The Members,
 
 The Directors have great pleasure in presenting the 25th Annual Report
 on the performance of your Company for the financial year ended March
 31, 2011 along with Audited Statements of Accounts.
 
 1.0 FINANCIAL HIGHLIGHTS
 
 (a) PROFITABILITY                                  (Rs. in crore)
 
 Particulars                               2010-11       2009-10
 
 Profit for the Year                       3544.21       3013.07
 
 Prior Period Adjustments                 (-) 0.07          0.13
 
 Profit Before Tax                         3544.14       3013.20
 
 Provision for Income Tax               (-) 898.99    (-) 800.27
 (current year)
 
 Provision for Income Tax                    10.45        135.79
 (earlier years)
 
 Deferred Tax Liability(-)/              (-) 36.02          8.53
 
 Assets( )
 
 Profit After Tax                          2619.58       2357.25
 
 Transfer towards Provision                 142.47        123.92
 
 for Bad & Doubtful Debts u/s 36(1) 
 (viia)(c) of Income Tax Act, 1961
 
 Transfer to Special Reserve                634.32        568.61
 
 created and maintained u/s 36(1) 
 (viii) of Income Tax Act, 1961
 Debenture Redemption                         0.06             -
 
 Reserve
 
 Interim Dividend                           401.72        344.33
 
 Proposed Final Dividend                    197.99        172.17
 
 Corporate Dividend Tax paid                 66.72         58.52
 on Interim Dividend
 
 Proposed Corporate                          32.12         29.26
 
 Dividend Tax
 
 Transfer to General Reserve                262.00        236.00
 
 Balance carried to Balance                 882.18        824.44
 
 Sheet
 
 (b) LENDING OPERATIONS                          (Rs. in crore)
 
 Particulars                               2010-11        2009-10
 
 Sanction                                    61532          59228
 
 Disbursement                                31865          24487
 
 (c) R-APDRP OPERATIONS                          (Rs. in crore)
 
 Particulars                               2010-11        2009-10
 
 Sanctioned project cost                     13665           6237
 
 Disbursement                                 2257           1321
 
 2.0 FINANCIAL PERFORMANCE
 
 2.1 REVENUE
 
 The total income during the financial year 2010-11 was Rs.10,160.56
 crore registering an increase of 25.80% as compared to Rs.8,076.86
 crore in financial year 2009-10.  Operating income for the year
 increased from Rs.8,002.10 crore to Rs.10,128.49 crore showing an
 increase of 26.57%.  Interest income including lease income for the
 financial year 2010-11 was higher at Rs.9,776.32 crore against
 Rs.7,867.16 crore in 2009-10.
 
 2.2 EXPENSES
 
 Interest and other finance charges for the financial year 2010-11
 amounting to Rs.6,486.95 crore accounted for 98.04% of total expenses.
 Personnel and Administration expenses in the financial year 2010-11
 were 1.40% of total expenses and 0.09% of Loan Assets as against 2.09%
 and 0.13% respectively in the previous year. Further, Personnel and
 Administration expenses in the financial year 2010-11 were 1.43% of
 interest and other financial expenses as compared to 2.14% in the
 previous year.
 
 2.3 PROFIT
 
 During the financial year 2010-11, your Company earned a net Profit of
 Rs.2,619.58 crore as compared to Rs.2,357.25 crore for the financial
 year 2009-10 registering an increase of 11.13%.
 
 2.4 FURTHER PUBLIC OFFER (FPO)
 
 During the first quarter of financial year 2011-12, your Company made
 a Further Public Offer (FPO) of 22,95,53,340 equity shares of Rs.10/-
 each for cash through 100% book- building process with a price band of
 Rs.193-203 per equity share. The issue included a fresh issue of
 17,21,65,005 equity shares by the Company and an offer for sale of
 5,73,88,335 equity shares by the President of India acting through
 Ministry of Power, Government of India.
 
 The issue was priced at Rs.203/- per share. A discount of 5% to the
 issue price being Rs.10.15 per equity share determined pursuant to
 completion of the Book Building Process was offered to Eligible
 Employees and to Retail Bidders. The issue proceeds amounted to
 Rs.4,578.20 crore of which Rs.1,144.55 crore pertains to offer for
 sale. Thus, the total fresh capital including share premium raised
 through FPO was Rs.3,433.65 crore.
 
 The issue got a good response and was subscribed 4.31 times. The
 Qualified Institutional Bidders (QIB) portion got subscribed 6.92
 times, Non-Institutional portion 1.08 times, Retail portion 1.97 times
 and Employees category 0.87 times. The total number of applications
 received were 2,58,497. The equity shares under FPO got listed on the
 NSE and BSE on May 27, 2011. Post-issue, the holding of the
 
 Government of India stands at 73.72% and the balance is held by various
 investors.
 
 The issued and paid-up share capital increased from Rs.1,147.77 crore
 to Rs.1,319.93 crore.
 
 The issue proceeds have been fully utilized for the purpose as
 mentioned under the objects of the issue enumerated in the Offer
 Document.
 
 2.5 SHARE CAPITAL
 
 As on March 31, 2011, the paid-up share capital of the Company was
 Rs.1,147.77 crore consisting of 1,14,77,66,700 equity shares of Rs.10
 each. The Government of India held 89.78% of the equity share paid-up
 capital. The Company has issued 17,21,65,005 equity shares in May, 2011
 resulting in an increase of Rs.172.16 crore in paid up equity share
 capital. The post-issue paid-up equity share capital is Rs.1,319.93
 crore. The shareholding of Government of India in the Company now
 stands at 73.72%.
 
 2.6 DIVIDEND
 
 Your Directors have recommended a final dividend of Rs.1.50 per equity
 share (15%) on the total post issue paid up equity share capital of
 Rs.1,319.93 crore. This is in addition to an interim dividend of
 Rs.3.50 per equity share (35%) on the pre-issue paid up equity share
 capital of Rs.1,147.77 crore which was paid in January 2011.
 
 The total dividend for the financial year 2010-11 thus aggregates to
 Rs.5.00 (interim dividend of Rs.3.50 and final dividend of Rs.1.50)
 per equity share of Rs.10 each on the pre-issue equity share capital of
 Rs.1,147.77 crore and Rs.1.50 (final dividend) on the additional
 equity share capital of Rs.172.16 crore issued in May 2011.
 
 The final dividend will be paid after your approval at the Annual
 General Meeting. The total dividend pay-out for the year amounts to
 Rs.599.71 crore representing 22.89% of Profit after tax as against a
 dividend pay-out of Rs.516.50 crore representing 21.91% of Profit after
 tax in the previous year.
 
 3.0 INFRASTRUCTURE FINANCE COMPANY (IFC)
 
 Infrastructure Finance Company (IFC) is a new category of
 infrastructure funding entities introduced by Reserve Bank of India
 (RBI) in February 2010. Non-deposit taking Non Banking Financial
 Companies (NBFCs-ND) which satisfy minimum eligibility criteria
 relating to proportion of infrastructure loans (75% of total assets
 deployed in infrastructure loans), net owned funds (Rs.300 crore),
 credit rating (''A'' or equivalent of CRISIL, FITCH, CARE, ICRA or
 equivalent rating by any other accredited rating agencies), CRAR (15%
 with minimum Tier I capital of 10%) are eligible to apply to RBI and
 seek IFC status.
 
 IFC''s enjoy benefits including a lower risk weight on their bank
 borrowings (from a fl at 100% to as low as 20% for AAA rated
 borrowers), higher permissible bank borrowing (upto 20% of the bank''s
 capital funds) and relaxation in their single party & group lending
 exposure norms. It also enables to raise funds on a cost-competitive
 basis (including through issuance of Rupee-denominated infrastructure
 bonds that offer certain tax benefits to the bondholders). IFCs are
 also eligible to avail External Commercial Borrowings (ECBs) up to US$
 500 million in each fiscal year subject to maximum of 50% of their
 owned funds, from recognized lenders.
 
 RBI vide its letter dated July 28, 2010 classified your Company as an
 IFC, and consequently we can avail the benefits applicable to IFCs
 from time to time.
 
 4.0 ISSUE OF LONG TERM INFRASTRUCTURE BONDS
 
 As stated above, your Company was awarded the status of Infrastructure
 Finance Company (IFC) in July 2010 by RBI. Consequently, the Company
 became eligible to issue Long Term Infrastructure Bonds u/s 80CCF of
 Income Tax Act, 1961. Your Company came out with the public issue of
 Long Term Infrastructure Bonds from February 24, 2011 till March 22,
 2011 in four kinds of series i.e. Series 1 & 3 non cumulative and
 Series 2 & 4 cumulative. The interest rate of Series 1 & 2 was 8.30%
 and of Series 3 & 4 was 8.50%.  The Company collected a total of
 Rs.235.36 crore in all the series from the market to be utilized
 towards ''infrastructure lending''. The date of allotment of Long Term
 Infrastructure Bonds was March 31, 2011. These bonds are listed on
 Bombay Stock Exchange (BSE).
 
 5.0 EMPLOYEES STOCK OPTIONS PLAN (ESOP)
 
 Stock Options have been recognized world over as an effective
 instrument to attract and retain the talent in the organization and to
 align the interest of employees with those of the organization. Stock
 Options provide an opportunity to employees to share the growth of the
 Company and create long term wealth. They also promote the culture of
 employee ownership in the company.
 
 The Department of Public Enterprises (DPE) also through its guidelines
 on pay revision had made it mandatory for all the Central Public Sector
 Enterprises (CPSEs) to formulate an Employee Stock Option Plan (ESOP)
 and pay 10% to 25% of the Performance Related Pay (PRP) of the
 employees as ESOPs.  In accordance with these directions of the DPE,
 the Board of Directors had formulated an Employee Stock Option Plan
 titled as ''PFC-ESOP 2010'' and intends to grant ESOPs to the employees
 through a Trust. Shareholders had also approved this Employee Stock
 Option Plan in their last Annual General Meeting held on September 21,
 2010. However, no stock option has been granted so far under this plan.
 
 6.0 LENDING OPERATIONS
 
 Your Company issued sanctions of Rs.61,532 crore during the financial
 year 2010-11 compared to Rs.59,228 crore sanctioned during the
 financial year 2009-10. An amount of Rs.31,865 crore was disbursed
 during the same period to State, Central, Private and Joint Sector
 entities, compared to Rs.24,487 crore disbursed during the last year.
 With this, cumulative sanction of Rs.3,23,905 crore and disbursement of
 Rs.1,69,146 crore have been made by the Company as on March 31, 2011.
 
 In addition to above, an amount of Rs.13,665 crore was sanctioned and
 Rs.2,257 crore was disbursed during 2010-11 under R-APDRP scheme. With
 this, cumulative sanction under R-APDRP stands at Rs.21,821 crore and
 disbursement at Rs.3,903 crore.
 
 6.1. Financial Assistance
 
 6.1.1 Sector-wise
 
                                                   (Rs. in crore)
 
                               2010-11          Cumulative upto March, 
                                                        2011
 Category              Sanctions Disbursements Sanctions Disbursements
 
 State Sector              42345        20400    220116        125567
 
 Central Sector             2500         5944     35030         23761
 
 Private Sector            16687         3746     51045         10875
 
 Joint Sector                  0         1775     17714          8943
 
 Total                     61532        31865    323905        169146
 
 6.1.2 Discipline-wise
 
                                                      (Rs. in crore)
 
                               2010-11          Cumulative upto March,
                                                         2011
 
 Category               Sanctions Disbursements Sanctions Disbursements
 
 Thermal Generation         46995       19545     198303         83603
 
 Hydro Generation            3322        1733      32059         21767
 
 Wind, Solar and Bagasse      974         466       1888           893
 
 Renovation and 
 Modernization of             556         562       8556          5553 
 Thermal Power Stations
 
 Renovation & Uprating of 
 Hydro                          7          83       1387          1040
 Power Projects
 
 Transmission                4173        2616      34877         15835
 
 Distribution                 216        1825      14058          9298
 
 Short Term Loans            4265        4206      27495         27020
 
 Others*                     1024         829       5282          4137
 
 Total                      61532       31865     323905        169146
 
 * Others include Decentralized Management, Project Settlement, Pre
 Investment Fund, Technical Assistance Project, Medium Term Loan, Buyers
 Line of Credit, Equipment Manufacturing Loan, Loan for Asset
 Acquisition, Bill Discounting, Studies, Loan for Redemption of bonds,
 Purchase of power through PXI, Loan for Promoter''s Equity and
 Computerization etc.
 
 6.1.3 Product-wise
 
                                                   (Rs. in crore)
 
                              2010-11            Cumulative upto
                                                 March, 2011
 
 Category               Sanctions Disbursements Sanctions Disbursements
 
 Term Loans                 56440        26750    289609      136663
 
 Short Term Loans            4265         4206     27495       27020
 
 Leasing                        0           78      1043         784
 
 Grants                         0            4        74          52
 
 Others **                    827          827      5684        4627
 
 Total                      61532        31865    323905      169146
 
 ** Others include Debt Refinancing, Bridge Loan, Associated
 Infrastructure, Loan to Equipment Manufacturers, Buyers Line of Credit,
 Loan for Assets Acquisition, Bill Discounting, Purchase of power
 through PXI and Loan for Promoter''s Equity etc.
 
 6.2 Financial Assistance under R-APDRP
 
                                              (Rs. in crore)
 
                          2010-11        Cumulative upto March, 2011
 
 Category        Sanctioned               Sanctioned
                            Disbursements              Disbursements
 
               project cost               project cost
 
 Part A                750        217           5846          1667
 
 Part B              12915       2040          15975          2236
 
 Total               13665       2257          21821          3903
 
 7.0 REALISATION
 
 Your Company gives highest priority to the realisation of its dues
 towards principal, interest etc. Out of Rs.21,491.54 crore to be
 recovered towards principal, interest etc.  under rupee term loans,
 bill discounting, working capital, lease financing, foreign currency
 loan, loans for equipment financing and guarantee fee, an amount of
 Rs.21,417.86 crore was actually realised. This works out to an overall
 recovery rate of 99.66% (previous year 99.63%). The overall recovery
 rate has been consistently maintained at 96-99% for the last ten years.
 The company has achieved recovery rate of 99.81% in respect of
 principal amount due during the year.
 
 In terms of Prudential Norms applicable, the Company has made an
 additional provision amounting to Rs.29.14 crore on non-performing loan
 assets during the year. The Company has made a total provision
 amounting to Rs.36.06 crore for Non-Performing Assets (NPA) against
 Loan Assets in its Annual Accounts upto the year 2010-11. After making
 provision on NPA, the level of net Non-Performing Assets (NPA) has been
 recorded at Rs.194.60 crore forming 0.20% to the Total Loan Assets as
 on March 31, 2011.
 
 In addition to above the company has also made a provision of Rs.2.80
 crore in respect of a restructured loan asset classified as ''Standard
 assets'' in terms of RBI circular no.DBOD.No.BP.BC.85/21.4.048/2009-10
 dated March 31, 2010.
 
 8.0 BORROWINGS
 
 8.1 BORROWINGS FROM DOMESTIC MARKET
 
 Your Company mobilized funds amounting to Rs.26,057.39 crore from the
 domestic market during 2010-11 as against Rs.20,922.91 crore during
 2009-10. Out of the above, Rs.14,023.96 crore was raised by issue of
 unsecured taxable bonds in the nature of debentures, Rs.8,029.17 crore
 by way of long/medium term loans from Banks/FIs, and Rs.4004.26 crore
 by way of issue of Commercial Paper and Short Term Loans.
 
 8.2 EXTERNAL BORROWINGS
 
 During the financial year 2010-11, your Company raised External
 Commercial Borrowing (ECB) of USD 500 million through Syndicated Loan
 as per the following details:
 
 Amount                   Rate of    Tenor of       Average
 (USD in Million)         Interest   the Loan       Tenor
 
 240                      6MJPY      6 years        5 years
                   LIBOR 150bps
 
 260                      6MJPY      6 years        5 years
                   LIBOR 165bps
 
 8.3 REDEMPTION AND STATUS OF UNCLAIMED AMOUNTS BONDS
 
 The unclaimed balance amount of bonds as on March 31, 2011 wasRs.7.32
 crore (previous year -Rs.25.70 crore). This represents the amount
 remaining unclaimed/unpaid after redemption by the bondholders, as the
 bondholders had not surrendered their bond certificates. The
 bondholders have been individually advised to surrender bond
 certificates.
 
 9.0 CREDIT RATINGS Domestic
 
 During the financial year 2010-11, your Company''s long term domestic
 borrowing programme (including bank loans) was awarded the highest
 rating of ''AAA'' and ''LAAA by CRISIL and ICRA respectively. The
 Company''s short term domestic borrowing programme (including bank
 loans) was awarded the highest rating of ''P1 '' and A1 '' by CRISIL &
 ICRA respectively
 
 International
 
 During the financial year 2010-11, the international credit rating
 agencies Moody''s, Fitch and Standard & Poor''s have given to the
 company, long term foreign currency issuer ratings of '' Baa3'', ''BBB- ''
 & ''BBB-'' respectively, which are at par with sovereign rating for
 India.
 
 10.0 RISK MANAGEMENT
 
 10.1 ASSET LIABILITY MANAGEMENT
 
 Your Company has put in place an effective Asset Liability Management
 System and has constituted an Asset Liability Management Committee
 (ALCO) headed by Director (Finance). ALCO monitors risks related to
 liquidity and interest rate and also monitors implementation of
 decisions taken in the ALCO meetings. The liquidity risk is being
 monitored with the help of liquidity gap analysis.  The Asset Liability
 Management framework includes periodic analysis of long term liquidity
 profile of asset receipts and debt service obligations.  Such analysis
 is made every month in yearly buckets for the next 10 years and is
 being used for critical decisions regarding the time, volume and
 maturity profile of the borrowings, creation of new assets and mix of
 assets and liabilities in terms of time period (short, medium and
 long-term). The interest rate risk is managed by analysis of interest
 rate sensitivity gap statements, evaluation of Earning at Risk (EaR) on
 change of interest and creation of assets and liabilities with the mix
 of fixed and floating interest rates.
 
 The maturity profile of certain items of assets and liabilities as at
 March 31, 2011 is set out below:
 
 Maturity pattern of certain items of Asset and Liabilities based on
 Audited Balance Sheet as on March 31, 2011
 
                                                    (Rs. in crore)
 
 Particulars  2011-12  2012-13  2013-14  2014-15  2015-16  Beyond  Total
                                                          2015-16
 
 Rupee Loan 
 Assets          8505     7886     8666     8613     8921   56582  99173
 
 Foreign 
 Currency 
 Assets            86       55       55       55       50      95    396
 
 Investments     0.00     0.00     0.00     0.00     0.00      54     54
 
 Foreign 
 Currency          79      203       19     2322      390    1950   4963
 Liabilities
 
 Rupee 
 Liabilities    15239    10255     8997     2910    10623   32614  80638
 (Bonds   RTL 
   STL)
 
 10.2 FOREIGN CURRENCY RISK MANAGEMENT
 
 Your Company has put in place Currency Risk Management (CRM) policy to
 manage risks associated with foreign currency borrowings. The Company
 enters into hedging transactions to cover exchange rate and interest
 rate risk through various instruments like currency forward, option,
 principal swap, interest rate swap and forward rate agreements. As on
 March 31, 2011, the total foreign currency liabilities are USD 541.63
 million, JPY 42,797.05 million and Euro 26.66 million. On an overall
 basis, the currency exchange rate risk is covered to the extent of 15%
 through hedging instruments and lending in foreign currency.
 
 10.3 INTEGRATED ENTERPRISE WIDE RISK MANAGEMENT
 
 Your Company had constituted the Risk Management Committee of Directors
 to monitor various risks, examine risk management policies & practices
 and initiate action for mitigation of risks arising in the operations.
 To facilitate this, the Company had put in place an Integrated
 Enterprise – Wide Risk Management Policy (IRM Policy).
 
 The Company has identified 26 risks (11 quantifiable risks and 15 non
 quantifiable risks) which may have an impact on Profitability/business
 of the Company. In order to implement IRM policy, the Risk Management
 Committee of Directors constituted Risk Management Compliance Committee
 and a separate unit namely Corporate Risk Assurance unit (CRA) for
 monitoring of the identified risks.  The CRA unit constantly monitors
 the risk from time to time and ensures that the risks are being
 mitigated on time. The status report on quarterly basis is being
 submitted to Risk Management Compliance Committee & Risk Management
 Committee of Board. The minutes of the Risk Management Committee of
 Board is being submitted to the Audit Committee of Directors and the
 Board of Directors on quarterly basis.
 
 11.0 GENERATION PROJECTS 
 
 11.1 THERMAL PROJECTS
 
 Thermal Power generation comprises a major proportion of India''s total
 installed capacity. During the year 2010-11, the Company has sanctioned
 loans amounting to Rs.46,995 crore and disbursed an amount of Rs.19,545
 crore. The cumulative financial support provided by the Company for
 thermal generation scheme is Rs.1,98,303 crore out of which Rs.83,603
 crore has been disbursed till March 31, 2011.
 
 The major thermal generation projects sanctioned by your Company during
 the year are: Vodarevu TPP (2X800 MW), IB TPS (2X660 MW), Suratgarh TPP
 STG-V U7&8 (2X660 MW), Chhabra TPP U5&6 (2X660 MW), Bellary TPS UNIT
 3(700 MW).
 
 11.2 HYDRO GENERATION PROJECTS
 
 Hydro generation capacity in the country needs significant
 augmentation for overall systems to have optimal energy mix. During the
 year 2010-11, loans amounting to Rs.3,322 crore were sanctioned and an
 amount of Rs.1,733 crore was disbursed by your company. The cumulative
 financial support provided by the Company for hydro generation scheme
 is Rs.32,059 crore out of which Rs.21,767 crore has been disbursed till
 March 31, 2011.
 
 12.0 RENOVATION, MODERNISATION AND LIFE EXTENSION
 
 12.1 THERMAL PROJECTS
 
 During the year 2010-11, loans worth Rs.556 crore were sanctioned for
 R&M and life extension of thermal power plants and an amount of Rs.562
 crore was disbursed.  Cumulatively, an amount of Rs.8,556 crore has
 been sanctioned and Rs.5,533 crore stands disbursed till March 31,
 2011.
 
 12.2 HYDRO PROJECTS
 
 During the year 2010-11, the Company disbursed Rs.83 crore for R&M of
 hydro power projects. Cumulatively, an amount of Rs.1,387 crore has
 been sanctioned and Rs.1,040 crore stands disbursed till March 31,
 2011.
 
 13.0 ACCELERATED POWER DEVELOPMENT AND REFORM PROGRAMME (APDRP)
 
 Government of India (GoI) had introduced the Accelerated Power
 Development and Reforms Programme (APDRP) in X Plan to induce state
 power utilities to undertake reforms in power distribution.
 
 Government of India (GoI), financed 90% of the project cost as grant in
 special category states. In respect of other states (non-special
 category states), GoI financed 25% of the project cost as grant.
 SEBs/Utilities have to arrange remaining 10% of the fund in respect of
 special category states and 75% in respect of non-special category
 states from financial institutions, including PFC.
 
 As on March 31, 2011, your Company had sanctioned an amount of
 Rs.2,272.94 crore as APDRP counterpart loan towards 120 loans and has
 disbursed an amount of Rs.1,739.41 crore. The eleven States funded by
 your Company under APDRP are Haryana, Rajasthan, Uttar Pradesh, Delhi,
 Bihar, West Bengal, Andhra Pradesh, Jharkhand, Orissa, Maharashtra and
 Goa.
 
 14.0 RESTRUCTURED ACCELERATED POWER DEVELOPMENT AND REFORM PROGRAMME
 (R-APDRP)
 
 Ministry of Power, Government of India, had launched the Restructured
 Accelerated Power Development and Reforms Programme (R-APDRP) in July
 2008 with focus on establishment of base line data, fixation of
 accountability, reduction of AT&C losses upto 15% level through
 strengthening & up-gradation of Sub Transmission and Distribution
 network and adoption of Information Technology during XI Plan. Project
 area shall be towns and cities with population of more than 30,000
 (10,000 in case of special category states) as per census 2001.
 Projects under the scheme shall be taken up in two parts.  Part-A shall
 include the projects for establishment of baseline data and IT
 applications for energy accounting/ auditing & IT based consumer
 service centres. Part-B shall include regular distribution
 strengthening projects and will cover system improvement, strengthening
 and augmentation etc.
 
 The programme size is Rs.51,577 crore out of which Rs.10,000 crore is
 for Part A activities, Rs.40,000 crore is for Part B activities and the
 remaining Rs.1,177 crore is for enabling activities to be implemented
 by Ministry of Power/PFC under Part-C which shall include capacity
 building and development of franchisees in Distribution Sector. The
 entire amount of GoI loan (100%) for Part A of the project shall be
 converted into grant after establishment of the required Base-Line data
 system (IT implementation) within a stipulated time frame and duly
 verified by Third Party Independent Evaluation Agency. For Part B
 Projects upto 50% (90% for special category States) loan provided shall
 be converted into grant progressively on achievement of AT&C loss
 reduction targets for five years. If the utility fails to achieve or
 sustain the 15% AT&C loss target in a particular year, that year''s
 tranche of conversion of loan to grant will be reduced in proportion to
 the shortfall in achieving 15% AT&C loss target w.r.t the starting
 base-line figure. There is a provision of Rs.400 crore as grant
 towards incentive for utility staff in project areas where AT&C loss
 levels are brought below 15%.
 
 Your company has been designated as the nodal agency to operationalise
 the programme and shall act as a single window service under R-APDRP.
 As nodal agency, your Company shall receive a fee as well as the
 reimbursement of expenditure in implementation of the progarmme as per
 the norms to be decided by the RAPDRP Steering Committee.
 
 Sanctions and Disbursements
 
 Your Company, as nodal agency, has contributed significantly during
 the year in implementation of R-APDRP programme. Upto financial year
 2011, Part A(IT) schemes of all eligible 1401 towns, Part-A(SCADA)
 schemes for 28 out of 60 eligible towns and Part-B schemes in 823 of
 1100 eligible towns have been sanctioned. During the year, PFC
 appraised projects and RAPDRP Steering Committee has sanctioned
 Rs.13,665 crore of project during the financial year 2010-11 against
 the MoU target of Rs.9,000 crore set for PFC. The sanctions include
 Rs.147 crore for Part-A (IT) covering projects of 23 towns, Rs.603
 crore for 25 projects of Part-A (SCADA) and Rs.12,915 crore for
 projects of 584 towns under Part-B.
 
 Your Company has also disbursed the entire amount of Rs.2,257 crore
 released by Ministry of Power(MoP) during the financial year 2010-11
 upto March 31, 2011 to the state utilities for the projects sanctioned
 by the RAPDRP Steering Committee.
 
 During the financial year 2010-11, ring fencing of 810 towns were
 completed as against the MoU target of 350 towns.
 
 PFC/MoP recognizing the need and to keep pace with technology and
 contemporary knowledge and skill, imparted training on various themes
 for various levels of Power Utility personnel across the country.
 Training was imparted for 35,895 mandays, against the MoU target of
 4,000.
 
 Progress of Implementation of R-APDRP
 
 As a result of the efforts made by your Company during the year,
 significant progress has been achieved by the state utilities in
 implementation of the programme. IT Consultants have been appointed by
 all utilities, while IT implementation agencies have been appointed by
 all except north eastern (NE) states & Haryana, where the process is
 under way. Supervisory Control and Data Acquisition System (SCADA)
 consultants have been appointed in 16 utilities & 5 states have
 initiated process of appointment of SCADA Implementing Agencies.
 
 15.0 ULTRA MEGA POWER PROJECTS (UMPPs)
 
 15.1 GENERATION PROJECTS
 
 Your Company has been designated as the ''Nodal Agency'' by Ministry of
 Power (MoP), Government of India, for development of Ultra Mega Power
 Projects (UMPPs), with a capacity of about 4,000 MW each. So far, 16
 such UMPPs have been identified to be located at Madhya Pradesh
 (Sasan), Gujarat (Mundra), Chhattisgarh (Surguja), Karnataka,
 Maharashtra (Munge), Andhra Pradesh (Krishnapatnam), Jharkhand
 (Tilaiya), Tamil Nadu (Cheyyur), Orissa (Sundergarh), 2 Additional
 UMPPs in Orissa and 2nd UMPPs in Andhra Pradesh, Tamil Nadu, Gujarat
 and Jharkhand and 3rd UMPP in Andhra Pradesh.
 
 Upto March 31, 2011, twelve (12) Special Purpose Vehicles (SPVs) have
 been established by the Company for these UMPPs to undertake
 preliminary site investigation activities necessary for conducting the
 bidding process for these projects. Ministry of Power is the
 ''facilitator'' for the development of these UMPPs while Central
 Electricity Authority (CEA) is the ''Technical Partner''. These SPVs
 shall be transferred to successful bidder(s) selected through Tariff
 Based International Competitive Bidding Process for implementation and
 operation.
 
 Four (4) SPVs namely Coastal Gujarat Power Ltd. for Mundra UMPP in
 Gujarat, Sasan Power Ltd. for Sasan UMPP in Madhya Pradesh, Coastal
 Andhra Power Ltd. for Krishnapatnam UMPP in Andhra Pradesh and
 Jharkhand Integrated Power Ltd. for Tilaiya UMPP in Jharkhand have been
 transferred to the successful bidders as indicated below:
 
 S.                            Successful          Date of
     Name of SPV
 No.                           Bidder              Transfer
 
 1   Coastal Gujarat           The Tata            April 22,
     Power Ltd.                Power               2007
                               Company Ltd.
 
 2   Sasan Power               Reliance            August 7,
     Ltd.                      Power Ltd.          2007
 
 3   Coastal Andhra            Reliance            January 29,
     Power Ltd.                Power Ltd.          2008
 
 4   Jharkhand                 Reliance            August 7,
     Integrated                Power Ltd.          2009
     Power Ltd.
 
 In addition, Request for Qualification (RfQ) for Chhattisgarh UMPP was
 issued in March 2010 and RfQ for Orissa UMPP was issued in June 2010.
 
 15.2 INDEPENDENT TRANSMISSION PROJECTS (ITPs)
 
 Ministry of Power has also initiated Tariff Based Competitive Bidding
 Process for development and strengthening of Transmission system
 through private sector participation.
 
 The objective of this initiative is to develop transmission capacities
 in India and to bring in the potential investors after developing such
 projects to a stage having preliminary survey work, identification of
 route, preparation of survey report, initiation of process of land
 acquisition, initiation of process of seeking forest clearance, if
 required and to conduct bidding process etc.
 
 PFC Consulting Limited (PFCCL), a wholly owned subsidiary of PFC, was
 nominated as ''Bid Process Coordinator'' for independent transmission
 projects by Ministry of Power, Govt. of India.
 
 So far, 5 Special Purpose Vehicles (SPVs), two by PFC namely East North
 Interconnection Company Limited (ENICL) and Bokaro-Kodarma Maithon
 Transmission Company Limited (BKMTCL) and other three i.e.  Jabalpur
 Transmission Company Limited (JTCL), Bhopal Dhule Transmission Company
 Limited (BDTCL) and Nagapattinam-Madhugiri Transmission Company Limited
 (NMTCL) by PFC Consulting Limited, a wholly owned subsidiary of PFC,
 have been incorporated.
 
 East North Interconnection Company Limited (ENICL), an SPV established
 for enabling import of NER/NR(north eastern region/northern region)
 surplus power by NR, has been transferred to the successful developer
 i.e.  M/s Sterlite Technologies Limited on March 31, 2010.
 Bokaro-Kodarma Maithon Transmission Company Limited (BKMTCL) was
 established for evacuation system for Maithon RB, Kodarma and Bokaro
 Extension Thermal Power Plants. Ministry of Power, Government of India,
 has directed Power Grid Corporation of India Limited for taking up the
 work for above evacuation system.  Accordingly, the name of the company
 was struck off from the records of Registrar of Companies in December
 2010.
 
 Two other SPVs namely, Jabalpur Transmission Company Limited (JTCL) and
 Bhopal Dhule Transmission Company Limited (BDTCL) have been transferred
 to successful developer i.e. M/s Sterlite Transmission Project Private
 Limited on March 31, 2011.
 
 16.0 DISTRIBUTION REFORMS, UPGRADES & MANAGEMENT (DRUM)
 
 The Distribution Reform, Upgrades and Management (DRUM) project is an
 Indo-US initiative designed jointly by the Ministry of Power (MoP) and
 United States Agency for International Development (USAID). DRUM
 addresses the critical development challenge of providing commercially
 viable and dependable power.
 
 The overall goal of the DRUM project is to demonstrate commercially
 viable electricity distribution systems that provide reliable power of
 sufficient quality to consumers and to establish a commercial
 framework and a replicable methodology adopted by Indian Financial
 Institutions for providing non-recourse financing for DRUM activities
 and programmes.
 
 Your Company has been appointed as Principal Financial Intermediary
 responsible for technical assistance and training under DRUM
 components. The roles and responsibilities of PFC for DRUM project are
 to i) provide management and implementation support, ii) co-ordinate
 with all stakeholders, iii) act as a financial intermediary and banker
 for controlling and directing funds (loans and grants) and iv) design
 mechanism for leveraging resources of other FIs/ Bankers.
 
 DRUM TECHNICAL ASSISTANCE
 
 DRUM team consists of USAID, MoP & PFC and the beneficiary States are
 Karnataka, Gujarat and Maharashtra.  PFC provides financial assistance
 in the form of loan while USAID provides the grant component for
 creating Centre of Excellence in Distribution area.
 
 So far, your Company has sanctioned total loan amount of Rs.164.08
 crore for three DRUM Pilot Projects costing total of Rs.216.52 crore
 pertaining to Bangalore Electricity Supply Co. Ltd. (BESCOM),
 Maharashtra State Electricity Distribution Co. Ltd. (MSEDCL) and Madhya
 Gujarat Vij Co.  Ltd. (MGVCL) and has disbursed an amount of Rs.150.96
 crore towards these three projects as loan under DRUM scheme.
 
 Further, a cumulative grant sanctioned from USAID is USD 3.278
 million(i.e. Rs.14.80 crore at an exchange rate of USD 1=Rs.45.14 as on
 March 31, 2011) for aforesaid three DRUM Pilot Projects and a
 cumulative amount of USD 0.81 million(i.e.  Rs.3.71 crore at an average
 exchange rate of USD 1=Rs.45.75) is disbursed as USAID grant through
 PFC. The projects are on the verge of completion.
 
 DELIVERY THROUGH DECENTRALISED MANAGEMENT (DDM)
 
 DDM is a scheme sponsored by Ministry of Power with the objective of
 showcasing participatory models of excellence in distribution
 predominantly in rural area, which are sensitive to the local
 aspirations and requirements.
 
 PFC has been appointed as carrier agency for successful implementation
 of DDM Schemes. So far, Government of India (GoI) grant of Rs.5.03
 crore has been sanctioned for 14 schemes of NTPC Ltd. and Rs.0.89 crore
 for 1 scheme of West Bengal Renewable Energy Development Agency
 (WBREDA) totaling Rs.5.92 crore. An amount of Rs.2.80 crore is
 disbursed to NTPC Ltd. towards their 8 schemes.
 
 17.0 EXTERNALLY AIDED PROJECTS
 
 Your Company has a Line of Credit of Euro 100.56 million from KfW to
 finance RM&U of Hydro Electric Projects.  Funds from the facility would
 be used to finance RM&U schemes of six HEPs of Uttrakhand Jal Vidyut
 Nigam Ltd.  (UJVNL). Out of six projects, Notice for Inviting Tenders
 (NIT) has already been issued for the Kulhal project. For the remaining
 five projects, NIT is under process and is expected to be issued soon.
 
 18.0 INITIATIVE TOWARDS REFORMS AND RESTRUCTURING
 
 Your Company has been encouraging reforms for overall improvement in
 the financial and technical performance of the State Power Utilities
 (SPUs). During the year, PFC has disbursed an amount of Rs.1.17 crore
 of grant for reform related studies to MeSEB, KSEB, IPGCL & PPCL and
 Government of Jharkhand. Government of Punjab vide their notification
 dt. April 16, 2010 has unbundled Punjab State Electricity Board(PSEB).
 Similarly, Government of Tamil Nadu vide their notification dt. October
 19, 2010 has unbundled Tamil Nadu Electricity Board (TNEB).
 
 Your company is also encouraging IT initiatives in the SPUs for their
 overall operational improvement. During the year, an amount of Rs.3.60
 crore has been sanctioned and Rs.1.19 crore has been disbursed for
 computerization schemes of State Power Utilities (other than
 computerization schemes covered under R-APDRP).
 
 CATEGORIZATION OF UTILITIES
 
 Your Company classifies State Power Utilities, its principal borrowers,
 into A , A, B and C categories. The categorization is based on the
 pre-determined parameters including operational & financial performance
 of the utilities. The categorization enables PFC to determine credit
 exposure limits and pricing of loans to the state power utilities. As
 on March 31, 2011, 95 utilities were categorized, 26 as A , 31 as
 A, 28 as B and 10 as C
 
 Category                       No. of Utilities
 
 A                                   26
 
 A                                   31
 
 B                                   28
 
 C                                   10
 
 PFC is also stipulating appropriate conditions relating to
 implementation of reforms and improvement of performance while
 sanctioning financial assistance to its borrowers based on their
 appraisal
 
 QUARTERLY AND ANNUAL REPORT OF STATE POWER UTILITIES
 
 Your Company is bringing out one page research report on the
 performance of each of the state power utilities (SPUs) on a quarterly
 basis. The report contains key operational and financial performance
 parameters, reforms status, the status of implementation of Electricity
 Act 2003, areas of concern and conditions for improvement of
 performance etc. The report is sent to the stakeholders in the Power
 Sector. It is the endeavor of PFC to make the utilities realize the
 importance of preparing the quarterly report and compare performance of
 their utility vis-ΰ-vis other utilities and taking the mid term
 corrective measures for the overall improvement of the sector.
 
 During the year 2010-11, your Company issued performance reports for
 the quarters January 2010 to March 2010, April 2010 to June 2010, July
 2010 to September 2010 and October 2010 to December 2010 covering 34,
 39, 41 and 41 utilities respectively In addition, your Company brings
 out a Report on the Performance of State Power Utilities (SPUs)
 annually. The 7th Report for the year 2006-07 to 2008-09 covering 90
 SPUs has already been published. The report is a part of our effort to
 provide a reliable database which can help to gauge the pulse of
 reforms in the sector and the results associated with it. The report is
 also recognized by various stakeholders as a useful source of
 information regarding the state power sector. The report analyses the
 financial and operational performance e.g. profitability, gap between
 average cost of supply and average realization (Rs./kwh), net worth,
 capital employed, receivables, payables, capacity (MW), generation
 (Mkwh), AT&C losses(%) etc. and consumption pattern of the sector at
 utility, state, regional and national level. The Report for the years
 2007-08 to 2009-10 covering 77 utilities has been prepared and
 submitted to Ministry of Power as per the targets set in MoU. The fi
 nal report (8th) on the performance of all SPUs for the period 2007-08
 to 2009-10 is under finalization
 
 19.0 POLICY INITIATIVES
 
 Your Company constantly reviews and revises its lending & operational
 policies/procedures to suitably align these with market requirements as
 also with its corporate objectives. During the year, your company
 introduced new scheme to provide short term financial assistance to
 SPVs in Government Sector for meeting their working capital
 requirement, policy guidelines for partial prepayment on reset and
 prescribed mechanism of revolving bulk State Government guarantee, etc.
 
 During the year, the company also reviewed its policy guidelines for
 rating of Government Departments & project SPVs in Government Sector,
 debt-equity ratio, premature repayment of loans with a view to make the
 same borrower friendly.
 
 In spite of growing competition in the market as well as interest rate
 concerns on account of factors like increase in RBI policy rates,
 Inflation prevailing in this financial year etc., PFC maintained its
 spreads well and could balance its objectives of business growth &
 Profitability.  The guidelines/fee structure in respect of processing
 fee, appraisal fee and lead fee also reviewed during the year.
 
 20.0 CONSORTIUM LENDING SERVICES
 
 Under Consortium Lending Services, the company has during the financial
 year 2010-11, started regular disbursements for 1350 MW TPP of M/s
 Indiabulls Power Ltd., 3X360 MW TPP of RKM Ph-II, 1350 MW TPP of M/s
 Indiabulls Realtech Ltd., 96 MW HEP M/s Dans Energy Pvt.  Ltd, 120 MW
 HEP of M/s Jal Power Corporation Limited, 545 MW co-gen power project
 of M/s Vadinar Expansion Ph-I&II, 120 MW TPP of Indian Metal & Ferro
 Alloys Ltd.  and 700 MW TPP of M/s Ind Barath Energy Utkal Ltd. after
 achieving financial closure for these projects. During the financial
 year, documents have been executed for 6x660 MW TPP of M/s Coastal
 Andhra Power Ltd. (Krishnapattnam UMPP), 1350 MW TPP of M/s Indiabulls
 Realtech Ltd., 2x660 MW TPP of M/s Lanco unit 3&4, 660 MW TPP of M/s
 Ind Barath Power (Madras) Ltd., 96 MW HEP of M/s Madhya Bharat Power
 Corporation Ltd., 2x660 MW TPP of M/s East Coast Energy Pvt. Ltd.,
 Transmission line of M/s Parbati Koldam Transmission Company Ltd. 3x360
 MW TPP of M/s RKM Power Ph-II, 2x60 MW TPP of M/s Indian Metals & Ferro
 Alloys Ltd., and 6X600 MW TPP of M/s KSK Mahanadi Power Company Ltd.
 
 In the financial year 2010-11, interactive meetings with IPPs were
 organized to review the progress of projects supported by PFC and to
 discuss about future financial needs of IPPs to explore business
 opportunities.
 
 With the aim to give impetus to Consortium Lending Operations, your
 Company is working towards harnessing the huge business potential
 offered by the Power Sector. The Company has been carrying out passive
 syndication activities for projects where it is lead FI and also
 coordinating activities pertaining to Power Lenders Club. During the
 financial year, your Company has also been able to syndicate Rs.262
 crore for 1320 MW TPP of M/s East Coast Energy P. Ltd. and Rs.51 crore
 for 10 MW Solar project of M/s PLG Photovoltaic Ltd.
 
 In order to syndicate and make financial arrangements for the
 Projects/enterprises in the areas of power, energy, infrastructure and
 other industries, a separate subsidiary company namely PFC Capital
 Advisory Services Ltd has been incorporated on July 18, 2011.
 
 21.0 FACILITATION SERVICES
 
 The Company is constantly working towards exploring new opportunities
 for expanding its business in areas like financing Fuel Sources
 Development & Distribution, Equipment manufacturing, Nuclear Power
 projects, Hydel projects in Bhutan & Nepal etc.
 
 Your company has signed a Memorandum of Understanding (MoU) with NPCIL
 on October 28, 2010 to offer financial assistance as well as other
 services to NPCIL for its nuclear power capacity addition in the next
 20 years. In consequence, NPCIL has requested for financial assistance
 for its two Nuclear projects, KAPS unit#3&4 (2x700 MW) and RAPS
 unit#7&8 (2X700 MW) having project cost of Rs.11,459 crore and
 Rs.12,320 crore with debt component of Rs.8,021 crore and Rs.8,624
 crore respectively.
 
 During FY 2010-11, your company had sanctioned as well as disbursed
 loan amount of Rs.827 crore to Suzlon Group under Scheme for financing
 equipment manufacture for Power Sector. Further, new proposals for
 financial assistance were received from NHPTL for setting up of
 transformers testing laboratory, IndoSolar Ltd. for setting up of
 Line-3 for Solar cell manufacturing, among others.
 
 Apart from the above, your company is also exploring the possibility of
 extending services in the areas of financing of Hydel projects being
 developed in Nepal with linkage to India and Hydel projects being
 developed in Bhutan by Indian entities under Indo Bhutan bilateral
 treaty.
 
 22.0 ACQUISITION ADVISORY SERVICES
 
 The Company believes that institutional and regulatory reforms in the
 Indian power sector and increased investor interest will lead to
 consolidation in the power sector in order to ensure synergies and
 economies of scale.  In addition, the company believes that the
 increasing supply-demand gap in the power sector has driven the
 procurement of power from the private sector through competitive
 bidding. Further, high demand for efficiency and economies in
 generation are expected to lower the cost of tariff. Open access and
 power trading are likely to increase competition in the sector in the
 future.
 
 The company has therefore set up an Acquisition Advisory Services unit
 to focus on acquisition advisory services for power sector projects,
 including the identification of target projects and potential
 acquisitions and consolidation opportunities, and also provide techno-
 commercial appraisal of target projects.
 
 23.0 RENEWABLE ENERGY AND CLEAN DEVELOPMENT MECHANISM (RE&CDM)
 
 Renewable energy (RE) provides a number of primary and secondary benefi
 ts which are economic, social, environmental or technical in nature.
 Some of the key benefits related with renewable energy generation are
 increased power/energy availability, enhanced access to power in
 rural/remote areas, increased employment generation, enhanced energy
 security and environmental benefits. Therefore a good mix of these
 energy sources in the overall energy mix would enhance sustainable
 development at the state, national and global level.
 
 Today, in the International Renewable Energy market, India is fast
 becoming one of the world''s most attractive markets for Renewable
 Energy (RE) investments. India''s rise has been due to the effective
 policy and regulatory support for investment in renewable energy
 technologies (RETs).
 
 The central government has just launched the Jawaharlal Nehru Solar
 Mission and the Electricity Regulatory Commissions (CERC and SERCs) are
 promoting renewable energy generation through preferential tariffs. One
 of the main drivers in the future for enhancing RE generation is likely
 to be the mandatory renewable energy purchase obligations for utilities
 as mandated by the Electricity Act 2003 and declared by the state
 commissions.  Several states have also issued the Renewable Purchase
 Obligations (RPO).
 
 To tap the Renewable Energy business in state and private sector, your
 company has created a Strategic Business Unit for handling renewable
 energy portfolio since August 2008 for giving thrust on Renewable
 Energy and CDM.  During the financial year 2010-11, loans amounting to
 Rs.974 crores were sanctioned to support a capacity of 202 MW for solar
 and biomass generation projects in state and private sector.
 
 Your Company is also facilitating SPUs for Clean Development Mechanism
 (CDM) benefits for R&M of old Thermal & Hydro projects as per mandate
 from MoP.  Four projects in the States of Meghalaya, Andhra Pradesh,
 Himachal Pradesh and Maharashtra have been identified for registration
 with United Nations Framework Convention on Climate Change (UNFCCC).
 The Project Design Documents (PDD) for 4 projects has been prepared
 through the consultant appointed by Asian Development Bank (ADB).
 Ministry of Environment and Forest (MoEF) has accorded host country
 approval for Koradi Thermal Power Project (Maharashtra), Umiam HEP
 (Meghalaya) and Giri HEP (Himachal Pradesh).
 
 In order to promote green (renewable and non- conventional) sources of
 energy, a separate subsidiary company namely PFC Green Energy Limited
 has been incorporated during the year.
 
 24.0 PROMOTION OF POWER TRADING THROUGH POWER EXCHANGE
 
 In the financial year 2008-09, the Central Electricity Regulatory
 Commission had granted its permission to set up power exchanges in the
 country. As on date two power exchanges, namely, Power Exchange India
 Ltd. (PXIL) and Indian Energy Exchange Ltd. (IEX) are in operation.
 These power exchanges have a nationwide presence in the form of
 electronic exchange for trading in power. The trading through power
 exchanges have certainly lent an impetus for power sector development
 since it acts as an open and transparent mechanism for buyers and
 sellers and provides investment signal to the prospective investors.
 Further with the presence of these exchanges, the available resources
 shall be used optimally.
 
 In order to promote short term trading through power exchange, your
 company had promoted National Power Exchange Ltd (NPEX), jointly with
 NTPC, NHPC and TCS during 2008-09. Your company has contributed Rs.2.19
 crore (being 16.66% of paid up equity upto March 31, 2011) towards
 equity contribution. This exchange is yet to start its operation.
 
 Your company has also contributed Rs.1.75 crore (being 4.37% of paid up
 equity upto March 31, 2011) towards equity contribution in Power
 Exchange India Ltd., promoted by NSE and NCDEX.
 
 25.0 EQUITY FINANCING
 
 Equity investment business is generally considered as a logical
 extension of debt business. Your Company is endeavoring to make a mark
 in the area of equity investment so as to capitalize on its vast domain
 experience, attained during its over 20 years of operations in power
 sector debt financing. PFC aims to leverage its financial strength,
 large debt providing capability and power sector expertise to invest in
 equity of attractive power projects. Over a period of time, your
 company proposes to build an equity portfolio of power assets which
 could provide consistent gains in the form of dividend and/or capital
 appreciation.
 
 26.0 COMMERCIAL BANKING OPERATIONS
 
 The Company is currently in the preliminary stages of evaluating the
 possibility of establishing or acquiring a bank and is in the process
 of appointing a consultant in connection with such initiative.
 
 27.0 SUBSIDIARIES
 
 As a nodal agency designated by Government of India for development of
 Ultra Mega Power projects, your Company has so far established fourteen
 (14) wholly owned subsidiaries out of which twelve (12) are to
 facilitate the development of UMPPs and two (2) for the development of
 ITPs. On completion of the bidding process, so far five (5)
 subsidiaries have already been transferred to the successful bidder for
 implementation of the projects. The name of one of the subsidiary i.e.
 Bokaro-Kodarma Maithon Transmission Company Limited (BKMTCL) was struck
 off from the records of Registrar of Companies in December 2010 as
 Ministry of Power, Government of India, has directed Power Grid
 Corporation of India Limited for taking up its work.
 
 In addition, the Company has so far incorporated three wholly owned
 subsidiaries namely, PFC Consulting Limited, PFC Green Energy Limited
 and PFC Capita Advisory Services Ltd
 
 27.1 PFC CONSULTING LIMITED
 
 Background
 
 As you are aware, your Company had been offering consultancy support to
 the Power Sector through its Consultancy Services Group (CSG) since
 October 1999. Leveraging the experience of the CSG Unit and
 appreciating the growth in the services offered by the Group and
 recognizing the potential of such services in the reforming Power
 Sector, your Company decided to organize the services as a distinct
 dedicated business entity. Accordingly, PFC Consulting Limited (PFCCL)
 was ncorporated in the form of a wholly owned subsidiary on March 25,
 2008, in order to give it requisite autonomy in functions and fl
 exibility in operations. PFCCL is mandated to promote, organize and
 carry out consultancy services to the Power Sector and is also
 undertaking the work related to the development of UMPPs and ITPs.
 PFCCL has been nominated as the ''Bid Process Coordinator'' for selection
 of developer for the Independent Transmission Projects (ITPs) by
 Ministry of Power, GoI.
 
 Range of Services Offered
 
 The Services being offered by PFCCL in various areas nclude
 
 - Procurement of Power by Distribution Licensees
 
 - Govt. of India initiatives like UMPPs, ITPs etc
 
 - New & Renewable Energy Sources
 
 - Selection of Developers for Power Projects linked to Coal Blocks &
 Joint Venture Partners for Coal Blocks
 
 - Project Advisory Services including Selection of EPC Contractor
 
 - Reform, Restructuring and Regulatory Aspects
 
 - Capacity Building and Human Resource Development
 
 While PFCCL continues to undertake various assignments, its focus is on
 assignments relating to:-
 
 - Procurement of power through ''Case 1'' and ''Case 2'' of Guidelines for
 Determination of Tariff by Bidding Process for Procurement of Power by
 Distribution Licensees, issued by MoP, GoI.
 
 - Selection of JV Partners for development of Power Plants and Coal
 Blocks
 
 - New and Renewable Energy Sources.
 
 - Overall advisory services for development of a new Thermal Power
 Station
 
 - Restructuring/Implementation of reforms for State Utilities.
 
 Client Base
 
 Till date, consultancy services have been provided to 38 Clients spread
 across 21 States. Assignments have been undertaken in various states,
 which include Punjab, Rajasthan, Jharkhand, West Bengal, Himachal
 Pradesh,
 
 Bihar, Jammu & Kashmir, Meghalaya, Assam, Andhra Pradesh, Uttar
 Pradesh, Haryana, Chhattisgarh, Tamil Nadu, Orissa, Tripura, Madhya
 Pradesh, Kerala, Maharashtra, Karnataka and Delhi. The numbers of
 states including the profile of clients are given below:
 
 Clients                                              Nos.
 
 States/ UTs                                           21
 
 Total No. of Clients                                  38
 
 State Utilities                                       17
 
 Public Sector Undertakings                             7
 
 State Governments                                      4
 
 Regulatory Commissions                                 3
 
 Licensees/ IPPs                                        7
 
 During the financial year 2010-11, the total income of PFCCL has
 increased to Rs.52.60 crore as compared to Rs.45.27 crore in the 
 previous year and net Profit has ncreased to Rs.26.95 crore as 
 compared to Rs.21.62 crore in the previous year.
 
 27.1.1 SUBSIDIARIES OF PFC CONSULTING LTD
 
 JABALPUR TRANSMISSION COMPANY LIMITED (JTCL)
 
 SPV, Jabalpur Transmission Company Limited was ncorporated on September
 8, 2009 for development of transmission system project for ''System
 Strengthening Common for Western Region (WR) and Northern Region (NR)''.
 The project includes 756 kV Single D/C line from Dhramjaygarh to
 Jabalpur and 765 kV S/C line from Jabalpur Pool to Bina.
 
 The SPV was transferred to successful developer i.e M/s Sterlite
 Transmission Project Private Limited on March 31, 2011.
 
 BHOPAL DHULE TRANSMISSION COMPANY LIMITED (BDTCL)
 
 SPV, Bhopal Dhule Transmission Company Limited was incorporated on
 September 8, 2009 for development of transmission system project for
 ''System Strengthening for Western Region (WR)''. The project includes
 system Strengthening for WR (Jabalpur-Bhopal, Bhopal-Indore,
 Aurangabad-Dhule, Dhule-Vadodra), all 765 kV S/C lines with associated
 765 kV substation at Bhopal and Dhule.
 
 The SPV was transferred to successful developer i.e M/s Sterlite
 Transmission Project Private Limited on March 31, 2011.
 
 NAGAPATTINAM-MADHUGIRI TRANSMISSION COMPANY LIMITED (NMTCL)
 
 SPV, Nagapattinam-Madhugiri Transmission Company Limited was
 incorporated on May 20, 2011 for the development of the transmission
 system project for ''Transmission System Associated with IPPs of
 Nagapattinam/Cuddalore Area – Package A. The project includes
 Nagapattinam Pooling Station – Salem 765 kV D/C line, Salem – Madhugiri
 765 kV S/C line. The Bid Process for the project is underway.
 
 27.2 PFC GREEN ENERGY LIMITED
 
 PFC Green Energy Limited has been incorporated as a wholly owned
 subsidiary of the Company to extend finance and financial services to
 promote green (renewable and non-conventional) sources of energy with
 authorised capital of Rs.1,200 crore and subscribed share capital of
 Rs.0.05 crore. The company received its certificate of commencement of
 business on July 30, 2011.
 
 27.3 PFC CAPITAL ADVISORY SERVICES LIMITED
 
 PFC Capital Advisory Services Ltd, a wholly owned subsidiary of the
 Company has been incorporated on July 18, 2011 interalia to syndicate
 and make financial arrangements for the Projects/enterprises in the
 areas of power, energy, infrastructure and other industries. The
 authorised share capital of the company is Rs.1 crore and the initial
 paid up share capital of the company is Rs.0.10 crore.
 
 28.0 JOINT VENTURES AND ASSOCIATE COMPANIES 
 
 28.1 NATIONAL POWER EXCHANGE LIMITED
 
 In order to promote short term trading through power exchange, your
 company had promoted National Power Exchange Ltd (NPEX), jointly with
 NTPC, NHPC and TCS during 2008-09. Your company has contributed Rs.2.19
 crore (being 16.66% of paid up equity upto March 31, 2011) towards
 equity contribution. This exchange is yet to start its operation.
 
 28.2 POWER EQUITY CAPITAL ADVISORS PRIVATE LIMITED
 
 An advisory company namely Power Equity Capital Advisors Private
 Limited (PECAP) was incorporated to provide advisory services related
 to equity investments in Indian power sector, where your Company holds
 30% stake and the remaining being held by individuals.  However, being
 largely owned by individuals, the company was not able to transact any
 business as it was unable to provide the requisite comfort to its
 clients.  Therefore, in order to provide the requisite comfort to the
 clients and to substantially improve the possibility of PECAP to do
 meaningful business, the Board of Directors of PFC in February, 2011
 approved a proposal for acquiring 100% stake in PECAP.
 
 28.3 PTC INDIA LIMITED
 
 PTC India Limited (PTC) was jointly promoted by Power Grid, NTPC, NHPC
 and PFC. Your Company has invested Rs.12 crore which is 4.07% of total
 equity of PTC. PTC is the leading provider of power trading solutions
 in India, a Government of India initiated public-private partnership,
 whose primarily focus is to develop a commercially vibrant power market
 in the country.
 
 28.4 ENERGY EFFICIENCY SERVICES LIMITED
 
 Energy efficiency Services Limited (EESL) was incorporated on February
 11, 2010. EESL was jointly promoted by Power Grid, NTPC, REC and PFC
 with equal equity participation of Rs.25 crore each for implementation
 of Energy efficiency projects in India and abroad. EESL would be one of
 the main implementation arms of the National Mission on Enhanced Energy
 efficiency (NMEEE), which is one of the eight National Missions
 announced by the Hon''ble Prime Minister as a part of National Action
 Plan on Climate Change.
 
 29.0 MEMORANDUM OF UNDERSTANDING WITH GOVT.  OF INDIA
 
 For the Financial Year 2010-2011, your Company has surpassed all the
 ''Excellent'' level MoU targets in respect of the various performance
 parameters and is likely to be accorded ''Excellent'' rating.
 
 29.1 PRESIDENTIAL DIRECTIVES
 
 Your Company has implemented wage-revision w.e.f.  January 1, 2007 for
 the employees in the Executive Cadre in September 2009 and for
 employees in non-unionised Supervisory Cadre in August 2010 as per
 Presidential Directives issued on April 2, 2009 and November 26, 2008.
 The Company has not received any Presidential directives during the
 year 2010-11.
 
 30.0 HRD INITIATIVES
 
 TRAINING & DEVELOPMENT
 
 In the field of Human Resource Development, your company stresses on
 the need to continuously upgrade the competencies of its employees and
 equip them to keep abreast of latest developments in the sector. The
 Company operates in a knowledge intensive business and is committed to
 enhancing these skills of its employees. In order to achieve this, the
 Company has an annual training plan to assess the various training
 needs. Necessary professional skills are also imparted across all
 levels of employees through customized training interventions.
 
 EMPLOYEE TRAINING
 
 During the year 2010-11, your company organized 19 in-house programs. A
 total of 1,572 mandays were achieved during the period under review of
 which 1,109 were through in-house programs and 463 were through
 nominations to open programmes organized by other training institutes.
 
 DRUM AND UTILITY TRAINING
 
 During the financial year 2010-11, 125 training programmes were
 organized through which 2,875 number of personnel were trained from
 various power utilities.  Apart from short-term training (5 days &
 less), the DRUM program also supports longer duration courses through
 collaborations with leading Institutes such as the Management
 Development Institute, Gurgaon, for an MBA in Power Distribution
 Management, The Energy Research Institute, New Delhi, for an MBA in
 Infrastructure and with Indira Gandhi National Open University for
 Advanced Certificate in Power Distribution Management.
 
 To further enhance the reach of its training activities, PFC had
 initiated the distance learning mode. In a collaboration agreement with
 the Indira Gandhi National Open University, in which PFC is the major
 sponsor, a certificate in Power Distribution Management of six months
 duration has been initiated for utility linesmen/ technicians located
 at remote centers who would otherwise not have access to training for
 upgradation of their skills.
 
 31.0 RESERVATION OF POSTS FOR SC/ST/OBC/EX- SERVICEMEN AND PHYSICALLY
 HANDICAPPED PERSONS IN THE SERVICES OF COMPANY
 
 Your Company as a part of its social responsibility makes all-out
 efforts to ensure compliance of the Directives and Guidelines issued by
 the Government for the reservation to be allowed for SC/ST/OBC/Persons
 with disabilities.  The steps taken include due reservations and
 relaxation as applicable under the various directives.
 
 In the year 2010-11, total 46 new employees were recruited, out of
 which 17.39% are SC (8), 4.35% are ST (2), 2.17% are PWD (1) and 21.74%
 are OBC (10).
 
 32.0 VIGILANCE
 
 During the financial year 2010-11, the Vigilance unit functioned as an
 effective tool of management with the thrust being on preventive
 vigilance. This aspect was emphasized by conducting periodic & surprise
 inspections of various units and by issuing effective guidelines to
 streamline systems with the aim of eliminating gaps and ensuring
 transparency in day to day operations. Information technology was used
 as an effective tool for providing on-line services to all the
 stakeholders and enhance organizational efficiency.  Vigilance Unit
 also undertook the review of operational manuals of various activities
 of the Company. A number of comprehensive manuals on different areas of
 company''s activities have already been notified after review and some
 other manuals are in process of finalization. Further during this
 period detailed investigation was carried out in several cases of
 registered complaints.
 
 In accordance with the directives of CVC, Vigilance Awareness Week was
 observed from October 25, 2010 to November 1, 2010 in the head office
 and regional offices of the Company. In order to increase scope of
 e-procurement in the Company and educating employees and borrowers of
 the Company about tendering procedures and to disseminate a strong
 message of integrity and transparency in public spending, interactive
 two days programme on Tendering and Procurement of Goods and Services
 including E-procurement was held for the benefit of the executives
 and borrowers of the Company so as to reap benefits of e-procurement
 and increase of transparency in procurement process and also to educate
 them on the initiatives taken for improvement in systems procedures.
 
 In compliance to the instructions of CVC, the sensitive posts in the
 Corporation were identified and HR Division has rotated the concerned
 officers working on these posts for a long time. Agreed lists were fi
 nalized in respect of Corporate office at Delhi and regional offices
 at Mumbai and Chennai in consultation with the local branches of CBI.
 Prescribed periodical statistical returns were sent to CVC, CBI, MOP on
 time.
 
 Thus, the vigilance Unit worked for continuous improvement of the
 systems with a view to bringing about transparency, objectivity and
 accountability thereby contributing to the overall efficiency and
 effectiveness of the organization.
 
 33.0 OFFICIAL LANGUAGE
 
 In your Company, Rajbhasha Neeti i.e. implementation of Official
 language policy is taken as a vital area of Management Operations.
 
 During the year, six workshops were organized to impart training to the
 employees with a view to help them in doing their Official work in
 hindi. Training programmes on use of ''Saransh'' package were also
 organized during the year. The ''Saransh'' bilingual package is available
 on the computers of all the employees in the Company including regional
 offices.
 
 A cultural programme was organized in Hindi on July 16, 2010 on
 Foundation day of the Company. To enhance the environment of Rajbhasha
 Hindi, Hindi Pakhwada was observed from September 14, 2010 to
 September 30, 2010. On the occasion of Hindi Day on September 14, 2010,
 the messages of Hon''ble Minister of Home Affairs, Hon''ble Minister of
 Power and Chairman and Managing Director of Company were circulated to
 all the employees of PFC. During the year, various competitions, like
 ''Vartani Shodhan'', ''Katha/Kahani Lekhan'', ''Noting and drafting in
 Hindi'' ''Chitrabhivyakti'', ''Shrut lekhan'' were organized.  A ''Kavi
 Sammelan'' was organized wherein renowned Hindi and Urdu poets like
 ''Padambhusan'' Shri Gopal Das ''Neeraj'', ''Padamshree'' Shri Surendra
 Dubey, Dr. Hari Om Pawar, Shri Arun Gemini, Dr. Suneel Jogi and Dr.
 Suman Dubey recited their poems.
 
 To help employees to do their day to day work in Hindi, several
 standard formats and other documents being used in various units of PFC
 were made available on Intranet of PFC. A glossary of the words being
 used in PFC was also uploaded on intranet.
 
 The bilingual quarterly in-house magazine ''Urja Deepti'' was brought out
 regularly. ''Rajbhasha Visheshank'' was also published and was highly
 appreciated by the readers.
 
 34.0 RIGHT TO INFORMATION ACT
 
 Your company has implemented Right to Information Act, 2005 (RTI Act,
 2005) in order to provide information to citizens and to maintain
 accountability and transparency.  The Company has designated Public
 Information officer (PIO), an Appellate Authority and also one
 Transparency officer at its registered office for effective
 implementation of the RTI Act, 2005. During the financial year
 2010-2011, all 57 applications received under the RTI Act, were duly
 processed and replied to. In compliance with Section 4 of the RTI Act,
 2005, RTI Manual has also been updated and put on PFC website. Your
 company has also complied with the directions of Central Information
 Commission (CIC) regarding filing of online Quarterly/ Annual Return
 for the financial year 2010-2011.
 
 35.0 AUDITORS
 
 M/s. Mehra Goel & Co., Chartered Accountants and M/s. Raj Har Gopal &
 Co., Chartered Accountants were appointed as Joint Statutory Auditors
 of the Company for the financial year 2010-2011 by the Comptroller &
 Auditor General of India.
 
 The Joint Statutory Auditors have audited the accounts of the Company
 for the financial year 2010-11 and have given their report without any
 qualification.
 
 36.0 FOREIGN EXCHANGE EARNINGS AND OUTGO
 
 The Foreign exchange outgo aggregating Rs.166.03 crore was made on
 account of debt servicing, financial & other charges, travelling and
 other miscellaneous expenses.
 
 37.0 PARTICULARS OF EMPLOYEES U/S 217 (2A) OF THE COMPANIES ACT, 1956.
 
 During the year 2010-11, the details of the employees who were in
 receipt of gross remuneration in excess of Rs.60 Lakh per annum or Rs.5
 Lakh per month and above, is given in Annexure A.
 
 38.0 HUMAN RESOURCE MANAGEMENT
 
 Your Company lays great emphasis on upgrading the skills of its Human
 Resources. It benchmarks its practices with the best practices being
 followed in the corporate world. This, apart from other strategic
 interventions, leads to effective management of Human Resources thereby
 ensuring high level of productivity. Your Company enjoys a very cordial
 and harmonious relationship with its employees. There were no man-days
 lost during the year. During the period under review, your Company has
 successfully negotiated the wage settlement valid till December 31,
 2016 with the employees in the workmen category.
 
 39.0 WELFARE MEASURES
 
 Your Company follows good management practices to ensure welfare of its
 employees through a process of inclusive growth & development. The
 Company follows an open door policy whereby the employees can access
 the top management thereby contributing in the management and growth of
 the company. Commitment of the workforce is ensured through an
 effective package of welfare measures which include comprehensive
 insurance, medical facilities and other amenities which in turn lead to
 a healthy workforce.
 
 40.0 CORPORATE SOCIAL RESPONSIBILITY
 
 Your Company has implemented its Corporate Social Responsibility (CSR)
 Policy with an aim to ensure that the Company becomes a socially
 responsible corporate entity contributing towards quality of life of
 the society at large. Your Company has entered into an MoU with
 Government of India for spending 0.5% of PAT towards
 
 CSR activities as part of its Corporate Social Responsibility.  The
 Company has undertaken major initiatives in several critical areas
 which impact the lives of the common man in a positive way. During the
 year, your Company had allocated Rs.11.89 crore for CSR initiatives.
 Your Company sanctioned Rs.5.00 crore for construction of houses for
 the fl ood affected marginalized sections of the population in Andhra
 Pradesh and provided assistance of Rs.3.50 crore to Ladakh in its
 process of reconstruction & environmental protection in Phyang village.
 Your Company also sanctioned Rs.3.38 crore for providing easy access of
 electricity to the people in the disturbed and border areas of the
 country for distribution of solar lanterns.
 
 41.0 REPRESENTATION OF WOMEN EMPLOYEES
 
 Your Company provides equal growth opportunities for its women
 employees and today the Company can boast of women heading critical
 functional areas. There is no discrimination of employees on the
 grounds of gender.  The women employees represent 19.73% of the total
 work force.
 
 42.0 GLOBAL COMPACT
 
 Your Company is a socially conscious organization and fully endorses
 the nine principles of Global Compact enunciated by the United Nations
 Organisation (UNO) which encompass areas of human rights, environmental
 protection and labour rights. These principles of Global Compact are
 embedded in various organizational policies of the Company thereby
 facilitating their implementation in a natural way. Your Company has
 been an active participant in various endeavors of the Global Compact
 and also provides sponsorship aid and support to other endeavors which
 are in line with the principles of Global Compact.
 
 Your Company lays special emphasis on medical facilities and health
 care for its employees and their families whereby they can avail best
 health care facilities. In pursuit of making the Company a learning
 organization it also supports integrated learning of its employees
 through a variety of measures.  Other aspects like promotion of sports,
 cultural heritage, community development etc. are also given due
 importance in our working by organizing various events etc. and also by
 providing sponsorship support on relevant occasions.
 
 43.0 GRIEVANCE REDRESSAL
 
 Your Company has Grievance Redressal Systems for dealing with the
 grievances of the employees, its customers and the public at large. The
 systems are duly notified and are easily accessible. A designated
 Nodal officer is responsible to ensure quick redressal of grievances
 within the permissible time frame. The company also has a notified
 Citizen''s Charter to ensure transparency in its work activities. This
 Charter is available on the website of the Company to facilitate easy
 access.
 
 44.0 STATUTORY AND OTHER INFORMATION REQUIRED
 
 nformation required to be furnished as per the Companies Act, 1956,
 Listing Agreement with Stock exchanges, Guidelines on Corporate
 Governance for CPSEs etc. is annexed to this report as follows:
 
 Particulars                                    Annexure
 
 Report on Corporate Governance                     I
 
 Management Discussion and Analysis                II
 Report
 
 Certificate on Corporate Governance              III
 
 Statement pursuant to Section 212 of the
 Companies Act, 1956 relating to subsidiary        IV
 companies
 
 45.0 DEBENTURE TRUSTEES
 
 The Company in line with the requirements of SEBI, appointed following
 Debenture Trustees for their different series of Bonds:
 
 Sl.  Name & Address of Trustee Bond Series
 No.
 
 1.  United Bank of India
 
 P-90/8, Connaught Circus
 
 New Delhi-110001
 
 9.70% TAXU PFC Bonds(2011)-X Series
 
 9.25% TAXU PFC Bonds(2012)-XI Series
 
 2.  IL&FS Trust Company Limited
 
 The IL&FS Financial Centre,
 
 Plot C-22, G-Block,
 
 Bandra Kurla Complex, Bandra East,
 
 Mumbai- 400 051
 
 9.60% TAXU PFC Bonds (2017)-XIII Series
 
 8.21% TAXU PFC Bonds (2017)-XVII Series
 
 7.87% TAXU- PFC Bonds (2017)-XVIII Series
 
 Zero Coupon Bonds-(2022) XIX Series
 
 3 IDBI Trusteeship Services Ltd
 
 Asian Building,
 
 Ground Floor,
 
 17, R. Kamani Marg,
 
 Ballard Estate,
 
 Mumbai- 400 001
 
 6.80% TAXU PFC Bonds (2011)-XXI-A Series
 
 7.00% TAXU PFC Bonds (2011)-XXI-B Series
 
 7.00% TAXU PFC Bonds (2011)-XXII Series
 
 6.00% PFC Infrastructure Bonds(u/s 88)-I Series
 
 8.85% TAXU PFC Bonds (2021)-XXVIII Series
 
 8.80% TAXU PFC Bonds (2016)-XXIX-A Series
 
 8.55% TAXU PFC Bonds (2011)-XXIX-B Series
 
 8.49% TAXU PFC Bonds (2011)-XXX Series
 
 8.78% TAXU PFC Bonds (2016)-XXXI-A Series
 
 9.25% TAXU PFC Bonds (2012)-XXXII Series
 
 9.80% TAXU PFC Bonds (2012)-XXXIII-A Series
 
 9.90% TAXU PFC Bonds (2017)-XXXIII-B Series
 
 9.90% TAXU PFC Bonds (2017)-XXXIV Series
 
 MIBOR Linked TAXU PFC Bonds (2011)-XLVI- Series
 
 9.55% TAXU PFC Bonds (2011)-XLVII- A Series
 
 9.60% TAXU PFC Bonds (2013)-XLVII- B Series
 
 9.68% TAXU PFC Bonds (2018)-XLVII- C Series
 
 10.75% TAXU PFC Bonds (2011)-XLVIII- A Series
 
 10.70% TAXU PFC Bonds (2013)-XLVIII- B Series
 
 10.55% TAXU PFC Bonds (2018)-XLVIII- C Series
 
 10.90% TAXU PFC Bonds (2013)-XLIX- A Series
 
 10.85% TAXU PFC Bonds (2018)-XLIX- B Series
 
 10.85% TAXU PFC Bonds (2011)-50- A Series
 
 10.75% TAXU PFC Bonds (2013)-50- B Series
 
 10.70% TAXU PFC Bonds (2015)-50- C Series
 
 11.15% TAXU PFC Bonds (2011)-51- A Series
 
 11.10% TAXU PFC Bonds (2013)-51- B Series
 
 11.00% TAXU PFC Bonds (2018)-51- C Series
 
 11.40% TAXU PFC Bonds (2013)-52- A Series
 
 11.30% TAXU PFC Bonds (2015)-52- B Series
 
 11.25% TAXU PFC Bonds (2018)-52- C Series
 
 8.90% TAXU PFC Bonds (2014)-54-A Series
 
 6.90% TAXU PFC Bond (2012)-55-A-Series
 
 7.50% TAXU PFC Bonds (2014)-55-B-Series
 
 7.20% TAXU PFC Bonds (2012)-56 Series
 
 8.60% TAXU PFC Bonds (2014)-57-B Series
 
 8.60% TAXU PFC Bonds (2019)-57-B-Series
 
 8.60% TAXU PFC Bonds (2024)-57-B-Series
 
 7.75% TAXU PFC Bonds (2012)-58-A-Series
 
 8.45% TAXU PFC Bonds (2014)-58-B-Series
 
 8.45% TAXU PFC Bonds (2014)-Series-59A
 
 8.80% TAXU PFC Bonds (2019)-59B-Series
 
 INCMTBMK linked TAXU PFC Bonds(2012)-60-A-Series
 
 INCMTBMK linked TAXU PFC Bonds(2019)-60-B-Series
 
 8.50% TAXU PFC Bonds (2014)-61- Series
 
 8.50% TAXU PFC Bonds (2019)-61- Series
 
 8.50% TAXU PFC Bonds (2024)-61-Series
 
 8.70% TAXU PFC Bonds (2020)-62-A-Series
 
 8.80% TAX U PFC Bonds (2025)-62-B-Series
 
 8.90% TAXU PFC Bonds (2015)-63-Series
 
 8.95% TAXU PFC Bonds (2015)-64-Series
 
 8.95% TAXU PFC Bonds (2020)-64-Series
 
 8.95% TAXU PFC Bonds (2025)-64-Series
 
 4.  The Western India Trustee & Executor Co. Ltd.
 
 c/o IDBI Trusteeship Services Limited,
 
 Asian Building, Ground Floor, 17, R. Kamani Marg,
 
 Ballard Estate,
 
 Mumbai-400 001
 
 7.00% TAXU PFC Bonds (2012)-XXIII Series
 
 7.60% TAXU PFC Bonds (2015)-XXV Series
 
 7.95% TAXU PFC Bonds (2016)-XXVI Series
 
 8.20% TAXU PFC Bonds (2016)-XXVII-A Series
 
 8.09% TAXU PFC Bonds (2013)-XXVII-B Series
 
 9.96% TAXU PFC Bonds (2017)-XXXV Series
 
 10.00% TAXU PFC Bonds (2012)-XXXVI-B Series
 
 9.80% TAXU PFC Bonds (2012)-XXXVIII Series
 
 9.22% TAXU PFC Bonds (2012) – XL –B Series
 
 9.28% TAXU PFC Bonds ( 2017) – XL –C Series
 
 8.94% TAXU PFC Bonds (2013) – XLI –B Series
 
 9.03% TAXU PFC Bonds (2013) - XLII –B Series
 
 9.30% TAXU PFC Bonds (2013) – XLIII-B Series
 
 9.40% TAXU PFC Bonds (2013) – XXXIV Series
 
 5.  PNB Investment Services Ltd.
 
 10, Rakesh Deep Building,
 
 Yusuf Sarai Commercial Complex,
 
 Gulmohar Enclave,
 
 New Delhi-110049
 
 8.70% TAXU PFC Bonds-65-Series
 
 8.65% TAXU PFC Bonds-66 A-Series
 
 8.75% TAXU PFC Bonds-66 B-Series
 
 8.85% TAXU PFC Bonds-66 C-Series
 
 7.10% TAXU PFC Bonds-67-Series
 
 8.25% TAXU PFC Bonds-68 A-Series
 
 8.70% TAXU PFC Bonds-68 B-Series
 
 7.89% TAXU PFC Bonds-69 –Series
 
 8.78% TAXU PFC Bonds-70-Series
 
 9.05% TAXU PFC Bonds-71 Series
 
 8.97% TAXU PFC Bonds-72-A Series
 
 8.99% TAXU PFC Bonds-72 B-Series
 
 6 GDA Trustee & Consultancy Private Ltd.
 
 Shri Niwas 1202/29
 
 Apte Road,
 
 Shivajinagar,
 
 Pune-411004
 
 Long Term Infrastructure Bonds 2011-Series-I
 
 Long Term Infrastructure Bonds 2011-Series-II
 
 Long Term Infrastructure Bonds 2011-Series-III
 
 Long Term Infrastructure Bonds 2011-Series-IV
 
 46.0 COMMENTS OF COMPTROLLER & AUDITOR GENERAL OF INDIA
 
 The Comptroller and Auditor General of India has mentioned that on the
 basis of audit, nothing significant has come to their knowledge which
 would give rise to any comment upon or supplement to Statutory
 Auditors'' Report under Section 619(4) of the Companies Act, 1956
 
 47.0 DIRECTORS'' RESPONSIBILITY STATEMENT
 
 As required under Section 217(2AA) of the Companies Act, 1956, your
 Directors confirm that:
 
 - In the preparation of the annual accounts for the financial year
 2010-11, the applicable accounting standards had been followed along
 with proper explanation relating to material departures;
 
 - 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 at the end of the financial year 2010-11 and of the Profit
 of the Company for that period;
 
 - The Directors had taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provision of the Companies Act, 1956 for safeguarding the assets of the
 Company and for preventing and detecting fraud and other
 irregularities; and
 
 - The Directors had prepared the Annual Accounts on going concern
 basis.  
 
 48.0 ACKNOWLEDGEMENT
 
 The Board of Directors acknowledge and place on record their
 appreciation for the guidance, co-operation and encouragement extended
 to the Company by the Government of India, Ministry of Power, Ministry
 of Finance, Reserve Bank of India, Department of Public Enterprises,
 Securities and Exchange Board of India, National Stock Exchange of
 India Limited, Bombay Stock Exchange Limited and other concerned
 Government departments/agencies at the Central and State level as well
 as World Bank, the Asian Development Bank, USAID, KfW of Germany, EDC
 of Canada and various international financial institutions/banks,
 agencies etc.
 
 The Board also conveys its gratitude to the shareholders, various
 International and Indian Banks/Multilatera agencies/financial
 Institutions/ credit rating agencies for the continued trust and for
 the confidence reposed by them in PFC. Your Directors would also like
 to convey their gratitude to the clients and customers for their
 unwavering trust and support.
 
 The Company is also thankful to the Comptroller & Auditor General of
 India and the Statutory Auditors for their constructive suggestions and
 co-operation
 
 The Board would also like to place on record our appreciation for the
 untiring efforts and contributions made by the employees to ensure
 excellent all round performance of the Company.
 
                          For and on behalf of the Board of Directors
 
 Place : New Delhi                                      (Satnam Singh)
 
 Dated August 26, 2011                   Chairman & Managing Director