year ended March 31, 2012.
 
 I. Financial results
 
 A snapshot of the financial performance of the Company and its major
 subsidiaries for the financial year 2011-12 is as under:
 
                                                       (Rs.million)
 
 Name of 
 Company         Revenues      Profit before 
                               interest,          Profit after tax
                               depreciation 
                               and tax
 
 Aggregate        18,864.7       7,840.5              1,360.7
 
 India 
 Infoline Ltd      6,390.0       1,431.5                633.0
 
 India Infoline 
 Finance Ltd       9,103.7       6,195.4              1,018.5
 
 India Infoline 
 Housing 
 Finance Ltd         431.3         239.1                 35.9
 
 India Infoline 
 Insurance 
 Services Ltd         54.6          33.6                  1.6
 
 India Infoline 
 Insurance 
 Brokers Ltd         857.9          41.4                 26.5
 
 India Infoline 
 Commodities Ltd   1,031.9         110.3                 28.5
 
 India Infoline 
 Media and 
 Research 
 Services Ltd        424.6          79.8                 15.8
 
 IIFL Realty 
 Ltd                 574.6         449.2                (40.0)
 
 IIFL Wealth 
 Management Ltd    1,070.0         277.5                147.6
 
 India Infoline 
 Venture 
 Capital Fund         (0.5)        (43.2)               (43.8)
 
 IIFL Inc             70.3          (3.7)                 1.4
 
 India Infoline
 Asset Management 
 Company Ltd          10.4         (16.2)               (23.0)
 
 Finest Wealth 
 Managers 
 Private Ltd          24.4          13.6                  9.1
 
 IIFL Securities 
 Ceylon (Pvt) 
 Ltd                  26.3           5.5                  3.9
 
 IIFL Private 
 Wealth Dubai 
 Ltd                   1.5         (33.2)               (33.4)
 
 IIFL Private 
 Wealth 
 (Mauritius) Ltd      37.9           0.8                  0.7
 
 IIFL Wealth 
 (UK) Ltd             14.8          (1.4)                (1.4)
 
 IIFL (Asia) 
 Pte. Ltd              -          (268.6)              (178.0)
 
 IIFL Capital 
 Pte. Ltd             35.1         (35.5)               (39.2)
 
 IIFL Securities 
 Pte Ltd             215.5         (38.3)               (43.6)
 
 Inter Company 
 Adjustments      (1,525.8)       (591.2)              (143.6)
 
 Other 
 Subsidiaries         16.2          (5.9)               (15.7)
 
 A snapshot of the consolidated financial performance of your Company is
 as under:  
                                                          (Rs.million) 
 
                                            2011-12           2010-11
 
 Gross total income                        18,864.7          14,739.4
 
 Profit before interest, depreciation 
 and taxation                               7,840.5           6,067.5
 
 Interest and financial charges             5,043.1           2,357.9
 
 Depreciation                                 802.2             581.7
 
 Profit before tax                          1,995.2           3,127.9
 
 Taxation - Current                           835.2           1,073.6
 
 -    Deferred                               (207.9)           (127.7)
 
 -    Short or excess provision for 
 income tax                                     7.2              34.7
 
 Net profit for the year                    1,360.7           2,147.3
 
 Less: Exceptional item (net of tax)            -                 -
 
 Net profit before minority interest        1,360.7           2,147.3
 
 Less: Minority interest                      (40.0)            (35.9)
 
 Less: Appropriations
 Interim dividend                            (433.6)           (860.4)
 
 Dividend distribution tax                    (70.3)           (147.3)
 
 Transfer to general reserve                  (65.2)           (206.0)
 
 Transfer to special reserve                 (216.3)           (185.5)
 
 Debenture Redemption Reserve                (630.0)              -
 
 Adjustments for Minority Interest 
 and fair value                                69.7            (190.4)
 
 Add: Balance brought forward from 
 the previous year                          3,004.9           2,483.1
 
 Balance to be carried forward              2,979.9           3,004.9
 
 A snapshot of the standalone financial performance of your Company is
 as under: 
 
                                                          (Rs.million)
 
                                                2011-12        2010-11
 
 Gross total income                             6,390.0        7,995.5
 
 Profit before interest, depreciation 
 and taxation                                   1,440.2        2,834.9
 
 Interest and financial charges                   378.6          861.5
 
 Depreciation                                     314.4          240.8
 
 Profit before tax                                747.2        1,732.6
 
 Taxation - Current                               142.7          512.3
 
 -    Deferred                                    (29.1)         (10.9)
 
 -    Short or excess provision for income tax      0.6            7.6
 
 Net profit for the year                          633.0        1,223.6
 
 Less: Appropriations                               -              -
 
 Interim dividend                                 433.6          859.2
 
 Dividend distribution tax                         70.3          127.6
 
 Transfer to general reserve                       65.2          123.0
 
 Add: Balance brought forward from the
 previous year                                  1,737.2        1,623.4
 
 Balance to be carried forward                  1,801.1        1,737.2
 
 II.  Review of operations
 
 On a consolidated basis, in the current year, your Company''s income
 increased by 28% to Rs. 18.9 billion and EBIDTA increased by 29.2% to Rs.
 7.8 billion. However with higher interest outgo, Profit before tax
 declined by 36.2% and Profit after tax before minority interest
 decreased by 36.6% to Rs. 1.4 billion.
 
 Due to sluggish capital markets, equity broking and related income
 decreased by 18.5% to Rs. 5.5 billion. Our Credit and Finance business
 gained momentum and increased by 76.4% to Rs. 10.9 billion, contributing
 58% to total revenues, in the current year. Marketing and distribution
 income also grew by 31.9% to Rs. 2,430.7 million. The other income stood
 at Rs. 71.9 million.
 
 III. Key initiatives
 
 Maiden NCD issue by NBFC subsidiary
 
 During the year under review, India Infoline Finance Limited, the NBFC
 subsidiary, successfully completed Initial Public Offering of Secured
 Redeemable Non-Convertible Debentures (NCDs) of Rs. 3.75 billion with
 green shoe option to retain additional Rs. 3.75 billion. The issue
 received an overwhelming response and was oversubscribed and the
 Company could retain Rs. 7.5 billion subscription. These NCDs are listed
 and traded on the National Stock Exchange and Bombay Stock Exchange.
 
 Launch of IIFL Real Estate Fund
 
 India Infoline Venture Capital Fund (IIFL VCF), the venture capital arm
 of India Infoline Group (IIFL), successfully completed the launch of
 its Real Estate Fund - ''IIFL Real Estate Fund (Domestic) Series 1'' in
 January, 2012. The fund was fully subscribed with total commitment of Rs.
 5 billion with green shoe option of Rs. 2.5 billion. The fund is focused
 on the real estate sector in India by investing in equity, debt and
 equity-linked instruments of promising real estate development projects
 and companies involved in projects predominantly located in Tier-I
 cities which have significant growth potential.
 
 IIFL Mutual Fund
 
 Subsequent to SEBI approval to mutual fund business, IIFL Mutual Fund
 launched its first New Fund Offer IIFL Nifty ETF in September, 2011 and
 received an encouraging response from investors.  IIFL Nifty ETF ranked
 second in most traded Equity ETF''s on NSE and has a high level of
 retail investors of over 7,000. IIFL Mutual Fund also launched 3 series
 of debt schemes under IIFL Fixed Maturity Plan. The total net assets
 under management of IIFL Mutual Fund as on March 31, 2012 was Rs. 1,711.3
 million.
 
 New products introduced by IIFL Wealth Management IIFL Wealth
 Management introduced new products structured on the fixed income side
 including NCDs, NABARD,
 
 Structured Notes and Introduced Family Office, a multi- manager
 investment platform offering a complete wealth structuring solution and
 inter-generational transfer solution to clients. The total assets under
 wealth advisory crossed Rs. 200 billion during the year.
 
 Global operations
 
 During the year, the Company set up wholly owned subsidiaries in Hong
 Kong, Mauritius and Dubai to undertake financial advisory and
 distribution services.
 
 Global investor conference
 
 Your Company''s institutional research products have been well
 appreciated by the target audience. Enterprising India- III, your
 Company''s third Global Investors Conference, held in February, 2012 at
 Mumbai had participation from leading corporates and eminent leaders /
 speakers. The Conference received an overwhelming response from global
 investors and institutional participants.
 
 Corporate Social Initiative - Financial Literacy
 
 As a part of its Corporate Social Responsibility initiative, your
 Company launched a comprehensive financial education and awareness
 initiative, FLAME - Financial Literacy Agenda for Mass Empowerment, in
 2011.
 
 Under this initiative your Company has successfully completed over 250
 FLAME workshops for investors and students. Over 45 schools covering
 5,500 students have enrolled for the Fin-Lites distance learning
 programme.
 
 Our other initiatives include a comprehensive mass media campaign on
 financial literacy, dedicated portal and helpline and effective use of
 social media platforms like Twitter and Facebook to answer queries and
 books and publications.
 
 Corporate Social Initiative - Helping the underprivileged and
 physically handicapped
 
 IIFL sponsored Swadhaar Finaccess (SFA), an NGO to impart financial
 education to women living in slum communities through a specially
 designed Financial Education Programme (FEP).
 
 IIFL has also tied up with KJ Somaiya Institute of Management Studies &
 Research (SIMSR) to impart basic financial knowledge to underprivileged
 sections and physically handicapped sections of the society. The
 programmes covers lessons on savings, budgeting, banking, credit
 management, microfinance and self-help groups (SHGs).
 
 Awards and Recognitions:
 
 Your Company was conferred the following awards during 2011-12:
 
 - Best Broking House with Global Presence'' awarded by D&B Equity
 Broking Awards 2011
 
 - Awarded ''Best Broker - India'' by Finance Asia Country Awards for
 Achievement 2011
 
 - IIFL''s Wealth Management subsidiary bagged Euro money awards for Best
 Fixed Income Portfolio Management &
 
 Best Commodities Investment in India 2012 and ''Best Wealth Management
 House - India'' by The Asset Triple A 2011
 
 IV.  Merger of subsidiary
 
 India Infoline Marketing Services Limited (IIMSL), a wholly- owned
 subsidiary was merged with the Company with effect from April 1, 2011.
 The Scheme of Amalgamation was sanctioned by the Hon''ble High Court of
 Judicature at Bombay vide order dated April 27, 2012. Pursuant to the
 Scheme, the Authorised Share Capital of the Company increased to Rs. 1200
 million. Similarly, Moneyline Credit Limited, step down NBFC subsidiary
 was merged with, India Infoline Finance Limited, direct NBFC
 subsidiary. This enabled consolidation of all lending and investments
 businesses (except housing loans) under one NBFC subsidiary and ensures
 better operations and control.
 
 V.  Dividend on equity shares
 
 During 2011-12, the Company declared and paid an interim dividend of Rs.
 1.5 per share (face value of Rs. 2 per share). The same is considered as
 final. The total dividend paid in 2010- 11 was Rs. 3 per share.
 
 VI.  Allotment of shares
 
 During 2011-12, your Company allotted 2,613,380 equity shares of Rs. 2
 each on exercise of stock options under the Employee Stock Option
 Schemes of the Company.
 
 VII. Deposits
 
 During 2011-12, your Company did not accept / renew any deposits within
 the meaning of Section 58A of the Companies Act, 1956 and the rules
 made there under and as such, no amount of principal or interest was
 outstanding as on the balance sheet date.
 
 VIII.  Subsidiary companies
 
 As on March 31, 2012, the Company has 29 subsidiaries located in India
 and overseas. Pursuant to the general exemption granted by the Ministry
 of Corporate Affairs vide circular dated February 8, 2011, the Board of
 Directors had at their meeting held on May 15, 2012 approved attaching
 the consolidated financials of all the subsidiaries of the Company
 along with that of the Company. The copies of the Balance Sheet, Profit
 and Loss Account, Report of the Board of Directors and Report of the
 Auditors of each of the subsidiary companies are not attached to the
 accounts of the Company for financial year 2011-12. Your Company will
 make available these documents / details upon request by any member of
 the Company. These documents / details will also be available for
 inspection by any member of the Company at its registered office and
 also at the registered offices of the concerned subsidiaries. The
 Annual Report of all the subsidiaries shall be uploaded upon the
 website of the Company. As required by Accounting Standard - 21 (AS-21)
 issued by the Institute of Chartered Accountants of India, the
 Company''s consolidated financial statements included in this Annual
 Report incorporates the accounts of its subsidiaries. A summary of key
 financials of the Company''s subsidiaries is also included in this
 Annual Report.
 
 IX.  Management Discussion and Analysis
 
 The Management Discussion and Analysis Report for 2011- 12, as required
 under Clause 49 of the Listing Agreement is given as a separate
 statement in the Annual Report.
 
 X.  Disclosure of Employee Stock Options
 
 During 2011-12, the Company granted 5,200,000 stock options to the
 employees under its Employee Stock Option Scheme 2007 and 2008. Details
 as per the Securities and Exchange Board of India (Employees Stock
 Option Scheme and Employee Stock Option Purchase Scheme) Guidelines,
 1999, are attached as an annexure.
 
 XI.  Directors
 
 In accordance with Sections 255 and 256 of the Companies Act of 1956
 read with Article 137 of the Articles of Association of the Company,
 Mr. Nilesh Vikamsey, retires by rotation and being eligible, offers
 himself for reappointment at the ensuing Annual General Meeting of the
 Company.
 
 Mr. Sunil Kaul has been appointed as an Additional Director of the
 Company by the Board with effect from November 5, 2011.  As per the
 provisions of Section 260 of the Companies Act, 1956, (Act), Mr. Kaul
 holds the position till the date of the forthcoming Annual General
 Meeting of the Company.  The Company has received notice in writing
 from a member under Section 257 of the Act, proposing appointment of
 Mr. Kaul as a Director of the Company.
 
 Mr. Chandran Ratnaswami has been appointed as an Additional Director of
 the Company by the Board with effect from May 15, 2012. As per the
 provisions of Section 260 of the Companies Act, 1956, (Act), Mr.
 Chandran holds the position till the date of the forthcoming Annual
 General Meeting of the Company. The Company has received notice in
 writing from a member under Section 257 of the Act, proposing
 appointment of Mr. Chandran as a Director of the Company.
 
 The proposals for appointment of Mr. Sunil Kaul and Mr. Chandran
 Ratnaswami as Directors of the Company are recommended for shareholders
 approval.
 
 XII. Directors'' Responsibility Statement
 
 As required by Section 217 (2AA) of the Companies Act, 1956, your
 Directors confirm that:
 
 (a) In the preparation of the annual accounts, the applicable
 accounting standards were followed
 
 (b)Appropriate accounting policies were selected and applied
 consistently and that judgments and estimates made were reasonable and
 prudent so as to give a true and fair view of the state of affairs of
 your Company as at March 31, 2012, and of its profit for the year ended
 on that date
 
 (c) Proper and sufficient care was taken to maintain adequate
 accounting records in accordance with the provisions of the Companies
 Act, 1956 for safeguarding the assets of your Company and for
 preventing and detecting fraud and other irregularities
 
 (d)The annual accounts were prepared on an ongoing concern basis
 
 XIII.  Conservation of energy, technology absorption, foreign exchange
 earnings and outgo
 
 The additional information required in accordance with sub- section
 (1)(e) of Section 217 of the Companies Act, 1956, read with the
 Companies (Disclosure of Particulars in the Report of the Board of
 Directors) Rules,1988, is appended to and forms part of this Report.
 
 XIV. Corporate Governance Report
 
 The Corporate Governance Report giving the details as required under
 Clause 49 of the Listing Agreement in the stock exchanges is given
 separately and forms part of the Director''s Report to shareholders.
 
 A certificate from the Statutory Auditors, M/s Sharp &
 
 Tannan Associates, Chartered Accountants, regarding compliance with the
 conditions of Corporate Governance as stipulated under Clause 49 of the
 Listing Agreement is also attached.
 
 With respect to the Corporate Governance Voluntary Guidelines, 2009
 issued by the Ministry of Corporate Affairs, Government of India, your
 Company is broadly complying with many of the requirements of the
 guidelines and is also in the process of implementing the remaining
 suggestions.  The gist of major compliance with the said guidelines is
 given below:
 
 a) Separation of offices of Chairman and Chief Executive:
 
 The roles and offices of Chairman and Chief Executive are separated.
 Mr. Nirmal Jain is a Chairman of the Company and Mr. R Venkataraman is
 the Managing Director of the Company.
 
 b) Remuneration of Directors: The Independent Directors on the Board
 are paid sitting fees for attending the meeting of the Board and / or
 any Committee thereof. Further, Independent Directors are paid
 commission as approved by the Board within the overall limit approved
 by the shareholders of the Company.
 
 c) Independent Directors: Independent Directors are not involved in the
 day-to-day management of the Company.
 
 d) Number of companies in which an individual may become a Director:
 The Company has appraised its board members about the restriction on
 number of other directorships.
 
 e) Internal Auditors: The Company has an internal audit department
 which carries out audits in designated areas.
 
 f) Internal Control: The Board ensures the effectiveness of the
 Company''s system of internal controls including financial, operational
 and compliance controls and risk management systems.
 
 XV.  Particulars of employees
 
 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 all the
 shareholders of the Company excluding the aforesaid information. The
 annexure is available for inspection at the registered office of the
 Company. Any shareholder interested in the said information may write
 to the Company Secretary at the registered office of the Company.
 
 XVI. Statutory Auditors
 
 M/s. Sharp & Tannan Associates, Chartered Accountants, Mumbai, retire
 at the ensuing Annual General Meeting and being eligible offers
 themselves for reappointment. M/s Sharp & Tannan Associates have sought
 reappointment and confirmed that their reappointment shall be within
 the limits of Section 224(1B) of the Companies Act, 1956. The necessary
 eligibility certificate under Section 224(1B) of the Companies Act,
 1956 was received from them. The Audit Committee and Board of Directors
 recommend the re- appointment of M/s Sharp & Tannan Associates,
 Chartered Accountants as the Auditors of the Company.
 
 XVII.  Appreciation
 
 Your Directors place on record their sincere appreciation for the
 assistance and guidance provided by the government, regulators, stock
 exchanges, other statutory bodies and Company''s bankers for the
 assistance, cooperation and encouragement extended to the Company.
 
 Your Company''s employees are instrumental in your Company scaling new
 heights, year after year. Their commitment and contribution is deeply
 acknowledged. Your involvement as shareholders is also greatly valued.
 Your Directors look forward to your continued support.
 
                                              On behalf of the Board 
 
                                                         Nirmal Jain
 
 Dated: May 15, 2012                                        Chairman