The Directors have pleasure in presenting the Twelfth Annual Report
 alongwith Audited Accounts of the Company for the year ended March 31,
 2011.
 
 PHYSICAL PERFORMANCE
 
 During the year, the Company recorded sales as under
 
 Figures in Million Standard Cubic Meters (mmscm)
 
 Product                         For the Year       %
 
                             2010-2011  2009-2010  Growth
                                                   (YoY)
 
 Compressed                     817.76     695.13   17.6
 Natural Gas (CNG)
 
 Piped Natural Gas              179.89      87.31  106.0
 (PNG)
 
 Total                          997.65     782.44   27.5
 
 Average Sales                    2.73       2.14   27.5
 Per day (mmscmd)
 
 FINANCIAL RESULTS                           (Rs. in Crores)
 
                                            For the year 
 ITEMS                                   2010-2011   2009-2010
 
 Net Sales & Other Income                  1753.55     1099.22
 
 Profit before Depreciation & Tax           488.58      401.89
 
 Depreciation                               102.87       77.45
 
 Profit before tax                          385.71      324.44
 
 Provision for tax                          125.94      108.94
 
 Profit after tax                           259.77      215.50
 
 Profit brought forward from                593.73      473.25 
 
 previous year
 Profit available                           853.50      688.75 
 for appropriations
 
 Appropriations:
 
 Proposed dividend                           70.00       63.00
 
 Corporate dividend tax                      11.35       10.46
 
 Transferred to general reserve              25.98       21.55
 
 Profit carried forward                     746.17      593.74
 
                                            853.50      688.75
 
 FINANCIAL REVIEW
 
 The Company has been showing consistently good financial performance
 both in terms of turnover and profitability. During the year, gross
 turnover of the Company increased by 60.86% from Rs. 1213.13 crores in
 year 2009-10 to Rs. 1951.50 crores in the year 2010-11. Profit after
 tax also went up by 20.54% from Rs. 215.50 crores in 2009-10 to Rs.
 259.77 crores in 2010-11.
 
 DIVIDEND
 
 Your Directors are pleased to recommend higher dividend of 50% (Rs 5
 per share) as against 45% (Rs 4.50 per share) in the last year. The
 proposed dividend including corporate dividend tax would absorb Rs.
 81.35 crores.
 
 PERFORMANCE HIGHLIGHTS
 
 CNG BUSINESS
 
 During the year, your Company augmented its CNG distribution
 infrastructure significantly by enhancing the capacity of existing
 stations and adding new stations. The number of stations went up from
 241 in March 2010 to 278 in March 2011, which included 240 stations in
 Delhi and 38 stations in National
 
 Capital Region (NCR). By capacity enhancement as well as new stations,
 the installed compression capacity went up substantially by 40.5% from
 36.40 Lakh Kg/day in March 2010 to 51.13 Lakh Kg/day in March 2011.
 
 During the year 2010–11, the Company for the first time started online
 CNG supply to vehicles in Ghaziabad.
 
 The estimated number of vehicles running on CNG in Delhi and NCR as on
 31st March 2011 was over 4,30,000 including 16,500 buses and 2,70,000
 private vehicles.
 
 PIPED NATURAL GAS BUSINESS PNG - Domestic Connections
 
 A major thrust has been given to the expansion of Piped Natural Gas
 (PNG) network in Delhi and NCR i.e. Gautambudh Nagar (Noida, Greater
 Noida) and Ghaziabad.
 
 For PNG domestic connections, Delhi has been divided into 70 areas
 (each area is equivalent to MLA constituency). The pipeline network is
 already extended to 55 areas and work is in progress to extend the
 network to the remaining areas. During the year, your Company has
 extended the PNG network in various localities in Delhi, namely:
 
 - North Delhi – Rohini (sectors 1 to 8), Ashok Vihar, Tagore Park,
 Outram Lines, Hudson Lane, Keshav Puram.
 
 - South Delhi – Anand Niketan, Shanti Niketan, West End, IIT, NCERT,
 Kaushalya Park, Hauz Khas, Ayurvigyan Nagar.
 
 - West Delhi – Paschim Vihar (remaining areas), Vikas Puri, Hari Nagar,
 Arihant Nagar, Madipur, Tagore Garden, Rajouri Garden, Punjabi Bagh
 West and Extn.  (remaining areas), Janak Puri (remaining areas).
 
 - East Delhi – Preet Vihar, Nirman Vihar, Vikas Marg Societies, Chitra
 Vihar, GTB Janta Flats, Jafrabad, Gagan Vihar, Madhuban Enclave, Nirman
 Vihar, Ramnagar, Mansarovar DDA Flats, Swasthya Vihar.
 
 - Central Delhi – Patel Nagar, Ramesh Nagar, Bali Nagar, Kirti Nagar,
 Mansarovar Garden, Saraswati Garden, Punjabi Bagh (East).
 
 In Noida, your Company during the year has extended the PNG supply to
 Sectors 33 – 35, 39 – 41, 50 – 53, 55 and 56.
 
 In Greater Noida, your Company during the year has extended the PNG
 supply to Sectors Beta I & II and Pie.
 
 In Ghaziabad, the PNG supply has been extended to Indirapuram,
 Vaishali, Vasundhara, Surya Nagar, Chander Nagar, Rampuri, Shalimar
 Garden, Rajender Nagar and Lajpat Nagar.
 
 During the year, your Company provided total 62,918 new domestic PNG
 connections in Delhi and NCR and the total number of connections went
 up from 1,82,006 in March 2010 to 2,44,924 in March 2011. In Delhi,
 your Company provided 45,289 PNG connections as against the target of
 35,000 connections set by the Petroleum & Natural Gas Regulatory Board
 (PNGRB).
 
 PNG – Commercial & Industrial
 
 During the year, the Company gave a major thrust to boost the sales
 volume of Commercial and Industrial customers. In Delhi and NCR, the
 total number of commercial customers increased from 355 in March 2010
 to 463 in March 2011 and industrial customers from 14 in March 2010 to
 68 in March 2011. During the year 2010-11, the sales volume from
 industrial & commercial customers grew by 136% over the previous year.
 
 In Delhi, the Company has expanded its network to industrial areas of
 Mayapuri, Lawrence Road, Nangla Macchi, Badli etc, while MDPE laying
 activities are in progress in other industrial areas like Wazirpur,
 Jahangirpuri, Narela, Okhla, Nangloi, Mangolpuri, Naraina, Kirtinagar,
 Bawana, Mundka etc.
 
 In Noida, your Company has expanded its pipeline network to industrial
 areas of sector 60, 63 and 65. In Greater Noida, your Company has
 expanded its pipeline network to Industrial areas of Kasna Site IV & V,
 Udyog Vihar, Udyog Kendra & Surajpur Site B & C. In Ghaziabad, your
 Company has expanded its pipeline network to industrial area of
 Sahibabad. Pipeline laying activities are underway in the remaining
 major industrial areas in NCR which have huge demand potential.
 
 FUTURE OUTLOOK
 
 Your Company has drawn out plans to further consolidate its presence in
 Delhi and NCR by investing over Rs. 500 crores during the financial
 year 2011-12.
 
 In CNG, the new concept of Private Bus Cluster introduced by Government
 of Delhi is expected to add to good volume in sales. A significant
 growth is also expected from the private car owners in line with
 current trend of CNG conversion and launch of CNG variants by vehicle
 manufactures, in view of the economy offered by CNG in comparison to
 other fuels.
 
 Your Company has aggressive plans to expand its pipeline infrastructure
 to increase the coverage and penetration of the network. It shall be
 the continuous endeavour to expand fast the customer base on both
 Industrial & Commercial and domestic fronts.
 
 TOWARDS CUSTOMER DELIGHT
 
 In view of the changing dynamics in the business environment, your
 Company has been proactive in taking various initiatives towards
 customer delight. Your Company is the first city gas
 
 distribution Company to have launched an interactive customer portal to
 address customer needs and ensure speedy complaint redressal alongwith
 a 24x7 single number dialing customer care facility. The Company has
 taken a number of initiatives to promote wider use of natural gas such
 as through gas geysers, gas gensets etc. In this regard, the Company
 has tied up with leading manufacturers of gas gensets and gas geysers.
 With a view to promote genuine CNG retrofittment, the Company alongwith
 reputed suppliers is setting up model workshops at selected CNG
 stations.
 
 INFORMATION TECHNOLOGY
 
 Your Company has recently implemented customer portal which includes
 CRM (Customer Relationship Management) functionalities. The portal
 extends facilities such as PNG bill viewing & payment, complaint
 logging, new connection
 
 application etc as self service to customers. This system also provides
 single platform for IGL employees, customers and third parties to work
 collaboratively and achieve customer satisfaction. The Company has
 taken initiatives for advanced surveillance for its CNG stations,
 Disaster Recovery and Business Continuity planning, and GIS
 (Geographical Information System) use for effective Asset Management,
 Network Planning and Operations Management.
 
 HUMAN RESOURCES
 
 During the year, your Company enjoyed harmonious and cordial human
 relations amongst all its employees. Your Company undertook various HR
 initiatives to further infuse professionalism in the workforce, such as
 revised performance management system, induction only through campus
 recruitment of GETs / ETs and streamlining other HR policies.
 
 Comprehensive induction training was provided to new employees in
 association with GAILs Training Institute at Noida.  Training was
 imparted to employees on regular basis for knowledge and skill
 enhancement.
 
 There was no employee in the Company drawing remuneration more than the
 limits prescribed under Section 217 (2A) of the Companies Act, 1956
 read with the Companies (Particulars of Employees) Rules, 1975.
 
 HEALTH SAFETY AND ENVIRONMENT (HSE)
 
 Your Company has always accorded highest priority to Fire and Safety
 related issues. It is a matter of pride that your Company has crossed
 78 million man hours without any reportable lost time accident.
 
 Training is regularly imparted to the employees, contract staff at CNG
 stations, DTC Drivers and consumers of CNG and PNG.  To create safety
 awareness and impart training to all category of consumers, a dedicated
 group of trainers with fully equipped training van is deployed which
 conducts safety clinics alongwith practical demonstration.
 
 For safety of CNG vehicles, free safety camps are periodically
 organized where inspection of CNG kits is undertaken. Safety inspection
 of CNG vehicles is also done periodically on random basis to check
 compliances of safety standards and to prevent unsafe conditions
 arising out of gas leakage from the CNG kits.
 
 As per your Companys HSE policy, Safety Audit, HAZOP & Risk assessment
 of CNG Stations and PNG installations are carried out by third parties.
 The onsite emergency action plan is regularly rehearsed and updated.
 Emergency response vehicles are under procurement, which shall be
 stationed at emergency control centers, manned round the clock to
 respond fast to any gas leak or emergency situation.
 
 SOCIAL RESPONSIBILITY
 
 Your Company has formulated a CSR policy under which 1% of Profit After
 Tax (PAT) each year is earmarked for social causes.  Thrust areas for
 CSR programme have been identified as Health & Environment, Education
 and Care & Empowerment of underprivileged. The Company is making
 regular contribution to NGOs and charitable institutions towards social
 welfare. Your Company organizes regular medical health and eye check up
 camps for CNG vehicle drivers. The Company is supporting meritorious
 students from under-privileged strata of society for IIT coaching
 through a scheme run by an NGO. It is a matter of satisfaction that all
 the 7 children who were sponsored by the Company qualified in the IIT
 JEE examination 2011. The Company is also extending help to DTC by
 providing equipment and facilities aimed at inculcating safe driving
 habits among the drivers.
 
 DIRECTORS RESPONSIBILITY STATEMENT
 
 Pursuant to the provisions of Section 217(2AA) of the Companies Act,
 1956, your Directors hereby confirm that:
 
 i) in the preparation of Annual Accounts for the financial year ended
 March 31, 2011, the applicable accounting standards have been followed;
 
 ii) they have selected such accounting policies and applied them
 consistently except where otherwise stated in the Notes to Accounts 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 of the Company for the year
 under review;
 
 iii) 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
 
 iv) they have prepared the Annual Accounts for the Financial Year ended
 31st March, 2011 on a going concern basis.
 
 BOARD OF DIRECTORS
 
 Shri B. C. Tripathi, nominee of GAIL was appointed as Chairman of the
 Board w.e.f. January 14, 2011 in place of Shri S. Radhakrishnan.
 
 Shri K. K. Gupta, nominee of BPCL was appointed as Additional Director
 in place of Shri S. Radhakrishnan w.e.f.  March 01, 2011 and in terms
 of Section 260 of the Companies Act, 1956, he holds office until the
 ensuing Annual General Meeting.  Notice under Section 257 of the
 Companies Act, 1956 has been received proposing his name for
 appointment as Director at the Annual General Meeting.
 
 Shri Rajesh Vedvyas, nominee of GAIL was appointed as Managing Director
 for a period of three years i.e. upto July 28, 2011. GAIL has extended
 the secondment period of Shri Vedvyas upto March 31, 2012 and
 accordingly it is proposed to re-appoint him in the ensuing Annual
 General Meeting.
 
 Shri R. K. Verma, retires by rotation at the ensuring Annual General
 Meeting and being eligible, offers himself for re- appointment.
 
 Shri S. S. Dalal, retires by rotation at the ensuring Annual General
 Meeting and does not offer himself for re-appointment.
 
 The Board takes this opportunity to place on record its appreciation
 for valuable contribution made by Shri S.  Radhakrishnan, during his
 tenure as Chairman and Director of the Company.
 
 AUDITORS
 
 M/s. Deloitte Haskins & Sells, Chartered Accountants, Auditors of the
 Company retire at the ensuing Annual General Meeting and being
 eligible, offers themselves for reappointment.
 
 CORPORATE GOVERNANCE
 
 As per the requirements of the Clause 49 of the Listing Agreement with
 the Stock Exchanges a detailed Report on Corporate Governance is
 annexed as part of the Annual Report.
 
 CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
 EARNINGS AND OUTGO
 
 The 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 Board of Directors) Rules, 1988 is annexed
 hereto.
 
 ACKNOWLEDGEMENTS
 
 Your Directors express their gratitude to the Ministry of Petroleum &
 Natural Gas, State Governments of NCT of Delhi & Uttar Pradesh and
 Promoter Companies (GAIL & BPCL) for their continuous patronage &
 support throughout the year.
 
 The Directors also acknowledge the support of all the Local
 Authorities, Bankers, Media, Station Operators & their employees,
 contractors, vendors and suppliers.
 
 The Directors place on record their deep appreciation towards IGLs
 valued customers for their continued co-operation & support and look
 forward to the continuance of this relationship in future also.
 
 The Directors wish to express their gratitude to all the shareholders
 for their continued trust and support.
 
 The Directors also sincerely acknowledge the contributions made by all
 the employees of IGL for their dedicated services to the Company.
 
 For and on behalf of Board of Directors
 
           sd/-                                    sd/-
 
     Manmohan Singh                          Rajesh Vedvyas
 
     Director (Commercial)                   Managing Director
 
 Place : New Delhi 
 
 Date : June 14, 2011