Dear Shareholders,
 
 The Directors have pleasure in presenting the 46th Annual Report of
 the Company together with the Audited Accounts for the year ended 31st
 March 2011.
 
 Performance / Financial Results 
 
                                                     (Rupees in Lakhs)
 
 PARTICULARS                  STANDALONE             CONSOLIDATED
                          2010-2011   2009-2010   2010-2011    2009-2010
 
 Income from Operations     7360.99     6424.30    10965.94      9754.29
 
 Profit before interest, 
 depreciation and tax       3409.56     2915.00     4069.78      3577.23
 
 Interest                   2205.87     1755.02     2327.03      1955.56
 
 Depreciation               1306.68     1148.87     1450.57      1292.26
 
 Provision for Tax & 
 Deferred Tax                125.71      148.02      212.61       212.44
 
 Profit after Tax          (228.70)     (136.90)      79.57       116.97
 
 Balance carried to
 Balance Sheet             1419.50      1648.19     2464.68      2385.12
 
 Dividend
 
 The Board does not recommend any dividend for the financial year.
 
 Hiving-off Bangalore Project Division''
 
 Your Directors have pleasure to inform you that the Company has
 successfully completed the hiving-off of ‘Bangalore Project Division''
 to Viceroy Bangalore Hotels Private Limited on July 27, 2011 and your
 Company has been allotted 59,90,000 equity shares of Rs.10/- each at a
 price of Rs.78.96/- per share as a part consideration for the sale of
 the said Division. Your Directors also have pleasure to inform you that
 JPMorgan India Property Mauritius Company II has infused a strategic
 investment of Rs.74 Crores as a first trench out of Rs.90 Crores by
 subscribing 74,00,000 equity shares of Rs.10/- each at a price of
 Rs.100/- per share in the equity share capital of Viceroy Bangalore
 Hotels Private Limited. Consequent to which Viceroy Bangalore Hotels
 Private Limited ceased to be Subsidiary of your Company with effect
 from July 28, 2011 and will continue as an Associate Company. The Board
 is also pleased to inform you that the construction of Bangalore
 ‘Renaissance'' a 277 Room Five Star Deluxe Hotel is in advanced stage
 and expected to be operational in 2012.
 
 Hiving-off ‘Chennai Project Division''
 
 Considering the various aspects and strategic viewpoint, the Board of
 Directors of your Company felt that it would be prudent to divest
 ‘Chennai Project Division'' comprising ‘Chennai Hotel Project'' and
 ‘Chennai Residential Project'' to pay-off its debts substantially as
 well as utilize in the growth of the business of your Company and
 accordingly the Shareholders of the Company have accorded their consent
 by way of postal ballot conducted on June 03, 2011 for hiving-off the
 said Project on slump sale basis as going concern and the said slump
 sale is expected to be completed in the FY 2011-2012. This will not
 only result in reduction of debt to the tune of Rs.450 Cr. but also
 will give Rs.100 Cr. of inflows into the Company.
 
 Directors
 
 The Board of Directors regret to inform about sudden demise of Mr. P.
 Shivakumar Reddy on February 23, 2011 and the Board recorded its
 gratitude and deep condolence in this regard.
 
 Mr. K. Narasimha Rao and Mr. A. Poornachandra Rao retire by rotation
 and being eligible, offered themselves for re-appointment and brief
 particulars of these persons, are given in the Explanatory Statement to
 the Notice of this Meeting. The Board commends their re-appointment as
 Directors of the Company.
 
 Directors'' Responsibility Statement
 
 In pursuance of Section 217(2AA) of the Companies Amendment Act, 2000
 your directors confirm
 
 i) That the directors in the preparation of the annual accounts the
 applicable accounting standards have been followed along with proper
 explanations relating to material departures.
 
 ii) That 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.
 
 iii) That the directors had taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of this Act for safe guarding the assets of the company and
 for preventing and detecting fraud and other irregularities.
 
 iv) That the directors had prepared the annual accounts on the going
 concern basis.
 
 Auditors
 
 M/s. P. Murali & Co., Chartered Accountants, Hyderabad, the present
 auditors of the Company, retire at the forthcoming Annual General
 Meeting and are eligible for re-appointment as auditors. Members are
 requested to re-appoint them and fix their remuneration. The Company
 has received confirmation from the firm to the effect that their
 reappointment, if made, would be within the prescribed limits under
 Section 224(1B) of the Companies Act, 1956 and they are not
 disqualified for re-appointment within the meaning of Section 226 of
 the said Act. The Audit Committee of the Board has recommended their
 re-appointment.
 
 Particulars of Employees
 
 No employee was in receipt of remuneration exceeding the limits
 prescribed under section 217(2A) of the Companies Act, 1956 and the
 rules framed there under, as amended to date.
 
 Information required under Section 217 (1) (e) of the Companies Act
 1956 read with the Companies (Disclosure of Particulars in the report
 of Board of Directors) Rules, 1988
 
 Your Company''s effort towards conservation of energy, which results in
 savings in consumption of electricity, a significant component of the
 energy cost, is an ongoing process. The Company continues to absorb and
 upgrade modern technologies and advanced hotel management techniques in
 various guest contact areas, which include wireless internet
 connectivity in the hotels.
 
 As required under Section 217(1) (e) of the Companies Act, 1956, read
 with rule 2 of the Companies (Disclosure of Particulars in the Report
 of Board of Directors) Rules, 1988, the information relating to foreign
 exchange earnings and outgo is in item nos 8,9 & 10 of Notes to
 Accounts of the Balance Sheet and Profit and Loss Account.
 
 Compliance with Notification No. S.O. 301(E) dated 8th February, 2011
 issued by the Ministry of Corporate Affairs under Section 211(3) of the
 Companies Act, 1956
 
 Since Central Government had issued a notification No. S.O. 301 (E)
 dated 8th February, 2011 in exercise of the powers conferred by Section
 211 (3) of the Companies Act, 1956 granting general exemption to some
 specified class of companies, including hotel companies, from
 disclosing certain information in their profit and loss account as
 required under Part-II of Schedule VI of the Companies Act, 1956
 subject to fulfilment of few conditions, your Company has duly complied
 with all conditions of the notification to seek general exemption under
 Section 211 (4) of the Companies Act, 1956, paras 3(i)(a) and 3(ii)(d)
 of Part II of Schedule VI of the
 
 Companies Act, 1956 dealing with the disclosure of quantitative details
 of turnover of each class of goods, opening and closing stock,
 purchases, production and consumption of raw material in the financial
 statements for the financial year ended 31st March, 2011. Your Board
 has passed necessary resolution at its meeting held on August 13, 2011
 to comply with the conditions of the notification for the same.
 
 Public Deposits
 
 During the year under review, your company has neither invited nor
 accepted any deposits from the public.
 
 Listing
 
 The Equity Shares of your Company are listed on Bombay Stock Exchange
 Limited and the National Stock Exchange of India Limited. It may be
 noted that there are no payments outstanding to the Stock Exchanges by
 way of Listing Fees, etc.
 
 Corporate Governance
 
 The company has taken adequate steps to ensure that the conditions of
 corporate governance as stipulated in clause 49 of the listing
 agreement of the stock exchange are complied with. A separate statement
 on corporate governance together with the auditor''s certificate of its
 compliance forms part of this annual report.
 
 Management Discussion & Analysis
 
 Management discussion and analysis of the financial condition and
 results of operations of the Company for the period under review as
 required under Clause 49 of the Listing Agreement with the Stock
 Exchanges, is given in a separate statement in the Annual Report.
 
 Employee Relations
 
 The relationship with the employees continues to be cordial. The
 Directors would like to place on record their appreciation of the
 services rendered by all the employees of the Company.
 
 Subsidiaries
 
 Viceroy Bangalore Hotels Private Limited:
 
 During the financial year under review, your Company has entered into a
 Business Transfer Agreement (BTA) with its wholly owned subsidiary
 namely Viceroy Bangalore Hotels Private Limited'' for transfer of
 ‘Bangalore Project Division'' on slump sale basis as a going concern.
 Accordingly, your Company has transferred the said Division on July 27,
 2011 and as a part consideration the said Company has allotted
 59,90,000 equity shares of Rs.10/- each at a price of Rs.78.96/- per
 share.
 
 Your Directors also have pleasure to inform you that JPMorgan India
 Property Mauritius Company II has infused a strategic investment of
 Rs.74 Crores as a first trench out of Rs.90 Crores by subscribing
 74,00,000 equity shares of Rs.10/- each at a price of Rs.100/- per
 share in the equity share capital of Viceroy Bangalore Hotels Private
 Limited. Consequent to which Viceroy Bangalore Hotels Private Limited
 ceased to be Subsidiary of your Company and will continue as an
 associate company with effect from July 28, 2011.
 
 Currently, Viceroy Bangalore Hotels Private Limited is establishing and
 developing a 277 Room First Class business hotel to be branded as
 Renaissance at Race Course Loop Lane, Bangalore.
 
 Viceroy Chennai Hotels & Resorts Private Limited:
 
 During the financial year under review your Company has incorporated on
 June 04, 2010 a wholly owned subsidiary namely Viceroy Chennai Hotels &
 Resorts Private Limited'' and there were no operations commenced as on
 date.
 
 Minerva Hospitalities Private Limited:
 
 Minerva Hospitalities Private Limited has no operations during the
 year.
 
 CafE D Lake Private Limited:
 
 CafE D''Lake Private Limited which operates all the restaurants
 businesses of Minerva Coffee-shop, Blue Fox Bar & Restaurant, Eat
 Street and Water Front has achieved a turnover of Rs. 29.90 Crores for
 the year ended 31st March 2011 as against Rs.28 Crores for the previous
 year. The Net profit for the year ended 31st March 2011 is Rs.2.85
 Crores as against Rs.2.82 Crores.
 
 Crustum Products Private Limited:
 
 Crustum Products Private Limited is the Master Franchisee of Breadtalk
 Singapore. The Company is running out lets at In Orbit Mall, Malad,
 Mumbai, BG House, Hiranandani, Powai, Mumbai, Gurgoan, New Delhi,
 Spencer''s Mall, Bangalore Q Mart- Hyderabad.
 
 During the year under review, the company achieved a turnover of
 Rs.6.14 Crores as against Rs.5.30 Crores for the previous year. The Net
 profit for the year ended 31st March 2011 is Rs.23.26 Lakhs as against
 net loss of Rs.28.16 Lakhs.
 
 In terms of section 212 of the Companies Act, 1956, your Company is
 required to attach the directors report, balance sheets, profit and
 loss account of its subsidiary companies to its Annual Report. However,
 the Ministry of Corporate Affairs (MCA), Government of India, New Delhi
 vide its Circular No.2/2011, dated: 08-02-2011 has granted a general
 exemption to all the Companies for not attaching the above documents of
 subsidiaries with the Annual Report of the Holding Company, subject to
 compliance of the conditions specified therein. As required under the
 said general circular, the Board of Directors of your Company at its
 meeting held on August 13, 2011 has given its specific consent for not
 attaching the balance sheets of its subsidiaries, as they would be made
 available to its members at the company''s website.
 
 In terms of the said notification of the MCA, a summary of the
 financial information of each of the subsidiaries of your Company is
 provided as Annexure A to this report. Any member intends to have a
 certified copy of the Balance Sheet and other financial statements of
 these subsidiaries may write to the Company. Accordingly, this annual
 report does not contain the reports and other statements of the
 subsidiary companies. These documents will also be available for
 inspection during the business hours at the registered office of the
 company and also at the registered offices of the respective subsidiary
 companies.
 
 Acknowledgements
 
 Your Directors acknowledge with gratitude and wish to place on record
 their sincere thanks and appreciation for the co-operation received by
 the Company from various Departments of Central/ State Government,
 Financial Institutions and Banks for their continued co-operation and
 the support extended during the year. Your Directors also wish to
 acknowledge the continued support and confidence reposed in the
 management by the Shareholders.
 
                                  By Order and on behalf of the Board
 
 Hyderabad 
 
 August 13, 2011                                                 SD/-
                                                   P. PRABHAKAR REDDY
                                                             CHAIRMAN