1

Highlights 2009-10

• Orderbookincreasesby15%toRs.18,810crore

• NewordersworthRs.5,748crorereceivedduringtheyear

• Turnoverimprovesby10%toRs.3,863crore

• LavasapoststurnoverofRs.482croreandPATofRs.140crore

• HCCInfrastructureassetportfolioexpandstoRs.5,539crore

Contents

CHAIRMAN’S LETTER ..................................................................................................... 4

COMPANY INFORMATION .............................................................................................. 6

MANAGEMENT DISCUSSION AND ANALYSIS ............................................................ 8

CORPORATE GOVERNANCE ........................................................................................ 23

SHAREHOLDER'S INFORMATION ................................................................................ 34

NOTICE ............................................................................................................................ 41

DIRECTORS’ REPORT .................................................................................................... 46

AUDITORS’ REPORT ...................................................................................................... 59

FINANCIALS ................................................................................................................... 62

CONSOLIDATED FINANCIAL STATEMENTS ............................................................... 85

AnnualReport2009-10

2

ANDHRA PRADESH01. RamagundamThermalPowerProject

02. VizagMonolith,WestWallProtection

03. GodavariBarrageatRajahmundry

04. PapavinasamDam

05. ChimneyatVijayawada

06. EnvironmentalEngineeringWorksatHyderabad

07. RailwayBridgeoverriverGodavari

08. VijayawadaTunnelWorks

09. GodavariLISPhaseI

10. GodavariLISPhaseII

11. PolavaramProjectRightMainCanal

12. NorthSouthCorridorNHDPPhaseIIPackageAP-8onBOT(Annuity)basis

13. CavernforCrudeOilStorage,Vishakhapatnam

14. RajivDummugudem

15. PulaSubbaiahVeligondaTunnel

16. JCRDevadulaLISPhaseIII

17. PranahitaChevellaLIS

ASSAM18. BrahmaputraBridgeatAmingaon

andTezpur

19. CivilWorksforRefineryatGuwahati

20. FourlaningofNH-54,(AS23)

21. SingleLineTunnelNo.1 betweenDholakalandKalmai

BIHAR22. SoneBarrage

23. GangaBridgeatMokameh

24. BarauniThermalPowerPlant

25. PanchetPowerhouse

26. RailcumRoadBridgeMunger

CHATTISGARH27. BhilaiSteelPlant

28. BailadilaProject

DELHI

29. WaterandSewageTreatmentPlants

30. DMRC-VishwaVidyalayatoISBT

31. DMRC-AirportMetroExpressLineContractAMEL-C1

32. DMRC-AirportMetroExpressLineContractAMEL-C6

33. BadarpurElevatedHighway

GOA34. GoaBargeBerthatMarmugoa

GUJARAT35. KandlaOilJetty

36. 180mhighChimneyatWanakbori

37. TapiRoadBridge

38. KakraparAtomicPowerProject

39. TwoCoolingTowersatGandhinagar

40. GujaratStateHighwaysProject-MehsanatoPalanpur

41. SaurashtraBranchCanalPumpingScheme

42. KalolMehsanaGasPipelineProject

43. PumpedWaterSupplySchemefromKesariatoSonaria,(NC-25)

HARYANA44. RoadBridgeatPalwai

45. PanipatChimney

46. HathnikundBarrageatYamunanagar

HIMACHAL PRADESH47. ChameraHEP,StageI

48. NathpaJhakriHEP

49. ChameraHEP,StageIII

50. KashangHEP

JAMMU & KASHMIR51. SalalHEP

52. Udhampur-Srinagar-BaramullaRail

53. Uri-IIHEP,Lot1

54. PirPanjalTunnel(Zone-VA)

55. PirPanjalTunnel(Zone-VB)

56. MughalRoad

57. SawalkoteHEP

58. ChutakHEP,Lot1

59. NimmoBazgoHEP,Lot1

60. KishangangaHEP

JHARKAND61. ChandilDam

62. IchaDam

63. GrandTrunkRoadImprovementProject

KARNATAKA64. TunnelandPowerhouseat

Sharavati

65. DockworkforMPTatMangalore

66. KadraDam

67. KarnatakaStateHighwaysProject

68.CavernforCrudeOilStorage,Padur

KERALA69. TankerTerminalandFertiliserBerth,

Cochin

70. DamacrossKulamavu

71. DamofPeppara

72. DamacrossIdamalayar

73. LowerPeriyarTunnelPowerProject

74. DamacrossMoozhiyarandVeluthodu

75. SebarigiriDam

76. WellingtonBridge,Cochin

77. LowerPeriyarDamandPowerhouse

78. BrahmapuramDieselPowerPlant

MADHYA PRADESH79. SatpuraTPS

80. TonsRoadBridge

81. TonsHEP

82. RoadBridgeoverIndravatiRiver

MAHARASHTRA83. UranTurbineandLPGStation

84. BhandupWaterTreatmentComplex

85. BARCCivilWorks

86. SSSFProjectatTarapur

87. SinaAqueduct

88. PanvelCreekBridge

89. BarviExpansionProject

90. RailwaybridgesoverVasaiCreek

91. BhorghatTunnel

92. FactoryCivilWorksforPremierAutomobilesLimited

93. Ambernath/UlhasnagarSTP

94. WaterTreatmentPlant,Pune

95. UndergroundPowerhouse,Koyna

96. KolkewadiDam

97. BridgeoverRiverUlhas

98. TrombayChimneyWorks

HCC'S CONTRIBUTION TO NATION BUILDING

3

99. NhavaShevaWTPWorks,Raigadh

100.TunnelbetweenSewriandFutka

101.KoynaStageIVPowerhouseComplex

102.TunnelbetweenEMosesRoadandRuparelCollege,Mumbai

103.AeratedLagoons,Mumbai

104.BandraEffluentandInfluent Disposal,Mumbai

105.HousingComplex,NaviMumbai

106.NH-3MP/MaharashtraBorder-Dhule

107.GhatkoparHighLevelTunnel, Mumbai

108.Mumbai-PuneExpressway

109.VaitarnaDam

110.SataraKolhapurRoad,NH-4

111.WaterSupplyTunnelfrom BhanduptoCharkop,Mumbai

112.Bandra-WorliSeaLink

113.GosikhurdSpillway,Nagpur

114.Lavasa,Pune

115.PunePaudBOTRoad

116.GhodazariBranchCanal

117.WaterSupplyTunnelfromMaroshitoRuparelCollege,Mumbai

118.MiddleVaitarnaWaterPipeline

119.GosikhurdHydelScheme

120.DGNPDry-DockandWharves Construction,Mumbai

ORISSA121.DamatUpperKolab

122.RoadBridgeacrossMahanadi

123.SyphonesatKuakhaiandKhushbhadra

124.NarajBarrage,NewCuttack

125.ParadipPortRoad

126.PotShellFabricationWorksfor AdityaAluminiumProject

127.PotSuperstructureFabrication WorksforAdityaAluminiumProject

128.CivilandPilingWorksforAditya AluminiumProject

PUNJAB129.140mhighChimneyatRopar

130.RailCoachFactoryatKapurthala

RAJASTHAN131.RajasthanAtomicPowerProject,

UnitsI&II

132.ChambalBridgeatDholpur

133.RajasthanAtomicPowerProject,Units3&4

134.RajasthanAtomicPowerProject,Units5&6

135.East-WestCorridorProject, Package-EW-II(RJ-7)

SIKKIM136.TeestaHydroelectricProject

StageVI

TAMIL NADU137.KadamparaiPumpedStorage

138.LowerMetturBarrages, SubstructureandPowerhouse

139.ChennaiOreBerth,Jetty,Wharf

140.SewageTreatmentPlant,Chennai

141.UpperNirarTunnel

142.NavamalaiTunnel

143.EnnorePort-RockQuarrying

144.EnnoreBreakwater

145.MassRapidTransitSystem,Chennai

146.KudankulamNuclearPower Project,Units1&2,PackageIII

147.TirupurWaterSupplyProject

148.ChennaiBypass,PackageCBP2

UTTAR PRADESH149.ManeriBhaliHydelProject

150.NaroraAtomicPowerProject

151.RihandDam

152.RihandSTPP

153.ShardsandGhograBarrages

154.YamunaHydelProject

155.GomtiAqueduct

156.SaiAqueduct

157.VaranasiBridge

158.MalvikaSteelWorks

159.NainiCableStayedBridge

160.AllahabadBypassRoad,PackageABP2

161.Lucknow-MuzaffarpurNationalHighwayProjectPackageLMNHP-EWII(WB)-1

162.Lucknow-MuzaffarpurNationalHighwayProjectPackageLMNHP-EWII(WB)-2

163.Lucknow-MuzaffarpurNationalHighwayProjectPackageLMNHP-EWII(WB)-3

164.Lucknow-MuzaffarpurNationalHighwayProjectPackageLMNHP-EWII(WB)-4

UTTARAKHAND165.DhauligangaHEP

166.LoharinagPalaHEP

WEST BENGAL167.FarakkaBarrage

168.MahanandaBarrage

169.KolkataMetro

170.TeestaBarrage

171.HaldiaDocksProject

172.EnvironmentalEngineeringWorksatKolkata

173.KalyaniBridge

174.EarthworksforFarakkaSTPP

175.DaukBarrage

176.RCCChimneyforKolaghatTPS

177.UnderwaterworksforKTPP

178.GoldenQuadrilateralRoadProject-KolaghattoKharagpur

179.PuruliaPumpedStorageProject

180.TeestaLowDamHEPStageIV,LotI

181.ElevatedRoadCorridorfrom ParkCircustoE.M.Bypass,Kolkata

182.Four-laningofBahrampore-FarrakaSectionofNH-34

183.Four-laningofFarraka-RaiganjSectionofNH-34

184.Four-laningofRaiganj-DalkholaSectionofNH-34

BHUTAN185.KurichuHydroelectricDamProject

186.TalaHydroelectricProject,PackageC-1

187.TalaHydroelectricProject, PackageC-4

188.PunatsangchhuHydroelectircProject-Powerhouse

189.DagachhuHydroPowerPlant(CivilWorks),114MW

Projects completed in the year

Projects in progress

New Projects

BOT Projects

4

Chairman's Letter

DearShareholder,AsIwritethisletter,theworldhasavoidedwhatcouldhavebeenitsworstdepressioninthelast100years.Butitisfarfrombeing‘businessasusual’.AlthoughtheUnitedStatesisexpectedtogrowitsrealGDPbyabitover3%in2010,thesamecannotbesaidaboutmostofthedevelopedworld.TheEconomistpollputsEuroZonegrowthatamere1.3%for2010.Japanwillgrowby1.9%.TheUnitedKingdomwillbeluckytopost1.3%GDPgrowth.GreeceisbankruptandS&Phassharplycutitssovereigncreditrating.ItsGDPisexpectedtocontractby2.5%.Spain,too,maycontractthisyear.

Equally,weareseeingaclearshiftingeographicalplays.Chinaachieved8.7%GDPgrowthin2009,andisexpectedtogrowatsomewherebetween9.7%and10%in2010.Indiashouldclock7.2%to7.5%growthin2009-10,andthencross8%in2010-11.AndBrazilisslatedtogrowatover5.5%in2010.Insimpleterms,thethreemajoremergingeconomies-Brazil,IndiaandChina-havenotonlyshruggedofftheslowdownremarkablyquickly,butarealsopoisedtodeliversignificantlyhigherGDPgrowthinthenextfewyears.EvenTheEconomist,notpronetooverstatement,haswritten,“Itishardlynewsthattheworld’scentreofgravityisshiftingtowardsemergingmarkets...Emergingcountriesarenolongercontenttobesourcesofcheaphandsandlowcostbrains.Insteadtheytooarebecominghotbedsofinnovation,producingbreakthroughsineverything...”[TheEconomist,leader,17thApril,2010p.9].

ThisisanIndiawhosegrowthwillhavetobedrivenbyinfrastructureinvestments.Until2007-08,therewasrapidgrowthininfrastructureactivity.Thatchangeddramaticallyfortheworsein2008-09,andcontinuedtobemutedformostof2009-10.Thankfully,infrastructurehasagaintakenofffromthelastquarterof2009-10,especiallywithinvestmentsinhighwaysandpowerprojects.Anditisstrengtheningfurthergoingbywhatweareseeingof2010-11.

Thus,whileweseesignificantgrowthin2010-11,thefactisthatyourCompany’sfinancialresultsfor2009-10havebeenmuted.Hereisabriefsummary:

HCC’sorderbookgrewby15%toRs.18,810croreduringtheyear.

Incomefromoperationsincreasedby10%toRs.3,863crorein2009-10.

EBITDA(beforeprofitsfromJVandotherincome)increasedby3%toRs.443crore.

PAT(includingprofitfromJVsandotherincome)ofRs.81crorein2009-10isnotcomparableto2008-09duetoone-timewrite-offsduring2009-10,andextraordinarygainsinthepreviousyear.

Althoughprofitsweresubdued,thereareseveralpositivetakeawaysfrom2009-10thataugurwellforthefuture.Letmesharesomeofthesewithyou.

First,thelandmarkBandra-WorliSeaLinkProjectwascompletedduringtheyear,andtodayboththecarriagewaysareopentotraffic.ItwasinauguratedinJune2009bySmt.SoniaGandhi,ChairpersonoftheUPA.Aniconicstructure,notonlyforMumbaibutthewholecountry,theSeaLinkwasawardedthe‘MostOutstandingBridge-NationalAward’bytheIndianInstitutionofBridgeEngineers(IIBE)in2009.

Second,therewasasizeablegrowthinyourCompany’sorderbook,whichstoodatRs.18,810croreason31stMarch,2010.Indeed,ithascrossedRs.23,000crore,includingRs.4,390croreworthoforderswhereHCCistheL1bidder.

Third,youmayrecallthatinJuly2009,yourCompanyraisedoverRs.480crorethroughqualifiedinstitutionalplacement(QIP).ThesefundshavebeenusedtoreduceHCC’sdebt,therebybringingdowntheinterestburdenandenablingyourCompanyrationaliseitsdebt-equityandinterestservicecoverageratios.Ineffect,HCChasunencumbereditsbalancesheet.

Fourth,theenvironmentofsubduedgrowthallowedyourCompanytofocusonimprovingitsprocessesandsystems,whichhasresultedingreaterorganisationalproductivityandbetterefficiencyinprojectmanagement.HCChasdevelopedanexcellentITsystemwhichcoversitsheadoffice,44majorprojects,keysuppliersandvendorsaswellasoperationsofitssubsidiariesincludingHCCInfrastructure,HCCRealEstateandLavasaCorporation.YourCompanyhasalsoadoptedanintegratedapproachtowardsquality,environment,healthandsafety,withtheobjectiveofcreatingacultureofcontinuousimprovementsthatcanenhanceproductanddeliverqualitywhilemaintainingthehigheststandardsofenvironmentprotectionandsafety.HCCadherestothestringentstandardsstipulatedbyISO9001:2008forquality;ISO14001:2004fortheenvironment;andBSOHSAS18001:2007foroccupationalhealthandsafety.

Fifth,inMarch2010,yourCompanymadeitsfirstinternationalacquisitionbytakingacontrollingstakeof66%inKarlSteinerAG(KSAG)ofSwitzerland.KSAGisatotalservicescontractor,andisengagedinplanninganddevelopingrealestateprojects,aswellasundertakingconstructionandrenovationwork.Ithasseverallandmarkworkstoitscredit,andisthesecondlargesttotalservicescontractorintheSwissmarket.TheKSAGacquisitionshouldhelpHCCtocapturebothlocalmarketopportunitiesandalsoprovidesapresenceforEuropeanexpansion.KSAG’sexpertiseintotalservicescontractingwillalsoallowHCCtoundertakethedevelopmentandconstructionofworld-class,high-endresidentialandcommercialspacesonaturnkeybasisinIndia.ThisisoneofthefastestgrowingsegmentsinIndia-currentlyestimatedat$25billionannually-andyourCompanyintendstocreateanicheforitselfbyaddressingtheIndiancustomer’sneedsfortopclass,greenandwell-integratedspacesforliving,workandleisure.

Sixth,HCCInfrastructurehasdonewell.ItservicesyourCompany’sforaysintheDesign,Build,Finance,OperateandTransfer(DBFOT)business.

5

HCCInfrastructurestarteditsoperationstwoyearsago.Inthelastyearitself,ithasgrownitsportfoliofromRs.2,300croretooverRs.5,500crore.TheassetsundermanagementincludesixNHAIroadconcessions,ofwhichoneisoperational.YourCompanyplanstogrowitsroadportfoliotoRs.15,000croreinthenext24to30months.

Seventh,HCCRealEstatehasshownpromise.Thecommercialcomplex,‘247Park’atVikhroli(West)inMumbai,wascompletedduringthecourseof2009-10.Eveninadepressedcommercialrealestatemarket,over75%of247Park’sleasableareahasbeenleasedout.ThebuildingwasawardedLeadershipinEnergyandEnvironmentalDesign(LEED)GoldCertification-thelargeststand-alonebuildinginIndiatoreceivethishonour.Inaddition,constructionactivitiesaresoonexpectedtocommenceontheCompany’slandparcelinVikhroli(East).

Eighth,Lavasahasbeenprogressingatarapidpace.SetamidstsevenhillsoftheSahyadrirangewitha60km.lakefront,LavasaisfreeIndia’sfirstplannedhillcitythatwillofferstate-of-the-artmodernamenitiesinatranquilandscenicsetting.Dasve,Lavasa’sfirsttown,willbereadylaterthisyear.Overthenext12yearsawiderangeofresidentialandcommercialfacilities,backedbytie-upswithpremiereducationinstitutes,anextensiverangeoftouristandfamilyentertainmentactivities,andbusinessopportunitiesfornon-pollutingindustries,willbecreatedatLavasa.

Followingthesoftinaugurationofthecityin2009,Lavasahasstartedgainingtractionasanindependententerprise.Ithasalreadycompletedpre-salesofmorethanRs.1,100crore,thusevolvingfromamagnificentvisiontoabusinessthatisalreadygeneratingfinancialreturns.Givenitsinitialsuccess,theprojecthasbeenexpandedto18,000acresversustheearlierplanofdeveloping12,500acres.Thiscoversfivetowns,andtheCentralBusinessDistrict(CBD).Lavasahasreacheditspointofinflexion.

Torecapitulate,2009-10wasaslowyearforyourCompany.However,itwasalsoayearthatallowedthemanagementtofocuson‘nutsandbolts’andprepareformoreaggressivemulti-prongedgrowth.Inlargepart,mostoftheseenablersareinplace.AndIbelievethatHCCisbetterpositionedtoleveragetheeconomicupswingof2010-11thaneverbefore.

MycongratulationstoHCC’semployeesforsteeringyourCompanyinwhatwasadifficultyear.And,asalways,thanksforyoursupport.

Yourssincerely,

Ajit Gulabchand ChairmanandManagingDirector

6

BOARD OF DIRECTORS

AjitGulabchandChairman & Managing Director

Y.H.Malegam

RajasR.Doshi

D.M.Popat

RamP.Gandhi

Prof.FredMoavenzadeh

SharadM.Kulkarni

NirmalP.Bhogilal

AnilC.Singhvi

K.G.Tendulkar(Dy.ManagingDirectorupto7thNovember,2009)

COMPANY SECRETARY VithalP.Kulkarni

AUDITORS K.S.Aiyar&Co.,CharteredAccountants

ADVOCATES & SOLICITORSMulla&Mulla&CraigieBlunt&Caroe,Kanga&Co.

BANKERS

ICICIBankLtd.

PunjabNationalBank

StateBankofIndia

IDBIBankLtd.

IndianBank

OrientalBankofCommerce

TheJammu&KashmirBank

CanaraBank

StateBankofPatiala

UnionBankofIndia

BankofBaroda

VijayaBank

INGVysyaBankLtd.

StandardCharteredBank

TheFederalBankLtd.

TheHongKong&ShanghaiCorporationLtd.

AxisBankLtd.

EximBankofIndia

StateBankofTravancore

BankofMaharashtra

DBSBankLtd.

StateBankofBikaner&Jaipur

CatholicSyrianBank

REGISTRAR & SHARE TRANSFER AGENT

TSRDarashawLtd.6-10HajiMoosaPatrawalaIndustrialEstate,20,Dr.E.MosesRoad,Mahalaxmi,Mumbai-400011

REGISTERED OFFICEHinconHouse,LalBahadurShastriMargVikhroli(West),Mumbai-400083

Company Information

7

Harsh working terrain - Nimoo Bazgo Hydro Power Project, Leh-Ladakh, Jammu & Kashmir

8

TheBusinessEnvironmentWhilethereareencouragingsignsfortheglobaleconomywithsomestabilisationininternationalfinancialmarketsandtwoquartersofpositivegrowthintheUS,muchofthedevelopedworldstillcontinuestowitnessnegativeorverylowrealGDPgrowth.Uncertaintiescontinuetohaunttheglobaleconomiclandscape.Businesssentiments,whilebetterthanbefore,stillremainmuted.

ManagementDiscussionandAnalysis

ThepositiveistheresilienceshownbytheIndianeconomy.Tobesure,growthfellfairlysharpfromthreeyearsof9%ormoreto6.7%in2008-09.However,theupswingstartedin2009-10.Asmattersstandtoday,theCentralStatisticalOrganisationispredicting7.2%GDPgrowthin2009-10.Manybelievethatitwillbebettered.Chart Aplotsthedata.Acoupleofpointsneedtobemade:First,IndiahasrecoveredbetterthananylargeeconomybarringChina;Second,growthisstilllowerthanwhatthenationhadgotusedto.

Constructionactivitieshaveastrongcorrelationwitheconomicgrowthaswellasinvestorsentiments.Asdiscussedinlastyear’sAnnualReport,uncertaintiesabouttheeconomyandsubduedbusinesssentimenthadstalledlargecapitaloutlaysininfrastructuredevelopmentin2008-09.Inaddition,therewasaliquiditycrunchinthesecondhalf,whichaffectedon-goingconstructionprojects.Inthismilieu,HindustanConstructionCompany’ssuccesslayinitsabilitytogrowtheorderbook.

Whileliquidityconditionsimprovedandtheeconomicoutlookstartedturningpositivein2009-10,formostoftheyeartheprivatesectorinIndiawasina‘watchandwait’phase-assessingthestrengthoftheeconomyinlightoftheglobalcrisis,andnotaggressivelycommittingtolargeinvestmentsinphysicalinfrastructure.Thatchangedfromthelastquarterof2009-10,when

ChartA:RealGDPGrowth(%)

10

8

6

4

2

0 2005-06 2006-07 2007-08 2008-09 2009-10

99.7

9

6.7

7.2

infrastructuretookoff,withinvestmentsinhighwaysandpowerprojects.Andithasstrengthenedfurtherinwhatweareseeingof2010-11.

However,itisfairtosaythatfor2009-10asawhole,theyearwasmutedasfarasinfrastructureinvestmentswereconcerned.Forinstance,thefirstquarterof2009-10sawthegeneralelectionstotheIndianParliament,

ortheLokSabha.ThemodelcodeofconductimposedbytheElectionCommissionpreventedanynewinvestmentsoftheGovernmentofIndia(GoI)untilelectionswerecompleted,andanewgovernmentswornin.Whileinvestorconfidenceimprovedwiththeelectionsresultinginastablegovernment,thenewministersnaturallytooksometimetoassessthesituationandkick-starttheinvestmentprocessonceagain.

Thankfully,GoIinvestmentsininfrastructuretookofffromthesecondhalfof2009-10,especiallyinhighways,powerandurbaninfrastructure-themoresointhelastquarterofthefinancialyear.Thesepositivedevelopmentshavedefinitelyincreasedtheorderbooksfortheinfrastructureandconstructionindustry.However,asyet,thesehavenottranslatedintofull-fledgedprojectexecution.Hence,therewasnotmuchpositiveimpactontheprofitandlossfor2009-10somethingthatoughttooccurmoresignificantlyin2010-11.

Theslowdownin2008-09and2009-10isevidentfromChart B,whichplotsrealgrowthinconstructionactivities.Whilethereisaslightimprovementingrowthfrom5.9%in2008-09to6.5%in2009-10,thelevelisfarbelowthedouble-digitgrowthratesrecordedinthethreeyearspriorto2008-09,whentheIndianeconomygrewatanannualrateofover9%.

9

2009-10:PerformanceHighlightsBeingaleaderintheIndianconstructionindustrythatoperatesacrossawidespectrumofsectors,theperformanceofHindustanConstructionCompany’s(‘HCC’or‘theCompany’)in2009-10wasalsoaffectedbytheseexternalexigencies.ThefinancialhighlightsofHCC’sperformanceonastand-alonebasisare:

• OrderBookincreasedby14.7%fromRs.16,400crorein2008-09toRs.18,810crorein2009-10

• Revenuefromoperationsincreasedby9.8%fromRs.3,518crorein2008-09toRs. 3,863crorein2010

• EBITDA(beforeprofitsfromJVandotherincome)grewby2.7%fromRs.431.4crorein2008-09toRs.442.9crorein2009-10

• PAT(includingprofitfromJVsandotherincome)ofRs.81.4croreisnotcomparabletopreviousyearduetoone-timewrite-offsofRs. 43croreduring2009-10,andextraordinarygainsinthepreviousyear

Giventhebusinessenvironmentdiscussedintheearlierparagraphs,sluggishnessintop-linegrowthandlowerprofitsweretobeexpected.ThereweresomeexternaluncertaintiesthatalsocameintoplaywhichfurtheraffectedtheCompany’srevenuegrowthandnetprofits.

OnewasAndhraPradesh.First,therewasthesuddendeathofchiefministerMr.Y.S.R.Reddy,whichcreatedapoliticalvacuumanduncertainty.Then,therewereinstancesofcivildisorderandviolencerelatingtothepoliticsofaseparatestateofTelengana.Giventheuncertainenvironment,HCCsloweddownexecutionofitsgovernmentprojectsinAndhraPradesh.TheCompanycarefullyassessedthesituationandfocusedoncashcollectionsandworkingcapitalmanagement.ThishadanadverseimpactonHCC’srevenuesfor2009-10.

Subsequently,theGovernmentofAndhraPradeshhasplacedongoingprojectsinthestateintothreecategories,basedonfundingandpriorityofexecution.MostofHCC’sprojectsareinthetoptwocategories.Onthebasisofthisclassification,andinconsultationwiththestategovernment,theCompanyhasnowgotbacktoitshigherprojectworkexecutionplan.TheproportionofirrigationordersinAndhraPradeshhasreduced

ChartB:RealGrowthinConstructionActivities(%)20

15

10

5

0

2005-06 2006-07 2007-08 2008-09 2009-10

16.5

12 10.1

5.96.5

from26%ason31stMarch,2009to18%ason31stMarch,2010.HCChasalsosucceededingettingpaymentsforworkdonetillJanuary2010,indicatingsubstantialimprovementinpendingreceivables,andconsequentworkingcapitalrequirements.

ProfitBeforeTaxandProfitAfterTaxin2009-10arenotcomparablewiththepreviousyear.Whilein2008-09,therewasaone-timeprofitbookedfromsaleofland,in2009-10,therewereone-timewrite-offsofRs.43croreonaccountofBandra-WorliSeaLinkinaugurationexpenses,politicaldonations,lossonaccountoffinalsettlementinNathpaJhakhriJVwiththeclientandlossonsaleofassets.Iftheimpactoftheseextraordinaryitemsisremoved,onalike-to-likebasis,financialperformancein2009-10hasimprovedcomparedto2008-09.

Here,itisworthnotingthatHCCcontinuedtosuccessfullygrowitsorderbook.Whileincrementsintheorderbookinagivenyeartypicallydonotraiserevenuesorprofitsinthatyear,thesecertainlydefinethefuturecourseoftheCompany.Itisthegrowthin,andcompositionof,theorderbookwhichreflectsignsofaparadigmshiftinHCC’sstrategicpositioning.

Since2008-09,EPCcontractshavebecomeasizablecomponentintheCompany’sorderbook.Suchordershavecontinuedtogrow.Besides,theprivatesector-includingHCC’sowninfrastructureJVs-hasbeenamajorsourceofHCC’sprojectorderbook.

StrategicDevelopmentsHCCfirmlyendorsesIndia’sgrowthpotential.Theslowdownin2008-09and2009-10wasduetotheexternalshockoftheglobaleconomicmeltdown.Thecountryrecoveredremarkablyquickly;isalreadyonahighergrowthtrend;andmosteconomicforecastssuggestthatIndiawillgrowatover8%annualrateinthenextfewyears.

However,ashasbeenpointedoutinthepastAnnualReports,infrastructuregrowthhasnotbeeninlinewiththerequirementsofsucharapidlygrowingeconomy.Theproblemhasbeenofpoorimplementation.Whiletherewassomeimprovementinthepaceofexecutionin

10

2009-10,thereismuchlefttobedesired.Takethecaseofpowerandhighways.Chart Cshowstheachievementagainstplanfortheyearintermsofnewcapacitiescreatedinpowergeneration.Therewasashortfallof3,896MWofplannedthermalpowercapacitycreation;806MWofhydroelectriccapacity;and220MWofnuclearpowercapacity.

ChartC:PowerCapacityCreation(2009-10)

Nuclear

Thermal

Hydel

AchievedShortfall

67%

70%

5% 95%

33%

30%

0% 20% 40% 60% 80% 100%

Similarly,inhighways,55%ofplanned12,901kmofNHDPV,81%of6,500kmofNHDPVI,theentire1,000kmofNHDPVII,and42%oftheportconnectivityroadsareyettobeawardedtoanyoneforconstruction.

Tobefair,therehavebeensomepositivesignals,especiallysincethelastquarterof2009-10.Mr.KamalNath,theUnionCabinetMinisterforRoadTransportandHighwayshasannouncedaplantoincreasetherateofroadconstructionfromaround9kmadayto20km,andtodosobylaunchingmegaprojectswithlargerpackagesizes.Therehavebeensomedevelopmentsinthepowersectoraswell,andespeciallyforlargercapacities.Whatisimportanttonoteinthesedevelopmentsisthegrowingroleoftheprivatesector.Mostgovernmentprojectsarethroughpublic-privatepartnerships(PPP).And,insomeprojects,especiallyinpower,theprivatesectorisplayingamoredirectrole.

HCChadanticipatedthesetrendsandrealisedthemassiveopportunitiesthatinfrastructureofferstotheprivatesector,giventhegovernment’sresourceconstraints.However,competenciesandcapabilitieshadtobebuilttoleveragethisopportunity.ThisiswhattheCompanyhasbeendoingoverthepastfewyears.

Broadlyspeaking,infrastructuredevelopmentandmanagementhasfourelements.Thesearevision,execution,maintenanceandthecustomerrelationship.Havingexcelledinexecutingprojectsonacontractbasisoverdecades,HCChasbeengraduallybutsurelydevelopingitsinternalexpertiseacrosstheentireinfrastructurevaluechain.

Bandra-Worli Sea Link, Mumbai, Maharashtra, June 30, 2009

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Historically,HCC’sexecutioncontractswerethoseinwhichengineeringandprocurementwasdoneeitherbytheclientorotheragencies.Overthelastfewyears,theCompanyhasbeenfocusingonbiddingforandsecuringcompleteEngineeringProcurementandConstruction(EPC)contracts.

Initially,HCCparticipatedinsomesmallprojectsthroughthisroutetogainexperience.Then,in2008-09,itcreatedaseparateverticalwithintheprojectsdivisionthatfocusedexclusivelyonEPCprojects.Ithasbornefruit.Today,HCCismanagingthelargestEPChydroelectricprojectinIndia,theKishangangaProject,whichisprogressingaccordingtotheplan.

TheEPCplatformcontinuedtogrowin2009-10.AmajordevelopmentduringtheyearwastheCompany’sentryintotheindustrialsector.ThreecontractsweresecuredfromHindalcoIndustriesfortheirAdityaAluminiumSmelterProjectatSambalpur,Orissa.Theworkinvolvesfabricationofthesmelterpotshells,thepotsuperstructureandcivilworks.TheCompanyalsosecuredacontractforcivil,electricalandmechanicalservicesforconstructinganewdrydockfortheIndianNavyinMumbai.

NotonlyhasHCCsecuredsuchorders,butithasalsogainedcertificationfromaglobaltechnologymajorindoingthesekindsofprojects.TheCompanycontinuestodevelopitsEPCcapabilitiesbyforgingallianceswithglobaltechnologymajorssuchasheavycivilmajorslikeEMECandHalcrowoftheUK,andVinciConstructionGrandsProjetsofFrance.

HCChasalsostartedmovingtowardscompleteinfrastructuredevelopment.Inurbaninfrastructuredevelopmentandmanagement,ithasbeenapioneerinIndiawiththedevelopmentofthehillcityofLavasa,thelargestrealestatedevelopmentofitskindinIndia.

Lavasa’sprogresshasbeenrapid.In2009-10,itstarteddeliveringhealthyfinancialreturns.ThisisvaluebeingcreatedthroughinvestmentsbyHCC,whosefinancialbenefitsarenotreflectedinthestand-alonefinancialresultsoftheCompany.DetailsofdevelopmentsatLavasaaregiveninsubsequentsections.

IntheCompany’sinfrastructurebusiness,HCCInfrastructurewasestablishedtwoyearsagotodevelopapremiumportfolioofDBFOT(Design,Build,Finance,OperateandTransfer)assetsthatgeneratestable,diversifiedandgrowingcashflowstreamswithahighreturnonequity.Thefocusisonroadsandhydropower,withpotentiallyopportunisticplaysinwater,airportsandports.

Thesecharacteristicshavecomeintoplay,andhavedrivenHCCInfrastructuretocreateaportfolioofRs.5,539crorewithin2years,detailsofwhicharegiveninthesubsequentsections.

Withthisdiversifiedgrowthobjective,inJuly2009,HCCraisedRs.480.1crorethroughtheissueof4.7croresharestoQualifiedInstitutionsBuyers(QIBs)throughprivateplacement,atanissuepriceofRs.102.15pershare.Aftertheissueofshares,thepaid-upshare

capitaloftheCompanyincreasedfromRs.25.63croretoRs.30.33crore.Withthisinfusionofcapital,HCChasstrengtheneditsbalancesheetandreducedfinancialleveragingrisks.

Inadditiontotheseinternaldevelopments,inMarch2010,HCCmadeitsfirstinternationalacquisitionbytakingacontrollingstakeinKarlSteinerAG(Switzerland).

InternationalAcquisition:KarlSteinerAG(KSAG)KSAG,ispartoftheSwitzerlandbasedSteinerGroup.Itisatotalservicescontractor,andisengagedinplanninganddevelopingrealestateprojects,aswellasundertakingconstructionandrenovationwork.Withaheritageof95years,primarilyintheEuropeanmarket,KSAGhasseverallandmarkworkstoitscredit,includingtheheadquartersofNestle,Google,WorldEconomicForum,TerminalT3ofGenevaairport,andseveralhotelsandresidentialbuildings.ItisthesecondlargesttotalservicecontractorintheSwissmarket.

HCChasagreedtoacquirea66%stakebyissuanceofnewsharesinconsiderationforaCHF35millioncashinvestmentinKSAG.Inturn,KSAGwillusethefundsforitsSwissoperationsandgrowthoftheCompany'scorebusinessinIndia'sgrowingresidentialandcommercialconstructionmarket.

KSAG’ssoleowner,PeterSteiner,willsellhisremainingsharestoHCCin2014.Untilthattime,hewillremainaminorityshareholderandfullysupportHCC’smanagementofKSAGasVice-Chairman.

ThestrategicfitofthistransactionisthatithelpsHCCtocapturethelocalmarketopportunityandprovidestheCompanywithapresenceforEuropeanexpansion.KSAG’srichexpertiseintotalservicescontractingwillallowHCCtoundertakethedevelopmentandconstructionofworld-classresidentialandcommercialspacesonaturnkeybasisinIndia.Thisisoneofthefastestgrowingsegmentsinthecountry,andtheCompanyintendstocreateanicheforitselfbyaddressingtheIndiancustomer’sneedsfortopclass,greenandwellintegratedspacesforliving,workandleisure.ThisstrategicfitalsoopenstheSwissandEuropeanmarkettoHCC’sEngineeringandConstruction(E&C)businessandwillhelpprocuregreateraccesstotechnologyandEPCcapability.

Highlights of the acquisition rationale are:

• EntryintotheintegratedbuildingconstructionmarketinIndia,whichisestimatedatRs.65,000toRs.75,000croreannually

• Totalsolutionscapabilityforafacilityatasinglesource

• Implementationofnewtechnologiestosupportsustainableandgreendevelopment

• Safeandfastconstructionprocesses

• Accesstoworld-class,cutting-edgeEuropeantechnologiesthatwillaugmentEPCofferingsinIndiaandothermarkets

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Essentially,HCCisinatransformationphase.Someofthebuildingblocksitwasputtinginplacetooccupyawiderspaceintheinfrastructuredevelopmentworldhaverecentlystartedtogenerateresults.Themetamorphosisfromabluechipconstructioncontractortoadiversifiedinfrastructuregroupisunderway.2009-10isyetanothersmallstepinthisdirection.Whileundertakingthisjourney,theCompanyisawareofthechallengesandpossiblepitfalls.Therefore,itremainsdisciplinedandcautiousinitsapproach.

Developmentsinthebusinessesof-EngineeringandConstruction(E&C),InfrastructureDevelopment,IntegratedUrbanDevelopmentandManagementandRealEstate-arereportedinthenextfewsections,alongwithkeyactivitiesthatwereundertakenintheSupportFunctions.

EngineeringandConstructionBusinessTheCompany’sOrderBookstandsatRs.18,810croreason31stMarch,2010,againstRs.16,400croreon31stMarch,2009.Whilebroaderissuessuchas

developmentsontheEPCandDBFOTfrontshavealreadybeendiscussed,therearetwootherissuesthattheprojectsdivisionhasstartedtacklingaggressively.

First,HCCisnowconsciouslyworkingonastrategyforequipment.Giventhepaceofgrowth,thereisafinebalancethatneedstobecreatedbetweeninvestinginequipmentthatsupportefficientprojectdeliveryanddeliveringstrongreturnsontheexistingbaseofequipmentbyincreasingitsutilisation.Consequently,machineshavebeenclassifiedintotwogroups.Onegroupincludesspecialpurposemachinesandequipmentthatareessentialformaintainingqualityinconstruction.ThesearemachinesthatHCCwillinvestin.Theothergroupcomprisesmachinesthatareroutineandcommodity-likeinnature.Thesewillbeoutsourced.TheCompanyisworkingondevelopingqualitysubcontractorsandleasingpartners.

Second,withthehugenumberofprojects,HCC’sworkingcapitalincreasedsignificantly.Whilesomeofthisisinherentgiventhebusinessmix,theCompanyis

504 m long, 45 m high concrete dam with spillway, Teesta Low Dam Hydro Power Project, West Bengal

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layingstressonexpeditingclaims,speedingupdisputeresolutionsandacceleratingthecashcyclecollections.Asof31stMarch,2010,HCCwasexecuting56projects.Developmentsacrossthedifferentprojectsectorsaregivenbelow.

PowerPower(hydro,nuclearandthermal)isthelargestsectorinHCC’sprojectsportfolio.TheCompanymaintaineditsleadershipinthehydropowersectorbysecuringanotherthreecontractsin2009-10.ThesewereGosikhurdHydelPowerSchemeinMaharashtra,PareHydro-electricProject(HEP)inArunachalPradesh,andDagachhuHEP(civilworks)inBhutan.HCCisalsoexecutingsixprojectsforNHPCLtd.,whichareprogressingwell.

Someofthemajorprojectsunderexecutionare:

Kishanganga Hydro-electric Project, Jammu and Kashmir

ThisRs. 2,725croreturnkeyconstructioncontractis

fora3x110MWhydro-electricpowerplant.Workhascommencedatsiteandwillpickupspeedin2010-11.

Chutak Hydro-electric Power Project, Kargil, Jammu and Kashmir

HCCisconstructingthe4x11MW,Rs. 411croreChutakHydro-electricProjectatKargilinJammuandKashmir.Allexcavationworkshavebeencompleted.Atpresent,concreteworksforthetunnel,barrageandundergroundpowerhousecavernareinprogress.

Nimoo Bazgo Hydro-electric Power Project, Leh, Jammu and Kashmir

The3x15MWNimooBazgoHydro-electricPowerProjectworthRs. 384croreisunderexecutionintheLeh-Ladakharea.Concreteworksareinprogress,andthedamandpowerhouseunitsareabout70%complete.

Uri-II Hydro-electric Project, Jammu and Kashmir

Theprojectinvolvescivilworksfora4x60MWUri

504 m long, 45 m high concrete dam with spillway, Teesta Low Dam Hydro Power Project, West Bengal

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Hydro-electricPowerPlant.Atpresent,concretingofthedamandpowerhouseisnearingcompletion.

Chamera Hydro-electric Power Project, Stage III, Himachal Pradesh

TheCompanyiscarryingoutcivilworksofthis3x77MWpowerproject.Excavationworksarecompleteandconcretingoftunnelsanddamisatanadvancedstage.

Teesta Low Dam HEP – Stage IV, West Bengal

ThisRs. 396croreprojectinvolvescivilworksfora4x40MWhydro-electricproject.68%ofconcreteworkinthepowerdamhasbeencompleted.

Dagachhu Hydro Power Plant, Bhutan

TheCompanysecuredtheEPCcontractforthis114MWhydropowerplantvaluedatRs. 388crorefromDagachhuHydroPowerCorporationLtd.

Kashang Hydro-electric Project, Stage I, Himachal Pradesh

ThisRs.296croreprojectbyHimachalPradeshPowerCorporationLtd.isforconstructinga3x65MWpowerplant.Excavationfortheriverdiversionandundergroundworksareunderprogress.

Pare Hydro-electric Project, Arunachal Pradesh

Workhascommencedonthis2x55MWpowerproject

forNorthEasternElectricPowerCorporation(NEEPCO).ThecontractvalueisRs.276crore.

Punatsangchhu-1 Hydro-electric Project, Bhutan

ThisRs.688crorecontractfromPunatsangchhuHydro-electricPowerAuthorityinvolvesallcivilandhydro-mechanicalworksforthe1,200MWhydro-electricpowerplant.Workhascommencedforthepowerhouseandtunnels.

Teesta Hydro-electric Project - Stage VI, Sikkim

TheCompanyisexecutingtwopackagesforTeestaHEPStageVIforLancoInfratech.Onepackageisforan8.25kmtwinheadracetunnel.Thesecondpackageisforanundergroundpowerhouseandalliedundergroundworks.Workonboththepackagesisprogressingwell.

Kudankulam Nuclear Power Project, Tamil Nadu

HCCisexecutingtwopackagesforthis2x1,000MWpowerprojectforNuclearPowerCorporationofIndiaLtd.(NPCIL).PackageIIIinvolvesconstructionofthereactorandauxiliarybuildingsforthetwounits;andpackageC6comprisesa2kmlongbreakwaterandintakeworks.Workonboththepackagesisnearingcompletion.

2 x 1000 MW Kudankulam Nuclear Power Project, Tamil Nadu

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TransportationHCCcontinuestobeacrucialplayerinthetransportsectorwithitsinvolvementinhighwaydevelopmentprojects,bridges,tunnelsandmetros.

ThelandmarkBandra-WorliSeaLinkProjectiscompleteandboththecarriagewaysareopentotraffic.Thesealinkwasawardedthe‘MostOutstandingBridge–NationalAward’bytheIndianInstitutionofBridgeEngineers(IIBE)in2009.

TheCompanywasawardedtheEPCcontractfor256kmsofcontiguousstretchofNH-34inWestBengal,whichisbeingdevelopedbyHCCInfrastructure.TheprojectcostisapproximatelyRs.2,860crore.ItisexpectedthatHCCInfrastructure’sDBFOTbusinesswillcontributeRs.3,000croretoRs.4,000croreofroadprojectsannuallytotheprojectsdivision.HCCwasalsoawardedtwoadditionalprojects,whichincludeanelevatedroadcorridorinKolkatafromParkCircustotheEMBypassandasinglelinebroadgaugetunnelbetweenDholakalandKalmaiinAssamfortheNFRailway.

TheCompanyhasalsocompletedconstructionofthreeroadprojectsduringtheyearunderreview.Theseare(i)theWorldBankaidedAllahabadBypassPackageII,(ii)theNorth-SouthCorridorProjectPackageNS2/BOT/AP-8,and(iii)theParadipPortRoadconnectivityproject.Thesecondofthese,theAP-8BOTroadprojectwasoperational100daysaheadofschedule.TheDMRC’sAirportMetroExpressLinepackagesC1andC6arealsonearingcompletion.

Someofthemajorprojectsunderexecutionare:

Chennai Bypass, Tamil Nadu

ThisRs.404crore,32.5kmfour-laneroadshallinterconnectthreenationalhighways,namelyNH-4,NH-5andNH-45.PhaseIofthisprojectiscompleteandPhaseIIisatanadvancedstageofcompletion.

Mughal Road, Jammu and Kashmir

TheCompanyisinvolvedinconnectingBafliaz(Poonch)toShopian(nearSrinagar)throughthePirPanjalPassbybuildingan83kmtwo-laneasphaltroad.Withthisroad,approximately550kmofanadditional,circuitouscommuteshallbereduced,thusimprovingconnectivityinJammuandKashmir.Theroadexcavationisnearingcompletion.

MP-Dhule Road on NH-3, Maharashtra

Constructionhascommencedonthis96.5kmlongDBFOTroadforthefour-laningofMaharashtraBorder–DhuleSectionofNH-3underNHDPPhaseIII.

Lucknow-Muzaffarpur National Highway, Packages LMNHP-EW II (WB)-1 to 4, Uttar Pradesh

FourconsecutivepackagesontheLucknow-GorakhpursectionoftheWorldBankaidedLucknow-MuzaffarpurNationalHighwayProjectareunderconstruction.

Theworkinvolvesfour-laningofa156km.stretchbystrengtheningtheexistingtwolanesofasphaltpavementandconstructingtwonewlanesofconcretepavement.Atpresent,124kmfour-lanecarriagewayand31kmofserviceroadhavebeencompleted.

Udhampur-Srinagar-Baramulla Railway Line Project, Jammu and Kashmir

An11kmtunnelontheLaole–QazigundsectionofUdhampur-Srinagar-BaramullaRailwayLineProjectisbeingexecutedbyHCC.Theexcavationofa7.1kmtunneland5kmofconcretelininghasbeencompleted.

WaterSupplyandIrrigationTheCompanyisexecutingvariouswatersupplyandirrigationprojectsinMaharashtra,GujaratandAndhraPradesh.HCChassecuredthe62.28kmpumpedwatersupplyschemefromKesariatoSonariainGujarat(PackageNC-25),fortheGujaratWaterInfrastructureLtd.

Someofthemajorprojectsunderexecutionare:

JCR Devadula Lift Irrigation Scheme, Andhra Pradesh

HCCisinvolvedinallthethreephasesoftheJCRDevadulaGodavariLiftIrrigationScheme.Thisisthesecondlargestschemeofthiskindintheworldandshallcatertotheirrigationanddrinkingwaterrequirementof647,000acresofland.

Inthesecondphase,trialsforthewatersysteminthe38kmpipelinefromitsintaketothefirstBhimghanpurtankweresuccessfullyconducted.Inthethirdphase,HCCisinvolvedintwopackagesforthreerowsof38kmpipelineand55kmlongtunnel.Workisproceedingwellinboththepackages.

IV Mumbai (Middle Vaitarana) Water Supply Project, Section-II, Maharashtra

Thisisa15.7kmpipelineprojectwhichshallaidMunicipalCorporationofGreaterMumbaitoaugmentMumbai’swatersupplyby455millionlitresperday.Pipelayingisnearingcompletion.

Maroshi Ruparel Tunnel Contract ARFC 2, Maharashtra

TheRs.415croreprojectentailsconstructinga12.4kmtunnelpositionedatadepthofabout65metresbelowthegroundlevel.TunnelboringontheVakola-Maroshisectionhasbeencompleted,andisinprogressintheVakola-Mahimsection.

Miscellaneous

Inadditiontotheaboveprojects,HCChasenteredtheindustrialconstructionspace.ApartfromthesmelterprojectsinEPC,theCompanyalsosecuredacontractfortheconstructionofacrudeoilstoragecavernatPadurinKarnatakafromIndianStrategicPetroleumReservesLimited(ISPRL).ThecontractisvaluedatRs.375crore.AsimilarcontractforcivilworksofstoragecavernsbyISPRLatVizag(AndhraPradesh)isunderexecution.

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InfrastructureDevelopmentHCCInfrastructureremainscommittedtodevelopingapremiumportfolioofinfrastructureassetsthatwillserveIndia’sneedswhilecreatingshareholdervaluefortheCompanybygeneratingstable,diversifiedandgrowingcashflowstreamsoverthelong-term.

HCC’sdecisiontoentertheDesign,Build,Finance,OperateandTransfer(DBFOT)businessasadeveloperispartofalargerbusinessplan.WhileinvestingininfrastructureassetsisanaturalprogressionofHCC’sinherentabilitytooperateinmostdomainsofengineeringconstruction,itmustbenotedthatassetdevelopmentandmanagementrequiresdifferentkindsofexpertisethatextendtoconceptinnovation,evaluationofriskandreturn,andindeliveringthebrandpromisetothecustomeroverthelifeoftheasset.

TheHCCInfrastructureteamisbuildingsuchexpertisebyleveragingitsin-houseconstructionknowledgewhilecreatingitsownbandwidthasanassetmanager.

Sinceitsinceptiontwoyearsago,HCCInfrastructurehasgrownitsportfoliofromRs.2,307crorein2008-09toRs.5,539crorein2009-10.

TheassetsundermanagementincludesixNHAIroadconcessions,ofwhichoneisoperational.TheCompanyplanstogrowitsroadportfoliotoRs. 15,000croreinthenext24to30months,andwillensureadequatefinancialtie-upstofundtheequityrequirementsofsuchprojectsandalsobidforthenewermega-highwayprojects.

HCCInfrastructureisconcurrentlyevaluatingopportunitiesinhydropowerandwater,whereHCChasaninherentedgegivenitsEPCcapabilities.Itisalsoevaluatingopportunitiesinairportsandports.

Whilepursuingthisbusiness,HCCisawarethatmerecreationofasizeableportfoliodoesnotimplygreatershareholderwealth.Projectsmustearnhighreturnsonequitywhileeffectivelymanagingriskandmaximisingfreecashflow.Toachievethesegoals,HCCInfrastructureadoptsadisciplinedandpatientinvestmentstrategy.Forexample,in2009-10,whileHCCInfrastructurequalifiedfor27roadprojects,itfocusedbidsononlythreeprojectswithhigherprobabilityoffinancialsuccess.EachofHCC’sexistingfivetollprojectsmeetsahighhurdlerateofreturn,withupsidecharacteristics.

New Assets under Development:InFebruary2010,theNHAIawardedthreecontiguoussectionsofapproximately256kmforthedevelopmentofexistingtwolanestofourlanesbetweenBahramporetoDalkholaonNH-34inWestBengal.Theseconcessions,worthRs. 3,231crore,wereawardedtoHCCInfrastructureonaDBFOTtollbasiswithacumulativegrantofRs.1,033crore.ThefirstsectionisfromBahramporetoFarakka(103km);thesecondisfromFarakkatoRaiganj(103km);andthirdisbetweenRaiganjtoDalkhola(50km).HCCInfrastructurehasalreadyreceivedsanctionsforthefinancialclosureofallthreeassetsata10.5%fixedratethroughtheconstructionperiod.

Update on Existing Assets:TheNirmalBOTRoadinAndhraPradeshfromkm278(Kadthal)tokm.308(Armur)ofNH-7undertheNorth-SouthCorridor(NHDPPhase-II)onaBOTannuitybasisisfullyoperational,andmanagedbyanin-houseoperationsandmaintenanceteam.Commercialoperationwasachieved100daysaheadofschedule.ThesixlaneBadarpur-FaridabadElevatedHighwayProjectfromkm16tokm20ontheDelhi-AgraSectionofNH-2hasalsoreached65%completionwithin15months,andisexpectedtobecommerciallyoperationalbyDecemberofthisyear.ThefourlaneDhule-PalasnerRoadProjectonNH-3fromkm168tokm265inMaharashtraunderDBFOThasachievedfinancialclosureandisdueforcompletionbyJune2012.

Lavasa-IntegratedUrbanDevelopmentandManagementLavasaisHCC’sambitiousprojecttodevelopacompletehillcity.FromHCC’sperspective,thiscomprehensiveurbandevelopmentandmanagementisauniqueattemptatinfrastructuredevelopment,andtheonlyprivatesectordevelopmentofitskindinIndia,andpossiblytheworld.Theexecutionofthisventurecontinuesonschedule,andiscurrentlyamongstthelargestconstructionsitesinIndia.

SetamidstsevenhillsoftheSahyadrirangewitha60km.lakefront,LavasaisfreeIndia’sfirstplannedhillcity.Itwillbeaself-sustainingcitybuiltaroundfourprincipleactivities-live,learn,workandplay.

Theentirecityisbeingdevelopedwithafocusonprovidingworld-classfacilitiesineachofthesedomains.Itoffersawiderangeofresidentialandcommercialfacilities,tie-upswithpremiernationalandinternationaleducationinstitutions,anextensiverangeoftouristactivitiesandfamilyentertainmentopportunities,andseveralbusinessopportunitiesacrossarangeofnon-pollutingindustries.

Withthesoftinaugurationofthecityin2009andactivepropertysales,Lavasahasstartedgainingtractionasanindependententerprise.Thesubsidiaryhasbeencontinuouslyimprovingitsoperationalperformanceandhasalreadycompletedpre-salesofmorethanRs.1,100crore.During2009-10,therewerelandsalesworthRs. 210croreandbuilt-upspacesalesofRs. 265crore.

Thefinancialhighlightsduring2009-10are:

• RevenueswereRs. 482crore

• PATwasRs.140crore

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Inotherwords,Lavasahasevolvedfromagrandvisiontoabusinessportfoliothatisactivelygeneratingfinancialreturns.Givenitsinitialsuccess,HCChasunveiledanewexpandedplanfortheproject.Thisenvisagesdevelopmentof18,000acresversustheearlierplanof12,500acres.

Thenewplaninvolvesthedevelopmentof157millionsquarefeetover12years,ofwhich100millionsquarefeetwillberesidential-implyingoneofthelargestrealestatedevelopmentsofitskindinIndia.Thiscoversfiveprimarytowns-Dasve,Mugaon,Dhamanohol,Sakhari-Wadavaliandthecentralbusinessdistrict(CBD).Throughinternalfundsandborrowing,mostofthisexpandedplanhasachievedfinancialclosure.

Asofnow,overRs.1,800crorehasbeeninvestedandasubstantialpartoftheinfrastructureisinplace.Dasvetownisunderactiveimplementation,whilethemasterplanforMugaonisreadyandinfrastructureisunderexecution.Administratively,healthcare,securityandbankingfacilitieshavecommencedatDasve.

RealEstate

GiventheuncertaintiesintheIndianrealestatemarket,especiallyinthecommercialsegment,HCChasadoptedacautiousapproachingrowingtherealestatebusiness.Thefocushasbeenonexecutingexistingprojects.

247 Park at Vikhroli (West):Thecommercialcomplex,‘247Park’atVikhroli(West),wascompletedin2009-10.Inadepressedcommercialrealestatemarket,‘247Park’hasreceivedgoodresponsefromclients,andmorethan75%oftheoverallleasableareahasbeenleasedout.During2009-10,thebuildingwasawardedLeadershipinEnergyandEnvironmentalDesign(LEED)GoldCertification-thelargeststand-alonebuildinginIndiatoreceivethisrecognition.ItwasalsoawardedbyCNBCAwaaz-CRISILas‘TheBestCommercialProjectintheWesternRegion’.

Development of Vikhroli (E) land parcel:HCCownsalandparcelatHariyalivillage,Vikhroli(E),whichwasdeclaredaslumundertheSlumRehabilitationActof1973.HCCRealEstateisdevelopingthislandparcelthroughPanchkutirDevelopersLtd.,awhollyownedsubsidiaryofHCC.Consenthasbeenreceivedfrommorethan70%ofslumdwellersfordevelopmentofthisland,andthenecessarydocumentationhasbeenfiledwiththestatutoryauthoritiesseekinganapprovalofdevelopmentonthislandparcel.Constructionactivitiesareexpectedtocommencein2010-11.

OperationsSupportTheoperationsofthedifferentbusinessesaresupportedbyInformationTechnology,ManagementSystems,IntellectualPropertyRights,BrandingandHumanResource.

InformationTechnology(IT)Operationalforoverfouryears,theSAPERPsystemisnowwellestablishedwithinHCC.BesidesthecorporateheadofficeandtheengineeringworkshopatTara,49ofHCC’sprojectsnowrununderSAP.Moreover,theERPsystemisnowextendedtosubsidiariesincludingHCCInfrastructure,HCCRealEstateandLavasaCorporation.AsapartoftheCompany’scontinuousimprovementinitiatives,thefocusistonowleveragetheITplatformtofurtherimprovebusinessprocesses.

TheCompanyisintheprocessofconvertingmostofthedocumentswithinthesystemintodigitalformusingSAP’s‘DocumentManagementSystem’,whichisseamlesslyintegratedwiththebaseERP.NinecriticaldepartmentswithinHCCarealreadyoperatingonthissystem.

HavingstabilisedtheERPwithintheCompany,HCChasextendedthereachoftheautomatedbusinesspracticestoitskeysuppliersandvendors.Asupplierportal,developedusingSAP’sSRMsoftwarecomponents,waslaunchedin2009-10.ManysuppliershavealreadystartedautomatedtransactionswithHCC.

SincetheCompanyoperatesinseveralremoteareas,thereisimmensescopeofimprovingefficiencyoflogisticsandsupplychainthroughtheimplementationofmobilitybasedITsolutions.HCChasstartedrealisingthepotentialofthesesystems.IthasalreadystartedusingGPStechnologyandGPRSnetworkingforthispurpose.And,applicationssuchasvehicletrackingandtime-cyclemonitoringarebeingdeployed.

Withtheobjectivetoensurenearreal-timeupdatingofmaterialconsumptionandproductiondataintoSAPforefficientmonitoringanddecisionmaking,HCCisnowintheprocessofintegratingmajorequipmentdatawithSAP.Tobeginwith,batchingplantsatfiveprojectshavebeenintegrated,andautomateddataflowfromtheseplantstoSAPhasstarted.

AlltheITapplicationsaresupportedattheback-endbyaruggedandscalableinfrastructurecomprisingstate-of-the-artwideareanetworkandawellconnecteddatacentre.

Beingenvisagedasastate-of-the-artmoderncity,ITisextremelycrucialtothesuccessofLavasa.ASpecialPurposeVehicle(SPV)calledMyCityTechnologyLtd.(MyCity)hasbeenformedinpartnershipwithWiprotosupportLavasaintheareasofe-governance,integratedbuildingmanagementsolutions,telecom,WiFiservices,citymanagementsolutionsandICTinfrastructure.

ThecitynetworkdesignusingGigabitPassiveOpticalNetwork(GPON)designisnowcomplete.MyCityisintheprocessofcompletingfibretohomeandstructure

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cablingforvariousresidentsandcommercialstructuresatDasve - thefirsttownbeingdevelopedatLavasa.

MyCityhasalsosignedanMoUwithTataTeleservicesMaharashtraLtd.(TTML)inJanuary2010,toprovidemobilityandnon-mobilitytelecomservicesonrevenuesharingbasis.TTMLlauncheditshighspeedwirelessInternetservicesPhoton+atDasveinFebruary2010.

ItwasobservedthatwhiletheinfrastructuresectorisrapidlygrowinginIndia,thereisrelativelylowpenetrationofITinthisindustry.Moreover,theITindustryhasalowlevelofunderstandingofthenuancesofinfrastructure.HavingsuccessfullyimplementedITsolutionswithintheCompany,HCCrealisedthebusinessopportunityavailableduetothisgap.Tocatertothisrequirement,HCC'sITdivisionhastransitionedinto'HighbarTechnologiesLtd'.,asubsidiaryoftheCompany,whichisanend-to-endsolutionproviderfortheinfrastructureindustry,within-depthexperienceinERPimplementation,GPSbasedtrackingsolutions,reinforcementsteeloptimizationetc.amongothers.HighbarTechnologieshasalreadyundertakenITdeploymentforitsstrongcustomerbaseof26clientsoverthelast18months.

ManagementSystemsHCC’sbusinessoperationsextendtoremoteprojectsitesspreadacrossdifferentstates.Creating,establishinganddevelopingbest-in-classprocessesandsystemsacrossthesesitesarefundamentaltodevelopingtheCompany’scompetitivestrength.

HCChasadoptedanintegratedapproachtowardsquality,environment,healthandsafetyandhasincorporatedtheseinbusinesspractices.Theobjectiveofanintegratedmanagementsystem(IMS)istoinculcateacultureofcontinuousimprovementthatwillenhancequalityoftheproductsandmaintainthehigheststandardsofenvironmentprotectionandsafetyoftheprojectteamtomaximisecustomersatisfaction.ThisadherestothestringentstandardsstipulatedbyISO9001:2008forQuality;ISO14001:2004forEnvironment;andBSOHSAS18001:2007forOccupationalHealthandSafety.

Onthesafetyfront,HCCfocusesoncreatingaculturethatcontinuallyreducesthefrequencyofincidentstoachievethegoalof‘ZeroIncidents’inatimeboundmanner.TheCompanyisalsocommittedtoreducingtheimpactonenvironmentduringexecutionofprojects.Toachievetheseobjectives,engineersatvariousfunctionallevelsaretrainedbyprofessionalagenciestoensureproperoperationofprocessesandsystems.Thesetrainedengineersthenactasinternalauditorstoconductregularbi-annualinternalIMSauditsbasedonadetailedschedule.

TherewereseveralIMS-relateddevelopmentsduring2009-2010.DuringJanuary-February2010,M/sTÜVNORD,thecertifyingagency,conductedasurveillanceauditforISO14001:2004,BSOHSAS18001:2007andacertificationauditforISO9001:2008toverifythestatusofcompliancetotherequirementsofthesestandards.ThreeoftheprojectsitesoftheCompanyandmostofthefunctionsatcorporateofficeweresubjectedtotheseaudits.TheauditorsrecommendedcontinuationofcertificationforISO14001:2004andBSOHSAS18001:2007,andhavealsoissuedacertificateforISO9001:2008.ThesecertificatesarevaliduptoMarch2011.

Duringthecourseofthisaudit,theexternalauditorsobservedHCCistheonlyIndiancompanytheyauditedwhichundertookactionstoconservewaterasapartofcorporatesocialresponsibilityundertheUnitedNationsCEOWaterMandate.

IntellectualPropertyRightsHCCcontinuedtopursueitsinitiativesforthecreationandprotectionofIntellectualProperty(IP)during2009-10.

The Patents Act, 1970

HCCcompletedtheformalitiesunderthePatentsActonthefollowinginventions,whichhavebeensubmittedtothepatentingauthorityandtheyareunderexaminationbythePatentOffice.

Breakwaters at 2 x 1000 MW Kudankulam Nuclear Power Project, Tamil Nadu

19

• Pipejointleaktestingdevice

• Asystemforautomaticaccountingoffluidsinavessel,containerortank

• Newcappingsystemfortestingconcreteandrockcores

• Systemandmethodforonlinemonitoringoffuelconsumptioninautomobiles

• Systemandmethodfordetectingtrespassingbelowaparkedvehicle

• GeotextileSandContainerMattresses(GSCM)liningfortemporaryriverbeddiversionchannels

The Trade Marks Act, 1999

• HCChascreatedatrademark‘Highbar’forofferingITservices.Amulti-classapplicationforregistrationofthistrademarkhasbeenfiledbeforetheRegistrarofTradeMarks,Mumbai

• Foritstrademark‘HCCRealEstate’HCCobtainedacertificateofregistrationoftrademarkfromtheRegistrarofTradeMarks,MumbaiinMarch2010

The Copyright Act, 1957

• HCCobtainedacopyrightregistrationcertificatefromtheCopyrightOffice,Delhi,fortheartisticworkcontainedin‘247Park’logoinOctober2009

BrandingInthefourthyearofHCC’ssystematicbrandinginitiatives,brandconsciousnesswithintheCompanyhasbecomemuchmoreintegratedintothecultureoftheenterprise.

BrandingisnowaconsistentpartofplanningrightfromthemobilisationphaseofeveryprojectsitesothattheassociationwithHCCisestablishedevenasworkbeginsatanewsite.Brandingat17projectsiteswascompleted.BrandedsitesnowfallunderthepurviewofHCC’sIMSsystemsandareregularlyauditedforbrandcompliance.

‘LivingtheBrand’workshopscontinuedtobeinitiatedatselectsites.ThesereceivedenthusiasticresponseandhelpedinstiltheresolvetomakeHCCaworld-classbrand.Thiseffortwillcontinuetobeextendedtoallsites.

HCCalsoparticipatedineighttradeandindustrymeetsandexpositionsduringtheyear,consistentlyenhancingitsbrandpresenceamongclientsandbusiness

associatesasaCompanyintheforefrontofinfrastructuredevelopment.TheseincludeddomesticandinternationalparticipationinSAARCandtradeeventsofthehydropower,tunnellingandnuclearpowersectors.

ThehighpointforBrandHCCwastheinaugurationofHCC’slandmarkproject,theBandra-WorliSeaLink,bySmt.SoniaGandhi,ChairpersonoftheUPAinJune2009,Mumbai.TheSeaLink,Mumbai’snewlandmark,providedtouchpointsforthewidestoutreachoftheCompany’sbrandidentity.TheopeningoftheSeaLinkwasprecededbyaspectacularlyorchestratedlaserlightsandfireworksshow.

HumanResourcesDuring2009-10,thefocusofhumanresourcemanagementwastoimproveinternalcompetenciesinthefollowingareas:

• World-classprojectmanagement

• Innovativeconstructionsolutions

Inprojectmanagement,aninitiativenamed‘ProjectTree’waslaunched.Thisisaimedatdefiningtheprojectlevelorganisationstructurewithafocusonplanningbasedexecution,designing,operations,processesandworkinterfaces.NecessarypersonnelhavebeeninductedinvariousprojectfunctionstofurtherstrengthentheCompany’sprojectmanagementskills.AninternationalfirmhasbeenengagedtostudyHCC’sprojectmanagementprocesses,andworkwiththeteamstoimplementbest-in-classprocesses.

Theorganisationhasalsobeenre-structuredwiththeaimoffocusingonBusinessDevelopment,ConstructionSolutions,IntegratedResourceManagement,alongwiththeBusinessVerticalsfocusingonorderacquisitionandexecution.

Inadditiontobridgingtheskillgaps,thefocusoftraininghasbeentoenhancecompetencyinstrategicareas.Mobiletrainingwasintroduced,takinglearningtotheplaceofworkandgivingitpracticalorientation.Safetytrainingmoduleswererevampedappropriatetoeachlevelofthemanagingteam.

Withsomelargeandmediumsizedprojectsbeingatthemobilisationstage,therewasmajorthrustonacquiringhumanresourcesparticularlyinthesecondhalfoftheyear.PerformanceManagementremainedakeyfocusareaandaplantomaketheappraisalprocesson-lineisunderimplementation.

Nirmal BOT, Andhra Pradesh, developed by HCC Infrastructure Ltd.

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Table 1: Abridged Profit and Loss account of HCC

2009-10 2008-09

Revenue

Incomefromoperations 3863.0 3518.3

Less:IncomefromJVs 218.8 204.6

Netincomefromoperations(a) 3644.2 3313.7

Profit/LossonintegratedJVs(b) (15.0) 0.1

Total(a)+(b) 3629.2 3313.8

Expenditure

Constructionexpenses 2647.7 2390.1

Staffcosts 394.4 374.9

Otherexpenditure 159.2 117.3

Interest 205.2 210.5

Depreciation 113.9 115.2

Total 3520.4 3208.0

PBDIT (including profit/loss on integrated JVs) 427.9 431.5

PBT(includingprofit/lossonintegratedJVs) 108.8 105.8

Otherincome 13.0 58.8

PBT(includingotherincomeandprofit/lossonintegratedJVs) 121.8 164.6*

Taxliability 40.4 39.2

PAT 81.4 125.4

Table 2: Key Financial Ratios

2009-10 2008-09

PBDIT / Net Income 11.8% 13.0%

PBT / Net Income 3.4% 5.0%

PBT / Gross Total Income 3.1% 4.6%

PAT / Gross Total Income 2.1% 3.5%

RONW 5.4% 12.5%

ROCE 8.6% 11.7%

Basic EPS (Rs.) 2.80 4.89

Whilenetincomefromoperationsincreasedby10%fromRs. 3,314crorein2008-09toRs. 3,644crorein2009-10,PBDIT(includingprofit/lossonintegratedJVs)reducedby0.8%fromRs.431.5crorein2008-09toRs.428crorein2009-10.

Thiswasprimarilyduetothereductioninoperatingmargins(PBDIT/netincome)from13%in2008-09to11.8%in2009-10(seeTable 2).

Throughconcertedeffortsatrationalisingthebalancesheet,interestcostswerereducedby2.5%fromRs.211crorein2008-09toRs.205crorein2009-10.

Asdiscussedearlierinthisreport,ProfitBeforeTaxandProfitAfterTaxin2009-10arenotcomparablewiththepreviousyear.Whilein2008-09,therewasaone-timeprofitbookedfromsaleofland,in2009-10,one-timewrite-offsofRs.43croreonaccountofBandra-WorliSeaLinkinaugurationexpenses,politicaldonations,lossonaccountoffinalsettlementinNathpaJhakhriJVwiththeclientandlossonsaleofassets.Iftheimpactoftheseextraordinaryitemsisremoved,onalike-to-likebasis,financialperformancein2009-10hasimprovedcomparedto2008-09.

FinancialReviewTable 1givestheabridgedprofitandlossforHCC,asastand-aloneCompany,whileTable 2liststhekeyfinancialratios.

*Includingone-timeprofitofRs.61.9crorefromsaleofland

(Rs. crore)

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InternalcontrolsandtheiradequacyHCChasanadequatesystemofinternalcontrolstoensurethatallassetsaresafeguardedandprotectedagainstlossfromunauthoriseduseordisposition,andtransactionsareauthorised,recordedandreportedcorrectly.

Theinternalcontrolissupplementedbyanextensiveprogrammeofinternalaudits,reviewbymanagement,documentedpolicies,guidelinesandprocedures.Theinternalcontrolisdesignedtoensurethatfinancialandotherrecordsarereliableforpreparingfinancialinformationandotherdata,andformaintainingaccountabilityofassets.

CorporateSocialResponsibility(CSR)HCChasactivelypursuedCSRactivities.Intheprocess,CSRhasevolvedfrombeingpassivephilanthropytocorporate-communityinvestments,whichtaketheformofasocialpartnershipinitiativebytheCompany.Atpresent,HCCisfocusedontakingitsCSRtothenextlevel,whereitbecomesanintegralpartofbusinessfunctions,goalsandstrategy.

TheareasthattheCompanyworksonincludeHIV/AIDS,disasterresponse,waterandeducation.Thereisadedicatedteam,whichplans,executesandmonitorstheseprogrammes,andeachprojectsitehasaCSRrepresentativewhoworkswiththecommunitiesaroundthesite.

HIV/AIDS Work Place Intervention Programme

HIV/AIDShasemergedasamajorthreatnotonlytothehealthsystembutalsototheeconomyofthenation.TheimmediateimpactofHIV/AIDSonthebusinessesisthelossofworkinghoursandincreasedcostofproductionduetosicknessoftheworkerswhorequirefrequentmedicalcareandremainabsentfromwork.

HCCbelievesthatHIV/AIDSisnolongerasocialissuebutasocio-economicone.AmongstthegroupsmostaffectedbyHIV/AIDSaremigrantworkers,sexworkers,injecteddrugusersandtruckdrivers.Initsbusinessoperations,HCCengagesmorethan30,000migrantlabourersandtruckdriverswhoarelargelyvulnerableand‘atrisk’ofacquiringtheHIVinfection.

HCChaslaunchedHIV/AIDSWorkplacePolicyandstartedtheHIV/AIDSWorkplaceIntervention(WPI)programmestoeducateandraiseawarenessofHIV/AIDSamongsttheworkforce,andenablethemtoprotectthemselvesandtheirfamiliesbyminimisingtheriskofHIVinfection.ThemajorthrustofHIV/AIDSWPIprogrammeisoncreatinganin-houseresourcepoolbytrainingthemastertrainersandpeereducators.Thisprogrammeisthenfurtherdisseminatedamongsttheentireworkforcebyconductingeducationalandawarenesssessions,condomdemonstration,toolboxtalk,referringforthetestingandSTIservices,IECmaterialdistribution,audio-visualsandstreetplays.

AsofMarch2010,some28,000workersandemployeeshavebeeneducatedandmadeawareoftheseissues.

Inaddition,122coretrainers(MasterTrainer/PeerEducators)havebeenprovidedtraining.Thetotalman-hoursspentforWPIwas177,952.

Disaster Response

TheEngineeringandConstructionDisasterResourceNetwork(E&CDRN)isanetworkthatenablesmobilisingtheexistingcapacitiesoftheE&Ccommunityduringandaftercrisestoreducesufferingandsavelives.Italsohelpsinsafeguardingman,machineandotherassetsoftheCompanyduringadisaster.HCC’sManagingDirector,Mr.AjitGulabchandisontheBoardofDirectorsofDRNGlobalandservesastheChairmanoftheIndianChapter.ThroughDRNIndia,HCChasprovidedreliefforseveralnaturalcalamities.In2009,ithelpedinthefloodsinAndhraPradesh.

HCCconducts‘FirstResponderTraining’andimpartsbasicknowledgeonlifesavingskillsanddisastermanagementforalltheemployees,includingworkers.Tillnow,FirstResponderTraininghasbeenconductedat28sites,covering9,851employeesand39,404man-hours.HCCalsoconductsEngineeringinEmergencies(EE),anextensivesecondlevelresidentialtrainingforselectedemployees,toformacoreteamofvolunteerswhocanbesenttolendsupportinemergencies.Sofar,54HCCengineershavebeensotrained.

Water

Waterscarcityisprevalentthroughoutmostpartsoftheworld.Businesssurvivalalsodependsonensuredwateravailability.ThereisacompellingbusinesscasetopursuewaterstewardshipandbecomeawaterconsciousCompany.Therefore,inMarch2008,HCCendorsedUnitedNationsGlobalCompact’s‘TheCEOWaterMandate’initiative.

HCCcommitstobecomeawaterconsciousCompanybyimplementingthecoreelementsof‘TheCEOWaterMandate’comprising:(i)waterefficiencyinitsdirectoperations,(ii)replenishingwatershedsinprojectareas,(iii)collectiveactionwithothercompaniesandprofessionalbodiesforpromotingsewagereuse,(iv)communityengagementforimprovingwaterservicesandwaterenvironmentand(v)constructivecontributionforimprovinglong-termpublicpoliciesonwater.HCChaspublisheditswaterconsciousnessactionsinapublicdocumenttitled‘CommunicationonProgress,2009’.(www.hccindia.com)

Waterconsciousnessincludes3R's(WaterRecycling,Reuse,Recharge)actionsduringbusinessoperations.HCChasimplementeda1millionlitresadayre-cyclingplantattheVizagCavernProject,anartificialwaterrechargepondattheBadarpurElevatedHighwayProjectandrooftoprainwaterharvestingatseveralsites.

Beyonditsownprojects,HCChasimplementedUjjivana,anIntegratedWaterEnvironmentEnhancementProjectatKihim,inthedistrictofRaigad,Maharashtra.Itisamulti-objectiveactivitythatimproveswaterenvironmentthroughvariousgroundlevelactionssuchassolidwastemanagement,sanitation,andenhancingthedomesticwatersupplyforthevillage.

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Goingforward,HCCplanstoadoptmeasurestoenhanceIndia’senvironmentalandsocialperformance,togetherwithadetailedaccountofquantitativeresultsobtainedafterimplementation.TheCompanyisworkingonitsSustainabilityReport(TripleBottomLine)asperGlobalReportingInitiative’sspecificationsfortheyear2009-2010,whichwillbereadybymid-2010.

CautionaryStatementStatementsinthisManagementDiscussionandAnalysis

describingtheCompany’sobjectives,projections,estimatesandexpectationsmaybe‘forwardlookingstatements’withinthemeaningofapplicablelawsandregulations.Actualresultsmightdiffersubstantiallyormateriallyfromthoseexpressedorimplied.ImportantdevelopmentsthatcouldaffecttheCompany’soperationsincludeadowntrendintheinfrastructuresector,significantchangesinpoliticalandeconomicenvironmentinIndia,exchangeratefluctuations,taxlaws,litigation,labourrelationsandinterestcosts.

57 m high dam - Nimoo Bazgo Hydro Power Project, Leh-Ladakh, Jammu & Kashmir

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CorporateGovernancePhilosophyHCChasalwaysbeencommittedtogrowthandlong-termshareholderwealthcreation,whilepreservingtheinterestofotherstakeholders-itsemployees,partners,customers,suppliersandthesocietyatlarge.Goodcorporategovernancepracticeshavebeenfundamentaltothefulfillmentofthiscommitment.Timelydisclosures,transparentbusinesspracticesandaneffectiveandindependentBoardhasbeenthefoundationonwhich,theCompanyhasadopteddiversebusinessmodelsandcorporatestructures,whichareessentialforsuccessinHCC’sbusinessdomainofinfrastructuredevelopment.

TheCompanydoesnotviewCorporateGovernanceprinciplesasasetofbindingobligations,butbelievesinusingitasaframeworkthatisinherenttotheethosandvaluesystemthatdrivesbusinesspractices.AtHCC,themanagementbelievesinupholdingitsresponsibilitiesasthetrusteeofallinvestors’capitalandstakeholders’interests.Itiscommittedtohighlevelsofethicsandintegrityinallitsbusinessdealingsthatavoidsallconflictsofinterest.Conductingbusiness,whileadheringtotheseprinciples,isthebasisforHCC’scorporategovernancephilosophy.

Thischapter,alongwiththechapteronadditionalshareholders’informationisnotonlytheHCC’sdisclosureoncompliancewiththemandatoryrequirementsoncorporategovernancestipulatedintheListingAgreementwiththeStockExchangesunderClause49,butalsohighlightssomeofthenon-mandatorypracticesadoptedbytheCompany.

I)BoardofDirectors

a) Composition of the Board

Ason31stMarch,2010,HCC’sBoardconsistedof

10members.TheChairmanandManagingDirectoristheonlyExecutiveDirector,whoisalsothePromoterDirectoroftheCompany.OutofremainingnineNon-ExecutiveDirectors,sevenareIndependentDirectors.ThecompositionoftheBoardisinconformitywithClause49oftheListingAgreement,whichstipulatesthatatleast50%oftheBoardshouldconsistofIndependentDirectors,iftheChairmanoftheBoardisanExecutiveDirector.

Mr.K.G.Tendulkar’stenureasDeputyManagingDirectorexpiredon7thNovember,2009,andhewasappointedasanAdditionalDirectorfrom8thNovember,2009.Consequently,hehasbecomeaNon-ExecutiveDirector.

ExcepttheChairmanandManagingDirector,allDirectorsareliabletoretirebyrotation.

(b) Board Meetings

TheBoardofDirectorsmetnine(9)timesduringtheyearon7thApril,2009,24thApril,2009,25thMay,2009,12thJune,2009,22ndJune,2009,24thJuly,2009,23rdOctober,2009,22ndJanuary,2010,and15thMarch,2010.Themaximumtimegapbetweenanytwoconsecutivemeetingsdidnotexceedfourmonths.

(c) Directors’ attendance record and Directorships held

AsmandatedbyClause49,noneoftheDirectorsaremembersofmorethantenBoard-levelcommitteesnoraretheyChairmenofmorethanfivesuchcommittees.

Report on Corporate Governance

30.7 km Polavaram Project, Right Main Canal, Andhra Pradesh

24

Notes.#Chairmanship/MembershipofAuditCommitteeandShareholders’/Investors’GrievanceCommittee.*K.G.Tendulkar'stenureasDeputyManagingDirectorexpiredon7thNovember,2009andhewasappointedasanAdditionalDirectorwitheffectfrom8thNovember,2009.Hence,hehasnowbeenassignedasaNon-ExecutiveDirectoroftheCompany.

AsmandatedunderClause49,theIndependentDirectorsonHCC’sBoard:

• ApartfromreceivingDirector’sremuneration,donothaveanymaterialpecuniaryrelationshipsortransactionswiththeCompany,itsPromoters,Directors,SeniorManagementoritsHoldingCompany,SubsidiariesandAssociateswhichmayaffectindependenceasaDirector

• ArenotrelatedtopromotersorpersonsoccupyingmanagementpositionsattheBoardleveloratonelevelbelowtheBoard

• HavenotbeenexecutiveoftheCompanyintheimmediatelyprecedingthreefinancialyears

• Arenotpartnersorexecutivesorwerenotpartnersorexecutivesduringtheprecedingthreeyearsofthe:

i. StatutoryauditfirmortheinternalauditfirmthatisassociatedwiththeCompany.

ii. Legalfirm(s)andconsultingfirm(s)thathaveamaterialassociationwiththeCompany.

• Arenotmaterialsuppliers,serviceprovidersor

customersorlessorsorlesseesoftheCompany,whichmayaffectindependenceoftheDirector

• ArenotsubstantialshareholdersoftheCompanyi.e.donotowntwopercentormoreoftheblockofvotingshares

• Arenotlessthan21yearsofage

(d) Information placed before the Board

Asapolicy,allmajordecisionsinvolvinginvestmentsandcapitalexpenditure,inadditiontomatterswhichstatutorilyrequiretheapprovaloftheBoardareputupforconsiderationoftheBoard.Interalia,thefollowinginformation,asmaybeapplicableandrequired,isregularlyprovidedtotheBoardasapartoftheagendapaperswellinadvanceoftheBoardMeetingsoristabledinthecourseoftheBoardMeetings:

• Annualoperatingplansandbudgets

• Capitalbudget-purchaseanddisposalofplant,machineryandequipments

• Quarterly,halfyearlyandannualresultsoftheCompany

Table 1: Details of the Board of Directors

NameofDirectors Position Meetings Meetings Whether Numberof CommitteePositions# Pecuniaryor held attended attended directorshipof businessrelation lastAGM otherpublic withtheCompany companies(excluding foreigncompanies) ChairmanMember

AjitGulabchand Promoter, Chairmanand Managing Director 9 9 Yes 14 1 3 N.A.

Y.H.Malegam Independent Director 9 8 Yes 7 5 2 None

RajasR.Doshi Independent Director 9 9 Yes 4 1 4 None

D.M.Popat Independent Partnerof Director 9 6 Yes 3 - - Mulla&Mulla &Craigie Blunt&Caroe Solicitorsto theCompany

K.G.Tendulkar* Non-Executive Director 9 8 Yes 9 1 3 N.A.*

RamP.Gandhi Independent Director 9 7 Yes 5 1 1 None

Fred Non-Executive TechnicalMoavenzadeh Director 9 2 No - - - Consultant

SharadM.Kulkarni Independent Director 9 8 Yes 10 5 3 None

NirmalP.Bhogilal Independent Director 9 7 Yes 2 - 2 None

AnilC.Singhvi Independent Director 9 9 Yes 3 - 3 None

Table 1givesthedetailsoftheDirectorsAttendance,DirectorshipsheldinotherCompaniesandCommitteePositions.

25

• MinutesoftheMeetingsoftheAuditCommitteeandotherCommitteesoftheBoard

• InformationonrecruitmentandremunerationofseniorofficersjustbelowtheBoardlevel

• Materiallyimportantshowcause,demand,prosecutionnoticesandpenaltynotices,ifany

• Fatalorseriousaccidents,dangerousoccurrences,anymaterialeffluentorpollutionproblems

• AnymaterialdefaultinfinancialobligationstoandbytheCompany,orsubstantialnon-paymentsbyclients

• Anyissue,whichinvolvespossiblepublicorproductliability/claimsofsubstantialnature,includinganyjudgmentsororderswhichmayhavepassed,stricturesontheconductoftheCompanyoradverseviewsregardinganotherenterprisethatcanhavenegativeimplicationsontheCompany

• Detailsofanyjointventureagreementorcollaborationagreement

• Transactionsthatinvolvesubstantialpaymenttowardsgoodwill,brandequityorintellectualproperty

• Significantlabourproblemsandtheirproposedsolutions.Anysignificantdevelopmentinhumanresourcesorontheindustrialrelationsfrontsuchassigningofwageagreement,etc.

• Saleofmaterialnatureofinvestments,subsidiaries,assets,whicharenotinthenormalcourseofbusiness

• Quarterlydetailsofforeignexchangeexposureandthestepstakenbythemanagementtolimittheriskofadverseexchangeratemovement,ifmaterial

• Non-complianceofanyregulatory,statutoryorlistingrequirementandshareholders’servicesuchasnon-paymentofdividend,delayinsharetransfer,etc.

TheBoardperiodicallyreviewscompliancereportsofalllawsapplicabletotheCompany,preparedbythemanagementaswellasstepstakenbytheCompanytorectifyinstancesofnon-compliances,ifany.Inadditiontotheabove,pursuanttotheClause49,theMinutesoftheBoardMeetingsoftheCompany’sUnlistedSubsidiaryCompaniesandastatementofallsignificanttransactionsandarrangementsenteredintobytheUnlistedSubsidiaryCompaniesarealsoplacedbeforetheBoard.TheBoardalsoreviewsthefinancialstatementsoftheUnlistedSubsidiaryCompanies.

(e) Directors with pecuniary relationship or business transaction with the Company

AllExecutiveDirectorsreceivesalary,allowances,perquisitesandcommission,whilealltheNon-ExecutiveDirectorsreceivesittingfeesandcommission.Inaddition,Non-ExecutiveDirector,namely,Prof.FredMoavenzadehreceivestechnicalfees,detailsofwhicharegiveninTable 2.

(f) Remuneration to Directors

Table 2givesdetailsoftheremunerationpaid/payabletotheDirectorsforthefinancialyear2009-10.

Table 2: Remuneration paid/payable to Directors

NameofDirectors Sittingfees* Salaries, Commission Technicalfees# Total No.of allowances& stockoptions perquisites+ granted

AjitGulabchand NIL 6,11,50,000 NIL - 6,11,50,000 NIL

Y.H.Malegam 1,60,000 - 6,00,000 - 7,60,000 34,300

RajasR.Doshi 3,40,000 - 6,00,000 - 9,40,000 34,300

D.M.Popat 1,20,000 - 6,00,000 - 7,20,000 34,300

K.G.Tendulkar$ 1,40,000 3,61,30,435 2,40,000 - 3,65,10,435 6,17,600

RamP.Gandhi 4,60,000 - 6,00,000 - 10,60,000 34,300

FredMoavenzadeh 40,000 - 6,00,000 24,09,000 30,49,000 34,300

SharadM.Kulkarni 2,80,000 - 6,00,000 - 8,80,000 34,300

NirmalP.Bhogilal 1,80,000 - 6,00,000 - 7,80,000 34,300

AnilC.Singhvi 4,20,000 - 6,00,000 - 10,20,000 34,300

Notes.

*SittingfeesincludepaymenttotheDirectorsforattendingmeetingsofBoardCommittee.

+PerquisitesincludeCompany’scontributiontoprovidentfundandsuperannuationfund.

#Professionalfeespaidforrenderingtechnicalservices(excludingServiceTax).

$MrK.G.TendulkarretiredasDeputyManagingDirectoroftheCompanyon7thNovember,2009andwasappointedasanAdditionalDirectorwitheffectfrom8thNovember,2009.CommissiontoMr.K.G.Tendulkarisonpro-ratabasis.

(Amount in Rs.)

26

During2009-10,theCompanydidnotadvanceanyloanstoanyofitsDirectors.

ThetermsofemploymentoftheChairmanandManagingDirectorstipulateaseverancenoticeofsixmonthsoneitherside.

Ms.ShalakaGulabchandDhawan,VicePresident(BusinessDevelopment)oftheCompanyisthedaughterofMr.AjitGulabchand,ChairmanandManagingDirectoroftheCompany.Thegrossremunerationpaidtoherduring2009-10wasRs.64.80LacsasapprovedbythemembersandtheGovernmentofIndia.

Duringtheyear,Mr.ArjunDhawanwasappointedPresidentofHCC’sinfrastructurebusiness.Heisson-in-lawofMr.AjitGulabchand,ChairmanandManagingDirectoroftheCompany.Thegrossremunerationpayabletohimduring2009-10wasRs.40.00LacsasapprovedbythemembersandsubjecttotheapprovalofCentralGovernment.

(g) Code of Conduct

TheBoardofDirectorshaslaiddowntwoseparatecategoriesofCodesofConduct-onefortheNon-ExecutiveDirectorsandtheotherfortheExecutiveDirectorsandthedesignatedemployeesintheseniormanagement.CopiesofboththeCodesofConductareavailableonthewebsiteoftheCompany:www.hccindia.com.AlltheBoardmembersandseniormanagementexecutivesoftheCompanyhaveaffirmedcompliancewiththeCodeofConductasapplicabletothem.

AdeclarationtothiseffectsignedbyMr.AjitGulabchand,ChairmanandManagingDirectorisannexedtothisReport.

II)BoardCommitteesHCChasfive(5)Board-levelCommittees-AuditCommittee,RemunerationCommittee,Shareholders’/Investors’GrievanceCommittee,ESOPCompensationCommitteeandSelectionCommittee.AlldecisionspertainingtotheconstitutionofCommittees,appointmentofmembersandfixingoftermsofreferenceoftheCommitteesaretakenbytheBoardofDirectors.DetailsontheroleandcompositionoftheseCommittees,includingthenumberofmeetingsheldduringthefinancialyearandtherelatedattendance,areprovidedbelow:

(a) Audit Committee

Ason31stMarch,2010,theAuditCommitteeconsisted

Nameofthemember Category Position No.of No.ofmeetings Sittingfees meetingsheld attended paid(Rs.)

SharadM.Kulkarni IndependentDirector Chairman 4 4 80,000

RamP.Gandhi IndependentDirector Member 4 4 80,000

RajasR.Doshi IndependentDirector Member 4 4 80,000

AnilC.Singhvi IndependentDirector Member 4 4 80,000

Table 3: Details of the Audit Committee

offourIndependentDirectors-Mr.SharadM.Kulkarni-(Chairman),Mr.RamP.Gandhi,Mr.RajasR.DoshiandMr.AnilC.Singhvi.ThetermsofreferenceoftheAuditCommitteeisinconformitywiththosementionedinClause49oftheListingAgreementoftheStockExchangesaswellasSection292AoftheCompaniesAct,1956.

TheAuditCommitteemetfour(4)timesduringtheyearon23rdApril,2009,23rdJuly,2009,22ndOctober,2009,and21stJanuary,2010.TheminutesofthemeetingsoftheAuditCommitteearereviewedandnotedbytheBoard.ThecompositionoftheCommitteeandtheattendanceatthemeetingsoftheCommitteearegiveninTable 3.

TheDirectorsresponsibleforthefinancefunction,thePresidentandChiefOperatingOfficer,GroupChiefFinancialOfficer,theheadofinternalauditandtherepresentativeofthestatutoryauditorsareregularlyinvitedbytheAuditCommitteeatitsMeetings.Mr.V.P.Kulkarni,CompanySecretaryistheSecretarytotheCommittee.

AllMembersoftheAuditCommitteehaveaccountingandfinancialmanagementexpertise.TheChairmanoftheAuditCommitteeattendedtheAnnualGeneralMeeting(AGM)heldon12thJune,2009toanswershareholders’queries.

ThefunctionsoftheAuditCommitteeoftheCompanyincludethefollowing:

• OverseeingtheCompany’sfinancialreportingprocessanddisclosureofitsfinancialinformationtoensurethatthefinancialstatementsarecorrect,sufficientandcredible

• RecommendingtotheBoard,theappointment,re-appointmentand,ifrequired,thereplacementorremovalofthestatutoryauditorandthefixationofauditfees

• Approvalofpaymenttostatutoryauditorsforanyotherservicesrenderedbythem

• Reviewingwiththemanagement,theannualfinancialstatementsbeforesubmissiontotheBoardforapproval,withparticularreferenceto:

- MattersrequiredtobeincludedintheDirector’sResponsibilityStatementtobeincludedintheBoard’sReportintermsofClause(2AA)ofSection217oftheCompaniesAct,1956

- Changes,ifany,inaccountingpoliciesandpracticesandreasonsforthesame

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- Majoraccountingentriesinvolvingestimatesbasedontheexerciseofjudgementbythemanagement

- Significantadjustmentsmadeinthefinancialstatementsarisingoutofauditfindings

- Compliancewithlistingandotherlegalrequirementsrelatingtofinancialstatements

- Disclosureofanyrelatedpartytransactions

- Qualificationsinthedraftauditreport

• Reviewingwiththemanagement,quarterly,halfyearlyandyearlyfinancialstatementsbeforesubmissiontotheBoardforapproval

• Reviewingwiththemanagement,performanceofthestatutoryandinternalauditorsandadequacyoftheinternalcontrolsystems

• Reviewingtheadequacyofinternalauditfunction,ifany,includingthestructureoftheinternalauditdepartment,staffingandseniorityoftheofficialheadingthedepartment,reportingstructurecoverageandfrequencyofinternalaudit

• Discussionwiththeinternalauditorsofanysignificantfindingsandfollow-upthereon

• ReviewingthefindingsofanyinternalinvestigationsbytheinternalauditorsintomatterswherethereissuspectedfraudorirregularityorafailureofinternalcontrolsystemsofamaterialnatureandreportingthemattertotheBoard

• Discussionswiththestatutoryauditorsbeforetheauditcommences,aboutthenatureandscopeoftheauditaswellaspost-auditdiscussionstoascertainanyareasofconcern

• Tolookintothereasonsforsubstantialdefaultsifany,withregardtothepaymenttodepositors,debentureholders,shareholders(incaseofnon-paymentofdeclareddividends)andcreditors

• CarryingoutanyotherfunctionsasmentionedinthetermsofreferenceoftheAuditCommittee

TheAuditCommitteeisempowered,pursuanttoitstermsofreference,to:

• Investigateanyactivitywithinitstermsofreference

• Itcanseekinformationfromanyemployees

• Itcanobtainoutsidelegalorotherprofessionaladvice

• Tosecureattendanceofoutsiderswithrelevantexpertise,wheneverconsiderednecessary

HCChassystemsandproceduresinplacetoensurethattheAuditCommitteemandatorilyreviews:

• Managementdiscussionandanalysisoffinancialconditionandresultsofoperations

• Statementofsignificantrelatedpartytransactions(asdefinedbytheauditcommittee)submittedbymanagement

• Managementletters/ lettersofinternalcontrolweaknessissuedbythestatutoryauditors

• Internalauditreportsrelatingtointernalcontrolweakness

• Theappointment,removalandtermsofremunerationoftheChiefInternalAuditor

• Theuses/applicationsoffundsraisedthroughpublicissues,rightissues,preferentialissuesbymajorcategory(Capitalexpenditure,workingcapital,etc.)aspartofthequarterlydeclarationsoffinancialresults

• Ifapplicable,onanannualbasis,statementscertifiedbythestatutoryauditors,detailingtheuseoffundsraisedthroughpublicissues,rightsissues,preferentialissuesforpurposesotherthanthosestatedintheofferdocuments/prospectus/notices

Inaddition,theAuditCommitteeoftheCompanyalsoreviewsthefinancialstatementsinparticular,theinvestmentsmadebytheUnlistedSubsidiaryCompanies.

TheAuditCommitteeisalsoappraisedoninformationwithregardtorelatedpartytransactionsandperiodicallypresentedwiththefollowingstatements/details:

1. Statementinsummaryformoftransactionswithrelatedpartiesintheordinarycourseofbusiness.

2. Detailsofmaterialindividualtransactionswithrelatedpartiesintheordinarycourseofbusiness.

3. Detailsofmaterialindividualtransactionswithrelatedpartiesorothers,whicharenotanarm’slengthbasisalongwithmanagement’sjustificationforthesame.

(b) Remuneration Committee

Althoughitisanon-mandatoryrecommendationunderClause49oftheListingAgreement,theCompanyhasaRemunerationCommitteecomprisingthree(3)IndependentDirectors-Mr.NirmalP.Bhogilal-Chairman,Mr.RamP.GandhiandMr.AnilC.Singhvi.TheRemunerationCommitteemetonceduringthefinancialyearon24thApril,2009.ThecompositionoftheCommitteeandtheattendanceoftheMembersattheMeetingsoftheCommitteearegiveninTable 4.TheMinutesoftheRemunerationCommitteeMeetingsarereviewedandnotedbytheBoard.

RemunerationPolicyTheRemunerationCommitteerecommendstotheBoardthecompensationpackageoftheExecutiveDirectorsoftheCompany.TheCommitteealsorecommendsthecompensationpayabletotheNon-ExecutiveDirectorsinaccordancewiththeprovisionscontainedintheCompaniesAct,1956.TheremunerationoftheExecutiveDirectorsarewithintheceilingslaiddownbyScheduleXIIIoftheCompaniesAct,1956.TheNon-ExecutiveDirectorsarepaidsittingfeesforattendingtheMeetingsoftheBoardofDirectorsandCommitteeswithintheceilingprescribedbytheCentralGovernment.

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Table 6: Details of queries and grievances received and attended during the financial year 2009-10

NatureofQueries/Complaints Pendingas Receivedduring Redressedduring Pendingason on1stApril,2009 theyear theyear 31stMarch,2010

1. Transfer/ Transmission/ IssueofDuplicateShareCertificates Nil 56 56 Nil

2. Non-receiptofDividend Nil 936 936 Nil

3. Dematerialisation /RematerialisationofShares Nil 8 8 Nil

4. Complaintsreceivedfrom:

a. SecuritiesandExchangeBoardofIndia Nil 1 1 Nil

b. StockExchange(s)/NSDL/CDSL Nil 5 5 Nil

c. RegistrarofCompanies/MinistryofCorporateAffair/Others Nil Nil Nil Nil

5. Others Nil 524 524 Nil

Grand Total Nil 1530 1530 Nil

Table 5: Details of the Shareholders'/Investors' Grievance Committee

Nameofthemember Category Position No.of No.ofmeetings Sittingfees meetingsheld attended paid(Rs.)

RamP.Gandhi IndependentDirector Chairman 4 4 80,000

RajasR.Doshi IndependentDirector Member 4 4 80,000

AjitGulabchand Chairman&Managing Director Member 4 4 -

K.G.Tendulkar Non-ExecutiveDirector Member 4 4 20,000

CommissionasapprovedbytheShareholdersfromtimetotimeisdistributedequallytoalltheNon-ExecutiveDirectorsoftheCompany.

(c) Shareholders' / Investors' Grievance Committee

TheShareholders’/Investors’GrievanceCommitteeoftheCompanycomprisesoffourDirectors;namely,Mr.RamP.Gandhi,ChairmanandanIndependentDirector,Mr.RajasR.Doshi,IndependentDirector,Mr.AjitGulabchand,ChairmanandManagingDirectorandMr.K.G.Tendulkar,Non-ExecutiveDirector.TheCompanySecretary,Mr.V.P.KulkarniistheComplianceOfficer.

TheShareholders’/Investors’GrievanceCommitteedealswithvariousmattersrelatingto:

• Notingoftransfer/ transmissionofshares

• Reviewofsharesdematerialised / rematerialisedandallotherrelatedmatters

• MonitorsexpeditiousredressalofInvestors’grievancesreceivedfromStockExchanges,SEBI,ROC.,etc.

• Non-receiptofAnnualReportsanddividend

• AllothermattersrelatedtoShares/Debentures

During2009-10,theCommitteemetfour(4)timeson23rdApril,2009,23rdJuly,2009,22ndOctober,2009,and21stJanuary,2010.TheMinutesoftheShareholders’/Investors’GrievanceCommitteearereviewedandnotedbytheBoard.ThedetailsofattendanceattheMeetingsoftheCommitteearegivenin Table 5.

Atotalof1530queries/complaintswerereceivedbytheCompanyfromshareholders/investorsduring2009-10asdetailedbelow.AllthecomplaintswereresolvedbytheCompanytothesatisfactionoftheinvestorsandason31stMarch,2010,therewerenopendinglettersorcomplaints.

DetailsofqueriesandgrievancesreceivedandaddressedbytheCompanyduringtheyear2009-10aregiveninTable 6.

No.of No.of Sittingfees Nameofthemember Category Position meetingsheld meetingsattended paid(Rs.)

NirmalP.Bhogilal Independent Chairman 1 1 20,000

RamP.Gandhi Independent Member 1 1 20,000

AnilC.Singhvi Independent Member 1 1 20,000

Table 4: Details of the Remuneration Committee

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Table 7: Details of the ESOP Compensation Committee

Nameofthemember Category Position No.ofmeetings No.ofmeetings Sittingfees held attended paid(Rs.)

SharadM.Kulkarni IndependentDirector Chairman 2 2 40,000

RamP.Gandhi IndependentDirector Member 2 2 40,000

K.G.Tendulkar Non-ExecutiveDirector Member 2 2 -

Table 8: Shares and Stock Options held by Non-Executive Directors as on 31st March, 2010.

NameofDirector No.ofshares No.ofstockoptionsgranted

Y.H.Malegam 5,000 34,300

RajasR.Doshi 16,000 34,300

RamP.Gandhi 24,000 34,300

D.M.Popat Nil 34,300

FredMoavenzadeh Nil 34,300

SharadM.Kulkarni Nil 34,300

NirmalP.Bhogilal 1,93,900 34,300

K.G.Tendulkar 10,000 6,17,600

AnilC.Singhvi 10,000 34,300

(d) ESOP Compensation Committee

TheESOPCompensationCommitteecomprisesthreeDirectors;namely,Mr.SharadM.Kulkarni,ChairmanandIndependentDirector,Mr.RamP.Gandhi,IndependentDirector,andMr.K.G.Tendulkar,Non-ExecutiveDirector.

TheESOPCompensationCommitteedealswithvariousmattersrelatingto:

a) ThenumberofoptionstobegrantedundertheSchemeperemployeeandinaggregate.

b) Theconditionsunderwhichoptionvestedinemployeesmaylapseincaseofterminationofemploymentformisconduct.

c) Theexerciseperiodwithinwhichtheemployeeshouldexercisetheoptionandthatoptionwouldlapseonfailuretoexercisetheoptionwithintheexerciseperiod.

d) Thespecifiedtimeperiodwithinwhichtheemployeeshallexercisethevestedoptionsintheeventofterminationorresignationofanemployee.

e) Therightofanemployeetoexercisetheoptionsvestedinhimatonetimeoratvariouspointsoftimewithintheexerciseperiod.

f) Theprocedureformakingafairandreasonableadjustmenttothenumberofoptionsandtotheexercisepriceincaseofcorporateactionssuchasrightsissues,bonusissues,merger,saleofdivisionandothers.

g) Thegrant,vestandexerciseofoptionincaseofemployeeswhoareonlongleave.

h) FringeBenefitTaxonissueofoptionsortheSharesuponexerciseoftheoptionsasmaybeapplicable.

I) Allotmentofsharesuponexerciseofoptions.

During2009-10,theCommitteemettwiceon23rdApril,2009,and20thJuly,2009.TheMinutesoftheESOPCompensationCommitteearereviewedandnotedbytheBoard.ThedetailsofattendanceattheMeetingsoftheCommitteearegiveninTable 7.

Re-pricingofEmployeeStockOptionsInaccordancewiththeapprovaloftheBoardofDirectorsandtheShareholdersoftheCompanytheESOPCompensationCommitteeatitsmeetingheldon20thJuly,2009,re-pricedthe41,31,600options(afteradjustingforoptionslapsed)alreadygrantedbytheCompanyon25thApril,2008.

Theoptionshavebeenre-pricedatRs.104.05peroption(earlierRs.132.50peroption).

Shares and Convertible instruments held by the Non-Executive Directors

Table 8givesdetailsoftheEquitySharesandoptionsheldbytheNon-ExecutiveDirectorsason31stMarch,2010.

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(e) Selection Committee

TheBoardofDirectorsoftheCompanyatitsmeetingheldon24thJuly,2009,constitutedaSelectionCommitteetodealwithmattersconcerningtheappointmentandremunerationofrelativeofDirectorsforholdingofficeorplaceofprofitintheCompany.

TheCompany'sSelectionCommitteecomprisesthreeDirectors;namely,Mr.NirmalP.Bhogilal,ChairmanandIndependentDirector,Mr.RamP.Gandhi,IndependentDirector,Mr.AnilSinghvi,IndependentDirector.TheboardhasalsoappointedMr.AshishSingh,who

isnotaDirectororanemployeeoftheCompanyasanindependantmember.Mr.AshishSingh,anexpert,whoisaMBAfromHarvardBusinessSchoolandB.A.EconomicsfromHarvardCollege.HeistheManagingDirectorofBain&Co.,India,withsignificantexperienceinorganisationre-designacrossmultipleindustries.

Duringtheyear2009-10,theSelectionCommitteemetonceon23rdOctober,2009.TheMinutesoftheSelectionCommitteearereviewedandnotedbytheBoard.ThedetailsofattendanceattheMeetingsoftheCommitteearegiveninTable 9.

Table 9: Details of the Selection Committee

Nameofthemember Category Position No.ofmeetings No.ofmeetings Sittingfees held attended paid(Rs.)

NirmalP.Bhogilal IndependentDirector Chairman 1 1 20,000

RamP.Gandhi IndependentDirector Member 1 1 20,000

AnilC.Singhvi IndependentDirector Member 1 1 20,000

AshishSingh Member Expert 1 1 20,000

Airport Metro Express Line-1, Delhi Metro Rail

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III)Management

Management Discussion and Analysis Report

ManagementDiscussionandAnalysisisgiveninaseparatesectionformingpartoftheDirectors’ReportinthisAnnualReport.

Disclosures

(a) Related Party Transactions

Detailsofmateriallysignificantrelatedpartytransactionsi.e.transactionsoftheCompanyofmaterialnaturewithitspromoters,theDirectorsorthemanagement,theirsubsidiariesorrelatives,etc.arepresentedunderNote27inScheduleQoftheBalanceSheet.Alldetailsonthefinancialandcommercialtransactions,whereDirectorsmayhaveapotentialinterest,areprovidedtotheBoard.TheinterestedDirectorsneitherparticipatedinthediscussion,norvotedonsuchmatters.

(b) Accounting treatment in preparation of financial statements

TheCompanyhasfollowedtheguidelinesofaccountingstandardslaiddownbytheInstituteofCharteredAccountantsofIndia(ICAI)inpreparationofitsfinancialstatements.

(c) Risk Management

TheCompanyhasestablishedawell-documentedandrobustriskmanagementframework.Underthisframework,risksareidentifiedacrossallbusinessprocessesoftheCompanyoncontinuousbasis.Onceidentified,theserisksaresystematicallycategorisedasstrategicrisks,businessrisksorreportingrisks.TheformerlooksatallrisksassociatedwiththelongerterminterestsoftheCompany.Thelatterlookatrisksassociatedwiththeregularfunctioningofeachoftheprocessesandtherisksassociatedwithincorrectoruntimelyfinancialandnon-financialreporting.

Toaddresstheserisksinacomprehensivemanner,eachriskismappedtotheconcerneddepartmentforfurtheraction.Basedonthisframework,theCompanyhassetinplacevariousproceduresforRiskManagement.

(d) Subsidiary Companies

HCCRealEstateLimited(HREL)andLavasaCorporationLtd.(Lavasa)areHCC’s‘materialnon-listedsubsidiaries’,definedunderClause49oftheListingAgreementasanunlistedsubsidiary,incorporatedinIndia,whoseturnoverornetworth(i.e.paid-upcapitalandfreereserve)exceeds20%oftheconsolidatedturnoverornetworthrespectively,oftheCompanyanditssubsidiariesintheimmediatelyprecedingaccountingyear.

HRELandLavasa’snetworthexceeds20%oftheconsolidatednetworthoftheCompanyanditssubsidiaries.

OneoftheIndependentDirectorsofHCCisamemberontheBoardofHRELandLavasa.

TheCompanymonitorstheperformanceofitssubsidiaries,interalia,bythefollowingmeans:

• TheFinancialStatements,inparticulartheinvestmentsmadebytheunlistedsubsidiarycompanies,arereviewedbytheCompany’sAuditCommitteeaswellasbytheBoard

• TheMinutesofthesubsidiarycompaniesareperiodicallyplacedbeforeandreviewedbytheBoardofDirectorsoftheCompany

• DetailsofsignificanttransactionsandarrangementsenteredintobytheunlistedsubsidiarycompaniesareplacedbeforetheCompany’sBoard,asandwhenapplicable

(e) Code for Prevention of Insider Trading Practices

PursuanttotheSecuritiesandExchangeBoardofIndia,(ProhibitionofInsiderTrading)Regulations1992,acomprehensivecodeforpreventionofInsiderTradingisinplace.TheobjectiveoftheCodeistopreventpurchaseand/orsaleofsharesoftheCompanybyaninsideronthebasisofunpublishedpricesensitiveinformation.UnderthisCode,DirectorsanddesignatedemployeesarecompletelyprohibitedfromdealingintheCompany’ssharesduringtheclosureofTradingWindow.Todealinsecuritiesbeyondspecifiedlimit,permissionofComplianceOfficerismandated.AllthedesignatedemployeesarealsorequiredtodiscloserelatedinformationperiodicallyasdefinedintheCode.Mr.V.P.Kulkarni,CompanySecretary,hasbeendesignatedastheComplianceOfficer.

(f) CEO/CFO Certification

TheCEOandCFOcertificationofthefinancialstatementsfortheyearisappendedattheendofthereport.

(g) Pledge of Equity Shares

NopledgehasbeencreatedovertheequitysharesheldbythePromotersand/orPromoterGroupason31stMarch,2010.

TheaggregateshareholdingofthePromotersandpersonsbelongingtothePromoterGroupason31stMarch,2010,comprised12,08,67,197.EquitySharesofRe.1/-eachrepresenting39.86%ofthePaid-upEquityShareCapitaloftheCompany.

IV)Shareholders

(a) Disclosures regarding appointment & re-appointment of Directors

AttheensuingAnnualGeneralMeeting,Mr.D.M.PopatandMr.Y.H.Malegam,DirectorsoftheCompany,retirebyrotationandbeingeligible,offerthemselvesforre-appointment.

Mr.AnilC.SinghviwasappointedasaDirectorbytheBoardofDirectorsatitsmeetingheldon27thJuly,2007,tofillthecasualvacancycausedduetotheresignationofMr.R.G.Vartak,whowouldhaveretiredbyrotationattheensuingAnnualGeneralMeetinghadhenotresigned.

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Mr.AnilC.SinghvicanholdofficeuptotheensuingAnnualGeneralMeeting.TheCompany,inrespectofMr.AnilC.Singhvi,receivedNoticeunderSection257oftheCompaniesAct,1956,inwritingfromtheMembersignifyinghisintentiontoproposeMr.AnilC.SinghviasaDirectoroftheCompany.

Mr.K.G.TendulkarwasappointedasanAdditionalDirectoroftheCompanybytheBoardatitsmeetingheldon23rdOctober,2009,witheffectfrom8thNovember,2009andholdsofficeuptothedateoftheensuingAnnualGeneralMeeting.TheCompanyhasreceivedaNoticeinwritingunderSection257oftheCompaniesAct,1956fromaMembersignifyinghisintentiontoproposeMr.K.G.TendulkarasDirectoroftheCompany.

AbriefprofileoftheDirectorswhoarecomingupforappointmentandre-appointmentaregivenbelow:

D. M. Popat

D.M.Popat,B.Com,B.A.L.L.B,isaseniorpartnerofM/s.Mulla&Mulla&CraigieBlunt&Caroe.Hehasbeeninpracticeforover46yearsandhasavastexperienceinthelegalfield.HeisontheBoardofrenownedcompaniessuchasTheHindoostanSpg.&Wvg.MillsLtd.,PeninsulaLandLtd.(formerlyMorarjeeRealitiesLtd.),TheRubyMillsLtd.Mr.PopatismemberoftheManagingCommitteeoftheBombayIncorporatedLawSocietyandMemberofGoverningBodyoftheIndianCouncilofArbitration&ChairmanofLawsub-committeeofIMCandW.R.IndianCouncilofArbitration.

Y. H. Malegam

Y.H.Malegam,B.Com,F.C.A.(England&Wales),isaneminentCharteredAccountant.HeretiredasaSeniorPartnerofM/s.S.B.Billimoria&Co.,aleadingCharteredAccountantfirminIndia.HehasawideandrichexperienceinthefieldofFinance&Accounts.HeisontheBoardofseveralcompaniessuchasABCBearingsLtd.,TheClearingCorporationofIndiaLtd.,NationalStockExchangeofIndiaLtd.,NationalSecuritiesClearingCorporationLtd.,PiramalHealthCareLtd.,SiemensLtd.&FirstsourceSolutionsLtd.HeisalsoamemberoftheCentralBoardofWesternAreaLocalBoardofReserveBankofIndia,theInstituteofBankingFinanceandIndo-GermanChamberofCommerce.HeisalsoaDirectorofBharatiyaReserveBank-NoteMudran(P.)Ltd.

K. G. Tendulkar

K.G.Tendulkar,B.Com,BGL;FCA,hasover27yearsofexperienceinSeniorManagementasaConsultant.HehasrenderedservicesasaconsultantintheareasofTaxation,Finance,MIS,AuditingandContractManagement,andhasworkedasanExecutiveDirector(Operations)since1993andelevatedasaDy.Managing

DirectoroftheCompanyw.e.f.29thSeptember,2005.Mr.K.G.Tendulkar'stenureasaDy.ManagingDirectorexpiredon7thNovember,2009,andhewasappointedasanAdditionalDirectorfrom8thNovember,2009.Consequently,hebecameaNon-ExecutiveDirectoroftheCompany.HeisalsoontheBoardofHinconFinanceLtd.,HinconHoldingsLtd.,Pune-PaudTollRoadCompanyLtd.,HCCRealEstateLtd.,LavasaCorporationLtd.,HCCInfrastructureLtd.,HCCConstructionLtd.,CharosaWineriesLtd.,HighbarTechnologiesLtd.,HCCMauritiusEnterprisesLtd.andHCCSingaporeEnterprisesPte.Ltd.

Anil C. Singhvi

AnilSinghvi,isB.Com.,C.A.HeisViceChairmanofRelianceNaturalResourcesLtd.HewastheManagingDirectorofIcanInvestmentsAdvisorsPvt.Ltd.andearliertothat,hewastheManagingDirectorofAmbujaCementsLtd.HeisverycloselyassociatedwithSAMPARC-anon-governmentorganizationwhichworkstoempowertheneedychildren.HeisontheBoardofCamlinLtd.&MastekLtd.ApartfromthisheisalsoontheIndianAdvisoryBoardofHabitatforHumanity,anNGOinvolvedwithconstructionofHousesforneedyandpoorpeople.HehasalsoplayedapioneeringroleinestablishingtheIndianAssociationofCFOsandTreasurers(INACT)whichisabodyoftheCFOsofthemainlineIndianCorporates.

(b) Communication to Shareholders

EffectivecommunicationofinformationisanessentialcomponentofCorporateGovernance.TheCompanyregularlyinteractswiththeshareholdersthroughthemultiplechannelsofcommunicationsuchaspublicationofresults,AnnualReport,PressReleasesandtheCompany’sWebsite.

Quarterly,halfyearlyandannualresultsarepublishedinprominentdailynewspaperssuchasBusinessStandard(English)andSakal(Marathi)inalleditions.

TheCompanyalsoinformsStockExchangesinapromptmanner,allpricesensitiveandallsuchothermatterswhichinitsopinion,arematerialandrelevantfortheshareholdersandsubsequentlyissuesapressreleaseonthesaidmatters.Further,HCChasalsobeencomplyingwiththelistingrequirementsforfilingofitsfinancialresultsundertheEDIFARsystemofSEBI.TheseareavailableontheSEBIwebsite:www.sebiedifar.nic.in

TheCompany’swebsite-www.hccindia.com-containsinformationontheCompanyanditsperformance.Presentationstoanalysts,asandwhenmade,areimmediatelyputonthewebsiteforthebenefitoftheshareholdersandthepublicatlarge.TheSecretarialDepartment’semailissecretarial@hccindia.com

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FinancialYear Day,Date&Time Venue SpecialResolutionpassed

2006-07 Friday WalchandHirachandHall,Indian (1)ApprovaloftheShareholdersoftheCompanyfor 8thJune,2007 Merchants’Chambers,IndianMerchants Ms.ShalakaGulabchandDhawan,daughterof 11.30A.M. ChamberMarg,Churchgate, Mr.AjitGulabchand,ChairmanandManaging Mumbai-400020 DirectoroftheCompanytoholdandcontinueto holdofficeorplaceofprofitundertheCompanyas GeneralManager-BusinessDevelopmentunder Section314oftheCompaniesAct,1956.

(2)PaymentofCommissiontoNon-Executive DirectorsoftheCompanyforanamount notexceedinginaggregate1%ofthe netprofitoftheCompanyinanyfinancial yearunderprovisionofSection309(4)ofthe CompaniesAct,1956.

2007-08 Friday WalchandHirachandHall,Indian Nil 13thJune,2008. Merchants’Chamber,IndianMerchants 11.00A.M ChamberMarg,Churchgate, Mumbai-400020

2008-09 Friday WalchandHirachandHall,Indian Repricingof41,31,600Optionsgranted 12thJune,2009 Merchants’Chamber,Indian undertheEmployeeStockOptionScheme. 11.00A.M. MerchantsChamberMarg, Churchgate,Mumbai-400020

FinancialYear Day,Date&Time Venue SpecialResolutionpassed

2009-10 Monday WalchandHirachandHall,Indian Toobtaintheapprovalofshareholdersforraisingof 22ndJune,2009 Merchants’Chamber,IndianMerchants fundseitherthroughEquityShares /Depository 9.00A.M. ChamberMarg,Churchgate, Receipts / ConvertibleDebentures/ConvertibleBonds Mumbai-400020 /QIPforanamountnotexceedingRs.1500crore.

Details of Annual General Meetings during the last three years

Details of Special Resolutions passed at the Extraordinary General Meetings held during the last three financial years

Postal Ballot

Duringtheyear,apostalballotwasconductedpursuanttotheprovisionsofSection192AoftheCompaniesAct,1956,readwiththeCompanies(PassingoftheResolutionbyPostalBallot)Rules2001,onthespecialresolutionassetoutintheNoticedated23rdOctober,2009,seekingconsentofthemembersforMr.ArjunDhawan,arelative(son-in-law)ofMr.AjitGulabchand,ChairmanandManagingDirectoroftheCompany,toholdorcontinuetoholdanOfficeorPlaceofProfitasaPresident-HCCInfrastructureBusinessoftheCompany,underSection314(1B)oftheCompaniesAct,1956.

ThesaidresolutionwaspassedbytherequisitemajorityandtheresultofthepostalballotwasdeclaredbytheChairmanon9thDecember,2009.

Compliance:

i) Mandatory requirements

HCCisfullycompliantwiththeapplicablemandatoryrequirementsofClause49ofthelistingagreementexecutedwiththeStockExchanges.

iii) Auditors’ Qualification on Financial Statements

TheCompany’sfinancialstatementsarefreefromanyqualificationsbytheAuditors.

iv) Instances of non-compliance by the Company

NoPenalty/strictureswereimposedontheCompanybytheStockExchangesorSEBIoranyStatutoryAuthorityonanymatterrelatedtothecapitalmarketduringthelastthreeyears.

Auditors’ Certificate on Corporate Governance

TheCompanyhasobtainedacertificatefromitsStatutoryAuditorstestifyingtoitscomplianceswiththeprovisionsrelatingtoCorporateGovernancelaidoutinClause49oftheListingAgreementexecutedwiththeStockExchanges.ThecertificateisannexedtotheDirectors’ReportandthesamewillbesenttotheStockExchangesalongwiththeAnnualReporttobefiledbytheCompany.

ii) Adoption of non-mandatory requirements

Althoughitisnotmandatory,theBoardofHCChasconstitutedaRemunerationCommittee.DetailsoftheCommitteehavebeenprovidedunderSection‘RemunerationCommittee’.

GeneralBodyMeetingsTheCompanyconvenestheAnnualGeneralMeeting(AGM)generallywithinthreemonthsofthecloseofthefinancialyear.ThedetailsoftheAGMheldinlastthreeyearsaregivenbelow:

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I)AnnualGeneralMeetingDate:11thJune,2010Day:FridayTime:11.00a.mVenue:WalchandHirachandHall,IndianMerchants’Chamber,IndianMerchants’ChamberMarg,Churchgate,Mumbai-400020

Last date of Receipt of Proxies

Wednesday,9thJune,2010(before11:00a.m.attheRegisteredOfficeoftheCompany)

II)FinancialYearTheCompanyobservesthefinancialyearstartingfrom1stAprilto31stMarchasitsfinancialyear.TheBoardMeetingforapprovalofquarterly,halfyearlyandannualfinancialresultsduringtheyearended31stMarch,2010wereheldonthefollowingdates:1stQuarterlyResults:24thJuly,20092ndQuarterlyResults:23rdOctober,2009

TheCompanywillcontinuetouseNECS/ECSoranyotherElectronicmode.

Unclaimed Dividend

UndertheCompaniesAct,1956,dividendswhichremainunclaimedforaperiodof7yearsarerequiredtobetransferredtotheInvestorEducation&ProtectionFund(IEPF)administeredbytheCentralGovernment.

Datesofdeclarationofdividendssince2002-03andthecorrespondingdateswhenunclaimeddividendsareduetobetransferredtotheCentralGovernment,aregiveninthetable below.

Separatelettershavealreadybeensenton16thJanuary,2010,totheMemberswhoareyettoencashthedividendforthefinancialyear2002-03indicatingthattheunclaimedamountwillbetransferredtoIEPF,ifnotclaimedbythemembersbeforetheduedateoftransfertothesaidFund.Membersareonceagainrequestedtoutilizethisopportunityandgetintouchwiththe

AdditionalShareholders’Information

Financialyear Dateofdeclaration Amountremaining Lastdateforclaiming Lastdatefor ended ofdividend unclaimed /unpaidas unpaiddividend transfertoIEPF on31.03.2010(Rs.) amount(onorbefore)

31.03.2003 25.07.2003 7,59,704.00 29.08.2010 28.09.2010

31.03.2004 23.07.2004 9,01,377.00 27.08.2011 26.09.2011

31.03.2005 08.06.2005 10,00,806.00 14.07.2012 13.08.2012

31.03.2006 09.06.2006 11,25,658.00 14.07.2013 13.08.2013

31.03.2007 08.06.2007 16,91,672.25 13.07.2014 12.08.2014

31.03.2008 13.06.2008 14,73,351.20 18.07.2015 17.08.2015

31.03.2009 12.06.2009 21,26,801.60 17.07.2016 16.08.2016

3rdQuarterlyResults:22ndJanuary,20104thQuarterly&AnnualResults:30thApril,2010 ThetentativedatesoftheBoardMeetingsforconsiderationoffinancialresultsfortheyearending31stMarch,2011areasfollows:1stQuarterlyResults:30thJuly,20102ndQuarterlyResults:29thOctober,20103rdQuarterlyResults:21stJanuary,20114thQuarterlyAnnualResults:29thApril,2011

III)BookClosureTuesday,1stJune,2010,tillFriday,11thJune,2010(bothdaysinclusive)

IV)DividendBoardofDirectorsatitsMeetingheldon30thApril,2010,recommendedthedividendofRs. 0.80perEquityShareofRe.1/-eachforthefinancialyearended31stMarch,2010,forapprovaloftheshareholdersattheensuingAnnualGeneralMeeting.Ifapproved,thedividendwillbepaidonorafter11thJune,2010,butwithin7workingdaysfromtheAnnualGeneralMeeting.

Company’sRegistrarandShareTransferAgentM/s.TSRDarashawLtd.forenchasingtheunclaimeddividendsstandingtothecreditoftheiraccount.

Membersarefurtherrequestedtonotethataftercompletionof7years,noclaimsshalllieagainstthesaidFundorCompanyfortheamountsofdividendssotransferred,norshallanypaymentbemadeinrespectofsuchclaims.

V)ListingAtpresent,theEquitySharesoftheCompanyarelistedontheBombayStockExchangeLimited(BSE)andtheNationalStockExchangeofIndiaLimited(NSE).GDSsandFCCBarelistedwiththeLuxembourgStockExchange.

TheAnnualListingfeesfortheyear2010-11havebeenpaidtoNSEandBSE.

TheCompanyhaspaidcustodialfeesfortheyear2010-11toNationalSecuritiesDepositoryLimitedandCentralDepositoryServices(India)Limitedonthebasisofnumberofbeneficialaccountsmaintainedbythemason31stMarch,2010.

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Month BSE NSE

High(Rs.) Low(Rs.) Volume(No.ofshares) High(Rs.) Low(Rs.) Volume(No.ofshares)

April2009 68.50 39.20 4,07,94,441 67.00 39.25 10,34,30,049

May2009 119.55 53.50 5,32,08,234 119.85 57.00 14,42,66,441

June2009 128.90 90.80 4,05,81,046 129.40 90.70 12,94,37,766

July2009 120.75 88.80 4,56,15,028 120.90 88.60 13,80,87,179

August2009 121.50 100.20 17,047,319 121.50 100.20 5,98,31,474

September2009 136.70 103.55 3,46,47,083 136.70 103.30 10,28,60,514

October2009 146.50 117.50 2,72,89,590 146.35 117.50 9,00,58,781

November2009 149.85 119.10 1,98,91,307 149.80 118.65 6,95,12,261

December2009 155.00 133.85 1,17,99,461 153.50 133.00 4,42,12,429

January2010 162.20 124.20 1,37,27,107 162.20 124.15 5,11,70,513

February2010 142.20 124.30 76,03,113 142.40 123.30 3,66,79,070

March2010 149.70 132.10 68,78,519 149.80 132.20 3,10,64,953

VI)StockMarketdata

Table 2: High, lows and Volumes of HCC's for 2009-10 at BSE and NSE.

Chart AandChart BcompareHCCsharepriceswiththeNSENiftyandtheBSESensex,respectively

Note:

HCCSharepricesatNSEandNSENiftyindexedto100asonthefirstworkingdayofthe2009-10,i.e.1stApril,2009.

Note:

HCCSharepricesatBSEandBSESensexindexedto100asonthefirstworkingdayofthe2009-10,i.e.1stApril,2009.

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Chart B: HCC (BSE) Versus BSE SensexChart A: HCC (NSE) Versus Nifty

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VII)DistributionofshareholdingTable 3 and 4listthedistributionoftheshareholdingoftheEquitySharesoftheCompanybysizeandbyownershipclassason31stMarch,2010.

Table 5liststhetoptenshareholdersoftheCompanyason31stMarch,2010.

HCC(NSE) HCC-BSE

NIFTY SENSEX

ISIN(EquityShares) INE549A01026(NSDL&CDSL)

BSEcode 500185

NSEcode HCC

LuxembourgStockExchange

FCCB(ISIN) XS0248676503

GDSs(ISIN) US4332191026

Stock CodesTable 1: Stock Codes

36

Sr.No. NameoftheShareholder Category No.ofshares %oftotalcapital

1 HinconHoldingsLtd. Promoter 10,03,51,800 33.09

2 HSBCGlobalInvestmentFundsA/CHSBCGlobal InvestmentFundsMauritiusLimited FII 1,97,12,151 6.50

3 HinconFinanceLtd. Promoter 1,91,82,750 6.33

4 MorganStanleyMauritiusCompanyLimited FII 60,61,191 2.00

5 RelianceCapitalTrusteeCo.Ltd.-RelianceInfrastructureFund MutualFund 58,38,900 1.92

6 TheIndiaFund,Inc. FII 48,55,033 1.60

7 CopthallMauritiusInvestmentLimited FII 42,69,600 1.41

8 BNPParibasArbitrage FII 42,13,900 1.39

9 BirlaSunLifeInsuranceCompanyLimited BodiesCorporate 40,80,373 1.35

10 GoldmanSachsInvestments(Mauritius)Ltd. FII 34,95,348 1.15

Total 17,20,61,046 56.74

Table 5: Top Ten Shareholders of the Company as on 31st March, 2010

Table 4: Shareholding pattern by ownership as on 31st March, 2010

Categories

Ason31stMarch,2010 Ason31stMarch,2009

No.ofshares Percentage No.ofshares Percentage

Promoters,Directors,RelativesandAssociates 12,13,03,897 40.00 12,13,03,897 47.34

ForeignInstitutionalInvestor/MutualFunds 8,69,60,755 28.68 2,23,25,508 8.71

PublicF inancialInstitutions/State FinancialCorporation / InsuranceCompanies 43,00,087 1.42 1,00,44,156 3.92

MutualFunds(Indian)andUTI 3,39,15,277 11.18 3,71,34,653 14.49

NationalisedandotherBanks 3,07,328 0.10 3,68,027 0.15

NRI /OCBs 19,26,933 0.63 23,46,529 0.92

GDSs 1,40,146 0.05 1,40,146 0.05

Public 5,43,95,177 17.94 6,25,86,684 24.42

Total 30,32,49,600 100.00 25,62,49,600 100.00

Table 3: Distribution of shareholding as on 31st March, 2010

Distributionrangeofshares No.ofshares %ofshares No.ofshareholders %ofshareholders

1to500 1,13,79,608 3.75 91,723 85.68

501to1000 74,85,446 2.47 8,440 7.88

1001to2000 68,85,001 2.27 4,366 4.08

2001to3000 24,05,310 0.79 905 0.84

3001to4000 14,40,127 0.48 394 0.37

4001to5000 14,12,975 0.47 299 0.28

5001to10000 33,67,078 1.11 445 0.42

Greaterthan10000 26,88,74,055 88.66 485 0.45

Total 30,32,49,600 100.00 1,07,057 100.00

37

NumberofFCCBsissued 1000

NominalvalueofeachFCCB US$100,000

Totalvalueoftheissue US$100million

Re-purchasedandCancelledduringtheyear 34

NumberofFCCBsoutstanding 966

TotalvalueofFCCBsoutstanding US$96.6million

Conversion TheFCCBsareconvertibleintoEquitySharesor GlobalDepositoryShares(GDSs)

ConversionPrice Rs.246.02perEquityShare

Tenure 5years,1day

Couponrate 0%

Yieldofmaturity 6.50%

Maximumnumberofequityshares/GDSstobeissuedonconversion 1,75,04,381

Listing LuxembourgStockExchange

Table 6: Details of FCCBs

VIII)DematerialisationofSharesAson31stMarch,2010,29,80,91,369EquitySharesrepresenting98.30%ofthetotalequitycapitaloftheCompanywereheldindematerialisedform.

ThebifurcationofsharesheldinPhysicalandDematformason31stMarch,2010,isgivenbelow:

Particulars No.ofshares Percentage

Physical Segment 51,58,231 1.70

Demat Segment

NSDL 28,99,82,215 95.63

CDSL 81,09,154 2.67

Total 30,32,49,600 100

Theentirepromoters’holdingofsharesisindematform.

IX)DetailsofpublicfundingobtainedinthelastthreeyearsDuring2009-10,theCompanyhasallotted4,70,00,000EquitySharesofRe.1/-eachatapremiumofRs.101.15perEquitySharetoQualifiedInstitutionalBuyersaggregatingtoRs.4,80,10,50,000/-bywayofQualifiedInstitutionalPlacement(QIP).

X)OutstandingGDSs/FCCBsandlikelyimpactonEquityTheCompanyissuedGlobalDepositoryShares(GDSs)andForeignCurrencyConvertibleBonds(FCCBs)in2006andtheunderlyingsharesagainsteachoftheGDSswereissuedinthenameofCitiBankN.A.,thedepository.Ason31stMarch,2010,1,40,146GDSswereoutstandingandrepresentedanequalnumberofunderlyingequityshares.

DetailsoftheFCCBsissuedbytheCompanyaregiveninTable 6.

Duringtheyearunderreview,noneoftheFCCBshasbeenconvertedintotheEquitySharesoftheCompany.However,theCompanyhasre-purchasedandcancelled3.4%ofitsoutstandingFCCBsdue2011ofUSD1,00,000eachaggregatingtoUSD3.4million(NominalValue)inaccordancewiththeGuidelinesprescribedbyReserveBankofIndia.

ThenominalamountofFCCBsoutstandingasonthedateofthisReportisUSD96.6million.

Ason31stMarch,2010,therewere966FCCBsoutstandingconvertibleto1,75,04,381EquitySharesofRe.1/-eachwithinthestipulatedtimeframe.

XI)OutstandingConvertibleInstruments

a) Warrants issued to Promoters

TheCompanyhadallotted75,00,000warrantstothePromotersoftheCompanyconvertibleinto75,00,000EquitySharesatapriceofRs. 202.50perEquityShare(includingpremiumofRs.201.50perEquityShare)onpreferentialbasison20thDecember,2007,andwhichweredueforconversiononorbefore19thJune,2009.

ThePromotershavenotoptedfortheconversionofthe75,00,000warrantsintotheEquitySharesontheabovementionedduedateandhencethesubscriptionamountmoneyagainstthesharewarrantswereforfeitedandwarrantsissuedtothePromoterswerecancelled.

Ason31stMarch,2010,therearenooutstandingwarrants.

b) Employees Stock Options

Ason31stMarch,2010,thereare43,25,350optionsoutstanding.Eachoption,whenexercised,wouldbeconvertedintooneEquityShareoftheCompanyofRe.1/-eachfullypaid.

38

Duringtheyearunderreview,7,70,880optionswerevestedtotheemployeesoftheCompany.

XII)ListingofDebtSecuritiesPursuanttothedirectionsofSecuritiesandExchangeBoardofIndia(SEBI),allthedebtsecuritiesissuedbytheCompanyonPrivatePlacementbasishavebeenlistedintheFGroup-DebtInstrumentsoftheBombayStockExchangeLimited(BSE).

Duringtheyearunderreview,theCompanyhasnotissuedanydebentures.

Further,duringthefinancialyear2009-10,theCompanyhasfullyredeemed10%Non-ConvertibleDebentures“E”SerieshavingafacevalueofRs.100/-eachamountingtoRs.5,00,00,000/-

9%Non-ConvertibleDebentureshavingafacevalueofRs.10,00,000/-havebeenpartlyredeemedanditsfirstinstallmentofredemptionofRs. 3,33,333perdebentureshasbeenpaidtotheholders.

XIII)InvestorSafeguardsInvestorsmaynotethefollowingtoavoidrisks,whiledealinginsecurities:

• Dematerialisation of Shares

Membersmayconverttheirphysicalholdingtodemat/electronicformthroughanyofthenearestDepositoryParticipants(DPs)toavoidthehasslesinvolvedinthephysicalsharessuchaspossibilityofloss,mutilation,etc.andalsotoensuresafeandspeedytransactioninsecurities.

• National Electronic Clearing Services (NECS) /Electronic Clearing Services (ECS) mandate

NECS/ECShelpsinquickremittanceofdividendwithoutpossibleloss /delayinpostaltransit.MembersmayregistertheirNECS/ECSdetailswiththeCompanyortheirrespectiveDPs.

• Encash Dividends in time

Encashyourdividendspromptlytoavoidhasslesofrevalidation / losingrightofclaimowingtotransferofunclaimeddividendsbeyondsevenyearstoInvestorEducationandProtectionFund.

• Update Address

Toreceiveallcommunicationspromptly,pleaseupdateyourregisteredaddresswiththeCompany.

• Consolidate your Multiple Folios (Physical)

Membersarerequestedtoconsolidatetheirshareholdingundermultiplefoliostosavethemfromtheburdenofreceivingmultiplecommunicationsandcorporatebenefits.

• Register Nominations

Toenablesuccessorstogetthesharestransmittedin

theirfavourwithouthassle,themembersmayregistertheirnomination.Member(s)desirousofavailingthisfacilitymaysubmitnominationinForm2BwhichcanbeobtainedfromTSRDarashawLimitedattheaddressmentionedbelow.Member(s)holdingsharesinDematerialisedformarerequestedtoregistertheirnominationsdirectlywiththeirrespectiveDPs.

• Prevention of Frauds

Therearecertaininstancesoffraudulenttransactionsobserved,relatingtodormantfolios,wheretheshareholderhaseitherexpiredorhasgoneabroad.MembersmaythusexerciseduediligenceandnotifytheCompanyofanychangeinaddress /stayabroadordemiseofanyshareholderassoonaspossible.Donotleavethedemataccountdormantforlong.PeriodicstatementofholdingsshouldbeobtainedfromtheconcernedDPandholdingsshouldbeverified.

• Dealing of Securities with Registered Intermediaries

MembersmustensurethattheydealwithonlySEBIregisteredintermediariesandmustobtainavalidcontractnote /confirmationmemofromthebroker/sub-broker,within24hoursofexecutionofthetradeanditshouldbeensuredthatthecontractnote /confirmationmemocontainsorderno.,tradeno.,tradetime,quantity,priceandbrokerage.

ShareholdersmaycontacttheCompany’sRegistrarandShareTransferAgentortheymaycontacttheComplianceOfficerand /ortheInvestorRelationsOfficeratthefollowingaddresses:

Registrar and Transfer Agent

Ms.MaryGeorgeTSRDarashawLimitedUnit:HindustanConstructionCo.Ltd.6-10,HajiMoosaPatrawalaInd.Estate,20,Dr.E.MosesRoad,Mahalaxmi,Mumbai-400011Telephone:+91-22-66568484Fax:+91-22-66568494Email:csg-unit@tsrdarashaw.comWebsite:www.tsrdarashaw.comCompliance OfficerMr.V.P.KulkarniHindustanConstructionCo.Ltd.HinconHouse,LalBahadurShastriMarg,Vikhroli(West),Mumbai-400083,India.Tel:+91-22-25775959Fax:+91-22-25775950Website:www.hccindia.comEmail:secretarial@hccindia.com

Investor Relations OfficerMr.SantoshKadamHindustanConstructionCo.Ltd.HinconHouse,LalBahadurShastriMarg,Vikhroli(West),Mumbai-400083Tel:+91-22-25775959Fax:+91-22-25775950Website:www.hccindia.comEmail:secretarial@hccindia.com

39

CEO/CFOcertification,issuedpursuanttotheprovisionsofClause49oftheListingAgreement

TotheBoardofDirectorsofHindustanConstructionCo.Ltd.

Sub:CEO/CFOCertificate

Wehavereviewedthefinancialstatements,readwiththecashflowstatementofHindustanConstructionCo.Ltd.fortheyearendedMarch31,2010andthattothebestofourknowledgeandbelief,westatethat:

(a) (i) Thesestatementsdonotcontainanymateriallyuntruestatementoromitanymaterialfactorcontainstatementsthatmightbemisleading.

(ii)ThesestatementspresentatrueandfairviewoftheCompany’saffairsandareincompliancewithcurrentAccountingStandards,applicablelawsandregulations.

(b) Thereare,tothebestofourknowledgeandbelief,notransactionsenteredintobytheCompanyduringtheyearwhicharefraudulent,illegalorviolationoftheCompany’scodeofconduct.

(c) Weacceptresponsibilityforestablishingandmaintaininginternalcontrolsforfinancialreporting.WehaveevaluatedtheeffectivenessoftheinternalcontrolsystemsoftheCompanypertainingtofinancialreportingandhavedisclosedtotheAuditorsandtheAuditCommittee,deficienciesinthedesignoroperationofsuchinternalcontrols,ifany,ofwhichweareawareandthestepswehavetakenorproposedtobetakenforrectifyingthesedeficiencies.

(d) WehaveindicatedtotheAuditorsandtheAuditCommittee

(i) Significantchangesininternalcontroloverfinancialreportingduringtheyear;

(ii)Significantchangesinaccountingpoliciesmadeduringtheyearandthesamehavebeendisclosedinthenotestothefinancialstatements;and

(iii) Instancesofsignificantfraudofwhichwehavebecomeawareandtheinvolvementtherein,ifany,ofthemanagementoranemployeehavingasignificantroleintheCompany’sinternalcontrolsystemoverfinancialreporting.

Praveen Sood Ajit GulabchandGroupChiefFinancialOfficer ChairmanandManagingDirector

Mumbai,April30,2010

40

DECLARATION

ToTheMembersof

HindustanConstructionCo.Ltd.

Sub:DeclarationunderClause49oftheListingAgreement

IherebydeclarethatalltheDirectorsandthedesignatedemployeesintheSeniorManagementoftheCompanyhaveaffirmedcompliancewiththeirrespectiveCodesforthefinancialyearendedMarch31,2010.

ForHindustanConstructionCo.Ltd.

Ajit Gulabchand ChairmanandManagingDirector

Mumbai,April30,2010

AUDITOR’SCERTIFICATEOFCORPORATEGOVERNANCE

ToTheMembersofHindustanConstructionCo.Ltd.Mumbai-400083

WehaveexaminedthecomplianceofconditionsofCorporateGovernancebyHindustanConstructionCo.Ltd.forthefinancialyearendedMarch31,2010,asstipulatedinClause49oftheListingAgreementofthesaidCompanywiththestockexchange(s).

ThecomplianceofconditionsofCorporateGovernanceistheresponsibilityofthemanagement.Ourexaminationwaslimitedtoproceduresandimplementationthereof,adoptedbytheCompanyforensuringthecomplianceoftheconditionsoftheCorporateGovernance.ItisneitheranauditnoranexpressionofopiniononthefinancialstatementsoftheCompany.

Inouropinion,andtothebestofourinformationandaccordingtotheexplanationsgiventous,wecertifythattheCompanyhascompliedwiththeconditionsofCorporateGovernanceasstipulatedintheabovementionedListingAgreement.

WefurtherstatethatsuchcomplianceisneitheranassuranceastothefutureviabilityoftheCompanynortheefficiencyoreffectivenesswithwhichthemanagementhasconductedtheaffairsoftheCompany.

For K. S. AIYAR & CO

CharteredAccountants

Raghuvir M. Aiyar

Partner

MembershipNo.:38128

Mumbai:April30,2010

HCC 84TH ANNUAL REPORT 2009-201041

CMYK

Notice

NOTICE is hereby given that the Eighty-Fourth AnnualGeneral Meeting of the Members of HindustanConstruction Company Limited will be held on Friday,June 11, 2010 at 11.00 a.m. at Walchand Hirachand Hall,Indian Merchants’ Chamber, Indian Merchants’ ChamberMarg, Churchgate, Mumbai 400020, to transact thefollowing business: -

ORDINARORDINARORDINARORDINARORDINARY BUSINESSY BUSINESSY BUSINESSY BUSINESSY BUSINESS

1. To receive, consider and adopt the Audited BalanceSheet as at March 31, 2010, the Profit & Loss Accountfor the year ended on that date and the Reports ofthe Directors and Auditors thereon.

2. To declare dividend on Equity Shares.

3. To appoint a Director in place of Mr. D.M.Popat, whoretires by rotation, and being eligible, offers himselffor re-appointment.

4. To appoint a Director in place of Mr. Y.H. Malegam,who retires by rotation, and being eligible, offershimself for re-appointment.

5. To consider and if thought fit, to pass with or withoutmodification(s), the following resolution as anOrdinary ResolutionOrdinary ResolutionOrdinary ResolutionOrdinary ResolutionOrdinary Resolution:

“RESOLVED THAT M/s. K. S. Aiyar & Co., CharteredAccountants, Mumbai, bearing ICAI Registration No.100186W, the retiring Auditors of the Company, beand are hereby re-appointed as the Auditors of theCompany, including all its Branch Offices / Sites, tohold office from the conclusion of this Annual GeneralMeeting until the conclusion of the next AnnualGeneral Meeting on a remuneration as may be fixedby the Board of Directors of the Company.

RESOLVED FURTHER THAT the Board of Directors beand is hereby authorized in consultation with theCompany’s Auditors to appoint Branch Auditor(s) ofthe Company, to audit the accounts of the Company’sProject Sites within and outside India, present andfuture on such terms and conditions includingremuneration as the Board of Directors may deem fit.”

SPECIAL BUSINESSSPECIAL BUSINESSSPECIAL BUSINESSSPECIAL BUSINESSSPECIAL BUSINESS

6. To consider and if thought fit, to pass with or withoutmodification(s), the following resolution as anOrdinary ResolutionOrdinary ResolutionOrdinary ResolutionOrdinary ResolutionOrdinary Resolution:

“RESOLVED THAT Mr. K. G. Tendulkar, who wasappointed by the Board of Directors as an AdditionalDirector of the Company with effect from November08, 2009 and who holds office upto the date of thisAnnual General Meeting in terms of Section 260 ofthe Companies Act, 1956 (“the Act”) and in respectof whom the Company has received a notice inwriting from a Member of the Company under theprovisions of Section 257 of the Act proposing hiscandidature for the office of a Director of theCompany, be and is hereby appointed as a Directorof the Company, liable to retire by rotation.”

7. To consider and if thought fit, to pass with or withoutmodification(s), the following resolution as anOrdinary ResolutionOrdinary ResolutionOrdinary ResolutionOrdinary ResolutionOrdinary Resolution:

“RESOLVED THAT Mr. Anil C. Singhvi, who wasappointed by the Board of Directors as a Director tofill the casual vacancy caused by the resignation ofMr. R. G. Vartak from the Board of Directors of the

Company and holds office upto the date of thisAnnual General Meeting in terms of Section 262 ofthe Companies Act, 1956 (“the Act”), and in respectof whom the Company has received a notice inwriting from a Member of the Company under theprovisions of Section 257 of the Act proposing hiscandidature for the office of a Director of theCompany, be and is hereby appointed as a Directorof the Company, liable to retire by rotation.”

8. To consider and if thought fit, to pass with or withoutmodification(s), the following resolution as anOrdinary ResolutionOrdinary ResolutionOrdinary ResolutionOrdinary ResolutionOrdinary Resolution:

“RESOLVED THAT pursuant to the provisions ofSections 16, 94 and all other applicable provisions, ifany, of the Companies Act, 1956, (including anystatutory modification or re-enactment thereof forthe time being in force), the Authorised Share Capitalof the Company of Rs.50,00,00,000 (Rupees FiftyCrores Only) divided into 49,50,00,000 Equity Sharesof Re.1/- each and 50,000, 9.5%, RedeemableCummulative Preference Shares of Rs.100/- each beand is hereby increased to Rs.100,00,00,000 (RupeesOne Hundred Crores only) divided into 90,00,00,000Equity Shares of Re.1/- each and 1,00,00,000Redeemable Preference Shares of Rs.10/- each withthe power to the Board to decide to classify andreclassify from time to time such Preference Sharesand fix the dividend and/or the premium payable onthe same upon redemption.”

“RESOLVED FURTHER THAT the Memorandum ofAssociation of the Company be and is hereby alteredby substituting the existing Clause V thereof by thefollowing Clause V:

V. The Capital of the Company is Rs.100,00,00,000(Rupees One Hundred Crores only) divided intoRs.90,00,00,000 (Ninety Crore) Equity Shares ofRe.1/- (Rupee One only) each and 1,00,00,000(One Crore) Redeemable Preference Shares ofRs.10/- (Rupees Ten only) each.

RESOLVED FURTHER THAT for the purpose of givingeffect to this resolution, the Board of Directors of theCompany be and is hereby authorised to take all suchsteps and actions and give such directions as may bein its absolute discretion deem necessary and to settleany question that may arise in this regard.”

9. To consider and if thought fit, to pass with or withoutmodification(s), the following resolution as a SpecialSpecialSpecialSpecialSpecialResolutionResolutionResolutionResolutionResolution:

“RESOLVED THAT pursuant to provisions of Section31 and all other applicable provisions, if any, of theCompanies Act, 1956, (including any statutorymodification or re-enactment thereof for the timebeing in force), the existing Articles of Associationof the Company be and is hereby altered bysubstituting the existing Article 6a with the Article 6as under and by deleting the existing Articles 6b and6c:

Art 6 The Capital of the Company is Rs.100,00,00,000(Rupees One Hundred Crore only) divided intoRs.90,00,00,000 (Ninety Crore) Equity Shares ofRe.1/- (Rupee one only) each and 1,00,00,000(One Crore) Redeemable Preference Shares ofRs.10/- (Rupees Ten only) each.

RESOLVED FURTHER THAT for the purpose of giving

HCC 84TH ANNUAL REPORT 2009-201042

CMYK

effect to this resolution, the Board of Directors of theCompany be and is hereby authorised to take all suchsteps and actions and give such directions as may bein its absolute discretion deem necessary and to settleany question that may arise in this regard.”

10. To consider and if thought fit, to pass with or withoutmodification(s), the following resolution as a SpecialSpecialSpecialSpecialSpecialResolutionResolutionResolutionResolutionResolution:“RESOLVED THAT pursuant to provisions of Section31 and all other applicable provisions, if any, of theCompanies Act, 1956, (including any statutorymodification or re-enactment thereof for the time beingin force), the existing Articles of Association of theCompany be and is hereby altered by substituting theexisting Article 201 with the following Article:Art 201 (1) Subject to the provisions of the Act and

regulations made thereunder or anyother applicable law, the Company shallhave the power, by a Resolution of theBoard, to capitalize its profits, gains,investments or other assets forming partof the undivided profits for the timebeing of the Company standing to thecredit of the Reserve Fund or any otherFund or the Profit and Loss Account ofthe Company or in the hands of theCompany and available for dividend orrepresenting premium received on theissue of shares and standing to the creditof the Securities Premium Account orotherwise available for distribution:(a) by the distribution among the

holders of the shares of theCompany or any of them inaccordance with their respectiverights, and interests and inproportion to the amounts paid orcredited as paid thereon, of paid upshares, or

(b) by crediting shares of the Companywhich may have been issued andare not fully paid up, in proportionto the amounts paid or credited aspaid thereon respectively, with thewhole or any part of the sumsremaining unpaid thereon.

(2) The Directors shall have authority, in itsabsolute discretion to apply such portionof the profits, General Reserve, Reserveor Reserve Fund or any other fund asmay be required for the purpose ofmaking payment in full or part for theshares so distributed or (as the case maybe) for the purpose of paying, in wholeor in part, the amount remaining unpaidon the shares, which may have beenissued and are not fully paid-up. Suchdistribution and payment shall standaccepted by such shareholders in fullsatisfaction of their interest in the saidcapitalised sum.

(3) The Directors shall have powers to settleany difficulty which may arise in regardto the distribution or payment asaforesaid as they think expedient and inparticular they may issue shares in lieuof the fraction and generally make sucharrangements for the acceptance,

allotment and sale of such sharesfractions or otherwise as they think fitand may make cash payments to anyholders of shares or fractions on thefooting of the value so fixed in order toadjust such rights and may vest any suchshares, in trustees upon such trusts foradjusting such rights as may seemexpedient to the Directors.

(4) Where some of the shares of theCompany are fully paid and others arepartly paid only, the Board shall havepowers to effect the capitalisation by thedistribution of further shares in respectof the fully paid shares and by creditingthe partly paid shares with the whole orpart of the unpaid liability thereon butso that as between the holders of thefully paid shares and the partly paidshares the sums so applied in thepayment of such further shares and inthe extinguishment or diminution of theliability on the partly paid shares shallbe prorata in proportion to the amountsthen already paid or credited as paid onthe existing fully paid and partly paidshares respectively.

RESOLVED FURTHER THAT for the purpose of givingeffect to this resolution, the Board of Directors of theCompany be and is hereby authorised to take allsuch steps and actions and give such directions asmay be in its absolute discretion deem necessaryand to settle any question that may arise in thisregard.”

By Order of the BoardFor Hindustan Construction Company Ltd

VITHAL P. KULKARNICompany Secretary

Registered Office:Registered Office:Registered Office:Registered Office:Registered Office:Hincon House,Lal Bahadur Shastri Marg,Vikhroli (West),Mumbai 400 083

Place: MumbaiDate: April 30, 2010

NOTESNOTESNOTESNOTESNOTES1. A MEMBER ENTITLED TO AA MEMBER ENTITLED TO AA MEMBER ENTITLED TO AA MEMBER ENTITLED TO AA MEMBER ENTITLED TO ATTEND AND VOTE ATTEND AND VOTE ATTEND AND VOTE ATTEND AND VOTE ATTEND AND VOTE ATTTTT

THE MEETING IS ENTITLED TO APPOINT ONE ORTHE MEETING IS ENTITLED TO APPOINT ONE ORTHE MEETING IS ENTITLED TO APPOINT ONE ORTHE MEETING IS ENTITLED TO APPOINT ONE ORTHE MEETING IS ENTITLED TO APPOINT ONE ORMORE PROXIES TO AMORE PROXIES TO AMORE PROXIES TO AMORE PROXIES TO AMORE PROXIES TO ATTEND AND VOTE INSTEADTTEND AND VOTE INSTEADTTEND AND VOTE INSTEADTTEND AND VOTE INSTEADTTEND AND VOTE INSTEADOF HIMSELF AND THE PROXY NEED NOT BE AOF HIMSELF AND THE PROXY NEED NOT BE AOF HIMSELF AND THE PROXY NEED NOT BE AOF HIMSELF AND THE PROXY NEED NOT BE AOF HIMSELF AND THE PROXY NEED NOT BE AMEMBER OF THE COMPMEMBER OF THE COMPMEMBER OF THE COMPMEMBER OF THE COMPMEMBER OF THE COMPANYANYANYANYANY. PROXIES IN ORDER. PROXIES IN ORDER. PROXIES IN ORDER. PROXIES IN ORDER. PROXIES IN ORDERTO BE EFFECTIVE MUST BE DEPOSITED ATO BE EFFECTIVE MUST BE DEPOSITED ATO BE EFFECTIVE MUST BE DEPOSITED ATO BE EFFECTIVE MUST BE DEPOSITED ATO BE EFFECTIVE MUST BE DEPOSITED AT THET THET THET THET THEREGISTERED OFFICE OF THE COMPREGISTERED OFFICE OF THE COMPREGISTERED OFFICE OF THE COMPREGISTERED OFFICE OF THE COMPREGISTERED OFFICE OF THE COMPANY NOT LESSANY NOT LESSANY NOT LESSANY NOT LESSANY NOT LESSTHAN 48 HOURS BEFORE THE COMMENCEMENTTHAN 48 HOURS BEFORE THE COMMENCEMENTTHAN 48 HOURS BEFORE THE COMMENCEMENTTHAN 48 HOURS BEFORE THE COMMENCEMENTTHAN 48 HOURS BEFORE THE COMMENCEMENTOF THE MEETING.OF THE MEETING.OF THE MEETING.OF THE MEETING.OF THE MEETING.

2. The Register of Members and the Share TransferBooks of the Company will remain closed fromTuesday, June 1, 2010 to Friday, June 11, 2010 (bothdays inclusive) for the purpose of payment ofdividend.

3. The Explanatory Statement pursuant to Section 173(2)of the Companies Act, 1956, relating to the SpecialBusiness to be transacted at the ensuing Annual

HCC 84TH ANNUAL REPORT 2009-201043

CMYK

General Meeting is annexed hereto and forms partof the Notice.

4. The Members are requested to intimate change intheir registered address, if any, to the Company’sRegistrar and Share Transfer Agents, M/s. TSRDarashaw Limited at 6-10, Haji Moosa Patrawala Indl.Estate, 20, Dr. E. Moses Road, Mahalaxmi, Mumbai -400 011 in respect of their holdings in physical form.Members are requested to notify immediately anychange in their address to their Depository Participantsin respect of their holdings in electronic form.Non-Resident Indian Members are requested toinform M/s. TSR Darashaw Limited immediately ofthe change in residential status on return to India forpermanent settlement.

5. The dividend as recommended by the Board, ifapproved at the ensuing Annual General Meeting,will be paid to those Members whose names appearon the Company’s Register of Members as on June11, 2010.The dividend in respect of Shares held in theelectronic form will be paid to the beneficial ownersof Shares whose names appear in the list furnishedby the Depositories for this purpose at the close ofbusiness hours on May 31, 2010.

6. Corporate Members intending to send theirauthorized representatives are requested to send dulycertified copy of the Board Resolution authorizingtheir representatives to attend and vote at the ensuingAnnual General Meeting so as to reach the Companyon or before June 09, 2010.

7. Consequent upon, the introduction of Section 109Aof the Companies Act, 1956, Members are entitled tomake nominations in respect of the Equity Sharesheld by them in physical form. Members desirous ofmaking nominations may send their requests in Form2B to the Registrar & Share Transfer Agents, M/s. TSRDarashaw Limited (Form 2B is available with them).

8. The Securities & Exchange Board of India (SEBI) hasmade it mandatory for all Companies to use the bankaccount details furnished by the Depositories forcrediting dividend. The Company has madearrangements for crediting the dividend throughNational Electronic Clearing Services (NECS)/Electronic Clearing Services (ECS) to investors whereNECS/ECS details are available. Members may,therefore, give details regarding bank accounts inwhich they wish to receive dividend, through theirDepository Participants. The Company will notentertain any direct request from such members fordeletion of / or change in such bank details. Further,instructions if any, already given by them in respectof Equity Shares held in physical form, will not beautomatically applicable to dividend payable onEquity Shares in electronic form.

9. In order to provide protection against fraudulentencashment of the warrants, Members holding EquityShares in physical form are requested to intimatethe Registrar & Share Transfer Agents, M/s. TSRDarashaw Ltd., by a duly signed letter by all theholders, the following information required to beprinted on the Dividend Warrants:i) Name of Sole/Joint holders and their respective

Folio Numbers

ii) Particulars of Bank Account, viz.(a) Name of the Bank(b) Name of the Branch(c) Complete address of the Bank with Pin Code

Number.(d) Account type, whether Savings (SB) or

Current Account (CA)(e) Account number allotted by the Bank

10. Appointment / Re-appointment of DirectorsAppointment / Re-appointment of DirectorsAppointment / Re-appointment of DirectorsAppointment / Re-appointment of DirectorsAppointment / Re-appointment of DirectorsPursuant to Clause 49 (IV) (G) of the ListingAgreement relating to Corporate Governance, thebrief profile of the Directors is given below:

I. Name:Name:Name:Name:Name: : Mr. D.M. PopatDate of BirthDate of BirthDate of BirthDate of BirthDate of Birth : December 18, 1933Qualification &Qualification &Qualification &Qualification &Qualification & : B.Com. B.A., LL.BExpertiseExpertiseExpertiseExpertiseExpertise Mr. Popat is a senior partner of

Mulla & Mulla and Craigie Blunt& Caroe. He has been in practicefor over 46 year and has vastexperience in legal field.

Other detailsOther detailsOther detailsOther detailsOther details : Mr. Popat is a Director of theCompany since January 19, 2001.He is on the Board of thefollowing public companies:(i) Hindoostan Spg. & Wvg.

Mills Ltd.(ii) Peninsula Land Limited

(formerly Morarjee RealitiesLtd)., and

(iii) The Ruby Mills Ltd.He is Chairman of RemunerationCommittee of:(i) Hindoostan Spg. & Wvg.

Mills Ltd., and(ii) Peninsula Land Ltd.He is also a Member ofRemuneration Committee of TheRuby Mills Ltd.Mr. Popat is member of theManaging Committee of theBombay Incorporated LawSociety and Member ofGoverning Body of the IndianCouncil of Arbitration &Chairman of Law Sub-Committee of IMC and W.R.Indian Council of Arbitration.

No. of EquityNo. of EquityNo. of EquityNo. of EquityNo. of Equity ::::: NILShares heldShares heldShares heldShares heldShares held

II. Name:Name:Name:Name:Name: : Mr. Y.H.MalegamDate of BirthDate of BirthDate of BirthDate of BirthDate of Birth : September 24, 1933Qualification &Qualification &Qualification &Qualification &Qualification & : B. Com., F.C.A. (England & Wales)ExpertiseExpertiseExpertiseExpertiseExpertise He is an eminent Chartered

Accountant & was a seniorpartner of Messers S.B.Billimoria & Company, leadingfirm of Chartered Accountantsin India

HCC 84TH ANNUAL REPORT 2009-201044

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He has a wide and richexperience in the field of finance& accounts.

Other detailsOther detailsOther detailsOther detailsOther details : Mr. Malegam is a Director of theCompany since July 23, 1974He is also a Director of thefollowing public companies viz:(i) ABC Bearings Limited, (ii) TheClearing Corporation of IndiaLtd., (iii) First Source SolutionsLtd., (iv) National StockExchange of India Ltd.,(v) National Securities ClearingCorp. Ltd., (vi) PiramalHealthcare Ltd., and(vii) Siemens Ltd.He is the Chairman of the AuditCommittee of:(i) Bharatiya Reserve Bank-

Note Mudran (P) Ltd.,(ii) Clearing Corporation of

India Ltd.,(iii) First Source Solutions Ltd.,(iv) National Securities Clearing

Corp. Ltd., and(v) Siemens Ltd.He is a Member of AuditCommittee of:(i) National Stock Exchange of

India Ltd., and(ii) Piramal Healthcare Ltd.He also a Member (i) CentralBoard of Western Indian LocalBoard of Reserve Bank of India.,(ii) Indian Institute of Banking &Finance., and (iii) Indo GermanChamber of Commerce.

No. of EquityNo. of EquityNo. of EquityNo. of EquityNo. of Equity : 5,000Shares heldShares heldShares heldShares heldShares held

III. Name:Name:Name:Name:Name: : Mr. K. G. TendulkarDate of BirthDate of BirthDate of BirthDate of BirthDate of Birth : February 4, 1954Qualification &Qualification &Qualification &Qualification &Qualification & : B.Com. B.G.L, FCAExpertiseExpertiseExpertiseExpertiseExpertise He has varied and rich

experience in seniormanagement and operatingpositions in the Company.

Other detailsOther detailsOther detailsOther detailsOther details : Mr. K. G. Tendulkar wasExecutive Director, incharge ofOperations since 1993 and waselevated as Dy. ManagingDirector of the Company duringthe year 2005. Mr. K. G.Tendulkar’s tenure as DeputyManaging Director expired onNovember 7, 2009. The Boardof Direcotrs at its Meeting heldon October 23, 2009 hasappointed him as an AdditionalDirector from November 8, 2009.He is also on the Board of thefollowing public companies: (i)

Hincon Finance Ltd, (ii) HinconHoldings Ltd, (iii) Pune-Paud TollRoad Company Ltd, (iv) HCCReal Estate Ltd, (v) LavasaCorporation Ltd., (vi) HCCInfrastructure Ltd., (vii) HCCConstruction Ltd. (viii) HighbarTechnologies Ltd. and (ix)Charosa Wineries Ltd.He is Chairman of AuditCommittee of Pune-Paud TollRoad Company Ltd.He is a Member of AuditCommittee of (i) HCC Real EstateLtd., and (ii) Charosa Wineries Ltd.He is also a Member of theCompany’s Shareholders’/Investors’ Grievance Committeeand ESOP CompensationCommittee.

No. of EquityNo. of EquityNo. of EquityNo. of EquityNo. of Equity : 10,000Shares heldShares heldShares heldShares heldShares held

IV. Name:Name:Name:Name:Name: : Mr. Anil C. SinghviDate of BirthDate of BirthDate of BirthDate of BirthDate of Birth : June 30, 1959Qualification &Qualification &Qualification &Qualification &Qualification & : B. Com, Chartered AccountantExpertiseExpertiseExpertiseExpertiseExpertise He is Vice Chairman of Reliance

Natural Resouces Limited andwas Managing Director ofAmbuja Cements Ltd.He has a wide and richexperience in the field of finance& accounts.

Other detailsOther detailsOther detailsOther detailsOther details : He is also on the Board of thefollowing public companies:(i) Camlin Ltd., and (ii) MastekLtd.He is a Member of AuditCommittee of: (i) Camlin Ltd.,and (ii) Reliance NaturalResources Ltd.He is a Member ofCompensation Committee ofCamlin Ltd.He is also a Member of AuditCommittee and SelectionCommittee of the Company.

No. of EquityNo. of EquityNo. of EquityNo. of EquityNo. of Equity : 16,860Shares heldShares heldShares heldShares heldShares held

By Order of the BoardFor Hindustan Construction Company Ltd

VITHAL P. KULKARNICompany Secretary

Registered Office:Registered Office:Registered Office:Registered Office:Registered Office:Hincon House,Lal Bahadur Shastri Marg,Vikhroli (West),Mumbai 400 083.

Place: MumbaiDate: April 30, 2010

HCC 84TH ANNUAL REPORT 2009-201045

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EXPLANAEXPLANAEXPLANAEXPLANAEXPLANATORTORTORTORTORY STY STY STY STY STAAAAATEMENT PURSUANT TO SECTIONTEMENT PURSUANT TO SECTIONTEMENT PURSUANT TO SECTIONTEMENT PURSUANT TO SECTIONTEMENT PURSUANT TO SECTION173 OF THE COMP173 OF THE COMP173 OF THE COMP173 OF THE COMP173 OF THE COMPANIES ACTANIES ACTANIES ACTANIES ACTANIES ACT, 1956, 1956, 1956, 1956, 1956Item No. 6Item No. 6Item No. 6Item No. 6Item No. 6Mr. K.G. Tendulkar’s tenure as Deputy Managing Directorof the Company expired on November 7, 2009. He wasappointed as an Additional Director of the Company w.e.f.November 08, 2009 by the Board of Directors at itsmeeting held on October 23, 2009 under the provision ofSection 260 of the Companies Act, 1956 read with Article135 of Articles of Association of the Company. Mr. K. G.Tendulkar would hold the office upto the date of theforthcoming Annual General Meeting.The Company has received notice in writing under Section257 of the Companies Act, 1956 from a Member of theCompany along with the deposit of Rs. 500/- signifying hisintention to propose Mr. K.G.Tendulkar to hold the office ofDirector of the Company.Given the experience / illustratious background of Mr. K. G.Tendulkar, the Board felt that it is in the interest of theCompany, to appoint him as a Director of the Company.The Board of Directors therefore recommends theresolution for the approval of the Members.Except Mr. K.G. Tendulkar, none of the Directors isconcerned or interested in the resolution.

Item No. 7Item No. 7Item No. 7Item No. 7Item No. 7Mr. Anil C. Singhvi was appointed as a Director w.e.f.July 27, 2007 by the Board of Directors of the Companyat its Meeting held on July 27, 2007 under Article 134 ofthe Articles of Association of the Company to fill thecasual vacancy caused by the resignation of Mr. R. G.Vartak from the Board of Directors of the Company, whowould have retired by rotation at the ensuing AnnualGeneral Meeting had he not resigned.In terms of Section 262 of the Companies Act, 1956Mr. Anil C. Singhvi can hold office of Director upto theconclusion of the forthcoming Annual General Meeting.The Company has received notice in writing underSection 257 of the Companies Act, 1956 from a Memberof the Company along with the deposit of Rs. 500/-signifying his intention to propose Mr. Anil C. Singhvi tohold the office of Director of the Company.The Board of Directors of the Company is of the viewthat the Company shall benefit considerably through theknowledge and experience of Mr. Anil C. Singhvi. TheBoard of Directors, therefore, recommends the resolutionfor the approval of the Members.Except Mr. Anil C. Singhvi, none of the Directors isconcerned or interested in the resolution.Item No. 8 & 9Item No. 8 & 9Item No. 8 & 9Item No. 8 & 9Item No. 8 & 9The Company has registered considerable growth in itsbusiness over the recent years. With the continued growthand development in the infrastructure sector in thecountry and the Company’s endeavour to secure businessin future, it would be imperative to infuse additionalcapital as and when the need is felt.In order to accommodate any such enhancement in thecapital in future by way of issue of new shares, it isnecessary to increase the Authorised Share Capital ofthe Company to Rs.100,00,00,000 (Rupees One HundredCrore only) from the existing Rs.50,00,00,000 (RupeesFifty Crore only) more particularly stated in the SpecialBusiness at items 8 & 9 of the Notice. The alterationsproposed in the Memorandum and Articles of Associationof the Company are only consequential to reflect the

proposed increase in the Authorised Share Capital of theCompany.Further, Articles 6b and 6c of the Articles of Associationof the Company are proposed to be deleted as they wouldbe redundant in view of the proposed amendment inArticle 6.Your Directors therefore recommend the resolutions atbusiness items no. 8 & 9 of the Notice for your approval.None of the Directors of the company is concerned orinterested in the said resolution.Item No.10Item No.10Item No.10Item No.10Item No.10The Article 201 of the Articles of Association authorisesthe Company to capitalize, inter alia by way of issue ofBonus Shares, the investments or other assets formingpart of the undivided profits for the time being of theCompany standing to the credit of the Reserve Fund orany other Fund or the Profit and Loss Account of theCompany or in the hands of the Company and availablefor dividend or representing premium received on theissue of shares and standing to the credit of the SecuritiesPremium Account or otherwise available for distribution.The Article prescribes that the capitalization is to beapproved by the Members upon a recommendation bythe Board. It is felt that seeking the approval of theMembers of the Company would prolong the timebetween the recommendation by the Board and the actualallotment of Bonus Shares.The Companies Act, 1956 and the SEBI Regulations forissue of Bonus Shares do not prescribe the approval bythe Members of the Company for issuance of the same.In order to enable the Board to expeditiously completethe process of issue of Bonus Shares whenever the Boarddecides for the same in its discretion, it is thereforeproposed that the Board be authorized to capitalize thereserves of the Company in a manner as they may deemexpedient without seeking approval from the Membersof the Company.This amendment in the Articles of Association will enablethe Company to give effect to the Board’s proposals inan expeditious manner. The Board therefore recommendsto the Members for approval of the resolution.None of the Directors is concerned or interested in theresolution.The draft of the amendments to the Memorandum andArticles of Association of the Company will remain openfor the inspection of the Members at the Registered Officeof the Company between 11.00 a.m. to 1.00 p.m. on anyworking day of the Company till the date of ensuingAnnual General Meeting.

By Order of the BoardFor Hindustan Construction Company Ltd

VITHAL P. KULKARNICompany Secretary

Registered Office:Registered Office:Registered Office:Registered Office:Registered Office:Hincon House,Lal Bahadur Shastri Marg,Vikhroli (West),Mumbai 400 083

Place: MumbaiDate: April 30, 2010

Annexure to the Notice

HCC 84TH ANNUAL REPORT 2009-201046

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Directors’ Report

TTTTTo,o,o,o,o,

The Members ofThe Members ofThe Members ofThe Members ofThe Members ofHindustan Construction Co. Ltd.Hindustan Construction Co. Ltd.Hindustan Construction Co. Ltd.Hindustan Construction Co. Ltd.Hindustan Construction Co. Ltd.

1.1.1.1.1. ReportReportReportReportReport

Your Directors are pleased to present the 84th Annual Report together with the Audited Accounts for the yearended March 31, 2010

2.2.2.2.2. Financial HighlightsFinancial HighlightsFinancial HighlightsFinancial HighlightsFinancial Highlights

ParticularsParticularsParticularsParticularsParticulars YYYYYear endedear endedear endedear endedear ended Year endedMarch 31, 2010March 31, 2010March 31, 2010March 31, 2010March 31, 2010 March 31, 2009

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

TTTTTurnoverurnoverurnoverurnoverurnover 3862.973862.973862.973862.973862.97 3518.32

Profit before Interest, Depreciation and TProfit before Interest, Depreciation and TProfit before Interest, Depreciation and TProfit before Interest, Depreciation and TProfit before Interest, Depreciation and Taxaxaxaxax 440.89440.89440.89440.89440.89 490.27

Less: i) Interest 205.15205.15205.15205.15205.15 210.50

ii) Depreciation 113.90113.90113.90113.90113.90 319.05319.05319.05319.05319.05 115.22 325.72

Profit before TProfit before TProfit before TProfit before TProfit before Taxaxaxaxax 121.84121.84121.84121.84121.84 164.55

Less: Provision for Current Tax 20.9620.9620.9620.9620.96 18.61

Provision for Deferred Tax 40.1540.1540.1540.1540.15 36.51

Provision for Fringe Benefit Tax ————— 2.40

MAT- Credit Entitlement (20.71)(20.71)(20.71)(20.71)(20.71) 40.4040.4040.4040.4040.40 (18.32) 39.20

Profit after TProfit after TProfit after TProfit after TProfit after Taxaxaxaxax 81.4481.4481.4481.4481.44 125.35

Add: Balance brought forward from last year 279.90279.90279.90279.90279.90 207.95

Add: Transferred from Debenture Redemption Reserve 5.415.415.415.415.41 8.50

Amount available for AppropriationAmount available for AppropriationAmount available for AppropriationAmount available for AppropriationAmount available for Appropriation 366.75366.75366.75366.75366.75 341.80

Less: AppropriationsLess: AppropriationsLess: AppropriationsLess: AppropriationsLess: Appropriations

a) Proposed Dividend 24.2624.2624.2624.2624.26 20.50

b) Tax on Proposed Dividend 4.124.124.124.124.12 3.48

c) Debenture Redemption Reserve 8.758.758.758.758.75 12.92

d) Transferred to General Reserve 10.0010.0010.0010.0010.00 25.00

47.1347.1347.1347.1347.13 61.90

Balance Carried to Balance SheetBalance Carried to Balance SheetBalance Carried to Balance SheetBalance Carried to Balance SheetBalance Carried to Balance Sheet 319.62319.62319.62319.62319.62 279.90

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3.3.3.3.3. DividendDividendDividendDividendDividend

Your Directors are pleased to recommend a dividendof Re.0.80 per Equity Share of Re.1/- each for thefinancial year ended March 31, 2010 (Previous year –Re.0.80 per Equity Share of Re.1/-each) aggregatingto Rs. 24.26 crore.

4.4.4.4.4. OperationsOperationsOperationsOperationsOperations

The turnover of the Company at Rs. 3862.97 crorehas shown an increase of 9.8% as compared toRs. 3518.32 crore for the previous year. The profitbefore tax is Rs. 121.84 crore as compared to Rs.164.55 crore for the previous year.

Your Directors are pleased to inform that during theyear under report, the Company has secured thefollowing major contracts.

• Dagachhu Hydro Power Plant (Civil Works), 114MW, BhutanContract Value: 388 crore

• Gosikhurd Hydel Scheme, 24 MW, MaharashtraContract Value: 229 crore

• Pare Hydro Electric Project,110 MW, ArunachalPradeshContract Value: 276 crore

• Pumped Water Supply scheme from Kesaria toSonaria, Gujarat (NC-25)Contract Value: 168 crore

• Elevated Road Corridor from Park Circus toE.M. Bypass, KolkataContract Value: 318 crore

• Cavern for Crude oil storage, Padur, KarnatakaContract Value: 375 crore

• POT Shell fabrication works for AdityaAluminium project, OrissaContract Value: 109 crore

• Four-laning of Bahrampore-Farraka section ofNH-34 in West Bengal on Design, Build, Finance,Operate and Transfer Toll basis under NHDP-III(Package No.NHDP-III/BOT/WB/03)

• Four-laning of Farraka-Raiganj section of NH-34in West Bengal on Design, Build, Finance,Operate and Transfer Toll basis under NHDP-III(Package No.NHDP-III/BOT/WB/04)

• Four-laning of Raiganj-Dalkhola section of NH-34 in West Bengal on Design, Build, Finance,Operate and Transfer Toll basis under NHDP-III(Package No.NHDP-III/BOT/WB/05)

• POT Superstructure fabrication works forAditya Aluminium project, OrissaContract Value: 100 crore

• Civil and Piling works for Aditya AluminiumProject, OrissaContract Value: 199 crore

• Single Line Tunnel No.1 between Dholakal andKalmai, AssamContract Value: 118 crore

• Reconstruction of Dry Dock at Naval Dockyard,MumbaiContract Value: 608 crore

The total balance value of works on hand as on March31, 2010 is Rs.18,810 crore including Company’s sharein integrated joint venture projects and Sawalkotproject.

Decisions are awaited from various clients for tenderssubmitted by the Company (Directly or in JV) for 24projects amounting to about Rs.9,520 crore. Tendersfor various packages for 23 projects worth aboutRs.14,630 crore are expected to be submitted in thenear future. The Company has also submittedprequalification bids for 11 projects worth overRs.6,170 crore, which are currently under evaluation.The Company is confident of securing a sizeableshare of these new projects.

Subsidiaries OperationsSubsidiaries OperationsSubsidiaries OperationsSubsidiaries OperationsSubsidiaries Operations

(i)(i)(i)(i)(i) Lavasa Corporation Ltd. - Integrated UrbanLavasa Corporation Ltd. - Integrated UrbanLavasa Corporation Ltd. - Integrated UrbanLavasa Corporation Ltd. - Integrated UrbanLavasa Corporation Ltd. - Integrated UrbanDevelopment & ManagementDevelopment & ManagementDevelopment & ManagementDevelopment & ManagementDevelopment & Management

Lavasa is free India’s first planned hill city beingdeveloped by Lavasa Corporation Ltd., subsidiarycompany of HCC. Located in the Western regionof India in the picturesque landscape of theSahayadri Mountains, it is set amidst 7 hills and60 km. of lakefront. A three hour drive fromMumbai and an hour’s drive from Pune, the cityis one fourth of the size of Mumbai.

The master plan of Lavasa (current developmentplan-18,000 acres) is developed by internationallyrenowned design consultant HOK, USA. Themaster plan, recipient of many internationalawards, is based on the principles of NewUrbanism that brings together all thecomponents essential to daily life in a moreorganized manner. Lavasa has many firsts to itscredit - technology leadership, e-Governance,India’s first e-city, the first Indian city developedusing Geographical Information System (GIS),etc. In association with The Biomimicry Guild(USA), the science of Biomimicry is used atLavasa where learnings from nature areseamlessly integrated in the master planning ofLavasa.

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Lavasa is planned for a permanent population ofaround 3 lakh residents and a tourist inflow thatis envisaged at 20 lakh per annum. It aims toprovide a perfect work - life balance with anunique combination of technology andinfrastructure advancements. The city will havea 365 day economy with a host of non pollutingindustries being the main economic driver; theseinclude R&D and training centres, IT and biotechindustry, KPOs and those related to art, fashionand animation.

The tie ups continued though 2009 - 10. In thehospitality space partners such as AccorHospitality with three brands - Mercure, Novoteland Pullman are all getting ready to launch inthe next 12 months with Mercure opening firstin April 2010. Accor Hospitality is also managingthe Lavasa International Convention Centre whichopened its doors in March 2010. Hilton, Ramada,Velvett Country, Oakwood, two Langhamproperties, Holiday Inn and many more are tofollow in quick succession giving Lavasa a newhotel property every 6 months.

An equal amount of progress has been made inthe education space with the Ecole HoteliereLavasa opening in July 2009 followed byEducomp with an IB school and Euro kids with aprimary and pre-primary school.

The Institute of International Business RelationsGermany is ready to launch their programs inthe next 12 months. NSHM Knowledge Campusof Kolkata, Symbiosis of Pune and ChristUniversity of Bangalore are also to follow withtheir campuses over the next 18 months.

Professional and Executive Education has alsotaken off in Lavasa in a big way with MIT havingconducted their pilot program based on Airportand Airline Systems, Planning and Management.This has prepared a platform for them to conductsimilar programmes at Lavasa in the future. Inaddition, The Biomimicry Guild, USA also heldits first executive education at Lavasa.

The focus on branding and communicationactivities at the consumer continued withmomentum through 2009-10. Thecommunication activities were targeted at thevarious stakeholders and clearly positionedLavasa as a future city in the making. A thoughtleadership platform –Lavasa Future Cities waslaunched in association with the Times of Indiagroup. The key objective was to trigger athought process amongst public as well as keydecision makers on not only the need to pushfor creation of more urban centres for therapidly migrating Indian populace but also to

push forth the need for better and moreworkable governance structures. This intensive5 month campaign was planned and executedacross various media (print, radio, internet, on-ground events) and included a Citizen Connectinitiative.

During the year, Lavasa Corporation Ltd. hasregistered impressive performance with turnoverof Rs. 481.60 crore as compared to Rs. 212 crorein the previous year. The profit before tax is atRs. 209.50 crore as compared to Rs. 135.10 crorein the previous year.

(ii)(ii)(ii)(ii)(ii) HCC Real Estate Ltd.HCC Real Estate Ltd.HCC Real Estate Ltd.HCC Real Estate Ltd.HCC Real Estate Ltd.

HCC is developing its real estate business throughits wholly owned subsidiary HCC Real Estate Ltd.(HREL). The focus of HREL has been on acquiringand developing real-estate assets that provideunique value propositions to customers.Consequently, instead of building large landbanks, HREL has been focusing on developingprojects that are “one of a kind” in India.

During the financial year 2009-10, 247 Park atVikhroli (West) was completed. Inspite ofrecessionary period, 247 Park has got goodresponse from the various clients and is nowleased to the extent of more than 75% of theoverall leasable area. Considering the interestexpressed by potential clients, we are confidentof leasing out the balance area during the 1stquarter.

247 Park was awarded the prestigious “LEED”certification for Green Building. It was alsoawarded by CNBC Awaaz-CRISIL as “The BestCommercial Building in Western Region of India”.

For the Township projects in the areas of Thane,Pune & Nashik, the Company is consolidating itsposition in respect of land titles and otherdocumentation. The progress on this front issatisfactory.

Charosa Wineries Ltd., a 100% subsidiary of HREL,established in 2008-09 for setting up world-classvineyard and ultra-modern winery in Nashikdistrict has already acquired more than 200 acresof land. All the infrastructural work for vineyardis already completed. The first crop of wine grapeshas already been cultivated for captive use.Company plans to complete the construction andcommission the winery during the year 2010-11.Company has also plans to promote wine tourismconsidering the increasing wine consumption inthe region.

During the year, HREL formed a 100% subsidiaryunder the name HCC Realty Limited to undertakecertain projects.

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Dholera ProjectDholera ProjectDholera ProjectDholera ProjectDholera Project

The Company has received an extension of twoyears to the MOU with Gujarat Government todevelop a Water Front City at Dholera on 4,000acres as the master plan for the same is beingfinalized by the Consultants appointed by theGovernment. The Water Front City will bedeveloped with proposed total investment ofRs. 40,000 crore in Dholera Special InvestmentRegion (SIR) located at the Gulf of Cambay about130 km from Ahmadabad. Dholera is in theinfluence area of the Delhi-Mumbai IndustrialCorridor (DMIC) project which has witnessedsubstantial progress in the last one year. Companyhas continued with the next steps of preparationof concept development report and is expectedto receive the site options from GujaratInfrastructure Development Board (GIDB), thenodal agency for Dholera SIR by June 2010.

(iii)(iii)(iii)(iii)(iii) HCC Infrastructure Ltd.HCC Infrastructure Ltd.HCC Infrastructure Ltd.HCC Infrastructure Ltd.HCC Infrastructure Ltd.HCC Infrastructure Ltd., the company formed asa separate wholly owned subsidiary in thefinancial year 2007-08 to develop infrastructureprojects has during the year under reviewgathered rapid momentum and grown itsportfolio from Rs. 2307 crore in last fiscal toRs. 5539 crore in 2009-10.During the year HCC Infrastructure concentratedmainly on National Highways Authority of India(NHAI) projects on a public private partnershipbasis with the support of an excellent team thathas special DNA that leverages its in – houseconstruction expertise and quality, whileopportunistically defining its own legacy as anasset manager.During the year under review, HCC Infrastructurequalified for 27 road projects, and focused itsbids only for three projects with 100% success.That expressed discipline, creativity and highlypatient investment strategy. In February 2010,the NHAI awarded three contiguous sections ofapproximately 256 km. for the development ofexisting two lanes to four lanes betweenBaharampore to Dalkhola on NH–34 in the stateof West Bengal.These concessions wereawarded on a Design, Build, Finance, Operate,and Transfer (DBFOT) Toll basis with acumulative grant of Rs. 1033 crore. The firstsection is from Baharampore to Farakka(103 km), the second is from Farakka to Raiganj(103 km) and the third is between Raiganj andDalkhola (50 km). These projects are proposedto be implemented by three separate specialpurpose vehicles (SPVs) viz. Baharampore-Farakka Highways Ltd. (BFHL), Farakka-RaiganjHighways Ltd. (FRHL) and Raiganj-DalkholaHighways Limited (RDHL) respectively.

The 4 lane Dhule-Palasner Road project on NH-3from 168.500 km. to 265.000 km. in the State of

Maharashtra under DBFOT basis won last yearin a consortium with two other partners namelyJohn Laing, (U.K.) and Sadbhav Engineering,(India) has achieved Financial Closure within theminimum possible time frame and also hasreached to 10% physical completion. This projectis being implemented by a special purposevehicle (SPV), Dhule- Palesner Tollway Ltd.(DPTL).The prestigious ongoing 6 lane Badarpur-Faridabad Elevated Highway project from 16.100km. to 20.500 km. on Delhi-Agra Section of NH-2has also reached to 67% completion within 15months and expected to be commerciallyoperational in next year. This project is beingimplemented by a special purpose vehicle (SPV),Badarpur-Faridabad Tollway Ltd. (BFTL)Also during the year under review, Nirmal BOTRoad project of 278.000 km. (Kadthal) to 308.000km. (Armur) of NH-7 in the State of AndhraPradesh under North-South Corridor (NHDPPhase-II) on BOT (Annuity) Basis is now fullyoperational with in-house O&M team and hasachieved Commercial Operation Date 100 daysahead of schedule which entitles an early projectcompletion bonus of Rs.13.22 crore. This projectis being implemented by a special purposevehicle (SPV), Nirmal BOT Ltd. (NBL).

5.5.5.5.5. Subsidiary CompaniesSubsidiary CompaniesSubsidiary CompaniesSubsidiary CompaniesSubsidiary CompaniesAt the beginning of the year, the Company had 36subsidiary companies. During the year the followingchanges have taken place.a) Your Company has promoted following wholly

owned subsidiary/subsidiary companies forpromoting Company’s other businesses atopportune times and for specific infrastructuredevelopment projects.

Name of the CompanyName of the CompanyName of the CompanyName of the CompanyName of the Company Date ofDate ofDate ofDate ofDate ofIncorporationIncorporationIncorporationIncorporationIncorporation

Highbar Technologies Limited 25.11.2009

Baharampore-Farakka HighwaysLimited 11.03.2010

Farakka-Raiganj Highways Limited 11.03.2010

Raiganj-Dalkhola HighwaysLimited 11.03.2010

b) HCC Real Estate Limited (the wholly ownedsubsidiary) has promoted the following whollyowned subsidiary company, making it asubsidiary of your Company from the date of itsincorporation.

Name of the CompanyName of the CompanyName of the CompanyName of the CompanyName of the Company Date ofDate ofDate ofDate ofDate ofIncorporationIncorporationIncorporationIncorporationIncorporation

HCC Realty Limited 18.02.2010

c) Lavasa Corporation Limited has promoted thefollowing companies making them subsidiaries

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of your Company from the day of theirincorporation.

Name of the CompanyName of the CompanyName of the CompanyName of the CompanyName of the Company Date ofDate ofDate ofDate ofDate ofIncorporationIncorporationIncorporationIncorporationIncorporation

Green Hills Residences Limited 06.05.2009

My City Technology Limited 04.08.2009

Reasonable Housing Limited 23.09.2009

Minfur Interior TechnologiesLimited 30.11.2009

Verzon Hospitality Limited 08.01.2010

Rhapsody Hospitality Limited 14.01.2010

Valley View Entertainment Limited 20.01.2010

Andromeda Hotels Limited 22.01.2010

Sirrah Palace Hotels Limited 25.01.2010

Whistling Thrush FacilitiesServices Limited 27.01.2010

Warasgaon Tourism Limited 25.02.2010

Our Home Service ApartmentsLimited 10.03.2010

Sahyadri City ManagementLimited 12.03.2010

Warasgaon Power Supply Limited 12.03.2010

Hill City Service ApartmentsLimited 26.03.2010

Baharampore-Farakka Highways Limited, Farakka-Raiganj Highways Limited, Raiganj-DalkholaHighways Limited the direct subsidiaries of theCompany shall close their first financial year onMarch 31, 2011 and therefore no accounts have beenprepared by these companies for the period endedMarch 31, 2010.

HCC Realty Limited subsidiary of HCC Real EstateLimited shall close its first financial year on March31, 2011 and therefore no accounts have beenprepared by this company for the period ended March31, 2010.

Verzon Hospitality Limited, Rhapsody HospitalityLimited, Valley View Entertainment Limited,Andromeda Hotels Limited, Sirrah Palace HotelsLimited, Whistling Thrush Facilities Services Limited,Warasgaon Tourism Limited, Our Home ServiceApartments Limited, Sahyadri City ManagementLimited, Warasgaon Power Supply Limited, Hill CityService Apartments Limited which are the directsubsidiaries of Lavasa Corporation Limited shall closetheir first financial year on March 31, 2011 andtherefore no accounts have been prepared by thesecompanies for the period ended March 31, 2010.

A Statement pursuant to Section 212 of the CompaniesAct, 1956 containing the details of subsidiaries of theCompany, forms part of the Annual Report.

In terms of the approval granted by the CentralGovernment under Section 212(8) of the CompaniesAct, 1956, vide its letter bearing number 47/156/2010-CL-III dated March 19, 2010 the copies of the BalanceSheet, Profit and Loss Account, Reports of the Boardof Directors and the Auditors’ of the SubsidiaryCompanies for the year ended March 31, 2010 arenot attached to the Balance Sheet of the Company.The Company will make available the annualaccounts and other related detailed information ofthe following subsidiaries upon request by anymember / investor of the Company / SubsidiaryCompanies:

1. Hincon Technoconsult Ltd2. Western Securities Ltd3. Pune Paud Toll Road Company Ltd4 Nirmal BOT Ltd5. Badarpur Faridabad Tollway Ltd6. HCC Infrastructure Ltd7. HCC Aviation Ltd8. Panchkutir Developers Ltd9. Highbar Technologies Ltd10. HCC Construction Ltd11. HCC Mauritius Enterprises Ltd12. HCC Singapore Enterprises Pte. Ltd13. HCC Real Estate Ltd14. HRL Township Developers Ltd15. HRL (Thane) Real Estate Ltd16. Nashik Township Developers Ltd17. Maan Township Developers Ltd18. Charosa Wineries Ltd19. Powai Real Estate Developers Ltd20. Lavasa Corporation Ltd21. Lavasa Hotel Ltd22. Warasgaon Lake View Hotels Ltd (formerly known

as Lavasa Star Hotel Ltd)23. Apollo Lavasa Health Corporation Ltd24. Lakeshore Watersports Company Ltd25. Dasve Convention Centre Ltd26. Dasve Business Hotel Ltd27 Ecomotel Hotel Ltd28. Dasve Hospitality Institutes Ltd29. Lakeview Clubs Ltd30. Dasve Retail Ltd31. Full Spectrum Adventure Ltd32. Spotless Laundry Services Ltd33. Lavasa Bamboocrafts Ltd34. Knowledge Vistas Ltd35. Green Hill Residences Ltd36. My City Technology Ltd37. Reasonable Housing Ltd38. Minfur Interior Technologies Ltd

Further, the annual accounts of the subsidiarycompanies will also be kept for inspection by any

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member / investor at the Company’s RegisteredOffice. The Company has presented the AuditedConsolidated Financial Statements and the same havebeen prepared in compliance with the AccountingStandard AS-21 issued by the Institute of CharteredAccountants of India (ICAI).

6.6.6.6.6. Acquisition of Controlling Stake in Karl SteinerAcquisition of Controlling Stake in Karl SteinerAcquisition of Controlling Stake in Karl SteinerAcquisition of Controlling Stake in Karl SteinerAcquisition of Controlling Stake in Karl SteinerAG, SwitzerlandAG, SwitzerlandAG, SwitzerlandAG, SwitzerlandAG, Switzerland

In March 2010, your Company agreed to acquirecontrolling stake i.e. 66% equity stake in Karl SteinerAG, Switzerland (KSAG), the second largest totalservices contractor in the Swiss Real Estate market.This is the Company’s first international acquisition.KSAG specialises in turnkey development of newbuildings and refurbishments and offers services inall facets of real estate construction.

KSAG was founded in 1915 and during its richhistory, KSAG has constructed over 1,200 residentialprojects, 540 office buildings, 45 hotels and 150social infrastructure buildings which includeuniversities, schools, hospitals, prisons and nursinghomes. Among KSAG’s many clients, for which thecompany has realized or renovated headquartersare Nestlé, Helvetia, Merck-Serono, Sanofi - Pasteurand the World Economic Forum. KSAG has alsobuilt laboratories for companies like IBM and theFederal Institute of Technology. In Zurich, KSAG hasconstructed/renovated the Park Hyatt, Radisson Blu,and The Savoy Hotels. Other significantaccomplishments for the company include Sihl City(a CHF 500 million integrated development includinga hotel, shopping center, offices and a residentialcomplex), Terminal A of the Zurich Airport, portionsof the Geneva airport, the Swiss Re conventioncenter and the home of Google Europe. In the pastten years, KSAG has completed nearly CHF 10 billionworth of real estate construction, which translatesto approximately 32 million square feet ofdevelopment.

Your Company agreed to acquire 66% stake by wayof issuance of new shares in consideration for CHF35 million cash investment in KSAG. KSAG shall usethe funds raised by the capital increase for its Swissoperations and the growth of the Company’s corebusiness in India’s growing residential andcommercial construction market

In 2014, in line with the envisaged successionprocess, KSAG’s sole owner Mr. Peter Steiner willsell his remaining shares to the Company. The shareswill be sold at a pre-agreed price based on KSAG’searnings achieved between 2010 and 2013.

The acquisition of KSAG shall bring a rich experienceof constructing world class integrated buildings toyour company.

Apart from this, the acquisition of KSAG shall bringthe following benefits to HCC: -

• Entry into the lucrative integrated buildingconstruction market in India, which is estimatedat Rs.65, 000 to Rs.75, 000 crores annually.

• Total solutions ability for a facility at a single source.

• Implementation of new technologies to supportsustainable and green development.

• Safe and fast construction processes.

• Access to many world class, cutting edgeEuropean technologies that will augment EPCofferings in India and other markets.

The transaction is subject to regulatory approvals inSwitzerland and India and shall close in the firstquarter of the FY 2010 -2011.

7.7.7.7.7. Employee Stock Option Scheme (ESOP)Employee Stock Option Scheme (ESOP)Employee Stock Option Scheme (ESOP)Employee Stock Option Scheme (ESOP)Employee Stock Option Scheme (ESOP)

In accordance with the approval of the Board ofDirectors and the Shareholders of the Company, theESOP Compensation Committee at its Meeting heldon July 20, 2009 re-priced the 41,31,600 number ofOptions (after adjusting for Options lapsed) alreadygranted by the Company on April 25, 2008 underHCC Employee Stock Option Scheme at Rs.104.05per Option (earlier Rs.132.50 per Option).

Further, out of total 43,25,350 Options granted (inforce) 7,70,880 number of Options have been vestedwith the employees during the year.

The particulars with regard to the Stock Options asrequired to be disclosed pursuant to the provision ofClause 12 of SEBI (Employee Stock Option Schemeand Employee Stock Purchase Scheme) Guidelines1999, as amended as on March 31, 2010 are set outin the Annexure IAnnexure IAnnexure IAnnexure IAnnexure I to this Report.

8.8.8.8.8. a)a)a)a)a) Raising of Funds through Qualified InstitutionalRaising of Funds through Qualified InstitutionalRaising of Funds through Qualified InstitutionalRaising of Funds through Qualified InstitutionalRaising of Funds through Qualified InstitutionalPlacement and Increase in Paid-up EquityPlacement and Increase in Paid-up EquityPlacement and Increase in Paid-up EquityPlacement and Increase in Paid-up EquityPlacement and Increase in Paid-up EquityShare CapitalShare CapitalShare CapitalShare CapitalShare Capital

During the year under review, your Companysuccessfully raised funds aggregatingRs. 4,80,10,50,000/- (Rupees four hundred eighty croreten lakhs fifty thousand only) through QualifiedInstitutional Placement of 4,70,00,000 Equity Sharesof nominal / face value Re. 1/- each at an issue priceof Rs. 102.15 per Equity Share (inclusive of premiumof Rs. 101.15 per Equity Share).

This has resulted in increasing the Paid up EquityShare Capital of the Company from 25,62,49,600Equity Shares of Re. 1/- each aggregatingRs. 25,62,49,600/- (Rupees twenty five crore sixtytwo lakhs forty nine thousand six hundred only)to 30,32,49,600 Equity Shares of Re. 1/- eachaggregating Rs. 30,32,49,600/- (Rupees thirtycrore thirty two lakhs forty nine thousand sixhundred only).

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The entire issue proceeds aggregating Rs.480.11crore have been utilized by the Company towardsfinancing of capital expenditure, meeting theworking capital requirements of the Companyand repayment of loans in terms of the objectsof the issue.

b)b)b)b)b) Status of GDSs / FCCBs & Utilisation of ProceedsStatus of GDSs / FCCBs & Utilisation of ProceedsStatus of GDSs / FCCBs & Utilisation of ProceedsStatus of GDSs / FCCBs & Utilisation of ProceedsStatus of GDSs / FCCBs & Utilisation of ProceedsDuring the financial year 2005-06, the Companyhad made a combined offering of GlobalDepository Shares (GDSs) and Foreign ConvertibleBonds (FCCBs) for an aggregate amount of USD200 million. The FCCBs and underlying equityshares of GDSs have been allotted on March 29,2006. As at March 31, 2010, out of 2,69,54,200underlying equity shares of GDSs, 1,40,146 GDSshave remained outstanding which forms part ofthe existing paid up capital of the Company.During the year under review, none of the bondholders have exercised their option forconversion of FCCBs into equity shares. However,the Company had re-purchased and cancelled3.4% of its outstanding Zero Coupon ForeignCurrency Convertible Bonds (FCCBs) due 2011of USD 1,00,000 each aggregating to USD 3.4million (Nominal Value) in accordance with theGuidelines prescribed by Reserve Bank of India.As at March 31, 2010, 966 FCCBs of the nominalvalue of USD 1,00,000/- each aggregating toUSD 96.60 million have remained outstanding.The entire issue proceeds from aforesaid issueof GDSs & FCCB aggregating to Rs.869.54 crorehave been utilized by the Company towardsfinancing of capital expenditure and for meetingthe working capital requirements of the Companyin terms of the objects of the issue.

9.9.9.9.9. Constitution of Selection CommitteeConstitution of Selection CommitteeConstitution of Selection CommitteeConstitution of Selection CommitteeConstitution of Selection CommitteeThe Company formed a Selection committee duringthe financial year 2009-10 as per the requirements ofDirectors’ Relatives (Office or Place of Profit) Rules,2003 to deal with matters concerning the appointmentand remuneration of relatives of Director for holdingoffice or place of profit in the Company. TheCommittee comprises of three Directors; namely,Mr. Nirmal P. Bhogilal, Chairman and IndependentDirector, Mr. Ram P. Gandhi, Independent Director,Mr. Anil Singhvi, Independent Director and oneMr. Ashish Singh, an expert who is MBA (HarvardBusiness School) & B.A. Economics (HarvardCollege), the Managing Director of Bain & Co., Indiawith significant experience in organization redesign,across multiple industries.Pursuant to the provisions of Section 314(IB) of theCompanies Act, 1956 and rules made thereon, theSelection Committee & the Board of Directors in itsmeeting held on October 23, 2009 and Shareholders ofthe Company through Postal Ballot had approved the

appointment and remuneration of Mr. Arjun Dhawan, arelative (son-in-law) of Mr. Ajit Gulabchand, Chairman& Managing Director of the Company, to hold andcontinue to hold an office or Place of Profit as aPresident–HCC Infrastructure Business of the Companywith effect from November 01, 2009, remuneration beingsubject to the approval of the Central Government.

10.10.10.10.10. Consolidated Financial StatementsConsolidated Financial StatementsConsolidated Financial StatementsConsolidated Financial StatementsConsolidated Financial Statements

As stipulated by Clause 32 of the Listing Agreementwith the Stock Exchanges, the attached consolidatedfinancial statements have been prepared inaccordance with the Accounting Standard AS-21 &AS-27 read with Accounting Standard AS-23 onAccounting for Investments in Associates.

11.11.11.11.11. Corporate GovernanceCorporate GovernanceCorporate GovernanceCorporate GovernanceCorporate Governance

A separate section titled “Corporate Governance”including a certificate from the Auditors of theCompany confirming compliance of the conditionsof Corporate Governance as stipulated underClause 49 of the Listing Agreement is annexed heretoand forms part of the Report.

12.12.12.12.12. DirectorsDirectorsDirectorsDirectorsDirectors

Retirement by rotationRetirement by rotationRetirement by rotationRetirement by rotationRetirement by rotation

As per the provisions of the Companies Act, 1956 readwith Article 152 of the Articles of Association of theCompany Mr. D.M. Popat and Mr. Y.H. Malegam arethe Directors of the Company to retire by rotation andbeing eligible, offer themselves for re-appointment.

Appointment of the Directors of the CompanyAppointment of the Directors of the CompanyAppointment of the Directors of the CompanyAppointment of the Directors of the CompanyAppointment of the Directors of the Company

MrMrMrMrMr. K. G. T. K. G. T. K. G. T. K. G. T. K. G. Tendulkarendulkarendulkarendulkarendulkar

The tenure of Mr. K. G. Tendulkar as DeputyManaging Director of the Company expired onNovember 7, 2009. The Board of Directors place onrecord its appreciation of the contributions made andthe valuable services rendered by him during histenure as Executive Director (Operations) and DeputyManaging Director of the Company.

The Board of Director of the Company at its Meetingheld on October 23, 2009 appointed Mr. K. G.Tendulkar as an Additional Director of the Companywith effect from November 8, 2009, who holds officeupto the date of the forthcoming Annual GeneralMeeting and is eligible for appointment as a Directorof the Company.

MrMrMrMrMr. Anil C. Singhvi. Anil C. Singhvi. Anil C. Singhvi. Anil C. Singhvi. Anil C. Singhvi

Mr. Anil C. Singhvi, was appointed as a Director ofthe Company by the Board of Directors at its Meetingheld on July 27, 2007 to fill in the casual vacancycaused in the Board due to the resignation by Mr. R.G. Vartak, who holds office upto the date of theforthcoming Annual General Meeting and is eligiblefor appointment as a Director of the Company.

All these directors have filed Form DD-A with theCompany as required under the Companies

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(Disqualification of Directors under Section 274(1)(g) of the Companies Act, 1956) Rules, 2003.

Brief particulars and expertise of these Directors andtheir other directorship and committee membershiphave been given in the Report on the CorporateGovernance and in the Notice of the ensuing AnnualGeneral Meeting of the Company.

13.13.13.13.13. Directors’ Responsibility StatementDirectors’ Responsibility StatementDirectors’ Responsibility StatementDirectors’ Responsibility StatementDirectors’ Responsibility Statement

In accordance with the provisions of Section 217(2AA)of the Companies Act, 1956, with regard to theDirectors’ responsibility statement, the Board ofDirectors confirms that:

a) in the preparation of the annual accounts, theapplicable accounting standards have beenfollowed and there has been no materialdeparture;

b) the selected accounting policies were appliedconsistently and the Directors made judgmentsand estimates that are reasonable and prudentso as to give a true and fair view of the state ofaffairs of the Company as at March 31, 2010 andof the profits of the Company for the year endedon that date.

c) proper and sufficient care has been taken for themaintenance of adequate accounting records inaccordance with the provisions of the CompaniesAct,1956 for safeguarding the assets of theCompany and for preventing and detecting fraudand other irregularities.

d) the annual accounts have been prepared on agoing concern basis.

14.14.14.14.14. Industrial RelationsIndustrial RelationsIndustrial RelationsIndustrial RelationsIndustrial Relations

The industrial relations continue to be generallypeaceful and cordial.

15.15.15.15.15. TTTTTransfer to Investor Education and Protection Fundransfer to Investor Education and Protection Fundransfer to Investor Education and Protection Fundransfer to Investor Education and Protection Fundransfer to Investor Education and Protection Fund(IEPF)(IEPF)(IEPF)(IEPF)(IEPF)

The Company has, during the year under review,transferred a sum of Rs.7.94 lacs to InvestorEducation and Protection Fund, in compliance withthe provisions of Section 205C of the CompaniesAct, 1956. The said amount represents dividend,debentures and interest on debentures whichremained unclaimed by the shareholders / debentureholders of the Company for a period exceeding 7years from their respective due dates of payment.

16.16.16.16.16. Particulars of Employees and other additionalParticulars of Employees and other additionalParticulars of Employees and other additionalParticulars of Employees and other additionalParticulars of Employees and other additionalinformation.information.information.information.information.

The information required under Section 217 (2A) of theCompanies Act, 1956 and the Rules made there under

is given in the Annexure to this Report and forms partof the Report. However, in terms of Section 219(1) (b)(iv) of the Companies Act, 1956, the Report andAccounts are being sent to the shareholders excludingthe aforesaid Annexure. Any Shareholder interested inobtaining copy of the same may write to the CompanySecretary at the Registered Office of the Company.

17.17.17.17.17. Conservation of EnergyConservation of EnergyConservation of EnergyConservation of EnergyConservation of Energy, technology absorption and, technology absorption and, technology absorption and, technology absorption and, technology absorption andforeign exchange earnings and outgo.foreign exchange earnings and outgo.foreign exchange earnings and outgo.foreign exchange earnings and outgo.foreign exchange earnings and outgo.

The information relating to the conservation ofenergy, technology absorption and foreign exchangeearnings and outgo as required to be disclosed underthe Companies (Disclosure of particulars in the Reportof the Board of Directors) Rules 1988, is given in theAnnexure II forming part of this Report.

18.18.18.18.18. AuditorsAuditorsAuditorsAuditorsAuditors

M/s K. S. Aiyar & Co., Chartered Accountants,Mumbai, Auditors of the Company, bearing ICAIRegistration No. 100186W retire at the ensuingAnnual General Meeting and are eligible for re-appointment. They have furnished a certificate to theeffect that their proposed appointment, if made willbe in accordance with the limits specified undersection 224(1-B) of the Companies Act, 1956.

19.19.19.19.19. Auditors’ ReportAuditors’ ReportAuditors’ ReportAuditors’ ReportAuditors’ Report

The Auditors’ Report to the shareholders does notcontain any qualification.

20.20.20.20.20. AcknowledgementsAcknowledgementsAcknowledgementsAcknowledgementsAcknowledgements

Your Directors would like to express their sincereappreciation to the Financial Institutions, Banks, Centraland State Governments and the Company’s valuedinvestors for their continued co-operation and support.

Your Directors also take this opportunity toacknowledge the dedicated efforts made by workers,staff, and officers at all level for their contribution tothe success achieved by the Company.

For and on behalf of the Board of Directors

AJIT GULABCHANDChairman & Managing Director

Registered Office:Registered Office:Registered Office:Registered Office:Registered Office:Hincon HouseLal Bahadur Shastri MargVikhroli (West)Mumbai-400 083

Place: MumbaiDated: April 30, 2010

HCC 84TH ANNUAL REPORT 2009-201054

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Disclosure pursuant to the provisions of Securities and Exchange Board of India, (Employee Stock OptionDisclosure pursuant to the provisions of Securities and Exchange Board of India, (Employee Stock OptionDisclosure pursuant to the provisions of Securities and Exchange Board of India, (Employee Stock OptionDisclosure pursuant to the provisions of Securities and Exchange Board of India, (Employee Stock OptionDisclosure pursuant to the provisions of Securities and Exchange Board of India, (Employee Stock OptionScheme and Employee Stock Purchase Scheme) Guidelines, 1999 as on March 31, 2010.Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 as on March 31, 2010.Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 as on March 31, 2010.Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 as on March 31, 2010.Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 as on March 31, 2010.

Employees Stock Option SchemeEmployees Stock Option SchemeEmployees Stock Option SchemeEmployees Stock Option SchemeEmployees Stock Option Scheme

a) Options granted 46,52,550

b) The Pricing formula The Closing market price on the Stock Exchange, which recorded thehighest Trading Volume in the Company’s share prior to the date of theMeeting of ESOP Compensation Committee in which Options weregranted / re-priced.

c) Options vested 7,70,880

d) Options exercised Nil

e) Total No. of shares arising as aresult of exercise of Options Nil

f) Options lapsed 3,27,200.

g) Variation of terms of Options In accordance with the approval of the Board of Directors and theShareholders of the Company, ESOP Compensation Committee at itsMeeting held on July 20, 2009 had re-priced the 41,31,600 Options alreadygranted by the Company at Rs.104.05 per Option (earlier Rs.132.50 perOption).

h) Money realized by exercisableOptions Nil

i) Total No. of Options in force 43,25,350

j) Employee wise details of Options granted to:

SrSrSrSrSr. No.. No.. No.. No.. No. Directors & Senior Managerial PersonnelDirectors & Senior Managerial PersonnelDirectors & Senior Managerial PersonnelDirectors & Senior Managerial PersonnelDirectors & Senior Managerial Personnel Number ofNumber ofNumber ofNumber ofNumber ofNamesNamesNamesNamesNames DesignationsDesignationsDesignationsDesignationsDesignations Options grantedOptions grantedOptions grantedOptions grantedOptions granted

1. Mr. Y. H. Malegam Director 34,300

2. Mr. Rajas R. Doshi Director 34,300

3. Mr. D. M. Popat Director 34,300

4. Mr. Ram P. Gandhi Director 34,300

5. Prof. Fred Moavenzadeh Director 34,300

6. Mr. Sharad M. Kulkarni Director 34,300

7. Mr. Nirmal P. Bhogilal Director 34,300

8. Mr. Anil Singhvi Director 34,300

9. Mr. K. G. Tendulkar* Director 6,17,600

10. Mr. Vinayak Deshpande President & COO – HCC (E & C) 1,93,750

11 Mr. Rajgopal Nogja President – Lavasa & HREL 1,71,600

12 Mr. P. Chakrapani Executive Vice-President – HCC Infrastructure 76,900

13 Mr. Praveen Sood* Group Chief Financial Officer 2,74,500

14 Mr. Arun Karambelkar* Group Executive Vice-President- Integrated 2,74,500Resources Management

15 Mr. Aditya Jain Group Executive Vice-President – Human Resources 2,00,300

16 Mr. S.K. Dharmadhikari* Executive Vice-President – Business Development 3,43,200& Construction Solutions

17 Mr. N. R. Acharyulu* Executive Vice-President – Water Business 3,43,200

Annexure to the Directors’ Report: I

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18 Mr. Parvez Alam* Vice President – Hydro & Transport 3,43,200

19 Mr. D. M. Kudtarkar* Vice President -Tendering & Construction Solutions 3,43,200

20 Mr. K. R. Visvanath* Vice President – Nuclear & Thermal & SpecialProjects Business 2,28,700

21 Mr. S.W. Gaitonde* Vice President – EPC (Kishanganga HEP) 2,28,700

22 Mr. V. P. Kulkarni Company Secretary 1,37,200

23 Mr. Jimmy Mogal Vice President – Corporate Communications 1,37,200

24 Mr. Satish Pendse Chief Information Officer 1,37,200

TTTTTotal No. of Options otal No. of Options otal No. of Options otal No. of Options otal No. of Options outstandingoutstandingoutstandingoutstandingoutstanding 43,25,35043,25,35043,25,35043,25,35043,25,350

Identified employees who were granted Options, during any one year, equal to orexceeding 1% of the issued capital of the Company at the time of grant. Nil

* Employees who have been granted Options amounting to 5% or more of the total Options granted.

For and on behalf of the Board of Directors

AJIT GULABCHANDChairman & Managing Director

Registered Office:Registered Office:Registered Office:Registered Office:Registered Office:Hincon HouseLal Bahadur Shastri MargVikhroli (West)Mumbai-400 083

Place: MumbaiDated: April 30, 2010

SrSrSrSrSr. No.. No.. No.. No.. No. Directors & Senior Managerial PersonnelDirectors & Senior Managerial PersonnelDirectors & Senior Managerial PersonnelDirectors & Senior Managerial PersonnelDirectors & Senior Managerial Personnel Number ofNumber ofNumber ofNumber ofNumber ofNamesNamesNamesNamesNames DesignationsDesignationsDesignationsDesignationsDesignations Options grantedOptions grantedOptions grantedOptions grantedOptions granted

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Information as per section 217 (1) (e) of the CompaniesInformation as per section 217 (1) (e) of the CompaniesInformation as per section 217 (1) (e) of the CompaniesInformation as per section 217 (1) (e) of the CompaniesInformation as per section 217 (1) (e) of the CompaniesAct, 1956 read with the Companies (Disclosure ofAct, 1956 read with the Companies (Disclosure ofAct, 1956 read with the Companies (Disclosure ofAct, 1956 read with the Companies (Disclosure ofAct, 1956 read with the Companies (Disclosure ofparticulars in the Report of the Board of Directors)particulars in the Report of the Board of Directors)particulars in the Report of the Board of Directors)particulars in the Report of the Board of Directors)particulars in the Report of the Board of Directors)Rules, 1988Rules, 1988Rules, 1988Rules, 1988Rules, 1988

I.I.I.I.I. Conservation of EnergyConservation of EnergyConservation of EnergyConservation of EnergyConservation of Energy

a)a)a)a)a) Energy Conservation Measures TEnergy Conservation Measures TEnergy Conservation Measures TEnergy Conservation Measures TEnergy Conservation Measures Taken:aken:aken:aken:aken:

• HCC is continuing with energy savingmeasures initiated earlier like usage of LoadSharing System in D.G. plants, APFC(Automatic Power Factor Controller) panelsfor GRID Power, FCMA (Flux CompensatedMagnetic Amplifier) Starter for CrusherMotors, Variable Frequency Drive (VFD)Starting System for Ventilation Fans andTunnel Excavation Machines (Road Header)

• In this year we have introduced Solar WaterHeating System at Nimoo Bazgo Projectwhich reduces input power requirement.

b)b)b)b)b) Additional investment and proposals, if anyAdditional investment and proposals, if anyAdditional investment and proposals, if anyAdditional investment and proposals, if anyAdditional investment and proposals, if anybeing implemented for reduction inbeing implemented for reduction inbeing implemented for reduction inbeing implemented for reduction inbeing implemented for reduction inconsumption of Energy:consumption of Energy:consumption of Energy:consumption of Energy:consumption of Energy:

• Introduction of Lighting Energy Saver (About10 %) in GRID Power circuit at Project sitesLocations like Camp, Office, Yard & AreaLighting etc.

c)c)c)c)c) Impact of measures at (a) and (b) above forImpact of measures at (a) and (b) above forImpact of measures at (a) and (b) above forImpact of measures at (a) and (b) above forImpact of measures at (a) and (b) above forreduction of Energy consumption andreduction of Energy consumption andreduction of Energy consumption andreduction of Energy consumption andreduction of Energy consumption andconsequent impact on the production of goods:consequent impact on the production of goods:consequent impact on the production of goods:consequent impact on the production of goods:consequent impact on the production of goods:

Energy conservation measures continue toreduce the production cost per unit withreference to energy consumption.

d) Td) Td) Td) Td) Total energy consumption and energyotal energy consumption and energyotal energy consumption and energyotal energy consumption and energyotal energy consumption and energyconsumption per unit as per form –A ofconsumption per unit as per form –A ofconsumption per unit as per form –A ofconsumption per unit as per form –A ofconsumption per unit as per form –A ofAnnexure to the rules of Industries specifiedAnnexure to the rules of Industries specifiedAnnexure to the rules of Industries specifiedAnnexure to the rules of Industries specifiedAnnexure to the rules of Industries specifiedin the schedule thereto:in the schedule thereto:in the schedule thereto:in the schedule thereto:in the schedule thereto:

Not Applicable

II.II.II.II.II. TTTTTechnology Absorptionechnology Absorptionechnology Absorptionechnology Absorptionechnology Absorption

Efforts made in technology absorption as per Form-B of the Annexure to the Rules.

1.1.1.1.1. Research and Development (R&D)Research and Development (R&D)Research and Development (R&D)Research and Development (R&D)Research and Development (R&D)

Rapid changes in the area of infrastructurecreation and management has resulted in newdemands in terms of competitiveness,understanding and adoption of new constructionmaterials and technology. HCC has been givinga thrust on research and development activities,which include process improvement, adoptionof new construction materials and technology,and innovation. Besides the in-house efforts todevelop appropriate technology, efforts are also

Annexure to the Directors’ Report: II

being made to identify technology in other areasand study its possible use in the construction.

Innovative work by your Company’s engineershas resulted in improvements in various areasof operations. The areas wherein newtechnologies are being examined for applicationinclude:

• Use of new construction materials

• Development of new constructionmethodologies

• Use of IT and communication tools formonitoring and improving productivity.

• Indigenous Tunnel monitoring softwaredeveloped and used in Vizag cavern

• Asset utilization and life extension

• The Company has spent Rs.40.34 lakhstowards Research & Development expenses,and substantial progress to pioneer effortsin Indian Industry is envisaged.

2.2.2.2.2. TTTTTechnology Absorption, Adaptat ion &echnology Absorption, Adaptat ion &echnology Absorption, Adaptat ion &echnology Absorption, Adaptat ion &echnology Absorption, Adaptat ion &InnovationInnovationInnovationInnovationInnovation

a) Efforts made towards technology absorption,adaptation and innovation during the year2009-10 are:

• For Kishenganga Hydroelectric project,proposal for adopting double shield typeof Tunnel boring machine is beingstudied which has advantages ofovercoming adverse geologicalchallenges and continuous segmenterection.

• For Kishenganga Hydroelectric project,proposal for adoption of Concrete facerockfill dam [CFRD] has been finalizedwhich has got cost advantages overconventional concrete dams. For thefoundation, plastic cut off wall is beingadopted by using modern hydromillequipment.

• For Nimoo Bazgo Hydroelectric project,concreting was done in extremely coldtemperatures by providing thermalblanket to concrete surface forovercoming temperature drop effect. Forconcrete, special admixtures were usedto achieve the desired setting within theallowable time in the extreme coldtemperatures

• For Nimoo Bazgo & Chutak Hydroelectricproject, aviation turbine fuel was usedas an additive in fuel for equipmentsworking in high altitude.

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• For Vizag cavern undergroundexcavation, bulk underground liquidexplosives were used which resulted inreduction in time cycle and better yield.By adopting this technique, recordexcavation of 1,00,000 cum/month wasachieved

• For Dagachu Hydroelectric project, inorder to speed up construction, raiseboring machine for excavation of pilothole for surge shaft and for excavationof full cross section of pressure shafthas been finalized.

• For Dagachu Hydroelectric project, inorder to accelerate tunneling progress,use of ITC tunnel loader in combinationwith reversible dumper is being finalized.

In the past, significant efforts have beenmade to absorb foreign technologyincluding methods /equipments forbridge construction and tunnelconstruction.

• HCC has deployed specialized selfclimbing formwork for construction oftall and slender pylon legs for the pylonsof the cable stayed bridges of the BandraWorli Sea Link. This formwork hasenabled HCC to achieve the complicatedgeometry of the pylons with demandingaccuracy and the desired aestheticappeal has made the pylons as thesignature feature of the Bandra Worli SeaLink.

• HCC engineers have developedcapabilities to design complicatedsegment casting moulds for theBadarpur Elevated High Way Project.This capability has been developed withthe assistance of a Specialist designerfrom Switzerland.

• A beginning has been made to achievecapabilities for in house design ofLaunching Girders (at AP8 andGosikhurd Projects), Traveling formworks (at Chamera and Uri projects).

• HCC has designed and constructed OverTopping Cofferdam using geosyntheticmaterial and gabion Mattresses to saveon re-making cost and time. This hasbeen successfully adopted at LohariNagpala Project.

• Double Shield Tunnel Boring Machine(TBM) is being used at Veligonda projectfor excavating large diameter very long

water tunnel, with continuous conveyorfor mucking and simultaneousinstallation of precast segmental lining.

• New Austrian Tunneling Method (NATM)is being used of Pir Panjal tunnels inJammu and Kashmir using TunnelVersion excavators and Road Headers.

b) Benefits derived as a result of the aboveefforts :

Reduction in cycle time of construction ofdifferent components and thereby increasingof productivity.

Development of Human Resource in use ofadvanced technology with modernequipment and technology.

c) Technology Year of Has technologyImported import been fully

absorbed

Use of reverse 2001 Fully absorbedcirculation Drill forpilling

Use of 55C 15 2003 Absorbed

Fressyinet System forPrestressing

Hydro jetting 2005 Fully absorbedtechnology forconcrete skinning

Computerized 2005 Fully absorbedboomers

Steel corrugated tunnels2005 Fully absorbed

Use of free flow 2005 Fully absorbed(no slump) concrete inhighly congested area

Road Header 2006 Absorbed

De-Dusting System 2006 Absorbedfor Road Header

Tunnel version 2006 Absorbedexcavator

Box pushing technique 2007 Absorbedfor construction ofunder existing roadwithout disturbing trafficon existing road atChennai Road Project

Use of Geo textile bags 2007 Absorbedreplacing bouldercratepitching for TeestaDiversion scheme

Use of Fly ash for 2008 Absorbedembankment and REwall backfilling

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Orica Emulsion base 2008 Absorbedexplosive & Powerdetlong delay detonators

Roller Compacted 2008 UnderConcrete Technology at ImplementationTeesta Project

Wassara drilling Equipment 2008 Absorbed(unique method of drillingby using water power)

Cold weather concreting 2008 Absorbedsystem and Protectionworks when atmospherictemperature is below 5°C

III.III.III.III.III. Foreign Exchange earnings and outgo:Foreign Exchange earnings and outgo:Foreign Exchange earnings and outgo:Foreign Exchange earnings and outgo:Foreign Exchange earnings and outgo:

(a) Activities relating to exports, initiative taken toincrease exports, development of new exportmarket for production services and export plans:

Visits are being made by technical and marketingpersonnel to develop new export markets fromtime to time.

Technology Year of Has technologyImported import been fully

absorbed

(b) Total Foreign Exchange used and earned:

The information on Foreign Exchange earningsand outgo is contained in Note no. 18 (B) and(D) of Schedule Q forming part of the accounts.

For and on behalf of Board of Directors,

AJIT GULABCHANDChairman & Managing Director

Registered Office:Registered Office:Registered Office:Registered Office:Registered Office:Hincon HouseLal Bahadur Shastri MargVikhroli (West)Mumbai 400 083

Place: MumbaiDate: April 30, 2010

HCC 84TH ANNUAL REPORT 2009-201059

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Auditors’ Report

TTTTTo the Members ofo the Members ofo the Members ofo the Members ofo the Members of

Hindustan Construction Company LimitedHindustan Construction Company LimitedHindustan Construction Company LimitedHindustan Construction Company LimitedHindustan Construction Company Limited

Report on the accounts for the year ended on 31st March,2010 in compliance with Section 227(2) of the CompaniesAct, 1956

1. We have audited the attached Balance Sheet ofHindustan Construction Company Limited, as at 31stMarch, 2010 and also the Profit and Loss Accountfor the year ended on that date annexed thereto andthe Cash Flow statement for the year ended on thatdate. These financial statements are the responsibilityof the Company’s management. Our responsibility isto express an opinion on these financial statementsbased on our audit.

2. We conducted our audit in accordance with auditingstandards generally accepted in India. ThoseStandards require that we plan and perform the auditto obtain reasonable assurance about whether thefinancial statements are free of materialmisstatement. An audit includes examining, on a testbasis, evidence supporting the amounts anddisclosures in the financial statements. An audit alsoincludes assessing the accounting principles usedand significant estimates made by management, aswell as evaluating the overall financial statementpresentation. We believe that our audit provides areasonable basis for our opinion.

3. We did not audit the financial statements of certainIntegrated Joint Ventures reflecting Company’s sharein Loss(Net) of Rs.2.88 Crore in these financialstatements. These financial statements have beenaudited by other auditors whose report(s) have beenfurnished to us, and our opinion, in so far as it relatesto the amounts included in respect of the said auditedJoint Ventures, is based solely on the Report of theother auditors.

4. As required by the Companies (Auditor’s Report)Order, 2003 as amended by Companies (Auditor’sReport) (Amendment) Order, 2004 issued by theCentral Government of India in terms of sub-section(4A) of section 227 of the Companies Act, 1956, weenclose in the Annexure a statement on the mattersspecified in paragraphs 4 and 5 of the said Order.

5. Further to our comments in the Annexure referredto above, we report that:

(a) We have obtained all the information andexplanations, which to the best of our knowledgeand belief, were necessary for the purposes ofour audit;

(b) In our opinion, proper books of account asrequired by law have been kept by the Companyso far as appears from our examination of thosebooks;

(c) The Balance Sheet, Profit and Loss Account andCash Flow Statement dealt with by this reportare in agreement with the books of account;

(d) In our opinion, the Balance Sheet, Profit and LossAccount and Cash Flow Statement dealt with bythis report comply with the accounting standardsreferred to in sub-section (3C) of section 211 ofthe Companies Act, 1956 to the extent applicable;

(e) On the basis of written representations receivedfrom the directors / companies, as on 31st March,2010, and taken on record by the Board ofDirectors we report that none of the directorsare disqualified as on 31st March, 2010 frombeing appointed as a director in terms of clause(g) of sub-section (1) of section 274 of theCompanies Act, 1956.

(f) In our opinion and to the best of our informationand according to the explanations given to us,the said accounts give the information requiredby the Companies Act, 1956, in the manner sorequired and give a true and fair view inconformity with the accounting principlesgenerally accepted in India:

(i) In the case of the Balance Sheet, of the stateof affairs of the Company as at 31st March,2010;

(ii) In the case of the Profit and Loss Account,of the profit for the year ended on that date;and

(iii) In the case of Cash Flow Statement, of thecash flows for the year ended on that date.

For K.S.Aiyar & CoChartered Accountants

Registration Number;100186 W

Raghuvir M. AiyarPartner

Membership No.38128

Place: MumbaiDate: 30th April, 2010

HCC 84TH ANNUAL REPORT 2009-201060

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Annexure to the Auditors’ Report

(Referred to in paragraph 4 of our Report of even dateon the Accounts for the year ended on 31st March, 2010of Hindustan Construction Company Limited)

(i) The Company is maintaining proper recordsshowing full particulars including quantitativedetails and situation of Fixed Assets.

(ii) A substantial portion of the fixed assets have beenphysically verified by the management during theyear and in our opinion the frequency of suchverification is reasonable having regard to the sizeof the Company and the nature of its assets. Nomaterial discrepancies were noticed on suchphysical verification.

(iii) Fixed assets disposed off during the year werenot substantial. According to the information andexplanations given to us, we are of the opinionthat the disposal of fixed assets has not affectedthe going concern status of the Company.

(iv) The inventories have been physically verifiedduring the year by the management. In ouropinion, the frequency of verification is reasonable.

(v) The procedure of physical verification ofinventories followed by the management isreasonable and adequate in relation to the size ofthe Company and the nature of its business.

(vi) In our opinion and according to the informationand explanation given to us, the Company ismaintaining proper records of inventory. Thediscrepancies noticed on verification betweenphysical stocks and the book records were notmaterial and have been properly dealt with in thebooks of account.

(vii) The company has not granted unsecured loansand Inter-Corporate Deposits to companiescovered in the Register maintained under Section301 of the Act. Hence provisions of clause(iii)(b),(c),(d) of paragraph 4 are not applicable tothe Company.

(viii) The company has taken unsecured loans in theform of inter-corporate deposits from threecompanies covered in the Register maintainedunder Section 301 of the Companies Act, 1956.The maximum amount involved was Rs16.48crores and the balance at the year end wasRs.15.17 crores

(ix) Based on the information and explanations givento us, we are of the opinion that the rate of interestand other terms and conditions of loans takenfrom such parties covered in the Registermaintained under Section 301 are not prima facieprejudicial to the interests of the company.

(x) According to the information and explanationsgiven to us, repayments of the principal andinterest have been regularly made as stipulated.

(xi) In our opinion and according to the informationand explanations given to us, there is an adequateinternal control system commensurate with thesize of the Company and the nature of its business,for purchase of inventory and fixed assets and forthe Work Done. During the course of our audit,we have not observed any major weakness ininternal control system.

(xii) Based on the audit procedures applied by us andaccording to the information and explanationsprovided by the management, we are of theopinion that the particulars of contracts orarrangements referred to in section 301 of the Acthave been entered in the register required to bemaintained under that section. The transactionsmade in pursuance of such contracts orarrangements have been made at prices whichare reasonable having regard to prevailing marketprices at the relevant time.

(xiii) The Company has not accepted any deposits fromthe public within the meaning of Sections 58Aand 58AA of the Act and the rules framed thereunder. Therefore, the provisions of Section 58A,58AA and any other relevant provisions of theCompanies Act, 1956 and the rules framedthereunder with regard to deposits accepted fromthe public are not applicable to the Company.

(xiv) In our opinion, the Company has an internal auditsystem commensurate with the size and nature ofits business.

(xv) The Central Government has not prescribed themaintenance of cost records under section209(1)(d) of the Companies Act, 1956.

(xvi) According to the records of the Company,Provident Fund, Investor Education and ProtectionFund, Employees’ State Insurance, Income Tax,Sales Tax, Wealth Tax, Service Tax, Customs Duty,Excise Duty, Cess and other material statutorydues applicable to it have been generally regularlydeposited during the year with the appropriateauthorities. According to the information andexplanations given to us, no undisputed amountspayable in respect of above were in arrears, as atMarch 31, 2010 for a period of more than sixmonths from the date on which they becamepayable.

(xvii) According to the records of the Company, salestax, income tax, customs duty, wealth tax, servicetax, excise duty or cess which have not beendeposited on account of dispute are given below :

HCC 84TH ANNUAL REPORT 2009-201061

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Name of Nature of dues Year Amount Forum wherethe Statute Rs. crores dispute is

pending

Orissa Sales Reassessment of 2000-01 0.53 Sales TaxTax Turnover for Appellate

1997-98 to Tribunal2000-01

(xviii) The Company does not have any accumulatedlosses at the end of the financial year and has notincurred cash losses during the financial yearcovered by our audit and the immediatelypreceding financial year.

(xix) In our opinion and according to the informationand explanations given to us, the Company hasnot defaulted in repayment of dues to a financialinstitution, bank or debenture holders.

(xx) Based on our examination of the records and theinformation and explanations given to us, theCompany has not granted any loans and advanceson the basis of security by way of pledge of shares,debentures and other securities.

(xxi) In our opinion the Company is not a chit fund or anidhi / mutual benefit fund / society. Thereforethe provisions of clause 4(xiii) of the Companies(Auditor’s Report) (Amendment) Order, 2004 arenot applicable to the Company.

(xxii) In our opinion the Company is not dealing in ortrading in shares, securities, debentures and otherinvestments. Accordingly, the provisions of clause4 (xiv) of the Companies (Auditor’s Report)(Amendment) Order, 2004 are not applicable tothe Company.

(xxiii) In our opinion, the terms and conditions on whichthe Company has given guarantees for loans takenby others from banks or financial institutions arenot prejudicial to the interest of the Company.

(xxiv) In our opinion, the term loans have been appliedfor the purpose for which they were raised.

(xxv) According to the information and explanationsgiven to us and on an overall examination of thebalance sheet of the Company, we report that nofunds raised on short-term basis have been usedfor long-term investment.

(xxvi) According to the information and explanationsgiven to us, the Company has not made anypreferential allotment of shares to parties andcompanies covered in the register maintainedunder section 301 of the Companies Act, 1956.

(xxvii) The Company has created a security / charge in-respect of secured debentures issued andoutstanding at the year end.

(xxviii)The Company has not raised any money by wayof public issue during the year. The monies raisedon account of Bonds / GDS issue in the earlieryear have been utilised for the purpose for whichit was raised as disclosed in Note III (20) of Notesforming part of the Accounts.

(xxix) According to the information and explanationsgiven to us, no fraud on or by the Company hasbeen noticed or reported during the course of ouraudit.

For K.S.Aiyar & CoChartered Accountants

Registration Number;100186 W

Raghuvir M. AiyarPartner

Membership No.38128

Place: MumbaiDate: 30th April, 2010

HCC 84TH ANNUAL REPORT 2009-201062

CMYK

Balance Sheet as at 31st March, 2010

As atAs atAs atAs atAs at As at31.03.201031.03.201031.03.201031.03.201031.03.2010 31.03.2009

ScheduleScheduleScheduleScheduleSchedule Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs.CroreSOURCES OF FUNDSSOURCES OF FUNDSSOURCES OF FUNDSSOURCES OF FUNDSSOURCES OF FUNDSShare Capital AAAAA 30.3330.3330.3330.3330.33 25.63Share Warrants ————— 15.19Reserves and Surplus BBBBB 1,486.851,486.851,486.851,486.851,486.85 964.03

Total Shareholders’ Funds 1,517.181,517.181,517.181,517.181,517.18 1,004.85Loans(a) Secured CCCCC 963.03963.03963.03963.03963.03 904.10(b) Unsecured DDDDD 1,551.671,551.671,551.671,551.671,551.67 1,417.70

Total Loans 2,514.702,514.702,514.702,514.702,514.70 2,321.80Deferred Tax Liability (Net) 142.64142.64142.64142.64142.64 113.17

Total 4,174.524,174.524,174.524,174.524,174.52 3,439.82

APPLICAAPPLICAAPPLICAAPPLICAAPPLICATION OF FUNDSTION OF FUNDSTION OF FUNDSTION OF FUNDSTION OF FUNDSFixed Assets(a) Gross Block EEEEE 1,814.181,814.181,814.181,814.181,814.18 1,682.83(b) Less: Depreciation 664.49664.49664.49664.49664.49 554.65

(c) Net Block 1,149.691,149.691,149.691,149.691,149.69 1,128.18(d) Items Awaiting Completion or Commissioning 34.8534.8534.8534.8534.85 46.44

Total Fixed Assets 1,184.541,184.541,184.541,184.541,184.54 1,174.62

Investments FFFFF 408.69408.69408.69408.69408.69 365.50

Current Assets, Loans and Advances

A. Current Assets GGGGG

(a) Inventories 3,565.223,565.223,565.223,565.223,565.22 2,776.64

(b) Sundry Debtors 2.652.652.652.652.65 4.71

(c) Cash and Bank Balances 188.32188.32188.32188.32188.32 153.87

(d) Other Current Assets 4.794.794.794.794.79 3.81

3,760.983,760.983,760.983,760.983,760.98 2,939.03

B. Loans and Advances HHHHH 863.26863.26863.26863.26863.26 528.35

Total Current Assets, Loans and Advances 4,624.244,624.244,624.244,624.244,624.24 3,467.38

Less: Current Liabilities and Provisions IIIII(a) Current Liabilities 1,852.001,852.001,852.001,852.001,852.00 1,402.60(b) Provisions 190.95190.95190.95190.95190.95 165.08

Total Current Liabilities and Provisions 2,042.952,042.952,042.952,042.952,042.95 1,567.68

Net Current Assets 2,581.292,581.292,581.292,581.292,581.29 1,899.70

Total 4,174.524,174.524,174.524,174.524,174.52 3,439.82

The Annexed Notes (Schedule - Q) form an integral part of the Accounts.

}As per our report attached AJIT GULABCHAND Chairman & Managing DirectorFor K.S. AIYAR & CO.Chartered Accountants VINAYAK DESHPANDE Y.H. MALEGAMRegistration No. 100186W President and K.G. TENDULKAR

Chief Operating Officer RAJAS R. DOSHIRAGHUVIR M. AIYAR D.M. POPATPartner PRAVEEN SOOD RAM P. GANDHI DirectorsMembership No. 38128 Group Chief Financial Officer PROF. FRED MOAVENZADEH

SHARAD M. KULKARNIVITHAL P. KULKARNI NIRMAL P. BHOGILAL

Company Secretary ANIL SINGHVI

Mumbai, Dated: 30th April, 2010 Mumbai, Dated: 30th April, 2010

HCC 84TH ANNUAL REPORT 2009-201063

CMYK

Profit and Loss Account for the year ended 31st March, 2010

PreviousYear

ScheduleScheduleScheduleScheduleSchedule Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

INCOMEINCOMEINCOMEINCOMEINCOMEIncome from Operations JJJJJ 3,862.973,862.973,862.973,862.973,862.97 3,518.32Less: Company’s Share of Turnover in

Integrated Joint Ventures 218.77218.77218.77218.77218.77 204.62

3,644.203,644.203,644.203,644.203,644.20 3,313.70Company’s Share of Profit/(Loss) inIntegrated Joint Ventures (14.99)(14.99)(14.99)(14.99)(14.99) 0.06Other Income KKKKK 13.0113.0113.0113.0113.01 58.83

3,642.223,642.223,642.223,642.223,642.22 3,372.59EXPENDITUREEXPENDITUREEXPENDITUREEXPENDITUREEXPENDITUREConstruction Expenses LLLLL 2,647.682,647.682,647.682,647.682,647.68 2,390.14Employees’ Remuneration and Benefits MMMMM 394.35394.35394.35394.35394.35 374.90Office and Site Establishment Expenses NNNNN 159.30159.30159.30159.30159.30 117.28Interest OOOOO 205.15205.15205.15205.15205.15 210.50Depreciation / Amortisation 113.90113.90113.90113.90113.90 115.22

3,520.383,520.383,520.383,520.383,520.38 3,208.04

PROFIT / (LOSS) BEFORE TPROFIT / (LOSS) BEFORE TPROFIT / (LOSS) BEFORE TPROFIT / (LOSS) BEFORE TPROFIT / (LOSS) BEFORE TAXAXAXAXAX 121.84121.84121.84121.84121.84 164.55Provision for Current Tax 20.9620.9620.9620.9620.96 18.61Provision for Deferred Tax 40.1540.1540.1540.1540.15 36.51Provision for Fringe Benefit Tax ————— 2.40MAT Credit Entitlement (20.71)(20.71)(20.71)(20.71)(20.71) (18.32)

PROFIT / (LOSS) AFTER TPROFIT / (LOSS) AFTER TPROFIT / (LOSS) AFTER TPROFIT / (LOSS) AFTER TPROFIT / (LOSS) AFTER TAXAXAXAXAX 81.4481.4481.4481.4481.44 125.35Add: Balance brought forward from Last Year 279.90279.90279.90279.90279.90 207.95Add: Transferred from Debenture Redemption Reserve 5.415.415.415.415.41 8.50

AMOUNT AAMOUNT AAMOUNT AAMOUNT AAMOUNT AVVVVVAILABLE FOR APPROPRIAAILABLE FOR APPROPRIAAILABLE FOR APPROPRIAAILABLE FOR APPROPRIAAILABLE FOR APPROPRIATIONTIONTIONTIONTION 366.75366.75366.75366.75366.75 341.80Less:Appropriations :(a) Proposed Dividend 24.2624.2624.2624.2624.26 20.50(b) Tax on Proposed Dividend 4.124.124.124.124.12 3.48(c) Debenture Redemption Reserve 8.758.758.758.758.75 12.92(d) General Reserve 10.0010.0010.0010.0010.00 25.00

47.1347.1347.1347.1347.13 61.90

Balance carried to Balance Sheet 319.62319.62319.62319.62319.62 279.90

Basic EPS …….. Annualised Rs.— before and after Extraordinary Items 2.802.802.802.802.80 4.89

Diluted EPS …….. Annualised Rs.— before and after Extraordinary Items 2.602.602.602.602.60 4.49

The Annexed Notes (Schedule - Q) form an integral part of the Accounts.

}As per our report attached AJIT GULABCHAND Chairman & Managing DirectorFor K.S. AIYAR & CO.Chartered Accountants VINAYAK DESHPANDE Y.H. MALEGAMRegistration No. 100186W President and K.G. TENDULKAR

Chief Operating Officer RAJAS R. DOSHIRAGHUVIR M. AIYAR D.M. POPATPartner PRAVEEN SOOD RAM P. GANDHI DirectorsMembership No. 38128 Group Chief Financial Officer PROF. FRED MOAVENZADEH

SHARAD M. KULKARNIVITHAL P. KULKARNI NIRMAL P. BHOGILAL

Company Secretary ANIL SINGHVI

Mumbai, Dated: 30th April, 2010 Mumbai, Dated: 30th April, 2010

HCC 84TH ANNUAL REPORT 2009-201064

CMYK

Schedules forming part of the Balance Sheet

SCHEDULE - ASCHEDULE - ASCHEDULE - ASCHEDULE - ASCHEDULE - A As at31.03.2009

SHARE CAPITSHARE CAPITSHARE CAPITSHARE CAPITSHARE CAPITALALALALAL Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs.CroreAuthorised CapitalAuthorised CapitalAuthorised CapitalAuthorised CapitalAuthorised Capital

50,000 9.5% Redeemable Cumulative 0.500.500.500.500.50 0.50Second Preference Shares ofRs.100/- each

49,50,00,000 Equity Shares of Re.1/- each 49.5049.5049.5049.5049.50 49.50

Total 50.0050.0050.0050.0050.00 50.00

Issued, Subscribed & Paid-UpIssued, Subscribed & Paid-UpIssued, Subscribed & Paid-UpIssued, Subscribed & Paid-UpIssued, Subscribed & Paid-Up30,32,49,600 Equity Shares of Re.1/- each 30.3230.3230.3230.3230.32 25.62

(Previous year 25,62,49,600Equity Shares of Re. 1/- each)Add : Forfeited Shares 0.010.010.010.010.01 0.01

Total 30.3330.3330.3330.3330.33 25.63

NOTES:NOTES:NOTES:NOTES:NOTES:Out of 30,32,49,600 Equity Shares of Re.1/- each

(a) 12,68,66,250 Equity Shares were issued as fully paid Bonus Sharesby capitalisation of Reserves and Surplus.

(b) 2,90,55,400 Equity Shares were issued to two SEBI RegisteredInstitutional Investors and a Domestic Mutual Fund on a preferentialbasis on 31st March, 2005.

(c) 2,69,54,200 Shares representing 2,69,54,200 Global DepositoryShares were issued on 29th March, 2006 pursuant to GlobalDepository Offering by the Company. Out of the above 2,68,14,054Global Depository Shares (previous year 2,68,14,054) have beenconverted into Indian Equity Shares.

(d) 4,70,00,000 Equity Shares were issued to QIBs by way of QualifiedInstitutional Placement on 4th July, 2009.

SCHEDULE - BSCHEDULE - BSCHEDULE - BSCHEDULE - BSCHEDULE - B As at31.03.2009

RESERRESERRESERRESERRESERVES AND SURPLUSVES AND SURPLUSVES AND SURPLUSVES AND SURPLUSVES AND SURPLUS Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs.Crore(a)(a)(a)(a)(a) Securities Premium Account :Securities Premium Account :Securities Premium Account :Securities Premium Account :Securities Premium Account :

Balance as per last Account 502.24502.24502.24502.24502.24 573.39Add: Additions during the year 475.41475.41475.41475.41475.41 —

977.65977.65977.65977.65977.65 573.39Less: QIP / Bonds issue expenses

(net of Tax) 8.038.038.038.038.03 —Add: Reversal of Provision for Premium 2.412.412.412.412.41 —

on buyback of FCCBs (net of Tax)(refer note 21 of part III ofSchedule Q)

Less: Provision for Premium on 15.2215.2215.2215.2215.22 71.15redemption of FCCBs (net of Tax)

956.81956.81956.81956.81956.81 502.24(b)(b)(b)(b)(b) General Reserve :General Reserve :General Reserve :General Reserve :General Reserve :

Balance as per last Account 154.38154.38154.38154.38154.38 158.81Add: Transferred from Profit and

Loss Account 10.0010.0010.0010.0010.00 25.00

164.38164.38164.38164.38164.38 183.81Less: Transferred to Fixed Assets /

Foreign Currency Monetory ItemTranslation difference account ————— 29.43

164.38164.38164.38164.38164.38 154.38(c)(c)(c)(c)(c) Debenture Redemption Reserve:Debenture Redemption Reserve:Debenture Redemption Reserve:Debenture Redemption Reserve:Debenture Redemption Reserve:

Balance as per last Account 27.4927.4927.4927.4927.49 23.07Add: Transferred from Profit and

Loss Account 8.758.758.758.758.75 12.92

36.2436.2436.2436.2436.24 35.99Less: Transferred to Profit and

Loss Account 5.415.415.415.415.41 8.50

30.8330.8330.8330.8330.83 27.49

(d)(d)(d)(d)(d) Forfeited Debentures AccountForfeited Debentures AccountForfeited Debentures AccountForfeited Debentures AccountForfeited Debentures Account 0.020.020.020.020.02 0.02

(e)(e)(e)(e)(e) Capital Reserve (Forfeiture of Share WCapital Reserve (Forfeiture of Share WCapital Reserve (Forfeiture of Share WCapital Reserve (Forfeiture of Share WCapital Reserve (Forfeiture of Share Warrants)arrants)arrants)arrants)arrants) 15.1915.1915.1915.1915.19 —(refer note 24 of part III of Schedule Q)

(f)(f)(f)(f)(f) Profit and Loss AccountProfit and Loss AccountProfit and Loss AccountProfit and Loss AccountProfit and Loss AccountBalance carried forward 319.62319.62319.62319.62319.62 279.90

Total 1,486.851,486.851,486.851,486.851,486.85 964.03

SCHEDULE - CSCHEDULE - CSCHEDULE - CSCHEDULE - CSCHEDULE - C As at31.03.2009

SECURED LOANSSECURED LOANSSECURED LOANSSECURED LOANSSECURED LOANS Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore(a)(a)(a)(a)(a) Debentures:Debentures:Debentures:Debentures:Debentures:

(i) 10% Non-Convertible “E” Series ————— 5.00(ii) 9% Non-Convertible 33.3333.3333.3333.3333.33 50.00(iii) 9.5% Non-Convertible 50.0050.0050.0050.0050.00 50.00(iv) 11.10% Non-Convertible 100.00100.00100.00100.00100.00 100.00

183.33183.33183.33183.33183.33 205.00(b)(b)(b)(b)(b) From Banks:From Banks:From Banks:From Banks:From Banks:

i)i)i)i)i) Rupee loansRupee loansRupee loansRupee loansRupee loans1) On Cash Credit Account 111.33111.33111.33111.33111.33 12.702) Exim Bank ————— 50.003) State Bank of Travancore 60.0060.0060.0060.0060.00 100.004) Bank of Maharashtra 50.0050.0050.0050.0050.00 50.005) State Bank of India 12.5012.5012.5012.5012.50 70.006) Axis Bank limited 60.0060.0060.0060.0060.00 60.007) IDBI Bank Limited 270.00270.00270.00270.00270.00 270.008) Bank of Baroda 50.0050.0050.0050.0050.00 —9) Standard Chartered Bank 13.7513.7513.7513.7513.75 —

10) Development Bank -of Singapore 13.7013.7013.7013.7013.70 —

641.28641.28641.28641.28641.28 612.70ii)ii)ii)ii)ii) Foreign currency loansForeign currency loansForeign currency loansForeign currency loansForeign currency loans

1) State Bank of Travancore ————— 28.592) Exim Bank ————— 57.113) Standard Chartered Bank 27.1827.1827.1827.1827.18 —4) Development

Bank of Singapore 36.2436.2436.2436.2436.24 —

63.4263.4263.4263.4263.42 85.70Interest accrued & Due ————— 0.70

(c)(c)(c)(c)(c) From OthersFrom OthersFrom OthersFrom OthersFrom Others 75.0075.0075.0075.0075.00 —

Total 963.03963.03963.03963.03963.03 904.10

Notes:Notes:Notes:Notes:Notes:

Privately Placed Non Convertible DebenturesPrivately Placed Non Convertible DebenturesPrivately Placed Non Convertible DebenturesPrivately Placed Non Convertible DebenturesPrivately Placed Non Convertible Debentures

i)i)i)i)i) 10% Non Convertible Debentures “E” Series : 10% Non Convertible Debentures “E” Series : 10% Non Convertible Debentures “E” Series : 10% Non Convertible Debentures “E” Series : 10% Non Convertible Debentures “E” Series : Secured by firstcharge by way of hypothecation of specific movable properties asspecified in second schedule of the trust deed executed on 20thJanuary, 2003 in favour of Axis Bank Ltd., the trustees to thedebenture holders. These debentures having a face value of Rs.100/-each aggregating Rs. 15 crore are to be redeemed in seven halfyearly installments at the end of 48th, 54th, 60th, 66th, 72nd, 78thand 84th month from the date of allotment i.e. 25th October, 2002.These debentures are redeemed on 23rd October, 2009.

ii)ii)ii)ii)ii) 9% Non Convertible Debentures: 9% Non Convertible Debentures: 9% Non Convertible Debentures: 9% Non Convertible Debentures: 9% Non Convertible Debentures: Secured by first charge onCompany’s specific movable properties as specified in secondschedule of the trust deed executed on 17th January, 2007 in favourof UTI Bank Ltd., the trustees to the debenture holders. Thesedebentures having a face value of Rs.10,00,000/- each aggregatingRs.50 crore are to be redeemed in three annual equal installmentscommencing from the end of 3rd, 4th and 5th year from the date offirst disbursement i.e. 7th September,2006. The first installment ofRs.16.67 crore has been paid on the due date i.e. 7th September,2009.

SCHEDULE - BSCHEDULE - BSCHEDULE - BSCHEDULE - BSCHEDULE - B As at31.03.2009

RESERRESERRESERRESERRESERVES AND SURPLUS (Contd.)VES AND SURPLUS (Contd.)VES AND SURPLUS (Contd.)VES AND SURPLUS (Contd.)VES AND SURPLUS (Contd.) Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs.Crore

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SCHEDULE - C (Contd.)SCHEDULE - C (Contd.)SCHEDULE - C (Contd.)SCHEDULE - C (Contd.)SCHEDULE - C (Contd.)SECURED LOANSSECURED LOANSSECURED LOANSSECURED LOANSSECURED LOANS

iii)iii)iii)iii)iii) 9.5% Non Convertible Debentures: 9.5% Non Convertible Debentures: 9.5% Non Convertible Debentures: 9.5% Non Convertible Debentures: 9.5% Non Convertible Debentures: Secured by first charge onCompany’s specific movable properties as specified in secondschedule of the trust deed executed on 17th January, 2007 in favourof UTI Bank Ltd., the trustees to the debenture holders. Thesedebentures having a face value of Rs.10,00,000/- each aggregatingRs.50 crore are to be redeemed by bullet payment at the end of 5thyear from the date of allotment i.e. 20th November,2007.

iv)iv)iv)iv)iv) 11.10% Non Convertible Debentures: 11.10% Non Convertible Debentures: 11.10% Non Convertible Debentures: 11.10% Non Convertible Debentures: 11.10% Non Convertible Debentures: Secured by first charge byway of hypothecation of specific immovable and movable propertiesas specified in first and second schedule of the trust deed executedon 27th August, 2008 in favour of IDBI Trusteeship Services Ltd.(ITSL), the trustees to the debenture holders. These debentureshaving a face value of Rs. 10,00,000/- each aggregating Rs. 100crore are to be redeemed in four equal installments at the end of4th, 5th, 6th and 7th year from the date of allotment ie. 5th August,2008.

The above debentures (i) to (iv) are also secured by way of mortgageof a flat situated at Lok Gaurav Complex, Vikhroli.

Banks:Banks:Banks:Banks:Banks:

1. Cash credit limits are secured against hypothecation of work inprogress, stores, book debts, dues and advances and residualcharge/mortgage on plant & machinery and land and buildings atVillage Tara, District Raigad.

2.2.2.2.2. EXIM Bank TEXIM Bank TEXIM Bank TEXIM Bank TEXIM Bank Term Loan [b(i)(2) & b(ii)(2)]erm Loan [b(i)(2) & b(ii)(2)]erm Loan [b(i)(2) & b(ii)(2)]erm Loan [b(i)(2) & b(ii)(2)]erm Loan [b(i)(2) & b(ii)(2)]

Secured by a first charge on movable fixed assets acquired/to beacquired by the Company as specified in schedule III-A of the loanagreement executed on 22nd March,2007.

3.3.3.3.3. State Bank of TState Bank of TState Bank of TState Bank of TState Bank of Travancore Travancore Travancore Travancore Travancore Term Loan [b(i)(3) & b(ii)(1)]erm Loan [b(i)(3) & b(ii)(1)]erm Loan [b(i)(3) & b(ii)(1)]erm Loan [b(i)(3) & b(ii)(1)]erm Loan [b(i)(3) & b(ii)(1)]

Secured by a first charge by way of hypothecation of a pool ofspecific plant,machinery,tools and accessories acquired / to beacquired by the Company as specified in schedule II of the deed ofhypothecation executed in favour of the Bank on 15th February,2007 and deed of hypothecation executed on 23rd March, 2009 fordisbursement of Rs.75 Crore on 25th March, 2009.

4.4.4.4.4. Bank of MaharashtraBank of MaharashtraBank of MaharashtraBank of MaharashtraBank of Maharashtra

Secured by first charge by way of hypothecation of specific assetsin favour of the Bank as described in the fourth schedule of thedeed of hypothecation executed on 26th December, 2007.

5.5.5.5.5. State Bank of IndiaState Bank of IndiaState Bank of IndiaState Bank of IndiaState Bank of India

Secured by first charge by way of hypothecation of specific fixedassets in favour of the Bank as described in the annexure II to theagreement of loan executed on 30th November, 2007.

6.6.6.6.6. Axis BankAxis BankAxis BankAxis BankAxis Bank

Secured by first charge by way of hypothecation of specific movablefixed assets as specified in the schedule annexed to the loanagreement executed on 29th September, 2008.

7.7.7.7.7. IDBI BankIDBI BankIDBI BankIDBI BankIDBI Bank

Secured by way of a) Second charge on all the movable assets ofthe Company as on March 31, 2008 and b) First charge on one Flatlocated at “Greater Kailash – II” New Delhi – 110048.

8.8.8.8.8. Bank of BarodaBank of BarodaBank of BarodaBank of BarodaBank of Baroda

Secured by first charge by way of hypothecation of specific movableproperties as described in the second schedule of the compositehypothecation agreement of loan, executed on 18th May, 2009.

9.9.9.9.9. Standard Chartered Bank [b(i)(9) & b(ii)(3)]Standard Chartered Bank [b(i)(9) & b(ii)(3)]Standard Chartered Bank [b(i)(9) & b(ii)(3)]Standard Chartered Bank [b(i)(9) & b(ii)(3)]Standard Chartered Bank [b(i)(9) & b(ii)(3)]

Secured by first charge by way of hypothecation of fixed movableassets acquired under the facility as described in the first scheduleto the memorandum of hypothecation executed on 10th November,2009.

10.10.10.10.10. Development Bank of Singapore [b(i)(10) & b(ii)(4)]Development Bank of Singapore [b(i)(10) & b(ii)(4)]Development Bank of Singapore [b(i)(10) & b(ii)(4)]Development Bank of Singapore [b(i)(10) & b(ii)(4)]Development Bank of Singapore [b(i)(10) & b(ii)(4)]

Secured by first charge by way of hypothecation of specific movableassets based on the terms of the deed of hypothecation to beexecuted. The creation of security is under process.

Others:Others:Others:Others:Others:1.1.1.1.1. SREI Equipment Finance Private LimitedSREI Equipment Finance Private LimitedSREI Equipment Finance Private LimitedSREI Equipment Finance Private LimitedSREI Equipment Finance Private Limited

Secured by first charge by way of hypothecation of specific movableassets as described in the annexure to schedule VIII of the loanagreement executed on 3rd February, 2010 (for disbursement ofRs.25 Crore) and on 2nd March, 2010 (for disbursement of Rs.50Crore).

SCHEDULE - DSCHEDULE - DSCHEDULE - DSCHEDULE - DSCHEDULE - D As at31.03.2009

UNSECURED LOANSUNSECURED LOANSUNSECURED LOANSUNSECURED LOANSUNSECURED LOANS Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

A :A :A :A :A : Short TShort TShort TShort TShort Term Loans and Advanceserm Loans and Advanceserm Loans and Advanceserm Loans and Advanceserm Loans and Advances

i)i)i)i)i) From BanksFrom BanksFrom BanksFrom BanksFrom Banks(a) Commercial Paper (Maximum

balance outstanding during 360.00360.00360.00360.00360.00 130.00the year Rs.450 Crore(previous year Rs.165 Crore)

(b) Term LoansRupee Loan 185.00185.00185.00185.00185.00 330.00Interest accrued & Due on above ————— 0.28

ii)ii)ii)ii)ii) From OthersFrom OthersFrom OthersFrom OthersFrom Others(a) Intercorporate Deposits 15.0615.0615.0615.0615.06 —(b) NBFC ————— 50.00

B :B :B :B :B : Other Loans & AdvancesOther Loans & AdvancesOther Loans & AdvancesOther Loans & AdvancesOther Loans & Advances

i)i)i)i)i) From BanksFrom BanksFrom BanksFrom BanksFrom Banks

(a) Rupee Loan* 544.99544.99544.99544.99544.99 254.99

(b) Foreign Currency Loan* 11.3311.3311.3311.3311.33 152.40

* (Repayable within one yearRs.186.33 crore,as at 31st March, 2009Rs.164.49 crore)

ii)ii)ii)ii)ii) From OthersFrom OthersFrom OthersFrom OthersFrom Others

(a) Zero Coupon Convertible

Foreign Currency Bonds due2011 435.29435.29435.29435.29435.29 500.03(refer note 19 of part IIIof Schedule Q)

Total 1,551.671,551.671,551.671,551.671,551.67 1,417.70

HCC 84TH ANNUAL REPORT 2009-201066

CMYK

SCHEDULE - ESCHEDULE - ESCHEDULE - ESCHEDULE - ESCHEDULE - E

FIXED ASSETSFIXED ASSETSFIXED ASSETSFIXED ASSETSFIXED ASSETS (Rs. Crore)

GROSS BLOCKGROSS BLOCKGROSS BLOCKGROSS BLOCKGROSS BLOCK DEPRECIADEPRECIADEPRECIADEPRECIADEPRECIATION/AMORTION/AMORTION/AMORTION/AMORTION/AMORTISATISATISATISATISATIONTIONTIONTIONTION NET BLOCKNET BLOCKNET BLOCKNET BLOCKNET BLOCK

ASSETSASSETSASSETSASSETSASSETS As at Additions Deductions As atAs atAs atAs atAs at As at For the Deductions UptoUptoUptoUptoUpto As atAs atAs atAs atAs at As at01.04.09 31.03.31.03.31.03.31.03.31.03.1010101010 01.04.09 year 31.03.31.03.31.03.31.03.31.03.1010101010 31.03.31.03.31.03.31.03.31.03.1010101010 31.03.09

At Cost:Freehold Land 9.09 — — 9.099.099.099.099.09 — — — — 9.099.099.099.099.09 9.09

At Book ValueBuildings & Sheds 43.44 — 3.97 39.4739.4739.4739.4739.47 16.02 1.75 1.65 16.1216.1216.1216.1216.12 23.3523.3523.3523.3523.35 27.42

Plant & Machinery 1,354.81 124.56 113.97 1,365.401,365.401,365.401,365.401,365.40 452.49 90.26 4.58 538.17538.17538.17538.17538.17 827.23827.23827.23827.23827.23 902.32

Heavy Vehicles 142.89 15.44 4.28 154.05154.05154.05154.05154.05 37.50 15.79 1.00 52.2952.2952.2952.2952.29 101.76101.76101.76101.76101.76 105.40

Light Vehicles 29.93 7.36 4.03 33.2633.2633.2633.2633.26 10.02 2.81 1.72 11.1111.1111.1111.1111.11 22.1522.1522.1522.1522.15 19.91

Helicopter/ Aircraft 49.48 147.04 39.23 157.29157.29157.29157.29157.29 5.23 5.96 3.99 7.207.207.207.207.20 150.09150.09150.09150.09150.09 44.25

Speed Boat 0.51 — 0.02 0.490.490.490.490.49 0.13 0.02 — 0.150.150.150.150.15 0.340.340.340.340.34 0.38

Furniture and Office 18.16 0.39 0.10 18.4518.4518.4518.4518.45 10.74 1.15 — 11.8911.8911.8911.8911.89 6.566.566.566.566.56 7.42Equipments

Computers 19.41 1.67 0.45 20.6320.6320.6320.6320.63 16.11 1.93 — 18.0418.0418.0418.0418.04 2.592.592.592.592.59 3.30

Intangible Assets 15.10 0.94 — 16.0416.0416.0416.0416.04 6.41 3.11 — 9.529.529.529.529.52 6.526.526.526.526.52 8.69(ERP software)

TTTTTotal of this yearotal of this yearotal of this yearotal of this yearotal of this year 1,682.831,682.831,682.831,682.831,682.83 297.40297.40297.40297.40297.40 166.05166.05166.05166.05166.05 1,814.181,814.181,814.181,814.181,814.18 554.65554.65554.65554.65554.65 122.78122.78122.78122.78122.78 12.9412.9412.9412.9412.94 664.49664.49664.49664.49664.49 1,149.691,149.691,149.691,149.691,149.69 —————

Less Transferred to ProjectWork in Progress 8.888.888.888.888.88

Depreciation as per profitand loss account 113.90113.90113.90113.90113.90

Total of previous year 1,409.73 313.53 40.43 1,682.83 456.63 129.11 31.09 554.65 1,128.18

Less Transferred to ProjectWork in Progress inprevious year 13.89

Depreciation as per profitand loss account inprevious year 115.22

Items Awaiting Completionor Commissioning 34.8534.8534.8534.8534.85 46.44

Total 1,184.541,184.541,184.541,184.541,184.54 1,174.62

Note :- Deductions in gross block includes decapitalisation of foreign exchange and CENVAT credit availed.

HCC 84TH ANNUAL REPORT 2009-201067

CMYK

SCHEDULE - FSCHEDULE - FSCHEDULE - FSCHEDULE - FSCHEDULE - F As at 31.03.2009CostCostCostCostCost CostCostCostCostCost Cost Cost

UnquotedUnquotedUnquotedUnquotedUnquoted QuotedQuotedQuotedQuotedQuoted Unquoted QuotedINVESTMENTSINVESTMENTSINVESTMENTSINVESTMENTSINVESTMENTS Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore Rs. CroreLong TLong TLong TLong TLong Term Investmentserm Investmentserm Investmentserm Investmentserm Investments(a)(a)(a)(a)(a) Investment in SubsidiaryInvestment in SubsidiaryInvestment in SubsidiaryInvestment in SubsidiaryInvestment in Subsidiary

Companies in India :Companies in India :Companies in India :Companies in India :Companies in India :(i) Hincon Technoconsult Ltd. 1.001.001.001.001.00 1.00

10,00,000 Equity Shares ofRs.10/- each fully paid

(ii) Western Securities Ltd. 5.385.385.385.385.38 5.3819,57,500 Equity Shares ofRs.10/- each fully paid

(iii) Pune Paud Toll RoadCompany Ltd. 5.445.445.445.445.44 5.4454,44,500 Equity Sharesof Rs.10/- each fully paid(refer note 33 of part IIIof Schedule Q)

(iv) HCC Real Estate Ltd. 304.47304.47304.47304.47304.47 304.474,41,28,790 Equity Sharesof Rs.10/- each fully paid

(v) Nirmal BOT Ltd. 31.5031.5031.5031.5031.50 31.503,15,00,000 Equity Sharesof Rs.10/- each fully paid

(vi) HCC Infrastructure Ltd. 0.050.050.050.050.05 0.0550,000 Equity Shares ofRs.10/- each fully paid

(vii) Lavasa Corporation Ltd. 0.010.010.010.010.01 0.01134 Equity Shares ofRs.10/- each fully paid

(viii) Panchkutir Developers Ltd. 0.100.100.100.100.10 0.101,00,000 Equity Shares ofRs.10/- each fully paid

(ix) HCC Aviation Ltd. 0.050.050.050.050.05 0.0550,000 Equity Shares ofRs.10/- each fully paid

(x) Badarpur FaridabadTollways Ltd. 43.8643.8643.8643.8643.86 0.054,38,60,000 Equity Sharesof Rs.10/- eachfully paid (4,38,10,000Equity Shares ofRs.10/- each purchasedduring the year)

(xi) HCC Construction Ltd. 0.050.050.050.050.05 —50,000 Equity Shares ofRs.10/- eachfully paid (purchasedduring the year)

(xii) Highbar Technologies Ltd. 0.050.050.050.050.05 —50,000 Equity Shares ofRs.10/- each fully paid(purchased during the year)

(xiii) Rajganj Dalkhola HighwaysLtd. 50,000 Equity Sharesof Rs.10/- each fully paid(purchased during the year) 0.030.030.030.030.03 —

(xiv) Baharampore FarakkaHighways Ltd. 50,000 EquityShares of Rs.10/- each fullypaid (purchased during theyear) 0.030.030.030.030.03 —

(xv) Farakka Rajganj HighwaysLtd. 50,000 Equity Sharesof Rs.10/- each fully paid(purchased during the year) 0.030.030.030.030.03 —

(b)(b)(b)(b)(b) Investment in SubsidiaryInvestment in SubsidiaryInvestment in SubsidiaryInvestment in SubsidiaryInvestment in SubsidiaryCompanies outside India :Companies outside India :Companies outside India :Companies outside India :Companies outside India :(i) HCC Mauritius Enterprises Ltd. 0.020.020.020.020.02 0.02

5,000 Shares of USD 1 eachfully paid

(ii) HCC Singapore EnterprisesPTE Ltd. 0.020.020.020.020.02 0.025,000 Shares ofUSD 1 each fully paid

(c)(c)(c)(c)(c) Investment in the capitalInvestment in the capitalInvestment in the capitalInvestment in the capitalInvestment in the capitalof Partnership Firmof Partnership Firmof Partnership Firmof Partnership Firmof Partnership Firm

Vikhroli Corporate Park 4.344.344.344.344.34 4.34(refer note 23 of part IIIof Schedule Q)

SCHEDULE - F As at 31.03.2009Cost Cost Cost Cost

Unquoted Quoted Unquoted QuotedINVESTMENTS Rs. Crore Rs. Crore Rs. Crore Rs. Crore

(d)(d)(d)(d)(d) Other Investments:Other Investments:Other Investments:Other Investments:Other Investments:(i) Walchand Co-op.

Housing Society Ltd. 0.00*0.00*0.00*0.00*0.00* 0.00*5 Equity Shares ofRs.50/- each fully paid

(ii) Shushrusha Citizens 0.00*0.00*0.00*0.00*0.00* 0.00*Co-Op. Hospital Ltd. -100 Equity Shares ofRs. 100/- each fully paid

(iii) Housing DevelopmentFinance Corporation Ltd. 0.00*0.00*0.00*0.00*0.00* 0.043,044 (Previous year25,044 Equity Shares ofRs.10/- each fully paid)

(iv) HDFC Bank Ltd. 0.00*0.00*0.00*0.00*0.00* 0.00*500 Equity Shares ofRs.10/- each fully paid

(v) Hindustan Oil ExplorationCo.Ltd. ————— 0.91NIL (Previous year 78,061Equity Shares of Rs.10/- eachfully paid)(78,061 Equity Shares soldduring the year)

(vi) Khandwala Securities Ltd. 0.00*0.00*0.00*0.00*0.00* 0.00*3,332 Equity Shares ofRs.10/- each fully paid

(vii) Hincon Finance Ltd. 0.120.120.120.120.12 0.121,20,000 Equity Shares ofRs.10/- each fully paid

(viii) Jyoti Ltd. 12.0012.0012.0012.0012.00 12.0012,00,000 Equity Shares ofRs.10/- each fully paid

(ix) Dhule Palesner Tollway Ltd. 0.130.130.130.130.13 —1,30,000 Equity Shares ofRs.10/- each fullypaid (Purchased duringthe year)

Total 396.68396.68396.68396.68396.68 12.0112.0112.0112.0112.01 352.55 12.95

408.69408.69408.69408.69408.69 365.50

As at 31.03.2009CostCostCostCostCost MarketMarketMarketMarketMarket Cost Market

VVVVValuealuealuealuealue ValueRs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore Rs. Crore

Notes :Notes :Notes :Notes :Notes :1.1.1.1.1. Aggregate of Investments :Aggregate of Investments :Aggregate of Investments :Aggregate of Investments :Aggregate of Investments :

(i) Quoted Investments 12.0112.0112.0112.0112.01 7.837.837.837.837.83 12.95 7.30(ii) Unquoted Investments 396.68396.68396.68396.68396.68 352.55

Total 408.69408.69408.69408.69408.69 365.50

Note :- * represents amount less than Rs. 100000.Mutual Funds Received / Purchased and Sold during the yearMutual Funds Received / Purchased and Sold during the yearMutual Funds Received / Purchased and Sold during the yearMutual Funds Received / Purchased and Sold during the yearMutual Funds Received / Purchased and Sold during the year

Name of the SecurityName of the SecurityName of the SecurityName of the SecurityName of the Security Face VFace VFace VFace VFace Valuealuealuealuealue No. of UnitsNo. of UnitsNo. of UnitsNo. of UnitsNo. of Units Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crorei) Kotak Liquid Institutional

Premium - Daily Dividend Rs.10/- each. 8,177,885.36 10.00Reinvest Plan

ii) Birla Sunlife Cash Plus-Institutional Premium Rs.10/- each. 19,961,075.90 20.00- Daily Dividend Reinvest Plan

iii) Birla Sunlife Saving Fund-Institutional Rs.10/- each. 19,988,272.34 20.00- Daily Dividend Reinvest Plan

iv) ICICI Pru. Institutional LiquidPlan-Super Institutional Rs.10/- each. 39,991,201.94 40.00- Daily Dividend Reinvest Plan

v) HDFC Liquid Fund PremiumPlan Institutional Rs.10/- each. 24,470,219.74 30.00- Daily Dividend Reinvest Plan

vi) UTI Liquid Fund Cash PlanInstitutional Rs.10/- each. 196,185.04 20.00- Daily Income OptionReinvestment Plan

vii) Kotak Flexi Debt SchemeInstitutional Rs.10/- each. 19,907,492.06 20.00- Daily Dividend Reinvest Plan

HCC 84TH ANNUAL REPORT 2009-201068

CMYK

SCHEDULE - GSCHEDULE - GSCHEDULE - GSCHEDULE - GSCHEDULE - G As at31.03.2009

CURRENT ASSETSCURRENT ASSETSCURRENT ASSETSCURRENT ASSETSCURRENT ASSETS Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

InventoriesInventoriesInventoriesInventoriesInventories

(As technically valued and Certifiedby the Management)

(a) Stores,Spares and Embedded Goods, at Cost 259.94259.94259.94259.94259.94 292.02

(b) Fuel, at Cost 13.6313.6313.6313.6313.63 12.24

(c) Materials in transit, at Cost 1.611.611.611.611.61 0.54

(d) Work in Progress

Uncompleted Contracts and value ofWork Done 3,379.573,379.573,379.573,379.573,379.57 2,768.27

Less:

(i) Advances Received/Other Recoveries 304.24304.24304.24304.24304.24 426.45

(ii) Related Site Mobilisation Expenses 88.2488.2488.2488.2488.24 148.78

2,987.092,987.092,987.092,987.092,987.09 2,193.04

Add: Retention Money 302.95302.95302.95302.95302.95 278.80

3,290.043,290.043,290.043,290.043,290.04 2,471.84

Total 3,565.223,565.223,565.223,565.223,565.22 2,776.64

Sundry DebtorsSundry DebtorsSundry DebtorsSundry DebtorsSundry Debtors

Unsecured, Considered Good :

(a) Outstanding over six months ————— —

(b) Others 2.652.652.652.652.65 4.71

Total 2.652.652.652.652.65 4.71

Cash and Bank BalancesCash and Bank BalancesCash and Bank BalancesCash and Bank BalancesCash and Bank Balances

(a) Cash on Hand 1.331.331.331.331.33 1.56

(b) Cheques on Hand 37.8637.8637.8637.8637.86 25.04

(c) With Scheduled Banks

(i) Current Accounts in Indian Rupees 95.8495.8495.8495.8495.84 100.45

(ii) Current Accounts in Foreign Currency 41.2541.2541.2541.2541.25 18.08

(iii) Deposit Accounts in Indian Rupees 12.0412.0412.0412.0412.04 8.74

Total 188.32188.32188.32188.32188.32 153.87

Other Current AssetsOther Current AssetsOther Current AssetsOther Current AssetsOther Current AssetsInterest Accrued on others 4.794.794.794.794.79 3.81

Total 4.794.794.794.794.79 3.81

Grand Total 3,760.983,760.983,760.983,760.983,760.98 2,939.03

SCHEDULE - HSCHEDULE - HSCHEDULE - HSCHEDULE - HSCHEDULE - HLOANS AND ADVLOANS AND ADVLOANS AND ADVLOANS AND ADVLOANS AND ADVANCESANCESANCESANCESANCESUnsecured, Considered GoodUnsecured, Considered GoodUnsecured, Considered GoodUnsecured, Considered GoodUnsecured, Considered Good

(a) Advances Recoverable in Cash or in Kindor for Value to be received 232.50232.50232.50232.50232.50 183.28

(b) Advance Payment of Taxes net of provision 108.70108.70108.70108.70108.70 71.33Advance Tax Rs.187.07 crore(Previous year Rs.130.48 crore) includingMAT credit entitlement Rs.40.30 Crore(Previous Year - Rs.19.39 Crore),Provision for Tax Rs.78.37 crore(Previous year Rs.59.15 Crore)

(c) Earnest Money, Security and Other Deposits 22.1022.1022.1022.1022.10 17.71

(d) Loans & advances to Subsidiary companies(refer note 25 of part III of Schedule Q) 452.34452.34452.34452.34452.34 192.02

SCHEDULE - H (Contd.)SCHEDULE - H (Contd.)SCHEDULE - H (Contd.)SCHEDULE - H (Contd.)SCHEDULE - H (Contd.) As at31.03.2009

LOANS AND ADVLOANS AND ADVLOANS AND ADVLOANS AND ADVLOANS AND ADVANCESANCESANCESANCESANCES Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

Unsecured, Considered GoodUnsecured, Considered GoodUnsecured, Considered GoodUnsecured, Considered GoodUnsecured, Considered Good

(e) Loans & advances / deposits toPartnership firm 20.2220.2220.2220.2220.22 0.67

(f) Foreign Currency Monetory ItemTranslation difference account 2.172.172.172.172.17 19.33

(g) Integrated Joint Ventures (net)

(i) HCC L & T Purulia Joint Venture 1.891.891.891.891.89 3.00

(ii) Nathpa Jhakri Joint Venture 8.048.048.048.048.04 29.22

(iii) KSHI Joint Venture 0.530.530.530.530.53 1.40

(iv) Alpine Samsung HCC Joint Venture ————— 2.68

(v) Alpine HCC Joint Venture 8.388.388.388.388.38 7.71

(vi) Dhule Palesner Tollway Ltd. 6.396.396.396.396.39 —

Total 863.26863.26863.26863.26863.26 528.35

SCHEDULE - ISCHEDULE - ISCHEDULE - ISCHEDULE - ISCHEDULE - ICURRENT LIABILITIES AND PROVISIONSCURRENT LIABILITIES AND PROVISIONSCURRENT LIABILITIES AND PROVISIONSCURRENT LIABILITIES AND PROVISIONSCURRENT LIABILITIES AND PROVISIONS

Current LiabilitiesCurrent LiabilitiesCurrent LiabilitiesCurrent LiabilitiesCurrent Liabilities

(a) Sundry Creditors(refer note 13 of part III of Schedule Q) 1,186.791,186.791,186.791,186.791,186.79 1,032.10

(b) Due to Subsidiary companies ————— 5.23

(c) Advances from Contractees 736.28736.28736.28736.28736.28 502.91Less: Related Site Mobilisation

Expenses 88.2488.2488.2488.2488.24 148.78

648.04648.04648.04648.04648.04 354.13

(d) Interest Accrued but not due on Loans 11.8111.8111.8111.8111.81 7.62

(e) Integrated Joint Ventures (net)

(i) HCC Pati Joint Venture 2.712.712.712.712.71 2.71

(ii) Alpine Samsung HCC Joint Venture 1.741.741.741.741.74 —

(f) Investor Education & Protection Fundshall be Credited by the followingamounts when due:

(i) Unclaimed Dividend 0.910.910.910.910.91 0.78

(ii) Unclaimed Debentures(including interest) ————— 0.03

Total 1,852.001,852.001,852.001,852.001,852.00 1402.60

Provisions:Provisions:Provisions:Provisions:Provisions:

(a) Proposed Dividend 24.2624.2624.2624.2624.26 20.50

(b) Tax on Proposed Dividend 4.124.124.124.124.12 3.48

(c) Provision for Premium on redemptionof FCCBs 127.14127.14127.14127.14127.14 107.78(refer note 19 of part III of Schedule Q)

(d) Provision for Leave Encashment 12.0212.0212.0212.0212.02 11.64

(e) Provision for Gratuity 21.8721.8721.8721.8721.87 20.19

(f) Provision for Sick leave 1.541.541.541.541.54 1.49

Total 190.95190.95190.95190.95190.95 165.08

Grand Total 2,042.952,042.952,042.952,042.952,042.95 1,567.68

HCC 84TH ANNUAL REPORT 2009-201069

CMYK

Schedules forming part of the Profit and Loss Account

SCHEDULE - JSCHEDULE - JSCHEDULE - JSCHEDULE - JSCHEDULE - J PreviousYear

INCOME FROM OPERAINCOME FROM OPERAINCOME FROM OPERAINCOME FROM OPERAINCOME FROM OPERATIONSTIONSTIONSTIONSTIONS Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreValue of Work Donei) Contract Revenue

(refer note 30 of part III of Schedule Q) 3,642.183,642.183,642.183,642.183,642.18 3,304.94ii) Service Income from Joint Ventures 2.022.022.022.022.02 8.76

Total 3,644.203,644.203,644.203,644.203,644.20 3,313.70Add: Company’s Share of Turnover in

Integrated Joint Ventures 218.77218.77218.77218.77218.77 204.62(refer note 12 of part III of Schedule Q)

Grand Total 3,862.973,862.973,862.973,862.973,862.97 3,518.32

SCHEDULE - KSCHEDULE - KSCHEDULE - KSCHEDULE - KSCHEDULE - KOTHER INCOMEOTHER INCOMEOTHER INCOMEOTHER INCOMEOTHER INCOME(a) Dividend on Other Investments 0.240.240.240.240.24 0.56(b) Miscellaneous Receipts 7.437.437.437.437.43 7.12(c) Profit on Sale of Assets ————— 61.63(d) Profit on Sale of Investments (Net) 6.696.696.696.696.69 1.69(e) Earlier Years’ Provisions No Longer Required ————— 0.08(f) Exchange Loss ( Net ) (1.35)(1.35)(1.35)(1.35)(1.35) (12.25)

Total 13.0113.0113.0113.0113.01 58.83

SCHEDULE - LSCHEDULE - LSCHEDULE - LSCHEDULE - LSCHEDULE - LCONSTRUCTION EXPENSESCONSTRUCTION EXPENSESCONSTRUCTION EXPENSESCONSTRUCTION EXPENSESCONSTRUCTION EXPENSES(a) Stores and Embedded Goods consumed

Stock at Commencement 292.02292.02292.02292.02292.02 336.48Add: Purchases 1,054.371,054.371,054.371,054.371,054.37 1,210.89

1,346.391,346.391,346.391,346.391,346.39 1,547.37Less: Scrap and Unserviceables

Sold 26.4926.4926.4926.4926.49 18.95

1,319.901,319.901,319.901,319.901,319.90 1,528.42Less: Stock at Close 259.94259.94259.94259.94259.94 292.02

1,059.961,059.961,059.961,059.961,059.96 1,236.40(b) Sub-Contract, Transportation, Hire etc. 1,348.721,348.721,348.721,348.721,348.72 888.75

[refer note 3(a) & 3(b) of part III of Schedule Q](c) Power and Fuel 200.51200.51200.51200.51200.51 227.67(d) Repairs to Machinery 7.047.047.047.047.04 14.48(e) Other Repairs 2.022.022.022.022.02 1.65(f) Rent 14.4814.4814.4814.4814.48 12.85(g) Water Charges 14.9514.9514.9514.9514.95 8.34

Total 2,647.682,647.682,647.682,647.682,647.68 2,390.14

SCHEDULE - MSCHEDULE - MSCHEDULE - MSCHEDULE - MSCHEDULE - MEMPLOYEES’ REMUNERAEMPLOYEES’ REMUNERAEMPLOYEES’ REMUNERAEMPLOYEES’ REMUNERAEMPLOYEES’ REMUNERATION AND BENEFITSTION AND BENEFITSTION AND BENEFITSTION AND BENEFITSTION AND BENEFITS(a) Salaries,Wages,Bonus and Gratuity 348.65348.65348.65348.65348.65 332.34(b) Contribution to Provident Fund 18.6118.6118.6118.6118.61 17.72

and Other Funds(c) Welfare Expenses 27.0927.0927.0927.0927.09 24.84

Total 394.35394.35394.35394.35394.35 374.90

SCHEDULE - NSCHEDULE - NSCHEDULE - NSCHEDULE - NSCHEDULE - NOFFICE AND SITE ESTOFFICE AND SITE ESTOFFICE AND SITE ESTOFFICE AND SITE ESTOFFICE AND SITE ESTABLISHMENT EXPENSESABLISHMENT EXPENSESABLISHMENT EXPENSESABLISHMENT EXPENSESABLISHMENT EXPENSES(a) Stationery, Postage, Telephone & Advertisement 17.5617.5617.5617.5617.56 11.52(b) Travelling and Conveyance 24.0624.0624.0624.0624.06 21.08(c) Rent 7.197.197.197.197.19 0.90(d) Rates and Taxes 2.092.092.092.092.09 1.06(e) Insurance 2.922.922.922.922.92 3.23(f) Professional Charges 36.2136.2136.2136.2136.21 25.86(g) Repairs and Maintenance 10.3310.3310.3310.3310.33 10.40(h) Directors’ Fees 0.210.210.210.210.21 0.14(i) Auditors’ Remuneration:

(i) Audit Fees 0.450.450.450.450.45 0.40(ii) Tax Audit Fees 0.110.110.110.110.11 0.11(iii) For Reviews and Certification

Work 0.400.400.400.400.40 0.29(iv) Reimbursement of Out of

Pocket Expenses 0.060.060.060.060.06 0.05

1.021.021.021.021.02 0.85

(j) Guarantee, Commission and Charges 10.3210.3210.3210.3210.32 11.17

(k) Finance Charges 3.683.683.683.683.68 8.22

(l) Miscellaneous Expenses 13.6813.6813.6813.6813.68 11.34

(m) Computer Maintenance & DevelopmentExpenses 5.385.385.385.385.38 5.43

(n) Donations 3.213.213.213.213.21 5.13

(o) Donations to Political parties(refer note 32 of part III of Schedule Q) 5.005.005.005.005.00 —

(p) Provision for Doubtful Advances. 0.090.090.090.090.09 —

(q) Loss on Sale of Assets (net) 16.2516.2516.2516.2516.25 —

(r) Expenses relating to prior years ————— 0.04

(s) Share of Loss in Partnership firm 0.100.100.100.100.10 0.91

Total 159.30159.30159.30159.30159.30 117.28

SCHEDULE - OSCHEDULE - OSCHEDULE - OSCHEDULE - OSCHEDULE - OINTERESTINTERESTINTERESTINTERESTINTEREST(a) On Debentures 20.4720.4720.4720.4720.47 19.79(b) On Other Accounts 206.47206.47206.47206.47206.47 205.83

226.94226.94226.94226.94226.94 225.62Less: Interest Capitalised 0.790.790.790.790.79 1.27

226.15226.15226.15226.15226.15 224.35

Less: Interest Earned (Gross)

(a) Fixed deposits with Foreign Banks 0.050.050.050.050.05 0.41

(b) Others 20.9520.9520.9520.9520.95 13.44(Tax Deducted at SourceRs.2.77 Crore Previous YearRs.1.47 crore)

21.0021.0021.0021.0021.00 13.85

Total 205.15205.15205.15205.15205.15 210.50

SCHEDULE - PSCHEDULE - PSCHEDULE - PSCHEDULE - PSCHEDULE - PStatement of Computation of Net ProfitStatement of Computation of Net ProfitStatement of Computation of Net ProfitStatement of Computation of Net ProfitStatement of Computation of Net ProfitUnder Section 198 (read with Section 349)Under Section 198 (read with Section 349)Under Section 198 (read with Section 349)Under Section 198 (read with Section 349)Under Section 198 (read with Section 349)of the Companies Act, 1956, for the purpose ofof the Companies Act, 1956, for the purpose ofof the Companies Act, 1956, for the purpose ofof the Companies Act, 1956, for the purpose ofof the Companies Act, 1956, for the purpose ofManagerial Remuneration for the year endedManagerial Remuneration for the year endedManagerial Remuneration for the year endedManagerial Remuneration for the year endedManagerial Remuneration for the year ended31st March, 201031st March, 201031st March, 201031st March, 201031st March, 2010

PreviousYear

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

Profit Before Tax as per Profit and Loss Account 121.84121.84121.84121.84121.84 164.55

Add: (a) Depreciation Charged as per Profit andLoss Account 113.90113.90113.90113.90113.90 115.22

(b) Managerial Remuneration andDirectors’ Fees 10.4110.4110.4110.4110.41 8.64

(c) Loss on Sale of Fixed Assets as per 21.5321.5321.5321.5321.53 2.80Profit & Loss Account

(d) Profit on Sale of Assets as per Section 2.052.052.052.052.05 2.20349 of the Companies Act,1956

269.73269.73269.73269.73269.73 293.41

Less: (a) Depreciation as per Section 350 of theCompanies Act, 1956 113.90113.90113.90113.90113.90 115.22

(b) Loss on Sale of Assets as per Section349 of the Companies Act,1956 21.5321.5321.5321.5321.53 2.80

(c) Profit on Sale of Fixed Assets as per 5.285.285.285.285.28 64.43Profit & Loss Account

(d) Profit on Sale of Investments 6.696.696.696.696.69 1.69

Net Profit as per Section 198 (read withSection 349) of the Companies Act, 1956 122.39122.39122.39122.39122.39 109.27

Maximum amount of Remuneration Permissible 12.2312.2312.2312.2312.23 10.93to Wholetime Directors (@10% of Net Profit)

Commission to Wholetime Directors ————— —

Maximum amount of Commission Permissibleto Non-Executive Directors (@1% of Net Profit) 1.221.221.221.221.22 1.09

Commission to Non-Executive Directors 0.500.500.500.500.50 0.48

SCHEDULE - N (Contd.)SCHEDULE - N (Contd.)SCHEDULE - N (Contd.)SCHEDULE - N (Contd.)SCHEDULE - N (Contd.) PreviousOFFICE AND SITEOFFICE AND SITEOFFICE AND SITEOFFICE AND SITEOFFICE AND SITE YearESTESTESTESTESTABLISHMENT EXPENSESABLISHMENT EXPENSESABLISHMENT EXPENSESABLISHMENT EXPENSESABLISHMENT EXPENSES Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

HCC 84TH ANNUAL REPORT 2009-201070

CMYK

SCHEDULE - QSCHEDULE - QSCHEDULE - QSCHEDULE - QSCHEDULE - Q

SIGNIFICANT ACCOUNTING POLICIES AND NOTES FORMING PSIGNIFICANT ACCOUNTING POLICIES AND NOTES FORMING PSIGNIFICANT ACCOUNTING POLICIES AND NOTES FORMING PSIGNIFICANT ACCOUNTING POLICIES AND NOTES FORMING PSIGNIFICANT ACCOUNTING POLICIES AND NOTES FORMING PARARARARARTTTTTOF THE ACCOUNTS AS AOF THE ACCOUNTS AS AOF THE ACCOUNTS AS AOF THE ACCOUNTS AS AOF THE ACCOUNTS AS AT 31ST MARCH, 2010T 31ST MARCH, 2010T 31ST MARCH, 2010T 31ST MARCH, 2010T 31ST MARCH, 2010

I.I.I.I.I. Significant Accounting PoliciesSignificant Accounting PoliciesSignificant Accounting PoliciesSignificant Accounting PoliciesSignificant Accounting Policies

1.1.1.1.1. Basis of AccountingBasis of AccountingBasis of AccountingBasis of AccountingBasis of Accounting

The Company maintains its accounts on accrual basis.Management makes estimates and technical and otherassumptions regarding the amounts of income and expensesin accordance with GAAP in the preparation of the financialstatements. Difference between the actual results andestimates are recognised in the period in which they aredetermined.

2.2.2.2.2. Fixed AssetsFixed AssetsFixed AssetsFixed AssetsFixed Assets

Fixed assets are stated at cost of acquisition includingattributable interest & financial costs till the date of acquisition/installation of the assets and improvement thereon lessaccumulated depreciation / amortisation.

Intangible assets comprise of licence fees, otherimplementation cost for software (ERP) and other applicationsoftwares acquired for inhouse use.

3.3.3.3.3. DepreciationDepreciationDepreciationDepreciationDepreciation

Depreciation on fixed assets is provided:

i) In respect of buildings and sheds, furniture and officeequipments on the written down value method (pro-rataon additions and deletions of the year) at rates prescribedin Schedule XIV of the Companies Act, 1956.

ii) In respect of plant & machinery, heavy vehicles, lightvehicles, helicopter, aircraft and speed boat on the straightline method at rates prescribed in schedule XIV of theCompanies Act, 1956 on a pro-rata basis.

iii) In respect of computers depreciation is provided onstraight line basis over a period of three years on a pro-rata basis.

iv) The depreciation on assets used for construction has beentreated as period cost.

v) Software and implementation costs including userslicence fees of the Enterprise Resourse Planning (ERP)system and other application software costs areamortised over a period of 5 years.

4.4.4.4.4. InvestmentsInvestmentsInvestmentsInvestmentsInvestments

Investments are classified as long-term and currentinvestments. Long-term investments are shown at cost orwritten down value (in case of other than temporarydiminution) and current investments are shown at cost ormarket value whichever is lower.

5.5.5.5.5. Employee BenefitsEmployee BenefitsEmployee BenefitsEmployee BenefitsEmployee Benefits

i) Defined Contribution plan

Contribution to provident fund and superannuation fundis accounted on accrual basis.

ii) Defined Benefit plan

Gratuity is charged to revenue on the basis of actuarialvaluation and in case of daily rated workmen on actualbasis computed on tenure of service as at the end of theyear.

iii) Other Benefits

Short term and long term compensated absenses areprovided for based on actuarial valuation.

The actuarial valuation is done as per projected unit creditmethod.

The obligation is measured at the present value of theestimated future cash flows. The discount rates used fordetermining the present value of the obligation under

defined benefit plans, is based on market yields onGovernment securities as at the Balance Sheet date,having maturity periods approximating to the terms ofthe related obligations.

6.6.6.6.6. InventoriesInventoriesInventoriesInventoriesInventories

a) The stock of stores, spares and embedded goods andfuel is valued at cost (weighted average basis), or netrealisable value whichever is lower.

b) Work-in-Progress is valued at the contract rates and sitemobilisation expenditure of incomplete contracts is statedat cost.

c) Certain loose plant, tools & service equipments costingbelow Rs. 5 lacs are valued at proportionate written downvalue @ 3% p.m. over a period of 32 months.

d) Site mobilisation expenses are presented as a deductionfrom advances from contractees to the extent funded bysuch advances.

7.7.7.7.7. Provisions, Contingent Liabilities and Contingent AssetsProvisions, Contingent Liabilities and Contingent AssetsProvisions, Contingent Liabilities and Contingent AssetsProvisions, Contingent Liabilities and Contingent AssetsProvisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation inmeasurement are recognised when there is a present obligationas a result of past events and it is probable that there will bean outflow of resourses. Contingent liabilities are notrecognised but are disclosed in the notes. Contingent assetsare neither recognised nor disclosed in the financial statements.

8.8.8.8.8. Borrowing CostsBorrowing CostsBorrowing CostsBorrowing CostsBorrowing Costs

Borrowing costs that are attributable to the acquisition,construction or production of a qualifying asset are capitalised.Other borrowings costs are expensed out.

9.9.9.9.9. Foreign Exchange TForeign Exchange TForeign Exchange TForeign Exchange TForeign Exchange Translation of Foreign Projects andranslation of Foreign Projects andranslation of Foreign Projects andranslation of Foreign Projects andranslation of Foreign Projects andAccounting of Foreign Exchange TAccounting of Foreign Exchange TAccounting of Foreign Exchange TAccounting of Foreign Exchange TAccounting of Foreign Exchange Transactionsransactionsransactionsransactionsransactions

a) Current assets and current liabilities are translated at theexchange rate prevailing on the last day of the year.

b) Gains or losses arising out of remittance / translations atthe year-end are credited / debited to the profit and lossaccount for the year except in cases where they relate toacquisition of Fixed assets, in which case they areadjusted to the carrying cost of such assets.

c) Foreign exchange transactions are converted into Indianrupees at the prevailing rate on the date of thetransaction.

d) Exchange differences arising on contracts are recognisedin the period in which they arise and the premium paid /received is accounted as expense / income over the periodof the contract.

10.10.10.10.10. Financial Derivatives & Hedging TFinancial Derivatives & Hedging TFinancial Derivatives & Hedging TFinancial Derivatives & Hedging TFinancial Derivatives & Hedging Transactionsransactionsransactionsransactionsransactions

Financial derivatives and hedging contracts are accounted onthe date of their settlement and realised gain/ loss in respectof settled contracts is recognised in the profit & loss accountalong with the underlying transactions.

11.11.11.11.11. Accounting of Construction ContractsAccounting of Construction ContractsAccounting of Construction ContractsAccounting of Construction ContractsAccounting of Construction Contracts

The Company follows the percentage completion method,based on the stage of completion at the balance sheet date,taking into account the contractual price and revision theretoby estimating total revenue and total cost till completion ofthe contract and the profit so determined has been accountedfor proportionate to the percentage of the actual work done.

Revenue is recognized as follows:

a) In case of Item rate contracts on the basis of physicalmeasurement of work actually completed at the balancesheet date.

b) In case of lumpsum contracts, revenue is recognized onthe completion of milestones as specified in the contractor as identified by the management.

HCC 84TH ANNUAL REPORT 2009-201071

CMYK

Foreseeable losses are accounted for as and when they aredetermined except to the extent they are expected to berecovered through claims presented or to be presented to thecustomer or in arbitration.

Claims are accounted as income in the year of receipt ofarbitration award or acceptance by client or evidence ofacceptance received.

12.12.12.12.12. Accounting for Joint VAccounting for Joint VAccounting for Joint VAccounting for Joint VAccounting for Joint Venture Contractsenture Contractsenture Contractsenture Contractsenture Contracts

(a) Contracts executed in Joint Venture under work sharingarrangement (consortium) are accounted in accordancewith the accounting policy followed by the Company asthat of an independent contract to the extent work isexecuted.

(b) In respect of contracts executed in Integrated JointVentures under profit sharing arrangement (assessed asAOP under Income tax laws), the services rendered tothe Joint Ventures are accounted as income on accrualbasis. The profit / loss is accounted for, as and when it isdetermined by the Joint Venture and the net investmentin the Joint Venture is reflected as investments, loans &advances or current liabilities.

13.13.13.13.13. TTTTTaxationaxationaxationaxationaxation

The tax expense comprises of current tax & deferred taxcharged or credited to the profit and loss account for the year.Current tax is calculated in accordance with the tax lawsapplicable to the current financial year. The deferred tax chargeor credit is recognised using the tax rates and tax laws thathave been enacted by the balance sheet date. Where there areunabsorbed depreciation or carry forward losses, deferred taxassets are recognised only if there is virtual certainty ofrealisation of such assets. Other deferred tax assets arerecognised only to the extent there is reasonable certainty ofrealisation in future. At each balance sheet date, recognisedand unrecognised deferred tax assets are reviewed.

14.14.14.14.14. LeasesLeasesLeasesLeasesLeases

Lease rentals in respect of assets aquired under operatinglease are charged to Profit and Loss account.

15.15.15.15.15. Impairment of AssetsImpairment of AssetsImpairment of AssetsImpairment of AssetsImpairment of Assets

The Company makes an assessment of any indicator that maylead to impairment of assets on an annual basis.

An asset is treated as an impaired when the carrying cost ofthe asset exceeds its recoverable value, which is higher of netselling price and value in use. Any impairment loss is chargedto profit and loss account in the year in which it is identifiedas impaired.

16.16.16.16.16. Employees Stock Option PlanEmployees Stock Option PlanEmployees Stock Option PlanEmployees Stock Option PlanEmployees Stock Option Plan

In respect of the stock options granted pursuant to theCompany’s stock option scheme, market value of theCompany’s shares as on the grant date was equal to the parvalue for the options granted, hence no accounting entries asper ESOP guidelines are required to be made.

II.II.II.II.II. Contingent LiabilitiesContingent LiabilitiesContingent LiabilitiesContingent LiabilitiesContingent Liabilities As atAs atAs atAs atAs at As at31.03.201031.03.201031.03.201031.03.201031.03.2010 31.03.2009

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

(i) Counter Indemnities given to :Banks, in respect of contracts

(a) For works in India(Secured on all the assets) 1,619.531,619.531,619.531,619.531,619.53 1,741.86

(b) *For works abroad (secured byECGC counter guarantees) 202.93202.93202.93202.93202.93 32.30

*(Converted in rupees at the ratefixed by the Bank)

(ii) Claims not acknowledged as debtsby the Company. 2.692.692.692.692.69 0.40

(iii) Sales Tax liability / Works ContractTax liability that may arise in respectof matters in appeal 14.2614.2614.2614.2614.26 7.56(Net of an amount of Rs.0.53 Crore(previous year Rs.12.06 crore))recoverable from Clients as per theterms of contract )

(iv) Bills discounted with banks 165.98165.98165.98165.98165.98 241.39

(v) Corporate Guarantees:

The Company has provided anundertaking to pay in the event ofdefault on loan given by a bank tosubsidiary,Joint Ventures.

a) Pune Paud Toll Road CompanyLimited 14.3614.3614.3614.3614.36 18.48

b) Lavasa Corporation Limited 555.44555.44555.44555.44555.44 185.43

c) HCC Real Estate Limited 423.93423.93423.93423.93423.93 410.00

d) Nirmal BOT Limited 6.186.186.186.186.18 26.78

e) Charosa Wineries Limited 22.0022.0022.0022.0022.00 17.00

vi) A client has encashed Performance Bank Guarantee amountingto Rs. 27.40 Crore in the year 2007-08 which is disputed by theCompany. The Company has been legally advised that it has agood case on merits and therefore has invoked arbitrationprovisions of the contract. During the year issues to be decidedby the Arbitral Tribunal have been framed by the Tribunal.Pending resolution of the dispute the encashed Bank Guranteeis considered as a current asset.

III. Notes :III. Notes :III. Notes :III. Notes :III. Notes :

1. Advances from contractees of Rs.736.28 Crore (previous yearRs.502.90 Crore) have been guaranteed by Company’s bankers tothe extent of Rs.692.85 Crore (previous year Rs.473.42 Crore).

2 Commitment for capital expenditure is Rs.74.28 Crore (previousyear Rs. 130.09 Crore).

3. (a) Sub-contract, transportation, hire etc. include insuranceRs.31.05 Crore ( previous year Rs. 24.87 Crore), rates and taxesRs.130.06 Crore (previous year Rs. 127.20 Crore ) and leaserent Rs.7.02 Crore (previous year Rs.6.83 Crore ).

(b) Light vehicle expenses grouped under construction expensesinclude insurance Rs.2.15 Crore (previous year Rs.0.86 Crore)and taxes Rs.0.10 Crore (previous year Rs. 0.11 Crore). Noallocation is made to it for petrol and maintenance at the sites.

4. Loans and Advances include an amount due from an Officer of theCompany Rs.0.09 Crore (previous year Rs.0.12 Crore). Maximumamount outstanding during the year Rs.0.12 Crore (previous yearRs.0.14 Crore).

2009-102009-102009-102009-102009-10 2008-095. Managerial Remuneration : Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

(i) Salary 4.094.094.094.094.09 3.52

(ii) Commission to Chairman & ManagingDirector & whole time Directors ————— —

(iii) Commission to Non-executive Directors 0.500.500.500.500.50 0.48

(iv) Contribution to Provident and other Funds 2.062.062.062.062.06 0.95

(v) Perquisites 3.573.573.573.573.57 3.55

Total 10.2210.2210.2210.2210.22 8.50

Note:The above figure does not include provision for gratuity liabilityactuarially valued as separate figures are not available.

SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.) SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)As atAs atAs atAs atAs at As at

31.03.201031.03.201031.03.201031.03.201031.03.2010 31.03.2009Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

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6. I) The Company has taken various construction equipments andvehicles under non cancelable operating leases.

The future minimum lease payments in respect of these as at31st March, 2010 are as follows.

Rs.Crore

As atAs atAs atAs atAs at As at31.03.201031.03.201031.03.201031.03.201031.03.2010 31.03.2009

Minimum Lease Rental payments

i) Payable Not Later than one year 7.56 8.90

ii) Payable Later than one year butnot later than five years 1.47 9.03

Total 9.039.039.039.039.03 17.93

II) The lease agreement provides for an option to the Companyto renew the lease period at the end of the non cancelableperiod.There are no exceptional/restrictive covenants in thelease agreements.

7. The Income-tax assessments of the Company have been completedupto the accounting year ended 31st March, 2006. Several appealspreferred by the Company are pending before appellate authorities.

Deferred Tax liability for the year ended 31st March, 2010 has beenprovided on the estimated tax computation for the year.

Major components of deferred tax assets and liabilities arising onaccount of timing differences are:

2009-102009-102009-102009-102009-10 2008-09AssetsAssetsAssetsAssetsAssets LiabilitiesLiabilitiesLiabilitiesLiabilitiesLiabilities Assets Liabilities

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore Rs. Crore

a) Depreciation 104.71104.71104.71104.71104.71 69.28

b) Claims/ArbitrationAwards 90.5390.5390.5390.5390.53 79.92

c) Others 9.429.429.429.429.42 0.60

d) FCCBs premium 43.1843.1843.1843.1843.18 36.63

Total 52.6052.6052.6052.6052.60 195.24195.24195.24195.24195.24 36.63 149.80

8. Disclosure in relation to the Derivative instruments

For hedging Foreign Currencyrisk for unsecured loans: Number of contracts Rs. Crore

i) Options 6 94.40(3) (66.95)

ii) Forward Contracts NIL NIL(NIL) (NIL)

(Note: Figures in bracket pertain to previous year).

Foreign Currency exposure not hedged as on 31st March, 2010 isRs.563.93 Crore (previous year Rs. 971.91 Crore).

9. The Company has a single segment namely “Engineering &Construction”. Therefore, the Company’s business does not fallunder different business segments as defined by AS 17- “SegmentalReporting” issued by ICAI.

10. Disclosure in accordance with Accounting Standard - 7 (Revised)-Amount due from / to customers on Construction Contracts.

2009-102009-102009-102009-102009-10 2008-09Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

Contract Revenue 10,717.8710,717.8710,717.8710,717.8710,717.87 8,413.10

Contract Costs incurred 9,515.609,515.609,515.609,515.609,515.60 7,392.98

Recognised Profits / Losses 1,202.271,202.271,202.271,202.271,202.27 1,020.12

Advances received 582.95582.95582.95582.95582.95 496.12

Retention Money 208.33208.33208.33208.33208.33 173.30

Gross amount due from Customer forContract Work 1,551.431,551.431,551.431,551.431,551.43 1,368.65

Gross amount due to Customer forContract Work 290.88290.88290.88290.88290.88 415.20

Note :- The above information is given only in respect of contractsentered into on or after 01.04.03.

11. (a) Contracts executed by the following Joint Ventures areaccounted for as per accounting policy No. 12 (a).i) HCC-Van Oord Joint Venture ix) HCC-MEIL - CBE Joint Ventureii) Samsung-HCC Joint Venture x) HCC-MEIL - BHEL Joint Ventureiii) L & T-HCC Joint Venture xi) HCC-MEIL - SEW- AAG Joint Ventureiv) HCC-KBL Joint Venture xii) HCC-MEIL - SEW Joint Venturev) HCC-NCC Joint Venture xiii) HCC-Halcrow Joint Venturevi) HCC-CEC Joint Venture xiv) HCC-Laing-Sadbhavvii) HCC-NOVA Joint Venture xv) HCC-MEIL- NCC- WPIL Joint Ventureviii) HCC-CPPL Joint Venture xvi) MEIL-IVRCL- HCC - WPIL Joint Venture

(b) Contracts executed by the following Joint Ventures areaccounted for as per accounting policy No. 12 (b).

Name of the Name of the Method of Share ofVenture Venture/s Accounting Interest

Partner/s

HCC-L&T Purulia Larsen & Toubro Ltd. Percentage 57%completion

HCC-Pati Pati Sendirian, Berhad Percentage 50%completion

Nathpa Jhakri Impregilio Spa, Italy Completed 40%Contract

Kumagai-Skanska Skanska, Kumagai Completed 19.60%HCC-Itochu Group Itochu Contract

Alpine - Samsung Alpine Meyreder Bau, Percentage 33%- HCC Samsung Corporation completion

Alpine - HCC Alpine Meyreder Bau Percentage 49%completion

Dhule Palesner HCC Infrastructure Ltd., Percentage 26%Tollway Ltd. John Laing Investment Ltd., completion

John Laing InvestmentsMauritius (No 1) Ltd.,Sadbhav Engineering Ltd.,Sadbhav InfrastructureProjects Ltd.

In respect of Joint Ventures the Company alongwith other JVmembers is jointly & severally responsible for performance of thecontracts.

12. Financial Interest in Jointly Controlled Entities.Rs. Crore

Name ofName ofName ofName ofName of HCC’HCC’HCC’HCC’HCC’s Share ofs Share ofs Share ofs Share ofs Share ofthe Jointthe Jointthe Jointthe Jointthe Joint AssetsAssetsAssetsAssetsAssets LiabilitiesLiabilitiesLiabilitiesLiabilitiesLiabilities TTTTTurnoverurnoverurnoverurnoverurnover OtherOtherOtherOtherOther ExpensesExpensesExpensesExpensesExpensesVVVVVentureentureentureentureenture IncomeIncomeIncomeIncomeIncome

As atAs atAs atAs atAs at For the year endedFor the year endedFor the year endedFor the year endedFor the year ended31st March, 201031st March, 201031st March, 201031st March, 201031st March, 2010 31st March, 201031st March, 201031st March, 201031st March, 201031st March, 2010

HCC-L&T Purulia 5.805.805.805.805.80 1.771.771.771.771.77 ————— 0.070.070.070.070.07 0.040.040.040.040.04Joint Venture (5.91) (1.87) (0.02) (0.06) (0.24)

HCC-Pati Joint 3.533.533.533.533.53 5.225.225.225.225.22 ————— ————— 0.00*0.00*0.00*0.00*0.00*Venture (3.53) (5.22) — (0.11) 0.00 *

Nathpa Jhakri 9.429.429.429.429.42 9.429.429.429.429.42 6.006.006.006.006.00 ————— 18.1318.1318.1318.1318.13Joint Venture (31.26) (14.96) (1.43) — (1.41)

Kumagai-Skanska 1.111.111.111.111.11 3.733.733.733.733.73 ————— ————— 0.120.120.120.120.12HCC-Itochu Group (1.67) (4.17) — — (-0.13)

Alpine-Samsung- 43.6843.6843.6843.6843.68 47.0247.0247.0247.0247.02 118.10118.10118.10118.10118.10 0.310.310.310.310.31 121.27121.27121.27121.27121.27HCC Joint (117.65) (118.12) (142.73) — (143.20)Venture

Alpine-HCC 26.7426.7426.7426.7426.74 26.2326.2326.2326.2326.23 94.6794.6794.6794.6794.67 0.380.380.380.380.38 94.9694.9694.9694.9694.96Joint Venture (39.40) (38.96) (60.44) — (60.00)

Dhule Palesner 48.6448.6448.6448.6448.64 48.6448.6448.6448.6448.64 ————— ————— —————Tollway Ltd. (—) (—) (—) (—) (—)

Total 138.92138.92138.92138.92138.92 142.03142.03142.03142.03142.03 218.77218.77218.77218.77218.77 0.760.760.760.760.76 234.52234.52234.52234.52234.52(199.42) (183.30) (204.62) (0.17) (204.72)

(Note: Figures in bracket pertain to previous year ).

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HCC 84TH ANNUAL REPORT 2009-201073

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13. The Company has amounts due to suppliers under the Micro, Smalland Medium Enterprises Development Act 2006, as at 31st March,2010. The disclosure pursuant to the said Act is as under:

Principal amount due to suppliers under MSMED Act 0.03

Interest accrued and due to suppliers under MSMEDAct on the above amount —*

Payment made to suppliers (other than interest) beyondappointed day during the year 2.04

Interest paid to suppliers under MSMED Act —

Interest due and payable to suppliers under MSMEDAct towards payments already made 0.04

Interest accrued and remaining unpaid at the end of theaccounting year 0.04

Note : This information as required to be disclosed under the Micro,Small and Medium Enterprises Development Act, 2006 has beendetermined to the extent such parties have been identified on thebasis of information available with the Company.

14. In accordance with Accounting Standard 11 (Revised) the netexchange loss debited to profit & loss account is Rs.1.35 Crore(previous year Rs.12.26 Crore).

The Companies (Accounting Standards) Amendment Rules 2009has amended the provisions of AS-11 relating to “The Effects of thechanges in Foreign Exchange Rates” vide notification dated 31stMarch, 2009. In terms of these amendments, the Company hascarried over long term monetory exchange loss of Rs. 2.17 Crorethrough “Foreign Currency Monetory Items Translation DifferenceAccount” (previous year Rs.19.33 Crore), to be amortised over thebalance period of such long term asset/ liability but not beyond31st March 2011. Further foreign exchange difference (net) ofRs.62.89 Crore (Previous year Rs.99.64 Crore) on capital accounthas been taken to the cost of respective fixed assets.

15. During the year, Company claimed Cenvat Credit of Rs.49.84 Croreon capital and non-capital goods from 2004-05 to 2006-07 in termsof Circular dated 01.10.2007. As a result the gross block of fixedassets is reduced by Rs.48.25 Crore, accumulated depreciation isreduced by Rs.9.99 Crore with corresponding effect on inventoryexcept for an amount of Rs.2.63 Crore relating to closed projectscredited to the Profit and Loss Account.

16. Value of assets taken on lease NIL (previous year NIL). Futureobligation on account of lease rentals Rs.9.03 Crore (previous yearRs. 17.93 Crore).

17. Intangible assets (ERP) includes compatible software Rs.0.94 Crore(previous year Rs.3.15 Crore).

18. Additional information pursuant to the provisions of part II ofSchedule VI to the Companies Act, 1956 (wherever applicable).

Rs. Crore

2009-102009-102009-102009-102009-10 2008-09

A. Value of Imports calculated on CIF Basis :

(i) Components, embedded goodsand spare-parts 65.2665.2665.2665.2665.26 96.23

(ii) Capital goods 180.39180.39180.39180.39180.39 90.89

B. Expenditure in foreign currencies :

(i) Travelling expenses 0.950.950.950.950.95 0.51

(ii) Other expenses 23.2623.2623.2623.2623.26 22.46

C. Value of imported and indigenouscomponents, embedded goodsand spare parts consumed:

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore % Rs. Crore %

(i) Imported into India 21.7721.7721.7721.7721.77 2.052.052.052.052.05 40.16 3.25

(ii) Indigenous, to thesite 1,038.191,038.191,038.191,038.191,038.19 97.9597.9597.9597.9597.95 1,196.24 96.75

1,059.961,059.961,059.961,059.961,059.96 100.00100.00100.00100.00100.00 1,236.40 100.00

Rs. Crore

D. Earnings in foreign currencies 2009-102009-102009-102009-102009-10 2008-09(on accrual basis)

Export of goods or services on 78.5478.5478.5478.5478.54 70.73F.O.B. basis and work bills realisedon contracts

19. The Company issued at par 1,000 Zero Coupon Convertible Bondsdue 2011 of US$1,00,000 each and 2,69,54,200 Global DepositoryShares (GDSs) for an issue price of US $ 3.71 each aggregating toUS $ 200 million. (INR 891.60 Crore as on the date of issue) in theyear 2005-06 to finance capital expenditure, acquisitions, investmentin Company’s real estate subsidiary and any other use as may bepermitted under applicable law or by relevant regulatory bodiesfrom time to time . The Bondholders have an option of convertingthese Bonds into shares at an initial conversion price of Rs. 248.08per share with a fixed rate of conversion of Rs.44.58 = US$1 at anytime on or after 11th May, 2006 up to 18th February, 2011. TheBonds are also redeemable at the option of the Company at least at130% of the early redemption amount at any time on or after 14thApril, 2009 upto 18th February, 2011. Unless previously redeemed ,converted or purchased and cancelled , the Bonds will be redeemedon 1st April, 2011 at 137.7139 % of their principal amount.

The Offering Circular provides for an adjustment to the conversionprice of the FCCBs in the event the Company making a fresh issueof its equity shares for a consideration that is less than the CurrentMarket Value of the equity shares as on the date on which theCompany fixes the consideration.

Pursuant to the issuance of fresh equity shares to QIBs, the Companyhas revised the conversion price of the FCCBs from Rs. 248.08 toRs. 246.02.

Premium payable on redemption of FCCBs till 31st March, 2010 hasbeen adjusted net of tax in the Securities Premium Account.

20. In the year 2005-06 pending utilization of the issue proceeds ofZero Coupon Foreign currency convertible bonds (FCCB) and GlobalDepositary Shares (GDS) an amount of Rs.869.54 Crore had beenkept in Foreign Currency Current and Deposit Accounts. During thecurrent year out of issue proceeds, Rs.NIL (previous year Rs.14.42Crore) has been utilized for meeting working capital requirementsin terms of the objects of the issue.

21. During the year ended 31st March, 2010, 34 FCCBs of the face valueof USD 100,000 each were bought back by the Company aggregatingto USD 0.34 crore.

Further, provision made for premium on redemption of FCCBs bydebiting Securities Premium in the previous year has been reversedto the extent it pertains to the FCCBs buyback.

22. The Company vide its Qualified Institutional Placement Documentdated 30th June, 2009 has placed 4,70,00,000 fully paid equity sharesof Re 1/- each at an issue price of Rs 102.15 per equity share(including a premium of Rs 101.15 per equity share), aggregatingto Rs 480.11 Crore to Qualified Institutional Buyers. These equityshares have been subsequently issued and alloted at its Boardmeeting held on 4th July, 2009.

23. Investment in the capital of Partnership Firm - Vikhroli CorporatePark

As atAs atAs atAs atAs at As at31.03.201031.03.201031.03.201031.03.201031.03.2010 31.03.2009

Rs. Crore

Partners Share in firm Capital Contribution

(i) HCC Real EstateLimited 80% 54.0854.0854.0854.0854.08 54.08

(ii) Hindustan ConstructionCompany Limited 20% 4.344.344.344.344.34 4.34

24. The Company issued 75,00,000 Warrants of Re.1/- each at a premiumof Rs. 202.50 per warrant on preferential basis to promoters on20th December, 2007. The Warrant holders were entitled to apply

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HCC 84TH ANNUAL REPORT 2009-201074

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for and be allotted, in one or more tranches, one equity share ofRe. 1/- each of the Company per warrant, anytime after the date ofallotment of Warrant but before the expiry of 18 months from thedate of allotment of such Warrants. Upon exercise of the right toapply for equity shares, the Warrant holders were liable to makethe payment of 90% of the issue price. The Board upon receipt ofthe entire amount was to allot one equity share per Warrant.

However, upon not exercising the option, an amount of Rs.15.19Crore equivalent to 10% of the issue price of 75,00,000 warrantsreceived during the previous year have been forfeited.

25. Disclosure as per Clause 32 of the Listing agreement and as perSchedule VI of the Companies Act, 1956.

Loans and advances given to Subsidiaries.Loans and advances given to Subsidiaries.Loans and advances given to Subsidiaries.Loans and advances given to Subsidiaries.Loans and advances given to Subsidiaries. Rs. Crore

Outstanding Maximum balance Balance during the period

As atAs atAs atAs atAs at As at As atAs atAs atAs atAs at As at31.03.1031.03.1031.03.1031.03.1031.03.10 31.03.09 31.03.1031.03.1031.03.1031.03.1031.03.10 31.03.09

i) HCC Real Estate Ltd. (HREL) Subsidiary 121.51121.51121.51121.51121.51 0.63 128.67128.67128.67128.67128.67 57.48

ii) Pune Paud Toll RoadCompany Ltd. Subsidiary 22.7422.7422.7422.7422.74 13.90 22.7422.7422.7422.7422.74 13.90

iii) Nirmal BOT Ltd. Subsidiary 33.1933.1933.1933.1933.19 31.50 41.1841.1841.1841.1841.18 40.94

iv) Lavasa Corporation Ltd. Subsidiary of 20.4120.4120.4120.4120.41 8.29 20.9720.9720.9720.9720.97 12.07HREL

v) HCC Mauritius Enterprise Ltd. Subsidiary 0.060.060.060.060.06 0.03 0.060.060.060.060.06 0.03

vi) HCC Singapore EnterprisePTE Ltd. Subsidiary 0.060.060.060.060.06 0.04 0.060.060.060.060.06 0.04

vii) HCC Infrastructure Ltd. Subsidiary 136.63136.63136.63136.63136.63 7.74 136.63136.63136.63136.63136.63 7.61

viii) Panchkutir Developers Ltd. Subsidiary 91.5291.5291.5291.5291.52 81.01 91.5291.5291.5291.5291.52 81.01

ix) HCC Aviation Ltd. Subsidiary 10.6710.6710.6710.6710.67 4.31 14.0714.0714.0714.0714.07 5.80

x) Badarpur FaridabadTollway Ltd. Subsidiary 15.3615.3615.3615.3615.36 44.57 54.6554.6554.6554.6554.65 44.57

xi) Charosa Wineries Ltd. Subsidiary ————— — ————— 4.00

xii) HCC Construction Ltd. Subsidiary 0.050.050.050.050.05 — 0.050.050.050.050.05 —

xiii) Highbar Technologies Ltd. Subsidiary 0.140.140.140.140.14 — 0.140.140.140.140.14 —

Total 452.34452.34452.34452.34452.34 192.02 510.74510.74510.74510.74510.74 267.45

Note:- i) Loans and advances include interest free loan to NirmalBOT Ltd. of Rs.31.50 crore where there is no repaymentschedule and is repayable on demand.

ii) Inter Corporate Deposits are repayable on demand andinterest is charged at market rates.

26. Disclosure relating to Employee Benefits - As per Revised AS - 15

Rs.Crore

2009-10 2008-09Non Funded Non Funded

Gratuity Leave Gratuity LeaveA.A.A.A.A. Expenses recognised in theExpenses recognised in theExpenses recognised in theExpenses recognised in theExpenses recognised in the Encash- Encash-

statement of Profit & Lossstatement of Profit & Lossstatement of Profit & Lossstatement of Profit & Lossstatement of Profit & Loss ment mentAccount for the year endedAccount for the year endedAccount for the year endedAccount for the year endedAccount for the year ended31.03.201031.03.201031.03.201031.03.201031.03.2010

1. Current Service Cost 2.502.502.502.502.50 2.402.402.402.402.40 2.52 2.81

2. Interest Cost 1.501.501.501.501.50 0.860.860.860.860.86 1.09 0.57

3. Expected Return onPlan Assets ————— ————— — —

4. Net Actuarial (Gain) /Loss recognisedduring the year (0.20)(0.20)(0.20)(0.20)(0.20) (0.97)(0.97)(0.97)(0.97)(0.97) 3.67 1.85

5. Settlements cost/ others 0.620.620.620.620.62 0.310.310.310.310.31 0.06 0.42

TTTTTotal Expensesotal Expensesotal Expensesotal Expensesotal Expenses 4.424.424.424.424.42 2.602.602.602.602.60 7.34 5.65

SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.) SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)

2009-10 2008-09Non Funded Non Funded

Gratuity Leave Gratuity LeaveEncash- Encash-

ment ment

B.B.B.B.B. Net Asset / (Liability)Net Asset / (Liability)Net Asset / (Liability)Net Asset / (Liability)Net Asset / (Liability)recognised in therecognised in therecognised in therecognised in therecognised in theBalance SheetBalance SheetBalance SheetBalance SheetBalance Sheet

1. Present value of theobligation. 21.41 11.75 19.95 11.42

2. Fair value of Plan Assets — — — —

3. Funded Status(surplus / deficit) — — — —

Net Asset / (Liability)Net Asset / (Liability)Net Asset / (Liability)Net Asset / (Liability)Net Asset / (Liability)recognised in therecognised in therecognised in therecognised in therecognised in theBalance SheetBalance SheetBalance SheetBalance SheetBalance Sheet 21.4121.4121.4121.4121.41 11.7511.7511.7511.7511.75 19.95 11.42

4. Add: a) Provision forseparatedemployees/ Others 0.46 0.13 0.24 0.07

b) Provision atoverseas branch — 0.14 — 0.15

TTTTTotal provisionotal provisionotal provisionotal provisionotal provision(refer schedule ‘I’)(refer schedule ‘I’)(refer schedule ‘I’)(refer schedule ‘I’)(refer schedule ‘I’) 21.8721.8721.8721.8721.87 12.0212.0212.0212.0212.02 20.19 11.64

C.C.C.C.C. Change in Present value of obligationChange in Present value of obligationChange in Present value of obligationChange in Present value of obligationChange in Present value of obligation

1. Present value of obligationas on 1st April, 2009 19.95 11.42 14.58 7.62

2. Current Service Cost 2.50 2.40 2.52 2.81

3. Interest Cost 1.50 0.86 1.09 0.57

4. Benefits paid (2.34) (1.95) (1.91) (1.43)

5. Net Actuarial (Gain) / Lossrecognised during the year (0.20) (0.98) 3.67 1.85

Present value of obligationPresent value of obligationPresent value of obligationPresent value of obligationPresent value of obligation 21.4121.4121.4121.4121.41 11.7511.7511.7511.7511.75 19.95 11.42as per actuarial valuationas per actuarial valuationas per actuarial valuationas per actuarial valuationas per actuarial valuationas at 31st March, 2010as at 31st March, 2010as at 31st March, 2010as at 31st March, 2010as at 31st March, 2010

6. Add: a) Provision forseparatedemployees/others 0.46 0.13 0.24 0.07

b) Provision atoverseas branch — 0.14 — 0.15

TTTTTotal Provisionotal Provisionotal Provisionotal Provisionotal Provision(refer schedule ‘I’)(refer schedule ‘I’)(refer schedule ‘I’)(refer schedule ‘I’)(refer schedule ‘I’) 21.8721.8721.8721.8721.87 12.0212.0212.0212.0212.02 20.19 11.64

D.D.D.D.D. Actuarial assumptions:Actuarial assumptions:Actuarial assumptions:Actuarial assumptions:Actuarial assumptions:

i. Discount Rate 8.00% p.a. 7.50% p.a.

ii. Salary Escalation -over a long term 7.50% p.a. 7.00% p.a.

iii. Mortality rate LIC (1994-96) LIC (1994-96)ultimate ultimate

iv. Average future 20 years. 10 years.working lifetime

v. The attrition rate varies from 2% to 8% (previous year 2%to 8%) for various age groups.

E.E.E.E.E. Accumulated compensated absences (non vesting)Accumulated compensated absences (non vesting)Accumulated compensated absences (non vesting)Accumulated compensated absences (non vesting)Accumulated compensated absences (non vesting)

Actuarial valuation of sick leave has been made on 31.03.2010.Provision in respect of this benefit amounts to Rs.1.54 crore forthe financial year ending 31.03.2010 (previous year Rs.1.49 Crore).

HCC 84TH ANNUAL REPORT 2009-201075

CMYK

SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)

27. Disclosure in accordance with Accounting Standard -18 Related PartyTransactions

A. Names of Related Parties & Nature of Relationshipa)a)a)a)a) Subsidiaries & its Subsidiaries:Subsidiaries & its Subsidiaries:Subsidiaries & its Subsidiaries:Subsidiaries & its Subsidiaries:Subsidiaries & its Subsidiaries:

1) Hincon Technoconsult Ltd.2) Western Securities Ltd.3) Pune Paud Toll Road Company Ltd.4) HCC Real Estate Ltd.5) HCC Singapore Enterprises Pte Ltd.6) HCC Mauritius Enterprises Ltd.7) Nirmal BOT Ltd.8) HCC Aviation Ltd.9) Badarpur Faridabad Tollways Ltd.10) HCC Infrastructure Ltd.11) HCC Construction Ltd.12) Panchkutir Developers Ltd.13) Highbar Technologies Ltd.14) Baharampore-Farakka Highways Ltd.15) Farakka-Raiganj Highways Ltd.16) Raiganj-Dalkhola Highways Ltd.17) HREL Township Developers Ltd.18) HREL (Thane) Real Estate Ltd.19) Maan Township Developers Ltd.

(Previously Hinjewadi Township Ltd.)20) Nashik Township Developers Ltd.21) Charosa Wineries Ltd.22) Powai Real Estate Developers Ltd.23) Lavasa Corporation Ltd.24) HCC Realty Ltd.25) Lavasa Hotels Ltd.26) Warasgaon Lake View Hotels Ltd.

(Previously Lavasa Star Hotel Ltd.)27) Appolo Lavasa Health Corporation Ltd.28) Ecomotel Hotels Ltd.29) Dasve Business Hotels Ltd.30) Dasve Convention Centre Ltd.31) Lakeshore Watersport Company Ltd.32) Lakeview Clubs Ltd.33) Dasve Hospitality Institutes Ltd.34) Dasve Retails Ltd.35) Spotless Laundry Services Ltd.36) SOL Hospitality Ltd. *37) Lavasa Bamboocraft Ltd.38) Green Hill Residences Ltd.39) Knowledge Vista Ltd.

(Previously GDXT Oxford International School Ltd.)40) Full Spectrum Adventure Ltd.41) Space Theme Park India Ltd. **42) My City Technology Ltd.43) Reasonable Housing Ltd.44) Minfur Interior Technologies Ltd.45) Verzon Hospitality Ltd.46) Rhapsody Hospitality Ltd.47) Sirrah Palace Hotels Ltd.48) Andromeda Hotels Limited (100%)49) Valley View Entertainment Ltd.50) Whistling Thrush Facilities Services Ltd.51) Warasgaon Power Supply Ltd.52) Sahyadri City Management Ltd.53) Warasgaon Tourism Ltd.

* - Ceased to be subsidiary from May’09** - Ceased to be subsidiary from April’09

b)b)b)b)b) Integrated Joint VIntegrated Joint VIntegrated Joint VIntegrated Joint VIntegrated Joint Ventures:entures:entures:entures:entures:

i) Nathpa Jhakri Joint Venture

ii) HCC-Pati Joint Venture

iii) Kumagai-Skanska-HCC-Itochu Group

iv) HCC-L & T Purulia Joint Venture

v) Alpine - Samsung - HCC Joint Venture

vi) Alpine - HCC Joint Venture

vii) Dhule Palesner Tollway Ltd.

c)c)c)c)c) Other Related Parties:Other Related Parties:Other Related Parties:Other Related Parties:Other Related Parties:

1) Hincon Holdings Ltd.

2) Vikhroli Corporate Park

3) Bon Sera Hotels Ltd.

4) Palmetto Hospitality Ltd.

5) Gulabchand Foundation (formed under section 25 ofCompanies’ Act, 1956)

B.B.B.B.B. Key Management PersonnelKey Management PersonnelKey Management PersonnelKey Management PersonnelKey Management Personnel

i) Shri Ajit Gulabchand Chairman & Managing Director

ii) Shri K.G. Tendulkar Director (Deputy ManagingDirector upto 7th November, 2009)

iii) Shri Vinayak Deshpande President & COO (EPC &Construction)

iv) Shri Praveen Sood Group Chief Financial Officer

v) Shri V. P. Kulkarni Company Secretary

C.C.C.C.C. TTTTTransactions with Related Parties:ransactions with Related Parties:ransactions with Related Parties:ransactions with Related Parties:ransactions with Related Parties:

Rs. Crore

Nature of Transactions Subsidiary Integrated Other RelatedCompanies JV’s Parties

Purchase of ConstructionPurchase of ConstructionPurchase of ConstructionPurchase of ConstructionPurchase of Constructionmaterials and Sparesmaterials and Sparesmaterials and Sparesmaterials and Sparesmaterials and SparesAlpine—HCC Joint venture ————— 0.070.070.070.070.07 —————

(—) (—) (—)

Nirmal BOT Ltd. 0.300.300.300.300.30 ————— —————(—) (—) (—)

Total 0.300.300.300.300.30 0.070.070.070.070.07 —————(—) (—) (—)

Sale of ConstructionSale of ConstructionSale of ConstructionSale of ConstructionSale of Constructionmaterials and Sparesmaterials and Sparesmaterials and Sparesmaterials and Sparesmaterials and SparesBadarpur FaridabadTollways Ltd. 0.160.160.160.160.16 ————— —————

(—) (—) (—)

Alpine-Samsung-HCCJoint venture ————— 0.030.030.030.030.03 —————

(—) (0.31) (—)

Alpine-HCC Joint venture ————— ————— —————(—) (0.20) (—)

Lavasa Corporation Limited ————— ————— —————(0.81) (—) (—)

Total 0.160.160.160.160.16 0.030.030.030.030.03 —————(0.81) (0.51) (—)

Sale of Fixed AssetsSale of Fixed AssetsSale of Fixed AssetsSale of Fixed AssetsSale of Fixed AssetsPanchkutir Developers Ltd ————— ————— —————

(61.90) (—) (—)

Others ————— ————— —————(0.04) (—) (—)

Total ————— ————— —————(61.94) (—) (—)

SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)

HCC 84TH ANNUAL REPORT 2009-201076

CMYK

Rendering of Services /Rendering of Services /Rendering of Services /Rendering of Services /Rendering of Services /Financial IncomeFinancial IncomeFinancial IncomeFinancial IncomeFinancial IncomeLavasa Corporation Ltd. 12.3712.3712.3712.3712.37 ————— —————

(6.29) (—) (—)

HCC Real Estate Ltd. 7.137.137.137.137.13 ————— —————(4.06) (—) (—)

HCC Infrastructure Ltd. 5.505.505.505.505.50 ————— —————(—) (—) (—)

HCC Aviation Ltd. 4.014.014.014.014.01 ————— —————(2.56) (—) (—)

Alpine-HCC Joint venture ————— 1.761.761.761.761.76 —————(—) (8.43) (—)

Alpine-Samsung-HCC Joint venture ————— 0.220.220.220.220.22 —————(—) (—) (—)

Vikhroli Corporate Park ————— ————— 0.760.760.760.760.76(—) (—) (0.16)

Others 3.513.513.513.513.51 ————— —————(3.92) (0.69) (—)*

Total 32.5232.5232.5232.5232.52 1.981.981.981.981.98 0.760.760.760.760.76(16.83) (9.12) (0.16)

DonationDonationDonationDonationDonationGulabchand Foundation ————— ————— 3.003.003.003.003.00

(—) (—) (5.00)

Total ————— ————— 3.003.003.003.003.00(—) (—) (5.00)

Purchase of Fixed AssetsPurchase of Fixed AssetsPurchase of Fixed AssetsPurchase of Fixed AssetsPurchase of Fixed AssetsLavasa Corporation Ltd. ————— ————— —————

(0.02) (—) (—)

Total ————— ————— —————(0.02) (—) (—)

Receiving of ServicesReceiving of ServicesReceiving of ServicesReceiving of ServicesReceiving of ServicesLavasa Corporation Ltd. ————— ————— —————

(5.80) (—) (—)

Hincon Technoconsult Ltd. 0.540.540.540.540.54 ————— —————(—) (—) (—)

Hincon Holdings Ltd. ————— ————— 0.880.880.880.880.88(—) (—) (0.17)

Western Securities Ltd. 0.110.110.110.110.11 ————— —————(—) (—) (—)

HCC Aviation Ltd. 3.153.153.153.153.15 ————— —————(—) (—) (—)

Vikhroli Coprorate Park ————— ————— 6.056.056.056.056.05(—) (—) (0.18)

Others ————— ————— —————(1.25) (—) (—)

Total 3.803.803.803.803.80 ————— 6.936.936.936.936.93(7.05) (—) (0.35)

WWWWWork Bill Receiptsork Bill Receiptsork Bill Receiptsork Bill Receiptsork Bill ReceiptsLavasa Corporation Ltd. ————— ————— —————

(16.70) (—) (—)

Nirmal BOT Ltd. 36.0136.0136.0136.0136.01 ————— —————(106.03) (—) (—)

Badarpur Faridabad Tollways Ltd. 160.06160.06160.06160.06160.06 ————— —————(—) (—) (—)

Dhule Palesner Tollway Ltd. ————— 62.8862.8862.8862.8862.88 —————(—) (—) (—)

Others 12.4412.4412.4412.4412.44 ————— —————(14.67) (—) (—)

Total 208.51208.51208.51208.51208.51 62.8862.8862.8862.8862.88 —————(137.40) (—) (—)

Advances received / recoveredAdvances received / recoveredAdvances received / recoveredAdvances received / recoveredAdvances received / recoveredNirmal BOT Ltd. 4.404.404.404.404.40 ————— —————

(51.25) (—) (—)Badarpur Faridabad Tollways Ltd. 23.4823.4823.4823.4823.48 ————— —————

(35.77) (—) (—)Dhule Palesner Tollway Ltd. ————— 36.6336.6336.6336.6336.63 —————

(—) (—) (—)Others 0.140.140.140.140.14 ————— —————

(6.45) (—) (—)

Total 28.0228.0228.0228.0228.02 36.6336.6336.6336.6336.63 —————(93.47) (—) (—)

Share application money givenShare application money givenShare application money givenShare application money givenShare application money givenduring the yearduring the yearduring the yearduring the yearduring the yearDhule Palesner Tollway Ltd. ————— 6.336.336.336.336.33 —————

(—) (—) (—)

Total ————— 6.336.336.336.336.33 —————(—) (—) (—)

Advances given / repaidAdvances given / repaidAdvances given / repaidAdvances given / repaidAdvances given / repaidNirmal BOT Ltd. 15.1115.1115.1115.1115.11 ————— —————

(67.20) (—) (—)Badarpur Faridabad Tollways Ltd. 9.009.009.009.009.00 ————— —————

(43.81) (—) (—)Others 0.540.540.540.540.54 ————— —————

(8.83) (—) (—)

Total 24.6524.6524.6524.6524.65 ————— —————(119.84) (—) (—)

Equity Contribution madeEquity Contribution madeEquity Contribution madeEquity Contribution madeEquity Contribution madeduring the yearduring the yearduring the yearduring the yearduring the yearHCC Real Estate Ltd. ————— ————— —————

(100.28) (—) (—)Badarpur Faridabad Tollways Ltd. 43.8143.8143.8143.8143.81 ————— —————

(—) (—) (—)Dhule Palesner Tollway Ltd. ————— 0.130.130.130.130.13 —————

(—) (—) (—)Baharampore-Farakka Highways Ltd. ————— ————— 0.030.030.030.030.03

(—) (—) (—)Farakka-Raiganj Highways Ltd. ————— ————— 0.030.030.030.030.03

(—) (—) (—)Raiganj-Dalkhola Highways Ltd. ————— ————— 0.030.030.030.030.03

(—) (—) (—)Others 0.100.100.100.100.10 ————— —————

(0.25) (—) (—)

Total 43.9143.9143.9143.9143.91 0.130.130.130.130.13 0.090.090.090.090.09(100.53) (—) (—)

Outstanding ReceivablesOutstanding ReceivablesOutstanding ReceivablesOutstanding ReceivablesOutstanding ReceivablesNirmal BOT Ltd. 58.1458.1458.1458.1458.14 ————— —————

(36.17) (—) (—)HCC Real Estate Ltd. 121.52121.52121.52121.52121.52 ————— —————

(—) (—) (—)HCC Infrastructure Ltd. 136.63136.63136.63136.63136.63 ————— —————

(—) (—) (—)Panchkutir Developers Ltd. 91.5291.5291.5291.5291.52 ————— —————

(81.01) (—) (—)Badarpur Faridabad Tollways Ltd. ————— ————— —————

(45.81) (—) (—)Nathpa Jhakri Joint Venture ————— 8.058.058.058.058.05 —————

(—) (29.22) (—)Alpine-HCC Joint venture ————— 8.388.388.388.388.38 —————

(—) (7.27) (—)HCC-L & T-Purulia Joint Venture ————— 1.891.891.891.891.89 —————

(—) (—) (—)Vikhroli Coprorate Park ————— ————— 20.2220.2220.2220.2220.22

(—) (—) (—)Others 57.5457.5457.5457.5457.54 0.530.530.530.530.53 —————

(40.78) (7.96) (—)

Total 465.35465.35465.35465.35465.35 18.8518.8518.8518.8518.85 20.2220.2220.2220.2220.22(203.77) (44.45) (—)

SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.) Rs. Crore

Nature of Transactions Subsidiary Integrated Other RelatedCompanies JV’s Parties

SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.) Rs. Crore

Nature of Transactions Subsidiary Integrated Other RelatedCompanies JV’s Parties

HCC 84TH ANNUAL REPORT 2009-201077

CMYK

Share WShare WShare WShare WShare Warrant forfeitedarrant forfeitedarrant forfeitedarrant forfeitedarrant forfeitedduring the yearduring the yearduring the yearduring the yearduring the yearHincon Holdings Ltd. 12.5612.5612.5612.5612.56 ————— —————

(—) (—) (—)

Total 12.5612.5612.5612.5612.56 ————— —————(—) (—) (—)

Outstanding PayablesOutstanding PayablesOutstanding PayablesOutstanding PayablesOutstanding PayablesHincon Technoconsult Ltd. ————— ————— —————

(1.34) (—) (—)HCC- Pati JV ————— 2.712.712.712.712.71 —————

(—) (2.71) (—)Alpine-Samsung-HCC Joint venture ————— 1.741.741.741.741.74 —————

(—) (—) (—)Hincon Holdings Ltd. ————— ————— 12.0012.0012.0012.0012.00

(—) (—) (—)Vikhroli Coprorate Park ————— ————— —————

(—) (—) (0.34)Badarpur Faridabad Tollways Ltd. 2.552.552.552.552.55 ————— —————

(—) (—) (—)Others ————— ————— 4.334.334.334.334.33

(0.06) (—) (—)

Total 2.552.552.552.552.55 4.454.454.454.454.45 16.3316.3316.3316.3316.33(1.40) (2.71) (0.34)

Intercorporate Deposit given /Intercorporate Deposit given /Intercorporate Deposit given /Intercorporate Deposit given /Intercorporate Deposit given /repaid during the yearrepaid during the yearrepaid during the yearrepaid during the yearrepaid during the yearAlpine-Samsung-HCC Joint venture ————— ————— —————

(—) (18.00) (—)HCC Real Estate Ltd. 114.05114.05114.05114.05114.05 ————— —————

(86.77) (—) (—)HCC Infrastructure Ltd. 123.93123.93123.93123.93123.93 ————— —————

(—) (—) (—)Lavasa Corporation Ltd. ————— ————— —————

(325.00) (—) (—)Hincon Holdings Ltd. ————— ————— —————

(—) (—) (6.70)Vikhroli Corporate Park ————— ————— 24.5024.5024.5024.5024.50

(—) (—) (—)Others 43.3943.3943.3943.3943.39 ————— 0.850.850.850.850.85

(36.54) (—) (—)

Total 281.37281.37281.37281.37281.37 ————— 25.3525.3525.3525.3525.35(448.31) (18.00) (6.70)

Corporate Guarantees givenCorporate Guarantees givenCorporate Guarantees givenCorporate Guarantees givenCorporate Guarantees givenoutstanding as at the endoutstanding as at the endoutstanding as at the endoutstanding as at the endoutstanding as at the endof the yearof the yearof the yearof the yearof the yearHCC Real Estate Ltd. 423.93423.93423.93423.93423.93 ————— —————

(410.00) (—) (—)Lavasa Corporation Ltd. 555.44555.44555.44555.44555.44 ————— —————

(185.43) (—) (—)Others 42.5542.5542.5542.5542.55 ————— —————

(62.26) (—) (—)

Total 1,021.921,021.921,021.921,021.921,021.92 ————— —————(657.69) (—) (—)

Intercorporate Deposit received/Intercorporate Deposit received/Intercorporate Deposit received/Intercorporate Deposit received/Intercorporate Deposit received/recovered during the yearrecovered during the yearrecovered during the yearrecovered during the yearrecovered during the yearAlpine-Samsung-HCC Joint venture ————— ————— —————

(—) (28.00) (—)Lavasa Corporation Ltd. ————— ————— —————

(325.00) (—) (—)HCC Real Estate Ltd. 6.506.506.506.506.50 ————— —————

(86.77) (—) (—)Hincon Holdings Ltd. ————— ————— 12.7512.7512.7512.7512.75

(—) (—) (5.55)Badarpur Faridabad Tollways Ltd. 25.0025.0025.0025.0025.00 ————— —————

(—) (—) (—)Vikhroli Corporate Park ————— ————— 10.2110.2110.2110.2110.21

(—) (—) (—)Others 0.600.600.600.600.60 ————— —————

(5.47) (—) (—)

Total 32.1032.1032.1032.1032.10 ————— 22.9622.9622.9622.9622.96(417.24) (28.00) (5.55)

Bank Guarantees givenBank Guarantees givenBank Guarantees givenBank Guarantees givenBank Guarantees givenoutstanding as at theoutstanding as at theoutstanding as at theoutstanding as at theoutstanding as at theend of the yearend of the yearend of the yearend of the yearend of the yearAlpine-Samsung-HCC Joint venture ————— 78.4578.4578.4578.4578.45 —————

(—) (131.70) (—)

Alpine-HCC Joint venture ————— 24.3824.3824.3824.3824.38 —————(—) (50.62) (—)

HCC- L&T Purulia JV ————— 22.1222.1222.1222.1222.12 —————(—) (—) (—)

Others ————— ————— —————(—) (28.27) (—)

Total ————— 124.95124.95124.95124.95124.95 —————(—) (210.59) (—)

Note: Figures in brackets pertain to previous year.

D. i) Details of Transactions relating to persons referred to in item(B) above

For theFor theFor theFor theFor the For theyear endedyear endedyear endedyear endedyear ended year ended

Nature of Transactions 31st March,31st March,31st March,31st March,31st March, 31st March,20102010201020102010 2009

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs.Crore

Remuneration 14.6314.6314.6314.6314.63 10.50

Salary of Ms. ShalakaGulabchand Dhawan 0.650.650.650.650.65 0.55(Daughter of Shri Ajit Gulabchand)

Security Deposit received fromMr. Praveen Sood ————— 0.10

Rent received from Mr. Praveen Sood 0.020.020.020.020.02 0.05

ii) Options granted to Key Management Personnel underEmployees’ Stock Option Scheme

Number of Options GrantedAs atAs atAs atAs atAs at As at

31st March,31st March,31st March,31st March,31st March, 31st March,20102010201020102010 2009

i) Shri K.G. Tendulkar 617,600617,600617,600617,600617,600 617,600

ii) Shri Vinayak Deshpande 193,750193,750193,750193,750193,750 193,750

iii) Shri Praveen Sood 274,500274,500274,500274,500274,500 274,500

iv) Shri V. P. Kulkarni 137,200137,200137,200137,200137,200 137,200

28. Employees Stock Option Scheme:

a) Options granted i) The Company offered 44,58,800 StockOptions on April 25, 2008 (each optioncarrying entitlement for one equity shareof the face value of Re.1/- each) at a priceof Rs.132.50 per equity share.Out of thetotal Stock Options offered, 3,27,200 havebeen lapsed on account of resignationby employees.

In accordance with the approval of theBoard of Directors and the Shareholdersof the Company, the ESOPCompensation Committee at its meetingheld on July 20, 2009 has repriced theabove 41,31,600 options at Rs.104.05 perequity share

ii) The ESOP Compensation committee atits meeting held on 23rd October, 2008granted 1,93,750 options at an exerciseprice of Rs. 43.40 per equity share.

SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.) Rs. Crore

Nature of Transactions Subsidiary Integrated Other RelatedCompanies JV’s Parties

SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.) Rs. Crore

Nature of Transactions Subsidiary Integrated Other RelatedCompanies JV’s Parties

HCC 84TH ANNUAL REPORT 2009-201078

CMYK

b) Settlement Through Equity Shares.

c) Options vested 7,70,880 Options shall not be vested beforethe expiry of 1 year and not after 4 yearsfrom the date of grant of Options.

d) Outstanding at the beginning of the year 4,325,350

e) Granted during the year NIL

f) Forfeited during the year NIL

g) Exercised during the year NIL

h) Expired / cancelled during the year NIL

i) Outstanding at the end of the year 4,325,350

j) Exercisable at the end of the year NIL

As atAs atAs atAs atAs at As at31.03.201031.03.201031.03.201031.03.201031.03.2010 31.03.2009

29. Earnings per share:Earnings per share:Earnings per share:Earnings per share:Earnings per share:

Basic EPSBasic EPSBasic EPSBasic EPSBasic EPS

A. Profit computation for basicearnings per share of Re.1/-each

Net Profit as per Profit & LossAccount available forEquity shareholders (Rs.Crore) 81.4481.4481.4481.4481.44 125.35

B. Weighted average number ofEquity shares for (Nos.) 291,145,490291,145,490291,145,490291,145,490291,145,490 256,249,600EPS computation

C. EPS (weighted average)Basic EPS (before and afterExtraordinary Items) (Rs.) 2.802.802.802.802.80 4.89

Diluted EPSDiluted EPSDiluted EPSDiluted EPSDiluted EPS

A. Profit computation for dilutedearnings per share of Re.1/-each

Net Profit as per Profit & LossAccount available forEquity shareholders (Rs.Crore) 81.4481.4481.4481.4481.44 125.35

B. Weighted average number ofEquity shares for (Nos.) 312,975,222312,975,222312,975,222312,975,222312,975,222 279,294,402EPS computation

Diluted EPS (before and afterExtraordinary Items) (Rs.) 2.602.602.602.602.60 4.49

30. Income From operationsIncome From operationsIncome From operationsIncome From operationsIncome From operations

For theFor theFor theFor theFor the For theyear endedyear endedyear endedyear endedyear ended year ended31st March,31st March,31st March,31st March,31st March, 31st March,

20102010201020102010 2009Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs.Crore

Work Bills, Received Gross 3,410.503,410.503,410.503,410.503,410.50 3,095.99

Add: Accretion/ (Decretion) inWork in progress 231.68231.68231.68231.68231.68 208.95

Contract revenueContract revenueContract revenueContract revenueContract revenue 3,642.183,642.183,642.183,642.183,642.18 3,304.94

31. (A) Lavasa Corporation Ltd., a subsidary has issued Deep DiscountConvertible Debentures (DDCD) & Compulsory ConvertiblePreference Shares (CCPS) convertible into ordinary shares. Theparticulars, terms of issue and the status of conversion as atMarch 31, 2010 is given below.

i) Bank of India has subscribed Rs. 150 Crores in the form ofDeep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5 years.The investor has an option to convert DDCDs into equityshares at anytime within 5 years from the closing date at anequity valuation of Rs. 10,000 crores or at the time of InitialPublic Offer (IPO) whichever is earlier. DDCDs are

compulsorily convertible at the end of 5 years at an equityvaluation of Rs 10,000 crores. The Investor and HCC have aput /call option respectively to sell / purchase the DDCDs atthe end of 39th, 48th and 60th month from the closing date.

ii) Allahabad Bank has subscribed Rs. 50 Crores in the form ofDeep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5 years.The investor has an option to convert DDCDs into equityshares at anytime within 5 years from the closing date at anequity valuation of Rs. 10,000 crores or at the time of InitialPublic Offer (IPO) whichever is earlier. DDCDs arecompulsorily convertible at the end of 5 years at an equityvaluation of Rs 10,000 crores. The Investor and HCC have aput /call option respectively to sell / purchase the DDCD atthe end of 39th, 48th and 60th month from the closing date.

iii) Axis Bank has subscribed Rs 225 Crores in the form of DeepDiscount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 3.52% per annum on the facevalue of DDCD and have a maximum tenor of 5 years. Theinvestor has an option to convert DDCDs into equity sharesof the Company at anytime within 5 years at an equityvaluation of Rs. 10,000 crores from the closing date or at thetime of Initial Public Offer (IPO) whichever is earlier. DDCDsare compulsorily convertible at the end of 5 years at anequity valuation of Rs 10,000 crores. The Investor and HCChave a put/call option respectively to sell / purchase theDDCD at the end of 36th, 48th and 60th month from theclosing date.

iv) Axis Bank has subscribed Rs 25 Crores in the form ofCompulsory Convertible Preference Shares (“CCPS”).

This CCPS carry a coupon of 0.001% per annum on thesubscripton amount of CCPS. The CCPS have a maximumtenor of 5 years. The Investor has an option to convert theCCPS into equity shares of the Company at any time within5 years from the Closing Date. Axis Bank and HCC have theput /call option respectively to sell / purchase the CCPS atthe end of 36th, 48th and 60th month from the closing date.

v) Andhra Bank has subscribed Rs 25 crores in the form ofDeep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5 years.The investor has an option to convert DDCDs into equityshares at anytime within 5 years from the closing date at anequity valuation of Rs. 10,000 crores or at the time of InitialPublic Offer (IPO) whichever is earlier. DDCDs arecompulsorily convertible at the end of 5 years at an equityvaluation of Rs 10,000 crores. The Investor and HCC have aput /call option respectively to sell / purchase the DDCD atthe end of 39th, 48th and 60th month from the closing date.

vi) Indusind Bank has subscribed Rs 50 crores in the form ofDeep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5 years.The investor has an option to convert DDCD into equityshares of the Company at anytime within 5 years from theclosing date at an equity valuation of Rs 10,000 crores. TheInvestor and HCC have a put/call option respectively to sell /purchase the DDCD at the end of 3rd, 4th and 5th year fromthe closing date.

vii) United Bank of India has subscribed Rs 50 crores in theform of Deep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5 years.The investor has an option to convert DDCDs into equity

SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.) SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)

HCC 84TH ANNUAL REPORT 2009-201079

CMYK

shares at anytime within 5 years from the closing date at anequity valuation of Rs. 10,000 crores or at the time of InitialPublic Offer (IPO) whichever is earlier. DDCDs arecompulsorily convertible at the end of 5 years at an equityvaluation of Rs 10,000 crores. The Investor and HCC have aput /call option respectively to sell / purchase the DDCD atthe end of 39th, 48th and 60th month from the closing date.

viii) Allahabad Bank has subscribed Rs 50 crores in the form ofDeep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5 years.The investor has an option to convert DDCDs into equityshares at anytime within 5 years from the closing date at anequity valuation of Rs. 10,000 crores or at the time of InitialPublic Offer (IPO) whichever is earlier. DDCDs arecompulsorily convertible at the end of 5 years at an equityvaluation of Rs 10,000 crores. The Investor and HCC have aput /call option respectively to sell / purchase the DDCD atthe end of 39th, 48th and 60th month from the closing date.date. The said DDCD is secured by way of 1 Acre of Land atMulshi, Pune

ix) ICICI Bank has subscribed Rs 250 crores in the form of DeepDiscount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5 years.The investor has an option to convert DDCDs into equityshares at anytime within 5 years from the closing date at anequity valuation of Rs. 10,000 crores or at the time of InitialPublic Offer (IPO) whichever is earlier. DDCDs arecompulsorily convertible at the end of 5 years at an equityvaluation of Rs 10,000 crores. The Investor and HCC have aput /call option respectively to sell / purchase the DDCD atthe end of 39th, 48th and 60th month from the closing date.

x) IndusInd Bank has subscribed Rs 50 crores in the form ofDeep Discount Convertible Debentures (“DDCD”).

The DDCD carry a coupon of 6% per annum on the facevalue of Rs 74.94 crores of DDCD and have a maximumtenor of 5 years. The investor has an option to convert DDCDinto equity shares of the Company within 5 years from theclosing date i.e 9th July, 2009 subject to investor’s stake isnot less than 0.5% of Company’s equity capital. Theconversion amount is to be calculated based on the YTM of13% / 13.6% based on the equity valuation of Rs. 10,000crores. The Bank and Promoters have a put/call option

respectively to sell / purchase the DDCD at the end of 3rd,4th and 5th year from the closing date.

(B) Bennett Coleman & Co. Limited., has invested an amount of Rs.81.25 crores into the Company against issuance of one Warranton preferential basis, giving a right to Bennett, Coleman & Co.Limited to subscribe to 0.8125%of the fully diluted equity sharecapital of the Company as on the date of exercise of the warrant.BCCL has paid Rs 8,12,50,000/- being 10% of the exercise amountagainst the allotment of warrant. BCCL can exercise the right ofconversion at any time during the 5 years from the date ofagreement or shall exercise in whole at the end of 5th year or atthe time of IPO. In the event BCCL does not exercise its optionto acquire all the shares within 5 years the Company shall forfeitthe proportionate warrant subscription price to the extent notexercised and warrant shall lapse.

32. Donation to Political Parties

Sr. No. Name of the party Rs. Crore

1) Bharatiya Janata Party 2.00

2) Maharashtra State Nationalist Congress Party 1.00

3) All India Congress Committee 2.00

Total 5.005.005.005.005.00

33. i) Pune Paud Toll Road Company Ltd. a subsidiary has anaccumulated loss of Rs.21.65 crore as on 31st March, 2010. Thetoll road operated by the Company is expected to generatemanifold increase in the traffic plying on the road during balancepart of the concession period due to large scale hill stationtownship development namely ‘LAVASA’ taking place in theproject vicinity and also the planned ring road developmentextending the municipal limits of Pune city beyond present tollplaza location.

ii) HCC Aviation Limited, a wholly owned subsidiary, has anaccumulated loss of Rs.8.55 crore as at 31st March, 2010. TheCompany has long term business outlook and future growthplans hence, the going concern nature of the business is notadversely affected.

In the opinion of the management since the losses in both theCompanies are temporary in nature, no diminution in value ofinvestment is required.

34. Figures for the previous year have been regrouped/recast, wherevernecessary.

35. ‘ * ‘ represents amount less than Rs. 100000.

SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)SCHEDULE - Q (Contd.)

}As per our report attached AJIT GULABCHAND Chairman & Managing DirectorFor K.S. AIYAR & CO.Chartered Accountants VINAYAK DESHPANDE Y.H. MALEGAMRegistration No. 100186W President and K.G. TENDULKAR

Chief Operating Officer RAJAS R. DOSHIRAGHUVIR M. AIYAR D.M. POPATPartner PRAVEEN SOOD RAM P. GANDHI DirectorsMembership No. 38128 Group Chief Financial Officer PROF. FRED MOAVENZADEH

SHARAD M. KULKARNIVITHAL P. KULKARNI NIRMAL P. BHOGILAL

Company Secretary ANIL SINGHVI

Mumbai, Dated: 30th April, 2010 Mumbai, Dated: 30th April, 2010

HCC 84TH ANNUAL REPORT 2009-201080

CMYK

2009-102009-102009-102009-102009-10 2008-09Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs.Crore

A.A.A.A.A. CASH FLOW FROM OPERACASH FLOW FROM OPERACASH FLOW FROM OPERACASH FLOW FROM OPERACASH FLOW FROM OPERATING ACTIVITIESTING ACTIVITIESTING ACTIVITIESTING ACTIVITIESTING ACTIVITIESNet Profit before tax and extraordinary items 121.84121.84121.84121.84121.84 164.55Adjustments for :Depreciation 113.90113.90113.90113.90113.90 115.22Interest expense 226.15226.15226.15226.15226.15 224.35Interest/Dividend received (21.24)(21.24)(21.24)(21.24)(21.24) (14.41)Lease Rentals 7.027.027.027.027.02 6.83Unrealised Foreign Exchange Loss (net) 1.351.351.351.351.35 12.25(Profit)/Loss on sale of Assets 16.2516.2516.2516.2516.25 (61.63)(Profit) on sale of Investment (6.69)(6.69)(6.69)(6.69)(6.69) (1.69)Provision for Doubtful Advances 0.090.090.090.090.09 —

336.83336.83336.83336.83336.83 280.92

Operating profit before working capital changes 458.67458.67458.67458.67458.67 445.47Adjustments for :Trade & Other receivables (47.66)(47.66)(47.66)(47.66)(47.66) (208.87)Inventories (779.70)(779.70)(779.70)(779.70)(779.70) (596.77)Trade payables 172.63172.63172.63172.63172.63 390.04Client Advances (Interest Free) 293.91293.91293.91293.91293.91 108.49

(360.82)(360.82)(360.82)(360.82)(360.82) (307.11)

Cash Generated from operations 97.8597.8597.8597.8597.85 138.36Direct Taxes paid (41.10)(41.10)(41.10)(41.10)(41.10) (33.80)

(41.10)(41.10)(41.10)(41.10)(41.10) (33.80)

NET CASH FLOW FROM OPERANET CASH FLOW FROM OPERANET CASH FLOW FROM OPERANET CASH FLOW FROM OPERANET CASH FLOW FROM OPERATING ACTIVITIESTING ACTIVITIESTING ACTIVITIESTING ACTIVITIESTING ACTIVITIES 56.7556.7556.7556.7556.75 104.56B.B.B.B.B. CASH FLOW FROM INVESTING ACTIVITIESCASH FLOW FROM INVESTING ACTIVITIESCASH FLOW FROM INVESTING ACTIVITIESCASH FLOW FROM INVESTING ACTIVITIESCASH FLOW FROM INVESTING ACTIVITIES

Purchase of Fixed Assets (285.81)(285.81)(285.81)(285.81)(285.81) (194.11)Sale of Fixed Assets 28.3728.3728.3728.3728.37 70.97Decapitalisation of Fixed Assets 108.49108.49108.49108.49108.49 (98.36)Purchase of Investments (0.31)(0.31)(0.31)(0.31)(0.31) (100.54)Purchase of Investments in Subsidiaries (43.81)(43.81)(43.81)(43.81)(43.81) —Sale of Investments 7.647.647.647.647.64 32.27Inter Corporate Deposits (249.26)(249.26)(249.26)(249.26)(249.26) (31.07)Interest received 20.0220.0220.0220.0220.02 12.02Dividend received 0.240.240.240.240.24 0.56

NET CASH USED IN INVESTING ACTIVITIESNET CASH USED IN INVESTING ACTIVITIESNET CASH USED IN INVESTING ACTIVITIESNET CASH USED IN INVESTING ACTIVITIESNET CASH USED IN INVESTING ACTIVITIES (414.43)(414.43)(414.43)(414.43)(414.43) (308.26)C.C.C.C.C. CASH FLOW FROM FINANCING ACTIVITIESCASH FLOW FROM FINANCING ACTIVITIESCASH FLOW FROM FINANCING ACTIVITIESCASH FLOW FROM FINANCING ACTIVITIESCASH FLOW FROM FINANCING ACTIVITIES

Interest Paid (222.94)(222.94)(222.94)(222.94)(222.94) (220.39)Repayment of lease finance liabilities (7.02)(7.02)(7.02)(7.02)(7.02) (6.83)Proceeds from long term and other borrowings 193.88193.88193.88193.88193.88 478.07Proceeds from Issue of Shares to QIBs (net of expenses) 467.94467.94467.94467.94467.94 —Foreign Currency translation difference ————— (29.43)Reversal of Provision for Premium on buyback of FCCBs 3.663.663.663.663.66 —Provision for Premium on redemption of FCCBs (23.02)(23.02)(23.02)(23.02)(23.02) (107.78)Dividend paid (20.37)(20.37)(20.37)(20.37)(20.37) (20.42)

NET CASH USED IN FINANCING ACTIVITIESNET CASH USED IN FINANCING ACTIVITIESNET CASH USED IN FINANCING ACTIVITIESNET CASH USED IN FINANCING ACTIVITIESNET CASH USED IN FINANCING ACTIVITIES 392.13392.13392.13392.13392.13 93.22

NET INCREASE IN CASH AND CASH EQUIVNET INCREASE IN CASH AND CASH EQUIVNET INCREASE IN CASH AND CASH EQUIVNET INCREASE IN CASH AND CASH EQUIVNET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C)ALENTS (A+B+C)ALENTS (A+B+C)ALENTS (A+B+C)ALENTS (A+B+C) 34.4534.4534.4534.4534.45 (110.48)CASH AND CASH EQUIVALENTS AS AT 1/4/2009 (OPENING BALANCE) 153.87153.87153.87153.87153.87 264.35UNREALISED FOREIGN EXCHANGE GAIN/ ( LOSS ) (0.17)(0.17)(0.17)(0.17)(0.17) 0.20CASH AND CASH EQUIVALENTS 188.49188.49188.49188.49188.49 153.67

CASH AND CASH EQUIVALENTS AS AT 31/03/2010 (CLOSING BALANCE) 188.32188.32188.32188.32188.32 153.87

34.4534.4534.4534.4534.45 (110.48)NOTES : 1. Proceeds from Long Term and Other Borrowings are shown net of repayments.

2. Figures for the previous year have been regrouped /recast whereever necessary.

Cash Flow Statement for the year ended 31st March, 2010

}As per our report attached AJIT GULABCHAND Chairman & Managing DirectorFor K.S. AIYAR & CO.Chartered Accountants VINAYAK DESHPANDE Y.H. MALEGAMRegistration No. 100186W President and K.G. TENDULKAR

Chief Operating Officer RAJAS R. DOSHIRAGHUVIR M. AIYAR D.M. POPATPartner PRAVEEN SOOD RAM P. GANDHI DirectorsMembership No. 38128 Group Chief Financial Officer PROF. FRED MOAVENZADEH

SHARAD M. KULKARNIVITHAL P. KULKARNI NIRMAL P. BHOGILAL

Company Secretary ANIL SINGHVI

Mumbai, Dated: 30th April, 2010 Mumbai, Dated: 30th April, 2010

HCC 84TH ANNUAL REPORT 2009-201081

CMYK

I.I.I.I.I. Registration DetailsRegistration DetailsRegistration DetailsRegistration DetailsRegistration Details

Registration No. 1228

State Code No. 11

Balance Sheet Date 31.03.2010

II.II.II.II.II. Capital Raised During the YCapital Raised During the YCapital Raised During the YCapital Raised During the YCapital Raised During the Yearearearearear (Rs. in 000s)

Public Issue (Issue through the prospectus) Nil

Rights Issue Nil

Bonus Issue Nil

Private Placement 47,000

III.III.III.III.III. Position of Mobilisation and Deployment of FundsPosition of Mobilisation and Deployment of FundsPosition of Mobilisation and Deployment of FundsPosition of Mobilisation and Deployment of FundsPosition of Mobilisation and Deployment of Funds

Total Liabilities 62,174,771

Total Assets 62,174,771

Sources of FundsSources of FundsSources of FundsSources of FundsSources of Funds

Paid-up Capital (Including Share Application Money) 303,316

Reserves & Surplus 14,868,304

Secured Loan 9,630,339

Unsecured Loan 15,516,724

Deferred Tax Liability 1,426,405

Application of FundsApplication of FundsApplication of FundsApplication of FundsApplication of Funds

Net Fixed Assets 11,845,491

Investments 4,086,789

Net Current Assets 25,812,809

Misc. Expenditure —

Accumulated Losses —

IVIVIVIVIV..... Performance of CompanyPerformance of CompanyPerformance of CompanyPerformance of CompanyPerformance of Company

Gross Turnover/Total Income ( Including Company’s 38,610,006

share of Profit in Integrated Joint Ventures)

Less: Company’s Share of Turnover in Integrated JV’s 2,187,726

Net Total Income 36,422,280

Total Expenditure 35,203,896

Profit/(Loss) Before Tax 1,218,384

Profit/(Loss) After Tax 814,354

Net Surplus After Tax

Basic EPS …….. Annualised Rs. 2.80

— before and after Extraordinary Items

Diluted EPS …….. Annualised Rs. 2.60

— before and after Extraordinary Items

Dividend Rate 80%

VVVVV..... Generic Name of PrincipalGeneric Name of PrincipalGeneric Name of PrincipalGeneric Name of PrincipalGeneric Name of Principal

Product of CompanyProduct of CompanyProduct of CompanyProduct of CompanyProduct of Company

(As per Monetary T(As per Monetary T(As per Monetary T(As per Monetary T(As per Monetary Terms)erms)erms)erms)erms)

Item Code No. N.A

Product Description Engineering & Construction

Additional Information Pursuant to Part IV of Schedule VI to the Companies Act, 1956

HCC 84TH ANNUAL REPORT 2009-201082

CMYK

StatStatStatStatStatement Pursuant tement Pursuant tement Pursuant tement Pursuant tement Pursuant to Section 212 of the Companies o Section 212 of the Companies o Section 212 of the Companies o Section 212 of the Companies o Section 212 of the Companies AAAAAct,1ct,1ct,1ct,1ct,1956 r956 r956 r956 r956 relating telating telating telating telating to Subsidiary Companieso Subsidiary Companieso Subsidiary Companieso Subsidiary Companieso Subsidiary Companies

SrSrSrSrSr..... Name of the SubsidiaryName of the SubsidiaryName of the SubsidiaryName of the SubsidiaryName of the Subsidiary The financial yearThe financial yearThe financial yearThe financial yearThe financial year (a) Number of(a) Number of(a) Number of(a) Number of(a) Number of (b) Extent of(b) Extent of(b) Extent of(b) Extent of(b) Extent of Date from whichDate from whichDate from whichDate from whichDate from which The net aggregate amount of Profits/The net aggregate amount of Profits/The net aggregate amount of Profits/The net aggregate amount of Profits/The net aggregate amount of Profits/ The net aggregate amount of Profits/The net aggregate amount of Profits/The net aggregate amount of Profits/The net aggregate amount of Profits/The net aggregate amount of Profits/ Changes in theChanges in theChanges in theChanges in theChanges in the Material changesMaterial changesMaterial changesMaterial changesMaterial changesNo.No.No.No.No. of the subsidiaryof the subsidiaryof the subsidiaryof the subsidiaryof the subsidiary Shares held byShares held byShares held byShares held byShares held by interest of theinterest of theinterest of theinterest of theinterest of the it became ait became ait became ait became ait became a (Losses) of the subsidiary so far as(Losses) of the subsidiary so far as(Losses) of the subsidiary so far as(Losses) of the subsidiary so far as(Losses) of the subsidiary so far as (Losses) of the subsidiary so far as(Losses) of the subsidiary so far as(Losses) of the subsidiary so far as(Losses) of the subsidiary so far as(Losses) of the subsidiary so far as interest of holdinginterest of holdinginterest of holdinginterest of holdinginterest of holding between the end ofbetween the end ofbetween the end ofbetween the end ofbetween the end of

CompanyCompanyCompanyCompanyCompany holding Companyholding Companyholding Companyholding Companyholding Company holding holding holding holding holding Company atCompany atCompany atCompany atCompany at subsidiarysubsidiarysubsidiarysubsidiarysubsidiary they concern the members of thethey concern the members of thethey concern the members of thethey concern the members of thethey concern the members of the they concern the members of thethey concern the members of thethey concern the members of thethey concern the members of thethey concern the members of the Company betweenCompany betweenCompany betweenCompany betweenCompany between the subsidiary’the subsidiary’the subsidiary’the subsidiary’the subsidiary’sssssended onended onended onended onended on as on theas on theas on theas on theas on the the endthe endthe endthe endthe end of theof theof theof theof the holding Company not dealt with inholding Company not dealt with inholding Company not dealt with inholding Company not dealt with inholding Company not dealt with in holding Company dealt with inholding Company dealt with inholding Company dealt with inholding Company dealt with inholding Company dealt with in the end of thethe end of thethe end of thethe end of thethe end of the financial year andfinancial year andfinancial year andfinancial year andfinancial year and

above dateabove dateabove dateabove dateabove date financial yearfinancial yearfinancial yearfinancial yearfinancial year the holding Company’the holding Company’the holding Company’the holding Company’the holding Company’s accountss accountss accountss accountss accounts the holding Company’the holding Company’the holding Company’the holding Company’the holding Company’s accountss accountss accountss accountss accounts subsidiary’subsidiary’subsidiary’subsidiary’subsidiary’sssss 31st March, 201031st March, 201031st March, 201031st March, 201031st March, 2010of the subsidiaryof the subsidiaryof the subsidiaryof the subsidiaryof the subsidiary financial year andfinancial year andfinancial year andfinancial year andfinancial year and in: (i) Fixed Assetsin: (i) Fixed Assetsin: (i) Fixed Assetsin: (i) Fixed Assetsin: (i) Fixed Assets

for the financialfor the financialfor the financialfor the financialfor the financial for the previousfor the previousfor the previousfor the previousfor the previous (i) for the financial(i) for the financial(i) for the financial(i) for the financial(i) for the financial (ii) for the previous(ii) for the previous(ii) for the previous(ii) for the previous(ii) for the previous 31st March,201031st March,201031st March,201031st March,201031st March,2010 (ii) Investments(ii) Investments(ii) Investments(ii) Investments(ii) Investmentsyear of theyear of theyear of theyear of theyear of the financial years of thefinancial years of thefinancial years of thefinancial years of thefinancial years of the year of theyear of theyear of theyear of theyear of the financial years of thefinancial years of thefinancial years of thefinancial years of thefinancial years of the (iii) Moneys lent by(iii) Moneys lent by(iii) Moneys lent by(iii) Moneys lent by(iii) Moneys lent bysubsidiarysubsidiarysubsidiarysubsidiarysubsidiary subsidiary sincesubsidiary sincesubsidiary sincesubsidiary sincesubsidiary since subsidiarysubsidiarysubsidiarysubsidiarysubsidiary subsidiary sincesubsidiary sincesubsidiary sincesubsidiary sincesubsidiary since the subsidiary (iv)the subsidiary (iv)the subsidiary (iv)the subsidiary (iv)the subsidiary (iv)

it became theit became theit became theit became theit became the it became theit became theit became theit became theit became the Moneys borrowedMoneys borrowedMoneys borrowedMoneys borrowedMoneys borrowedholdingholdingholdingholdingholding holdingholdingholdingholdingholding by the subsidiaryby the subsidiaryby the subsidiaryby the subsidiaryby the subsidiary

Company’Company’Company’Company’Company’sssss Company’Company’Company’Company’Company’sssss other than for meet-other than for meet-other than for meet-other than for meet-other than for meet-subsidiarysubsidiarysubsidiarysubsidiarysubsidiary subsidiarysubsidiarysubsidiarysubsidiarysubsidiary ing current liabilitiesing current liabilitiesing current liabilitiesing current liabilitiesing current liabilities

Rs. LacsRs. LacsRs. LacsRs. LacsRs. Lacs Rs. LacsRs. LacsRs. LacsRs. LacsRs. Lacs Rs. LacsRs. LacsRs. LacsRs. LacsRs. Lacs Rs. LacsRs. LacsRs. LacsRs. LacsRs. Lacs

11111 Hincon THincon THincon THincon THincon Technoconsult Ltd.echnoconsult Ltd.echnoconsult Ltd.echnoconsult Ltd.echnoconsult Ltd. 31.03.2010 10,00,000 100.00% 3/30/1976 33.46 92.66 Nil 7.2 N.A. N.A.Equity Shares of

Rs.10/- each

22222 WWWWWestern Securities Ltd.estern Securities Ltd.estern Securities Ltd.estern Securities Ltd.estern Securities Ltd. 31.03.2010 19,57,500 97.88% 28-02-1997 6.81 (67.56) Nil Nil N.A. N.A.Equity Shares of

Rs.10/- each

33333 Pune Paud TPune Paud TPune Paud TPune Paud TPune Paud Toll Road Co. Ltd.oll Road Co. Ltd.oll Road Co. Ltd.oll Road Co. Ltd.oll Road Co. Ltd. 31.03.2010 54,44,500 89.98% 17-03-2005 (940.62) (1007.14) Nil Nil N.A. N.A.Equity Shares of

Rs.10/- each

44444 Nirmal BOT Ltd.Nirmal BOT Ltd.Nirmal BOT Ltd.Nirmal BOT Ltd.Nirmal BOT Ltd. 31.03.2010 3,15,00,000 100.00% 19-09-2006 (78.31) N.A. Nil N.A. N.A. N.A.Equity Shares of

Rs.10/- each

55555 HCC Infrastructure Ltd.HCC Infrastructure Ltd.HCC Infrastructure Ltd.HCC Infrastructure Ltd.HCC Infrastructure Ltd. 31.03.2010 50,000 100.00% 14-02-2008 (1,275.32) (756.67) Nil N.A. N.A. N.A.Equity Shares of

Rs.10/- each

66666 HCC AHCC AHCC AHCC AHCC Aviation Ltd.viation Ltd.viation Ltd.viation Ltd.viation Ltd. 31.03.2010 50,000 100.00% 19-05-2008 (465.47) (390.02) Nil N.A. N.A. N.A.Equity Shares of

Rs.10/- each

77777 Panchkutir Developers Ltd.Panchkutir Developers Ltd.Panchkutir Developers Ltd.Panchkutir Developers Ltd.Panchkutir Developers Ltd. 31.03.2010 100,000 100.00% 30-06-2008 (251.95) (158.17) Nil N.A. N.A. N.A.Equity Shares of

Rs.10/- each

88888 Badarpur Faridabad TBadarpur Faridabad TBadarpur Faridabad TBadarpur Faridabad TBadarpur Faridabad Tollway Ltd.ollway Ltd.ollway Ltd.ollway Ltd.ollway Ltd. 31.03.2010 $ 8,60,00,000 100.00% 17-07-2008 N.A. N.A. Nil N.A. N.A. N.A.Equity Shares of

Rs.10/- each

99999 HCC Singapore EnterprisesHCC Singapore EnterprisesHCC Singapore EnterprisesHCC Singapore EnterprisesHCC Singapore Enterprises 31.03.2010 5,000 100.00% 18-12-2007 (3.20) (7.27) Nil N.A. N.A. N.A.PTE. Ltd.PTE. Ltd.PTE. Ltd.PTE. Ltd.PTE. Ltd. Ordinary Shares of

USD.1 each

1 01 01 01 01 0 HCC Mauritius Enterprises Ltd.HCC Mauritius Enterprises Ltd.HCC Mauritius Enterprises Ltd.HCC Mauritius Enterprises Ltd.HCC Mauritius Enterprises Ltd. 31.03.2010 5,000 100.00% 17-01-2008 (3.03) (4.90) Nil N.A. N.A. N.A.Ordinary Shares of

USD.1 each

1 11 11 11 11 1 HCC Real Estate Ltd.HCC Real Estate Ltd.HCC Real Estate Ltd.HCC Real Estate Ltd.HCC Real Estate Ltd. 31.03.2010 44128790 100.00% 15-06-2005 120.31 (1,123.73) N. A. N. A. N. A. N. A.(Formerly Hincon Realty Ltd.)(Formerly Hincon Realty Ltd.)(Formerly Hincon Realty Ltd.)(Formerly Hincon Realty Ltd.)(Formerly Hincon Realty Ltd.) Equity Shares of

Rs.10 each

1 21 21 21 21 2 HCC Construction LimitedHCC Construction LimitedHCC Construction LimitedHCC Construction LimitedHCC Construction Limited 31.03.2010 50,000 100.00% 05.03.2009 (4.76) NA N.A. N.A. N.A. N.A.Equity Shares of

Rs.10/- each

1 31 31 31 31 3 Highbar THighbar THighbar THighbar THighbar Technologies Limitedechnologies Limitedechnologies Limitedechnologies Limitedechnologies Limited 31.03.2010 50,000 100.00% 25.11.2009 (18.16) NA N.A. N.A. N.A. N.A.Equity Shares of

Rs.10/- each

Subsidiaries ofSubsidiaries ofSubsidiaries ofSubsidiaries ofSubsidiaries ofHCC Real Estate Ltd.HCC Real Estate Ltd.HCC Real Estate Ltd.HCC Real Estate Ltd.HCC Real Estate Ltd.

1414141414 HRL THRL THRL THRL THRL Township Developers Limitedownship Developers Limitedownship Developers Limitedownship Developers Limitedownship Developers Limited 31.03.2010 1,00,000 100.00% 02-08-2006 (2.43) (30.23) N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

1515151515 HRL (Thane) Real Estate LimitedHRL (Thane) Real Estate LimitedHRL (Thane) Real Estate LimitedHRL (Thane) Real Estate LimitedHRL (Thane) Real Estate Limited 31.03.2010 1,00,000 100.00% 03-08-2006 (2.59) (7.57) N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

1 61 61 61 61 6 Nashik TNashik TNashik TNashik TNashik Township Developersownship Developersownship Developersownship Developersownship Developers 31.03.2010 1,00,000 100.00% 31-01-2007 (2.54) (17.68) N. A. N. A. N. A. N. A.LimitedLimitedLimitedLimitedLimited Equity Shares of

Rs. 10 each

1 71 71 71 71 7 Maan TMaan TMaan TMaan TMaan Twonwship Developerswonwship Developerswonwship Developerswonwship Developerswonwship Developers 31.03.2010 1,00,000 100.00% 02-02-2007 (3.22) (13.96) N. A. N. A. N. A. N. A.Limited, (formerly HinjewadiLimited, (formerly HinjewadiLimited, (formerly HinjewadiLimited, (formerly HinjewadiLimited, (formerly Hinjewadi Equity Shares ofTTTTTownship Developers Limited)ownship Developers Limited)ownship Developers Limited)ownship Developers Limited)ownship Developers Limited) Rs. 10 each

1 81 81 81 81 8 Powai Real Estate DevelopersPowai Real Estate DevelopersPowai Real Estate DevelopersPowai Real Estate DevelopersPowai Real Estate Developers 31.03.2010 50,000 100.00% 21-01-2009 (0.96) — N. A. N. A. N. A. N. A.LimitedLimitedLimitedLimitedLimited Equity Shares of

Rs. 10 each

1 91 91 91 91 9 Charosa Wineries LimitedCharosa Wineries LimitedCharosa Wineries LimitedCharosa Wineries LimitedCharosa Wineries Limited 31.03.2010 50,00,000 100.00% 11-12-2007 (163.63) (36.38) N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

2 02 02 02 02 0 Lavasa Corporation LimitedLavasa Corporation LimitedLavasa Corporation LimitedLavasa Corporation LimitedLavasa Corporation Limited 31.03.2010 # 3,07,06,543 64.99% 14-04-2006 9110.68 7047.35 N. A. N. A. N. A. N. A.Equity Shares ofRs. 10 each and

1,59,00,8976% CummulativePreference Shares

of Rs. 10 each

Subsidiaries ofSubsidiaries ofSubsidiaries ofSubsidiaries ofSubsidiaries ofLavasa Corporation Ltd.Lavasa Corporation Ltd.Lavasa Corporation Ltd.Lavasa Corporation Ltd.Lavasa Corporation Ltd.

2121212121 WWWWWarasgao Lake Varasgao Lake Varasgao Lake Varasgao Lake Varasgao Lake View Hotels Ltd.iew Hotels Ltd.iew Hotels Ltd.iew Hotels Ltd.iew Hotels Ltd.(formerly known as Lavasa Star(formerly known as Lavasa Star(formerly known as Lavasa Star(formerly known as Lavasa Star(formerly known as Lavasa StarHotel Ltd.)Hotel Ltd.)Hotel Ltd.)Hotel Ltd.)Hotel Ltd.) 31.03.2010 * 50,000 100.00% 01-09-2007 (4.00) 14.04 N. A. N. A. N. A. N. A.

Equity Shares ofRs. 10 each

HCC 84TH ANNUAL REPORT 2009-201083

CMYK

SrSrSrSrSr..... Name of the SubsidiaryName of the SubsidiaryName of the SubsidiaryName of the SubsidiaryName of the Subsidiary The financial yearThe financial yearThe financial yearThe financial yearThe financial year (a) Number of(a) Number of(a) Number of(a) Number of(a) Number of (b) Extent of(b) Extent of(b) Extent of(b) Extent of(b) Extent of Date from whichDate from whichDate from whichDate from whichDate from which The net aggregate amount of Profits/The net aggregate amount of Profits/The net aggregate amount of Profits/The net aggregate amount of Profits/The net aggregate amount of Profits/ The net aggregate amount of Profits/The net aggregate amount of Profits/The net aggregate amount of Profits/The net aggregate amount of Profits/The net aggregate amount of Profits/ Changes in theChanges in theChanges in theChanges in theChanges in the Material changesMaterial changesMaterial changesMaterial changesMaterial changesNo.No.No.No.No. of the subsidiaryof the subsidiaryof the subsidiaryof the subsidiaryof the subsidiary Shares held byShares held byShares held byShares held byShares held by interest of theinterest of theinterest of theinterest of theinterest of the it became ait became ait became ait became ait became a (Losses) of the subsidiary so far as(Losses) of the subsidiary so far as(Losses) of the subsidiary so far as(Losses) of the subsidiary so far as(Losses) of the subsidiary so far as (Losses) of the subsidiary so far as(Losses) of the subsidiary so far as(Losses) of the subsidiary so far as(Losses) of the subsidiary so far as(Losses) of the subsidiary so far as interest of holdinginterest of holdinginterest of holdinginterest of holdinginterest of holding between the end ofbetween the end ofbetween the end ofbetween the end ofbetween the end of

CompanyCompanyCompanyCompanyCompany holding Companyholding Companyholding Companyholding Companyholding Company holding holding holding holding holding Company atCompany atCompany atCompany atCompany at subsidiarysubsidiarysubsidiarysubsidiarysubsidiary they concern the members of thethey concern the members of thethey concern the members of thethey concern the members of thethey concern the members of the they concern the members of thethey concern the members of thethey concern the members of thethey concern the members of thethey concern the members of the Company betweenCompany betweenCompany betweenCompany betweenCompany between the subsidiary’the subsidiary’the subsidiary’the subsidiary’the subsidiary’sssssended onended onended onended onended on as on theas on theas on theas on theas on the the endthe endthe endthe endthe end of theof theof theof theof the holding Company not dealt with inholding Company not dealt with inholding Company not dealt with inholding Company not dealt with inholding Company not dealt with in holding Company dealt with inholding Company dealt with inholding Company dealt with inholding Company dealt with inholding Company dealt with in the end of thethe end of thethe end of thethe end of thethe end of the financial year andfinancial year andfinancial year andfinancial year andfinancial year and

above dateabove dateabove dateabove dateabove date financial yearfinancial yearfinancial yearfinancial yearfinancial year the holding Company’the holding Company’the holding Company’the holding Company’the holding Company’s accountss accountss accountss accountss accounts the holding Company’the holding Company’the holding Company’the holding Company’the holding Company’s accountss accountss accountss accountss accounts subsidiary’subsidiary’subsidiary’subsidiary’subsidiary’sssss 31st March, 201031st March, 201031st March, 201031st March, 201031st March, 2010of the subsidiaryof the subsidiaryof the subsidiaryof the subsidiaryof the subsidiary financial year andfinancial year andfinancial year andfinancial year andfinancial year and in: (i) Fixed Assetsin: (i) Fixed Assetsin: (i) Fixed Assetsin: (i) Fixed Assetsin: (i) Fixed Assets

for the financialfor the financialfor the financialfor the financialfor the financial for the previousfor the previousfor the previousfor the previousfor the previous (i) for the financial(i) for the financial(i) for the financial(i) for the financial(i) for the financial (ii) for the previous(ii) for the previous(ii) for the previous(ii) for the previous(ii) for the previous 31st March,201031st March,201031st March,201031st March,201031st March,2010 (ii) Investments(ii) Investments(ii) Investments(ii) Investments(ii) Investmentsyear of theyear of theyear of theyear of theyear of the financial years of thefinancial years of thefinancial years of thefinancial years of thefinancial years of the year of theyear of theyear of theyear of theyear of the financial years of thefinancial years of thefinancial years of thefinancial years of thefinancial years of the (iii) Moneys lent by(iii) Moneys lent by(iii) Moneys lent by(iii) Moneys lent by(iii) Moneys lent bysubsidiarysubsidiarysubsidiarysubsidiarysubsidiary subsidiary sincesubsidiary sincesubsidiary sincesubsidiary sincesubsidiary since subsidiarysubsidiarysubsidiarysubsidiarysubsidiary subsidiary sincesubsidiary sincesubsidiary sincesubsidiary sincesubsidiary since the subsidiary (iv)the subsidiary (iv)the subsidiary (iv)the subsidiary (iv)the subsidiary (iv)

it became theit became theit became theit became theit became the it became theit became theit became theit became theit became the Moneys borrowedMoneys borrowedMoneys borrowedMoneys borrowedMoneys borrowedholdingholdingholdingholdingholding holdingholdingholdingholdingholding by the subsidiaryby the subsidiaryby the subsidiaryby the subsidiaryby the subsidiary

Company’Company’Company’Company’Company’sssss Company’Company’Company’Company’Company’sssss other than for meet-other than for meet-other than for meet-other than for meet-other than for meet-subsidiarysubsidiarysubsidiarysubsidiarysubsidiary subsidiarysubsidiarysubsidiarysubsidiarysubsidiary ing current liabilitiesing current liabilitiesing current liabilitiesing current liabilitiesing current liabilities

Rs. LacsRs. LacsRs. LacsRs. LacsRs. Lacs Rs. LacsRs. LacsRs. LacsRs. LacsRs. Lacs Rs. LacsRs. LacsRs. LacsRs. LacsRs. Lacs Rs. LacsRs. LacsRs. LacsRs. LacsRs. Lacs

AJIT GULABCHAND Chairman & Managing Director

Y.H.MALEGAMK.G.TENDULKARRAJAS R. DOSHID. M. POPAT

PRAVEEN SOOD RAM P. GANDHI Directors

Group Chief Financial Officer PROF. FRED MOAVENZADEHSHARAD M. KULKARNINIRMAL P. BHOGILAL

VITHAL P. KULKARNI ANIL SINGHVICompany Secretary

Mumbai, Dated: 30th April, 2010 Mumbai, Dated: 30th April, 2010

}

2 22 22 22 22 2 Lavasa Hotel LimitedLavasa Hotel LimitedLavasa Hotel LimitedLavasa Hotel LimitedLavasa Hotel Limited 31.03.2010 * 50,000 100.00% 01-09-2007 (392.41) (71.79) N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

2 32 32 32 32 3 Apollo Lavasa HealthApollo Lavasa HealthApollo Lavasa HealthApollo Lavasa HealthApollo Lavasa Health 31.03.2010 *6,88,300 93.23% 13-12-2007 (157.20) 20.83 N. A. N. A. N. A. N. A.Corporation LimitedCorporation LimitedCorporation LimitedCorporation LimitedCorporation Limited Equity Shares of

Rs. 10 each

2424242424 Lakeshore WLakeshore WLakeshore WLakeshore WLakeshore Watersports Companyatersports Companyatersports Companyatersports Companyatersports Company 31.03.2010 * 50,000 100.00% 01-08-2008 (201.89) (83.38) N. A. N. A. N. A. N. A.LimitedLimitedLimitedLimitedLimited Equity Shares of

Rs. 10 each

2 52 52 52 52 5 Ecomotel Hotel LimitedEcomotel Hotel LimitedEcomotel Hotel LimitedEcomotel Hotel LimitedEcomotel Hotel Limited 31.03.2010 * 61,419 65.40% 18-08-2008 (98.20) (1.41) N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

2626262626 Dasve Convention Center LimitedDasve Convention Center LimitedDasve Convention Center LimitedDasve Convention Center LimitedDasve Convention Center Limited 31.03.2010 * 50,000 100.00% 19-08-2008 (189.03) (1.59) N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

2 72 72 72 72 7 Dasve Business Hotel LimitedDasve Business Hotel LimitedDasve Business Hotel LimitedDasve Business Hotel LimitedDasve Business Hotel Limited 31.03.2010 * 50,000 100.00% 19-08-2008 (0.88) (2.16) N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

2828282828 Dasve Hospitality Institutes LimitedDasve Hospitality Institutes LimitedDasve Hospitality Institutes LimitedDasve Hospitality Institutes LimitedDasve Hospitality Institutes Limited 31.03.2010 *1,05,000 100.00% 19-09-2008 (698.01) (59.16) N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

2 92 92 92 92 9 Lakeview Clubs LimitedLakeview Clubs LimitedLakeview Clubs LimitedLakeview Clubs LimitedLakeview Clubs Limited 31.03.2010 * 50,000 100.00% 19-09-2008 (126.59) (3.16) N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

3 03 03 03 03 0 Dasve Retail LimitedDasve Retail LimitedDasve Retail LimitedDasve Retail LimitedDasve Retail Limited 31.03.2010 * 50,000 100.00% 08-10-2008 (53.20) (1.31) N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

3131313131 Full Spectrum Adventure LimitedFull Spectrum Adventure LimitedFull Spectrum Adventure LimitedFull Spectrum Adventure LimitedFull Spectrum Adventure Limited 31.03.2010 * 50,000 100.00% 01-12-2008 (83.26) (0.82) N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

3232323232 Spotless Laundry Services LimitedSpotless Laundry Services LimitedSpotless Laundry Services LimitedSpotless Laundry Services LimitedSpotless Laundry Services Limited 3/31/2010 * 44,030 63.35% 20-1-2009 (29.05) — N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

3 33 33 33 33 3 Lavasa Bamboocrafts LimitedLavasa Bamboocrafts LimitedLavasa Bamboocrafts LimitedLavasa Bamboocrafts LimitedLavasa Bamboocrafts Limited 3/31/2010 * 50,000 100.00% 24-2-2009 (94.77) — N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

3 43 43 43 43 4 Knowledge VKnowledge VKnowledge VKnowledge VKnowledge Vistas Limitedistas Limitedistas Limitedistas Limitedistas Limited 3/31/2010 * 1,92,000 100.00% 24-2-2009 (6.60) — N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

3535353535 Green Hills Residences LimitedGreen Hills Residences LimitedGreen Hills Residences LimitedGreen Hills Residences LimitedGreen Hills Residences Limited 3/31/2010 * 50,000 100.00% 6-5-2009 (1.05) — N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

3 63 63 63 63 6 My City TMy City TMy City TMy City TMy City Technology Limitedechnology Limitedechnology Limitedechnology Limitedechnology Limited 3/31/2010 * 2,32,065 81.00% 4-8-2009 (2.62) — N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

3 73 73 73 73 7 Reasonable Housing LimitedReasonable Housing LimitedReasonable Housing LimitedReasonable Housing LimitedReasonable Housing Limited 3/31/2010 * 50,000 100.00% 23-9-2009 (1.04) — N. A. N. A. N. A. N. A.Equity Shares of

Rs. 10 each

3 83 83 83 83 8 Minfur Interior TMinfur Interior TMinfur Interior TMinfur Interior TMinfur Interior Technologiesechnologiesechnologiesechnologiesechnologies 3/31/2010 * 50,000 100.00% 30-11-2009 (0.71) — N. A. N. A. N. A. N. A.LimitedLimitedLimitedLimitedLimited Equity Shares of

Rs. 10 each

* Held by Lavasa Corporation Limited, a subsidiary of HCC Real Estate Limited.# Held by HCC directly (1340 shares) and by HREL, wholly owned subsidiary of HCC (3,07,05,203 shares).$ Held by HCC directly (4,38,60,000 shares) and by HCC Infrastructure Limited, wholly owned subsidiary of HCC (4,21,40,000 shares).

HCC 84TH ANNUAL REPORT 2009-201085

CMYK

Auditors’ Report

CONSOLIDATED FINANCIAL STATEMENTS

AUDITOR’S REPORAUDITOR’S REPORAUDITOR’S REPORAUDITOR’S REPORAUDITOR’S REPORT TO THE BOARD OF DIRECTORST TO THE BOARD OF DIRECTORST TO THE BOARD OF DIRECTORST TO THE BOARD OF DIRECTORST TO THE BOARD OF DIRECTORSOF HINDUSTOF HINDUSTOF HINDUSTOF HINDUSTOF HINDUSTAN CONSTRUCTION COMPAN CONSTRUCTION COMPAN CONSTRUCTION COMPAN CONSTRUCTION COMPAN CONSTRUCTION COMPANY LIMITED,ANY LIMITED,ANY LIMITED,ANY LIMITED,ANY LIMITED,ITS SUBSIDIARIES, ASSOCIAITS SUBSIDIARIES, ASSOCIAITS SUBSIDIARIES, ASSOCIAITS SUBSIDIARIES, ASSOCIAITS SUBSIDIARIES, ASSOCIATES AND JOINTTES AND JOINTTES AND JOINTTES AND JOINTTES AND JOINTVENTURESVENTURESVENTURESVENTURESVENTURES

We have examined the attached Consolidated BalanceSheet of Hindustan Construction Company Limited., itsSubsidiaries, Associates and Integrated Joint Ventures(“The HCC Group”) as at 31st March, 2010, theConsolidated Profit and Loss Account and theConsolidated Cash Flow Statement for the year thenended. These financial statements are the responsibilityof the Hindustan Construction Company Limited’sManagement and have been prepared by theManagement on the basis of separate financial statementsand other financial information regarding components.Our responsibility is to express an opinion on thesefinancial statements based on our audit.

We conducted our audit in accordance with generallyaccepted auditing standards in India. These Standardsrequire that we plan and perform the audit to obtainreasonable assurance about whether the financialstatements are prepared, in all material respects, inaccordance with an identified financial reportingframework and are free of material misstatements. Anaudit includes, examining on a test basis, evidencesupporting the amounts and disclosures in the financialstatements. An audit also includes assessing theaccounting principles used and significant estimatesmade by Management, as well as evaluating the overallfinancial statement presentation. We believe that our auditprovides a reasonable basis for our opinion.

We did not audit the financial statements of certainSubsidiaries and Integrated Joint Ventures, whosefinancial statements reflect total assets of Rs. 873.46Crore, Company’s share of Revenue of Rs. 233.51Crore,the Loss of Rs. 3.83 Crore and Cash outflows of Rs 1.08Crore in these financial statements. These financialstatements have been audited by other auditors whosereports have been furnished to us and in our opinion, inso far as it relates to the amounts included in respect ofthe said audited Subsidiaries and Joint Ventures, is basedsolely on the Reports of the other auditors. The financialstatements of certain subsidiaries reflecting total assets

of Rs0.38 Crore, share in revenue of Rs. Nil Crore, sharein loss of Rs.0.05 Crore in the consolidated financialstatements are unaudited.

We report that the consolidated financial statements havebeen prepared by the Hindustan Construction CompanyLimited’s Management in accordance with therequirements of Accounting Standard (AS) 21-”Consolidated Financial Statements”, Accounting Standard(AS) 23-”Accounting for Investments in Associates inConsolidated Financial Statements” and AccountingStandard (AS) 27-”Financial Reporting of Interest in JointVentures”, issued by the Institute of CharteredAccountants of India and on the basis of the separateaudited financial statements of the HCC Group includedin the Consolidated financial statements.

On the basis of the information and explanation given tous and on the consideration of the separate audit reportson individual audited financial statements of the HCCGroup its aforesaid Subsidiaries, Associates and JointVentures, we are of the opinion that:

a) The Consolidated Balance Sheet gives a true andfair view of the consolidated state of affairs of theHCC Group as at 31st March, 2010;

b) The Consolidated Profit and Loss account gives atrue and fair view of the consolidated profits of theHCC Group for the year then ended; and

c) The Consolidated Cash Flow Statement gives a trueand fair view of the consolidated cash flows of theHCC Group for the year ended on that date.

For K. S. Aiyar & Co.Chartered Accountants

Registration Number 100186 W

Raghuvir M.AiyarPartner

Membership No.38128

Place: MumbaiDate: 30th April, 2010

HCC 84TH ANNUAL REPORT 2009-201086

CMYK

Consolidated Balance Sheet as at 31st March, 2010

As at31.03.2009

ScheduleScheduleScheduleScheduleSchedule Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreSOURCES OF FUNDSSOURCES OF FUNDSSOURCES OF FUNDSSOURCES OF FUNDSSOURCES OF FUNDSShare CapitalShare CapitalShare CapitalShare CapitalShare Capital AAAAA 30.3230.3230.3230.3230.32 25.63Share WShare WShare WShare WShare Warrantsarrantsarrantsarrantsarrants 8.128.128.128.128.12 23.31Reserves and SurplusReserves and SurplusReserves and SurplusReserves and SurplusReserves and Surplus BBBBB 1276.791276.791276.791276.791276.79 830.55

Total Shareholders’ Funds 1315.231315.231315.231315.231315.23 879.49Minority InterestMinority InterestMinority InterestMinority InterestMinority Interest 141.72141.72141.72141.72141.72 127.66LoansLoansLoansLoansLoans(a) Secured CCCCC 3448.083448.083448.083448.083448.08 2446.15(b) Unsecured DDDDD 1930.301930.301930.301930.301930.30 1607.48

Total Loans 5378.385378.385378.385378.385378.38 4053.63Deferred TDeferred TDeferred TDeferred TDeferred Tax Liability (Net)ax Liability (Net)ax Liability (Net)ax Liability (Net)ax Liability (Net) 222.03222.03222.03222.03222.03 122.16

TOTAL 7057.367057.367057.367057.367057.36 5182.94

APPLICAAPPLICAAPPLICAAPPLICAAPPLICATION OF FUNDSTION OF FUNDSTION OF FUNDSTION OF FUNDSTION OF FUNDSFixed Assets(a) Gross Block EEEEE 3571.413571.413571.413571.413571.41 2363.83(b) Less: Depreciation 731.58731.58731.58731.58731.58 582.88

(c) Net Block 2839.832839.832839.832839.832839.83 1780.95(d) Items Awaiting Completion orCommissioning 1020.071020.071020.071020.071020.07 1094.31

Total Fixed Assets 3859.903859.903859.903859.903859.90 2875.26InvestmentsInvestmentsInvestmentsInvestmentsInvestments FFFFF 305.57305.57305.57305.57305.57 95.29Current Assets, Loans and AdvancesCurrent Assets, Loans and AdvancesCurrent Assets, Loans and AdvancesCurrent Assets, Loans and AdvancesCurrent Assets, Loans and AdvancesA.A.A.A.A. Current AssetsCurrent AssetsCurrent AssetsCurrent AssetsCurrent Assets GGGGG

(a) Inventories 4222.084222.084222.084222.084222.08 3305.10(b) Sundry Debtors 248.87248.87248.87248.87248.87 103.99(c) Cash and Bank Balances 310.57310.57310.57310.57310.57 219.12(d) Other Current Assets 4.944.944.944.944.94 3.95

4786.464786.464786.464786.464786.46 3632.16B.B.B.B.B. Loans and AdvancesLoans and AdvancesLoans and AdvancesLoans and AdvancesLoans and Advances HHHHH 698.30698.30698.30698.30698.30 466.95

Total Current Assets, Loans and Advances 5484.765484.765484.765484.765484.76 4099.11Less: Current Liabilities and ProvisionsLess: Current Liabilities and ProvisionsLess: Current Liabilities and ProvisionsLess: Current Liabilities and ProvisionsLess: Current Liabilities and Provisions IIIIIa) Current Liabilities 2397.002397.002397.002397.002397.00 1713.72b) Provisions 195.87195.87195.87195.87195.87 173.10

Total Current Liabilities and Provisions 2592.872592.872592.872592.872592.87 1886.82

Net Current AssetsNet Current AssetsNet Current AssetsNet Current AssetsNet Current Assets 2891.892891.892891.892891.892891.89 2212.29Miscellaneous ExpenditureMiscellaneous ExpenditureMiscellaneous ExpenditureMiscellaneous ExpenditureMiscellaneous Expenditure ————— 0.10

TOTAL 7057.367057.367057.367057.367057.36 5182.94

The Annexed Notes (Schedule -Q ) form an Integral part of the Accounts.

As per our report attached AJIT GULABCHAND Chairman & Managing DirectorFor K.S. AIYAR & CO.Chartered AccountantsRegn. No. 100186W Y.H. MALEGAM

K.G. TENDULKARRAGHUVIR M. AIYAR PRAVEEN SOOD RAJAS R. DOSHIPartner Group Chief Financial Officer D.M. POPATMembership No. 38128 RAM P. GANDHI Directors

PROF. FRED MOAVENZADEHSHARAD M. KULKARNI

VITHAL P.KULKARNI NIRMAL P. BHOGILALCompany Secretary ANIL SINGHVI

Mumbai, Dated: 30th April, 2010 Mumbai, Dated: 30th April, 2010

}

HCC 84TH ANNUAL REPORT 2009-201087

CMYK

Consolidated Profit and Loss Account for the year ended 31st March, 2010

Previous YearScheduleScheduleScheduleScheduleSchedule Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

INCOMEINCOMEINCOMEINCOMEINCOMEIncome From Operations JJJJJ 3975.193975.193975.193975.193975.19 3560.31

3975.193975.193975.193975.193975.19 3560.31Other Income KKKKK 14.7414.7414.7414.7414.74 (2.88)

3989.933989.933989.933989.933989.93 3557.43EXPENDITUREEXPENDITUREEXPENDITUREEXPENDITUREEXPENDITUREConstruction Expenses LLLLL 2773.192773.192773.192773.192773.19 2510.23Employees’ Remuneration and Benefits MMMMM 438.24438.24438.24438.24438.24 389.62Office and Site Establishment NNNNN 238.03238.03238.03238.03238.03 146.16ExpensesInterest (Net) OOOOO 276.36276.36276.36276.36276.36 236.44Depreciation / Amortisation 140.47140.47140.47140.47140.47 125.91

3866.293866.293866.293866.293866.29 3408.36

PROFIT BEFORE TPROFIT BEFORE TPROFIT BEFORE TPROFIT BEFORE TPROFIT BEFORE TAX AND SHARE OFAX AND SHARE OFAX AND SHARE OFAX AND SHARE OFAX AND SHARE OFPROFIT / (LOSS) OF ASSOCIAPROFIT / (LOSS) OF ASSOCIAPROFIT / (LOSS) OF ASSOCIAPROFIT / (LOSS) OF ASSOCIAPROFIT / (LOSS) OF ASSOCIATESTESTESTESTES 123.64123.64123.64123.64123.64 149.07Provision for Current Tax (refer note no IV-18) PPPPP 69.3069.3069.3069.3069.30 34.52Provision for Deferred Tax (refer note no IV-18) 109.17109.17109.17109.17109.17 45.82Provision for Fringe Benefit Tax — 2.76MAT credit entitlement (56.31)(56.31)(56.31)(56.31)(56.31) (33.56)

PROFIT AFTER TPROFIT AFTER TPROFIT AFTER TPROFIT AFTER TPROFIT AFTER TAXAXAXAXAX 1.481.481.481.481.48 99.53Less: Profit / (Loss) Transfered to Minority Share-holders (4.58)(4.58)(4.58)(4.58)(4.58) 40.29Share of Profit / (Loss) of Associates (0.26)(0.26)(0.26)(0.26)(0.26) —

NET PROFITNET PROFITNET PROFITNET PROFITNET PROFIT 5.805.805.805.805.80 59.24Add/ Less Preference Dividend adjustment on consolidation — 7.72

NET SURPLUS AFTER TNET SURPLUS AFTER TNET SURPLUS AFTER TNET SURPLUS AFTER TNET SURPLUS AFTER TAXAXAXAXAX 5.805.805.805.805.80 66.96Add:Balance brought forward from Last Year 118.95118.95118.95118.95118.95 132.59Add:Transferred from Debenture Redemption Reserve 5.415.415.415.415.41 8.50

AMOUNT AAMOUNT AAMOUNT AAMOUNT AAMOUNT AVVVVVAILABLE FOR APPROPRIAAILABLE FOR APPROPRIAAILABLE FOR APPROPRIAAILABLE FOR APPROPRIAAILABLE FOR APPROPRIATIONTIONTIONTIONTION 130.16130.16130.16130.16130.16 208.05Less:Appropriations:(a) Proposed Dividend 24.2624.2624.2624.2624.26 20.50(b) Tax on Proposed Dividend 4.124.124.124.124.12 3.48(c) Proposed Preference Dividend 0.680.680.680.680.68 3.97(d) Tax on Proposed preference Dividend 0.270.270.270.270.27 1.62(e) Debenture Redemption Reserve 8.758.758.758.758.75 12.92(f) General Reserve 10.0010.0010.0010.0010.00 25.00(g) Capital Redemption Reserve ————— 21.61

48.0848.0848.0848.0848.08 89.10

Balance carried to Balance Sheet 82.0882.0882.0882.0882.08 118.95

Basic EPS Rs.— before and after Extraordinary Items 0.220.220.220.220.22 2.46Diluted EPS (on Adjusted profit) Rs.— before and after Extraordinary Items 0.210.210.210.210.21 2.26The Annexed Notes (Schedule -Q) form an Integral part of the Accounts.

As per our report attached AJIT GULABCHAND Chairman & Managing DirectorFor K.S. AIYAR & CO.Chartered AccountantsRegn. No. 100186W Y.H. MALEGAM

K.G. TENDULKARRAGHUVIR M. AIYAR PRAVEEN SOOD RAJAS R. DOSHIPartner Group Chief Financial Officer D.M. POPATMembership No. 38128 RAM P. GANDHI Directors

PROF. FRED MOAVENZADEHSHARAD M. KULKARNI

VITHAL P.KULKARNI NIRMAL P. BHOGILALCompany Secretary ANIL SINGHVI

Mumbai, Dated: 30th April, 2010 Mumbai, Dated: 30th April, 2010

}

HCC 84TH ANNUAL REPORT 2009-201088

CMYK

Schedules forming part of the Balance Sheet

SCHEDULE - ASCHEDULE - ASCHEDULE - ASCHEDULE - ASCHEDULE - A As at31.03.2009

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreSHARE CAPITSHARE CAPITSHARE CAPITSHARE CAPITSHARE CAPITALALALALALAuthorised Capital

50,000 9.5% Redeemable Cumulative 0.500.500.500.500.50 0.50Second Preference Shares ofRs.100/- each

49,50,00,000 Equity Shares of Re.1/- each 49.5049.5049.5049.5049.50 49.50(previous year 49,50,00,000shares of Re.1/- each).

TOTAL 50.0050.0050.0050.0050.00 50.00

Issued, Subscribed and Paid-up:Issued, Subscribed and Paid-up:Issued, Subscribed and Paid-up:Issued, Subscribed and Paid-up:Issued, Subscribed and Paid-up:Equity Share CapitalEquity Share CapitalEquity Share CapitalEquity Share CapitalEquity Share Capital30,32,49,600 Equity Shares of Re.1/- each 30.3230.3230.3230.3230.32 25.62

(Previous year 25,62,49,600Equity shares of Re.1/- each)Less: 26,000 Equity Shares Held byWestern Securities Ltd.- a Subsidiary 0.00*0.00*0.00*0.00*0.00* 0.00*

30.3130.3130.3130.3130.31 25.62Add: Forfeited Shares 0.010.010.010.010.01 0.01

TOTAL 30.3230.3230.3230.3230.32 25.6325.6325.6325.6325.63

NOTES:NOTES:NOTES:NOTES:NOTES:

1. Out of 30,32,49,600 Equity Shares of Re.1/- each

a. 12,68,66,250 Equity Shares were issued as fully paid BonusShares by capitalisation of Reserves and Surplus.

b. 2,90,55,400 Equity Shares were issued to two SEBI RegisteredInstitutional Investors and a Domestic Mutual Fund on apreferential basis on 31st March, 2005.

c. 2,69,54,200 Shares representing 2,69,54,200 Global DepositoryShares were issued on 29.03.2006 pursuant to GlobalDepository Offering by the Company. Out of above 2,68,14,054Global Depository Shares (previous year 2,68,14,054) have beenconverted into Indian Equity shares.

2. 4,70,00,000 Equity Shares were issued to QIB’s by way of QualifiedInstitutional Placement on 4th July 2009.

SCHEDULE - BSCHEDULE - BSCHEDULE - BSCHEDULE - BSCHEDULE - B As at31.03.2009

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreReserves and SurplusReserves and SurplusReserves and SurplusReserves and SurplusReserves and Surplus(a)(a)(a)(a)(a) Share Premium AccountShare Premium AccountShare Premium AccountShare Premium AccountShare Premium Account

Balance as per last Account 502.24502.24502.24502.24502.24 573.39Add: Additions during the year 475.41475.41475.41475.41475.41 —

977.65977.65977.65977.65977.65 573.39Less: QIP/Bond Issue expenses (net of tax) 8.038.038.038.038.03 —Add: Reversal of Provision for Premium

on buyback of FCCB’s (net of tax) 2.412.412.412.412.41 —Less: Provision for Premium on

FCCB redemption (net of tax) 15.2215.2215.2215.2215.22 71.15

956.81956.81956.81956.81956.81 502.24

(b)(b)(b)(b)(b) General ReserveGeneral ReserveGeneral ReserveGeneral ReserveGeneral ReserveBalance as per last Account 160.24160.24160.24160.24160.24 164.67Add: Transferred from Profit and Loss Account 10.0010.0010.0010.0010.00 25.00

170.24170.24170.24170.24170.24 189.67Less: Adjustment of Exchange Gain difference ————— 29.43

170.24170.24170.24170.24170.24 160.24

(c)(c)(c)(c)(c) Capital ReserveCapital ReserveCapital ReserveCapital ReserveCapital Reserve(Forfeited Equity Share W(Forfeited Equity Share W(Forfeited Equity Share W(Forfeited Equity Share W(Forfeited Equity Share Warrants)arrants)arrants)arrants)arrants) 15.1915.1915.1915.1915.19 —

(d)(d)(d)(d)(d) Debenture Redemption Reserve:Debenture Redemption Reserve:Debenture Redemption Reserve:Debenture Redemption Reserve:Debenture Redemption Reserve:Balance as per last Account 27.4927.4927.4927.4927.49 23.07Add: Transferred from Profit and Loss Account 8.758.758.758.758.75 12.92

36.2436.2436.2436.2436.24 35.99Less: Transferred to Profit and Loss Account 5.415.415.415.415.41 8.50

30.8330.8330.8330.8330.83 27.49

(e)(e)(e)(e)(e) Forfeited Debentures AccountForfeited Debentures AccountForfeited Debentures AccountForfeited Debentures AccountForfeited Debentures Account 0.020.020.020.020.02 0.02(f)(f)(f)(f)(f) Capital redemption reserveCapital redemption reserveCapital redemption reserveCapital redemption reserveCapital redemption reserve 21.6121.6121.6121.6121.61 21.61(g)(g)(g)(g)(g) Profit and Loss AccountProfit and Loss AccountProfit and Loss AccountProfit and Loss AccountProfit and Loss Account 82.0882.0882.0882.0882.08 118.95

TOTAL 1276.791276.791276.791276.791276.79 830.55

SCHEDULE - CSCHEDULE - CSCHEDULE - CSCHEDULE - CSCHEDULE - C As at31.03.2009

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreSECURED LOANSSECURED LOANSSECURED LOANSSECURED LOANSSECURED LOANS(a)(a)(a)(a)(a) Debentures:Debentures:Debentures:Debentures:Debentures:

(i) 11.1% Non-Convertible“F” Series 100.00100.00100.00100.00100.00 100.00

(ii) 9% Non-Convertible UTI Bank 33.3333.3333.3333.3333.33 50.00(iii) 9.5% Non-Convertible 50.0050.0050.0050.0050.00 50.00(iv) 10% Non-Convertible

“E” Series — 5.00(v) 6% Secured DDCD having

face value of Rs 70.84 crorewith United Bank of India 49.2149.2149.2149.2149.21 —

(vi) One 3.52% Secured DDCDhaving face value of Rs 387.40crore with Axis Bank 262.89262.89262.89262.89262.89 239.41

(vii) One 6% Secured DDCDhaving face value of Rs 234.92crore with Bank of India 162.58162.58162.58162.58162.58 171.71

(viii) One 6% Secured DDCDhaving face value of Rs 78.31crore with Allahabad Bank 53.0953.0953.0953.0953.09 56.29

(ix) One 6% Secured DDCDhaving face value of Rs 74.94crore with Allahabad Bank 54.9454.9454.9454.9454.94 —

(x) One 6% Secured DDCDhaving face value of Rs 353.40crore with Andhra Bank 239.17239.17239.17239.17239.17 —

(xi) One 6% Secured DDCDhaving face value of Rs 35.42crore with Indus Ind Bank 24.6824.6824.6824.6824.68 —

(xii) One 6% Secured DDCD havingface value of Rs 70.84 croresecured by English mortgage 48.4348.4348.4348.4348.43 —

1078.321078.321078.321078.321078.32 672.41(b)(b)(b)(b)(b) TTTTTerm Loanserm Loanserm Loanserm Loanserm Loans

(i) From Banks (Indian Currency) 1743.711743.711743.711743.711743.71 1557.70(ii) From Banks (Foreign Currency) 63.4263.4263.4263.4263.42 85.70(iii) From Financial Institution 97.2397.2397.2397.2397.23 42.38(iv) Cash Credit 130.42130.42130.42130.42130.42 87.00

2034.782034.782034.782034.782034.78 1772.78Interest accrued & Due 1.051.051.051.051.05 0.96

(c)(c)(c)(c)(c) From HDFCFrom HDFCFrom HDFCFrom HDFCFrom HDFCCorporate Loan 333.93333.93333.93333.93333.93 —

TOTAL 3448.083448.083448.083448.083448.08 2446.15

Notes:Notes:Notes:Notes:Notes:Privately Placed Non Convertible DebenturesPrivately Placed Non Convertible DebenturesPrivately Placed Non Convertible DebenturesPrivately Placed Non Convertible DebenturesPrivately Placed Non Convertible Debenturesi)i)i)i)i) 11.10% Non-convertible debentures:11.10% Non-convertible debentures:11.10% Non-convertible debentures:11.10% Non-convertible debentures:11.10% Non-convertible debentures: Secured by first charge by

way of hypothecation of specific immovable and movable propertiesas specified in first and second schedule of the trust deed executedon 27th August, 2008 in favour of IDBI Trusteeship Services Ltd.(ITSL), the trustees to the debenture holders. These debentureshaving a face value of Rs. 10,00,000/- each aggregating Rs. 100crore are to be redeemed in four equal installments at the end of4th, 5th, 6th and 7th year from the date of allotment ie. 5th August,2008.

ii)ii)ii)ii)ii) 9% Non-convertible debentures:9% Non-convertible debentures:9% Non-convertible debentures:9% Non-convertible debentures:9% Non-convertible debentures: Secured by first charge onCompany’s specific movable properties as specified in secondschedule of the trust deed executed on 17th January, 2007 in favourof UTI Bank Ltd., the trustees to the debenture holders. Thesedebentures having a face value of Rs.10,00,000/- each aggregatingRs.50 crore are to be redeemed in three annual equal installmentscommencing from the end of 3rd, 4th and 5th year from the date offirst disbursement i.e. 07th September,2006. The first installment ofRs.16.67 crore has been paid on the due date i.e. 07thSeptember,2009.

iii)iii)iii)iii)iii) 9.5% Non-convertible debentures: 9.5% Non-convertible debentures: 9.5% Non-convertible debentures: 9.5% Non-convertible debentures: 9.5% Non-convertible debentures: Secured by first charge onCompany’s specific movable properties as specified in secondschedule of the trust deed executed on 17th January, 2007 in favourof UTI Bank Ltd., the trustees to the debenture holders. Thesedebentures having a face value of Rs.10,00,000/- each aggregatingRs.50 crore are to be redeemed by bullet payment at the end of 5thyear from the date of allotment i.e. 20th November,2007.

iv)iv)iv)iv)iv) 10% Non Convertible Debentures “E” Series : 10% Non Convertible Debentures “E” Series : 10% Non Convertible Debentures “E” Series : 10% Non Convertible Debentures “E” Series : 10% Non Convertible Debentures “E” Series : Secured by firstcharge by way of hypothecation of specific movable properties asspecified in second schedule of the trust deed executed on 20thJanuary, 2003 in favour of UTI Bank Ltd., the trustees to thedebenture holders. These debentures having a face value of Rs.100/-

HCC 84TH ANNUAL REPORT 2009-201089

CMYK

each aggregating Rs. 15 crore are to be redeemed in seven halfyearly installments at the end of 48th, 54th, 60th, 66th, 72nd, 78thand 84th month from the date of allotment i.e. 25th October, 2002.These debentures are redeemed on 23rd October, 2009.

v)v)v)v)v) One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures havingface value of Rs 70.84 crore, secured by charge created by EnglishMortgage Deed on Land of Lavasa Project admeasuring one acrewith United Bank of India.

vi)vi)vi)vi)vi) One 3.52% Secured Deep Discount Convertible Debentures One 3.52% Secured Deep Discount Convertible Debentures One 3.52% Secured Deep Discount Convertible Debentures One 3.52% Secured Deep Discount Convertible Debentures One 3.52% Secured Deep Discount Convertible Debentures havingface value of Rs 387.40 crore, secured by charge created by EnglishMortgage Deed on Land of Lavasa Project admeasuring one acrewith Axis Bank.

vii)vii)vii)vii)vii) One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures havingface value of Rs 234.92 crore, secured by charge created by EnglishMortgage Deed on Land of Lavasa Project admeasuring one acrewith Bank of India.

viii)viii)viii)viii)viii) One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures havingface value of Rs 78.31 crore, secured by charge created by EnglishMortgage Deed on Land of Lavasa Project admeasuring one acrewith Allahabad Bank.

ix)ix)ix)ix)ix) One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures havingface value of Rs 74.94 crore, secured by charge created by EnglishMortgage Deed on Land of Lavasa Project admeasuring one acrewith Allahabad Bank.

x)x)x)x)x) One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures havingface value of Rs 35.42 crore, secured by charge created by EnglishMortgage Deed on Land of Lavasa Project admeasuring one acrewith Indusind Bank.

xi)xi)xi)xi)xi) One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures One 6% Secured Deep Discount Convertible Debentures havingface value of Rs 70.84 crore, secured by charge created by EnglishMortgage Deed on Land of Lavasa Project admeasuring one acre.

Banks:Banks:Banks:Banks:Banks:1.1.1.1.1. Cash credit limits are secured against hypothecation of work in

progress, stores, book debts, dues and advances and residualcharge/mortgage on plant & machinery and land and buildings atVillage Tara, District Raigad.

2.2.2.2.2. EXIM Bank TEXIM Bank TEXIM Bank TEXIM Bank TEXIM Bank Term Loanerm Loanerm Loanerm Loanerm LoanSecured by a first charge on movable fixed assets acquired / to beacquired by the company as specified in schedule III-A of the loanagreement executed on 22nd March, 2007.

3.3.3.3.3. State Bank of TState Bank of TState Bank of TState Bank of TState Bank of Travancore Travancore Travancore Travancore Travancore Term Loanerm Loanerm Loanerm Loanerm LoanSecured by a first charge by way of hypothecation of a pool ofspecific plant,machinery,tools and accessories acquired / to beacquired by the Company as specified in schedule II of the deed ofhypothecation executed in favour of the Bank on 15th February,2007 and deed of hypothecation executed on 23rd March, 2009 fordisbursement of Rs.75 Crore on 25th March, 2009.

4.4.4.4.4. Bank of MaharashtraBank of MaharashtraBank of MaharashtraBank of MaharashtraBank of MaharashtraSecured by first charge by way of hypothecation of specific assetsin favour of the Bank as described in the fourth schedule of thedeed of hypothecation executed on 26th December, 2007.

5.5.5.5.5. State Bank of IndiaState Bank of IndiaState Bank of IndiaState Bank of IndiaState Bank of IndiaSecured by first charge by way of hypothecation of specific fixedassets in favour of the Bank as described in the annexure II to theagreement of loan executed on 30th November, 2007.

6.6.6.6.6. Axis BankAxis BankAxis BankAxis BankAxis BankSecured by first charge by way of hypothecation of specific movablefixed assets as specified in the schedule annexed to the loanagreement executed on 29th September, 2008.Badarpur Faridabad TBadarpur Faridabad TBadarpur Faridabad TBadarpur Faridabad TBadarpur Faridabad Toll Road Ltd.oll Road Ltd.oll Road Ltd.oll Road Ltd.oll Road Ltd.a) A first charge by way of hypothecation of all moveable assets,

both present and future, all intangible assets of borrower,assignment of right and government approvals excluding theproject assets as defined in the concession agreement.

b) Pledge of equity shares held by the promoters- HindustanConstruction Company Ltd representing 51% of the issued,paid up and voting equity share capital of the company forthe period upto expiry of 36 months from commercialoperations date and thereafter the pledged shares % will comedown to 26% of equity share capital of the company.

c) A first charge on bank accounts including receivables, theEscrow and retention accounts required to be created by thecompany under any project document or contract.

7.7.7.7.7. IDBI BankIDBI BankIDBI BankIDBI BankIDBI BankSecured by way of a) Second charge on all the movable assets ofthe Company as on March 31, 2008 and b) First charge on one Flatlocated at “Greater Kailash – II” New Delhi – 110048.

Nirmal BOT Ltd.Nirmal BOT Ltd.Nirmal BOT Ltd.Nirmal BOT Ltd.Nirmal BOT Ltd.a) A first charge by way of hypothecation of all moveable assets,

both present and future, all intangible assets of borrower,assignment of right and government approvals excluding theproject assets as defined in the concession agreement.

b) Pledge of equity shares held by the promoters- HindustanConstruction Company Ltd- representing 51% of the issued,paid up and voting equity share capital of the company forthe period upto expiry of 36 months from commercialoperations date and thereafter the pledged shares % will comedown to 26% of equity share capital of the Company.

c) A first charge on company’s bank accounts including theEscrow account establised by the company and each of theother accounts required to be created by the company underany project document or contract.The land is under lien to IDBI Trusteeship services Limited byway of charge dated 26-10-2007 for loan of Rs 252 croresanctioned by the consortium of Bankers.

8.8.8.8.8. Bank of BarodaBank of BarodaBank of BarodaBank of BarodaBank of BarodaSecured by first charge by way of hypothecation of specific movableproperties as described in the second schedule of the CompositeHypothecation agreement of loan executed on 18th May, 2009.

9.9.9.9.9. Standard Chartered BankStandard Chartered BankStandard Chartered BankStandard Chartered BankStandard Chartered BankSecured by first charge by way of hypothecation of fixed movableassets acquired under the facility as described in the first scheduleto the memorandum of Hypothecation executed on 10th November,2009.

10.10.10.10.10. Development Bank of SingaporeDevelopment Bank of SingaporeDevelopment Bank of SingaporeDevelopment Bank of SingaporeDevelopment Bank of SingaporeSecured by first charge by way of hypothecation of specific movableassets based on the terms of the deed of hypothecation to beexecuted. The creation of security is under process.

11.11.11.11.11. HDFCHDFCHDFCHDFCHDFCHCC Real Estate Ltd. Secured by mortgage of property financedand corporate guarantee by Hindustan Construction CompanyLimited.

12.12.12.12.12. TTTTTerm Loan - Lavasa Corporation Ltd.erm Loan - Lavasa Corporation Ltd.erm Loan - Lavasa Corporation Ltd.erm Loan - Lavasa Corporation Ltd.erm Loan - Lavasa Corporation Ltd.Secured by charge created by English Mortgage Deed on Land ofLavasa Project admeasuring 6950.96 acres (previous yr 7696.12acres); and premises, building constructed or to be constructedthereon. All present & future moveable assets.

13.13.13.13.13. Others:Others:Others:Others:Others:SREI Equipment Finance Private Limited:SREI Equipment Finance Private Limited:SREI Equipment Finance Private Limited:SREI Equipment Finance Private Limited:SREI Equipment Finance Private Limited: Secured by first chargeby way of hypothecation of specific movable assets as described inthe annexure to schedule VIII of the loan agreement executed on3rd February, 2010 (for disbursement of Rs.25 Crore) and on 2ndMarch, 2010 (for disbursement of Rs.50 Crore)

SCHEDULE - DSCHEDULE - DSCHEDULE - DSCHEDULE - DSCHEDULE - D As at31.03.2009

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreUNSECURED LOANSUNSECURED LOANSUNSECURED LOANSUNSECURED LOANSUNSECURED LOANS1)1)1)1)1) Short TShort TShort TShort TShort Term Loans and Advanceserm Loans and Advanceserm Loans and Advanceserm Loans and Advanceserm Loans and Advances

i)i)i)i)i) From BanksFrom BanksFrom BanksFrom BanksFrom Banks(a) Commercial Paper (Maximum balance 360.00360.00360.00360.00360.00 130.00

outstanding during the year Rs.450 Crsprevious year Rs.165 Crs)

(b) Term Loans 206.26206.26206.26206.26206.26 391.41(c) Term Loans (Foreign Currency) ————— 20.03

Interest accrued & Due ————— 0.28ii)ii)ii)ii)ii) From OthersFrom OthersFrom OthersFrom OthersFrom Others

Intercorporate Deposits. 15.0515.0515.0515.0515.05 50.002)2)2)2)2) Other LoansOther LoansOther LoansOther LoansOther Loans

i)i)i)i)i) From banksFrom banksFrom banksFrom banksFrom banks(i) Rupee Loans 544.99544.99544.99544.99544.99 254.99(ii) Foreign Currency Loans 11.3311.3311.3311.3311.33 132.37(iii) Others 3.203.203.203.203.20 0.67

ii)ii)ii)ii)ii) Deposits from LicenseesDeposits from LicenseesDeposits from LicenseesDeposits from LicenseesDeposits from Licensees 16.2016.2016.2016.2016.20 —iii)iii)iii)iii)iii) From Financial institutionsFrom Financial institutionsFrom Financial institutionsFrom Financial institutionsFrom Financial institutions 290.28290.28290.28290.28290.28 80.00iv)iv)iv)iv)iv) Zero Coupon Convertible ForeignZero Coupon Convertible ForeignZero Coupon Convertible ForeignZero Coupon Convertible ForeignZero Coupon Convertible Foreign

Currency Bonds due 2011Currency Bonds due 2011Currency Bonds due 2011Currency Bonds due 2011Currency Bonds due 2011 435.29435.29435.29435.29435.29 500.03(refer note no IV 6)

3)3)3)3)3) Preference Share CapitalPreference Share CapitalPreference Share CapitalPreference Share CapitalPreference Share Capital1,32,50,000 6% Cumulative Redeemable

Preference Shares of Rs. 10/- each 22.7022.7022.7022.7022.70 22.702,50,00,000 1% Compulsory Convertible

Preference Shares of Rs. 10/- each 25.0025.0025.0025.0025.00 25.00

TOTAL 1930.301930.301930.301930.301930.30 1607.48

HCC 84TH ANNUAL REPORT 2009-201090

CMYK

SCHEDULE - ESCHEDULE - ESCHEDULE - ESCHEDULE - ESCHEDULE - E

FIXED ASSETSFIXED ASSETSFIXED ASSETSFIXED ASSETSFIXED ASSETS (Rs. Crore)

ASSETSASSETSASSETSASSETSASSETS GROSS BLOCKGROSS BLOCKGROSS BLOCKGROSS BLOCKGROSS BLOCK DEPRECIADEPRECIADEPRECIADEPRECIADEPRECIATION/AMORTION/AMORTION/AMORTION/AMORTION/AMORTISATISATISATISATISATIONTIONTIONTIONTION NET BLOCKNET BLOCKNET BLOCKNET BLOCKNET BLOCK

As at Additions Deductions As atAs atAs atAs atAs at As at For the Deductions UptoUptoUptoUptoUpto As atAs atAs atAs atAs at As at01.04.09 31.03.31.03.31.03.31.03.31.03.1010101010 01.04.09 year 31.03.31.03.31.03.31.03.31.03.1010101010 31.03.31.03.31.03.31.03.31.03.1010101010 31.03.09

At Cost:At Cost:At Cost:At Cost:At Cost:Goodwill 55.88 — — 55.8855.8855.8855.8855.88 — — — ————— 55.8855.8855.8855.8855.88 55.88

Freehold Land (Book Value) 13.56 24.31 — 37.8737.8737.8737.8737.87 — 0.00* — 0.00*0.00*0.00*0.00*0.00* 37.8737.8737.8737.8737.87 13.56

Buildings & Sheds 280.49 577.72 4.10 854.11854.11854.11854.11854.11 20.01 15.05 1.78 33.2833.2833.2833.2833.28 820.83820.83820.83820.83820.83 260.48

Plant & Machinery 1427.44 263.59 122.63 1568.401568.401568.401568.401568.40 456.10 93.57 5.51 544.15544.15544.15544.15544.15 1024.251024.251024.251024.251024.25 971.34

Heavy Vehicles 146.54 15.47 5.35 156.67156.67156.67156.67156.67 37.77 16.19 1.34 52.6252.6252.6252.6252.62 104.05104.05104.05104.05104.05 108.77

Light Vehicles 29.18 7.36 4.03 32.5132.5132.5132.5132.51 10.67 2.81 1.72 11.7611.7611.7611.7611.76 20.7520.7520.7520.7520.75 18.51

Helicopter 49.49 147.05 39.23 157.31157.31157.31157.31157.31 5.31 5.96 3.99 7.287.287.287.287.28 150.03150.03150.03150.03150.03 44.18

Speed Boat 3.61 0.53 0.02 4.124.124.124.124.12 0.35 0.67 — 1.021.021.021.021.02 3.093.093.093.093.09 3.26

Furniture andOffice Equipments 36.91 0.44 0.52 36.8336.8336.8336.8336.83 16.36 8.94 0.18 25.1125.1125.1125.1125.11 11.7311.7311.7311.7311.73 20.55

Computers 25.28 2.89 0.50 27.6727.6727.6727.6727.67 19.69 3.19 0.03 22.8522.8522.8522.8522.85 4.824.824.824.824.82 5.59

Computer Software 2.00 — — 2.002.002.002.002.00 1.22 — — 1.221.221.221.221.22 0.780.780.780.780.78 0.79

Intangible Assets 293.45 344.60 — 638.05638.05638.05638.05638.05 15.40 16.89 — 32.2932.2932.2932.2932.29 605.76605.76605.76605.76605.76 278.05

TTTTTotal of this yearotal of this yearotal of this yearotal of this yearotal of this year 2363.832363.832363.832363.832363.83 1383.961383.961383.961383.961383.96 176.38176.38176.38176.38176.38 3571.413571.413571.413571.413571.41 582.88582.88582.88582.88582.88 163.27163.27163.27163.27163.27 14.5514.5514.5514.5514.55 731.58731.58731.58731.58731.58 2839.832839.832839.832839.832839.83 1780.961780.961780.961780.961780.96

Previous Year 1579.86 824.68 40.71 2363.83 468.33 145.81 31.26 582.88 1780.96

Less Transferred to project WIP 22.8022.8022.8022.8022.80Depreciation as per profit and loss account 140.47140.47140.47140.47140.47

Items Awaiting Completion or Commissioning 1020.071020.071020.071020.071020.07

TTTTTotalotalotalotalotal 3859.903859.903859.903859.903859.90

Note: Deductions in Gross block includes decapitalisation of Foreign exchange and CENVAT credit availed.

SCHEDULE - FSCHEDULE - FSCHEDULE - FSCHEDULE - FSCHEDULE - F As at31.03.2009

CostCostCostCostCost CostCostCostCostCost Cost CostUnquotedUnquotedUnquotedUnquotedUnquoted QuotedQuotedQuotedQuotedQuotedUnquoted QuotedRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore Rs. Crore

INVESTMENTSINVESTMENTSINVESTMENTSINVESTMENTSINVESTMENTS

Long TLong TLong TLong TLong Term Investmentserm Investmentserm Investmentserm Investmentserm Investments

(a)(a)(a)(a)(a) Investment in Associate CompaniesInvestment in Associate CompaniesInvestment in Associate CompaniesInvestment in Associate CompaniesInvestment in Associate Companies(i) Bon Sera Hotels Ltd 1.291.291.291.291.29 —(ii) SOL Hospitality Ltd 0.080.080.080.080.08 —(iii) Palmetto Hospitality Ltd 0.010.010.010.010.01 —

(b)(b)(b)(b)(b) Other Investments:Other Investments:Other Investments:Other Investments:Other Investments:(i) Walchand Co-op.Housing 0.00*0.00*0.00*0.00*0.00* 0.00*

Society Ltd. 5 Equity Sharesof Rs.50/- each fully paid(Rs. 250 /- Unquoted)

(ii) Shushrusha Citizens 0.00*0.00*0.00*0.00*0.00* 0.00*Co-op. Hospital Ltd. -100 Equity Shares ofRs.100/- each fully paid

(iii) Housing Development ————— 0.04Finance Corporation Ltd.25,044 Equity Shares ofRs.10/- each fully paid.

(iv) Hindustan Oil Exploration ————— 0.91Co.Ltd. 2,35,000 Equity Sharesof Rs.10/- each fully paid(95,000 Equity Sharespurchased on RightBasis in Ratio 2 : 3)

(v) HDFC Bank Ltd. 0.00*0.00*0.00*0.00*0.00* 0.00*500 Equity Shares ofRs.10/- each fully paid

(vi) Hincon Finance Ltd. 0.120.120.120.120.12 0.121,20,000 Equity Shares ofRs.10/- each fully paid

(vii) Space Theme Park India 0.040.040.040.040.04 —Limited 50,000 EquityShares of Rs.10/- fully paid up

(viii)Jyoti Ltd 12.0012.0012.0012.0012.00 12.0012,00,000 Equity Sharesof Rs.10/- each fully paid

(ix) Punjab National Bank ————— 0.04943 Equity Shares ofRs. 10/- each fully paid

(c)(c)(c)(c)(c) Current InvestmentsCurrent InvestmentsCurrent InvestmentsCurrent InvestmentsCurrent Investments1) ICICI Prudential Flexible ————— 0.45

Income Plan Premiumdaily Dividend

2) Akruti City Limited 0.00*0.00*0.00*0.00*0.00* 0.00*(Formerly Akruti Nirman Ltd)10 Equity Shares of Rs.10/- each

3) Ansal Housing & 0.00*0.00*0.00*0.00*0.00* 0.00*Construction Limited10 Equity Shares of Rs.10/- each

4) Ansal Properties & 0.00*0.00*0.00*0.00*0.00* 0.00*Infra Limited10 Equity Shares of Rs.10/- each

5) Ashiana Housing Limited 0.00*0.00*0.00*0.00*0.00* 0.00*10 Equity Shares of Rs.10/- each

6) DLF Limited 0.00*0.00*0.00*0.00*0.00* 0.00*10 Equity Shares of Rs.10/- each

7) D S Kulkarni Developers 0.00*0.00*0.00*0.00*0.00* 0.00*Limited10 Equity Shares of Rs.10/- each

SCHEDULE - FSCHEDULE - FSCHEDULE - FSCHEDULE - FSCHEDULE - F As at31.03.2009

CostCostCostCostCost CostCostCostCostCost Cost CostUnquotedUnquotedUnquotedUnquotedUnquoted QuotedQuotedQuotedQuotedQuotedUnquoted QuotedRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore Rs. Crore

HCC 84TH ANNUAL REPORT 2009-201091

CMYK

8) HDIL 0.00*0.00*0.00*0.00*0.00* 0.00*10 Equity Shares of Rs.10/- each

9) Indiabulls Real Estate Limited 0.00*0.00*0.00*0.00*0.00* 0.00*10 Equity Shares of Rs.10/- each

10) Mahindra Lifestyle Limited 0.00*0.00*0.00*0.00*0.00* 0.00*(formerly Mahindra Gesco Ltd)10 Equity Shares of Rs.10/- each

11) Orbit Corporation Limited 0.00*0.00*0.00*0.00*0.00* 0.00*10 Equity Shares of Rs.10/- each

12) Parsvnath Developers Limited 0.00*0.00*0.00*0.00*0.00* 0.00*10 Equity Shares of Rs.10/- each

13) Peninsula Land Limited 0.00*0.00*0.00*0.00*0.00* 0.00*10 Equity Shares of Rs.10/- each

14) Shoba Developers Limited 0.00*0.00*0.00*0.00*0.00* 0.00*10 Equity Shares of Rs.10/- each

15) Unitech Limited 0.00*0.00*0.00*0.00*0.00* 0.00*10 Equity Shares of Rs.10/- each

16) LIC Mutual Fund- Floating 14.7314.7314.7314.7314.73 —Rate Fund -Short Term Plan14732831.24 units @ 10.00 each(Previous Year - Nil)

17) Birla Sunlife Saving Fund 12.6312.6312.6312.6312.63 23.00Daily Div. Reinvestment Plan12605140.174 units @ 10.02 each

18) Birla Sunlife Cash Plus - Institutional 15.0015.0015.0015.0015.00 0.27Premium-Daily Dividend14970806.925 units @ 10.02 each

19) Birla Sunlife Saving Fund Institutional 10.0310.0310.0310.0310.03 —Daily Dividend Reinvestment10024450.236 units @ 10.01 each(Previous Year - Nil)

20) Birla Sunlife Quarterly Interval 10.0110.0110.0110.0110.01 0.80Series IV Dividend Reinvestment10000000 units @ 10.01 each

21) Birla Sunlife Saving Fund 4.454.454.454.454.45 —Institutional Daily DividendReinvestment4449295.3240 units @ Rs. 10.01each (Previous Year - Nil)

22) HDFC FMP 100D-MAR-10- 50.0450.0450.0450.0450.04 20.05Dividend Series-X Plan50000000 units @ 10.01 each

23) LIC Mutual Fund- Saving Plus 25.0025.0025.0025.0025.00 —Fund -Daily Dividend Plan25001951.71 units @ 10.00each (Previous Year - Nil)

24) LIC M F- Saving Plus Fund - 2.002.002.002.002.00 —Daily Div.Plan17174651.698 units @ 10.00each (Previous Year - Nil)

25) Principal Money Manager Fund 20.0020.0020.0020.0020.00 2.39Institutional Dividend Plan19229659.8270 units @ 10.40 each

26) Baroda Pioneer Treasury 15.0515.0515.0515.0515.05 —Advantage Fund InstitutionalDaily Dividend Plan15032194.351 units @ 10.01each (Previous Year - Nil)

27) Baroda Pioneer PSUL Bond Fund 5.005.005.005.005.00 —Monthly Dividend Plan4985740.7810 units @ 10.03each (Previous Year - Nil)

28) UTI Mutual Fund - Fixed 40.2440.2440.2440.2440.24 20.00Income Interval Fund -Series II Plan VI40228592.34 units @ 10.00 each

29) UTI Mutual Fund - Fixed 5.105.105.105.105.10 —Income Interval Fund -Series II Plan V5087270.251 units @ 10.03each (Previous Year - Nil)

30) ICICI Prudential Institutional ————— 15.01Liquid plan(1,50,02486.038 units ofRs 10/- each)

31) Reliance Money Manager 0.390.390.390.390.39 0.20Mutual Fund - Daily Dividend Plan3879.338 units @ 1001.34each

32) Reliance Quarterly Interval 20.1520.1520.1520.1520.15 —Fund-Series II Plan19995600.968 units @ 10.08each (Previous Year - Nil)

33) Reliance Liquidity Fund-Daily 10.0010.0010.0010.0010.00 —Dividend Reinvestment Plan9995202.303 units @ 10.00each (Previous Year - Nil)

34) ICICI Prudential Ultra Short 10.4510.4510.4510.4510.45 —Term Plan Super PremiumDaily Dividend10428977.869 units @ 10.02each (Previous Year - Nil)

35) ICICI Prudential Banking & 20.0620.0620.0620.0620.06 —PSU Debt Fund Daily Dividend20004289.9330 units @ 10.03each (Previous Year - Nil)

36) ICICI Liquid Plan Super Institutional 1.651.651.651.651.65 —Daily Dividend 156235.197 units@ 105.74 each

TOTAL 1.561.561.561.561.56 304.01304.01304.01304.01304.01 0.120.120.120.120.12 95.1795.1795.1795.1795.17

305.57305.57305.57305.57305.57 95.29

Market VMarket VMarket VMarket VMarket Valuealuealuealuealue Market VMarket VMarket VMarket VMarket Valuealuealuealuealue

Notes:Notes:Notes:Notes:Notes:

1.1.1.1.1. Aggregate of Investments:Aggregate of Investments:Aggregate of Investments:Aggregate of Investments:Aggregate of Investments:(i) Quoted Investments 304.01304.01304.01304.01304.01 299.90299.90299.90299.90299.90 95.17 117.89(ii) Unquoted Investments 1.561.561.561.561.56 0.12

TOTAL 305.57305.57305.57305.57305.57 95.29

Note :- * represents amount less than Rs. 100000.

SCHEDULE - F (Contd.)SCHEDULE - F (Contd.)SCHEDULE - F (Contd.)SCHEDULE - F (Contd.)SCHEDULE - F (Contd.) As at31.03.2009

CostCostCostCostCost CostCostCostCostCost Cost CostUnquotedUnquotedUnquotedUnquotedUnquoted QuotedQuotedQuotedQuotedQuotedUnquoted QuotedRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore Rs. Crore

SCHEDULE - FSCHEDULE - FSCHEDULE - FSCHEDULE - FSCHEDULE - F As at31.03.2009

CostCostCostCostCost CostCostCostCostCost Cost CostUnquotedUnquotedUnquotedUnquotedUnquoted QuotedQuotedQuotedQuotedQuotedUnquoted QuotedRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore Rs. Crore

As at31.03.2009

2.2.2.2.2. Investments & Mutual Funds Purchased and Sold during the yearInvestments & Mutual Funds Purchased and Sold during the yearInvestments & Mutual Funds Purchased and Sold during the yearInvestments & Mutual Funds Purchased and Sold during the yearInvestments & Mutual Funds Purchased and Sold during the year

Name of the SecurityName of the SecurityName of the SecurityName of the SecurityName of the Security Face VFace VFace VFace VFace Valuealuealuealuealue No. of UnitsNo. of UnitsNo. of UnitsNo. of UnitsNo. of Units Rs. CroreRs. CroreRs. CroreRs. CroreRs. CroreKotak Liquid InstitutionalPremium -Daily Dividend RP Rs.10.00 each. 8177885 10.00Birla Sunlife Cash Plus-Institutional Premium DailyDividend RP Rs.10.00 each. 19961076 20.00Birla Sunlife Saving Fund-Institutional Daily Dividend RP Rs.10.00 each. 19988272 20.00ICICI Pru. Institutional LiquidPlan-Super InstitutionalDaily Dividend RP Rs.10.00 each. 39991202 40.00HDFC Liquid Fund PremiumPlan Institutional DailyDividend RP Rs.10.00 each. 24470220 30.00UTI Liquid Fund Cash PlanInstitutional Daily Dividend RP Rs.10.00 each. 196185 20.00Kotak Flexi Debt SchemeInstitutional Daily Dividend RP Rs.10.00 each. 19907492 20.00BSL Cash Plus InstitutionalPremium Daily Dividend Rs.10.01 each. 20008336 20.02BSL Cash Plus InstitutionalPremium Daily Dividend Rs.10.02 each. 14970807 15.00BSL Interval Income Series 2Dividend Plan Rs.10.01 each. 265263 0.27BSL Saving Fund InstitutionalDaily Dividend Reinvestment Rs.10.01 each. 10024450 10.03

HCC 84TH ANNUAL REPORT 2009-201092

CMYK

BSL Qtly Interval Series-IVDividend Reinvestment Rs.10.01 each. 10006900 10.01HDFC FMP 100D-MAR-10-Dividend Series-X Rs.10.01 each. 50000000 50.04HDFC MF Daily Dividend Plan Rs.12.26 each. 24975 0.03J M Liquidity Fund Super PlusDividend Rs.10.01 each. 2391575 2.39Reliance Money Mgr Fund- Rs. 1001.14 3880 0.39Institutional Daily Div Plan each.Reliance Quarterly IntervalFund- Series II - Plan Rs.10.08 each. 19995601 20.15Reliance Liquidity Fund DailyDividend Reinvestment Plan Rs.10.00 each. 9995202 10.00Principal Money ManagerFund Institutional Div. Plan Rs.10.40 each. 19229660 20.00LIC MF-Floating Rate Fund-Short Term Plan Rs.10.00 each. 14732831 14.73LIC MF - Saving Plus Fund -Daily Dividend Plan Rs.10.00 each. 25001952 25.00HDFC Cash ManagementFund- Saving Plan- Daily Div. Rs.10.64 each. 18821747 20.02UTI MF - Daily Dividend plan Rs.18.22 each. 10976045 20.00UTI MF - Fixed IncomeInterval Fund Series II plan VI Rs.10.00 each. 40228592 40.24UTI MF - Fixed IncomeInterval Fund Series II plan V Rs.10.03 each. 5087270 5.10ICICI Prudential Flexi IncomeDaily Dividend Plan Rs.10.57 each. 14201307 15.02ICICI Pru. Ultra STP SuperPremium Daily Div. Plan Rs.10.02 each. 10428978 10.45ICICI Pru Banking & PSUDebt Fund Daily Dividend Plan Rs.10.03 each. 20004290 20.06Baroda Pioneer TreasuryAdvantage Fund Daily Div. Plan Rs.10.01 each. 15032194 15.05Baroda Pioneer PSU BondFund Monthly Dividend Plan Rs.10.03 each. 4985741 5.00LIC MF Saving Plus Fund -Daily Dividend Plan Rs.9.98 each. 2003606 2.00BSL Saving Fund Inst -Daily Dividend Reinvestment Rs.10.00 each. 4449295 4.45Reliance Money ManagerFund Institutional Option (G) Rs 1236.87each 56601 7.00HDFC Cash ManagementFund (G) Rs 19.89 each 5028248 10.00Kotak Floater Long Term (G) Rs 14.40 each 6947080 10.00Birla Sun life Saving FundInstitutional (G) Rs 17.22 each 5807598 10.00NLPSG Canara RobecoTreasury Advantage SuperInstitutional Growth fund Rs 13.71 each 7302596 10.01GFCG IDFC Money ManagerFund- Treasury SuperInstitutional Plan Rs 10.76 each 9296504 10.00

SCHEDULE - GSCHEDULE - GSCHEDULE - GSCHEDULE - GSCHEDULE - G As at31.03.2009

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

CURRENT ASSETSCURRENT ASSETSCURRENT ASSETSCURRENT ASSETSCURRENT ASSETSInventoriesInventoriesInventoriesInventoriesInventories(a) Stores,Spares and Embedded

Goods, at Cost 276.65276.65276.65276.65276.65 319.24(b) Fuel, at Cost 13.7213.7213.7213.7213.72 12.63(c) Land 520.26520.26520.26520.26520.26 179.31(d) Materials In transit, at Cost 1.071.071.071.071.07 —(e) Work In Progress: 3521.923521.923521.923521.923521.92 2842.01

Finished Units (at Cost) ————— 0.06Less:(a) Advances Received /

Other Recoveries 304.25304.25304.25304.25304.25 426.45

SCHEDULE - F (Contd.)SCHEDULE - F (Contd.)SCHEDULE - F (Contd.)SCHEDULE - F (Contd.)SCHEDULE - F (Contd.) As at31.03.2009

2.2.2.2.2. Investments & Mutual Funds Purchased and Sold during the yearInvestments & Mutual Funds Purchased and Sold during the yearInvestments & Mutual Funds Purchased and Sold during the yearInvestments & Mutual Funds Purchased and Sold during the yearInvestments & Mutual Funds Purchased and Sold during the year

Name of the SecurityName of the SecurityName of the SecurityName of the SecurityName of the Security Face VFace VFace VFace VFace Valuealuealuealuealue No. of UnitsNo. of UnitsNo. of UnitsNo. of UnitsNo. of Units Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore (b) Related site mobilisationexpenses 88.2488.2488.2488.2488.24 148.78

392.49392.49392.49392.49392.49

3129.433129.433129.433129.433129.43 2266.84Add:(i) Contract Work in Progress ————— 270.28(ii) Retention Money 280.95280.95280.95280.95280.95 256.80

280.95280.95280.95280.95280.95

TOTAL 4222.084222.084222.084222.084222.08 3305.10

Sundry DebtorsSundry DebtorsSundry DebtorsSundry DebtorsSundry DebtorsUnsecured, Considered Good:(a) Outstanding over six months 0.210.210.210.210.21 1.16(b) Others 248.66248.66248.66248.66248.66 102.83

TOTAL 248.87248.87248.87248.87248.87 103.99

Cash and Bank BalancesCash and Bank BalancesCash and Bank BalancesCash and Bank BalancesCash and Bank Balances(a) Cash on Hand 1.441.441.441.441.44 1.63(b) Cheques on Hand 37.8637.8637.8637.8637.86 25.04(c) With Scheduled Banks:

(i) Current Accounts inIndian Rupees 162.47162.47162.47162.47162.47 125.34

(ii) Current Accounts inForeign Currency 56.8656.8656.8656.8656.86 32.46

(iii) Deposit Accounts inIndian Rupees 51.9251.9251.9251.9251.92 34.64

(iv) Deposit Accounts inForeign currency ————— 0.01

(v) Other Banks 0.020.020.020.020.02 —

TOTAL 310.57310.57310.57310.57310.57 219.12

Other Current AssetsOther Current AssetsOther Current AssetsOther Current AssetsOther Current AssetsInterest Accrued on Others 4.94 3.95

TOTAL 4.944.944.944.944.94 3.95

GRAND TOTAL 4786.464786.464786.464786.464786.46 3632.16

SCHEDULE - HSCHEDULE - HSCHEDULE - HSCHEDULE - HSCHEDULE - HLOANS AND ADVLOANS AND ADVLOANS AND ADVLOANS AND ADVLOANS AND ADVANCESANCESANCESANCESANCESUnsecured, Considered GoodUnsecured, Considered GoodUnsecured, Considered GoodUnsecured, Considered GoodUnsecured, Considered Good(a) Advances Recoverable in Cash or 499.27499.27499.27499.27499.27 343.28

in Kind or for Value to be received(b) Advance Payment of Taxes net of provision 159.92159.92159.92159.92159.92 82.67

[Advance Tax Rs.255.71 Crore (Previous yearRs.147.17 Crore), Provision for Tax Rs.95.79 Crore(Previous year Rs.64.52 Crore)]

(c) Other Receivables 20.3020.3020.3020.3020.30 —(d) Earnest Money, Security and Other Deposits 16.6416.6416.6416.6416.64 21.67(e) FCMT difference account 2.172.172.172.172.17 19.33

TOTAL 698.30698.30698.30698.30698.30 466.95

SCHEDULE - ISCHEDULE - ISCHEDULE - ISCHEDULE - ISCHEDULE - ICURRENT LIABILITIES AND PROVISIONSCURRENT LIABILITIES AND PROVISIONSCURRENT LIABILITIES AND PROVISIONSCURRENT LIABILITIES AND PROVISIONSCURRENT LIABILITIES AND PROVISIONSCurrent LiabilitiesCurrent LiabilitiesCurrent LiabilitiesCurrent LiabilitiesCurrent Liabilities(a) Sundry Creditors 1733.041733.041733.041733.041733.04 1326.27(b) Advances from Contractees

(Interest free) 739.48739.48739.48739.48739.48 527.81Less :Related site mobilisationexpenses 88.2488.2488.2488.2488.24 148.78

651.24651.24651.24651.24651.24 379.03(c) Interest Accrued but not due on Loans 11.8111.8111.8111.8111.81 7.62(d) Investor Education & Protection

Fund shall be Credited by thefollowing amounts when due:(i) Unclaimed Dividend 0.910.910.910.910.91 0.78(ii) Unclaimed Debentures

(including interest) ————— 0.02

0.910.910.910.910.91 0.80

TOTAL 2397.002397.002397.002397.002397.00 1713.72

SCHEDULE - G (Contd.)SCHEDULE - G (Contd.)SCHEDULE - G (Contd.)SCHEDULE - G (Contd.)SCHEDULE - G (Contd.) As at31.03.2009

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

HCC 84TH ANNUAL REPORT 2009-201093

CMYK

SCHEDULE - ISCHEDULE - ISCHEDULE - ISCHEDULE - ISCHEDULE - I (Contd.) (Contd.) (Contd.) (Contd.) (Contd.) As at31.03.2009

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

Provisions:Provisions:Provisions:Provisions:Provisions:(a) Proposed Preference Dividend 0.680.680.680.680.68 3.97(b) Tax on Proposed Dividend 4.124.124.124.124.12 3.48(c) Proposed Dividend 24.2624.2624.2624.2624.26 20.50(d) Tax on Proposed Preference Dividend 0.270.270.270.270.27 1.62(e) Provision for Leave Encashment 14.3814.3814.3814.3814.38 13.18(f) Provision for Gratuity 23.4823.4823.4823.4823.48 21.08(g) Provision for Premium on

Redemption of FCCB’s 127.14127.14127.14127.14127.14 107.78

(h) Provision for sick leave 1.541.541.541.541.54 1.49

TOTAL 195.87195.87195.87195.87195.87 173.10

GRAND TOTAL 2592.872592.872592.872592.872592.87 1886.82

SCHEDULE - JSCHEDULE - JSCHEDULE - JSCHEDULE - JSCHEDULE - J PreviousYear

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreINCOME FROM OPERAINCOME FROM OPERAINCOME FROM OPERAINCOME FROM OPERAINCOME FROM OPERATIONSTIONSTIONSTIONSTIONSVVVVValue of Walue of Walue of Walue of Walue of Work Doneork Doneork Doneork Doneork Done

(i) Contract Revenue 3974.113974.113974.113974.113974.11 3555.83

Less: Finished Goods at Cost ————— 0.06

3974.113974.113974.113974.113974.11 3555.77

(ii) Service Income from Joint Ventures 1.081.081.081.081.08 4.54

TOTAL 3975.193975.193975.193975.193975.19 3560.31

SCHEDULE - KSCHEDULE - KSCHEDULE - KSCHEDULE - KSCHEDULE - KOTHER INCOMEOTHER INCOMEOTHER INCOMEOTHER INCOMEOTHER INCOME

(a) Dividend on Other Investments 0.240.240.240.240.24 0.62

(b) Miscellaneous Receipts 8.488.488.488.488.48 8.78

(c) Earlier Years Provisions No Longer Required ————— 0.18

(d) Profit on Sale of Investments (net) 6.696.696.696.696.69 1.69

(e) Exchange Loss (net) (0.67)(0.67)(0.67)(0.67)(0.67) (14.15)

TOTAL 14.7414.7414.7414.7414.74 (2.88)

SCHEDULE - LSCHEDULE - LSCHEDULE - LSCHEDULE - LSCHEDULE - LCONSTRUCTION EXPENSESCONSTRUCTION EXPENSESCONSTRUCTION EXPENSESCONSTRUCTION EXPENSESCONSTRUCTION EXPENSES

(a) Construction Material Consumed: 319.54319.54319.54319.54319.54 339.60Add: Purchases 1134.831134.831134.831134.831134.83 1308.36

1454.371454.371454.371454.371454.37 1647.96Less: Scrap and Unserviceables Sold 27.5027.5027.5027.5027.50 18.95

1426.871426.871426.871426.871426.87 1629.01Less: Stock at Close 281.23281.23281.23281.23281.23 313.13

1145.641145.641145.641145.641145.64 1315.88(b) Sub-Contract, Transportation, Hire etc. 1378.231378.231378.231378.231378.23 933.96(c) Power and Fuel 210.36210.36210.36210.36210.36 222.01(d) Repairs to Machinery 7.517.517.517.517.51 16.42(e) Other Repairs 2.022.022.022.022.02 1.53(f) Rent 14.4814.4814.4814.4814.48 12.09(g) Water Charges 14.9514.9514.9514.9514.95 8.34

TOTAL 2773.192773.192773.192773.192773.19 2510.23

SCHEDULE - MSCHEDULE - MSCHEDULE - MSCHEDULE - MSCHEDULE - MEMPLOYEES’ REMUNERAEMPLOYEES’ REMUNERAEMPLOYEES’ REMUNERAEMPLOYEES’ REMUNERAEMPLOYEES’ REMUNERATION AND BENEFITSTION AND BENEFITSTION AND BENEFITSTION AND BENEFITSTION AND BENEFITS(a) Salaries,Wages,Bonus and Gratuity 387.68387.68387.68387.68387.68 344.55(b) Contribution to Provident Fund 22.3122.3122.3122.3122.31 20.12

and Other Funds(c) Welfare Expenses 28.2528.2528.2528.2528.25 24.95

TOTAL 438.24438.24438.24438.24438.24 389.62

SCHEDULE - NSCHEDULE - NSCHEDULE - NSCHEDULE - NSCHEDULE - N PreviousYear

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

OFFICE AND SITE ESTOFFICE AND SITE ESTOFFICE AND SITE ESTOFFICE AND SITE ESTOFFICE AND SITE ESTABLISHMENT EXPENSESABLISHMENT EXPENSESABLISHMENT EXPENSESABLISHMENT EXPENSESABLISHMENT EXPENSES

(a) Stationery, Postage, Telephone & Advertisement 18.2718.2718.2718.2718.27 17.41

(b) Travelling and Conveyance 26.8026.8026.8026.8026.80 22.82

(c) Rent 1.511.511.511.511.51 2.00

(d) Rates and Taxes 4.024.024.024.024.02 1.90

(e) Insurance 5.615.615.615.615.61 5.82

(f) Professional Charges 49.4649.4649.4649.4649.46 32.02

(g) Repairs and Maintenance 14.4014.4014.4014.4014.40 10.34

(h) Directors’ Fees 0.230.230.230.230.23 0.17

(i) Auditors’ Remuneration:

(i) Audit Fees 1.051.051.051.051.05 0.83

(ii) Tax Audit Fees 0.110.110.110.110.11 0.11(iii) For Certification Work 0.400.400.400.400.40 0.29(iv) Reimbursement of Out of

Pocket Expenses 0.060.060.060.060.06 0.05(Including Service Tax)

1.621.621.621.621.62

(j) Guarantee Commission and Charges 15.5315.5315.5315.5315.53 13.04

(k) Share / Debenture Issue Expenses Written Off ————— 0.01

(l) Finance Charges 12.7012.7012.7012.7012.70 11.08

(m) Expenses Related to Prior Years ————— 0.04

(n) Loss on Sale of Assets (Net) 18.6718.6718.6718.6718.67 0.27

(o) Miscellaneous Expenses 25.3825.3825.3825.3825.38 17.24

(p) Computer Maint. & Development Expenses 5.525.525.525.525.52 5.36

(q) Bank Charges 0.090.090.090.090.09 0.23

(r) Donations 3.213.213.213.213.21 5.13

(s) Donations to Political parties (refer note IV 13) 5.005.005.005.005.00 —

(t) Provision for Doubtful Debts 0.090.090.090.090.09 —

(u) Advertisement Expenses 29.9229.9229.9229.9229.92 —

TOTAL 238.03238.03238.03238.03238.03 146.16

SCHEDULE - OSCHEDULE - OSCHEDULE - OSCHEDULE - OSCHEDULE - OINTERESTINTERESTINTERESTINTERESTINTEREST(a) On Fixed Loans 19.9219.9219.9219.9219.92 6.54

(b) On Debentures 20.4720.4720.4720.4720.47 19.79

(c) On Other Accounts 241.11241.11241.11241.11241.11 222.09

281.50281.50281.50281.50281.50 248.42

Less : Interest capitalised 0.790.790.790.790.79 1.27

280.71280.71280.71280.71280.71 247.15

Less: Interest Received

a) Fixed deposits with Banks 0.060.060.060.060.06 0.87

b) Others 4.294.294.294.294.29 9.84

TOTAL 276.36276.36276.36276.36276.36 236.44

SCHEDULE - PSCHEDULE - PSCHEDULE - PSCHEDULE - PSCHEDULE - P(a) Provision For Current Tax 69.3069.3069.3069.3069.30 34.52

(b) Provision For Deferred Tax 109.17109.17109.17109.17109.17 45.82

(c) Provision For Fringe Benefit Tax ————— 2.76

(d) MAT Credit Entitlement (56.31)(56.31)(56.31)(56.31)(56.31) (33.56)

TOTAL 122.16122.16122.16122.16122.16 49.54

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SCHEDULE- QSCHEDULE- QSCHEDULE- QSCHEDULE- QSCHEDULE- QIIIII Criteria For Preparation Of Consolidated Financial StatementsCriteria For Preparation Of Consolidated Financial StatementsCriteria For Preparation Of Consolidated Financial StatementsCriteria For Preparation Of Consolidated Financial StatementsCriteria For Preparation Of Consolidated Financial Statements

11111 Hindustan Construction Company Ltd. (HCC Ltd.) has preparedthe consolidated financial statements to provide the financialinformation of its activities along with its Subsidiaries & JointVentures as a single entity. They are collectively referred as“Group” herein.The consolidated financial statements are prepared byi) Consolidating its accounts with financial statements of its

Subsidiaries, Integrated Joint Ventures and Partnership firm.ii) Applying the equity method of accounting for its investee

companies in which it holds between 20 and 50 percentof the equity share capital.

iii) Financial statements of Integrated (i.e. Profit / Losssharing ) Joint Ventures are consolidated to the extent ofHCC and subsidiaries share in Joint Venture.

22222 Method of ConsolidationMethod of ConsolidationMethod of ConsolidationMethod of ConsolidationMethod of ConsolidationThe consolidated financial statements have been prepared bythe Company in accordance with the requirements ofAccounting Standard (AS) 21 - “Consolidated FinancialStatements” and Accounting Standard (AS) 27 - “FinancialReporting of Interest in Joint Ventures”, issued by the Instituteof Chartered Accountants of India.The year end balances and the common transactions with theSubsidiaries are eliminated in full. Whereas in case of IntegratedJoint Ventures these transactions are eliminated to the extentof HCC and its subsidiaries share in Integrated Joint Ventures.

33333 Cross HoldingCross HoldingCross HoldingCross HoldingCross HoldingInvestments held by a subsidiary viz. Western Securities Ltd.in HCC is eliminated and resultant goodwill is recognized inthe consolidated financial statements.

IIIIIIIIII Significant Accounting Policies Forming Part Of ConsolidatedSignificant Accounting Policies Forming Part Of ConsolidatedSignificant Accounting Policies Forming Part Of ConsolidatedSignificant Accounting Policies Forming Part Of ConsolidatedSignificant Accounting Policies Forming Part Of ConsolidatedAccounts As At 31st March, 2010.Accounts As At 31st March, 2010.Accounts As At 31st March, 2010.Accounts As At 31st March, 2010.Accounts As At 31st March, 2010.11111 Basis of AccountingBasis of AccountingBasis of AccountingBasis of AccountingBasis of Accounting

The Company maintains its accounts on accrual basis.Management makes estimates and technical and otherassumptions regarding the amounts of income and expenses inaccordance with Indian GAAP in the preparation of the financialstatements. Difference between the actual results and estimatesare recognised in the period in which they are determined.

22222 Fixed Assets and Intangible AssetsFixed Assets and Intangible AssetsFixed Assets and Intangible AssetsFixed Assets and Intangible AssetsFixed Assets and Intangible Assetsi) Fixed assets are stated at cost of acquisition including

attributable overheads, financial cost and interest paidon specific borrowings upto the date of acquisition/installation of the assets and improvement thereon lessaccumulated depreciation / amortisation.

ii) In respect of BOT projects, the Construction Costsincluding interest and Preliminary expenses incurredduring the period has been recognized as an intangibleasset, in accordance with Accounting Standard (AS) 26 -“Intangible Assets”.

iii) Intangible assets also comprise of trademarks, designs,licence fees , other implementation cost for software(ERP) and other application softwares acquired forin-house use.

33333 DepreciationDepreciationDepreciationDepreciationDepreciationDepreciation on fixed assets is provided:i) In respect of buildings and sheds, furniture and office

equipments on the written down value method (pro-rataon additions and deletions of the year) at rates prescribedin Schedule XIV of the Companies Act, 1956.

ii) In respect of plant & machinery, heavy vehicles, lightvehicles,helicopter, aircraft and speed boat on the straightline method at rates prescribed in schedule XIV of theCompanies Act, 1956 on a pro-rata basis.

iii) In respect of computers depreciation is provided onstraight line basis over a period of three years on prorata basis.

iv) The depreciation on assets used for construction has beentreated as period cost.

v) Software and implementation costs including users licencefees of the Enterprise Resource Planning (ERP) systemand other related application software costs are amortised

over a period of 5 years except in case of Lavasa, wherethe same is amortised over a period of 10 years.

vi) The intangible assets are amortized on a straight –linemethod over the useful life estimated in accordance withthe Concession Agreement of BOT projects.

vii) In respect of trademark and design, costs are amortizedequally over a period of ten years.

viii) User License fees for software are amortised over aperiod of five years.

44444 InvestmentsInvestmentsInvestmentsInvestmentsInvestmentsInvestments are classified as long-term and currentinvestments. Long-term investments are shown at cost orwritten down value (in case of other than temporarydiminution) and current investments are shown at cost ormarket value whichever is lower.

55555 Employee BenefitsEmployee BenefitsEmployee BenefitsEmployee BenefitsEmployee Benefitsi) Defined Contribution plan

Contribution to provident fund and superannuation fundis accounted on accrual basis.

ii) Defined Benefit planGratuity is charged to revenue on the basis of actuarialvaluation and in case of daily rated workmen on actual basiscomputed on tenure of service as at the end of the year.

iii) Other BenefitsShort term and long term compensated absenses areprovided for based on actuarial valuation. The actuarialvaluation is done as per projected unit credit method.The obligation is measured at the present value of theestimated future cash flows.The discount rates used fordetermining the present value of the obligation underdefined benefit plans, is based on market yields onGovernment Securities as at the balance sheet date,having maturity periods approximating to the terms ofthe related obligations.

66666 InventoriesInventoriesInventoriesInventoriesInventoriesi) The stock of stores, spares and embedded goods and

fuel is valued at cost (weighted average basis), or netrealisable value whichever is lower.

ii) Work-in-Progress is valued at the Contract rates and sitemobilisation expenditure of incomplete contracts is statedat cost except NJJV and KSHI JV where work in progressis determined at cost in view of policy followed by JV.

iii) Certain loose plant, tools & service equipments costingbelow Rs. 5 lacs are valued at proportionate written downvalue @ 3% p.m. over a period of 32 months.

iv) Site mobilisation expenses are presented as a deductionfrom advances from contractees to the extent funded bysuch advances

v) In case of Panchkutir Developers Ltd. (Subsidiarycompany) Land and construction /development expensesare accumulated under “Project work-in-progress” andthe same are valued at cost or net realizable value,whichever is lower.a) Cost of land purchased / acquired by the Company

includes purchase / acquisition price plus all directand indirect expenditure incurred in connection withthe purchase of land.

b) Construction / development expenditure includesall direct and indirect expenditure incurred ondevelopment of land and / or construction at site,overheads relating to site management andadministration, less incidental revenues arising fromsite operations. Indirect expenses will be allocatedto the respective items at the time of theircompletion or capitalization into fixed assets.

77777 Inventories of Land and Floor Space Index (FSI) - LavasaInventories of Land and Floor Space Index (FSI) - LavasaInventories of Land and Floor Space Index (FSI) - LavasaInventories of Land and Floor Space Index (FSI) - LavasaInventories of Land and Floor Space Index (FSI) - Lavasai) Cost of land accounted in Stock in trade is treated as (a)

Cost of FSI - 95%, (b) Land, stock-in-trade – 5%, bothbeing distinct items of inventory. Cost of Land and FSIare on a weighted average basis along with relatedpurchase / acquisition price plus all direct and indirectexpenditure incurred in connection with the purchase ofland. Land and FSI are valued at lower of Cost or Net

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Realizable Value. Land or FSI utilized for own constructionis transferred to Fixed Assets at cost.

ii) Project Work-in-Progress is valued at the contract ratesin accordance with Long-term Construction AccountingStandards.

iii) Where construction of any unit is undertaken for whichthere are no sales, such inventory is valued at lower ofcost or realizable value and is not considered under Long-term Construction for accounting purposes.

88888 Capital WCapital WCapital WCapital WCapital Work in Progressork in Progressork in Progressork in Progressork in Progress

The expenditure on construction and development of 247 Parkare accumulated under Capital work in progress. Constructionand development expenses includes cost of acquisition ofdevelopment rights, all direct and indirect expenditure incurredon development of land and / or construction includingattributable interest and financial charges, overheads relatingto site management and administration, less incidentalrevenues arising from said construction. On completion ofconstruction of building and commissioning of Plant &Machinery, such assets are capitalized leaving the incompletework as capital work in progress.

99999 Provisions, Contingent Liabilities and Contingent Assets.Provisions, Contingent Liabilities and Contingent Assets.Provisions, Contingent Liabilities and Contingent Assets.Provisions, Contingent Liabilities and Contingent Assets.Provisions, Contingent Liabilities and Contingent Assets.

Provisions involving substantial degree of estimation inmeasurement are recognised when there is a present obligationas a result of past events and it is probable that there will bean outflow of resources. Contingent liabilities are notrecognised but are disclosed in the notes. Contingent assetsare neither recognised nor disclosed in the financial statements.

1010101010 Foreign Exchange TForeign Exchange TForeign Exchange TForeign Exchange TForeign Exchange Translation of Foreign Projects andranslation of Foreign Projects andranslation of Foreign Projects andranslation of Foreign Projects andranslation of Foreign Projects andAccounting of Foreign Exchange TAccounting of Foreign Exchange TAccounting of Foreign Exchange TAccounting of Foreign Exchange TAccounting of Foreign Exchange Transactionsransactionsransactionsransactionsransactions

i) Current assets and current liabilities are translated at theexchange rate prevailing on the last day of the year.

ii) Gains or losses arising out of remittance / translations atthe year-end are credited / debited to the profit and lossaccount for the year except in cases where they relate toacquisition of Fixed assets, in which case they areadjusted to the carrying cost of such assets.

iii) Foreign exchange transactions are converted into Indianrupees at the prevailing rate on the date of thetransaction.

iv) Gains & losses in respect of foreign exchange contractsare recognised as income or expenses over the life ofthe contract.

1111111111 Financial Derivatives & Hedging transactionsFinancial Derivatives & Hedging transactionsFinancial Derivatives & Hedging transactionsFinancial Derivatives & Hedging transactionsFinancial Derivatives & Hedging transactions

Financial derivatives and hedging contracts are accounted onthe date of their settlement and realised gain / loss in respectof settled contracts is recognised in the profit & loss accountalong with the underlying transactions.

1212121212 Revenue RecognitionRevenue RecognitionRevenue RecognitionRevenue RecognitionRevenue Recognition

i) Accounting of construction contracts

The company follows percentage completion method,based on the stage of completion at the balance sheetdate, taking into account the contractual price andrevision thereto by estimating total revenue and totalcost till completion of the contract and the profit sodetermined has been accounted for proportionate to thepercentage of the actual work done.

Revenue is recognised as follows:

a. In case of item rate contracts, on the basis ofphysical measurement of work actually completed,at the balance sheet date.

b. In case of lumpsum contracts, revenue is recognisedon the completion of milestones as specified in thecontract or as identified by the Management.

Foreseeable losses are accounted for as and when theyare determined except to the extent they are expected tobe recovered through claims presented or to be presentedto the customer or in arbitration.

Claims are accounted as income in the year of receipt ofarbitration award or acceptance by client or evidence ofacceptance received.

ii) Revenue from Designing Services & Projects:Revenue from designing services & projects comprisesincome from time and fixed price contracts. Revenuefrom time contracts is recognized on man hour basis asper the terms of the contracts. Revenue from fixed pricecontracts is recognized on the completion of milestonesspecified in the contracts under percentage completionmethod. Revenue from sale of designs is accounted onthe dispatch of designs to customers.

iii) HCC Real Estate Ltd. (Subsidiary company) being adeveloper will recognize its revenue from real estate inconsonance with the principles laid down by AccountingStandard for Revenue Recognition, upon commencementof selling / leasing operations.

iv) In respect of BOT projects revenue will be recognizedfrom the point of completion of the construction period.Income from Toll Revenue is recognised on accrual basis.

v) Comprehensive Urban Development and Management -Lavasaa. Sale of Land and FSI

Revenues are recognized in the year in which theagreement to lease is executed. Income from landsales (including on a long term lease basis) isrecognized on the transfer of all significant risksand rewards of ownership to the buyers and areasonable expectation of collection of the saleconsideration from the buyers exists. .Exchange of parcels of land against other parcelsof land is not treated as sale but is adjusted in theland account.

b Project Construction WorkThe Company follows the percentage completionmethod, on the basis of physical measurement ofwork actually completed at the balance sheet date,taking into account the contractual price and revisionthereto by estimating total revenue and total costto the completion of the contract and the profit sodetermined is accounted for proportionate to thepercentage of the actual work done. Foreseeablelosses are accounted for as and when they aredetermined. Revenue from sales of constructed unitsother than under long term construction contractsare recognized on execution of transfer agreements.

c Project Management Consultancy FeesRevenue from Project Management Consultancy Feesis recognized on accrual basis, as per the Agreementsbased on the progress of Construction work.

d Sales of Constructed UnitsRevenue from sales of constructed units other thanunder long term construction contracts arerecognized on execution of transfer agreements.

e Revenue from other services are recognised whenservices are rendered.

vi) Income from lease rentalsLease rentals are accounted on accrual basis inaccordance with respective lease agreements.

1313131313 TTTTTaxationaxationaxationaxationaxationThe tax expense comprises of current tax & deferred taxcharged or credited to the profit and loss account for the year.Current tax is calculated in accordance with the tax lawsapplicable to the current financial year. The deferred tax chargeor credit is recognised using the tax rates and tax laws thathave been enacted by the balance sheet date. Where there areunabsorbed depreciation or carry forward losses, deferred taxassets are recognised only if there is virtual certainty ofrealisation of such assets. Other deferred tax assets arerecognised only to the extent there is reasonable certainty ofrealisation in future. At each balance sheet date, recognisedand unrecognised deferred tax assets are reviewed.

1414141414 Borrowing costsBorrowing costsBorrowing costsBorrowing costsBorrowing costsBorrowing costs (less any income on the temporaryinvestments of those borrowings) that are attributable to theacquisition, construction or production of a qualifying assetsare capitalised. Other borrowings costs are expensed out.

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In case of Lavasa Corporation Ltd. (Subsidiary company) theborrowing costs (less any income on the temporaryinvestments of those borrowings) that are directly attributableto qualifying assets / project work-in-progress are chargedover such qualifying assets / project work-in-progress.

1515151515 Miscellaneous ExpenditureMiscellaneous ExpenditureMiscellaneous ExpenditureMiscellaneous ExpenditureMiscellaneous Expenditure

Miscellaneous expenditure including pre-operative / preliminaryexpenses are charged off in the year they are incurred as perAccounting Standard (AS) 26 - “Intangible Assets”.

1616161616 LeasesLeasesLeasesLeasesLeases

Lease rentals in respect of assets acquired under operatinglease are charged to Profit and Loss account.

1717171717 Impairment of AssetsImpairment of AssetsImpairment of AssetsImpairment of AssetsImpairment of Assets

The Company makes an assessment of any indicator that maylead to impairment of assets on an annual basis. An asset istreated as impaired when the carrying cost of the asset exceedsits recoverable value, which is higher of net selling price andvalue in use. Any impairment loss is charged to profit andloss account in the year in which it is identified as impaired.

1818181818 Goodwill AmortisationGoodwill AmortisationGoodwill AmortisationGoodwill AmortisationGoodwill Amortisation

Goodwill arising on consolidation is tested for impairment asat the reporting date and impairment, if any, is written off.

IIIIIIIIIIIIIII Contingent LiabilitiesContingent LiabilitiesContingent LiabilitiesContingent LiabilitiesContingent Liabilities

As atAs atAs atAs atAs at As atParticularsParticularsParticularsParticularsParticulars 31.03.201031.03.201031.03.201031.03.201031.03.2010 31.03.2009

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

i) Counter Indemnities given to :

Banks, in respect of contracts

a) For works in India(Secured on all the assets) 1876.291876.291876.291876.291876.29 1902.53

b) *For works abroad (secured byECGC counter guarantees) 202.93202.93202.93202.93202.93 32.30*(Converted in rupees at therate fixed by the Bank)

ii) Foreign Currency exposure not hedged ————— 0.18

iii) Claims not acknowledged asdebts by the Company 11.0211.0211.0211.0211.02 1.90

iv) Sales Tax liability / Works ContractTax liability that may arisein respect of matters in appeal.(Net of an amount of Rs.0.53 Crore(previous year Rs.12.77 crore)recoverable from Clients as per theterms of contract) 14.2614.2614.2614.2614.26 9.05

v) Estimated amount of contractsremaining to be executed. 74.7874.7874.7874.7874.78 46.66

vi) Bills discounted with banks 165.98165.98165.98165.98165.98 241.39

vii) Corporate Guarantees:

The Group has provided an undertaking to pay in the event ofdefault on loan given by a bank to subsidiary, Joint Ventures.

I By HCC for :

a) Pune Paud Toll Road 14.3614.3614.3614.3614.36 18.48Company Limited

b) Lavasa Corporation Limited 555.44555.44555.44555.44555.44 185.43

c) HCC Real Estate Limited 423.93423.93423.93423.93423.93 410.00

d) Nirmal BOT Limited 6.186.186.186.186.18 26.78

e) Charosa Wineries Limited 22.0022.0022.0022.0022.00 17.00

II Corporate Guarantee given 1000.001000.001000.001000.001000.00 600.00by HREL for HCC

viii) A client, New Tirupur Area Development Corporation haswrongfully encashed Performance Bank Guarantee amountingto Rs. 27.40 Crore in the year 2007-08. The Company has beenlegally advised that it has a good case on merits and thereforehas invoked arbitration provisions of the contract. During theyear issues to be decided by the Arbitral Tribunal have beenframed by the Tribunal. Pending resolution of the dispute theencashed Bank Gurantee is considered as a current asset.

IVIVIVIVIV Other Notes to Accounts:Other Notes to Accounts:Other Notes to Accounts:Other Notes to Accounts:Other Notes to Accounts:

1 Notes to these Consolidated Financial Statements are intendedto serve as a means of informative disclosure and a guide tobetter understanding. Recognizing this purpose, the Companyhas disclosed only such Notes from the individual financialstatements, which fairly present the needed disclosures.

2 The Income-tax assessments of the Company have beencompleted upto the accounting year ended 31st March, 2006.Several appeals preferred by the Company are pending beforeappellate authorities. Deferred Tax liability for the period ended31st March, 2010 has been provided on the estimated taxcomputation for the year.

Major components of deferred tax assets and liabilities arisingon account of timing differences are:

2009-102009-102009-102009-102009-10 2008-09ParticularsParticularsParticularsParticularsParticulars AssetsAssetsAssetsAssetsAssets LiabilitiesLiabilitiesLiabilitiesLiabilitiesLiabilities Assets Liabilities

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore Rs. Crore

a) Depreciation 10.8410.8410.8410.8410.84 119.96119.96119.96119.96119.96 — 80.49

b) Claims/Arbitration ————— 90.5390.5390.5390.5390.53 — 79.92Awards

c) Unabsorbed 26.2726.2726.2726.2726.27 ————— — —losses

d) Others 9.819.819.819.819.81 101.64101.64101.64101.64101.64 1.61 —

e) FCCBs premium 43.1843.1843.1843.1843.18 — 36.63 —

TTTTTotalotalotalotalotal 90.1090.1090.1090.1090.10 312.13312.13312.13312.13312.13 38.24 160.41

3 Cost of Land includes:

a Rs.12.94 Crore (previous year Rs. 12.94 Crore) in respectof which sale deed is yet to be executed in the name ofcompany.

b Land amounting to Rs.0.11 Crore (previous year Rs.0.11Crore) in respect of which irrevocable Power of Attorneyis obtained in the name of company.

c Land amounting to Rs. 0.82 Crore (previous year 0.83Crore) not covered by the Master Plan in respect of whichsale deed is yet to be executed in the name of company.

4 Construction / Development expenses includes Rs.13.92 Crore(Previous year Rs. 2.39 Crore) being depreciation on the assetsused for the project.

5 Issue of Deep Discount Convertible Debentures andCompulsory Convertible Preference Shares :

i) Bank of India has subscribed Rs 150 Crore in the form ofDeep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum onsubscription amount and have maximum tenor of 5 years.The investor has an option to convert DDCD into equityshares at any time within 5 years from the closing dateat an equity valuation of Rs. 10,000 Crore or at the timeof Initial Public Offer (IPO), whichever is earlier. DDCDsare compulsorily convertible at the end of 5 years at anequity valuation of Rs. 10,000 Crore. The investor andHCC have a put / call option respectively to sell / purchasethe DDCD at the end of 39th, 48th and 60th month fromthe closing date.

ii) Allahabad Bank has subscribed Rs 50 Crore in the formof Deep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5years. The investor has an option to convert DDCDs intoequity shares at anytime within 5 years from the closingdate at an equity valuation of Rs. 10,000 Crore or at thetime of Initial Public Offer (IPO), whichever is earlier.DDCDs are compulsorily convertible at the end of 5 yearsat an equity valuation of Rs 10,000 Crore. The Investorand HCC have a put / call option respectively to sell /purchase the DDCDs at the end of 39th, 48th and 60thmonth from the closing date.

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iii) Axis Bank has subscribed Rs 225 Crore in the form ofDeep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 3.52% per annum on theface value of DDCD and have a maximum tenor of 5years. The investor has an option to convert DDCDs intoequity shares of the Company at anytime within 5 yearsat an equity valuation of Rs. 10,000 Crore from the closingdate or at the time of Initial Public Offer (IPO), whicheveris earlier. DDCDs are compulsorily convertible at the endof 5 years at an equity valuation of Rs 10,000 Crore. TheInvestor and HCC have a put / call option respectively tosell / purchase the DDCDs at the end of 36th, 48th and60th month from the closing date.

iv) Axis Bank has subscribed Rs 25 Crore in the form ofCompulsory Convertible Preference Shares (“CCPS”).

This CCPS carry a coupon of 0.001% per annum on thesubscripton amount of CCPS. The CCPS have a maximumtenor of 5 years. The Investor has an option to convertthe CCPS into equity shares of the Company at any timewithin 5 years from the Closing Date. Axis Bank and HCChave the put / call option respectively to sell / purchasethe CCPS at the end of 36th, 48th and 60th month fromthe closing date.

v) Andhra Bank has subscribed Rs 25 Crore in the form ofDeep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5years. The investor has an option to convert DDCDs intoequity shares at anytime within 5 years from the closingdate at an equity valuation of Rs. 10,000 Crore or at thetime of Initial Public Offer (IPO), whichever is earlier.DDCDs are compulsorily convertible at the end of 5 yearsat an equity valuation of Rs 10,000 Crore. The Investorand HCC have a put / call option respectively to sell /purchase the DDCDs at the end of 39th, 48th and 60thmonth from the closing date.

vi) IndusInd Bank has subscribed Rs 50 Crore in the form ofDeep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5years. The investor has an option to convert DDCDinto equity shares of the Company at anytime within 5years from the closing date at an equity valuation ofRs 10,000 Crore. The Investor and HCC have a put /call option respectively to sell / purchase the DDCD atthe end of 36th, 48th and 60th month from the closingdate.

vii) United Bank of India has subscribed Rs 50 Crore in theform of Deep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5years. The investor has an option to convert DDCDs intoequity shares at anytime within 5 years from the closingdate at an equity valuation of Rs. 10,000 Crore or at thetime of Initial Public Offer (IPO), whichever is earlier.DDCDs are compulsorily convertible at the end of 5 yearsat an equity valuation of Rs 10,000 Crore. The Investorand HCC have a put / call option respectively to sell /purchase the DDCD at the end of 39th, 48th and 60thmonth from the closing date.

viii) Allahabad Bank has subscribed Rs 50 Crore in the formof Deep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5years. The investor has an option to convert DDCDs intoequity shares at anytime within 5 years from the closingdate at an equity valuation of Rs. 10,000 Crore or at thetime of Initial Public Offer (IPO), whichever is earlier.DDCDs are compulsorily convertible at the end of 5 yearsat an equity valuation of Rs 10,000 Crore. The Investorand HCC have a put / call option respectively to sell /purchase the DDCD at the end of 39th, 48th and 60thmonth from the closing date.

ix) IndusInd Bank has subscribed Rs 50 Crore in the form ofDeep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on the facevalue of Rs 74.94 Crore of DDCD and have a maximumtenor of 5 years. The investor has an option to convertDDCD into equity shares of the Company within 5 yearsfrom the closing date i.e 9th July 2009 subject toinvestor’s stake is not less than 0.5% of Company’s equitycapital. The conversion amount is to be calculated basedon the YTM of 13% / 13.6% based on the equity valuationof Rs. 10,000 Crore. The Bank and Promoters have a put/ call option respectively to sell / purchase the DDCDs atthe end of 3rd, 4th and 5th year from the closing date.

x) ICICI Bank has subscribed Rs 250 Crore in the form ofDeep Discount Convertible Debentures (“DDCD”).

This DDCD carry a coupon of 6% per annum on thesubscription amount and have a maximum tenor of 5years. The investor has an option to convert DDCDs intoequity shares at anytime within 5 years from the closingdate at an equity valuation of Rs. 10,000 Crore or at thetime of Initial Public Offer (IPO), whichever is earlier.DDCDs are compulsorily convertible at the end of 5 yearsat an equity valuation of Rs 10,000 Crore. The Investorand HCC have a put / call option respectively to sell /purchase the DDCDs at the end of 39th, 48th and 60thmonth from the closing date.

xi) Bennett Coleman & Co. Limited (BCCL)., has invested anamount of Rs. 81.25 Crore into the Company againstissuance of one Warrant on preferential basis, giving aright to BCCL to subscribe to 0.8125 % of the fully dilutedequity share capital of the Company as on the date ofexercise of the warrant. BCCL has paid Rs 8.13 Crore being10% of the exercise amount against the allotment ofwarrant. BCCL can exercise the right of conversion at anytime during the 5 years from the date of agreement orshall exercise in whole at the end of 5th year or at thetime of IPO. In the event BCCL does not exercise its optionto acquire all the shares within 5 years the Company shallforfeit the proportionate warrant subscription price to theextent not exercised and warrant shall lapse.

6 The company issued at par 1,000 Zero Coupon ConvertibleBonds due 2011 of US$1,00,000 each and 2,69,54,200 GlobalDepository shares (GDSs) for an issue price of US $ 3.71 eachaggregating to US $ 200 million. (INR 891.60 Crore as on thedate of issue) in the year 2005-06 to finance capital expenditure,acquisitions, investment in Company’s real estate Subsidiaryand any other use as may be permitted under applicable lawor by relevant regulatory bodies from time to time . TheBondholders have an option of converting these Bonds intoshares at an initial conversion price of Rs. 248.08 per sharewith a fixed rate of conversion of Rs.44.58 = US$1 at any timeon or after 11th May 2006 up to 18th February 2011. TheBonds are also redeemable at the option of the company atleast at 130% of the early redemption amount at any time onor after 14th April, 2009 upto 18th February 2011. Unlesspreviously redeemed, converted or purchased and cancelled,the Bonds will be redeemed on 1st April 2011 at 137.7139% oftheir principal amount.

The Offering Circular provides for an adjustment to theconversion price of the FCCBs in the event the company makinga fresh issue of its equity shares for a consideration that isless than the Current Market Value of the equity shares as onthe date on which the company fixes the consideration.

Pursuant to the issuance of fresh equity shares to QIBs, thecompany has revised the conversion price of the FCCBs fromRs. 248.08 to Rs. 246.02.

Premium payable on redemption of FCCBs till 31st March 2010has been adjusted net of tax in the Securities Premium Account.

7 In the year 2005-06, pending utilization of the issue proceedsof Zero Coupon Foreign Currency Convertible Bonds (FCCB)and Global Depositary Shares (GDS) an amount of Rs. 869.54Crore had been kept in Foreign Currency Current and DepositAccounts. During the current year, out of the issue proceeds,Rs Nil (Previous year Rs. 14.42 Crore) has been utilized formeeting working capital requirements in terms of the objectsof the issue.

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8 During the year ended 31st March 2010, 34 FCCBs of the facevalue of USD 100,000 each were bought back by the companyaggregating to USD 0.34 crore.

Further, provision made for premium on redemption of FCCBsby debiting Securities Premium in the previous year has beenreversed to the extent it pertains to the FCCBs buyback.

9 The company issued 75,00,000 Warrants of Re.1/- each at apremium of Rs. 201.50 per warrant on preferential basis topromotors on 20th December, 2007. The Warrant holders wereentitled to apply for and be allotted, in one or more tranches,one equity share of Re. 1/- each of the Company per warrant,anytime after the date of allotment of Warrant but before theexpiry of 18 months from the date of allotment of suchWarrants. Upon exercise of the right to apply for Equity shares,the Warrant holders were liable to make the payment of 90%of the issue price. The Board upon receipt of the entire amountwas to allot one equity share per Warrant. However, upon notexercising the option, an amount of Rs. 15.19 Crore equivalentto 10 % of the issue price of 75,00,000 warrants received duringthe previous year has been forfeited.

10 The Company vide its Qualified Institutional PlacementDocument dated 30th June 2009 has placed 4,70,00,000 fullypaid-up Equity Shares of Re 1/- each at an issue price of Rs102.15 per Equity Share (including a premium of Rs 101.15per Equity Share), aggregating to Rs 480.11 Crore to QualifiedInstitutional Buyers. These equity shares have beensubsequently issued and alloted at its Board meeting held on4th July 2009.

11 Pune Paud Toll Road Company Ltd, a wholly owned subsidiaryhas an accumulated loss of Rs. 21.65 Crore as on 31st March2010. The toll road operated by the Company is expected togenerate manifold increase in the traffic plying on the roadduring balance part of the concessional period due to largescale hill station township development namely ‘LAVASA’taking place in the project vicinity and also the planned ringroad development extending the municipal limits of Pune citybeyond present toll plaza location.

12 a The details of Integrated Joint Ventures along with shareof interest included in consolidation is given hereunder:

Name ofName ofName ofName ofName of Name ofName ofName ofName ofName of Method ofMethod ofMethod ofMethod ofMethod of Share ofShare ofShare ofShare ofShare ofVVVVVenturesenturesenturesenturesentures the Vthe Vthe Vthe Vthe Ventures’entures’entures’entures’entures’ AccountingAccountingAccountingAccountingAccounting InterestInterestInterestInterestInterest

PartnersPartnersPartnersPartnersPartners

HCC-L&T Purulia Larsen & Toubro % 57.00%Ltd. completion

HCC-Pati Pati Sendirian, % 50.00%Berhad completion

Nathpa Jhakri Impregilio-Spa, Completed 40.00%Italy Contract

Kumagai-Skanska Skanska, kumagai, Completed 19.60%HCC-Itochu Group Itochu Contract

Alpine - Samsung Alpine Meyreder % 33.00%- HCC Bau, Samsung completion

Corporation

Alpine - HCC Alpine Meyreder % 49.00%Bau completion

Dhule Palesnar John Laing % 37.00%Tollway Limited* Investment Ltd, completion

John LaingInvestmentsMauritius (No.1)Ltd., SadbhavEngg Ltd, SadbhavInfrastructurePrj Ltd

* HCC Ltd. holds 26% and HCC Infrastructure Ltd holds11% in this Joint Venture, therefore, 37% total isconsidered for consolidation of accounts.

Each of the above Joint Ventures are incorporated inIndia. In respect of joint ventures the company alongwith other JV partners is jointly & severally responsiblefor performance of the contracts.

b List of Subsidiaries Companies included in consolidationand the Parent Company’s holding are as under:

Name of theName of theName of theName of theName of the Country ofCountry ofCountry ofCountry ofCountry of PercentagePercentagePercentagePercentagePercentage Nature ofNature ofNature ofNature ofNature ofSubsidiarySubsidiarySubsidiarySubsidiarySubsidiary IncorporationIncorporationIncorporationIncorporationIncorporation HoldingHoldingHoldingHoldingHolding RelationshipRelationshipRelationshipRelationshipRelationship

Hincon India 100% SubsidiaryTechnoconsult Ltd.

Western India 98% SubsidiarySecurities Ltd.

Pune Paud Toll India 100% SubsidiaryRoad Company Ltd.

HCC Real Estate Ltd. India 100% Subsidiary

HCC Singapore Singapore 100% SubsidiaryEnterprises Pte Ltd

HCC Mauritius Mauritius 100% SubsidiaryEnterprises Ltd

Nirmal BOT Ltd. India 100% Subsidiary

HCC Aviation Ltd India 100% Subsidiary

Badarpur Faridabad India 100% SubsidiaryTollways Ltd

Panchkutir India 100% SubsidiaryDevelopers Ltd.

HCC Infrastructure Ltd India 100% Subsidiary

Baharampore-Farakka Highways Ltd India 100% Subsidiary

Farakka-Raiganj India 100% SubsidiaryHighways Ltd

Raiganj-Dalkhola India 100% SubsidiaryHighways Ltd

HCC Construction Ltd India 100% Subsidiary

Highbar India 100% SubsidiaryTechnologies Ltd

HREL Township India 100% SubsidiaryDevelopers Ltd. of HREL

HREL (Thane) India 100% SubsidiaryReal Estate Ltd. of HREL

Maan Township India 100% SubsidiaryDevelopers Ltd. of HREL

Nashik Township India 100% SubsidiaryDevelopers Ltd. of HREL

Charosa Wineries Ltd India 100% Subsidiaryof HREL

Powai Real Estate India 100% SubsidiaryDevelopers Ltd. of HREL

HCC Realty Ltd India 100% Subsidiaryof HREL

Lavasa Corporation India 64.99% SubsidiaryLtd. of HREL

Lavasa Hotel Ltd India 100.00% Subsidiaryof Lavasa

Warasgaon Lake India 100.00% SubsidiaryView Hotels Ltd of Lavasa(Formerly LavasaStar Hotel Ltd)

Apollo Lavasa India 93.72% SubsidiaryHealth Corp Ltd of Lavasa

Ecomotel Hotel Ltd India 65.00% Subsidiaryof Lavasa

Dasve Business India 100.00% SubsidiaryHotel Ltd of Lavasa

Dasve Conventional India 100.00% SubsidiaryCenter Ltd of Lavasa

Lakeshore India 100.00% SubsidiaryWatersports Co. Ltd of Lavasa

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CMYK

Lakeview Clubs Ltd India 100.00% Subsidiaryof Lavasa

Dasve Hospitality India 100.00% SubsidiaryInstitutes Ltd of Lavasa

Dasve Retail Ltd. India 100.00% Subsidiaryof Lavasa

Spotless Laundry India 63.00% SubsidiaryServices Ltd of Lavasa

Knowledge Vista India 100.00% SubsidiaryLtd (Formerly GDXT of LavasaOxford InternationalSchool Ltd)

Lavasa Bamboocraft India 100.00% SubsidiaryLtd. of Lavasa

Full Spectrum India 100.00% SubsidiaryAdventures Ltd of Lavasa

Green Hill India 100.00% SubsidiaryResidences Limited of Lavasa

Reasonable India 100.00% SubsidiaryHousing Limited of Lavasa

My City India 81.00% SubsidiaryTechnology Limited of Lavasa

Minfur Interior India 100.00% SubsidiaryTechnologies Ltd of Lavasa

Verzon Hospitality India 100.00% SubsidiaryLtd of Lavasa

Rhapsody India 100.00% SubsidiaryHospitality Limited of Lavasa

Sirrah Palace India 100.00% SubsidiaryHotels Limited of Lavasa

Andromeda Hotels India 100.00% SubsidiaryLimited of Lavasa

Valley View India 100.00% SubsidiaryEntertainment Limited of Lavasa

Whistling Thrush India 100.00% SubsidiaryFacilities Services of LavasaLimited

Warasgaon Power India 100.00% SubsidiarySupply Limited of Lavasa

Sahyadri City India 100.00% SubsidiaryManagement of LavasaLimited

SOL Hospitality Ltd* India 64.99% Subsidiaryof Lavasa

Space Theme India 64.99% SubsidiaryPark India Ltd** of Lavasa

Warasgaon Tourism India 100.00% SubsidiaryLimited of Lavasa

* Ceased to be Subsidiary from May ‘09

** Ceased to be Subsidiary from April ‘09

c Partnership Firm included in consolidation:

Vikhroli India 100%Corporate Park

13 Donation to Political Parties

Name of the partyName of the partyName of the partyName of the partyName of the party Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore

Bharatiya Janata Party 2.00

Maharashtra State Nationalist Congress Party 1.00

All India Congress Committee 2.00

TTTTTotalotalotalotalotal 5.005.005.005.005.00

14 The Company’s proportionate share in assets, liabilities, incomeand expenses of its Joint Venture Companies included in theseconsolidated financial statements in accordance with AS 27 -“Financial Reporting of Interests in Joint Ventures” is presentedbelow:

Balance SheetBalance SheetBalance SheetBalance SheetBalance Sheet As atAs atAs atAs atAs at As at31.03.201031.03.201031.03.201031.03.201031.03.2010 31.03.2009

Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. Crore

Sources of fundsSources of fundsSources of fundsSources of fundsSources of funds

Equity Shareholders FundEquity Shareholders FundEquity Shareholders FundEquity Shareholders FundEquity Shareholders Fund

Reserves and Surplus 23.3723.3723.3723.3723.37 37.45

TTTTTotal Shareholders Fundsotal Shareholders Fundsotal Shareholders Fundsotal Shareholders Fundsotal Shareholders Funds 23.3723.3723.3723.3723.37 37.45

LoansLoansLoansLoansLoans

Secured 7.457.457.457.457.45 3.39

Unsecured 21.2621.2621.2621.2621.26 61.41

TTTTTotal Loansotal Loansotal Loansotal Loansotal Loans 28.7128.7128.7128.7128.71 64.80

Deferred TDeferred TDeferred TDeferred TDeferred Tax Liability (Net)ax Liability (Net)ax Liability (Net)ax Liability (Net)ax Liability (Net) 1.591.591.591.591.59 (0.03)

TTTTTotalotalotalotalotal 53.6753.6753.6753.6753.67 102.22

Application of FundsApplication of FundsApplication of FundsApplication of FundsApplication of Funds

Fixed AssetsFixed AssetsFixed AssetsFixed AssetsFixed Assets

Gross Block 77.0177.0177.0177.0177.01 43.78

Less: Accumulated Depreciation 5.255.255.255.255.25 2.76

Net Block - TNet Block - TNet Block - TNet Block - TNet Block - Total Fixed Assetsotal Fixed Assetsotal Fixed Assetsotal Fixed Assetsotal Fixed Assets 71.7671.7671.7671.7671.76 41.02

InvestmentsInvestmentsInvestmentsInvestmentsInvestments 3.643.643.643.643.64 —

Current Assets, Loans and AdvancesCurrent Assets, Loans and AdvancesCurrent Assets, Loans and AdvancesCurrent Assets, Loans and AdvancesCurrent Assets, Loans and Advances

AAAAA Current AssetsCurrent AssetsCurrent AssetsCurrent AssetsCurrent Assets

a. Inventories 44.4244.4244.4244.4244.42 133.10

b. Sundry Debtors 0.470.470.470.470.47 0.46

c. Cash and Bank Balances 5.355.355.355.355.35 11.94

d. Other Current Assets 0.140.140.140.140.14 0.13

BBBBB Loans and AdvancesLoans and AdvancesLoans and AdvancesLoans and AdvancesLoans and Advances 16.3716.3716.3716.3716.37 9.66

TTTTTotal Current Assets,otal Current Assets,otal Current Assets,otal Current Assets,otal Current Assets,Loans and AdvancesLoans and AdvancesLoans and AdvancesLoans and AdvancesLoans and Advances 66.7566.7566.7566.7566.75 155.29

Less: Current LiabilitiesLess: Current LiabilitiesLess: Current LiabilitiesLess: Current LiabilitiesLess: Current Liabilitiesand Provisionsand Provisionsand Provisionsand Provisionsand Provisions

a. Current Liabilities 88.4788.4788.4788.4788.47 94.08

b. Provisions 0.010.010.010.010.01 0.01

TTTTTotal Current Liabilitiesotal Current Liabilitiesotal Current Liabilitiesotal Current Liabilitiesotal Current Liabilitiesand Provisionsand Provisionsand Provisionsand Provisionsand Provisions 88.4888.4888.4888.4888.48 94.09

Net Current AssetsNet Current AssetsNet Current AssetsNet Current AssetsNet Current Assets (21.73)(21.73)(21.73)(21.73)(21.73) 61.20

TTTTTotalotalotalotalotal 53.6753.6753.6753.6753.67 102.22

Profit and Loss AccountProfit and Loss AccountProfit and Loss AccountProfit and Loss AccountProfit and Loss AccountIncomeIncomeIncomeIncomeIncome

Income from Operations 218.77218.77218.77218.77218.77 204.62

Other income 0.760.760.760.760.76 0.32

TTTTTotal Incomeotal Incomeotal Incomeotal Incomeotal Income 219.53219.53219.53219.53219.53 204.94

ExpenditureExpenditureExpenditureExpenditureExpenditure

Construction Expenses 180.86180.86180.86180.86180.86 157.22

Employees Remunerationand Benefits 19.8019.8019.8019.8019.80 16.80

Office and SiteEstablishment Expenses 11.7111.7111.7111.7111.71 18.97

Interest 4.914.914.914.914.91 4.13

Depreciation / Amortisation 3.763.763.763.763.76 2.67

TTTTTotal Expenditureotal Expenditureotal Expenditureotal Expenditureotal Expenditure 221.04221.04221.04221.04221.04 199.79

Profit / (Loss) Before TProfit / (Loss) Before TProfit / (Loss) Before TProfit / (Loss) Before TProfit / (Loss) Before Taxaxaxaxax (1.51)(1.51)(1.51)(1.51)(1.51) 5.15

Provision for Current Tax (11.18)(11.18)(11.18)(11.18)(11.18) (0.40)

Provision for Deferred Tax (1.39)(1.39)(1.39)(1.39)(1.39) —

Provision for Fringe Benefit Tax — (0.09)

Profit / (Loss) After TProfit / (Loss) After TProfit / (Loss) After TProfit / (Loss) After TProfit / (Loss) After Taxaxaxaxax (14.08)(14.08)(14.08)(14.08)(14.08) 4.66

Name of theName of theName of theName of theName of the Country ofCountry ofCountry ofCountry ofCountry of PercentagePercentagePercentagePercentagePercentage Nature ofNature ofNature ofNature ofNature ofSubsidiarySubsidiarySubsidiarySubsidiarySubsidiary IncorporationIncorporationIncorporationIncorporationIncorporation HoldingHoldingHoldingHoldingHolding RelationshipRelationshipRelationshipRelationshipRelationship

HCC 84TH ANNUAL REPORT 2009-2010100

CMYK

15 Disclosure in accordance with Accounting Standard -18 RelatedParty Transactions

AAAAA Names of Related Parties & Nature of RelationshipNames of Related Parties & Nature of RelationshipNames of Related Parties & Nature of RelationshipNames of Related Parties & Nature of RelationshipNames of Related Parties & Nature of Relationship

Nathpa Jhakri Joint Venture Integrated Joint Venture

HCC-Pati Joint Venture Integrated Joint Venture

Kumagai-Skanska-HCC- Integrated Joint VentureItochu Group

HCC-L & T Purulia Integrated Joint VentureJoint Venture

Alpine - Samsung - Integrated Joint VentureHCC Joint Venture

Alpine - HCC Joint Venture Integrated Joint Venture

Dhule Palesnar Tollway Ltd Integrated Joint Venture

Bona Sera Hotels Ltd Other Related Party

Palmetto Hospitality Ltd Other Related Party

Hincon Holdings Ltd. Other Related Party

Gulabchand Foundation Other Related Party(Formed u/s 25 of theCompanies Act, 1956)

BBBBB Key Management PersonnelKey Management PersonnelKey Management PersonnelKey Management PersonnelKey Management Personnel

Shri Ajit Gulabchand Chairman & Managing Director

Shri K.G. Tendulkar Director (Deputy ManagingDirector upto 7th November,2009)

Shri Vinayak Deshpande President & COO(EPC & Construction)

Shri Praveen Sood Group Chief Financial Officer

Shri Rajgopal Nogja President - HREL, Lavasa

Shri Arun Karambelkar Group Executive Vice President- Procurement and out sourcing

Shri V. P. Kulkarni Company Secretary

CCCCC TTTTTransactions with Related Parties:ransactions with Related Parties:ransactions with Related Parties:ransactions with Related Parties:ransactions with Related Parties:

Rs. CroreNature of TNature of TNature of TNature of TNature of Transactionsransactionsransactionsransactionsransactions Integrated JV’s Other Related

PartiesSale of ConstructionSale of ConstructionSale of ConstructionSale of ConstructionSale of Constructionmaterials and Sparesmaterials and Sparesmaterials and Sparesmaterials and Sparesmaterials and Spares

Alpine - Samsung- HCC Joint Venture 0.020.020.020.020.02 —————

(0.21) (—)Alpine - HCC Joint Venture ————— —————

(0.10) (—)

Total 0.020.020.020.020.02 —————(0.31) (—)

Purchase of ConstructionPurchase of ConstructionPurchase of ConstructionPurchase of ConstructionPurchase of Constructionmaterials and Sparesmaterials and Sparesmaterials and Sparesmaterials and Sparesmaterials and Spares

Alpine - HCC Joint Venture 0.040.040.040.040.04 —————(—) (—)

Rendering of Services /Rendering of Services /Rendering of Services /Rendering of Services /Rendering of Services /Financial IncomeFinancial IncomeFinancial IncomeFinancial IncomeFinancial Income

Alpine - Samsung- HCC Joint Venture 0.150.150.150.150.15 —————

(0.43) (—)Alpine - HCC Joint Venture 0.900.900.900.900.90 —————

(4.30) (—)Others ————— —————

(0.02) (—)

Total 1.051.051.051.051.05 —————(4.75) (—)

Receiving of ServicesReceiving of ServicesReceiving of ServicesReceiving of ServicesReceiving of Services

Hincon Holdings Ltd ————— 0.880.880.880.880.88(—) (0.17)

Total ————— 0.880.880.880.880.88(—) (0.17)

Outstanding PayablesOutstanding PayablesOutstanding PayablesOutstanding PayablesOutstanding PayablesAlpine - Samsung- HCC Joint Venture 1.171.171.171.171.17 —————

(—) (—)HCC - Pati Joint Venture 1.361.361.361.361.36 —————

(1.35) (—)Hincon Holdings Ltd ————— 12.0012.0012.0012.0012.00

(—) (—)Others 2.732.732.732.732.73 —————

(—) (—)

Total 5.255.255.255.255.25 12.0012.0012.0012.0012.00(1.35) (—)

WWWWWork Bill Receiptsork Bill Receiptsork Bill Receiptsork Bill Receiptsork Bill ReceiptsDhule Palesner Tollway Limited 39.6139.6139.6139.6139.61 —————

(—) (—)Advances Received / RecoveredAdvances Received / RecoveredAdvances Received / RecoveredAdvances Received / RecoveredAdvances Received / Recovered

Dhule Palesner Tollway Limited 23.0823.0823.0823.0823.08 —————(—) (—)

Intercorporate Deposit given /Intercorporate Deposit given /Intercorporate Deposit given /Intercorporate Deposit given /Intercorporate Deposit given /repaid during the yearrepaid during the yearrepaid during the yearrepaid during the yearrepaid during the year

Hincon Holdings Ltd ————— 0.850.850.850.850.85(—) (6.70)

Alpine-HCC Joint venture ————— —————(12.06) (—)

Total ————— 0.850.850.850.850.85(12.06) (6.70)

Intercorporate Deposit received /Intercorporate Deposit received /Intercorporate Deposit received /Intercorporate Deposit received /Intercorporate Deposit received /recovered during the yearrecovered during the yearrecovered during the yearrecovered during the yearrecovered during the year

Hincon Holdings Ltd ————— 12.7512.7512.7512.7512.75(—) (5.55)

Alpine-HCC Joint venture ————— —————(18.76) (—)

Total ————— 12.7512.7512.7512.7512.75(18.76) (5.55)

Outstanding ReceivablesOutstanding ReceivablesOutstanding ReceivablesOutstanding ReceivablesOutstanding ReceivablesNathpa Jhakri Joint Venture 4.834.834.834.834.83 —————

(17.53) (—)Alpine-HCC Joint venture 4.274.274.274.274.27 —————

(3.71) (—)Kumagai-Skanska-HCC-Itochu Group 0.430.430.430.430.43 —————

(4.81) (—)HCC- L&T Purulia JV 0.810.810.810.810.81 —————

(—) (—)

Total 10.3410.3410.3410.3410.34 —————(26.05) (—)

DonationsDonationsDonationsDonationsDonationsGulabchand Foundations ————— 3.003.003.003.003.00

(—) (5.00)Share WShare WShare WShare WShare Warrants Forfeited during the yeararrants Forfeited during the yeararrants Forfeited during the yeararrants Forfeited during the yeararrants Forfeited during the year

Hincon Holdings Ltd. ————— 12.5612.5612.5612.5612.56(—) (—)

Bank Guarantees given outstandingBank Guarantees given outstandingBank Guarantees given outstandingBank Guarantees given outstandingBank Guarantees given outstandingas at the end of the yearas at the end of the yearas at the end of the yearas at the end of the yearas at the end of the year

Alpine-Samsung-HCC Joint venture 52.5652.5652.5652.5652.56 —————

(88.24) (—)Alpine-HCC Joint venture 12.4312.4312.4312.4312.43 —————

(25.81) (—)HCC- L&T Purulia JV 9.519.519.519.519.51 —————

(—) (—)Others ————— —————

(16.22) (—)

Total 74.5174.5174.5174.5174.51 —————(130.27) (—)

Note: Figures in brackets pertain to previous yearNote: Figures in brackets pertain to previous yearNote: Figures in brackets pertain to previous yearNote: Figures in brackets pertain to previous yearNote: Figures in brackets pertain to previous year.....

Rs. CroreNature of TNature of TNature of TNature of TNature of Transactionsransactionsransactionsransactionsransactions Integrated JV’s Other Related

Parties

HCC 84TH ANNUAL REPORT 2009-2010101

CMYK

DDDDD aaaaa Details of Transactions relating to persons referredto in item (B) above

Nature of TNature of TNature of TNature of TNature of Transactionsransactionsransactionsransactionsransactions 2009-102009-102009-102009-102009-10 2008-092008-092008-092008-092008-09Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore

Remuneration 19.7319.7319.7319.7319.73 14.71

Salary of Ms. ShalakaGulabchand Dhawan(Daughter ofShri Ajit Gulabchand) 0.650.650.650.650.65 0.55Security Depositreceived fromMr. Praveen Sood ————— 0.10Rent received fromMr. Praveen Sood 0.020.020.020.020.02 0.05

b (1)b (1)b (1)b (1)b (1) Options granted to Key Management Personnelunder Employees’ Stock Option Scheme of HCC Ltd.

Number of Options GrantedNumber of Options GrantedNumber of Options GrantedNumber of Options GrantedNumber of Options GrantedAs atAs atAs atAs atAs at As at

31.03.201031.03.201031.03.201031.03.201031.03.2010 31.03.2009

i) Shri K.G. Tendulkar 617,600617,600617,600617,600617,600 617,600ii) Shri Vinayak Deshpande 193,750193,750193,750193,750193,750 193,750iii) Shri Praveen Sood 274,500274,500274,500274,500274,500 274,500iv) Shri Rajgopal Nogja 171,600171,600171,600171,600171,600 171,600v) Shri V. P. Kulkarni 137,200137,200137,200137,200137,200 137,200vi) Shri Arun Karambelkar 274,500274,500274,500274,500274,500 274,500

b (2)b (2)b (2)b (2)b (2) Options granted to Key Management Personnelunder Employees’ Stock Option Scheme of LavasaCorporation Ltd.

Number of Options GrantedNumber of Options GrantedNumber of Options GrantedNumber of Options GrantedNumber of Options Granted

As atAs atAs atAs atAs at As at31.03.201031.03.201031.03.201031.03.201031.03.2010 31.03.2009

i) Shri K.G. Tendulkar 9,8009,8009,8009,8009,800 7,420ii) Shri Praveen Sood 4,3604,3604,3604,3604,360 3,300iii) Shri Rajgopal Nogja 39,21039,21039,21039,21039,210 29,690iv) Shri V. P. Kulkarni 2,1802,1802,1802,1802,180 1,650v) Shri Arun Karambelkar 4,3604,3604,3604,3604,360 3,300

1616161616 Employees Stock Option Scheme:Employees Stock Option Scheme:Employees Stock Option Scheme:Employees Stock Option Scheme:Employees Stock Option Scheme:AAAAA Scheme of HCCScheme of HCCScheme of HCCScheme of HCCScheme of HCC

a Options granted i) The Company offered44,58,800 Stock Options onApril 25, 2008 (each optioncarrying entitlement for oneequity share of the face valueof Re.1/- each) at a price ofRs.132.50 per equity share.Out of the total Stock optionsoffered, 3,27,200 have beenlapsed on account ofresignation by employees.

ii) In accordance with theapproval of the Board ofDirectors and theShareholders of the Company,the ESOP CompensationCommittee at its meeting heldon July 20, 2009 has repriced41,31,600 options at Rs.104.05per equity share.

iii) The ESOP Compensationcommittee at its meeting heldon 23rd October 2008 granted1,93,750 options at an exerciseprice of Rs. 43.40 per Equityshare.

b Settlement Through Equity Shares.

c Options vested 7,70,880. Options shall not bevested before the expiry of 1 yearand not after 4 years from the dateof grant of Options.

d Outstanding at the beginningof the year 4,325,350

e Granted during the year NILf Forfeited during the year NILg Exercised during the year NILh Expired / cancelled during the year NILi Outstanding at the end of the year 4,325,350j Exercisable at the end of the year NIL

BBBBB Scheme of LavasaScheme of LavasaScheme of LavasaScheme of LavasaScheme of Lavasa

a Options granted i) The Company granted 154,200stock options on April 21, 2008(each option carryingentitlement for 1 equity shareof the face value of Rs. 10/-each) at an exercise price ofRs. 534.52 per equity share.

ii) The ESOP compensationcommittee at its meeting heldon October 20, 2009 granted49,000 additional options toexisting option holders at anexercise price of Rs. 534.52 perequity share for making anadjustment to the number ofoptions on account of theincrease in the equity sharecapital of the Company, postgrant of the initial options.

b Settlement Through Equity Shares.

c Options vested Not applicable since the optionsshall not be vested before theexpiry of 3 to 5 years from thedate of the grant of options, thatis, April 21, 2008.

d Outstanding at the beginningof the year 152,550

e Granted during the year 49,000f Forfeited during the year NILg Exercised during the year NILh Expired / cancelled during the year NILi Outstanding at the end of the year 203,200j Exercisable at the end of the year NIL

1717171717 Employees Stock Option PlanEmployees Stock Option PlanEmployees Stock Option PlanEmployees Stock Option PlanEmployees Stock Option Plan

In respect of the stock options granted pursuant to theCompany’s Stock Option Scheme, market value of theCompany’s shares as on the grant date was equal to the parvalue of the options granted, hence no accounting entries asper ESOP Guidelines are required to be made.

1818181818 Due to Inter Company Sales during the year, sales and profitbefore tax are eliminated in the Consolidated Financialstatements. However the tax provision is the sum total of taxprovision of Holding Company, Subsidiaries and IntegratedJoint Ventures.

1919191919 Segment Reporting:Segment Reporting:Segment Reporting:Segment Reporting:Segment Reporting:

The Group has disclosed Business Segment as the primarysegment. Segments have been identified taking into accountthe nature of activities of the parent company, its subsidiariesand joint ventures, the differing risks and returns, theorganization structure and internal reporting system. Thereare no reportable geographical segments.

The Group’s operations predominantly relate to “Engineering& Construction”, “Real Estate” and “Comprehensive UrbanDevelopment and Management”. Other business segmentscontribute less than 10 % of the total revenue and have beengrouped as “Others”.

The Segment Revenue, Segment Results, Segment Assets andSegment Liabilities include respective amounts identifiable toeach of the segments and also amounts allocated on areasonable basis.

HCC 84TH ANNUAL REPORT 2009-2010102

CMYK

1919191919 Segment Reporting: (Contd.)Segment Reporting: (Contd.)Segment Reporting: (Contd.)Segment Reporting: (Contd.)Segment Reporting: (Contd.)

Segment Information For The YSegment Information For The YSegment Information For The YSegment Information For The YSegment Information For The Year Ended March 31, 2010ear Ended March 31, 2010ear Ended March 31, 2010ear Ended March 31, 2010ear Ended March 31, 2010

Information About Primary Business SegmentsInformation About Primary Business SegmentsInformation About Primary Business SegmentsInformation About Primary Business SegmentsInformation About Primary Business Segments

Rs CroreRs CroreRs CroreRs CroreRs Crore

ParticularsParticularsParticularsParticularsParticulars Engineering &Engineering &Engineering &Engineering &Engineering & Real EstateReal EstateReal EstateReal EstateReal Estate ComprehensiveComprehensiveComprehensiveComprehensiveComprehensive OthersOthersOthersOthersOthers TTTTTotalotalotalotalotalConstructionConstructionConstructionConstructionConstruction Urban DevelopmentUrban DevelopmentUrban DevelopmentUrban DevelopmentUrban Development

& Management& Management& Management& Management& Management

Revenue:Revenue:Revenue:Revenue:Revenue:

External Sales 3655.343655.343655.343655.343655.34 13.4813.4813.4813.4813.48 306.37306.37306.37306.37306.37 ————— 3975.193975.193975.193975.193975.19(3353.21) — (207.10) — (3560.31)

Add: Inter Segment Sales ————— ————— ————— ————— —————(—) (—) (—) (0.05) (0.05)

Total Segment Revenue 3655.343655.343655.343655.343655.34 13.4813.4813.4813.4813.48 306.37306.37306.37306.37306.37 ————— 3975.193975.193975.193975.193975.19(3353.21) (—) (207.10) (0.05) (3560.36)

Less: Eliminations —————(0.05)

Total 3975.193975.193975.193975.193975.19(3560.31)

Result (profit before Interest) 296.51296.51296.51296.51296.51 1.461.461.461.461.46 99.1899.1899.1899.1899.18 (4.07)(4.07)(4.07)(4.07)(4.07) 393.08393.08393.08393.08393.08(245.31) (-4.42) (145.23) (-2.92) (383.20)

Less: Eliminations ——————

Result (profit before interest) 393.08393.08393.08393.08393.08(383.20)

Less: Interest Expenses 276.36276.36276.36276.36276.36(236.45)

Add: Dividend on other Investments 0.240.240.240.240.24(0.62)

Add: Profit on Sale of Investments 6.696.696.696.696.69(1.69)

Current Tax 69.3069.3069.3069.3069.30(34.52)

Deferred Tax 109.17109.17109.17109.17109.17(45.82)

Fringe Benefit Tax —————(2.76)

MAT credit entitlement (56.31)(56.31)(56.31)(56.31)(56.31)(-33.56)

Net ProfitNet ProfitNet ProfitNet ProfitNet Profit 1.481.481.481.481.48(99.53)

Other InformationOther InformationOther InformationOther InformationOther Information

Segment Assets 5920.295920.295920.295920.295920.29 803.62803.62803.62803.62803.62 2451.822451.822451.822451.822451.82 4.074.074.074.074.07 9179.809179.809179.809179.809179.80(4757.89) (557.86) (1550.20) (21.82) (6887.77)

Segment liabilities 2064.892064.892064.892064.892064.89 51.7851.7851.7851.7851.78 434.96434.96434.96434.96434.96 0.100.100.100.100.10 2551.732551.732551.732551.732551.73(1625.65) (5.03) (221.57) (2.97) (1855.22)

Capital expenditure 642.16642.16642.16642.16642.16 602.96602.96602.96602.96602.96 138.84138.84138.84138.84138.84 ————— 1383.961383.961383.961383.961383.96(529.55) (66.13) (200.40) (—) (796.08)

Depreciation 131.23131.23131.23131.23131.23 2.332.332.332.332.33 6.856.856.856.856.85 0.060.060.060.060.06 140.47140.47140.47140.47140.47(125.71) (0.15) (—) (0.05) (125.91)

Non-Cash Expenses otherthan depreciation ————— ————— ————— ————— —————

(—) (1.76) (—) (—) (1.76)

HCC 84TH ANNUAL REPORT 2009-2010103

CMYK

TTTTTotal Assets Exclude:otal Assets Exclude:otal Assets Exclude:otal Assets Exclude:otal Assets Exclude:

Investments 26.4226.4226.4226.4226.42 ————— 279.15279.15279.15279.15279.15 ————— 305.57305.57305.57305.57305.57(14.36) (—) (80.93) (—) (95.29)

Advance Tax (Net) 107.78107.78107.78107.78107.78 0.600.600.600.600.60 51.4451.4451.4451.4451.44 0.100.100.100.100.10 159.92159.92159.92159.92159.92(73.06) (0.15) (9.40) (0.05) (82.66)

Other Current Assets 4.944.944.944.944.94 ————— ————— ————— 4.944.944.944.944.94(3.95) (—) (—) (—) (3.95)

Miscellaneous Expenditure(to the extent not written off) ————— ————— ————— ————— —————

(—) (—) (—) (0.10) (0.10)

TTTTTotal Liabilities Exclude:otal Liabilities Exclude:otal Liabilities Exclude:otal Liabilities Exclude:otal Liabilities Exclude:

Secured Loans 1468.301468.301468.301468.301468.30 356.18356.18356.18356.18356.18 1623.601623.601623.601623.601623.60 ————— 3448.083448.083448.083448.083448.08(1118.45) (348.00) (978.78) (0.92) (2446.15)

Unsecured Loans 1572.921572.921572.921572.921572.92 180.73180.73180.73180.73180.73 176.64176.64176.64176.64176.64 0.010.010.010.010.01 1930.301930.301930.301930.301930.30(1479.11) (128.37) (—) (—) (1607.48)

Proposed Dividend(including taxes thereon) 28.3828.3828.3828.3828.38 0.950.950.950.950.95 ————— ————— 29.3329.3329.3329.3329.33

(23.98) (—) (—) (—) (23.98)

Accrued interest 11.8111.8111.8111.8111.81 ————— ————— ————— 11.8111.8111.8111.8111.81(7.62) (—) (—) (—) (7.62)

2020202020 Earnings per share:Earnings per share:Earnings per share:Earnings per share:Earnings per share: As atAs atAs atAs atAs at As at

Basic EPSBasic EPSBasic EPSBasic EPSBasic EPS 31.03.201031.03.201031.03.201031.03.201031.03.2010 31.03.2009

A Profit computation for basic earnings per share of Re.1/- each

Net Profit as per profit & loss account available forEquity Share holders (Rs. Crore) (a) 5.805.805.805.805.80 59.24

Less : 6% Preference Dividend (net) (b) (0.68)(0.68)(0.68)(0.68)(0.68) (3.75)

Adjusted Net Profit as per profit & loss accountavailable to equity share holders (Rs. Crore) (a-b) 6.486.486.486.486.48 62.99

B Weighted average number of Equity shares for EPS computation (Nos.) 291,119,490291,119,490291,119,490291,119,490291,119,490 256,249,600

C EPS (weighted average)

Basic EPS (before and after Extra ordinary items) (Rs.) 0.220.220.220.220.22 2.46

Diluted EPSDiluted EPSDiluted EPSDiluted EPSDiluted EPS

A Profit computation for diluted earnings per share of Re.1/-each

Net Profit as per Profit & Loss Account available forEquity shareholders (Rs. Crore) (a) 5.805.805.805.805.80 59.24

Less : 6% Preference Dividend (net) (b) (0.68)(0.68)(0.68)(0.68)(0.68) (3.75)

Adjusted Net Profit as per profit & loss accountavailable to equity share holders (Rs. Crore) (a-b) 6.486.486.486.486.48 62.99

B Weighted average number of Equity shares for EPS computation (Nos.) 312,949,222312,949,222312,949,222312,949,222312,949,222 279,294,402

Diluted EPS ( before and after Extraordinary Items)Diluted EPS ( before and after Extraordinary Items)Diluted EPS ( before and after Extraordinary Items)Diluted EPS ( before and after Extraordinary Items)Diluted EPS ( before and after Extraordinary Items) (Rs.) 0.210.210.210.210.21 2.26

2121212121 Figures for the previous year have been regrouped / recast, wherever necessary.

2222222222 ‘ * ‘ represents amount less than Rs. 100000.

Rs CroreRs CroreRs CroreRs CroreRs Crore

ParticularsParticularsParticularsParticularsParticulars Engineering &Engineering &Engineering &Engineering &Engineering & Real EstateReal EstateReal EstateReal EstateReal Estate ComprehensiveComprehensiveComprehensiveComprehensiveComprehensive OthersOthersOthersOthersOthers TTTTTotalotalotalotalotalConstructionConstructionConstructionConstructionConstruction Urban DevelopmentUrban DevelopmentUrban DevelopmentUrban DevelopmentUrban Development

& Management& Management& Management& Management& Management

As per our report attached AJIT GULABCHAND Chairman & Managing DirectorFor K.S. AIYAR & CO.Chartered AccountantsRegn. No. 100186W Y.H. MALEGAM

K.G. TENDULKARRAGHUVIR M. AIYAR PRAVEEN SOOD RAJAS R. DOSHIPartner Group Chief Financial Officer D.M. POPATMembership No. 38128 RAM P. GANDHI Directors

PROF. FRED MOAVENZADEHSHARAD M. KULKARNI

VITHAL P.KULKARNI NIRMAL P. BHOGILALCompany Secretary ANIL SINGHVI

Mumbai, Dated: 30th April, 2010 Mumbai, Dated: 30th April, 2010

}

HCC 84TH ANNUAL REPORT 2009-2010104

CMYK

2009-102009-102009-102009-102009-10 2008-09Rs. CroreRs. CroreRs. CroreRs. CroreRs. Crore Rs.Crore

A.A.A.A.A. CASH FLOW FROM OPERACASH FLOW FROM OPERACASH FLOW FROM OPERACASH FLOW FROM OPERACASH FLOW FROM OPERATING ACTIVITIESTING ACTIVITIESTING ACTIVITIESTING ACTIVITIESTING ACTIVITIESNet Profit before tax and Exceptional items 123.64123.64123.64123.64123.64 149.07Adjustments for :Depreciation 140.47140.47140.47140.47140.47 125.91Interest expense 280.71280.71280.71280.71280.71 247.15Interest / Dividend received (0.30)(0.30)(0.30)(0.30)(0.30) (11.33)Lease Rentals 7.027.027.027.027.02 6.83Foreign Exchange (Gain) / Loss (0.67)(0.67)(0.67)(0.67)(0.67) 14.15Share Issue exp. written off ————— 0.01(Profit) / Loss on sale of Assets 18.6718.6718.6718.6718.67 0.27(Profit) / Loss on sale of investment (6.69)(6.69)(6.69)(6.69)(6.69) (1.69)Provision for Doubtful debts 0.090.090.090.090.09 —Preliminary Exps ————— (0.10)

439.30439.30439.30439.30439.30 381.19

Operating profit before working capital changes 562.94562.94562.94562.94562.94 530.26Adjustments for :Trade & Other receivable (299.22)(299.22)(299.22)(299.22)(299.22) (159.26)Inventories (916.98)(916.98)(916.98)(916.98)(916.98) (423.83)Trade payables 400.81400.81400.81400.81400.81 565.87Client Advances (Interest Free) 272.22272.22272.22272.22272.22 100.33

(543.17)(543.17)(543.17)(543.17)(543.17) 83.11Cash Generated from operations 19.7719.7719.7719.7719.77 613.38Direct Taxes paid (95.10)(95.10)(95.10)(95.10)(95.10) (43.56)

NET CASH FLOW FROM OPERANET CASH FLOW FROM OPERANET CASH FLOW FROM OPERANET CASH FLOW FROM OPERANET CASH FLOW FROM OPERATING ACTIVITIESTING ACTIVITIESTING ACTIVITIESTING ACTIVITIESTING ACTIVITIES (75.33)(75.33)(75.33)(75.33)(75.33) 569.82B.B.B.B.B. CASH FLOW FROM INVESTING ACTIVITIESCASH FLOW FROM INVESTING ACTIVITIESCASH FLOW FROM INVESTING ACTIVITIESCASH FLOW FROM INVESTING ACTIVITIESCASH FLOW FROM INVESTING ACTIVITIES

Purchase of fixed assets (1309.72)(1309.72)(1309.72)(1309.72)(1309.72) (1566.96)Sale of Fixed Assets 57.4957.4957.4957.4957.49 29.07Minority Interest 18.6418.6418.6418.6418.64 19.36Purchase of Investments (226.72)(226.72)(226.72)(226.72)(226.72) (81.72)Sale of Investments 23.1423.1423.1423.1423.14 32.56Decapitalisation of Assets adjustment 108.48108.48108.48108.48108.48 (98.36)Inter Corporate Deposits ————— 4.93Interest received (0.93)(0.93)(0.93)(0.93)(0.93) 8.90Dividend received 0.240.240.240.240.24 0.62

NET CASH USED IN INVESTING ACTIVITIESNET CASH USED IN INVESTING ACTIVITIESNET CASH USED IN INVESTING ACTIVITIESNET CASH USED IN INVESTING ACTIVITIESNET CASH USED IN INVESTING ACTIVITIES (1329.38)(1329.38)(1329.38)(1329.38)(1329.38) (1651.60)C.C.C.C.C. CASH FLOW FROM FINANCING ACTIVITIESCASH FLOW FROM FINANCING ACTIVITIESCASH FLOW FROM FINANCING ACTIVITIESCASH FLOW FROM FINANCING ACTIVITIESCASH FLOW FROM FINANCING ACTIVITIES

Interest paid (276.71)(276.71)(276.71)(276.71)(276.71) (243.19)Repayment of lease finance liabilities (7.02)(7.02)(7.02)(7.02)(7.02) (6.83)Proceeds from long term and other borrowings 1324.931324.931324.931324.931324.93 1351.90Debenture Issue Expenses — (0.10)FCCB premium Provision 19.3619.3619.3619.3619.36 (107.78)Equity Share Forfeiture Account 15.1915.1915.1915.1915.19 9.81Adjustment of Exchange Gain difference ————— (29.43)Share Warrants (15.19)(15.19)(15.19)(15.19)(15.19) 8.12Increase in Share Capital / Share premium 459.26459.26459.26459.26459.26 —Dividend paid (23.66)(23.66)(23.66)(23.66)(23.66) (20.60)

NET CASH USED IN FINANCING ACTIVITIESNET CASH USED IN FINANCING ACTIVITIESNET CASH USED IN FINANCING ACTIVITIESNET CASH USED IN FINANCING ACTIVITIESNET CASH USED IN FINANCING ACTIVITIES 1496.161496.161496.161496.161496.16 961.90NET INCREASE IN CASH AND CASH EQUIVNET INCREASE IN CASH AND CASH EQUIVNET INCREASE IN CASH AND CASH EQUIVNET INCREASE IN CASH AND CASH EQUIVNET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C)ALENTS (A+B+C)ALENTS (A+B+C)ALENTS (A+B+C)ALENTS (A+B+C) 91.4591.4591.4591.4591.45 (119.88)CASH AND CASH EQUIVALENTS AS AT 01/04/2009 (OPENING BAL.) 219.12219.12219.12219.12219.12 339.00UNREALISED FOREIGN EXCHANGE GAIN / (LOSS) (0.17)(0.17)(0.17)(0.17)(0.17) 0.20CASH AND CASH EQUIVALENTS 310.74310.74310.74310.74310.74 218.92

CASH AND CASH EQUIVALENTS AS AT 31/03/2010 (CLOSING BAL.) 310.57310.57310.57310.57310.57 219.12

91.4591.4591.4591.4591.45 (119.88)NOTES : 1. Proceeds from Long Term and Other Borrowings are shown net of repayments.

2. Previous years figures have been regrouped wherever necessary.

Consolidated Cash Flow Statement for the year ended 31st March, 2010

As per our report attached AJIT GULABCHAND Chairman & Managing DirectorFor K.S. AIYAR & CO.Chartered AccountantsRegn. No. 100186W Y.H. MALEGAM

K.G. TENDULKARRAGHUVIR M. AIYAR PRAVEEN SOOD RAJAS R. DOSHIPartner Group Chief Financial Officer D.M. POPATMembership No. 38128 RAM P. GANDHI Directors

PROF. FRED MOAVENZADEHSHARAD M. KULKARNI

VITHAL P.KULKARNI NIRMAL P. BHOGILALCompany Secretary ANIL SINGHVI

Mumbai, Dated: 30th April, 2010 Mumbai, Dated: 30th April, 2010

}