It gives me immense pleasure to present on behalf of the Board of
 Directors, the 23rd Annual Report on the performance of your Company
 during the financial year ending March 31, 2012 together with Audited
 Statement of Accounts, Auditors'' Report and Review of the Accounts by
 the Comptroller and Auditor General of India for the review period.
 
 Your Company has once again surpassed its performance targets set forth
 under Memorandum of Understanding (MoU) with Ministry of Power (MoP),
 Government of India. Based on overall performance, your Company is
 poised to achieve ''Excellent'' rating for FY 2011-12 too.
 
 Your Company, in a brief span of 20 years, has grown by leaps and
 bounds and has carved a niche for itself amongst the largest
 transmission utilities in the world. The Company has been contributing
 significantly towards development of power sector in India through
 continuous innovations in technical & managerial fields and by
 undertaking coordinated development of power transmission network along
 with effective and transparent operation of Regional Grids and National
 Grid.
 
 In order to keep pace with changing business environment, your Company
 set its ''Vision'' to be the World Class, Integrated, Global
 Transmission Company with Dominant Leadership in Emerging Power Markets
 Ensuring Reliability, Safety and Economy and aligned its mission and
 objectives as a vanguard of foresight.
 
 Out of many challenges met by your Company, the performance of your
 Company has been specifically commended in (i) execution of last leg of
 Transmission System in Creek area of Gujarat for evacuation of power
 from the Country''s first Ultra Mega Power Project (UMPP) at Mundra
 before stipulated time, and (ii) restoration of Kishenpur-Wagoora 400kV
 Double circuit (D/c) transmission line in snow bound area of Kashmir
 valley about 5000 ft. above sea level within 48 hours under extreme
 hostile weather conditions.
 
 Your Company has heralded creditable accomplishments in all its areas
 of operations. The major achievements during the year are as under:
 
 Rs.  Investment of Rs. 17,814 Crore, an increase of about 48% over last
 year.
 
 -  Added about 10,600 circuit kilometre (ckm) of Extra High Voltage
 (EHV) transmission lines, 15 new EHV sub-stations and transformation
 capacity of more than 30,000 Mega Volt Ampere (MVA).
 
 -  Record commissioning of Assets worth Rs. 14,021 Crore.
 
 -  Investment approval accorded for 43 new transmission projects worth
 about Rs. 39,225 Crore.
 
 -  Transmission system availability attained - 99.94%, highest so far
 in the history of the Company.
 
 -  With the addition of Inter-Regional power transfer capacity of 5,600
 MegaWatt (MW), total inter-regional capacity of National Grid enhanced
 to 28,000 MW.
 
 FINANCIAL PERFORMANCE
 
                    (Figures in Rs. Crore, except per share data)
 
 Description                  2011-12      2010-11      Y-o-Y Growth
 
 Income
 
 Transmission Charges           9,544       7,903          20.76%
 
 Consultancy                      290         299           (3.0%)
 
 Telecom                          201         187            7.5%
 
 Other Income                     750         710            5.6%
 
 Total Income                  10,785       9,099           18.5%
 
 Profit After Tax (PAT)         3,255       2,697           20.7%
 
 Earnings per Share (Rs.)        7.03        6.19           13.6%
 
 Book Value per Share (Rs.)     50.73       46.12           10.0%
 
 Gross Fixed Assets            63,387      50,343           25.9%
 
 Long term borrowings *        51,752      39,433           31.2%
 
 Net Worth                     23,488      21,351           10.0%
 
 Debt Equity Ratio              69:31       65:35             -
 
 Commissioning                 14,021       7,313           91.7%
 
 -  including current maturities of long term borrowings.
 
 OPERATIONAL EXCELLENCE
 
 As on April 1, 2012, transmission assets of about 92,981 ckm of EHV
 transmission lines, 150 EHV sub-stations and transformation capacity of
 124,525 MVA, spread over the length and breadth of the Country are
 under operation. Your Company continues to wheel about 50% of total
 power generated in the Country through its transmission network.
 
 Your Company consistently maintains high availability of its
 transmission network by implementing technologically advanced
 operational techniques such as Hot Line Maintenance, Washing of
 Insulators hotline with the use of helicopters, Equipment Condition
 Monitoring techniques including Dynamic Testing of relays,
 Thermo-vision Scanning, Frequency Response Analysis (FRA) for
 transformers and reactors, large scale automation of sub-stations,
 etc.. Presently, 32 sub-stations of your Company are being operated
 remotely and many new sub-stations are being designed for remote
 operation. For further improvement in operational efficiency, a
 National Transmission Asset Management Centre is being established to
 facilitate centralised operation, monitoring & control of sub-stations
 remotely. This will help in optimal utilisation of manpower & other
 resources of a group of substations by creating Maintenance Service
 Hub facilities, and reduce the response time in case of faults &
 breakdowns.
 
 Replacement of conventional insulators with polymer insulators at
 polluted stretches in NCR area has contributed significantly in
 achieving safe, secure & reliable operation of Grid during foggy
 weather conditions.
 
 Average availability of transmission systems during the year 2011-12
 was maintained at 99.94%, highest ever in the history of the Company.
 Number of trippings per line was also abated at 0.59.
 
 To meet eventualities like earthquake, fire, cyclone, landslides,
 sabotage, etc., your Company has kept state-of-the-art Emergency
 Restoration Systems (ERS) at strategic locations for restoration of
 collapsed transmission line towers in shortest possible time.  Further,
 to mitigate the above eventualities in case of substation, a mobile
 400/220kV ERS substation is being procured, which will facilitate quick
 deployment & restoration of sub-station in only 1-2 weeks, which
 otherwise may take several months.
 
 Some potent options are also being explored like use of robotic
 technology for condition monitoring of conductor, earthwire & hardwares
 besides aerial patrolling of transmission lines using helicopters.
 
 PROJECT IMPLEMENTATION
 
 Your Company puts its best efforts to implement transmission projects
 within stipulated time frame to derive maximum economic benefits.
 Further, your Company takes a variety of measures such as advanced and
 cost effective Integrated Project Management and Control System (IPMCS)
 for total project review and monitoring, Standardisation of Designs,
 Project Review Meetings (PRMs) at regular intervals through video
 conferencing, pre-emptive measures and advance actions on various
 project linked activities such as land acquisition, survey and soil
 investigations, tender activities, funding tie-up, etc. in parallel
 with project investment approval process.
 
 All these dynamic facets led to excellent performance on project
 implementation front during FY 2011-12 and not a single MW power is
 bottled-up for want of our transmission. Transmission projects worth
 about Rs. 14,021 Crore were commissioned during the year, thereby adding
 about 10,600 ckm, 15 sub-stations and transformation capacity of more
 than 30,000 MVA in the transmission system. Major 400kV transmission
 lines commissioned during the year include Korba STPS-Raipur D/c,
 Wardha-Parli D/c(Quad), Baripada-Mendhasal D/c,
 Mundra-Bachau-Ranchorpura D/c (triple snowbird), Maithon RB-Ranchi D/c,
 Uri-II - Wagoora single circuit (S/c), Mauda-Wardha D/c(Quad) &
 Biharshariff-Sasaram D/c(Quad) lines. Major 765kV transmission lines
 commissioned during the year include Gaya-Balia, Balia-Lucknow,
 Seoni-Wardha, Bina-Indore, Sasaram-Fatehpur (Circuit-1), Gaya-Sasaram
 S/c lines.
 
 Notably, timely commissioning of 400kV D/C Mundra-Ranchorpura in
 September''11 and 400kV D/C Mundra-Limbdi D/c (triple snowbird) lines in
 February''12 associated with the 1st UMPP Project of the Country
 enhanced the image of confidence in power sector. In spite of severe
 Right-of-Way (RoW) problems, readiness of these systems had been
 ensured by your Company on its commitment.
 
 During the year, 43 new projects with an estimated cost of about Rs.
 39225 Crore involving about 16900 Ckt km of transmission lines, 22 new
 sub-stations and transformation capacity of about 56000 MVA, HVDC
 terminal capacity of 3000 MW and 16200 km of OPGW fibre optic cable
 were approved and taken up for implementation.
 
 FINANCIAL MANAGEMENT
 
 Your Company has recorded an impressive financial performance during FY
 2011-12, achieving a turnover of Rs. 10,785 Crore and Net Profit of Rs.
 3,255 Crore as compared to Rs. 9,099 Crore and Rs. 2,697 Crore respectively
 during FY 2010-11. The gross asset base of the Company has been
 enhanced to Rs. 63,387 Crore from Rs. 50,343 Crore in 2010-11, an increase
 of about 25.9%.
 
 Your Company, through its improved performance in Telecom and
 Consultancy businesses, also enhanced value for the shareholders.
 
 Capital Investment and Fund Mobilization
 
 The Company undertook capital investment of Rs. 17,814 Crore during the
 financial year 2011-12, which is about 48% higher than last year. Rs.
 9,698 Crore were mobilised from domestic market through private
 placement of bonds with attractive coupon rates and proceeds of ongoing
 loans from multilateral funding agencies, viz. The World Bank (WB) and
 Asian Development Bank (ADB) were utilised, besides accrued internal
 resources.
 
 During the year, your Company has also tied up a line of credit of Rs.
 5000 Crore from State Bank of India, of which Rs. 1000 Crore has been
 drawn in FY 2011-12 and balance is to be drawn in the subsequent years
 for part financing of the capital expenditure of POWERGRID projects.
 
 Domestic credit rating agencies namely, CRISIL, CARE and ICRA have
 assigned credit ratings of AAA/Stable (triple AAA with stable outlook),
 AAA and LAAA respectively for our bonds issue. These credit rating
 agencies have also assigned AAA (Highest Safety) and LAAA ratings for
 long-term borrowings.
 
 In addition to above, process of mobilization of additional loans from
 The World Bank (WB) and ADB was also taken up during the year for
 implementation of various transmission projects during XII Plan.
 Towards this, two loan agreements with ADB for a loan amount totalling
 to USD 576 million with sovereign guarantee, and also for the first
 time, a Non-Sovereign loan of USD 250 million on commercial principle
 basis was signed in March, 2012.
 
 Dividend Payout
 
 For FY 2011-12, your Company has proposed a final dividend of Rs. 1.31
 per share in addition to Rs. 0.80 per share of interim dividend paid in
 Feb. 2012. The final dividend shall be paid after your approval at the
 Annual General Meeting. Thus, total dividend pay out for the year
 amounts to Rs. 976.89 Crore (including an interim dividend of Rs. 370.39
 Crore) as against Rs. 810.23 Crore paid during the previous year. The
 total dividend pay out including dividend tax accounts for 34.8% of
 Profit after Tax of the Company.
 
 Your Company is driven by its persistent zeal to build relationships
 and create wealth for its stakeholders through deploying cutting edge
 technology, adopting global best practices, optimum utilization of
 resources and sustainable development.
 
 DIRECTORS'' RESPONSIBILITY STATEMENT
 
 As required u/s 217 (2AA) of the Companies Act, 1956, your Directors
 confirm that:
 
 i) In the preparation of the Annual Accounts, the applicable accounting
 standards have been followed;
 
 ii) The Directors have 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 and of the profit of
 the Company for that period;
 
 iii) The Directors have taken proper and sufficient care for the
 maintenance of adequate records in accordance with the provisions of
 the Act for safeguarding the assets of the Company and for preventing
 and detecting fraud and other irregularities;
 
 iv) The Directors have prepared the annual accounts on a going concern
 basis.
 
 COMMERCIAL PERFORMANCE
 
 Point of Connection (PoC) Charges tariff sharing mechanism through
 Central Electricity Regulatory Commission Regulations 2010, for Sharing
 of Transmission Charges and Losses has been implemented in the
 transmission sector w.e.f. July 1, 2011. POWERGRID as Central
 Transmission Utility (CTU) of the Country has been assigned the
 responsibility to carry out activities like raising of transmission
 charge bills on behalf of all the ISTS Licensees, collecting the amount
 and disbursing the same to them. In order to implement the Billing,
 Collection and Disbursement (BCD), a Portal has been developed by your
 Company during the year through which bills of transmission charges are
 prepared, raised and uploaded on the website for about 61 Designated
 ISTS Customers (DICs) including payment details by the customers.
 
 Through petitions and follow up with Central Electricity Regulatory
 Commission (CERC), Regulatory Approvals have been secured by your
 Company for transmission projects worth total estimated cost of about Rs.
 26,170 Crore during the year so as to take up these projects for
 investment approval and execution.
 
 DEVELOPMENT OF NATIONAL GRID
 
 In line with the Plan for enhancement of inter-regional power transfer
 capacity of the National Grid, Rourkela–Raigarh 400kV D/c,
 Sasaram–Fatehpur 765kV S/c & Gaya–Balia 765kV S/c inter-regional links
 with aggregate capacity of 5,600 MW have been commissioned. With this,
 the cumulative inter-regional power transfer capacity of National Grid
 has been enhanced to about 28,000 MW. Commissioning of these
 inter-regional links has strengthened the inter-regional grid capacity
 of Eastern Region with Western Region and Northern Region. This would
 go a long way in promoting economic energy exchange by facilitating
 transfer of power across the Country.
 
 Four major regional power grids of the country, namely Northern,
 Eastern, North-Eastern & Western continued to operate at same frequency
 in synchronous mode as one of the largest synchronous grid in the world
 with total installed capacity of about 148,000 MW. Southern Regional
 grid, which is presently connected through various High Voltage Direct
 Current (HVDC) links with rest of the grid is planned to be connected
 synchronously by early 2014 through high capacity Raichur–Sholapur
 765kV (2xS/c) lines.
 
 To further strengthen the National Grid, various high capacity HVDC and
 EHV Alternating Current (EHVAC) inter-regional links with total
 capacity of 38,400 MW have been planned to take care of inter-regional
 power transfer requirement of various planned generation projects
 including Independent Power Producers (IPPs) scheduled for
 commissioning in XII Plan. The Inter-regional power transfer capacity
 of National Grid thus envisaged to be enhanced to about 66,400 MW by
 end of XII Plan.
 
 GRID MANAGEMENT AND OPEN ACCESS
 
 Grid Management function is continued to be looked after by Power
 System Operation Corporation Limited (POSOCO), a 100% subsidiary
 company of POWERGRID. Unified Load Despatch & Communication (ULDC)
 schemes have continued to bring quality and economy in operation of
 power system besides improving data availability, visibility and
 transparency.
 
 With the ever expanding transmission network in the Country,
 complexities of grid operation are also escalating. Keeping this in
 mind, the facilities at all the five Regional Load Despatch Centers
 (RLDCs) and National Load Despatch Centre (NLDC) are being upgraded
 continuously through deployment of latest technology. Indian Power Grid
 had not experienced any major grid disturbance during the past nine
 years. However, the electricity grid experienced two major disturbances
 consecutively on 30th July & 31st July, 2012. While the first
 disturbance affected only Northern Region, the second one affected
 Northern, Eastern and North Eastern Regions. However, the essential
 loads were restored at the fastest pace within few hours of the
 incidents and power supply was restored progressively and normalised
 completely on the same day of the incident(s). Further, to avoid such
 recurrence in future, various actions have been/are being taken by your
 company.
 
 Our strong transmission network and modernised RLDCs have facilitated
 about 58 Billion Units (BUs) of inter-regional energy transfer across
 the Country, as compared to previous year (about 56 BUs). Growth of
 inter-regional power exchange helped in meeting more demand in energy
 deficit regions besides achieving overall economy.
 
 During FY 2011-12, 24,109 transactions involving about 67 BUs of energy
 were approved under short term open access (STOA) compared to 19,883
 transactions and about 55 BUs of energy during 2010-11.
 
 Your Company, as CTU is the nodal agency for grant of Long Term Access
 (LTA), Medium Term Open Access (MTOA) and Connectivity.  LTA has been
 granted for about 82,000 MW to 133 nos. of IPP projects, MTOA has been
 granted for about 2400 MW to 33 nos. of applicants and connectivity has
 been granted to 67 nos. of eligible applicants for about 59,710 MW.
 
 QUALITY MANAGEMENT
 
 Your Company is continuously striving to provide cost effective &
 quality services to its valued customers thereby deriving high customer
 satisfaction. To achieve this, your Company is implementing appropriate
 quality measures at every stage from conceptualisation of project till
 commissioning and subsequently during operational phase. Quality
 improvement techniques are being adopted to identify the areas of
 improvement and develop action Plan for continuous quality improvement
 in all of its activities.
 
 During the year, Integrated Management System of your Company was
 reviewed and based on evaluation of implementation of the latest
 systems and procedures, the revised certification was acclaimed. Your
 Company stands certified for Integrated Management System as per
 Publicly Available Specification, PAS 99:2006 integrating requirements
 of ISO 9001:2008 (Quality Management System), ISO 14001:2004
 (Environment Management System) and OHSAS 18001:2007 (Occupational
 Health & Safety Management System). Establishments of your Company have
 been audited for its Social accountability systems & certification of
 entire Corporation for Social Accountability Standard, SA 8000:2008 is
 re-confirmed. Your Company is following standard manufacturing quality
 Plan both at national & international level during inspection at
 various manufacturing stages and adhered to standard O&M manuals for
 operation & maintenance of its transmission system.
 
 For capacity building, specially considering vast geographical spread
 of our operations, vendor development has been taken-up on priority to
 meet project requirements in execution as well as in supply of 765kV
 transformers, reactors & other critical equipment.
 
 With a target to move towards zero product inspection, around 50
 manufacturing units spread all over the Country/overseas were taken-up
 for process audits at their works.
 
 Quality audits at sites have also been taken up during the year.
 Appropriate corrective actions were also ensured based on Quality Audit
 feedback. Quality Audit on implementation of Field Quality Plans was
 also carried out for assurance of quality during transportation,
 storage, erection and commissioning activities during implementation of
 projects.
 
 TECHNOLOGY DEVELOPMENT
 
 Your Company has undertaken several technological advancements aimed at
 conserving RoW, minimizing impact on natural resources & human habitat
 and cost effectiveness in evacuation of power by upgrading & uprating
 of existing transmission lines, use of High Temperature endurance
 Conductors, Series Compensation including Thyristor Control, Flexible
 AC Transmission System (FACTS), use of Multi Circuits, Compact & Tall
 Towers, Gas Insulated Sub-stations (GIS), High Surge Impedance Loading
 (HSIL) Lines, Large Scale Automation of Sub-stations, unmanned
 Sub-stations etc..
 
 Power transmission at higher voltage levels not only offer increased
 power transfer capability, it also helps in reduction of transmission
 losses and reduction of Right of Way requirement. Experienced with
 implementation and operation of ±500kV HVDC & 765kV EHVAC transmission
 systems, your Company is now working on higher transmission voltages of
  800kV HVDC & 1200kV Ultra High Voltage AC (UHVAC).
 
  800kV multi-terminal HVDC System
 
 Implementation of ±800kV, 6000 MW multi-terminal HVDC system of around
 2000 km from North Eastern Region (Biswanath Chariali in Assam and
 Alipurduar of West Bengal) to Northern Region (Agra in Uttar Pradesh)
 is under construction. It shall be amongst world''s largest ±800kV
 multi-terminal HVDC system.
 
 1200kV UHVAC Transmission System
 
 To meet the long-term bulk power transfer requirement an overlaying
 super grid with 1200kV UHVAC system has been envisaged. The 1200kV
 UHVAC technology, the highest voltage level in the world, is being
 developed by your Company in collaboration with 35 Indian
 manufacturers. This is one of the unique R&D projects in public-private
 partnership model.
 
 The pilot 1200kV S/c line was successfully test charged and 1200 kV D/c
 line erected at 1200kV UHVAC National Test Station at Bina, Madhya
 Pradesh in February, 2012 by your Company. The 1200 kV UHVAC technology
 current under field testing.
 
 This endeavour shall benefit Indian power sector to enter into new era
 of 1200kV level with 1200kV class equipment from the manufacturers
 within Country.
 
 Other Initiatives
 
 Technological initiatives such as Pollution & Lightning mapping of
 transmission system, Process bus technology & Superconducting (Zero
 Resistance) Technology are being taken up/ explored for their viability
 in Indian Power System to ensure more efficient, safe, secure &
 reliable operation of Grid.
 
 SMART GRID TECHNOLOGY
 
 Smart Grid is confluence of Information, Communications & Electrical/
 Digital technologies. Smart Grid, apart from facilitating real time
 monitoring and control of power system will help in reduction of AT&C
 losses, peak load management/ demand response, integration of renewable
 energy, power quality management, outage management etc.. Smart Grid
 will act as a backbone infrastructure to enable new business models
 like smart city, electric vehicles, smart communities apart from more
 resilient and efficient energy system and tariff structures.
 
 Your Company is taking leadership initiative for implementation of
 Smart Grid Technology in the Country and has already installed 8 Nos.
 of Phasor Measurement Units (PMUs) as part of Wide Area Measurement
 Systems (WAMS) as a pilot in Northern Region Grid.
 
 Unified Real Time Dynamic State Measurement (URTDSM) project for
 installation of PMUs, Phasor Data Concentrators (PDCs) etc. has been
 formulated. First test lab for PMU and PDC testing in India is being
 established by your Company at Bhiwadi in Northern Region.
 
 Secretariat of the prestigious India Smart Grid Task Force (ISGTF)
 forum, is being operated by your Company and providing technical
 support in evaluation of proposals. Model Request for Proposals (RfP)
 has been prepared for Smart Grid Pilot project in distribution sector.
 Further, your Company is also providing technical support for Ministry
 of Power in evaluation of proposals received from Utilities for
 establishing Pilot Project in Distribution Sector.
 
 Your Company has formed specialised Smart Grid department to take up
 implementation of Smart Grid / Smart City Projects. Detailed Project
 Report (DPR) for a number of cities like Amritsar, Raipur (Satara),
 Puducherry, Agartala, and Panipat for pilot smart grid projects have
 been submitted under India Smart Grid Task Force. Further, project
 reports for implementation of Smart grid/ cities for Firozabad and
 Katra have been submitted and for Bidhuna, Shikohabad, Jammu
 (Gandhinagar Division), Baghat, Gulmarg, Pahalgam, Charar-i-Sharief,
 Chitradurga (Karnataka), District/cities of Tripura, Chhatisgarh,
 Haryana, Punjab, Bihar etc. are under preparation.
 
 The pilot Smart grid/ Smart city project in Puducherry has been taken
 up for which an MOU has been signed with Electricity Dept., Govt. of
 Puducherry in March 2012. In all, 63 organizations have joined hands
 with your Company for implementation this pilot project.
 
 Your Company has evolved a comprehensive scheme for Green Energy
 Corridor associated with renewable energy sources integration into the
 Grid. Also, it has identified other measures to facilitate smooth
 integration of large scale renewable generation capacity addition.
 
 PERFORMANCE IN TELECOM
 
 Your Company with its brand name ''POWERTEL'' in Telecom business is the
 only utility in the Country having overhead optic fibre network using
 OPGW (Optical Ground Wire) on power transmission lines. POWERGRID has
 an all India Broad Band Telecom Network of about 25000 Kms.
 
 It is a matter of pride that your Company is one of the few telecom
 players with a marked presence in remote areas of NER, J&K etc.. It has
 acquired National Long Distance (NLD) and Internet Service Provider
 (ISP-A) and Infrastructure Provider Category-I (IP-I) licences to
 provide a variety of services.
 
 During the year, few more cities viz. Kottayam, Nadia, Puruliya,
 Jalpaigudi, Bhagalpur, Saifai & Kurukshetra have been added to our
 telecom network, taking the tally to 206 cities.
 
 During the year, your Company added 11 new customers on its network,
 further increasing its already illustrious list of Customers, which
 include prime telecom companies, prestigious Government organizations,
 International Operators and various Government Offices. In addition,
 the Company is also planning to attract customers from entertainment
 and broadcasting industry.
 
 Total Order Book of Telecom rose to Rs. 1,050 Crore from Rs. 650 Crore in
 previous year (i.e. up by 62%) despite a general slowdown experienced
 by Telecom industry due to intense price wars. Telecom Backbone system
 availability during the fiscal was maintained at 99.97%.
 
 National Knowledge Network (NKN) project
 
 Your Company is one of the implementing agencies for the prestigious
 National Knowledge Network (NKN) project through which Government plans
 to connect all knowledge centres across the Country such as IITs, IISc,
 etc. on high speed connectivity.  Revenue realised under this project
 during FY 2011-12 is Rs. 45.02 Crore.
 
 National Optical Fiber Network (NOFN) project
 
 Your Company is a member of Advisory Body and Core Committee of
 National Optical Fiber Network (NOFN) project through which Government
 of India plans to connect 250,000 Gram Panchayats on Optical Fiber
 network at an estimated cost of Rs. 20,000 Crore with completion schedule
 of 24 months, utilising existing facilities of BSNL, POWERGRID and
 RAILTEL. POWERGRID share in the project is expected to be 20% involving
 50,000 Gram Panchayats. A Pilot Project has been taken up in Vizag
 (AP).
 
 Multi Protocol Lable Switching (MPLS)
 
 Your Company has taken up implementation of MPLS through Virtual
 Private Network which will provide highly Secure & Reliable Network
 connectivity (any-to-any) on Internet Protocol (Routing). Apart from
 being cost effective, MPLS offers advantages like maximum Bandwidth
 Utilization, Scalable & Simpler Customer Connectivity (Radial
 Connectivity), easy Provisioning & Maintenance etc..
 
 BUSINESS DEVELOPMENT & CONSULTANCY
 
 Your Company has established itself as one of the leading consultants
 in the field of Power Transmission, Sub-transmission, Distribution,
 Load Despatch & Communication and Telecom sectors and is utilising this
 expertise to offer consultancy services world wide.
 
 On the domestic front, during FY 2011-12, your Company has bagged 41
 new assignments having project cost of Rs. 1002 Crore. Further, your
 Company has been appointed as Design cum Implementation Supervision
 Consultant for strengthening of Transmission & Distribution System of 6
 States of NER having Project cost of around Rs. 8400 Crore.
 
 In international arena, the Company is working in 11 countries viz.
 Nepal, Bhutan, Bangladesh, Afghanistan, Sri Lanka, Myanmar, UAE,
 Nigeria, Ethiopia, Kenya & Tajikistan.
 
 During the year, your Company signed Memorandum of Understanding (MoU)
 with Kenya Electricity Transmission Co. Ltd.  (KETRACO) and Ethiopian
 Electric Power Corporation (EEPCo) for providing assistance for
 development of Power Transmission network in their countries. In
 addition, a General Cooperation Agreement was signed with Gulf
 Cooperation Council Interconnection Authority (GCCIA) for providing
 technical services in areas of Operation and Maintenance of HVDC,
 Telecom, Grid Operations, Technical services, system planning and
 operation etc.. Further, an MoU was signed with International Finance
 Corporation (IFC), an extended arm of the World Bank, for extending
 co-operation between POWERGRID and IFC to identify and evaluate
 transmission projects for development and/or Own/Co-own transmission
 projects in Asian and African Continents by providing financial and
 technical services to Project''s client.
 
 SAARC Grid
 
 POWERGRID has emerged as a strong player in South Asia and is playing
 an active role in formation of a strong SAARC grid for effective
 utilization of resources for mutual benefits. Presently, various
 electrical interconnections exist between India & Bhutan and India &
 Nepal and these are being further strengthened for substantial exchange
 of power across the borders. An asynchronous interconnection between
 India & Bangladesh is under implementation. Also, feasibility study for
 an under-sea interconnection between India and Sri Lanka is under
 finalization and 500MW Amritsar (India) - Lahore (Pakistan) HVDC link
 between India and Pakistan is under discussion.
 
 STRATEGIC ALLIANCES
 
 Your Company intends to enter into manufacturing of transmission line
 towers/ conductors/ equipment by forming Joint Venture Companies (JVCs)
 with the manufacturers of basic raw material. In this direction, your
 Company has signed MoUs with National Aluminium Company Limited (NALCO)
 and Rashtriya Ispat Nigam Limited (RINL) to explore the opportunity of
 manufacturing conductors and transmission line towers respectively,
 including research and development.
 
 CONTRIBUTION IN DISTRIBUTION REFORMS
 
 To enable end consumers to derive benefit of additions in generation &
 transmission, Govt. of India''s Rajiv Gandhi Grameen Vidhyutikaran
 Yojana (RGGVY) Scheme aims at providing electricity in all villages &
 habitations and provides access to electricity to all rural below
 poverty line (BPL) households.
 
 Under RGGVY, your Company has been assigned the job for execution of
 rural electrification works in 65 districts in the Country.  Upto end
 of XI plan, your Company has created infrastructure for electrification
 of 64,803 villages out of which 32,318 were un- electrified villages
 and provided 33.57 lac Service Connections to BPL households.
 
 During FY 2011-12, infrastructure for electrification in 9358 villages,
 including 1688 un-electrified villages, was created and Service
 connections were provided to about 6.783 Lakh BPL households.
 
 By end of FY 2011-12 cumulatively 30,178 Villages have been charged
 including 11,229 during the year.
 
 XI PLAN ACHIEVEMENTS
 
 Your Company surpassed its planned capital investment of Rs. 55,000 Crore
 during XI Plan and made an investment of more than Rs. 55,300 Crore for
 development of inter-State transmission system.
 
 Achievements in XI Plan provide ample testimony to the untiring efforts
 put in by your Company. To propel the growth of your Company to the
 next orbit, Govt. of India has accorded the prestigious Navratna Status
 in May 2008, thereby providing greater autonomy & powers.
 
 Accelerated growth path of your Company during XI Plan can be seen from
 the following table, which shows a phenomenal built up of about 50%
 capacity of Company''s present network in XI Plan only w.r.t. the
 capacity as built in last many years.
 
 Parameter             At the
                       end of X     At the 
                                    end of XI     Addition
                                                  during XI     Growth in
                                                                XI Plan
                       Plan         Plan          Plan
 
 Transmission 
 network (ckm)          59,461       92,981        33,520         56.37%
 
 Sub-stations 
 (nos.)                    104          150            46         44.23%
 
 Transformation 
 Capacity (MVA)         59,415      124,525        65,110        109.59%
 
 Inter-regional
 Capacity (MW)          14,100       28,000        13,900         98.58%
 
 Gross Assets 
 (Rs. Crore)            29,015       63,387        34,372        118.46%
 
 During XI Plan, your Company has operationalised 765kV EHVAC level by
 charging Sipat-Seoni transmission line at its rated voltage in October,
 2007. Additionally, during the plan, seven (7) number of 765 kV
 sub-station and above 3500 ckm. of 765 kV transmission lines have been
 added. Further, the highest voltage level in the world, 1200kV UHVAC
 Test Station has been test charged.
 
 National Load Despatch Centre (NLDC), the apex body to ensure
 integrated operation of the national power system at national level,
 commissioned in Feb., 2009. Power System Operation Corporation Limited
 (POSOCO), a 100% subsidiary of your Company, set up to look after Grid
 Management function in line with GoI directive, started commercial
 operation from 1st October, 2010.
 
 As part of prestigious international consultancy assignments, the
 construction of 220kV Transmission line from Pul-e-Khumri to Kabul in
 Afghanistan completed in Jan., 2009 and 400kV GIS substation in Dubai
 (UAE) successfully commissioned in 2010.
 
 GoI has made Tariff Based Competitive Bidding (TBCB) mandatory for
 inter-State Transmission System from January 5, 2011.  Leveraging its
 competitive edge, your Company has secured both the transmission
 projects invited under TBCB since then.
 
 XII PLAN INVESTMENT PROGRAMME
 
 Considering the generation capacity addition of 75,7851 MW envisaged
 during XII Plan, total fund requirement for transmission sector is
 estimated at about Rs. 180,000 Crore. In this, major portion of the
 investment i.e. about Rs. 100,000 Crore is planned by the Company during
 XII Plan for further development of inter-State transmission systems
 which includes development of High Capacity Power Transmission
 Corridors (HCPTCs) apart from inter-regional links for enhancement of
 National Grid capacity & various system strengthening schemes.
 
 Your Company is placed in a comfortable position in terms of resource
 mobilisation owing to its excellent credit rating. Loan requirement is
 planned to be met through borrowings from multilateral funding agencies
 (The World Bank and Asian Development Bank), Supplier''s credit, ECB
 loan and from domestic sources on the basis of requirement.
 
 ERP & IT
 
 Your Company has made remarkable strides in the area of Information
 Technology (IT) and systematically developed, through in-house efforts,
 software applications for most of the functional areas for deploying IT
 for efficient and effective discharge of its objectives. Laptops and
 datacards have been provided to employees to enable them to discharge
 their functions efficiently.
 
 Main package of ERP Project has been awarded. The project includes
 deployment of Data Centre, Disaster Recovery Centre and augmentation of
 communication network.
 
 Initiative towards implementation of Information Security Management
 System (ISMS) leading to ISO:27001 certification across the
 organization have been undertaken.
 
 SUSTAINABLE DEVELOPMENT
 
 Transmission projects are environmentally clean and involve neither any
 disposal of solid waste, effluents and hazardous substances in land,
 air and water nor large scale excavation which may result in soil
 erosion. Transmission line projects rather help in reducing
 environmental impacts of power projects, especially thermal power
 projects. Generation Projects could be located far away from inhabited
 areas to have minimum transportation of coal and for bulk power
 transfer, high capacity transmission lines are set-up to dispatch power
 to load centre located distance apart.
 
 Your Company has proactively followed the Environmental and Social
 Policy & Procedures (ESPP) for the conservation of forests, flora &
 fauna, resettlement & rehabilitation. POWERGRID believes that its
 guiding principles of Reliability, Security and Economy have to match
 up to the rising expectations of a cleaner, safer, healthier
 environment for people, both affected and benefited by its activities.
 After adoption of ESPP, forest involvement on our transmission lines
 have been reduced to 1.35% from the level of 6% in 1998.
 
 POWERGRID was the first Company in power sector to come out with
 ''Sustainability Report'' and 2nd such report shall be coming out
 shortly, providing all stakeholders a clear picture of our
 contributions to sustainable development through its activities.
 
 POWERGRID has undertaken Rain Water Harvesting systems in 6
 Sub-stations with total expenditure of Rs. 25.75 lakhs as part of the
 Company''s Sustainable Development initiative to contribute to the
 endurance of our ground water reserves.
 
 Transfer of huge quantum of power across the regions poses massive
 challenges like RoW, clearing of forest, etc.. Therefore, your Company
 is focusing on more number of high capacity  800kV HVDC systems and
 765kV D/c lines to minimise RoW and environmental problems. In
 addition, as mentioned your Company is developing 1200kV AC technology,
 highest AC voltage level in the world, as next higher AC voltage in the
 Country. The 1200kV AC voltage line would enable transfer of 7000-8000
 MW power over single corridor which will help in utilizing the
 right-of-way in an optimal manner and minimizing of loss of forest,
 flora & fauna and scarce natural resource like land etc..
 
 Besides, your Company has successfully demonstrated up-gradation of
 existing lower voltage lines to higher voltage operation to enhance the
 power transmission capacity within the same corridor without felling
 additional trees.
 
 Optimization of RoW and its associated environmental and social impact
 in extra high voltage transmission line are far reaching and
 implementation of this voltage/ technology will go a long way in
 minimizing environmental and social impact of high voltage transmission
 line.
 
 For overall sustainable development of the sector, your company''s major
 thrust is on inclusive development of the sector.  Towards this, your
 company besides undertaking capacity building program for various State
 power utilities, is in the process of forming Joint Venture Companies
 with State power utilities to take up intra-State transmission System &
 management contract for distribution circles etc.
 
 As a step further a specalised dedicated Smart Grid, Distribution
 Management, Energy Efficiency and Carbon Emmission reduction Cells have
 been created to take up these activities not only for POWERGRID
 establishment but for other utilities as well.  Certification of our
 employees as Energy Auditor is being taken up in big way. During the
 year, Energy audit was completed at 12 sub-stations and reports have
 been implemented.
 
 CORPORATE SOCIAL RESPONSIBILITY
 
 Your Company emphasises on the overall development of areas and
 communities around its establishments. It undertakes various community
 development schemes through provision of facilities like health,
 education, drinking water besides infrastructure like roads, community
 centres etc..
 
 During FY 2011-12, CSR expenditure of Rs. 24.93 Crore [0.92% of Profit
 after tax (PAT) of the preceding year] was made on carrying out more
 than 400 CSR projects, including 166 in the area of Infrastructure, 82
 in Health, 57 in Education, 33 in Environment and 40 in Livelihood.
 These projects were carried out in consultation with the local
 stakeholders in the vicinity of the establishments, and therefore, have
 played a pivotal role in identifying the most pressing needs, and
 subsequently, improving the socio-economic conditions of the
 marginalized sections. During this period, more than 1.55 lakh tree
 saplings were also planted. There is an ambitious plan of planting over
 one million trees in the coming years.
 
 Your Company has also collaborated with number of specialized agencies
 to roll out its CSR initiatives. Some of the significant interventions
 were in the field of Capacity building training to youths in
 Transmission Line Tower erection which are being conducted in
 association with leading manufacturers. During this year, 213 unskilled
 workers have been trained through Capacity Building Programme and
 gainfully employed in the transmission industry. Livelihood training
 programmes were also imparted to unemployed rural youth in tailoring,
 cutting/ stitching, embroidery, automobile repairing, handloom weaving,
 food & fruit processing, repairing of household appliances, etc. to
 secure employment or be self employed. Your Company has adopted
 Government ITIs at Buxar&Marhoura in Bihar, Bargi-Jabalpur in M.P. and
 Bhadravati in Maharashtra for upgradation under Public Private
 Partnership mode of Adopt an ITI scheme of GOI. Total about 500
 students have passed out from these institutions in various trade such
 as moulding, welding, plumbing, electrical, mechanical etc. Further
 your company is in the process of setting up of two (2) new ITIs each
 in the States of J & K and Odisha for enhancing the capacity building
 of the sector as well as employablity of the youth of our country.
 
 Some of the other noteworthy CSR initiatives include reclamation of
 Reserve Forest in Assam wherein tree saplings were planted in 100
 hectares of land, providing mid-day meals to primary students in
 Haryana, providing Maternal & Child Health care services to around
 45,000 villagers in backward areas of Mewat, Jhajjar & Gurgaon and
 providing broadband connectivity to few remote village panchayats in
 Maharashtra, Odisha & Assam.
 
 PEOPLE, OUR CORE STRENGTH
 
 Attracting Talent, Nurturing & Development of Human Capital Our
 employees & their continuous development are the most valuable asset &
 investment of the Company. Your Company encourage innovation,
 meritocracy and the pursuit of excellence through continuous
 development. In this direction, your company is setting up a
 state-of-the-art HRD centre at Manesar named POWERGRID Academy of
 Leadership (PAL) at an estimated cost of over Rs. 55 crore for
 development of the employees of POWEGRID as well as that of State
 utilities.
 
 During FY 2011-12, POWERGRID has inducted 394 personnel at various
 levels viz., Executives, Supervisors, Workmen through open
 advertisement on all India basis and campus selection from reputed
 engineering and management institutes for executives, and for
 non-executives through employment exchanges and local advertisement at
 regional level.
 
 For overall competency enhancement of employees in synchronization with
 business needs, environment and individual development Plan, your
 Company has boosted up its training efforts and an average 6.15
 training mandays per employee has been achieved.
 
 A centre for training on maintenance of live high voltage lines of up
 to 400kV has been established at Hyderabad 400kV sub-station. The
 state-of-the-art facility has been recognised as Category-I training
 centre in power sector by Central Electricity Authority for imparting
 training in Hot Line Maintenance on the live power transmission lines.
 
 MoUs have been signed with Foundation of Innovation and Technology
 Transfer of IIT, Delhi (FITT, IIT Delhi) for conducting certification
 programmes for operation & maintenance of transmission system and
 telecom.
 
 Corporate Yellow Pages of your Company have been collated to cope with
 the competitive regime. In fact, with the arrival of Knowledge economy,
 your Company is rising up to manage the knowledge assets, share, use,
 re-use, capitalize them and remain ahead of the competition.
 
 Project management is the value driver that helps the organization gets
 most out of its performance. In view of the organisational need, 46
 executives got the Certification in Project Management from
 international bodies.
 
 Employee Welfare
 
 Keeping in pace with changing needs and welfare of employees, various
 policies and rules are being revised/ amended from time to time.
 Various hospitals adjacent to our establishments have been empanelled
 both at Corporate Centre as well as in other establishments for benefit
 of Employees and their dependents. The Cafeteria in the Corporate
 Office and Food Lounge of Multi Purpose hall of your Company is
 conferred with ISO 22000: 2005 where quality food is served to
 employees.
 
 Cultural programmes are conducted periodically for promoting healthy
 community living and celebrating various occasions like Diwali
 get-together, Holi Milan, New Year, Raising Day, etc..
 
 The Company has also been organizing Intra & Inter-Regional Sports
 Competitions for Kabaddi, Cricket, Volleyball, Chess, Badminton etc.
 and regularly participating in the Inter-PSU Sports Meet. POWERGRID
 players in Kabaddi, Table tennis and Lawn- Tennis have stood
 meritorious and bagged awards in the Inter-PSU tournaments. Your
 Company''s team has emerged as National Champions in prestigious
 National Management Games-2012, organised by All India Management
 Association and qualified to represent India in Asian Management Games
 Challenge.
 
 POWERGRID National & Regional Bipartite Committees provides a platform
 for addressing issues related to workmen. During the year, the
 Industrial Relations have been maintained cordial and no manday was
 lost.
 
 Citizen''s Charter
 
 The Company formulated its Citizen''s Charter providing a visible front
 of its mission & objectives, commitments, terms of service and its
 obligation to various stakeholders. In the Citizen''s Charter
 information is available about Company''s schemes, policies, project
 plans of the Corporation and issues of general interest to
 stakeholders.
 
 Implementation of Official Language
 
 Your Company has proven its commitment for implementation of Rajbhasha
 Policy of Govt. of India and is sensitive towards our heritage, social
 and cultural concerns.
 
 All out efforts have been made to ensure use of Hindi in all aspects of
 management at all levels in the Corporation. For increased use of
 Official language, various activities were undertaken such as
 organizing workshops to impart training in translation, enhancing
 working knowledge through organizing computer trainings and Hindi
 classes, etc.. Akhil Bhartiya Rajbhasha Sammelan, Kavi Sammelan (poetry
 sessions), Kavita Pratiyogita, Drama, Publication of Hindi Magazines/
 papers, competitions and meetings, etc. are regularly organized. To
 provide further inspiration to work in Hindi, employees are nominated
 for external Hindi training programmes. The efforts made in
 implementation of Rajbasha have been applauded in many forums and the
 Company has received many accolades.
 
 Corporate Image through Communication Management
 
 Building Communication Capital is as important as Human Capital to
 build relation between organisation and its stakeholders.  Your Company
 has adopted a number of communication interventions to present itself
 as an infrastructure major contributing to nation building.
 
 In order to facilitate dissemination of information and interaction
 with all stakeholders with regard to our achievements, growth, recent
 developments on operational and financial front besides updation of
 website, regular press communiqué have been issued by your Company and
 face to face interaction of the management arranged with the analysts
 and stakeholders at the Quarterly Analyst Meet and Press Meet. This has
 enhanced brand exposure with existing and potential clients, investors
 and other stakeholders. Information and latest updates & announcements
 regarding the Company are posted on Company''s website including
 Financial results, approval to projects granted by the Board etc..
 
 Your Company successfully participated in the India International Trade
 Fair (IITF) 2011 exhibition by creating a theme stall based on 1200kV
 UHVAC transmission line. The Company also participated in other
 business oriented regional exhibitions in Jharkhand, Mumbai and other
 places to reach out to local clients and the common masses.
 
 Internal communications play a key role in enabling employees across
 the Company in understanding and embracing the Company''s mission, goals
 and strategies. Towards this objective, your Company has continuously
 deployed communication tools such as monthly newsletters, CMD''s
 communique, house journals, wall magazines, lounge and regular media
 updates to apprise the employees of the developments, achievements &
 events, viewpoints of the management and also provide a platform to
 employees to participate and take pride in being associated with
 POWERGRID. Open house sessions are also regularly organised where CMD
 and Directors of your Company interact with all the employees, either
 directly or through video conferencing.
 
 EXHIBITION AND CONFERENCE ON NEW TECHNOLOGIES - GRIDTECH 2011
 
 With the support of Ministry of Power, Govt. of India, GRIDTECH 2011,
 an International exhibition and conference on new technologies in
 transmission & distribution and synergic areas like load despatch,
 telecommunications, application software etc. was organised. GRIDTECH
 2011 provided a unique opportunity for the power utilities,
 manufacturers, research institutions, policy makers, academicians,
 consultants etc. to gain exposure to state-of-the-art products and
 technologies like 1200kV UHVAC, 800kV HVDC, FACTS, GIS,
 Superconductors, Smart Grid, substation automation, compact lines,
 power system protection system, modern distribution management,
 renewable energy sources, integrated communication system etc..
 
 RENEWED COMMITMENT TO TRANSPARENCY & VIGILANCE FUNCTION
 
 Several initiatives have been taken to strengthen internal systems to
 enhance efficiency and effectiveness of the Vigilance function. The
 Vigilance Department lays emphasis in the awareness process. In line
 with this, training has been imparted on ethics and vigilance matters
 through various preventive vigilance workshops. Apart from these,
 vigilance executives were also sent on training to various
 organizations like Central Bureau of Investigation (CBI) and the
 National Institute of Criminology and Forensic Science, besides
 participating in training programmes organized for capacity enrichment
 of the vigilance executives. The Vigilance Executives at the regions
 also undertook regular knowledge enhancement sessions while on tour or
 inspections, which gave a feedback on the practical issues being faced
 by personnel at the execution level. Besides these, Vigilance Audit of
 some of the Departments has also been conducted, which is aimed at
 examining the primary objectives of a Unit/ Department and impact
 assessment in terms of achievement of these primary objectives. It
 brings out the extent of risk, irregularities, mistakes & omissions
 under various provisions of the rules, and also examines whether there
 are any lacunae in the system/ rules and its application leading to the
 said defects. On assessment of these, remedial measures have been
 suggested.
 
 As part of pro-active vigilance, process online inspections have also
 been conducted in which critical works are inspected at the initial
 stage of execution by the vigilance executive for shortcomings and for
 advising corrective measures at the initial time, if any. As a result
 of Vigilance audit, large number of system improvements were
 implemented which include standard Field Quality Plan, safety norms,
 Project Insurance Policy, maintaining proper storage, construction
 related records, Qualifying Requirements on procurement, HR Policies
 etc.. A large number of inspections have been conducted both by
 Vigilance executives as well as by the CTE''s Organisation. Based on
 these inspections, adequate cost compensation was effected on the
 points for not conforming to technical specifications etc.. To
 facilitate report generation & compliance on inspection reports
 generated through the Vigilance Inspection System (VINS), a system has
 been devised for furnishing online replies on the internet. On the
 punitive side, a number of complaints were received and taken up for
 investigation. Necessary disciplinary action wherever appropriate was
 also initiated against some employees.
 
 While e-payments, document tracking, uploading of contractual
 documents, web based complaint handling system has already been
 implemented in the Organisation from 2007 onwards, lately,
 e-procurement has been successfully implemented in the Organisation
 with the signing of Contract Agreement with two leading Application
 Service Providers (ASP), viz. M/s Telecommunications Consultants India
 Limited (TCIL) & M/s m junction services Limited (mjunction). Further,
 provision of e-Reverse auction has also been included in the
 agreements.
 
 To spread awareness amongst employees and to prevent violation of the
 Conduct, Discipline & Appeal (CDA) Rules, bulk SMS on the CDA Rules are
 being sent to all the employees regularly. Vigilance Department also
 uploaded CDA Rules Quiz, the Public Interest Disclosure and Protection
 of Informers (PIDPI) Resolution of CVC, Case studies and closed
 inspection reports on the intranet website. During the Vigilance
 Awareness Week from 31st October to 4th November, 2011 the theme of the
 year Participative Vigilance as decided by Central Vigilance
 Commission was celebrated in befitting manner by administering the
 pledge to all employees as well as through several competitions and
 programmes which included painting and debate competitions for the
 employees, their children and outside schools children. Lectures by
 eminent personalities on topics related to corruption, ethics and
 values were organized at different installations of the Corporation.
 The in-house journal of the Vigilance Department – Candour was
 released during the valedictory function of the Vigilance Awareness
 Week by the Chief Guest, Shri Anil Kumar Sinha, IPS, Addl. Secretary,
 Central Vigilance Commission. He also gave away prizes to the prize
 winners on the occasion.
 
 ACCOLADES & AWARDS
 
 Your Company has been bestowed with numerous awards in various
 categories by Govt. of India and other prestigious organisations &
 institutes.
 
 Six projects of POWERGRID bagged the prestigious National Awards for
 Meritorious Performance in Power Sector instituted by the Government of
 India for the year 2009-10 & 2010-11. POWERGRID received three Gold
 Shields and two Silver Shields for Transmission System Availability and
 one Silver Shield for Early Completion of Transmission Project.
 
 In recognition of its continued efforts to provide secure & reliable
 transmission system, POWERGRID was conferred with ''Power Line Awards
 2012'' in the category Best Performing Transmission Company.
 
 ''Environmental Excellence & Sustainable Development award-2011'' by the
 Indian Chamber of Commerce and ''4th India Power Awards 2011'' under the
 ''Largest CPU in Transmission Sector'' and ''Overall Utility Performance-
 Transmission'' Categories were conferred on your Company for its
 outstanding performance.
 
 In Telecom Business, as a testimony of the excellent work being done by
 your Company, it has been bestowed with Excellence in Innovation in
 Tower Management Award by INFOCOM CMAI National Telecom Awards 2011.
 
 MANAGEMENT DISCUSSION AND ANALYSIS
 
 In addition to the issues in the Directors reports, some issues have
 been brought out in report on Management Discussion and Analysis placed
 at Annexure-I.
 
 PARTICULARS OF EMPLOYEES
 
 The particulars of employees of the Corporation who were in receipt of
 remuneration in excess of the limit prescribed under Section 217 (2A)
 of the Companies Act, 1956 is given in Annexure-II to this Report.
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
 EARNINGS AND OUTGO
 
 As per requirements of disclosures under Section 217(1) (e) of
 Companies Act,1956 read with Rule 2 of the Companies (Disclosures of
 Particulars in the Report of Board of Directors) Rules, 1988
 information relating to conservation of energy, technology absorption
 and foreign exchange earnings and outgo, information is given in
 Annexure-III to this Report.
 
 COMPTROLLER AND AUDITOR GENERAL''S COMMENTS
 
 Company has received ''NIL'' comments on the accounts for the year ended
 31st March, 2012 by the Comptroller and Auditor General of India under
 Section 619(4) of the Companies Act, 1956. Copy is attached in
 Annexure-IV to this report.
 
 CORPORATE GOVERNANCE
 
 A report on the Corporate Governance (Annexure V), forming part of this
 report, together with the Certificate thereon is given in Annexure-VI
 to this report.
 
 Your Company has got its Secretarial Compliance Audit conducted for the
 financial year ended 31st March, 2012 from M/s Sanjay Grover &
 Associates, Practising Company Secretaries. Their Report forms part of
 this Report. (Annexure-VII)
 
 STATUTORY AUDITORS OF THE COMPANY
 
 The Statutory Auditors of your Company are appointed by the Comptroller
 & Auditor General of India. M/s S. K. Mehta & Co., M/s Chatterjee &
 Co., and M/s Sagar & Associates were appointed as Joint Statutory
 Auditors for the financial year 2011-12.
 
 COST AUDITORS OF THE COMPANY
 
 POWERGRID had appointed the Cost Auditors Sh. Jugal Kishore Puri, M/s.
 Chandra Wadhwa & Co, M/s. S. C. Mohanty & Associates and M/s. K. G.
 Goyal and Associates under Section 233B of the Companies Act, 1956 for
 the Financial Year 2011-12.
 
 The due date for filing Cost Audit Reports for the financial year
 2011-12 with the Cost Audit Branch, Ministry of Company Affairs is
 September 30, 2012 and the same will be filed with the Cost Audit
 Branch within the stipulated time.
 
 POWERGRID''S BOARD
 
 During the year, Shri R. N. Nayak who was our Director (Operations)
 took over the charge of Chairman & Managing Director with effect from
 1st September, 2011.
 
 Shri R. T. Agarwal assumed the charge of Director (Finance) with effect
 from July 29, 2011. Smt. Rita Acharya, Jt. Secy, MoP joined the Board
 of the company w.e.f. August 26, 2011 in place of Dr. M. Ravi Kanth Jt.
 Secy. (Trans.), MoP, who ceased to be Director on Board of the company
 w.e.f. August 16, 2011. Further, Shri Santosh Saraf and Smt. Rita Sinha
 joined the Board as non-official part time directors w.e.f. December
 27, 2011.
 
 Shri S. K. Chaturvedi demitted the office as Chairman & Managing
 Director on 31st August, 2011 upon attaining superannuation.  Shri V.
 M. Kaul, Director (Personnel) superannuated on March 31, 2012 and
 ceased to be Director on the Board of POWERGRID.  The tenure of - two
 non-official part-time Directors - Shri Ashok Khanna and Shri S.C.
 Tripathi came to an end on April 24, 2011; four non-official Part-time
 Directors - Dr. P. K. Shetty, Prof. A. S. Narag, Shri Anil K. Agarwal
 and Shri F. A. Vandrevala came to an end on July 9, 2011 and that of
 Mrs. Sarita Prasad, non-official part time Director came to an end on
 August 3, 2011 and they ceased to be Director.
 
 The Board wishes to place on record its deep appreciation and gratitude
 for the invaluable contribution and unstinted support to the Company
 extended by these directors.
 
 Shri Ravi P. Singh assumed the Charge of Director (Personnel) with
 effect from April 1, 2012. Shri R. P. Sasmal has been appointed as
 Director (Operations) with effect from August 1, 2012.
 
 In accordance with the provisions of Section 255 and 256 of the
 Companies Act, 1956 read with Article 31 (iii) of the Articles of
 Association of the Company, Shri I. S. Jha, Director (Projects), Shri
 R. T. Agarwal, Director (Finance) and Smt. Rita Acharya, Director shall
 retire by rotation at the Annual General Meeting of your Company and
 being eligible, offer themselves for re-appointment.
 
 ACKNOWLEDGEMENTS
 
 The Board of Directors, with deep sense of appreciation, acknowledges
 the guidance and co-operation received from Govt.  of India,
 particularly Ministry of Power, Ministry of Finance, Ministry of Home
 Affairs, Ministry of External Affairs, Ministry of Statistics and
 Programme Implementation, Ministry of Environment & Forests, Central
 Electricity Regulatory Commission, Appellate Tribunal for Electricity,
 Central Electricity Authority, Planning Commission, Department of
 Public Enterprises, Regional Power Committees, and other concerned
 Govt. departments/agencies at the Central and State level as well as
 from Securities and Exchange Board of India, National Stock Exchange of
 India Ltd., and Bombay Stock Exchange Ltd., Mumbai without whose active
 support, the achievements by the Corporation during the year under
 review would not have been possible.
 
 Board''s special appreciation and thanks are due to our valued
 customers, various State power utilities and other clients, who have
 awarded various consultancy works and reposed faith in Company''s
 capability to handle them. The Board also appreciates the contribution
 of contractors, vendors and consultants for successful implementation
 of various projects by the Company.
 
 The Directors take this opportunity to thank the Principal Director of
 Commercial Audit and Ex-Officio Member Audit Board-III for the
 cooperation during the year. Directors also acknowledge the valuable
 suggestions and guidance received from the statutory auditors during
 the audit of accounts of the Company for the year under review. The
 Board also conveys its sincere thanks to various national/international
 financial institutions/ banks/ credit rating agencies for their timely
 assistance, continued trust and confidence reposed by them on
 POWERGRID.
 
 We have achieved a great deal this year and none of it would have been
 possible without the skills and dedication of each member of POWERGRID
 family at all levels. I would like to thank the Executive team for its
 strong leadership, the various employee unions to ensure that the
 company continues to achieve greater heights year after year and all
 our employees for their commitment and enthusiasm to achieve our aim to
 be the world''s premier transmission network utility.  ~
 
 For and on behalf of the Board of Directors
 
 Place:  New Delhi                                   (R. N. Nayak)
 
 Date : 09.08.2012                   Chairman & Managing Director